DuPont raises 2010 profit outlook, sees continued strong growth

27 July 2010 16:08  [Source: ICIS news]

TORONTO (ICIS news)--DuPont has raised its full-year earning per share guidance as sales and profits are expected to further increase sequentially in the third and fourth quarters after a strong first six months, the company said on Tuesday.

However, 2010 second-half growth rates would slow down from strong year-over-year growth in the first-half, which came against a weak 2009 first half, DuPont executives said during the company’s second-quarter results conference call.   

DuPont said it expected full-year earnings to be a range of $2.90 to $3.05 per share, up from earlier guidance of $2.50-$2.70. In 2009, DuPont reported earnings per share of $1.92.

Full-year revenue growth would be least 15%, compared with DuPont’s earlier projection of revenue growth exceeding 10%.

Overall pre-tax operating income would increase 35% this year, excluding “significant items.” Excluding DuPont’s pharmaceuticals business, pre-tax operating income would increase by over 70%, the executives said.

As for the second quarter, sales in many of DuPont’s key markets, including electronics and titanium dioxide, surpassed their pre-recession peaks in the second quarter, chief executive Ellen Kullman said.

In photovoltaics - part of DuPont’s electronics business - second-quarter sales rose 150% year over year, she noted.

At the same time, DuPont’s coatings, chemicals and its performance polymers businesses expanded margins on improved demand and restructuring measures.

Regionally, China and Latin America were above their pre-recession levels, the US was part-way back to pre-recession peaks, but Europe was lagging, Kullman said.

Analysts at New York-based equity research firm Alembic Global Advisors said DuPont’s second-quarter earnings performance was broad-based, coming on the back of “an impressive 21% volume growth,” with increases in all regions.

Segment volume growth was particularly strong in DuPont’s electronics and communications business (+48%), as well as its performance materials (+35%) and safety and protection (+27%) businesses, Alembic said.

“Our main takeaway from looking at these numbers was that the world clearly does not seem to be coming to an end in the second half of the year,” Alembic said.

“We believe these results provide a decent barometer for the global economy in general and the chemical sector in particular.”

($1 = €0.77)

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By: Stefan Baumgarten
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