DuPont CEO Ed Breen offered an upbeat view of the company at the annual dinner of the Delaware State Chamber of Commerce, announcing a $200 million upgrade at the company’s historic Experimental Station near Wilmington.
“We have momentum going into 2017,” Breen told 900 people at the State Chamber’s annual dinner at the Chase Center on the Riverfront.
Breen said the company will work to bring science-based companies to the Experimental Station, but emphasized that the complex will be a busy place, housing research not only for DuPont but also for Chemours and Dow.
It was one of the first public appearances in Delaware by Breen after the former Tyco CEO he took over as CEO of DuPont in 2015.
In revisiting the painful restructuring of last year, Breen said the company was facing a dilemma.
“We were just too heavy concerning overhead,” Breen said in making a case for a $1 billion in cuts that led to the loss of 1,700 jobs. Those cuts were a hot topic at a rather somber State Chamber annual dinner last year.
A big problem facing the company was a decline in earnings and revenues that had sent the stock downward, Breen said.
According to Breen, the company has already reversed that trend.
“We had a tremendous year,” Breen said of 2016. Breen cited two percent growth in revenue, compared to a two percent decline in 2015.
Regarding the Dow-DuPont merger, Breen said the board opted to get in front of the trend toward consolidation in the agriculture business. It proved to be a wise move as other big mergers were announced
Breen said the big advantage of the merger is its tax-free status.
Following the merger, Dow and DuPont will be spun off into three well-capitalized publicly traded companies that can continue to grow internally or though acquisition.
Two of the companies, including the key agriculture business, will be based in Delaw are.
“The outcome was beautiful,” he said of the spin-off, which will occur about 18 months after the merger is completed. The merger is now before European regulators.
“Gov. Markell was incredible,” Breen said of the effort to convince Dow DuPont to bring the two headquarters operations to Delaware.
He noted that the Markell walked into Breen’s office with a pad and pen seeking ways to keep the companies in Delaware.
In making a case for a strong 2017, Breen said research and development spending will return to the company’s historic level of $1.7 billion.
Breen also pointed to two big customer wins – the company’s venerable Tyvek material now in Lowe’s home improvement stores and a successful launch of an agricultural product in Brazil.
“Our innovation machine is working,” Breen said.
