Sensient Technologies Corporation reported financial results for the third quarter ended September 30, 2023.
- Reported revenue increased 0.8% to $363.8 million versus last year’s results of $361.1 million. On a local currency basis, revenue decreased 2.0%.
- Reported operating income declined 6.2% to $44.5 million compared to $47.5 million recorded in the third quarter of 2022. On a local currency basis, operating income decreased 9.8%. Local currency adjusted EBITDA was down 7.1% in the third quarter, as a result of lower sales volumes.
- Reported diluted earnings per share was 75 cents in the third quarter of 2023 compared to 85 cents in the third quarter of 2022, a decrease of 11.8%. Local currency EPS decreased 15.3% in the third quarter as a result of lower sales volumes and higher interest expense. See segment highlights below.
Flavors & Extracts Group
The Flavors & Extracts Group reported third-quarter revenue of $191.0 million, an increase of $4.0 million versus the prior year’s third quarter. Segment operating income was $23.1 million in the current quarter, a decrease of $3.3 million compared to the prior year’s third quarter. The lower operating income was said to primarily be due to the lower volumes and higher input costs, partially offset by favorable pricing and exchange rates.
Color Group
The Color Group reported revenue of $145.0 million in the quarter, a decrease of $6.5 million compared to the prior year’s third quarter. Segment operating income was $22.9 million in the quarter, a decrease of $5.3 million compared to the prior year’s third-quarter results. The lower operating income is said to primarily be a result of the lower volumes and higher input costs, partially offset by favorable pricing and exchange rates.
Asia Pacific Group
The Asia Pacific Group reported revenue of $36.8 million, an increase of $1.6 million compared to the prior year’s third quarter. Segment operating income was $8.1 million in the quarter, an increase of $1.1 million compared to the prior year’s third quarter. Operating income is said to have benefited from higher pricing, which was offset by lower volumes and higher input costs.
Corporate & Other
Corporate & Other reported operating expenses of $9.6 million in the current quarter, compared to $14 million of operating expenses reported in the prior year’s third quarter, primarily due to lower performance-based compensation.
“As expected, the destocking headwinds and market environment impacted the quarter. Our teams continue to focus on winning new business and providing high levels of service to our customers. Our underlying business remains strong. I expect our focus on customer service and sales execution will result in a return to improved revenue growth as market dynamics improve,” said Paul Manning, Sensient’s Chairman, president and chief executive officer.
