Sensient Technologies (SXT) 10-Q 6 May 19 2019 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	Apr. 30, 2019
Document and Entity Information [Abstract]
Entity Registrant Name	SENSIENT TECHNOLOGIES CORP
Entity Central Index Key	0000310142
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Ex Transition Period	false
Entity Common Stock, Shares Outstanding		42,319,163
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1

CONSOLIDATED CONDENSED STATEMEN

CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS (Unaudited) [Abstract]
Revenue	$ 347,513	$ 356,477
Cost of products sold	232,288	233,406
Selling and administrative expenses	65,805	67,390
Operating income	49,420	55,681
Interest expense	5,402	5,555
Earnings before income taxes	44,018	50,126
Income taxes	11,211	11,932
Net earnings	$ 32,807	$ 38,194
Weighted average number of shares outstanding:
Basic (in shares)	42,239	42,879
Diluted (in shares)	42,275	43,034
Earnings per common share:
Basic (in dollars per share)	$ 0.78	$ 0.89
Diluted (in dollars per share)	0.78	0.89
Dividends declared per common share (in dollars per share)	$ 0.36	$ 0.33

CONSOLIDATED CONDENSED STATEM_2

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) [Abstract]
Comprehensive Income	$ 32,091	$ 62,058

CONSOLIDATED CONDENSED BALANCE

CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
CURRENT ASSETS:
Cash and cash equivalents	$ 33,896	$ 31,901
Trade accounts receivable, net	273,800	255,350
Inventories	468,324	490,757
Prepaid expenses and other current assets	50,276	44,857
TOTAL CURRENT ASSETS	826,296	822,865
OTHER ASSETS	87,891	66,788
DEFERRED TAX ASSETS	8,653	9,189
INTANGIBLE ASSETS, NET	18,295	18,867
GOODWILL	413,710	416,175
PROPERTY, PLANT AND EQUIPMENT:
Land	36,467	36,787
Buildings	319,242	318,463
Machinery and equipment	695,811	688,003
Construction in progress	32,973	34,772
Property, plant and equipment, gross	1,084,493	1,078,025
Less accumulated depreciation	(598,467)	(586,969)
Property, plant and equipment, net	486,026	491,056
TOTAL ASSETS	1,840,871	1,824,940
CURRENT LIABILITIES:
Trade accounts payable	108,381	131,812
Accrued salaries, wages and withholdings from employees	20,255	23,410
Other accrued expense	38,703	31,198
Income taxes	10,031	8,234
Short-term borrowings	20,082	20,046
TOTAL CURRENT LIABILITIES	197,452	214,700
DEFERRED TAX LIABILITIES	31,097	28,976
OTHER LIABILITIES	21,845	8,554
ACCRUED EMPLOYEE AND RETIREE BENEFITS	23,801	23,210
LONG-TERM DEBT	688,952	689,553
SHAREHOLDERS' EQUITY:
Common stock	5,396	5,396
Additional paid-in capital	100,485	101,663
Earnings reinvested in the business	1,533,832	1,516,243
Treasury stock, at cost	(595,718)	(597,800)
Accumulated other comprehensive loss	(166,271)	(165,555)
TOTAL SHAREHOLDERS' EQUITY	877,724	859,947
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 1,840,871	$ 1,824,940

CONSOLIDATED CONDENSED STATEM_3

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Cash flows from operating activities:
Net earnings	$ 32,807	$ 38,194
Adjustments to arrive at net cash provided by (used in) operating activities:
Depreciation and amortization	13,672	12,578
Share-based compensation	687	1,254
Net (gain) loss on assets	(41)	70
Deferred income taxes	2,674	(4,346)
Changes in operating assets and liabilities	(26,375)	(66,441)
Net cash provided by (used in) operating activities	23,424	(18,691)
Cash flows from investing activities:
Acquisition of property, plant and equipment	(8,300)	(11,058)
Cash receipts on sold receivables	0	44,406
Proceeds from sale of assets	45	45
Acquisition of new businesses	0	(11,000)
Other investing activity	(301)	789
Net cash (used in) provided by investing activities	(8,556)	23,182
Cash flows from financing activities:
Proceeds from additional borrowings	16,689	92,348
Debt payments	(12,577)	(12,280)
Purchase of treasury stock	0	(72,704)
Dividends paid	(15,218)	(14,274)
Other financing activity	(803)	(2,715)
Net cash used in financing activities	(11,909)	(9,625)
Effect of exchange rate changes on cash and cash equivalents	(964)	6,210
Net increase in cash and cash equivalents	1,995	1,076
Cash and cash equivalents at beginning of period	31,901	29,344
Cash and cash equivalents at end of period	$ 33,896	$ 30,420

CONSOLIDATED STATEMENTS OF SHAR

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Common Stock [Member]	Additional Paid-In Capital [Member]	Earnings Reinvested in the Business [Member]	Treasury Stock [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Total
Beginning balance at Dec. 31, 2017	$ 5,396	$ 107,176	$ 1,414,485	$ (525,422)	$ (149,334)
Beginning balance (in shares) at Dec. 31, 2017				10,759,291
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	0	0	38,194	$ 0	0	$ 38,194
Other comprehensive income (loss)	0	0	0	0	23,864
Cash dividends paid	0	0	(14,274)	0	0
Share-based compensation	0	1,254	0	0	0
Stock options exercised	0	(38)	0	$ 98	0
Stock options exercised (in shares)				(2,000)
Non-vested stock issued upon vesting	0	(4,842)	0	$ 4,842	0
Non-vested stock issued upon vesting (in shares)				(99,152)
Benefit plans	0	350	0	$ 769	0
Benefit plans (in shares)				(15,126)
Purchase of treasury stock	0	0	0	$ (72,704)	0
Purchase of treasury stock (in shares)				1,000,000
Other	0	(801)	418	$ (1,975)	0
Other (in shares)				40,430
Ending balance at Mar. 31, 2018	5,396	103,099	1,438,823	$ (594,392)	(125,470)
Ending balance (in shares) at Mar. 31, 2018				11,683,443
Beginning balance at Dec. 31, 2018	5,396	101,663	1,516,243	$ (597,800)	(165,555)	859,947
Beginning balance (in shares) at Dec. 31, 2018				11,731,223
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	0	0	32,807	$ 0	0	32,807
Other comprehensive income (loss)	0	0	0	0	(716)
Cash dividends paid	0	0	(15,218)	0	0
Share-based compensation	0	687	0	0	0
Non-vested stock issued upon vesting	0	(1,784)	0	$ 1,784	0
Non-vested stock issued upon vesting (in shares)				(35,016)
Benefit plans	0	72	0	$ 948	0
Benefit plans (in shares)				(18,597)
Other	0	(153)	0	$ (650)	0
Other (in shares)				12,769
Ending balance at Mar. 31, 2019	$ 5,396	$ 100,485	$ 1,533,832	$ (595,718)	$ (166,271)	$ 877,724
Ending balance (in shares) at Mar. 31, 2019				11,690,379

CONSOLIDATED STATEMENTS OF SH_2

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) [Abstract]
Cash dividends per share (in dollars per share)	$ 0.36	$ 0.33

Accounting Policies

Accounting Policies	3 Months Ended
	Mar. 31, 2019
Accounting Policies [Abstract]
Accounting Policies	1. Accounting Policies In the opinion of Sensient Technologies Corporation (the “Company”), the accompanying unaudited consolidated condensed financial statements contain all adjustments (consisting of only normal recurring adjustments) that are necessary to present fairly the financial position of the Company as of March 31, 2019, and the results of operations, comprehensive income, cash flows, and shareholders’ equity for the three months ended March 31, 2019 and 2018. The results of operations for any interim period are not necessarily indicative of the results to be expected for the full year. The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Expenses are charged to operations in the period incurred. Please refer to the notes in the Company’s annual consolidated financial statements for the year ended December 31, 2018, for additional details of the Company’s financial condition and a description of the Company’s accounting policies, which have been continued without change except for the Company’s Lease and Derivative Financial Instruments accounting policies. These policies have been updated as a result of the Company’s adoption of Accounting Standards Update (ASU) 2016-02 , Leases (Topic 842) and ASU No. 2017-12, Targeted Improvements to Accounting for Hedging Activities , Leases The Company enters into lease agreements for certain office space, warehouses, land, and equipment in the ordinary course of business. The Company determines if an arrangement is a lease at inception and evaluates the lease classification (i.e., operating lease or financing lease) at that time. Lease arrangements with an initial term of 12 months or less are considered short-term leases and are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the term of the lease. Operating leases are included in Other Assets Other Accrued Expenses Other Liabilities The Company uses its incremental borrowing rate on the commencement date for determining the present value of lease payments. The Company considers the likelihood of exercising options to extend or terminate the lease when determining the lease term. The Company has lease agreements with lease and non-lease components. The Company has elected the practical expedient to account for the lease and non-lease components as a single lease component for all leases. Derivative Financial Instruments The Company selectively uses derivative financial instruments to reduce market risk associated with changes in foreign currency and interest rate exposures that exist as part of ongoing business operations. All derivative transactions are authorized and executed pursuant to the Company’s risk management policies and procedures, which strictly prohibit the use of financial instruments for speculative trading purposes. The primary objectives of the foreign exchange risk management activities are to understand and mitigate the impact of potential foreign exchange fluctuations on the Company’s financial results and its economic well-being. Changes in the fair value of derivatives that are designated as fair value hedges, along with the gain or loss on the hedged item, are recorded in current period earnings. Generally, these risk management transactions involve the use of foreign currency derivatives to protect against exposure resulting from recorded accounts receivable and payable. The Company may utilize forward exchange contracts, generally with maturities of less than 18 months, that qualify as cash flow hedges. Generally, these foreign exchange contracts are intended to offset the effect of exchange rate fluctuations on non-functional currency denominated sales and purchases. For derivative instruments that are designated as cash flow hedges, gains and losses , Hedge effectiveness is determined by how closely the changes in the fair value of the hedging instrument offset the changes in the fair value or cash flows of the hedged item. Hedge accounting is permitted only if the hedging relationship is expected to be highly effective at the inception of the transaction and on an ongoing basis. Recently Adopted Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued ASU No. 2016-02, Leases (Topic 842) , Leases (Topic 842) Targeted Improvements The Company elected the following practical expedients permitted within the standard: 1. The Company will not re-assess an expired or existing contract to determine if it is a lease or contains a lease. 2. The Company will not re-assess the lease classification for an existing lease based on the new standard’s lease classification criteria. 3. The Company will not re-assess the accounting treatment for initial direct costs on existing leases based on the new standard’s guidance. 4. The Company will account for the lease and non-lease components as a single lease component for all leases. The adoption of this standard resulted in the recognition of $20.7 million in right-of-use assets and lease liabilities for operating leases as of January 1, 2019. The adoption of this standard did not have an impact on the Company’s Consolidated Statements of Earnings, or to cash provided by or used in operating, financing, or investing activities on the Company’s Consolidated Condensed Statements of Cash Flows. In August 2017, the FASB issued ASU No. 2017-12, Targeted Improvements to Accounting for Hedging Activities - The Company adopted ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments , in the first quarter of 2018 using monthly cash receipts as its unit of account. In the second quarter of 2018, the Company updated its unit of account to daily cash receipts for the cash received related to the beneficial interest in the previously transferred receivables. As a result, the reported results as of June 30, 2018, included an adjustment of $35.4 million for collections on beneficial interest in previously transferred receivables and an adjustment of $1.6 million for company owned life insurance proceeds for the three months ended March 31, 2018, which were previously reported as cash flows from operating activities. The Consolidated Condensed Statement of Cash Flows for the three months ended March 31, 2018 have been updated to reflect these adjustments. Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses of Financial Instruments In January 2017, the FASB issued ASU 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In August 2018, the FASB issued ASU 2018-13 , Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement Please refer to the notes in the Company’s annual consolidated financial statements for the year ended December 31, 2018, for additional details of the Company’s financial condition and a description of the Company’s accounting policies, which have been continued without change, except as discussed above.

Acquisitions

Acquisitions	3 Months Ended
	Mar. 31, 2019
Acquisitions [Abstract]
Acquisitions	2. Acquisitions On March 9, 2018, the Company completed the acquisition of certain net assets and the natural color business of GlobeNatural, On July 10, 2018, the Company completed the acquisition of Mazza Innovation Limited

Fair Value

Fair Value	3 Months Ended
	Mar. 31, 2019
Fair Value [Abstract]
Fair Value	3. Fair Value Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures

Segment Information

Segment Information	3 Months Ended
	Mar. 31, 2019
Segment Information [Abstract]
Segment Information	4. Segment Information Operating results by segment for the periods presented are as follows: (In thousands) Flavors & Fragrances Color Asia Pacific Corporate & Other Consolidated Three months ended March 31, 2019: Revenue from external customers $ 178,744 $ 140,250 $ 28,519 $ - $ 347,513 Intersegment revenue 4,809 3,629 - - 8,438 Total revenue $ 183,553 $ 143,879 $ 28,519 $ - $ 355,951 Operating income (loss) $ 23,125 $ 30,199 $ 4,218 $ (8,122 ) $ 49,420 Interest expense - - - 5,402 5,402 Earnings (loss) before income taxes $ 23,125 $ 30,199 $ 4,218 $ (13,524 ) $ 44,018 Three months ended March 31, 2018: Revenue from external customers $ 182,482 $ 143,728 $ 30,267 $ - $ 356,477 Intersegment revenue 5,864 3,432 - - 9,296 Total revenue $ 188,346 $ 147,160 $ 30,267 $ - $ 365,773 Operating income (loss) $ 25,327 $ 33,672 $ 4,872 $ (8,190 ) $ 55,681 Interest expense - - - 5,555 5,555 Earnings (loss) before income taxes $ 25,327 $ 33,672 $ 4,872 $ (13,745 ) $ 50,126 The Company evaluates performance based on operating income of the respective segments before restructuring and other costs, interest expense, and income taxes. There were no restructuring and other costs incurred in either the first quarter of 2019 or 2018. In July 2018, the Company completed the acquisition of Mazza Innovation Limited Acquisitions In addition to evaluating the Company’s performance based on the segments above, revenue is also disaggregated and analyzed by product line and geographic market. The following table displays the Company’s revenue by these major sources. Product Lines (In thousands) Flavors & Fragrances Color Asia Pacific Consolidated Three months ended March 31, 2019: Flavors $ 104,276 $ - $ - $ 104,276 Natural Ingredients 51,219 - - 51,219 Fragrances 28,058 - - 28,058 Food & Beverage Colors - 80,364 - 80,364 Cosmetics - 38,283 - 38,283 Other Colors - 25,232 - 25,232 Asia Pacific - - 28,519 28,519 Intersegment Revenue (4,809 ) (3,629 ) - (8,438 ) Total revenue from external customers $ 178,744 $ 140,250 $ 28,519 $ 347,513 (In thousands) Flavors & Fragrances Color Asia Pacific Consolidated Three months ended March 31, 2018: Flavors $ 109,051 $ - $ - $ 109,051 Natural Ingredients 53,201 - - 53,201 Fragrances 26,094 - - 26,094 Food & Beverage Colors - 76,816 - 76,816 Cosmetics - 45,504 - 45,504 Other Colors - 24,840 - 24,840 Asia Pacific - - 30,267 30,267 Intersegment Revenue (5,864 ) (3,432 ) - (9,296 ) Total revenue from external customers $ 182,482 $ 143,728 $ 30,267 $ 356,477 Geographic Markets (In thousands) Flavors & Fragrances Color Asia Pacific Consolidated Three months ended March 31, 2019: North America $ 112,747 $ 66,007 $ 25 $ 178,779 Europe 48,001 42,135 41 90,177 Asia Pacific 7,609 16,425 28,266 52,300 Other 10,387 15,683 187 26,257 Total revenue from external customers $ 178,744 $ 140,250 $ 28,519 $ 347,513 Three months ended March 31, 2018: North America $ 119,055 $ 63,582 $ - $ 182,637 Europe 45,427 43,631 6 89,064 Asia Pacific 7,022 16,910 30,011 53,943 Other 10,978 19,605 250 30,833 Total revenue from external customers $ 182,482 $ 143,728 $ 30,267 $ 356,477

Inventories

Inventories	3 Months Ended
	Mar. 31, 2019
Inventories [Abstract]
Inventories	5. Inventories At March 31, 2019, and December 31, 2018, inventories included finished and in-process products totaling $310.6 million and $320.4 million, respectively, and raw materials and supplies of $157.7 million and $170.4 million, respectively.

Retirement Plans

Retirement Plans	3 Months Ended
	Mar. 31, 2019
Retirement Plans [Abstract]
Retirement Plans	6. Retirement Plans The Company’s components of annual benefit cost for the defined benefit plans for the periods presented are as follows: Three Months Ended March 31, (In thousands) 2019 2018 Service cost $ 359 $ 368 Interest cost 320 289 Expected return on plan assets (231 ) (245 ) Recognized actuarial gain (39 ) (27 ) Total defined benefit expense $ 409 $ 385 The Company’s non-service cost portion of defined benefit expense is recorded in Interest Expense on the Company’s Consolidated Condensed Statements of Earnings. The Company’s service cost portion of defined benefit expense is recorded in Selling and Administrative Expenses on the Company’s Consolidated Condensed Statements of Earnings.

Leases

Leases	3 Months Ended
	Mar. 31, 2019
Leases [Abstract]
Leases	7. Leases The Company leases certain office space, warehouses, land, and equipment under operating lease arrangements. Some of the Company’s leases include options to extend the leases for up to an additional five years. Some of the Company’s lease agreements also include rental payments that are adjusted periodically for inflation (i.e., CPI index). The Company recorded operating lease expense, which includes short-term lease expense and variable lease costs, of $3.0 million for the three months ended March 31, 2019. For the three months ended March 31, 2019, the Company paid $2.5 million in cash for operating leases, not including short-term lease expense or variable lease costs. The Company entered into operating leases that resulted in $2.4 million of right-of-use assets in exchange for operating lease obligations for the three months ended March 31, 2019. The Company included $20.8 million of right-of-use assets in Other Assets Other Accrued Expenses Other Liabilities The Company’s weighted average remaining operating lease term was 3.7 years as of March 31, 2019. The Company’s weighted average discount rate for operating leases was 3.8% as of March 31, 2019. As of March 31, 2019, maturities of operating lease liabilities for future annual periods are as follows: (in thousands) Year ending December 31, 2019 $ 6,537 2020 6,998 2021 3,715 2022 1,800 2023 1,044 Thereafter 2,330 Total lease payments 22,424 Less imputed interest (1,651 ) Present value of lease liabilities $ 20,773

Derivative Instruments and Hedg

Derivative Instruments and Hedging Activity	3 Months Ended
	Mar. 31, 2019
Derivative Instruments and Hedging Activity [Abstract]
Derivative Instruments and Hedging Activity	8. Derivative Instruments and Hedging Activity The Company may use forward exchange contracts and foreign currency denominated debt to manage its exposure to foreign exchange risk in order to reduce the effect of fluctuating foreign currencies on short-term foreign currency denominated intercompany transactions, non-functional currency raw material purchases, non-functional currency sales, and other known foreign currency exposures. These forward exchange contracts generally have maturities of less than 18 months. The Company’s primary hedging activities and their accounting treatment are summarized below. Forward exchange contracts Net investment hedges

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2019
Income Taxes [Abstract]
Income Taxes	9. Income Taxes The effective income tax rates for the three months ended March 31, 2019 and 2018, were 25.5% and 23.8%, respectively. The effective tax rates in both 2019 and 2018 were impacted by changes in estimates associated with the finalization of prior year foreign and domestic tax items, audit settlements, and the mix of foreign earnings.

Accumulated Other Comprehensive

Accumulated Other Comprehensive Income	3 Months Ended
	Mar. 31, 2019
Accumulated Other Comprehensive Income [Abstract]
Accumulated Other Comprehensive Income	10. Accumulated Other Comprehensive Income The following table summarizes the changes in OCI during the three-month periods ended March 31, 2019 and 2018: (In thousands) Cash Flow Hedges (a) Pension Items (a) Foreign Currency Items Total Balance as of December 31, 2017 $ (669 ) $ (309 ) $ (148,356 ) $ (149,334 ) Other comprehensive income before reclassifications 670 - 23,186 23,856 Amounts reclassified from OCI 38 (30 ) - 8 Balance as of March 31, 2018 $ 39 $ (339 ) $ (125,170 ) $ (125,470 ) (In thousands) Cash Flow Hedges (a) Pension Items (a) Foreign Currency Items Total Balance as of December 31, 2018 $ 147 $ 549 $ (166,251 ) $ (165,555 ) Other comprehensive income before reclassifications 597 - (1,164 ) (567 ) Amounts reclassified from OCI (112 ) (37 ) - (149 ) Balance as of March 31, 2019 $ 632 $ 512 $ (167,415 ) $ (166,271 ) (a) Cash Flow Hedges and Pension Items are net of tax.

Accounts Receivable Securitizat

Accounts Receivable Securitization	3 Months Ended
	Mar. 31, 2019
Accounts Receivable Securitization [Abstract]
Accounts Receivable Securitization	11. Accounts Receivable Securitization The Company is engaged in an accounts receivable securitization program with Wells Fargo & Company (Wells Fargo). The commitment size under the program is $70 million. Between October 2016 and June 2018, the Company accounted for sales of trade receivables under the program as a reduction of accounts receivable in the Consolidated Condensed Balance Sheets in accordance with ASC Topic 860, Transfers and Servicing In June 2018, the Company amended the program. Following the amendment, the Company no longer accounts for the sales of the trade receivables in accordance with ASC Topic 860, and instead now maintains the trade receivables and related debt on its Consolidated Condensed Balance Sheets. Under the amended program, Wells Fargo has extended a secured loan of up to $70 million to the Company secured by Wells Fargo’s undivided interests in certain of the Company’s trade accounts receivables. The program expires in October 2019; however, the Company has the intent and ability to refinance or extend the program prior to maturity. As of March 31, 2019, $70 million was borrowed under the program.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2019
Commitments and Contingencies [Abstract]
Commitments and Contingencies	12. Commitments and Contingencies The Company is subject to various claims and litigation arising in the normal course of business. The Company establishes reserves for claims and proceedings when it is probable that liabilities exist and reasonable estimates of loss can be made. While it is not possible to predict the outcome of these matters, based on our assessment of the facts and circumstances now known, we do not believe that these matters, individually or in the aggregate, will have a material adverse effect on our financial position. However, actual outcomes may be different from those expected and could have a material effect on our results of operations or cash flows in a particular period.

Accounting Policies (Policies)

Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2019
Accounting Policies [Abstract]
Leases	Leases The Company enters into lease agreements for certain office space, warehouses, land, and equipment in the ordinary course of business. The Company determines if an arrangement is a lease at inception and evaluates the lease classification (i.e., operating lease or financing lease) at that time. Lease arrangements with an initial term of 12 months or less are considered short-term leases and are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the term of the lease. Operating leases are included in Other Assets Other Accrued Expenses Other Liabilities The Company uses its incremental borrowing rate on the commencement date for determining the present value of lease payments. The Company considers the likelihood of exercising options to extend or terminate the lease when determining the lease term. The Company has lease agreements with lease and non-lease components. The Company has elected the practical expedient to account for the lease and non-lease components as a single lease component for all leases.
Derivative Financial Instruments	Derivative Financial Instruments The Company selectively uses derivative financial instruments to reduce market risk associated with changes in foreign currency and interest rate exposures that exist as part of ongoing business operations. All derivative transactions are authorized and executed pursuant to the Company’s risk management policies and procedures, which strictly prohibit the use of financial instruments for speculative trading purposes. The primary objectives of the foreign exchange risk management activities are to understand and mitigate the impact of potential foreign exchange fluctuations on the Company’s financial results and its economic well-being. Changes in the fair value of derivatives that are designated as fair value hedges, along with the gain or loss on the hedged item, are recorded in current period earnings. Generally, these risk management transactions involve the use of foreign currency derivatives to protect against exposure resulting from recorded accounts receivable and payable. The Company may utilize forward exchange contracts, generally with maturities of less than 18 months, that qualify as cash flow hedges. Generally, these foreign exchange contracts are intended to offset the effect of exchange rate fluctuations on non-functional currency denominated sales and purchases. For derivative instruments that are designated as cash flow hedges, gains and losses , Hedge effectiveness is determined by how closely the changes in the fair value of the hedging instrument offset the changes in the fair value or cash flows of the hedged item. Hedge accounting is permitted only if the hedging relationship is expected to be highly effective at the inception of the transaction and on an ongoing basis.
Recently Adopted/Issued Accounting Pronouncements	Recently Adopted Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued ASU No. 2016-02, Leases (Topic 842) , Leases (Topic 842) Targeted Improvements The Company elected the following practical expedients permitted within the standard: 1. The Company will not re-assess an expired or existing contract to determine if it is a lease or contains a lease. 2. The Company will not re-assess the lease classification for an existing lease based on the new standard’s lease classification criteria. 3. The Company will not re-assess the accounting treatment for initial direct costs on existing leases based on the new standard’s guidance. 4. The Company will account for the lease and non-lease components as a single lease component for all leases. The adoption of this standard resulted in the recognition of $20.7 million in right-of-use assets and lease liabilities for operating leases as of January 1, 2019. The adoption of this standard did not have an impact on the Company’s Consolidated Statements of Earnings, or to cash provided by or used in operating, financing, or investing activities on the Company’s Consolidated Condensed Statements of Cash Flows. In August 2017, the FASB issued ASU No. 2017-12, Targeted Improvements to Accounting for Hedging Activities - The Company adopted ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments , in the first quarter of 2018 using monthly cash receipts as its unit of account. In the second quarter of 2018, the Company updated its unit of account to daily cash receipts for the cash received related to the beneficial interest in the previously transferred receivables. As a result, the reported results as of June 30, 2018, included an adjustment of $35.4 million for collections on beneficial interest in previously transferred receivables and an adjustment of $1.6 million for company owned life insurance proceeds for the three months ended March 31, 2018, which were previously reported as cash flows from operating activities. The Consolidated Condensed Statement of Cash Flows for the three months ended March 31, 2018 have been updated to reflect these adjustments. Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses of Financial Instruments In January 2017, the FASB issued ASU 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In August 2018, the FASB issued ASU 2018-13 , Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement Please refer to the notes in the Company’s annual consolidated financial statements for the year ended December 31, 2018, for additional details of the Company’s financial condition and a description of the Company’s accounting policies, which have been continued without change, except as discussed above.

Segment Information (Tables)

Segment Information (Tables)	3 Months Ended
	Mar. 31, 2019
Segment Information [Abstract]
Segment Information	Operating results by segment for the periods presented are as follows: (In thousands) Flavors & Fragrances Color Asia Pacific Corporate & Other Consolidated Three months ended March 31, 2019: Revenue from external customers $ 178,744 $ 140,250 $ 28,519 $ - $ 347,513 Intersegment revenue 4,809 3,629 - - 8,438 Total revenue $ 183,553 $ 143,879 $ 28,519 $ - $ 355,951 Operating income (loss) $ 23,125 $ 30,199 $ 4,218 $ (8,122 ) $ 49,420 Interest expense - - - 5,402 5,402 Earnings (loss) before income taxes $ 23,125 $ 30,199 $ 4,218 $ (13,524 ) $ 44,018 Three months ended March 31, 2018: Revenue from external customers $ 182,482 $ 143,728 $ 30,267 $ - $ 356,477 Intersegment revenue 5,864 3,432 - - 9,296 Total revenue $ 188,346 $ 147,160 $ 30,267 $ - $ 365,773 Operating income (loss) $ 25,327 $ 33,672 $ 4,872 $ (8,190 ) $ 55,681 Interest expense - - - 5,555 5,555 Earnings (loss) before income taxes $ 25,327 $ 33,672 $ 4,872 $ (13,745 ) $ 50,126
Product Information	Product Lines (In thousands) Flavors & Fragrances Color Asia Pacific Consolidated Three months ended March 31, 2019: Flavors $ 104,276 $ - $ - $ 104,276 Natural Ingredients 51,219 - - 51,219 Fragrances 28,058 - - 28,058 Food & Beverage Colors - 80,364 - 80,364 Cosmetics - 38,283 - 38,283 Other Colors - 25,232 - 25,232 Asia Pacific - - 28,519 28,519 Intersegment Revenue (4,809 ) (3,629 ) - (8,438 ) Total revenue from external customers $ 178,744 $ 140,250 $ 28,519 $ 347,513 (In thousands) Flavors & Fragrances Color Asia Pacific Consolidated Three months ended March 31, 2018: Flavors $ 109,051 $ - $ - $ 109,051 Natural Ingredients 53,201 - - 53,201 Fragrances 26,094 - - 26,094 Food & Beverage Colors - 76,816 - 76,816 Cosmetics - 45,504 - 45,504 Other Colors - 24,840 - 24,840 Asia Pacific - - 30,267 30,267 Intersegment Revenue (5,864 ) (3,432 ) - (9,296 ) Total revenue from external customers $ 182,482 $ 143,728 $ 30,267 $ 356,477
Geographical Information	Geographic Markets (In thousands) Flavors & Fragrances Color Asia Pacific Consolidated Three months ended March 31, 2019: North America $ 112,747 $ 66,007 $ 25 $ 178,779 Europe 48,001 42,135 41 90,177 Asia Pacific 7,609 16,425 28,266 52,300 Other 10,387 15,683 187 26,257 Total revenue from external customers $ 178,744 $ 140,250 $ 28,519 $ 347,513 Three months ended March 31, 2018: North America $ 119,055 $ 63,582 $ - $ 182,637 Europe 45,427 43,631 6 89,064 Asia Pacific 7,022 16,910 30,011 53,943 Other 10,978 19,605 250 30,833 Total revenue from external customers $ 182,482 $ 143,728 $ 30,267 $ 356,477

Retirement Plans (Tables)

Retirement Plans (Tables)	3 Months Ended
	Mar. 31, 2019
Retirement Plans [Abstract]
Annual Benefit Cost	The Company’s components of annual benefit cost for the defined benefit plans for the periods presented are as follows: Three Months Ended March 31, (In thousands) 2019 2018 Service cost $ 359 $ 368 Interest cost 320 289 Expected return on plan assets (231 ) (245 ) Recognized actuarial gain (39 ) (27 ) Total defined benefit expense $ 409 $ 385

Leases (Tables)

Leases (Tables)	3 Months Ended
	Mar. 31, 2019
Leases [Abstract]
Maturities of Operating Lease Liabilities	As of March 31, 2019, maturities of operating lease liabilities for future annual periods are as follows: (in thousands) Year ending December 31, 2019 $ 6,537 2020 6,998 2021 3,715 2022 1,800 2023 1,044 Thereafter 2,330 Total lease payments 22,424 Less imputed interest (1,651 ) Present value of lease liabilities $ 20,773

Accumulated Other Comprehensi_2

Accumulated Other Comprehensive Income (Tables)	3 Months Ended
	Mar. 31, 2019
Accumulated Other Comprehensive Income [Abstract]
Changes in OCI	The following table summarizes the changes in OCI during the three-month periods ended March 31, 2019 and 2018: (In thousands) Cash Flow Hedges (a) Pension Items (a) Foreign Currency Items Total Balance as of December 31, 2017 $ (669 ) $ (309 ) $ (148,356 ) $ (149,334 ) Other comprehensive income before reclassifications 670 - 23,186 23,856 Amounts reclassified from OCI 38 (30 ) - 8 Balance as of March 31, 2018 $ 39 $ (339 ) $ (125,170 ) $ (125,470 ) (In thousands) Cash Flow Hedges (a) Pension Items (a) Foreign Currency Items Total Balance as of December 31, 2018 $ 147 $ 549 $ (166,251 ) $ (165,555 ) Other comprehensive income before reclassifications 597 - (1,164 ) (567 ) Amounts reclassified from OCI (112 ) (37 ) - (149 ) Balance as of March 31, 2019 $ 632 $ 512 $ (167,415 ) $ (166,271 ) (a) Cash Flow Hedges and Pension Items are net of tax.

Accounting Policies (Details)

Accounting Policies (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
New Accounting Pronouncements and Changes in Accounting Principles [Abstract]
Right of use assets	$ 20,800
Lease liabilities	20,773
Collected on sold receivables	$ 0	$ 44,406
ASU 2016-02 [Member]
New Accounting Pronouncements and Changes in Accounting Principles [Abstract]
Right of use assets			$ 20,700
Lease liabilities			$ 20,700
ASU 2016-15 [Member] | Restatement Adjustment [Member]
New Accounting Pronouncements and Changes in Accounting Principles [Abstract]
Collected on sold receivables		35,400
Proceeds from life insurance		$ 1,600

Acquisitions (Details)

Acquisitions (Details) - USD ($) $ in Thousands	Jul. 10, 2018	Mar. 09, 2018	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Acquisition [Abstract]
Acquisition of new businesses			$ 0	$ (11,000)
Goodwill			$ 413,710		$ 416,175
Globe Natural [Member]
Acquisition [Abstract]
Acquisition of new businesses		$ (10,800)
Net assets acquired		1,400
Goodwill		7,400
Globe Natural [Member] | Customer Relationships [Member]
Acquisition [Abstract]
Intangibles assets acquired		$ 2,000
Mazza Innovation Limited [Member]
Acquisition [Abstract]
Acquisition of new businesses	$ (19,800)
Net assets acquired	4,000
Goodwill	8,900
Mazza Innovation Limited [Member] | Technological Know-how [Member]
Acquisition [Abstract]
Intangibles assets acquired	$ 6,900

Fair Value (Details)

Fair Value (Details) - Level 2 [Member] $ in Millions	Mar. 31, 2019USD ($)
Carrying Value [Member]
Investments, Fair Value Disclosure [Abstract]
Long term debt	$ 689
Fair Value [Member]
Investments, Fair Value Disclosure [Abstract]
Long term debt	$ 702.7

Segment Information, Operating

Segment Information, Operating Results by Segment (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Revenue [Abstract]
Revenue	$ 347,513	$ 356,477
Operating income (loss)	49,420	55,681
Interest expense	5,402	5,555
Earnings before income taxes	44,018	50,126
Flavors & Fragrances [Member]
Revenue [Abstract]
Revenue	178,744	182,482
Operating income (loss)	23,125	25,327
Interest expense	0	0
Earnings before income taxes	23,125	25,327
Color [Member]
Revenue [Abstract]
Revenue	140,250	143,728
Operating income (loss)	30,199	33,672
Interest expense	0	0
Earnings before income taxes	30,199	33,672
Asia Pacific [Member]
Revenue [Abstract]
Revenue	28,519	30,267
Operating income (loss)	4,218	4,872
Interest expense	0	0
Earnings before income taxes	4,218	4,872
Reportable Segments [Member]
Revenue [Abstract]
Revenue	355,951	365,773
Reportable Segments [Member] | Flavors & Fragrances [Member]
Revenue [Abstract]
Revenue	183,553	188,346
Reportable Segments [Member] | Color [Member]
Revenue [Abstract]
Revenue	143,879	147,160
Reportable Segments [Member] | Asia Pacific [Member]
Revenue [Abstract]
Revenue	28,519	30,267
Intersegment Revenue [Member]
Revenue [Abstract]
Revenue	(8,438)	(9,296)
Intersegment Revenue [Member] | Flavors & Fragrances [Member]
Revenue [Abstract]
Revenue	(4,809)	(5,864)
Intersegment Revenue [Member] | Color [Member]
Revenue [Abstract]
Revenue	(3,629)	(3,432)
Intersegment Revenue [Member] | Asia Pacific [Member]
Revenue [Abstract]
Revenue	0	0
Corporate & Other [Member]
Revenue [Abstract]
Revenue	0	0
Operating income (loss)	(8,122)	(8,190)
Interest expense	5,402	5,555
Earnings before income taxes	$ (13,524)	$ (13,745)

Segment Information, Revenue fr

Segment Information, Revenue from External Customers by Product Line (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Revenue [Abstract]
Revenue	$ 347,513	$ 356,477
Flavors & Fragrances [Member]
Revenue [Abstract]
Revenue	178,744	182,482
Flavors [Member]
Revenue [Abstract]
Revenue	104,276	109,051
Natural Ingredients [Member]
Revenue [Abstract]
Revenue	51,219	53,201
Fragrances [Member]
Revenue [Abstract]
Revenue	28,058	26,094
Color [Member]
Revenue [Abstract]
Revenue	140,250	143,728
Food & Beverage Colors [Member]
Revenue [Abstract]
Revenue	80,364	76,816
Cosmetics [Member]
Revenue [Abstract]
Revenue	38,283	45,504
Other Colors [Member]
Revenue [Abstract]
Revenue	25,232	24,840
Asia Pacific [Member]
Revenue [Abstract]
Revenue	28,519	30,267
Intersegment Revenue [Member]
Revenue [Abstract]
Revenue	(8,438)	(9,296)
Intersegment Revenue [Member] | Flavors & Fragrances [Member]
Revenue [Abstract]
Revenue	(4,809)	(5,864)
Intersegment Revenue [Member] | Color [Member]
Revenue [Abstract]
Revenue	(3,629)	(3,432)
Intersegment Revenue [Member] | Asia Pacific [Member]
Revenue [Abstract]
Revenue	$ 0	$ 0

Segment Information, Revenue _2

Segment Information, Revenue from External Customers by Geographic Markets (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Revenue [Abstract]
Revenue	$ 347,513	$ 356,477
North America [Member]
Revenue [Abstract]
Revenue	178,779	182,637
Europe [Member]
Revenue [Abstract]
Revenue	90,177	89,064
Asia Pacific [Member]
Revenue [Abstract]
Revenue	52,300	53,943
Other [Member]
Revenue [Abstract]
Revenue	26,257	30,833
Flavors & Fragrances [Member]
Revenue [Abstract]
Revenue	178,744	182,482
Color [Member]
Revenue [Abstract]
Revenue	140,250	143,728
Asia Pacific [Member]
Revenue [Abstract]
Revenue	28,519	30,267
Reportable Geographical Components [Member] | Flavors & Fragrances [Member] | North America [Member]
Revenue [Abstract]
Revenue	112,747	119,055
Reportable Geographical Components [Member] | Flavors & Fragrances [Member] | Europe [Member]
Revenue [Abstract]
Revenue	48,001	45,427
Reportable Geographical Components [Member] | Flavors & Fragrances [Member] | Asia Pacific [Member]
Revenue [Abstract]
Revenue	7,609	7,022
Reportable Geographical Components [Member] | Flavors & Fragrances [Member] | Other [Member]
Revenue [Abstract]
Revenue	10,387	10,978
Reportable Geographical Components [Member] | Color [Member] | North America [Member]
Revenue [Abstract]
Revenue	66,007	63,582
Reportable Geographical Components [Member] | Color [Member] | Europe [Member]
Revenue [Abstract]
Revenue	42,135	43,631
Reportable Geographical Components [Member] | Color [Member] | Asia Pacific [Member]
Revenue [Abstract]
Revenue	16,425	16,910
Reportable Geographical Components [Member] | Color [Member] | Other [Member]
Revenue [Abstract]
Revenue	15,683	19,605
Reportable Geographical Components [Member] | Asia Pacific [Member] | North America [Member]
Revenue [Abstract]
Revenue	25	0
Reportable Geographical Components [Member] | Asia Pacific [Member] | Europe [Member]
Revenue [Abstract]
Revenue	41	6
Reportable Geographical Components [Member] | Asia Pacific [Member] | Asia Pacific [Member]
Revenue [Abstract]
Revenue	28,266	30,011
Reportable Geographical Components [Member] | Asia Pacific [Member] | Other [Member]
Revenue [Abstract]
Revenue	$ 187	$ 250

Inventories (Details)

Inventories (Details) - USD ($) $ in Millions	Mar. 31, 2019	Dec. 31, 2018
Inventories [Abstract]
Inventories, including finished and in-process products	$ 310.6	$ 320.4
Raw materials and supplies	$ 157.7	$ 170.4

Retirement Plans (Details)

Retirement Plans (Details) - Defined Benefit Plan [Member] - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract]
Service cost	$ 359	$ 368
Interest cost	320	289
Expected return on plan assets	(231)	(245)
Recognized actuarial gain	(39)	(27)
Total defined benefit expense	$ 409	$ 385

Leases (Details)

Leases (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2019USD ($)
Leases [Abstract]
Extended lease term	5 years
Operating lease expense	$ 3,000
Cash paid for operating leases	2,500
Right-of-use assets in exchange for operating lease obligations	2,400
Right of use assets	20,800
Operating lease, other accrued expenses	7,900
Operating lease, other liabilities	$ 12,900
Weighted average remaining operating lease term	3 years 8 months 12 days
Weighted average discount rate for operating leases	3.80%
Maturities of Operating Lease Liabilities [Abstract]
2019	$ 6,537
2020	6,998
2021	3,715
2022	1,800
2023	1,044
Thereafter	2,330
Total lease payments	22,424
Less imputed interest	(1,651)
Present value of lease liabilities	$ 20,773

Derivative Instruments and He_2

Derivative Instruments and Hedging Activity (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Maximum [Member]
Derivative instruments and hedging activity for the period [Abstract]
Number of months for contracts to mature	18 months
Forward Exchange Contracts [Member] | Cash Flow Hedges [Member]
Derivative instruments and hedging activity for the period [Abstract]
Derivative, fair value	$ 59.2	$ 76
Foreign Currency Denominated Debt, Net Investment Hedging [Member]
Derivative instruments and hedging activity for the period [Abstract]
Carrying value of foreign denominated debt	361.7	$ 366.5
Impact of foreign exchange rates on debt instruments recorded in Other Comprehensive Income	$ 4.9

Income Taxes (Details)

Income Taxes (Details)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Income Taxes [Abstract]
Effective income tax rates for continuing operations	25.50%	23.80%

Accumulated Other Comprehensi_3

Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2019	Mar. 31, 2018
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance		$ 859,947
Other comprehensive income before reclassifications		(567)	$ 23,856
Amounts reclassified from OCI		(149)	8
Ending balance		877,724
Accumulated Other Comprehensive (Loss) Income [Member]
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance		(165,555)	(149,334)
Ending balance		(166,271)	(125,470)
Cash Flow Hedges [Member]
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance	[1]	147	(669)
Other comprehensive income before reclassifications	[1]	597	670
Amounts reclassified from OCI	[1]	(112)	38
Ending balance	[1]	632	39
Pension Items [Member]
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance	[1]	549	(309)
Other comprehensive income before reclassifications	[1]	0	0
Amounts reclassified from OCI	[1]	(37)	(30)
Ending balance	[1]	512	(339)
Foreign Currency Items [Member]
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance		(166,251)	(148,356)
Other comprehensive income before reclassifications		(1,164)	23,186
Amounts reclassified from OCI		0	0
Ending balance		$ (167,415)	$ (125,170)
[1]	Cash Flow Hedges and Pension Items are net of tax.

Accounts Receivable Securitiz_2

Accounts Receivable Securitization (Details) $ in Millions	Mar. 31, 2019USD ($)
Accounts Receivable Securitization [Abstract]
Accounts receivable securitization program commitment amount	$ 70
Maximum borrowing capacity, secured loan	70
Credit facility, borrowings outstanding	$ 70