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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended: March 31, 2003
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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
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SENSIENT TECHNOLOGIES CORPORATION
---------------------------------
(Exact name of registrant as specified in its charter)
Wisconsin 39-0561070
- ------------------------- ----------
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
777 East Wisconsin Avenue, Milwaukee, Wisconsin 53202-5304
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(Address of principal executive offices)
Registrant's telephone number, including area code: (414) 271-6755
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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 whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes X No
Indicate the number of shares outstanding of each of the issuer's classes of
Common Stock as of the latest practicable date.
Class Outstanding at April 30, 2003
- ------------------------------------------ -----------------------------
Common Stock, par value $0.10 per share 47,119,974 shares
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SENSIENT TECHNOLOGIES CORPORATION
INDEX
Page No.
--------
PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements:
Consolidated Condensed Statements of Earnings
- Three Months Ended March 31, 2003 and 2002. 1
Consolidated Condensed Balance Sheets
- March 31, 2003 and December 31, 2002. 2
Consolidated Condensed Statements of Cash Flows
- Three Months Ended March 31, 2003 and 2002. 3
Notes to Consolidated Condensed Financial Statements. 4
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations. 7
Item 3. Quantitative and Qualitative Disclosures About Market Risk. 9
Item 4. Controls and Procedures. 9
PART II. OTHER INFORMATION:
Item 6. Exhibits and Reports on Form 8-K. 10
Signatures. 10
Certifications. 11
Exhibit Index. 13
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
SENSIENT TECHNOLOGIES CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(In thousands except per share amounts)
(Unaudited)
Three Months
Ended March 31,
-----------------------
2003 2002
-------- --------
Revenue $235,097 $213,123
Cost of products sold 157,593 142,526
Selling and administrative expenses 42,570 38,062
-------- --------
Operating income 34,934 32,535
Interest expense 7,245 7,616
-------- --------
Earnings before income taxes 27,689 24,919
Income taxes 7,227 7,974
-------- --------
Net earnings $ 20,462 $ 16,945
======== ========
Average number of common shares outstanding:
Basic 47,058 47,344
======== ========
Diluted 47,398 47,670
======== ========
Earnings per common share:
Basic $ .43 $ .36
======== ========
Diluted $ .43 $ .36
======== ========
Dividends per common share $ .1400 $ .1325
======== ========
See accompanying notes to consolidated condensed financial statements.
-1-
SENSIENT TECHNOLOGIES CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
March 31, December 31,
ASSETS 2003 2002
------ ----------- -----------
CURRENT ASSETS:
Cash and cash equivalents $ 4,557 $ 2,103
Trade accounts receivable, net 168,549 160,155
Inventories 273,673 269,701
Prepaid expenses and other current assets 46,484 43,619
----------- -----------
TOTAL CURRENT ASSETS 493,263 475,578
----------- -----------
OTHER ASSETS 90,031 85,679
GOODWILL 385,469 384,241
INTANGIBLE ASSETS, NET 13,014 13,235
PROPERTY, PLANT AND EQUIPMENT:
Land and buildings 181,262 182,464
Machinery and equipment 482,346 462,925
----------- -----------
663,608 645,389
Less accumulated depreciation (325,928) (314,151)
----------- -----------
337,680 331,238
----------- -----------
TOTAL ASSETS $ 1,319,457 $ 1,289,971
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES:
Trade accounts payable $ 50,181 $ 55,546
Accrued salaries, wages and withholdings from employees 10,425 14,197
Other accrued expenses 68,255 65,069
Income taxes 27,172 27,526
Short-term borrowings 56,223 34,618
Current maturities of long-term debt 12,290 12,374
----------- -----------
TOTAL CURRENT LIABILITIES 224,546 209,330
DEFERRED INCOME TAXES 11,839 10,942
OTHER LIABILITIES 20,056 18,694
ACCRUED EMPLOYEE AND RETIREE BENEFITS 37,368 39,940
LONG-TERM DEBT 514,446 511,707
SHAREHOLDERS' EQUITY:
Common stock 5,396 5,396
Additional paid-in capital 72,374 72,390
Earnings reinvested in the business 635,224 621,525
Treasury stock, at cost (139,243) (137,074)
Unearned portion of restricted stock (2,737) (2,951)
Accumulated other comprehensive income (loss) (59,812) (59,928)
----------- -----------
TOTAL SHAREHOLDERS' EQUITY 511,202 499,358
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 1,319,457 $ 1,289,971
=========== ===========
See accompanying notes to consolidated condensed financial statements.
-2-
SENSIENT TECHNOLOGIES CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Three Months
Ended March 31,
----------------------
2003 2002
-------- --------
Net cash provided by operating activities $ 853 $ 23,371
-------- --------
Cash flows from investing activities:
Acquisition of property, plant and equipment (10,336) (5,099)
Acquisition of new businesses (net of cash acquired) (4,107) (43,374)
Proceeds from sale of assets 1,948 3,492
Decrease in other assets 68 26
-------- --------
Net cash used in investing activities (12,427) (44,955)
-------- --------
Cash flows from financing activities:
Proceeds from additional borrowings 23,232 22,554
Reduction in debt (691) (313)
Purchase of treasury stock (4,969) --
Dividends paid (6,763) (6,286)
Proceeds from options exercised and other 2,693 3,447
-------- --------
Net cash provided by financing activities 13,502 19,402
-------- --------
Effect of exchange rate changes on cash and cash equivalents 526 (84)
-------- --------
Net increase (decrease) in cash and cash equivalents 2,454 (2,266)
Cash and cash equivalents at beginning of period 2,103 2,317
-------- --------
Cash and cash equivalents at end of period $ 4,557 $ 51
======== ========
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest $ 2,705 $ 3,069
Income taxes 5,987 6,234
Liabilities assumed in acquisitions $ -- $ 10,539
See accompanying notes to consolidated condensed financial statements.
-3-
SENSIENT TECHNOLOGIES CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)
1. Accounting Policies
In the opinion of the Company, the accompanying unaudited consolidated
condensed financial statements contain all adjustments (consisting of only
normal recurring accruals) necessary to present fairly the financial
position of the Company as of March 31, 2003 and December 31, 2002, and
the results of operations and cash flows for the three months ended March
31, 2003 and 2002. The results of operations for any interim period are
not necessarily indicative of the results to be expected for the full
year.
Expenses are charged to operations in the year incurred. However, for
interim reporting purposes, certain expenses are charged to operations
based on an estimate rather than as expenses are actually incurred.
Certain amounts as previously presented have been reclassified to conform
to the current period presentation.
Refer to the notes in the Company's annual consolidated financial
statements for the year ended December 31, 2002, for additional details of
the Company's financial condition and a description of the Company's
accounting policies, which have been continued without change.
2. Inventories
At March 31, 2003 and December 31, 2002, inventories included finished and
in-process products totaling $201.9 million and $195.9 million,
respectively, and raw materials and supplies of $71.8 million and $73.8
million, respectively.
3. Segment Information
Operating results and the related assets by segment for the periods
presented are as follows:
(In thousands) Flavors & Corporate
Fragrances Color & Other Consolidated
---------- ---------- ---------- ------------
Three months ended March 31, 2003:
Revenues from external customers $ 133,966 $ 86,153 $ 14,978 $ 235,097
Intersegment revenues 5,562 3,415 -- 8,977
---------- ---------- ---------- ----------
Total revenue $ 139,528 $ 89,568 $ 14,978 $ 244,074
========== ========== ========== ==========
Operating income (loss) $ 20,028 $ 20,196 $ (5,290) $ 34,934
Interest expense -- -- 7,245 7,245
---------- ---------- ---------- ----------
Earnings (loss) before income taxes $ 20,028 $ 20,196 $ (12,535) $ 27,689
========== ========== ========== ==========
Assets $ 611,328 $ 560,058 $ 148,071 $1,319,457
========== ========== ========== ==========
Three months ended March 31, 2002:
Revenues from external customers $ 128,877 $ 70,497 $ 13,749 $ 213,123
Intersegment revenues 5,005 5,391 -- 10,396
---------- ---------- ---------- ----------
Total revenue $ 133,882 $ 75,888 $ 13,749 $ 223,519
========== ========== ========== ==========
Operating income (loss) $ 18,937 $ 17,789 $ (4,191) $ 32,535
Interest expense -- -- 7,616 7,616
---------- ---------- ---------- ----------
Earnings (loss) before income taxes $ 18,937 $ 17,789 $ (11,807) $ 24,919
========== ========== ========== ==========
Assets $ 532,353 $ 494,456 $ 118,590 $1,145,399
========== ========== ========== ==========
-4-
4. Acquisitions
During the first three months of 2003, the Company acquired certain assets
of Kyowa Koryo Kagaku Kabushiki Kaisha, a former Japanese flavor producer,
for $4.1 million (net of cash acquired). The Company has not completed the
purchase price allocation related to the acquisition.
During the first three months of 2002, the Company acquired three
businesses for cash in an aggregate amount of $43.4 million (net of cash
acquired). The businesses acquired were ECS Specialty Inks and Dyes, a
producer and marketer of inks for specialty printing applications, the
flavors and essential oil operations of C. Melchers GmbH & Company, and
SynTec GmbH, a manufacturer of specialty dyes and chemicals for the
imaging industry. The Company may be required to pay up to 4.6 million
Euro ($4.9 million) of additional cash consideration for the 2002
acquisitions subject to specific performance targets in the first two
years following the acquisitions.
5. Shareholders' Equity Disclosures
During the three months ended March 31, 2003, the Company repurchased 0.3
million shares of its common stock for an aggregate price of $5.0 million.
The Company did not repurchase any shares of its common stock during the
three months ended March 31, 2002.
Comprehensive income is comprised of net earnings, foreign currency
translation and unrealized gains and losses on cash flow hedges. Total
comprehensive income for the three months ended March 31, 2003 and 2002
was $20.6 million and $17.2 million, respectively.
6. Stock Plans
The Company has adopted the disclosure-only provisions of Statement of
Financial Accounting Standards ("SFAS") No. 123, "Accounting for
Stock-Based Compensation." Stock options are granted at prices equal to
the fair value of the Company's common stock on the dates of grant.
Accordingly, no significant compensation cost has been recognized for the
grant of stock options under the Company's stock option plans. If the
Company had elected to recognize compensation cost based on the fair value
of the options granted at grant date as prescribed by SFAS No. 123, net
earnings and earnings per common share would have been reduced to the pro
forma amounts indicated below:
Three Months
Ended March 31,
----------------------------
2003 2002
---------- ----------
Net earnings:
As reported $ 20,462 $ 16,945
Add: reported stock compensation
expense - net of tax 132 106
Less: fair value stock compensation
expense - net of tax (487) (599)
---------- ----------
Pro forma net earnings $ 19,975 $ 16,346
========== ==========
Earnings per common share:
Basic as reported $ .43 $ .36
Less: net impact of fair value stock
expense - net of tax (.01) (.01)
---------- ----------
Basic pro forma $ .42 $ .35
Diluted as reported $ .43 $ .36
Less: net impact of fair value stock
expense - net of tax (.01) (.02)
---------- ----------
Diluted pro forma $ .42 $ .34
-5-
7. Cash Flows from Operating Activities
Cash flows from operating activities are detailed below:
Three Months Ended March 31,
----------------------------
2003 2002
-------- --------
Cash flows from operating activities:
Net earnings $ 20,462 $ 16,945
Adjustments to arrive at net cash provided
by operating activities:
Depreciation and amortization 11,074 9,680
Gain on sale of assets (1,470) (111)
Changes in operating assets and liabilities (net of
effects of acquisitions of businesses) (29,213) (3,143)
-------- --------
Net cash provided by operating activities $ 853 $ 23,371
======== ========
8. Guarantees
In connection with the sale of substantially all of the Company's Yeast
business on February 23, 2001, the Company has provided the buyer of these
operations with indemnification against certain potential liabilities as
is customary in transactions of this nature. The period provided for
indemnification against most types of claims has now expired, but for
specific types of claims including, but not limited to tax and
environmental liabilities, the amount of time provided for indemnification
is either five years or the applicable statute of limitations. The maximum
amount of the Company's liability related to these provisions is capped at
approximately 35% of the consideration received in the transaction. In
cases where the Company believes it is probable that payments will be
required under these provisions, a liability was recognized at the time of
the asset sale. The Company believes that the probability of incurring
payments under these provisions in excess of the amount of the liability
recorded is remote.
-6-
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
OVERVIEW
Revenue for the quarter ended March 31, 2003 increased by 10.3% to
$235.1 million from $213.1 million for the comparable quarter of 2002.
Revenue for the Flavors & Fragrances segment increased 4.2% for the
quarter over the comparable period last year. The Color segment
increased revenue by 18.0% for the quarter over the comparable period
last year. Additional information on group results can be found in the
Segment Information section.
Gross profit margin for the quarter ended March 31, 2003 was 33.0%,
which was consistent with the gross profit margin of 33.1% for the same
period last year.
Selling and administrative expenses as a percent of revenue increased to
18.1% for the three months ended March 31, 2003 compared to 17.9% in the
comparable period of 2002. The increase was primarily attributable to
currency fluctuations.
Operating income for the three months ended March 31, 2003 was $34.9
million, an increase of 7.4% from $32.5 million for the third quarter
last year.
Favorable foreign exchange rates increased revenue and operating income
by approximately 5% and 4%, respectively, for the three months ended
March 31, 2003 over the comparable period last year.
Interest expense for the three months ended March 31, 2003 declined to
$7.2 million from $7.6 million for the first quarter last year. The
decrease was a result of lower interest rates more than offsetting
higher average debt balances.
The effective income tax rate was 26.1% and 32.0% for the three months
ended March 31, 2003 and 2002, respectively. The effective tax rate for
the quarter ended March 31, 2003 was reduced by the favorable settlement
of certain prior year tax matters. Management expects the effective tax
rate for the remainder of 2003 to be 32.0%.
SEGMENT INFORMATION
Flavors & Fragrances - The Flavors & Fragrances segment reported a 4.2%
increase in revenue, to $139.5 million for the first quarter of 2003
compared to $133.9 million for the same period last year. Favorable
foreign exchange rates resulted in a 5.2% increase in revenue and
acquired businesses contributed a 2.7% increase in revenue. Higher
revenue as a result of these factors was offset by soft U.S. demand for
flavors. Operating income in the quarter of $20.0 million increased 5.8%
compared to last year and operating margins increased 30 basis points,
to 14.3%. Profit within the European flavor operations improved by $1.6
million excluding foreign currency effects, with every significant
profit center reporting higher profitability. Operating income in the
dehydrated flavors business improved by $.7 million as a result of
operating efficiencies and a favorable 2002 harvest. These gains were
partially offset by decreases within the traditional U.S. flavor
business.
Color - Revenue for the Color segment increased by $13.7 million, or
18.0% to $89.6 million in the first quarter of 2003. Approximately 40%
of the increase was attributable to organic growth in the North American
food color and inkjet ink product lines. Foreign exchange and
acquisitions each contributed approximately 30% of the increase in
revenue. Operating income in the first quarter of 2003 was $20.2 million
versus $17.8 million from the 2002 first quarter. Operating income as a
percent of revenue was 22.5%, a decrease of 90 basis points from the
comparable quarter last year primarily as a result of lower gross
margins realized in the technical color business during the quarter.
-7-
FINANCIAL CONDITION
The Company's ratio of debt to total capital was 53.3% as of March 31,
2003, up from 52.8% as of December 31, 2002. The increase resulted from
an increase in debt needed to fund capital expenditures and treasury
share purchases.
Net cash provided by operating activities was $0.9 million for the three
months ended March 31, 2003, compared to $23.4 million for the three
months ended March 31, 2002. The decrease in cash provided by operating
activities was primarily due to increased inventory levels. Inventories
increased during the first quarter of 2003 from temporary softness in
the U.S. flavor business as well as from the manufacturing consolidation
plan for a recently acquired Color business, which will be completed by
the end of the third quarter of 2003.
Net cash used in investing activities was $12.4 million for the three
months ended March 31, 2003 compared to $45.0 million of net cash used
in investing activities in the comparable period last year. Net cash
used in investing activities in 2003 included capital expenditures of
$10.3 million and acquisitions of $4.1 million. Cash used in investing
activities in 2002 included acquisitions of $43.4 million and capital
expenditures of $5.1 million.
Net cash provided by financing activities was $13.5 million for the
three months ended March 31, 2003, compared to $19.4 million of net cash
provided in the comparable period in the prior year. Net borrowings of
$22.5 million in 2003 were consistent with net borrowings of $22.2
million in 2002. During 2003, the borrowings were used to fund capital
expenditures, acquisitions, and treasury stock purchases. During 2002,
net borrowings were used to fund capital expenditures and acquisitions.
Dividends of $6.8 million and $6.3 million were paid during the three
months ended March 31, 2003 and 2002, respectively.
The Company increased its quarterly cash dividend per share from $.1325
to $.14 per share effective in December 2002. In addition, the Company
raised its quarterly dividend to 15 cents per share payable on June 2,
2003 to shareholders of record on May 8, 2003. As a result of these
increases, the annual dividend has grown from $.53 to $.60 per share
since the third quarter of 2002.
The Company's financial position remains strong. Its expected cash flows
from operations and existing lines of credit can be used to meet future
cash requirements for operations, capital expansion programs and
dividend payments to shareholders.
CRITICAL ACCOUNTING POLICIES
In preparing the financial statements in accordance with accounting
principles generally accepted in the U.S., management is required to
make estimates and assumptions that have an impact on the assets,
liabilities, revenue, and expense amounts reported. These estimates can
also affect supplemental information disclosures of the Company,
including information about contingencies, risk, and financial
condition. The Company believes, given current facts and circumstances,
its estimates and assumptions are reasonable, adhere to accounting
principles generally accepted in the U.S., and are consistently applied.
Inherent in the nature of an estimate or assumption is the fact that
actual results may differ from estimates and estimates may vary as new
facts and circumstances arise. The Company makes routine estimates and
judgments in determining the net realizable value of accounts
receivable, inventories, property, plant and equipment, and prepaid
expenses. In addition to these estimates and judgments, management
believes the Company's most critical accounting estimates and
assumptions are in the following areas:
Goodwill Valuation
The Company reviews the carrying value of goodwill annually utilizing
several valuation methodologies, including a discounted cash flow model.
Changes in estimates of future cash flows caused by items such as
unforeseen events or changes in market conditions, could negatively
affect the reporting segment's fair value and result in an impairment
charge. However, the current fair values of the reporting segments are
significantly in excess of carrying values, and accordingly management
believes that only significant changes in the cash flow assumptions
would result in impairment.
-8-
Income Taxes
The Company files income tax returns and estimates its income tax
expense in each of the taxing jurisdictions in which it operates. The
Company is subject to a tax audit in each of these jurisdictions, which
could result in changes to the estimated tax expense. The amount of
these changes would vary by jurisdiction and would be recorded when
known. These changes could be significant to the Company's financial
statements. Management has recorded valuation allowances to reduce its
deferred tax assets to the amount that is more likely than not to be
realized. In doing so, management has considered future taxable income
and ongoing tax planning strategies in assessing the need for the
valuation allowance. An adjustment to the recorded valuation allowance
as a result of changes in facts or circumstances could result in a
significant change in the Company's tax expense.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There have been no material changes in the Company's market risk during
the quarter ended March 31, 2003. For additional information on market
risk, refer to pages 25 and 26 of the Company's 2002 Annual Report,
portions of which were filed as Exhibit 13.1 to the Company's Form 10-K
for the year ended December 31, 2002.
ITEM 4. CONTROLS AND PROCEDURES
The Company maintains a system of disclosure controls and procedures
that is designed to assure that information, which is required to be
disclosed by the Company, is accumulated and communicated to management
in a timely manner. Management has reviewed this system of disclosure
controls and procedures within 90 days of the date hereof, and has
concluded that the current system of controls and procedures is
effective.
The Company maintains a system of internal controls and procedures for
financial reporting. Since the date of management's most recent
evaluation, there were no significant changes in internal controls or in
other factors that could significantly affect internal controls.
FORWARD-LOOKING STATEMENTS
This document contains forward-looking statements that reflect
management's current assumptions and estimates of future economic
circumstances, industry conditions, Company performance and financial
results. The Private Securities Litigation Reform Act of 1995 provides a
safe harbor for such forward-looking statements. Such forward-looking
statements are not guarantees of future performance and involve known
and unknown risks, uncertainties and other factors that could cause
actual events to differ materially from those expressed in those
statements. A variety of factors could cause the Company's actual
results and experience to differ materially from the anticipated
results. These factors and assumptions include the pace and nature of
new product introductions by the Company's customers; execution of the
Company's acquisition program and results of newly acquired businesses;
the Company's ability to successfully implement its growth strategies;
industry and economic factors related to the Company's domestic and
international business; growth in markets for products in which the
Company competes; industry acceptance of price increases and currency
exchange rate fluctuations. The Company does not undertake to publicly
update or revise its forward-looking statements even if experience or
future changes make it clear that any projected results expressed or
implied therein will not be realized.
-9-
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits. (See Exhibit Index following this report.)
(b) Reports on Form 8-K. A report on Form 8-K was filed on April
17, 2003 to disclose earnings for the quarter ended March 31,
2003.
SIGNATURES
Pursuant to the requirements 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.
SENSIENT TECHNOLOGIES CORPORATION
Date: May 14, 2003 By: /s/ John L. Hammond
-------------------------
John L. Hammond, Vice President,
Secretary & General Counsel
Date: May 14, 2003 By: /s/ Richard F. Hobbs
--------------------------
Richard F. Hobbs, Vice President,
Chief Financial Officer & Treasurer
-10-
CERTIFICATIONS
I, Kenneth P. Manning, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Sensient
Technologies Corporation;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this
quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date
of this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent function):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and
material weaknesses.
Date: May 14, 2003
By: /s/ Kenneth P. Manning
- --------------------------
Kenneth P. Manning, Chairman,
President & Chief Executive Officer
-11-
CERTIFICATIONS
I, Richard F. Hobbs, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Sensient
Technologies Corporation;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this
quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date
of this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent function):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and
material weaknesses.
Date: May 14, 2003
By: /s/ Richard F. Hobbs
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Richard F. Hobbs, Vice President,
Chief Financial Officer & Treasurer
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SENSIENT TECHNOLOGIES CORPORATION
EXHIBIT INDEX
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 2003
Exhibit Description Incorporated by Reference From Filed Herewith
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99.1 Certification of Sensient's Chairman, President X
& Chief Executive Officer and Vice President,
Chief Financial Officer & Treasurer pursuant to
18 United States Code Section 1350
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