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Sensient reports steady revenue climbs

16-Jul-2003

Sensient Technologies Corporation, US manufacturer of colours, flavours and fragrances, has reported $261.9 million (€233.6m) of revenue in the second quarter ended 30 June 2003, a steady increase of 9.3 per cent from the $239.6 million reported in last year's second quarter.

Meanwhile revenue for the six months ended June 30, 2003 was stronger at 9.8 per cent, climbing to $497 million, up from $452.7 million in last year's first half.

Diluted earnings per share were up 4.5 per cent to 46 cents in the second quarter versus 44 cents per share in the comparable quarter in 2002. Diluted earnings per share for the first six months increased 11.3 per cent, to 89 cents compared to 80 cents for the six months ended 30 June 2002.

"We have reported our seventh consecutive quarterly increase in revenues and diluted earnings per share," said Kenneth P. Manning, chairman, president and CEO of Sensient Technologies Corporation. "In a less than robust environment, we are not only protecting our business base but also improving our market position," he added.

On an individual basis, the Flavours & Fragrances Group revenue rose 4.6 per cent to $154.2 million in the second quarter ended June 30, 2003, compared to $147.4 million for last year's second quarter. However, operating income was lower at $22.3 million versus $23.7 million in last year's comparable quarter.

For the past six months, revenue and operating income were $293.7 million and $42.3 million, respectively, thus showing that while revenue was slightly up on last year's $281.2, operating income fell, although only by 0.9 per cent.

The growth in the Flavours and Fragrances Group revenue was explained as being driven by higher sales in Canada and Europe, although this was balanced out in part by lower sales in Mexico. Therefore. despite this growth, Sensient reported a decline in Group operating income in the quarter, blamed on the lower demand in Mexico and unfavourable margins in Spain which it claims offset significant profitability improvements elsewhere in Europe.

Meanwhile, higher sales in the European food colour segment and double-digit sales increases in Technical Colours boosted the Colour Group's quarterly revenue to $101.5 million in the second quarter of 2003, posting an increase of 16.3 per cent from $87.2 million in the previous year's quarter.

Operating income also increased by 5.2 per cent to $21.6 million compared to $20.6 million in last year's second quarter. .Sensient said this was a result of higher sales, but added that gains were reduced by expenses incurred to grow the business and to pursue new product opportunities.

During the six months ended 30 June 2003, revenue and operating income increased 17.1 per cent and 9.1 per cent, respectively, over the prior year's comparable period.

Sensient's outlook for the rest of 2003 was positive, expecting diluted earnings per share to be in the range of $1.83 to $1.86, while diluted earnings per share for third quarter 2003 are expected to be approximately 47 cents.

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