DUPONT REPORTS FIRST QUARTER 2004 EARNINGS
Summary
|
Earnings Comparisons |
||
|
|
1Q'04 |
1Q'03 |
|
Reported Net Income |
.66 |
.53 |
|
Cumulative Effect of a Change in Accounting Principle |
- |
(.03) |
|
Special Items* |
(.30) |
(.05) |
|
Earnings Before Special Items |
.96 |
.61 |
|
* Individual items are listed in Schedule B. |
||
"We are off to an excellent start in 2004," said Charles O. Holliday, Jr., DuPont chairman and chief executive officer. "Each of the five DuPont growth platforms delivered strong results, exceeding our earnings expectations across all businesses and regions."
Global Consolidated Net Sales and Net Income
Consolidated net sales totaled $8.1 billion compared to $7.0 billion in first
quarter 2003, up 15 percent, reflecting stronger sales volume and higher U.S.
dollar selling prices.
First quarter net income was $668 million, compared to $535 million in the first quarter of 2003. The increase in income principally reflects the benefit of higher sales volumes, higher U.S. dollar prices, a lower income tax rate, and the absence of depreciation on INVISTA™ assets held for sale, partly offset by increases in raw material costs and charges for special items described in the notes accompanying the financial statements. Special items totaled an after-tax charge of $296 million, or $.30 per share, versus a net after-tax charge of $51 million, or $.05 per share taken in the first quarter 2003.
First Quarter Segment Sales
Worldwide and regional segment sales and related variances for the first
quarter 2004 compared with the first quarter 2003 are summarized below. Segment
sales include transfers and a pro rata share of equity affiliate sales.
|
FIRST QUARTER 2004 |
||||||
|
|
Segment Sales |
% Change Due To |
||||
|
|
1Q'04 |
% Change |
Local |
Currency |
Volume |
Other * |
|
Worldwide |
8.9 |
15 |
1 |
6 |
7 |
1 |
|
|
3.9 |
8 |
1 |
0 |
6 |
1 |
|
|
2.7 |
20 |
(2) |
16 |
5 |
1 |
|
|
1.5 |
20 |
1 |
5 |
14 |
0 |
|
Canada & Latin America |
0.8 |
22 |
5 |
4 |
7 |
6 |
|
* Impact for the acquisition of the remaining interest in Fibra and the formation of The Solae Company. |
||||||
Business Segment Performance
Detailed information on segment performance is
provided in schedules C, D, and E which show revenue variance analyses, segment
pretax operating income (PTOI) as reported, and segment PTOI excluding the
impact of special items. The company encourages investors to review these
schedules. Additional segment information is available in the earnings data
section of the
All operating segments delivered double-digit revenue growth in
the quarter versus last year and, in total, increased sales by $1.2 billion or
15 percent. This growth reflects robust volume growth in all operating
segments, with a notable 17 percent volume growth in Electronic &
Communications Technologies. The company's businesses continued to show strong
growth across
Excluding special items, all operating segments delivered significant growth in earnings versus last year. Of the five growth platforms (the five operating segments other than INVISTA), Electronics & Communications showed the most improvement, almost tripling its pre-tax earnings from a low point last year. The remaining growth platforms grew PTOI by 13 to 34 percent, before special items, reflecting a strong Northern Hemisphere agricultural season and broad based momentum in the manufacturing and construction markets that DuPont serves.
Other Items
As previously announced, the company anticipates that
the sale of INVISTA will close on April 30. The company expects the after-tax
proceeds from the sale to be about $4.1 billion, including debt assumed by the
buyer of roundly $270 million. Proceeds from the sale will be used primarily to
reduce debt. The company is also evaluating a potential contribution to its
principal
Outlook
In the second quarter, the company expects to record a charge of approximately
$.17 to $.19 per share in connection with its previously announced cost
improvement program. In addition, the company anticipates second quarter
charges and credits associated with closing the INVISTA transaction, which
cannot be reasonably estimated at this time.
Excluding these special items, the company expects to deliver earnings per share that are in the range of the recently increased First Call earnings consensus estimate of $0.78 (which excludes the impact of special items). The company reaffirms its previous full year earnings per share outlook of $2.10 to $2.30 (excluding the first and second quarter special items discussed above).
"Our first quarter results reinforce the strong future we see for our company, our customers and our shareholders," Holliday said. "Each day we are strengthening our ability to create and seize opportunities around the world."
"With the anticipated closing of the sale of INVISTA just days ahead, we thank all of those who contributed to the 80-year heritage of our textile fiber businesses, creating brands and products that are today synonymous with the textile industry. I wish the people of INVISTA a bright and successful future."
Use of Non-GAAP Measures
Management believes that earnings before special items, a
"non-GAAP" measure, is meaningful to investors because it
provides insight with respect to ongoing operating results of the company.
Special items represent significant charges or credits that are important to an
understanding of the company's ongoing operations. Such measurements are not
recognized in accordance with generally accepted accounting principles (GAAP)
and should not be viewed as an alternative to GAAP measures of performance. A
reconciliation of non-GAAP measures to GAAP is provided in Schedule G.
DuPont is a science company. Founded in 1802, DuPont puts science to work by solving problems and creating solutions that make people's lives better, safer and easier. Operating in more than 70 countries, the company offers a wide range of products and services to markets including agriculture, nutrition, electronics, communications, safety and protection, home and construction, transportation and apparel.
Forward-Looking Statements: This news release contains forward-looking statements based on management's current expectations, estimates and projections. All statements that address expectations or projections about the future, including statements about the company's strategy for growth, product development, market position, expected expenditures and financial results are forward-looking statements. Some of the forward-looking statements may be identified by words like "expects," "anticipates," "plans," "intends," "projects," "indicates," and similar expressions. These statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. Many factors, including those discussed more fully elsewhere in this release and in documents filed with the Securities and Exchange Commission by DuPont, particularly its latest annual report on Form 10-K and quarterly report on Form 10-Q, as well as others, could cause results to differ materially from those stated. These factors include, but are not limited to changes in the laws, regulations, policies and economic conditions, including inflation, interest and foreign currency exchange rates, of countries in which the company does business; competitive pressures; successful integration of structural changes, including restructuring plans, acquisitions, divestitures and alliances; cost of raw materials, research and development of new products, including regulatory approval and market acceptance; and seasonality of sales of agricultural products.
Financial Schedule Attachments (In PDF Format, Adobe Acrobat Reader required) available here.
The full release with schedules included in PDF format is available here.
# # #
04/27/04