International Flavors & Fragrances Inc. IFF reported adjusted earnings of $1.16 per share in second-quarter 2024, which beat the Zacks Consensus Estimate of $1.01. The bottom line improved 15% from the year-ago quarter.
Including one-time items, the company reported earnings of 66 cents per share compared with the prior-year quarter’s 11 cents.
International Flavors’ net sales were $2.9 billion in the June-end quarter, down 1% year over year. The top line surpassed the Zacks Consensus Estimate of $2.82 billion. Currency-neutral sales grew 7% year over year, led by growth in Scent, Health & Biosciences and Nourish segments. The company reported volume growth in high-single digits.
International Flavors & Fragrances Inc. Price, Consensus and EPS Surprise 
International Flavors & Fragrances Inc. price-consensus-eps-surprise-chart | International Flavors & Fragrances Inc. Quote
Operational Highlights
International Flavors’ cost of goods sold was down 9% year over year to $1.82 billion. The gross profit rose 14% year over year to $1.07 billion. The gross margin was 37% compared with 31.9% in the year-ago quarter.
Research and development expenses increased 7% year over year to $173 million. The selling and administrative expenses rose 11% year over year to $493 million.
Adjusted operating EBITDA was $588 million, up 15.3% from the prior-year quarter’s $510 million. The adjusted operating EBITDA margin was 20.4% compared with the year-ago quarter’s 17.4%.
Segment Performances
Revenues in the Nourish segment dipped 5.5% year over year to $1.48 billion. The figure beat our estimate of $1.42 billion. Adjusted operating EBITDA was $232 million, up 28% year over year. Our estimate for the segment’s adjusted EBITDA was $185 million.
Revenues generated in the Health & Bioscience segment were $558 million compared with the year-earlier quarter’s $522 million. Our estimate was $532 million. Adjusted operating EBITDA was $165 million compared with $145 million in the prior-year quarter. Our estimate for the segment’s adjusted EBITDA was $146 million.
The Scent segment’s revenues were $603 million compared with the year-ago quarter’s $592 million. Our projection was $591 million. Adjusted operating EBITDA improved 17% year over year to $137 million. Our model had projected EBITDA of $130 million.
Revenues in Pharma Solutions were $250 million, down 0.4% year over year. The figure surpassed our estimate of $228 million. Adjusted operating EBITDA fell 19% year over year to $54 million. Our model had projected EBITDA to be $40 million.
Financial Position
International Flavors had cash, cash equivalents and restricted cash of $671 million at the end of the second quarter, lower than the $709 million held at the end of 2023. The long-term debt was $8.6 billion at the second-quarter end compared with $9.2 billion as of Dec 31, 2023.
International Flavors generated $336 million in cash from operating activities in the first half of 2024 compared with $375 million in the prior-year comparable period.
2024 Guidance
International Flavors expects sales to be in the range of $11.1-$11.3 billion. Its prior stated expectation was near the higher end of $10.8-$11.1 billion.
Volume is expected to be up in the band of 3-5%, reflecting improvement across all segments. IFF had earlier provided a range of 0-3%. The company expects pricing to favor sales by 1% year over year.
Adjusted EBITDA is expected to be between $2.1 billion and $2.17 billion, up from the previous guided range of $1.9 - $2.1 billion.
Price Performance
In the past year, IFF’s shares have gained 20.1% against the industry’s 8.4% decline.
Image Source: Zacks Investment Research
Zacks Rank
International Flavors currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performances of Some Consumer Staple Stocks
Kimberly-Clark Corporation KMB posted second-quarter 2024 adjusted earnings of $1.96 per share, which surpassed the Zacks Consensus Estimate of $1.68. The bottom line increased 19% year over year.
Kimberly-Clark’s sales totaled $5 billion, which missed the consensus estimate of $5.1 billion. The metric inched down 2% from the year-ago period.
Kenvue KVUE reported quarterly earnings of 32 cents per share, which came in line with the year-ago quarter. The bottom line, however, surpassed the Zacks Consensus Estimate of 28 cents per share.
Kenvue posted revenues of $4 billion compared with year-ago revenues of $4.01 billion. The top line beat the consensus estimate of $3.9 billion.
Newell Brands Inc. NWL posted earnings per share of 36 cents, up 50% from 24 cents in the year-ago quarter. The bottom-line figure also surpassed the consensus mark of 21 cents per share.
Newell Brands’ net sales declined 8.4% year over year to $1.7 billion. Nonetheless, the metric exceeded the consensus estimate of $1.6 billion.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Newell Brands Inc. (NWL) : Free Stock Analysis Report
Kimberly-Clark Corporation (KMB) : Free Stock Analysis Report
International Flavors & Fragrances Inc. (IFF) : Free Stock Analysis Report
Kenvue Inc. (KVUE) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
