Ingredion (INGR) Q2 2024 earnings summary

Executive summary

• Second quarter 2024 delivered record adjusted operating income, with adjusted EPS up 24% to $2.87, despite a 9% sales decline due to lower raw material costs and the South Korea business sale.

• Profitability was driven by volume recovery, lower input costs, cost absorption, and operational excellence, supported by productivity and cost control initiatives.

• Net income attributable to Ingredion was $148 million in Q2 2024, down from $163 million in Q2 2023, but YTD net income rose to $364 million, aided by the South Korea sale.

• Strategic capital was deployed for organic growth in texture solutions and increased ownership in PureCircle to 98%.

• Sustainability progress included a 22% reduction in Scope 1 and 2 emissions and 67% sustainable sourcing for Tier one crops.

Financial highlights

• Q2 2024 net sales were $1,878M, down 9% year-over-year; adjusted operating income rose 8% to $270M, while reported operating income declined 4% to $240M.

• Adjusted diluted EPS increased to $2.87 from $2.32 in Q2 2023; reported diluted EPS was $2.22, down from $2.42.

• Year-to-date net sales fell 11% to $3,760M; adjusted operating income YTD was $486M.

• Cash from operations for the first half was $521M; net capital expenditures were $120M; $104M paid in dividends and $66M in share repurchases.

• Net gain on sale of South Korea business was $82M YTD 2024.

Outlook and guidance

• Full-year 2024 net sales expected to be down low single digits, reflecting lower price mix and corn values, but adjusted operating income projected to be up mid-single digits.

• Adjusted EPS guidance for 2024 raised to $9.70–$10.20; reported EPS expected at $10.20–$10.70.

• Cash from operations guidance increased to $800–$950M; capital expenditures planned at $340M.

• Q3 2024 net sales anticipated to be flat, with adjusted operating income up high double digits year-over-year.

• Effective tax rate for 2024 expected at 27%–28% (reported) and 26.5%–27.5% (adjusted).