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Acquisitions boost IFF fragrance results

By Simon Pitman+

10-Aug-2017
Last updated on 11-Aug-2017 at 16:41 GMT2017-08-11T16:41:09Z

Acquisitions boost IFF fragrance results

IFF has reported strong growth for its second quarter results, with the fragrance side of the business benefiting from recent acquisitions and organic sales growth.

Reported net sales for the fragrance and flavors divisions combined was $849.2m, an increase of 6% compared to the corresponding quarter last year, while currency neutral results showed an increase of 8%, underlining the negative impact of currency exchange.

Reported operating profit for the period was slightly down, at $159.1 million versus $164.7 million, a figure that was impacted by negative currency exchange. On a currency neutral basis operating profit was up 6% to $171.8 million, a figure the company said underlined productivity initiatives.

Fragrance business results

On a reported basis sales for the fragrance division were up by 4% to $428.5 million, a figure that was driven by gains in fine fragrances and fragrance ingredients.

The figure was negatively impacted by currency exchange by approximately 1%, but gains also reflected the recent acquisitions of David Michael and Fragrance Resources.

Fine fragrances was the best performing segment of the business, with sales for the quarter up 10% on a reported basis, driven by double digit gains in Greater Asia, EAME and North America. While consumer fragrance sales were flat, fragrance ingredients grew by 7%, reflecting double digit gains in the EAME region from cosmetic active ingredients.

On a reported basis flavors sales increased by 9% to $414.3 million.

Outlook positive for second half of 2017

“Our second quarter results finished in line with our expectations, with improved trends across several of our key financial metrics,” said IFF Chairman and CEO Andreas Fibig.

“We continued to advance our strategy as we drove innovation, executed our productivity programs, and benefited from acquisitions. These improvements reflect significant efforts across our entire organization as we implement our long-term strategy and generate strong returns for our shareholders.”

Fibig added that the company foresees a stronger second half performance, thanks to benefits from its productivity program and continued growth in year-on-year sales.

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