NEW YORK -- The acquisition of Bush Boake Allen and a sweeping reorganization paid dividends for International Flavors & Fragrances as it concluded its fiscal year.
For the fourth quarter ended Dec. 31, 2001, net income skyrocketed to $29.2 million, or 30 cents a diluted share, in line with analysts' estimates and more than 20 times reported income of $1.4 million, or 1 cent a share, in the final quarter of 2000. Excluding a pretax restructuring charge of $15.7 million in the fourth quarter of 2000, earnings would have been $17.1 million, or 18 cents a share, and the increase in profit would have been 70.2 percent.
Sales in the quarter reached $419.2 million, 9 percent higher than the $384.5 million reported in the 2000 quarter.
On a pro-forma basis, as if the acquisition of BBA had been concluded at the start of 2000, rather than on Nov. 3 of that year, sales would have hit $444.1 million, above the comparable 2001 figure, and the company would have registered a net loss of $1.4 million, or 1 cent a share. Excluding $21.6 million in pretax restructuring charges, net income would have been $14.3 million, or 15 cents a share, just less than half the comparable figure for the 2001 quarter.
Richard Goldstein, chairman and chief executive officer of IFF, said in a statement that the company's reorganization, announced in October 2000, yielded savings of $16 million in the fourth quarter and $40 million for the full year. "As of Jan. 1, 2002, our run rate for savings exceeded $70 million on an annualized basis," he said. "These savings enabled us to grow earnings despite the difficult sales and economic environment over the past year."
For the full year, IFF's earnings declined 5.7 percent, to $116 million, or $1.20 a diluted share, versus $123 million, or $1.22 a share, in 2000. Excluding nonrecurring pretax charges of $30.1 million in 2001 and $41.3 million in 2000, earnings would have dropped 9.8 percent, to $135.1 million, or $1.40 a diluted share, from $149.8 million, or $1.48 a share, in 2000. Sales moved ahead 26 percent, to $1.84 billion from $1.46 billion in 2000. On a pro-forma basis, 2000 net earnings would have been $83.4 million, or 82 cents a diluted share, including charges, and sales would have hit $1.88 billion.New York-based IFF projected earnings per share for the first quarter of the current year to rise 10 to 15 percent, excluding special charges.
For the full year, EPS is expected to increase 8 to 12 percent excluding charges. The projections incorporate elimination of goodwill amortization due to changes in accounting standards. These amounts would have added 9 cents a share for the first quarter of 2002 and 35 cents for the full year, the company said.
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