IFF’s 3Q17 Revenues Continue in Upward Trend
International Flavors and Fragrances’ 3Q17 revenues
International Flavors and Fragrances’ (IFF) revenues continued their upward trend. IFF reported revenue of $872.9 million in 3Q17, an increase of 12.3% on a year-over-year basis. In 3Q16, IFF reported revenue of $777 million. IFF’s 3Q17 revenue beat analysts’ estimates of $852.7 million and was the company’s highest quarterly revenue figure to date.
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The sales growth continued to benefit from the acquisitions of David Micahel, Fragrance Resources, and PowderPure, which helped revenues to rise by six percentage points. We’ll discuss the performances of all of the company’s segments in detail in the next few parts. Some of the businesses have shown double-digit growth. The weakness in the dollar didn’t have a major impact on IFF’s revenues.
Management commentary and guidance
Andreas Fibig, IFF’s chair and CEO, said, “Thanks in large part to our industry-leading innovation, the strength and diversity of our business and our recent acquisitions, we achieved growth in all our categories and regions. Both businesses delivered marked improvements versus the first half led by strong new win performance as well as improved volume trends. At the same time, our focus on driving greater efficiency throughout our business via cost and productivity initiatives, continued to support overall profitability.”
IFF has projected its fiscal 2017 sales will be higher in the range of 7.5% to 8.5% both on a neutral currency basis as well as on an adjusted basis. In the previous quarter, IFF provided a growth range of 6.5% to 7.5%.
The Materials Select Sector SPDR Fund (XLB) invests 1.5% of its portfolio in IFF. The fund also provides exposure to Monsanto (MON), Praxair (PX), and Air Products and Chemicals (APD) with weights of 7.2%, 5.1%, and 4.8%, respectively, as of November 7, 2017.
In the next part of this series, we’ll look into the performance of IFF’s Fragrance segment in 3Q17.