Fragrance supplier International Flavors & Fragrances Inc. reported second-quarter profits leapt 39.7 percent to $67.2 million, or 83 cents a diluted share, from $48.1 million, or 60 cents a share, on revenues that were up 17.2 percent to $665.8 million, from $568.3 million in the same period last year.
Net earnings for the quarter ended June 30 were reduced by a 2-cent-a-share expense related to ongoing restructuring efforts in Europe, the firm noted, adding that, excluding this item, adjusted EPS was 85 cents, beating by 3 cents average estimates by Wall Street analysts, according to Yahoo Finance.
“It is clear that the strong momentum we experienced in the beginning of the year continued into the second quarter,” stated Doug Tough, chairman and chief executive officer. He added the firm “was successful in winning key new business” even while IFF has “benefited from some elements of restocking and favorable prior-year comparisons.”
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However, he noted, “As we enter the second half of 2010, it is important to note that the benefits of restocking have begun to subside. When combined with stronger prior year comparisons, we expect local currency sales in the second half to return to more normalized levels, with relative strength in the third quarter versus the fourth.”
Excluding a $2 million charge related to the restructuring efforts in Europe, adjusted operating profit for IFF’s fragrance division grew almost 60 percent to $67 million. Fragrance sales accounted for more than half of quarterly revenues, coming in at $361.5 million, up 21.1 percent from $298.5 million in the second quarter last year. The flavors division saw sales of $304.3 million.
The New York-based firm said its fine fragrance and beauty care (hair care and toiletries) businesses grew in the “very strong double-digits.” Functional fragrance also performed well, IFF stated, driven by strong trends in fabric care and double-digit growth in home care.
Year-to-date profits were up 37.4 percent to $130.9 million, or $1.63 a share, versus $95.3 million, or $1.20 a share, in the first six months last year on sales of $1.32 billion, up 17 percent from $1.13 billion.