INGR - Ingredion Incorporated Reports Strong 2023 Fourth Quarter and Full-Year Results | Benzinga

• Fourth quarter 2023 reported and adjusted operating income^* grew 29% and 21%, respectively
• Full-year 2023 reported and adjusted EPS^* were $9.60 and $9.42, an increase of 31% and 26%, respectively, which includes S. Korea business results that contributed $0.47 and $0.45, respectively
• Full-year 2023 cash from operations was $1,057 million, up from $152 million in 2022
• The Company expects its full-year 2024 outlook for reported EPS to be in the range of $10.20 to $11.15 and adjusted EPS to be in the range of $9.15 to $9.85, reflecting the impact of the S. Korea business divestiture

WESTCHESTER, Ill., Feb. 06, 2024 (GLOBE NEWSWIRE) -- Ingredion Incorporated (NYSE:INGR), a leading global provider of ingredient solutions to the food and beverage manufacturing industry, today reported results for the fourth quarter of 2023 and full-year 2023. The results, reported in accordance with U.S. generally accepted accounting principles ("GAAP") for the fourth quarter of 2023 and 2022 and full-year 2023 and 2022, include items that are excluded from the non-GAAP financial measures that the Company presents.

"Our business performed exceptionally well and remained resilient throughout 2023, delivering more than 20% operating income growth for both the fourth quarter and full year. Our targeted pricing actions and proactive cost savings initiatives helped overcome inflation and raw material volatility, leading to a sixth consecutive, quarter-over-quarter expansion of gross margin. Additionally, cash from operations exceeded $1 billion dollars, and we returned $295 million dollars to shareholders in the year," said Jim Zallie, Ingredion's president and CEO.

"We continue to make significant progress strengthening our diversified and balanced portfolio of ingredients and solutions. Specialty ingredients grew mid-single digits, despite volume headwinds as customers destocked and managed inventories lower. In the second half of 2023, we saw a steady recovery of volumes as customer demand strengthened. Throughout the year, our teams demonstrated agility and operational excellence as they continued to balance production schedules and optimize inventory levels at year end.

"As we look ahead to 2024, we are confident that the reorganization of our business operations will better align our resources and capabilities with customers' needs to better target growth opportunities. We are well positioned to deliver profitable growth and margin expansion, as well as generate strong cash flow. We believe our Driving Growth Roadmap continues to guide long-term value creation for our shareholders as we deepen our customer relationships, and drive innovation and operational excellence to win in the marketplace," Zallie concluded.

Diluted Earnings Per Share (EPS)

Estimated factors affecting changes in Reported and Adjusted EPS

**Totals may not foot due to rounding;

Financial Highlights

• At December 31, 2023, total debt and cash, including short-term investments, were $2.2 billion and $409 million, respectively, versus $2.5 billion and $239 million, respectively, at December 31, 2022.
• Cash from operations was $1,057 million, up from $152 million in 2022, reflecting changes in working capital and current period net income.
• Reported net financing costs for the fourth quarter were $26 million versus $34 million for the year-ago period.
• Reported and adjusted effective tax rates for the fourth quarter were 24.4% and 24.9%, respectively, compared to 7.3% and 20.1%, respectively, for the year-ago period. The increase in the reported tax rate resulted primarily from non-taxable incentives related to our South America operations recorded in the fourth quarter of 2022.
• Capital expenditures were $314 million, net of disposals, up $21 million from the year-ago period.
  

Business Review

Total Ingredion
Net Sales

Reported Operating Income

Adjusted Operating Income

Net Sales

• Fourth quarter and full-year net sales were down -3% and up 3% from the 2022 fourth quarter and prior year, respectively. The decrease in the quarter was led by volume declines, partially offset by price mix and foreign exchange impacts. For the full year, the increase was driven by price mix, partially offset by volume declines and foreign exchange impacts. Excluding foreign exchange impacts, fourth quarter and full-year net sales were down -4% and up 4%, respectively, from the 2022 fourth quarter and prior year, respectively.
  

Operating Income

• Fourth quarter reported and adjusted operating income were $202 million and $203 million, respectively, an increase of 29% and 21%, respectively, versus the 2022 fourth quarter. The increases were driven by lower raw material and input costs and favorable price mix, partially offset by lower volumes. Excluding foreign exchange impacts, reported and adjusted operating income were up 27% and 19%, respectively, from the same period last year.
  
• Full-year reported and adjusted operating income were $957 million and $969 million, respectively, an increase of 26% and 23%, respectively, versus the prior year. The increases in reported and adjusted operating income were attributable to favorable price mix, partially offset by higher raw material and input costs and lower volumes. Excluding foreign exchange impacts, full-year reported and adjusted operating income were up 28% and 25%, respectively, from the prior year.
  

North America
Net Sales

Segment Operating Income

• Fourth quarter operating income for North America was $143 million, an increase of $21 million from the year-ago period, and full-year operating income was $718 million, an increase of $153 million from the prior year. The increases for both periods were driven by favorable price mix, partially offset by lower volumes and higher fixed costs.)
  

South America
Net Sales

Segment Operating Income

• Fourth quarter operating income for South America was $46 million, an increase of $2 million from the year-ago period, and full-year operating income was $142 million, a decrease of $27 million from the prior year. The increase in fourth quarter operating income was driven by favorable foreign exchange impacts and strong performance by our Argentina joint venture, largely offset by lower price mix in Brazil and Andean markets. The effects of the devaluation of the Argentina peso in December 2023 are not reflected in our joint venture results, which are reported on a one-month lag. For the full year, the decrease in operating income was driven by lower volumes and higher energy costs, primarily from our transition to biomass boilers in Brazil. Excluding foreign exchange impacts, segment operating income was down -7% and -18%, for the fourth quarter and full year, respectively.
  

Asia-Pacific
Net Sales

Segment Operating Income

• Fourth quarter operating income for Asia-Pacific was $38 million, up $15 million from the year-ago period, and full-year operating income was $126 million, an increase of $33 million from the prior year. The increases in both periods were driven by lower input costs and a $7 million customer benefit in the quarter, partially offset by lower volumes. Excluding foreign exchange impacts, segment operating income was up 65% and 38% for the fourth quarter and full year, respectively.
  
  

Europe, Middle East, and Africa (EMEA)
Net Sales

Segment Operating Income

• Fourth quarter operating income for EMEA was $25 million, up $5 million from the year-ago period, and full-year operating income was $156 million, an increase of $46 million from the prior year. The increases were driven by favorable price mix, partially offset by lower volumes and foreign exchange impacts. Excluding foreign exchange impacts, segment operating income was up 30% and 53%, for the fourth quarter and full year, respectively.
  

Dividends and Share Repurchases
For full-year 2023, the Company paid $194 million in dividends to shareholders, and in the fourth quarter declared a quarterly dividend of $0.78 per share that was paid in the first quarter of 2024. During 2023, the Company repurchased 1.0 million outstanding shares of common stock at a net cost of $101 million. To support total shareholder return, the Company is dedicated to returning value to shareholders through cash dividends and share repurchases.

2024 Full-Year Outlook
The Company expects its full-year 2024 outlook for reported EPS to be in the range of $10.20 to $11.15, which includes the impact of the expected gain on the divestiture of its S. Korea business completed on February 1, 2024, and adjusted EPS to be in the range of $9.15 to $9.85, reflecting the impact of the S. Korea business divestiture.

Excluding the ...

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