Beauty lets IFF fourth quarter and full year results down
The company’s fourth quarter group sales increased by 2 percent to $586m in local currency terms, which represented an increase of 9 percent in reported terms.
Net income for the period fell by 3 percent to $47.45m, a figure that was impacted by currency translations and ongoing restructuring for its European operations.
CFO Kevin Berryman said that by focusing on its key strategies and cost cutting, as well as ‘prudent working capital management', the company had managed to improve its performance significantly in the second half of the year.
Profits slide 15 percent in 2009
For the full year 2009, sales were stagnant in local currency terms to $2.3bn and down by 3 percent on a reported basis, while profits fell by 15 percent to $195.5m.
Breaking the figures down, the fragrance and beauty side of the business showed a marked under performance compared to other areas.
Total fragrance sales for the fourth quarter, which comprise both the personal care and the household products, increased by 8.6 percent on a reported basis to $315.5m, while the full year they were stagnant at $1.24bn.
However, breaking the figure down further, the full year results showed the company’s fine & beauty care division had the poorest results in the business, with sales falling 8 percent in local currency terms and 12 percent in reported terms.
Beauty retail consumption hits sales
The company said the performance was a result of declines in retail consumption as well as supply chain contraction in North America and Europe in the fine fragrance business.
But while the trend for the fragrance and fragrance ingredients business had improved significantly during the second half of 2009, particularly on account of gains in functional fragrances.
Results for the company’s beauty care sales also showed a marked turnaround in the fourth quarter, driven by increased demand for hair care and toiletries in emerging markets.
Looking ahead, Berryman said the company’s restructuring initiatives and its adaptation to the changed economic environment were likely to play an important role in returning the company back to local currency sales growth and profitability in 2010
