Sensient Technologies Revenues Up 6% in Q4

For the twelve months ended December 31, 2009, Sensient's reported diluted earnings per share, which include the charges, were $1.78. Consolidated revenue for 2009 was $1.2 billion compared to $1.3 billion in 2008.

9 Feb 2010 --- Sensient Technologies Corporation reported that consolidated revenue for the fourth quarter of 2009 reached $311.5 million, an increase of 6.0% over the prior year's comparable period. Diluted earnings per share for the quarter were 47 cents prior to the previously announced settlement charges of 14 cents per share. Fourth quarter diluted earnings per share, as reported, were 33 cents and included charges for the proposed settlements and related legal costs, net of insurance reimbursements, related to environmental claims against a company that Sensient acquired more than twenty years ago. The pre-tax charges of $11.3 million were reported in the Corporate and Other operating segment. Prior year fourth quarter diluted earnings per share were 43 cents.

Without the fourth quarter charges of 14 cents per share, 2009 earnings would have been $1.92 per share. For the twelve months ended December 31, 2009, Sensient's reported diluted earnings per share, which include the charges, were $1.78. Consolidated revenue for 2009 was $1.2 billion compared to $1.3 billion in 2008.

For the twelve months ended December 31, 2009, foreign currency translation reduced consolidated revenue and operating income by 4.3% and 5.6%, respectively. In the fourth quarter of 2009, foreign currency translation began to add to revenue and operating income as the U.S. dollar weakened compared to its level in the prior year's fourth quarter. In the fourth quarter of 2009, foreign currency translation added 5.5% and 5.3% to revenue and operating income, respectively.

Cash provided by operating activities for the twelve months ended December 31, 2009, reached a record level of $138.3 million, compared to prior year cash flow of $87.0 million. Total debt at December 31, 2009, was $428.0 million, a reduction of $51.9 million since the beginning of the year.

"Sensient's business has held up well throughout this year's difficult economic environment," said Kenneth P. Manning, Chairman and CEO of Sensient Technologies Corporation. "Our strong cash flow and low debt levels have allowed us to continue to invest in our business, which will enhance our ability to grow in the future."

BUSINESS REVIEW

Fourth quarter revenue for the Flavors & Fragrances Group was $196.0 million, an increase of 2.3% compared to fourth quarter 2008 revenue of $191.5 million. Quarterly operating income increased 1.4%, to $29.6 million in comparison to prior year income of $29.2 million. Group results reflect local currency revenue and profit growth in Latin America and Europe. Quarterly results also benefited from favorable foreign currency translation that added 4.9% and 3.4% to revenue and profit, respectively. Quarterly revenue and profit gains were partially offset by pricing adjustments in certain markets in advance of raw material cost savings that are anticipated in 2010.

Annual revenue for the Flavors & Fragrances Group was $772.9 million in 2009, compared to $800.8 million in 2008. Operating income in 2009 rose to $124.5 million, compared to $123.5 million in 2008. Higher pricing in 2009 more than offset the impact of increased raw material costs. Operating margins in 2009 improved 70 basis points, to 16.1%, as a result of improved pricing. Year to date results were negatively impacted by unfavorable foreign currency comparisons, which reduced revenue and profit by approximately 4%.

Fourth quarter revenue for the Color Group increased 11.4%, to $99.8 million, compared to 2008 fourth quarter revenues of $89.6 million. Color Group operating income in the fourth quarter of 2009 was $15.4 million, compared to operating income of $16.1 million in the prior year's quarter. Quarterly results benefited from favorable foreign currency translation that added 5.7% and 5.2% to revenue and profit, respectively. The Group's food and beverage colors delivered local currency sales growth in Europe and Latin America. Sales in certain of the Group's non-food product lines also showed growth in the quarter. Group profits for the quarter were lower partly due to unfavorable product mix.

The Color Group's revenue for the twelve months ended December 31, 2009, was $374.8 million in comparison to last year's revenue of $402.4 million. Operating income for 2009 was $58.7 million in comparison to prior year income of $71.6 million. Revenue and profits in 2009 were reduced by soft demand and customer inventory destocking. The impact of unfavorable foreign currency translation also reduced revenue and operating income by approximately 6%.