International Flavors & Fragrances (IFF) Financial History

Moreover, we are not indemnified by Dupont for most tax liabilities related to periods prior to the N&B Transaction.

In connection with the N&B Transaction, IFF, N&B, and Dupont entered into a Tax Matters Agreement, a form of which is attached to IFF’s registration statement on Form S-4 (Registration Number 333-238072) (“TMA”).

In August 2022, the U.S.

In December 2021, the Organisation for Economic Co-operation and Development (“OECD”) released the Pillar Two model rules to reform international corporate taxation that aim to ensure that applicable multinationals (g…

We have and will continue to implement transfer pricing policies among our various operations located in different countries.

We vigilantly protect our intellectual property rights, including trade secrets.

We rely on patents, trademarks, copyrights and trade secrets to protect our intellectual property rights.

In addition, antitrust and competition laws and regulations continue to be actively enforced by competition authorities in the U.S., the European Union and other jurisdictions where we are active.

We could be adversely affected by violations, by us or our counterparties, of U.S.

Failure to comply with these laws and regulations or any future changes to them may result in significant consequences to us, including the need to pause or cease production, close or relocate one or more of our produ…

We may also be exposed to serious adverse health claims related to undetected poor quality of raw materials, internal system failures to adequately reduce or eliminate certain hazards (such as pathogens, allergens, co…

Assumptions used in determining projected benefit obligations and the fair value of plan assets for our pension and other postretirement benefit plans are determined by us in consultation with outside consultants and…

Our customers, consumers and shareholders continue to be sensitive to environmental-related and other long-term sustainability issues.

To the extent any of our businesses do not perform as anticipated and our underlying assumptions and estimates related to their fair value determination are not met, whether due to internal or external factors, the va…

At least annually, we assess goodwill for impairment.

As of December 31, 2025, we had $14.3 billion of intangible assets and goodwill, primarily arising from the acquisitions of Frutarom and N&B.

•the movement for increased unionization and collective labor activity in the U.S.

•changes in environmental, health and safety permits or regulations, such as regulations related to biodiversity or the continued implementation and evolution of the European Union’s REACH regulations and similar regu…

We operate on a global basis, with manufacturing sites, supply arrangements and sales presence in the U.S., Europe, Africa, the Middle East, Latin America, and Greater Asia.

We have significant operations outside the U.S., the results of which are reported in the local currency and then translated into U.S.

At the same time, AI is already changing the way we and our competitors do business by, among other things, accelerating research and development, creating efficiencies, improving supply chain, productivity and other…

We rely on information technology systems, including third-party providers, to support critical business processes such as product development, manufacturing, sales, distribution, financial reporting, regulatory compl…

Trade wars, tariffs, sanctions, geopolitical developments, supply chain disruptions, environmental events, natural disasters, public health or human rights crises, and other events may adversely affect our sourcing of…

Our insurance coverage may be insufficient to protect us from potential material expenses related to pending and future claims and unavailable at reasonable cost in the future.

Our results of operations may be negatively impacted by legal claims, disputes, investigations and litigation, including the ongoing antitrust and competition investigations and related class action lawsuits.

If we are unable to successfully execute our strategic transformation, or enter into or close collaborations, joint ventures, partnerships, acquisitions, or divestitures, it may have a material adverse effect on our b…

These and other consumer and regulatory trends may continue to affect the demand for our products and impact our ability to meet certain productivity levels.

Consumer demand and preferences, as well as regulatory trends may impact demand for our products, which may have a negative effect on our operating results and future growth.

•We could be adversely affected by violations, by us or our counterparties, of U.S.

•We have a substantial amount of indebtedness that could materially adversely affect, among other things, our financial condition, our ability to return capital to our shareholders, needed investments into our busines…

•Trade wars, tariffs, sanctions, geopolitical developments, supply chain disruptions, environmental events, natural disasters, public health and human rights crises, and other events may adversely affect our sourcing…

•If we are unable to successfully execute our strategic transformation, or enter into or close collaborations, joint ventures, partnerships, acquisitions, or divestitures, it may have a material adverse effect on our…

•Consumer demand and preferences, as well as regulatory trends may impact demand for our products, which may have a negative effect on our operating results and future growth.

The completion of the N&B Transaction in 2021 was conditioned upon the receipt by DuPont of an opinion that the transaction generally will qualify as a tax-free reorganization.

ruling or an implemented tax regime violates the state aid restrictions, the tax authorities of the affected European Union member state may be required to collect back taxes for the period of time covered by the ruling.

The European Commission (“EC”) is continuously investigating tax rulings in a number of European Union member states, including with respect to specific multi-national corporations to determine whether such rulings co…

making, using or selling our products or processes.

Lastly, our reputation and our customers’ willingness to purchase our products depend in part on our compliance by our suppliers, distributors, customers or other counterparties with ethical employment practices, such…

Detecting, investigating and resolving actual or alleged violations of the FCPA or other anti-bribery and anti-corruption laws and regulations is expensive, could consume significant time and attention of our senior m…

We operate or may pursue opportunities in some jurisdictions, such as China, India, Brazil, Russia and Africa, that pose potentially elevated risks of fraud or corruption or increased risk of internal control issues.

advantage.

The global nature of our business, our size and employee count, the significance of our international revenue, our focus on emerging markets and presence in regulated industries create various domestic and local regul…

Defects in, misuse of, quality issues with respect to (including products recalls) or inadequate disclosure of risks relating to our products, as well as performance or other issues in our customer relationships, coul…

Defects, quality issues (including product recalls), inadequate disclosure or misuse with respect to the products and capabilities could adversely affect our business, reputation and results of operations.

Our contracts often require us to indemnify our customers for the costs associated with a product non-compliance event, including penalties, costs and settlements arising from litigation, remediation costs or loss of…

Gaps in our operational processes or those of our suppliers or distributors can result in products that do not meet our quality control or industry standards or fail to comply with the relevant regulatory requirements…

As concerns regarding safety, quality and environmental impact become more pressing, we may see new, more restrictive regulations adopted that impact our products in the U.S.

The development, manufacture and sale of our products are subject to various regulatory requirements in each of the countries in which our products are developed, manufactured and sold.

Effective January 1, 2025, our Nourish segment has been restructured into two newly designated operating segments: Taste and Food Ingredients.

As a result of our acquisition of Frutarom and the N&B Transaction, the number of our customers significantly increased and became more diverse.

If we are unable to successfully market to our expanded and diverse customer base, our operating results and future growth may be adversely affected.

Competition for employees can be intense and if we are unable to successfully integrate, motivate and reward our employees, we may not be able to retain them.

employees is critical in, among other things, meeting productivity goals as well as the development of new products and technologies, which is an integral component of our growth strategy.

Attracting, developing, and retaining talented employees is essential to the successful delivery of our products and has become more difficult and costly in the current labor market.

Our success depends on attracting and retaining talented people within our business and our management team.

•restrictions in our credit agreement related to the issuance of dividends, including minimum capital requirements; and

Likewise, from time to time, we conduct divestiture transactions relating to certain of our businesses or assets.

In addition, from time to time, we evaluate acquisition candidates and conduct acquisitions that may strategically fit our business, our growth or productivity objectives.

From time to time, we evaluate and enter into collaborations, joint ventures or partnerships to enhance our research and development efforts, expand our product portfolios and technology, or modify or enter into new d…

If we fail to successfully enter into or close collaborations, joint ventures, partnerships, acquisitions, or divestitures, or successfully manage such transactions, it could adversely affect our business and growth o…

•changes in environmental, health and safety permits or regulations, such as regulations related to biodiversity or the continued implementation and evolution of the European Union’s REACH regulations and similar regu…

Further, there is no assurance that our existing products, variants of our existing products or new products that we make, manufacture, distribute or sell will be accepted or be successful in any particular developing…

As part of our growth strategy, we have increased our presence in emerging markets by expanding our manufacturing presence, sales organization and product offerings in these markets, and we expect to continue to expan…

We have made investments in and continue to expand our business into emerging markets, which exposes us to certain risks.

If we are unable to successfully manage these risks, it may have a material adverse effect on our business, results of operations and financial condition.

Analyses, results or business processes relying on AI may also be deficient, inaccurate, or biased and we may fail to identify in a timely fashion or at all, if or to the extent that is the case.

Additionally, the use of AI may lead to the weakening or loss of intellectual property rights, where AI-generated inventions or creations may not be properly attributed to the rightful inventors, potentially resulting…

The use of AI by us, our employees or any of our third-party partners may result in unauthorized disclosure of personal data, proprietary information and trade secrets, commercially sensitive or confidential informati…

IFF has been increasingly using or considering using AI tools in its operations, research and development and other areas.

We are subject to risks associated with the potential use of AI in our own operations and by third-party partners that we may engage with.

A disruption to our information technology systems could result in the loss of confidential business, customer, supplier or employee information, litigation or fines, and may require substantial investigations, repair…

To address the risks to our information technology systems and the associated costs, we maintain an information security program that includes updating technology and information security policies and controls, cybers…

We rely on information technology systems, including some managed by third-party providers, to conduct business and to support our business processes, including those relating to product formulas, product development,…

Consequently, even when we “win” a project, our ability to generate revenues as a result of these investments is subject to numerous customer, economic and other risks that are outside of our control, including delays…

Our ability to differentiate ourselves and deliver growth largely depends on our ability to successfully develop and introduce new products and product improvements that meet our customers’ needs, and ultimately appea…

We may not successfully develop and introduce new products that meet our customers’ needs, which may adversely affect our results of operations.

In addition, large multi-national customers and increasingly middle market customers continue to utilize “core lists” of suppliers to improve margins and profitability in the flavors and fragrance segments.

During 2024, our 25 largest customers, a majority of which were multi-national consumer products companies, collectively accounted for approximately 33% of our sales in the aggregate.

A significant portion of our sales is generated from a limited number of large multi-national customers, which are currently under competitive pressures that may affect the demand for our products and profitability.

Failing to identify and make capital expenditures to achieve growth opportunities, being unable to make new concepts scalable, or failing to effectively and timely reinvest in our business operations, could result in…

price competition, could result in the loss of sales, reduced pricing and margin pressure and could adversely impact our sales and profitability.

Competition in our business is based, among other things, on innovation, product quality, regulatory compliance, pricing, quality of customer service, the support provided by marketing and application groups, and unde…

As we continue to enter into adjacent markets, such as functional foods, specialty fine ingredients and nutrition products, we may face greater competition-related risks in these markets than with our other businesses.

The markets in which we compete are highly competitive.

We sell certain accounts receivable on a non-recourse basis to unrelated financial institutions under “factoring” agreements, some of which are sponsored by certain customers.

We evaluate our inventory balances of materials based on shelf life, expected sourcing levels, known uses and anticipated demand based on forecasted customer order activity and changes in our product/sales mix.

If we are unable to increase the prices of our products to our customers to offset inflationary cost trends, or if we are unable to achieve cost savings to offset such cost increases, we could fail to meet our cost ex…

Inflationary pressure and price uncertainty may continue in 2025.

Inflationary trends and pricing uncertainty, including in the price of our input costs, such as raw materials, transportation and energy, could adversely affect our business and financial results in the short term and…

If we are not able to successfully mitigate such risks, we could experience disruptions in production or increased costs, which may result in decrease in our gross margin or reduced sales, and have a material adverse…

While we operate research and development, manufacturing and distribution facilities throughout the world, many of these facilities are extremely specialized and certain of our research and development or creative lab…

Similarly, geopolitical developments, such as the US-China relations, escalating tensions between China and Taiwan, the Russia-Ukraine war, the Israel-Hamas war and wider Middle East developments (including disruption…

In addition, the imposition of or changes in customs, tariffs, other trade protection measures (including with respect to China, Canada, Mexico, European Union or other jurisdictions by the U.S.), import or export lic…

As we source many of our raw materials globally, we are subject to additional risks.

Environmental events may affect our facilities, customers or suppliers and the availability, quality and pricing of raw materials.

amount of raw materials that will be used for the geographic region in which we will need these materials or competitively price our products, our margins could be adversely affected.

We use many different raw materials for our business, such as essential oils, extracts and concentrates derived from fruits, vegetables, flowers, woods and other botanicals, animal products, raw fruits, organic chemic…

We, directly or indirectly through our suppliers, are subject to risks, inherent in agriculture, development, manufacturing, distribution or sale on a global scale, including natural disasters, global or local health…

In addition, in light of our product offerings into functional food, nutraceuticals, natural antioxidants or pharmaceutical products, we may also be subject to claims of false or deceptive advertising claims relating…

Antitrust and competition enforcement actions by the U.S.