Ingredion Inc.: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 4 August 2026: press release. Guidance figures: 3 raised, 6 lowered, 2 new, 3 kept. The quarter’s numbers.

Read the filing

Key takeaways

• Reported EPS down, adjusted EPS near flat: Reported diluted EPS fell to $1.78 from $2.99. Adjusted diluted EPS was $2.82 against $2.87. Acquisition costs, impairments and a Pakistan sale gain account for much of the gap. Source
• U.S./CAN operating income down a third: U.S./CAN net sales fell 7% to $488 million. Segment operating income fell 33% to $58 million, which the company ties to lower Argo production, softer volumes and price mix. Source
• Argo reliability and rates improved: Argo reliability improved, with sequentially better production rates and yields through the quarter. Management says the plant runs at normal rates across all major operating units. Source
• Texture volume growth continued: T&HS volume grew for a ninth consecutive quarter. Management ties this to continued customer demand for solutions offerings, including clean-label ingredients. Source
• Pakistan stake sale booked $44 million gain: Management says the majority stake in the Pakistan business was sold. The $44 million net gain is excluded from adjusted results. Guidance removes the Pakistan second-half earnings. Source
• Tate & Lyle shareholders approved offer: Tate & Lyle shareholders approved the 595 pence all-cash offer on July 28. Management calls this an important step toward completing the transaction. Source
• Full-year EPS ranges lowered: Reported EPS range is $9.15 to $9.75, against $9.60 to $10.30 before. Adjusted EPS range is $10.30 to $10.90, against $10.45 to $11.15. Management calls this reaffirming amended guidance. Source

“Ingredion delivered a solid second quarter, with Texture & Healthful Solutions continuing its quarterly net sales volume growth and Food & Industrial Ingredients - U.S./CAN operating results sequentially improving during the quarter,”

Jim Zallie, chairman, president and CEO of Ingredion

Guidance

What changed from last quarter

• Guidance lowered: Full-year reported and adjusted EPS ranges cut from the May ranges, which the company ties to the Pakistan sale.
• Guidance lowered: Full-year reported and adjusted operating income ranges moved lower, to down low double digits and down mid-single digits. Source
• Guidance raised: T&HS full-year operating income raised to up mid-to-high single digits from up low single digits. Source
• Guidance lowered: U.S./CAN full-year operating income now expected down 20 to 25 percent, from down low double digits. Source
• Guidance lowered: All Other now expected to be an operating loss of about $15 million, versus an earlier expected improvement of $5 to $10 million. Source
• Guidance lowered: Corporate costs now expected down mid-single digits, from a prior expectation of flat. Source
• Guidance raised: Reported effective tax rate range raised to 27.4% to 28.9% from 26.3% to 27.8%. Source
• Guidance lowered: Cash from operations range cut to $700 million to $800 million from $725 million to $825 million. Source
• Guidance raised: Capital expenditures range raised to about $450 to $490 million from about $400 to $440 million. Source
• New guidance: Third-quarter 2026 net sales guidance given, compared with the same quarter of 2025. Source
• New: Majority stake in the Pakistan business sold; a net pre-tax gain of $44 million was recorded. Source
• New: Tate & Lyle shareholders accepted Ingredion's 595 pence all-cash offer. Source

Results and growth drivers

• Reported EPS down, adjusted EPS near flat: Reported diluted EPS fell to $1.78 from $2.99. Adjusted diluted EPS was $2.82 against $2.87. Acquisition costs, impairments and a Pakistan sale gain account for much of the gap. Source
• Operating income down 31% reported: Reported operating income was $188 million, down 31%. Adjusted operating income was $258 million, down 5%. Excluding foreign exchange, reported fell 32% and adjusted fell 7%. Source
• Net sales up 1% on FX and volume: Net sales were $1,850 million. Foreign exchange added $36 million and volume $20 million, while price mix subtracted $39 million. Source
• Margin cut per-share operating profit: Operating items reduced adjusted EPS by $0.17 per share. Margin accounted for $0.34 of that, while volume added $0.03 and foreign exchange added $0.05. Source
• First-half sales flat, profit lower: Year-to-date net sales were $3,642 million, flat. Reported operating income was $391 million, down 29%, and adjusted operating income was $470 million, down 14%. Source

Segments and regions

• T&HS operating income up 5%: T&HS net sales were $627 million, up 5%. Segment operating income was $117 million, up $6 million, driven by volume and partly offset by price mix and higher tapioca costs. Source
• LATAM profit down on Mexican currency: LATAM net sales were $611 million, up 3%, or down 3% excluding foreign exchange. Segment operating income fell 7% to $118 million, or 10% excluding foreign exchange translation. Source
• U.S./CAN operating income down a third: U.S./CAN net sales fell 7% to $488 million. Segment operating income fell 33% to $58 million, which the company ties to lower Argo production, softer volumes and price mix. Source
• All Other moved to operating income: All Other operating income was $6 million, against a $1 million loss a year earlier. The company cites continued improvements in Protein Fortification. Source

“Looking ahead, we are focused on continued operational execution across our Food & Industrial Ingredients businesses and accelerating the growth of our Texture & Healthful Solutions portfolio.”

Jim Zallie, chairman, president and CEO of Ingredion

Argo, costs and margins

• Argo reliability and rates improved: Argo reliability improved, with sequentially better production rates and yields through the quarter. Management says the plant runs at normal rates across all major operating units. Source
• Argo thermal event charges recorded: Pre-tax charges of $19 million were recorded in the quarter, and $17 million year to date, primarily for the Argo thermal event. These sit in the adjusted reconciliation. Source
• Gross profit down 11%: Gross profit was $426 million against $477 million, down 11%, while net sales rose 1%. Cost of sales rose 5% to $1,424 million. Source
• Reported tax rate rose sharply: The reported effective tax rate was 33.7%, against 23.6% a year earlier. The adjusted rate was 27.2%, unchanged. Management ties the reported rise mainly to the Pakistan sale gain. Source

Demand and customers

• Texture volume growth continued: T&HS volume grew for a ninth consecutive quarter. Management ties this to continued customer demand for solutions offerings, including clean-label ingredients. Source
• U.S./CAN volumes and price mix softer: U.S./CAN net sales fell $22 million on volume and $13 million on price mix in the quarter, as reported in the segment table. Source
• LATAM delivered in line with expectations: Management says LATAM delivered in line with expectations through focused execution, diversified businesses and network optimization, despite FX headwinds and macroeconomic pressures. Source

Capital, cash and shareholder returns

• Debt flat, cash lower: Total debt was $1.8 billion, unchanged from December 31, 2025. Cash including short-term investments fell to $952 million from $1.0 billion. Source
• Financing costs rose on FX hedge: Net financing costs were $55 million, against $12 million. A $47 million mark-to-market loss on hedges of British pound exposure for the Tate & Lyle deal was the main driver. Source
• Capital spending $210 million to date: Net capital expenditures were $210 million through June 30, 2026, against $193 million in the same period a year earlier. Source
• Dividends paid in the quarter: Dividends of $52 million were paid in the quarter. The $0.82 quarterly dividend declared May 20 was paid July 21, 2026. Source

Pakistan sale and Tate & Lyle deal

• Pakistan stake sale booked $44 million gain: Management says the majority stake in the Pakistan business was sold. The $44 million net gain is excluded from adjusted results. Guidance removes the Pakistan second-half earnings. Source
• Tate & Lyle shareholders approved offer: Tate & Lyle shareholders approved the 595 pence all-cash offer on July 28. Management calls this an important step toward completing the transaction. Source
• Integration planning under way: Integration planning for Tate & Lyle has started. Management describes the completed combination as creating a more comprehensive global leader in ingredient solutions. Source
• Acquisition costs of $53 million: Acquisition and integration costs of $53 million were recorded for the quarter and six months, primarily tied to the Tate & Lyle deal. They are excluded from adjusted results. Source
• Cabo, Brazil facility closure: The closure of the Cabo, Brazil facility was announced. The release ties related impairment and restructuring charges to that closure. Source

Guidance for 2026 and third quarter

• Full-year EPS ranges lowered: Reported EPS range is $9.15 to $9.75, against $9.60 to $10.30 before. Adjusted EPS range is $10.30 to $10.90, against $10.45 to $11.15. Management calls this reaffirming amended guidance. Source
• Pakistan sale shapes second half: Management says the full-year guidance now reflects the Pakistan majority-stake sale's impact on the second half of 2026. Source
• Segment and operating income ranges moved: Reported operating income now down low double digits and adjusted down mid-single digits. T&HS raised to mid-to-high single digits; U.S./CAN cut to down 20 to 25 percent. Source
• Cash flow and capex ranges revised: Cash from operations cut to $700 million to $800 million from $725 million to $825 million. Capital expenditures raised to about $450 to $490 million from $400 to $440 million. Source
• Third-quarter sales and profit guided: Third-quarter net sales expected up low single digits year over year. Reported and adjusted operating income expected down mid-single digits, reflecting the Pakistan sale. Source

Coming up, as management said on 4 August 2026

• Third-quarter operating income guided: Management guides third-quarter reported and adjusted operating income down mid-single digits, reflecting the Pakistan sale. The next guidance update is the third-quarter report. Source
• Tate & Lyle deal not yet complete: The Tate & Lyle acquisition will proceed by scheme of arrangement and is not yet complete. Integration planning has started. Source

Figures management reported

Risks management discussed

• Operational: Argo operational headwinds in the first half of 2026 weigh on U.S./CAN full-year operating income guidance. Source
• External: LATAM operating income guidance reflects the strength of the Mexican peso, which pressures reported results. Source
• Demand: U.S./CAN results reflect softer volumes and price mix, in addition to lower Argo production. Source
• External: Guidance is based on tariff levels in effect at the end of July 2026. Source
• Financial: Management expects higher input cost inflation to partly offset T&HS volume-driven operating income growth. Source

Earlier plans management reported on

• Met: Set in the May release. The August release says the plant runs at normal rates across all major operating units.
• Not stated: Management remains committed to the $100 million full-year target; $14 million was repurchased year to date. Source

Other quarters

• Q1 FY2026 earnings call
• Q4 FY2025 earnings call
• Q3 FY2025 earnings call
• Q2 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.