Sensient posts strong third quarter sales
consecutive quarter of strong sales growth on the back of good
demand and price increases for its products.
The Wisconsin-based company today announced a 9.5 percent increase in sales for its third quarter ended September 30 2006 to $280.9m.
Revenue for the nine months ended September 30, 2006, rose 7.1 percent, to $826m from $771m in last year's first nine months.
"This marks Sensient's third consecutive quarter of double-digit earnings increases. Our businesses are showing excellent results with the Flavors & Fragrances Group again reporting record quarterly revenues and operating profits," said Kenneth Manning, Sensient's chairman, president and CEO.
"We are on track for an outstanding year and I expect the company's strong performance to continue into next year," he added.
Sensient said that its improved results had prompted its board of directors to increase its quarterly dividend from 15 cents to 16 cents per share.
Third quarter diluted earnings per share increased 23.3 percent to 37 cents from 30 cents in last year's third quarter.
The firm's revenue from its Flavors & Fragrances group grew 11 percent, to $189.6m in the third quarter, compared to $170.6m last year. Quarterly operating income jumped 35.5 percent to $27.4m, compared to $20.2m in the third quarter of 2005. Year-to-date revenue and operating income also increased to $548.4 million and $77.5 million, respectively.
Sensient said its Flavors & Fragrances revenue in the quarter benefited from "strong demand and improved pricing", particularly in the US.
Flavor sales in China and sales within the fragrances product line were also up. Quarterly profit was boosted by higher sales, favorable product mix and the company's cost reduction program.
The company's Color Group third quarter revenue increased 6.1 percent to $87.1m from last year's comparable quarter. Third quarter operating profit rose to $13.9m, an increase of 5.6 percent. Revenue for the past nine months increased to $266.8m and operating income was up 7 percent to $45.6m. Sensient said the group results reflect double-digit growth in the cosmetic product line, but also benefited from continued growth in food and beverage color sales and an improved cost structure.
Created more than 120 years ago, Sensient - that in 2000 changed its name from the Universal Foods corporation - over the past few years has moved from a commodity driven business into value added, more sophisticated products. In the past seven years the 3500 strong firm has secured 20 acquisitions, and more than half of its revenues are from non-US operations.
The company is present in 28 locations in Europe, and about a quarter of revenue comes from this geographical zone. The company now has a 2.8 percent global share of the fragrance and flavors market.
