INGREDION INCORPORATED REPORTS STRONG SECOND QUARTER 2016 RESULTS
(Thomson Reuters ONE) -
* Second quarter 2016 reported and adjusted EPS were $1.58 and $1.73,
respectively, compared to second quarter 2015 reported and adjusted EPS of
$1.47 and $1.53, respectively
* Year-to-date 2016 reported and adjusted EPS were $3.36 and $3.51,
respectively, up from $2.62 of reported EPS and $2.83 adjusted EPS in the
year-ago period
* Reported operating income of $198 million and record adjusted operating
income of $211 million
* Company raises 2016 adjusted EPS guidance range to $6.70-$6.90
WESTCHESTER, Ill., July 28, 2016 - Ingredion Incorporated (NYSE: INGR), a
leading global provider of ingredient solutions to diversified industries, today
reported results for the second quarter 2016. GAAP results for 2016 and 2015
include items which are excluded from non-GAAP results. Adjusted earnings per
share, adjusted operating income, and adjusted effective tax rates are non-GAAP
financial measures. Please refer to the reconciliation of GAAP measures to non-
GAAP measures in Note III at the end of this release for more information.
"We delivered another strong quarter with solid operating income and earnings
per share. More favorable price/product mix across the portfolio, as well as
margin expansion propelled by our global optimization efforts all contributed
to increases in profitability," said Ilene Gordon, chairman, president and chief
executive officer. "North America, Asia Pacific and EMEA achieved record
operating income for the quarter while operating income was lower in South
America as that region faced macroeconomic and foreign-exchange headwinds.
"As we continue to execute our strategic blueprint, we expect a strong year and
are raising our anticipated 2016 adjusted EPS, now to a range from $6.70 to
$6.90," Gordon added.
Diluted Earnings Per Share (EPS)
+---------------------------------+-------+-------+-------+-------+
| | 2Q15 | 2Q16 | YTD15 | YTD16 |
+---------------------------------+-------+-------+-------+-------+
| Reported EPS | $1.47 | $1.58 | $2.62 | $3.36 |
+---------------------------------+-------+-------+-------+-------+
| Acquisition/Integration Costs | $0.07 | - | $0.13 | $0.01 |
+---------------------------------+-------+-------+-------+-------+
| Impairment/Restructuring Costs | - | $0.14 | $0.09 | $0.14 |
+---------------------------------+-------+-------+-------+-------+
| Adjusted EPS* | $1.53 | $1.73 | $2.83 | $3.51 |
+---------------------------------+-------+-------+-------+-------+
*Totals may not foot due to rounding
Estimated factors affecting change in EPS
+----------------------------+--------+--------+
| | 2Q16 | YTD16 |
+----------------------------+--------+--------+
| Margin | 0.36 | 0.90 |
+----------------------------+--------+--------+
| Volume | (0.06) | (0.03) |
+----------------------------+--------+--------+
| Foreign exchange | (0.02) | (0.16) |
+----------------------------+--------+--------+
| Other income/(expense) | 0.02 | - |
+----------------------------+--------+--------+
| Total operating items | 0.30 | 0.71 |
+----------------------------+--------+--------+
| | | |
+----------------------------+--------+--------+
| Financing costs | (0.02) | (0.02) |
+----------------------------+--------+--------+
| Shares outstanding | (0.03) | (0.05) |
+----------------------------+--------+--------+
| Tax rate | (0.04) | 0.06 |
+----------------------------+--------+--------+
| Non-controlling interest | (0.01) | (0.02) |
+----------------------------+--------+--------+
| Total non-operating items | (0.10) | (0.03) |
+----------------------------+--------+--------+
| Total items affecting EPS | 0.20 | 0.68 |
+----------------------------+--------+--------+
Financial Highlights
* At June 30, 2016, total debt and cash and short-term investments were $1.83
billion and $507 million, respectively, versus $1.84 billion and $440
million, respectively, at December 31, 2015. Cash and short-term investments
were higher primarily driven by higher net income.
* During the second quarter of 2016, net financing costs were $19 million, or
$2 million higher than the year-ago period, largely due to foreign exchange
losses.
* For the second quarter of 2016, reported and adjusted effective tax rates
were 32.8 percent and 32.0 percent, respectively, compared to reported and
adjusted effective tax rates of 30.3 percent and 30.5 percent, respectively,
in the year-ago period. The higher rates were primarily driven by greater
earnings in higher-tax jurisdictions as well as the devaluation of the
Mexican peso during the quarter partially offset by the adoption of a new
accounting standard for share-based compensation.
* Capital expenditures were $125 million for the first half of 2016,
approximately in line with the year-ago period.
Business Review
Total Ingredion
+--------------+-------------+---------+------+---------+-------------+--------+
|$ in millions | 2015 Net |FX Impact|Volume|Price/mix| 2016 Net |% change|
| | sales | | | | sales | |
+--------------+-------------+---------+------+---------+-------------+--------+
|Second quarter| 1,449 | -69 | -9 | 84 | 1,455 | 0% |
+--------------+-------------+---------+------+---------+-------------+--------+
|Year-to-date | 2,779 | -183 | 46 | 173 | 2,815 | 1% |
+--------------+-------------+---------+------+---------+-------------+--------+
Net Sales
* Second quarter net sales were up slightly as a result of improved price/mix
in North America and South America and a more favorable product mix in both
specialty and core ingredients. These factors were offset predominantly by
changes in foreign currency exchange rates and organic volume declines
attributable to the sale of our Port Colborne, Canada, facility and
macroeconomic headwinds in South America.
* Year-to-date net sales were up as a result of improved price/mix in North
America and South America, a more favorable product mix in both specialty
and core ingredients, as well as acquisition-related growth. These factors
were mostly offset by changes in foreign currency exchange rates and organic
volume declines attributable to the sale of our Port Colborne, Canada,
facility and macroeconomic headwinds in South America.
Operating income
* Second quarter reported and adjusted operating income were $198 million and
$211 million, respectively. These were 15 percent and 17 percent increases,
respectively, compared to $173 million of reported operating income and $180
million of adjusted operating income in the second quarter of 2015. The
increases in operating income were primarily due to better price/product mix
in both our specialty and core ingredients and reduced costs resulting from
our global optimization efforts. These positives were partially offset by
the negative effect of foreign exchange and macroeconomic headwinds in South
America.
* Year-to-date 2016 reported and adjusted operating income were $398 million
and $412 million, respectively. These were 28 percent and 22 percent
increases, respectively, compared to $312 million of year-to-date 2015
reported operating income and $337 million of year-to-date 2015 adjusted
operating income. The increases in operating income were primarily due to a
better price/product mix in both our specialty and core ingredients,
acquisition-related growth, and reduced costs resulting from our global
optimization efforts. These positives were partially offset by the negative
effect of foreign exchange and macroeconomic headwinds in South America.
* Second quarter reported operating income was lower than adjusted operating
income by $13 million. Of this difference, $8 million is related to
employee-related severance and other costs associated with the execution of
global IT outsourcing contracts; $3 million of employee-related severance
costs associated with South American restructuring; and $2 million in
charges related to the finalization of the transaction related to the prior
year net gain on the sale of our plant in Port Colborne, Canada.
North America
+--------------+-------------+---------+------+---------+-------------+--------+
|$ in millions | 2015 Net |FX Impact|Volume|Price/mix| 2016 Net |% change|
| | sales | | | | sales | |
+--------------+-------------+---------+------+---------+-------------+--------+
|Second quarter| 869 | -5 | -4 | 34 | 895 | 3% |
+--------------+-------------+---------+------+---------+-------------+--------+
|Year-to-date | 1,623 | -14 | 52 | 74 | 1,735 | 7% |
+--------------+-------------+---------+------+---------+-------------+--------+
Operating income
* Second quarter operating income increased from $127 million to $160 million.
Better price/product mix in both our specialty and core ingredients, cost
synergies related to the Penford acquisition, as well as operational
efficiencies driven by our network optimization efforts accounted for the
increase.
* Year-to-date operating income increased from $229 million to $309 million.
Higher acquisition-related volumes, a better price/product mix in both our
specialty and core ingredients, cost synergies related to the Penford
acquisition, as well as operational efficiencies driven by our network
optimization efforts accounted for the increase.
South America
+--------------+-------------+---------+------+---------+-------------+--------+
|$ in millions | 2015 Net |FX Impact|Volume|Price/mix| 2016 Net |% change|
| | sales | | | | sales | |
+--------------+-------------+---------+------+---------+-------------+--------+
|Second quarter| 250 | -54 | -14 | 59 | 240 | -4% |
+--------------+-------------+---------+------+---------+-------------+--------+
|Year-to-date | 508 | -142 | -29 | 117 | 455 | -10% |
+--------------+-------------+---------+------+---------+-------------+--------+
Operating income
* Operating income in the second quarter was $14 million, down $6 million from
a year ago. The decline was largely a result of lower volumes in Southern
Cone driven by macroeconomic headwinds, and higher costs for corn and other
inputs. This was partially mitigated by improved price/mix.
* Year-to-date operating income was $32 million, down $13 million from a year
ago. The decline was largely a result of the negative effect of foreign
exchange, lower volumes in Southern Cone driven by macroeconomic headwinds,
and higher costs for corn and other inputs. This was partially mitigated by
improved price/mix.
Asia Pacific
+--------------+-------------+---------+------+---------+-------------+--------+
|$ in millions | 2015 Net |FX Impact|Volume|Price/mix| 2016 Net |% change|
| | sales | | | | sales | |
+--------------+-------------+---------+------+---------+-------------+--------+
|Second quarter| 192 | -8 | 4 | -8 | 180 | -6% |
+--------------+-------------+---------+------+---------+-------------+--------+
|Year-to-date | 379 | -20 | 4 | -14 | 349 | -8% |
+--------------+-------------+---------+------+---------+-------------+--------+
Operating income
* Second quarter operating income was $30 million, up $2 million from a year
ago. Year-to-date operating income was $58 million, up $4 million from a
year ago. In both periods, volume growth and margin expansion were partially
offset by foreign exchange impacts.
Europe, Middle East, Africa (EMEA)
+--------------+-------------+---------+------+---------+-------------+--------+
|$ in millions | 2015 Net |FX Impact|Volume|Price/mix| 2016 Net |% change|
| | sales | | | | sales | |
+--------------+-------------+---------+------+---------+-------------+--------+
|Second quarter| 138 | -3 | 6 | -1 | 140 | 2% |
+--------------+-------------+---------+------+---------+-------------+--------+
|Year-to-date | 269 | -8 | 19 | -5 | 276 | 2% |
+--------------+-------------+---------+------+---------+-------------+--------+
Operating income
* Second quarter operating income was $29 million, up $6 million from a year
ago. Year-to-date operating income was $55 million, up $10 million from a
year ago. In both periods, volume growth and margin expansion more than
offset foreign exchange impacts.
2016 Guidance
2016 adjusted EPS, excluding acquisition-related, integration, and restructuring
costs as well as any potential impairment costs, is expected to be in the range
of $6.70 to $6.90 compared to adjusted EPS of $5.88 in 2015. The full-year
guidance assumes, compared to last year: overall improvement in North America,
Asia Pacific and EMEA, and South America down given the macroeconomic
environment; an effective tax rate of approximately 30-32 percent; and continued
trade up in our portfolio, including higher-value specialty ingredients, leading
to margin expansion.
In 2016, cash generated by operations is expected to be in the range of $725
million to $775 million and capital expenditures are anticipated to be $300
million.
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 webcast in real time, and will include a visual presentation
accessible through the Ingredion website at www.ingredion.com. The presentation
will be available to download a few hours 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 ingredient solutions
provider. We turn corn, tapioca, potatoes and other vegetables and fruits into
value-added ingredients and biomaterial solutions for the food, beverage, paper
and corrugating, brewing and other industries. Serving customers in over 100
countries, our ingredients make yogurts creamy, candy sweet, paper stronger and
face creams silky. Visit ingredion.com to learn more.
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," "assume", "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 circumstances or 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;
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, paper, corrugated, 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 potato starch, 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.
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, 2015 and subsequent reports on Forms 10-Q
and 8-K.
CONTACT:
Investors: Heather Kos, 708-551-2592
Media: Claire Regan, 708-551-2602
Q2 2016 PR Tables :
http://hugin.info/147221/R/2031288/755766.pdf
This announcement is distributed by GlobeNewswire on behalf of
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#2031288]
Unternehmensinformation / Kurzprofil:
Datum: 28.07.2016 - 12:30 Uhr
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News-ID 486066
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