18 Apr Sensient reduces debt, must pay settlement
Milwaukee — Sensient Technologies Corp. (NYSE:SXT) reported $12.8 million in profits on $251.9 million in revenues for its first quarter ended March 31. Diluted earnings per share were 27 cents. Sensient is a global manufacturer and marketer of colors, flavors and fragrances.
Revenue was down $3 million since the same quarter last year. Total debt was $596 million, a reduction of $19.2 million.
Results for the first quarter include a one-time expense of $4.5 million related to an arbitration with a customer expected to be finished in May. Arbitrators determined that all Sensient products performed as specified but enforced a previously disputed settlement proposal. The company will make a one-time payment in exchange for multi-year contract extensions totaling about $80 million.
“We are satisfied with the conclusion of the recent arbitration,” said Kenneth Manning, Chairman, President and CEO of Sensient. “Although the settlement requires a one-time expense, the multi-year contracts we will receive in return are the longest in the company’s history.”
Sensient now expects 2005 diluted earnings per share to be between $1.57 and $1.60. This revised guidance reflects the one-time settlement expense of 6 cents incurred this quarter.