International Flavors & Fragrances (IFF) risk factors, FY2024 10-K

Risks Related to Our Business and Industry

1. 01We 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 business and our credit ratings
2. 02If we are unable to successfully execute our strategic transformation, including our portfolio optimization, it may have a material adverse effect on our business, results of operations and financial condition
3. 03Regulatory, consumer and economic trends may result in significant costs or adversely affect demand for our products which may have a negative impact on our operating results and future growth
4. 04Our results of operations may be negatively impacted by the outcome of uncertainties related to legal claims, disputes, investigations and litigation, including the ongoing antitrust and competition investigations and related class action lawsuits
5. 05Our insurance may not be adequate to protect us from potential material expenses related to pending and future claims and our current levels of insurance may not be available in the future at commercially reasonable prices. Any of these factors could adversely affect our profitability and results of operations
6. 06amount 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
7. 07Inflationary 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 result in uncertainties in the long term
8. 08Our performance may be adversely impacted if we are not successful in managing our inventory and/or working capital balances
9. 09Our business is highly competitive, and if we are unable to compete effectively our sales and results of operations will suffer
10. 10A 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
11. 11We may not successfully develop and introduce new products that meet our customers’ needs, which may adversely affect our results of operations
12. 12A significant data breach or other disruption to our information technology systems could disrupt our operations, result in the loss of confidential information or personal data, and adversely impact our reputation, productivity, business or results of operations
13. 13We 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
14. 14We have made investments in and continue to expand our business into emerging markets, which exposes us to certain risks
15. 15The impact of currency fluctuation or devaluation in the international markets in which we operate may negatively affect our results of operations
16. 16International economic, political, legal, compliance and business factors could negatively affect our financial statements, operations and growth
17. 17Our customers, consumers and shareholders are becoming increasingly sensitive to environmental-related and other long-term sustainability issues. At the same time, we face increasing regulatory reporting requirements related to sustainability topics
18. 18If 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 opportunities
19. 19Our ability to declare and pay dividends is subject to certain considerations
20. 20Any reduction in the amount of dividends we pay to shareholders could have an adverse effect on the trading price of our common stock
21. 21employees 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
22. 22If we are unable to successfully market to our expanded and diverse customer base, our operating results and future growth may be adversely affected
23. 23A significant portion of our assets consists of long-lived assets, including tangible assets such as our manufacturing facilities, and intangible assets, including goodwill and customer relationships
24. 24Our funding obligations for our pension and postretirement plans could adversely affect our earnings and cash flows

Risks Related to Legal and Regulatory Considerations

1. 25If we are unable to comply with regulatory requirements and industry standards, including those regarding product safety, quality, efficacy and environmental impact, we could incur significant costs and suffer reputational harm which could adversely affect results of operations
2. 26Defects, 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
3. 27Failure to comply with environmental protection laws may cause us to close, relocate or operate one or more of our plants at reduced production levels, and expose us to civil or criminal liability, which could adversely affect our operating results and future growth
4. 28We could be adversely affected by violations, by us or our counterparties, of U.S. or foreign anti-bribery and anti-corruption laws and regulations, applicable sanctions or competition laws and regulations in the jurisdictions in which we operate or ethical business practices and related laws and regulations
5. 29Our ability to compete effectively depends on our ability to protect our intellectual property rights
6. 30making, using or selling our products or processes. The ongoing trend among our customers towards more transparent labeling could further diminish our ability to effectively protect our products
7. 31Changes in our tax rates, the adoption of new U.S. or international tax legislation, or changes in existing tax laws could expose us to additional tax liabilities that may affect our future results
8. 32The N&B Transaction could result in significant tax liability, and we may be obligated to indemnify DuPont for any such tax liability imposed on DuPont
9. 33If we fail to comply with data protection laws in the U.S. and abroad, we may be subject to fines, penalties and other costs