International Flavors & Fragrances
posted net income that beat Street expectations for the fourth quarter, thanks to overseas demand and strong pricing.
Net income at the New York-based company was $49 million, or 62 cents a share, from $47.2 million, or 58 cents a share, a year earlier.
The four analysts polled by Thomson Reuters were expecting EPS of 47 cents. Sales were negatively impacted by currency rates and dropping 3% to $539.1 million from $553.5 million.
Shares were recently trading $4.14, or 14.9% higher, to $32.
Excluding items, fourth-quarter adjusted EPS was 50 cents in 2008 vs. 53 cents in the fourth quarter of 2007. The 2008 fourth-quarter reported EPS includes a 22-cent benefit related to prior years' tax settlements and a 10-cent restructuring charge pertaining to a performance improvement plan initiated during the quarter. The 2007 fourth quarter reported EPS included a 5-cent a share gain on an asset sale.
On a comparable basis, excluding items from both periods, 2008 full-year adjusted EPS of $2.76 is 4% above the prior year adjusted EPS of $2.66.
"I am generally pleased with our 2008 financial performance, especially in light of the challenging economic and market conditions we faced this year," said Robert M. Amen, chairman and chief executive officer. "Our Flavors business continues to outperform our competition and is well-positioned for future growth. Our Fragrances business improved its performance in the fourth quarter but ended the year slightly below 2007 results. Excellent progress was made in some areas of the Fragrances business, especially in Greater Asia and Fragrance Ingredients, but we have additional opportunities to improve.
"Margin pressure increased through most of 2008 as a result of higher input costs and weaker sales mix. In the fourth quarter, we were able to largely mitigate these factors and reduce the year-over-year gap in operating margins through internal improvements and cost recovery initiatives. Importantly, we made good progress against many of our strategic initiatives. I remain cautiously optimistic about 2009."
This article was written by a staff member of TheStreet.com.