Sensient Technologies Corp (NYSE:SXT) Q4 2019 Earnings Conference Call - Final Transcript
Feb 14, 2020 • 09:30 am ET
Good morning and welcome to the Sensient Technologies Corporation 2019 Fourth Quarter and Year End Earnings Conference Call. [Operator Instructions]
I would now like to turn the conference over to Mr. Steve Rolfs. Please go ahead, sir.
Stephen J. Rolfs
Good morning. I'm Steve Rolfs, Senior Vice President and Chief Finance Officer of Sensient Technologies Corporation. I would like to welcome all of you to Sensient's conference call to discuss 2019 fourth quarter financial results. I'm joined this morning by Paul Manning, Sensient's Chairman, President and Chief Executive Officer.
This morning, we released our 2019 fourth quarter financial results. A copy of the release is now available on our website at sensient.com. During our call today, we will reference certain non-GAAP financial measures, which we believe provide investors with additional information to evaluate the Company's performance and improve the comparability of results between reporting periods. These non-GAAP financial measures remove the impact of currency movements, depreciation and amortization, non-cash stock-based compensation, divestiture and other related costs, the impact of the 2017 US tax legislation and other items noted in the Company's filings. Non-GAAP financial results should not be considered in isolation from or as a substitute for financial information calculated in accordance with GAAP.
A reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures is available on the Investor Information section of our website at sensient.com and in our press release. We encourage investors to review these reconciliations in connection with the comments we make this morning.
I would also like to remind everyone that comments made this morning, including responses to your questions may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Our statements may be affected by certain factors, including risks and uncertainties, which are discussed in detail in the Company's filings with the Securities and Exchange Commission. We urge you to read Sensient's filings, including our forthcoming 10-K for a description of these factors. Please bear these factors in mind when you analyze our comments today.
Now, we'll hear from Paul Manning.
Thanks, Steve. Good morning. This morning, we released our fourth quarter results. During 2019 we had strong results in natural colors, finished flavors and extracts in our pharmaceutical business. These results were offset by several market dynamics and by the impact of a number of underperforming businesses that we are in the process of divesting.
In 2019, Sensient's business was impacted by a number of adverse market factors. We saw uncertainty in higher costs tied to raw material availability tariffs and trade disputes. We also saw a changing consumer trends for cosmetic products particularly in makeup that had an adverse effect on our sales for the second half of 2018 and for all of 2019. Food-related markets were impacted by changing consumer tastes that have challenged many of our larger customers as well as certain product lines in which we participate.
We have implemented a number of actions in response to these challenges. I expect a much better year