DuPont (DD) Tops Q1 EPS by 13c

DuPont (NYSE: DD) reported Q1 EPS of $1.52, $0.13 better than the analyst estimate of $1.39. Revenue for the quarter came in at $7.7 billion versus the consensus estimate of $7.5 billion.

First-Half 2017 Outlook

The company expects first-half 2017 GAAP1 earnings per share of about $2.42, a decrease of about 5 percent from prior year. First-half 2017 operating earnings2 per share are expected to be about $2.90, an increase of about 16 percent versus prior year primarily driven by sales growth. The increase in sales is due to the impact of the change in timing of seed deliveries, primarily related to the southern U.S route-to-market change in Agriculture, and strength in global automotive markets. These benefits are anticipated to be partially offset by the expected reduction in planted corn acres in North America and higher product costs in Performance Materials and Agriculture.

The company's first-half 2017 GAAP1 earnings includes an expected net charge of about $0.32 per share for significant items primarily related to transaction costs associated with the planned merger with Dow. Prior year GAAP1 earnings included a net benefit of $0.20 per share from significant items, primarily due to a gain on the sale of an entity.

First-Quarter Highlights

• GAAP1 earnings per share increased 9 percent to $1.52 from $1.39 in prior year. Operating earnings2 per share increased 30 percent to $1.64 from $1.26 in prior year.
• Sales of $7.7 billion increased 5 percent on a 4-percent benefit from volume and a 1-percent benefit from local price. Sales grew in most segments, led by Agriculture, Performance Materials, and Electronics & Communications.
• Agriculture sales increased 4 percent reflecting benefits from local price and volume. Pricing growth was driven by double-digit gains in Latin America, the launch of new soybean varieties in North America and increased sunflower seed sales in Europe. Volume growth was driven by the change in timing of seed deliveries and increased insecticide and sunflower seed volumes, partially offset by lower expected corn acreage in North America.
• Total company gross margin expanded by more than 80 basis points. Segment operating margins expanded by about 250 basis points, led by improvements in Electronics & Communications, Performance Materials and Agriculture.
• Free cash flow3 improved over $200 million.
• DuPont expects first-half 2017 GAAP1 earnings per share of about $2.42, a decrease of about 5 percent versus prior year. First-half 2017 operating earnings2 per share are expected to be about $2.90, an increase of about 16 percent versus prior year.

For earnings history and earnings-related data on DuPont (DD) click here.

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