“We’re off to a strong start for the year,” said DuPont Chairman and CEO Charles O. Holliday, Jr. “Our investments in agriculture and emerging markets enabled us to capitalize on robust growth in those areas which, when combined with gains from our productivity improvement programs, more than offset higher ingredient costs and weakness in certain U.S. markets. We’ll continue to drive faster revenue growth from science-based, high value-added products and greater productivity.”
“Despite the impact of weaker demand in certain U.S. markets, this quarter is a good first step toward achieving our accelerated growth objectives,” Holliday said. “We’re taking the right actions in attractive markets to maximize value for shareholders.”
Global Consolidated Sales
Consolidated net sales increased 9 percent to $8.6 billion in the first quarter. Sales outside the United States represented 62 percent of total sales and increased 16 percent, while sales in the U.S. were equal to last year. A summary of first quarter 2008 worldwide and regional sales performance is shown below.
Net Income and Earnings Per Share
Net income for the first quarter 2008 was $1,191 million, or $1.31 per share. First quarter 2007 net income was $945 million, or $1.01 per share, including a significant item charge of $52 million, or $.06 per share. The table below shows the variances in first quarter 2008 earnings per share (EPS) versus first quarter 2007.
The $0.03 per share variance in fixed costs, noted above, includes estimated savings from cost productivity projects during the first quarter which partially offset cost increases from growth investments and inflation. Fixed costs as a percent of sales decreased to 35.9 percent from 37.7 percent in the prior year.
Business Segment Performance
Segment sales and related percentage variances for first quarter 2008 versus the prior year quarter are shown in the table below.
Segment pre-tax operating income (PTOI) for the first quarter 2008 was $1,851 million versus $1,579 million in the first quarter 2007. Excluding a prior-year significant item charge, segment PTOI increased 13 percent.
The following are business segment highlights comparing first quarter 2008 results to first quarter 2007.
Additional information on segment performance is available on the DuPont Investor Center website at http://www.dupont.com.
Outlook
The company today reaffirmed its full-year 2008 earnings outlook of $3.40 to $3.55 per share and its first half 2008 earnings outlook for growth of about 10 percent, excluding significant items. The company also said it continues to expect second quarter earnings of about $1.05 per share. For the remainder of 2008, the company expects that slowing demand in U.S. markets, including construction and motor vehicle, will offset growth in agriculture and other markets outside the United States.
Use of Non-GAAP Measures
Management believes that measures of income excluding significant items (“non-GAAP” information) are meaningful to investors because they provide insight with respect to ongoing operating results of the company. 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. Reconciliations of non-GAAP measures to GAAP are provided in Schedule D.
DuPont is a science-based products and services company. Founded in 1802, DuPont puts science to work by creating sustainable solutions essential to a better, safer, healthier life for people everywhere. Operating in more than 70 countries, DuPont offers a wide range of innovative products and services for markets including agriculture and food; building and construction; communications; and transportation.
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; seasonality of sales of agricultural products; and severe weather events that cause business interruptions, including plant and power outages, or disruptions in supplier and customer operations.
CONTACT: Anthony Farina of DuPont, +1-302-774-4005,
anthony.r.farina@usa.dupont.com
Web site: http://www.dupont.com/
