Sensient Technologies Corporation Reports Results for the Quarter and Year Ended December 31, 2012

  Sensient Technologies Corporation Reports Results for the Quarter and Year
  Ended December 31, 2012

    Record Revenues and Earnings per Share for the Third Consecutive Year

   Flavors & Fragrances Group Headquarters Will Relocate to Chicago in 2013

            Cost Reduction Plan Initiated in First Quarter of 2013

Business Wire

MILWAUKEE -- February 7, 2013

Sensient Technologies Corporation (NYSE: SXT) reported record revenue and
earnings per share for 2012. Consolidated revenue was $1.5 billion in 2012,
compared to $1.4 billion in 2011. Diluted earnings per share increased to
$2.49 for the year, up from $2.41 reported in 2011. In local currency, 2012
revenue increased by 5% and diluted earnings per share increased by 6%, as
foreign currency translation reduced reported earnings by seven cents per
share for the year. Consolidated operating income was $191.2 million in 2012
compared to $190.8 million reported in 2011. In local currency, operating
income increased by 3% for the year.

Consolidated revenue for the fourth quarter of 2012 was $356.2 million, a
fourth quarter record and an increase of 4.7% over the $340.4 million reported
in last year’s fourth quarter. Earnings per share were 55 cents in the fourth
quarter of 2012 compared to 57 cents in the fourth quarter of 2011. The impact
of foreign currency translation was less than one percent in the fourth
quarter for revenue, operating income and earnings per share.

Cash provided by operating activities in 2012 was $139.4 million, compared to
$142.9 million in 2011. Total debt as of December 31, 2012, was $354.0 million
compared to $335.4 million as of December 31, 2011. The Company’s total debt
to total capital ratio improved to 23.5% on December 31, 2012, from 24.2% at
the end of last year.

The Company is initiating a broad strategic and restructuring plan in the
first quarter of 2013. One component of the plan will focus on relocating the
Flavors & Fragrances Group headquarters, technical groups, and North American
management to Chicago. The relocation of the Flavors & Fragrances Group
headquarters will give the Company better access to its customers, improve its
access to food industry talent, improve access to worldwide air service and
allow it to showcase its broad product portfolio in a state-of-the-art
facility. The Company expects to incur personnel and moving related costs
between $12 million and $14 million over the next 12 to 18 months as a result
of this relocation. This plan does not anticipate the relocation of the
Indianapolis production site.

The second component of the plan will generate operating efficiencies
throughout the Company. The plan will reduce headcount and consolidate several
facilities throughout Europe and North America. The Company expects to reduce
its global headcount by more than 200 employees, and consolidate several
manufacturing sites during the next twelve months. These changes will not
impact the Company’s sales coverage, and will result in a more efficient
utilization of our human and capital resources. We expect to incur
approximately $10 million in one-time personnel related costs and $8 million
of one-time non-cash costs related to the write-down of assets and other costs
during the next twelve months. The Company expects to reduce its annual
operating costs by about $10 million as a result of these changes.

“We achieved record revenues and earnings for a third consecutive year despite
a very challenging environment,” said Kenneth P. Manning, Chairman and CEO of
Sensient Technologies Corporation. “We increased our dividend, repurchased
shares and continued to reinvest in our business during 2012. The Company is
strong and the 2013 restructuring activities will give us better access to our
customers, increase our efficiencies and improve our operating margins. We
continue to see growth opportunities and I am very optimistic about the
Company’s future.”

                               BUSINESS REVIEW

The Color Group reported record revenue of $494.1 million in 2012, up from
$491.9 million in 2011. Operating income grew to $94.1 million, an all-time
high and an increase of 4.3% over the $90.2 million reported in 2011. In local
currency, revenue increased by 4.1% and operating income grew by 8.0% during
2012. The Color Group’s operating margin was 19.0% in 2012, an increase of 70
basis points over the 2011 result of 18.3%. The record results for 2012 were
driven by strong performances from the North American food and beverage
business and the digital inks business.

The Color Group reported revenue of $114.3 million in the fourth quarter, up
from $112.8 million reported in last year’s fourth quarter. Operating income
was $19.1 million in the fourth quarter of 2012, compared to $20.3 million in
the fourth quarter of 2011. Foreign currency translation reduced both revenue
and operating income by approximately one percent in the fourth quarter.

The Flavors & Fragrances Group also reported record revenue of $875.3 million
in 2012, up from $857.5 million in 2011. Operating income was $123.0 million
in 2012 compared to $129.4 million in 2011. Foreign currency translation
reduced revenue by approximately three percent and operating income by one
percent in 2012.

In the fourth quarter, the Flavors & Fragrances Group reported revenue of
$216.9 million, an increase of 5.6% over the $205.4 million reported in last
year’s fourth quarter. Operating income was $28.7 million in the quarter
compared to $31.8 million in the fourth quarter of 2011. Foreign currency
translation did not have a significant impact on revenue and increased
operating income by approximately one percent.

The Corporate & Other segment, which includes the Company’s operations in Asia
Pacific and China, and certain flavor businesses in Central and South America,
reported revenue of $156.8 million in 2012, an increase of 9.2% from the
$143.6 million reported in 2011. Revenue was $40.4 million in the fourth
quarter of 2012, up 15.2% over the $35.1 million reported in last year’s
fourth quarter. Foreign currency translation did not significantly impact
revenue for either the year or the fourth quarter.

                                 2013 OUTLOOK

Sensient expects 2013 diluted earnings per share, excluding the restructuring
charges, to be within a range of $2.64 and $2.72.

                               CONFERENCE CALL

The Company will host a conference call to discuss its 2012 fourth quarter and
full year financial results at 10:00 a.m. CST on Friday, February 8, 2013. To
make a reservation for the conference call, please contact InterCall
Teleconferencing at (706) 645-6973 and refer to the Sensient Technologies
Corporation conference call.

A replay will be available beginning at 1:00 p.m. CST on February 8, 2013,
through midnight on February 15, 2013, by calling (404) 537-3406 and referring
to conference identification number 91449690. A transcript of the call will
also be posted on the company’s web site at www.sensient.com after the call
concludes.

This release contains forward-looking statements (as that term is defined in
the Private Securities Litigation Reform Act of 1995) that reflect
management’s current assumptions and estimates of future economic
circumstances, industry conditions, company performance and financial results.
A variety of factors could cause the Company’s actual results and experience
to differ materially from the anticipated results, including, but not limited
to the factors noted in this press release and in the Management’s Discussion
and Analysis in our most recently filed annual report on Form 10-K for the
year ended December 31, 2011, and quarterly report on Form 10-Q for the
quarter ended September 30, 2012. The forward-looking statements in this press
release speak only as to the date of this release. Sensient Technologies
Corporation expressly disclaims any obligation or undertaking to release
publicly any updates or revisions to such statements to reflect any change in
its expectations upon which such statements are based.

                         ABOUT SENSIENT TECHNOLOGIES

Sensient Technologies Corporation is a leading global manufacturer and
marketer of colors, flavors and fragrances. Sensient employs advanced
technologies at facilities around the world to develop specialty food and
beverage systems, cosmetic and pharmaceutical systems, inkjet and specialty
inks and colors, and other specialty and fine chemicals. The Company’s
customers include major international manufacturers representing most of the
world’s best-known brands. Sensient is headquartered in Milwaukee, Wisconsin.

www.sensient.com

Sensient Technologies Corporation
(In thousands, except percentages and per share amounts)
                                                                                   
                                                                                            
                                                                                            
Consolidated
Statements of         Three Months Ended December 31,       Twelve Months Ended December 31,
Earnings
                                                                                            
                      2012          2011          %         2012            2011            %
                                                  Change                                    Change
                                                                                            
Revenue               $ 356,242     $ 340,358     4.7   %   $ 1,459,050     $ 1,430,789     2.0   %
                                                                                            
Cost of                 245,979       232,221     5.9   %     995,907         981,137       1.5   %
products sold
Selling and
administrative         70,543      65,187     8.2   %    271,935       258,829      5.1   %
expenses
                                                                                            
Operating               39,720        42,950      -7.5  %     191,208         190,823       0.2   %
income
Interest               3,665       4,520                 16,901        19,439    
expense
                                                                                            
Earnings before         36,055        38,430      -6.2  %     174,307         171,384       1.7   %
income taxes
Income taxes           8,834       9,844                 50,399        50,900    
                                                                                            
Net earnings          $ 27,221     $ 28,586     -4.8  %   $ 123,908      $ 120,484      2.8   %
                                                                                            
Earnings per
common share:
        Basic         $ 0.55       $ 0.57       -3.5  %   $ 2.50         $ 2.42         3.3   %
                                                                                            
        Diluted       $ 0.55       $ 0.57       -3.5  %   $ 2.49         $ 2.41         3.3   %
                                                                                            
Average common
shares
outstanding:
        Basic          49,538      49,814     -0.6  %    49,596        49,746       -0.3  %
                                                                                            
        Diluted        49,737      50,013     -0.6  %    49,822        49,937       -0.2  %
                                                                                            
                                                                                            
                                                                                            
                                                                                            
Results by            Three Months Ended December 31,       Twelve Months Ended December 31,
Segment
                                                                                            
Revenue               2012          2011          %         2012            2011            %
                                                  Change                                    Change
                                                                                            
                                                                                            
Flavors &             $ 216,933     $ 205,397     5.6   %   $ 875,281       $ 857,460       2.1   %
Fragrances
Color                   114,294       112,843     1.3   %     494,145         491,881       0.5   %
Corporate &             40,369        35,050      15.2  %     156,812         143,565       9.2   %
Other*
Intersegment           (15,354 )    (12,932 )   18.7  %    (67,188   )    (62,117   )   8.2   %
elimination
                                                                                            
Consolidated          $ 356,242    $ 340,358    4.7   %   $ 1,459,050    $ 1,430,789    2.0   %
                                                                                            
                                                                                            
                                                                                            
Operating
Income
                                                                                            
                                                                                            
Flavors &             $ 28,663      $ 31,802      -9.9  %   $ 122,997       $ 129,436       -5.0  %
Fragrances
Color                   19,128        20,331      -5.9  %     94,058          90,217        4.3   %
Corporate &            (8,071  )    (9,183  )   -12.1 %    (25,847   )    (28,830   )   -10.3 %
Other*
                                                                                            
Consolidated          $ 39,720     $ 42,950     -7.5  %   $ 191,208      $ 190,823      0.2   %

* Beginning in the first quarter of 2012, the results of operations for
certain flavor locations in Central and South America, previously reported in
the Flavors & Fragrances Group, are reported in the Corporate & Other segment.
Results for 2011 have been restated to reflect this change.

Sensient Technologies Corporation
(In thousands, except per share amounts)
                                                           
                                                                 
Consolidated Condensed Balance
Sheets
December 31,                                     2012            2011
                                                                 
Current assets                                   $ 751,354       $ 706,870
Goodwill and intangibles                           462,896         457,025
(net)
Property, plant and equipment                      514,708         451,539
(net)
Other assets                                      47,685        38,730    
                                                                 
        Total Assets                             $ 1,776,643    $ 1,654,164 
                                                                 
Current liabilities                              $ 204,236       $ 207,275
Long-term debt                                     333,979         312,422
Accrued employee and retiree                       60,527          52,252
benefits
Other liabilities                                  24,003          33,005
Shareholders' equity                              1,153,898     1,049,210 
                                                                 
        Total Liabilities and                    $ 1,776,643    $ 1,654,164 
        Shareholders' Equity
                                                                 
                                                                 
                                                                 
Consolidated Statements of
Cash Flows
Twelve Months Ended December                     2012            2011
31,
                                                                 
Net cash provided by operating                   $ 139,366      $ 142,877   
activities
                                                                 
Cash flows from investing
activities:
        Acquisition of property, plant             (103,806  )     (72,200   )
        and equipment
        Proceeds from sale of                      1,364           2,076
        assets
        Acquisition of new businesses, net         -               (3,706    )
        of cash acquired
        Other investing                           (242      )    (207      )
        activity
                                                                 
Net cash used in investing                        (102,684  )    (74,037   )
activities
                                                                 
Cash flows from financing
activities:
        Proceeds from additional                   73,903          184,074
        borrowings
        Debt payments                              (58,052   )     (198,259  )
        Purchase of treasury                       (23,154   )     -
        stock
        Dividends paid                             (43,426   )     (41,968   )
        Proceeds from options                     1,957         3,205     
        exercised and other
                                                                 
Net cash used in financing                        (48,772   )    (52,948   )
activities
                                                                 
Effect of exchange rate changes on cash           4,297         (7,292    )
and cash equivalents
                                                                 
Net (decrease) increase in cash and                (7,793    )     8,600
cash equivalents
Cash and cash equivalents at beginning            22,855        14,255    
of period
Cash and cash equivalents at end                 $ 15,062       $ 22,855    
of period
                                                                 
                                                                 
                                                                 
Supplemental Information
Twelve Months Ended December                     2012            2011
31,
                                                                 
Depreciation and amortization                    $ 48,352        $ 46,099
                                                                 
Dividends per share                              $ 0.87          $ 0.84

Contact:

Sensient Technologies Corporation
Dick Hobbs, (414) 347-3706
 
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