International Flavors & Fragrances Inc. (IFF – Free Report) reported adjusted earnings of 97 cents per share in fourth-quarter 2024, beating the Zacks Consensus Estimate of 78 cents. The bottom line improved 35% from the year-ago quarter.
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Including one-time items, the company reported a loss of 18 cents per share compared with the prior-year quarter’s loss of $10.21.
International Flavors & Fragrances Inc. Price, Consensus and EPS Surprise
International Flavors & Fragrances Inc. price-consensus-eps-surprise-chart | International Flavors & Fragrances Inc. Quote
International Flavors’ net sales were $2.77 billion in the December-end quarter, up 2.5% from the year-ago quarter. The top line surpassed the Zacks Consensus Estimate of $2.67 billion. In the quarter, currency-neutral sales were up 6%, aided by growth across all segments.
International Flavors’ Q4 Gross Margin Improves Y/Y
In the reported quarter, International Flavors’ cost of goods sold was down 2.8% year over year to $1.79 billion. Gross profit rose 14% to $980 million. The gross margin came in at 35.4% compared with 31.8% in the year-ago quarter.
Research and development expenses increased 8.3% year over year to $170 million. Selling and administrative expenses rose 16.4% to $517 million in the fourth quarter. Adjusted operating EBITDA came in at $471 million, up 2.2% from the prior-year quarter’s $461 million. The adjusted operating EBITDA margin was 17% compared with the year-ago quarter’s 17.1%.
IFF’s Q4 Segmental Performances
Sales in the Nourish segment grew 1.2% year over year to $1.41 billion in the December-end quarter. On a comparable basis, currency-neutral sales rose 4%. The figure beat our estimate of $1.37 billion. The upside was driven by double-digit growth in Flavors, partially negated by softness in the Functional Ingredients business.
The segment’s adjusted operating EBITDA was $170 million, up 3% year over year. Our estimate for the segment’s adjusted EBITDA was $160 million.
Sales generated in the Health & Bioscience segment were $553 million compared with the year-earlier quarter’s $528 million. Currency-neutral sales rose 6% on a comparable basis. Growth was aided by a double-digit performance in Home & Personal Care, and Grain Processing businesses. Our estimate was $538 million for the same.
The adjusted operating EBITDA was $157 million in the quarter compared with $162 million in the prior-year quarter. Our model had projected an EBITDA of $152 million for the segment.
The Scent segment’s sales were $579 million compared with the year-ago quarter’s $578 million. Currency-neutral sales improved 7%, led by double-digit growth in Fragrance Ingredient, high-single-digit growth in Fine Fragrance and mid-single-digit growth in Consumer Fragrance. The figure surpassed our estimate of $546 million.
The segment’s adjusted operating EBITDA decreased 10.2% year over year to $97 million. The figure missed our projection of $101 million.
Sales in Pharma Solutions were $228 million in the fourth quarter, up 12.3% year over year. The segment’s sales, per our model, were $203 million. Currency-neutral sales improved 12%, led by growth in the Core Pharma and Industrial businesses. The adjusted operating EBITDA surged 80.8% year over year to $47 million on higher volumes and productivity improvements. The figure beat our projection of $24 million.
International Flavors’ Q4 Cash Flow & Balance Sheet Updates
IFF had cash and cash equivalents of $469 million at the end of 2024, down from $703 million at the end of 2023. Long-term debt was $7.56 billion at the 2024 end compared with $9.19 billion at the 2023 end.
International Flavors utilized $1.07 billion in cash in operating activities in 2024, up from $1.44 billion in the prior year.
IFF’s 2024 Performance
The company reported adjusted earnings of $4.31 per share in 2024, beating the Zacks Consensus Estimate of $4.15. The bottom line improved 29% from 2023. Including one-time items, the company reported earnings of 95 cents per share against the prior year’s loss of $10.05.
International Flavors’ net sales were $11.48 billion in 2024, flat year over year. The top line surpassed the Zacks Consensus Estimate of $11.38 billion. In the year, currency-neutral sales rose 6%. The upside was driven by double-digit growth in the Scent segment, high-single-digit growth in the Health & Biosciences segment, and a mid-single-digit increase in the Nourish segment.
International Flavors’ 2025 Guidance
The company expects sales for fiscal 2025 between $10.6 billion and $10.9 billion. Volume growth is anticipated across all businesses. Adjusted EBITDA is expected between $2 billion and $2.15 billion.
IFF Stock’s Price Performance
In the past year, the company’s shares have gained 7.2% against the industry’s decline of 17.4%.
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International Flavors’ Zacks Rank
IFF currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Performance of Other Chemical – Specialty Stocks in Q4
Axalta Coating Systems Ltd. (AXTA – Free Report) reported earnings of 60 cents per share in the fourth quarter of 2024, up from 46 cents a year ago. It surpassed the Zacks Consensus Estimate of 51 cents.
AXTA’s sales rose around 1% year over year to $1,311 million in the quarter. It beat the Zacks Consensus Estimate of $1,296.5 million. The top line includes a 1% headwind from foreign currency swings.
Linde plc’s (LIN – Free Report) adjusted earnings for the fourth quarter of 2024 were $3.97 per share, surpassing the Zacks Consensus Estimate of $3.93. The bottom line improved from the year-ago quarter’s profit of $3.59.
Total quarterly sales of $8.28 billion missed the Zacks Consensus Estimate of $8.36 billion and declined from the year-ago quarter’s $8.30 billion. LIN’s strong quarterly earnings were primarily driven by higher pricing and volumes from the Americas segment.
Ecolab Inc.’s (ECL – Free Report) adjusted earnings in fourth-quarter 2024 were $1.81 per share, up from $1.55 a year ago. The figure surpassed the Zacks Consensus Estimate of $1.79.
ECL reported net sales of $4.01 billion for the quarter, beating the Zacks Consensus Estimate of $3.96 billion. The company’s top line increased 1.7% year over year.
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