Yahoo Finance What's in Store for International Flavors' (IFF) Q1 Earnings?
International Flavors & Fragrances Inc. IFF is scheduled to report first-quarter 2023 results on May 8, after the closing bell.
Q4 Performance
In the last reported quarter, International Flavors’ earnings surpassed estimates, while revenues missed the same. On a year-over-year basis, earnings and revenues declined. The company has surpassed earnings estimates in three of the trailing four quarters and missed in one, the average surprise being 11.3%.
Q4 Estimates
The Zacks Consensus Estimate for first-quarter revenues is pegged at $3.03 billion, indicating a decline of 6.1% from the year-ago reported figure. The Zacks Consensus Estimate for the March-end quarter’s earnings per share is pegged at 90 cents, suggesting a year-over-year decline of 46.8%.
International Flavors & Fragrances Inc. Price and EPS Surprise
International Flavors & Fragrances Inc. price-eps-surprise | International Flavors & Fragrances Inc. Quote
Key Factors to Note
International Flavors has been bearing the brunt of unfavorable foreign exchange and persisting inflation, as well as the current challenging operating environment. Based on current market foreign exchange rates, International Flavors expected foreign exchange to negatively impact sales growth and adjusted operating EBITDA growth in the quarter to be reported. The company also anticipated volume growth to be limited throughout 2023.
The headwinds are expected to have been partially offset by favorable markets for flavors and fragrances, supported by the demand for various consumer products and growth in emerging markets. Greater efficiencies throughout the business on costs and productivity initiatives, margin improvement, and acquisition-related synergies are likely to have driven growth in the quarter under review quarter.
The Nourish segment has been delivering strong results, primarily driven by the Flavors, Ingredients and Food Design businesses. However, these tailwinds are likely to have been offset by lower volumes in the to-be-reported quarter. The Zacks Consensus Estimate for the segment’s sales for the fourth quarter is pegged at $1,665 million, indicating a 3.8% year-over-year fall. The consensus mark for the segment’s operating EBITDA is pegged at $224 million, whereas it reported $329 million in the prior-year quarter.
The Scent segment has been witnessing sustained strength in Cosmetic Actives and Consumer Fragrances. Volumes have significantly picked up in the Fine Fragrance business, with consumer behavior returning to normal levels. The Zacks Consensus Estimate for the segment’s sales for the first quarter is pegged at $585 million, suggesting no change from the year-ago quarter’s actual. The estimate for operating EBITDA for the segment is pegged at $96 million, indicating a year-over-year decline of 17.2%.
The Zacks Consensus Estimate for the Health & Biosciences segment’s sales for the first quarter is pegged at $539 million, suggesting a year-over-year decline of 18.5%. The estimate for the segment’s operating EBITDA is pegged at $127 million, implying a 33.8% dip from the year-ago quarter’s reported figure.
Strong growth in Industrial Pharma and the ongoing recovery in demand in Pharma are expected to have supported the Pharma Solutions segment in the to-be-reported quarter. The Zacks Consensus Estimate for the segment’s first-quarter sales is pegged at $254 million, whereas it reported $249 million in the prior-year quarter. The estimate for the segment’s operating EBITDA is pegged at $47.50 million, indicating a year-over-year increase of 26.9%.
High raw material, energy and labor costs are likely to have impacted the company’s margins in the first quarter. Manufacturing expenses are anticipated to have been higher due to the company’s efforts to meet the current high demand levels.
Labor shortages and supply-chain disruptions are likely to have impacted the company’s production in the to-be-reported quarter. Despite its pricing actions and cost-reduction efforts, these factors are likely to have weighed on the company’s margins in the quarter under review.
Earnings Whispers
Our proven model doesn’t conclusively predict an earnings beat for International Flavors this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for International Flavors is -1.48%.
Zacks Rank: International Flavors currently carries a Zacks Rank #3. You can see the complete list of today's Zacks #1 Rank stocks here.
Price Performance
In the past year, International Flavors’ shares have lost 21.1% compared with the industry’s fall of 19.2%.
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Stocks to Consider
Here are some Consumer Staples stocks, which, according to our model, have the right combination of elements to post an earnings beat in their upcoming releases:
TreeHouse Foods, Inc. THS, scheduled to release first-quarter 2023 earnings on May 8, has an Earnings ESP of +19.75% and a Zacks Rank of 3.
The consensus estimate for TreeHouse Foods’ first-quarter earnings has been unchanged in the past 60 days. The Zacks Consensus Estimate for THS’ earnings for the quarter is pegged at 39 cents.
Celsius Holdings, Inc. CELH, scheduled to release first-quarter 2023 earnings on May 9, currently has an Earnings ESP of +32.28% and a Zacks Rank of 3.
The Zacks Consensus Estimate for Celsius’ first-quarter earnings has moved north by 5% in the past 60 days. The consensus estimate for CELH’s earnings for the first quarter is pegged at 21 cents.
Kellogg Company K, scheduled to release first-quarter earnings on May 4, has an Earnings ESP of +0.17%. K currently carries a Zacks Rank of 3.
The Zacks Consensus Estimate for Kellogg’s first-quarter earnings is pegged at $1.00. The Zacks Consensus Estimate for the company’s first-quarter earnings has been unchanged in the past 60 days.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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International Flavors & Fragrances Inc. (IFF) : Free Stock Analysis Report
Kellogg Company (K) : Free Stock Analysis Report
TreeHouse Foods, Inc. (THS) : Free Stock Analysis Report
Celsius Holdings Inc. (CELH) : Free Stock Analysis Report
