DuPont’s Operating Income Rises
WILMINGTON, Del. (AP) _ Strong growth in sales of special coatings, pigments and polymers drove DuPont Co.’s second-quarter operating income up 15 percent, though overall net income dropped from the year-ago period.
The nation’s largest chemical company reported earnings Wednesday for the quarter ending June 30 of $688 million, or 65 cents per share. In the year-ago period, DuPont earned $917 million, or 80 cents per share.
Excluding one-time items, DuPont earned $949 million, or 90 cents per share, for the quarter. Analysts surveyed by First Call/Thomson had predicted earns of 88 cents per share.
DuPont, headquartered in Wilmington, benefited from higher sales volume and higher selling prices. But company executives said revenue was offset by higher prices for raw materials, the cost of borrowing and a strong dollar overseas.
The company is also taking a charge of 6 cents per share to put aside cash to defend itself against lawsuits filed by farmers claiming crop damage from Benlate 50 DF, a DuPont-manufactured pesticide.
In June, DuPont was ordered to pay $100.3 million to two Texas fruit companies over claims that their crops were destroyed by Benlate Wetable Powder, prompting plaintiffs in other Benlate cases to reopen their settlement agreements.
``DuPont delivered strong performance in the second quarter,″ said Charles O. Holliday, Jr., DuPont chairman and chief executive officer. ``Most of our businesses performed exceptionally well in spite of higher raw material costs and weak European currencies.″
Overall, DuPont saw sales of $7.9 billion for the quarter, an increase of 13 percent from $7.02 billion a year ago. Sales in the United States were up 5 percent and the growth in sales volume for the Asia Pacific region was strong at 18 percent.
The company is on track to reach its goal this year of increasing overall earnings by 17 to 20 percent, said Gary Pfeiffer, DuPont chief financial officer.
DuPont posted double-digit earnings in 11 of its 18 business segments, including a 19 percent increase in performance coatings and polymers, due in part to the integration of Herberts, a German paint company acquired last year by DuPont.
To offset losses in its nylon business, the company has ordered a global price increase for its nylon fibers effective Aug. 1. Ann Gualtieri, a DuPont spokeswoman, estimated cost increases to be about 4 percent. While sales of nylon remain strong, earnings were down 15 percent in the second quarter due to higher costs of raw manufacturing materials like oil.
For the six months ended June 30, DuPont earned $1.49 billion on revenue of $15.5 billion, compared with earnings of $1.58 billion on revenue of $13.3 billion in the year-ago period.
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