By Chelsey Dulaney
DuPont Co. on Tuesday trimmed its earnings outlook for the year,
as weak demand in crop protection markets, lower corn area in Latin
America and tepid soybean volumes weigh on its agricultural
business.
DuPont is now forecasting operating earnings of $3.10 a share,
down 10 cents from its previous forecast, excluding its recently
spun-off performance chemicals division.
Shares of DuPont, down 12% this year, fell 1.6% to $55.80 a
share in premarket trading.
The maker of Pioneer corn seeds has been hit recently by the
strengthening U.S. dollar and low crop prices, as well as weakness
in some chemical prices. DuPont is rolling out new and better
products to help combat the foreign-exchange challenges, while
hastening already-planned cut costs.
In January, the company boosted cost-cut targets and said it
would reach its goal of slashing $1 billion in costs by the end of
2015, ahead of schedule, as it faced pressure from activist
investor Trian Fund Management LP.
In the latest quarter, DuPont said cost cuts added 10 cents to
per-share operating earnings.
"We continued to improve margins across most of our ongoing
businesses through our constant focus on productivity, even as we
address industrywide challenges in agriculture and ongoing currency
headwinds," Chief Executive Ellen Kullman said.
DuPont in May won a victory over Nelson Peltz's Trian, which had
been pushing management to streamline operations and potentially
break up the company, when its shareholders rejected the firm's
push to join its board. At the time, Trian said it would watch
DuPont closely.
A spokeswoman for Trian had no immediate comment on Tuesday.
In all, for the period ended June 30, DuPont reported a profit
of $940 million, or $1.03 a share, down from $1.07 billion, or
$1.15 a share, a year earlier.
Excluding special items, operating earnings ticked up to $1.18 a
share from $1.17 a share a year ago.
DuPont's total revenue fell 12% to $8.88 billion, while sales
fell 11% to $8.6 billion.
Analysts polled by Thomson Reuters had expected a profit of
$1.18 a share and net sales of $8.75 billion.
The U.S. dollar's strength against other currencies has made
DuPont's seeds, crop sprays and chemical products more expensive
for overseas buyers. Currency impacts brought down sales by 5% in
the quarter.
Agricultural sales fell 11% to $3.22 billion amid a 6% drop in
volume and a 5% currency impact. Operating profit fell 7% to $778
million, propped up by cost cuts and price increases from new
products.
DuPont earlier this month completed the spinoff of Chemours Co.,
previously DuPont's performance chemicals division that made paint
pigments and nonstick coatings for frying pans. That division
posted $1.5 billion in revenue and $113 million in operating
earnings in the latest quarter, both representing double-digit
declines from the prior year amid lower prices for titanium
dioxide.
As a result of the separation, DuPont said it now plans to
purchase and retire $2 billion in stock by the end of the year.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com