On successfully completing the first phase of development,
International Flavors & Fragrances Inc.
) extended its collaboration with
) into the second phase for the development of specific renewable
The association between the two companies can be traced back to
Apr 2013, when a long-term agreement was signed to develop
sustainable fragrance ingredients. Then, International Flavors
& Fragrances reserved the right to use renewable fragrance
ingredients in the flavors and fragrances sector, while Amyris
was allowed to use the same in other sectors.
Using the expertise of Amyris in developing renewable products,
International Flavors & Fragrances is hopeful of developing
the fragrance ingredients. Apart from being cost-effective, these
molecules will enable the company to meet the growing demand in
the flavors and fragrances market.
International Flavors & Fragrances maintains an exhaustive
research and development wing that focuses on the development of
new and innovative compounds. The company spent nearly $260
million or 9% of total sales in 2013 on research and development
activities. This reflects an increase over $234 million and $220
million spent in 2012 and 2011, respectively.
The company, in Jan 2014, acquired privately held Aromor Flavors
and Fragrances Ltd., a specialist in producing and selling
complex specialty ingredients used primarily in perfume,
cosmetics and food industries. Aromor will be integrated into the
company's Fragrances Ingredients business and is anticipated to
contribute 1% to core sales growth and be accretive to earnings
Over the long term, International Flavors & Fragrances hopes
to achieve around 4-6% local currency sales growth and over 10%
earnings per share growth. Sales growth at Flavors and Fragrances
is anticipated to be 2-3% above industry growth. Emphasis will be
given on capital spending over the years to seize upon
opportunities in the emerging markets. As a percentage of sales,
capital spending is anticipated to be roughly 4-5% in 2013-2015
and roughly 3% in 2016-2018.
On Feb 25, Shares of International Flavors & Fragrances
increased 0.3% over the previous day's closing price.
International Flavors & Fragrances currently has a market
capitalization of $7.5 billion and carries a Zacks Rank #2 (Buy).
Other similarly-ranked stocks in the industry include
Globe Specialty Metals, Inc.
AMYRIS INC (AMRS): Free Stock Analysis Report
GLOBE SPECIALTY (GSM): Free Stock Analysis
INTL F & F (IFF): Free Stock Analysis
NEWMARKET CORP (NEU): Free Stock Analysis
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