DowDuPont, Chemours still have their ups and downs

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Good afternoon,

Two companies with close ties to the overall performance of the U.S. economy reported financial results last week.

Chemours and DowDuPont reported weaker results in keeping with previous guidance from the two companies.

DowDuPont is part way through a spin-off of both companies, with Dow emerging as a public company this month. Next up are DuPont and the combined DowDuPont agriculture business, now under the Corteva brand.

Dow, now a spiffed up and slimmerversion of the old chemical giant,saw lower earnings.

Corteva will emerge as a pure play agriscience company with cutting edge technologies and the uncertainties that come when your business can be hammered by the weather and trade policies. Results for Corteva were hurt by the inability of farmers to get into their fields after continuing widespreadflooding in the Midwest.

Specialty Producers, which will become DuPont seems to be faring OK, but operates in a variety of markets that have seen ups and downs.

As for Chemours, the titanium dioxide business remains highly cyclical. Chemours is also seeing what it sees as illegal imports of a refrigerant chemical into Europe and start-up costs for a new site in Texas.

Both Chemours and DowDuPont are more focused operations these days. Ed Breen, who will stay with DuPont post-spinoff and will hold a board seat at Corteva, continues to look at the business mix, with an eye towards shedding some assets, media accounts indicate.

Chemours CEO Mark Vergnano has done an excellent job in improving the agility of the company after its spinoff from DuPont. Chemours is also investing in Delaware with a new headquarters and R&D complex in Newark.

But both DowDuPont and Chemours are in businesses that are subject to worldwide market forces. Both companies still suggest the outlook could improve later in the year.

Both are also working to appease stockholders with buybacks and dividends.

After all, activist shareholders like Nelson Peltz, lurk in the shadows waiting for any misstep. Peltz forced a boardroom battle at DuPont that led to the departure of Ellen Kullman as CEO. Breen, who was brought in as an alternative to Peltz’s board slate, becameCEO.

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