Sensient Technologies (SXT) reported Q4 EPS of $0.69, $0.01 worse than the analyst estimate of $0.70. Revenue for the quarter came in at $348.7 million versus the consensus estimate of $352.42 million.
GUIDANCE:
Sensient expects 2023 full year GAAP diluted earnings per share to be flat to low-single digit growth compared to our 2022 reported GAAP diluted earnings per share of $3.34.
The Company expects 2023 revenue to grow at a mid-single digit rate on a local currency basis compared to the Company’s 2022 revenue. The Company expects 2023 diluted earnings per share to be flat to low-single digit growth on a local currency basis compared to the Company’s 2022 adjusted diluted earnings per share(2) of $3.29. The Company expects 2023 adjusted EBITDA(2) to grow at a mid-to-high single digit rate on a local currency basis compared to the Company’s 2022 adjusted EBITDA(2).
The Company expects its 2023 diluted earnings per share to be impacted by higher interest rates and a higher tax rate. The Company currently expects interest expense to increase by approximately $11 million ($0.20 per diluted share) in 2023 compared to the Company’s 2022 full year interest expense of $14.5 million. The Company also expects its full year 2023 tax rate to be approximately 25%.
Based on current exchange rates, the Company expects foreign exchange rates to be a headwind for the beginning of the year, and modestly favorable for the full year.
The Company’s guidance is based on current conditions and economic and market trends in the markets in which the Company operates and is subject to various risks and uncertainties as described below. We do not anticipate any divestiture related costs, operational improvement plan costs, or results of divested business in 2023 at this time.