(By Balachander) International Flavors & Fragrances Inc. (NYSE:IFF) reported double-digit earnings growth for the second quarter on expansion in margins and said it is cautiously optimistic in its outlook amid softness in Fragrance Ingredients and weak economic conditions in Western Europe.
On an adjusted basis, earnings per share (EPS) grew 11 percent to $1.08, beating Wall Street expectations of $1.02. Net earnings increased 16 percent to $89 million.
Net revenue was 1 percent higher at $721.3 million, yet trailed consensus estimate of a growth of 1.90 percent. On a like-for-like basis, local currency sales gained 5 percent.
Gross margin improved to 41.8 percent from 39.7 percent in the same period last year. Adjusted operating margin expanded 130 basis points to 18.3 percent.
IFF's Flavors unit registered revenue growth of 5 percent as double-digit like-for-like growth at North America and Greater Asia drove results. At the company's Fragrances unit, revenue decreased 3 percent due to volume declines in Ingredients.
The company's Fragrances segment provides functional fragrances for personal care and household products; fine fragrance and beauty care, including perfumes, colognes, and toiletries. Flavors segment offers flavor compounds for use in consumer products, such as prepared foods, beverages, dairy, food, and sweet products.
Shares of the New York-based company ended Tuesday's regular trading session at $56.52. The stock has been trading in the 52-week range between $51.20 and $63.78 .