* Earnings ex-items $1.48/share vs. Wall St view $1.46
* Revenue up 8 percent at $11.28 billion
* Expects 2012 earnings at low end of forecast range
* 'Continued softness' in demand for Ti02
* Shares down 2.4 percent
By Ernest Scheyder
July 24 DuPont expects 2012 earnings to
come in at the bottom of its prior forecast range, due in part
to economic uncertainty around the globe, the maker of
chemicals, hybrid seeds and Kevlar bulletproof fiber said on
The updated forecast, for earnings at the "lower end" of a
range of $4.20 to $4.40 per share, came after the company posted
a higher-than-expected profit for the second quarter.
Analysts on average expect earnings of $4.25 per share this
year, meaning DuPont could fall short of Wall Street estimates.
The news pushed DuPont shares down 2.4 percent to $47.52 in
Tuesday afternoon trading.
Higher taxes and currency conversion should also weigh on
results, said Chief Executive Ellen Kullman.
"We're seeing sequential improvement in many markets that
have been very sketchy in the first half of the year," Kullman
said on a conference call with analysts and investors. "Our
ability to forecast is not as great as we used to think it was."
DuPont reported second-quarter net income of $1.18 billion,
or $1.25 per share, down from $1.22 billion, or $1.29 per share,
a year earlier.
Excluding one-time items, the company earned $1.48 per
share. By that measure, analysts expected $1.46, according to
Thomson Reuters I/B/E/S.
Revenue rose 8 percent to $11.28 billion. Analysts had
expected $11.27 billion.
Sales jumped the most in North America and Latin America,
helped largely by strong sales of seeds and other agricultural
products. Kullman said she would closely watch North American
sales to industrial, commercial and housing customers.
"We need to all be cautious as we look at these markets in
the second half of the year," she said.
Europe remains in a recession, Kullman said, echoing
previous comments. DuPont is seeing "some strength" in Russia
and Turkey's economies, she said.
"The expectations in Europe are very low, and they're kind
of bumping along the bottom in a recessionary mode," Kullman
DuPont has received three final bids for its performance
coatings unit, two people familiar with the matter said on
DuPont declined to comment.
The performance coatings business primarily sells to Maaco
and other auto paint refinishers. Ford Motor Co and
General Motors Co are also key customers.
During the conference call on Tuesday morning, the first
question to Kullman was about the progress of the sale.
"I'm not sure where that question is coming from," Kullman
told JPMorgan's Jeff Zekauskas. "If we have anything to announce
about any of our businesses or product lines, we will make sure
we include you."
Kullman stressed, though, that the performance coatings unit
has had a "good performance this year."
Sales fell in all of DuPont's businesses during the first
quarter, except those connected to the food sector.
In the performance chemicals unit, volume fell 10 percent,
primarily because of weak demand for DuPont's titanium dioxide,
or Ti02, paint pigment.
A 9 percent jump in selling prices partly offset the drop in
DuPont is the world's largest producer of the critical
pigment, which is used to give paint and other coatings a white
Earlier this month, Australia-based titanium ore miner Iluka
Resources Ltd confirmed what many investors have feared
for months: Softer demand and higher inventories of the pigment
were affecting production.
The news dented shares of Iluka, as well as DuPont's
titanium dioxide rivals, Tronox Inc and Huntsman Corp
Trying to reassure markets, DuPont issued its own
press release in mid-July, saying Ti02 demand in the second half
of the year should be stronger than what Iluka predicted.
On Tuesday DuPont admitted there was "continued softness" in
Ti02 demand, particularly in Asia and Europe.
"The market became soft in the second half of 2011, and we
have seen slow sequential recovery since then," Kullman said.
"We believe that recent comments in the press regarding demand
outlook overstated the softness in the market."