Profits were off at International Flavors & Fragrances as higher restructuring and interest expenses impacted first-quarter results.
Net earnings for the quarter ended March 31 came in at $55.9 million, a 10.8 percent decline from $62.7 million in the same period a year ago. Earnings per diluted share remained the same, at 69 cents, missing Wall Street analysts’ estimates of 74 cents a share. Excluding the charges incurred by IFF, earnings per diluted share would have been 75 cents, the firm stated.
Quarterly revenues were up 5.4 percent to $596.6 million, from $566.1 million in the same period a year ago.
Net sales of the firm’s fragrance business were flat at $322.8 million, but operating earnings within the fragrance division were down 20.4 percent to $46.9 million from $58.9 million in the same period a year ago.
“Our fragrance business results were mixed,” stated Robert M. Amen, IFF’s chairman and chief executive officer. “Functional fragrance sales were strong in Asia and Europe, although this performance was offset by weakness in global fine fragrance and North America functional fragrance sales.”
Amen noted during a conference call with analysts that rising costs of raw materials remained a concern.
“2008 is and will likely remain a challenging year,” said Amen. “The greatest challenge remains the U.S.” He added, however, that he was “pleased” with the firm’s current performance and future prospects in the “fast-growing economies” of emerging markets.