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What changed in SENSIENT TECHNOLOGIES CORP's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of SENSIENT TECHNOLOGIES CORP's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+233 added−204 removedSource: 10-K (2026-02-13) vs 10-K (2025-02-19)

Top changes in SENSIENT TECHNOLOGIES CORP's 2025 10-K

233 paragraphs added · 204 removed · 182 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

39 edited+10 added−4 removed38 unchanged
Biggest changeThe Company also produces a diverse line of colors and ingredients for personal care, pharmaceutical, and nutraceutical applications, and technical colors for industrial applications. 7 Index Raw Materials The Company uses a wide range of raw materials in producing its products. Chemicals used to produce certified colors are obtained from several domestic and foreign suppliers.
Biggest changeRaw Materials The Company uses a wide range of raw materials in producing its products. Chemicals used to produce certified colors are obtained from several domestic and foreign suppliers. Raw materials for natural colors, such as carmine, annatto, and other botanicals, are sourced internally at our Lima, Peru facility or purchased from overseas and U.S. sources.
The Company’s principal products include: ● flavors, flavor enhancers, ingredients, extracts, and bionutrients; ● essential oils; ● dehydrated vegetables and other food ingredients; ● natural and synthetic food and beverage colors; ● personal care colors and ingredients; ● pharmaceutical and nutraceutical colors, excipients, and ingredients; and ● technical colors, specialty colors, and specialty dyes and pigments.
The Company’s principal products include: ● flavors, flavor enhancers, ingredients, extracts, bionutrients, and essential oils; ● dehydrated vegetables and other food ingredients; ● natural and synthetic food and beverage colors; ● personal care colors and ingredients; ● pharmaceutical and nutraceutical colors, excipients, and ingredients; and ● technical colors, specialty colors, and specialty dyes and pigments.
The Company provides natural and synthetic color systems for use in foods, beverages, pharmaceuticals, and nutraceuticals; colors and other ingredients for personal care, such as active ingredients, solubilizers, and surface treated pigments; pharmaceutical and nutraceutical excipients, such as colors, flavors, and coatings; and technical colors for industrial applications.
The Company provides natural and synthetic color systems for use in foods, beverages, pharmaceuticals, and nutraceuticals; colors and other ingredients such as active ingredients, solubilizers, and surface treated pigments for personal care; pharmaceutical and nutraceutical excipients, such as colors, flavors, and coatings; and technical colors for industrial applications.
The Company believes that it is one of the world’s largest producers (by sales) of synthetic and natural colors, and that it is the world’s largest manufacturer (by sales) of certified food colors. The Company sells its synthetic and natural colors to domestic and international producers of beverages, bakery products, processed foods, confections, pet foods, personal care, pharmaceuticals, and nutraceuticals.
The Company believes that it is one of the world’s largest producers (by sales) of natural and synthetic colors, and that it is the world’s largest manufacturer (by sales) of certified food colors. The Company sells its natural and synthetic colors to domestic and international producers of beverages, bakery products, processed foods, confections, pet foods, personal care, pharmaceuticals, and nutraceuticals.
Most of the Company’s customers do not buy all of their flavor and ingredients products from a single supplier, and the Company does not compete with a single supplier in all product categories.
Most of the Company’s customers do not buy all of their flavor and flavor ingredients products from a single supplier, and the Company does not compete with a single supplier in all product categories.
Competition for the supply of dehydrated vegetables is based principally on product quality, customer service, and price. • Color. Competition in the color market is diverse, with the majority of the Company’s competitors specializing in either synthetic dyes and pigments, natural colors, or coloring foods (in Europe).
Competition for the supply of dehydrated vegetables is based principally on product quality, customer service, and price. • Color. Competition in the color market is diverse, with the majority of the Company’s competitors specializing in either natural colors and/or coloring foods (in Europe) or synthetic dyes and pigments.
Because of its highly differentiated products, the Company competes with only a few companies across multiple product lines and generally encounters different competitors in different product lines. • Flavors & Extracts. Competition in the flavors, extracts, and ingredients industries continues to have an ever-increasing global nature.
Because of its highly differentiated products, the Company competes with only a few companies across multiple product lines and generally encounters different competitors in different product lines. • Flavors & Extracts. Competition in the flavors, extracts, and flavor ingredients industries continues to have an ever-increasing global nature.
Charters for the Audit, Compensation and Development, Nominating and Corporate Governance, Finance, and Executive Committees of the Company’s Board of Directors, as well as the Company’s Code of Conduct, Corporate Governance Guidelines, Policy Relating to Recovery of Erroneously Awarded Compensation, and Non-Employee Directors and Executive Officers Stock Ownership Guidelines are available on the Company’s website.
Charters for the Audit, Compensation and Development, Nominating and Corporate Governance, and Executive Committees of the Company’s Board of Directors, as well as the Company’s Code of Conduct, Corporate Governance Guidelines, Policy Relating to Recovery of Erroneously Awarded Compensation, and Non-Employee Directors and Executive Officers Stock Ownership Guidelines are available on the Company’s website.
The Company believes that it gains a competitive advantage as the only major basic manufacturer of a full range of color products, including synthetic dyes and pigments, and a full range of natural colors and coloring foods.
The Company believes that it gains a competitive advantage as the only major basic manufacturer of a full range of color products, including a full range of natural colors and coloring foods as well as synthetic dyes and pigments.
In food industries, markets include savory, beverage, and sweet flavors, as well as certain bioingredients. In non-food industries, the Group supplies essential oil products to the personal, homecare, and bioingredients markets. Operating through its Natural Ingredients business, the Company believes it is the second largest producer (by sales) of dehydrated onion and garlic products in the United States.
In food industries, markets include savory, beverage, and sweet flavors, as well as certain bioingredients. In non-food industries, the Group supplies essential oil products to the personal, homecare, and bioingredients markets. Operating through its Agricultural Ingredients business, the Company believes it is the second largest producer (by sales) of dehydrated onion and garlic products in the United States.
The Company also makes industrial colors and other dyes and pigments used in a variety of non-food applications. As of December 31, 2024, the Group’s principal manufacturing plants are located in Missouri, Brazil, Canada, China, France, Germany, Italy, Mexico, Peru, Turkey, and the United Kingdom.
The Company also makes industrial colors and other dyes and pigments used in a variety of non-food applications. As of December 31, 2025, the Group’s principal manufacturing plants are located in Missouri, Brazil, Canada, China, France, Germany, Italy, Mexico, Peru, Turkey, and the United Kingdom.
The Flavors & Extracts Group produces flavor, extract, and essential oil products that impart a desired taste, texture, aroma, or other characteristics to a broad range of consumer and other products. This Group includes the Company’s natural ingredients business, which produces dehydrated garlic, onion, and other natural ingredients for food processors.
The Flavors & Extracts Group produces flavor, extract, and essential oil products that impart a desired taste, texture, aroma, or other characteristics to a broad range of consumer and other products. This Group includes the Company’s Agricultural Ingredients business, which produces dehydrated garlic, onion, and other agricultural ingredients for food processors.
Individual goals are set annually for employees, which flow from the Company strategy, and attainment of those goals is an element of the employee’s performance assessment. We invest in our development programs for high-impact roles, such as our General Management Development, Sales Representative Trainee, and Flavorist Trainee programs.
Individual goals are set annually for employees, which flow from the Company strategy, and attainment of those goals is an element of the employee’s performance assessment. We invest in our development programs for high-impact roles, such as our Sales Representative Trainee and Flavorist Trainee programs.
The Company is also one of the largest producers and distributors of chili powder, paprika, chili pepper, and parsley. The Company sells dehydrated products to food manufacturers for use as ingredients and also for repackaging under private labels for sale to the retail market and to the food service industry.
The Company is also one of the largest producers and distributors of chili powder, paprika, chili pepper, and parsley. The Company sells dehydrated products to food manufacturers for use as ingredients and also for repackaging under private labels for sale to the retail market, quick service restaurants, and to the food service industry.
The main products of the Group are systems products, including flavor-delivery systems, and compounded and blended products. In addition, the Group has strong positions in selected ingredient products such as natural and synthetic flavors, natural extracts, and essential oils. The Group serves food and non-food industries.
The main products of the Group are systems products, including flavor-delivery systems, taste modulation systems, and compounded and blended products. In addition, the Group has strong positions in selected ingredient products such as natural and synthetic flavors, natural extracts, and essential oils. The Group serves food and non-food industries.
For 2024, the Company’s three reportable segments were the Flavors & Extracts Group and the Color Group, which are managed on a product line basis, and the Asia Pacific Group, which is managed on a geographic basis.
For 2025, the Company’s three reportable segments were the Flavors & Extracts Group and the Color Group, which are managed on a product line basis, and the Asia Pacific Group, which is managed on a geographic basis.
The dehydration technologies utilized by our Natural Ingredients business permit fast and effective rehydration of ingredients used in many of today’s popular convenience foods. As of December 31, 2024, the Group’s principal manufacturing plants are located in California, Illinois, Michigan, Wisconsin, New Mexico, Belgium, Costa Rica, Mexico, Germany, and the United Kingdom.
The dehydration technologies utilized by our Agricultural Ingredients business permit fast and effective rehydration of ingredients used in many of today’s popular convenience foods. As of December 31, 2025, the Group’s principal manufacturing plants are located in California, Illinois, Michigan, Wisconsin, New Mexico, Belgium, Costa Rica, Mexico, Germany, and the United Kingdom.
The Company believes that its advanced process technology, state-of-the-art laboratory facilities and equipment, world-class application chemists, agronomy program, and complete range of natural and synthetic color products constitute the basis for its market leadership position.
The Company believes that its advanced process technology, state-of-the-art laboratory facilities and equipment, world-class application chemists, redundant manufacturing capabilities, agronomy and sourcing program, and complete range of natural and synthetic color products constitute the basis for its market leadership position.
Examples of processes in place to ensure that we provide safe products to our customers include the following: (i) comprehensive and robust raw material approval processes; (ii) analyses of raw materials and finished goods for compliance with specifications prior to use and shipment, respectively; and (iii) established guidelines for Good Manufacturing Practices (GMP) and Hazard Analysis and Critical Control Points (HACCP).
Examples of processes in place to ensure that we provide safe products to our customers include the following: (i) comprehensive and robust raw material approval processes; (ii) analyses of raw materials and finished goods for compliance with specifications prior to use and shipment, respectively; (iii) established guidelines for Good Manufacturing Practices (GMP) and Hazard Analysis and Critical Control Points (HACCP); and (iv) the rigorous application of our Certasure® program to ensure the safety of our natural color raw materials.
The Company’s efforts also include the development of proprietary seed lines, sometimes in partnership with other business partners, for its natural ingredients and natural colors business lines. The Company employed 772 people in research and development, quality assurance, agronomy, quality control, and lab technician positions as of December 31, 2024.
The Company’s efforts also include the development of proprietary seed lines and other technologies, sometimes in partnership with other business partners, for its agricultural ingredients and natural colors business lines. The Company employed 807 people in research and development, quality assurance, agronomy, quality control, and lab technician positions as of December 31, 2025.
Corporate Corporate provides management, administrative, and support services to the Company from its headquarters in Milwaukee, Wisconsin. The Company’s corporate expenses, divestiture & other related income, share-based compensation, restructuring and other charges, including the Portfolio Optimization Plan costs, and other costs, are included in the “Corporate & Other” category.
Corporate Corporate provides management, administrative, and support services to the Company from its headquarters in Milwaukee, Wisconsin. The Company’s corporate expenses, share-based compensation (except for share-based compensation expense associated with stock grants to certain business unit leaders) , restructuring and other charges, including the Portfolio Optimization Plan costs, and other costs, are included in the “Corporate & Other” category.
The Company’s corporate expenses, divestiture & other related income, share-based compensation, restructuring and other charges, including the Portfolio Optimization Plan costs, and certain other costs are included in the “Corporate & Other” category as described in this report.
The Company’s corporate expenses, share-based compensation (except for share-based compensation expense associated with stock grants to certain business unit leaders) , restructuring and other charges, including the Portfolio Optimization Plan costs, and certain other costs are included in the “Corporate & Other” category as described in this report.
Within the Color Group, development activity for food and beverage product lines is focused on value-added products derived from natural food and beverage colors, synthetic dyes and pigments, and color systems.
Within the Color Group, development activity for food and beverage product lines is focused on value-added products derived from natural food and beverage colors, synthetic dyes and pigments, and color systems. The Company also produces a diverse line of colors and ingredients for personal care, pharmaceutical, and nutraceutical applications, and technical colors for industrial applications.
Patents, Formulae, and Trademarks The Company owns or controls many patents, formulae, and trademarks related to its businesses. The businesses are not materially dependent upon any particular patent, trademark, or formula; however, trademarks, patents, and formulae are important to the business of the Company. Human Capital As of December 31, 2024, the Company employed 4,014 persons worldwide.
The businesses are not materially dependent upon any particular patent, trademark, or formula; however, trademarks, patents, and formulae are important to the business of the Company. Human Capital As of December 31, 2025, the Company employed 4,070 persons worldwide. Approximately 45% of our employees were employed in the United States, and approximately 55% were employed outside of the United States.
Health and Safety We take pride in our strong and continually improving health and safety programs, which we view as important aspects of our economic health and core values, and we expect each employee to actively participate in and contribute to our goal of always providing a safe work place.
In addition, we strictly apply principles of non-discrimination, which are foundational to our non-negotiable expectations of integrity and professionalism, in all employment-related decisions. 9 Index Health and Safety We take pride in our strong and continually improving health and safety programs, which we view as important aspects of our economic health and core values, and we expect each employee to actively participate in and contribute to our goal of always providing a safe workplace.
We also maintain a corporate physical security program led by a retired Secret Service Agent. The physical security program aims to secure our facilities, protect our employees from workplace violence, ensure proper training and monitoring of travelers, and provide regular assessments of the security situations in the countries where we operate.
The physical security program aims to secure our facilities, protect our employees from workplace violence, ensure proper training and monitoring of travelers, and provide regular assessments of the security situations in the countries where we operate. The Board of Directors also receives a report on personnel safety-related issues at each of its meetings.
In furtherance of this goal, our primary areas of focus remain: (i) talent acquisition, (ii) onboarding, (iii) coaching, development, and retention, and (iv) integrity and professionalism. As part of the Company’s effort to attract and motivate employees, we offer compensation and comprehensive benefits that we believe are competitive in the markets in which we operate and compete for talent.
As part of the Company’s effort to attract and motivate employees, we offer compensation and comprehensive benefits that we believe are competitive in the markets in which we operate and compete for talent.
The Board of Directors also receives a report on personnel safety related issues at each of its meetings. 9 Index Food Safety We maintain a robust program related to food safety, including proactive, preventive measures to ensure the quality of our products.
Food Safety We maintain a robust program related to food safety, including proactive, preventive measures to ensure the quality of our products.
The Company’s flavor formulations are used in many of the world’s best-known consumer products. Under the unified brand names of Sensient Flavors and Sensient Natural Ingredients, the Group is a supplier to multinational and regional companies.
Under the unified brand names of Sensient Flavors and Sensient Agricultural Ingredients, the Group is a supplier to multinational and regional companies.
To further reinforce our expectations, the CEO internally publishes anonymized quarterly reports of Code of Conduct violations and their consequences, which invariably means termination of employment. In addition, we strictly apply principles of non-discrimination, which are foundational to our non-negotiable expectations of integrity and professionalism, in all employment-related decisions.
To further reinforce our expectations, the CEO internally publishes anonymized quarterly reports of Code of Conduct violations and their consequences, which is invariably termination of employment.
Financial information regarding the Company’s three reportable segments and the operations included within Corporate & Other is set forth in Note 12, Segment and Geographic Information , in the Notes to Consolidated Financial Statements included in this report. Acquisitions On October 3, 2022, the Company acquired Endemix Doğal Maddeler A.Ş. and Teknoloji Yatırımları ve Danışmanlık Sanayi ve Ticaret A.Ş.
Financial information regarding the Company’s three reportable segments and the operations included within Corporate & Other is set forth in Note 12, Segment and Geographic Information , in the Notes to Consolidated Financial Statements included in this report. Acquisition On February 14, 2025, the Company acquired Biolie SAS , a natural color extraction business located in France.
The majority of the proprietary processes and formulae developed by the Company are maintained as trade secrets and protected through internal physical and information technology controls and confidentiality agreements with customers as well as confidentiality and non-competition agreements with employees (where permitted).
The majority of the proprietary processes and formulae developed by the Company are maintained as trade secrets and protected through internal physical and information technology controls and confidentiality agreements with customers as well as confidentiality and non-competition agreements with employees (where permitted). 7 Index Within the Flavors & Extracts Group, development activity is focused on flavors, natural extracts, ingredients, and essential oils as well as flavor systems, including taste modulation, that are responsive to consumer trends and the processing needs of our food and beverage customers.
Onion, garlic, chili peppers, and other vegetables are acquired under annual production contracts with numerous growers in the western United States.
These raw materials are obtained from domestic and foreign suppliers. Flavor enhancers and secondary flavors are produced from brewers’ yeast and vegetable materials such as corn and soybeans. Onion, garlic, chili peppers, and other vegetables are acquired under annual production contracts with numerous growers in the western United States.
The Board also has routine contact with all Company officers and periodically receives presentations from the Group Presidents and Vice President as well as select General Managers. 8 Index Talent Acquisition and Talent Development We are committed to the recruitment, retention, and continued development of people who thrive and succeed in our culture.
Our Board of Directors oversees our human capital management program, in consultation with our CEO and Vice President, Human Resources. The Board also has routine contact with all Company officers and periodically receives presentations from the Group Presidents and Vice President as well as select General Managers.
This business is part of the Color segment. 5 Index Divestitures In 2022, the Company received $2.5 million of net cash related to the previously completed sale of its yogurt fruit preparations product line. Flavors & Extracts Group The Company is a global developer, manufacturer, and supplier of flavor systems for the food, beverage, and personal care industries.
This business is part of the Color segment. 5 Index Flavors & Extracts Group The Company is a global developer, manufacturer, and supplier of flavor systems for the food, beverage, and personal care industries. The Company’s flavor formulations are used in many of the world’s best-known consumer products.
Competition is based upon reliability in product quality, service, and price as well as technical support available to customers. Foreign Operations Additional information regarding the Company’s foreign operations is set forth in Note 12, Segment and Geographic Information , in the Notes to Consolidated Financial Statements included in this report.
Competition is based upon reliability in product quality, service, and price as well as technical support available to customers.
Raw materials for natural colors, such as carmine, beta-carotene, annatto, and turmeric, are sourced internally at our Lima, Peru facility or purchased from overseas and U.S. sources. Since October 2022, the Company has owned a natural food colorings business located near Istanbul, Turkey, and has vertically integrated production and processing capacity in black carrot and other natural color products.
The Company also operates a natural food colors facility located near Istanbul, Turkey, and has vertically integrated production and processing capacity in black carrot and other natural color products.
Approximately 44% of our employees were employed in the United States, and approximately 56% were employed outside of the United States. Of our 4,014 employees worldwide, we had 507 general administration employees ( e.g. , accounting, administrative, regulatory compliance, IT, human resources, etc.), 2,502 production employees, 458 research and development employees, and 547 sales and marketing employees.
Of our 4,070 employees worldwide, we had 522 general administration employees ( e.g. , accounting, administrative, regulatory compliance, IT, human resources, legal, etc.), 2,492 production employees, 496 research and development employees, and 560 sales and marketing employees. We believe that our future success is dependent upon our continued ability to attract, retain, and motivate successful employees.
Given its broad portfolio of natural colors and applications capabilities, the Company believes it has the capability to successfully adapt to any regulatory restrictions on synthetic colors. 6 Index Asia Pacific Group The Asia Pacific Group focuses on marketing the Company’s diverse product lines in the Pacific Rim under the Sensient name.
The Company has significantly invested in building its natural color capabilities over the last 15 years and continues to make significant capital investments to meet this opportunity. Asia Pacific Group The Asia Pacific Group focuses on marketing the Company’s diverse product lines in the Pacific Rim and India under the Sensient name.
Removed
(collectively, Endemix), a natural colors business located in Turkey. The Company paid $23.3 million in cash for this acquisition, which is net of $1.3 million in debt assumed.
Added
The Company paid $4.9 million in cash for this acquisition, which is net of $0.2 million in debt assumed. The assets acquired and liabilities assumed were recorded at their estimated fair value as of the acquisition date. The Company acquired net assets of $0.3 million, with the remaining $4.6 million allocated to goodwill.
Removed
Within the Flavors & Extracts Group, development activity is focused on flavors, natural extracts, ingredients, and essential oils as well as flavor systems that are responsive to consumer trends and the processing needs of our food and beverage customers.
Added
During 2025, the Company changed the name of its Sensient Natural Ingredients product line to Sensient Agricultural Ingredients to clearly distinguish it from the natural color activities within the Food & Pharmaceutical Colors product line within the Color Group.
Removed
In the production of flavors, extracts, and essential oils, the principal raw materials include essential oils, botanicals, extracts, fruits, and juices. These raw materials are obtained from domestic and foreign suppliers. Flavor enhancers and secondary flavors are produced from brewers’ yeast and vegetable materials such as corn and soybeans.
Added
Given its broad portfolio of natural colors and applications capabilities, the Company believes it has the capability to successfully adapt to any regulatory restrictions on synthetic colors. 6 Index In 2025, the process of converting the United States food market from synthetic to natural colors gained significant momentum as a result of legislative action in various states, political support from the Trump administration, and announcements of commitments to eliminate synthetic food colorants by several major United States companies.
Removed
We believe that our future success is dependent upon our continued ability to attract, retain, and motivate successful employees. Our Board of Directors oversees our human capital management program, in consultation with our CEO and Vice President, Human Resources.
Added
As a result of the aforementioned developments, the Company is in the process of accelerating its efforts to enable the conversion of its synthetic food color business in North America (of approximately $100 million in revenue) to natural colors.
Added
Because much more natural color is generally needed to replicate the appearance of a synthetic color in an existing product, this conversion activity presents major opportunities for the Company and requires increased commercial and R&D activity to support customers and significant investment around the world to increase the Company’s production capacity, optimize and expand its product portfolio, and build a resilient supply chain.
Added
These capabilities are particularly important in transitioning customers from using synthetic to natural colors as this change often requires sophisticated formulation and production capabilities as well as the complete reformulation of customer product formulas given the higher usage rates of natural colors.
Added
Other botanicals and other ingredients derived from botanicals, including beta-carotene, beet, carrot, potato, butterfly pea flower, spirulina, and paprika, are sourced in various geographies through local partnerships, which are generally vertically integrated with local farmers and juicing/extraction facilities. In the production of flavors, extracts, and essential oils, the principal raw materials include essential oils, botanicals, extracts, fruits, and juices.
Added
Foreign Operations Additional information regarding the Company’s foreign operations is set forth in Note 12, Segment and Geographic Information , in the Notes to Consolidated Financial Statements included in this report. 8 Index Patents, Formulae, and Trademarks The Company owns or controls many patents, formulae, and trademarks related to its businesses.
Added
Talent Acquisition and Talent Development We are committed to the recruitment, retention, and continued development of people who thrive and succeed in our culture. In furtherance of this goal, our primary areas of focus remain: (i) talent acquisition, (ii) onboarding, (iii) coaching, development, and retention, and (iv) integrity and professionalism.
Added
We also maintain a corporate physical security program led by a retired Secret Service Agent, who served on the security details of two Presidents and as a member of the Secret Service’s Counter-Assault Team.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

62 edited+21 added−13 removed102 unchanged
Biggest changeWe are also likely to incur additional third-party service provider costs, including sustainability platform fees, audit costs, and other service fees from sustainability professionals in order to remain compliant with newly enacted regulations, laws, and demands, including the European Union Corporate Sustainability Reporting Directive and California SB 253 and SB 261, as amended by SB 219.
Biggest changeIf we are unable to respond, or we are perceived to be responding inadequately, to the expectations of our stakeholders, our business and reputation could be harmed, our profit and revenue could decline, and it could have a negative impact on the trading price of our common stock. 15 Index In addition, we are also likely to incur additional third-party service provider costs, including sustainability platform fees, audit costs, and other service fees from sustainability professionals in order to remain compliant with newly enacted regulations, laws, and demands, including international laws such as the European Union Corporate Sustainability Reporting Directive and state laws such as the California climate laws.
Commodity and energy prices are subject to significant volatility caused by market fluctuations, supply and demand, currency fluctuation, production and transportation disruption, disruptive world events (such as the Russia-Ukraine and Middle Eastern conflicts and related disruptions in the Red Sea and Arabian Sea discussed above), and changes in governmental regulations, particularly related to carbon reduction.
Commodity and energy prices are subject to significant volatility caused by market fluctuations, supply and demand, currency fluctuation, production and transportation disruption, disruptive world events (such as the Russia-Ukraine and Middle Eastern conflicts discussed above and related disruptions in the Red Sea and Arabian Sea), and changes in governmental regulations, particularly related to carbon reduction.
And, while we maintain liability insurance against these risks, coverage may be unavailable or incomplete. In addition, the Company is subject to a variety of laws and regulations in the United States and other jurisdictions regarding privacy, data protection, and data security, including those related to the collection, storage, handling, use, disclosure, transfer, and security of personal data.
And, while we maintain liability insurance against these risks, coverage may be unavailable or incomplete. In addition, the Company is subject to a variety of laws and regulations in the United States and other jurisdictions regarding privacy, cybersecurity, data protection, and data security, including those related to the collection, storage, handling, use, disclosure, transfer, and security of personal data.
We may not be able to pass these costs to customers for a variety of reasons, including the fact that some of our competitors may not be subject to the increased costs. Additionally, government regulatory action against any of our suppliers or particular raw materials could also cause a supply disruption.
We may not be able to pass these costs to customers for a variety of reasons, including the fact that some of our competitors may not be subject to such increased costs. Additionally, government regulatory action against any of our suppliers or particular raw materials could also cause a supply disruption.
Because Mazza’s extraction process proved to not be economically viable, we elected to close the former Mazza plant as part of our Portfolio Optimization Plan, while retaining the intellectual property for future use in the event it does become economically viable.
Because Mazza’s extraction process proved to not be economically viable, we elected to close the former Mazza plant in 2024 as part of our Portfolio Optimization Plan, while retaining the intellectual property for future use in the event it does become economically viable.
If one of our development or manufacturing facilities is disrupted or impaired, we could cause a supply disruption to our customers, which could cause short and long-term damage to our customer relationships and a reduction in our revenue and an increase in our costs.
If one of our research and development or manufacturing facilities is disrupted or impaired, we could cause a supply disruption to our customers, which could cause short and long-term damage to our customer relationships and a reduction in our revenue and an increase in our costs.
We develop, manufacture, and sell flavors, flavor enhancers, ingredients, extracts, and bionutrients; essential oils; natural ingredients, including dehydrated vegetables and other food ingredients; natural and synthetic food and beverage colors; personal care colors and ingredients; pharmaceutical and nutraceutical excipients and ingredients; and technical colors, specialty colors, and specialty dyes and pigments.
We develop, manufacture, and sell flavors, flavor enhancers, ingredients, extracts, and bionutrients; essential oils; agricultural ingredients, including dehydrated vegetables and other food ingredients; natural and synthetic food and beverage colors; personal care colors and ingredients; pharmaceutical and nutraceutical excipients and ingredients; and technical colors, specialty colors, and specialty dyes and pigments.
It may become more difficult to obtain and enforce non-competition agreements in the future, as there are various federal and state efforts ongoing in the U.S. that would prohibit or limit them.
It may become more difficult to obtain and enforce non-competition agreements in the future, as there are various state efforts ongoing in the U.S. that would prohibit or limit them.
Even if a product liability claim is unsuccessful or is not fully pursued, the cost of defense and the negative publicity surrounding any assertion that our products caused illness, injury, or death or any recall involving our products could adversely affect our reputation with existing and potential customers and our corporate image and thereby adversely impact our profitability. • There are an enormous number of laws and regulations applicable to us, our suppliers, and our customers across all of our business lines.
Even if a product liability claim is unsuccessful or is not fully pursued, the cost of defense and the negative publicity surrounding any assertion that our products caused illness, injury, or death or any recall involving our products could adversely affect our reputation with existing and potential customers and our corporate image and thereby adversely impact our profitability. 16 Index • There are an enormous number of laws and regulations applicable to us, our suppliers, and our customers across all of our business lines.
Compliance with and interpretation of various data privacy regulations continue to evolve and any violation could subject the Company to legal claims, regulatory penalties, and damage to its reputation.
Compliance with and interpretation of various data privacy and cybersecurity regulations continue to evolve, and any violation could subject the Company to legal claims, regulatory penalties, and damage to its reputation.
Acquisitions also generally result in goodwill, which would need to be written off against earnings in the future if it becomes impaired. Acquisitions and investments may involve significant cash expenditures, debt incurrences, equity issuances, operating losses, and expenses. Technology and Cybersecurity Risks • Our ability to protect our intellectual property rights is key to our performance.
Acquisitions also generally result in goodwill, which would need to be written off against earnings in the future if it becomes impaired. Acquisitions and investments may involve significant cash expenditures, debt incurrences, equity issuances, operating losses, and expenses. 18 Index Technology and Cybersecurity Risks • Our ability to protect our intellectual property rights is key to our performance.
In addition, if any of these large customers are able to produce the products that we otherwise supply them, our results of operations may be adversely impacted. • Our sales and profitability are affected by changing consumer preferences, changing regulations and technologies, and our ability and our customers’ ability to make and sell to consumers in highly competitive markets.
In addition, if any of these large customers are able to produce the products that we otherwise supply them, our results of operations may be adversely impacted. 12 Index • Our sales and profitability are affected by changing consumer preferences, changing regulations and technologies, and our ability and our customers’ ability to make and sell to consumers in highly competitive markets.
Increasing our prices also may reduce sales volume and related profitability and cause us to lose customers. If inflationary conditions persist, accelerate, or expand, it will become more difficult to manage these challenges without adverse impacts to our revenues and profitability. 13 Index We use various energy sources in our production and distribution processes.
Increasing our prices also may reduce sales volume and related profitability and cause us to lose customers. If inflationary conditions persist, accelerate, or expand, it will become more difficult to manage these challenges without adverse impacts to our revenues and profitability. We use various energy sources in our production and distribution processes.
In addition to the other discussions in this report, particularly those under the headings “Management’s Discussion and Analysis of Financial Condition and Results of Operations” below and “Forward-Looking Statements” above, the following factors should be considered: Business Risks • Intense competition with our competitors may result in reduced sales and profitability.
In addition to the other discussions in this report, particularly those under the headings “Management’s Discussion and Analysis of Financial Condition and Results of Operations” below and “Forward-Looking Statements” above, the following factors should be considered: 10 Index Business Risks • Intense competition with our competitors may result in reduced sales and profitability.
Stakeholder and regulatory focus on ESG matters requires us to continuously monitor various developing standards and reporting requirements and make continuous progress in our efforts to reduce our, as well as our suppliers’, energy consumption, greenhouse gas emissions, water usage, and waste generation. Implementing such monitoring, reporting, and improved sustainability could be costly.
Stakeholder and regulatory focus on ESG matters require us to continuously monitor various developing standards and reporting requirements and make continuous progress in our efforts to reduce our, as well as our suppliers’, energy consumption, greenhouse gas emissions, water usage, and waste generation. Implementing such monitoring, reporting, and improved sustainability could be costly.
Any future unavailability or shortage of a raw material, however caused, could negatively affect our operations using that raw material and thus adversely affect our results. • We may not be able to manage inventory as effectively as anticipated, which may adversely impact our performance. Efficient inventory management is essential to our performance.
Any future unavailability or shortage of a raw material, however caused, could negatively affect our operations using that raw material and thus adversely affect our results. 13 Index • We may not be able to manage inventory as effectively as anticipated, which may adversely impact our performance. Efficient inventory management is essential to our performance.
These factors might adversely impact our ability to make certain products as well as our profitability on the products that can be made. 16 Index • We could be adversely affected by violations of anti-bribery and anti-corruption laws and regulations. Our business is subject to the U.S.
These factors might adversely impact our ability to make certain products as well as our profitability on the products that can be made. • We could be adversely affected by violations of anti-bribery and anti-corruption laws and regulations. Our business is subject to the U.S.
Those developments could negatively affect our results. 11 Index • The impact of tariffs and other trade barriers may negatively affect our results. The Company has manufacturing facilities located around the world. The Company sells to customers located both inside and outside the countries in which products are manufactured.
Those developments could negatively affect our results. • The impact of tariffs and other trade barriers may negatively affect our results. The Company has manufacturing facilities located around the world. The Company sells to customers located both inside and outside the countries in which products are manufactured.
Additionally, proving the theft of trade secrets in the food ingredient industry is exceedingly difficult. 17 Index • We face risks associated with strategic transactions that we have completed and may pursue in the future, which could adversely affect our operating results.
Additionally, proving the theft of trade secrets in the food ingredient industry is exceedingly difficult. • We face risks associated with strategic transactions that we have completed and may pursue in the future, which could adversely affect our operating results.
In the event that there is an insufficient supply of water for our operations or the operations of the growers that we contract with, our Natural Ingredients business may be materially impacted and could have an adverse effect on our results in future periods.
In the event that there is an insufficient supply of water for our operations or the operations of the growers that we contract with, our Agricultural Ingredients business may be materially impacted and could have an adverse effect on our results in future periods.
In addition, changes in policies by the United States or foreign governments could negatively affect our operating results due to changes in duties, tariffs, trade regulations, employment regulations, taxes, or limitations on currency or fund transfers.
In addition, changes in policies by the United States or foreign governments could negatively affect our operating results due to changes in duties, tariffs, trade regulations and sanctions, employment regulations, taxes, or limitations on currency or fund transfers.
Our customers face intense competition . This competitive pressure has caused some of our customers to change or reduce ordering patterns, to resist price increases, to discontinue or reduce existing product offerings, and to introduce fewer new products and reduce or eliminate traditional limited time offerings.
This competitive pressure has caused some of our customers to change or reduce ordering patterns, to resist price increases, to discontinue or reduce existing product offerings, and to introduce fewer new products and reduce or eliminate traditional limited time offerings.
Even where we make progress, our ESG practices still may not meet the standards of all of our stakeholders. For example, many of our large, global customers are committing to long-term targets to reduce greenhouse gas emissions within their supply chains.
Even where we make progress, our ESG practices still may not meet the standards of all of our stakeholders. For example, many of our large, global customers have committed to long-term targets to reduce greenhouse gas emissions within their supply chains.
There is risk that other customers of the Company could enter bankruptcy or receivership in the near-term as several smaller customers did in 2024.
There is risk that other customers of the Company could enter bankruptcy or receivership in the near-term as several smaller customers did in recent years.
Such disruption would have an adverse effect on our financial performance and future growth. • Intense competition among our customers and their competitors may result in reduced sales and profitability for our customers and us. Generally, we do not sell products directly to consumers. The customers to whom we sell our products incorporate our products into their own products.
Such disruption would have an adverse effect on our financial performance and future growth. 11 Index • Intense competition among our customers and their competitors may result in reduced sales and profitability for our customers and us. Generally, we do not sell products directly to consumers.
While we have a broad portfolio of natural color and applications capabilities that enable us to offer alternatives and replacements for synthetic colors to customers, it is possible that such laws could reduce our revenue if our customers find alternative suppliers or remove color from their products. 12 Index • If we do not maintain an efficient cost structure, our profitability could decrease.
While we have a broad portfolio of natural color and applications capabilities that enable us to offer alternatives and replacements for synthetic colors to customers, it is possible that such laws could reduce our revenue if our customers find alternative suppliers or remove color from their products.
For example, our Natural Ingredients business has significant operations in California, which has been dealing with drought conditions, flooding, plant diseases, and water supply issues, which such issues had negatively impacted certain of our yields from onion harvests in prior years as discussed above.
For example, our Agricultural Ingredients business has significant operations in California, which has been recently dealing with flooding and plant disease issues, which such issues had negatively impacted certain of our yields from onion harvests in prior years, as discussed above.
Disruptions or other issues with those suppliers could affect the availability of those materials. Even if there are multiple suppliers of a particular raw material, there are occasionally shortages. Constrictions in supply of raw materials can lead to increased costs.
In addition, we obtain some raw materials from a single supplier or a limited number of suppliers. Disruptions or other issues with those suppliers could affect the availability of those materials. Even if there are multiple suppliers of a particular raw material, there are occasionally shortages. Constrictions in supply of raw materials can lead to increased costs.
If these beneficial tariffs were reduced or eliminated, it could adversely affect these businesses; on the other hand, if these tariffs were increased, these businesses might benefit, but our broader business and financial condition could still be adversely impacted by increases in tariffs and restrictions on trade. • Consolidation has resulted in customers with increased buying power, which can affect our profitability.
If these beneficial tariffs were reduced or eliminated, it could adversely affect these businesses; on the other hand, if these tariffs were increased, these businesses might benefit, but our broader business and financial condition could still be adversely impacted by increases in tariffs and restrictions on trade.
As discussed above, the price pressures in our markets make such cost reduction efforts particularly important. For example, in 2023, the Company began the execution of a Portfolio Optimization Plan to optimize certain production facilities, centralize and eliminate certain production and selling and administrative positions, and improve efficiencies globally within the Company.
As discussed above, the price pressures in our markets make such cost reduction efforts particularly important. For example, the Company has substantially completed all actions contemplated under a Portfolio Optimization Plan to optimize certain production facilities, centralize and eliminate certain production and selling and administrative positions, and improve efficiencies globally within the Company.
We increased the amount of onion and garlic planted in 2024, but there is no certainty that we will achieve greater yields or, if we do increase our yields, that there will be a market for such products.
While we can increase the amount of onion planted in future periods, there is no certainty that we will achieve greater yields or, if we do increase our yields, that there will be a market for such products.
In addition, some of our customers and other stakeholders are requiring us to provide information on our plans relating to certain ESG matters, such as greenhouse gas emissions (including carbon scores for particular products we supply), and we expect this trend to continue as more regulations are being adopted.
In addition, some of our customers and other stakeholders are requiring us to provide information on our plans relating to certain ESG matters, such as greenhouse gas emissions (including product carbon footprints for particular products we supply).
For example, current macroeconomic and political instability caused by rising interest rates, global supply chain disruptions, inflation, ongoing conflicts between Russia and Ukraine as well as in the Middle East, geopolitical tensions, and the strengthening of the U.S. dollar, have adversely impacted, and could continue to adversely impact, our results of operations.
For example, current macroeconomic and political instability caused by high interest rates, global supply chain disruptions, inflation, ongoing conflicts between Russia and Ukraine as well as in the Middle East, and geopolitical tensions have adversely impacted, and could continue to adversely impact, our results of operations. Some of our suppliers are located in areas facing significant conflict.
In addition, while we have manufacturing facilities throughout the world, certain of our facilities are the sole manufacturer of a specific product, and a disruption in manufacturing could lead to increased costs of relocating or replacing the production of a product, or reformulating a product, which could have an adverse effect on our results. 15 Index Litigation and Regulatory Risks • Many of our products are used in items for human consumption and contact.
In addition, while we have manufacturing facilities throughout the world, certain of our facilities are the sole manufacturer of a specific product, and a disruption in manufacturing could lead to increased costs of relocating or replacing the production of a product, or reformulating a product, which could have an adverse effect on our results.
In addition, individual states may also enact regulations prohibiting or limiting the manufacturing and/or sale of goods containing certain of our products (such as the FDA ban on Red 3 and the California School Food Safety Act’s prohibition on the use of synthetic food colors in school lunches after December 31, 2027), which could cause a decrease in our sales of such products and negatively impact our results of operations.
In addition, individual states may also enact regulations prohibiting or limiting the manufacturing and/or sale of goods containing certain of our products (such as the FDA ban on Red 3, various states’ prohibitions on the use of synthetic food colors in school lunches, and West Virginia’s preliminarily enjoined ban on specified synthetic food colors), which could cause a decrease in our sales of such products and negatively impact our results of operations.
In addition, the credit markets provide us with liquidity to operate and grow our business beyond the liquidity that our cash flows provide. A worldwide economic downturn and/or disruption of the credit markets could reduce our access to capital or significantly increase our costs of capital, which may negatively impact our financial condition, results of operations, and cash flows.
A worldwide economic downturn and/or disruption of the credit markets could reduce our access to capital or significantly increase our costs of capital, which may negatively impact our financial condition, results of operations, and cash flows.
We are therefore subject to non-U.S. currency risks and non-U.S. exchange exposure. The applicable exchange rates between and among foreign currencies and the U.S. dollar have fluctuated and will continue to do so in the future.
The applicable exchange rates between and among foreign currencies and the U.S. dollar have fluctuated and will continue to do so in the future.
Exchange rates can be volatile and a substantial weakening of foreign currencies against the U.S. dollar could reduce our profit margin in certain of our businesses outside of the U.S. and adversely impact the comparability of results from period to period.
Exchange rates can be volatile and a substantial weakening of foreign currencies against the U.S. dollar could reduce our profit margin in certain of our businesses outside of the U.S. and adversely impact the comparability of results from period to period. • Operating in foreign countries and emerging markets exposes us to increased risks, including economic, political, security, and international operation risks.
Our ability to realize anticipated cost savings may be affected by a number of factors, including our ability to effectively reduce overhead, rationalize manufacturing capacity, and effectively produce products at the consolidated facilities.
However, our ability to realize long-term anticipated cost savings in connection with the Portfolio Optimization Plan may be affected by a number of factors, including our ability to effectively rationalize manufacturing capacity and overhead, as well as our ability to effectively produce products at the consolidated facilities.
We may be subject to product liability claims and product recalls, which could negatively impact our profitability and corporate image. We sell flavors, colors, and other specialty ingredients that are used in foods, beverages, pharmaceuticals, personal care, nutraceuticals, and other items for human consumption or contact. These products involve risks such as contamination or spoilage, tampering, defects, and other adulteration.
We sell flavors, colors, and other specialty ingredients that are used in foods, beverages, pharmaceuticals, personal care, nutraceuticals, and other items for human consumption or contact. These products involve risks such as contamination or spoilage, tampering, defects, and other adulteration.
Although we seek to impose confidentiality, non-solicitation, loyalty, and non-competition obligations on many employees through agreements and our Code of Conduct, these efforts may not be successful.
Additionally, many of our key personnel must have access to the Company’s trade secrets to effectively perform their job responsibilities. Although we seek to impose confidentiality, non-solicitation, loyalty, and non-competition obligations on many employees through agreements and our Code of Conduct, these efforts may not be successful.
If the larger size or greater buying power of those customers results in additional negotiating strength, the prices we are able to charge could be negatively affected and our profitability could decline.
These consolidations have often produced large, sophisticated customers with increased buying power who are more capable of resisting price increases or vertically integrating. If the larger size or greater buying power of those customers results in additional negotiating strength, the prices we are able to charge could be negatively affected and our profitability could decline.
As the demand for natural products continues to grow, the risks associated with agriculture, such as reduced crop yields, reduced crop availability, water shortages, increased water costs, reduced access to water, droughts, and other potentially more severe weather events, are becoming increasingly important. In addition, we obtain some raw materials from a single supplier or a limited number of suppliers.
As the demand for natural products continues to grow, and our business continues to evolve to meet such demand, the risks associated with agriculture, such as reduced crop yields, reduced crop availability, water shortages, increased water costs, reduced access to water, droughts, and other potentially more severe weather events, are becoming increasingly important.
In such events, we may incur losses, or our results of operations, financial condition, or liquidity could otherwise be adversely affected. • The impact of currency exchange rate fluctuation may negatively affect our results. We report the results of our foreign operations in the applicable local currency and then translate those results into U.S. dollars at applicable exchange rates.
In such events, we may incur losses, or our results of operations, financial condition, or liquidity could otherwise be adversely affected. 14 Index • The impact of currency exchange rate fluctuation may negatively affect our results.
However, governmental authorities could challenge these policies more aggressively in the future and, if challenged, we may not prevail. We could suffer significant costs related to one or more challenges to our transfer pricing policies.
However, governmental authorities could challenge these policies more aggressively in the future and, if challenged, we may not prevail.
The competition for these individuals can be significant and if we are unable to successfully integrate, motivate, and reward our employees, we may not be able to retain them. The loss of key employees or inability to attract new employees in the future could harm our business.
Our success depends in large part on the continued service and availability of our key management and technical personnel, and on our ability to attract and retain qualified new personnel. The competition for these individuals can be significant and if we are unable to successfully integrate, motivate, and reward our employees, we may not be able to retain them.
The military conflicts may also increase the risk of cybersecurity incidents, including the risk of cyberattacks in retaliation based upon the United States’ and/or European Union’s support for Ukraine or Israel. Such attacks, whether on us or on critical infrastructure and financial institutions globally, could also adversely affect our operations.
These increased costs, or any potential shortage of energy or raw materials, could adversely affect our profitability. The military conflicts may also increase the risk of cybersecurity incidents, including the risk of cyberattacks in retaliation based upon the United States’ and/or European Union’s support for Ukraine or Israel.
In addition, we need to provide for smooth transitions when replacing key management and technical personnel positions. Our operations and results may be negatively affected if we are not able to do so. Additionally, many of our key personnel must have access to the Company’s trade secrets to effectively perform their job responsibilities.
The loss of key employees or inability to attract new employees in the future could harm our business. In addition, we need to provide for smooth transitions when replacing key management and technical personnel positions. Our operations and results may be negatively affected if we are not able to do so.
It is difficult to predict the effects of current or future tariffs and other trade barriers and disputes, and the Company’s efforts to reduce the effects of tariffs through pricing and other measures may not be effective. For example, the Trump administration has expressed an intent to use tariffs, or the threat of tariffs, to further national policy goals.
It is difficult to predict the effects of current or future tariffs and other trade barriers and disputes, and the Company’s efforts to reduce the effects of tariffs through pricing and other measures may not be effective. We have generally taken pricing actions in response to the tariffs imposed by the Trump administration.
Conversely, at the end of 2022 and continuing through 2023, our financial performance was adversely impacted by customer destocking that resulted from our customers holding large quantities of inventory during the COVID-19 pandemic and then returning to normalized levels.
Additionally, if we do not maintain enough inventory to satisfy the demand of our customers, we may lose business to our competitors, which could adversely affect our results. Conversely, our financial performance in 2023 was adversely impacted by customer destocking that resulted from our customers holding large quantities of inventory during the COVID-19 pandemic and then returning to normalized levels.
S uppliers located in Ukraine are our main source of sunflower oil, which is primarily used in our savory and beverage businesses. We have encountered difficulties, and may continue to encounter difficulties, in finding favorable pricing and reliable alternative sources or substitutes for certain of the raw materials we need (including sunflower oil) for certain products.
We have encountered difficulties, and may continue to encounter difficulties, in finding favorable pricing and reliable alternative sources or substitutes for certain of the raw materials we need (including sunflower oil) for certain products. If these difficulties persist, accelerate, or expand, our operations could be adversely affected.
It is also possible for a threat to be introduced as a result of our customers and third-party providers using the output of an artificial intelligence tool or other new and evolving technologies that includes a threat, such as introducing malicious code by incorporating artificial intelligence-generated source code. 18 Index Because of the nature of our business, and the importance of our proprietary information and manufacturing facilities, we face threats and experience cybersecurity incidents and attempts from time to time, not only from hackers that are intent on theft and disruption, but also from malicious insiders that may attempt to steal Company information or negligent employees.
Because of the nature of our business, and the importance of our proprietary information and manufacturing facilities, we face threats and experience cybersecurity incidents and attempts from time to time, not only from hackers that are intent on theft and disruption, but also from malicious insiders that may attempt to steal Company information or negligent employees.
In addition, the Trump administration has expressed an interest in re-examining the use of synthetic food colorants.
Several other states also have various legislative proposals to ban or restrict the use of synthetic colors. In addition, the Trump administration has expressed an interest in re-examining the use of synthetic food colorants.
If we fail to keep up with changing regulations and preferences, or if we fail to innovate or operate in ways that maximize sustainability, our customers may choose more sustainable suppliers. Failing to quickly and cost-efficiently adapt to stakeholder ESG expectations and standards could adversely affect our business and financial condition.
If we are unable to pass on these costs, our profit could decline. If we fail to keep up with changing regulations and preferences, or if we fail to innovate or operate in ways that maximize sustainability, our customers may choose more sustainable suppliers.
Competition can reduce both our sales and the prices at which we are able to sell our products, or cause us to incur additional costs to remain competitive, which can negatively affect our results. • Our business is impacted by adverse developments in economic, political, and capital market conditions, which could negatively affect our financial performance and our ability to grow or sustain the growth of our business.
We do lose business to competitors from time to time. Competition can reduce both our sales and the prices at which we are able to sell our products or cause us to incur additional costs to remain competitive, which can negatively affect our results.
Additionally, our yields from harvests for onion were adversely impacted by both drought and flooding in 2022-23 and by plant diseases, including downy mildew in certain growing areas, in 2024, resulting in reduced availability of onion products for our Natural Ingredients business in recent prior years.
Additionally, in recent years, our yields from harvests for onion have been adversely impacted by drought, plant diseases, excessive rain, and flooding, resulting in reduced availability of onion products for our Agricultural Ingredients business over the last several years.
For example, our Natural Ingredients business incurred additional costs as a result of equipment inefficiencies in 2024, which we anticipate to be resolved in 2025; however, if these inefficiencies are not remediated properly, we may continue to incur additional costs in our business.
For example, our Agricultural Ingredients business incurred additional costs as a result of equipment inefficiencies in recent years; while we have attempted to remediate these inefficiencies, we may continue to incur additional costs in our business if such inefficiencies continue.
Furthermore, effective in 2027, the Food and Drug Administration banned the use of Red 3 in food and beverages, and California passed a ban on the use of synthetic food colorants in school lunches. Numerous other states also have various legislative proposals to ban or restrict the use of synthetic colors.
Furthermore, the Food and Drug Administration banned the use of Red 3 in food and beverages (effective in 2027), West Virginia banned the use of specified synthetic food colorants (effective January 1, 2028 but currently subject to a preliminary injunction), and numerous states banned the use of synthetic food colorants in school lunches.
For example, changes in the trade relationship between the U.S. and China may affect the availability and cost of our raw materials and products originating in China, the demand for, as well as the supply of, our products manufactured in China or containing raw materials from China, and the demand from Chinese customers for our products. 14 Index These kinds of restrictions could be adopted with little to no advanced notice, and we may not be able to effectively mitigate the adverse impacts from such measures.
These kinds of restrictions could be adopted with little to no advanced notice, and we may not be able to effectively mitigate the adverse impacts from such measures.
Structural and Organizational Risks • We depend on certain key personnel, and the loss of these persons may harm our business, including the loss of trade secrets. Our success depends in large part on the continued service and availability of our key management and technical personnel, and on our ability to attract and retain qualified new personnel.
We could suffer significant costs related to one or more challenges to our transfer pricing policies. 17 Index Structural and Organizational Risks • We depend on certain key personnel, and the loss of these persons may harm our business, including the loss of trade secrets.
Many of our customers have consolidated in recent years and we expect the combination trend to continue in many business lines. These consolidations have often produced large, sophisticated customers with increased buying power who are more capable of resisting price increases or vertically integrating.
Any duties imposed may ultimately lead to higher prices and potential supply issues, which could negatively impact our results. • Consolidation has resulted in customers with increased buying power, which can affect our profitability. Many of our customers have consolidated in recent years and we expect the combination trend to continue in many business lines.
The continued strength of the U.S. dollar could continue to adversely impact our revenue and profit in non-U.S. jurisdictions. • Operating in foreign countries and emerging markets exposes us to increased risks, including economic, political, security, and international operation risks. We operate, manufacture, and sell our products and obtain raw materials in many foreign countries and emerging markets.
We operate, manufacture, and sell our products and obtain raw materials in many foreign countries and emerging markets.
Removed
We do lose business to competitors from time to time.
Added
As we continue to develop new technologies and products to meet customer demands, we may encounter, and have encountered, that our competitors have patented or applied to patent relevant subject matter in our industry.
Removed
If these difficulties persist, accelerate, or expand, our operations could be adversely affected. It is also possible that the continuing impacts and uncertainties from the Syrian civil war could adversely impact our supply of crops from Turkey. 10 Index These increased costs, or any potential shortage of energy or raw materials, could adversely affect our profitability.
Added
These patents may negatively impact the selection of products that we can offer to our customers or otherwise increase potential risk of an infringement lawsuit if we offer a similar product.
Removed
Since the beginning of the COVID-19 pandemic, we have seen a reduction in the size of new product launches and fewer limited time offerings from some of our customers. Even after the pandemic receded, this trend has continued to a degree. Any of these actions by our customers can adversely affect our results.
Added
Any limitations on our ability to offer a full range of products may increase the likelihood that our customers would purchase from our competitors and adversely affect our profitability. • Our business is impacted by adverse developments in economic, political, and capital market conditions, which could negatively affect our financial performance and our ability to grow or sustain the growth of our business.
Removed
These types of activities have required, and may continue to require, the devotion of significant resources and management attention and may pose business risks. In addition, these actions may result in a deterioration of employee relations at the impacted locations in our business.
Added
For example, s uppliers located in Ukraine are our main source of sunflower oil, which is primarily used in our savory and beverage businesses.
Removed
Additionally, if we do not maintain enough inventory to satisfy the demand of our customers, we may lose business to our competitors, which could adversely affect our results.
Added
In addition, we source certain of our crops in Turkey, which could be adversely impacted by the continuing impacts and uncertainties from the continued fighting in Syria and potential political tensions between Turkey and the United States.
Removed
If we are unable to respond, or we are perceived to be responding inadequately, to the expectations of our stakeholders, our business and reputation could be harmed, our profit and revenue could decline, and it could have a negative impact on the trading price of our common stock.
Added
In addition, the rapid changes in and unpredictability of certain U.S. policies has caused continuing volatility in global economic and political conditions. It continues to be increasingly difficult to strategically plan internationally given such volatility.
Removed
In addition, the increased focus on ESG matters may result, and has already resulted, in regulations, laws, and demands, such as enhanced sustainability reporting regimes, which could cause us, and has already caused us, to incur additional costs or to make changes to our operations to comply with any such regulations, laws, or demands.
Added
As an international company with long-term sales and supply contracts globally, we may be adversely impacted by any decision of the administration that we were unable to anticipate, or mitigate the results of, and such impact could have an adverse effect on our financial performance and future growth.
Removed
If we are unable to pass on these costs, our profit could decline.
Added
Such attacks, whether on us or on critical infrastructure and financial institutions globally, could also adversely affect our operations. In addition, the credit markets provide us with liquidity to operate and grow our business beyond the liquidity that our cash flows provide.
Removed
Further, our customers and the markets we serve may impose standards, regulations, market-based policies, or preferences that we may not be able to timely meet due to the required level of capital investment or technological advancement, which in the case of the availability of sustainable energy to support our operations is generally outside our control.
Added
The customers to whom we sell our products incorporate our products into their own products. Our customers face intense competition .

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

6 edited+1 added−1 removed13 unchanged
Biggest changeIn these sessions, the Board receives materials and discusses such matters with our Chief Information Officer. The Board also receives annual training on cybersecurity. In addition, we have formed an executive level steering committee (including the CEO, CFO, Group Presidents, General Counsel, VP, Human Resources, Controller/Chief Accounting Officer, and Chief Information Officer) that provides oversight and routinely discusses cybersecurity matters.
Biggest changeIn addition, we have formed an executive level steering committee (including the CEO, CFO, Group Presidents, General Counsel, VP, Human Resources, Controller/Chief Accounting Officer, and Chief Information Officer) that provides oversight and routinely discusses cybersecurity matters. 20 Index Our cybersecurity risk management and strategy processes, which are discussed in greater detail above, are led by our Chief Information Officer, our Director of Information Security, and our Director of Infrastructure.
To provide for the availability of critical data and systems, maintain regulatory compliance, manage our material risks from cybersecurity threats, and to protect against, detect, and respond to cybersecurity incidents, we: • Run tabletop exercises with our executive team to simulate a response to a cybersecurity incident and use the findings to improve our processes and technologies; • Conduct regular third-party assessments of our cybersecurity program; • Undertake regular reviews of our incident response plan and other policies related to cybersecurity; • Run regular cyber penetration testing; • Through policy and practice, classify information, restrict access, and require employees to treat sensitive data with care; and • Conduct an annual employee training program, including regular phishing email simulations for all employees with access to corporate email systems to enhance awareness and responsiveness to such possible threats.
To provide for the availability of critical data and systems, maintain regulatory compliance, manage our material risks from cybersecurity threats, and protect against, detect, and respond to cybersecurity incidents, we: • Run tabletop exercises with our executive team to simulate a response to a cybersecurity incident and use the findings to improve our processes and technologies; • Conduct regular third-party assessments of our cybersecurity program; • Undertake regular reviews of our incident response plan and other policies related to cybersecurity; • Run regular cyber penetration testing; • Through policy and practice, classify information, restrict access, and require employees to treat sensitive data with care; and • Conduct an annual employee training program, including regular phishing email simulations for all employees with access to corporate email systems to enhance awareness and responsiveness to such possible threats.
Our incident response plan coordinates the activities we take to prepare for, detect, respond to, and recover from cybersecurity incidents, which include processes to triage, assess severity of, escalate, contain, investigate, and remediate the incident, as well as to comply with potentially applicable legal obligations.
Our incident response plan coordinates the activities we take to prepare for, detect, respond to, and recover from cybersecurity incidents, which include processes to triage, assess severity of, escalate, contain, investigate, and remediate the incident, as well as comply with potentially applicable legal obligations.
For more information regarding cybersecurity risks that could impact the Company, see our risk factor disclosures at Item 1A of this Annual Report on Form 10-K, which such disclosures are incorporated by reference herein. 19 Index Governance Cybersecurity is an important part of our risk management processes and an area of focus for our Board and management.
For more information regarding cybersecurity risks that could impact the Company, see our risk factor disclosures at Item 1A of this Annual Report on Form 10-K, which such disclosures are incorporated by reference herein. Governance Cybersecurity is an important part of our risk management processes and an area of focus for our Board and management.
These individuals collectively have over 88 years of prior work experience in various roles in the information security field, including managing and implementing effective information technology and cybersecurity programs, as well as relevant degrees and certifications, including a Certified Information Systems Security Professional certification.
These individuals collectively have over 90 years of prior work experience in various roles in the information security field, including managing and implementing effective information technology and cybersecurity programs, as well as relevant degrees and certifications, including a Certified Information Systems Security Professional certification.
We have implemented several cybersecurity processes to aid in our efforts to assess, identify, and manage such material risks. Our risk management program considers cybersecurity threat risks alongside other risks as part of our overall risk assessment process.
We have implemented several cybersecurity processes to aid in our efforts to assess, identify, and manage such material risks. 19 Index Our risk management program considers cybersecurity threat risks alongside other risks as part of our overall risk assessment process.
Removed
Our cybersecurity risk management and strategy processes, which are discussed in greater detail above, are led by our Chief Information Officer, our Director of Information Security, and our Director of Infrastructure.
Added
In these sessions, the Board receives materials and discusses such matters with our Chief Information Officer. The Board also receives annual training on cybersecurity.

Item 2. Properties

Properties — owned and leased real estate

4 edited+0 added−0 removed1 unchanged
Biggest changeInternational – Heverlee, Belgium; San Jose, Costa Rica*; Geesthacht, Germany; Celaya and Tlalnepantla*, Mexico; and Wales and Milton Keynes, United Kingdom. Asia Pacific Group: U.S. – None. International – Keysborough, Australia; Guangzhou, China*; Mumbai, India*; Hitachi, Japan; Auckland, New Zealand; Manila, Philippines*; and Bangkok, Thailand*. * Indicates a leased property at the location.
Biggest changeInternational – Heverlee, Belgium; San Jose, Costa Rica*; Geesthacht, Germany; Celaya and Tlalnepantla*, Mexico; and Milton Keynes, United Kingdom. Asia Pacific Group: U.S. – None. International – Keysborough, Australia; Guangzhou, China*; Mumbai, India*; Hitachi, Japan; Auckland, New Zealand; Manila, Philippines*; and Bangkok, Thailand*. * Indicates a leased property at the location. All properties are owned except as otherwise indicated above.
International – Jundiai, Brazil*; Kingston, Ontario, Canada; Saint Ouen L’Aumone, France; Geesthacht, Germany; Reggio Emilia, Italy; Lerma, Mexico; Lima, Peru*; Johannesburg, South Africa; Gebze, Turkey; and Kings Lynn, United Kingdom. Flavors & Extracts Group: U.S. – Livingston and Turlock, California; Amboy, Illinois; Harbor Beach, Michigan; Juneau, Wisconsin; and Deming, New Mexico.
International – Jundiai, Brazil*; Kingston, Ontario, Canada; Nancy, France*; Saint Ouen L’Aumone, France; Geesthacht, Germany; Reggio Emilia, Italy; Lerma, Mexico; Lima, Peru*; Johannesburg, South Africa; Gebze, Turkey; and Kings Lynn, United Kingdom. Flavors & Extracts Group: U.S. – Livingston and Turlock, California; Amboy, Illinois; Harbor Beach, Michigan; Juneau, Wisconsin; and Deming, New Mexico.
We own a part, and lease a part, of our Flavors & Extracts Group headquarters offices located in Hoffman Estates, Illinois. As of December 31, 2024, the locations of our production properties by reportable segment are as follows: Color Group: U.S. – St. Louis, Missouri.
We own a part, and lease a part, of our Flavors & Extracts Group headquarters offices located in Hoffman Estates, Illinois. As of December 31, 2025, the locations of our production properties by reportable segment are as follows: Color Group: U.S. – St. Louis, Missouri.
All properties are owned except as otherwise indicated above. All facilities are considered to be in good condition (ordinary wear and tear excepted) and suitable and adequate for the Company’s requirements. 20 Index
All facilities are considered to be in good condition (ordinary wear and tear excepted) and suitable and adequate for the Company’s requirements.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeMorris has held his present office since January 1, 2024, and previously served as General Manager, Sweet and Beverage Flavors North America (August 2017 – December 2023). • Mr. Tornehl has held his present office since July 1, 2024, and previously served as Vice President, Controller, and Chief Accounting Officer (November 2018 – June 2024). • Mr.
Biggest changeMorris has held his present office since January 1, 2026, and previously served as President, Flavors & Extracts Group (January 2024 – December 2025) and General Manager, Sweet and Beverage Flavors North America (August 2017 – December 2023). • Mr.
Manning 56 Senior Vice President, General Counsel, and Secretary Steve Morris 61 President, Flavors & Extracts Group Tobin Tornehl 51 Vice President and Chief Financial Officer Adam Vanderleest 42 Vice President, Controller, and Chief Accounting Officer The Company has employed all of the individuals named above, in substantively their current positions, for at least the past five years except as follows: • Mr.
Manning 57 Senior Vice President, General Counsel, and Secretary Steve Morris 62 President-Elect, Color Group David Plautz 51 Vice President, Investor Relations and Treasurer Greg Till 56 President, Flavors & Extracts Group Tobin Tornehl 52 Vice President and Chief Financial Officer Adam Vanderleest 43 Vice President, Controller, and Chief Accounting Officer The Company has employed all of the individuals named above, in substantively their current positions, for at least the past five years except as follows: • Mr.
Geraghty 63 President, Color Group Thierry Hoang 44 Vice President, Asia Pacific Group Amy Schmidt Jones 55 Vice President, Human Resources and Senior Counsel John J.
Geraghty 64 President, Color Group Thierry Hoang 45 Vice President, Asia Pacific Group Amy Schmidt Jones 56 Vice President, Human Resources and Senior Counsel John J.
Item 4. Mine Safety Disclosure. Not applicable. Information About Our Executive Officers The executive officers of the Company and their ages as of February 19, 2025 are as follows: Name Age Position Paul Manning 50 Chairman, President, and Chief Executive Officer Amy M. Agallar 47 Vice President, Investor Relations, Global Procurement, and Treasurer Michael C.
Item 4. Mine Safety Disclosure. Not applicable. 21 Index Information About Our Executive Officers The executive officers of the Company and their ages as of February 13, 2026 are as follows: Name Age Position Paul Manning 51 Chairman, President, and Chief Executive Officer Michael C.
Vanderleest has held his present office since July 1, 2024, and previously served as Group Controller, Color Group (April 2021 – June 2024). Mr. Paul Manning (Chairman, President, and Chief Executive Officer) and Mr. John J. Manning (Senior Vice President, General Counsel, and Secretary) are brothers. 21 Index PART II
Tornehl has held his present office since July 1, 2024, and previously served as Vice President, Controller, and Chief Accounting Officer (November 2018 – June 2024). • Mr. Vanderleest has held his present office since July 1, 2024, and previously served as Group Controller, Color Group (April 2021 – June 2024). Mr.
Added
Plautz has held his present office since June 1, 2025, and previously served as Director, Internal Audit (May 2022 – May 2025) and Assistant Corporate Controller (September 2018 – April 2022). • Mr.
Added
Till has held his present office since January 1, 2026, and previously served as General Manager, Food Colors Europe (May 2023 – December 2025) and General Manager, South Africa (December 2019 – April 2023). • Mr.
Added
Paul Manning (Chairman, President, and Chief Executive Officer) and Mr. John J. Manning (Senior Vice President, General Counsel, and Secretary) are brothers. 22 Index PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeDecember 31, 2019 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 Sensient Technologies Corporation $ 100 $ 115 $ 159 $ 118 $ 109 $ 121 S&P Midcap Specialty Chemicals Index 100 108 128 114 127 125 S&P Midcap Food Products Index 100 110 128 125 115 121 S&P 500 Index 100 118 152 125 157 197 Standard & Poor’s and S&P are registered trademarks of Standard & Poor’s Financial Services, LLC.
Biggest changeDecember 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 December 31, 2025 Sensient Technologies Corporation $ 100 $ 138 $ 103 $ 95 $ 105 $ 141 S&P Midcap Specialty Chemicals Index 100 119 106 119 116 109 S&P Midcap Food Products Index 100 117 114 105 110 96 S&P 500 Index 100 129 105 133 166 196 Standard & Poor’s and S&P are registered trademarks of Standard & Poor’s Financial Services, LLC.
On October 19, 2017, the Board of Directors authorized the repurchase of up to three million shares (2017 Authorization). As of December 31, 2024, 1,267,019 shares had been repurchased under the 2017 Authorization. There were no repurchases of shares by the Company during 2024. There is no expiration date for the 2017 Authorization.
On October 19, 2017, the Board of Directors authorized the repurchase of up to three million shares (2017 Authorization). As of December 31, 2025, 1,267,019 shares had been repurchased under the 2017 Authorization. There were no repurchases of shares by the Company during 2025. There is no expiration date for the 2017 Authorization.
The 2017 Authorization may be modified, suspended, or discontinued by the Board of Directors at any time. As of December 31, 2024, the maximum number of shares that may be purchased under publicly announced plans is 1,732,981.
The 2017 Authorization may be modified, suspended, or discontinued by the Board of Directors at any time. As of December 31, 2025, the maximum number of shares that may be purchased under publicly announced plans is 1,732,981.
The graph assumes a $100 investment made on December 31, 2019, and reinvestment of dividends. The stock performance shown on the graph is not necessarily indicative of future price performance.
The graph assumes a $100 investment made on December 31, 2020, and reinvestment of dividends. The stock performance shown on the graph is not necessarily indicative of future price performance.
Since 1962, the Company has paid, without interruption, a quarterly cash dividend. During fiscal 2024, the Company paid aggregate cash dividends of $1.64 per share to our shareholders, and the Company most recently declared a dividend of $0.41 per share payable on March 3, 2025 to shareholders of record on February 4, 2025.
Since 1962, the Company has paid, without interruption, a quarterly cash dividend. During fiscal 2025, the Company paid aggregate cash dividends of $1.64 per share to our shareholders, and the Company most recently declared a dividend of $0.41 per share payable on March 2, 2026 to shareholders of record on February 3, 2026.
Item 5. Market for the Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities. The Company’s common stock is listed on the New York Stock Exchange under the ticker symbol “SXT.” The number of shareholders of record of the Company’s common stock on February 13, 2025 was 1,837.
Item 5. Market for the Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities. The Company’s common stock is listed on the New York Stock Exchange under the ticker symbol “SXT.” The number of shareholders of record of the Company’s common stock on February 9, 2026 was 1,746.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeTwelve Months Ended December 31, 2024 Total Foreign Exchange Rates Adjustments (1) Adjusted Local Currency Revenue Flavors & Extracts 7.1 % 0.0 % N/A 7.1 % Color 6.6 % (0.7 %) N/A 7.3 % Asia Pacific 11.2 % (1.8 %) N/A 13.0 % Total Revenue 6.9 % (0.5 %) N/A 7.4 % Operating Income Flavors & Extracts 10.6 % (0.2 %) 0.0 % 10.8 % Color 13.4 % (0.8 %) 0.0 % 14.2 % Asia Pacific 11.9 % (2.2 %) 0.0 % 14.1 % Corporate & Other (13.7 %) 0.0 % (42.4 %) 28.7 % Total Operating Income 23.6 % (1.0 %) 15.3 % 9.3 % Diluted Earnings per Share 33.0 % (1.4 %) 28.5 % 5.9 % Adjusted EBITDA 7.6 % (0.7 %) N/A 8.3 % (1) Adjustments consist of Portfolio Optimization Plan costs.
Biggest changeTwelve Months Ended December 31, 2025 Total Foreign Exchange Rates Adjustments (1) Adjusted Local Currency Revenue Flavors & Extracts (0.9%) 0.4% N/A (1.3%) Color 8.1% 0.7% N/A 7.4% Asia Pacific 3.5% 1.1% N/A 2.4% Total Revenue 3.5% 0.6% N/A 2.9% Operating Income Flavors & Extracts 3.8% 0.4% 0.0% 3.4% Color 18.2% 1.3% 0.0% 16.9% Asia Pacific 6.3% 2.5% 0.0% 3.8% Corporate & Other 20.2% 0.0% 14.8% 5.4% Total Operating Income 8.1% 1.4% (4.4%) 11.1% Diluted Earnings per Share 7.5% 1.4% (8.6%) 14.7% Adjusted EBITDA 10.9% 1.1% N/A 9.8% (1) Adjustments consist of Portfolio Optimization Plan costs.
Changes in estimates of future cash flows caused by items such as unforeseen events or changes in market conditions could negatively affect the reporting units’ fair value and result in an impairment charge. 27 Index Income Taxes The Company estimates its income tax expense in each of the taxing jurisdictions in which it operates.
Changes in estimates of future cash flows caused by items such as unforeseen events or changes in market conditions could negatively affect the reporting units’ fair value and result in an impairment charge. Income Taxes The Company estimates its income tax expense in each of the taxing jurisdictions in which it operates.
Goodwill Valuation The Company reviews the carrying value of goodwill annually utilizing several valuation methodologies, including a discounted cash flow model. The Company completed its annual goodwill impairment test under Accounting Standards Codification (ASC) 350, Intangibles – Goodwill and Other , in the third quarter of 2024.
Goodwill Valuation The Company reviews the carrying value of goodwill annually utilizing several valuation methodologies, including a discounted cash flow model. The Company completed its annual goodwill impairment test under Accounting Standards Codification (ASC) 350, Intangibles – Goodwill and Other , in the third quarter of 2025.
Note: Refer to table above for a reconciliation of these non-GAAP measures. 25 Index SEGMENT INFORMATION The Company determines its operating segments based on information utilized by its chief operating decision maker to allocate resources and assess performance.
Note: Refer to table above for a reconciliation of these non-GAAP measures. 26 Index SEGMENT INFORMATION The Company determines its operating segments based on information utilized by its chief operating decision maker to allocate resources and assess performance.
The non-cash charges in 2024 were primarily related to trial production runs that did not meet quality specifications and thus were disposed of, and the non-cash charges in 2023 reduced the carrying value of certain inventories, as they were determined to be excess.
The non-cash charges in 2025 reduced the carrying value of certain inventories, as they were determined to be excess, and the non-cash charges in 2024 were primarily related to trial production runs that did not meet quality specifications and thus were disposed.
Portfolio Optimization Plan costs are discussed under “Portfolio Optimization Plan” above and Note 15, Portfolio Optimization Plan, in the Notes to the Consolidated Financial Statements included in this report. Note: Earnings per share calculations may not foot due to rounding differences .
Portfolio Optimization Plan costs are discussed under “Portfolio Optimization Plan” above and Note 14, Portfolio Optimization Plan, in the Notes to the Consolidated Financial Statements included in this report. Note: Earnings per share calculations may not foot due to rounding differences .
The effective tax rates in both 2024 and 2023 were impacted by the release of valuation allowances related to net operating losses, changes in estimates associated with the finalization of prior year foreign and domestic tax items, audit settlements, the mix of foreign earnings, and the limited tax deductibility of costs related to the Portfolio Optimization Plan.
The effective tax rates in both 2025 and 2024 were impacted by the release of valuation allowances related to net operating losses (NOLs), changes in estimates associated with the finalization of prior year foreign and domestic tax items, audit settlements, the mix of foreign earnings, and the limited tax deductibility of costs related to the Portfolio Optimization Plan.
For a discussion of the year ended December 31, 2023, compared to the year ended December 31, 2022, please refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the Securities and Exchange Commission on February 22, 2024, which is incorporated herein by reference.
For a discussion of the year ended December 31, 2024, compared to the year ended December 31, 2023, please refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the Securities and Exchange Commission on February 19, 2025, which is incorporated herein by reference.
See Note 11, Income Taxes , in the Notes to Consolidated Financial Statements included in this report for additional information. 2024 2023 Rate before Portfolio Optimization Plan and discrete items 25.2 % 25.5 % Portfolio Optimization Plan impact 0.3 % 4.7 % Discrete items (2.1 %) (2.1 %) Reported effective tax rate 23.4 % 28.1 % The 2025 effective income tax rate is estimated to be between 24% and 26%.
See Note 11, Income Taxes , in the Notes to Consolidated Financial Statements included in this report for additional information. 2025 2024 Rate before Portfolio Optimization Plan and discrete items 26.2 % 25.2 % Portfolio Optimization Plan impact 1.2 % 0.3 % Discrete items (3.1 %) (2.1 %) Reported effective tax rate 24.3 % 23.4 % The 2026 effective income tax rate is estimated to be between 24% and 25%.
This section generally discusses the results of our operations for the year ended December 31, 2024, compared to the year ended December 31, 2023.
This section generally discusses the results of our operations for the year ended December 31, 2025, compared to the year ended December 31, 2024.
Inventory write-downs are recorded as the difference between the cost of inventory and its estimated market value. The Company recorded non-cash charges of $0.7 million and $3.1 million in 2024 and 2023, respectively, in Cost of Products Sold related to the Portfolio Optimization Plan.
Inventory write-downs are recorded as the difference between the cost of inventory and its estimated market value. The Company recorded non-cash charges of $4.3 million and $0.7 million in 2025 and 2024, respectively, in Cost of Products Sold related to the Portfolio Optimization Plan.
The following table summarizes the percentage change in the 2024 results compared to the 2023 results in the respective financial measures.
The following table summarizes the percentage change in the 2025 results compared to the 2024 results in the respective financial measures.
The decrease in net cash provided by operating activities in 2024 was primarily due to a decrease in the cash provided by accounts receivable, partially offset by a decrease in cash used for performance-based compensation payments (which are determined based on prior year performance) made during 2024 compared to 2023.
The decrease in net cash provided by operating activities in 2025 was primarily due to an increase in cash used by inventory and an increase in cash used for performance-based compensation payments (which are determined based on prior year performance) made during 2025 compared to 2024, partially offset by an increase in cash provided by accounts receivable.
Adjusted diluted earnings per share, which exclude the Portfolio Optimization Plan costs, were $3.00 in 2024 and $2.86 in 2023 (see discussion below regarding non-GAAP financial measures). Additional information on the results is included below. RESULTS OF OPERATIONS 2024 vs. 2023 Revenue Sensient’s revenue was approximately $1.6 billion and $1.5 billion in 2024 and 2023, respectively.
Adjusted diluted earnings per share, which exclude the Portfolio Optimization Plan costs, were $3.48 in 2025 and $3.00 in 2024 (see discussion below regarding non-GAAP financial measures). Additional information on the results is included below. RESULTS OF OPERATIONS 2025 vs. 2024 Revenue Sensient’s revenue was approximately $1.61 billion and $1.56 billion in 2025 and 2024, respectively.
Management has recorded valuation allowances to reduce the Company’s deferred tax assets to the amount that is more likely than not to be realized. As of December 31, 2024, the Company recorded gross deferred tax assets of $112.3 million with an associated valuation allowance of $29.7 million.
Management has recorded valuation allowances to reduce the Company’s deferred tax assets to the amount that is more likely than not to be realized. As of December 31, 2025, the Company recorded gross deferred tax assets of $133.9 million with an associated valuation allowance of $29.1 million.
In October 2017, the Board of Directors authorized the repurchase of up to three million shares. As of December 31, 2024, 1,732,981 shares were available to be repurchased under the existing authorization. The Company’s share repurchase program has no expiration date. These authorizations may be modified, suspended, or discontinued by the Board of Directors at any time.
As of December 31, 2025, 1,732,981 shares were available to be repurchased under the existing authorization. The Company’s share repurchase program has no expiration date. These authorizations may be modified, suspended, or discontinued by the Board of Directors at any time. There were no shares of Company stock repurchased in 2025 or 2024.
Flavors & Extracts segment operating income was $97.1 million in 2024 and $87.8 million in 2023, an increase of approximately 11%. Foreign exchange rates had an immaterial impact on segment operating income. The higher segment operating income was a result of higher operating income in Flavors, Extracts & Flavor Ingredients, partially offset by lower operating income in Natural Ingredients.
Flavors & Extracts segment operating income was $100.7 million in 2025 and $97.1 million in 2024, an increase of approximately 4%. Foreign exchange rates had an immaterial impact on segment operating income. The higher segment operating income was a result of higher operating income in Flavors, Extracts & Flavor Ingredients, partially offset by lower operating income in Agricultural Ingredients.
In conducting its annual test for impairment, the Company performed a qualitative assessment of its previously calculated fair values for each of its reporting units. Fair value is estimated using both a discounted cash flow analysis and an analysis of comparable company market values. If the fair value of a reporting unit exceeds its net book value, no impairment exists.
In conducting its annual test for impairment, the Company performed a quantitative assessment of the fair values for each of its reporting units and compared each of these values to the net book value of each reporting unit. Fair value is estimated using both a discounted cash flow analysis and an analysis of comparable company market values.
The Company’s three reporting units each had goodwill recorded and were tested for impairment. All three reporting units had fair values that were above their respective net book values by at least 75%.
If the fair value of a reporting unit exceeds its net book value, no impairment exists. The Company’s three reporting units each had goodwill recorded and were tested for impairment. All three reporting units had fair values that were above their respective net book values by at least 75%.
The Company’s diluted earnings per share were $2.94 in 2024 and $2.21 in 2023. 2024 results were negatively impacted by $6.6 million ($2.5 million after tax, $0.06 per share) of Portfolio Optimization Plan costs. 2023 results were negatively impacted by $27.8 million ($27.4 million after tax, $0.65 per share) of Portfolio Optimization Plan costs.
The Company’s diluted earnings per share were $3.16 in 2025 and $2.94 in 2024. 2025 results were negatively impacted by $15.8 million ($13.8 million after tax, $0.32 per share) of Portfolio Optimization Plan costs. 2024 results were negatively impacted by $6.6 million ($2.5 million after tax, $0.06 per share) of Portfolio Optimization Plan costs.
LIQUIDITY AND FINANCIAL POSITION Financial Condition The Company’s financial position remains strong. The Company is in compliance with its loan covenants calculated in accordance with applicable agreements as of December 31, 2024.
See the Portfolio Optimization Plan section above for further information. LIQUIDITY AND FINANCIAL POSITION Financial Condition The Company’s financial position remains strong. The Company is in compliance with its loan covenants calculated in accordance with applicable agreements as of December 31, 2025.
The Company’s estimate of liabilities and related insurance recoveries may change as further facts and circumstances become known.
The Company recognizes related insurance reimbursement when receipt is deemed probable. The Company’s estimate of liabilities and related insurance recoveries may change as further facts and circumstances become known.
The higher operating income in Flavors, Extracts & Flavor Ingredients was primarily due to lower raw material costs, higher selling prices, higher volumes, and a favorable product mix. The lower operating income in Natural Ingredients was primarily due to higher raw material costs, partially offset by higher volumes and selling prices.
The higher operating income in Flavors, Extracts & Flavor Ingredients was primarily due to higher selling prices and volumes, partially offset by higher manufacturing and other costs.
The higher operating income in Personal Care was primarily due to higher volumes and selling prices and a favorable product mix. The higher operating income in Food & Pharmaceutical Colors was primarily due to higher volumes and selling prices and a favorable product mix, partially offset by higher raw material and manufacturing and other costs.
The higher operating income in Food & Pharmaceutical Colors was due to higher selling prices and volumes, a favorable product mix, and the favorable impact of foreign exchange rates, which increased segment operating income by approximately 1%, partially offset by higher raw material and manufacturing and other costs.
These non-GAAP measures may not be comparable to similarly titled measures used by other companies. 24 Index Twelve Months Ended December 31, (In thousands except per share amounts) 2024 2023 % Change Operating Income (GAAP) $ 191,579 $ 155,023 23.6 % Portfolio Optimization Plan costs – Cost of products sold 1,362 3,135 Portfolio Optimization Plan costs – Selling and administrative expenses 5,269 24,706 Adjusted operating income $ 198,210 $ 182,864 8.4 % Net Earnings (GAAP) $ 124,666 $ 93,394 33.5 % Portfolio Optimization Plan costs, before tax 6,631 27,841 Tax impact of Portfolio Optimization Plan costs (1) (4,156 ) (415 ) Adjusted net earnings $ 127,141 $ 120,820 5.2 % Diluted Earnings Per Share (GAAP) $ 2.94 $ 2.21 33.0 % Portfolio Optimization Plan costs, net of tax 0.06 0.65 Adjusted diluted earnings per share $ 3.00 $ 2.86 4.9 % Operating Income (GAAP) $ 191,579 $ 155,023 23.6 % Depreciation and amortization 60,329 57,820 Share-based compensation expense 10,084 8,933 Portfolio Optimization Plan costs, before tax 6,631 27,841 Adjusted EBITDA $ 268,623 $ 249,617 7.6 % (1) Tax impact adjustments were determined based on the nature of the underlying non-GAAP adjustments and their relevant jurisdictional tax rates.
These non-GAAP measures may not be comparable to similarly titled measures used by other companies. 25 Index Twelve Months Ended December 31, (In thousands except per share amounts) 2025 2024 % Change Operating Income (GAAP) $ 207,128 $ 191,579 8.1 % Portfolio Optimization Plan costs – Cost of products sold 7,531 1,362 Portfolio Optimization Plan costs – Selling and administrative expenses 8,275 5,269 Adjusted operating income $ 222,934 $ 198,210 12.5 % Net Earnings (GAAP) $ 134,489 $ 124,666 7.9 % Portfolio Optimization Plan costs, before tax 15,806 6,631 Tax impact of Portfolio Optimization Plan costs (1) (2,001 ) (4,156 ) Adjusted net earnings $ 148,294 $ 127,141 16.6 % Diluted Earnings Per Share (GAAP) $ 3.16 $ 2.94 7.5 % Portfolio Optimization Plan costs, net of tax 0.32 0.06 Adjusted diluted earnings per share $ 3.48 $ 3.00 16.0 % Operating Income (GAAP) $ 207,128 $ 191,579 8.1 % Depreciation and amortization 61,098 60,329 Share-based compensation expense 13,946 10,084 Portfolio Optimization Plan costs, before tax 15,806 6,631 Adjusted EBITDA $ 297,978 $ 268,623 10.9 % (1) Tax impact adjustments were determined based on the nature of the underlying non-GAAP adjustments and their relevant jurisdictional tax rates.
Segment performance is evaluated on operating income before any applicable share-based compensation, acquisition, restructuring and other costs, including the Portfolio Optimization Plan costs, and other costs (which are reported in Corporate & Other), interest expense, and income taxes.
Segment performance is evaluated on operating income before share-based compensation (except for share-based compensation expense associated with stock grants to certain business unit leaders) , restructuring and other costs, including the Portfolio Optimization Plan costs, and other costs (which are reported in Corporate & Other), interest expense, and income taxes.
There were no shares of Company stock repurchased in 2024 or 2023. Cash Flows from Operating Activities Net cash provided by operating activities was $157.2 million and $169.7 million in 2024 and 2023, respectively. Operating cash flow provided the primary source of funds for operating needs, capital expenditures, and shareholder dividends.
Cash Flows from Operating Activities Net cash provided by operating activities was $127.8 million and $157.2 million in 2025 and 2024, respectively. Operating cash flow provided the primary source of funds for operating needs, capital expenditures, and shareholder dividends.
Cash Flows from Investing Activities Net cash used in investing activities was $59.2 million and $87.6 million in 2024 and 2023, respectively. Capital expenditures were $59.2 million in 2024 and $87.9 million in 2023.
Cash Flows from Investing Activities Net cash used in investing activities was $92.7 million and $59.2 million in 2025 and 2024, respectively. Capital expenditures were $89.4 million in 2025 and $59.2 million in 2024 .
The Company’s corporate expenses, share-based compensation, restructuring and other charges, including the Portfolio Optimization Plan costs, and other costs are included in the “Corporate & Other” category.
The Company’s corporate expenses, share-based compensation (except for share-based compensation expense associated with stock grants to certain business unit leaders) , restructuring and other charges, including the Portfolio Optimization Plan costs, and other costs are included in the “Corporate & Other” category.
The Company had a net decrease in debt of $7.8 million and $3.5 million in 2024 and 2023, respectively. For the purposes of the cash flow statement, net changes in debt exclude the impact of foreign exchange rates. The Company has paid uninterrupted quarterly cash dividends since commencing public trading of its stock in 1962.
For the purposes of the cash flow statement, net changes in debt exclude the impact of foreign exchange rates. The Company has paid uninterrupted quarterly cash dividends since commencing public trading of its stock in 1962. Dividends paid per share were $1.64 in 2025 and 2024. Total dividends paid were $69.6 million and $69.4 million in 2025 and 2024, respectively.
The Company believes that it has the ability to refinance or repay all of its obligations through a combination of cash flow from operations, issuance of additional notes, and substantial borrowing capacity of approximately $257 million under the Company’s revolving credit facility, which matures in 2026. 26 Index As a result of our ability to manage the impact of inflation through pricing and other actions, the impact of inflation was not material to the Company’s financial position and its results of operations in 2024.
The Company believes that it has the ability to refinance or repay all of its obligations through a combination of cash flow from operations, issuance of additional notes, and substantial borrowing capacity of approximately $261 million under the Company’s revolving credit facility, which matures in 2030.
The increase in segment operating income was a result of higher volumes and selling prices, partially offset by higher raw material and manufacturing and other costs and the unfavorable impact of foreign exchange rates, which decreased segment operating income by approximately 2%. Segment operating income as a percent of revenue was 21.2% in 2024 and 21.1% in 2023.
The increase in segment operating income was a result of higher selling prices, a favorable product mix, and the favorable impact of foreign exchange rates, which increased segment operating income by approximately 3%, partially offset by higher raw material and manufacturing and other costs.
Portfolio Optimization Plan During the fourth quarter of 2023, the Board of Directors of the Company approved a plan to undertake an effort to optimize certain production facilities and improve efficiencies within the Company (Portfolio Optimization Plan).
See Note 2, Acquisition , in the Notes to Consolidated Financial Statements included in this report for additional information. Portfolio Optimization Plan During the fourth quarter of 2023, the Board of Directors of the Company approved a plan to undertake an effort to optimize certain production facilities and improve efficiencies within the Company (Portfolio Optimization Plan).
Selling and administrative expenses in 2024 and 2023 were increased by Portfolio Optimization Plan costs totaling $5.3 million and $24.7 million, respectively. Selling and administrative expense as a percent of revenue increased by approximately 40 basis points and 170 basis points in 2024 and 2023, respectively, as a result of these costs. See Portfolio Optimization Plan below for further information.
Selling and administrative expense as a percent of revenue increased by approximately 50 basis points and 40 basis points in 2025 and 2024, respectively, as a result of these costs. See Portfolio Optimization Plan below for further information. Operating Income Operating income was $207.1 million in 2025 and $191.6 million in 2024.
Segment operating income as a percent of revenue was 12.2% and 11.8% for 2024 and 2023, respectively. Color Segment revenue for the Color segment was $647.9 million in 2024 and $608.0 million in 2023, an increase of approximately 7%.
Segment operating income as a percent of revenue was 12.8% and 12.2% for 2025 and 2024, respectively. Color Color segment revenue was $700.6 million in 2025 and $647.9 million in 2024, an increase of approximately 8%. The higher segment revenue was a result of higher revenue in Food & Pharmaceutical Colors and Personal Care.
Asia Pacific Segment revenue for the Asia Pacific segment was $162.5 million and $146.1 million for 2024 and 2023, respectively, an increase of approximately 11%. Segment revenue was higher than the prior year primarily due to higher volumes and selling prices, partially offset by the unfavorable impact of foreign exchange rates, which decreased segment revenue by approximately 2%.
Segment revenue was higher than the prior year primarily due to higher selling prices and the favorable impact of foreign exchange rates, which increased segment revenue by approximately 1%, partially offset by lower volumes largely driven by tariff-related impacts. Asia Pacific segment operating income was $36.6 million in 2025 and $34.5 million in 2024, an increase of approximately 6%.
While significant judgment is involved in determining the net realizable value of certain inventories with shorter expirations, the Company believes that inventory is appropriately stated at the lower of cost or net realizable value.
While significant judgment is involved in determining the net realizable value of certain inventories with shorter expirations, the Company believes that inventory is appropriately stated at the lower of cost or net realizable value. 29 Index Commitments and Contingencies The Company is subject to litigation and other legal proceedings arising in the ordinary course of its businesses or arising under applicable laws and regulations.
Flavors & Extracts Flavors & Extracts segment revenue was $793.7 million in 2024 and $741.1 million in 2023, an increase of approximately 7%. The higher segment revenue was a result of higher revenue in Natural Ingredients and Flavors, Extracts & Flavor Ingredients due to higher volumes and selling prices. Foreign exchange rates had an immaterial impact on segment revenue.
The lower revenue in Agricultural Ingredients was due to lower volumes, partially offset by higher selling prices. The higher revenue in Flavors, Extracts & Flavor Ingredients was primarily due to higher selling prices and volumes. Foreign exchange rates had an immaterial impact on segment revenue.
Gross Profit The Company’s gross margin was 32.6% in 2024 and 31.6% in 2023. The increase in gross margin was primarily due to higher volumes and selling prices, partially offset by higher raw material costs. Selling and Administrative Expenses Selling and administrative expense as a percent of revenue was 20.3% in 2024 and 21.0% in 2023.
Gross Profit The Company’s gross margin was 33.5% in 2025 and 32.6% in 2024. The increase in gross margin was primarily due to higher selling prices and volumes, partially offset by higher raw material costs and higher Portfolio Optimization Plan costs.
When it is probable that the Company has incurred a liability associated with claims or pending or threatened litigation matters and the Company’s exposure is reasonably estimable, the Company records a charge against earnings. The Company recognizes related insurance reimbursement when receipt is deemed probable.
Estimating liabilities and costs associated with these matters requires the judgment of management, who rely in part on information from Company legal counsel. When it is probable that the Company has incurred a liability associated with claims or pending or threatened litigation matters and the Company’s exposure is reasonably estimable, the Company records a charge against earnings.
See Note 15, Portfolio Optimization Plan , in the Notes to Consolidated Financial Statements included in this report for additional information.
The Company has substantially completed all other actions contemplated under the Portfolio Optimization Plan in accordance with local laws. See Note 14, Portfolio Optimization Plan , in the Notes to Consolidated Financial Statements included in this report for additional information.
The higher segment revenue was a result of higher revenue in Food & Pharmaceutical Colors and Personal Care due to higher volumes and selling prices, partially offset by the unfavorable impact of foreign exchange rates, which decreased segment revenue by approximately 1% .
The higher revenue in Food & Pharmaceutical Colors was primarily due to higher volumes and selling prices. The higher revenue in Personal Care was primarily due to higher selling prices and the acquisition of Biolie SAS , partially offset by lower volumes.
The increase in expense was primarily due to an increase in the average interest rate. 23 Index Income Taxes The effective income tax rate was 23.4% in 2024 and 28.1% in 2023.
Additional information on segment results can be found in the Segment Information section. Interest Expense Interest expense was $29.6 million in 2025 and $28.8 million in 2024. The increase in expense was primarily due to an increase in the average outstanding debt balance. 24 Index Income Taxes The effective income tax rate was 24.3% in 2025 and 23.4% in 2024.
Corporate & Other The Corporate & Other operating loss was $59.5 million in 2024 and $68.9 million in 2023. The lower operating loss was primarily a result of lower Portfolio Optimization Plan costs, partially offset by higher performance-based compensation costs in 2024. See the Portfolio Optimization Plan section above for further information.
Segment operating income as a percent of revenue was 21.8% in 2025 and 21.2% in 2024. 27 Index Corporate & Other The Corporate & Other operating loss was $71.5 million in 2025 and $59.5 million in 2024. The higher operating loss was primarily a result of higher Portfolio Optimization Plan costs and higher performance-based compensation costs in 2025.
Segment operating income for the Color segment was $119.5 million in 2024 and $105.4 million in 2023, an increase of approximately 13%. The higher segment operating income was a result of higher operating income in Personal Care and Food & Pharmaceutical Colors.
The higher segment operating income was a result of higher operating income in Food & Pharmaceutical Colors, partially offset by lower operating income in Personal Care.
Segment operating income for the Asia Pacific segment was $34.5 million in 2024 and $30.8 million in 2023, an increase of approximately 12%.
Asia Pacific Asia Pacific segment revenue was $168.2 million and $162.5 million for 2025 and 2024, respectively, an increase of approximately 4%.
The Company’s contractual obligations consist primarily of operational commitments, which we expect to continue to be able to satisfy through cash generated from operations, and debt. The Company has various series of notes outstanding that mature from 2025 through 2029, with approximately $56 million coming due in 2025.
However, the Company anticipates to increase its existing debt capacity over the coming years to further support the increased cash requirements for operations and capital expenditures associated with the natural colors conversion activity. The Company’s contractual obligations consist primarily of operational commitments, which we expect to continue to be able to satisfy through cash generated from operations, and debt.
These increases were partially offset by the unfavorable impact of foreign exchange rates, which decreased segment operating income by approximately 1%. Segment operating income as a percent of revenue was 18.4% and 17.3% for 2024 and 2023, respectively.
Segment revenue was further increased by the favorable impact of foreign exchange rates, which increased segment revenue by a pproximately 1% . Color segment operating income was $141.3 million in 2025 and $119.5 million in 2024, an increase of approximately 18%.
The Company has experienced increased costs for certain inputs, such as raw materials, shipping and logistics, and labor-related costs. We continue to expect to manage these impacts in the near term, but persistent, accelerated, or expanded inflationary conditions could exacerbate these challenges and impact our profitability.
We continue to expect to manage these impacts in the near term, but persistent, accelerated, or expanded inflationary conditions could exacerbate these challenges and impact our profitability. The United States implemented significant tariffs on imports from a wide range of countries in 2025 and has announced the possibility of implementing additional, or increasing current, tariffs in 2026.
Selling and administrative expenses as a percent of revenue was further impacted by higher performance-based compensation costs in 2024. Operating Income Operating income was $191.6 million in 2024 and $155.0 million in 2023. Operating margins were 12.3% in 2024 and 10.6% in 2023.
Selling and Administrative Expenses Selling and administrative expense as a percent of revenue was 20.6% in 2025 and 20.3% in 2024. Selling and administrative expenses in 2025 and 2024 were increased by Portfolio Optimization Plan costs totaling $8.3 million and $5.3 million, respectively.
The Company paid $1.7 million in 2023 related to a purchase price holdback associated with the acquisition of Endemix Doğal Maddeler A.Ş. and Teknoloji Yatırımları ve Danışmanlık Sanayi ve Ticaret A.Ş. Cash Flows from Financing Activities Net cash used in financing activities was $81.5 million and $82.0 million in 2024 and 2023, respectively.
In 2025, the Company paid $4.9 million for the acquisition of Biolie SAS . 28 Index Cash Flows from Financing Activities Net cash used in financing activities was $35.0 million and $81.5 million in 2025 and 2024, respectively.
Portfolio Optimization Plan costs decreased operating margins by approximately 40 basis points and 200 basis points in 2024 and 2023, respectively. Additional information on segment results can be found in the Segment Information section. Interest Expense Interest expense was $28.8 million in 2024 and $25.2 million in 2023.
Operating margins were 12.8% in 2025 and 12.3% in 2024. Portfolio Optimization Plan costs decreased operating margins by approximately 100 basis points and 40 basis points in 2025 and 2024, respectively. Operating margins were positively impacted by the higher selling prices and volumes, partially offset by higher raw material costs.
Removed
The effective tax rate in 2023 was further impacted by the release of a valuation allowance related to the foreign tax credit carryover.
Added
Gross profit in 2025 and 2024 was negatively impacted by Portfolio Optimization Plan costs totaling $7.5 million and $1.4 million, respectively, which decreased gross margin by approximately 40 basis points and 10 basis points in 2025 and 2024, respectively. See Portfolio Optimization Plan below for further information.
Removed
T he Company’s Felinfach site will continue to operate until all production activities have successfully transferred to other locations, and then will be closed. The Company has substantially completed all other actions contemplated under the Portfolio Optimization Plan in accordance with local laws.
Added
The effective tax rate in 2025 was also impacted by the change in the German tax rate.
Removed
Dividends paid per share were $1.64 in 2024 and 2023. Total dividends paid were $69.4 million and $69.2 million in 2024 and 2023, respectively.
Added
Acquisition On February 14, 2025, the Company acquired Biolie SAS, a natural color extraction business located in France. The Company paid $4.9 million in cash for this acquisition, which is net of $0.2 million in debt assumed. This business is part of the Color segment.
Removed
Commitments and Contingencies The Company is subject to litigation and other legal proceedings arising in the ordinary course of its businesses or arising under applicable laws and regulations. Estimating liabilities and costs associated with these matters requires the judgment of management, who rely in part on information from Company legal counsel.
Added
The Company’s Felinfach site was shut down in May 2025, and all production activities have been transferred to other locations. The Company began marketing the Felinfach site for sale in June 2025.
Added
As a result, the Company met all of the assets held for sale criteria for the Felinfach land and building assets in June 2025, which have been recorded as the only balance in Fixed assets held for sale on the Company’s Consolidated Balance Sheets.
Added
Flavors & Extracts Flavors & Extracts segment revenue was $786.9 million in 2025 and $793.7 million in 2024, a decrease of approximately 1%. The lower segment revenue was a result of lower revenue in Agricultural Ingredients, partially offset by higher revenue in Flavors, Extracts & Flavor Ingredients.
Added
The lower operating income in Agricultural Ingredients was due to higher raw material costs, lower volumes, a one-time charge stemming from the impact of atmospheric river events late in the year that disrupted the harvest and production, and higher manufacturing and other costs, partially offset by higher selling prices.
Added
The lower operating income in Personal Care was primarily due to higher raw material and manufacturing and other costs, partially offset by higher selling prices. Segment operating income as a percent of revenue was 20.2% and 18.4% for 2025 and 2024, respectively.
Added
The Company has various series of notes outstanding that mature from 2026 through 2029, with approximately $35 million coming due in 2026.
Added
As a result of our ability to manage the impact of inflation through pricing and other actions, the impact of inflation was not material to the Company’s financial position and its results of operations in 2025. The Company has experienced increased costs for certain inputs, such as raw materials, shipping and logistics, and labor-related costs.
Added
These actions, and retaliatory tariffs imposed by other countries on United States exports, have led to significant volatility and uncertainty in global markets. The Company anticipates incurring incremental tariff costs on certain raw materials to produce our products and certain finished goods shipped to customers.
Added
However, the Company expects to manage the impact of the increased tariff costs through pricing actions. To the extent the Company is unable to offset the increased tariff costs, or the tariffs negatively impact demand, or other trade barriers are implemented, the Company’s revenue and profitability would be adversely impacted.
Added
If additional tariffs are adopted, the Company would incur additional tariff costs that could be material. On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the United States.
Added
The OBBBA includes a broad range of tax reform provisions, such as the extension of certain expiring provisions, modifications to the international tax framework, and the continuation of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027.
Added
These provisions did not have a material impact on our effective tax rate for the year ended December 31, 2025. We will continue to assess the OBBBA tax provisions and their impacts on our consolidated financial statements. In October 2017, the Board of Directors authorized the repurchase of up to three million shares.
Added
The Company had a net increase in debt of $38.9 million and a net decrease in debt of $7.8 million in 2025 and 2024, respectively. The cash proceeds from the increase in net debt in 2025 were primarily used to support capital expenditure investments related to natural color conversion efforts during the year.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

8 edited+0 added−0 removed6 unchanged
Biggest changeNote 1 and Note 7 to the Consolidated Financial Statements include discussions of the Company’s accounting policies for financial instruments. 28 Index Because the Company manufactures and sells its products throughout the world, it is exposed to movements in foreign currency exchange rates. The major foreign currency exposures include the markets in Western Europe, Latin America, Canada, and Asia.
Biggest changeBecause the Company manufactures and sells its products throughout the world, it is exposed to movements in foreign currency exchange rates. The major foreign currency exposures include the markets in Western Europe, Latin America, Canada, and Asia.
However, any change in the value of the contracts, real or hypothetical, would be significantly offset by a corresponding change in the value of the underlying hedged items. In addition, this hypothetical calculation assumes that each exchange rate would change in the same direction relative to the U.S. dollar. The Company has certain debt denominated in Euros and British Pounds.
However, any change in the value of the contracts, real or hypothetical, would be significantly offset by a corresponding change in the value of the underlying hedged items. In addition, this hypothetical calculation assumes that each exchange rate would change in the same direction relative to the U.S. dollar. The Company has certain debt denominated in Euros.
On occasion, the Company may enter into non-cancelable forward purchase contracts, as deemed appropriate, to reduce the effect of price fluctuations on future manufacturing requirements. 29 Index
On occasion, the Company may enter into non-cancelable forward purchase contracts, as deemed appropriate, to reduce the effect of price fluctuations on future manufacturing requirements. 30 Index
At December 31, 2024, the potential increase or decrease in annual interest expense of floating rate debt, assuming a hypothetical 10% fluctuation in interest rates, would be $1.0 million. The Company is the purchaser of certain commodities, such as vanilla, corn, sugar, soybean meal, and fruits.
At December 31, 2025, the potential increase or decrease in annual interest expense of floating rate debt, assuming a hypothetical 10% fluctuation in interest rates, would be $0.9 million. The Company is the purchaser of certain commodities, such as vanilla, corn, sugar, soybean meal, and fruits.
These non-derivative debt instruments act as partial hedges of the Company’s Euro and British Pound net asset positions. The potential increase or decrease in the annual U.S. dollar equivalent interest expense of the Company’s outstanding foreign currency-denominated debt, assuming a hypothetical 10% fluctuation in the currencies of such debt, would be approximately $1.1 million at December 31, 2024.
These non-derivative debt instruments act as partial hedges of the Company’s Euro net asset positions. The potential increase or decrease in the annual U.S. dollar equivalent interest expense of the Company’s outstanding foreign currency-denominated debt, assuming a hypothetical 10% fluctuation in the currencies of such debt, would be approximately $1.0 million at December 31, 2025.
The net fair value of these instruments, based on dealer quotes, was a liability of $0.8 million and an asset of $1.0 million as of December 31, 2024 and 2023 , respectively.
The net fair value of these instruments, based on dealer quotes, was an asset of $0.3 million and a liability of $0.8 million as of December 31, 2025 and 2024 , respectively.
At December 31, 2024, the potential gain or loss in the fair value of the Company’s outstanding foreign exchange contracts, assuming a hypothetical 10% fluctuation in the currencies of such contracts, would be approximately $2.1 million.
At December 31, 2025, the potential gain or loss in the fair value of the Company’s outstanding foreign exchange contracts, assuming a hypothetical 10% fluctuation in the currencies of such contracts, would be approximately $3.3 million.
The financial impacts of these hedging instruments are offset by corresponding changes in the underlying exposures being hedged. The Company does not hold or issue derivative financial instruments for trading purposes.
The financial impacts of these hedging instruments are offset by corresponding changes in the underlying exposures being hedged. The Company does not hold or issue derivative financial instruments for trading purposes. Note 1 and Note 7 to the Consolidated Financial Statements include discussions of the Company’s accounting policies for financial instruments.

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