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Contact:
David Plautz
(414) 347-3706
 
investor.relations@sensient.com


Sensient Technologies Corporation
Reports Results for the Quarter Ended September 30, 2026

MILWAUKEE— October 30, 2026 — Sensient Technologies Corporation (NYSE: SXT), a leading provider of flavors and colors for the food, pharmaceutical, and personal care markets, today reported financial results for the third quarter ended September 30, 2026.

Third Quarter Consolidated Results


 •
Reported revenue increased 10.6% to $455.8 million in the third quarter of 2026 versus last year’s third quarter results of $412.1 million. On a local currency basis(1), revenue increased 10.2%.


•
Reported operating income increased 25.5% to $72.4 million compared to $57.7 million recorded in last year’s third quarter. In the third quarter of 2025, the Company recorded $3.3 million of costs related to its Portfolio Optimization Plan versus no costs recorded in the third quarter of 2026. Local currency adjusted operating income(1) and local currency adjusted EBITDA(1) were up 18.6% and 15.4%, respectively, in the third quarter.


•
Reported earnings per share increased 29.9% to $1.13 in the third quarter of 2026 compared to 87 cents in the third quarter of 2025. Local currency adjusted diluted EPS(1) increased 17.7% in the third quarter.

 “Sensient delivered an exceptional third quarter, with results that reflect the strength of our strategy and unwavering focus on our customers.  As we look ahead, I am encouraged by the momentum across our business, the opportunities in our markets, and the investments we are making to support growth.  I remain very confident about our performance in 2026 and beyond,” said Paul Manning, Sensient’s Chairman, President, and Chief Executive Officer.

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Sensient Technologies Corporation
Page 2
Earnings Release – Quarter Ended September 30, 2026
 
October 30, 2026
 
Third Quarter Group Results

   
Reported
Quarter
    
Local Currency(1)
Quarter
  
Revenue
        
Flavors & Extracts
    
3.5
%
    
3.2
%
Color
    
18.1
%
    
17.0
%
Asia Pacific
    
12.4
%
    
14.8
%
Total Revenue
    
10.6
%
    
10.2
%
                 
     
Reported
Quarter
      
Local Currency Adjusted(1)
Quarter
  
Operating Income
            
Flavors & Extracts
    
8.8
 %
   
8.8
%
Color    
22.0
 %
   
21.1
%
Asia Pacific
    
29.6
 %
   
32.4
%
Total Operating Income
    
25.5
 %
   
18.6
%



The Flavors & Extracts Group reported third quarter 2026 revenue of $210.0 million, an increase of $7.0 million versus the prior year’s third quarter. The Group’s revenue increase was driven primarily by higher prices and volume growth. Segment operating income was $30.5 million in the third quarter of 2026, an increase of $2.5 million compared to the prior year’s third quarter.

The Color Group reported revenue of $210.3 million in the third quarter of 2026, an increase of $32.2 million compared to the prior year’s third quarter. The Group’s revenue increase was driven primarily by strong volume growth. Segment operating income was $46.1 million in the third quarter of 2026, an increase of $8.3 million compared to the prior year’s third quarter results.

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Sensient Technologies Corporation
Page 3
Earnings Release – Quarter Ended September 30, 2026
 
October 30, 2026
 
The Asia Pacific Group reported revenue of $47.3 million in the third quarter of 2026, an increase of $5.2 million compared to the prior year’s third quarter. The Group’s revenue increase was driven by strong volume growth and higher prices across the Group. Segment operating income was $12.4 million in the quarter, an increase of $2.8 million compared to the prior year’s third quarter.

Corporate & Other reported operating expenses were $16.5 million in the third quarter of 2026, compared to $17.6 million of operating expenses reported in the prior year’s third quarter.  Local currency adjusted operating expenses(1) for Corporate & Other increased $2.2 million compared to the prior year’s third quarter. The higher operating expenses were primarily due to higher performance-based compensation costs in the third quarter.

2026 OUTLOOK

         
Metric
  
Current Guidance
  
Prior Guidance
         
Local Currency Revenue(1)
  
High Single-Digit to Low Double-Digit Growth
  
High Single-Digit to Low Double-Digit Growth
         
Local Currency Adjusted EBITDA(1)
  
Mid-Teen to High Teen Growth
  
Mid-Teen to High Teen Growth
         
Diluted EPS (GAAP)
  
Between $4.15 and $4.20*
  
Between $4.10 and $4.20*
         
Local Currency Adjusted Diluted EPS(1)
  
Mid-Teen to High Teen Growth
  
Mid-Teen to High Teen Growth
         
*Based on current exchange rates, foreign currency impact is expected to be immaterial for the remainder of the year.

The Company’s guidance is based on current conditions and economic and market trends in the markets in which the Company operates and is subject to various risks and uncertainties as described below.

  (1)
Please refer to “Reconciliation of Non-GAAP Amounts” at the end of this release for more information regarding our non-GAAP financial measures.

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Sensient Technologies Corporation
Page 4
Earnings Release – Quarter Ended September 30, 2026
 
October 30, 2026
 
USE OF NON-GAAP FINANCIAL MEASURES

The Company’s non-GAAP financial measures eliminate the impact of certain items, which, depending on the measure, include: currency movements, depreciation and amortization, Portfolio Optimization Plan costs, and non-cash share-based compensation. These measures are provided to enhance the overall understanding of the Company’s performance when viewed together with the GAAP results. Refer to “Reconciliation of Non-GAAP Amounts” at the end of this release.

CONFERENCE CALL

The Company will host a conference call to discuss its 2026 third quarter financial results at 8:30 a.m. CDT on Friday, October 30, 2026. To participate in the conference call, contact Chorus Call Inc. at (844) 492-3726 or (412) 317-1078, and ask to join the Sensient Technologies Corporation conference call. Alternatively, the call can be accessed by using the webcast link that is available on the Investor Information section of the Company’s web site at www.sensient.com.

A replay of the call will be available one hour after the end of the conference call through November 6, 2026 by calling (855) 669-9658 and using access code 9910787. An audio replay and written transcript of the call will also be posted on the Investor Information section of the Company’s web site at www.sensient.com on or after November 3, 2026.

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Sensient Technologies Corporation
Page 5
Earnings Release – Quarter Ended September 30, 2026
 
October 30, 2026
 
This release contains statements that may constitute “forward-looking statements” within the meaning of Federal securities laws including in the quote from our Chairman, President, and Chief Executive Officer and under “2026 Outlook” above. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, and other factors concerning the Company’s operations and business environment. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements and that could adversely affect the Company’s future financial performance include the following: the Company’s ability to manage general business, economic, and capital market conditions, including actions taken by customers in response to such market conditions, and the impact of recessions and economic downturns; the impact of macroeconomic and geopolitical volatility, including inflation and shortages impacting the availability and cost of raw materials, energy, and other supplies, disruptions and delays in the Company’s supply chain, and the conflicts between Russia and Ukraine and in the Middle East; industry, regulatory, legal, and economic factors related to the Company’s domestic and international business; the effects of tariffs, trade barriers, and disputes; the availability and cost of labor, logistics, and transportation; the pace and nature of new product introductions by the Company and the Company’s customers; the Company’s ability to anticipate and respond to changing consumer preferences, changing technologies, and changing regulations; the Company’s ability to successfully implement its growth strategies; the outcome of the Company’s various productivity-improvement and cost-reduction efforts, acquisition and divestiture activities, and Portfolio Optimization Plan; growth in markets for products in which the Company competes; industry and customer acceptance of price increases; actions by competitors; the Company’s ability to enhance its innovation efforts and drive cost efficiencies; currency exchange rate fluctuations; and other factors included in “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, and in other documents that the Company files with the SEC. The risks and uncertainties identified above are not the only risks the Company faces. Additional risks and uncertainties not presently known to the Company or that it currently believes to be immaterial also may adversely affect the Company. Should any known or unknown risks and uncertainties develop into actual events, these developments could have material adverse effects on our business, financial condition, and results of operations. This release contains time-sensitive information that reflects management’s best analysis only as of the date of this release. Except to the extent required by applicable laws, the Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied herein will not be realized.

ABOUT SENSIENT TECHNOLOGIES

Sensient Technologies Corporation is a leading global manufacturer and marketer of colors, flavors, and other specialty ingredients.  Sensient uses advanced technologies and robust global supply chain capabilities to develop specialized solutions for food and beverages, as well as products that serve the pharmaceutical, nutraceutical, and personal care industries. Sensient’s customers range in size from small entrepreneurial businesses to major international manufacturers representing some of the world’s best-known brands.  Sensient is headquartered in Milwaukee, Wisconsin.
www.sensient.com

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Sensient Technologies Corporation
Page 6
(In thousands, except percentages and per share amounts)
 
(Unaudited)
 
Consolidated Statements of Earnings
  
Three Months Ended September 30,
    
Nine Months Ended September 30,
  
                                     
   
2026
    
2025
    
% Change
    
2026
    
2025
    
% Change
  
                                     
Revenue
  
$
455,841
    
$
412,109
      
10.6
%
  
$
1,353,756
    
$
1,218,664
      
11.1
%
                                                 
Cost of products sold
    
290,893
      
270,767
      
7.4
%
    
863,321
      
802,713
      
7.6
%
Selling and administrative expenses
    
92,499
      
83,636
      
10.6
%
    
274,558
      
247,009
      
11.2
%
                                                 
Operating income
    
72,449
      
57,706
      
25.5
%
    
215,877
      
168,942
      
27.8
%
Interest expense
    
8,345
      
7,328
              
24,421
      
22,060
          
                                                 
Earnings before income taxes
    
64,104
      
50,378
              
191,456
      
146,882
          
Income taxes
    
15,760
      
13,422
              
47,583
      
37,877
          
                                                 
Net earnings
  
$
48,344
    
$
36,956
      
30.8
%
  
$
143,873
    
$
109,005
      
32.0
%
                                                 
Earnings per share of common stock:
                                                
Basic
  
$
1.14
    
$
0.87
            
$
3.40
    
$
2.58
          
Diluted
  
$
1.13
    
$
0.87
            
$
3.37
    
$
2.56
          
                                                 
Average common shares outstanding:
                                                
Basic
    
42,353
      
42,248
              
42,333
      
42,231
          
Diluted
    
42,831
      
42,665
              
42,753
      
42,570
          

Results by Segment
  
Three Months Ended September 30,
    
Nine Months Ended September 30,
  
                                     
Revenue
  
2026
    
2025
    
% Change
    
2026
    
2025
    
% Change
  
                                     
Flavors & Extracts
  
$
209,973
    
$
202,970
      
3.5
%
  
$
624,977
    
$
599,902
      
4.2
%
Color
    
210,343
      
178,156
      
18.1
%
    
624,656
      
525,188
      
18.9
%
Asia Pacific
    
47,304
      
42,082
      
12.4
%
    
140,148
      
126,727
      
10.6
%
Intersegment elimination
    
(11,779
)
    
(11,099
)
            
(36,025
)
    
(33,153
)
        
                                                 
Consolidated
  
$
455,841
    
$
412,109
      
10.6
%
  
$
1,353,756
    
$
1,218,664
      
11.1
%
                                                 
Operating Income
                                                
                                                 
Flavors & Extracts
  
$
30,519
    
$
28,038
      
8.8
%
  
$
87,700
    
$
81,533
      
7.6
%
Color
    
46,054
      
37,734
      
22.0
%
    
142,633
      
111,508
      
27.9
%
Asia Pacific
    
12,364
      
9,541
      
29.6
%
    
34,504
      
27,926
      
23.6
%
Corporate & Other
    
(16,488
)
    
(17,607
)
            
(48,960
)
    
(52,025
)
        
                                                 
Consolidated
  
$
72,449
    
$
57,706
      
25.5
%
  
$
215,877
    
$
168,942
      
27.8
%
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Sensient Technologies Corporation
Page 7
(In thousands)
 
(Unaudited)
 

Consolidated Condensed Balance Sheets
  
September 30,
    
December 31,
  
   
2026
    
2025
  
             
Cash and cash equivalents
  
$
42,625
    
$
36,533
  
Trade accounts receivable
    
373,755
      
305,380
  
Inventories
    
791,096
      
678,220
  
Prepaid expenses and other current assets
    
75,168
      
59,717
  
Fixed assets held for sale
    
-
      
1,598
  
Total Current Assets
    
1,282,644
      
1,081,448
  
                 
Goodwill & intangible assets (net)
    
443,017
      
449,827
  
Property, plant, and equipment (net)
    
606,429
      
539,296
  
Other assets
    
143,742
      
173,566
  
                 
Total Assets
  
$
2,475,832
    
$
2,244,137
  
                 
Trade accounts payable
  
$
187,501
    
$
138,344
  
Short-term borrowings
    
257
      
352
  
Other current liabilities
    
135,248
      
124,887
  
Total Current Liabilities
    
323,006
      
263,583
  
                 
Long-term debt
    
790,148
      
709,232
  
Accrued employee and retiree benefits
    
23,733
      
24,045
  
Other liabilities
    
52,220
      
53,763
  
Shareholders’ Equity
    
1,286,725
      
1,193,514
  
                 
Total Liabilities and Shareholders’ Equity
  
$
2,475,832
    
$
2,244,137
  

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Sensient Technologies Corporation
Page 8
(In thousands, except per share amounts)
 
(Unaudited)
 
Consolidated Statements of Cash Flows
            
Nine Months Ended September 30,
            
 
  
2026
    
2025
  
Cash flows from operating activities:
            
Net earnings
  
$
143,873
    
$
109,005
  
Adjustments to arrive at net cash provided by operating activities:
                
Depreciation and amortization
    
47,680
      
45,890
  
Share-based compensation expense
    
13,762
      
10,584
  
Net (gain) loss on assets
    
(39
)
    
166
  
Portfolio Optimization Plan costs
    
-
      
2,107
  
Deferred income taxes
    
17,090
      
3,899
  
Changes in operating assets and liabilities:
                
Trade accounts receivable
    
(71,188
)
    
(19,716
)
Inventories
    
(117,230
)
    
(35,609
)
Prepaid expenses and other assets
    
(10,299
)
    
(9,160
)
Trade accounts payable and other accrued expenses
    
45,089
      
(10,973
)
Accrued salaries, wages, and withholdings
    
5,962
      
(9,781
)
Income taxes
    
(1,139
)
    
(5,076
)
Other liabilities
    
1,759
      
1,927
  
                 
Net cash provided by operating activities
    
75,320
      
83,263
  
                 
Cash flows from investing activities:
                
Acquisition of property, plant, and equipment
    
(105,775
)
    
(57,788
)
Proceeds from sale of assets
    
2,032
      
397
  
Acquisition of new business
    
-
      
(4,867
)
Other investing activities
    
(536
)
    
1,260
  
                 
Net cash used in investing activities
    
(104,279
)
    
(60,998
)
                 
Cash flows from financing activities:
                
Proceeds from additional borrowings
    
180,065
      
125,619
  
Debt payments
    
(88,310
)
    
(84,662
)
Dividends paid
    
(52,315
)
    
(52,196
)
Other financing activities
    
(4,411
)
    
(2,648
)
                 
Net cash provided by (used in) financing activities
    
35,029
      
(13,887
)
                 
Effect of exchange rate changes on cash and cash equivalents
    
22
      
7,665
  
                 
Net increase in cash and cash equivalents
    
6,092
      
16,043
  
Cash and cash equivalents at beginning of period
    
36,533
      
26,626
  
Cash and cash equivalents at end of period
  
$
42,625
    
$
42,669
  

Supplemental Information
            
Nine Months Ended September 30,
  
2026
    
2025
  
             
Dividends paid per share
  
$
1.23
    
$
1.23
  

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Sensient Technologies Corporation
Page 9
(In thousands, except percentages and per share amounts)
 
(Unaudited)
 
Reconciliation of Non-GAAP Amounts           
The Company’s results for the three and nine months ended September 30, 2026 and 2025 include adjusted operating income, adjusted net earnings, and adjusted diluted earnings per share, which, in each case, exclude Portfolio Optimization Plan costs.

   
Three Months Ended September 30,
    
Nine Months Ended September 30,
  
   
2026
    
2025
    
% Change
    
2026
    
2025
    
% Change
  
Operating income (GAAP)
  
$
72,449
    
$
57,706
      
25.5
%
  
$
215,877
    
$
168,942
      
27.8
%
Portfolio Optimization Plan costs  – Cost of products sold
    
-
      
649
              
-
      
4,252
          
Portfolio Optimization Plan costs – Selling and administrative expenses
    
-
      
2,674
              
-
      
5,274
          
Adjusted operating income
  
$
72,449
    
$
61,029
      
18.7
%
  
$
215,877
    
$
178,468
      
21.0
%
                                                 
Net earnings (GAAP)
  
$
48,344
    
$
36,956
      
30.8
%
  
$
143,873
    
$
109,005
      
32.0
%
Portfolio Optimization Plan costs, before tax
    
-
      
3,323
              
-
      
9,526
          
Tax impact of Portfolio Optimization Plan costs(1)
    
-
      
649
              
-
      
(868
)
        
Adjusted net earnings
  
$
48,344
    
$
40,928
      
18.1
%
  
$
143,873
    
$
117,663
      
22.3
%
                                                 
Diluted earnings per share (GAAP)
  
$
1.13
    
$
0.87
      
29.9
%
  
$
3.37
    
$
2.56
      
31.6
%
Portfolio Optimization Plan costs, net of tax
    
-
      
0.09
              
-
      
0.20
          
Adjusted diluted earnings per share
  
$
1.13
    
$
0.96
      
17.7
%
  
$
3.37
    
$
2.76
      
22.1
%
                                 
Note: Earnings per share calculations may not foot due to rounding differences.                                 
                       
(1)
Tax impact adjustments were determined based on the nature of the underlying non-GAAP adjustments and their relevant jurisdictional tax rates.
                                            
Results by Segment
  
Three Months Ended September 30,
  
     
2026
      
Adjustments(2)
    
Adjusted
2026
      
2025
      
Adjustments(2)
    
Adjusted
2025
  
Operating Income
                        
                                     
Flavors & Extracts
  
$
30,519
    
$
-
    
$
30,519
    
$
28,038
    
$
-
    
$
28,038
  
Color
    
46,054
      
-
      
46,054
      
37,734
      
-
      
37,734
  
Asia Pacific
    
12,364
      
-
      
12,364
      
9,541
      
-
      
9,541
  
Corporate & Other
    
(16,488
)
    
-
      
(16,488
)
    
(17,607
)
    
3,323
      
(14,284
)
                                                 
Consolidated
  
$
72,449
    
$
-
    
$
72,449
    
$
57,706
    
$
3,323
    
$
61,029
  

Results by Segment
  
Nine Months Ended September 30,
  
   
 
2026
    
 
Adjustments(2)
    
Adjusted
2026
    
 
2025
    
 
Adjustments(2)
    
Adjusted
2025
  
Operating Income
                        
                                     
Flavors & Extracts
  
$
87,700
    
$
-
    
$
87,700
    
$
81,533
    
$
-
    
$
81,533
  
Color
    
142,633
      
-
      
142,633
      
111,508
      
-
      
111,508
  
Asia Pacific
    
34,504
      
-
      
34,504
      
27,926
      
-
      
27,926
  
Corporate & Other
    
(48,960
)
    
-
      
(48,960
)
    
(52,025
)
    
9,526
      
(42,499
)
                                                 
Consolidated
  
$
215,877
    
$
-
    
$
215,877
    
$
168,942
    
$
9,526
    
$
178,468
  
 
(2)
Adjustments consist of Portfolio Optimization Plan costs.

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Sensient Technologies Corporation
Page 10
(In thousands, except percentages and per share amounts)
 
(Unaudited)
 
Reconciliation of Non-GAAP Amounts - Continued

The following table summarizes the percentage change in the 2026 results compared to the 2025 results for the corresponding periods.           

   
Three Months Ended September 30, 2026
  
Revenue
  
Total
    
Foreign
Exchange
Rates
    
Adjustments(3)
    
Local
Currency
Adjusted
  
Flavors & Extracts
    
3.5
%
    
0.3
%
    
N/A
      
3.2
%
Color
    
18.1
%
    
1.1
%
    
N/A
      
17.0
%
Asia Pacific
    
12.4
%
    
(2.4
%)
    
N/A
      
14.8
%
Total Revenue
    
10.6
%
    
0.4
%
    
N/A
      
10.2
%
 
                                
Operating Income
                                
Flavors & Extracts
    
8.8
%
    
0.0
%
    
0.0
%
    
8.8
%
Color
    
22.0
%
    
0.9
%
    
0.0
%
    
21.1
%
Asia Pacific
    
29.6
%
    
(2.8
%)
    
0.0
%
    
32.4
%
Corporate & Other
    
(6.4
%)
    
0.0
%
    
(21.8
%)
    
15.4
%
Total Operating Income
    
25.5
%
    
0.1
%
    
6.8
%
    
18.6
%
Diluted Earnings Per Share
    
29.9
%
    
0.0
%
    
12.2
%
    
17.7
%
Adjusted EBITDA
    
15.6
%
    
0.2
%
    
N/A
      
15.4
%

   
Nine Months Ended September 30, 2026
  
Revenue
  
Total
    
Foreign
Exchange
Rates
    
Adjustments(3)
    
Local
Currency
Adjusted
  
Flavors & Extracts
    
4.2
%
    
1.3
%
    
N/A
      
2.9
%
Color
    
18.9
%
    
3.2
%
    
N/A
      
15.7
%
Asia Pacific
    
10.6
%
    
0.0
%
    
N/A
      
10.6
%
Total Revenue
    
11.1
%
    
2.0
%
    
N/A
      
9.1
%
 
                                
Operating Income
                                
Flavors & Extracts
    
7.6
%
    
0.9
%
    
0.0
%
    
6.7
%
Color
    
27.9
%
    
3.8
%
    
0.0
%
    
24.1
%
Asia Pacific
    
23.6
%
    
0.0
%
    
0.0
%
    
23.6
%
Corporate & Other
    
(5.9
%)
    
0.0
%
    
(21.1
%)
    
15.2
%
Total Operating Income
    
27.8
%
    
2.9
%
    
6.7
%
    
18.2
%
Diluted Earnings Per Share
    
31.6
%
    
3.1
%
    
9.3
%
    
19.2
%
Adjusted EBITDA
    
18.0
%
    
2.3
%
    
N/A
      
15.7
%
                    
(3)
Adjustments consist of Portfolio Optimization Plan costs.

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Sensient Technologies Corporation
Page 11
(In thousands, except percentages)
 
(Unaudited)
 
Reconciliation of Non-GAAP Amounts - Continued                      
The following table summarizes the reconciliation between Operating Income (GAAP) and Adjusted EBITDA for the three months and nine months ended September 30, 2026 and 2025.
 
   
Three Months Ended September 30,
    
Nine Months Ended September 30,
  
                                     
   
2026
    
2025
    
% Change
    
2026
    
2025
    
% Change
  
Operating income (GAAP)
  
$
72,449
    
$
57,706
      
25.5
%
  
$
215,877
    
$
168,942
      
27.8
%
Depreciation and amortization
    
16,252
      
15,556
              
47,680
      
45,890
          
Share-based compensation expense
    
4,382
      
3,945
              
13,762
      
10,584
          
Portfolio Optimization Plan costs, before tax
    
-
      
3,323
              
-
      
9,526
          
Adjusted EBITDA
  
$
93,083
    
$
80,530
      
15.6
%
  
$
277,319
    
$
234,942
      
18.0
%

The following table summarizes the reconciliation between Debt (GAAP) and Net Debt, and Operating Income (GAAP) and Credit Adjusted EBITDA for the trailing twelve months ended September 30, 2026 and 2025.

   
September 30,
  
Debt
  
2026
      
2025
  
Short-term borrowings
  
$
257
      
$
777
  
Long-term debt
    
790,148
        
711,177
  
Credit Agreement adjustments(4)
    
(24,933
)
      
(27,992
)
Net Debt
  
$
765,472
      
$
683,962
  
                   
Operating income (GAAP)
  
$
254,063
      
$
210,938
  
Depreciation and amortization
    
62,888
        
61,034
  
Share-based compensation expense
    
17,124
        
13,688
  
Portfolio Optimization Plan costs, before tax
    
6,280
        
10,382
  
Other non-operating gains(5)
    
(1,071
)
      
(495
)
Credit Adjusted EBITDA
  
$
339,284
      
$
295,547
  
                   
Net Debt to Credit Adjusted EBITDA
    
2.3
x
      
2.3
x

(4)
Adjustments include cash and cash equivalents, as described in the Company’s Fourth Amended and Restated Credit Agreement (Credit Agreement), and certain letters of credit and hedge contracts.
(5)
Adjustments consist of certain financing transaction costs, certain non-financing interest items, and gains and losses related to certain non-cash, non-operating, and/or non-recurring items as described in the Credit Agreement.
 
We have included each of these non-GAAP measures in order to provide additional information regarding our underlying operating results and comparable period-over-period performance. Such information is supplemental to information presented in accordance with GAAP and is not intended to represent a presentation in accordance with GAAP. These non-GAAP measures should not be considered in isolation. Rather, they should be considered together with GAAP measures and the rest of the information included in this release and our SEC filings. Management internally reviews each of these non-GAAP measures to evaluate performance on a comparative period-to-period basis and to gain additional insight into underlying operating and performance trends, and we believe the information can be beneficial to investors for the same purposes. These non-GAAP measures may not be comparable to similarly titled measures used by other companies.