Sensient Technologies Corporation — Third Quarter 2026 Earnings Summary

Financial Performance:

• Reported revenue increased 10.6% to $455.8 million in the third quarter of 2026, compared to $412.1 million in the prior year; local currency revenue increased 10.2%.
• Reported operating income rose 25.5% to $72.4 million, up from $57.7 million in the prior year quarter; local currency adjusted operating income increased 18.6%.
• Reported diluted earnings per share (EPS) increased 29.9% to $1.13, compared to $0.87 in the prior year; local currency adjusted diluted EPS increased 17.7%.
• For the nine months ended September 30, 2026, reported revenue was $1,353.8 million (up 11.1% from $1,218.7 million), operating income was $215.9 million (up 27.8% from $168.9 million), and diluted EPS was $3.37 (up 31.6% from $2.56).
• Adjusted EBITDA for the quarter was $93.1 million, a 15.6% increase from $80.5 million in the prior year; local currency adjusted EBITDA increased 15.4%.
• Net cash provided by operating activities for the nine months ended September 30, 2026, was $75.3 million, down from $83.3 million in the prior year period.
• Net debt as of September 30, 2026, was $765.5 million, compared to $684.0 million in the prior year period; the Net Debt to Credit Adjusted EBITDA ratio remained at 2.3x.
• Dividends paid per share for the nine months ended September 30, 2026, were $1.23, unchanged from the prior year.

Guidance and Future Outlook:

• The Company maintained its 2026 guidance for local currency revenue growth at high single-digit to low double-digit.
• The Company maintained its 2026 guidance for local currency adjusted EBITDA growth at mid-teen to high teen.
• The Company maintained its 2026 guidance for diluted EPS (GAAP) between $4.15 and $4.20, raising the lower bound from the prior guidance of $4.10.
• The Company maintained its 2026 guidance for local currency adjusted diluted EPS growth at mid-teen to high teen.
• Management indicated that foreign currency impact is expected to be immaterial for the remainder of the year based on current exchange rates.

Business Segments and Product Lines:

• The Flavors & Extracts Group reported revenue of $210.0 million (up 3.5%); growth was driven by higher prices and volume. Segment operating income was $30.5 million (up 8.8%).
• The Color Group reported revenue of $210.3 million (up 18.1%); growth was driven by strong volume. Segment operating income was $46.1 million (up 22.0%).
• The Asia Pacific Group reported revenue of $47.3 million (up 12.4%); growth was driven by strong volume and higher prices. Segment operating income was $12.4 million (up 29.6%).
• Corporate & Other operating expenses were $16.5 million in the third quarter of 2026, down from $17.6 million in the prior year; local currency adjusted operating expenses increased $2.2 million due to higher performance-based compensation costs.

Market and Competitive Landscape:

• The Company operates as a leading provider of flavors and colors for the food, pharmaceutical, and personal care markets.
• The Color segment demonstrated the highest revenue growth among segments at 18.1% in the third quarter.
• The Asia Pacific segment showed the highest operating income growth at 29.6% in the third quarter.

Risks and Challenges:

• Forward-looking statements are subject to risks including general business, economic, and capital market conditions, recessions, and economic downturns.
• Risks include macroeconomic and geopolitical volatility, inflation, raw material shortages, supply chain disruptions, and conflicts in Russia/Ukraine and the Middle East.
• Potential impacts from tariffs, trade barriers, currency exchange rate fluctuations, and labor/logistics costs are noted.
• Risks include the ability to implement growth strategies, successfully introduce new products, and respond to changing consumer preferences and regulations.
• The outcome of productivity-improvement efforts, cost-reduction efforts, and the Portfolio Optimization Plan is subject to uncertainty.

Management Commentary and Tone:

• Paul Manning, Chairman, President, and CEO, described the third quarter as "exceptional," citing the strength of the company's strategy and focus on customers.
• Management expressed confidence in the momentum across the business and opportunities in the markets.
• The CEO stated he remains "very confident" about performance in 2026 and beyond.

Other Key Points:

• The Company recorded $3.3 million in costs related to its Portfolio Optimization Plan in the third quarter of 2025, with no such costs recorded in the third quarter of 2026.
• The Company hosted a conference call on October 30, 2026, to discuss results, with a replay available through November 6, 2026.
• Cash and cash equivalents increased to $42.6 million as of September 30, 2026, from $36.5 million as of December 31, 2025.
• Inventories increased to $791.1 million as of September 30, 2026, from $678.2 million as of December 31, 2025.
• Long-term debt increased to $790.1 million as of September 30, 2026, from $709.2 million as of December 31, 2025.
• The Company utilizes non-GAAP financial measures to eliminate the impact of currency movements, depreciation, amortization, Portfolio Optimization Plan costs, and non-cash share-based compensation.