INGREDION INCORPORATED REPORTS SOLID THIRD QUARTER 2014 RESULTS
(Thomson Reuters ONE) -
* Third quarter 2014 EPS rose 45 percent to $1.60 from $1.10 in the third
quarter 2013
* Year-to-date EPS was $3.89, up 5 percent from $3.71 in the year-ago period
* Operating income grew double-digits across all regions in the third quarter
* Annual EPS guidance narrowed and lowered to $5.35 to $5.50
WESTCHESTER, Ill., October 30, 2014 - Ingredion Incorporated (NYSE: INGR), a
leading global provider of ingredient solutions to diversified industries, today
reported results for the third quarter 2014.
"We delivered a strong third quarter that reflects continued momentum in our
business," said Ilene Gordon, chairman, president and chief executive officer.
"All four regions delivered double-digit operating income growth, largely driven
by solid volume growth, and expanded dollar margins through effective pricing
and cost management.
"In addition, we have been actively executing against our strategic blueprint,
as evidenced by our recently announced acquisition of Penford Corporation, for
approximately $340 million, to enhance our specialty ingredient portfolio. We
also announced our intention to invest approximately $100 million in capital to
drive further organic growth by expanding our manufacturing capacity for
specialty ingredients. A critical part of our strategy is effective deployment
of cash. In addition to the pending Penford acquisition, our current
accelerated share repurchase program, for approximately $300 million, will
contribute to diluted earnings per share accretion going forward.
"Overall, we expect our current business momentum to carry into the fourth
quarter. We have been progressively overcoming a slow start in 2014. While we
do not believe we will make up for all the challenges we faced earlier this
year, our performance trajectory and recent strategic actions position us well
for the future."
Estimated factors affecting change in diluted earnings per share (EPS)
+----------------------------+--------+--------+
| | 3Q | YTD |
+----------------------------+--------+--------+
| Prior Year EPS: | $1.10 | $3.71 |
+----------------------------+--------+--------+
| Margin | 0.30 | (0.03) |
+----------------------------+--------+--------+
| Volume | 0.06 | 0.21 |
+----------------------------+--------+--------+
| Foreign exchange | (0.02) | (0.16) |
+----------------------------+--------+--------+
| Other income | 0.06 | 0.08 |
+----------------------------+--------+--------+
| Total operating items | 0.40 | 0.10 |
+----------------------------+--------+--------+
| | | |
+----------------------------+--------+--------+
| Financing costs | 0.03 | 0.02 |
+----------------------------+--------+--------+
| Shares outstanding | 0.07 | 0.16 |
+----------------------------+--------+--------+
| Tax rate | - | (0.08) |
+----------------------------+--------+--------+
| Non-controlling interest | - | (0.02) |
+----------------------------+--------+--------+
| Total non-operating items | 0.10 | 0.08 |
+----------------------------+--------+--------+
| Total items affecting EPS | 0.50 | 0.18 |
+----------------------------+--------+--------+
| Current Year EPS: | $1.60 | $3.89 |
+----------------------------+--------+--------+
Financial Highlights
* At September 30, 2014, total debt and cash and cash equivalents were $1.9
billion and $565 million, respectively, versus $1.8 billion and $574
million, respectively, at December 31, 2013.
* During the third quarter of 2014, net financing costs were $15 million,
compared to $18 million in the year-ago period.
* The third quarter effective tax rate was 26.1 percent compared to 25.8
percent in the year-ago period.
* The year-to-date cash provided by operations was $462 million compared to
$362 million in the year-ago period.
* For the first nine months, capital expenditures, net of disposals, were $187
million compared to $202 million last year.
Business Review
Total Ingredion
+-------------+--------------+---------+------+---------+-------------+--------+
|$ in millions|2013 Net sales|FX Impact|Volume|Price/mix| 2014 Net |% change|
| | | | | | sales | |
+-------------+--------------+---------+------+---------+-------------+--------+
|Third quarter| 1,612 | -34 | 35 | -153 | 1,460 | -9% |
+-------------+--------------+---------+------+---------+-------------+--------+
|Year-to-date | 4,829 | -179 | 98 | -448 | 4,300 | -11% |
+-------------+--------------+---------+------+---------+-------------+--------+
Operating income
* Third quarter 2014 operating income increased 30 percent to $178 million
compared to $137 million in the third quarter of 2013. Operating income
grew in every region for the quarter.
* Year-to-date 2014 operating income increased 2 percent from $452 million in
2013 to $463 million this year. Strong performance in APAC and EMEA was
offset by a challenging operating environment in South America and a weaker-
than-expected first quarter in North America. In addition, corporate
expenses included $7 million of income relating to a tax indemnification
payment, which was completely offset by higher income tax expense.
North America
+-------------+--------------+---------+------+---------+-------------+--------+
|$ in millions|2013 Net sales|FX Impact|Volume|Price/mix| 2014 Net |% change|
| | | | | | sales | |
+-------------+--------------+---------+------+---------+-------------+--------+
|Third quarter| 949 | -6 | 28 | -165 | 806 | -15% |
+-------------+--------------+---------+------+---------+-------------+--------+
|Year-to-date | 2,835 | -24 | 37 | -486 | 2,362 | -17% |
+-------------+--------------+---------+------+---------+-------------+--------+
Operating income
* Third quarter 2014 operating income increased 17 percent to $113 million
compared to $97 million in the third quarter of 2013. The increase was
driven by volume growth in the US and Canada, and strong operating results
in Mexico.
* Year-to-date 2014 operating income fell 6 percent from $308 million in 2013
to $289 million this year. The decline reflects the impact of a weak first
quarter which more than offset growth in the second and third quarters.
South America
+-------------+--------------+---------+------+---------+-------------+--------+
|$ in millions|2013 Net sales|FX Impact|Volume|Price/mix| 2014 Net |% change|
| | | | | | sales | |
+-------------+--------------+---------+------+---------+-------------+--------+
|Third quarter| 323 | -34 | -5 | 24 | 308 | -5% |
+-------------+--------------+---------+------+---------+-------------+--------+
|Year-to-date | 992 | -153 | 16 | 51 | 906 | -9% |
+-------------+--------------+---------+------+---------+-------------+--------+
Operating income
* Third quarter 2014 operating income grew 46 percent to $27 million compared
to $19 million in the third quarter of 2013 as the business adjusted to a
challenging environment.
* Year-to-date 2014 operating income fell 7 percent from $80 million in 2013
to $74 million this year as a weak first half in Argentina, driven by
rapidly escalating input costs and a severe currency devaluation, more than
offset improved results for the South American region in the third quarter.
Asia Pacific
+-------------+--------------+---------+------+---------+-------------+--------+
|$ in millions|2013 Net sales|FX Impact|Volume|Price/mix| 2014 Net |% change|
| | | | | | sales | |
+-------------+--------------+---------+------+---------+-------------+--------+
|Third quarter| 205 | 3 | 9 | -11 | 206 | -% |
+-------------+--------------+---------+------+---------+-------------+--------+
|Year-to-date | 601 | -9 | 31 | -29 | 594 | -1% |
+-------------+--------------+---------+------+---------+-------------+--------+
Operating income
* Third quarter 2014 operating income increased 14 percent to $27 million
compared to $24 million in the third quarter of 2013, driven by volume
growth and cost management.
* Year-to-date 2014 operating income also rose 14 percent from $70 million in
2013 to $80 million this year behind solid operating results throughout the
region.
Europe, Middle East, Africa (EMEA)
+-------------+--------------+---------+------+---------+-------------+--------+
|$ in millions|2013 Net sales|FX Impact|Volume|Price/mix| 2014 Net |% change|
| | | | | | sales | |
+-------------+--------------+---------+------+---------+-------------+--------+
|Third quarter| 135 | 3 | 4 | -1 | 141 | +4% |
+-------------+--------------+---------+------+---------+-------------+--------+
|Year-to-date | 401 | 6 | 15 | 16 | 438 | +9% |
+-------------+--------------+---------+------+---------+-------------+--------+
Operating income
* Third quarter 2014 operating income increased 28 percent to $22 million
compared to $17 million in the third quarter of 2013. Results were
particularly strong in Europe as the volume growth and cost benefits of our
recent capacity investments continued to generate good returns.
* Year-to-date 2014 operating income rose 28 percent from $54 million in 2013
to $69 million this year largely as a result of continued momentum in Europe
and solid results in Pakistan.
2014 Guidance
2014 EPS is expected to be in a range of $5.35 to $5.50 compared to $5.05 in
2013. The guidance anticipates North America operating income will be down for
the full year. Our momentum has been good in the second and third quarters in
North America, but we do not expect to compensate for the slow start to the
year. In line with previous guidance, we expect continued cost pressures in
Argentina and softness in the Brazilian economy to result in South America being
down slightly for the year. Also in line with previous guidance, operating
income in Asia Pacific and EMEA is expected to be up. The guidance also
reflects slightly lower anticipated financing costs compared to last year and an
estimated effective tax rate of 27 - 28 percent.
Cash generated by operations is expected to be $700 - $750 million in 2014.
Capital expenditures in 2014 are now anticipated to be slightly below $300
million. These investments will support growth and cost reduction actions
across the organization.
Conference Call and Webcast
Ingredion will conduct a conference call today at 9:00 a.m. Eastern Time (8:00
a.m. Central Time) to be hosted by Ilene Gordon, chairman, president and chief
executive officer, and Jack Fortnum, chief financial officer.
The call will be broadcast in a real-time webcast. The broadcast will consist of
the call and a visual presentation accessible through the Ingredion web site at
www.ingredion.com. The presentation will be available to download approximately
60 minutes prior to the start of the call. A replay of the webcast will be
available at www.ingredion.com.
ABOUT THE COMPANY
Ingredion Incorporated (NYSE:INGR) is a leading global ingredients solutions
provider specializing in nature-based sweeteners, starches and nutrition
ingredients. With customers in more than 100 countries, Ingredion serves
approximately 60 diverse sectors in food, beverage, brewing, pharmaceuticals and
other industries. For more information, visit www.ingredion.com.
Forward-Looking Statements
This news release contains or may contain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. The Company intends
these forward-looking statements to be covered by the safe harbor provisions for
such statements.
Forward-looking statements include, among other things, any statements regarding
the Company's prospects or future financial condition, earnings, revenues, tax
rates, capital expenditures, expenses or other financial items, any statements
concerning the Company's prospects or future operations, including management's
plans or strategies and objectives therefor and any assumptions, expectations or
beliefs underlying the foregoing.
These statements can sometimes be identified by the use of forward looking words
such as "may," "will," "should," "anticipate," "believe," "plan," "project,"
"estimate," "expect," "intend," "continue," "pro forma," "forecast," "outlook"
or other similar expressions or the negative thereof. All statements other than
statements of historical facts in this release or referred to in this release
are "forward-looking statements."
These statements are based on current expectations, but are subject to certain
inherent risks and uncertainties, many of which are difficult to predict and are
beyond our control. Although we believe our expectations reflected in these
forward-looking statements are based on reasonable assumptions, stockholders are
cautioned that no assurance can be given that our expectations will prove
correct.
Actual results and developments may differ materially from the expectations
expressed in or implied by these statements, based on various factors, including
the effects of global economic conditions, including, particularly, continuation
or worsening of the current economic, currency and political conditions in South
America and economic conditions in Europe, and their impact on our sales volumes
and pricing of our products, our ability to collect our receivables from
customers and our ability to raise funds at reasonable rates; fluctuations in
worldwide markets for corn and other commodities, and the associated risks of
hedging against such fluctuations; fluctuations in the markets and prices for
our co-products, particularly corn oil; fluctuations in aggregate industry
supply and market demand; the behavior of financial markets, including foreign
currency fluctuations and fluctuations in interest and exchange rates; continued
volatility and turmoil in the capital markets; the commercial and consumer
credit environment; general political, economic, business, market and weather
conditions in the various geographic regions and countries in which we buy our
raw materials or manufacture or sell our products; future financial performance
of major industries which we serve, including, without limitation, the food and
beverage, pharmaceuticals, paper, corrugated, textile and brewing industries;
energy costs and availability, freight and shipping costs, and changes in
regulatory controls regarding quotas, tariffs, duties, taxes and income tax
rates; operating difficulties; availability of raw materials, including tapioca
and the specific varieties of corn upon which our products are based; energy
issues in Pakistan; boiler reliability; our ability to effectively integrate and
operate acquired businesses; our ability to achieve budgets and to realize
expected synergies; our ability to complete planned maintenance and investment
projects successfully and on budget; labor disputes; genetic and biotechnology
issues; changing consumption preferences including those relating to high
fructose corn syrup; increased competitive and/or customer pressure in the corn-
refining industry; and the outbreak or continuation of serious communicable
disease or hostilities including acts of terrorism. Factors relating to the
pending acquisition of Penford Corporation that could cause actual results and
developments to differ from expectations include: required regulatory approvals
may not be obtained in a timely manner, if at all; the pending acquisition may
not be consummated in a timely manner or at all; the anticipated benefits of the
pending acquisition, including synergies, may not be realized; and the
integration of Penford's operations with those of Ingredion may be materially
delayed or may be more costly or difficult than expected.
Our forward-looking statements speak only as of the date on which they are made
and we do not undertake any obligation to update any forward-looking statement
to reflect events or circumstances after the date of the statement as a result
of new information or future events or developments. If we do update or correct
one or more of these statements, investors and others should not conclude that
we will make additional updates or corrections. For a further description of
these and other risks, see "Risk Factors" included in our Annual Report on Form
10-K for the year ended December 31, 2013 and subsequent reports on Forms 10-Q
and 8-K.
CONTACT:
Investors: Steve Latreille, 708-551-2592
Media: Claire Regan, 708-551-2602
3Q 2014 PR Tables:
http://hugin.info/147221/R/1866978/655939.pdf
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GlobeNewswire clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Ingredion Incorporated via GlobeNewswire
[HUG#1866978]
Unternehmensinformation / Kurzprofil:
Datum: 30.10.2014 - 11:30 Uhr
Sprache: Deutsch
News-ID 348233
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contact information:
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