DuPont posts Q4 loss due to downturn in key markets, destocking activity

28-Jan-09

DuPont has posted a net loss of US$629 mln for Q4 - 2008 against net income of US$545 mln in the prior year due to downturn in construction, automobile and consumer spending resulting in inventory destocking across most supply chains during the period. Excluding significant items, Q4 - 2008 net loss was US$249 mln against income of US$522 mln in the prior year. Consolidated net sales in Q4 - 2008 stood at US$5.8 bln, 17% lower than prior year, reflecting 20% lower volume, 7% higher local prices, 3% negative impact from currency and a 1% net reduction from portfolio changes. Full year 2008 earnings stood at US$ 2.20/share versus US$ 3.22 in the previous year. Excluding significant items, 2008 earnings were US$2.78/share versus US$3.28/share in 2007. The company expects weak industrial economic conditions to carry over in 2009 and have accordingly revised its full-year 2009 earnings outlook to a range of US$2.00/share to US$2.50/share as against the previously projected full-year outlook was US$2.25 to US$2.75/share. DuPont's Coatings & Color Technologies business s recorded Q4 - 2008 sales of US$1.3 bln, down 21% year-on-year while it posted pre-tax loss of US$65 mln due to lower volume including charges for low capacity utilization and rising raw material costs that were not fully offset by higher USD selling prices. The company's Performance Materials segment posted sales of US$1.2 bln sliding 30% as weak global demand drove volume down partially offset by higher USD prices. The segment's pre-tax loss stood at US$129 mln showing lower volume across all businesses, charges for low capacity utilization, weaker sales mix and the impact of higher raw material costs that were not fully covered by higher USD selling prices. Also, the Safety & Protection segment sales dipped by 10% YOY posting US$1.3 bln. Pricing gains, particularly in aramids and chemical products, were more than offset by lower demand as all businesses experienced the impact of the global economic slowdown and destocking in the supply chain. This segment exhibited a PTOI of US$105 mln reflecting lower volume, charges for low capacity utilization and increased raw material prices partially offset by higher USD selling prices.