INTERNATIONAL FLAVORS & FRAGRANCES INC

Previous wording

Our Pharma Solutions segment produces, among other things, a vast portfolio of cellulosics and seaweed-based pharmaceutical excipients, used to improve the functionality and delivery of active pharmaceutical ingredients, including controlled or modified drug release formulations, and enabling the development of more effective pharmaceutical finished dosage formulations. Our excipients are used in prescription and over-the-counter pharmaceuticals and dietary supplements. Our Pharma Solutions products also serve a variety of other specialty and industrial end-uses including coatings, inks, electronics, agriculture and consumer products. On March 19, 2024, we announced the sale process and entered into an agreement to sell our Pharma Solutions business, that is primarily made up of most businesses within the Company's existing Pharma Solutions reportable segment as well as certain adjacent businesses. See Note 3 for additional information.

Current wording

Our Pharma Solutions segment produces, among other things, a vast portfolio of cellulosics and seaweed-based pharmaceutical excipients, used to improve the functionality and delivery of active pharmaceutical ingredients, including controlled or modified drug release formulations, and enabling the development of more effective pharmaceutical finished dosage formulations. Our excipients are used in prescription and over-the-counter pharmaceuticals and dietary supplements. Our Pharma Solutions products also serve a variety of other specialty and industrial end-uses including coatings, inks, electronics, agriculture and consumer products. On March 19, 2024, we announced the sale process and entered into an agreement to sell the Pharma Solutions business disposal group, that is primarily made up of most businesses within the Company's existing Pharma Solutions reportable segment as well as certain adjacent businesses. During October 2024, the Company entered into an agreement to sell its nitrocellulose business, which is within the Company's existing Pharma Solutions reportable operating segment. See Note 3 for additional information.

Previous wording

Changes in our financial results include the impact of changes in foreign currency exchange rates. We provide currency neutral calculations in this report to remove the impact of these items. Our method in calculating currency neutral numbers is conducted by translating current year invoiced sale amounts at the exchange rates used for the corresponding prior year period. We use currency neutral results in our analysis of subsidiary and/or segment performance. We also use currency neutral numbers when analyzing our performance against our competitors.

Current wording

Changes in our financial results include the impact of changes in foreign currency exchange rates. We provide currency neutral calculations in this report to remove the impact of these items. We calculate currency neutral numbers by translating current year invoiced sale amounts at the exchange rates used for the corresponding prior year period. We use currency neutral results in our analysis of subsidiary and/or segment performance. We also use currency neutral numbers when analyzing our performance against our competitors.

Previous wording

For each of the three and six months ended June 30, 2024 and 2023, total sales to Israeli customers were less than 1% of total sales.

Current wording

For each of the three and nine months ended September 30, 2024 and 2023, total sales to Israeli customers were less than 1% of total sales.

Previous wording

For the three and six months ended June 30, 2024, sales to Russian customers were approximately 2% and 1% of total sales, respectively. For the three and six months ended June 30, 2023, sales to Russian customers were approximately 1% and 2% of total sales, respectively.

Current wording

For each of the three and nine months ended September 30, 2024 and 2023, sales to Russian customers were approximately 1% of total sales.

Previous wording

For each of the three and six months ended June 30, 2024 and 2023, sales to Ukrainian customers were less than 1% of total sales.

Current wording

For each of the three and nine months ended September 30, 2024 and 2023, sales to Ukrainian customers were less than 1% of total sales.

Previous wording

Sales in the second quarter of 2024 decreased $40 million, or 1% on a reported basis, to $2.889 billion compared to $2.929 billion in the 2023 period. On a currency neutral basis, sales in the second quarter of 2024 increased 2% compared to the 2023 period. Exchange rate variations had an unfavorable impact on net sales for the second quarter of 2024 of 3%. The effect of exchange rates can vary by business and region, depending upon the mix of sales priced in U.S. dollars as compared to other currencies. The increase in currency neutral sales was primarily driven by volume increases across various businesses, offset by divestiture impacts of approximately $134 million from the sale of a portion of the Savory Solutions business, Flavor Specialty Ingredients ("FSI") business, and Cosmetic Ingredients business (“change in business portfolio mix due to divestitures”).

Current wording

Sales in the third quarter of 2024 increased $105 million, or 4% on a reported basis, to $2.925 billion compared to $2.820 billion in the 2023 period. On a currency neutral basis, sales in the third quarter of 2024 increased 7% compared to the 2023 period. Exchange rate variations had an unfavorable impact on net sales for the third quarter of 2024 of 3%. The effect of exchange rates can vary by business and region, depending upon the mix of sales priced in U.S. dollars as compared to other currencies. The increase in currency neutral sales was primarily driven by volume increases across various businesses, offset by divestiture impacts of approximately $23 million from the sale of the Cosmetic Ingredients business.

Previous wording

Gross profit in the second quarter of 2024 increased $135 million, or 14%, to $1.068 billion (37.0% of sales) compared to $933 million (31.9% of sales) in the 2023 period. The increase in gross profit was primarily driven by volume increases, productivity gains and favorable net pricing, offset in part by the change in business portfolio mix due to divestitures.

Current wording

Gross profit in the third quarter of 2024 increased $128 million, or 14%, to $1.052 billion (36.0% of sales) compared to $924 million (32.8% of sales) in the 2023 period. The increase in gross profit was primarily driven by volume increases and favorable net pricing, offset in part by unfavorable exchange rate variations and divestiture impacts from the sale of the Cosmetic Ingredients business.

Previous wording

SECOND QUARTER 2024 IN COMPARISON TO SECOND QUARTER 2023

Current wording

THIRD QUARTER 2024 IN COMPARISON TO THIRD QUARTER 2023

Previous wording

Nourish sales in 2024 decreased $86 million, or 5% on a reported basis, to $1.478 billion compared to $1.564 billion in the prior year period. On a currency neutral basis, Nourish sales decreased 2% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. In addition, performance in the Nourish operating segment was driven by the divestiture of the portion of the Savory Solutions business with an impact of approximately $89 million and price decreases across various business units, offset in part by volume increases across various business units.

Current wording

Nourish sales in 2024 increased $37 million, or 3% on a reported basis, to $1.486 billion compared to $1.449 billion in the prior year period. On a currency neutral basis, Nourish sales increased 6% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. Performance in the Nourish operating segment was driven by volume increases across various business units.

Previous wording

Health & Biosciences sales in 2024 increased $36 million, or 7% on a reported basis, to $558 million compared to $522 million in the prior year period. On a currency neutral basis, Health & Biosciences sales increased 9% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. In addition, performance in the Health & Biosciences operating segment was driven by volume increases across various business units.

Current wording

Health & Biosciences sales in 2024 increased $52 million, or 10% on a reported basis, to $570 million compared to $518 million in the prior year period. On a currency neutral basis, Health & Biosciences sales increased 12% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. Performance in the Health & Biosciences operating segment was driven by volume increases across all business units.

Previous wording

Scent sales in 2024 increased $11 million, or 2% on a reported basis, to $603 million compared to $592 million in the prior year period. On a currency neutral basis, Scent sales increased 7% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. In addition, performance in the Scent operating segment was driven by volume and price increases in the fragrance compounds and fragrance ingredients business units, offset in part by the divestitures of the FSI business and Cosmetic Ingredients business with an impact of approximately $45 million.

Current wording

Scent sales in 2024 remained flat at $613 million compared to $615 million in the prior year period. On a currency neutral basis, Scent sales increased 5% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. Performance in the Scent operating segment was driven by price increases in the fragrance compounds business unit and volume increases in the fragrance compounds and fragrance ingredients business units, offset in part by the divestitures of the Cosmetic Ingredients business with an impact of approximately $23 million.

Previous wording

Pharma Solutions sales in 2024 remained flat at $250 million compared to $251 million in the prior year period. On a currency neutral basis, Pharma Solutions sales were flat in 2024 compared to the prior year. Performance in the Pharma Solutions operating segment was driven by volume increases, offset by price decreases in selective end markets.

Current wording

Pharma Solutions sales in 2024 increased $18 million, or 8% on a reported basis, to $256 million compared to $238 million in the prior year period. On a currency neutral basis, Pharma Solutions sales increased by 8% as exchange rate variations were flat in 2024 compared to the prior year. Performance in the Pharma Solutions operating segment was driven by volume increases across Pharma and Industrial end markets.

Previous wording

Cost of goods sold decreased $175 million to $1.821 billion (63.0% of sales) in the second quarter of 2024 compared to $1.996 billion (68.1% of sales) in the second quarter of 2023. The decrease in cost of goods sold was primarily driven by lower raw material costs and manufacturing expenses, lower unfavorable manufacturing absorption compared to the prior year period, positive net pricing and productivity compared to the prior year period, and the change in business portfolio mix due to divestitures, with an impact of approximately $86 million, offset in part by volume increases in sales.

Current wording

Cost of goods sold decreased $23 million to $1.873 billion (64.0% of sales) in the third quarter of 2024 compared to $1.896 billion (67.2% of sales) in the third quarter of 2023. The decrease in cost of goods sold was primarily driven by lower raw material costs and manufacturing expenses, lower unfavorable manufacturing absorption compared to the prior year period, offset in part by volume increases in sales.

Previous wording

R&D expenses increased $12 million to $173 million (6.0% of sales) in the second quarter of 2024 compared to $161 million (5.5% of sales) in the second quarter of 2023. The increase in R&D expenses was primarily driven by an increase in incentive compensation expense, offset in part by the change in business portfolio mix due to divestitures.

Current wording

R&D expenses increased $5 million to $162 million (5.5% of sales) in the third quarter of 2024 compared to $157 million (5.6% of sales) in the third quarter of 2023. The increase in R&D expenses was primarily driven by an increase in incentive compensation expense.

Previous wording

S&A expenses increased $48 million to $493 million (17.1% of sales) in the second quarter of 2024 compared to $445 million (15.2% of sales) in the second quarter of 2023. The increase in S&A expenses was primarily driven by increased incentive compensation expense, higher professional and legal fees incurred and provisions for the ongoing investigations of the fragrance businesses, offset in part by the change in business portfolio mix due to divestitures.

Current wording

S&A expenses increased $51 million to $495 million (16.9% of sales) in the third quarter of 2024 compared to $444 million (15.7% of sales) in the third quarter of 2023. The increase in S&A expenses was primarily driven by increased incentive compensation expense and divestiture related costs incurred in preparation for the sale of the Pharma Solutions disposal group.

Previous wording

Amortization expenses decreased to $153 million in the second quarter of 2024 compared to $172 million in the second quarter of 2023. The decrease in amortization expense was primarily driven by the reduction in intangible assets as a result of the change in business portfolio mix due to divestitures and intangible assets of the Pharma Solutions disposal group being classified as “held for sale,” and therefore no longer recognizing amortization expense on those intangible assets. See Note 3 for additional information.

Current wording

Amortization expenses decreased to $146 million in the third quarter of 2024 compared to $170 million in the third quarter of 2023. The decrease in amortization expense was primarily driven by the reduction in intangible assets as a result of the change in business portfolio mix due to divestitures and intangible assets of the Pharma Solutions disposal group being classified as “held for sale”, and therefore no longer recognizing amortization expense on those intangible assets. See Note 3 for additional information.

Previous wording

Restructuring and other charges was $2 million in the second quarter of 2024 compared to $7 million in the second quarter of 2023. The decrease was driven by lower severance costs incurred compared to the prior year period. See Note 4 for additional information.

Current wording

Restructuring and other charges was $1 million in the third quarter of 2024 compared to $2 million in the third quarter of 2023. The decrease was driven by lower severance costs incurred compared to the prior year period. See Note 4 for additional information.

Previous wording

Interest expense decreased to $79 million in the second quarter of 2024 compared to $101 million in the second quarter of 2023. The decrease in interest expense was due to lower debt outstanding. See Note 13 for additional information.

Current wording

Interest expense decreased to $74 million in the third quarter of 2024 compared to $90 million in the third quarter of 2023. The decrease in interest expense was due to lower debt outstanding. See Note 13 for additional information.

Previous wording

(Gains) losses on business disposals increased to $(368) million in the second quarter of 2024 compared to $5 million in the second quarter of 2023. The increase was primarily driven by the gain recognized on the Cosmetic Ingredients business divestiture. See Note 3 for additional information.

Current wording

Losses on business disposals increased to $20 million in the third quarter of 2024 compared to $10 million in the third quarter of 2023. The increase was primarily driven by the loss recognized on the F&E UK divestiture. See Note 3 for additional information.

Previous wording

Other expense (income), net, was $15 million in the second quarter of 2024 compared to $(11) million in the second quarter of 2023. The decrease of $26 million was primarily due to higher foreign exchange losses. See Note 8 for additional information.

Current wording

Other expense (income), net, was $28 million in the third quarter of 2024 compared to $(9) million in the third quarter of 2023. The increase of $37 million was primarily due to higher foreign exchange losses in 2024. See Note 8 for additional information.

Previous wording

The effective tax rate for the three months ended June 30, 2024 was 6.0% compared to 46.0% for the three months ended June 30, 2023. The quarter-over-quarter decrease was primarily driven by an increase in pre-tax income, changes in the mix of earnings and in tax impacts on business divestitures.

Current wording

The effective tax rate for the three months ended September 30, 2024 was 36.8% compared to 54.2% for the three months ended September 30, 2023. The quarter-over-quarter decrease was primarily driven by an increase in pre-tax income, changes in the mix of earnings and in tax charges on business divestitures.

Previous wording

FIRST SIX MONTHS 2024 IN COMPARISON TO FIRST SIX MONTHS 2023

Current wording

FIRST NINE MONTHS 2024 IN COMPARISON TO FIRST NINE MONTHS 2023

Previous wording

Sales for the first six months of 2024 decreased $168 million, or 3% on a reported basis, to $5.788 billion compared to $5.956 billion in the 2023 period. On a currency neutral basis, sales for the first six months of 2024 was flat compared to the 2023 period. Exchange rate variations had an unfavorable impact on net sales in the first six months of 2024 of 3%. The effect of exchange rates can vary by business and region, depending upon the mix of sales priced in U.S. dollars as compared to other currencies. In addition, the decrease in sales was primarily driven by the change in business portfolio mix due to divestitures which was approximately $288 million, offset in part by volume increases across various business lines.

Current wording

Sales for the first nine months of 2024 decreased $63 million, or 1% on a reported basis, to $8.713 billion compared to $8.776 billion in the 2023 period. On a currency neutral basis, sales for the first nine months of 2024 increased 3% compared to the 2023 period, as exchange rate variations had an unfavorable impact on net sales in the first nine months of 2024. The effect of exchange rates can vary by business and region, depending upon the mix of sales priced in U.S. dollars as compared to other currencies. In addition, the decrease in sales was primarily driven by the divestiture impacts of the portion of the Savory Solutions business, Flavors Specialty Ingredients (“FSI”) business, and Cosmetic Ingredients business (“change in business portfolio mix due to divestitures”), which was approximately $314 million, offset in part by volume increases across various business lines.

Previous wording

Nourish sales in 2024 decreased $243 million, or 8% on a reported basis, to $2.974 billion compared to $3.217 billion in the prior year period. On a currency neutral basis, Nourish sales decreased 4% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. In addition, performance in the Nourish operating segment was driven by the divestiture of the portion of the Savory Solutions business with an impact of approximately $223 million and price decreases, offset in part by volume increases across all business units.

Current wording

Nourish sales in 2024 decreased $206 million, or 4% on a reported basis, to $4.460 billion compared to $4.666 billion in the prior year period. On a currency neutral basis, Nourish sales decreased 1% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. In addition, performance in the Nourish operating segment was driven by the divestiture of the portion of the Savory Solutions business with an impact of approximately $222 million and price decreases, offset in part by volume increases across all business units.

Previous wording

Health & Biosciences sales in 2024 increased $54 million, or 5% on a reported basis, to $1.089 billion compared to $1.035 billion in the prior year period. On a currency neutral basis, Health & Biosciences sales increased 7% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. In addition, performance in the Health & Biosciences operating segment was driven by price and volume increases across all business units.

Current wording

Health & Biosciences sales in 2024 increased $106 million, or 7% on a reported basis, to $1.659 billion compared to $1.553 billion in the prior year period. On a currency neutral basis, Health & Biosciences sales increased 9% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. Performance in the Health & Biosciences operating segment was driven by volume increases across all business units and price increases across Cultures & Food Enzymes and Grain Processing business units.

Previous wording

Scent sales in 2024 increased $48 million, or 4% on a reported basis, to $1.248 billion compared to $1.200 billion in the prior year period. On a currency neutral basis, Scent sales increased 10% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. In addition, performance in the Scent operating segment was driven by price increases in the Fragrance Compounds business unit and volume increases across all business lines, offset in part by the divestiture of the FSI business and Cosmetic Ingredients business, with an impact of approximately $65 million.

Current wording

Scent sales in 2024 increased $46 million, or 3% on a reported basis, to $1.861 billion compared to $1.815 billion in the prior year period. On a currency neutral basis, Scent sales increased 8% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. Performance in the Scent operating segment was driven by price increases in the Fragrance Compounds business unit and volume increases across all business units, offset in part by the divestiture of the FSI business and Cosmetic Ingredients business, with an impact of approximately $92 million.

Previous wording

Pharma Solutions sales in 2024 decreased $27 million, or 5% on a reported basis, to $477 million compared to $504 million in the prior year period. On a currency neutral basis, Pharma Solutions sales also decreased 6% in 2024 compared to the prior year period as the impact of exchange rate variations was favorable. Performance in the Pharma Solutions operating segment was driven by price and volume decreases in the Pharma segment with growth in industrial markets.

Current wording

Pharma Solutions sales in 2024 decreased $9 million, or 1% on a reported basis, to $733 million compared to $742 million in the prior year period. On a currency neutral basis, Pharma Solutions sales also decreased 1% in 2024 compared to the prior year period as exchange rate variations had no impact. Performance in the Pharma Solutions operating segment was driven by price decreases offset in part by volume growth in industrial markets.

Previous wording

Cost of goods sold decreased $363 million to $3.696 billion (63.9% of sales) in the first six months of 2024 compared to $4.059 billion (68.1% of sales) in the 2023 period. The decrease in cost of goods sold was primarily driven by the change in business portfolio mix due to divestitures which was approximately $195 million, lower raw material costs and manufacturing expenses, lower unfavorable manufacturing absorption compared to the prior year period, positive net pricing and productivity compared to the prior year period, offset in part by volume increases.

Current wording

Cost of goods sold decreased $386 million to $5.569 billion (63.9% of sales) in the first nine months of 2024 compared to $5.955 billion (67.9% of sales) in the 2023 period. The decrease in cost of goods sold was primarily driven by the change in business portfolio mix due to divestitures which was approximately $206 million, lower raw material costs and manufacturing expenses, lower unfavorable manufacturing absorption compared to the prior year period, positive net pricing and productivity compared to the prior year period, offset in part by volume increases.

Previous wording

R&D expenses increased $17 million to $339 million (5.9% of sales) in the first six months of 2024 compared to $322 million (5.4% of sales) in the 2023 period. The increase in R&D expenses was primarily driven by an increase in incentive compensation expense, offset in part by the net impact of the change in business portfolio mix.

Current wording

R&D expenses increased $22 million to $501 million (5.8% of sales) in the first nine months of 2024 compared to $479 million (5.5% of sales) in the 2023 period. The increase in R&D expenses was primarily driven by an increase in incentive compensation expense, offset in part by the net impact of the change in business portfolio mix due to divestitures.

Previous wording

S&A expenses increased $84 million to $0.983 billion (17.0% of sales) in the first six months of 2024 compared to $899 million (15.1% of sales) in the 2023 period. The increase in S&A expenses was primarily driven by an increase in incentive compensation expense, higher operating expenses for S&A related activities, professional fees, legal fees and provisions incurred for the ongoing investigations of the fragrance businesses, offset in part by the change in business portfolio mix due to divestitures.

Current wording

S&A expenses increased $135 million to $1.478 billion (17.0% of sales) in the first nine months of 2024 compared to $1,343 million (15.3% of sales) in the 2023 period. The increase in S&A expenses was primarily driven by an increase in incentive compensation expense, professional fees, legal fees and provisions incurred for the ongoing investigations of the fragrance businesses, and divestiture related costs incurred in preparation for the sale of the Pharma Solutions disposal group, offset in part by the change in business portfolio mix due to divestitures.

Previous wording

Amortization expenses decreased to $321 million in the first six months of 2024 compared to $343 million in the 2023 period. The decrease in amortization expense was primarily driven by the reduction in intangible assets as a result of the change in business portfolio mix due to divestitures and intangible assets of the Pharma Solutions disposal group being classified as “held for sale,” and therefore no longer recognizing amortization expense on those intangible assets. See Note 3 for additional information.

Current wording

Amortization expenses decreased to $467 million in the first nine months of 2024 compared to $513 million in the 2023 period. The decrease in amortization expense was primarily driven by the reduction in intangible assets as a result of the change in business portfolio mix due to divestitures and intangible assets of the Pharma Solutions disposal group being classified as “held for sale”, and therefore no longer recognizing amortization expense on those intangible assets. See Note 3 for additional information.

Previous wording

The impairment of goodwill was $64 million in the second quarter of 2024. See Note 3 for additional information.

Current wording

The impairment of goodwill was $64 million in the first nine months of 2024. See Note 3 for additional information.

Previous wording

Restructuring and other charges decreased to $5 million in the first six months of 2024 compared to $59 million in the 2023 period. The decrease was driven by higher severance costs incurred as part of the 2023 Restructuring Program, net of reversals of prior severance cost accruals, in the first six months of 2023. See Note 4 for additional information.

Current wording

Restructuring and other charges decreased to $6 million in the first nine months of 2024 compared to $61 million in the 2023 period. The decrease was driven by higher severance costs incurred as part of the 2023 Restructuring Program, net of reversals of prior severance cost accruals, in the first nine months of 2023. See Note 4 for additional information.

Previous wording

Interest expense decreased to $162 million in the first six months of 2024 compared to $201 million in the 2023 period. The decrease in interest expense was due to lower debt outstanding (see Note 13 for additional information).

Current wording

Interest expense decreased to $236 million in the first nine months of 2024 compared to $291 million in the 2023 period. The decrease in interest expense was due to lower debt outstanding (see Note 13 for additional information).

Previous wording

(Gains) losses on business disposals increased to $(368) million in the first six months of 2024 compared to $19 million in the 2023 period. The increase was primarily driven by the gain recognized on the Cosmetic Ingredients business divestiture in 2024 and the loss recognized on the sale of the portion of the Savory Solutions business in 2023. See Note 3 for additional information.

Current wording

(Gains) losses on business disposals increased to $(348) million in the first nine months of 2024 compared to $29 million in the 2023 period. The net gain on business disposals in 2024 primarily relates to the gain recognized on the sale of the Cosmetic Ingredients business, offset in part by the loss recognized on the sale of the F&E UK business. The loss in the 2023 period relates to the sale of the FSI business, the sale of a portion of the Savory Solutions business, and liquidation of a business in Russia for the sale of the portion of the Savory Solutions business. See Note 3 for additional information.

Previous wording

Other expense (income), net, was $16 million in the first six months of 2024 compared to $(8) million in the 2023 period. The change of $24 million was primarily due to increased foreign exchange losses, offset in part by decreased pension-related benefit. See Note 8 for additional information.

Current wording

Other expense (income), net, was $44 million in the first nine months of 2024 compared to $(17) million in the 2023 period. The change of $61 million was primarily due to increased foreign exchange losses, in addition to the gain recognized on the China facility relocation in the 2023 period. See Note 8 for additional information.

Previous wording

The effective tax rate for the six months ended June 30, 2024 was 21.8% compared to 70.3% for the six months ended June 30, 2023. The year-over-year decrease was primarily driven by an increase in pre-tax income, changes in the mix of earnings and in tax impacts on business divestitures.

Current wording

The effective tax rate for the nine months ended September 30, 2024 was 25.4% compared to 62.6% for the nine months ended September 30, 2023. The year-over-year decrease was primarily driven by an increase in pre-tax income, changes in the mix of earnings and in tax charges on business divestitures.

Previous wording

Nourish Segment Adjusted Operating EBITDA increased $59 million, or 15% on a reported basis, to $448 million in the first six months of 2024 (15.1% of segment sales) from $389 million (12.1% of segment sales) in the comparable 2023 period. On a currency neutral basis, Nourish Segment Adjusted Operating EBITDA increased 31% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. In addition, the performance was primarily driven by favorable net pricing, productivity gains and volume increases, offset in part by the impact of the divestiture of the portion of the Savory Solutions business.

Current wording

Nourish Segment Adjusted Operating EBITDA increased $87 million, or 15% on a reported basis, to $654 million in the first nine months of 2024 (14.7% of segment sales) from $567 million (12.2% of segment sales) in the comparable 2023 period. On a currency neutral basis, Nourish Segment Adjusted Operating EBITDA increased 29% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. The performance was primarily driven by favorable net pricing, productivity gains and volume increases, offset in part by the impact of the divestiture of the portion of the Savory Solutions business.

Previous wording

Scent Segment Adjusted Operating EBITDA increased $72 million, or 32% on a reported basis, to $294 million in the first six months of 2024 (23.6% of segment sales) from $222 million (18.5% of segment sales) in the comparable 2023 period. On a currency neutral basis, Scent Segment Adjusted Operating EBITDA increased 58% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. In addition, the performance was primarily driven by favorable net pricing, productivity gains and volume increases, offset in part by the impact of the divestiture of the FSI business and Cosmetic Ingredients business.

Current wording

Scent Segment Adjusted Operating EBITDA increased $68 million, or 19% on a reported basis, to $421 million in the first nine months of 2024 (22.6% of segment sales) from $353 million (19.4% of segment sales) in the comparable 2023 period. On a currency neutral basis, Scent Segment Adjusted Operating EBITDA increased 41% in 2024 compared to the prior year period as exchange rate variations had an unfavorable impact. The performance was primarily driven by favorable net pricing, productivity gains and volume increases, offset in part by the impact of the divestiture of the FSI business and Cosmetic Ingredients business.

Previous wording

Pharma Solutions Segment Adjusted Operating EBITDA decreased $26 million, or 21% on a reported basis, to $100 million in the first six months of 2024 (21.0% of segment sales) from $126 million (25.0% of segment sales) in the comparable 2023 period. On a currency neutral basis, Pharma Solutions Segment Adjusted Operating EBITDA decreased 20% in 2024 compared to the prior year period as exchange rate variations remained flat. The decreased performance was primarily driven by favorable one-off items in the 2023 period which did not recur in the 2024 period, and volume decreases.

Current wording

Pharma Solutions Segment Adjusted Operating EBITDA decreased $11 million, or 6% on a reported basis, to $162 million in the first nine months of 2024 (22.1% of segment sales) from $173 million (23.3% of segment sales) in the comparable 2023 period. On a currency neutral basis, Pharma Solutions Segment Adjusted Operating EBITDA decreased 6% in 2024 compared to the prior year period as exchange rate variations remained flat. The decreased performance was primarily driven by higher costs including favorable one-off items in the 2023 period which did not recur in the 2024 period.