DuPont reported a second-quarter loss while seeing double-digit gains in sales of protective materials used in the fight against Covid-19.
The loss was largely the result of a non-cash writedown of the estimated value of its transportation-related businesses, after a drop off in sales in the auto industry.
DuPont reported that it has completed milestones in the merger between DuPont Nutrition & Biosciences and IFF (International Food and Fragrances), with the deal getting the OK from regulators in various nations.
“The quick and decisive actions we took in the early days of the pandemic to strengthen our balance sheet, increase our cost savings initiatives, and differentially manage our portfolio enabled us to deliver a solid quarter,” said Lori Koch, DuPont chief financial officer. “Our businesses are well-equipped to build upon their leading market positions and outperform when markets fully recover.”
Net sales totaled $4.8 billion, down 12 percent versus the year-ago period. On an organic basis, net sales were down 10 percent as organic growth of 7 percent in Electronics & Imaging and 1 percent in Nutrition & Biosciences was more than offset by organic sales declines in the other segments.
On a regional basis, organic sales increased 1 percent in Asia-Pacific versus the year-ago period while the U.S. and Canada, EMEA, and Latin America each declined mid-to-high teens. China sales in our core segments improved 6 percent versus the second quarter 2019 and 20 percent sequentially from the first quarter of 2020.
The Generally Accepted Accounting Principles loss from continuing operations totaled $2.5 billion, versus GAAP loss from continuing operations of $1.1 billion in the year-ago period; the decline mostly attributable to a non-cash impairment charge in the Transportation & Industrial segment resulting from significant near-term demand weakness in the automotive industry due to Covid-19 as well as revised views of market recovery based on third-party estimates.
“For third quarter, we expect sales to be slightly up sequentially with improvement in automotive and residential construction mostly offset by seasonal patterns in Nutrition & Biosciences as well as the impact of supply constraints across our Tyvek enterprise as we perform routine maintenance on the assets.Oil & gas, aerospace, industrial, and commercial construction markets will remain challenged,” said CFO Koch.