DuPont: 4Q Segment Operating Earnings Grow 52% on Higher Volume, Improved Operating Margins

29 Jan 2014 --- DuPont announced fourth quarter 2013 operating earnings of $.59 per share compared to $.20 per share in the prior year. GAAP1 earnings from continuing operations were $183 million or $.19 per share, versus $4 million or zero per share last year. Fourth quarter results reflect strong volume growth, improved operating margins and a lower base tax rate compared to the prior year.

The company said that it expects full-year 2014 operating earnings of $4.20 to $4.45 per share, up 8 to 15 percent versus 2013. DuPont separately announced that its Board of Directors authorized a new $5 billion share repurchase program, with $2 billion expected to occur in 2014.

“Our strong fourth quarter results reflect successful execution across the company against the backdrop of a gradually improving global economy,” said DuPont Chair and CEO Ellen Kullman. “For the year, we delivered double-digit operating earnings growth and higher margins, aside from the substantial decline in Performance Chemicals. The improvement was driven by higher volumes, new innovative products and productivity gains.”

“Our 2013 results and strategic actions demonstrate we are advancing our plan to build a higher growth, higher value DuPont and reinforce our decision to separate Performance Chemicals into a strong, independent company,” Kullman said. “Our $5 billion share repurchase program reflects ongoing confidence in our plan to continue increasing the value of DuPont for shareholders in 2014 and beyond.”

2013 operating earnings were $3.88 per share, up 3 percent from $3.77 per share in the prior year. Sales increased 3 percent to $35.7 billion with 5 percent higher volume.  GAAP earnings from continuing operations were $3.04 per share versus $2.59 per share last year.

Segment operating earnings were $5.9 billion, down from $6.3 billion last year primarily due to a $0.8 billion decline ($.66 per share) in Performance Chemicals. Excluding Performance Chemicals in both years, segment operating earnings increased $490 million, or 11 percent.

Agriculture operating earnings grew 16 percent on 13 percent higher sales, partially offset by higher seed input costs and negative currency impact. Sales growth was principally driven by higher global seed prices and volumes, increased global insecticide and fungicide volumes, and the benefit of increased ownership in Pannar Seed (Pty) Ltd.
Free cash flow was $1.3 billion versus $3.1 billion in the prior year, primarily due to the decline in Performance Chemicals earnings, changes in Agriculture working capital, and the absence of Performance Coatings earnings following the 2013 divestiture.

The unfunded pension and OPEB liability decreased $4.9 billion to $8.4 billion at December 31, 2013.

Global Consolidated Net Sales – 4th Quarter
Fourth quarter 2013 net sales of $7.7 billion increased 6 percent versus last year, reflecting 9 percent higher volume, partly offset by 2 percent lower local selling prices and a 1 percent negative currency impact.  The table below shows fourth quarter regional sales and variances versus fourth quarter 2012.

Full-year 2013 net sales of $35.7 billion increased 3 percent versus last year, reflecting 5 percent higher volume, partly offset by 1 percent lower local selling prices and a 1 percent negative currency impact. The table below shows full year regional sales and variances versus full year 2012.