• Net Sales (Q4 2024): $1.8 billion, down 6% versus prior year.
• Gross Profit (Q4 2024): Increased 12%, with margins up 420 basis points to 25%.
• Adjusted Operating Income (Q4 2024): $248 million, up 22% versus prior year.
• Net Sales Volume Growth (Q4 2024): Organic growth of 4% when adjusted for the sale of South Korea business.
• Gross Profit (Full Year 2024): Reached record levels of $1.8 billion with a margin of 24%, up 270 basis points compared to 2023.
• Cash Generated from Operations (2024): $1.4 billion.
• Capital Expenditures (2024): $295 million.
• Share Repurchases (2024): Over $200 million.
• Adjusted EPS (2024): Increase of $1.23 per share.
• 2025 Guidance - Net Sales: Expected to be up low single digits.
• 2025 Guidance - Adjusted EPS: Expected to be in the range of $10.75 to $11.55.
• 2025 Guidance - Cash from Operations: Expected to be in the range of $800 million to $950 million.

• Warning! GuruFocus has detected 4 Warning Signs with INGR.

Release Date: February 04, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Ingredion Inc (NYSE:INGR) achieved significant double-digit adjusted EPS growth for the fourth quarter, driven by strong sales volume growth in Texture and Healthful Solutions.
• The company successfully renewed multi-year contracts in the US/Canada, enabling margin recovery and significant operating income growth.
• Ingredion Inc (NYSE:INGR) exceeded its first-year Cost2Compete program savings target by more than 30%, with plans to meet or exceed a $50 million target by the end of 2025.
• The company announced $100 million in investments to expand capabilities for delivering texture innovations and improve the Indianapolis plant's sustainability.
• Ingredion Inc (NYSE:INGR) was recognized by the Wall Street Journal as one of the 250 Best Managed Companies, highlighting achievements in customer satisfaction, employee engagement, innovation, and financial strength.

Negative Points

• Net sales for the fourth quarter were down 6% compared to the prior year, impacted by lower price mix and foreign exchange impacts.
• The Food and Industrial Ingredients LatAm segment experienced a 4% decline in net sales volumes due to softer sweetener sales in the Mexican beverage market.
• Ingredion Inc (NYSE:INGR) anticipates flat to slightly higher corn costs in 2025, which may require additional investment in working capital.
• The company's 2025 EPS guidance range is wide, reflecting uncertainties such as foreign exchange rates and potential changes in corn costs.
• Ingredion Inc (NYSE:INGR) faces potential headwinds from currency fluctuations, particularly in Brazil and Mexico, which could impact financial performance.

Q & A Highlights

Q: Can you explain the wide range in the 2025 EPS guidance and the factors that could influence the low and high ends? A: James Gray, CFO, explained that the wide range is due to uncertainties early in the year, such as foreign exchange rates and crop outcomes. The low end could be affected by currency weaknesses in regions like Brazil and Europe, while the high end could benefit from greater-than-expected volume growth and customer reformulations.

Q: How does the $100 million CapEx investment in Indiana fit into your capital allocation strategy, and will it affect acquisition plans? A: James Gray, CFO, stated that the investment is part of a broader strategy to enhance organic growth and operational efficiency. The strong balance sheet allows for both this investment and potential acquisitions, without impacting share repurchase plans.

Q: What gives you confidence in the mid-single-digit volume growth expectation for 2025? A: James Gray, CFO, clarified that the growth is primarily expected in the Texture and Healthful Solutions segment, with less price mix impact compared to 2024. The Food and Industrial Ingredients segments have lower volume targets.

Q: Can you provide more details on the Cost2Compete program and its impact in 2025? A: James Zallie, CEO, highlighted that the program exceeded its first-year savings target by over 30%. Key levers included organizational streamlining and facility closures. In 2025, savings will focus on optimizing capacity utilization and modernizing operations.

Q: How are you managing potential risks from tariffs, trade, and food regulations? A: James Zallie, CEO, noted that Ingredion is monitoring potential changes and has local manufacturing in key regions to mitigate risks. The company is also conducting scenario planning to adjust supply chain operations if needed.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.