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Deutsche Bank
Global
Consumer
Conference
Andreas Fibig
Chairman & CEO
1. Introduction
2. Strategic Vision
3. Financial Perspective
4. Q&A
Insight Into Our Market
Estimated 2016 market size: ~$20B; growing 2 to 3% per year to 2020
Category Breakdown Market Growth Rates
Cosmetic 4.5%
Actives
8%
Fragrance
Ingredients
14%
Flavors 2.5%
Compounds
46% 2.0%
1.5%
Fragrance
Compounds
32%
Fragrance Fragrances Flavors Cosmetic
Ingredients Compounds Compounds Actives
Note: Total 2016 market potential of ~$20B based on Company estimates using 2015 market data and assuming Company estimates of category growth rates shown above
Well-Positioned Within Our Industry
Estimated market share summary as of 2016
Flavors & Fragrances Cosmetic Actives
Croda
BASF 7%
10%
Givaudan
Other
DSM
25% 5%
31%
IFF
Other 4%
52% Lonza
IFF 4%
Symrise 16%
Bioland
12% 4%
Firmenich
16% Symrise
4%
Gattefosse Silab Givaudan
Note: Based on Company estimates 3% 3% 4%
IFF By The Numbers
Innovation driven global organization
6 42 70
Creative &
75%
R&D Manufacturing Sales
centers facilities Application Centers outside North America
+5%*
5-Year Currency
20.0%*
2016 Adjusted
Neutral Sales CAGR Operating Profit Margin
17.2%
2016 Operating
17.6%*
2016 Adjusted Return
Cash Flow as % of Sales on Invested Capital
* Currency Neutral Sales, Adjusted Operating Profit Margin and Adjusted Return on Invested Capital
(ROIC) are Non-GAAP metrics, please see our GAAP to Non-GAAP Reconciliation at ir.iff.com
Long-Term Strategic Vision
Framework to achieve continuous growth
Vision 2020
We are the catalyst for discoveries that spark the senses and transform the everyday
Continuously Improving
+31%
CAGR
Generation: 1 2 3 4 5 6
Description: First capsule Improved Improved Targeted Improved Improved
to market base stability retention on personal care release for deposition &
fabric & skin applications fabric apps adhesion to
hair, fabric
and skin
Fabric:
Home:
Personal:
Fine:
Innovating Firsts: Fragrances
New molecule pipeline strong
+69% +55%
EAME +4%
Greater
Asia +6%
North
America +7%
Latin
America (1)%
Sales as a % of Total CPG Industry 2011-16 Market 2011-16 Growth within the NOAM food & beverage market
Share Growth (PP) Sales CAGR % primarily driven by small to mid-size companies
$710B $786B $797B Total - +2.3
100
14.6 14.9 14.6 Private
0.0 +2.2 Go-to-market approach requires specific criteria versus
90 Label
7.6 Extra the traditional model used for global customers
80 8.4 8.8 Small +1.2 +5.4
70 11.9 12.9 13.1 Small +1.2 +4.2
Through recent acquisitions of Ottens Flavors and David
60 17.0 17.3 17.3 Midsize +0.3 +2.8 Michael, we increased capabilities to serve small and
50 mid-sized customers
40
30
48.8 46.5 46.2 Large -2.6 +1.2 Expected to roll-out differentiated service model at 2017
20 IFT (Institute of Food Technologists) tailored
10 specifically for servicing for this segment
0
2011 2015 2016
Large Midsize Small Extra Small Private Label
Leadership
Strengthened leadership
development programs and 82 33
Development embedded talent and execution Graduates Graduates
objectives for senior leaders Since Inception In Class of 2016
Talent
Pipeline Advanced our best-in-class pipeline IFF Perfumery
R&D Leadership Seasonings
with 7 technical schools School Flavorist
Academy
+ School
Ensuring Continued Success
Unlock savings, refine strategic priorities & deploy investments
Focus Execution
1
Extend zero-based budgeting throughout the organization
Productivity Implement more simplified organizational structure
Accelerate value realization of recent acquisitions
2
Continuously refine priorities to ensure changing market dynamics are captured
Strategy Reassess market position/ competitiveness by region, category & customer
If necessary, augment strategic priorities to continue to drive shareholder value
3
Further strengthen R&D and innovation platforms
Deployment Redeploy resources to highest return opportunities
Drive capital allocation for maximum value creation
Commitment To Maximizing Shareholder Value
Driving sustainable improvements across our key financial metrics
Adjusted Adjusted
Sales*
Operating Profit* EPS*
7.5 - 8.5%
6.5 -7.5%
5.5 - 6.5%
6%
5%
4%
* Currency Neutral Sales, Currency Neutral Adjusted Operating Profit and Currency Neutral Adjusted 20
EPS are Non-GAAP metrics, please see our GAAP to Non-GAAP Reconciliation at ir.iff.com
Strong Capital Allocation Strategy
Three primary uses of cash
Capital
Capital
Expenditures
Expenditures
Financial Cash
Acquisitions Returned to
Flexibility Shareholders
CapEx To Support Organic Business
Investing in technology and infrastructure
Capital Expenditures
As a % of Sales
4.0% ~ 4.0%
~ 3.5%
$1B
Value Creation Drivers
Companies with differentiated technology
Access to under-indexed markets or customers
Potential adjacencies that leverage our technology $500M
or strengthen our customer value proposition
Q&A