1 Sensient Technologies CorporationSecond Quarter, 2017
2 Ticker Symbol & Exchange Market CapitalizationHeadquarters Milwaukee Ticker Symbol & Exchange SXT (NYSE) Market Capitalization $3.5 bn Primary Index S&P 400 Midcap Sensient Technologies sensient.com
3 Innovative Technologies Creating Unique SolutionsIn the business of innovation Create sensory driven solutions – a product’s first impression Continuously delivering product development & applications expertise Working closely with consumer products companies to extend brands & create entirely new products High-margin, high-value added sensient.com
4 Global Revenues Colors Flavors & Fragrances Asia PacificFood & Beverage Colors Personal Care Digital Inks & Technical Colors Pharmaceutical Excipients Flavors & Fragrances Sweet Savory Beverage Natural Ingredients Fragrance Bionutrients Asia Pacific sensient.com
5 Color Group Markets Served Percent of Group Revenues15% Food & Beverage Colors Personal Care Digital Inks & Technical Colors Pharmaceutical Excipients 6% 24% 55% sensient.com
6 Sensient Colors Global market leader Growing end markets Unmatched innovation & applications expertise sensient.com
7 Select Color Products & TechnologiesNatural food & beverage colors Cosmetic dyes & pigments Digital printing inks and dispersions Synthetic food & beverage colors Hair colorants Specialized pharmaceutical coatings Coloring foodstuffs Ultra-violet light protectors & solubilizers Flavors & masking agents for pharma Emulsions, lakes & dispersions Cosmetic active ingredients Dyes & colorants for pharmaceutical & nutraceutical products Inclusions Treated pigments Select Color Products & Technologies sensient.com
8 Color Competition Food & Beverage Natural Food & Beverage SyntheticCosmetic Digital Textile Inks Pharmaceutical sensient.com
9 Color Group Culled non-strategic, low margin businessHigher operating margin through mix improvement Increased operating profit Well-positioned to take advantage of strong commercial trends Operating Profit and Margins EBIT Margins in USD millions sensient.com
10 Flavors & Fragrances Group Markets Served Percent of Group Revenues14% 24% Sweet Savory Beverage Natural Ingredients Fragrance Bionutrient & Other 10% 14% 30% 8% sensient.com
11 Sensient Flavors & FragrancesBroad product offering Unique ability to service global, regional, and local customers Leading technology platforms Unmatched applications expertise sensient.com
12 Select Flavors & TechnologiesBeverage, sweet, & savory flavors Salt reduction technologies Variegates Oral care solutions Natural extracts Dehydrated onion, garlic, capsicum Inclusions Bionutrients for fermentation Botanical extracts Reaction flavors Sauces Aroma chemicals Taste masking technology Top notes Encapsulation Fabric care fragrances Mouthfeel enhancers Fruit preparations Hydrolyzed vegetable proteins Home care fragrances Sweetness enhancers Flavor bases Autolyzed yeast extracts Personal care fragrances Select Flavors & Technologies sensient.com
13 Flavors & Fragrances CompetitionBeverage Flavors & Systems Savory Flavors & Ingredients Sweet Natural Ingredients Fragrance Bionutrients sensient.com
14 Flavors & Fragrances GroupCost reductions through restructuring Culled non-strategic, low margin business Pricing and mix improvements Continue toward high-value added product portfolio and efficient cost structure to achieve 20% operating profit margin goal 20% Goal Operating Profit Margins EBIT Margins sensient.com
15 Asia Pacific Group Sales of Flavors and Colors in the Asia Pacific markets are reported as a separate segment that is managed on a geographic basis Manufacturing capabilities in Australia, New Zealand, China, Japan, Philippines; R&D capabilities in Singapore, Korea, Thailand, Indonesia, and China Annual revenues of $127 million and Operating Income of $25 million Excellent long-term growth potential sensient.com
16 Local Currency Operating Profit Growth* Local Currency Revenue Growth*Performance Metrics Local Currency Operating Profit Growth* Local Currency Revenue Growth* * Local Currency Revenue and Profit are Non-GAAP metrics, please see our GAAP to Non-GAAP Reconciliation sensient.com
17 Capital Allocation Prioritize ROI capital projectsPreserve consistent dividend payout Maintain financial flexibility to pursue M&A Excess capital returned to shareholders through opportunistic share repurchases * Payout ratio is the sum of dividends and share repurchases divided by adjusted net earnings. Adjusted net earnings are Non-GAAP metrics, please see our GAAP to Non-GAAP Reconciliation. sensient.com
18 Why Invest? Focus on improving returns and improved capital allocationStrong competitive position ‘Sticky’ business (& low portion of customer costs) Global presence Exposure to stable and growing markets sensient.com
19 Non-GAAP Financial MeasuresWithin the following tables, the Company reports certain non-GAAP financial measures, including: (1) adjusted operating income, adjusted net earnings and adjusted diluted EPS from continuing operations, which exclude restructuring and other costs, and (2) percentage changes in revenue, operating income, diluted EPS, adjusted operating income, and adjusted diluted EPS on a local currency basis, which eliminates the effects of translating the financial results of its international operations into U.S. dollars. The restructuring costs relate to eliminating underperforming operations, consolidating manufacturing facilities and improving efficiencies within the Company. The other costs in 2017 and 2016 relate to the now completed sale of a facility and certain related business lines within the Flavors & Fragrances segment in Strasbourg, France. The other costs in 2015 are acquisition related costs, and the other costs in 2014 are proxy contest related costs. The Company has included each of these non-GAAP measures in order to provide additional information regarding our underlying operating results and comparable year-over-year 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 document and in 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 the Company believes 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. sensient.com
20 The following table summarizes the percentage change in the 2017 results compared to the 2016 results for the corresponding periods in the respective financial measures. sensient.com
21 sensient.com