DuPont hit hard in second quarter by automotive market decline

LONDON (CIS)–A significant non-cash impairment charge related to near-term weakness in the automotive industry hit DuPont’s earnings in the second quarter, the company said on Thursday.

DuPont reported a net loss for the quarter of $2.5bn (from a net loss in the second quarter of 2019 of $1.1bn) for continuing operations.

Operating EBITDA (earnings before interest, tax, depreciation and amortisation) were down 20% at $1.1bn.

“Strength in semiconductor, water, Tyvek® protective garment, and health & wellness markets coupled with approximately $130m of cost savings was more than offset by volume declines and charges of $160m associated with temporarily idling certain facilities primarily in the Transportation & Industrial segment.,” DuPont said.

Sales were down 12% at $4.8bn. DuPont said that on an organic basis there was sales growth of 7% in its Electronics & Imaging segment and growth of 1% in Nutrition & Biosciences. The growth was more than offset, however by a decline in other segments: Transport & Industrial, and Safety & Construction.

The company said it expected slightly higher adjusted earnings in the third quarter, in contrast with the second quarter.

“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,” said CFO Lori Koch. “Oil & gas, aerospace, industrial, and commercial construction markets will remain challenged,” she added.