2023-11-06 22:14:42
International Flavors & Fragrances (IFF) IFF.N beat market expectations for third-quarter profit and sales, driven by higher prices for its food ingredients and fragrance solutions, as well as reducing the cost of inputs.
IFF has increased the prices of its products in some of its segments in order to protect its margins, as it faced higher input costs at the start of the year and a slowdown in demand for its manufacturing business. food ingredients.
Sustained demand in the fragrance and health solutions segments helped offset pressure on the food ingredients business as consumers continued to prioritize health and wellness, even in a challenging macroeconomic environment .
The company’s net sales fell 8% to $2.82 billion for the quarter ended Sept. 30, but beat market expectations ($2.77 billion), sending shares higher of the company by about 3% in extended trading.
IFF has sought to divest parts of its portfolio in order to focus on higher margin businesses.
In October, IFF sold its cosmetic ingredients unit, which includes the Lucas Meyers Cosmetics brand, to Swiss chemical company Clariant AG CLN.S for $810 million.
During the past quarter, the company also completed the divestiture of its Savory Solutions unit, which produced ingredients to add flavor, seasoning and color to artificial meats.
In October, Bloomberg News reported that IFF was working with an advisor to explore a potential sale of its pharmaceutical solutions business
Excluding items, IFF reported third-quarter earnings per share of 89 cents. Analysts on average expected a profit of 75 cents per share, according to LSEG data.
IFF reiterated its full-year sales forecast in a range of $11.3 billion to $11.6 billion.
The benefits of its inventory reduction efforts have also allowed the company to expect to be in the middle to high end of its adjusted operating Ebitda guidance range for the full year 2023, or between 1.85 billion and 2.0 billion dollars.
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