Sensient Technologies Reports Results for Quarter, Year Ended Dec. 31, 2017

Sensient Technologies reported earnings per share from continuing operations of 31 cents in the fourth quarter of 2017 compared to 70 cents in last year’s fourth quarter. Revenue was $328.9 million in this year’s fourth quarter compared to $330.2 million in the comparable period last year. Operating income was $47.4 million in the fourth quarter of 2017 and $43.3 million in last year’s fourth quarter. Foreign currency translation increased revenue by approximately 3%, operating income by approximately 2% and earnings per share by approximately 1% in the fourth quarter.
 
For the year ended Dec. 31, 2017, earnings per share from continuing operations were $2.03 compared to $2.74 for the year ended Dec. 31, 2016. Revenue was approximately $1.4 billion in both 2017 and 2016. Operating income was $167.8 million and $185.6 million for the years ended Dec. 31, 2017 and 2016, respectively.
 
For the year ended Dec. 31, 2017, adjusted earnings per share from continuing operations were $3.42, an increase of approximately 6.5%, from last year’s result of $3.21. Adjusted operating income was $215.9 million for the full year of 2017 compared to $211.7 million in the comparable period last year.
 
Cash provided by operating activities was $69.4 million in the fourth quarter of 2017 compared to $71.9 million in the fourth quarter of 2016. The 2017 and 2016 cash flow results included proceeds of $20 million and $40 million, respectively, from accounts receivable securitization transactions. The Company repurchased 300,000 shares of its common stock in the fourth quarter of 2017 and approximately 1.1 million shares for the full year. Including dividend payments, the company returned approximately $140 million to shareholders in 2017.
 
Business Review
 
The Color Group reported revenue of $126.2 million in the quarter and $119.7 million in last year’s fourth quarter, an increase of 5.4%. Segment operating income increased 11.4% to $25.5 million in the quarter from $22.9 million in last year’s fourth quarter. The Group’s higher profit was driven by continued strong results in Cosmetics and solid performances by the Food Color businesses in North America and Asia.
 
For the full year, the Color Group reported revenue of $526.4 million, an increase of 4.4% from $504.1 million reported in the comparable period last year. Segment operating income increased 7.2% to $113.4 million compared to $105.8 million reported in 2016.
 
The Flavors & Fragrances Group reported fourth quarter revenue of $178.5 million compared to $187.1 million reported in the comparable period last year. Segment operating income was $24.1 million in the fourth quarter compared to $28.6 million reported in the fourth quarter of 2016.
 
The Flavors & Fragrances Group reported revenue of $746.9 million and $795.8 million for the full years of 2017 and 2016, respectively. Segment operating income was $114.3 million in 2017 and $124.1 million in 2016. The impact of the two divestitures that occurred in the first quarter of this year, decreased revenue by approximately 3% in 2017.
 
The Asia Pacific Group reported revenue of $31.9 million, an increase of 3.7% compared to $30.8 million reported in the comparable period last year. Segment operating income was $6.0 million and $6.1 million in the fourth quarters of 2017 and 2016, respectively.
 
“The company delivered adjusted earnings per share growth of 6.5%, and the Color Group had a strong year,” said Paul Manning, chairman, president and CEO of Sensient Technologies. “With our restructuring now complete, I am confident Sensient will deliver strong results in 2018, and I remain very optimistic about the company’s future.”