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International Flavors & Fragrances Inc. (IFF) reported its first quarter 2011 financial results, with revenue of $714 million representing a 9% increase over the first quarter 2010. "We are pleased with our excellent start to 2011, especially given that we are comparing to a very strong year-ago performance of double-digit growth," said Doug Tough, IFF chairman and CEO. "Our top-line performance was once again driven by double-digit growth in the emerging markets. In the developed markets, strong demand for our innovative products, such as healthier and more natural offerings, drove high single-digit growth. This strong top-line performance provided operational leverage that when combined with our continued focus on cost discipline drove a double-digit increase in operating profit."
Tough continued, "While our first quarter performance was strong, our initial local currency sales levels have shown some pressure as we enter the second quarter, in light of challenging year-over-year comparisons. Nonetheless, we are optimistic that our performance in the first quarter, coupled with the opportunities we see throughout the remainder of the year, give us the confidence to achieve our long-term targets of 4–6% local currency sales growth, 7–9% percent operating profit growth and 10% plus EPS growth for the full year 2011."
In IFF’s fragrance business unit, local currency sales increased 7% in the first quarter of 2011 against a very strong comparable in the prior year period. Emerging market performance continued to grow by double digits as the company garnered new business wins across all categories. To note, double-digit growth in fine fragrance and beauty care continued for the fifth consecutive quarter, and functional fragrance results maintained with new business wins and performance in home care. Additionally, fragrance ingredients business was buoyed to growth by price initiatives. For this unit, operating profit increased by $13 million to $69 million, including a $5 million expense related to restructuring efforts in Europe in the first quarter 2010.