DuPont posts sharply higher earnings in first quarter

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DuPont reported sharply higher earnings in the first quarter, thanks to cost-cutting efforts and stronger markets. 

The company’s performance beat earnings forecasts.

First-quarter sales were $7.7 billion, up 5 percent compared to the prior year on a 4 percent benefit from volume and a 1 percent price increase.  Volume  increased  in almost all segments, led by Performance Materials, Electronics & Communications and Agriculture. Agriculture sales were positively impacted by the change in timing of seed deliveries which benefitted first quarter sales by approximately $140 million. This timing aided sales by 2 percent in the quarter.

“Our team delivered strong operational performance in the first quarter, growing operating EPS by 30 percent,” said Ed Breen,  CEO. “The strength of our new product introductions and increased demand in key markets together resulted in top-line increases in almost every business. We also made significant progress on key milestones in the merger with Dow, including receipt of conditional approval from the European Commission and an agreement with FMC to divest certain crop protection assets and acquire substantially all of its Health & Nutrition segment. We continue to expect to close the merger in August of this year and quickly begin working on the 500-plus projects already identified to deliver the targeted $3 billion in cost synergies.”

The following is a summary of business results for each of the company’s reportable segments comparing first quarter with the prior year unless otherwise noted.

The company expects first-half 2017 GAAP (generally accepted accounting principles)  earnings per share of about $2.42, a decrease of about 5 percent from prior year. First-half 2017 operating earnings per share are expected to be about $2.90, an increase of about 16 percent versus prior year primarily driven by sales growth. The increase in sales is due to the impact of the change in timing of seed deliveries, primarily related to the southern U.S route-to-market change in agriculture, and strength in global automotive markets. These benefits are anticipated to be partially offset by the expected reduction in planted corn acres in North America and higher product costs in Performance Materials and Agriculture.

The company’s first-half 2017 GAAP1 earnings include an expected net charge of about $0.32 per share for items primarily related to transaction costs associated with the planned merger with Dow. 

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