Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 01, 2023 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 1-4858 | |
Entity Registrant Name | INTERNATIONAL FLAVORS & FRAGRANCES INC | |
Entity Incorporation, State or Country Code | NY | |
Entity Tax Identification Number | 13-1432060 | |
Entity Address, Address Line One | 521 West 57th Street | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10019 | |
City Area Code | 212 | |
Local Phone Number | 765-5500 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 255,279,134 | |
Entity Central Index Key | 0000051253 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Other Address | ||
Entity Information [Line Items] | ||
Entity Address, Address Line One | 200 Powder Mill Road | |
Entity Address, City or Town | Wilmington | |
Entity Address, State or Province | DE | |
Entity Address, Postal Zip Code | 19803 | |
Common Stock, par value 12 1/2¢ per share | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Common Stock, par value 12 1/2¢ per share | |
Trading Symbol | IFF | |
Security Exchange Name | NYSE | |
1.750% Senior Notes due 2024 | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | 1.750% Senior Notes due 2024 | |
Trading Symbol | IFF 24 | |
Security Exchange Name | NYSE | |
1.800% Senior Notes due 2026 | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | 1.800% Senior Notes due 2026 | |
Trading Symbol | IFF 26 | |
Security Exchange Name | NYSE |
CONSOLIDATED BALANCE SHEET
CONSOLIDATED BALANCE SHEET - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Current Assets: | ||
Cash and cash equivalents | $ 629 | $ 483 |
Restricted cash | 10 | 10 |
Trade receivables, net | 1,831 | 1,818 |
Inventories: | ||
Raw materials | 862 | 1,073 |
Work in process | 431 | 442 |
Finished goods | 1,256 | 1,636 |
Total Inventories | 2,549 | 3,151 |
Assets held for sale | 482 | 1,200 |
Prepaid expenses and other current assets | 890 | 770 |
Total Current Assets | 6,391 | 7,432 |
Property, plant and equipment, at cost | 6,368 | 6,180 |
Accumulated depreciation | (2,242) | (1,977) |
Total Property Plant and Equipment | 4,126 | 4,203 |
Goodwill | 13,031 | 13,355 |
Other intangible assets, net | 8,381 | 9,082 |
Operating lease right-of-use assets | 703 | 743 |
Other assets | 763 | 689 |
Total Assets | 33,395 | 35,504 |
Current Liabilities: | ||
Bank borrowings, overdrafts, and current portion of long-term debt | 1,142 | 410 |
Commercial paper | 0 | 187 |
Accounts payable | 1,112 | 1,418 |
Accrued payroll and bonus | 236 | 267 |
Dividends payable | 207 | 206 |
Liabilities held for sale | 49 | 212 |
Other current liabilities | 937 | 1,028 |
Total Current Liabilities | 3,683 | 3,728 |
Long-term debt | 9,159 | 10,373 |
Retirement liabilities | 228 | 231 |
Deferred income taxes | 2,127 | 2,265 |
Operating lease liability | 654 | 672 |
Other liabilities | 475 | 491 |
Total Other Liabilities | 12,643 | 14,032 |
Commitments and Contingencies | ||
Redeemable non-controlling interests | 60 | 59 |
Shareholders' Equity: | ||
Common Stock, Value, Issued | 35 | 35 |
Capital in excess of par value | 19,865 | 19,841 |
Retained earnings | 378 | 955 |
Accumulated other comprehensive loss | (2,336) | (2,198) |
Treasury Stock, Value | (964) | (978) |
Total Shareholders’ Equity | 16,978 | 17,655 |
Non-controlling interest | 31 | 30 |
Total Shareholders’ Equity including Non-controlling interest | 17,009 | 17,685 |
Total Liabilities and Shareholders’ Equity | $ 33,395 | $ 35,504 |
CONSOLIDATED BALANCE SHEET (Par
CONSOLIDATED BALANCE SHEET (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Trade receivables allowances | $ 55 | $ 53 |
Common stock, par value, in dollars per share | $ 0.125 | $ 0.125 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 275,726,629 | 275,726,629 |
Common stock, shares outstanding | 255,268,628 | 254,968,463 |
Treasury stock (in shares) | 20,458,001 | 20,758,166 |
CONSOLIDATED STATEMENT OF INCOM
CONSOLIDATED STATEMENT OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||||
Net sales | $ 2,820 | $ 3,063 | $ 8,776 | $ 9,596 |
Cost of goods sold | 1,896 | 2,062 | 5,955 | 6,314 |
Gross profit | 924 | 1,001 | 2,821 | 3,282 |
Research and development expenses | 157 | 145 | 479 | 460 |
Selling and administrative expenses | 444 | 413 | 1,343 | 1,328 |
Amortization of acquisition-related intangibles | 170 | 182 | 513 | 552 |
Impairment of goodwill | 0 | 2,250 | 0 | 2,250 |
Impairment of long-lived assets | 0 | 0 | 0 | 120 |
Restructuring and other charges | 2 | (4) | 61 | 5 |
Gain (Loss) on Disposition of Assets | (1) | 0 | 1 | 2 |
Operating profit (loss) | 150 | (1,985) | 426 | (1,431) |
Interest expense | 110 | 83 | 337 | 232 |
Other income, net | (19) | (33) | (34) | (43) |
Income (loss) before taxes | 59 | (2,035) | 123 | (1,620) |
Provision for income taxes | 32 | 160 | 77 | 220 |
Net income (loss) | 27 | (2,195) | 46 | (1,840) |
Net income attributable to non-controlling interests | 2 | 2 | 3 | 6 |
Net income (loss) attributable to IFF shareholders | $ 25 | $ (2,197) | $ 43 | $ (1,846) |
Net income per share - basic (in dollars per share) | $ 0.10 | $ (8.60) | $ 0.16 | $ (7.22) |
Net income per share - diluted (in dollars per share) | $ 0.10 | $ (8.60) | $ 0.16 | $ (7.22) |
Average number of shares outstanding - basic (in shares) | 255 | 255 | 255 | 255 |
Average number of shares outstanding - diluted (in shares) | 256 | 255 | 255 | 255 |
Other comprehensive loss, after tax: | ||||
Foreign currency translation adjustments | $ (476) | $ (982) | $ (132) | $ (1,770) |
Pension and postretirement liability adjustment | (3) | 5 | (6) | 6 |
Net current period other comprehensive income (loss) | (479) | (977) | (138) | (1,764) |
Comprehensive loss | (452) | (3,172) | (92) | (3,604) |
Comprehensive loss attributable to IFF shareholders | $ (454) | $ (3,174) | $ (95) | $ (3,610) |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 46 | $ (1,840) |
Adjustments to reconcile to net cash provided by operating activities | ||
Depreciation and amortization | 855 | 897 |
Deferred income taxes | (59) | (222) |
Gain (Loss) on Disposition of Assets | 1 | 2 |
Losses (gains) on business divestitures | 29 | (14) |
Stock-based compensation | 50 | 37 |
Pension contributions | (25) | (25) |
Impairment of long-lived assets | 0 | 120 |
Inventory write-down | 62 | 0 |
Changes in assets and liabilities, net of acquisitions: | ||
Trade receivables | (78) | (309) |
Inventories | 489 | (808) |
Accounts payable | (240) | 111 |
Accruals for incentive compensation | (40) | (56) |
Other current payables and accrued expenses | (216) | 202 |
Other assets/liabilities, net | (77) | (152) |
Net cash provided by operating activities | 795 | 189 |
Cash flows from investing activities: | ||
Cash paid for acquisitions, net of cash received | 0 | (110) |
Additions to property, plant and equipment | (390) | (344) |
Additions to intangible assets | 0 | (2) |
Proceeds from disposal of assets | 22 | 1 |
Cash provided by the Merger with N&B | 0 | 11 |
Proceeds from unwinding of derivative instruments | 0 | 173 |
Net cash provided by investing activities | 638 | 887 |
Cash flows from financing activities: | ||
Cash dividends paid to shareholders | (619) | (604) |
(Decrease) increase in revolving credit facility and short-term borrowings | (100) | 2 |
Proceeds from issuance of commercial paper (maturities after three months) | 0 | 160 |
Repayments of commercial paper (maturities after three months) | 0 | (235) |
Net repayments of commercial paper (maturities less than three months) | (187) | (52) |
Deferred financing costs | (5) | 0 |
Repayments of long-term debt | (355) | (300) |
Deferred consideration paid | (6) | 0 |
Employee withholding taxes paid | (12) | (20) |
Proceeds from (Payments for) Other Financing Activities | (9) | (38) |
Net cash used in financing activities | (1,293) | (1,087) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (30) | (150) |
Net change in cash, cash equivalents and restricted cash | 110 | (161) |
Cash, cash equivalents and restricted cash at beginning of year | 552 | 716 |
Cash, cash equivalents and restricted cash at end of period | 662 | 555 |
Supplemental Disclosures: | ||
Interest paid, net of amounts capitalized | 261 | 199 |
Income taxes paid | 450 | 276 |
Accrued capital expenditures | 67 | 93 |
Net proceeds received from business divestitures | $ 1,006 | $ 1,158 |
CONSOLIDATED STATEMENT OF SHARE
CONSOLIDATED STATEMENT OF SHAREHOLDERS EQUITY - USD ($) $ in Millions | Total | Common stock | Capital in excess of par value | Retained earnings | Accumulated other comprehensive (loss) income | Treasury stock | Non-controlling interest |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Treasury stock (in shares) | 21,152,645 | ||||||
Common stock outstanding, beginning balance, shares at Dec. 31, 2021 | 275,726,629 | ||||||
Beginning Balance at Dec. 31, 2021 | $ 21,117 | $ 35 | $ 19,826 | $ 3,641 | $ (1,423) | $ (997) | $ 35 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | (1,843) | (1,846) | 3 | ||||
Foreign currency translation adjustments | (1,770) | (1,770) | |||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | 6 | 6 | |||||
Cash dividends declared | (609) | (609) | |||||
Stock Issued During Period, Value, Stock Options Exercised | 15 | 11 | $ 4 | ||||
Stock options/SSARs, shares | 85,728 | ||||||
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures | (25) | (39) | $ 14 | ||||
Vested restricted stock units and awards, shares | 289,918 | ||||||
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | 37 | 37 | |||||
Exercises of redeemable noncontrolling interests | (5) | 1 | (6) | ||||
Net Income (Loss) Attributable to Redeemable Noncontrolling Interest | (4) | (4) | |||||
Dividends paid | 2 | 2 | |||||
Common stock outstanding, ending balance, shares at Sep. 30, 2022 | 275,726,629 | ||||||
Ending Balance at Sep. 30, 2022 | 16,921 | $ 35 | 19,832 | 1,186 | (3,187) | $ (979) | 34 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Treasury stock (in shares) | 20,781,898 | ||||||
Common stock outstanding, beginning balance, shares at Jun. 30, 2022 | 275,726,629 | ||||||
Beginning Balance at Jun. 30, 2022 | 20,293 | $ 35 | 19,826 | 3,589 | (2,210) | $ (980) | 33 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | (2,196) | (2,197) | 1 | ||||
Foreign currency translation adjustments | (982) | (982) | |||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | 5 | 5 | |||||
Cash dividends declared | (206) | (206) | |||||
Stock Issued During Period, Value, Stock Options Exercised | 1 | 1 | |||||
Stock options/SSARs, shares | 1,551 | ||||||
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures | 0 | (1) | $ 1 | ||||
Vested restricted stock units and awards, shares | 3,348 | ||||||
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | 12 | 12 | |||||
Net Income (Loss) Attributable to Redeemable Noncontrolling Interest | (6) | (6) | |||||
Common stock outstanding, ending balance, shares at Sep. 30, 2022 | 275,726,629 | ||||||
Ending Balance at Sep. 30, 2022 | $ 16,921 | $ 35 | 19,832 | 1,186 | (3,187) | $ (979) | 34 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Treasury stock (in shares) | 20,776,999 | ||||||
Treasury stock (in shares) | 20,758,166 | 20,758,166 | |||||
Common stock outstanding, beginning balance, shares at Dec. 31, 2022 | 275,726,629 | ||||||
Beginning Balance at Dec. 31, 2022 | $ 17,685 | $ 35 | 19,841 | 955 | (2,198) | $ (978) | 30 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | 46 | 43 | 3 | ||||
Foreign currency translation adjustments | (132) | (132) | |||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | (6) | (6) | |||||
Cash dividends declared | (620) | (620) | |||||
Stock Issued During Period, Value, Stock Options Exercised | (1) | (5) | $ 4 | ||||
Stock options/SSARs, shares | 88,557 | ||||||
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures | (10) | (20) | $ 10 | ||||
Vested restricted stock units and awards, shares | 211,608 | ||||||
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | 50 | 50 | |||||
Net Income (Loss) Attributable to Redeemable Noncontrolling Interest | (1) | (1) | |||||
Dividends paid | (2) | (2) | |||||
Common stock outstanding, ending balance, shares at Sep. 30, 2023 | 275,726,629 | ||||||
Ending Balance at Sep. 30, 2023 | 17,009 | $ 35 | 19,865 | 378 | (2,336) | $ (964) | 31 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Treasury stock (in shares) | 20,504,898 | ||||||
Common stock outstanding, beginning balance, shares at Jun. 30, 2023 | 275,726,629 | ||||||
Beginning Balance at Jun. 30, 2023 | 17,655 | $ 35 | 19,851 | 560 | (1,857) | $ (966) | 32 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | 27 | 25 | 2 | ||||
Foreign currency translation adjustments | (476) | (476) | |||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | (3) | (3) | |||||
Cash dividends declared | (207) | (207) | |||||
Stock Issued During Period, Value, Stock Options Exercised | (1) | (2) | $ 1 | ||||
Stock options/SSARs, shares | 29,671 | ||||||
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures | (1) | (2) | $ 1 | ||||
Vested restricted stock units and awards, shares | 17,226 | ||||||
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | 18 | 18 | |||||
Dividends paid | (3) | (3) | |||||
Common stock outstanding, ending balance, shares at Sep. 30, 2023 | 275,726,629 | ||||||
Ending Balance at Sep. 30, 2023 | $ 17,009 | $ 35 | $ 19,865 | $ 378 | $ (2,336) | $ (964) | $ 31 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Treasury stock (in shares) | 20,458,001 | 20,458,001 |
CONSOLIDATED STATEMENT OF SHA_2
CONSOLIDATED STATEMENT OF SHAREHOLDERS EQUITY (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||||
Pension liability and postretirement adjustment; tax | $ 1 | $ (1) | $ 1 | $ (2) |
Dividends declared per share, in dollars per share | $ 0.81 | $ 0.81 | $ 2.43 | $ 2.39 |
Nature of Operations and Summar
Nature of Operations and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Nature of Operations and Summary of Significant Accounting Policies | NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations International Flavors & Fragrances Inc. and its subsidiaries (the “Registrant,” “IFF,” “the Company,” “we,” “us” and “our”) is a leading creator and manufacturer of food, beverage, health & biosciences, scent and pharma solutions and complementary adjacent products, including cosmetic active and natural health ingredients, which are used in a wide variety of consumer products. Our products are sold principally to manufacturers of perfumes and cosmetics, hair and other personal care products, soaps and detergents, cleaning products, dairy, meat and other processed foods, beverages, snacks and savory foods, sweet and baked goods, sweeteners, dietary supplements, food protection, infant and elderly nutrition, functional food, and pharmaceutical excipients and oral care products. Basis of Presentation The accompanying interim Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and the related notes included in our 2022 Annual Report on Form 10-K (“2022 Form 10-K”). The interim Consolidated Financial Statements are unaudited. In addition, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted, if not materially different from the 2022 Form 10-K. The year-end balance sheet data included in this Form 10-Q was derived from the audited financial statements. In the opinion of management, all adjustments, which consist of normal recurring adjustments necessary for a fair statement of the interim Consolidated Financial Statements, have been made. Correction of Prior Year Consolidated Financial Statements In the second quarter of 2023, the Company revised its Operating lease right-of-use assets from $636 million to $743 million and Operating lease liabilities from $565 million to $672 million on its Consolidated Balance Sheets as of December 31, 2022. This reflects the correction of an error of $107 million related to a lease renewal that was not correctly reflected in the prior year period. In addition, the Company revised its Other assets from $699 million to $689 million, which included a $9 million impact to deferred income taxes, Other liabilities from $472 million to $491 million and Accumulated other comprehensive loss from $2.169 billion to $2.198 billion on its Consolidated Balance Sheets as of December 31, 2022 and Consolidated Statements of Shareholders’ Equity at January 1, 2023. This reflects the correction of an error related to the fair value of derivative assets and liabilities of cross currency swaps. The impacts of these corrections are also presented in the related footnotes. Reporting Periods The Company uses a calendar year of the twelve-month period from January 1 to December 31. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) requires management to make estimates and judgments that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. The inputs into the Company’s judgments and estimates take into account the ongoing global current events and adverse macroeconomic impacts on our critical and significant accounting estimates, including estimates associated with future cash flows that are used in assessing the risk of impairment of certain assets. Actual results could differ from those estimates. Cash, Cash Equivalents and Restricted Cash Cash, cash equivalents and restricted cash reported in the Company’s balance sheet as of September 30, 2023, December 31, 2022, September 30, 2022 and December 31, 2021 were as follows: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 September 30, 2022 December 31, 2021 Current assets Cash and cash equivalents $ 629 $ 483 $ 538 $ 711 Cash and cash equivalents included in Assets held for sale 23 52 — — Restricted cash 10 10 10 4 Non-current assets Restricted cash included in Other assets — 7 7 1 Cash, cash equivalents and restricted cash $ 662 $ 552 $ 555 $ 716 Accounts Receivable The Company has various factoring agreements in the U.S. and The Netherlands under which it can factor up to approximately €250 million in receivables (“Company’s own factoring agreements”). In addition, the Company utilizes factoring agreements sponsored by certain customers. Under all of the arrangements, the Company sells the receivables on a non-recourse basis to unrelated financial institutions and accounts for the transactions as a sale of receivables. The applicable receivables are removed from the Company’s Consolidated Balance Sheets when the cash proceeds are received by the Company. The Company sold a total of approximately $1.302 billion and $983 million of receivables under the Company’s own factoring agreements and customer sponsored factoring agreements for the nine months ended September 30, 2023 and 2022, respectively. The cost of participating in these programs was approximately $6 million and $3 million for the three months ended September 30, 2023 and 2022, respectively, and was approximately $18 million and $6 million for the nine months ended September 30, 2023 and 2022, respectively. These costs are included as a component of interest expense. Under the Company’s own factoring agreements, it sold approximately $632 million and $323 million of receivables for the nine months ended September 30, 2023 and 2022, respectively. The outstanding principal amounts of receivables under the Company’s own factoring agreements amounted to approximately $148 million and $157 million as of September 30, 2023 and December 31, 2022, respectively. The proceeds from the sales of receivables are included in net cash from operating activities in the Consolidated Statements of Cash Flows. Revenue Recognition The Company recognizes revenue from contracts with customers when the contract or purchase order has received approval and commitment from both parties, has the rights of the parties and payment terms (which can vary by customer) identified, has commercial substance, collectability of consideration is probable, and control has transferred. The revenue recognized reflects the consideration the Company expects to be entitled to in exchange for those goods. Sales, value added, and other taxes the Company collects are excluded from revenues. The Company receives payment in accordance with standard customer terms. Sales are reduced, at the time revenue is recognized, for applicable discounts, rebates and sales allowances based on historical experience. Related accruals are included in Other current liabilities in the accompanying Consolidated Balance Sheets. The Company considers shipping and handling activities undertaken after the customer has obtained control of the related goods as a fulfillment activity. Net sales include shipping and handling charges billed to customers. Cost of goods sold includes all costs incurred in connection with shipping and handling. See Note 12 for further details on revenues disaggregated by segment. Contract Assets and Liabilities With respect to a small number of contracts for the sale of compounds, the Company has an “enforceable right to payment for performance to date” and as the products do not have an alternative use, the Company recognizes revenue for these contracts over time and records a contract asset using the output method. The output method recognizes revenue on the basis of direct measurements of the value to the customer of the goods or services transferred to date relative to the remaining goods or services promised under the contract. As of September 30, 2023 and December 31, 2022, the Company’s gross accounts receivable were $1.886 billion and $1.871 billion, respectively. The Company’s contract assets and contract liabilities as of September 30, 2023 and December 31, 2022 were not material. Expected Credit Losses The Company is exposed to credit losses primarily through its sales of products. To determine the appropriate allowance for expected credit losses, the Company considers certain credit quality indicators, such as aging, collection history, and creditworthiness of debtors. Regional and Global Credit committees review and approve specific customer allowance reserves. The allowance for expected credit losses is primarily based on two primary factors: i) the aging of the different categories of trade receivables, and ii) a specific reserve for accounts identified as uncollectible. The Company also considers current and future economic conditions in the determination of the allowance. At September 30, 2023, the Company reported $1.831 billion of trade receivables, net of allowances of $55 million. Based on the aging analysis as of September 30, 2023, approximately 1% of the Company’s accounts receivable were past due by over 365 days based on the payment terms of the invoice. The following is a rollforward of the Company’s allowances for bad debts for the nine months ended September 30, 2023: (DOLLARS IN MILLIONS) Allowances for Balance at December 31, 2022 $ 53 Bad debt expense (1) 9 Write-offs (6) Foreign exchange (1) Balance at September 30, 2023 $ 55 _______________________ (1) Bad debt expense included approximately $13 million related to expected credit losses on receivables from certain customers in Egypt, offset by approximately $8 million of reversals of allowances on receivables from customers located in Russia and Ukraine. The Company will continue to evaluate its credit exposure related to Egypt, Russia and Ukraine. Long-Lived Assets The Company reviews long-lived assets for impairment when events or changes in business conditions indicate that their carrying value may not be recovered. An estimate of undiscounted future cash flows produced by an asset or group of assets is compared to the carrying value to determine whether impairment exists. If assets are determined to be impaired, the loss is measured based on an estimate of fair value using various valuation techniques, including a discounted estimate of future cash flows. Goodwill Goodwill represents the difference between the total purchase price and the fair value of identifiable assets and liabilities acquired in business acquisitions. The Company tests goodwill for impairment at the reporting unit level as of November 30 every year, or more frequently if events or changes in circumstances indicate the asset might be impaired. A reporting unit is an operating segment or one level below an operating segment (referred to as a component or group of components) to which goodwill is assigned when initially recorded. The Company identifies its reporting units by assessing whether the components of its reporting segments constitute businesses for which discrete financial information is available and management of each reporting unit regularly reviews the operating results of those components. The Company determined that it has six reporting units under the Nourish, Health & Biosciences, Scent and Pharma Solutions segments: (1) Nourish, (2) Fragrance Compounds, (3) Fragrance Ingredients, (4) Cosmetic Ingredients, (5) Health & Biosciences and (6) Pharma Solutions. These reporting units were determined based on the level at which the performance is measured and reviewed by segment management. In cases where the components of an operating segment have similar economic characteristics, they are aggregated into a single reporting unit. During the third quarter of 2022, the Company determined that the carrying value of the Health & Biosciences reporting unit exceeded its fair value and recorded a goodwill impairment charge of $2.250 billion on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the three and nine months ended September 30, 2022 (see Note 6 for additional information). Events in Israel The Company maintains operations in Israel and, additionally, exports products to customers in Israel from operations outside the region. The Company will continue to evaluate the current events and any potential impacts to its Consolidated Financial Statements. Events in Russia and Ukraine The Company maintains operations in both Russia and Ukraine and, additionally, exports products to customers in Russia and Ukraine from operations outside the region. In response to the events in Ukraine, the Company has limited the production and supply of ingredients in and to Russia to only those that meet the essential needs of people, including food, hygiene and medicine. Allowances for Bad Debts As of September 30, 2023, the Company had a reserve of approximately $3 million related to expected credit losses on receivables from customers located in Russia and Ukraine. The Company will continue to evaluate its credit exposure related to Russia and Ukraine. Impairment of Long-Lived Assets During the second quarter of 2022, the sales and margins declined for certain entities within Russia due to supply chain issues, reduced product demand and exchange rate volatility. Further, it was determined that such declines in operating performance were not expected to reverse in the near future. Additionally, future expected growth was expected to be limited given operating conditions in Russia, which inhibited the required future investment. In connection with uncertainties related to the Company’s operations in Russia and Ukraine, the Company updated its analysis of the undiscounted cash flows of the applicable asset groups to determine if the cash flows exceeded the carrying values of the applicable asset groups. With respect to an asset group in the Nourish segment, that manufactures and sells in Russia and related markets, it was determined that the undiscounted cash flows were insufficient to cover the carrying value and that an impairment charge was required to write-down the long-lived assets to their fair values. The fair value of such asset group was determined based on a discounted cash flow approach which involved estimating the future cash flows for the business discounted to their present values. The discount rate used in the determination of such fair value was based on consideration of the risks inherent in the cash flows and market as of the valuation date. As a result of this assessment, the Company recognized an impairment charge of $120 million during the second quarter of 2022, which was allocated on a pro rata basis to intangible assets and property, plant and equipment within the asset group in the amounts of approximately $92 million and $28 million, respectively. Recent Accounting Pronouncements In December 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2022-06, “Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848.” The ASU was issued to provide an update on ASU 2020-04 and ASU 2021-01 that were issued in March 2020 and January 2021, respectively, which provided optional accounting guidance for a limited period of time to ease the potential burden in accounting for reference rate reform. The guidance provides optional expedients and exceptions to existing accounting requirements for contract modifications and hedge accounting related to transitioning from discontinued reference rates, such as London Interbank Offered Rate (“LIBOR”), to alternative reference rates, if certain criteria are met. With the issuance of ASU 2022-06, the sunset date of Topic 848 has been deferred from December 31, 2022 to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. The Company has adopted this guidance on January 1, 2023, which did not have a material impact on its Consolidated Financial Statements. On March 23, 2023, the Company amended certain existing debt agreements where the interest rate benchmark was updated from LIBOR to the Secured Overnight Financing Rate (“Term SOFR”). The Company applied Topic 848 to its recent amendments of its debt agreements. See Note 8 for additional information on the amendments to the debt agreements. |
Net Income Per Share
Net Income Per Share | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | NET INCOME (LOSS) PER SHARE A reconciliation of the shares used in the computation of basic and diluted net income (loss) per share is as follows: Three Months Ended September 30, Nine Months Ended September 30, (AMOUNTS IN MILLIONS EXCEPT PER SHARE AMOUNTS) 2023 2022 2023 2022 Net Income (Loss) Net income (loss) attributable to IFF shareholders $ 25 $ (2,197) $ 43 $ (1,846) Adjustment related to (increase) decrease in redemption value of redeemable noncontrolling interests in excess of earnings allocated — 1 (1) 3 Net income (loss) available to IFF shareholders $ 25 $ (2,196) $ 42 $ (1,843) Shares Weighted average common shares outstanding (basic) 255 255 255 255 Adjustment for assumed dilution: Stock options and restricted stock awards 1 — — — Weighted average shares assuming dilution (diluted) 256 255 255 255 Net Income (Loss) per Share Net income (loss) per share - basic (1) $ 0.10 $ (8.60) $ 0.16 $ (7.22) Net income (loss) per share - diluted (1) 0.10 (8.60) 0.16 (7.22) _______________________ (1) For the three and nine months ended September 30, 2022, the basic and diluted net loss per share cannot be recalculated based on the information presented in the table above due to rounding. The Company declared a quarterly dividend to its shareholders of $0.81 per share for each of the three months ended September 30, 2023 and 2022. For the nine months ended September 30, 2023 and 2022, the Company declared quarterly dividends to its shareholders totaling $2.43 and $2.39, respectively. There were approximately 0.3 million and 0.4 million potentially dilutive securities excluded from the computation of diluted net loss per share for the three and nine months ended September 30, 2022, respectively, because there was a net loss attributable to IFF for these periods and, as such, the inclusion of these securities would have been anti-dilutive. For the three and nine months ended September 30, 2023, there were approximately 0.4 million share equivalents that had an anti-dilutive effect and therefore were excluded from the computation of diluted net income per share in these periods. For the three and nine months ended September 30, 2022, there were approximately 0.3 million share equivalents that had an anti-dilutive effect and therefore were excluded from the computation of diluted net loss per share in these periods. The Company has issued shares of Purchased Restricted Stock Units (“PRSUs”) which contain rights to non-forfeitable dividends while these shares are outstanding and thus are considered participating securities. Such securities are required to be included in the computation of basic and diluted earnings per share pursuant to the two-class method. |
Business Divestitures
Business Divestitures | 9 Months Ended |
Sep. 30, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Business Divestitures | BUSINESS DIVESTITURES Divestiture of the Flavor Specialty Ingredients Business During the fourth quarter of 2022, the Company announced it had entered into an agreement to sell its Flavor Specialty Ingredients (“FSI”) business, which was a part of the Scent segment. The Company completed the divestiture on August 1, 2023, and received cash proceeds of approximately $190 million, which included $1 million related to the delayed transfer of the control of specific assets and liabilities of non-U.S. jurisdiction business. Concurrent with the completion of the business divestiture, the Company entered into a supply agreement arrangement with the buyer. Based on the terms of the supply agreement, an adjustment of $4 million was made against the fair value of sale consideration. In addition, approximately $15 million of proceeds were held in escrow and will be released upon satisfaction of certain conditions. The proceeds held in escrow were presented in Prepaid expenses and other current assets on the Consolidated Balance Sheets. The sale consideration is subject to certain post-closing adjustments, which primarily relate to cash, indebtedness and working capital balances. The following table summarizes the fair value of sale consideration received in connection with the business divestiture: (DOLLARS IN MILLIONS) Cash proceeds from the buyer $ 190 Amount held in escrow 15 Advance receipt for business to be transferred (1) Direct costs to sell (5) Proceeds attributable to supply agreement (4) Fair value of sale consideration $ 195 The net proceeds received from the business divestiture presented under Cash flows from investing activities represent the cash portion of the sale consideration, which was determined as the fair value of sale consideration adjusted by the direct costs to sell, advance receipt for business to be transferred, amount held in escrow and the cash transferred to the buyer as part of the transaction. The following table summarizes the different components of net proceeds received from business divestiture presented under Cash flows from investing activities: (DOLLARS IN MILLIONS) Fair value of sale consideration $ 195 Direct costs to sell 5 Advance receipt for business to be transferred 1 Amount held in escrow (15) Cash transferred to the buyer (1) Net proceeds received from business divestiture $ 185 The carrying amount of net assets associated with the business unit, adjusted for currency translation adjustment, was approximately $205 million. The major classes of assets and liabilities sold consisted of the following: (DOLLARS IN MILLIONS) August 1, 2023 Assets Cash and cash equivalents $ 1 Trade receivables, net 13 Inventories 45 Property, plant and equipment, net 29 Goodwill 44 Other intangible assets, net 73 Other assets 10 Total assets 215 Liabilities Accounts payable (4) Deferred tax liability (1) Other liabilities (6) Total liabilities (11) Equity Accumulated other comprehensive income - currency translation adjustment 1 Total equity 1 Carrying value of net asset (adjusted for currency translation adjustment) $ 205 As a result of the business divestiture, the Company recognized a pre-tax loss of approximately $10 million, subject to certain post-closing adjustments, presented in Other income, net on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the three and nine months ended September 30, 2023. The Company has also recognized income tax effects associated with the business divestiture across multiple periods. Based on preliminary estimates, the total income taxes recognized was approximately $15 million, with approximately $3 million that was recognized during the year ended December 31, 2022. Divestiture of a Portion of the Savory Solutions Business During the fourth quarter of 2022, the Company announced it had entered into an agreement to sell a portion of its Savory Solutions business, which was part of the Nourish segment. The Company completed the divestiture on May 31, 2023, and received cash proceeds of approximately $840 million. In addition, a receivable of approximately $30 million was recorded which reflects the estimated future payment to be received as part of the sale consideration. The sale consideration is subject to certain post-closing adjustments, which primarily relate to cash, indebtedness and working capital balances. The following table summarizes the fair value of sale consideration received in connection with the business divestiture: (DOLLARS IN MILLIONS) Cash proceeds from the buyer $ 840 Receivable from the buyer 30 Direct costs to sell (20) Fair value of sale consideration $ 850 The net proceeds received from the business divestiture presented under Cash flows from investing activities represent the cash portion of the sale consideration, which was determined as the fair value of sale consideration adjusted by the amount receivable from the buyer, direct costs to sell and the cash transferred to the buyer as part of the transaction. The following table summarizes the different components of net proceeds received from business divestiture presented under Cash flows from investing activities: (DOLLARS IN MILLIONS) Fair value of sale consideration $ 850 Direct costs to sell 20 Receivable from the buyer (30) Cash transferred to the buyer (including restricted cash) (19) Net proceeds received from business divestiture $ 821 The carrying amount of net assets associated with the business unit, adjusted for currency translation and pension adjustments, was approximately $860 million. The major classes of assets and liabilities sold consisted of the following: (DOLLARS IN MILLIONS) May 31, 2023 Assets Cash and cash equivalents $ 15 Restricted cash 4 Trade receivables, net 69 Inventories 116 Property, plant and equipment, net 77 Goodwill 317 Other intangible assets, net 367 Right-of-use assets 20 Other assets 24 Total assets 1,009 Liabilities Accounts payable (44) Deferred tax liability (92) Other liabilities (54) Total liabilities (190) Equity Accumulated other comprehensive income - currency translation adjustment 42 Accumulated other comprehensive income - pension liability and postretirement (1) Total equity 41 Carrying value of net asset (adjusted for currency translation and pension adjustments) $ 860 As a result of the business divestiture, the Company recognized a pre-tax loss of approximately $10 million, subject to certain post-closing adjustments, presented in Other income, net on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the nine months ended September 30, 2023. The Company has also recognized income tax effects associated with the business divestiture across multiple periods. Based on preliminary estimates, the total income taxes recognized was approximately $88 million, with approximately $72 million that was recognized during the year ended December 31, 2022. Liquidation of a Business in Russia As part of the liquidation of a business in Russia for the sale of the portion of the Savory Solutions business, the Company recognized a pre-tax loss of approximately $10 million presented in the Other income, net, and tax benefits of approximately $2 million presented in Provision for income taxes on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the nine months ended September 30, 2023. Divestiture of Microbial Control The Company completed the divestiture of the Microbial Control business unit on July 1, 2022, which was acquired as part of the Company’s merger with Nutrition and Biosciences, Inc. (“N&B”), a wholly-owned subsidiary of DuPont, in 2021 (the “Merger”), and received net cash proceeds of approximately $1.169 billion. The Company also entered into transition services agreements with the buyer for providing certain general accounting, information technology and other services up to 19 months following the date of the sale for minimal consideration. The fair value of these transition services agreements was determined to be approximately $36 million, which was adjusted against the sale consideration and recognized as deferred transition services income. The transition services income under the transition services agreements for the three and nine months ended September 30, 2023 was approximately $6 million and $19 million, respectively, and for the three and nine months ended September 30, 2022 was approximately $6 million. The transition services income was recognized as a reduction to the costs incurred to provide services under the transition services agreements, which was included in Selling and administrative expenses on the Consolidated Statements of Income (Loss) and Comprehensive Loss. During the third quarter of 2023, the Company announced the sale process of its Cosmetic Ingredients business within the Scent segment, and in the fourth quarter of 2023, the Company entered into an agreement to sell its Cosmetic Ingredients business. The transaction is subject to customary closing conditions and is expected to close in the first quarter of 2024. The planned sale does not constitute a strategic shift of the Company’s operations and does not have major effects on the Company’s operations and financial results; therefore, the transaction does not meet the discontinued operations criteria. The Company determined that the assets and liabilities of the business met the criteria to be presented as “held for sale.” As a result, as of September 30, 2023, such assets and liabilities were classified as held for sale and are reported on the Consolidated Balance Sheets. The Company expects that the sale proceeds less costs to sell will exceed the preliminary estimate of the carrying value of the net assets for the business. The carrying value is subject to change based on developments leading up to the closing date. Included in the Company’s Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022 are the following carrying amounts of the assets and liabilities held for sale: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 (2) Assets Cash and cash equivalents $ 23 $ 52 Trade receivables, net 15 85 Inventories 19 157 Property, plant and equipment, net 7 92 Goodwill 267 348 Other intangible assets, net 141 428 Operating lease right-of-use assets 8 13 Other assets 2 25 Total assets held-for-sale $ 482 $ 1,200 Liabilities Accounts payable $ 4 $ 56 Deferred tax liability (1) 25 92 Other liabilities 20 64 Total liabilities held-for-sale $ 49 $ 212 _______________________ (1) The Company is currently analyzing the tax impact of the sale transaction and has included preliminary numbers for the deferred tax liability, which are subject to further updates. (2) The amounts for December 31, 2022 represent the carrying amounts of the portion of the Savory Solutions business and FSI business that were classified as held for sale. The Company completed the divestitures of the businesses on May 31, 2023 and August 1, 2023, respectively. Refer to Note 3 for additional information. |
Restructuring and Other Charges
Restructuring and Other Charges, Net | 9 Months Ended |
Sep. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Other Charges, Net | RESTRUCTURING AND OTHER CHARGES Restructuring and other charges primarily consist of separation costs for employees including severance, outplacement and other employee benefit costs (“Severance”), charges related to the write-down of fixed assets of plants to be closed (“Fixed asset write-down”) and all other related restructuring (“Other”) costs. All restructuring and other charges are separately stated on the Consolidated Statements of Income (Loss) and Comprehensive Loss. Frutarom Integration Initiative In connection with the acquisition of Frutarom, the Company executed an integration plan that, among other initiatives, sought to optimize its manufacturing network (the “Frutarom Integration Initiative”). Since the inception of the initiative through March 31, 2023, the Company closed 22 sites and expensed total costs of approximately $36 million. As of March 31, 2023, the Frutarom Integration Initiative was completed. N&B Merger Restructuring Liability For the nine months ended September 30, 2023, the Company had approximately $2 million of charges related to a lease impairment. Since the inception of the restructuring activities, there have been a total of approximately 215 headcount reductions and the Company has expensed approximately $47 million. 2023 Restructuring Program In December 2022, the Company announced a restructuring program mainly related to headcount reduction to improve its organizational and operating structure, drive efficiencies and achieve cost savings. For the nine months ended September 30, 2023, the Company incurred approximately $63 million of charges related to severance and there have been a total of approximately 605 actual and planned headcount reductions. The Company expects to incur a majority of the costs for the 2023 Restructuring Program in the current year. Changes in Restructuring Liabilities Changes in restructuring liabilities during the nine months ended September 30, 2023 were as follows: (DOLLARS IN MILLIONS) Balance at December 31, 2022 Additional Charges (Reversals), Net Non-Cash Charges Cash Payments Balance at September 30, 2023 Frutarom Integration Initiative Severance $ 4 $ (3) $ — $ (1) $ — Other Restructuring Charges Severance 1 (1) — — — N&B Merger Restructuring Liability Severance 9 — — (8) 1 Other 1 2 (2) (1) — 2023 Restructuring Program Severance — 63 — (39) 24 Total Restructuring and other charges $ 15 $ 61 $ (2) $ (49) $ 25 Restructuring liabilities are presented in “Other current liabilities” on the Consolidated Balance Sheets. Charges by Segment The following table summarizes the total amount of costs incurred in connection with these restructuring programs and activities by segment: Three Months Ended September 30, Nine Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Nourish $ 1 $ — $ 33 $ 3 Health & Biosciences 1 1 12 2 Scent — (5) 14 — Pharma Solutions — — 2 — Total Restructuring and other charges $ 2 $ (4) $ 61 $ 5 |
Property, Plant, and Equipment
Property, Plant, and Equipment | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure | PROPERTY, PLANT AND EQUIPMENT, NET Property, plant and equipment consisted of the following amounts: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 Asset Type Land $ 191 $ 199 Buildings and improvements 1,721 1,697 Machinery and equipment 3,575 3,344 Information technology 386 291 Construction in process 495 649 Total Property, plant and equipment 6,368 6,180 Accumulated depreciation (2,242) (1,977) Total property, plant and equipment, net $ 4,126 $ 4,203 Depreciation expense was $122 million and $111 million for the three months ended September 30, 2023 and 2022, respectively, and $342 million and $345 million for the nine months ended September 30, 2023 and 2022, respectively. Impairment of Property, Plant and Equipment As discussed in Note 1, during the second quarter of 2022, an impairment charge of approximately $28 million was recorded in connection with property, plant and equipment, primarily buildings and improvements, of an asset group that operated primarily in Russia. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets, Net Goodwill and Other Intangible Assets, Net (Notes) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets, Net | GOODWILL AND OTHER INTANGIBLE ASSETS, NET Goodwill Movements in goodwill attributable to each reportable segment for the nine months ended September 30, 2023 were as follows: (DOLLARS IN MILLIONS) Nourish Health & Biosciences Scent Pharma Solutions Total Balance at December 31, 2022 $ 6,050 $ 4,321 $ 1,745 $ 1,239 $ 13,355 Transferred to assets held for sale — — (267) — (267) Reduction from business divestitures (4) — — — (4) Foreign exchange (41) (7) (2) (3) (53) Balance at September 30, 2023 $ 6,005 $ 4,314 $ 1,476 $ 1,236 $ 13,031 The goodwill balances at September 30, 2023 and December 31, 2022 include $2.250 billion of accumulated impairment related to the Health & Biosciences reportable segment. The accumulated impairment relates entirely to an impairment charge recorded in 2022. Impairment of Goodwill For the third quarter of 2022, the Company determined that goodwill impairment triggering events occurred for its Nourish, Health & Biosciences and Pharma Solutions reporting units, which required it to complete an interim impairment assessment. The primary indicators that were deemed to be triggering events in the quarter for the reporting units were declines in the Company’s projections across various reporting units and ongoing adverse macroeconomic impacts such as inflation, increases in interest rates and unfavorable effects from exchange rates. As a result of the triggering events, the Company assessed the fair value of the reporting units using the income approach. Under the income approach, the Company determined the fair value by using a discounted cash flow method at a rate of return that reflected the relative risk of the projected future cash flows of each reporting unit, as well as a terminal value. The Company used the most current actual and forecasted operating data available. Key estimates and assumptions used in these valuations included revenue growth rates, gross margins, EBITDA margins, terminal growth rates and discount rates. These estimates and assumptions were considered Level 3 inputs under the fair value hierarchy. In performing the quantitative impairment test, the Company determined that the fair value of the Nourish and Pharma Solutions reporting units exceeded their carrying value, and determined that there was no impairment of goodwill relating to these reporting units. The Company determined that the carrying value of the Health & Biosciences reporting unit exceeded its fair value and recorded a goodwill impairment charge of $2.250 billion on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the three and nine months ended September 30, 2022. Other Intangible Assets Other intangible assets, net consisted of the following amounts: September 30, December 31, (DOLLARS IN MILLIONS) 2023 2022 Asset Type Customer relationships $ 8,072 $ 8,318 Technological know-how 2,314 2,339 Trade names & patents 331 358 Other 44 47 Total carrying value 10,761 11,062 Accumulated Amortization Customer relationships (1,488) (1,252) Technological know-how (745) (589) Trade names & patents (107) (97) Other (40) (42) Total accumulated amortization (2,380) (1,980) Other intangible assets, net $ 8,381 $ 9,082 Amortization Amortization expense was $170 million and $182 million for the three months ended September 30, 2023 and 2022, respectively, and $513 million and $552 million for the nine months ended September 30, 2023 and 2022, respectively. Amortization expense for the next five years is expected to be as follows: (DOLLARS IN MILLIONS) 2023 2024 2025 2026 2027 Estimated future intangible amortization expense $ 173 $ 692 $ 690 $ 688 $ 589 Impairment of Intangible Assets As discussed in Note 1, during the second quarter of 2022, an impairment charge of approximately $92 million was recorded in connection with intangible assets, primarily customer relationships and technological know-how, of an asset group that operated primarily in Russia. |
Other Assets and Liabilities, C
Other Assets and Liabilities, Current and Noncurrent | 9 Months Ended |
Sep. 30, 2023 | |
Other Assets [Abstract] | |
Other Assets and Liabilities, Current and Noncurrent | OTHER CURRENT ASSETS AND LIABILITIES, AND OTHER ASSETSPrepaid expenses and other current assets consisted of the following amounts: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 Value-added tax receivable $ 159 $ 212 Prepaid income taxes 224 129 Packaging materials and supplies 157 148 Prepaid expenses 184 144 Other 166 137 Total $ 890 $ 770 Other assets consisted of the following amounts: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 Deferred income taxes $ 212 $ 167 Overfunded pension plans 202 180 Cash surrender value of life insurance contracts 46 45 Finance lease right-of-use assets 25 22 Equity method investments 10 10 Other (1) 268 265 Total $ 763 $ 689 _______________________ (1) Includes land usage rights in China, long-term deposits and receivables on certain derivative instruments. Other current liabilities consisted of the following amounts: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 Rebates and incentives payable $ 99 $ 99 Value-added tax payable 62 65 Interest payable 74 55 Current pension and other postretirement benefit obligation 5 10 Accrued insurance (including workers’ compensation) 10 9 Earn outs payable 31 — Accrued restructuring 25 15 Current operating lease obligation 83 86 Accrued freight 12 18 Accrued commissions payable 10 11 Accrued income taxes 118 313 Accrued expenses payable 263 256 Other 145 91 Total $ 937 $ 1,028 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt | DEBT Debt consisted of the following: (DOLLARS IN MILLIONS) Effective Interest Rate September 30, 2023 December 31, 2022 2023 Notes (1) 3.30 % $ — $ 300 2024 Euro Notes (1) 1.88 % 525 532 2025 Notes (1) 1.22 % 1,000 1,000 2026 Euro Notes (1) 1.93 % 836 845 2027 Notes (1) 1.56 % 1,213 1,215 2028 Notes (1) 4.57 % 398 398 2030 Notes (1) 2.21 % 1,509 1,510 2040 Notes (1) 3.04 % 773 774 2047 Notes (1) 4.44 % 495 495 2048 Notes (1) 5.12 % 787 787 2050 Notes (1) 3.21 % 1,570 1,571 2024 Term Loan Facility (2) 6.50 % 570 625 2026 Term Loan Facility (2) 5.41 % 625 625 Revolving Credit Facility (3) — 100 Commercial paper (4) — 187 Bank overdrafts and other — 6 Total debt 10,301 10,970 Less: Short-term borrowings (5) (1,142) (597) Total Long-term debt $ 9,159 $ 10,373 _______________________ (1) Amount is net of unamortized discount and debt issuance costs. (2) Amount is recorded at fair value. (3) The interest rate on the Revolving Credit Facility is, at the applicable borrower’s option, a per annum rate equal to either (x) an eurocurrency rate plus an applicable margin varying from 1.000% to 1.625% or (y) a base rate plus an applicable margin varying from 0.000% to 0.625%, in each case depending on the public debt ratings for non-credit enhanced long-term senior unsecured debt issued by the Company. (4) The effective interest rate of commercial paper issuances fluctuates as short-term interest rates and demand fluctuate, and deferred debt issuance costs are immaterial. Additionally, the effective interest rate of commercial paper is not meaningful as issuances do not materially differ from short-term interest rates. (5) Includes bank borrowings, commercial paper, overdrafts and current portions of long-term debt. Commercial Paper For the nine months ended September 30, 2023, the Company had gross issuances of $4.283 billion and repayments of $4.470 billion under the Commercial Paper Program. The commercial paper issued had original maturities of less than 86 days. For the nine months ended September 30, 2022, the Company had gross issuances of $4.725 billion and repayments of $4.845 billion. The Commercial Paper Program is backed by the borrowing capacity available under the Revolving Credit Facility. The effective interest rate of commercial paper issuances does not materially differ from short-term interest rates, which fluctuate due to market conditions and as a result may impact our interest expense. Amendments to Existing Credit Agreements Amendments to Existing Term Loan Credit Agreement On September 19, 2023, Company entered into Amendment No. 5 (“Term Loan Amendment No. 5”) to amend that certain term loan credit agreement, dated January 17, 2020 (as amended by that certain Amendment No. 1 to Credit Agreement, dated as of August 25, 2020, as further supplemented by that certain Icon Debt Assumption Supplement, dated as of March 4, 2021, as further amended by that certain Amendment No. 2 to Credit Agreement, dated as of August 4, 2022, as further amended by that certain Amendment No. 3 (“Term Loan Amendment No. 3”) to Credit Agreement, dated as of March 23, 2023, as further amended by that certain Amendment No. 4 (“Term Loan Amendment No. 4”) to Credit Agreement, dated as of March 23, 2023, the “Existing Term Loan Credit Agreement”, and the Existing Term Loan Credit Agreement, as amended by the Term Loan Amendment, the “Term Loan Credit Agreement”), among the Company (as successor to Nutrition & Biosciences, Inc.), the lenders party thereto and Morgan Stanley Senior Funding, Inc., as administrative agent. Term Loan Amendment No. 3, among other things, extended the period during which certain relief was provided with respect to the financial covenant contained in the Existing Term Loan Credit Agreement which has been superseded by Term Loan Amendment No. 5. Term Loan Amendment No. 4, among other things, replaces LIBOR with Term SOFR (as defined in the Term Loan Credit Agreement) as the reference rate for U.S. dollar-denominated loans. From March 23, 2023, loans under the Term Loan Credit Agreement now bear interest at a base rate or a rate equal to Term SOFR plus an adjustment of 0.10% per annum, plus, in each case, an applicable margin based on the Company's public debt rating. Loans may be prepaid without premium or penalty, subject to customary breakage costs. Term Loan Amendment No. 5, among other things, extends the period during which certain relief is provided with respect to the financial covenant contained in the Existing Term Loan Credit Agreement through December 31, 2025, or such earlier date on which the Company elects to terminate such period (the “Term Loan Covenant Relief Period”), by providing that during the Term Loan Covenant Relief Period, the Company’s Leverage Ratio (as defined in the Term Loan Credit Agreement) shall not exceed as of the end of the fiscal quarter for the period of the four fiscal quarters then ended: (i) 5.25x for any fiscal quarter ending on or before March 31, 2024, (ii) 4.75x for the fiscal quarter ending June 30, 2024, (iii) 4.50x for the fiscal quarter ending September 30, 2024, (iv) 4.25x for any subsequent fiscal quarter ending on or before March 31, 2025, (v) 4.00x for any subsequent fiscal quarter ending on or before September 30, 2025 and (vi) 3.75x for the fiscal quarter ending December 31, 2025. During the Term Loan Covenant Relief Period, the Term Loan Amendment No. 5 also prohibits the Company from (i) declaring and paying dividends in cash on common stock in excess of $0.81 per share per fiscal quarter (for an aggregate amount of $3.24 per fiscal year) and (ii) creating liens to secure debt in excess of the greater of $300 million and 3.65% of Consolidated Net Tangible Assets (as defined in the Term Loan Credit Agreement), subject to certain exceptions set forth in the Term Loan Amendment No. 5. The Company was in compliance with all covenants as of September 30, 2023. Loans may be prepaid without premium or penalty, subject to customary breakage costs, and during the Term Loan Covenant Relief Period, there will be a mandatory prepayment of the loans with 100% of the net cash proceeds from non-ordinary course asset sales, subject to certain exceptions set forth in the Term Loan Amendment No. 5. The applicable margin for the loans, which is based on the Company’s Public Debt Rating (as defined in the Term Loan Credit Agreement), will also increase by 0.125% for the duration of the Term Loan Covenant Relief Period. Amendments to Existing Revolving Credit Facility On September 19, 2023, the Company and certain of its subsidiaries (collectively, the “Loan Parties”) entered into Amendment No. 4 (the “Revolver Amendment No. 4”) to amend that certain Third Amended and Restated Credit Agreement, dated July 28, 2021 (as amended by that certain Amendment No. 1 to Credit Agreement, dated August 4, 2022, as further amended by that certain Amendment No. 2 (“Revolver Amendment No. 2”) to Credit Agreement, dated as of March 23, 2023, as further amended by that certain Amendment No. 3 (“Revolver Amendment No. 3”) to Credit Agreement, dated as of March 23, 2023, the “Existing Revolving Credit Agreement”, and the Existing Revolving Credit Agreement, as amended by the Revolver Amendment, the “Revolving Credit Agreement”), among the Loan Parties, the lenders party thereto and Citibank, N.A., as administrative agent. Revolver Amendment No. 2, among other things, extended the period during which certain relief was provided with respect to the financial covenant contained in the Existing Revolving Credit Agreement which has been superseded by Revolver Amendment No. 4. Revolver Amendment No. 3, among other things, replaces LIBOR with Term SOFR (as defined in the Revolving Credit Agreement) as the reference rate for U.S. dollar-denominated loans. From March 23, 2023, loans under the Revolving Credit Agreement now bear interest at a base rate or, in the case of U.S. dollar-denominated loans, a rate equal to Term SOFR plus an adjustment of 0.10% per annum or, in the case of euro-denominated loans, the Euro interbank offered rate, plus, in each case, an applicable margin based on the Company’s public debt rating. Loans may be prepaid without premium or penalty, subject to customary breakage costs. Revolver Amendment No. 4, among other things, extends the period during which certain relief is provided with respect to the financial covenant contained in the Existing Revolving Credit Agreement through December 31, 2025, or such earlier date on which the Company elects to terminate such period (the “Revolver Covenant Relief Period”), by providing that during the Revolver Covenant Relief Period, the Company’s Leverage Ratio (as defined in the Revolving Credit Agreement) shall not exceed as of the end of the fiscal quarter for the period of the four fiscal quarters then ended: (i) 5.25x for any fiscal quarter ending on or before March 31, 2024, (ii) 4.75x for the fiscal quarter ending June 30, 2024, (iii) 4.50x for the fiscal quarter ending September 30, 2024, (iv) 4.25x for any subsequent fiscal quarter ending on or before March 31, 2025, (v) 4.00x for any subsequent fiscal quarter ending on or before September 30, 2025 and (vi) 3.75x for the fiscal quarter ending December 31, 2025. During the Revolver Covenant Relief Period, the Revolver Amendment No. 4 also prohibits (i) the Company from declaring and paying dividends in cash on common stock in excess of $0.81 per share per fiscal quarter (for an aggregate amount of $3.24 per fiscal year) and (ii) the Loan Parties from creating liens to secure debt in excess of the greater of $300 million and 3.65% of Consolidated Net Tangible Assets (as defined in the Revolving Credit Agreement), subject to certain exceptions set forth in the Revolver Amendment No. 4. The Company was in compliance with all covenants as of September 30, 2023. Loans may be prepaid without premium or penalty, subject to customary breakage costs, and during the Revolver Covenant Relief Period, the applicable margin for the loans, which is based on the Company’s Public Debt Rating (as defined in the Revolving Credit Agreement), will increase by 0.125%. For the nine months ended September 30, 2023, the Company had issuances of $800 million and repayments of $900 million under the Revolving Credit Facility. For the nine months ended September 30, 2022, the Company had issuances of $350 million and repayments of $350 million. Repayment of Debt On May 1, 2023, the Company made a $300 million debt repayment related to the 2023 Notes at maturity, which was funded from the issuance of $400 million under the Revolving Credit Facility. The issuance under the Revolving Credit Facility was repaid in June 2023. On September 29, 2023, the Company made a voluntary $55 million debt repayment related to the 2024 Term Loan Facility. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Leases | LEASES The Company has leases for corporate offices, manufacturing facilities, research and development facilities and certain transportation and office equipment. The Company’s leases have remaining lease terms of up to 50 years, some of which include options to extend the leases for up to 15 years. The components of lease expense were as follows: Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended (DOLLARS IN MILLIONS) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Operating leases Operating lease cost $ 32 $ 31 $ 105 $ 99 Variable lease cost 10 12 42 36 Total operating lease cost $ 42 $ 43 $ 147 $ 135 Finance leases Finance lease cost $ 3 $ 2 $ 7 $ 6 Supplemental cash flow information related to leases was as follows: Nine Months Ended Nine Months Ended (DOLLARS IN MILLIONS) September 30, 2023 September 30, 2022 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows for operating leases $ 94 $ 102 Operating cash flows for finance leases 1 — Financing cash flows for finance leases 6 5 Right-of-use assets obtained in exchange for lease obligations Operating leases 73 154 Finance leases 17 4 Operating lease right-of-use assets are presented in “Operating lease right-of-use assets” and finance lease right-of-use assets are presented in “Other assets” on the Consolidated Balance Sheets. Operating lease liabilities are presented in “Operating lease liabilities” and finance lease liabilities are presented in “Other liabilities” on the Consolidated Balance Sheets. Any other current liabilities related to operating and finance lease liabilities are presented in “Other current liabilities” on the Consolidated Balance Sheets. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The effective tax rate for the three months ended September 30, 2023 was 54.2%, which was primarily driven by tax expenses relating to business divestitures and changes in the mix of income and losses, some of which do not give rise to tax benefits due to valuation allowances. The effective tax rate for the nine months ended September 30, 2023 was 62.6%, which was primarily driven by tax expenses relating to business divestitures and changes in the mix of income and losses, some of which do not give rise to tax benefits due to valuation allowances. As of September 30, 2023, the Company had approximately $111 million of unrecognized tax benefits recorded in Other liabilities and approximately $5 million recorded to Other current liabilities. If these unrecognized tax benefits were recognized, the effective tax rate would be affected. As of September 30, 2023, the Company had accrued interest and penalties of approximately $38 million classified in Other liabilities and approximately $2 million classified in Other current liabilities. As of September 30, 2023, the Company’s aggregate provisions for uncertain tax positions, including interest and penalties, was approximately $156 million associated with tax positions asserted in various jurisdictions. The Company regularly repatriates earnings from non-U.S. subsidiaries. As the Company repatriates these funds to the U.S., they will be required to pay income taxes in certain U.S. states and applicable foreign withholding taxes during the period when such repatriation occurs. Accordingly, as of September 30, 2023, the Company had a deferred tax liability of approximately $153 million for the effect of repatriating the funds to the U.S., attributable to various non-U.S. subsidiaries. There is no deferred tax liability associated with non-U.S. subsidiaries where we intend to indefinitely reinvest the earnings to fund local operations and/or capital projects. |
Stock Compensation Plans
Stock Compensation Plans | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Compensation Plans | STOCK COMPENSATION PLANSThe Company has various plans under which its officers, senior management, other key employees and directors may be granted equity-based awards. Equity awards outstanding under the plans include PRSUs, Restricted Stock Units (“RSUs”), Stock-Settled Appreciation Rights (“SSARs”) and Long-Term Incentive Plan awards. Liability-based awards outstanding under the plans are cash-settled RSUs. Stock-based compensation expense and related tax benefits were as follows: Three Months Ended September 30, Nine Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Equity-based awards $ 18 $ 12 $ 50 $ 37 Liability-based awards — (1) — — Total stock-based compensation expense 18 11 50 37 Less: Tax benefit (5) (2) (11) (7) Total stock-based compensation expense, after tax $ 13 $ 9 $ 39 $ 30 As of September 30, 2023, there was approximately $90 million of total unrecognized compensation cost related to non-vested awards granted under the equity incentive plans. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION The Company is organized into four reportable operating segments: Nourish, Health & Biosciences, Scent and Pharma Solutions. These segments align with the internal structure to manage these businesses. The Company’s Chief Operating Decision Maker regularly reviews financial information to allocate resources and assess performance utilizing these segments. Nourish is comprised of three business units, Ingredients, Flavors and Food Designs, with a diversified portfolio across natural and plant-based specialty food ingredients, flavor compounds, and systems and inclusions, respectively. Ingredients provide texturizing solutions to the food industry, food protection solutions used in food and beverage products, specialty soy and pea protein with value-added formulations, emulsifiers and sweeteners. Flavors provide a range of flavor compounds and natural taste solutions that are ultimately used by IFF’s customers in savory products, beverages, sweets and dairy products. Flavors also provide value-added spices and seasoning ingredients for meat, food service, convenience, alternative protein and culinary products. Food Designs provide blends and systems that combine key ingredients tailored to IFF customers’ specific needs. Additionally, Food Designs provide inclusion products that help with taste and texture by, among other things, combining flavorings with fruit, vegetables, and other natural ingredients for a wide range of food products, such as health snacks, baked goods, cereals, pastries, ice cream and other dairy products. Health & Biosciences is comprised of five business units, Health, Cultures & Food Enzymes, Home & Personal Care, Animal Nutrition and Grain Processing, with a biotechnology-driven portfolio of products that serve the health and wellness, food, consumer and industrial markets. Products within this portfolio range from enzymes, food cultures, probiotics and specialty ingredients for non-food applications. Health provides ingredients for dietary supplements, food and beverage, specialized nutrition and pharma. Cultures & Food Enzymes provide products that aim to serve the global demand for healthy, natural, clean label and fermented food for fresh dairy, cheese, bakery and brewing products. This is accomplished by providing IFF’s customers with products that allow for extended shelf life and stability, which help to improve customers’ products and performance. The business unit’s enzyme solution also allows IFF’s customers to provide low sugar, high fiber and lactose-free dairy products. Home & Personal Care produces enzymes for detergents, cleaning and textile processing products in the laundry, dishwashing, textiles and industrials and personal care markets that help to enhance product and process performances. Animal Nutrition produces enzymes that help to improve the product and process performance of animal feed products, which aim to lessen environmental impact by reducing farm waste. Grain Processing produces enzymes for biofuel production and carbohydrate processing. Scent is comprised of (1) Fragrance Compounds, which are ultimately used by IFF’s customers in two broad categories: Fine Fragrances, including perfumes and colognes, and Consumer Fragrances, including fragrance compounds for personal care (e.g., soaps), household products (e.g., detergents and cleaning agents) and beauty care, including toiletries; (2) Fragrance Ingredients, consisting of synthetic and natural ingredients that can be combined with other materials to create unique fine fragrance and consumer fragrance compounds; and (3) Cosmetic Ingredients, consisting of active and functional ingredients, botanicals and delivery systems to support our customers’ cosmetic and personal care product lines. Major fragrance customers include the cosmetics industry, including perfume and toiletries manufacturers, and the household products industry, including manufacturers of soaps, detergents, fabric care, household cleaners and air fresheners. Pharma Solutions is comprised of a vast portfolio, including cellulosics and seaweed-based pharmaceutical excipients, used to improve the functionality and delivery of active pharmaceutical ingredients, including controlled or modified drug release formulations, and enabling the development of more effective pharmaceutical finished dosage formats. Pharma Solutions excipients are used in prescription and over-the-counter pharmaceuticals and dietary supplements. Pharma Solutions products also serve a variety of other specialty and industrial end-uses including coatings, inks, electronics, agriculture and consumer products. Reportable segment information was as follows: Three Months Ended Nine Months Ended September 30, September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Net sales: Nourish $ 1,449 $ 1,703 $ 4,666 $ 5,252 Health & Biosciences 518 512 1,553 1,838 Scent 615 591 1,815 1,756 Pharma Solutions 238 257 742 750 Consolidated $ 2,820 $ 3,063 $ 8,776 $ 9,596 Segment Adjusted Operating EBITDA: Nourish $ 178 $ 287 $ 567 $ 981 Health & Biosciences 150 137 426 513 Scent 131 119 353 328 Pharma Solutions 47 69 173 192 Total 506 612 1,519 2,014 Depreciation & Amortization (292) (293) (855) (897) Interest Expense (110) (83) (337) (232) Other Income, net 19 33 34 43 Restructuring and Other Charges (a) (2) 4 (61) (5) Impairment of Goodwill (b) — (2,250) — (2,250) Impairment of Long-Lived Assets (c) — — — (120) Acquisition, Divestiture and Integration Related Costs (d) (42) (57) (118) (167) Strategic Initiatives Costs (e) (6) (1) (28) (1) Regulatory Costs (f) (13) — (32) — Other (g) (1) — 1 (5) Income (Loss) Before Taxes $ 59 $ (2,035) $ 123 $ (1,620) _______________________ (a) For 2023 and 2022, represents costs primarily related to severance as part of the Company's restructuring efforts. (b) Represents costs related to the impairment of goodwill in the Health & Biosciences reporting unit. (c) Represents costs related to the impairment of intangible and fixed assets of an asset group that operated primarily in Russia. (d) For 2023 and 2022, primarily represents costs related to the Company's actual and planned acquisitions and divestitures and integration related activities primarily for N&B. These costs primarily consisted of external consulting fees, professional and legal fees and salaries of individuals who are fully dedicated to such efforts. For 2023, acquisition costs primarily relate to earn-out adjustments. For the three months ended September 30, 2023, business divestiture, integration and acquisition related costs were approximately $29 million, $12 million and $1 million, respectively. For the three months ended September 30, 2022, business divestiture, integration and acquisition related costs were approximately $31 million, $25 million and $1 million, respectively. For the nine months ended September 30, 2023, business divestiture, integration and acquisition related costs were approximately $70 million, $42 million and $6 million, respectively. For the nine months ended September 30, 2022, business divestiture, integration and acquisition related costs were approximately $91 million, $73 million and $3 million, respectively. (e) Represents costs related to the Company's strategic assessment and business portfolio optimization efforts and reorganizing the Global Shared Services Centers, primarily consulting fees. (f) Represents costs primarily related to legal fees incurred for the ongoing investigations of the fragrance businesses. (g) For 2023, represents (losses) gains from sale of assets. For 2022, represents shareholder activist related costs, primarily professional fees, severance costs, including accelerated stock compensation expense, for certain executives who have been separated from the Company, and gains from sale of assets. Net sales, which are attributed to individual regions based upon the destination of product delivery, were as follows: Three Months Ended September 30, Nine Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Europe, Africa and Middle East $ 918 $ 1,030 $ 2,958 $ 3,258 Greater Asia 670 701 2,031 2,200 North America 853 939 2,668 3,006 Latin America 379 393 1,119 1,132 Consolidated $ 2,820 $ 3,063 $ 8,776 $ 9,596 Three Months Ended September 30, Nine Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Net sales related to the U.S. $ 782 $ 920 $ 2,430 $ 2,799 Net sales attributed to all foreign countries 2,038 2,143 6,346 6,797 No non-U.S. country had net sales greater than 7% of total consolidated net sales for the three and nine months ended September 30, 2023. No non-U.S. country had net sales greater than 6% of total consolidated net sales for the three and nine months ended September 30, 2022. |
Employee Benefits
Employee Benefits | 9 Months Ended |
Sep. 30, 2023 | |
Retirement Benefits [Abstract] | |
Employee Benefits | EMPLOYEE BENEFITS Pension and other defined contribution retirement plan expenses included the following components: (DOLLARS IN MILLIONS) U.S. Plans Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Service cost for benefits earned (1) $ — $ 1 $ — $ 1 Interest cost on projected benefit obligation (2) 6 4 19 12 Expected return on plan assets (2) (7) (5) (23) (16) Net amortization and deferrals (2) — 1 1 5 Net periodic benefit (income) cost $ (1) $ 1 $ (3) $ 2 (DOLLARS IN MILLIONS) Non-U.S. Plans Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Service cost for benefits earned (1) $ 5 $ 9 $ 15 $ 28 Interest cost on projected benefit obligation (2) 9 4 27 13 Expected return on plan assets (2) (11) (10) (34) (32) Net amortization and deferrals (2) — 3 (1) 9 Net periodic benefit (income) cost $ 3 $ 6 $ 7 $ 18 _______________________ (1) Included as a component of Operating profit (loss). (2) Included as a component of Other income, net. The Company expects to contribute a total of $5 million to its U.S. pension plans and a total of $32 million to its non-U.S. pension plans during 2023. During the nine months ended September 30, 2023, no contributions were made to the qualified U.S. pension plans, $22 million of contributions were made to the non-U.S. pension plans, and $3 million of benefit payments were made with respect to the Company’s non-qualified U.S. pension plan. (Income) expense recognized for postretirement benefits other than pensions included the following components: Three Months Ended September 30, Nine Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Service cost for benefits earned $ — $ 1 $ — $ 1 Interest cost on projected benefit obligation — — 2 1 Net amortization and deferrals (1) (2) (4) (4) Total postretirement benefit (income) expense $ (1) $ (1) $ (2) $ (2) The Company expects to contribute $3 million to its postretirement benefits other than pension plans during 2023. In the nine months ended September 30, 2023, $2 million of contributions were made. |
Financial Instruments
Financial Instruments | 9 Months Ended |
Sep. 30, 2023 | |
Investments, All Other Investments [Abstract] | |
Financial Instruments | FINANCIAL INSTRUMENTS Fair Value Accounting guidance on fair value measurements specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs create the following fair value hierarchy: • Level 1 — Quoted prices for identical instruments in active markets. • Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. • Level 3 — Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable . This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. The Company also considers counterparty credit risk in its assessment of fair value. The Company determines the fair value of structured liabilities (where performance is linked to structured interest rates, inflation or currency risks) using the Term SOFR swap curve and forward interest and exchange rates at period end. Such instruments are classified as Level 2 based on the observability of significant inputs to the model. The Company does not have any instruments classified as Level 3, other than those included in pension asset trusts as discussed in Note 15 of the Company’s 2022 Form 10-K. The carrying values and the estimated fair values of financial instruments at September 30, 2023 and December 31, 2022 consisted of the following: September 30, 2023 December 31, 2022 (DOLLARS IN MILLIONS) Carrying Value Fair Value Carrying Value Fair Value LEVEL 1 Cash and cash equivalents (1) $ 629 $ 629 $ 483 $ 483 LEVEL 2 Credit facilities and bank overdrafts (2) — — 106 106 Derivatives Derivative assets (3) 3 3 1 1 Derivative liabilities (3) 126 126 75 75 Commercial paper (2) — — 187 187 Long-term debt: 2023 Notes (4) — — 300 298 2024 Euro Notes (4) 525 518 532 519 2025 Notes (4) 1,000 897 1,000 884 2026 Euro Notes (4) 836 757 845 774 2027 Notes (4) 1,213 995 1,215 1,006 2028 Notes (4) 398 367 398 380 2030 Notes (4) 1,509 1,130 1,510 1,188 2040 Notes (4) 773 468 774 535 2047 Notes (4) 495 336 495 390 2048 Notes (4) 787 598 787 685 2050 Notes (4) 1,570 874 1,571 1,021 2024 Term Loan Facility (5) 570 570 625 625 2026 Term Loan Facility (5) 625 625 625 625 _______________________ (1) The carrying amount of cash and cash equivalents approximates fair value due to the short maturity of those instruments. (2) The carrying amount approximates fair value as the interest rate is reset frequently based on current market rates as well as the short maturity of those instruments. (3) The carrying amount approximates fair value as the instruments are marked-to-market and held at fair value on the Consolidated Balance Sheets. (4) The fair value of the Note is obtained from pricing services engaged by the Company, and the Company receives one price for each security. The fair value provided by the pricing services are estimated using pricing models, where the inputs to those models are based on observable market inputs or recent trades of similar securities. The inputs to the valuation techniques applied by the pricing services are typically benchmark yields, benchmark security prices, credit spreads, reported trades and broker-dealer quotes, all with reasonable levels of transparency. (5) The carrying amount approximates fair value as the Term Loans were assumed at fair value and the interest rate is reset frequently based on current market rates. Derivatives Foreign Currency Forward Contracts The Company periodically enters into foreign currency forward contracts with the objective of reducing exposure to cash flow volatility associated with its intercompany loans and foreign currency receivables and payables. These contracts generally involve the exchange of one currency for a second currency at a future date, have maturities not exceeding twelve months and are with counterparties which are major international financial institutions. Commodity Contracts The Company utilizes options, futures and swaps that are not designated as hedging instruments to reduce exposure to commodity price fluctuations on purchases of inventory such as soybeans, soybean oil and soybean meal. The Company also utilizes options, futures and swaps that are designated as hedging instruments to reduce exposure to commodity price fluctuations on purchases of natural gas used in our manufacturing process. Hedges Related to Issuances of Debt As of September 30, 2023, the Company designated approximately $1.361 billion of Euro Notes as a hedge of a portion of its net European investments. Accordingly, the change in the value of the debt that is attributable to foreign exchange movements is recorded in other comprehensive income (“OCI”) as a component of foreign currency translation adjustments in the accompanying Consolidated Statements of Income (Loss) and Comprehensive Loss. Cross Currency Swaps The Company has twelve EUR/USD cross currency swaps with a notional value of $1.400 billion that mature through November 2030. The swaps all qualified as net investment hedges in order to mitigate a portion of the Company’s net European investments from foreign currency risk. As of September 30, 2023, the twelve swaps were in a liability position with an aggregate fair value of $89 million, which were classified as Other liabilities on the Consolidated Balance Sheets. Changes in fair value related to cross currency swaps are recorded in OCI. The following table shows the notional amount of the Company’s derivative instruments outstanding as of September 30, 2023 and December 31, 2022: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 Foreign currency contracts (1) $ (1,248) $ 92 Commodity contracts (1) 13 (1) Cross currency swaps 1,400 1,400 _______________________ (1) Foreign currency contracts and commodity contracts are presented net of contracts bought and sold. The following tables show the Company’s derivative instruments measured at fair value (Level 2 of the fair value hierarchy), as reflected on the Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022: September 30, 2023 (DOLLARS IN MILLIONS) Fair Value of Fair Value of Total Fair Value Derivative assets (1) Foreign currency contracts $ — $ 3 $ 3 Derivative liabilities (2) Foreign currency contracts $ — $ 37 $ 37 Cross currency swaps 89 — 89 Total derivative liabilities $ 89 $ 37 $ 126 December 31, 2022 (DOLLARS IN MILLIONS) Fair Value of Fair Value of Total Fair Value Derivative assets (1) Foreign currency contracts $ — $ 1 $ 1 Derivative liabilities (2) Cross currency swaps $ 75 $ — $ 75 _______________________ (1) Derivative assets are recorded to Prepaid expenses and other current assets on the Consolidated Balance Sheets. (2) Derivative liabilities are recorded to Other current liabilities and Other liabilities on the Consolidated Balance Sheets. The following table shows the effect of the Company’s derivative instruments which were not designated as hedging instruments on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the three and nine months ended September 30, 2023 and 2022: Amount of Gain (Loss) Location of Gain (Loss) Recognized in Income on Derivative (DOLLARS IN MILLIONS) Three Months Ended September 30, 2023 2022 Foreign currency contracts (1) $ (26) $ 2 Other income, net Amount of Gain (Loss) Location of Gain (Loss) Recognized in Income on Derivative (DOLLARS IN MILLIONS) Nine Months Ended September 30, 2023 2022 Foreign currency contracts (1) $ (23) $ 4 Other income, net Commodity contracts 2 — Cost of goods sold Total $ (21) $ 4 _______________________ (1) The foreign currency contract net gains (losses) offset any recognized gains (losses) arising from the revaluation of the related intercompany loans during the same respective periods. The following table shows the effect of the Company’s derivative and non-derivative instruments designated as net investment hedging instruments, net of tax, on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the three and nine months ended September 30, 2023 and 2022: Amount of Gain (Loss) Location of Gain (Loss) Amount of Gain (Loss) Three Months Ended September 30, Three Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Derivatives in Net Investment Hedging Relationships: Cross currency swaps $ 22 $ (36) N/A $ — $ — Non-Derivatives in Net Investment Hedging Relationships: 2024 Euro Notes 15 30 N/A — — 2026 Euro Notes 25 48 N/A — — Total $ 62 $ 42 $ — $ — Amount of Gain (Loss) Location of Gain (Loss) Amount of Gain (Loss) Nine Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Derivatives in Net Investment Hedging Relationships: Cross currency swaps $ (11) $ 12 N/A $ — $ — Non-Derivatives in Net Investment Hedging Relationships: 2024 Euro Notes 4 60 N/A — — 2026 Euro Notes 7 96 N/A — — Total $ — $ 168 $ — $ — The ineffective portion of the above noted net investment hedges was not material and was recorded as a component of interest expense on the Consolidated Statements of Income (Loss) and Comprehensive Loss during the three and nine months ended September 30, 2023 and 2022. At September 30, 2023, based on current market rates, the Company does not expect any derivative losses (net of tax), included in AOCI, to be reclassified into earnings within the next 12 months. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | ACCUMULATED OTHER COMPREHENSIVE LOSS The following tables present changes in the accumulated balances for each component of other comprehensive (loss) income, including current period other comprehensive (loss) income and reclassifications out of accumulated other comprehensive loss: (DOLLARS IN MILLIONS) Foreign Gains (Losses) Pension and Total Accumulated other comprehensive (loss) income, net of tax, as of December 31, 2022 $ (2,066) $ 1 $ (133) $ (2,198) OCI before reclassifications (175) — (2) (177) Reclassifications due to business divestitures 43 — (1) 42 Amounts reclassified from AOCI — — (3) (3) Net current period other comprehensive income (loss) (132) — (6) (138) Accumulated other comprehensive (loss) income, net of tax, as of September 30, 2023 $ (2,198) $ 1 $ (139) $ (2,336) (DOLLARS IN MILLIONS) Foreign Gains (Losses) Pension and Total Accumulated other comprehensive (loss) income, net of tax, as of December 31, 2021 $ (1,133) $ 1 $ (291) $ (1,423) OCI before reclassifications (1,770) — (2) (1,772) Amounts reclassified from AOCI — — 8 8 Net current period other comprehensive income (loss) (1,770) — 6 (1,764) Accumulated other comprehensive (loss) income, net of tax, as of September 30, 2022 $ (2,903) $ 1 $ (285) $ (3,187) The following table provides details about reclassifications out of Accumulated other comprehensive loss to the Consolidated Statements of Income (Loss) and Comprehensive Loss: Nine Months Ended September 30, Affected Line Item in the Consolidated Statements of Income (Loss) and Comprehensive Loss (DOLLARS IN MILLIONS) 2023 2022 Gains (losses) on pension and postretirement liability adjustments Prior service cost $ 4 $ 5 (1) Actuarial losses — (15) (1) Tax (1) 2 Provision for income taxes Total $ 3 $ (8) Total, net of income taxes _______________________ (1) The amortization of prior service cost and actuarial loss is included in the computation of net periodic benefit cost. Refer to Note 15 of the Company’s 2022 Form 10-K for additional information regarding net periodic benefit cost. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Guarantees and Letters of Credit The Company has various bank guarantees, letters of credit and surety bonds which are used to support its ongoing business operations, satisfy governmental requirements associated with pending litigation in various jurisdictions and the payment of customs duties. As of September 30, 2023, the Company had a total capacity of approximately $431 million of bank guarantees, commercial guarantees, standby letters of credit and surety bonds with various financial institutions. Included in the above aggregate amount was a total of approximately $10 million for other assessments in Brazil for various income tax and indirect tax disputes related to fiscal years 1998-2011. There was a total of approximately $91 million outstanding under the bank guarantees, standby letters of credit and commercial guarantees as of September 30, 2023. In order to challenge the assessments in these cases in Brazil, the Company has been required to, and has separately pledged assets, principally property, plant and equipment, to cover assessments in the amount of approximately $8 million as of September 30, 2023. Lines of Credit The Company has various lines of credit which are available to support its ongoing business operations. As of September 30, 2023, the Company had a total capacity of approximately $1.824 billion of lines of credit with various financial institutions, in addition to the $1.447 billion of capacity under the Revolving Credit Facility. Pursuant to these lines of credit as of September 30, 2023, the total draw downs were not material. Litigation The Company assesses contingencies related to litigation and/or other matters to determine the degree of probability and range of possible loss. A loss contingency is accrued in the Company’s Consolidated Financial Statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because litigation is inherently unpredictable and unfavorable resolutions could occur, assessing contingencies is highly sensitive and requires judgments about future events. On at least a quarterly basis, the Company reviews contingencies related to litigation to determine the adequacy of accruals. The amount of ultimate loss may differ from these estimates and further events may require the Company to increase or decrease the amounts it has accrued on any matter. Periodically, the Company assesses its insurance coverage for all known claims, where applicable, taking into account aggregate coverage by occurrence, limits of coverage, self-insured retentions and deductibles, historical claims experience and claims experience with its insurance carriers. The liabilities are recorded at management’s best estimate of the probable outcome of the lawsuits and claims, taking into consideration the facts and circumstances of the individual matters as well as past experience on similar matters. At each balance sheet date, the key issues that management assesses are whether it is probable that a loss as to asserted or unasserted claims has been incurred and if so, whether the amount of loss can be reasonably estimated. The Company records the expected liability with respect to claims in Other liabilities and expected recoveries from its insurance carriers in Other assets. The Company recognizes a receivable when it believes that realization of the insurance receivable is probable under the terms of the insurance policies and its payment experience to date. Litigation Matters On August 12, 2019, Marc Jansen filed a putative securities class action against IFF, its then Chairman and CEO, and its then-CFO, in the United States District Court for the Southern District of New York. The lawsuit was filed after IFF disclosed that preliminary results of investigations indicated that Frutarom businesses operating principally in Russia and Ukraine had made improper payments to representatives of customers. On March 16, 2020, an amended complaint was filed, which added Frutarom and certain former officers of Frutarom as defendants. The amended complaint alleges, among other things, that defendants made materially false and misleading statements or omissions concerning IFF’s acquisition of Frutarom, the integration of the two companies, and the companies’ financial reporting and results. The amended complaint asserts claims under Section 10(b) of the Securities Exchange Act of 1934 and SEC Rule 10b-5, and under the Israeli Securities Act-1968, against all defendants, and under Section 20(a) of the Securities Exchange Act of 1934 against the individual defendants, on behalf of a putative class of persons and entities who purchased or otherwise acquired IFF securities on the New York Stock Exchange between May 7, 2018 and August 12, 2019 and persons and entities who purchased or otherwise acquired IFF securities on the Tel Aviv Stock Exchange between October 9, 2018 and August 12, 2019. The amended complaint seeks an award of unspecified compensatory damages, costs, and expenses. IFF, its officers, and Frutarom filed a motion to dismiss the case on June 26, 2020, which was granted on March 30, 2021. On April 28, 2021, lead plaintiffs filed a notice of appeal to the United States Court of Appeals for the Second Circuit. Lead plaintiffs are pursuing the appeal only against Frutarom and certain former officers of Frutarom. The parties have submitted their briefs to the Court of Appeals. The Second Circuit held oral argument on February 10, 2022. On September 30, 2022, the Second Circuit affirmed the dismissal of Plaintiffs’ claims. On October 14, 2022, Plaintiffs filed a Petition for Rehearing En Banc, which the Second Circuit denied on January 4, 2023. Plaintiffs did not seek review in the United States Supreme Court. The matter is therefore fully resolved in defendants’ favor. Two motions to approve securities class actions were filed in the Tel Aviv District Court, Israel, in August 2019, similarly alleging, among other things, false and misleading statements largely in connection with IFF’s acquisition of Frutarom and the above-mentioned improper payments. One motion (“Borg”) asserts claims under the U.S. federal securities laws against IFF, its former Chairman and CEO, and its former CFO. On November 8, 2020, IFF and its officers filed their response to the Borg motion. On April 20, 2021, Mr. Borg filed a motion to stay the proceeding pending an appellate decision in the U.S. proceeding. On June 15, 2021, August 11, 2021, November 9, 2021, January 9, 2022, April 7, 2022 and July 10, 2022, the U.S. lead plaintiffs filed update notices with the Israeli court regarding the appeal in the U.S. proceeding. On June 12, 2023, the petitioner filed a withdrawal motion, which the court then granted. The Borg case is now dismissed. The other motion (“Oman”) (following an initial amendment) asserted claims under the Israeli Securities Act-1968 against IFF, its former Chairman and CEO, and its former CFO, and against Frutarom and certain former Frutarom officers and directors, as well as claims under the Israeli Companies Act-1999 against certain former Frutarom officers and directors. On February 17, 2021, the court granted a motion by the Oman plaintiff to remove IFF and its officers from the motion and to add factual allegations from the US amended complaint. The amended Oman motion was filed on July 4, 2021. On August 29, 2021, the former Frutarom officers and certain former Frutarom directors filed a motion to dismiss the case. On September 30, 2021, Frutarom notified the court that it joins the legal arguments made in the motion to dismiss. On February 22, 2022, the court denied the motion to dismiss. On July 14, 2022, the court approved the parties’ motion to mediate the dispute, which postpones all case deadlines until after the mediation. In addition, a request to appeal the court’s denial of the motion to dismiss filed by the former Frutarom officers and certain former Frutarom directors has been stayed. The parties held mediation meetings on September 13, 2022, November 22, 2022 and March 1, 2023. On October 29, 2019, IFF and Frutarom filed a claim in the Tel Aviv District Court, Israel, against Ori Yehudai, the former President and CEO of Frutarom, and against certain former directors of Frutarom, challenging the bonus of US $20 million granted to Yehudai in 2018. IFF and Frutarom allege, among other things, that Yehudai was not entitled to receive the bonus because he breached his fiduciary duty by, among other things, knowing of the above-mentioned improper payments and failing to prevent them from being made. The parties agreed, pursuant to the court’s recommendation, to attempt to resolve the dispute through mediation, and a court decision is pending with regard to the order in which this claim and the class action described below will be heard. On March 11, 2020, an IFF shareholder filed a motion to approve a class action in Israel against, among others, Frutarom, Yehudai, and Frutarom’s former board of directors, alleging that former minority shareholders of Frutarom were harmed as a result of the US $20 million bonus paid to Yehudai. The parties to this motion agreed to attempt to resolve the dispute through mediation to take place regarding the aforesaid claim against Yehudai. On July 27, 2021, counsel to the movant in the class action filed a notice with the court that the mediation process ended without an agreement. On August 26, 2021, a motion to dismiss the class action application was filed by Yehudai and certain former directors of Frutarom. On September 9, 2021, an additional motion to dismiss was filed by other former directors of Frutarom together with ICC Industries, Inc. and its affiliates. On December 9, 2021, the court denied the motions to dismiss. Responses to the class action motion were filed in May 2022, and applicant’s response was filed in December 2022. An evidentiary hearing is set for March 2024. Since March 2023, various putative class action lawsuits have been filed against IFF, Firmenich International SA, Givaudan SA, and Symrise AG and/or certain affiliates thereof in the Quebec Superior Court, the Federal Court of Canada, Ontario Superior Court, Supreme Court of British Columbia and, in several cases, the United States District Court for the District of New Jersey. These actions allege violations of the Canadian Competition Act and the Sherman Act, as applicable, and other related claims, and seek damages and other relief. IFF may face additional civil suits, in the United States or elsewhere, relating to such alleged conduct. At this time, IFF is unable to predict the potential outcome of these lawsuits or any potential effect they may have on the Company’s results of operations, liquidity or financial condition. Investigations On June 3, 2020, the Israel Police’s National Fraud Investigation Unit and the Israeli Securities Authority commenced an investigation into Frutarom and certain of its former executives, based on suspected bribery of foreign officials, money laundering, and violations of the Israeli Securities Act-1968. As part of the investigation, the National Fraud Investigation Unit and the Israeli Securities Authority have provided IFF and Frutarom with various orders, mainly requesting that IFF and Frutarom provide certain documents and materials. In addition, a seizure of assets was imposed on Frutarom and certain of its affiliates. IFF has been working to ensure compliance with such orders, all in accordance with, and subject to, Israeli law. On August 25, 2021, the Israeli Police informed Frutarom that they have decided to remove the temporary criminal seizure of assets order from the real estate assets of Frutarom and its related companies, which was done in parallel with the transfer of the case to the District Attorney’s Office in Israel. On March 7, 2023, the European Commission (“EC”) and the United Kingdom Competition and Markets Authority (“CMA”) carried out unannounced inspections of certain of IFF’s facilities. On the same day, IFF was served with a grand jury subpoena by the Antitrust Division of the U.S. Department of Justice (“DOJ”). IFF understands the EC, CMA, DOJ and the Swiss Competition Commission to be investigating potential anticompetitive conduct as it relates to IFF’s fragrance businesses. IFF has been and intends to continue cooperating with these investigations. IFF is unable, however, to predict or determine at this time the duration or outcome of the investigations, or whether the outcome of the investigations will materially impact the Company’s results of operations, liquidity or financial condition. China Facilities Guangzhou Taste Plant During the fourth quarter of 2016, the Company was notified that certain governmental authorities had begun to evaluate a change in the zoning of the Guangzhou Taste plant. The zoning, if changed, would not affect the current operations, but would prevent expansions or other increases in the operating capacity of the plant. The ultimate outcome of any change that the governmental authorities may propose, the timing of such a change, and the nature of any compensation arrangements that might be provided to the Company are uncertain. To address the governmental authorities’ requirements, the Company has transferred certain production capabilities from the Guangzhou Taste plant to a newly built facility in Zhangjiagang. Currently, the Company does not foresee the need for expansions of the Guangzhou Taste plant. The net book value of the Guangzhou and Zhangjiagang Taste plants was approximately $47 million and $34 million, respectively, as of September 30, 2023. Guangzhou Scent Plant During the second quarter of 2019, the Company was notified that certain governmental authorities had changed the zoning where the Guangzhou Scent plant is located. The zoning change did not affect the current operations but prevents expansions or other increases in the operating capacity of the plant. The Company believes that it is possible that the zoning may be enforced in the future such that it would not be able to continue manufacturing at the existing site. The ultimate outcome of any change that the governmental authorities may propose, the timing of such a change, and the nature of any compensation arrangements that might be provided to the Company are uncertain. To address the governmental authorities’ requirements, the Company has transferred certain production capabilities from the Guangzhou Scent plant to the plant in Jiande, China. The net book value of the Guangzhou Scent plant and the plant in Jiande, China was approximately $6 million and $53 million, respectively, as of September 30, 2023. Zhejiang Ingredients Plant In the fourth quarter of 2017, the Company concluded discussions with the government regarding the relocation of its Fragrance Ingredients plant in Zhejiang and, based on the agreements reached, expected to receive total compensation payments up to approximately $50 million. The relocation compensation was paid to the Company over the period of the relocation. The Company received payments totaling $30 million through the end of 2019. Production at the facility ceased during 2019. In the second quarter of 2020, the Company transferred ownership of the site to the government and the remaining net book value of the plant was written off. In the third quarter of 2020, the Company received a payment of approximately $13 million. The land remediation activities were completed in November 2022 and the final land restoration activities to restore the land to its original height, per the government’s request, were completed in April 2023. Upon completion of these activities, the land was returned to the government in April 2023 and a final payment of approximately $5 million was received in June 2023. During the second quarter of 2023, the Company recognized a pre-tax gain of approximately $22 million related to this transaction presented in Other income, net on the Consolidated Statements of Income (Loss) and Comprehensive Loss. The Company also recognized an estimated amount of approximately $6 million of income taxes presented in Provision for income taxes on the Consolidated Statements of Income (Loss) and Comprehensive Loss. The calculation of the applicable income taxes related to this transaction has been sent to the local tax authorities for review and is pending final approval. Total China Operations The total net book value of all plants in China was approximately $209 million as of September 30, 2023. If the Company is required to close a plant, or operate one at significantly reduced production levels on a permanent basis, the Company may be required to record charges that could have a material impact on its consolidated financial results of operations, financial position and cash flows in future periods. Environmental Proceedings The Company is reporting the following environmental matter in compliance with SEC requirements to disclose environmental proceedings where a governmental authority is a party and that involve potential monetary sanctions of $300,000 or greater. On May 27, 2022, the Solae, LLC Memphis site (“Solae”) was served an Administrative Order and Assessment (the “Order”) by the City of Memphis related to alleged wastewater discharge violations. Solae submitted an appeal of the Order on June 24, 2022. Discussions with the City regarding potential resolution of the violations and penalties related to said violations are ongoing. Additionally, the Solae facility has undertaken capital project efforts, some of which began prior to the issuance of the Order, that are anticipated to address, on a schedule consistent with the Order, deadlines for attaining compliance with current wastewater permit requirements. This matter is not expected to have a material adverse effect on the Company’s financial position, cash flows or results of operations. Other Contingencies The Company has contingencies involving third parties (such as labor, contract, technology or product-related claims or litigation) as well as government-related items in various jurisdictions in which it operates pertaining to such items as value-added taxes, other indirect taxes, customs and duties and sales and use taxes. It is possible that cash flows or results of operations, in any period, could be materially affected by the unfavorable resolution of one or more of these contingencies. The most significant government-related contingencies exist in Brazil. With regard to the Brazilian matters, the Company believes it has valid defenses for the underlying positions under dispute; however, in order to pursue these defenses, the Company is required to, and has provided, bank guarantees and pledged assets in the aggregate amount of approximately $18 million. The Brazilian matters take an extended period of time to proceed through the judicial process and there are a limited number of rulings to date. Brazil Tax Credits In 2017 the Brazilian Supreme Court (“BSC”) ruled that Brazilian tax authorities should not include a value added tax known as “ICMS” in the calculation of certain indirect taxes (“PIS/COFINS”). By removing the ICMS from the calculation of the indirect tax base, the Court effectively eliminated a “tax on tax”. The Brazilian tax authorities filed an appeal seeking clarification of certain matters, including the amount of ICMS to which taxpayers would be entitled in order to reduce their indirect tax base (i.e. the gross rate or the net rate). In light of the BSC’s decision, in November 2017, the Company filed suit consistent with the BSC decision to require that ICMS be excluded from the PIS/COFINS calculation and received a favorable preliminary decision that was confirmed by the BSC in September 2018. This preliminary ruling granted the Company the right to prospectively exclude ICMS amounts from the PIS/COFINS calculation, but left open the issue of whether the Company could recover the gross or net amount of ICMS amounts paid on PIS/COFINS for the period from November 2011 to December 2018. In January 2020, the Company was informed of a favorable ruling from the Brazilian tax authorities confirming that the Company was entitled to recover the overpayments of PIS/COFINS for the period from November 2011 to December 2018, plus interest on the amount of the overpayments. The ruling did not, however, settle the question of whether the Company is eligible to recover overpayments based on the gross or the net amount of ICMS amounts paid on PIS/COFINS. The Company calculated the amount of overpayments using the gross method which yields a higher amount than the application of the net method. In February 2023, the BSC made an unfavorable court resolution for the Company related to the use of the gross method, which was only granted to claims submitted prior to March 2017. As a result of this unfavorable court resolution, the Company wrote off its remaining receivables of approximately $6 million related to this matter during the first quarter of 2023. Avicel® PH NF (Pharma Solutions) The Company has determined that certain grades of microcrystalline cellulose (Avicel® PH 101, 102, and 200 NF and Avicel® RC-591 NF) were found to be out-of-specification (collectively, “OOS Avicel® NF”). The Company does not expect the OOS conductivity issue to affect the functionality of Avicel® NF grades or to pose a human health hazard. Corrective actions have been implemented to improve operational and laboratory conditions. Based on the information available, as of September 30, 2023, payments associated with this matter were approximately $46 million, and the Company no longer had an accrual related to this matter. The total amount of exposure may increase if additional customers present claims or other exposures are identified. Other The Company determines estimates of reasonably possible losses or ranges of reasonably possible losses in excess of related accrued liabilities, if any, when it has determined that either a loss is reasonably possible or a loss in excess of accrued amounts is reasonably possible and the amount of losses or range of losses is determinable. For all third party contingencies (including labor, contract, technology, tax, product-related claims and business litigation), the Company currently estimates that the aggregate range of reasonably possible losses in excess of any accrued liabilities is $0 to approximately $65 million. The estimates included in this amount are based on the Company’s analysis of currently available information and, as new information is obtained, these estimates may change. Due to the inherent subjectivity of the assessments and the unpredictability of outcomes of legal proceedings, any amounts accrued or included in this aggregate amount may not represent the ultimate loss to the Company from the matters in question. Thus, the Company’s exposure and ultimate losses may be higher or lower, and possibly significantly so, than the amounts accrued or the range disclosed above. |
Redeemable Noncontrolling Inter
Redeemable Noncontrolling Interests | 9 Months Ended |
Sep. 30, 2023 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontrolling Interests | REDEEMABLE NON-CONTROLLING INTERESTS Through certain subsidiaries of the Company’s Frutarom acquisition, there are certain non-controlling interests that carry redemption features. The non-controlling interest holders have the right, over a stipulated period of time, to sell their respective interests to Frutarom, and Frutarom has the option to purchase these interests (subject to the same timing). In most cases, these options carry similar price and conditions of exercise, and will be settled on a pre-agreed formula based on a multiple of the average EBITDA of consecutive quarters to be achieved during the period ending prior to the exercise date. The following table sets forth the details of the Company’s redeemable non-controlling interests: (DOLLARS IN MILLIONS) Redeemable Balance at December 31, 2021 $ 105 Impact of foreign exchange translation (4) Share of profit or loss attributable to redeemable non-controlling interests 3 Redemption value adjustment for the current period (3) Exercises of redeemable non-controlling interests (33) Balance at September 30, 2022 $ 68 Balance at December 31, 2022 $ 59 Redemption value adjustment for the current period 1 Balance at September 30, 2023 $ 60 |
Discontinued Operations and Dis
Discontinued Operations and Disposal Groups | 9 Months Ended |
Sep. 30, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Assets and Liabilities Held For Sale | BUSINESS DIVESTITURES Divestiture of the Flavor Specialty Ingredients Business During the fourth quarter of 2022, the Company announced it had entered into an agreement to sell its Flavor Specialty Ingredients (“FSI”) business, which was a part of the Scent segment. The Company completed the divestiture on August 1, 2023, and received cash proceeds of approximately $190 million, which included $1 million related to the delayed transfer of the control of specific assets and liabilities of non-U.S. jurisdiction business. Concurrent with the completion of the business divestiture, the Company entered into a supply agreement arrangement with the buyer. Based on the terms of the supply agreement, an adjustment of $4 million was made against the fair value of sale consideration. In addition, approximately $15 million of proceeds were held in escrow and will be released upon satisfaction of certain conditions. The proceeds held in escrow were presented in Prepaid expenses and other current assets on the Consolidated Balance Sheets. The sale consideration is subject to certain post-closing adjustments, which primarily relate to cash, indebtedness and working capital balances. The following table summarizes the fair value of sale consideration received in connection with the business divestiture: (DOLLARS IN MILLIONS) Cash proceeds from the buyer $ 190 Amount held in escrow 15 Advance receipt for business to be transferred (1) Direct costs to sell (5) Proceeds attributable to supply agreement (4) Fair value of sale consideration $ 195 The net proceeds received from the business divestiture presented under Cash flows from investing activities represent the cash portion of the sale consideration, which was determined as the fair value of sale consideration adjusted by the direct costs to sell, advance receipt for business to be transferred, amount held in escrow and the cash transferred to the buyer as part of the transaction. The following table summarizes the different components of net proceeds received from business divestiture presented under Cash flows from investing activities: (DOLLARS IN MILLIONS) Fair value of sale consideration $ 195 Direct costs to sell 5 Advance receipt for business to be transferred 1 Amount held in escrow (15) Cash transferred to the buyer (1) Net proceeds received from business divestiture $ 185 The carrying amount of net assets associated with the business unit, adjusted for currency translation adjustment, was approximately $205 million. The major classes of assets and liabilities sold consisted of the following: (DOLLARS IN MILLIONS) August 1, 2023 Assets Cash and cash equivalents $ 1 Trade receivables, net 13 Inventories 45 Property, plant and equipment, net 29 Goodwill 44 Other intangible assets, net 73 Other assets 10 Total assets 215 Liabilities Accounts payable (4) Deferred tax liability (1) Other liabilities (6) Total liabilities (11) Equity Accumulated other comprehensive income - currency translation adjustment 1 Total equity 1 Carrying value of net asset (adjusted for currency translation adjustment) $ 205 As a result of the business divestiture, the Company recognized a pre-tax loss of approximately $10 million, subject to certain post-closing adjustments, presented in Other income, net on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the three and nine months ended September 30, 2023. The Company has also recognized income tax effects associated with the business divestiture across multiple periods. Based on preliminary estimates, the total income taxes recognized was approximately $15 million, with approximately $3 million that was recognized during the year ended December 31, 2022. Divestiture of a Portion of the Savory Solutions Business During the fourth quarter of 2022, the Company announced it had entered into an agreement to sell a portion of its Savory Solutions business, which was part of the Nourish segment. The Company completed the divestiture on May 31, 2023, and received cash proceeds of approximately $840 million. In addition, a receivable of approximately $30 million was recorded which reflects the estimated future payment to be received as part of the sale consideration. The sale consideration is subject to certain post-closing adjustments, which primarily relate to cash, indebtedness and working capital balances. The following table summarizes the fair value of sale consideration received in connection with the business divestiture: (DOLLARS IN MILLIONS) Cash proceeds from the buyer $ 840 Receivable from the buyer 30 Direct costs to sell (20) Fair value of sale consideration $ 850 The net proceeds received from the business divestiture presented under Cash flows from investing activities represent the cash portion of the sale consideration, which was determined as the fair value of sale consideration adjusted by the amount receivable from the buyer, direct costs to sell and the cash transferred to the buyer as part of the transaction. The following table summarizes the different components of net proceeds received from business divestiture presented under Cash flows from investing activities: (DOLLARS IN MILLIONS) Fair value of sale consideration $ 850 Direct costs to sell 20 Receivable from the buyer (30) Cash transferred to the buyer (including restricted cash) (19) Net proceeds received from business divestiture $ 821 The carrying amount of net assets associated with the business unit, adjusted for currency translation and pension adjustments, was approximately $860 million. The major classes of assets and liabilities sold consisted of the following: (DOLLARS IN MILLIONS) May 31, 2023 Assets Cash and cash equivalents $ 15 Restricted cash 4 Trade receivables, net 69 Inventories 116 Property, plant and equipment, net 77 Goodwill 317 Other intangible assets, net 367 Right-of-use assets 20 Other assets 24 Total assets 1,009 Liabilities Accounts payable (44) Deferred tax liability (92) Other liabilities (54) Total liabilities (190) Equity Accumulated other comprehensive income - currency translation adjustment 42 Accumulated other comprehensive income - pension liability and postretirement (1) Total equity 41 Carrying value of net asset (adjusted for currency translation and pension adjustments) $ 860 As a result of the business divestiture, the Company recognized a pre-tax loss of approximately $10 million, subject to certain post-closing adjustments, presented in Other income, net on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the nine months ended September 30, 2023. The Company has also recognized income tax effects associated with the business divestiture across multiple periods. Based on preliminary estimates, the total income taxes recognized was approximately $88 million, with approximately $72 million that was recognized during the year ended December 31, 2022. Liquidation of a Business in Russia As part of the liquidation of a business in Russia for the sale of the portion of the Savory Solutions business, the Company recognized a pre-tax loss of approximately $10 million presented in the Other income, net, and tax benefits of approximately $2 million presented in Provision for income taxes on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the nine months ended September 30, 2023. Divestiture of Microbial Control The Company completed the divestiture of the Microbial Control business unit on July 1, 2022, which was acquired as part of the Company’s merger with Nutrition and Biosciences, Inc. (“N&B”), a wholly-owned subsidiary of DuPont, in 2021 (the “Merger”), and received net cash proceeds of approximately $1.169 billion. The Company also entered into transition services agreements with the buyer for providing certain general accounting, information technology and other services up to 19 months following the date of the sale for minimal consideration. The fair value of these transition services agreements was determined to be approximately $36 million, which was adjusted against the sale consideration and recognized as deferred transition services income. The transition services income under the transition services agreements for the three and nine months ended September 30, 2023 was approximately $6 million and $19 million, respectively, and for the three and nine months ended September 30, 2022 was approximately $6 million. The transition services income was recognized as a reduction to the costs incurred to provide services under the transition services agreements, which was included in Selling and administrative expenses on the Consolidated Statements of Income (Loss) and Comprehensive Loss. During the third quarter of 2023, the Company announced the sale process of its Cosmetic Ingredients business within the Scent segment, and in the fourth quarter of 2023, the Company entered into an agreement to sell its Cosmetic Ingredients business. The transaction is subject to customary closing conditions and is expected to close in the first quarter of 2024. The planned sale does not constitute a strategic shift of the Company’s operations and does not have major effects on the Company’s operations and financial results; therefore, the transaction does not meet the discontinued operations criteria. The Company determined that the assets and liabilities of the business met the criteria to be presented as “held for sale.” As a result, as of September 30, 2023, such assets and liabilities were classified as held for sale and are reported on the Consolidated Balance Sheets. The Company expects that the sale proceeds less costs to sell will exceed the preliminary estimate of the carrying value of the net assets for the business. The carrying value is subject to change based on developments leading up to the closing date. Included in the Company’s Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022 are the following carrying amounts of the assets and liabilities held for sale: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 (2) Assets Cash and cash equivalents $ 23 $ 52 Trade receivables, net 15 85 Inventories 19 157 Property, plant and equipment, net 7 92 Goodwill 267 348 Other intangible assets, net 141 428 Operating lease right-of-use assets 8 13 Other assets 2 25 Total assets held-for-sale $ 482 $ 1,200 Liabilities Accounts payable $ 4 $ 56 Deferred tax liability (1) 25 92 Other liabilities 20 64 Total liabilities held-for-sale $ 49 $ 212 _______________________ (1) The Company is currently analyzing the tax impact of the sale transaction and has included preliminary numbers for the deferred tax liability, which are subject to further updates. (2) The amounts for December 31, 2022 represent the carrying amounts of the portion of the Savory Solutions business and FSI business that were classified as held for sale. The Company completed the divestitures of the businesses on May 31, 2023 and August 1, 2023, respectively. Refer to Note 3 for additional information. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2023 | |
Business Combinations [Abstract] | |
Acquisitions | ACQUISITIONS Acquisition of Health Wright Products On April 1, 2022 (“Acquisition Date”), the Company completed its acquisition of Health Wright Products, Inc. (“Health Wright”). IFF acquired 100% of the equity of Health Wright pursuant to a purchase agreement entered into on February 16, 2022. Health Wright is within the Company’s Health & Biosciences segment since the Acquisition Date. The acquisition was accounted for under the purchase method and the purchase price allocation was completed as of December 31, 2022. During the second quarter of 2023, the Company remeasured the fair value of contingent consideration obligations, and, as a result, recognized an expense of approximately $5 million presented in Selling and administrative expenses on the Consolidated Statements of Income (Loss) and Comprehensive Loss. Refer to Note 3 of the Company’s 2022 Form 10-K for additional information. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) Attributable to Parent | $ 25 | $ (2,197) | $ 43 | $ (1,846) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended | 9 Months Ended |
Sep. 30, 2023 | Sep. 30, 2023 | |
Trading Arrangements, by Individual | ||
Material Terms of Trading Arrangement | During the quarter ended September 30, 2023, none of our directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) (a “10b5-1 trading arrangement”) or any “non-Rule 10b5-1 trading arrangement” as defined in Item 408(c) of Regulation S-K. | |
Rule 10b5-1 Arrangement Adopted | false | |
Non-Rule 10b5-1 Arrangement Adopted | false | |
Rule 10b5-1 Arrangement Terminated | false | |
Non-Rule 10b5-1 Arrangement Terminated | false |
Nature of Operations and Summ_2
Nature of Operations and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Nature of Operations | Nature of Operations International Flavors & Fragrances Inc. and its subsidiaries (the “Registrant,” “IFF,” “the Company,” “we,” “us” and “our”) is a leading creator and manufacturer of food, beverage, health & biosciences, scent and pharma solutions and complementary adjacent products, including cosmetic active and natural health ingredients, which are used in a wide variety of consumer products. Our products are sold principally to manufacturers of perfumes and cosmetics, hair and other personal care products, soaps and detergents, cleaning products, dairy, meat and other processed foods, beverages, snacks and savory foods, sweet and baked goods, sweeteners, dietary supplements, food protection, infant and elderly nutrition, functional food, and pharmaceutical excipients and oral care products. |
Basis of Presentation | Basis of Presentation The accompanying interim Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and the related notes included in our 2022 Annual Report on Form 10-K (“2022 Form 10-K”). The interim Consolidated Financial Statements are unaudited. In addition, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted, if not materially different from the 2022 Form 10-K. The year-end balance sheet data included in this Form 10-Q was derived from the audited financial statements. In the opinion of management, all adjustments, which consist of normal recurring adjustments necessary for a fair statement of the interim Consolidated Financial Statements, have been made. |
Reporting Periods | Reporting Periods The Company uses a calendar year of the twelve-month period from January 1 to December 31. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) requires management to make estimates and judgments that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. The inputs into the Company’s judgments and estimates take into account the ongoing global current events and adverse macroeconomic impacts on our critical and significant accounting estimates, including estimates associated with future cash flows that are used in assessing the risk of impairment of certain assets. Actual results could differ from those estimates. |
Accounts Receivable | Accounts Receivable The Company has various factoring agreements in the U.S. and The Netherlands under which it can factor up to approximately €250 million in receivables (“Company’s own factoring agreements”). In addition, the Company utilizes factoring agreements sponsored by certain customers. Under all of the arrangements, the Company sells the receivables on a non-recourse basis to unrelated financial institutions and accounts for the transactions as a sale of receivables. The applicable receivables are removed from the Company’s Consolidated Balance Sheets when the cash proceeds are received by the Company. The Company sold a total of approximately $1.302 billion and $983 million of receivables under the Company’s own factoring agreements and customer sponsored factoring agreements for the nine months ended September 30, 2023 and 2022, respectively. The cost of participating in these programs was approximately $6 million and $3 million for the three months ended September 30, 2023 and 2022, respectively, and was approximately $18 million and $6 million for the nine months ended September 30, 2023 and 2022, respectively. These costs are included as a component of interest expense. Under the Company’s own factoring agreements, it sold approximately $632 million and $323 million of receivables for the nine months ended September 30, 2023 and 2022, respectively. The outstanding principal amounts of receivables under the Company’s own factoring agreements amounted to approximately $148 million and $157 million as of September 30, 2023 and December 31, 2022, respectively. The proceeds from the sales of receivables are included in net cash from operating activities in the Consolidated Statements of Cash Flows. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue from contracts with customers when the contract or purchase order has received approval and commitment from both parties, has the rights of the parties and payment terms (which can vary by customer) identified, has commercial substance, collectability of consideration is probable, and control has transferred. The revenue recognized reflects the consideration the Company expects to be entitled to in exchange for those goods. Sales, value added, and other taxes the Company collects are excluded from revenues. The Company receives payment in accordance with standard customer terms. Sales are reduced, at the time revenue is recognized, for applicable discounts, rebates and sales allowances based on historical experience. Related accruals are included in Other current liabilities in the accompanying Consolidated Balance Sheets. The Company considers shipping and handling activities undertaken after the customer has obtained control of the related goods as a fulfillment activity. Net sales include shipping and handling charges billed to customers. Cost of goods sold includes all costs incurred in connection with shipping and handling. See Note 12 for further details on revenues disaggregated by segment. |
Expected Credit Loss | Expected Credit Losses The Company is exposed to credit losses primarily through its sales of products. To determine the appropriate allowance for expected credit losses, the Company considers certain credit quality indicators, such as aging, collection history, and creditworthiness of debtors. Regional and Global Credit committees review and approve specific customer allowance reserves. The allowance for expected credit losses is primarily based on two primary factors: i) the aging of the different categories of trade receivables, and ii) a specific reserve for accounts identified as uncollectible. The Company also considers current and future economic conditions in the determination of the allowance. At September 30, 2023, the Company reported $1.831 billion of trade receivables, net of allowances of $55 million. Based on the aging analysis as of September 30, 2023, approximately 1% of the Company’s accounts receivable were past due by over 365 days based on the payment terms of the invoice. |
Long-Lived Assets | Long-Lived Assets The Company reviews long-lived assets for impairment when events or changes in business conditions indicate that their carrying value may not be recovered. An estimate of undiscounted future cash flows produced by an asset or group of assets is compared to the carrying value to determine whether impairment exists. If assets are determined to be impaired, the loss is measured based on an estimate of fair value using various valuation techniques, including a discounted estimate of future cash flows. |
Goodwill | Goodwill Goodwill represents the difference between the total purchase price and the fair value of identifiable assets and liabilities acquired in business acquisitions. The Company tests goodwill for impairment at the reporting unit level as of November 30 every year, or more frequently if events or changes in circumstances indicate the asset might be impaired. A reporting unit is an operating segment or one level below an operating segment (referred to as a component or group of components) to which goodwill is assigned when initially recorded. The Company identifies its reporting units by assessing whether the components of its reporting segments constitute businesses for which discrete financial information is available and management of each reporting unit regularly reviews the operating results of those components. The Company determined that it has six reporting units under the Nourish, Health & Biosciences, Scent and Pharma Solutions segments: (1) Nourish, (2) Fragrance Compounds, (3) Fragrance Ingredients, (4) Cosmetic Ingredients, (5) Health & Biosciences and (6) Pharma Solutions. These reporting units were determined based on the level at which the performance is measured and reviewed by segment management. In cases where the components of an operating segment have similar economic characteristics, they are aggregated into a single reporting unit. During the third quarter of 2022, the Company determined that the carrying value of the Health & Biosciences reporting unit exceeded its fair value and recorded a goodwill impairment charge of $2.250 billion on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the three and nine months ended September 30, 2022 (see Note 6 for additional information). |
Unusual or Infrequent Items, or Both, Disclosure | Events in Israel The Company maintains operations in Israel and, additionally, exports products to customers in Israel from operations outside the region. The Company will continue to evaluate the current events and any potential impacts to its Consolidated Financial Statements. Events in Russia and Ukraine The Company maintains operations in both Russia and Ukraine and, additionally, exports products to customers in Russia and Ukraine from operations outside the region. In response to the events in Ukraine, the Company has limited the production and supply of ingredients in and to Russia to only those that meet the essential needs of people, including food, hygiene and medicine. Allowances for Bad Debts As of September 30, 2023, the Company had a reserve of approximately $3 million related to expected credit losses on receivables from customers located in Russia and Ukraine. The Company will continue to evaluate its credit exposure related to Russia and Ukraine. Impairment of Long-Lived Assets During the second quarter of 2022, the sales and margins declined for certain entities within Russia due to supply chain issues, reduced product demand and exchange rate volatility. Further, it was determined that such declines in operating performance were not expected to reverse in the near future. Additionally, future expected growth was expected to be limited given operating conditions in Russia, which inhibited the required future investment. In connection with uncertainties related to the Company’s operations in Russia and Ukraine, the Company updated its analysis of the undiscounted cash flows of the applicable asset groups to determine if the cash flows exceeded the carrying values of the applicable asset groups. With respect to an asset group in the Nourish segment, that manufactures and sells in Russia and related markets, it was determined that the undiscounted cash flows were insufficient to cover the carrying value and that an impairment charge was required to write-down the long-lived assets to their fair values. The fair value of such asset group was determined based on a discounted cash flow approach which involved estimating the future cash flows for the business discounted to their present values. The discount rate used in the determination of such fair value was based on consideration of the risks inherent in the cash flows and market as of the valuation date. As a result of this assessment, the Company recognized an impairment charge of $120 million during the second quarter of 2022, which was allocated on a pro rata basis to intangible assets and property, plant and equipment within the asset group in the amounts of approximately $92 million and $28 million, respectively. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In December 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2022-06, “Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848.” The ASU was issued to provide an update on ASU 2020-04 and ASU 2021-01 that were issued in March 2020 and January 2021, respectively, which provided optional accounting guidance for a limited period of time to ease the potential burden in accounting for reference rate reform. The guidance provides optional expedients and exceptions to existing accounting requirements for contract modifications and hedge accounting related to transitioning from discontinued reference rates, such as London Interbank Offered Rate (“LIBOR”), to alternative reference rates, if certain criteria are met. With the issuance of ASU 2022-06, the sunset date of Topic 848 has been deferred from December 31, 2022 to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. The Company has adopted this guidance on January 1, 2023, which did not have a material impact on its Consolidated Financial Statements. On March 23, 2023, the Company amended certain existing debt agreements where the interest rate benchmark was updated from LIBOR to the Secured Overnight Financing Rate (“Term SOFR”). The Company applied Topic 848 to its recent amendments of its debt agreements. See Note 8 for additional information on the amendments to the debt agreements. |
Nature of Operations and Summ_3
Nature of Operations and Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Reconciliation of Cash | Cash, cash equivalents and restricted cash reported in the Company’s balance sheet as of September 30, 2023, December 31, 2022, September 30, 2022 and December 31, 2021 were as follows: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 September 30, 2022 December 31, 2021 Current assets Cash and cash equivalents $ 629 $ 483 $ 538 $ 711 Cash and cash equivalents included in Assets held for sale 23 52 — — Restricted cash 10 10 10 4 Non-current assets Restricted cash included in Other assets — 7 7 1 Cash, cash equivalents and restricted cash $ 662 $ 552 $ 555 $ 716 |
Contract Asset and Accounts Receivable | Contract Assets and Liabilities With respect to a small number of contracts for the sale of compounds, the Company has an “enforceable right to payment for performance to date” and as the products do not have an alternative use, the Company recognizes revenue for these contracts over time and records a contract asset using the output method. The output method recognizes revenue on the basis of direct measurements of the value to the customer of the goods or services transferred to date relative to the remaining goods or services promised under the contract. |
Schedule of Bad Debt Reserve | The following is a rollforward of the Company’s allowances for bad debts for the nine months ended September 30, 2023: (DOLLARS IN MILLIONS) Allowances for Balance at December 31, 2022 $ 53 Bad debt expense (1) 9 Write-offs (6) Foreign exchange (1) Balance at September 30, 2023 $ 55 _______________________ (1) Bad debt expense included approximately $13 million related to expected credit losses on receivables from certain customers in Egypt, offset by approximately $8 million of reversals of allowances on receivables from customers located in Russia and Ukraine. The Company will continue to evaluate its credit exposure related to Egypt, Russia and Ukraine. |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Reconciliation of Shares Used in Computation of Basic and Diluted Net Income Per Share | A reconciliation of the shares used in the computation of basic and diluted net income (loss) per share is as follows: Three Months Ended September 30, Nine Months Ended September 30, (AMOUNTS IN MILLIONS EXCEPT PER SHARE AMOUNTS) 2023 2022 2023 2022 Net Income (Loss) Net income (loss) attributable to IFF shareholders $ 25 $ (2,197) $ 43 $ (1,846) Adjustment related to (increase) decrease in redemption value of redeemable noncontrolling interests in excess of earnings allocated — 1 (1) 3 Net income (loss) available to IFF shareholders $ 25 $ (2,196) $ 42 $ (1,843) Shares Weighted average common shares outstanding (basic) 255 255 255 255 Adjustment for assumed dilution: Stock options and restricted stock awards 1 — — — Weighted average shares assuming dilution (diluted) 256 255 255 255 Net Income (Loss) per Share Net income (loss) per share - basic (1) $ 0.10 $ (8.60) $ 0.16 $ (7.22) Net income (loss) per share - diluted (1) 0.10 (8.60) 0.16 (7.22) _______________________ (1) For the three and nine months ended September 30, 2022, the basic and diluted net loss per share cannot be recalculated based on the information presented in the table above due to rounding. |
Business Divestiture (Tables)
Business Divestiture (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations | The following table summarizes the fair value of sale consideration received in connection with the business divestiture: (DOLLARS IN MILLIONS) Cash proceeds from the buyer $ 190 Amount held in escrow 15 Advance receipt for business to be transferred (1) Direct costs to sell (5) Proceeds attributable to supply agreement (4) Fair value of sale consideration $ 195 (DOLLARS IN MILLIONS) Fair value of sale consideration $ 195 Direct costs to sell 5 Advance receipt for business to be transferred 1 Amount held in escrow (15) Cash transferred to the buyer (1) Net proceeds received from business divestiture $ 185 (DOLLARS IN MILLIONS) August 1, 2023 Assets Cash and cash equivalents $ 1 Trade receivables, net 13 Inventories 45 Property, plant and equipment, net 29 Goodwill 44 Other intangible assets, net 73 Other assets 10 Total assets 215 Liabilities Accounts payable (4) Deferred tax liability (1) Other liabilities (6) Total liabilities (11) Equity Accumulated other comprehensive income - currency translation adjustment 1 Total equity 1 Carrying value of net asset (adjusted for currency translation adjustment) $ 205 The following table summarizes the fair value of sale consideration received in connection with the business divestiture: (DOLLARS IN MILLIONS) Cash proceeds from the buyer $ 840 Receivable from the buyer 30 Direct costs to sell (20) Fair value of sale consideration $ 850 (DOLLARS IN MILLIONS) Fair value of sale consideration $ 850 Direct costs to sell 20 Receivable from the buyer (30) Cash transferred to the buyer (including restricted cash) (19) Net proceeds received from business divestiture $ 821 (DOLLARS IN MILLIONS) May 31, 2023 Assets Cash and cash equivalents $ 15 Restricted cash 4 Trade receivables, net 69 Inventories 116 Property, plant and equipment, net 77 Goodwill 317 Other intangible assets, net 367 Right-of-use assets 20 Other assets 24 Total assets 1,009 Liabilities Accounts payable (44) Deferred tax liability (92) Other liabilities (54) Total liabilities (190) Equity Accumulated other comprehensive income - currency translation adjustment 42 Accumulated other comprehensive income - pension liability and postretirement (1) Total equity 41 Carrying value of net asset (adjusted for currency translation and pension adjustments) $ 860 Included in the Company’s Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022 are the following carrying amounts of the assets and liabilities held for sale: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 (2) Assets Cash and cash equivalents $ 23 $ 52 Trade receivables, net 15 85 Inventories 19 157 Property, plant and equipment, net 7 92 Goodwill 267 348 Other intangible assets, net 141 428 Operating lease right-of-use assets 8 13 Other assets 2 25 Total assets held-for-sale $ 482 $ 1,200 Liabilities Accounts payable $ 4 $ 56 Deferred tax liability (1) 25 92 Other liabilities 20 64 Total liabilities held-for-sale $ 49 $ 212 _______________________ (1) The Company is currently analyzing the tax impact of the sale transaction and has included preliminary numbers for the deferred tax liability, which are subject to further updates. (2) The amounts for December 31, 2022 represent the carrying amounts of the portion of the Savory Solutions business and FSI business that were classified as held for sale. The Company completed the divestitures of the businesses on May 31, 2023 and August 1, 2023, respectively. Refer to Note 3 for additional information. |
Restructuring and Other Charg_2
Restructuring and Other Charges, Net (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Changes in Employee-Related Restructuring Liabilities | Changes in Restructuring Liabilities Changes in restructuring liabilities during the nine months ended September 30, 2023 were as follows: (DOLLARS IN MILLIONS) Balance at December 31, 2022 Additional Charges (Reversals), Net Non-Cash Charges Cash Payments Balance at September 30, 2023 Frutarom Integration Initiative Severance $ 4 $ (3) $ — $ (1) $ — Other Restructuring Charges Severance 1 (1) — — — N&B Merger Restructuring Liability Severance 9 — — (8) 1 Other 1 2 (2) (1) — 2023 Restructuring Program Severance — 63 — (39) 24 Total Restructuring and other charges $ 15 $ 61 $ (2) $ (49) $ 25 Restructuring liabilities are presented in “Other current liabilities” on the Consolidated Balance Sheets. Charges by Segment The following table summarizes the total amount of costs incurred in connection with these restructuring programs and activities by segment: Three Months Ended September 30, Nine Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Nourish $ 1 $ — $ 33 $ 3 Health & Biosciences 1 1 12 2 Scent — (5) 14 — Pharma Solutions — — 2 — Total Restructuring and other charges $ 2 $ (4) $ 61 $ 5 |
Property, Plant, and Equipment
Property, Plant, and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, plant and equipment consisted of the following amounts: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 Asset Type Land $ 191 $ 199 Buildings and improvements 1,721 1,697 Machinery and equipment 3,575 3,344 Information technology 386 291 Construction in process 495 649 Total Property, plant and equipment 6,368 6,180 Accumulated depreciation (2,242) (1,977) Total property, plant and equipment, net $ 4,126 $ 4,203 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets, Net (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Movements in Goodwill | Movements in goodwill attributable to each reportable segment for the nine months ended September 30, 2023 were as follows: (DOLLARS IN MILLIONS) Nourish Health & Biosciences Scent Pharma Solutions Total Balance at December 31, 2022 $ 6,050 $ 4,321 $ 1,745 $ 1,239 $ 13,355 Transferred to assets held for sale — — (267) — (267) Reduction from business divestitures (4) — — — (4) Foreign exchange (41) (7) (2) (3) (53) Balance at September 30, 2023 $ 6,005 $ 4,314 $ 1,476 $ 1,236 $ 13,031 The goodwill balances at September 30, 2023 and December 31, 2022 include $2.250 billion of accumulated impairment related to the Health & Biosciences reportable segment. The accumulated impairment relates entirely to an impairment charge recorded in 2022. Impairment of Goodwill For the third quarter of 2022, the Company determined that goodwill impairment triggering events occurred for its Nourish, Health & Biosciences and Pharma Solutions reporting units, which required it to complete an interim impairment assessment. The primary indicators that were deemed to be triggering events in the quarter for the reporting units were declines in the Company’s projections across various reporting units and ongoing adverse macroeconomic impacts such as inflation, increases in interest rates and unfavorable effects from exchange rates. As a result of the triggering events, the Company assessed the fair value of the reporting units using the income approach. Under the income approach, the Company determined the fair value by using a discounted cash flow method at a rate of return that reflected the relative risk of the projected future cash flows of each reporting unit, as well as a terminal value. The Company used the most current actual and forecasted operating data available. Key estimates and assumptions used in these valuations included revenue growth rates, gross margins, EBITDA margins, terminal growth rates and discount rates. These estimates and assumptions were considered Level 3 inputs under the fair value hierarchy. In performing the quantitative impairment test, the Company determined that the fair value of the Nourish and Pharma Solutions reporting units exceeded their carrying value, and determined that there was no impairment of goodwill relating to these reporting units. The Company determined that the carrying value of the Health & Biosciences reporting unit exceeded its fair value and recorded a goodwill impairment charge of $2.250 billion on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the three and nine months ended September 30, 2022. |
Schedule of Other Intangible Assets, Net | Other intangible assets, net consisted of the following amounts: September 30, December 31, (DOLLARS IN MILLIONS) 2023 2022 Asset Type Customer relationships $ 8,072 $ 8,318 Technological know-how 2,314 2,339 Trade names & patents 331 358 Other 44 47 Total carrying value 10,761 11,062 Accumulated Amortization Customer relationships (1,488) (1,252) Technological know-how (745) (589) Trade names & patents (107) (97) Other (40) (42) Total accumulated amortization (2,380) (1,980) Other intangible assets, net $ 8,381 $ 9,082 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Amortization expense for the next five years is expected to be as follows: (DOLLARS IN MILLIONS) 2023 2024 2025 2026 2027 Estimated future intangible amortization expense $ 173 $ 692 $ 690 $ 688 $ 589 |
Other Assets and Liabilities,_2
Other Assets and Liabilities, Current and Noncurrent (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Other Assets [Abstract] | |
Schedule of Other Assets | Other assets consisted of the following amounts: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 Deferred income taxes $ 212 $ 167 Overfunded pension plans 202 180 Cash surrender value of life insurance contracts 46 45 Finance lease right-of-use assets 25 22 Equity method investments 10 10 Other (1) 268 265 Total $ 763 $ 689 _______________________ (1) Includes land usage rights in China, long-term deposits and receivables on certain derivative instruments. |
Schedule of Other Current Assets | Prepaid expenses and other current assets consisted of the following amounts: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 Value-added tax receivable $ 159 $ 212 Prepaid income taxes 224 129 Packaging materials and supplies 157 148 Prepaid expenses 184 144 Other 166 137 Total $ 890 $ 770 |
Other Current Liabilities | Other current liabilities consisted of the following amounts: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 Rebates and incentives payable $ 99 $ 99 Value-added tax payable 62 65 Interest payable 74 55 Current pension and other postretirement benefit obligation 5 10 Accrued insurance (including workers’ compensation) 10 9 Earn outs payable 31 — Accrued restructuring 25 15 Current operating lease obligation 83 86 Accrued freight 12 18 Accrued commissions payable 10 11 Accrued income taxes 118 313 Accrued expenses payable 263 256 Other 145 91 Total $ 937 $ 1,028 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Components of Debt | Debt consisted of the following: (DOLLARS IN MILLIONS) Effective Interest Rate September 30, 2023 December 31, 2022 2023 Notes (1) 3.30 % $ — $ 300 2024 Euro Notes (1) 1.88 % 525 532 2025 Notes (1) 1.22 % 1,000 1,000 2026 Euro Notes (1) 1.93 % 836 845 2027 Notes (1) 1.56 % 1,213 1,215 2028 Notes (1) 4.57 % 398 398 2030 Notes (1) 2.21 % 1,509 1,510 2040 Notes (1) 3.04 % 773 774 2047 Notes (1) 4.44 % 495 495 2048 Notes (1) 5.12 % 787 787 2050 Notes (1) 3.21 % 1,570 1,571 2024 Term Loan Facility (2) 6.50 % 570 625 2026 Term Loan Facility (2) 5.41 % 625 625 Revolving Credit Facility (3) — 100 Commercial paper (4) — 187 Bank overdrafts and other — 6 Total debt 10,301 10,970 Less: Short-term borrowings (5) (1,142) (597) Total Long-term debt $ 9,159 $ 10,373 _______________________ (1) Amount is net of unamortized discount and debt issuance costs. (2) Amount is recorded at fair value. (3) The interest rate on the Revolving Credit Facility is, at the applicable borrower’s option, a per annum rate equal to either (x) an eurocurrency rate plus an applicable margin varying from 1.000% to 1.625% or (y) a base rate plus an applicable margin varying from 0.000% to 0.625%, in each case depending on the public debt ratings for non-credit enhanced long-term senior unsecured debt issued by the Company. (4) The effective interest rate of commercial paper issuances fluctuates as short-term interest rates and demand fluctuate, and deferred debt issuance costs are immaterial. Additionally, the effective interest rate of commercial paper is not meaningful as issuances do not materially differ from short-term interest rates. (5) Includes bank borrowings, commercial paper, overdrafts and current portions of long-term debt. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Lease cost and other information | The components of lease expense were as follows: Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended (DOLLARS IN MILLIONS) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Operating leases Operating lease cost $ 32 $ 31 $ 105 $ 99 Variable lease cost 10 12 42 36 Total operating lease cost $ 42 $ 43 $ 147 $ 135 Finance leases Finance lease cost $ 3 $ 2 $ 7 $ 6 Supplemental cash flow information related to leases was as follows: Nine Months Ended Nine Months Ended (DOLLARS IN MILLIONS) September 30, 2023 September 30, 2022 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows for operating leases $ 94 $ 102 Operating cash flows for finance leases 1 — Financing cash flows for finance leases 6 5 Right-of-use assets obtained in exchange for lease obligations Operating leases 73 154 Finance leases 17 4 |
Stock Compensation Plans (Table
Stock Compensation Plans (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation Expense and Related Tax Benefits | Stock-based compensation expense and related tax benefits were as follows: Three Months Ended September 30, Nine Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Equity-based awards $ 18 $ 12 $ 50 $ 37 Liability-based awards — (1) — — Total stock-based compensation expense 18 11 50 37 Less: Tax benefit (5) (2) (11) (7) Total stock-based compensation expense, after tax $ 13 $ 9 $ 39 $ 30 As of September 30, 2023, there was approximately $90 million of total unrecognized compensation cost related to non-vested awards granted under the equity incentive plans. |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Reportable Segment Information | Reportable segment information was as follows: Three Months Ended Nine Months Ended September 30, September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Net sales: Nourish $ 1,449 $ 1,703 $ 4,666 $ 5,252 Health & Biosciences 518 512 1,553 1,838 Scent 615 591 1,815 1,756 Pharma Solutions 238 257 742 750 Consolidated $ 2,820 $ 3,063 $ 8,776 $ 9,596 Segment Adjusted Operating EBITDA: Nourish $ 178 $ 287 $ 567 $ 981 Health & Biosciences 150 137 426 513 Scent 131 119 353 328 Pharma Solutions 47 69 173 192 Total 506 612 1,519 2,014 Depreciation & Amortization (292) (293) (855) (897) Interest Expense (110) (83) (337) (232) Other Income, net 19 33 34 43 Restructuring and Other Charges (a) (2) 4 (61) (5) Impairment of Goodwill (b) — (2,250) — (2,250) Impairment of Long-Lived Assets (c) — — — (120) Acquisition, Divestiture and Integration Related Costs (d) (42) (57) (118) (167) Strategic Initiatives Costs (e) (6) (1) (28) (1) Regulatory Costs (f) (13) — (32) — Other (g) (1) — 1 (5) Income (Loss) Before Taxes $ 59 $ (2,035) $ 123 $ (1,620) _______________________ (a) For 2023 and 2022, represents costs primarily related to severance as part of the Company's restructuring efforts. (b) Represents costs related to the impairment of goodwill in the Health & Biosciences reporting unit. (c) Represents costs related to the impairment of intangible and fixed assets of an asset group that operated primarily in Russia. (d) For 2023 and 2022, primarily represents costs related to the Company's actual and planned acquisitions and divestitures and integration related activities primarily for N&B. These costs primarily consisted of external consulting fees, professional and legal fees and salaries of individuals who are fully dedicated to such efforts. For 2023, acquisition costs primarily relate to earn-out adjustments. For the three months ended September 30, 2023, business divestiture, integration and acquisition related costs were approximately $29 million, $12 million and $1 million, respectively. For the three months ended September 30, 2022, business divestiture, integration and acquisition related costs were approximately $31 million, $25 million and $1 million, respectively. For the nine months ended September 30, 2023, business divestiture, integration and acquisition related costs were approximately $70 million, $42 million and $6 million, respectively. For the nine months ended September 30, 2022, business divestiture, integration and acquisition related costs were approximately $91 million, $73 million and $3 million, respectively. (e) Represents costs related to the Company's strategic assessment and business portfolio optimization efforts and reorganizing the Global Shared Services Centers, primarily consulting fees. (f) Represents costs primarily related to legal fees incurred for the ongoing investigations of the fragrance businesses. (g) For 2023, represents (losses) gains from sale of assets. For 2022, represents shareholder activist related costs, primarily professional fees, severance costs, including accelerated stock compensation expense, for certain executives who have been separated from the Company, and gains from sale of assets. |
Net Sales by Destination of Product Delivery | Net sales, which are attributed to individual regions based upon the destination of product delivery, were as follows: Three Months Ended September 30, Nine Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Europe, Africa and Middle East $ 918 $ 1,030 $ 2,958 $ 3,258 Greater Asia 670 701 2,031 2,200 North America 853 939 2,668 3,006 Latin America 379 393 1,119 1,132 Consolidated $ 2,820 $ 3,063 $ 8,776 $ 9,596 Three Months Ended September 30, Nine Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Net sales related to the U.S. $ 782 $ 920 $ 2,430 $ 2,799 Net sales attributed to all foreign countries 2,038 2,143 6,346 6,797 |
Employee Benefits (Tables)
Employee Benefits (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Retirement Benefits [Abstract] | |
Pension and Other Defined Contribution Retirement Plan Expenses | Pension and other defined contribution retirement plan expenses included the following components: (DOLLARS IN MILLIONS) U.S. Plans Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Service cost for benefits earned (1) $ — $ 1 $ — $ 1 Interest cost on projected benefit obligation (2) 6 4 19 12 Expected return on plan assets (2) (7) (5) (23) (16) Net amortization and deferrals (2) — 1 1 5 Net periodic benefit (income) cost $ (1) $ 1 $ (3) $ 2 (DOLLARS IN MILLIONS) Non-U.S. Plans Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Service cost for benefits earned (1) $ 5 $ 9 $ 15 $ 28 Interest cost on projected benefit obligation (2) 9 4 27 13 Expected return on plan assets (2) (11) (10) (34) (32) Net amortization and deferrals (2) — 3 (1) 9 Net periodic benefit (income) cost $ 3 $ 6 $ 7 $ 18 _______________________ (1) Included as a component of Operating profit (loss). (2) Included as a component of Other income, net. |
Postretirement Benefits Other Than Pension Expenses | (Income) expense recognized for postretirement benefits other than pensions included the following components: Three Months Ended September 30, Nine Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Service cost for benefits earned $ — $ 1 $ — $ 1 Interest cost on projected benefit obligation — — 2 1 Net amortization and deferrals (1) (2) (4) (4) Total postretirement benefit (income) expense $ (1) $ (1) $ (2) $ (2) |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Investments, All Other Investments [Abstract] | |
Carrying Amount and Estimated Fair Values of Financial Instruments | The carrying values and the estimated fair values of financial instruments at September 30, 2023 and December 31, 2022 consisted of the following: September 30, 2023 December 31, 2022 (DOLLARS IN MILLIONS) Carrying Value Fair Value Carrying Value Fair Value LEVEL 1 Cash and cash equivalents (1) $ 629 $ 629 $ 483 $ 483 LEVEL 2 Credit facilities and bank overdrafts (2) — — 106 106 Derivatives Derivative assets (3) 3 3 1 1 Derivative liabilities (3) 126 126 75 75 Commercial paper (2) — — 187 187 Long-term debt: 2023 Notes (4) — — 300 298 2024 Euro Notes (4) 525 518 532 519 2025 Notes (4) 1,000 897 1,000 884 2026 Euro Notes (4) 836 757 845 774 2027 Notes (4) 1,213 995 1,215 1,006 2028 Notes (4) 398 367 398 380 2030 Notes (4) 1,509 1,130 1,510 1,188 2040 Notes (4) 773 468 774 535 2047 Notes (4) 495 336 495 390 2048 Notes (4) 787 598 787 685 2050 Notes (4) 1,570 874 1,571 1,021 2024 Term Loan Facility (5) 570 570 625 625 2026 Term Loan Facility (5) 625 625 625 625 _______________________ (1) The carrying amount of cash and cash equivalents approximates fair value due to the short maturity of those instruments. (2) The carrying amount approximates fair value as the interest rate is reset frequently based on current market rates as well as the short maturity of those instruments. (3) The carrying amount approximates fair value as the instruments are marked-to-market and held at fair value on the Consolidated Balance Sheets. (4) The fair value of the Note is obtained from pricing services engaged by the Company, and the Company receives one price for each security. The fair value provided by the pricing services are estimated using pricing models, where the inputs to those models are based on observable market inputs or recent trades of similar securities. The inputs to the valuation techniques applied by the pricing services are typically benchmark yields, benchmark security prices, credit spreads, reported trades and broker-dealer quotes, all with reasonable levels of transparency. (5) The carrying amount approximates fair value as the Term Loans were assumed at fair value and the interest rate is reset frequently based on current market rates. |
Derivative Instruments Notional Amount Outstanding | The following table shows the notional amount of the Company’s derivative instruments outstanding as of September 30, 2023 and December 31, 2022: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 Foreign currency contracts (1) $ (1,248) $ 92 Commodity contracts (1) 13 (1) Cross currency swaps 1,400 1,400 _______________________ (1) Foreign currency contracts and commodity contracts are presented net of contracts bought and sold. |
Derivative Instruments Measured at Fair Value | The following tables show the Company’s derivative instruments measured at fair value (Level 2 of the fair value hierarchy), as reflected on the Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022: September 30, 2023 (DOLLARS IN MILLIONS) Fair Value of Fair Value of Total Fair Value Derivative assets (1) Foreign currency contracts $ — $ 3 $ 3 Derivative liabilities (2) Foreign currency contracts $ — $ 37 $ 37 Cross currency swaps 89 — 89 Total derivative liabilities $ 89 $ 37 $ 126 December 31, 2022 (DOLLARS IN MILLIONS) Fair Value of Fair Value of Total Fair Value Derivative assets (1) Foreign currency contracts $ — $ 1 $ 1 Derivative liabilities (2) Cross currency swaps $ 75 $ — $ 75 _______________________ (1) Derivative assets are recorded to Prepaid expenses and other current assets on the Consolidated Balance Sheets. (2) Derivative liabilities are recorded to Other current liabilities and Other liabilities on the Consolidated Balance Sheets. |
Derivative Instruments Which Were Not Designated as Hedging Instruments | The following table shows the effect of the Company’s derivative instruments which were not designated as hedging instruments on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the three and nine months ended September 30, 2023 and 2022: Amount of Gain (Loss) Location of Gain (Loss) Recognized in Income on Derivative (DOLLARS IN MILLIONS) Three Months Ended September 30, 2023 2022 Foreign currency contracts (1) $ (26) $ 2 Other income, net Amount of Gain (Loss) Location of Gain (Loss) Recognized in Income on Derivative (DOLLARS IN MILLIONS) Nine Months Ended September 30, 2023 2022 Foreign currency contracts (1) $ (23) $ 4 Other income, net Commodity contracts 2 — Cost of goods sold Total $ (21) $ 4 _______________________ (1) The foreign currency contract net gains (losses) offset any recognized gains (losses) arising from the revaluation of the related intercompany loans during the same respective periods. |
Derivative Instruments Designated as Cash Flow and Net Investment Hedging Instruments | The following table shows the effect of the Company’s derivative and non-derivative instruments designated as net investment hedging instruments, net of tax, on the Consolidated Statements of Income (Loss) and Comprehensive Loss for the three and nine months ended September 30, 2023 and 2022: Amount of Gain (Loss) Location of Gain (Loss) Amount of Gain (Loss) Three Months Ended September 30, Three Months Ended September 30, (DOLLARS IN MILLIONS) 2023 2022 2023 2022 Derivatives in Net Investment Hedging Relationships: Cross currency swaps $ 22 $ (36) N/A $ — $ — Non-Derivatives in Net Investment Hedging Relationships: 2024 Euro Notes 15 30 N/A — — 2026 Euro Notes 25 48 N/A — — Total $ 62 $ 42 $ — $ — Amount of Gain (Loss) Location of Gain (Loss) Amount of Gain (Loss) Nine Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Derivatives in Net Investment Hedging Relationships: Cross currency swaps $ (11) $ 12 N/A $ — $ — Non-Derivatives in Net Investment Hedging Relationships: 2024 Euro Notes 4 60 N/A — — 2026 Euro Notes 7 96 N/A — — Total $ — $ 168 $ — $ — |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Schedule of Changes in Accumulated Other Comprehensive Income (Loss) | The following tables present changes in the accumulated balances for each component of other comprehensive (loss) income, including current period other comprehensive (loss) income and reclassifications out of accumulated other comprehensive loss: (DOLLARS IN MILLIONS) Foreign Gains (Losses) Pension and Total Accumulated other comprehensive (loss) income, net of tax, as of December 31, 2022 $ (2,066) $ 1 $ (133) $ (2,198) OCI before reclassifications (175) — (2) (177) Reclassifications due to business divestitures 43 — (1) 42 Amounts reclassified from AOCI — — (3) (3) Net current period other comprehensive income (loss) (132) — (6) (138) Accumulated other comprehensive (loss) income, net of tax, as of September 30, 2023 $ (2,198) $ 1 $ (139) $ (2,336) (DOLLARS IN MILLIONS) Foreign Gains (Losses) Pension and Total Accumulated other comprehensive (loss) income, net of tax, as of December 31, 2021 $ (1,133) $ 1 $ (291) $ (1,423) OCI before reclassifications (1,770) — (2) (1,772) Amounts reclassified from AOCI — — 8 8 Net current period other comprehensive income (loss) (1,770) — 6 (1,764) Accumulated other comprehensive (loss) income, net of tax, as of September 30, 2022 $ (2,903) $ 1 $ (285) $ (3,187) |
Reclassifications of Accumulated Other Comprehensive Income to Consolidated Statement of Comprehensive Income | The following table provides details about reclassifications out of Accumulated other comprehensive loss to the Consolidated Statements of Income (Loss) and Comprehensive Loss: Nine Months Ended September 30, Affected Line Item in the Consolidated Statements of Income (Loss) and Comprehensive Loss (DOLLARS IN MILLIONS) 2023 2022 Gains (losses) on pension and postretirement liability adjustments Prior service cost $ 4 $ 5 (1) Actuarial losses — (15) (1) Tax (1) 2 Provision for income taxes Total $ 3 $ (8) Total, net of income taxes _______________________ (1) The amortization of prior service cost and actuarial loss is included in the computation of net periodic benefit cost. Refer to Note 15 of the Company’s 2022 Form 10-K for additional information regarding net periodic benefit cost. |
Redeemable Noncontrolling Int_2
Redeemable Noncontrolling Interests (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Noncontrolling Interest [Abstract] | |
Schedule of Redeemable Noncontrolling Interest | The following table sets forth the details of the Company’s redeemable non-controlling interests: (DOLLARS IN MILLIONS) Redeemable Balance at December 31, 2021 $ 105 Impact of foreign exchange translation (4) Share of profit or loss attributable to redeemable non-controlling interests 3 Redemption value adjustment for the current period (3) Exercises of redeemable non-controlling interests (33) Balance at September 30, 2022 $ 68 Balance at December 31, 2022 $ 59 Redemption value adjustment for the current period 1 Balance at September 30, 2023 $ 60 |
Discontinued Operations and D_2
Discontinued Operations and Disposal Groups (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations | The following table summarizes the fair value of sale consideration received in connection with the business divestiture: (DOLLARS IN MILLIONS) Cash proceeds from the buyer $ 190 Amount held in escrow 15 Advance receipt for business to be transferred (1) Direct costs to sell (5) Proceeds attributable to supply agreement (4) Fair value of sale consideration $ 195 (DOLLARS IN MILLIONS) Fair value of sale consideration $ 195 Direct costs to sell 5 Advance receipt for business to be transferred 1 Amount held in escrow (15) Cash transferred to the buyer (1) Net proceeds received from business divestiture $ 185 (DOLLARS IN MILLIONS) August 1, 2023 Assets Cash and cash equivalents $ 1 Trade receivables, net 13 Inventories 45 Property, plant and equipment, net 29 Goodwill 44 Other intangible assets, net 73 Other assets 10 Total assets 215 Liabilities Accounts payable (4) Deferred tax liability (1) Other liabilities (6) Total liabilities (11) Equity Accumulated other comprehensive income - currency translation adjustment 1 Total equity 1 Carrying value of net asset (adjusted for currency translation adjustment) $ 205 The following table summarizes the fair value of sale consideration received in connection with the business divestiture: (DOLLARS IN MILLIONS) Cash proceeds from the buyer $ 840 Receivable from the buyer 30 Direct costs to sell (20) Fair value of sale consideration $ 850 (DOLLARS IN MILLIONS) Fair value of sale consideration $ 850 Direct costs to sell 20 Receivable from the buyer (30) Cash transferred to the buyer (including restricted cash) (19) Net proceeds received from business divestiture $ 821 (DOLLARS IN MILLIONS) May 31, 2023 Assets Cash and cash equivalents $ 15 Restricted cash 4 Trade receivables, net 69 Inventories 116 Property, plant and equipment, net 77 Goodwill 317 Other intangible assets, net 367 Right-of-use assets 20 Other assets 24 Total assets 1,009 Liabilities Accounts payable (44) Deferred tax liability (92) Other liabilities (54) Total liabilities (190) Equity Accumulated other comprehensive income - currency translation adjustment 42 Accumulated other comprehensive income - pension liability and postretirement (1) Total equity 41 Carrying value of net asset (adjusted for currency translation and pension adjustments) $ 860 Included in the Company’s Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022 are the following carrying amounts of the assets and liabilities held for sale: (DOLLARS IN MILLIONS) September 30, 2023 December 31, 2022 (2) Assets Cash and cash equivalents $ 23 $ 52 Trade receivables, net 15 85 Inventories 19 157 Property, plant and equipment, net 7 92 Goodwill 267 348 Other intangible assets, net 141 428 Operating lease right-of-use assets 8 13 Other assets 2 25 Total assets held-for-sale $ 482 $ 1,200 Liabilities Accounts payable $ 4 $ 56 Deferred tax liability (1) 25 92 Other liabilities 20 64 Total liabilities held-for-sale $ 49 $ 212 _______________________ (1) The Company is currently analyzing the tax impact of the sale transaction and has included preliminary numbers for the deferred tax liability, which are subject to further updates. (2) The amounts for December 31, 2022 represent the carrying amounts of the portion of the Savory Solutions business and FSI business that were classified as held for sale. The Company completed the divestitures of the businesses on May 31, 2023 and August 1, 2023, respectively. Refer to Note 3 for additional information. |
Nature of Operations and Summ_4
Nature of Operations and Summary of Significant Accounting Policies - Additional Information (Details) € in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 EUR (€) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Proceeds From Sale Of Accounts Receivable | $ 1,302 | $ 983 | |||||
Payments To Participate In Factoring Receivable Program | $ 6 | $ 3 | 18 | 6 | |||
Trade receivables before allowance for credit loss | 1,886 | 1,886 | $ 1,871 | ||||
Trade receivables | 1,831 | 1,831 | 1,818 | ||||
Trade receivables allowances | $ 55 | $ 55 | 53 | ||||
Percentage of outstanding receivables by over 365 days | 1% | 1% | 1% | ||||
Impairment of long-lived assets | $ 0 | 0 | $ 0 | 120 | |||
Impairment of goodwill | 0 | 2,250 | 0 | 2,250 | |||
Disposal Group, Including Discontinued Operation, Cash and Cash Equivalents | 23 | 0 | 23 | 0 | 52 | $ 0 | |
Net Cash Provided by (Used in) Operating Activities | 795 | 189 | |||||
Cash, cash equivalents and restricted cash | 662 | 555 | 662 | 555 | 552 | $ 716 | |
Operating lease right-of-use assets | 703 | 703 | 743 | ||||
Operating lease liability | 654 | 654 | 672 | ||||
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | 73 | 154 | |||||
Other assets | 763 | 763 | 689 | ||||
Other liabilities | 475 | 475 | 491 | ||||
Accumulated other comprehensive loss | (2,336) | (2,336) | (2,198) | ||||
Measurement period adjustments | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Operating lease liability | 107 | ||||||
Deferred Income Tax Assets, Net | 9 | ||||||
Previously Reported | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Operating lease right-of-use assets | 636 | ||||||
Operating lease liability | 565 | ||||||
Other assets | 699 | ||||||
Other liabilities | 472 | ||||||
Accumulated other comprehensive loss | (2,169) | ||||||
Russia and Ukraine Conflict | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Trade receivables allowances | 3 | 3 | |||||
Impairment of long-lived assets | 120 | ||||||
Russia and Ukraine Conflict | Property, Plant and Equipment | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Impairment of long-lived assets | 28 | ||||||
Russia and Ukraine Conflict | Finite-Lived Intangible Assets | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Impairment of long-lived assets | 92 | ||||||
Health & Biosciences | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Impairment of goodwill | $ 2,250 | 2,250 | |||||
Trade Accounts Receivable With The Company's Own Factoring Agreements | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Accounts Receivable, Factoring Receivable Program, Maximum Amount | € | € 250 | ||||||
Proceeds From Sale Of Accounts Receivable | 632 | $ 323 | |||||
Accounts Receivable, Held-for-sale | $ 148 | $ 148 | $ 157 |
Nature of Operations and Summ_5
Nature of Operations and Summary of Significant Accounting Policies - Reconciliation of Cash (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 629 | $ 483 | $ 538 | $ 711 |
Disposal Group, Including Discontinued Operation, Cash and Cash Equivalents | 23 | 52 | 0 | 0 |
Restricted cash | 10 | 10 | 10 | 4 |
Restricted cash included in Other assets | 0 | 7 | 7 | 1 |
Cash, cash equivalents and restricted cash | $ 662 | $ 552 | $ 555 | $ 716 |
Nature of Operations and Summ_6
Nature of Operations and Summary of Significant Accounting Policies - Schedule of Bad Debt Reserve (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |
Balance at December 31, 2022 | $ 53 |
Bad debt expense | 9 |
Write-offs | (6) |
Foreign exchange | (1) |
Balance at September 30, 2023 | 55 |
Russia and Ukraine Conflict | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |
Bad debt expense | 8 |
Balance at September 30, 2023 | 3 |
EGYPT | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |
Bad debt expense | $ 13 |
Net Income Per Share - Reconcil
Net Income Per Share - Reconciliation of Shares Used in Computation of Basic and Diluted Net Income Per Share (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net income (loss) attributable to IFF shareholders | $ 25 | $ (2,197) | $ 43 | $ (1,846) |
Adjustment related to (increase) decrease in redemption value of redeemable noncontrolling interests in excess of earnings allocated | 0 | 1 | (1) | 3 |
Net income (loss) available to IFF shareholders | $ 25 | $ (2,196) | $ 42 | $ (1,843) |
Weighted average common shares outstanding (basic) (in shares) | 255,000,000 | 255,000,000 | 255,000,000 | 255,000,000 |
Weighted average shares assuming dilution (diluted) (in shares) | 256,000,000 | 255,000,000 | 255,000,000 | 255,000,000 |
Net income per share - basic (in dollars per share) | $ 0.10 | $ (8.60) | $ 0.16 | $ (7.22) |
Net income per share - diluted (in dollars per share) | $ 0.10 | $ (8.60) | $ 0.16 | $ (7.22) |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 300,000 | 400,000 | ||
Stock options and restricted stock awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Adjustment for assumed dilution (in shares) | 1,000,000 | 0 | 0 | 0 |
Net Income Per Share - Addition
Net Income Per Share - Additional Information (Detail) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Dividends declared per share, in dollars per share | $ 0.81 | $ 0.81 | $ 2.43 | $ 2.39 |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 300,000 | 400,000 | ||
Participating Securities, Distributed and Undistributed Earnings (Loss), Difference Between Basic Net Income (Loss) Per Share | 0.01 | $ 0 | 0.01 | $ 0 |
Participating Securities, Distributed and Undistributed Earnings (Loss), Difference Between Diluted Net Income (Loss) Per Share | $ 0.01 | $ 0 | $ 0.01 | $ 0 |
Share Equivalents | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 400,000 | 300,000 | 400,000 | 300,000 |
Business Divestiture - Narrativ
Business Divestiture - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | 21 Months Ended | |||||
Aug. 01, 2023 | May 31, 2023 | Jul. 01, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Sep. 30, 2023 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Proceeds from divestiture of business | $ 1,006 | $ 1,158 | |||||||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Flavor Specialty Ingredients | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Proceeds from divestiture of business | $ 190 | ||||||||
Advance receipt for business to be transferred | 1 | ||||||||
Supply agreement adjustment | 4 | ||||||||
Amount held in escrow | 15 | ||||||||
Carrying value of net asset (adjusted for currency translation and pension adjustments) | 205 | ||||||||
Loss on divestiture | $ (10) | (10) | |||||||
Tax effect of gain (loss) on divestiture | $ 3 | $ 15 | |||||||
Net proceeds received from business divestiture | $ 185 | ||||||||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Savory Solutions Business | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Proceeds from divestiture of business | $ 840 | ||||||||
Carrying value of net asset (adjusted for currency translation and pension adjustments) | 860 | ||||||||
Loss on divestiture | (10) | ||||||||
Tax effect of gain (loss) on divestiture | $ 72 | $ 88 | |||||||
Receivable from the buyer | 30 | ||||||||
Disposal, pretax loss | 10 | ||||||||
Disposal, tax effect | 2 | ||||||||
Net proceeds received from business divestiture | $ 821 | ||||||||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Microbial Control | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Net proceeds received from business divestiture | $ 1,169 | ||||||||
Transition services agreements, term | 19 months | ||||||||
Transition services agreement, fair value | $ 36 | ||||||||
Transaction service agreement, income, reduction to costs not included in revenue | $ 6 | $ 6 | $ 19 | $ 6 |
Business Divestiture - Fair Val
Business Divestiture - Fair Value of Sale Consideration Received (Details) - Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations - USD ($) $ in Millions | Aug. 01, 2023 | May 31, 2023 |
Flavor Specialty Ingredients | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Cash proceeds from the buyer | $ 190 | |
Amount held in escrow | 15 | |
Advance receipt for business to be transferred | (1) | |
Direct costs to sell | (5) | |
Proceeds attributable to supply agreement | (4) | |
Fair value of sale consideration | $ 195 | |
Savory Solutions Business | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Cash proceeds from the buyer | $ 840 | |
Receivable from the buyer | 30 | |
Direct costs to sell | (20) | |
Fair value of sale consideration | $ 850 |
Business Divestiture - Summary
Business Divestiture - Summary of Components of Net Proceeds Received (Details) - Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations - USD ($) $ in Millions | Aug. 01, 2023 | May 31, 2023 |
Savory Solutions Business | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Fair value of sale consideration | $ 850 | |
Receivable from the buyer | (30) | |
Cash transferred to the buyer | (19) | |
Direct costs to sell | 20 | |
Net proceeds received from business divestiture | $ 821 | |
Flavor Specialty Ingredients | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Fair value of sale consideration | $ 195 | |
Advance receipt for business to be transferred | 1 | |
Amount held in escrow | (15) | |
Cash transferred to the buyer | (1) | |
Direct costs to sell | 5 | |
Net proceeds received from business divestiture | $ 185 |
Business Divestiture - Major Cl
Business Divestiture - Major Classes of Assets and Liabilities Sold (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Aug. 01, 2023 | May 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
ASSETS | ||||||
Cash and cash equivalents | $ 629 | $ 483 | $ 538 | $ 711 | ||
Restricted cash | 10 | 10 | $ 10 | $ 4 | ||
Trade receivables, net | 1,831 | 1,818 | ||||
Inventories | 2,549 | 3,151 | ||||
Property, plant and equipment, net | 4,126 | 4,203 | ||||
Goodwill | 13,031 | 13,355 | ||||
Other intangible assets, net | 8,381 | 9,082 | ||||
Operating lease right-of-use assets | 703 | 743 | ||||
Other assets | 763 | 689 | ||||
Total Assets | 33,395 | 35,504 | ||||
Liabilities | ||||||
Accounts payable | (1,112) | (1,418) | ||||
Deferred income taxes | (2,127) | (2,265) | ||||
Other liabilities | (475) | (491) | ||||
Equity | ||||||
Total Shareholders’ Equity | $ 16,978 | $ 17,655 | ||||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Savory Solutions Business | ||||||
ASSETS | ||||||
Cash and cash equivalents | $ 15 | |||||
Restricted cash | 4 | |||||
Trade receivables, net | 69 | |||||
Inventories | 116 | |||||
Property, plant and equipment, net | 77 | |||||
Goodwill | 317 | |||||
Other intangible assets, net | 367 | |||||
Operating lease right-of-use assets | 20 | |||||
Other assets | 24 | |||||
Total Assets | 1,009 | |||||
Liabilities | ||||||
Accounts payable | (44) | |||||
Deferred income taxes | (92) | |||||
Other liabilities | (54) | |||||
Liabilities | (190) | |||||
Equity | ||||||
Accumulated other comprehensive income - currency translation adjustment | 42 | |||||
Accumulated other comprehensive income - pension liability and postretirement | (1) | |||||
Total Shareholders’ Equity | 41 | |||||
Carrying value of net asset (adjusted for currency translation and pension adjustments) | $ 860 | |||||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Flavor Specialty Ingredients | ||||||
ASSETS | ||||||
Cash and cash equivalents | $ 1 | |||||
Trade receivables, net | 13 | |||||
Inventories | 45 | |||||
Property, plant and equipment, net | 29 | |||||
Goodwill | 44 | |||||
Other intangible assets, net | 73 | |||||
Other assets | 10 | |||||
Total Assets | 215 | |||||
Liabilities | ||||||
Accounts payable | (4) | |||||
Deferred income taxes | (1) | |||||
Other liabilities | (6) | |||||
Liabilities | (11) | |||||
Equity | ||||||
Accumulated other comprehensive income - currency translation adjustment | 1 | |||||
Total Shareholders’ Equity | 1 | |||||
Carrying value of net asset (adjusted for currency translation and pension adjustments) | $ 205 |
Restructuring and Other Charg_3
Restructuring and Other Charges, Net - Additional Information (Detail) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 USD ($) | Mar. 31, 2023 USD ($) Facility | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) Position position | Sep. 30, 2022 USD ($) | |
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | $ 2 | $ (4) | $ 61 | $ 5 | |
Additional Charges (Reversals), Net | 61 | ||||
Nutrition & Biosciences, Inc | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 47 | ||||
Additional Charges (Reversals), Net | $ 2 | ||||
Number of positions eliminated | Position | 215 | ||||
Frutarom Integration Initiative | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Number of facilities closed | Facility | 22 | ||||
Restructuring charges | $ 36 | ||||
2023 Restructuring Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Severance costs | $ 63 | ||||
Number of positions eliminated | position | 605 | ||||
Employee Severance | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Additional Charges (Reversals), Net | $ (1) | ||||
Employee Severance | Nutrition & Biosciences, Inc | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Additional Charges (Reversals), Net | 0 | ||||
Employee Severance | Frutarom Integration Initiative | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Additional Charges (Reversals), Net | (3) | ||||
Employee Severance | 2023 Restructuring Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Additional Charges (Reversals), Net | 63 | ||||
Other | Nutrition & Biosciences, Inc | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Additional Charges (Reversals), Net | $ 2 |
Restructuring and Other Charg_4
Restructuring and Other Charges, Net - Changes in Employee-Related Restructuring Liabilities (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Restructuring Reserve [Roll Forward] | |||||
Beginning Balance | $ 15 | $ 15 | |||
Additional Charges (Reversals), Net | 61 | ||||
Non-Cash Charges | (2) | ||||
Additional charges, net | $ 2 | $ (4) | 61 | $ 5 | |
Payments | (49) | ||||
Ending Balance | 25 | 25 | |||
Nutrition & Biosciences, Inc | |||||
Restructuring Reserve [Roll Forward] | |||||
Additional Charges (Reversals), Net | 2 | ||||
Additional charges, net | 47 | ||||
Employee Severance | |||||
Restructuring Reserve [Roll Forward] | |||||
Beginning Balance | 1 | 1 | |||
Additional Charges (Reversals), Net | (1) | ||||
Non-Cash Charges | 0 | ||||
Payments | 0 | ||||
Ending Balance | 0 | 0 | |||
Employee Severance | Nutrition & Biosciences, Inc | |||||
Restructuring Reserve [Roll Forward] | |||||
Beginning Balance | 9 | 9 | |||
Additional Charges (Reversals), Net | 0 | ||||
Non-Cash Charges | 0 | ||||
Payments | (8) | ||||
Ending Balance | 1 | 1 | |||
Other | Nutrition & Biosciences, Inc | |||||
Restructuring Reserve [Roll Forward] | |||||
Beginning Balance | 1 | 1 | |||
Additional Charges (Reversals), Net | 2 | ||||
Non-Cash Charges | (2) | ||||
Payments | (1) | ||||
Ending Balance | 0 | 0 | |||
Frutarom Integration Initiative | |||||
Restructuring Reserve [Roll Forward] | |||||
Additional charges, net | 36 | ||||
Frutarom Integration Initiative | Employee Severance | |||||
Restructuring Reserve [Roll Forward] | |||||
Beginning Balance | 4 | 4 | |||
Additional Charges (Reversals), Net | (3) | ||||
Non-Cash Charges | 0 | ||||
Payments | (1) | ||||
Ending Balance | 0 | 0 | |||
2023 Restructuring Program | Employee Severance | |||||
Restructuring Reserve [Roll Forward] | |||||
Beginning Balance | $ 0 | 0 | |||
Additional Charges (Reversals), Net | 63 | ||||
Non-Cash Charges | 0 | ||||
Payments | (39) | ||||
Ending Balance | 24 | 24 | |||
Nourish | |||||
Restructuring Reserve [Roll Forward] | |||||
Additional charges, net | 1 | 0 | 33 | 3 | |
Scent | |||||
Restructuring Reserve [Roll Forward] | |||||
Additional charges, net | 0 | (5) | 14 | 0 | |
Health & Biosciences | |||||
Restructuring Reserve [Roll Forward] | |||||
Additional charges, net | 1 | 1 | 12 | 2 | |
Pharma Solutions | |||||
Restructuring Reserve [Roll Forward] | |||||
Additional charges, net | $ 0 | $ 0 | $ 2 | $ 0 |
Property, Plant, and Equipmen_2
Property, Plant, and Equipment (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |||||
Depreciation | $ 122 | $ 111 | $ 342 | $ 345 | |
Property, plant and equipment, at cost | 6,368 | 6,368 | $ 6,180 | ||
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | (2,242) | (2,242) | (1,977) | ||
Property, plant and equipment, net | 4,126 | 4,126 | 4,203 | ||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, at cost | 6,368 | 6,368 | 6,180 | ||
Property, Plant and Equipment | Russia and Ukraine Conflict | |||||
Property, Plant and Equipment [Line Items] | |||||
Impairment of long-lived assets | $ 28 | ||||
Land | |||||
Property, Plant and Equipment [Abstract] | |||||
Property, plant and equipment, at cost | 191 | 191 | 199 | ||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, at cost | 191 | 191 | 199 | ||
Building and Building Improvements | |||||
Property, Plant and Equipment [Abstract] | |||||
Property, plant and equipment, at cost | 1,721 | 1,721 | 1,697 | ||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, at cost | 1,721 | 1,721 | 1,697 | ||
Machinery and Equipment | |||||
Property, Plant and Equipment [Abstract] | |||||
Property, plant and equipment, at cost | 3,575 | 3,575 | 3,344 | ||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, at cost | 3,575 | 3,575 | 3,344 | ||
Technology Equipment | |||||
Property, Plant and Equipment [Abstract] | |||||
Property, plant and equipment, at cost | 386 | 386 | 291 | ||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, at cost | 386 | 386 | 291 | ||
Construction in Progress | |||||
Property, Plant and Equipment [Abstract] | |||||
Property, plant and equipment, at cost | 495 | 495 | 649 | ||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, at cost | $ 495 | $ 495 | $ 649 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets, Net - Movements in Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Goodwill [Roll Forward] | |||||
Balance at December 31, 2022 | $ 13,355 | ||||
Reduction from business divestitures | 4 | ||||
Foreign exchange | (53) | ||||
Balance at September 30, 2023 | $ 13,031 | 13,031 | |||
Goodwill, impairment loss | 0 | $ (2,250) | 0 | $ (2,250) | |
Goodwill, Transfers | (267) | ||||
Nourish | |||||
Goodwill [Roll Forward] | |||||
Balance at December 31, 2022 | 6,050 | ||||
Reduction from business divestitures | 4 | ||||
Foreign exchange | (41) | ||||
Balance at September 30, 2023 | 6,005 | 6,005 | |||
Goodwill, Transfers | 0 | ||||
Health & Biosciences | |||||
Goodwill [Roll Forward] | |||||
Balance at December 31, 2022 | 4,321 | ||||
Reduction from business divestitures | 0 | ||||
Foreign exchange | (7) | ||||
Balance at September 30, 2023 | 4,314 | 4,314 | |||
Goodwill, impairment loss | $ (2,250) | $ (2,250) | |||
Goodwill, Transfers | 0 | ||||
Goodwill, Impaired, Accumulated Impairment Loss | 2,250 | 2,250 | $ 2,250 | ||
Scent | |||||
Goodwill [Roll Forward] | |||||
Balance at December 31, 2022 | 1,745 | ||||
Reduction from business divestitures | 0 | ||||
Foreign exchange | (2) | ||||
Balance at September 30, 2023 | 1,476 | 1,476 | |||
Goodwill, Transfers | (267) | ||||
Pharma Solutions | |||||
Goodwill [Roll Forward] | |||||
Balance at December 31, 2022 | 1,239 | ||||
Reduction from business divestitures | 0 | ||||
Foreign exchange | (3) | ||||
Balance at September 30, 2023 | $ 1,236 | 1,236 | |||
Goodwill, Transfers | $ 0 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets, Net - Schedule of Other Intangible Assets, Net (Detail) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Total carrying value | $ 10,761 | $ 11,062 |
Total accumulated amortization | (2,380) | (1,980) |
Other intangible assets, net | 8,381 | 9,082 |
Other Intangible Assets, Net | 8,381 | 9,082 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total carrying value | 8,072 | 8,318 |
Total accumulated amortization | (1,488) | (1,252) |
Technological know-how | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total carrying value | 2,314 | 2,339 |
Total accumulated amortization | (745) | (589) |
Trade names & patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total carrying value | 331 | 358 |
Total accumulated amortization | (107) | (97) |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total carrying value | 44 | 47 |
Total accumulated amortization | $ (40) | $ (42) |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets, Net - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Goodwill [Line Items] | |||||
Goodwill | $ 13,031 | $ 13,031 | $ 13,355 | ||
Impairment of goodwill | 0 | $ 2,250 | 0 | $ 2,250 | |
Amortization of acquisition-related intangibles | 170 | 182 | 513 | 552 | |
Finite-Lived Intangible Assets | Russia and Ukraine Conflict | |||||
Goodwill [Line Items] | |||||
Impairment of long-lived assets | 92 | ||||
Health & Biosciences | |||||
Goodwill [Line Items] | |||||
Goodwill | 4,314 | 4,314 | 4,321 | ||
Impairment of goodwill | $ 2,250 | $ 2,250 | |||
Goodwill, Impaired, Accumulated Impairment Loss | $ 2,250 | $ 2,250 | $ 2,250 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets, Net - Future Estimated Amortization Expense (Details) $ in Millions | Sep. 30, 2023 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2023 | $ 173 |
2024 | 692 |
2025 | 690 |
2026 | 688 |
2027 | $ 589 |
Other Assets and Liabilities,_3
Other Assets and Liabilities, Current and Noncurrent - Schedule of Other Assets (Detail) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Other Assets [Abstract] | ||
Finance lease right-of-use assets | $ 25 | $ 22 |
Deferred Income Taxes and Other Assets, Noncurrent | 212 | 167 |
Overfunded pension plans | 202 | 180 |
Cash surrender value of life insurance contracts | 46 | 45 |
Other | 268 | 265 |
Total | 763 | 689 |
Value Added Tax Receivable, Current | 159 | 212 |
Income Taxes Receivable, Current | 224 | 129 |
Prepaid Supplies | 157 | 148 |
Prepaid Expense, Current | 184 | 144 |
Assets held for sale | 482 | 1,200 |
Accounts and Other Receivables, Net, Current | 166 | 137 |
Prepaid expenses and other current assets | 890 | 770 |
Sales and Excise Tax Payable, Current | 62 | 65 |
Interest Payable, Current | 74 | 55 |
Liability, Pension and Other Postretirement and Postemployment Benefits, Current | 5 | 10 |
Accrued Insurance, Current | 10 | 9 |
Earn Outs Payable, Current | 31 | 0 |
Restructuring Reserve | 25 | 15 |
Other current liabilities | 83 | 86 |
Accrued Freight, Current | 12 | 18 |
Accrued Commissions Payable, Current | 10 | 11 |
Accrued Income Taxes, Current | 118 | 313 |
Liabilities held for sale | 49 | 212 |
Other Accounts Payable and Accrued Liabilities | 263 | 256 |
Other Sundry Liabilities, Current | 145 | 91 |
Other current liabilities | 937 | 1,028 |
Rebates and Incentives Payable, Current | 99 | 99 |
Equity method investment | $ 10 | $ 10 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other current liabilities | Other current liabilities |
Debt - Components of Debt (Deta
Debt - Components of Debt (Detail) - USD ($) $ in Millions | Jul. 28, 2021 | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | |||
Commercial paper | $ 0 | $ 187 | |
Total debt | 10,301 | 10,970 | |
Less: Short term borrowings | (1,142) | (597) | |
Total Long-term debt | $ 9,159 | 10,373 | |
Revolving Credit Facility | Minimum | Base rate | Citibank, N.A. | |||
Debt Instrument [Line Items] | |||
Applicable margin on variable rate, percent | 0% | ||
Revolving Credit Facility | Minimum | Eurocurrency Rate | Citibank, N.A. | |||
Debt Instrument [Line Items] | |||
Applicable margin on variable rate, percent | 1% | ||
Revolving Credit Facility | Maximum | Base rate | Citibank, N.A. | |||
Debt Instrument [Line Items] | |||
Applicable margin on variable rate, percent | 0.625% | ||
Revolving Credit Facility | Maximum | Eurocurrency Rate | Citibank, N.A. | |||
Debt Instrument [Line Items] | |||
Applicable margin on variable rate, percent | 1.625% | ||
2023 Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 3.30% | ||
Senior notes, current | $ 0 | 300 | |
2024 Euro Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 1.88% | ||
Senior notes, current | $ 525 | ||
2024 Euro Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Senior notes, noncurrent | 532 | ||
2025 Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 1.22% | ||
Senior notes, noncurrent | $ 1,000 | 1,000 | |
2026 Euro Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 1.93% | ||
Senior notes, noncurrent | $ 836 | 845 | |
2027 Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 1.56% | ||
Senior notes, noncurrent | $ 1,213 | 1,215 | |
2028 Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 4.57% | ||
Senior notes, noncurrent | $ 398 | 398 | |
2030 Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 2.21% | ||
Senior notes, noncurrent | $ 1,509 | 1,510 | |
2040 Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 3.04% | ||
Senior notes, noncurrent | $ 773 | 774 | |
2047 Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 4.44% | ||
Senior notes, noncurrent | $ 495 | 495 | |
2048 Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 5.12% | ||
Senior notes, noncurrent | $ 787 | 787 | |
2050 Notes | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 3.21% | ||
Senior notes, noncurrent | $ 1,570 | 1,571 | |
2024 Term Loan Facility | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 6.50% | ||
Senior notes, current | $ 570 | ||
2024 Term Loan Facility | Loans payable | |||
Debt Instrument [Line Items] | |||
Senior notes, noncurrent | 625 | ||
2026 Term Loan Facility | Loans payable | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 5.41% | ||
Senior notes, noncurrent | $ 625 | 625 | |
Bank overdrafts and other | |||
Debt Instrument [Line Items] | |||
Bank overdrafts and other | 0 | 6 | |
Revolving Credit Facility | Loans payable | |||
Debt Instrument [Line Items] | |||
Long-term line of credit | $ 0 | $ 100 |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 6 Months Ended | 9 Months Ended | ||||
Sep. 29, 2023 | Sep. 19, 2023 | May 01, 2023 | Sep. 30, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | |
Debt Instrument [Line Items] | ||||||
Proceeds from issuance of commercial paper (maturities after three months) | $ 4,283 | $ 4,725 | ||||
Repayments of commercial paper | 4,470 | 4,845 | ||||
Revolving Credit Facility | Citibank, N.A. | ||||||
Debt Instrument [Line Items] | ||||||
Proceeds from lines of credit | 800 | 350 | ||||
Repayments of lines of credit | $ 900 | $ 350 | ||||
Term loan credit agreement | ||||||
Debt Instrument [Line Items] | ||||||
Maximum dividend threshold per quarter (in dollars per share) | $ 0.81 | |||||
Maximum dividend threshold per year (in dollars per share) | $ 3.24 | |||||
Term loan covenant, amount | $ 300 | |||||
Term loan covenant, lien threshold, percentage of consolidated net tangible assets | 3.65% | |||||
Percentage of proceeds From non-ordinary assets sales required to be used as prepayment | 1 | |||||
Basis spread increase on variable rate | 0.00125 | |||||
Term loan credit agreement | Secured Overnight Financing Rate (SOFR) | ||||||
Debt Instrument [Line Items] | ||||||
Adjustment on variable rate, percent | 0.10% | |||||
Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Maximum dividend threshold per quarter (in dollars per share) | $ 0.81 | |||||
Maximum dividend threshold per year (in dollars per share) | $ 3.24 | |||||
Term loan covenant, amount | $ 300 | |||||
Term loan covenant, lien threshold, percentage of consolidated net tangible assets | 3.65% | |||||
Basis spread increase on variable rate | 0.00125 | |||||
Revolving Credit Facility | Loans payable | Citibank, N.A. | ||||||
Debt Instrument [Line Items] | ||||||
Proceeds from lines of credit | $ 400 | |||||
Revolving Credit Facility | Euro Interbank Offered Rate | ||||||
Debt Instrument [Line Items] | ||||||
Adjustment on variable rate, percent | 0.10% | |||||
Revolving Credit Facility | Secured Overnight Financing Rate (SOFR) | ||||||
Debt Instrument [Line Items] | ||||||
Adjustment on variable rate, percent | 0.10% | |||||
2023 Notes | Loans payable | ||||||
Debt Instrument [Line Items] | ||||||
Repayments of debt | $ 300 | |||||
2024 Term Loan Facility | Loans payable | ||||||
Debt Instrument [Line Items] | ||||||
Repayments of debt | $ 55 | |||||
Fiscal Quarter Ending June 30, 2024 | Term loan credit agreement | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 475% | |||||
Fiscal Quarter Ending June 30, 2024 | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 475% | |||||
Fiscal Quarter Ending September 30, 2024 | Term loan credit agreement | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 450% | |||||
Fiscal Quarter Ending September 30, 2024 | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 450% | |||||
Fiscal Quarter Ending On Or Before March 31, 2024 | Term loan credit agreement | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 525% | |||||
Fiscal Quarter Ending On Or Before March 31, 2024 | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 525% | |||||
Subsequent Fiscal Quarter Ending On Or Before March 31, 2025 | Term loan credit agreement | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 425% | |||||
Subsequent Fiscal Quarter Ending On Or Before March 31, 2025 | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 425% | |||||
Subsequent Fiscal Quarter Ending On Or Before September 30, 2025 | Term loan credit agreement | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 400% | |||||
Subsequent Fiscal Quarter Ending On Or Before September 30, 2025 | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 400% | |||||
Fiscal Quarter Ending December 31, 2025 | Term loan credit agreement | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 375% | |||||
Fiscal Quarter Ending December 31, 2025 | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Term loan covenant, maximum consolidated leverage ratio | 375% |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Lessee, Lease, Description [Line Items] | ||
Remaining lease term | 50 years | |
Option to extend lease term | 15 years | |
Operating lease liability | $ 654 | $ 672 |
Operating lease right-of-use assets | 703 | 743 |
Finance lease right-of-use assets | $ 25 | $ 22 |
Leases - Lease expenses (Detail
Leases - Lease expenses (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Leases [Abstract] | ||||
Operating lease cost | $ 32 | $ 31 | $ 105 | $ 99 |
Variable lease cost | 10 | 12 | 42 | 36 |
Total operating lease cost | 42 | 43 | 147 | 135 |
Finance lease cost | $ 3 | $ 2 | $ 7 | $ 6 |
Leases - Supplemental cash flow
Leases - Supplemental cash flow information (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Leases [Abstract] | ||
Operating cash flows for operating leases | $ 94 | $ 102 |
Operating cash flows for finance leases | 1 | 0 |
Financing cash flows for finance leases | 6 | 5 |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | 73 | 154 |
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability | $ 17 | $ 4 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2023 USD ($) | Sep. 30, 2023 USD ($) | |
Income Taxes [Line Items] | ||
Domestic earnings repatriated | $ 153,000,000 | $ 153,000,000 |
Undistributed foreign earnings | $ 0 | $ 0 |
Effective tax rate | 54.20% | 62.60% |
Foreign Tax Authority | ||
Income Taxes [Line Items] | ||
Provision for uncertain tax positions | $ 156,000,000 | $ 156,000,000 |
Other Liabilities | ||
Income Taxes [Line Items] | ||
Unrecognized tax benefits that would impact effective tax rate | 111,000,000 | 111,000,000 |
Accrued interest and penalties | 38,000,000 | 38,000,000 |
Other Current Liabilities | ||
Income Taxes [Line Items] | ||
Unrecognized tax benefits that would impact effective tax rate | 5,000,000 | 5,000,000 |
Accrued interest and penalties | $ 2,000,000 | $ 2,000,000 |
Stock Compensation Plans - Stoc
Stock Compensation Plans - Stock-Based Compensation Expense and Related Tax Benefits (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 18 | $ 11 | $ 50 | $ 37 |
Less: Tax benefit | (5) | (2) | (11) | (7) |
Total stock-based compensation expense, after tax | 13 | 9 | 39 | 30 |
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount | 90 | 90 | ||
Equity-based awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 18 | 12 | 50 | 37 |
Liability-based awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 0 | $ (1) | $ 0 | $ 0 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) category segment | Sep. 30, 2022 USD ($) | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Number of segments | segment | 4 | |||
Number of categories | category | 2 | |||
Business divestiture costs | $ 29 | $ 31 | $ 70 | $ 91 |
Integration-related costs | 12 | 25 | 42 | 73 |
Transaction related costs | $ 1 | $ 1 | $ 6 | $ 3 |
Net sales attributed to all foreign countries | Sales | Customer Concentration Risk | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Maximum percentage of total consolidated net sales attributed to any non-U.S. country | 7% | 6% | 7% | 6% |
Segment Information - Reportabl
Segment Information - Reportable Segment Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Net sales: | ||||
Net sales | $ 2,820 | $ 3,063 | $ 8,776 | $ 9,596 |
Segment Adjusted Operating EBITDA: | ||||
Adjusted Operating EBITDA | 506 | 612 | 1,519 | 2,014 |
Other Depreciation and Amortization | 292 | 293 | 855 | 897 |
Interest expense | (110) | (83) | (337) | (232) |
Other income, net | 19 | 33 | 34 | 43 |
Restructuring and other charges, net | (2) | 4 | (61) | (5) |
Impairment of goodwill | 0 | 2,250 | 0 | 2,250 |
Acquisition, divestiture, and integration related costs | 42 | 57 | 118 | 167 |
Strategic initiative costs | (6) | (1) | (28) | (1) |
Regulatory costs | (13) | 0 | (32) | 0 |
Other gains (losses) | 1 | 0 | (1) | 5 |
Income before taxes | 59 | (2,035) | 123 | (1,620) |
Business divestiture costs | (29) | (31) | (70) | (91) |
Integration-related costs | (12) | (25) | (42) | (73) |
Transaction related costs | (1) | (1) | (6) | (3) |
Impairment of long-lived assets | 0 | 0 | 0 | (120) |
Nourish | ||||
Segment Adjusted Operating EBITDA: | ||||
Restructuring and other charges, net | (1) | 0 | (33) | (3) |
Health & Biosciences | ||||
Segment Adjusted Operating EBITDA: | ||||
Restructuring and other charges, net | (1) | (1) | (12) | (2) |
Impairment of goodwill | 2,250 | 2,250 | ||
Scent | ||||
Segment Adjusted Operating EBITDA: | ||||
Restructuring and other charges, net | 0 | 5 | (14) | 0 |
Pharma Solutions | ||||
Segment Adjusted Operating EBITDA: | ||||
Restructuring and other charges, net | 0 | 0 | (2) | 0 |
Operating Segments | Nourish | ||||
Net sales: | ||||
Net sales | 1,449 | 1,703 | 4,666 | 5,252 |
Segment Adjusted Operating EBITDA: | ||||
Segment Adjusted Operating EBITDA | 178 | 287 | 567 | 981 |
Operating Segments | Health & Biosciences | ||||
Net sales: | ||||
Net sales | 518 | 512 | 1,553 | 1,838 |
Segment Adjusted Operating EBITDA: | ||||
Segment Adjusted Operating EBITDA | 150 | 137 | 426 | 513 |
Operating Segments | Scent | ||||
Net sales: | ||||
Net sales | 615 | 591 | 1,815 | 1,756 |
Segment Adjusted Operating EBITDA: | ||||
Segment Adjusted Operating EBITDA | 131 | 119 | 353 | 328 |
Operating Segments | Pharma Solutions | ||||
Net sales: | ||||
Net sales | 238 | 257 | 742 | 750 |
Segment Adjusted Operating EBITDA: | ||||
Segment Adjusted Operating EBITDA | $ 47 | $ 69 | $ 173 | $ 192 |
Segment Information Segment Inf
Segment Information Segment Information - Net Sales by Destination of Product Delivery (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | $ 2,820 | $ 3,063 | $ 8,776 | $ 9,596 |
Europe, Africa and Middle East | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 918 | 1,030 | 2,958 | 3,258 |
Greater Asia | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 670 | 701 | 2,031 | 2,200 |
North America | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 853 | 939 | 2,668 | 3,006 |
Latin America | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 379 | 393 | 1,119 | 1,132 |
Geographic Concentration Risk | Net sales related to the U.S. | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 782 | 920 | 2,430 | 2,799 |
Geographic Concentration Risk | Net sales attributed to all foreign countries | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | $ 2,038 | $ 2,143 | $ 6,346 | $ 6,797 |
Customer Concentration Risk | Net sales attributed to all foreign countries | Sales | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Maximum percentage of total consolidated net sales attributed to any non-U.S. country | 7% | 6% | 7% | 6% |
Employee Benefits - Pension and
Employee Benefits - Pension and Other Defined Contribution Retirement Plan Expenses (Detail) - Pension Plans - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
U.S. Plans | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost for benefits earned | $ 0 | $ 1 | $ 0 | $ 1 |
Interest cost on projected benefit obligation | 6 | 4 | 19 | 12 |
Expected return on plan assets | (7) | (5) | (23) | (16) |
Net amortization and deferrals | 0 | 1 | 1 | 5 |
Net periodic benefit (income) cost | (1) | 1 | (3) | 2 |
Non-U.S. Plans | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost for benefits earned | 5 | 9 | 15 | 28 |
Interest cost on projected benefit obligation | 9 | 4 | 27 | 13 |
Expected return on plan assets | (11) | (10) | (34) | (32) |
Net amortization and deferrals | 0 | 3 | (1) | 9 |
Net periodic benefit (income) cost | $ 3 | $ 6 | 7 | $ 18 |
Contribution to the plans | $ 22 |
Employee Benefits - Additional
Employee Benefits - Additional Information (Detail) - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Assets for Plan Benefits, Defined Benefit Plan | $ 202,000,000 | $ 180,000,000 |
Defined Contribution and Other Retirement Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Expected contribution to the plan | 3,000,000 | |
Contribution to the plans | 2,000,000 | |
U.S. Plans | Qualified Plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Benefit payments | 0 | |
U.S. Plans | Pension Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Expected contribution to the plan | 5,000,000 | |
U.S. Plans | Nonqualified Plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Benefit payments | 3,000,000 | |
Non-U.S. Plans | Pension Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Expected contribution to the plan | 32,000,000 | |
Contribution to the plans | $ 22,000,000 |
Employee Benefits - Postretirem
Employee Benefits - Postretirement Benefits Other Than Pension Expenses (Detail) - Defined Contribution and Other Retirement Plans - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost for benefits earned | $ 0 | $ 1 | $ 0 | $ 1 |
Interest cost on projected benefit obligation | 0 | 0 | 2 | 1 |
Net amortization and deferrals | (1) | (2) | (4) | (4) |
Net periodic benefit (income) cost | $ (1) | $ (1) | $ (2) | $ (2) |
Financial Instruments - Carryin
Financial Instruments - Carrying Amount and Estimated Fair Values of Financial Instruments (Detail) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Commercial paper | $ 0 | $ 187 |
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Other current liabilities | Other current liabilities |
Reported Value Measurement | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | $ 629 | $ 483 |
Credit facilities and bank overdrafts | 0 | 106 |
Derivative Asset | 3 | 1 |
Derivative Liability | 126 | 75 |
Commercial paper | 0 | 187 |
Reported Value Measurement | 2023 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, current | 0 | 300 |
Reported Value Measurement | 2024 Euro Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 532 | |
Senior notes, current | 525 | |
Reported Value Measurement | 2026 Euro Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 836 | 845 |
Reported Value Measurement | 2028 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 398 | 398 |
Reported Value Measurement | 2048 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 787 | 787 |
Reported Value Measurement | 2047 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 495 | 495 |
Reported Value Measurement | 2024 Term Loan Facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 625 | |
Senior notes, current | 570 | |
Reported Value Measurement | 2025 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 1,000 | 1,000 |
Reported Value Measurement | 2027 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 1,213 | 1,215 |
Reported Value Measurement | 2030 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 1,509 | 1,510 |
Reported Value Measurement | 2040 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 773 | 774 |
Reported Value Measurement | 2050 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 1,570 | 1,571 |
Reported Value Measurement | 2026 Term Loan Facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 625 | 625 |
Estimate of Fair Value Measurement [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | 629 | 483 |
Credit facilities and bank overdrafts | 0 | 106 |
Derivative Asset | 3 | 1 |
Derivative Liability | 126 | 75 |
Commercial paper | 0 | 187 |
Estimate of Fair Value Measurement [Member] | 2023 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, current | 0 | 298 |
Estimate of Fair Value Measurement [Member] | 2024 Euro Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 519 | |
Senior notes, current | 518 | |
Estimate of Fair Value Measurement [Member] | 2026 Euro Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 757 | 774 |
Estimate of Fair Value Measurement [Member] | 2028 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 367 | 380 |
Estimate of Fair Value Measurement [Member] | 2048 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 598 | 685 |
Estimate of Fair Value Measurement [Member] | 2047 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 336 | 390 |
Estimate of Fair Value Measurement [Member] | 2024 Term Loan Facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 625 | |
Senior notes, current | 570 | |
Estimate of Fair Value Measurement [Member] | 2025 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 897 | 884 |
Estimate of Fair Value Measurement [Member] | 2027 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 995 | 1,006 |
Estimate of Fair Value Measurement [Member] | 2030 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 1,130 | 1,188 |
Estimate of Fair Value Measurement [Member] | 2040 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 468 | 535 |
Estimate of Fair Value Measurement [Member] | 2050 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | 874 | 1,021 |
Estimate of Fair Value Measurement [Member] | 2026 Term Loan Facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Senior notes, noncurrent | $ 625 | $ 625 |
Financial Instruments - Additio
Financial Instruments - Additional Information (Detail) $ in Millions | 6 Months Ended | |
Sep. 30, 2023 USD ($) swap | Dec. 31, 2022 USD ($) | |
Derivative [Line Items] | ||
Fair value of derivative liabilities | $ 126 | |
Revolving Credit Facility | Euro Interbank Offered Rate | ||
Derivative [Line Items] | ||
Applicable margin on variable rate, percent | 0.10% | |
Cross currency swaps | ||
Derivative [Line Items] | ||
Derivative instruments outstanding | $ 1,400 | $ 1,400 |
Fair value of derivative liabilities | 89 | 75 |
2022 Cross Currency Swaps | Net Investment Hedging | ||
Derivative [Line Items] | ||
Derivative instruments outstanding | 1,400 | |
Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Fair value of derivative liabilities | 89 | |
Designated as Hedging Instrument | Euro Notes | ||
Derivative [Line Items] | ||
Hedged liability, debt | 1,361 | |
Designated as Hedging Instrument | Cross currency swaps | ||
Derivative [Line Items] | ||
Fair value of derivative liabilities | $ 89 | $ 75 |
Designated as Hedging Instrument | 2022 Cross Currency Swaps | ||
Derivative [Line Items] | ||
Number of Foreign Currency Derivatives Held | swap | 12 | |
Derivative Assets (Liabilities), at Fair Value, Net | $ 89 |
Financial Instruments - Derivat
Financial Instruments - Derivative Instruments Notional Amount Outstanding (Detail) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Foreign currency contracts(1) | ||
Schedule Of Information By Major Category Of Credit Derivatives Contracts [Line Items] | ||
Derivative instruments outstanding | $ (1,248) | $ 92 |
Commodity contracts | ||
Schedule Of Information By Major Category Of Credit Derivatives Contracts [Line Items] | ||
Derivative instruments outstanding | 13 | (1) |
Cross currency swaps | ||
Schedule Of Information By Major Category Of Credit Derivatives Contracts [Line Items] | ||
Derivative instruments outstanding | $ 1,400 | $ 1,400 |
Financial Instruments - Deriv_2
Financial Instruments - Derivative Instruments Measured at Fair Value (Detail) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative liabilities | $ 126 | |
Foreign currency contracts | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative assets | 3 | $ 1 |
Fair value of derivative liabilities | 37 | |
Cross currency swaps | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative liabilities | 89 | 75 |
Fair Value of Derivatives Designated as Hedging Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative liabilities | 89 | |
Fair Value of Derivatives Designated as Hedging Instruments | Foreign currency contracts | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative assets | 0 | 0 |
Fair value of derivative liabilities | 0 | |
Fair Value of Derivatives Designated as Hedging Instruments | Cross currency swaps | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative liabilities | 89 | 75 |
Fair Value of Derivatives Not Designated as Hedging Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative liabilities | 37 | |
Fair Value of Derivatives Not Designated as Hedging Instruments | Foreign currency contracts | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative assets | 3 | 1 |
Fair value of derivative liabilities | 37 | |
Fair Value of Derivatives Not Designated as Hedging Instruments | Cross currency swaps | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of derivative liabilities | $ 0 | $ 0 |
Financial Instruments - Deriv_3
Financial Instruments - Derivative Instruments Which Were Not Designated as Hedging Instruments (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) on derivative, net | $ (21) | $ 4 | ||
Foreign currency contracts | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) on derivative, net | $ (26) | $ 2 | (23) | 4 |
Commodity contracts | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) on derivative, net | $ 2 | $ 0 |
Financial Instruments - Deriv_4
Financial Instruments - Derivative Instruments Designated Net Investment Hedging Instruments (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized in OCI on Derivative and Non-Derivative (Effective Portion) | $ 62 | $ 42 | $ 0 | $ 168 |
Amount of Gain (Loss) Reclassified from AOCI into Income (Effective Portion) | 0 | 0 | 0 | 0 |
Cross currency swaps | Derivatives in Net Investment Hedging Relationships | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized in OCI on Derivative and Non-Derivative (Effective Portion) | 22 | (36) | (11) | 12 |
2024 Euro Notes | Derivatives in Net Investment Hedging Relationships | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized in OCI on Derivative and Non-Derivative (Effective Portion) | 15 | 30 | 4 | 60 |
2026 Euro Notes | Derivatives in Net Investment Hedging Relationships | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized in OCI on Derivative and Non-Derivative (Effective Portion) | $ 25 | $ 48 | $ 7 | $ 96 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Schedule of Changes in Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Balance, beginning of period | $ 17,655 | |||
Net current period other comprehensive income (loss) | $ (479) | $ (977) | (138) | $ (1,764) |
Balance, end of period | 16,978 | 16,978 | ||
Foreign Currency Translation Adjustments | ||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Balance, beginning of period | (2,066) | (1,133) | ||
OCI before reclassifications | (175) | (1,770) | ||
Reclassifications due to business divestitures | 43 | |||
Amounts reclassified from AOCI | 0 | 0 | ||
Net current period other comprehensive income (loss) | (132) | (1,770) | ||
Balance, end of period | (2,198) | (2,903) | (2,198) | (2,903) |
Gains (Losses) on Derivatives Qualifying as Hedges | ||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Balance, beginning of period | 1 | 1 | ||
OCI before reclassifications | 0 | 0 | ||
Reclassifications due to business divestitures | 0 | |||
Amounts reclassified from AOCI | 0 | 0 | ||
Net current period other comprehensive income (loss) | 0 | 0 | ||
Balance, end of period | 1 | 1 | 1 | 1 |
Pension and Postretirement Liability Adjustment | ||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Balance, beginning of period | (133) | (291) | ||
OCI before reclassifications | (2) | (2) | ||
Reclassifications due to business divestitures | (1) | |||
Amounts reclassified from AOCI | 3 | (8) | ||
Net current period other comprehensive income (loss) | (6) | 6 | ||
Balance, end of period | (139) | (285) | (139) | (285) |
AOCI Attributable to Parent | ||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Balance, beginning of period | (2,198) | (1,423) | ||
OCI before reclassifications | (177) | (1,772) | ||
Reclassifications due to business divestitures | 42 | |||
Amounts reclassified from AOCI | 3 | (8) | ||
Net current period other comprehensive income (loss) | (138) | (1,764) | ||
Balance, end of period | $ (2,336) | $ (3,187) | $ (2,336) | $ (3,187) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) - Reclassifications of Accumulated Other Comprehensive Income to Consolidated Statement of Comprehensive Income (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Schedule Of Reclassification Of Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Foreign currency contracts | $ 1,896 | $ 2,062 | $ 5,955 | $ 6,314 |
Interest Expense | (110) | (83) | (337) | (232) |
Tax | $ 32 | $ 160 | 77 | 220 |
Accumulated Defined Benefit Plans Adjustment, Net Prior Service Attributable to Parent [Member] | ||||
Schedule Of Reclassification Of Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 4 | 5 | ||
Accumulated Defined Benefit Plans Adjustment, Net Gain (Loss) Attributable to Parent [Member] | ||||
Schedule Of Reclassification Of Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 0 | (15) | ||
Pension and Postretirement Liability Adjustment | ||||
Schedule Of Reclassification Of Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Tax | (1) | 2 | ||
Reclassification out of Accumulated Other Comprehensive Income | Pension and Postretirement Liability Adjustment | ||||
Schedule Of Reclassification Of Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Total | $ 3 | $ (8) |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Jun. 05, 2023 | Mar. 11, 2020 | Oct. 29, 2019 | Sep. 30, 2020 | Dec. 31, 2017 | Sep. 30, 2023 | Dec. 31, 2019 | Mar. 31, 2023 | Dec. 31, 2022 | |
Commitments And Contingencies [Line Items] | |||||||||
Bank guarantees related to appeals on income tax and indirect tax cases | $ 10,000,000 | ||||||||
Bank Guarantees and Standby Letters of Credit, Amount Outstanding | 91,000,000 | ||||||||
Available lines of credit | 1,824,000,000 | ||||||||
Commercial paper | 0 | $ 187,000,000 | |||||||
Property, plant and equipment, net | 4,126,000,000 | $ 4,203,000,000 | |||||||
Bank guarantees and pledged assets to pursue defenses related to other contingencies | 18,000,000 | ||||||||
Pharma Solutions | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Malpractice Loss Contingency, Payments, Inception-to-date | 46,000,000 | ||||||||
Pledged assets | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
The amount of pledged assets, principally PP&E to cover income tax and indirect tax assessments | 8,000,000 | ||||||||
Bank Guarantees, Commercial Guarantees, Standby Letters Of Credit and Surety Bonds | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Bank Guarantees, Commercial Guarantees, Letters Of Credit and Surety Bonds Outstanding | 431,000,000 | ||||||||
Brazil Tax Credits | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Loss contingency, receivable written off | $ 6,000,000 | ||||||||
Minimum | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Estimation of possible loss | 0 | ||||||||
Maximum | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Estimation of possible loss | 65,000,000 | ||||||||
Revolving Credit Facility | Citibank, N.A. | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Line of credit, current borrowing capacity | 1,447,000,000 | ||||||||
CHINA | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Property, plant and equipment, net | 209,000,000 | ||||||||
Hangzhou, China | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Property, plant and equipment, net | 53,000,000 | ||||||||
Guangzhou, China | Guangzhou Flavors Plant | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Property, plant and equipment, net | 47,000,000 | ||||||||
Guangzhou, China | Guangzhou Fragrance Plant | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Property, plant and equipment, net | 6,000,000 | ||||||||
Zhejiang, China | Zhejiang Ingredients Plant | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Gain Contingency, Expected Relocation Payments | $ 50,000,000 | ||||||||
Gain Contingency, Relocation Payments Received | $ 5,000,000 | $ 13,000,000 | $ 30,000,000 | ||||||
Gain (loss) on plant relocation | 22,000,000 | ||||||||
Estimated income tax expense (benefit) | 6,000,000 | ||||||||
Zhangjiagang, China | Zhangjiagang Flavors Plant | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Property, plant and equipment, net | $ 34,000,000 | ||||||||
Chief Executive Officer | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Deferred Compensation Arrangement with Individual, Compensation Expense | $ 20,000,000 | $ 20,000,000 |
Redeemable Noncontrolling Int_3
Redeemable Noncontrolling Interests (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Balance at beginning | $ 30 | |||
Share of profit or loss attributable to redeemable noncontrolling interests | $ 2 | $ 2 | 3 | $ 6 |
Dividends paid | 3 | 2 | (2) | |
Exercises of redeemable noncontrolling interests | (5) | |||
Balance at end | 31 | 31 | ||
Redeemable Noncontrolling Interest | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Balance at beginning | 59 | 105 | ||
Impact of foreign exchange translation | (4) | |||
Share of profit or loss attributable to redeemable noncontrolling interests | 3 | |||
Redemption value adjustment for the current period | 1 | (3) | ||
Exercises of redeemable noncontrolling interests | 33 | |||
Balance at end | $ 60 | $ 68 | $ 60 | $ 68 |
Discontinued Operations and D_3
Discontinued Operations and Disposal Groups (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Cash and Cash Equivalents | $ 23 | $ 52 | $ 0 | $ 0 |
Operating lease right-of-use assets | 703 | 743 | ||
Disposal Group, Held-for-sale, Not Discontinued Operations | Savory Solutions and Flavor Specialty Ingredients | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Cash and Cash Equivalents | 52 | |||
Disposal Group, Including Discontinued Operation, Trade Receivables, Net | 85 | |||
Disposal Group, Including Discontinued Operation, Inventory | 157 | |||
Disposal Group, Including Discontinued Operation, Property, Plant and Equipment | 92 | |||
Disposal Group, Including Discontinued Operation, Goodwill | 348 | |||
Disposal Group, Including Discontinued Operation, Intangible Assets | 428 | |||
Operating lease right-of-use assets | 13 | |||
Other assets | 25 | |||
Total assets | 1,200 | |||
Accounts payable | 56 | |||
Disposal Group, Including Discontinued Operation, Deferred Tax Liabilities | 92 | |||
Other liabilities | 64 | |||
Total liabilities | $ 212 | |||
Disposal Group, Held-for-sale, Not Discontinued Operations | Cosmetic Ingredients | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Cash and Cash Equivalents | 23 | |||
Disposal Group, Including Discontinued Operation, Trade Receivables, Net | 15 | |||
Disposal Group, Including Discontinued Operation, Inventory | 19 | |||
Disposal Group, Including Discontinued Operation, Property, Plant and Equipment | 7 | |||
Disposal Group, Including Discontinued Operation, Goodwill | 267 | |||
Disposal Group, Including Discontinued Operation, Intangible Assets | 141 | |||
Operating lease right-of-use assets | 8 | |||
Other assets | 2 | |||
Total assets | 482 | |||
Accounts payable | 4 | |||
Disposal Group, Including Discontinued Operation, Deferred Tax Liabilities | 25 | |||
Other liabilities | 20 | |||
Total liabilities | $ 49 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Apr. 01, 2022 | |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 13,031 | $ 13,031 | $ 13,355 | |||
Common stock, par value, in dollars per share | $ 0.125 | $ 0.125 | $ 0.125 | |||
Transaction related costs | $ 1 | $ 1 | $ 6 | $ 3 | ||
Health Wright Products, Inc. (“Health Wright”) | ||||||
Business Acquisition [Line Items] | ||||||
Percentage of interests acquired | 100% | |||||
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | 5 | |||||
Nourish | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | 6,005 | 6,005 | $ 6,050 | |||
Health & Biosciences | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | 4,314 | 4,314 | 4,321 | |||
Pharma Solutions | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | 1,236 | 1,236 | 1,239 | |||
Scent | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | $ 1,476 | $ 1,476 | $ 1,745 |
Acquisitions - Schedule of asse
Acquisitions - Schedule of assets acquired and liabilities assumed (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Business Acquisition [Line Items] | ||
Goodwill | $ 13,031 | $ 13,355 |