DuPont earnings up 1% despite revenue slip on weak ag results
9:27 AM MDT | April 21, 2014 | —Robert Westervelt
DuPont reports first-quarter operating earnings of $1.5 billion, up 1% year-on-year (YOY). Weak agricultural results offset gains across other segments. Operating earnings of $1.58/share were up 1% from the year-ago quarter. DuPont says weather-related plant disruptions and higher raw material costs cut about 7 cts/share from operating earnings.
Sales were $10.1 billion, down 3% YOY, reflecting 1% lower volume, 1% lower local selling prices, and 1% negative currency impact. Volumes in Asia and Europe were both up 6% YOY, while US and Canada volumes were down 7%. Excluding the agriculture and performance chemical segments, US volumes were up about 5%, says DuPont executive v.p. and CFO Nicholas Fanandakis.
“We delivered near-record earnings per share despite the challenges of harsh weather and differences in year-on-year comparisons in our agriculture segment,” says Ellen Kullman, DuPont chair and CEO.
Agriculture segment operating earnings of $1.4 billion were down 5% YOY on lower volumes due to the earlier timing of seed shipments realized in the fourth quarter of 2013 versus the first quarter, lower corn planted area in Brazil and North America, and lower herbicide volumes in North America.
Performance materials operating earnings of $299 million increased 2%, reflecting stronger volumes in automotive markets, largely offset by higher ethane and natural gas costs. Performance chemicals operating earnings of $200 million were down 20%, primarily because of lower prices in fluoroproducts, principally refrigerants.
Safety and protection, electronics, nutrition and health, and industrial biosiences all posted income gains.
DuPont, citing anticipated growth in global industrial market demand, reaffirms its outlook for full-year 2014 operating earnings of $4.20–4.45/share, an increase of 8–15% from 2013. “We expect continued steady growth in global industrial markets,” Kullman says. “We saw it in the first quarter and expect to see it for the rest of the year. This will drive demand for DuPont products.” DuPont says it expects it will earn about 70% of full-year operating earnings per share in the first half.