Sensient Technologies reported diluted earnings per share of 63 cents in the third quarter, which includes restructuring costs of 9 cents per share. As adjusted, to remove the impact of the restructuring costs, diluted earnings per share were 72 cents, a third quarter record and an increase of 9.1% over the 66 cents reported in the comparable period last year.
Consolidated revenue was $372.0 million compared to $369.4 million in the third quarter of 2012. Operating income was $48.8 million, as reported, and included $6.6 million of pre-tax restructuring costs. Adjusted operating income increased 9.2% to $55.4 million compared to $50.7 million reported in last year’s third quarter.
Revenue was approximately $1.1 billion for the year to date periods in both 2013 and 2012. Diluted earnings per share, as reported, were $1.71, which includes restructuring costs of 37 cents. As adjusted, to remove the impact of the restructuring costs, diluted earnings per share were $2.08 compared to $1.94 reported in the first nine months of last year.
Cash provided by operating activities in the third quarter of 2013 was $47.7 million, an increase of 11% from the $43.1 million reported in the third quarter of 2012. For the first nine months of 2013, cash provided by operating activities increased 28% to a record level of $117.8 million compared to $92.2 million in the first nine months of 2012.
Earlier this year, the company announced that it was initiating a broad and strategic restructuring plan. The plan includes relocating the Flavors & Fragrances Group headquarters from Indianapolis to Chicago, which was completed this quarter. The plan also included consolidating several operating facilities throughout Europe and North America, and reducing the company’s global headcount. The plan is progressing as scheduled and within the company’s original cost estimates.
“The company had an outstanding quarter,” said Kenneth P. Manning, chairman and CEO of Sensient Technologies Corporation. “We are encouraged by opportunities in both the Color and Flavor businesses, and I am very optimistic about the company’s future.”
The Color Group reported revenue of $123.9 million in the third quarter of 2013, compared to $122.1 million reported in the comparable period last year. Operating income increased 10.8% in the quarter to $26.8 million from $24.2 million in last year’s third quarter. The Color Group’s operating margin increased 190 basis points to 21.7% in the third quarter, driven by strong performances across the Group. The food, pharmaceuticals, cosmetics and digital inks businesses all reported double-digit operating income growth in the quarter.
The Flavors & Fragrances Group reported quarterly revenue of $226.3 million compared to the $224.7 million reported in the comparable period last year. Operating income was $31.8 million in the third quarter of both years.
The Corporate & Other segment, which includes the company’s operations in Asia Pacific and China, and the flavor businesses in Central and South America, reported revenue of $37.6 million in the third quarter compared to $37.8 million in the comparable period last year.
Sensient is maintaining its previous guidance for 2013 diluted earnings per share, which is expected to be between $2.68 and $2.73, excluding the impact of the restructuring charge.