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DuPont reports third-quarter gain

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RANDALL CHASE | October 22, 2013 07:55 AM EST | AP


DOVER, Del. (AP) — The DuPont Co. says strong demand for agricultural products in Latin America offset weak pricing for a key industrial pigment in contributing to an increase in third-quarter earnings.

The Wilmington chemical company reported net income of $285 million, or 30 cents per share Tuesday, on revenue of $7.8 billion.

Operating earnings totaled 45 cents per share, up from 43 cents per share in last year's third quarter, and easily topping the 41 cents that Wall Street was looking for, according to a FactSet poll.

For the same period last year, DuPont reported net income of about $5 million, and break even on a per-share basis.

The latest quarter saw sales increase 5 percent, and volume was up 9 percent, but DuPont said Tuesday that pricing for titanium dioxide, a widely used whitening pigment, remained weak.

DuPont's agriculture unit led the company's performance in the latest quarter, with volume up 10 percent and prices improving slightly. The unit narrowed its seasonal operating loss by $8 million to $62 million amid strong insecticide demand in Latin America and price improvement in seeds. The company also realized a $26 million gain from its acquisition of a controlling interest in South Africa's Pannar Seed Ltd.

Strong demand for products used in solar energy panels and for personal protection products, such as Kevla,r also contributed to DuPont's improved performance in the third quarter. The electronics and communications unit saw volume increase 14 percent as demand improved in photovoltaic markets, offsetting a 9 percent decline in pricing. The safety and protection unit saw a 5 percent increase in volume, although prices were flat.

"Third quarter sales volumes and operating earnings were stronger across most businesses compared to a soft quarter last year," said DuPont chairwoman and CEO Ellen Kullman. "While we expect overall sequential growth in industrial market demand will remain subdued, fourth quarter operating earnings will be up substantially from last year."

In the same period last year, DuPont was beset by sizeable restructuring charges and announced 1,500 jobs cuts.

In the third-quarter this year, volumes were up in all geographic regions, led by double-digit gains in the Asia-Pacific region and in Europe, the Middle East and Africa.

Kullman said DuPont expects to see modest earnings growth for the year, despite continued hardship in its performance chemicals unit, which includes titanium dioxide, or TiO2. The performance chemicals unit saw volume increase 12 percent in the third quarter, but that was not enough to offset steep price declines for titanium dioxide, refrigerants and fluoropolymers, along with higher raw material inventory costs. The unit's operating earnings fell $159 million to $254 million.

Third-quarter results also included a one-time pretax charge of $72 million related to DuPont's settlement of titanium dioxide antitrust litigation.