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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
|X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000.
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO
Commission File Number 1-7626
UNIVERSAL FOODS CORPORATION
---------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DOING BUSINESS AS
SENSIENT TECHNOLOGIES CORPORATION
WISCONSIN 39-0561070
--------- ----------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
777 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN 53202-5304
-------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES AND ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (414) 271-6755
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
TITLE OF EACH CLASS NAME OF EXCHANGE
------------------- ON WHICH REGISTERED
Common Stock, $.10 par value -------------------
Associated Preferred Share Purchase Rights New York Stock Exchange, Inc.
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
None
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or such shorter period that the Registrant
was required to file such reports), and (2) has been subject to such filing
requirements for at least the past 90 days. Yes |X| No |_|
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. |_|
There were 48,264,808 shares of Common Stock outstanding as of February
28, 2001.
The aggregate market value of the voting Common Stock held by
non-affiliates of the Registrant as of February 28, 2001 was $1,035,781,378. For
purposes of this computation only, the Registrant's directors and executive
officers were considered to be affiliates of the Registrant. Such
characterization shall not be construed to be an admission or determination for
any other purpose that such persons are affiliates of the Registrant.
DOCUMENTS INCORPORATED BY REFERENCE
1. Portions of the Company's Annual Report to Shareholders for the fiscal
year ended December 31, 2000 (Parts I, II and IV of Form 10-K)
2. Portions of the Company's Notice of Annual Meeting and Proxy Statement
dated March 28, 2001 (Part III of Form 10-K)
PART I
Item 1. Business
General
Universal Foods Corporation, which is doing business as Sensient
Technologies Corporation (the "Company"), was incorporated in 1882 in Wisconsin.
Its principal executive offices are located at 777 East Wisconsin Avenue,
Milwaukee, Wisconsin 53202-5304, telephone (414) 271-6755.
On November 6, 2000, the Company began doing business under its new name,
Sensient Technologies Corporation (NYSE: SXT).
On September 7, 2000, the Company's Board of Directors approved a change
of the Company's fiscal year end from September 30 to December 31. The first
annual period reported under the new fiscal year is for the twelve months ended
December 31, 2000, as set forth herein.
In June 2000, the Company's Board of Directors approved a plan to sell the
operations of the Company's Red Star Yeast & Products Division ("Red Star") in
order to focus attention on faster growing, more profitable markets.
Accordingly, commencing with the quarter ended June 30, 2000, the Company
reported results from Red Star as a discontinued operation.
On February 23, 2001, the Company completed the sale of substantially all
the assets of Red Star for a total business value of $122 million. As a result
of this divestiture, the Company received cash proceeds of approximately $113
million, with $4 million received in the third quarter of 2000 and $109 million
in February 2001. The Company also retained assets valued at approximately $9
million pursuant to a U.S. government antitrust order. The cash proceeds will be
used to fund future acquisitions, repurchase stock and pay down debt.
Description of Business
Sensient Technologies Corporation is a manufacturer and marketer of
high-performance components that add functionality to foods, cosmetics,
pharmaceuticals and other products. The Company provides a full range of food
and beverage flavors and colors, cosmetic and pharmaceutical additives, ink-jet
inks, and ingredients for many of the world's best-known brands. The Company's
principal products include:
o Flavors, flavor enhancers and bionutrients,
o Fragrances and aroma chemicals,
o Dehydrated vegetables and other food ingredients,
o Natural and synthetic colors,
o Ink-jet inks and high purity organic dyes.
The Company's operations, except for the Asia Pacific Division, are
managed on a products and services basis. The Company's two reportable segments
are its Flavors & Fragrances Group and its Color Group.
Flavors & Fragrances Group
The Company is a leading manufacturer and supplier of flavors, ingredient
systems and aroma chemicals to the dairy, food processing, beverage, personal
care and household products industries worldwide. The Company has a broad,
distinctive and fully integrated product offering, ranging from savory flavor
components to fully formulated flavor systems for dairy, beverage, and processed
food applications.
The Flavors & Fragrances Group produces flavor and fragrance products that
impart a desired taste, texture, aroma or other functionality to a broad range
of consumer and other products. This Group includes the Company's dehydrated
vegetable products business, which produces ingredients for food processors.
The Flavors & Fragrances Group operates principally through the Company's
subsidiaries, Sensient Flavors Inc. (formerly, Universal Flavor Corporation) and
Rogers Foods, Inc. The Group's plants are located in California, Illinois,
Indiana, Michigan, Missouri, Wisconsin, Belgium, Canada, France, Germany,
Ireland, Italy, Mexico, the Netherlands, Spain and the United Kingdom.
During 1998 the Company integrated its bioproducts business (which was
formerly operated as a separate division known as Red Star BioProducts) into its
Flavors & Fragrances Group. The bioproducts business serves the food, animal
feed processing, and bionutrient industries with a broad line of natural
extracts and specialty flavors. The Company produces various specialty extracts
from yeast, vegetable proteins, meat, milk protein and other natural products
which are used primarily as savory flavor, texture modifiers and enhancers in
processed foods. The nutritional and functional properties of these extracts
also make them useful in enzyme and pharmaceutical production. The Company
believes it is the leading supplier of yeast extracts and the second leading
supplier of hydrolyzed vegetable proteins in the U.S. market.
Strategic acquisitions have expanded the Company's flavors and fragrances
product lines and processing capabilities. In January 1998, the Company acquired
Arancia Ingredients Especiales, S.A. de C.V., a manufacturer of savory flavors
and other food ingredients, improving access to the rapidly growing Latin
American savory flavor market. In April 1998, the Company acquired an English
savory and seasonings flavor manufacturer, DC Flavours Ltd., which further
expanded the Company's technology and worldwide market presence and also gives
the Company access to the snack food market, the fastest growing segment in
Europe's food market. In May 1998, the acquisition of substantially all of the
assets and business of the beverage business of German flavor manufacturer Sundi
GmbH, with its emphasis on all-natural flavor ingredients, provided the Company
with a point of entry into Germany, Europe's largest flavor market.
During the quarter ended June 30, 2000, the Company integrated its former
Dehydrated Products Division into its Flavors & Fragrances Group. The Company
believes it is the second largest producer of dehydrated onion and garlic
products in the United States. The Company is also one of the largest producers
and distributors of chili powder, paprika, chili pepper and dehydrated
vegetables such as parsley, celery and spinach. Domestically, the Company sells
dehydrated products to food manufacturers for use as ingredients and also for
repackaging under private labels for sale to the retail market and to the food
service industry.
The Company believes it is one of the leading dehydrators of specialty
vegetables in Europe, operating through its Sensient Specialty Vegetables
business. Advanced dehydration technologies utilized by Sensient Specialty
Vegetables permit faster and more effective rehydration of ingredients used in
many of today's popular convenience foods.
Color Group
Although statistics are not available, the Company believes that it is one
of the world's largest producers of synthetic and natural colors. The Company
also believes that it is the world's leading manufacturer of certified food
colors. The Company makes synthetic and natural colors for domestic and
international producers of beverages, bakery products, processed foods,
confections, pet foods, cosmetics and pharmaceuticals. It also makes ink-jet
inks and other high purity organic dyes.
The Company believes that its advanced process technology,
state-of-the-art laboratory facilities and equipment, and a complete range of
synthetic and natural color products constitute the basis for its market
leadership position. Strategic acquisitions continue to enhance product and
process technology synergies, as well as increasing its international presence.
The Color Group operates principally through the Company's subsidiary,
Warner-Jenkinson Company, Inc., which has its principal manufacturing facilities
in Missouri. Other Color Group facilities are located in New Jersey, Canada,
Mexico, France, Italy, the United Kingdom, Germany, and the Netherlands.
Effective January 1, 2000, the Company expanded its European color
business by acquiring Dr. Marcus GmbH, a leading manufacturer of natural colors
located near Hamburg, Germany. On January 27, 2000, the Company acquired 100% of
the ownership of Monarch Food Colors, a manufacturer of colors for the food,
pharmaceutical and cosmetic industries located in High Ridge, Missouri. The
Company had previously held a 24% ownership interest in Monarch Food Colors as a
result of its April 1999 acquisition of Pointing Holdings Limited.
In February 1999, the Company expanded its cosmetics business through the
purchase of Les Colorants Wackherr, a Paris-based producer of colors for major
cosmetics houses throughout Europe, Asia and North America. Also in February
1999, the Company further developed its natural colors offerings by acquiring
certain assets of Quimica Universal, a Peruvian producer of carminic acid and
annatto, natural colors used in food and other applications. The Company
acquired Pointing Holdings Limited, a
manufacturer of food colors located in the United Kingdom, in April 1999. The
Pointing international color business significantly strengthened the Company's
worldwide color capabilities. In August 1999, the Company acquired certain
assets of Nino Fornaciari fu Riccardo SNC, an Italian producer of natural colors
for the food and beverage industries.
In September 1998, the Company acquired Italian natural color producer
Reggiana Antociani S.R.L., a company which specializes in the production of
anthocyanin, which is extracted from grape skins and black carrots for use in
fruit juices, flavored teas, wine coolers and fruit fillings, strengthening the
Company's offerings in natural colors, the fastest growing segment of the
worldwide food colors market.
The Company became a supplier of ink-jet inks for the ink-jet printer
market with the acquisition of Tricon Colors in 1997. Also in 1997, the Company
strengthened its presence in Latin America by acquiring certain assets of the
food color business of Pyosa, S.A. de C.V., which is located in Monterrey,
Mexico.
Asia Pacific Division
The Asia Pacific Division focuses on marketing the Company's diverse
product line in the Pacific Rim under one name. Through its Sensient Asia
Pacific Division, the Company offers a full range of products from its Flavors &
Fragrances Group and Color Group, as well as products developed by regional
technical teams to appeal to local preferences. Sales, marketing and technical
functions are managed through the Asia Pacific Division's headquarters in
Singapore. Manufacturing operations are located in Australia, China, New
Zealand, and the Philippines.
Research and Development/Quality Assurance
The development of specialized products and services is a complex,
technical process calling upon the combined knowledge and talents of the
Company's research, development and quality assurance personnel. The Company
believes that its competitive advantage lies in its ability to work with its
customers to develop and deliver high-performance products that address the
distinct needs of those customers.
The Company's research, development and quality assurance personnel make
significant contributions toward improving existing products and developing new
products tailored to customer needs, while providing on-going technical support
and know-how to the Company's manufacturing activities. The Company employs
approximately 220 people in research and development and quality assurance.
Expenditures for research and development in 2000 were $18,294,000
compared with $18,245,000 million in the calendar year ended December 31, 1999,
and $17,055,000 in the calendar year ended December 31, 1998.
As part of its commitment to quality as a competitive advantage, the
Company has undertaken efforts to achieve certification to the requirements
established by the International Organization for Standardization in Geneva,
Switzerland, through its ISO 9000 series of quality standards. Sites currently
certified include Sensient Flavors & Fragrances Group plants in the United
States, Spain, Italy, Mexico, Belgium, Germany, the United Kingdom, Canada,
France and the Netherlands; Sensient Color Group plants in the United States,
the Netherlands, Mexico and United Kingdom; and Asia Pacific facilities in the
Philippines.
Products and Application Activities
With the Company's strategic focus on high-performance components that
bring life to products, the Company focuses on application activities and
processing improvements in support of its customers' numerous new and
reformulated products. The Company maintains many of its proprietary processes
and formulae as trade secrets and under secrecy agreements with customers.
Lower calorie ingredients and sweeteners for dairy, food and beverage
applications are a focus of development activity for the Flavors & Fragrances
Group. Formulations for functional and textured beverages and flavors for snack
and main meal items offer opportunities as well. Development of savory flavors
accelerated with the integration of the Company's BioProducts Division in 1998
and the Dehydrated Products Division in 2000. The development of yeast
derivatives and other specialty ingredients also provides growth opportunities
in bionutrients and biotechnology markets, such as pharmaceuticals, vitamins,
vaccines and bioremediation.
The natural food color market is a primary target for the Color Group. The
acquisitions of Reggiana, Forniciari and Dr. Marcus (as discussed above) have
provided new technologies in the extraction and purification of natural colors
and have enabled rapid growth in the beverage, dairy and snack food segments.
Recent expansion of the Color Group's purification technology will also open
further opportunities in the ink-jet market.
Raw Materials
In producing its products, the Company uses a wide range of raw materials.
Chemicals used to produce certified colors are obtained from several domestic
and foreign suppliers. Raw materials for natural colors, such as carmine,
beta-carotene, annatto and turmeric, are purchased from overseas and U.S.
sources. In the production of flavors and fragrances, the principal raw
materials include essential oils, aroma chemicals, botanicals, fruits and
juices, and are primarily obtained from local vendors. Flavor enhancers and
secondary flavors are produced from yeast, and vegetable materials such as corn
and soybean. Chili peppers, onion, garlic and other vegetables are acquired
under annual contracts with numerous growers in the western United States and
Europe.
The Company believes that alternate sources of materials are available to
enable it to maintain its competitive position in the event of an interruption
in the supply of raw materials from a single supplier.
Competition
All Company products are sold in highly competitive markets. While no
single factor is determinative, the Company's competitive position is based
principally on process and applications expertise, quality, technological
advances resulting from its research and development, and customer service and
support. Because of its highly differentiated products, the Company competes
with only a few companies across multiple ingredient lines, and is more likely
to encounter competition specific to an individual product.
o Flavors and Fragrances. Competition to supply the flavors and fragrances
industries has taken on an increasingly global nature. Most of the
Company's customers do not buy their entire flavor and/or fragrance
products from a single supplier. As a result, the Company does not compete
with a single company in all product categories. Competition for the
supply of flavors and fragrances is based on the development of customized
ingredients for new and reformulated customer products, as well as on
quality, customer service and price. Competition to supply dehydrated
vegetable products is present through several large and small domestic
competitors, as well competitors in other countries. Competition for the
supply of dehydrated vegetables is based principally on product quality,
customer service and price.
o Color. Competition in the color market is diverse, with the majority of
the Company's competitors specializing in either synthetic dyes or natural
colors. The Company believes that it gains a competitive advantage as the
only major basic manufacturer of a full range of color products, including
synthetic dyes and pigments as well as natural colors. Competition in the
supply of ink-jet inks is based principally upon price, quality and
service, as well as product development and technical capabilities. The
Company competes against two main domestic competitors in supplying ink-
jet inks and believes it gains an advantage as a low cost, high quality
supplier.
o Asia Pacific. Because of the broad array of products available to
customers of the Asia Pacific Division, the Company is able to offer a
wider product base than many of its competitors. Competition is based upon
reliability in product quality, service and price as well as technical
support available to customers.
Foreign Operations
The information appearing under the heading "Geographic Information" in
Note 11 to the Consolidated Financial Statements of the Company, which appears
on pages 40 and 41 of the Company's 2000 Annual Report, is incorporated herein
by reference.
Patents, Formulae and Trademarks
The Company owns or controls many patents, formulae and trademarks related
to its businesses. The businesses are not materially dependent upon patent or
trademark protection; however, trademarks, patents and formulae are important
for the continued consistent growth of the Company.
Employees
As of December 31, 2000, the Company employed 3,722 persons worldwide
including 349 employees with discontinued operations.
Regulation
Compliance with government provisions regulating the discharge of material
into the environment, or otherwise relating to the protection of the
environment, did not have a material adverse effect on the Company's operations
for the year covered by this report. Compliance is not expected to have a
material adverse effect in the succeeding two years as well. As is true with the
food industry in general, the production, packaging, labeling and distribution
of certain of the products of the Company are subject to the regulations of
various federal, state and local governmental agencies, in particular the U.S.
Food & Drug Administration.
Item 2. Properties
The locations and the nature of the primary production operations of the
Company's principal facilities are as follows:
Flavors & Fragrances Group:
United States
Amboy, IL: Ingredients and flavors
Fenton, MO: Flavors
Greenfield, CA: Dehydrated products
Harbor Beach, MI: Flavors and flavor enhancers
Indianapolis, IN: Flavors
Juneau, WI: Flavor enhancers and extracts
Livingston, CA: Dehydrated products
Turlock, CA: Dehydrated products
Belgium
Brussels: Natural health ingredients
Heverlee: Ingredients and flavors
Canada
Cornwall, Ontario: Flavor enhancers and extracts
Delta, B.C: Ingredients and flavors
Rexdale, Ontario: Ingredients and flavors
Tara, Ontario: Flavors and flavor enhancers
France
Marchais: Dehydrated products
Strasbourg: Flavor enhancers and extracts
Germany
Bremen: Flavors and juice/flavor systems
Great Britain
Bletchley: Flavors and extracts
Felinfach (Wales): Flavors and flavor enhancers
Ireland
Middleton: Dehydrated products
Italy
Milan: Flavors
Mexico
Celaya: Flavor enhancers and savory flavors
Mexico City/Vallejo: Fragrances
Tlalnepantla: Ingredients and flavors
Netherlands
Elboorg: Dehydrated products
Spain
Granada: Fragrances, aroma chemicals and extracts
Color Group:
United States
Elmwood Park, NJ (two plants):
Colors/dyes and ink-jet products
High Ridge, MO: Natural and synthetic colors
South Plainfield, NJ (two plants):
Cosmetic/pharmaceutical colors
St. Louis, MO: Natural and synthetic colors
Canada
Kingston, Ontario: Synthetic and natural colors
France
Saint Ouen L'Aumone: Cosmetic colors
Germany
Geesthacht (Hamburg): Natural colors
Great Britain
King's Lynn: Natural and synthetic colors and dyes
Prudhoe: Synthetic colors
Italy
Reggio Emilia (Parma) (two plants):
Natural colors
Mexico
Lerma: Synthetic and natural colors
Netherlands
Amersfoort: Synthetic colors
Asia Pacific:
Australia
Keysborough, Victoria:
Colors and flavors
China
Guangzhou (leased facility):
Colors and flavors
New Zealand
Mt. Wellington: Flavors
Philippines
Pasig City (Manila) (leased facility):
Colors and flavors
Except as noted above, all properties are owned and none is held subject to any
material encumbrance.
Item 3. Legal Proceedings
The Company is a party to various legal proceedings related to its
business. The Company believes that adverse decisions in these proceedings would
not, individually or in the aggregate, subject the Company to damages of a
material amount.
Item 4. Submission of Matters to a Vote of Security Holders
There were no matters submitted to a vote of security holders during the
last quarter of 2000.
Executive Officers of the Registrant
The executive officers of the Company and their ages as of March 1, 2001,
are as follows:
Name Age Position
---- --- --------
Kenneth P. Manning 59 Chairman, President and Chief Executive Officer
Richard Carney 50 Vice President - Human Resources
Steven O. Cordier 45 Vice President - Administration
Michael duBois 54 President - Flavors & Fragrances Group
John L. Hammond 54 Vice President, Secretary and General Counsel
Richard F. Hobbs 53 Vice President and Chief Financial Officer
Jack H. Koberstine 44 Vice President, Marketing
John R. Mudd 45 President - Color Group
Ralph G. Pickles 54 President - Asia Pacific
Stephen J. Rolfs 36 Vice President - Treasurer
Jorge E. Slater 53 President - Dehydrated Products
Dr. Ho-Seung Yang 53 Vice President - Technologies
The Company has employed all of the individuals named above for at least
the past five years, except Messrs. duBois, Hammond, Koberstine, Mudd, Rolfs,
Slater, and Yang.
Mr. duBois joined the Company in May 1998 as President of the Flavor
Division. From 1994 until joining the Company, Mr. duBois was employed by Bush
Boake Allen, Inc., a food flavor and fragrance company, as Vice President Sales
and Marketing, Flavors North America, and as Vice President/General Manager,
Seasonings Division. From 1991 to 1994, he served as Vice President - Sales and
Marketing, Flavor and Fruit Division for Sanofi Bio-Industries, a flavor
company. Prior to joining Sanofi, Mr. duBois held several positions with
Firmenich, Incorporated, a fragrance and flavor company.
Mr. Hammond joined the Company in January 1998, as Vice President,
Secretary and General Counsel. From 1992 to 1997, Mr. Hammond was employed by
The Providence Journal Company, a newspaper, cable and broadcast television
company, initially as Vice President - Legal, and subsequently as Vice
President, General Counsel and Chief Administrative Officer. From 1989 to 1992,
Mr. Hammond was Vice President, General Counsel and Secretary of Landstar
System, Inc., a trucking company. Prior to that,
Mr. Hammond was employed by The Singer Company for ten years and was Deputy
General Counsel at the time of his departure.
Mr. Koberstine joined the Company in 1998 as Vice President/General
Manager of the Dairy and Food Ingredients business of the Company's Flavor
Division. In April 2000, Mr. Koberstine became President of the Company's Red
Star Yeast & Products Division, and in February 2001, he became Vice President,
Marketing. Prior to joining the Company, Mr. Koberstine was employed by
Hercules, Inc. for 15 years, with his final assignment as Director of Sales and
Marketing, North America, for that company's food ingredients business.
Mr. Mudd re-joined the Company in January 2000 and became President of the
Company's Color Division in February 2000. Mr. Mudd served as President of
Monarch Food Colors from May 1993 until the Company acquired that business in
January 2000. Prior to his service with Monarch Food Colors, the Company had
employed Mr. Mudd for approximately 12 years.
Mr. Rolfs joined the Company as Manager - Corporate Development in 1997
and was appointed Vice President and Treasurer in July 2000. Prior to that
appointment, he served as the Company's Vice President-Development since 1998.
Prior to joining the Company, Mr. Rolfs was employed by Brown-Forman
Corporation, a beverage and consumer products company, from 1993 to 1997,
initially as a Financial Analyst and then as Assistant Vice President. Prior to
that, Mr. Rolfs worked for the public accounting firm of Ernst & Young from 1986
to 1991.
Mr. Slater was appointed President - Dehydrated Products Division in 2000.
Mr. Slater was first employed by the Company in August of 1996 and served as
Vice President and Managing Director of the Asia Pacific Division prior to being
elected its President in April 1998. From 1994 to 1996, Mr. Slater worked at
McCormick & Company, Inc., a spice and seasonings company, as Vice President and
Managing Director Asia Pacific. Prior to joining McCormick & Company, Inc., Mr.
Slater worked for Dole Packaged Foods Company and, prior to that, for
International Flavors and Fragrances, Inc.
Dr. Yang was elected Vice President - Technologies in January 1998. From
1990 to 1998, Dr. Yang was employed by SK Chemicals in Seoul, Korea, where he
held the positions of managing director of corporate planning and development,
managing director, group chairman's office and director, life science and
development.
PART II
Item 5. Market For The Registrant's Common Stock and Related Stockholder Matters
The only market in which the common stock of the Company is traded is the
New York Stock Exchange. The range of the high and low sales prices as quoted in
the New York Stock Exchange - Composite Transaction tape for the common stock of
the Company and the amount of dividends declared for fiscal 2000 appearing under
"Common Stock Prices and Dividends" on page 46 of the 2000 Annual Report to
Shareholders are incorporated by reference. In fiscal 2000, common stock
dividends were paid on a quarterly basis, and it is expected that quarterly
dividends will continue to be paid in the future.
On February 10, 2000, the Board of Directors established a share
repurchase program that authorizes the Company to repurchase up to five million
shares of the Company's common stock. As of March 9, 2001, 3,046,300 shares had
been repurchased under this program. This program replaced a share repurchase
program authorized in 1994 under which the Company had repurchased the entire
five million shares authorized for repurchase.
On June 25, 1998, the Board of Directors of the Company adopted a
preferred stock shareholder rights plan which is described in Note 6 of Notes to
Consolidated Financial Statements - "Shareholders' Equity" on pages 36 and 37 of
the 2000 Annual Report to Shareholders and which is incorporated by reference.
The number of shareholders of record on March 9, 2001 was 4,782.
Item 6. Selected Financial Data
The selected financial data required by this item is incorporated by
reference from the "Five Year Review" and the notes thereto on pages 44 and 45
of the 2000 Annual Report to Shareholders.
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The information required by this item is set forth under "Management's
Analysis of Operations and Financial Condition" on pages 22 through 27 of the
2000 Annual Report to Shareholders and is incorporated by reference.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
The information required by this item is set forth under "Market Risk
Factors" on pages 25 and 26 of the 2000 Annual Report to Shareholders and is
incorporated by reference.
Item 8. Financial Statements and Supplementary Data
The financial statements and supplementary data required by this item are
set forth on pages 28 through 43 of the 2000 Annual Report to Shareholders and
are incorporated by reference.
Item 9. Disagreements on Accounting and Financial Disclosure
None.
PART III
Item 10. Directors and Executive Officers of the Registrant
Information regarding directors and officers appearing under "Election of
Directors" (ending at "Committees of the Board of Directors") and "Section 16(a)
Beneficial Ownership Reporting Compliance" on pages two through five and page
17, respectively, of the Proxy Statement for Annual Meeting of Shareholders of
the Company dated March 28, 2001 ("Proxy Statement"), is incorporated by
reference. Additional information regarding executive officers appears at the
end of Part I above.
Item 11. Executive Compensation
Information relating to compensation of directors and officers is
incorporated by reference from "Director Compensation and Benefits" on page
seven of the Proxy Statement, "Compensation and Development Committee Report" on
pages 11 and 12 of the Proxy Statement, and "Executive Compensation" on pages 13
through 15 of the Proxy Statement.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The discussion of securities ownership of certain beneficial owners and
management appearing under "Principal Shareholders" on pages nine and 10 of the
Proxy Statement is incorporated by reference.
Item 13. Certain Relationships and Related Transactions
There are no family relationships between any of the directors, nominees
for director and officers of the Company nor any arrangement or understanding
between any director or officer or any other person pursuant to which any of the
nominees has been nominated. No director, nominee for director or officer had
any material interest, direct or indirect, in any business transaction of the
Company or any subsidiary during the period January 1, 2000, through December
31, 2000, or in any such proposed transaction. In the ordinary course of
business, the Company engages in business transactions with companies whose
officers or directors are also directors of the Company. These transactions are
routine in nature and are conducted on an arm's-length basis. The terms of any
such transactions are comparable at all times to those obtainable in business
transactions with unrelated persons.
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) Documents filed:
1. and 2: Financial Statements and Financial Statement Schedules.
See below for "List of Financial Statements and
Financial Statement Schedules."
3. Exhibits: The Exhibit Index following this report is incorporated
by reference herein. No instruments defining the rights
of holders of long-term debt of the Company and its
consolidated subsidiaries are filed herewith because,
with the exception of Exhibit 4.2, no long-term debt
instrument authorizes securities exceeding 10% of the
total consolidated assets of the Company. The Company
agrees to furnish a copy of any such instrument to the
Securities and Exchange Commission upon request.
(b) Reports on Form 8-K:
No reports on Form 8-K were filed during the quarter
ended December 31, 2000.
List of Financial Statements and Financial Statement Schedules
Page Reference in
1. Financial Statements 2000 Annual Report
To Shareholders
---------------
The following consolidated financial statements of
Sensient Technologies Corporation and subsidiaries are
incorporated by reference from the Annual Report to
Shareholders for the year ended December 31, 2000:
Independent Auditors' Report 43
Consolidated Balance Sheets-December 31, 2000 and 1999 29
Consolidated Statements of Earnings - Years ended
December 31, 2000, 1999 and 1998 28
Consolidated Statements of Shareholders' Equity -
Years ended December 31, 2000, 1999 and 1998 30-31
Consolidated Statements of Cash Flows - Years ended
December 31, 2000, 1999 and 1998 32
Notes to Consolidated Financial Statements 33-42
Page Reference in
2. Financial Statement Schedules Form 10-K Form 10-K
---------
Independent Auditors' Report 17
Schedule II - Valuation and Qualifying Accounts and Reserves 18
All other schedules are omitted because they are inapplicable, not required by
the instructions or the information is included in the consolidated financial
statements or notes thereto.
Independent Auditors' Report
To the Shareholders and Board of Directors
of Sensient Technologies Corporation:
We have audited the consolidated financial statements of Universal Foods
Corporation d/b/a Sensient Technologies Corporation and subsidiaries (the
"Company") as of December 31, 2000 and 1999, and for each of the three years in
the period ended December 31, 2000, and have issued our report thereon dated
February 23, 2001, which report includes an explanatory paragraph as to the
change in accounting of amortizing unrecognized net gains and losses related to
the Company's obligation for post-retirement benefits. Such consolidated
financial statements and report are included in your 2000 Annual Report to
Shareholders and are incorporated herein by reference. Our audits also included
the consolidated financial statement schedule of Sensient Technologies
Corporation, listed in Item 14. This consolidated financial statement schedule
is the responsibility of the Company's management. Our responsibility is to
express an opinion based on our audits. In our opinion, such consolidated
financial statement schedule, when considered in relation to the basic
consolidated financial statements taken as a whole, presents fairly in all
material respects the information set forth therein.
/s/ Deloitte & Touche LLP
Milwaukee, Wisconsin
February 23, 2001
SCHEDULE II
SENSIENT TECHNOLOGIES CORPORATION AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
(IN THOUSANDS)
YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998
Additions
Charged
Valuation Accounts Deducted in the Balance at to Costs Balance
Balance Sheet From the Assets To Beginning of and At End of
Which They Apply Period Expenses Deductions(A) Period
- ---------------- ------ -------- ------------- ------
1998
Allowance for losses: $4,059 $1,211 $359 $4,911
Trade accounts receivable ====== ====== ==== ======
1999
Allowance for losses: $4,911 $283 $1,143 $4.051
Trade accounts receivable ====== ==== ====== ======
2000
Allowance for losses: $4,051 $826 $2,029 $2,848
Trade accounts receivable ====== ==== ====== ======
(A) Accounts written off, less recoveries and reclassification of net assets
held for sale in 2000.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
UNIVERSAL FOODS CORPORATION
d/b/a SENSIENT TECHNOLOGIES CORPORATION
By: /s/ John L. Hammond
---------------------------
John L. Hammond
Vice President, Secretary &
General Counsel
Dated: March 28, 2001
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below as of March 28, 2001, by the following persons on
behalf of the Registrant and in the capacities indicated.
/s/ Kenneth P. Manning /s/ James A.D. Croft
- ------------------------------ ------------------------------
Kenneth P. Manning James A.D. Croft
Chairman of the Board, Director
President and Chief Executive
Officer
/s/ Richard F. Hobbs /s/ Alberto Fernandez
- ------------------------------ ------------------------------
Richard F. Hobbs Alberto Fernandez
Vice President and Chief Director
Financial Officer
/s/ Richard A. Abdoo /s/ James L. Forbes
- ------------------------------ ------------------------------
Richard A. Abdoo James L. Forbes
Director Director
/s/ Michael E. Batten /s/ Dr. Carol I. Waslien Ghazaii
- ------------------------------ ---------------------------------
Michael E. Batten Dr. Carol I. Waslien Ghazaii
Director Director
/s/ John F. Bergstrom /s/ William V. Hickey
- ------------------------------ ------------------------------
John F. Bergstrom William V. Hickey
Director Director
/s/ Dr. Fergus M. Clydesdale /s/ Essie Whitelaw
- ------------------------------ ------------------------------
Dr. Fergus M. Clydesdale Essie Whitelaw
Director Director
S-1
UNIVERSAL FOODS CORPORATION
D/B/A SENSIENT TECHNOLOGIES CORPORATION
EXHIBIT INDEX
2000 ANNUAL REPORT ON FORM 10-K
Exhibit Incorporated by Filed
Number Description Reference From Herewith
- ------ ----------- -------------- --------
3.1 Universal Foods Corporation Amended Exhibit A to Definitive Proxy
and Restated Articles of Incorporation, Statement filed on
adopted January 21, 1999 Schedule 14A on December 15, 1998
(Commission File No. 1-7626)
3.2 Universal Foods Corporation d/b/a Sensient Exhibit 3.2 to Quarterly Report on
Technologies Corporation Amended Form 10-Q for the quarter ended
and Restated Bylaws, adopted September 30, 2000 (Commission File No. 1-7626)
November 11, 1999, as amended
September 7, 2000
4.1 Rights Agreement, dated as of August Exhibit 1.1 to Registration Statement on
6, 1998 between Registrant and Firstar Form 8-A dated July 20, 1998
Trust Company (Commission File No. 1-7626)
4.1(1) Amendment dated as of November 6, 2000 Exhibit 4.1 to the Quarterly Report on
to the Rights Agreement dated as of Form 10-Q for the quarter ended
August 6, 1998, between Registrant and September 30, 2000 (Commission File No. 1-7626)
Wells Fargo Bank Minnesota, N.A. (as
Successor to Firstar Trust Company), as
Rights Agent
4.2 Indenture dated as of November 9, 1998 between Exhibit 4.1 to Registration Statement
Registrant and The First National on Form S-3 dated November 9, 1998
Bank of Chicago, as Trustee (Commission File 333-67015)
10 Material Contracts
10.1 Management Contracts or Compensatory
Plans
10.1(a) Executive Employment Contract Exhibit 10.2(a) to Annual Report on
between Registrant and Kenneth P. Manning Form 10-K for the fiscal year ended
dated November 11, 1999 September 30, 1999 (Commission File No. 1-7626)
10.1(b) Amended and Restated Change of Exhibit 10.2(b) to Annual Report on
Control Employment and Severance Form 10-K for the fiscal year ended
Agreement between Registrant and September 30, 1999 (Commission File No. 1-7626)
Kenneth P. Manning dated November 11, 1999
10.1(c) 1985 Stock Plan for Executive Exhibit 10.2(c) to Annual Report on
Employees Form 10-K for the fiscal year ended
September 30, 1998 (Commission File No. 1-7626)
UNIVERSAL FOODS CORPORATION
D/B/A SENSIENT TECHNOLOGIES CORPORATION
EXHIBIT INDEX
2000 ANNUAL REPORT ON FORM 10-K
Exhibit Incorporated by Filed
Number Description Reference From Herewith
- ------ ----------- -------------- --------
10.1(d) Universal Foods Corporation 1990 Exhibit 10.2(d) to Annual Report on
Employee Stock Plan, as amended Form 10-K for the fiscal year ended
September 10, 1998 September 30, 1998 (Commission File No. 1-7626)
10.1(d)(1) Amendment of 1990 Employee Stock Plan X
dated as of November 6, 2000
10.1(e) Universal Foods Corporation 1994 Exhibit 10.2(f) Annual Report on
Employee Stock Plan, as amended Form 10-K for the fiscal year ended
September 10, 1998 September 30, 1998 (Commission File No. 1-7626)
10.1 (e)(1) Amendment of 1994 Employee Stock Plan dated as of X
November 6, 2000
10.1(f) Universal Foods Corporation 1998 Exhibit 10.2(h) to Annual Report on
Stock Option Plan, as amended Form 10-K for the fiscal year ended
September 10, 1998 September 30, 1998 (Commission File No. 1-7626)
10.1(f)(1) Amendment of 1998 Employee Stock Plan dated as of X
November 6, 2000
10.1(g) 1999 Non-Employee Director Stock Appendix A to Definitive Proxy
Option Plan Statement filed on Schedule 14A on
December 17, 1999. (Commission File No. 1-7626)
10.1(g)(1) Amendment of 1999 Non-Employee Director Stock X
Option Plan dated as of November 6, 2000
10.1(h) Amended and Restated Directors Appendix B to Definitive Proxy
Deferred Compensation Plan Statement filed on Schedule 14A on
December 17, 1999 (Commission File No. 1-7626)
10.1(h)(1) Amendment No. 1 to the Directors Deferred X
Compensation Plan dated December 12, 2000
10.1(i) Management Income Deferral Plan, Exhibit 10.2(k) to Annual Report on
including Amendment No. 1 thereto Form 10-K for the fiscal year ended
dated September 10, 1998 September 30, 1998 (Commission File No. 1-7626)
10.1(i)(1) Amendment No. 2 to Management Income Deferral Plan X
dated June 15, 2000
10.1 (i)(2) Amendment No. 3 to Management Income Deferral Plan X
dated December 12, 2000
UNIVERSAL FOODS CORPORATION
D/B/A SENSIENT TECHNOLOGIES CORPORATION
EXHIBIT INDEX
2000 ANNUAL REPORT ON FORM 10-K
Exhibit Incorporated by Filed
Number Description Reference From Herewith
- ------ ----------- -------------- --------
10.1(j) Executive Income Deferral Plan, including Amendment Exhibit 10.2 (1) to Annual Report on
No. 1 thereto, dated September 10, 1998 Form 10-K for the fiscal year ended
September 30, 1998 (Commission File No. 1-7626)
10.1(j)(1) Amendment No. 2 to Executive Income Deferral Plan X
dated June 15, 2000
10.1(j)(2) Amendment No. 3 to the Executive Income Deferral X
Plan Dated December 12, 2000
10.1(k) Form of Amended and Restated Exhibit 10.2(n) to Annual Report on
Change of Control Employment and Form 10-K for the fiscal year ended
Severance Agreement for Executive September 30, 1998 (Commission File No. 1-7626)
Officers
10.1(k)(1) Form of Amendment to Change of Control Employment X
and Severance Agreement for Executive Officers
10.1(l) Sensient Technologies Corporation Rabbi X
Trust "A" Agreement dated January 1, 2001
between the Registrant and Marshall & Ilsley
Trust Company
10.1(m) Trust Agreement, including Changes Exhibit 10.2(p) to Annual Report on
upon Appointment of Successor Form 10-K for the fiscal year ended
Trustee dated as of February 1, 1998 September 30, 1998 (Commission File No. 1-7626)
between the Registrant and Firstar
Bank, Milwaukee, N.A. ("Rabbi Trust B")
10.1(m)(1) Amendment No. 1 to Rabbi Trust B X
dated January 1, 2001 between Registrant and
Marshall & Ilsley Trust Company
10.1(m)(2) Changes upon Appointment of Successor Trustee for X
Rabbi Trust B dated as of January 1, 2001
10.1(n) Trust Agreement, including Changes upon Appointment Exhibit 10.2(q) to Annual Report on
of Successor Trustee, dated as of February 1, Form 10-K for the fiscal year ended
1998 between the Registrant and Firstar Bank, September 30, 1998 (Commission File No. 1-7626)
Milwaukee N.A. ("Rabbi Trust C")
10.1(n)(1) Amendment No. 1 to Rabbi Trust C dated as of January 1, X
2001 between Registrant and Marshall & Ilsley Trust
Company
UNIVERSAL FOODS CORPORATION
D/B/A SENSIENT TECHNOLOGIES CORPORATION
EXHIBIT INDEX
2000 ANNUAL REPORT ON FORM 10-K
Exhibit Incorporated by Filed
Number Description Reference From Herewith
- ------ ----------- -------------- --------
10.1(n)(2) Changes upon Appointment of Successor Trustee for X
Rabbi Trust C dated as of January 1, 2001
10.1(o) Incentive Compensation Plan for Elected Appendix C to Definitive Proxy
Corporate Officers Statement filed on Schedule 14A
on December 17, 1999
(Commission File No. 1-7626)
10.1(o)(1) Amendment No. 1 to the Incentive Compensation Plan X
for Elected Corporate Officers dated December 12,
2000
10.1(p) Form of Management Incentive Plan for Division Exhibit 10.2 (s) to Annual Report on
Presidents Form 10-K for the fiscal year ended
September 30, 1998 (Commission File No. 1-7626)
10.1(p)(1) Amendment No. 1 to the Management Incentive Plan X
for Division Presidents dated December 12, 2000
10.1(q) Form of Management Incentive Plan for Exhibit 10.2(t) to Annual Report on
Corporate Management Form 10-K for the fiscal year ended
September 30, 1998 (Commission File No. 1-7626)
10.1(q)1) Amendment No. 1 to Management Incentive Plan for X
Corporate Management dated December 12, 2000
10.1(r) Form of Management Incentive Plan for Exhibit 10.2(u) to Annual Report on
Division Management Form 10-K for the fiscal year ended
September 30, 1998 (Commission File No. 1-7626)
10.1(r)(1) Amendment No. 1 to Management Incentive Plan for X
Division Management dated
December 12, 2000
10.1(s) Form of Agreement for Executive Exhibit 10.2(v) to Annual Report on
Officers (Supplemental Executive Form 10-K for the fiscal year ended
Retirement Plan A), including September 30, 1998 (Commission File No. 1-7626)
Amendment No.1 thereto dated
September 10, 1998
10.1(s)(1) Amendment No. 2 to the Supplemental Executive X
Retirement Plan A dated June 15, 2000
10.1(s)(2) Amendment No.3 to the Supplemental Executive
Retirement Plan A dated December 12, 2000 X
UNIVERSAL FOODS CORPORATION
D/B/A SENSIENT TECHNOLOGIES CORPORATION
EXHIBIT INDEX
2000 ANNUAL REPORT ON FORM 10-K
Exhibit Incorporated by Filed
Number Description Reference From Herewith
- ------ ----------- -------------- --------
10.1(t) Form of Agreement for Executive Officers X
(Supplemental Executive Retirement Plan B),
including Amendment No. 1 thereto dated September
10, 1998
10.1(t)(1) Amendment No. 2 to Supplemental Executive X
Retirement Plan B dated June 15, 2000
10.1(t)(2) Amendment No. 3 to Supplemental Executive X
Retirement Plan B dated December 12, 2000
10.1(u) Universal Foods Corporation Supplemental Benefit Exhibit 10.2(w) to Annual report on
Plan , including Amendment No. 1 thereto dated Form 10-K for the fiscal year ended
September 10, 1998 September 30, 1998 (Commission File No. 1-7626)
10.1(u)(1) Amendment No. 2 to Supplemental Benefit Plan dated X
December 12, 2000
10.1(v) Universal Foods Corporation Transition Retirement Exhibit 10.2(x) to the
Plan, including Amendment No. 1 thereto, dated Company's Annual Report on Form
September 10, 1998 10-K for the fiscal year ended
September 30, 1998 (Commission File No. 1-7626)
10.1(v)(1) Amendment No. 2 to the Transition Retirement Plan X
dated December 12, 2000
13.1 Portions of Annual Report to Shareholders X
for the year ending December 31, 2000
that are incorporated by reference
18 Deloitte & Touche LLP Letter re Change in Accounting X
Principle
21 Subsidiaries of the Registrant X
23 Consent of Deloitte & Touche LLP X
99 Notice of Annual Meeting and Proxy Filed on Schedule 14A
Statement dated March 28, 2001. dated March 28, 2001
(Commission File No. 1-7626)
Except to the extent specifically incorporated
by reference herein, the Proxy Statement shall not
be deemed to be filed with the Securities and
Exchange Commission as part of this Annual Report
on Form 10-K