) saw a rise in its reported profit for the second quarter of 2014.
But its adjusted earnings fell year over year on weak results in
its core agriculture business.
The Delaware-based chemical giant posted adjusted earnings of
$1.17 per share in the reported quarter that were below $1.28 per
share posted a year ago. It was in line with the Zacks Consensus
Estimate. Adjusted earnings exclude one-time items including
charges associated with the separation of the company's performance
chemicals business, restructuring expenses and pension
In the agriculture unit, sales of corn seeds were below DuPont's
expectations while seed inventory write-downs were
higher-than-expected. Moreover, herbicide sales were lower than the
company's expectations, affected by extreme winter weather.
Including one-time items, DuPont registered earnings from
continuing operations of $1.15 per share in the quarter versus
$1.10 per share a year ago. Consolidated net income, as reported,
was up 3.9% year over year to $1,070 million or $1.15 per
Operating earnings from the agriculture business fell 11% in the
reported quarter. The electronics franchise, which supplies
materials for solar panels in the photovoltaic industry, saw a 6%
fall in the quarter. The industrial biosciences unit recorded a 37%
rise while safety and protection posted a 22% gain. Nutrition and
health raked in a 72% gain while the performance materials unit
registered a 9% decline.
DuPont's performance chemicals division (includes the paint
pigment business) remained a weak link. The division's operating
profit clipped 6% in the quarter. The company is spinning off the
unit as it is gradually shifting its focus to high growth, less
cyclical businesses. Separation of the business is expected to
complete by mid-2015.
DuPont's net sales for the reported quarter slipped 1.4% year
over year to $9,706 million as higher volumes for crop protection,
nutrition and health and most industrial businesses was masked by
portfolio changes, a maintenance shutdown and lower corn seed
volumes. Sales missed the Zacks Consensus Estimate of $10,022
DuPont backed its earnings expectations for 2014 and bumped up
its dividend by 4%. Its shares, which are up roughly 18% over a
year, rose 0.4% in
E I Du Pont De Nemours And Company - Earnings
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Revenues were flat year over year at $3.6 billion in the reported
quarter. Lower corn seed and North America herbicide volumes were
partly offset by higher seed prices and increased insecticide and
Electronics & Communications:
Sales fell 6% to $617 million in the quarter. Sales volumes went up
in consumer electronics.
Sales were up 4% to $317 million on higher demand for enzymes for
animal nutrition, food and ethanol production.
Nutrition & Health:
Sales rose 7% to $926 million. Productivity improvement, higher
volumes, better product mix and lower input costs led to a healthy
rise in the division's operating earnings.
Sales were down 8% to around $1.7 billion. Operating earnings fell
on lower pricing for refrigerants and fluoropolymers.
Sales fell 2% to roughly $1.6 billion. Operating earnings fell as
gains from higher performance polymers volumes in automotive
markets were offset by a maintenance shutdown at the company's
Texas ethylene unit.
Safety & Protection:
Sales edged up 1% to roughly $1 billion, aided by higher volumes in
DuPont ended the quarter with cash and cash equivalents of
roughly $4.2 billion, down 38% year over year. Total borrowings and
capital lease obligations fell roughly 16% year over year to around
DuPont's board has approved a 4% rise in its quarterly dividend
to 47 cents per share from the earlier payout of 45 cents per
share. This represents the third hike in the past 27 months.
DuPont, a Zacks Rank #4 (Sell) stock, reaffirmed its earnings
guidance for 2014 which it updated last month. It continues to see
adjusted earnings per share for the year in the band of $4.00 to
$4.10, a 3%-6% year-over-year rise. The current corresponding Zacks
Consensus Estimate is $4.02.
Moreover, DuPont expects a strong second half and foresees
adjusted earnings of $1.25 to $1.35 per share, roughly 40% of which
is expected in the third quarter. The guidance takes into account
the expected improvement in global industrial market demand.
DuPont, last month, provided some color on its earlier
communicated actions to support its more focused portfolio of
businesses following the spinoff of the performance chemicals unit.
These initiatives are expected to deliver cost savings in the near
term through reduction of costs associated with the separation of
the unit and productivity improvements across the board. DuPont
envisions these actions to generate at least $1 billion in savings
by end-2019, two-thirds of which are expected to be realized by
DuPont's results put a spotlight on demand trends for chemical
products across a bevy of industries. Its compatriot
) will report ahead of the opening bell tomorrow.
Among other major chemical names,
) posted better-than-expected second-quarter results on Jul 17.
) will report after the close on Jul 28.
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