Business Wire | Feb 12, 2021 06:55AM EST

Sensient Technologies Corporation Reports Results for the Quarter Ended December 31, 2020

Feb. 12, 2021

MILWAUKEE--(BUSINESS WIRE)--Feb. 12, 2021--Sensient Technologies Corporation (NYSE: SXT) reported consolidated revenue of $334.7 million in this year's fourth quarter compared to $318.6 million in last year's fourth quarter. Reported operating income in the fourth quarter of 2020 was $34.8 million compared to an operating loss of $14.5 million in the fourth quarter of 2019. Reported diluted earnings per share was 59 cents in the fourth quarter of 2020 compared to a loss per share of 40 cents in the fourth quarter of 2019. Foreign currency translation increased revenue by approximately 1% and had an immaterial impact on earnings per share in the quarter.

The 2020 fourth quarter reported results include divestiture & other related costs, operational improvement plan costs, and costs associated with a one-time COVID-19 related payment to employees, which in total decreased fourth quarter net earnings by $3.2 million ($0.07 per diluted share). The 2019 fourth quarter results include divestiture & other related costs which decreased net earnings by $43.2 million ($1.02 per diluted share). The 2020 and 2019 fourth quarter results also include the operations of the product lines divested or to be divested, which increased diluted earnings per share by $0.06 in the fourth quarter of 2020 and $0.01 in the fourth quarter of 2019. These adjustments are described in more detail under "Reconciliation of Non-GAAP Amounts" at the end of this release.

BUSINESS REVIEW



Reported

Revenue Quarter Year-to-date

Flavors & Extracts 11.8% 6.0%

Color -4.4% -6.4%

Asia Pacific 5.1% 2.5%

Total Revenue 5.0% 0.7%



Adjusted

Local Currency ^(1)

Revenue Quarter Year-to-date

Flavors & Extracts 14.0% 8.8%

Color 1.1% -0.7%

Asia Pacific 2.8% 3.0%

Total Revenue 7.9% 4.3%



^(1) Adjusted local currency percentage changes are described in more detail inthe "Reconciliation of Non-GAAP Amounts" at the end of this release.

The Flavors & Extracts Group reported fourth quarter revenue of $189.1 million compared to $169.1 million reported in the comparable period last year, an increase of 11.8%. Adjusted local currency revenue increased 14.0% in the quarter. The higher revenue was primarily the result of continued growth in natural ingredients and flavors, extracts, and flavor ingredients. Segment operating income was $23.5 million in the current quarter compared to $14.2 million reported in the comparable period last year, an increase of 65.7%. Adjusted local currency operating profit increased 54.9%. The Group's higher profit was primarily a result of the higher volumes and the favorable impact of the Group's cost reduction initiatives, offset by higher raw material costs in natural ingredients. Foreign currency translation increased segment revenue by approximately 1% and had an immaterial impact on operating income in the quarter.

The Color Group reported revenue of $119.8 million in the quarter compared to $125.4 million in last year's comparable period, a decrease of 4.4%. Adjusted local currency revenue increased 1.1% in the quarter. The Group continued to experience growth in food and pharmaceutical colors; however, this growth was offset by lower volumes in the personal care business, primarily as a result of the continued lower demand for makeup during the COVID-19 pandemic. Segment operating income was $20.5 million in the quarter compared to $19.7 million in last year's comparable period, an increase of 4.4%. Adjusted local currency operating income was up 0.5% to prior year. Despite double-digit growth rates in food and pharmaceutical colors profit, the lower volumes in personal care continued to negatively impact the Color Group's operating income in the quarter. Foreign currency translation increased segment revenue and operating income by approximately 1% in the quarter.

The Asia Pacific Group reported revenue of $32.2 million in the quarter compared to $30.6 million in last year's comparable period, an increase of 5.1%. Adjusted local currency revenue increased 2.8% in the quarter. Segment operating income was $6.0 million in the quarter compared to $5.6 million in last year's comparable quarter, an increase of 8.8%. Adjusted local currency operating income increased 7.8% in the quarter. The higher profit was primarily a result of the favorable volume growth. Foreign currency translation increased segment revenue and operating income by approximately 3% and 1%, respectively, in the quarter.

Corporate & Other reported operating costs of $15.3 million in the current quarter compared to $53.9 million in last year's comparable period. The lower costs are primarily due to lower divestiture & other costs reported in the fourth quarter of 2020 compared to the amount recorded in the fourth quarter of 2019.

Cash provided by operating activities was $75.9 million for the fourth quarter of 2020 compared to $49.6 million in the fourth quarter of 2019, an increase of 52.9%. Total debt decreased by $34.3 million during the fourth quarter of 2020.

2021 OUTLOOK

Sensient expects 2021 full year GAAP diluted earnings per share to grow at a mid to high single digit growth rate compared to the Company's 2020 reported GAAP diluted earnings per share of $2.59. Our full year 2021 guidance includes approximately 25 to 30 cents per share of estimated divestiture & other related costs, the results of the operations to be divested, and the operational improvement plan costs.

The Company expects 2021 adjusted local currency revenue (2) to grow at a low to mid-single digit rate and adjusted local currency EBITDA (2) to grow at a mid-single digit rate. The Company also expects, on a local currency basis, 2021 adjusted diluted earnings per share (2) to grow at a mid-single digit growth rate compared to the Company's 2020 adjusted diluted earnings per share of $2.79.

The Company expects earnings per share reported on a U.S. dollar basis to benefit by approximately ten cents based on current exchange rates.

The Company's guidance is based upon current trends and the effects of COVID-19 to date. The full impacts of the ongoing COVID-19 pandemic remain uncertain and management will continue to monitor its impacts on our business.

(2) See "Reconciliation of Non-GAAP Amounts" at the end of this release for more information.

USE OF NON-GAAP FINANCIAL MEASURES

The Company's non-GAAP financial measures eliminate the impact of certain items, which, depending on the measure, include, currency movements, depreciation and amortization, non-cash share-based compensation, divestiture & other related costs, operational improvement plan costs, COVID-19 employee payment costs, and the results of the operations divested or to be divested. These measures are provided to enhance the overall understanding of the Company's performance when viewed together with the GAAP results. Refer to "Reconciliation of Non-GAAP Amounts" at the end of this release.

CONFERENCE CALL

The Company will host a conference call to discuss its 2020 fourth quarter and year end financial results at 8:30 a.m. CST on Friday, February 12, 2021. To participate in the conference call, contact Chorus Call Inc. at (844) 492-3726 or (412) 317-1078, and ask to join the Sensient Technologies Corporation conference call. Alternatively, the call can be accessed by using the webcast link that is available on the Investor Information section of the Company's web site at www.sensient.com.

A replay of the call will be available one hour after the end of the conference call through February 19, 2021, by calling (877) 344-7529 and referring to conference identification number 10150402. An audio replay and written transcript of the call will also be posted on the Investor Information section of the Company's web site at www.sensient.com on or after February 16, 2021.

This release contains statements that may constitute "forward-looking statements" within the meaning of Federal securities laws including under "2021 Outlook" above. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors concerning the Company's operations and business environment. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements and that could adversely affect the Company's future financial performance include the following: the impact and uncertainty created by the ongoing COVID-19 pandemic, including, but not limited to, its effects on our employees, facilities, customers, and suppliers, the availability and cost of raw materials and other supplies, the availability of logistics and transportation, governmental regulations and restrictions and general economic conditions; the pace and nature of new product introductions by the Company and the Company's customers; the Company's ability to anticipate and respond to changing consumer preferences and changing technologies; the Company's ability to successfully implement its growth strategies; the outcome of the Company's various productivity-improvement and cost-reduction efforts, acquisition and divestiture activities, and operational improvement plan; the effectiveness of the Company's past restructuring activities; changes in costs of raw materials, including energy; industry, regulatory, legal, and economic factors related to the Company's domestic and international business; the effects of tariffs, trade barriers, and disputes; growth in markets for products in which the Company competes; industry and customer acceptance of price increases; actions by competitors; currency exchange rate fluctuations; and other factors included in "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2019, the Quarterly Report on Form 10-Q for the quarter ended September 30, 2020, and in other documents that the Company files with the SEC. The risks and uncertainties identified above are not the only risks the Company faces. Additional risks and uncertainties not presently known to the Company or that it currently believes to be immaterial also may adversely affect the Company. Should any known or unknown risks and uncertainties develop into actual events, these developments could have material adverse effects on our business, financial condition, and results of operations. This release contains time-sensitive information that reflects management's best analysis only as of the date of this release. Except to the extent required by applicable laws, the Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied herein will not be realized.

ABOUT SENSIENT TECHNOLOGIES

Sensient Technologies Corporation is a leading global manufacturer and marketer of colors, flavors, and other specialty ingredients. Sensient uses advanced technologies and robust global supply chain capabilities to develop specialized solutions for food and beverages, as well as products that serve the pharmaceutical, nutraceutical, cosmetic, and personal care industries. Sensient's customers range in size from small entrepreneurial businesses to major international manufacturers representing some of the world's best-known brands. Sensient is headquartered in Milwaukee, Wisconsin.

www.sensient.com

Sensient TechnologiesCorporation(In thousands,except percentagesand per shareamounts)(Unaudited)



Consolidated Three Months Ended December 31, Twelve Months Ended December 31,Statements ofEarnings

2020 2019 % Change 2020 2019 % Change



Revenue $ 334,668 $ 318,585 5.0% $ 1,332,001 $ 1,322,934 0.7%



Cost of 230,674 233,105 (1.0%) 908,254 908,061 0.0%products soldSelling and 69,179 99,946 (30.8%) 271,091 293,763 (7.7%)administrativeexpenses

Operating 34,815 (14,466 ) (340.7%) 152,656 121,110 26.0%income (loss)Interest 3,399 4,569 14,811 20,107 expense

Earnings 31,416 (19,035 ) 137,845 101,003 (loss) beforeincome taxesIncome taxes 6,247 (2,073 ) 28,373 18,956 (benefit)

Net earnings $ 25,169 $ (16,962 ) (248.4%) $ 109,472 $ 82,047 33.4%(loss)

Earnings per share ofcommon stock:Basic $ 0.59 $ (0.40 ) $ 2.59 $ 1.94



Diluted $ 0.59 $ (0.40 ) $ 2.59 $ 1.94



Average common sharesoutstanding:Basic 42,307 42,272 42,301 42,263



Diluted 42,404 42,272 42,346 42,294







Results by Three Months Ended December 31, Twelve Months Ended December 31,Segment

Revenue 2020 2019 % Change 2020 2019 % Change



Flavors & $ 189,060 $ 169,092 11.8% $ 742,035 $ 700,356 6.0%ExtractsColor 119,813 125,363 (4.4%) 501,018 535,159 (6.4%)

Asia Pacific 32,165 30,602 5.1% 121,227 118,248 2.5%

Intersegment (6,370 ) (6,472 ) (32,279 ) (30,829 ) elimination

Consolidated $ 334,668 $ 318,585 5.0% $ 1,332,001 $ 1,322,934 0.7%





Operating Income

Flavors & $ 23,507 $ 14,186 65.7% $ 90,974 $ 74,961 21.4%ExtractsColor 20,548 19,678 4.4% 96,034 101,190 (5.1%)

Asia Pacific 6,044 5,557 8.8% 22,075 19,382 13.9%

Corporate & (15,284 ) (53,887 ) (56,427 ) (74,423 ) Other

Consolidated $ 34,815 $ (14,466 ) (340.7%) $ 152,656 $ 121,110 26.0%



Sensient Technologies Corporation(In thousands)(Unaudited)Consolidated Condensed Balance SheetsDecember 31,

December 31,

2020

2019

Cash and cash equivalents$

24,770

$

21,153

Trade accounts receivable (net)234,132

213,201

Inventories381,346

422,517

Prepaid expenses and other current assets48,578

40,049

Assets held for sale52,760

91,293

Total Current Assets741,586

788,213

Goodwill & intangible assets (net)434,220

418,844

Property, plant, and equipment (net)445,493

437,179

Other assets119,561

95,915

Total Assets$

1,740,860

$

1,740,151

Trade accounts payable$

107,324

$

94,653

Short-term borrowings9,247

20,612

Other current liabilities82,045

66,925

Liabilities held for sale17,339

19,185

Total Current Liabilities215,955

201,375

Long-term debt518,004

598,499

Accrued employee and retiree benefits28,941

25,822

Other liabilities43,624

32,866

Shareholders' Equity934,336

881,589

Total Liabilities and Shareholders' Equity$

1,740,860

$

1,740,151

Sensient Technologies Corporation(In thousands)(Unaudited) Consolidated Condensed Balance Sheets December 31, December 31,

2020 2019

Cash and cash equivalents $ 24,770 $ 21,153

Trade accounts receivable (net) 234,132 213,201

Inventories 381,346 422,517

Prepaid expenses and other current assets 48,578 40,049

Assets held for sale 52,760 91,293

Total Current Assets 741,586 788,213

Goodwill & intangible assets (net) 434,220 418,844

Property, plant, and equipment (net) 445,493 437,179

Other assets 119,561 95,915

Total Assets $ 1,740,860 $ 1,740,151

Trade accounts payable $ 107,324 $ 94,653

Short-term borrowings 9,247 20,612

Other current liabilities 82,045 66,925

Liabilities held for sale 17,339 19,185

Total Current Liabilities 215,955 201,375

Long-term debt 518,004 598,499

Accrued employee and retiree benefits 28,941 25,822

Other liabilities 43,624 32,866

Shareholders' Equity 934,336 881,589

Total Liabilities and Shareholders' Equity $ 1,740,860 $ 1,740,151

Sensient Technologies Corporation(In thousands, except per share amounts)(Unaudited)Consolidated Statements of Cash FlowsTwelve Months Ended December 31,2020

2019

Cash flows from operating activities:Net earnings$

109,472

$

82,047

Adjustments to arrive at net cash provided by operating activities:Depreciation and amortization49,641

55,015

Share-based compensation expense (income)5,608

(739

)

Net gain on assets(252

)

(1,122

)

Net loss on divestitures and other charges6,904

44,375

Deferred income taxes(8,705

)

(19,340

)

Changes in operating assets and liabilities:Trade accounts receivable(11,357

)

10,930

Inventories46,828

25,238

Prepaid expenses and other assets(12,868

)

3,257

Accounts payable and other accrued expenses15,524

(18,251

)

Accrued salaries, wages and withholdings from employees15,140

(3,039

)

Income taxes22

(1,836

)

Other liabilities2,823

647

Net cash provided by operating activities218,780

177,182

Cash flows from investing activities:Acquisition of property, plant, and equipment(52,162

)

(39,100

)

Proceeds from sale of assets1,075

2,242

Proceeds from divesture of businesses12,595

-

Other investing activity5,071

(553

)

Net cash used in investing activities(33,421

)

(37,411

)

Cash flows from financing activities:Proceeds from additional borrowings36,667

47,083

Debt payments(154,348

)

(134,449

)

Dividends paid(66,057

)

(62,190

)

Other financing activity(415

)

(1,027

)

Net cash used in financing activities(184,153

)

(150,583

)

Effect of exchange rate changes on cash and cash equivalents2,411

64

Net increase (decrease) in cash and cash equivalents3,617

(10,748

)

Cash and cash equivalents at beginning of period21,153

31,901

Cash and cash equivalents at end of period$

24,770

$

21,153

Supplemental InformationTwelve Months Ended December 31,2020

2019

Dividends paid per share$

1.56

$

1.47

Sensient Technologies Corporation

(In thousands, except percentages and per share amounts)

(Unaudited)

Reconciliation of Non-GAAP Amounts

The Company's results for the three and twelve months ended December 31, 2020 and 2019 include adjusted revenue, adjusted operating income, adjusted net earnings, and adjusted diluted earnings per share, which exclude divestiture & other related costs, operational improvement plan costs, the results of operations divested or to be divested, and the COVID-19 employee payment.

Sensient Technologies Corporation(In thousands, except per share amounts)(Unaudited) Consolidated Statements of Cash FlowsTwelve Months Ended December 31, 2020 2019

Cash flows from operating activities:Net earnings $ 109,472 $ 82,047

Adjustments to arrive at net cash provided byoperating activities:Depreciation and amortization 49,641 55,015

Share-based compensation expense (income) 5,608 (739 )

Net gain on assets (252 ) (1,122 )

Net loss on divestitures and other charges 6,904 44,375

Deferred income taxes (8,705 ) (19,340 )

Changes in operating assets and liabilities:Trade accounts receivable (11,357 ) 10,930

Inventories 46,828 25,238

Prepaid expenses and other assets (12,868 ) 3,257

Accounts payable and other accrued expenses 15,524 (18,251 )

Accrued salaries, wages and withholdings from 15,140 (3,039 )employeesIncome taxes 22 (1,836 )

Other liabilities 2,823 647

Net cash provided by operating activities 218,780 177,182

Cash flows from investing activities:Acquisition of property, plant, and equipment (52,162 ) (39,100 )

Proceeds from sale of assets 1,075 2,242

Proceeds from divesture of businesses 12,595 -

Other investing activity 5,071 (553 )

Net cash used in investing activities (33,421 ) (37,411 )

Cash flows from financing activities:Proceeds from additional borrowings 36,667 47,083

Debt payments (154,348 ) (134,449 )

Dividends paid (66,057 ) (62,190 )

Other financing activity (415 ) (1,027 )

Net cash used in financing activities (184,153 ) (150,583 )

Effect of exchange rate changes on cash and cash 2,411 64 equivalents Net increase (decrease) in cash and cash equivalents 3,617 (10,748 )

Cash and cash equivalents at beginning of period 21,153 31,901

Cash and cash equivalents at end of period $ 24,770 $ 21,153

Supplemental InformationTwelve Months Ended December 31, 2020 2019

Dividends paid per share $ 1.56 $ 1.47

Sensient Technologies Corporation

(In thousands, except percentages and per share amounts)

(Unaudited)

Reconciliation of Non-GAAP Amounts

The Company's results for the three and twelve months ended December 31, 2020 and 2019 include adjusted revenue, adjusted operating income, adjusted net earnings, and adjusted diluted earnings per share, which exclude divestiture & other related costs, operational improvement plan costs, the results of operations divested or to be divested, and the COVID-19 employee payment.

Three Months Ended December 31, Twelve Months Ended December 31, 2020 2019 % Change 2020 2019 % Change

Revenue (GAAP) $ 334,668 $ 318,585 5.0% $ 1,332,001 $ 1,322,934 0.7%

Revenue of theproduct lines (25,163 ) (33,683 ) (113,553 ) (143,172 )divested or tobe divestedAdjusted $ 309,505 $ 284,902 8.6% $ 1,218,448 $ 1,179,762 3.3%revenue Operating $ 34,815 $ (14,466 ) (340.7%) $ 152,656 $ 121,110 26.0%income (loss)(GAAP)Divestiture &other related 4 10,567 1,795 10,567 costs - Costof productssoldDivestiture &other relatedcosts - 1,671 35,313 10,360 35,313 Selling andadministrativeexpensesOperatingincome of the (3,415 ) (745 ) (7,580 ) (1,978 )product linesdivested or tobe divestedOperationalimprovement - - 35 - plan - Cost ofproducts soldOperationalimprovementplan - Selling 698 - 3,304 - andadministrativeexpensesCOVID-19employee 1,036 - 1,036 - payment - Costof productssoldCOVID-19employeepayment - 1,986 - 1,986 - Selling andadministrativeexpensesAdjusted $ 36,795 $ 30,669 20.0% $ 163,592 $ 165,012 (0.9%)operatingincome Net earnings $ 25,169 $ (16,962 ) (248.4%) $ 109,472 $ 82,047 33.4%(loss) (GAAP)Divestiture &other related 1,675 45,880 12,155 45,880 costs, beforetaxTax impact ofdivestiture & (1,393 ) (2,671 ) (2,605 ) (2,671 )other relatedcostsNet earningsof the productlines divested (3,415 ) (745 ) (7,580 ) (1,978 )or to bedivested,before taxTax impact ofthe product 790 196 1,945 399 lines divestedor to bedivestedOperationalimprovement 698 - 3,339 - plan costs,before taxTax impact ofoperational (170 ) - (826 ) - improvementplanCOVID-19employee 3,022 - 3,022 - payment,before taxTax impact ofCOVID-19 (675 ) - (675 ) - employeepaymentAdjusted net $ 25,701 $ 25,698 0.0% $ 118,247 $ 123,677 (4.4%)earnings Dilutedearnings $ 0.59 $ (0.40 ) (247.5%) $ 2.59 $ 1.94 33.5%(loss) pershare (GAAP)Divestiture &other related 0.01 1.02 0.23 1.02 costs, net oftaxResults ofoperations ofthe product (0.06 ) (0.01 ) (0.13 ) (0.04 )lines divestedor to bedivested, netof taxOperationalimprovement 0.01 - 0.06 - plan costs,net of taxCOVID-19employee 0.06 - 0.06 - payment, netof taxAdjusteddiluted $ 0.61 $ 0.61 0.0% $ 2.79 $ 2.92 (4.5%)earnings pershare Note: Earningsper sharecalculationsmay not footdue toroundingdifferences. Results by Three Months Ended December 31,Segment Adjusted Adjusted

Revenue 2020 Adjustments 2020 2019 Adjustments ^ 2019 ^(1) (1)

Flavors & $ 189,060 $ (24,378 ) $ 164,682 $ 169,092 $ (25,308 ) $ 143,784 ExtractsColor 119,813 (766 ) 119,047 125,363 (8,412 ) 116,951

Asia Pacific 32,165 (116 ) 32,049 30,602 (149 ) 30,453

Intersegment (6,370 ) 97 (6,273 ) (6,472 ) 186 (6,286 )elimination Consolidated $ 334,668 $ (25,163 ) $ 309,505 $ 318,585 $ (33,683 ) $ 284,902

OperatingIncome Flavors & $ 23,507 $ (3,214 ) $ 20,293 $ 14,186 $ (1,039 ) $ 13,147 ExtractsColor 20,548 (158 ) 20,390 19,678 332 20,010

Asia Pacific 6,044 (43 ) 6,001 5,557 (38 ) 5,519

Corporate & (15,284 ) 5,395 (9,889 ) (53,887 ) 45,880 (8,007 )Other Consolidated $ 34,815 $ 1,980 $ 36,795 $ (14,466 ) $ 45,135 $ 30,669

Results by Twelve Months Ended December 31,Segment Adjusted Adjusted

Revenue 2020 Adjustments 2020 2019 Adjustments ^ 2019 ^(1) (1)

Flavors & $ 742,035 $ (99,543 ) $ 642,492 $ 700,356 $ (107,363 ) $ 592,993 ExtractsColor 501,018 (14,008 ) 487,010 535,159 (36,002 ) 499,157

Asia Pacific 121,227 (518 ) 120,709 118,248 (712 ) 117,536

Intersegment (32,279 ) 516 (31,763 ) (30,829 ) 905 (29,924 )elimination Consolidated $ 1,332,001 $ (113,553 ) $ 1,218,448 $ 1,322,934 $ (143,172 ) $ 1,179,762

OperatingIncome Flavors & $ 90,974 $ (8,292 ) $ 82,682 $ 74,961 $ (1,236 ) $ 73,725 ExtractsColor 96,034 871 96,905 101,190 (562 ) 100,628

Asia Pacific 22,075 (159 ) 21,916 19,382 (180 ) 19,202

Corporate & (56,427 ) 18,516 (37,911 ) (74,423 ) 45,880 (28,543 )Other Consolidated $ 152,656 $ 10,936 $ 163,592 $ 121,110 $ 43,902 $ 165,012

(1) For Revenue, adjustments consist of revenues of the product lines divested or to be divested. For Operating Income, adjustments consist of the results of the product lines divested or to be divested, divestitures & other related costs, operational improvement plan costs, and the one-time 2020 COVID-19 employee payment.^(1) For Revenue, adjustments consist of revenues of the product lines divestedor to be divested. For Operating Income, adjustments consist of the results ofthe product lines divested or to be divested, divestitures & other relatedcosts, operational improvement plan costs, and the one-time 2020 COVID-19employee payment.Sensient Technologies Corporation(In thousands, except percentages)(Unaudited)Reconciliation of Non-GAAP Amounts - ContinuedThe following table summarizes the percentage change in the 2020 results compared to the 2019 results for the corresponding periods.Three Months Ended December 31,

Twelve Months Ended December 31,

RevenueTotal

Foreign

Exchange

Rates

Adjustments (2)

Adjusted

Local

Currency

Total

Foreign

Exchange

Rates

Adjustments (2)

Adjusted

Local

Currency

Flavors & Extracts11.8%

1.1%

(3.3%)

14.0%

6.0%

(0.3%)

(2.5%)

8.8%

Color(4.4%)

0.9%

(6.4%)

1.1%

(6.4%)

(1.8%)

(3.9%)

(0.7%)

Asia Pacific5.1%

2.5%

(0.2%)

2.8%

2.5%

(0.3%)

(0.2%)

3.0%

Total Revenue5.0%

1.1%

(4.0%)

7.9%

0.7%

(0.9%)

(2.7%)

4.3%

Operating IncomeFlavors & Extracts65.7%

0.0%

10.8%

54.9%

21.4%

(0.7%)

9.0%

13.1%

Color4.4%

0.9%

3.0%

0.5%

(5.1%)

(1.6%)

(1.1%)

(2.4%)

Asia Pacific8.8%

0.9%

0.1%

7.8%

13.9%

(0.2%)

(0.2%)

14.3%

Corporate & Other(71.6%)

0.0%

(95.0%)

23.4%

(24.2%)

0.0%

(57.0%)

32.8%

Total Operating Income(340.7%)

(1.6%)

(358.3%)

19.2%

26.0%

(1.9%)

27.5%

0.4%

Diluted Earnings Per Share(247.5%)

0.0%

(247.5%)

0.0%

33.5%

(2.1%)

39.0%

(3.4%)

Adjusted EBITDA17.6%

0.7%

N/A

16.9%

2.1%

(1.1%)

N/A

3.2%

Sensient TechnologiesCorporation(In thousands, exceptpercentages)(Unaudited)



Reconciliationof Non-GAAP Amounts -Continued

The following table summarizes the percentage change in the 2020 resultscompared to the 2019 results for the corresponding periods.

Three Months Ended December 31, Twelve Months Ended December 31,

Foreign Adjusted Foreign Adjusted Adjustments AdjustmentsRevenue Total Exchange ^(2) Local Total Exchange ^(2) Local

Rates Currency Rates Currency

Flavors & 11.8% 1.1% (3.3%) 14.0% 6.0% (0.3%) (2.5%) 8.8%ExtractsColor (4.4%) 0.9% (6.4%) 1.1% (6.4%) (1.8%) (3.9%) (0.7%)

Asia Pacific 5.1% 2.5% (0.2%) 2.8% 2.5% (0.3%) (0.2%) 3.0%

Total Revenue 5.0% 1.1% (4.0%) 7.9% 0.7% (0.9%) (2.7%) 4.3%



Operating IncomeFlavors & 65.7% 0.0% 10.8% 54.9% 21.4% (0.7%) 9.0% 13.1%ExtractsColor 4.4% 0.9% 3.0% 0.5% (5.1%) (1.6%) (1.1%) (2.4%)

Asia Pacific 8.8% 0.9% 0.1% 7.8% 13.9% (0.2%) (0.2%) 14.3%

Corporate & (71.6%) 0.0% (95.0%) 23.4% (24.2%) 0.0% (57.0%) 32.8%OtherTotal (340.7%) (1.6%) (358.3%) 19.2% 26.0% (1.9%) 27.5% 0.4%OperatingIncomeDiluted (247.5%) 0.0% (247.5%) 0.0% 33.5% (2.1%) 39.0% (3.4%)Earnings PerShareAdjusted 17.6% 0.7% N/A 16.9% 2.1% (1.1%) N/A 3.2%EBITDA(2) For Revenue, adjustments consist of revenues of the product lines divested or to be divested. For Operating Income, Diluted Earnings per Share, and Adjusted EBITDA adjustments consist of the results of the product lines divested or to be divested, divestitures & other related costs, operational improvement plan costs, and the one-time 2020 COVID-19 employee payment.^(2) For Revenue, adjustments consist of revenues of the product linesdivested or to be divested. For Operating Income, Diluted Earnings perShare, and Adjusted EBITDA adjustments consist of the results of theproduct lines divested or to be divested, divestitures & other relatedcosts, operational improvement plan costs, and the one-time 2020COVID-19 employee payment.The following table summarizes the reconciliation between Operating Income (GAAP) and Adjusted EBITDA for the three and twelve months ended December 31, 2020 and 2019.Three Months Ended December 31,Twelve Months Ended December 31,2020

2019

% Change

2020

2019

% Change

Operating income (loss) (GAAP)$

34,815

$

(14,466

)

(340.7%)

$

152,656

$

121,110

26.0%

Depreciation and amortization12,810

13,309

49,641

55,015

Depreciation and amortization, product lines divested or to be divested(48

)

(570

)

(193

)

(5,065

)

Share-based compensation expense (income)1,591

77

5,608

(739

)

Divestiture & other related costs, before tax1,675

45,880

12,155

45,880

Results of operations of the product lines divested or to be divested, before tax(3,415

)

(745

)

(7,580

)

(1,978

)

Operational improvement plan costs, before tax698

-

3,339

-

COVID-19 employee payment3,022

-

3,022

-

Adjusted EBITDA$

51,148

$

43,485

17.6%

$

218,648

$

214,223

2.1%

The following table summarizes the reconciliation between Net cash provided by operating activities (GAAP) and Free Cash Flow for the three and twelve months ended December 31, 2020 and 2019.Three Months Ended December 31,Twelve Months Ended December 31,2020

2019

% Change

2020

2019

% Change

Net cash provided by operating activities (GAAP)$

75,853

$

49,601

52.9%

$

218,780

$

177,182

23.5%

Capital expenditures(18,153

)

(13,027

)

(52,162

)

(39,100

)

Free Cash Flow$

57,700

$

36,574

57.8%

$

166,618

$

138,082

20.7%

We have included each of these non-GAAP measures in order to provide additional information regarding our underlying operating results and comparable period-over-period performance. Such information is supplemental to information presented in accordance with GAAP and is not intended to represent a presentation in accordance with GAAP. These non-GAAP measures should not be considered in isolation. Rather, they should be considered together with GAAP measures and the rest of the information included in this release and our SEC filings. Management internally reviews each of these non-GAAP measures to evaluate performance on a comparative period-to-period basis and to gain additional insight into underlying operating and performance trends, and we believe the information can be beneficial to investors for the same purposes. These non-GAAP measures may not be comparable to similarly titled measures used by other companies.

Category: Earnings

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CONTACT: Amy Agallar (414) 347-3706