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Yahoo
6 days ago
- Business
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Sensient Technologies Corporation Reports Results for the Quarter Ended June 30, 2025
MILWAUKEE, July 25, 2025--(BUSINESS WIRE)--Sensient Technologies Corporation (NYSE: SXT), a leading provider of flavors and colors for the food, pharmaceutical, and personal care markets, today reported financial results for the second quarter ended June 30, 2025. Second Quarter Consolidated Results Reported revenue increased 2.7% to $414.2 million in the second quarter of 2025 versus last year's second quarter results of $403.5 million. On a local currency basis(1), revenue increased 2.1%. Reported operating income increased 16.2% to $57.7 million compared to $49.7 million recorded in the second quarter of 2024. In the second quarter of 2025, the Company recorded $3.3 million of costs related to its Portfolio Optimization Plan versus last year's $1.8 million in the second quarter. Local currency adjusted operating income(1) and local currency adjusted EBITDA(1) increased 16.9% and 14.1%, respectively, in the second quarter. Reported earnings per share increased 20.5% to 88 cents in the second quarter of 2025 compared to 73 cents in the second quarter of 2024. Local currency adjusted diluted EPS(1) increased 20.8% in the second quarter. "Sensient continued to build on a strong first quarter. Our results are a testament to our relentless focus on customer service and innovation. I remain very confident about our performance in 2025 and beyond," said Paul Manning, Sensient's Chairman, President, and Chief Executive Officer. Second Quarter Group Results Reported Local Currency(1) Revenue Quarter Year-to-Date Quarter Year-to-Date Flavors & Extracts -2.8% -1.3% -3.2% -0.9% Color 6.9% 5.9% 6.6% 7.4% Asia Pacific 10.8% 7.3% 7.6% 6.2% Total Revenue 2.7% 2.3% 2.1% 3.1% Reported Local Currency Adjusted(1) Operating Income Quarter Year-to-Date Quarter Year-to-Date Flavors & Extracts 8.8% 7.2% 8.6% 7.5% Color 23.6% 16.8% 22.1% 17.8% Asia Pacific 13.5% 10.4% 8.0% 7.5% Total Operating Income 16.2% 12.3% 16.9% 13.6% The Flavors & Extracts Group reported second quarter 2025 revenue of $203.3 million, a decrease of $6.0 million versus the prior year's second quarter. The Group's revenue was unfavorably impacted by lower volumes in natural ingredients, partially offset by higher volumes in our flavors, extracts, and flavor ingredients product lines. Segment operating income was $28.5 million in the second quarter of 2025, an increase of $2.3 million compared to the prior year's second quarter. The segment operating income increased despite the decline in segment revenues due to strong profitability of the flavors, extracts, and flavor ingredients product lines. The Color Group reported revenue of $179.3 million in the second quarter of 2025, an increase of $11.6 million compared to the prior year's second quarter. The Group's revenue increase was driven by strong growth in the food and pharmaceutical product lines. Segment operating income was $38.9 million in the second quarter of 2025, an increase of $7.4 million compared to the prior year's second quarter results. The Asia Pacific Group reported revenue of $42.7 million in the second quarter of 2025, an increase of $4.2 million compared to the prior year's second quarter. The Group's revenue increased across nearly all geographies. Segment operating income was $8.9 million in the quarter, an increase of $1.1 million compared to the prior year's second quarter. Corporate & Other reported operating expenses of $18.7 million in the second quarter of 2025, compared to $15.9 million of operating expenses reported in the prior year's second quarter. The higher operating expenses were primarily due to higher Portfolio Optimization Plan costs in the quarter. Local currency adjusted operating expenses(1) for Corporate & Other increased $1.1 million compared to the prior year's second quarter, primarily due to higher performance-based compensation costs recorded in 2025. 2025 OUTLOOK Metric Current Guidance Prior Guidance Local Currency Revenue(1) Mid-Single-Digit Growth Mid-Single-Digit Growth Local Currency Adjusted EBITDA(1) High Single-Digit Growth Mid-Single-Digit to High Single-Digit Growth Diluted EPS (GAAP) Between $3.13 and $3.23* Between $3.13 and $3.23 Local Currency Adjusted Diluted EPS(1) High Single-Digit to Double-Digit Growth High Single-Digit to Double-Digit Growth *Includes approximately 20 cents of Portfolio Optimization Plan costs. Based on current exchange rates, foreign currency impact is expected to be a slight tailwind for the year. The Company's guidance is based on current conditions and economic and market trends in the markets in which the Company operates and is subject to various risks and uncertainties as described below. (1) Please refer to "Reconciliation of Non-GAAP Amounts" at the end of this release for more information regarding our non-GAAP financial measures. USE OF NON-GAAP FINANCIAL MEASURES The Company's non-GAAP financial measures eliminate the impact of certain items, which, depending on the measure, include: currency movements, depreciation and amortization, Portfolio Optimization Plan costs, and non-cash share-based compensation. These measures are provided to enhance the overall understanding of the Company's performance when viewed together with the GAAP results. Refer to "Reconciliation of Non-GAAP Amounts" at the end of this release. CONFERENCE CALL The Company will host a conference call to discuss its 2025 second quarter financial results at 8:30 a.m. CDT on Friday, July 25, 2025. To participate in the conference call, contact Chorus Call Inc. at (844) 492-3726 or (412) 317-1078, and ask to join the Sensient Technologies Corporation conference call. Alternatively, the call can be accessed by using the webcast link that is available on the Investor Information section of the Company's web site at A replay of the call will be available one hour after the end of the conference call through August 1, 2025, by calling (877) 344-7529 and using access code 2167989. An audio replay and written transcript of the call will also be posted on the Investor Information section of the Company's web site at on or after July 29, 2025. This release contains statements that may constitute "forward-looking statements" within the meaning of Federal securities laws including in the quote from our Chairman, President, and Chief Executive Office and under "2025 Outlook" above. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, and other factors concerning the Company's operations and business environment. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements and that could adversely affect the Company's future financial performance include the following: the Company's ability to manage general business, economic, and capital market conditions, including actions taken by customers in response to such market conditions, and the impact of recessions and economic downturns; the impact of macroeconomic and geopolitical volatility, including inflation and shortages impacting the availability and cost of raw materials, energy, and other supplies, disruptions and delays in the Company's supply chain, and the conflicts between Russia and Ukraine and in the Middle East; industry, regulatory, legal, and economic factors related to the Company's domestic and international business; the effects of tariffs, trade barriers, and disputes; the availability and cost of labor, logistics, and transportation; the pace and nature of new product introductions by the Company and the Company's customers; the Company's ability to anticipate and respond to changing consumer preferences, changing technologies, and changing regulations; the Company's ability to successfully implement its growth strategies; the outcome of the Company's various productivity-improvement and cost-reduction efforts, acquisition and divestiture activities, and Portfolio Optimization Plan; growth in markets for products in which the Company competes; industry and customer acceptance of price increases; actions by competitors; the Company's ability to enhance its innovation efforts and drive cost efficiencies; currency exchange rate fluctuations; and other factors included in "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, and in other documents that the Company files with the SEC. The risks and uncertainties identified above are not the only risks the Company faces. Additional risks and uncertainties not presently known to the Company or that it currently believes to be immaterial also may adversely affect the Company. Should any known or unknown risks and uncertainties develop into actual events, these developments could have material adverse effects on our business, financial condition, and results of operations. This release contains time-sensitive information that reflects management's best analysis only as of the date of this release. Except to the extent required by applicable laws, the Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied herein will not be realized. ABOUT SENSIENT TECHNOLOGIES Sensient Technologies Corporation is a leading global manufacturer and marketer of colors, flavors, and other specialty ingredients. Sensient uses advanced technologies and robust global supply chain capabilities to develop specialized solutions for food and beverages, as well as products that serve the pharmaceutical, nutraceutical, and personal care industries. Sensient's customers range in size from small entrepreneurial businesses to major international manufacturers representing some of the world's best-known brands. Sensient is headquartered in Milwaukee, Wisconsin. Sensient Technologies Corporation (In thousands, except percentages and per share amounts) (Unaudited) Consolidated Statements of Earnings Three Months Ended June 30, Six Months Ended June 30, 2025 2024 % Change 2025 2024 % Change Revenue $ 414,230 $ 403,525 2.7 % $ 806,555 $ 788,195 2.3 % Cost of products sold 271,398 272,803 (0.5 %) 531,946 530,924 0.2 % Selling and administrative expenses 85,126 81,065 5.0 % 163,373 158,208 3.3 % Operating income 57,706 49,657 16.2 % 111,236 99,063 12.3 % Interest expense 7,391 7,653 14,732 14,698 Earnings before income taxes 50,315 42,004 96,504 84,365 Income taxes 12,728 11,072 24,455 22,493 Net earnings $ 37,587 $ 30,932 21.5 % $ 72,049 $ 61,872 16.4 % Earnings per share of common stock: Basic $ 0.89 $ 0.73 $ 1.71 $ 1.47 Diluted $ 0.88 $ 0.73 $ 1.69 $ 1.46 Average common shares outstanding: Basic 42,246 42,154 42,221 42,129 Diluted 42,575 42,398 42,522 42,351 Results by Segment Three Months Ended June 30, Six Months Ended June 30, Revenue 2025 2024 % Change 2025 2024 % Change Flavors & Extracts $ 203,251 $ 209,213 (2.8 %) $ 396,932 $ 402,305 (1.3 %) Color 179,282 167,700 6.9 % 347,032 327,725 5.9 % Asia Pacific 42,744 38,580 10.8 % 84,645 78,886 7.3 % Intersegment elimination (11,047 ) (11,968 ) (22,054 ) (20,721 ) Consolidated $ 414,230 $ 403,525 2.7 % $ 806,555 $ 788,195 2.3 % Operating Income Flavors & Extracts $ 28,506 $ 26,209 8.8 % $ 53,495 $ 49,887 7.2 % Color 38,922 31,502 23.6 % 73,774 63,181 16.8 % Asia Pacific 8,943 7,880 13.5 % 18,385 16,656 10.4 % Corporate & Other (18,665 ) (15,934 ) (34,418 ) (30,661 ) Consolidated $ 57,706 $ 49,657 16.2 % $ 111,236 $ 99,063 12.3 % Sensient Technologies Corporation (In thousands) (Unaudited) Consolidated Condensed Balance Sheets June 30, December 31, 2025 2024 Cash and cash equivalents $ 56,686 $ 26,626 Trade accounts receivable 333,951 290,087 Inventories 619,595 600,302 Prepaid expenses and other current assets 54,221 44,871 Fixed assets held for sale 1,629 - Total Current Assets 1,066,082 961,886 Goodwill & intangible assets (net) 451,942 423,658 Property, plant, and equipment (net) 515,469 491,587 Other assets 171,068 146,663 Total Assets $ 2,204,561 $ 2,023,794 Trade accounts payable $ 121,442 $ 139,052 Short-term borrowings 26,280 19,848 Other current liabilities 103,402 111,739 Total Current Liabilities 251,124 270,639 Long-term debt 710,119 613,523 Accrued employee and retiree benefits 26,865 24,499 Other liabilities 59,332 54,147 Shareholders' Equity 1,157,121 1,060,986 Total Liabilities and Shareholders' Equity $ 2,204,561 $ 2,023,794 Sensient Technologies Corporation (In thousands, except per share amounts) (Unaudited) Consolidated Statements of Cash Flows Six Months Ended June 30, 2025 2024 Cash flows from operating activities: Net earnings $ 72,049 $ 61,872 Adjustments to arrive at net cash provided by operating activities: Depreciation and amortization 30,334 29,725 Share-based compensation expense 6,639 4,911 Net loss (gain) on assets 76 (195 ) Portfolio Optimization Plan costs 1,274 1,495 Deferred income taxes 2,711 529 Changes in operating assets and liabilities: Trade accounts receivable (30,293 ) (49,449 ) Inventories (548 ) 36,730 Prepaid expenses and other assets (11,028 ) (6,612 ) Trade accounts payable and other accrued expenses (17,578 ) (22,722 ) Accrued salaries, wages, and withholdings (15,129 ) 7,824 Income taxes (937 ) (6,591 ) Other liabilities 1,734 1,429 Net cash provided by operating activities 39,304 58,946 Cash flows from investing activities: Acquisition of property, plant, and equipment (38,035 ) (22,850 ) Proceeds from sale of assets 56 296 Acquisition of new business (4,867 ) - Other investing activities 1,354 (336 ) Net cash used in investing activities (41,492 ) (22,890 ) Cash flows from financing activities: Proceeds from additional borrowings 106,484 132,189 Debt payments (43,148 ) (120,571 ) Dividends paid (34,700 ) (34,685 ) Other financing activities (2,648 ) (3,016 ) Net cash provided by (used in) financing activities 25,988 (26,083 ) Effect of exchange rate changes on cash and cash equivalents 6,260 (8,568 ) Net increase in cash and cash equivalents 30,060 1,405 Cash and cash equivalents at beginning of period 26,626 28,934 Cash and cash equivalents at end of period $ 56,686 $ 30,339 Supplemental Information Six Months Ended June 30, 2025 2024 Dividends paid per share $ 0.82 $ 0.82 Sensient Technologies Corporation (In thousands, except percentages and per share amounts) (Unaudited) Reconciliation of Non-GAAP Amounts The Company's results for the three and six months ended June 30, 2025 and 2024 include adjusted operating income, adjusted net earnings, and adjusted diluted earnings per share, which, in each case, exclude Portfolio Optimization Plan costs. Three Months Ended June 30, Six Months Ended June 30, 2025 2024 % Change 2025 2024 % Change Operating income (GAAP) $ 57,706 $ 49,657 16.2 % $ 111,236 $ 99,063 12.3 % Portfolio Optimization Plan costs – Cost of products sold 1,789 207 3,603 314 Portfolio Optimization Plan costs – Selling and administrative expenses 1,550 1,545 2,600 4,250 Adjusted operating income $ 61,045 $ 51,409 18.7 % $ 117,439 $ 103,627 13.3 % Net earnings (GAAP) $ 37,587 $ 30,932 21.5 % $ 72,049 $ 61,872 16.4 % Portfolio Optimization Plan costs, before tax 3,339 1,752 6,203 4,564 Tax impact of Portfolio Optimization Plan costs(1) (815 ) (214 ) (1,517 ) (569 ) Adjusted net earnings $ 40,111 $ 32,470 23.5 % $ 76,735 $ 65,867 16.5 % Diluted earnings per share (GAAP) $ 0.88 $ 0.73 20.5 % $ 1.69 $ 1.46 15.8 % Portfolio Optimization Plan costs, net of tax 0.06 0.04 0.11 0.09 Adjusted diluted earnings per share $ 0.94 $ 0.77 22.1 % $ 1.80 $ 1.56 15.4 % Note: Earnings per share calculations may not foot due to rounding differences. (1) Tax impact adjustments were determined based on the nature of the underlying non-GAAP adjustments and their relevant jurisdictional tax rates. Results by Segment Three Months Ended June 30, Adjusted Adjusted Operating Income 2025 Adjustments(2) 2025 2024 Adjustments(2) 2024 Flavors & Extracts $ 28,506 $ - $ 28,506 $ 26,209 $ - $ 26,209 Color 38,922 - 38,922 31,502 - 31,502 Asia Pacific 8,943 - 8,943 7,880 - 7,880 Corporate & Other (18,665 ) 3,339 (15,326 ) (15,934 ) 1,752 (14,182 ) Consolidated $ 57,706 $ 3,339 $ 61,045 $ 49,657 $ 1,752 $ 51,409 Results by Segment Six Months Ended June 30, Adjusted Adjusted Operating Income 2025 Adjustments(2) 2025 2024 Adjustments(2) 2024 Flavors & Extracts $ 53,495 $ - $ 53,495 $ 49,887 $ - $ 49,887 Color 73,774 - 73,774 63,181 - 63,181 Asia Pacific 18,385 - 18,385 16,656 - 16,656 Corporate & Other (34,418 ) 6,203 (28,215 ) (30,661 ) 4,564 (26,097 ) Consolidated $ 111,236 $ 6,203 $ 117,439 $ 99,063 $ 4,564 $ 103,627 (2) Adjustments consist of Portfolio Optimization Plan costs. Sensient Technologies Corporation (Unaudited) Reconciliation of Non-GAAP Amounts - Continued The following table summarizes the percentage change in the 2025 results compared to the 2024 results for the corresponding periods. Three Months Ended June 30, 2025 Revenue Total ForeignExchangeRates Adjustments(3) LocalCurrencyAdjusted Flavors & Extracts (2.8 %) 0.4 % N/A (3.2 %) Color 6.9 % 0.3 % N/A 6.6 % Asia Pacific 10.8 % 3.2 % N/A 7.6 % Total Revenue 2.7 % 0.6 % N/A 2.1 % Operating Income Flavors & Extracts 8.8 % 0.2 % 0.0 % 8.6 % Color 23.6 % 1.5 % 0.0 % 22.1 % Asia Pacific 13.5 % 5.5 % 0.0 % 8.0 % Corporate & Other 17.1 % 0.0 % 9.0 % 8.1 % Total Operating Income 16.2 % 1.9 % (2.6 %) 16.9 % Diluted Earnings Per Share 20.5 % 1.3 % (1.6 %) 20.8 % Adjusted EBITDA 15.4 % 1.3 % N/A 14.1 % Six Months Ended June 30, 2025 Revenue Total ForeignExchangeRates Adjustments(3) LocalCurrencyAdjusted Flavors & Extracts (1.3 %) (0.4 %) N/A (0.9 %) Color 5.9 % (1.5 %) N/A 7.4 % Asia Pacific 7.3 % 1.1 % N/A 6.2 % Total Revenue 2.3 % (0.8 %) N/A 3.1 % Operating Income Flavors & Extracts 7.2 % (0.3 %) 0.0 % 7.5 % Color 16.8 % (1.0 %) 0.0 % 17.8 % Asia Pacific 10.4 % 2.9 % 0.0 % 7.5 % Corporate & Other 12.3 % 0.0 % 4.2 % 8.1 % Total Operating Income 12.3 % (0.3 %) (1.0 %) 13.6 % Diluted Earnings Per Share 15.8 % 0.0 % (0.2 %) 16.0 % Adjusted EBITDA 11.7 % (0.4 %) N/A 12.1 % (3) Adjustments consist of Portfolio Optimization Plan costs. Sensient Technologies Corporation (In thousands, except percentages) (Unaudited) Reconciliation of Non-GAAP Amounts - Continued The following table summarizes the reconciliation between Operating Income (GAAP) and Adjusted EBITDA for the three and six months ended June 30, 2025 and 2024. Three Months Ended June 30, Six Months Ended June 30, 2025 2024 % Change 2025 2024 % Change Operating income (GAAP) $ 57,706 $ 49,657 16.2 % $ 111,236 $ 99,063 12.3 % Depreciation and amortization 15,260 15,016 30,334 29,725 Share-based compensation expense 3,739 2,916 6,639 4,911 Portfolio Optimization Plan costs, before tax 3,339 1,752 6,203 4,564 Adjusted EBITDA $ 80,044 $ 69,341 15.4 % $ 154,412 $ 138,263 11.7 % The following table summarizes the reconciliation between Debt (GAAP) and Net Debt, and Operating Income (GAAP) and Credit Adjusted EBITDA for the trailing twelve months ended June 30, 2025 and 2024. June 30, Debt 2025 2024 Short-term borrowings $ 26,280 $ 26,995 Long-term debt 710,119 634,663 Credit Agreement adjustments(4) (43,393 ) (18,034 ) Net Debt $ 693,006 $ 643,624 Operating income (GAAP) $ 203,752 $ 151,657 Depreciation and amortization 60,938 58,955 Share-based compensation expense 11,812 9,078 Portfolio Optimization Plan costs, before tax 8,270 32,405 Other non-operating gains(5) (816 ) (872 ) Credit Adjusted EBITDA $ 283,956 $ 251,223 Net Debt to Credit Adjusted EBITDA 2.4x 2.6x (4) Adjustments include cash and cash equivalents, as described in the Company's Fourth Amended and Restated Credit Agreement (Credit Agreement), and certain letters of credit and hedge contracts. (5) Adjustments consist of certain financing transaction costs, certain non-financing interest items, and gains and losses related to certain non-cash, non-operating, and/or non-recurring items as described in the Credit Agreement. We have included each of these non-GAAP measures in order to provide additional information regarding our underlying operating results and comparable period-over-period 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 release and 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 we believe 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. Category: Earnings Source: Sensient Technologies Corporation View source version on Contacts David Plautz(414)
Business Wire
6 days ago
- Business
- Business Wire
Sensient Technologies Corporation Reports Results for the Quarter Ended June 30, 2025
MILWAUKEE--(BUSINESS WIRE)--Sensient Technologies Corporation (NYSE: SXT), a leading provider of flavors and colors for the food, pharmaceutical, and personal care markets, today reported financial results for the second quarter ended June 30, 2025. Second Quarter Consolidated Results Reported revenue increased 2.7% to $414.2 million in the second quarter of 2025 versus last year's second quarter results of $403.5 million. On a local currency basis (1), revenue increased 2.1%. Reported operating income increased 16.2% to $57.7 million compared to $49.7 million recorded in the second quarter of 2024. In the second quarter of 2025, the Company recorded $3.3 million of costs related to its Portfolio Optimization Plan versus last year's $1.8 million in the second quarter. Local currency adjusted operating income (1) and local currency adjusted EBITDA (1) increased 16.9% and 14.1%, respectively, in the second quarter. Reported earnings per share increased 20.5% to 88 cents in the second quarter of 2025 compared to 73 cents in the second quarter of 2024. Local currency adjusted diluted EPS (1) increased 20.8% in the second quarter. 'Sensient continued to build on a strong first quarter. Our results are a testament to our relentless focus on customer service and innovation. I remain very confident about our performance in 2025 and beyond,' said Paul Manning, Sensient's Chairman, President, and Chief Executive Officer. The Flavors & Extracts Group reported second quarter 2025 revenue of $203.3 million, a decrease of $6.0 million versus the prior year's second quarter. The Group's revenue was unfavorably impacted by lower volumes in natural ingredients, partially offset by higher volumes in our flavors, extracts, and flavor ingredients product lines. Segment operating income was $28.5 million in the second quarter of 2025, an increase of $2.3 million compared to the prior year's second quarter. The segment operating income increased despite the decline in segment revenues due to strong profitability of the flavors, extracts, and flavor ingredients product lines. The Color Group reported revenue of $179.3 million in the second quarter of 2025, an increase of $11.6 million compared to the prior year's second quarter. The Group's revenue increase was driven by strong growth in the food and pharmaceutical product lines. Segment operating income was $38.9 million in the second quarter of 2025, an increase of $7.4 million compared to the prior year's second quarter results. The Asia Pacific Group reported revenue of $42.7 million in the second quarter of 2025, an increase of $4.2 million compared to the prior year's second quarter. The Group's revenue increased across nearly all geographies. Segment operating income was $8.9 million in the quarter, an increase of $1.1 million compared to the prior year's second quarter. Corporate & Other reported operating expenses of $18.7 million in the second quarter of 2025, compared to $15.9 million of operating expenses reported in the prior year's second quarter. The higher operating expenses were primarily due to higher Portfolio Optimization Plan costs in the quarter. Local currency adjusted operating expenses (1) for Corporate & Other increased $1.1 million compared to the prior year's second quarter, primarily due to higher performance-based compensation costs recorded in 2025. 2025 OUTLOOK The Company's guidance is based on current conditions and economic and market trends in the markets in which the Company operates and is subject to various risks and uncertainties as described below. USE OF NON-GAAP FINANCIAL MEASURES The Company's non-GAAP financial measures eliminate the impact of certain items, which, depending on the measure, include: currency movements, depreciation and amortization, Portfolio Optimization Plan costs, and non-cash share-based compensation. These measures are provided to enhance the overall understanding of the Company's performance when viewed together with the GAAP results. Refer to ' Reconciliation of Non-GAAP Amounts ' at the end of this release. CONFERENCE CALL The Company will host a conference call to discuss its 2025 second quarter financial results at 8:30 a.m. CDT on Friday, July 25, 2025. To participate in the conference call, contact Chorus Call Inc. at (844) 492-3726 or (412) 317-1078, and ask to join the Sensient Technologies Corporation conference call. Alternatively, the call can be accessed by using the webcast link that is available on the Investor Information section of the Company's web site at A replay of the call will be available one hour after the end of the conference call through August 1, 2025, by calling (877) 344-7529 and using access code 2167989. An audio replay and written transcript of the call will also be posted on the Investor Information section of the Company's web site at on or after July 29, 2025. This release contains statements that may constitute 'forward-looking statements' within the meaning of Federal securities laws including in the quote from our Chairman, President, and Chief Executive Office and under '2025 Outlook' above. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, and other factors concerning the Company's operations and business environment. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements and that could adversely affect the Company's future financial performance include the following: the Company's ability to manage general business, economic, and capital market conditions, including actions taken by customers in response to such market conditions, and the impact of recessions and economic downturns; the impact of macroeconomic and geopolitical volatility, including inflation and shortages impacting the availability and cost of raw materials, energy, and other supplies, disruptions and delays in the Company's supply chain, and the conflicts between Russia and Ukraine and in the Middle East; industry, regulatory, legal, and economic factors related to the Company's domestic and international business; the effects of tariffs, trade barriers, and disputes; the availability and cost of labor, logistics, and transportation; the pace and nature of new product introductions by the Company and the Company's customers; the Company's ability to anticipate and respond to changing consumer preferences, changing technologies, and changing regulations; the Company's ability to successfully implement its growth strategies; the outcome of the Company's various productivity-improvement and cost-reduction efforts, acquisition and divestiture activities, and Portfolio Optimization Plan; growth in markets for products in which the Company competes; industry and customer acceptance of price increases; actions by competitors; the Company's ability to enhance its innovation efforts and drive cost efficiencies; currency exchange rate fluctuations; and other factors included in 'Risk Factors' in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, and in other documents that the Company files with the SEC. The risks and uncertainties identified above are not the only risks the Company faces. Additional risks and uncertainties not presently known to the Company or that it currently believes to be immaterial also may adversely affect the Company. Should any known or unknown risks and uncertainties develop into actual events, these developments could have material adverse effects on our business, financial condition, and results of operations. This release contains time-sensitive information that reflects management's best analysis only as of the date of this release. Except to the extent required by applicable laws, the Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied herein will not be realized. ABOUT SENSIENT TECHNOLOGIES Sensient Technologies Corporation is a leading global manufacturer and marketer of colors, flavors, and other specialty ingredients. Sensient uses advanced technologies and robust global supply chain capabilities to develop specialized solutions for food and beverages, as well as products that serve the pharmaceutical, nutraceutical, and personal care industries. Sensient's customers range in size from small entrepreneurial businesses to major international manufacturers representing some of the world's best-known brands. Sensient is headquartered in Milwaukee, Wisconsin. Sensient Technologies Corporation (In thousands) (Unaudited) Consolidated Condensed Balance Sheets June 30, December 31, 2025 2024 Cash and cash equivalents $ 56,686 $ 26,626 Trade accounts receivable 333,951 290,087 Inventories 619,595 600,302 Prepaid expenses and other current assets 54,221 44,871 Fixed assets held for sale 1,629 - Total Current Assets 1,066,082 961,886 Goodwill & intangible assets (net) 451,942 423,658 Property, plant, and equipment (net) 515,469 491,587 Other assets 171,068 146,663 Total Assets $ 2,204,561 $ 2,023,794 Trade accounts payable $ 121,442 $ 139,052 Short-term borrowings 26,280 19,848 Other current liabilities 103,402 111,739 Total Current Liabilities 251,124 270,639 Long-term debt 710,119 613,523 Accrued employee and retiree benefits 26,865 24,499 Other liabilities 59,332 54,147 Shareholders' Equity 1,157,121 1,060,986 Total Liabilities and Shareholders' Equity $ 2,204,561 $ 2,023,794 Expand Sensient Technologies Corporation (In thousands, except per share amounts) (Unaudited) Consolidated Statements of Cash Flows Six Months Ended June 30, 2025 2024 Cash flows from operating activities: Net earnings $ 72,049 $ 61,872 Adjustments to arrive at net cash provided by operating activities: Depreciation and amortization 30,334 29,725 Share-based compensation expense 6,639 4,911 Net loss (gain) on assets 76 (195 ) Portfolio Optimization Plan costs 1,274 1,495 Deferred income taxes 2,711 529 Changes in operating assets and liabilities: Trade accounts receivable (30,293 ) (49,449 ) Inventories (548 ) 36,730 Prepaid expenses and other assets (11,028 ) (6,612 ) Trade accounts payable and other accrued expenses (17,578 ) (22,722 ) Accrued salaries, wages, and withholdings (15,129 ) 7,824 Income taxes (937 ) (6,591 ) Other liabilities 1,734 1,429 Net cash provided by operating activities 39,304 58,946 Cash flows from investing activities: Acquisition of property, plant, and equipment (38,035 ) (22,850 ) Proceeds from sale of assets 56 296 Acquisition of new business (4,867 ) - Other investing activities 1,354 (336 ) Net cash used in investing activities (41,492 ) (22,890 ) Cash flows from financing activities: Proceeds from additional borrowings 106,484 132,189 Debt payments (43,148 ) (120,571 ) Dividends paid (34,700 ) (34,685 ) Other financing activities (2,648 ) (3,016 ) Net cash provided by (used in) financing activities 25,988 (26,083 ) Effect of exchange rate changes on cash and cash equivalents 6,260 (8,568 ) Net increase in cash and cash equivalents 30,060 1,405 Cash and cash equivalents at beginning of period 26,626 28,934 Cash and cash equivalents at end of period $ 56,686 $ 30,339 Supplemental Information Six Months Ended June 30, 2025 2024 Dividends paid per share $ 0.82 $ 0.82 Expand Sensient Technologies Corporation (In thousands, except percentages and per share amounts) (Unaudited) Reconciliation of Non-GAAP Amounts The Company's results for the three and six months ended June 30, 2025 and 2024 include adjusted operating income, adjusted net earnings, and adjusted diluted earnings per share, which, in each case, exclude Portfolio Optimization Plan costs. Three Months Ended June 30, Six Months Ended June 30, 2025 2024 % Change 2025 2024 % Change Operating income (GAAP) $ 57,706 $ 49,657 16.2 % $ 111,236 $ 99,063 12.3 % Portfolio Optimization Plan costs – Cost of products sold 1,789 207 3,603 314 Portfolio Optimization Plan costs – Selling and administrative expenses 1,550 1,545 2,600 4,250 Adjusted operating income $ 61,045 $ 51,409 18.7 % $ 117,439 $ 103,627 13.3 % Net earnings (GAAP) $ 37,587 $ 30,932 21.5 % $ 72,049 $ 61,872 16.4 % Portfolio Optimization Plan costs, before tax 3,339 1,752 6,203 4,564 Tax impact of Portfolio Optimization Plan costs (1) (815 ) (214 ) (1,517 ) (569 ) Adjusted net earnings $ 40,111 $ 32,470 23.5 % $ 76,735 $ 65,867 16.5 % Diluted earnings per share (GAAP) $ 0.88 $ 0.73 20.5 % $ 1.69 $ 1.46 15.8 % Portfolio Optimization Plan costs, net of tax 0.06 0.04 0.11 0.09 Adjusted diluted earnings per share $ 0.94 $ 0.77 22.1 % $ 1.80 $ 1.56 15.4 % Note: Earnings per share calculations may not foot due to rounding differences. (1) Tax impact adjustments were determined based on the nature of the underlying non-GAAP adjustments and their relevant jurisdictional tax rates. Results by Segment Three Months Ended June 30, Adjusted Adjusted Operating Income 2025 Adjustments (2) 2025 2024 Adjustments (2) 2024 Flavors & Extracts $ 28,506 $ - $ 28,506 $ 26,209 $ - $ 26,209 Color 38,922 - 38,922 31,502 - 31,502 Asia Pacific 8,943 - 8,943 7,880 - 7,880 Corporate & Other (18,665 ) 3,339 (15,326 ) (15,934 ) 1,752 (14,182 ) Consolidated $ 57,706 $ 3,339 $ 61,045 $ 49,657 $ 1,752 $ 51,409 Results by Segment Six Months Ended June 30, Adjusted Adjusted Operating Income 2025 Adjustments (2) 2025 2024 Adjustments (2) 2024 Flavors & Extracts $ 53,495 $ - $ 53,495 $ 49,887 $ - $ 49,887 Color 73,774 - 73,774 63,181 - 63,181 Asia Pacific 18,385 - 18,385 16,656 - 16,656 Corporate & Other (34,418 ) 6,203 (28,215 ) (30,661 ) 4,564 (26,097 ) Consolidated $ 111,236 $ 6,203 $ 117,439 $ 99,063 $ 4,564 $ 103,627 (2) Adjustments consist of Portfolio Optimization Plan costs. Expand Sensient Technologies Corporation (Unaudited) Reconciliation of Non-GAAP Amounts - Continued The following table summarizes the percentage change in the 2025 results compared to the 2024 results for the corresponding periods. Three Months Ended June 30, 2025 Revenue Total Foreign Exchange Rates Adjustments (3) Local Currency Adjusted Flavors & Extracts (2.8 %) 0.4 % N/A (3.2 %) Color 6.9 % 0.3 % N/A 6.6 % Asia Pacific 10.8 % 3.2 % N/A 7.6 % Total Revenue 2.7 % 0.6 % N/A 2.1 % Operating Income Flavors & Extracts 8.8 % 0.2 % 0.0 % 8.6 % Color 23.6 % 1.5 % 0.0 % 22.1 % Asia Pacific 13.5 % 5.5 % 0.0 % 8.0 % Corporate & Other 17.1 % 0.0 % 9.0 % 8.1 % Total Operating Income 16.2 % 1.9 % (2.6 %) 16.9 % Diluted Earnings Per Share 20.5 % 1.3 % (1.6 %) 20.8 % Adjusted EBITDA 15.4 % 1.3 % N/A 14.1 % Six Months Ended June 30, 2025 Revenue Total Foreign Exchange Rates Adjustments (3) Local Currency Adjusted Flavors & Extracts (1.3 %) (0.4 %) N/A (0.9 %) Color 5.9 % (1.5 %) N/A 7.4 % Asia Pacific 7.3 % 1.1 % N/A 6.2 % Total Revenue 2.3 % (0.8 %) N/A 3.1 % Operating Income Flavors & Extracts 7.2 % (0.3 %) 0.0 % 7.5 % Color 16.8 % (1.0 %) 0.0 % 17.8 % Asia Pacific 10.4 % 2.9 % 0.0 % 7.5 % Corporate & Other 12.3 % 0.0 % 4.2 % 8.1 % Total Operating Income 12.3 % (0.3 %) (1.0 %) 13.6 % Diluted Earnings Per Share 15.8 % 0.0 % (0.2 %) 16.0 % Adjusted EBITDA 11.7 % (0.4 %) N/A 12.1 % (3) Adjustments consist of Portfolio Optimization Plan costs. Expand Sensient Technologies Corporation (In thousands, except percentages) (Unaudited) Reconciliation of Non-GAAP Amounts - Continued The following table summarizes the reconciliation between Operating Income (GAAP) and Adjusted EBITDA for the three and six months ended June 30, 2025 and 2024. Three Months Ended June 30, Six Months Ended June 30, 2025 2024 % Change 2025 2024 % Change Operating income (GAAP) $ 57,706 $ 49,657 16.2 % $ 111,236 $ 99,063 12.3 % Depreciation and amortization 15,260 15,016 30,334 29,725 Share-based compensation expense 3,739 2,916 6,639 4,911 Portfolio Optimization Plan costs, before tax 3,339 1,752 6,203 4,564 Adjusted EBITDA $ 80,044 $ 69,341 15.4 % $ 154,412 $ 138,263 11.7 % The following table summarizes the reconciliation between Debt (GAAP) and Net Debt, and Operating Income (GAAP) and Credit Adjusted EBITDA for the trailing twelve months ended June 30, 2025 and 2024. June 30, Debt 2025 2024 Short-term borrowings $ 26,280 $ 26,995 Long-term debt 710,119 634,663 Credit Agreement adjustments (4) (43,393 ) (18,034 ) Net Debt $ 693,006 $ 643,624 Operating income (GAAP) $ 203,752 $ 151,657 Depreciation and amortization 60,938 58,955 Share-based compensation expense 11,812 9,078 Portfolio Optimization Plan costs, before tax 8,270 32,405 Other non-operating gains (5) (816 ) (872 ) Credit Adjusted EBITDA $ 283,956 $ 251,223 Net Debt to Credit Adjusted EBITDA 2.4x 2.6x (4) Adjustments include cash and cash equivalents, as described in the Company's Fourth Amended and Restated Credit Agreement (Credit Agreement), and certain letters of credit and hedge contracts. (5) Adjustments consist of certain financing transaction costs, certain non-financing interest items, and gains and losses related to certain non-cash, non-operating, and/or non-recurring items as described in the Credit Agreement. We have included each of these non-GAAP measures in order to provide additional information regarding our underlying operating results and comparable period-over-period 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 release and 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 we believe 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. Expand Category: Earnings Source: Sensient Technologies Corporation
Globe and Mail
7 days ago
- Business
- Globe and Mail
Sensient Declares Dividend
The Board of Directors of Sensient Technologies Corporation (NYSE: SXT) has declared a regular quarterly cash dividend on its common stock of $0.41 per share. The cash dividend will be paid on September 2, 2025, to shareholders of record on August 4, 2025. About Sensient Technologies Sensient Technologies Corporation is a leading global manufacturer and marketer of colors, flavors, and other specialty ingredients. Sensient uses advanced technologies and robust global supply chain capabilities to develop specialized solutions for food and beverages, as well as products that serve the pharmaceutical, nutraceutical, and personal care industries. Sensient's customers range in size from small entrepreneurial businesses to major international manufacturers representing some of the world's best-known brands. Sensient is headquartered in Milwaukee, Wisconsin.
Daily Mail
30-04-2025
- Science
- Daily Mail
Fascinating look inside US mega factory making artificial food dyes as it races to ditch chemicals
In a sprawling Milwaukee lab facility, lab workers are mixing beet root and carrot juice to obtain the right shades of blues and oranges to replace the technicolor artificial dyes in Americans' favorite snack foods. People in head-to-toe suiting at Sensient Technologies Corp., one of the world's largest dye-makers, create powdered and liquid dyes out of natural ingredients and store them in a giant warehouse to be shipped out to businesses they contract with. Dave Gebhardt, Sensient's senior technical director, said: 'Most of our customers [including companies that make candies, sodas, and frozen treats] have decided that this is finally the time when they're going to make that switch to a natural color.' However, Sensient also fears that it, along with the broader food dye manufacturing industry, will struggle to meet the demand for natural dyes that HHS Secretary Robert F. Kennedy Jr. and the wider Trump Administration are compelling food companies to use exclusively by 2026. It takes up to two years to grow the plants used to make natural colors, including black carrot extract, beet juice, and red cabbage. Synthetic dyes like the controversial Red 40, meanwhile, are relatively easy to make in large quantities. According to Sensient, there is no guarantee that a robust enough supply of carrots, cabbage, beets, and algae will be available to produce the bright hues of red, orange, blue, and green that Americans have become accustomed to eating. James Herrmann, marketing director of food colors at Sensient Technologies, said: 'If everybody switches at once, there is simply not enough material around the world available to meet the demand.' Major manufacturers, such as Sensient, will also need to alter their processing practices to scale up the development of natural products, a costly undertaking that may take longer than the timeline ordered by RFK Jr. Abby Tampow, a researcher in the lab, is working over petri dishes of red dyes spanning different ruby hues, trying to match the synthetic shade used for years in raspberry vinaigrette dressing. 'With this red, it needs a little more orange,' she told the Associated Press, mixing in purplish black carrot juice and an orange-red tint made from algae. Sensient is investing in the cultivation of new plant-based ingredients for dyes and broadening its sourcing network for crops from around the world, to maintain a stable supply regardless of climate issues or geopolitical disruptions. However, adhering to the Trump Administration's new initiative will necessitate a significant scale-up in growing and producing the natural sources of the dyes, which Sensient leadership does not believe is currently feasible. Paul Manning, the company's chief executive, said: 'It's not like there's 150 million pounds of beet juice sitting around waiting on the off chance the whole market may convert. 'Tens of millions of pounds of these products need to be grown, pulled out of the ground, extracted.' Furthermore, small bugs called cochineal, which can create the bright Barbie pink used in candies, come from only a few sources, such as prickly pear cacti in Peru. Approximately 70,000 insects are required to produce just 2.2 pounds of dye. Sensient sources raw materials from global farmers and producers. The ingredients typically arrive in bulk concentrates, which Sensient workers refine into liquids, granules, or powders. Then, they are supplied to food manufacturers to be used in finished products. Natural dyes are significantly more challenging to produce, store, and transport than their synthetic counterparts. It can take around 10 times as much material to make natural colors to mimic just a small amount of artificial dye, which will likely drive up costs for producers. Light and heat can cause colors to fade or change, or even separate. They are also likely to become chemically unstable with slight changes in acidity. There are also specific colors, namely blue, that are particularly difficult to maintain during processing. Manning said: 'How do you get that same vividness, that same performance, that same level of safety in that product as you would in a synthetic product? 'There's a lot of complexity associated with that.' RFK Jr., flanked by FDA Commissioner Marty Makary, announced last week that the agency will phase out the use of eight petroleum-based artificial food dyes – Red No. 3, Red No. 40, Yellow No. 5, Yellow No. 6, Blue No. 1, Blue No. 2, Citrus Red No. 2, and Orange B. The new timeline follows a recent meeting in which he urged food industry executives to eliminate artificial dyes from products before the end of his term in 2028. The FDA has not reached a formal agreement with the food industry to implement these goals, although it appears to have an understanding, and the agency has not presented a detailed plan for achieving them. RFK Jr suggested more additives could be next, telling the crowd: 'We're going to get rid of the dyes and we're going to get rid of every ingredient and additive in food that we can legally address. 'And for those ingredients we can't ban legally, we're going to start informing Americans about what they're eating.' Red 40 is among a group of dyes that contain benzidine, a known carcinogen for both humans and animals. While regulators permit trace amounts deemed 'safe,' concerns remain. In 1985, the FDA estimated that exposure to free benzidine from these dyes could increase cancer risk to nearly 1 in 1 million people, just below the official threshold for concern. Sensient's CEO Paul Manning emphasized the challenges of scaling natural dye production, noting that the industry can't rely on existing surplus crops like beet juice. Transitioning the market would require cultivating and processing tens of millions of pounds of raw materials Studies have also linked Red 40 and similar dyes to hyperactivity in children, including those without ADHD. Research suggests that these additives may exacerbate symptoms or induce behavioral changes. Additionally, Canadian scientists have found that Red 40 (also known as Allura Red) can disrupt gut function, impairing nutrient absorption and increasing the risk of inflammatory bowel diseases (IBD), such as Crohn's disease and ulcerative colitis. They warn that prolonged exposure may weaken the body's defenses. Blue 1, another common dye found in candies like gummy bears, has also been tied to hyperactivity and attention issues in kids. Unlike the U.S., where the FDA often reacts to safety concerns after products hit the market, European regulators ban or require warning labels on many of these dyes, taking a more preventive approach to food safety.
Chicago Tribune
29-04-2025
- Health
- Chicago Tribune
How bugs and beet juice could play roles in the race to replace artificial dyes in food
As pressure grows to get artificial colors out of the U.S. food supply, the shift may well start at Abby Tampow's laboratory desk. On an April afternoon, the scientist hovered over tiny dishes of red dye, each a slightly different ruby hue. Her task? To match the synthetic shade used for years in a commercial bottled raspberry vinaigrette — but by using only natural ingredients. 'With this red, it needs a little more orange,' Tampow said, mixing a slurry of purplish black carrot juice with a bit of beta-carotene, an orange-red color made from algae. Tampow is part of the team at Sensient Technologies Corp., one of the world's largest dyemakers, that is rushing to help the salad dressing manufacturer — along with thousands of other American businesses — meet demands to overhaul colors used to brighten products from cereals to sports drinks. 'Most of our customers have decided that this is finally the time when they're going to make that switch to a natural color,' said Dave Gebhardt, Sensient's senior technical director. He joined a recent tour of the Sensient Colors factory in a north St. Louis neighborhood. Last week, U.S. health officials announced plans to persuade food companies to voluntarily eliminate petroleum-based artificial dyes by the end of 2026. Health Secretary Robert F. Kennedy Jr. called them 'poisonous compounds' that endanger children's health and development, citing limited evidence of potential health risks. The federal push follows a flurry of state laws and a January decision to ban the artificial dye known as Red 3 — found in cakes, candies and some medications — because of cancer risks in lab animals. Social media influencers and ordinary consumers have ramped up calls for artificial colors to be removed from foods. A change to natural colors may not be fast The Food and Drug Administration allows about three dozen color additives, including eight remaining synthetic dyes. But making the change from the petroleum-based dyes to colors derived from vegetables, fruits, flowers and even insects won't be easy, fast or cheap, said Monica Giusti, an Ohio State University food color expert. 'Study after study has shown that if all companies were to remove synthetic colors from their formulations, the supply of the natural alternatives would not be enough,' Giusti said. 'We are not really ready.' It can take six months to a year to convert a single product from a synthetic dye to a natural one. And it could require three to four years to build up the supply of botanical products necessary for an industrywide shift, Sensient officials said. 'It's not like there's 150 million pounds of beet juice sitting around waiting on the off chance the whole market may convert,' said Paul Manning, the company's chief executive. 'Tens of millions of pounds of these products need to be grown, pulled out of the ground, extracted.' To make natural dyes, Sensient works with farmers and producers around the world to harvest the raw materials, which typically arrive at the plant as bulk concentrates. They're processed and blended into liquids, granules or powders and then sent to food companies to be added to final products. Natural dyes are harder to make and use than artificial colors. They are less consistent in color, less stable and subject to changes related to acidity, heat and light, Manning said. Blue is especially difficult. There aren't many natural sources of the color and those that exist can be hard to maintain during processing. Also, a natural color costs about 10 times more to make than the synthetic version, Manning estimated. 'How do you get that same vividness, that same performance, that same level of safety in that product as you would in a synthetic product?' he said. 'There's a lot of complexity associated with that.' The insects that could make 'Barbie pink' naturally Companies have long used the Red 3 synthetic dye to create what Sensient officials describe as 'the Barbie pink.' To create that color with a natural source might require the use of cochineal, an insect about the size of a peppercorn. The female insects release a vibrant red pigment, carminic acid, in their bodies and eggs. The bugs live only on prickly pear cactuses in Peru and elsewhere. About 70,000 cochineal insects are needed to produce 1 kilogram, about 2.2 pounds, of dye. 'It's interesting how the most exotic colors are found in the most exotic places,' said Norb Nobrega, who travels the world scouting new hues for Sensient. Artificial dyes are used widely in U.S. foods. About 1 in 5 food products in the U.S. contains added colors, whether natural or synthetic, Manning estimated. Many contain multiple colors. FDA requires a sample of each batch of synthetic colors to be submitted for testing and certification. Color additives derived from plant, animal or mineral sources are exempt, but have been evaluated by the agency. Health advocates have long called for the removal of artificial dyes from foods, citing mixed studies indicating they can cause neurobehavioral problems, including hyperactivity and attention issues, in some children. The FDA says that the approved dyes are safe when used according to regulations and that 'most children have no adverse effects when consuming foods containing color additives.' But critics note that added colors are a key component of ultraprocessed foods, which account for more than 70% of the U.S. diet and have been associated with a host of chronic health problems, including heart disease, diabetes and obesity. 'I am all for getting artificial food dyes out of the food supply,' said Marion Nestle, a food policy expert. 'They are strictly cosmetic, have no health or safety purpose, are markers of ultraprocessed foods and may be harmful to some children.' The cautionary tale of Trix cereal Color is powerful driver of consumer behavior and changes can backfire, Giusti noted. In 2016, food giant General Mills removed artificial dyes from Trix cereal after requests from consumers, switching to natural sources including turmeric, strawberries and radishes. But the cereal lost its neon colors, resulting in more muted hues — and a consumer backlash. Trix fans said they missed the bright colors and familiar taste of the cereal. In 2017, the company switched back. 'When it's a product you already love, that you're used to consuming, and it changes slightly, then it may not really be the same experience,' Giusti said. 'Announcing a regulatory change is one step, but then the implementation is another thing.' Kennedy, the health secretary, said U.S. officials have an 'understanding' with food companies to phase out artificial colors. Industry officials told The Associated Press that there is no formal agreement. However, several companies have said they plan to accelerate a shift to natural colors in some of their products. PepsiCo CEO Ramon Laguarta said most of its products are already free of artificial colors, and that its Lays and Tostitos brands will phase them out by the end of this year. He said the company plans to phase out artificial colors — or at least offer consumers a natural alternative — over the next few years. Representatives for General Mills said they're 'committed to continuing the conversation' with the administration. WK Kellogg officials said they are reformulating cereals used in the nation's school lunch programs to eliminate the artificial dyes and will halt any new products containing them starting next January. Sensient officials wouldn't confirm which companies are seeking help making the switch, but they said they're ready for the surge. 'Now that there's a date, there's the timeline,' Manning said. 'It certainly requires action.'
