21 July 2009 20:10 [Source: ICIS news]
HOUSTON (ICIS news)--DuPont reaffirmed its full-year earnings guidance calling for sequential improvement in the third and fourth quarters, but cautioned that such growth could merely result from a bump from the recession bottom, the US chemicals major said on Tuesday.
“My concern is the true demand recovery,” CEO Ellen Kullman said during a conference call. “Are we going to be bumping along the bottom where we don’t want to think of it as a positive trend, but more of a sideways movement?”
The company reaffirmed a 2009 earnings outlook range of $1.70 to $2.10 per share, excluding significant items. Earnings per share, excluding significant items, were 61 cents in the second quarter.
Likewise, the company said its expectations for a global GDP drop of 2.5% in 2009, a global auto build of 58m vehicles and ?xml:namespace>
DuPont's second-quarter net profits were down 61.3% year on year at $417m (€292m) as demand for key products remained depressed, the company said.
Sales of coatings, products for electronics, the company’s performance products and its high-strength materials were down by 25% from the same period a year ago.
However, those segments all had sequential volume improvements from the first quarter, DuPont said.
“Many of our markets showed improvement with an apparent end to destocking across several supply chains,” Kullman said.
DuPont said the majority of the improvement came from
The lone exception to the company’s year-over-year downturn was the agriculture and nutrition segment, which saw a 15% rise in profits, largely driven by a 21% increase in seed sales.
DuPont said it was on track to achieve its intended $1bn in cost savings for 2009, with 60% of that figure already delivered through the second quarter.
Going forward, DuPont said it would continue to stress both innovation and cost discipline in the midst of the economic crisis, while looking to enhance the company’s “competitive advantage” in the marketplace.
“The assumption is for sequential demand, cost and currency improvement to favour Q4 over Q3,” said Jeffrey Keefer, the company’s chief financial officer.
DuPont moved at $27.80/share in mid-day Tuesday trading on the New York Stock Exchange, down 53 cents, or 1.9%, on the day.
($1 = €0.70)
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