Analyst Note| Seth Goldstein, CFA |
International Flavors & Fragrances reported solid first-quarter results as adjusted EBITDA was up 4% versus the prior year quarter due largely to rebounding volumes and lower costs. We increased our near-term outlook for the scent segment to account for a faster-than-expected rebound in fine fragrances. We have also slightly lowered our 2021 profit margin forecast in the nourish segment to incorporate the effects of higher raw materials and transportation costs. We think IFF will be able to completely pass along the higher expenses over time. As such, we expect higher prices will restore margins in 2022.