International Flavors & Fragrances Inc. (IFF) Earnings Call Transcript & Summary

Good afternoon, everyone. We're excited to welcome International Flavors & Fragrances back to CAGNY, especially Chief Financial Officer, Michael DeVeau, who is representing his team that includes CEO, Erik Fyrwald, who's celebrating his daughter's wedding and several business unit heads who are here with us today. We're very lucky to have them. Please join me in thanking IFF for sponsoring dinner tonight, which looks absolutely spectacular. For decades, IFF's products and systems have added critical value to many of the presenters here this week and many consumer companies all around the world. In 1 year on the job, Michael and his team have taken equally critical steps to rejuvenate the shareholder value machine. They've repaired the balance sheet and executed a disciplined capital allocation strategy, including portfolio optimization through divestitures. More importantly, they're driving productivity by implementing a new operating model and key process transformation proven principles that are already working for IFF. Michael, welcome. Thank you, and take it away.

Great. Thank you, John, and thank you, CAGNY, for having us again. I appreciate the warm introduction. Before we begin, I do want to extend the invitation to dinner tonight. It's -- I think it's been 3 years or 4 years since we actually hosted a dinner here. It's an awesome time for us because you hear us speak about certain things, but we actually bring it to life later on. So if you can make it, it would be fantastic to have everybody join. Maybe just very, very quickly covering the cautionary statement, and I'll go quick, the non-GAAP reconciliation -- a reconciliation of our non-GAAP measures to our GAAP measures can be found on our website. So if you have any interest or questions, please look there. Really excited to tell the IFF journey story of where we are today versus where we were a couple of years ago. I did bring some friends with me today. So maybe just quick formal introductions. Yuvraj Arora leads our Taste division. Leticia Gonçalves leads our Health & Biosciences division and Ana Paula Mendonça leads our Scent division and Michael Bender on the end who leads Investor Relations for us. And so I'm going to go pretty quickly, and then I'm going to turn it over to them because they're the main part of it of the story. But I do want to start for people that are newer to the IFF story or want to get a refresher to it, really want to leave a couple of key points. One, we are a strong and highly diversified business. And so when you think about our industry, it is attractive. There's high barriers to entry, steady growth, good margins overall. The value proposition of our story is really strong. We represent 1% to 4% to 5% of the cost of a product, but we're 50% of the reason why consumers purchase a product. They like the taste or smell, right? That's the reason why they're buying. We're in the business of what I consider as essentials, right? So in an environment where there's a lot of volatility, diversification matters. And so if you look at the bottom of the chart, you could see four divisions, Food Ingredients, Taste, Health & Biosciences. We're going to focus on the three today, but it's pretty balanced across the board. By market, you could see it's about 50% developed markets, 50% emerging markets, different growth dynamics that the team is going to touch on, but an important factor when we think about the overall diversification. And then all of you here have been here all week. So there's a lot of multinational CPG companies. A lot of them are big customers today. That's about 1/3 of our business, but we have 2/3 of our business that are midsized, local, regional, smaller players and private label. Really good when you think about the growth dynamic, right? And so from a diversification aspect, very, very strong. Strategic progress. We've been on a little bit of a journey. We went through an acquisition phase, a little bit of a divestiture phase. And what I really like -- let's anchor back the last 2 years, 2 or 3 years. And we've had a lot of great strategic progress overall. There's a lot on the slide, so I'm not going to cover it, but there's three to me that stand out. And I think actually John did a very good job at summarizing it. First, it's really about what we did to strengthen the business. And I'm going to go through this in a minute, but it's how do we think about the reinvestment aspects, and OpEx and CapEx to get us to be a long-term profitable growth, sustainable platform. We've also changed a little bit of the operating model. So these individuals actually have full accountability, everything from sales to EBITDA to cash flow. So they have end-to-end accountability, which is super important when we think about the execution dynamic. We've also had a lot of work on portfolio optimization. We've divested about 11 companies -- 11 businesses in the last couple of years and with the use of those proceeds, improved our capital structure to what I'd say is where it is today and hopefully is trending lower over time. But more exciting, as I joined a year ago in this role, specifically, the renewed focus on returns, cash flow generation, super important for me because it feels like it's bringing me back to days where this is about disciplined choice, right? The more choice we make, the better return philosophy that we have, the better the business will become longer term over time. Let me quickly unpack, and I realize there's a lot on each one of these slides. So I broke it up in operational expenses, capital expenditures over the last couple of years. So going back from 2024 to 2026, you'll see we're spending about $150 million in operational expenses of reinvestment in the business. That's big for us. We haven't done that in many, many years. And that's really around innovation, R&D and commercial capabilities. Again, you're going to hear that in more. This is all supported by a culture of productivity. And so a lot of this is being driven by a lot of self-efficiencies that we're driving within COGS and SG&A to making sure we're funding this, not only to support the reinvestment aspect, but keep to the bottom line element to it. At the same time, over the same period, we've increased our CapEx spend. And so you could see '24 is 4%, '25 is 5.5%, '26 it should be around 6%. This is really around capacity expansion. Leticia is going to explain some of that when she goes through her side from the health and bioscience of it, but also network optimization and digital transformation to bring IFF to the next stage as we think about profitable growth. We did all that over that same period of time and through 2026, midpoint of our guidance range while delivering 4% top line, 10% EBITDA growth. That's an algorithmic view of our business. We should be in these ranges as we think about our go-forward basis when we think about these three core businesses. And so Taste, Scent, H&B not only driving bottom line performance, but also driving the top line piece to it. Food Ingredients was another big piece of the margin story. And so since 2023, they've actually expanded margins about 500 basis points to just shy of 14% when we finished 2025 overall. It's about volume growth, volume leverage. So growth is super important in our business. As we grow our business through those reinvestments, the incremental margins are between 30% and 35% EBITDA margin. So there's nice leverage in there. At the same time, supporting that is really around the strong productivity effort that we're trying to drive consistently. Over that same period of time, we've also looked at the portfolio and we've optimized it up in terms of higher value, higher return, higher growth, higher-margin businesses. And so just as a point of reference, divested about 11 businesses really to sharpen the strategic focus, simplify the portfolio overall. But if you look back at the businesses we've divested, the average gross margin of those businesses are about 29% versus our year-end 2025 average about 36%. And so we're really, again, thinking about upscaling our portfolio to higher gross margin businesses over time. Using the proceeds, which is about $6 billion of proceeds related to these 11 divestitures allowed us to address our capital structure. And so when you think about the capital structure, today, we're in a much stronger, much flexible balance sheet than where we were just 2 years ago. And so you can see here, we were at 4.5x in 2023. And then through the divestitures and the improvement in operational performance, we drove about 190 basis points improvement in our net debt to credit adjusted EBITDA to about 2.6x. And again, hopefully trending lower over time. At the same time, we've authorized the share buyback program first time in 6 years, 7 years that we actually had authorization to do a share buyback of a $500 million authorization. It is a dilution plus model. So at minimum, we're looking to offset dilution. But at the intrinsic value of the business is -- or the share price is not meeting the intrinsic value, we will purchase more because we think there's upside and good return there. Go-forward strategy, and then I'll turn it over to the businesses. If anything, I'll leave you with winning with a focus. It's about winning in the right markets with the right customers. It's about being done through innovation. So the more we talk about innovation, the more we bring innovation to customers, the more we'll win in the business. Targeting high-return opportunities, bigger, bolder bets with better return profiles will drive, obviously, top line growth, but also a margin premium as we continue to go. And then we're going to continue to maximize the portfolio towards that high-value businesses. And so if the businesses are good and they're strong margins, we're going to make sure we invest behind them to get this proportional growth. And if there's areas that they're fixed -- that they're underperforming, we're going to try to fix it. And if we can't fix it, we will exit it. And so this is going to be all supported by what we say is people, process and digital transformation overall. And so maybe I'll pause there, and I'll introduce Yuvi to take us through the Taste side.

Thank you, Mike. Good afternoon, everybody. It's a pleasure to be here with all of you today. My name is Yuvraj. I have the privilege of leading our Taste division at IFF. My background is actually in CPG, and I've spent the bulk of my career with the Kellogg Company with roles in marketing and general management around the world. When I joined IFF a little less than 3 years back, I actually joined as the President of our Nourish division, which was the combination of our Taste and Food Ingredients businesses. In 2024, I led the separation into two separate externally reported segments as is today, Taste and Food Ingredients. And since then, I've taken over the leadership of the Taste business, a business that I've increasingly fallen in love with. And I say this for three reasons. First is flavors are embedded in consumers' daily lives through all the products in food and beverages that they consume throughout the day around the world. Secondly, flavors are critical, the primary driver of consumer preference and liking disproportionate to the physical presence they actually have in the product, which is a great value proposition for us. And thirdly, we have a long-term structural tailwind as our customers innovate and renovate to meet evolving consumer needs, which is great for our business. So we take a look at a snapshot of our business. First of all, we operate in a segment that is a great combination of scale and growth. So flavors market is estimated at $16 billion to $17 billion, growing 3% to 4%, which is again a great market to play in. Taste at IFF delivered $2.5 billion in net sales last year in 2025 with a 19% EBITDA margin. I must say here that we actually delivered market-leading growth of 4% top line organic and 10% EBITDA sales growth. We have a global presence with our R&D, application and manufacturing sites around the world, catering to a large number of customers across diverse categories. Mike already alluded to it. We have an amazingly diversified business across any vector, food and beverage categories, geographies when you take developed or developing markets or customer size, large -- from large multinationals to small and emerging brands to actually small players in emerging markets. It's a balance that we are proud of, and we strive hard to maintain and strengthen as we go forward. So where does IFF Taste stand out? First of all, we have leading positions, #1 or strong #2 positions in critical markets like India, Indonesia and the U.S. Second, we believe we have a leadership position in modulation, which is a critical technology platform, and I'll talk a little bit more about it in a minute. We have been using AI for a while now. We are strengthening our efforts there, not only in flavor development where it has a great application, but in things like concept development, where we can help reduce our customers' innovation development time lines and sometimes by eliminating market research for them. We have a distinct go-to-market model called Tastepoint, especially in North America to meet the needs of smaller tier and emerging customers and brands. So these are some things that we feel are competitive advantage for us. Market and consumer trends. Actually, I'm not going to spend too much time on this because over the past 3 days, every company has spoken about exactly the same trends. In fact, all those companies happen to be our customers, and we thank them for their business and partnership. I'll just take a couple of examples here, particularly in the health and wellness area. One is GLP-1. I know there's been a lot of talk about it. We believe that GLP-1 is and will be the most powerful force impacting food and beverage consumption, not only in the U.S. but around the world. We have invested a lot in this area in terms of consumer and sensorial studies and work. And we have teams across our business units, Health & Biosciences, Food Ingredients and Taste, co-creating concepts and co-creating products with our customers to meet the needs of these consumers. A second example, there is a revolution happening in the beverage category. This one, particularly skewed to North America, but you can see signs of it elsewhere as well. We've all seen alcoholic beverages are on a decline and beverage consumption is shifting towards different occasions and need states. On an average, an American has 57 beverage moments in a week. It's a giant market. And these occasions are shifting to more functional benefits like hydration, energy, protein and increasingly gut health. So we are pivoting in that direction as well. I'm going to take this opportunity to invite you all to the food and beverage booth later at dinner today, where you can interact with the team and go deeper into these two specific areas. Now how we address these needs and evolving consumer needs, whether it's from a consumer standpoint or from a regulatory standpoint is through our innovation programs. We have two kinds of innovation platforms, the 6 that you see on the right-hand side, 3 Re-Master programs around critical flavor tonalities, so citrus, vanilla and meat. Citrus, as you can imagine, a very, very important flavor tonality in beverages. Vanilla is a foundational flavor profile, particularly relevant in dairy. And then meat, very important for soups, bouillons and noodles in Asia and Africa, which is a large segment over there. So we have specific programs aimed to develop solutions and further taste profiles in these areas. And then we have our Re-Imagine programs, Re-Imagine delivery, which helps us meet the needs of our customers in different applications and processes. Re-Imagine Origins, which houses our program around clean label as well as critical commodity replacers and extenders like cocoa. But the flagship program that we have is under Re-Imagine Wellness, and that's around modulation. So what is modulation? Modulation is basically we have a set of tools, technologies and solutions that help maintain and sometimes even strengthen the taste profile even as you reduce things like sodium salt or fat in a food or beverage or as you add things like protein, fiber and whole grain. The good news for our business is that the good stuff tastes bad and the bad stuff tastes good. So this is a great tailwind for our business. And modulation as a technology is now a sizable part of our business and has grown double digits for the last 5 years and in 2025. So this is an area where we continue to invest in future technologies to help our customers, which brings me to my last chart around how will we continue driving value creation for taste at IFF. I'm a big believer in disproportionate focus behind areas that offer high growth potential or areas where we might be underdeveloped or underleveraged. So across the vectors that you see on the chart, we have made those choices to pivot us forward. In terms of geography, we have identified 6 geography clusters, which is U.S. and a combination of high-growth markets, which will drive more than 2/3 of our growth going forward, over-indexed growth from these markets. I'll just take an example of Africa. While everybody talks about China and India, and they are very, very important, Africa is the next frontier. A 1/4 of the world's population is going to reside in Africa by 2050. It's the single largest, youngest population base. The average age of an African is 19 in that continent. The per capita consumption is on the rise, urbanization, middle class. So there's an explosion happening in processed foods and food and beverage categories over there. We are underdeveloped in this continent, and we are making investments and efforts to increase -- to get to our fair share and beyond there. In terms of categories, again, we've got a widespread spectrum of categories, but we believe there are a few specific ones that will drive disproportionate growth. Lifestyle or functional beverages is perhaps the most important of them. Dairy, in particular, yogurt and dairy drinks with protein are going to be a very, very important area. And then meat tonalities in soups, bouillons and noodles for the emerging market population growth. In terms of focus on innovation, I already talked about modulation. That is our primary focus area in terms of innovation. And then lastly, in terms of customer base, we've again identified three geographic channel clusters that will drive disproportionate growth. The first is distribution in Asia with a focus on getting to Tier 2 -- penetrating Tier 2 and Tier 3 towns in markets like India, Indonesia and China. These are the towns that are actually driving the growth for these markets. I often joke that Shanghai is no longer an emerging market. Shanghai acts like a developed market. So it's a Tier 2 and Tier 3 towns that are the most important there. Second, food service in North America, increasing on out-of-the-home consumption. You heard multiple companies talk about that. And third, private label, particularly in Europe and increasingly in North America. We believe that the choices that we have made along with the capabilities that we've already demonstrated and we are investing behind will help us continue driving market-leading growth and help us meet our financial goals of midterm -- mid-single-digit top line growth and high single-digit EBITDA growth. So in summary, we operate in a great, healthy, attractive, sizable, scalable segment. We have demonstrated market-leading growth and our commercial pipeline is strong. And we are investing in the right strategic areas that can help continue driving growth and creating value for IFF Taste. Thank you. And I'm going to hand over to Leticia, the President of our Health & Biosciences division.

Thank you, Yuvi. So it's a pleasure to be here with you today. As I was already introduced, I lead our Health & Biosciences business for IFF. Joined the company almost a year ago. I'll be celebrating my first year in a couple of weeks. Really, really excited about the opportunities that we have in front of us to really deliver an amazing business and drive science into innovation in the market. Our business is really a crucial engine behind how IFF deliver value through bio innovations every day. We harness science to shape life and well-being through bioinnovation across five unique and distinct segments: Food Biosciences, Human Health, Animal Nutrition & Health, Grain Processing and Home & Personal Care. What I love about this business, all those five segments have growth opportunities, and they are very diversified. Not only that, our products touch billions of consumers' experiences every day. 1 out of 3 probiotic supplements contains IFF probiotics. 1 out of 3 yogurts globally contain IFF cultures. 50% of cold laundry wash products contain IFF enzymes, just to name a few. Our Biosciences for impact is translating to a robust and profitable business platform that is here not only to drive scale, but also scope. Let's talk a little bit about it. We serve a $20 billion market that is growing 2.5% per year. Even though 2.5% seems small, in fact, it's growing. It's growing even bigger in increasing the target addressable market that I'm going to talk in a few minutes. We operate at scale and scope. We just finished a very strong 2025 with $2.3 billion in sales and 26% EBITDA margin. We have over 7,000 customers, 4,000 employees and 38 sites that cross over R&D applications and manufacturing. And we have a very balanced exposure with a good mix of product portfolio, end market segments and global footprint. Most of our business is in Europe and North America. But good news, we are growing twice as fast in the emerging markets, especially Asia and LatAm. What makes us special? What really differentiates IFF Health & Bioscience? What makes us win in those categories? A couple of things. First is our world-class biosciences capability from discovery to a scale innovation engine. We are not just inventing new things, we are innovating at scale with partners in the market. We are category leaders being #1 or #2 in probiotics, cultures and enzymes. And we compete with a full system approach from our broad portfolio, our deep partnerships, our technical expertise and our leading talent that really bridge science to co-innovating with customers and partners to differentiate solutions in the market. I've been with many customers in my first year, and it's amazing what I hear from our own customers saying, "We love your people. We love your science, and we love co-innovating with you." That's pretty powerful. These are all relevant advantages when consumers are changing fast. I'm going to go quickly here because you already heard this through the last few days, and Yuvi already touched some of this, too. But there are three specific trends that are helping shape our growth strategy for Health & Biosciences. One, health and well-being amplified. Consumers are prioritizing healthy living from eating less sugar, eating more proteins, taking more probiotics for gut health and that all being now amplified through GLP-1 users as well. Biorevolution across the value chain from Regen Ag on the farm to bringing bio-ingredients and biomaterials through many consumer products. And the third one is all of that is great. But given the economic uncertainties, consumers and customers are looking to affordability, supply chain resilience and performance altogether. So there is no one that is more important than the other. All three matter, and we need to bring all of them without compromise. How do we convert those trends into focused innovation with impact? That gets into our innovation platforms. Our innovation platforms drive measurable consumer value and customer differentiation. We invest $220 million per year in R&D. That's roughly 9% of our annual turnover. And 35% of our revenue comes from new product launches in the last 5 years. That's pretty powerful. A couple of examples. We have a great innovation platform around enzymes for cold and quick wash with superior fabric cleaning and care. Oh my gosh, if we can get all of that, that's amazing. Safer and better detergents, right? They can be quick wash, cold wash and superior clean and care in our fabrics. The other one is how we're extending feed enzymes from chicken and pigs into cows. And imagine how many cows are in the world to feed. So that's a great opportunity. Better solutions for metabolic, immunity and digestive health in bringing a comprehensive approach to really address all those health needs and higher yield in our biofuel production. With the huge trend for more biofuels, we are helping the biofuel producers to really increase yield in their production. Those are some examples, but something that really gets me excited every day since I joined IFF, that's the most exciting platform that we have in innovation, DEB. Design Enzymatic Biomaterials is a first to the world high-performing biodegradable material coming from simple sugars from nature. That allow us to expand the TAM to another $60 billion bio-based market opportunity. Every 5% market share translates into a $3 billion revenue opportunity for DEB. Good news, we are already commercial with a couple of products in home and personal care, but that's just the beginning. We are now expanding to many new applications into multiple adjacent markets that are today in specialty polymers. And we are not doing this alone. As we are bringing the science and the applications, we are already doing this with partners like Kemira and BASF to make sure that we can scale faster to the market. I hope all of you will be able to join our dinner tonight because you'll be able to see some of our innovation, including DEB into one of our stations there. Bringing it all together, we are creating long-term value. We are also creating short-term value. And in order to maximize growth and profitability in the next few years, here are four areas of priorities. First, earn the partner of choice with our customers. Win with the big winners in the market, not only the existing one, but new ones that we are going after. We are also revitalizing our North America Health business by expanding our go-to-market capabilities into new e-commerce customers as well as new innovation. We are working to innovate faster and better by shaping bigger bets with existing strategic partners and also using AI to accelerate our ability to innovate from discovery to commercialization. Digital biology is one of the areas that we are innovating AI as an example. We are expanding capacity for both enzymes and cultures to not only capture the market demand today, but to start accelerating to the future. And we are also driving an end-to-end supply chain optimization to balance cost and quality and optimize margin in our supply chain. And all of that only possible because we do have an amazing team. Our one high-performing growth-minded team is what's driving the biggest difference in our business. I'm really passionate about our people. In summary, we are committed to grow faster than the market and improve our margins, targeting single -- low single -- mid-single-digit growth in our sales and high single-digit growth in our EBITDA in the next few years. And I truly believe with our science, our people and deep partnership with our customers, we'll be able to achieve that. Thank you. Now with that, Ana?

Thank you, Leticia. Go to the next slide. Hi, everyone. I'm Ana Mendonca, as Mike introduced me before, and I have the privilege of leading the Scent division for the past 2 years. But I've been part of IFF for 30 years now. Yes, you heard right, 30 years. It's a great journey. And we are -- I really -- I'm very passionate to this business as I am today, as I was 30 years ago. As we are delivering in our purpose every day in the Scent business with our leading scientists and our leading perfumers to help make the life of consumers better every day in creating joyful moments. Scent is a core part of IFF's identity. It's a strong driver of growth and profitability and is a resilient business, and we've been delivering 22 consecutive quarters of growth even through the major transformations that Mike mentioned earlier. As you can see on the image, scent is present in consumers' life 24 hours a day, 365 days per year and is a powerful driver of emotion and premiumization. I was at ACI, the American Cleaning Summit 2 weeks ago in Orlando as well, meeting with our main customers and the energizing piece of the conversation is that our customers are prioritizing innovation and product superiority to drive volume growth. And Mike mentioned this before, is a small message, but a powerful one that fragrance is a small share of the formulation cost of the end product and it has a disproportional share on choice, brand equity and value creation. Now going to the business overview. The Scent business achieved $2.5 billion in sales in 2025 with a 21% EBITDA margin. We have a robust, broad and expanding and growing business. And if we look at the breakdown by business, we have a healthy and resilient portfolio. 1 out of 4 consumer products contains an IFF fragrance. Nearly 1 out of 3 perfumes sold in the world was created by IFF. And we have the largest fragrance portfolio in ingredients across synthetics and naturals. When you look at the breakdown by geography, despite our strong U.S. roots and heritage, you can see more than 80% of our revenue is generated outside North America, and we have a strong position in emerging markets in Latin America, in Greater Asia. And as you can see, our largest revenue is coming from Europe, Middle East and Africa. And if you look at the breakdown by customer, at the end of the day, this business -- fragrance is a business driven by customer intimacy. And we have this incredible culture at IFF of customer obsession and customer centricity. And our global footprint with the creative centers, the application centers and the R&D centers really allows us to serve customers at scale as well as delivering locally relevant fragrances, which is really key for growth. So where do we stand out? As I said, we have consistently grown ahead of the market. And we are market leaders in prestige Fine Fragrance based on our legacy, but I will tell later, we have identified new growing geographies that have helped us deliver tremendous growth in Fine Fragrance. I don't know if you know, but IFF invented the fragrance encapsulation nearly 2 decades ago based on our brilliant science working with our perfumers identifying an unmet consumer need. And that has really been very instrumental to our leadership position in Fabric Care. And in the last few years, scent boosters is a new format that is driving a lot of value in the fabrics category, and we have a very strong position there. IFF is the undisputable leader in naturals. We acquired LMR, stands for Laboratoire Monique Remy in Grasse back in the 2000s and is a full ecosystem of solutions in naturals. We have scientists, we have perfumers. We have agronomists, we have creators, all focusing on developing a really strong pipeline of natural ingredients. We hold positions, as I mentioned earlier, in Latin America, leading positions in Latin America and in India. And I agree with you, there are geographies that are also maybe outpacing India, but for the scent business, it's a huge growth market. We count on penetration of new categories for the Indian consumers, and that's going to grow, and we can capture value on that. And those are two of the most attractive growth markets between Fine Fragrance and our Consumer Fragrances as well. And we have, over the past 2 years, unlocked a strong and exciting commercial and innovation pipeline. And the focus now is conversion into sales. And our teams are really, really focused on those outcomes. AI for Scent is not really changing dramatically the model, is basically becoming an enabler for helping efficiencies. I give you an example. Our perfumers spend time on reformulation, for example, for regulatory reasons, tox, we call tox modification, cost modifications, and we have a really good foundational piece there that can help our perfumers save time on those, let's say, mechanical activities and focus on growing the business and unlocking value. And of course, it's going to help us on our productivity goals, bringing efficiencies and augmenting creativity as we're always looking for unexpected combinations of ingredients to bring new solutions and AI can help us there as well. It's a journey, and we're at the beginning of that journey. And I have to say, as Leticia said as well, that behind these achievements, I have an exceptional talented, passionate team of perfumers. We have some of the leading master perfumers of this industry with, I think, this being one of our competitive advantages. Perfumers make a difference in the scent business. They really bring the science and creativity together to unlock growth. So we talked about market trends. I think for me here, it's a mix of trends that are challenging the scent industry and trends that are really creating amazing new opportunities. And the industry is changing rapidly and our customers' needs are changing rapidly as well. We all talked about the shift to clean label, sustainable solutions, and that creates tremendous regulatory pressures in the scent business from a fragrance ingredients catalog perspective. So we're working, of course, fiercely on that. On the other hand, new generations, Gen Z and the new generations coming, they are driving the needs for personalization on fragrance and new rituals. If any of you have kids between 12 and 16, I think you know what I'm talking about. They're going crazy on fragrances. They are layering fragrances. They are creating new rituals. They are buying online. They are really changing dramatically the consumer behavior, especially on the fine fragrance and beauty categories. And then there is a growing role for scent in health and well-being, and that's an opportunity that we are leveraging. I'll talk a bit in a second. So the IFF ambition on Scent is to lead the transformation of the scent industry given all the rapid trends we see happening. I want to spend more time here. Our full R&D transformation started 18 months ago. We virtually aligned the R&D priorities with our customer needs. We super, super simplified how we work upstream and downstream in science. And we increased our agility by leveraging the in-house capabilities that we have, while we have selectively formed external partnerships via open innovation. That's a great new mindset in the transformation. We invested in three innovation platforms you see here. The first one is Science of Perfumery. Simply said, we have accelerated the building of a differentiated molecule portfolio between synthetic molecules and naturals molecules. The key here for IFF on that transformation is biotechnology. And that is where we are investing both on transforming existing ingredients or creating new molecules using and leveraging biotechnology. The second platform is art of performance, and that's when we take those ingredients and apply to the formulation of our customers and deliver performance. I have one very practical example that if you join us tonight, you're going to be able to experience so don't miss it, is a new solution that we brought to the market called ENVIROCAP. Basically, it's a sustainable ECHA-compliant encapsulation technology. And what differentiated us here is that we used biopolymers working in great collaboration with Leticia and her scientists on H&B to be able to deliver an encapsulation system that is regulatory compliant and is delivering perceivable superior freshness, which is a major requirement for our customers. And that continues to help us reinforcing our Fabric Care leadership position. And the third platform is what we call Science of Wellness. In fact, IFF pioneered in science of wellness many, many years investing in this space. There is a lot of new consumer needs, and we are designing there a portfolio of scent technologies to support emotional, physical and mental well-being. And again, if you join us tonight, if you're sleep deprived for whatever reasons, we have a scent for that. Come and see us. It will be an interesting moment. So those capabilities are actually the enablers that we need for our perfumers to win more than our fair share. And I'm excited about what we have achieved since we started the R&D transformation and very focused investment on those platforms, having ENVIROCAP being the case, let's say, the proof point that we are back winning with technology in Fabric Care. So as I close, for me, it really comes down to clear priorities to drive growth and margin improvement in the Scent business. I'll start with Fine Fragrance. As I said, we have delivered outstanding performance in Fine Fragrance, double-digit growth every quarter last year, amazing performance from the team. And I wanted to say how important the bets are for the Scent business. 5 years ago, we identified Middle East as a potential growth opportunity for Fine Fragrance. And then we invested in our customer relationships, understanding the consumer from the younger generation to the mainstream, and we're able to deliver incredible, fantastic strong growth coming from the Middle East based on the Arabic perfumery phenomenon. And now they also export to countries as Brazil and to the U.S., and that has been one of the growth engines for Fine Fragrance. So we don't stop there. We are constantly identifying those opportunities. So new geographies, new markets, will be the future growth of Fine Fragrance. In Consumer Fragrances, our growth has been driven by fragrance-led innovation, and probably you heard that from some of our main customers as well. That's where the focus is on the co-creation model, engagement model that we have with the FMCGs. And as I said earlier, ENVIROCAP is the proof point. But we also have opportunities to increase our market share in higher-margin personal care categories. We've gained -- we newly gained access to more opportunities in personal care with globals and regionals, and we have built a strong pipeline. Again, conversion to sales, it's where we're focusing on. And in Fragrance Ingredients, I'll be honest with you, we're facing headwinds. The industry is facing headwinds in commodity ingredients. Our strategy has been to move to shift towards high-value specialties with proprietary molecules and continue to invest in naturals. So if you don't remember anything that I said today, but if you remember three things, one is for this business, it is about richer mix via fine fragrance wins, personal care wins, naturals and high-value specialties. It's about faster innovation. And I'm really, as I said, very, very excited about the transformation we have started in R&D, and that is going to be enabled by a simplified, streamlined R&D model. And self-funded productivity, I didn't talk so much about productivity, but that's where we need to focus to be able to fuel our growth and deliver the efficiencies. We have a strong track record in the Scent business, as I said, 22 consecutive quarters of growth. I'm proud of that. And I'm confident on the outlook that we are sharing with you to achieve the target of mid-single-digit sales growth and high single-digit EBITDA growth over time. I'm very confident we made the right choices over the past 2 years. We have the right teams. We have a strong creative and commercial organization very much linked to our R&D organization, and we started rebuilding the momentum again. So thank you for listening to Scent. Mike, what do we do? Back to you or we wrap up?

Yes, I think we can wrap.

Yes, I think it's about all the time we have. We're going to take it to the breakout room. Please attend the dinner tonight. It looks spectacular. And please join me in thanking IFF once again for their great presentation and sponsoring a dinner.