Sensient Technologies Corporation SXT
today announced that its Board of Directors has declared a regular quarterly
cash dividend on its common stock of $0.25 per share, an increase of 9% per
share. The cash dividend will be paid on June 2, 2014, to shareholders of
record on May 9, 2014. With this increase, the Company's annual dividend
payments to shareholders will have increased in each of the last nine
consecutive years. Sensient also announced plans to repurchase up to two
million shares of its common stock over the next twelve months, representing
approximately 4% of outstanding shares. Sensient's purchases of common stock
will be made in the open market, on an opportunistic basis depending on market
and other conditions. Sensient's plan to repurchase its common stock is based
on confidence in the Company's outlook and in the success of its ongoing
strategy and will be made under an existing authorization from its Board of
Directors.
The Company also announced today that its Board of Directors has approved a
plan to initiate a further restructuring program which follows the recently
completed 2013 restructuring. This extensive plan will eliminate
underperforming operations, consolidate manufacturing facilities and improve
efficiencies within the Company. The plan, which will impact several
facilities, will generate cost savings preliminarily estimated to be between
$20 million and $25 million per year upon completion, which is expected to be
in 2015. In addition to providing significant cost savings, the plan will
simplify the Company's business and allow for more efficient capital
allocation toward strategic activities. These actions are expected to
significantly improve profitability and margins within the Flavors &
Fragrances Group and improve returns on capital across the Company. Sensient
expects to incur pre-tax charges of approximately $90 million, of which cash
charges will be less than $25 million, in connection with the restructuring
program. Sensient will make additional details regarding the plan available
during its conference call to announce financial results for the first quarter
of 2014.
Sensient recently conducted a series of calls with a substantial number of its
institutional shareholders in order to understand and respond to their views
on capital allocation and improving profitability. Shareholders expressed
strong support for the Company's management and its strategy to grow the
business, improve results in the Flavors & Fragrances Group and improve the
Company's return on invested capital. The Company's plans to return capital to
shareholders and further restructure its business will maintain Sensient's
strong credit profile which is consistent with the wishes expressed by
shareholders.
“The actions announced by Sensient today represent an aggressive plan to
improve the Company's cost structure. At the same time, we have found a
responsible means to return additional capital to shareholders while
preserving the financial flexibility necessary to invest in pursuing the
substantial growth opportunities we see in our business. It is clear that
shareholders want us to continue to execute our existing strategy and to take
advantage of opportunities to grow and improve the business and drive out
costs,” said Paul Manning, President and CEO of Sensient Technologies
Corporation. “I am very pleased by the level of support that shareholders have
expressed for Sensient's management and its ongoing strategy.”
As COO of Sensient and since becoming CEO, Paul Manning has engaged with
investors on a regular basis and the Company intends to continue this practice
in order to be responsive to shareholder concerns. The Company's willingness
to respond to shareholder feedback is demonstrated by the actions announced
today as well as a strong track-record of shareholder friendly actions. Recent
initiatives, some of which were based largely on feedback from shareholders,
have included:
* A significant restructuring program completed in 2013, resulting in
on-going cost savings of $12 million per year
* Changes implemented in October 2013 to its compensation practices, which
enhanced linkages of executive pay and Company performance
* Adoption of a majority voting standard to enhance the Company's director
resignation policy for uncontested elections
* Declassification of the Company's Board of Directors
* Elimination of Sensient's poison pill
* Addition of a new independent Director to the Board in 2013
* Ongoing efforts of the Board's Nominating and Corporate Governance
Committee to evaluate additional candidates for positions on Sensient's
Board of Directors.
“Sensient understands the need to be responsive to shareholder input and we
remain fully committed to constructive shareholder engagement,” said Paul
Manning, President and CEO of Sensient Technologies Corporation.
Market News and Data brought to you by Benzinga APIs© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Loading...
Benzinga simplifies the market for smarter investing
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
Join Now: Free!
Already a member?Sign in