USA – Ingredion, a leading global provider of ingredient solutions, has recorded robust profit growth from its operations in the second quarter of fiscal 2023, as production adjusts in response to shifting consumer demands.
According to the company’s president and CEO James P. Zalie, net income for the quarter that ended June 30 was US$ 163 million, equal to US$2.46 per share on the common stock, up 15% from US$ 142 million, or US$ 2.14 per share, in the same period a year ago.
“Our performance this quarter demonstrates the value of a diversified portfolio, where North America’s strength in core ingredients and EMEA’s strength in specialities contributed to record second-quarter net sales and operating income,” Mr. Zallie said.
“These results are particularly noteworthy given the strength of last year’s second-quarter performance and demonstrate that we maintain our ability to price and pass through significant raw material inflation.”
He added that the company’s specialty ingredients net sales increased by 3% in the quarter behind better price mix noting that the company also benefitted from more collaborations with customers seeking to improve the affordability of the recipes.
In addition, the CEO noted that the company has also recently launched a snacking innovation centre which seeks to capture additional growth opportunities for Ingredion in the global snacking category.
He said the category has been growing by 3% to 5% over the past five years and the segment presents an excellent opportunity for Ingredion to leverage its complete solutions capability across speciality starches, plant-based proteins and sweeteners.
“Our snacking experts have deep technical proficiency that allows them to engage with customers in new ways, providing proprietary insights and market-ready prototypes across a variety of snack applications,” he said.
“This collaboration has helped us develop more projects with larger snack companies globally and has created a multimillion-dollar pipeline tapping into the snacking category’s high growth potential.”
In North America, the company’s largest business unit, second-quarter operating income was US$197 million, up 22% from US$161 million in the same period of 2022. Sales totalled US$1.34 billion, an increase of 5% from US$1.28 billion.
In a statement, Ingredion’s executive vice president and chief financial officer, James Derek Gray said that the increase was driven by a strong price mix as well as strengthening core ingredients sales.
Ingredion said it now expects full-year sales to be up mid-to-high single digits, reflecting softer sales volume and the anticipated layout of corn costs.
Cash from operations for fiscal 2023 is expected to be in the range of US$600 million to US$700 million, up from an earlier forecast of US$550 million to US$650 million.