DowDuPont profit beats Street for fourth straight quarter
Reuters
Published Aug 02, 2018 07:02AM ET
DowDuPont profit beats Street for fourth straight quarter
By Laharee Chatterjee and Nivedita Bhattacharjee
(Reuters) - U.S. chemicals producer DowDuPont Inc (N:DWDP) reported better-than-expected profit for the fourth straight quarter, driven by higher prices and strong demand for its products including paints and packaging materials.
The company, formed after chemical giants Dow Chemical (NYSE:DOW) and DuPont merged last year, has launched new packing materials, components for laundry detergents and a new seed variety, Chief Financial Officer Howard Ungerleider said on a call before earnings.
He also said the company, which has global operations and often sources materials locally, does not expect any tariff-related impact on business this year.
Sales from the company's biggest revenue generator - materials science business, which makes chemicals used in cosmetics, packaging material, and brake fluids, rose 18 percent to $12.6 billion for the second quarter.
"Our new product launches are resonating with customers, resulting in strong demand across each of our targeted end-markets," DowDuPont CEO Ed Breen said.
Sales from its agricultural business rose 25 percent to $5.7 billion. Cold weather in the northern hemisphere moved demand for the company's seeds from April to May.
The agriculture unit, a weak spot in earlier quarters, has struggled due to higher production and slowing demand.
In April, DowDuPont said the unit could be affected by the escalating U.S.-China trade conflict, after Beijing announced new tariffs on imports of U.S. soybeans and other goods.
The company said overall prices rose 4 percent in the quarter, including a 5 percent increase in materials science business and a 4 percent price rise in agriculture.
Net sales rose 17 percent to $24.2 billion, which the company said compares with net sales of $20.7 billion that DowDuPont would have made had it been one company in the same quarter a year earlier.
Adjusted earnings came in at $1.37 per share, an increase of 41 percent.
Analysts on average were expecting the company to report a profit of $1.30 per share on revenue of $23.6 billion, according to Thomson Reuters I/B/E/S.
Dow and DuPont completed their $130 billion merger last September. It then made changes to operations in the three units it plans to create, under pressure from investors to run the business more efficiently.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.