IFF reports strong sales gains from developing markets

IFF reported strong sales and profits growth in Q4 for both its fragrance and flavors divisions on the back of big gains in its Latin America and Greater Asia markets.

The company said that its sales revenue grew by 8 percent during the quarter to reach $629.87m, a figure that was negatively impacted by foreign currency exchange by 1 percent.

Net income increased by 17 percent to $55.57m, a figure that would have been higher had it not been for the impact of costs related to company restructuring as well as the rising cost of raw materials.

Fragrance sales not as dynamic as flavors

In the company's fragrance division, which serves the cosmetics and personal care industry, local currency sales increased 5 percent on a report basis to $331.6m and 8 percent on a local currency basis. Flavors sales were up 10 percent on a reported basis.

Fourth quarter sales for the fragrance division were underlined by double-digit growth in both the fine fragrance and beauty care division – which was up by 13 percent on a reported basis and 16 percent in local currency terms.

Meanwhile the results for the functional fragrance division slipped by 1 percent on a reported basis, while fragrance ingredients sales gained 6 percent in reported terms.

New business and volume gains drive growth

The company underlined the fact that the gains in both the developing markets and the beauty and fragrance divisions were down to a combination of new business and increased volumes from existing customers.

“As we enter 2011, we are optimistic in our ability to deliver local currency sales and EPS growth in line with our long-term financial targets and a margin profile that is approaching our long-term target,” said Doug Tough, IFF CEO.

For the full year the company said that reported sales were up 13 percent to $2.6bn, a figure that was not impacted by currency fluctuations, which meant that local sales were also up by 13 percent. Net income increased 35 percent to $263.56m.