Sensient Technologies (SXT) Tops Q1 EPS by 1c; Reaffirms FY19 EPS Guidance Above Consensus

Sensient Technologies (NYSE: SXT) reported Q1 EPS of $0.78, $0.01 better than the analyst estimate of $0.77. Revenue for the quarter came in at $347.5 million versus the consensus estimate of $348.8 million.

“I am confident that our overall results will continue to improve throughout the year. We expect continued growth in flavors and natural colors and we expect to overcome the impact of higher input costs as the year progresses,” said Paul Manning, Chairman, President and CEO of Sensient Technologies Corporation.

GUIDANCE:

Sensient Technologies sees FY2019 EPS of $3.55, versus the consensus of $3.31.

The Company reaffirms its previously issued local currency segment growth and earnings per share guidance for 2019.

The Company previously described three headwinds that will impact the comparison of 2019 results relative to 2018 results for consolidated operating income and earnings per share. The first headwind relates to higher Corporate expense as a result of higher non-cash stock-based compensation in 2019 compared to 2018, which is now anticipated to be approximately ten to twelve cents of diluted earnings per share for the full year. The second headwind relates to a higher tax rate, which is still anticipated to be approximately 24 cents for the full year. The third headwind relates to currency, which is still expected to reduce diluted earnings per share by approximately five cents for the full year.

These headwinds will cause reported operating income and reported earnings per share to decline 8% to 11% in comparison to 2018 reported diluted earnings per share of $3.70 and cause adjusted diluted earnings per share to be down 4% to 7% in comparison to 2018 adjusted diluted earnings per share of $3.55. Diluted earnings per share as reported in US dollars are expected to be down a further 1% to 2%, or about five cents per share below local currency earnings per share.

As a result of these headwinds, in 2019, the Company introduced the metric of Adjusted EBITDA(2) as a supplemental measure of the performance of the Company’s underlying business in 2019. This metric represents EBITDA before non-cash stock-based compensation. The Company’s local currency guidance for this metric is mid-single digit growth in 2019.

For earnings history and earnings-related data on Sensient Technologies (SXT) click here.

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