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Q3 2009 Earning Report of Sensient Technologies

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  • 1. FORM 8-K SENSIENT TECHNOLOGIES CORP - SXT Filed: October 16, 2009 (period: October 16, 2009) Report of unscheduled material events or corporate changes.
  • 2. Table of Contents 8-K - FORM 8-K ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS. SIGNATURES EXHIBIT INDEX EX-99.1 (EX-99.1)
  • 3. UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 October 16, 2009 (Date of Report/Date of earliest event reported) SENSIENT TECHNOLOGIES CORPORATION (Exact name of registrant as specified in its charter) WISCONSIN 1-7626 39-0561070 (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) 777 East Wisconsin Avenue Milwaukee, Wisconsin 53202-5304 (Address and zip code of principal executive offices) (414) 271-6755 (Registrant’s telephone number, including area code) N/A (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: � Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) � Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) � Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) � Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Source: SENSIENT TECHNOLOGIES CORP, 8-K, October 16, 2009
  • 4. ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On October 16, 2009, Sensient Technologies Corporation issued a press release disclosing its results of operations for its quarter and nine months ended September 30, 2009 and its financial condition at that date. The press release is furnished as Exhibit 99.1 to this Report on Form 8-K. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS. Exhibit 99.1: The following exhibit is furnished with this Report on Form 8-K: Sensient Technologies Corporation Earnings Press Release for the Quarter and Nine Months Ended September 30, 2009. 2 Source: SENSIENT TECHNOLOGIES CORP, 8-K, October 16, 2009
  • 5. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. SENSIENT TECHNOLOGIES CORPORATION (Registrant) By: /s/ John L. Hammond Name: John L. Hammond Title: Senior Vice President, General Counsel and Secretary Date: October 16, 2009 3 Source: SENSIENT TECHNOLOGIES CORP, 8-K, October 16, 2009
  • 6. EXHIBIT INDEX Exhibit 99.1: The following exhibit is furnished with this Report on Form 8-K: Sensient Technologies Corporation Earnings Press Release for the Quarter and Nine Months Ended September 30, 2009. Source: SENSIENT TECHNOLOGIES CORP, 8-K, October 16, 2009
  • 7. Exhibit 99.1 FOR IMMEDIATE RELEASE Contact: Dick Hobbs (414) 347-3836 Sensient Technologies Corporation Reports Earnings for the Quarter Ended September 30, 2009 Quarterly Cash Flow Up 55% EPS Even With Prior Year on Local Currency Basis MILWAUKEE—October 16, 2009—Sensient Technologies Corporation (NYSE: SXT) reported that diluted earnings per share for the three months ended September 30, 2009, equaled 47 cents. Diluted earnings per share for the prior year’s comparable period were 50 cents. Third quarter earnings, as stated in local currency, would be approximately 3 cents per share higher than reported earnings and even with the prior year. Consolidated revenue for the third quarter of 2009 was $303.2 million compared to $318.6 million in the third quarter of 2008. Foreign currency translation reduced third quarter revenues by 4.2%. On a local currency basis, consolidated quarterly revenue was lower by approximately 1% in comparison to the prior year. Diluted earnings per share for the nine months ended September 30, 2009, were $1.45 compared to $1.46 cents in last year’s comparable period. As stated in local currency, earnings per share for the 2009 year-to-date period would be approximately 14 cents higher than reported earnings. Revenue for the first nine months of this year was $890.0 million, compared to $958.8 million in the prior year’s first nine months. Foreign currency translation decreased revenues in the year-to-date period by 7.3%. As reported in local currency, revenue for the first nine months of the year was in line with the prior year. Cash provided by operating activities in the third quarter rose sharply to $43.1 million, compared to $27.8 million in the prior year’s comparable period. For the nine months ended - MORE - Source: SENSIENT TECHNOLOGIES CORP, 8-K, October 16, 2009
  • 8. Sensient Technologies Corporation Page 2 Earnings Release – Third Quarter Ended September 30, 2009 October 16, 2008 September 30, 2009, cash provided by operating activities was $98.6 million, an increase of 48.7% compared to the prior year. Total debt at September 30, 2009, was $444.5 million, a reduction of $35.4 million since the beginning of the year and $39.4 million in the last twelve months. “We saw strength this quarter in a number of markets, but overall results continue to be impacted by soft economic conditions,” said Kenneth P. Manning, Chairman and CEO of Sensient Technologies Corporation. “Our strategy of reducing debt and investing in our business has allowed the Company to deliver stable results during this challenging period. I remain optimistic about Sensient’s prospects in the future.” BUSINESS REVIEW The Flavors & Fragrances Group reported revenue for the third quarter of 2009 of $194.8 million compared to third quarter 2008 revenue of $204.6 million. Group operating profit of $30.7 million was down 3.4% in comparison to the prior year’s operating income of $31.8 million. Revenue for the first nine months of 2009 was $576.9 million and operating income was $94.9 million. In the third quarter, unfavorable foreign currency comparisons reduced Flavors & Fragrances Group revenue and operating income by approximately 4%. On a local currency basis, quarterly revenue for the Group was down 1% and local currency operating income was in line with the prior year’s level. Sales of flavors in the quarter were impacted by soft consumer demand and delayed new product introductions on the part of customers. Group operating margins in the quarter improved 20 basis points in comparison to the prior year partly as a result of price increases that were implemented in prior quarters. The Color Group reported third quarter revenue of $94.2 million in comparison to $102.7 million in last year’s third quarter. Operating income for the quarter was $14.6 million compared to prior year operating income of $17.7 million. Revenue for the first nine months of 2009 was $275.0 million and operating income was $43.3 million. Unfavorable - MORE - Source: SENSIENT TECHNOLOGIES CORP, 8-K, October 16, 2009
  • 9. Sensient Technologies Corporation Page 3 Earnings Release – Third Quarter Ended September 30, 2009 October 16, 2008 foreign currency comparisons reduced third quarter Color Group revenue and operating income by approximately 6% and 5%, respectively. As stated in local currency, the Color Group’s third quarter revenue and operating income were down 2.7% and 12.6%, respectively. Soft consumer demand and continued inventory de-stocking resulted in lower sales of the Group’s non-food colors in the quarter. Sales of food and beverage colors, as stated in local currency, were up in selected markets, including Latin America and Europe, but were offset by lower sales in the U.S. market. 2009 OUTLOOK Sensient now expects 2009 diluted earnings per share to be within a range of $1.85 and $1.90. CONFERENCE CALL The company will host a conference call to discuss its 2009 third quarter financial results at 10:00 a.m. CDT on Friday, October 16, 2009. To make a reservation for the conference call, please contact InterCall Teleconferencing at (706) 645-6973 and refer to the Sensient Technologies Corporation conference call. A replay will be available beginning at 1:00 p.m. CDT on October 16, 2009, through midnight on October 23, 2009, by calling (706) 645-9291 and referring to conference identification number 34671430. A transcript of the call will also be posted on the company’s web site at www.sensient-tech.com after the call concludes. This release contains forward-looking statements (as that term is defined in the Private Securities Litigation Reform Act of 1995) that reflect management’s current assumptions and estimates of future economic circumstances, industry conditions, company performance and financial results. A variety of factors could cause the company’s actual results and experience to differ materially from the anticipated results, including, but not limited to the factors noted in this press release and in the Management’s Discussion and Analysis in our most recently filed annual report on Form 10-K for the year ended December 31, 2008, and quarterly report on Form 10-Q for the quarter ended June 30, 2009. The forward-looking statements in this press release speak only as to the date of this release. Sensient - MORE - Source: SENSIENT TECHNOLOGIES CORP, 8-K, October 16, 2009
  • 10. Sensient Technologies Corporation Page 4 Earnings Release – Third Quarter Ended September 30, 2009 October 16, 2008 Technologies Corporation expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statements to reflect any change in its expectations upon which such statements are based. ABOUT SENSIENT TECHNOLOGIES Sensient Technologies Corporation is a leading global manufacturer and marketer of colors, flavors and fragrances. Sensient employs advanced technologies at facilities around the world to develop specialty food and beverage systems, cosmetic and pharmaceutical systems, inkjet and specialty inks and colors, and other specialty chemicals. The company’s customers include major international manufacturers representing some of the world’s best-known brands. Sensient is headquartered in Milwaukee, Wisconsin. www.sensient-tech.com - MORE - Source: SENSIENT TECHNOLOGIES CORP, 8-K, October 16, 2009
  • 11. Sensient Technologies Corporation Page 5 (In thousands, except percentages and per share amounts) Consolidated Statements of Earnings Three Months Ended September 30, Nine Months Ended September 30, 2009 2008 % Change 2009 2008 % Change Revenue $ 303,179 $ 318,601 -4.8% $ 889,962 $ 958,815 -7.2% Cost of products sold 210,103 222,705 -5.7% 615,666 665,555 -7.5% Selling and administrative expenses 54,104 55,041 -1.7% 153,683 167,919 -8.5% Operating income 38,972 40,855 -4.6% 120,613 125,341 -3.8% Interest expense 5,483 7,977 18,379 25,035 Earnings before income taxes 33,489 32,878 1.9% 102,234 100,306 1.9% Income taxes 10,660 8,776 31,979 30,067 Net earnings $ 22,829 $ 24,102 -5.3% $ 70,255 $ 70,239 0.0% Earnings per common share: Basic $ 0.47 $ 0.50 -6.0% $ 1.45 $ 1.48 -2.0% Diluted $ 0.47 $ 0.50 -6.0% $ 1.45 $ 1.46 -0.7% Average common shares outstanding: Basic 48,447 47,792 1.4% 48,299 47,554 1.6% Diluted 48,750 48,320 0.9% 48,553 48,098 0.9% Results by Segment Three Months Ended September 30, Nine Months Ended September 30, 2009 2008 % Change 2009 2008 % Change Revenue Flavors & Fragrances $ 194,805 $ 204,551 -4.8% $ 576,908 $ 609,269 -5.3% Color 94,160 102,659 -8.3% 274,974 312,771 -12.1% Corporate & Other 23,291 21,566 8.0% 63,179 66,150 -4.5% Intersegment elimination (9,077) (10,175) -10.8% (25,099) (29,375) -14.6% Consolidated $ 303,179 $ 318,601 -4.8% $ 889,962 $ 958,815 -7.2% Operating Income Flavors & Fragrances $30,678 $31,774 -3.4% $ 94,884 $ 94,290 0.6% Color 14,573 17,738 -17.8% 43,305 55,531 -22.0% Corporate & Other (6,279) (8,657) -27.5% (17,576) (24,480) -28.2% Consolidated $38,972 $40,855 -4.6% $120,613 $125,341 -3.8% - MORE - Source: SENSIENT TECHNOLOGIES CORP, 8-K, October 16, 2009
  • 12. Sensient Technologies Corporation Page 6 (In thousands, except per share amounts) Consolidated Condensed Balance Sheets September 30, 2009 2008 Current assets $ 655,125 $ 669,515 Goodwill and intangibles (net) 472,867 485,286 Property, plant and equipment (net) 420,542 416,839 Other assets 38,462 42,607 Total Assets $ 1,586,996 $ 1,614,247 Current liabilities $ 197,034 $ 224,724 Long-term debt 411,259 450,437 Accrued employee and retiree benefits 40,685 45,275 Other liabilities 29,659 28,934 Shareholders’ equity 908,359 864,877 Total Liabilities and Shareholders’ Equity $ 1,586,996 $ 1,614,247 Consolidated Statements of Cash Flows Nine Months Ended September 30, 2009 2008 Net cash provided by operating activities $ 98,583 $ 66,288 Cash flows from investing activities: Acquisition of property, plant and equipment (30,933) (34,384) Proceeds from sale of assets 4 1,946 Other investing activity (615) 1,293 Net cash used in investing activities (31,544) (31,145) Cash flows from financing activities: Proceeds from additional borrowings 216,608 40,330 Debt payments (256,991) (65,420) Dividends paid (27,743) (26,412) Proceeds from options exercised and other 8,452 15,959 Net cash used in financing activities (59,674) (35,543) Effect of exchange rate changes on cash and cash equivalents (4,785) (23) Net increase (decrease) in cash and cash equivalents 2,580 (423) Cash and cash equivalents at beginning of period 8,498 10,522 Cash and cash equivalents at end of period $ 11,078 $ 10,099 Supplemental Information Nine Months Ended September 30, 2009 2008 Depreciation and amortization $ 31,458 $ 33,828 Dividends per share $ 0.57 $ 0.55 _______________________________________________ Created by Morningstar Document Research documentresearch.morningstar.com Source: SENSIENT TECHNOLOGIES CORP, 8-K, October 16, 2009