DuPont Sales Fall Ahead of Its Merger With Dow
January 24 2017 - 7:31AM
Dow Jones News
By Imani Moise
Chemical giant DuPont Co., looking to wrap up its merger with
Dow Chemical Co., said its fourth-quarter revenue fell as sliding
crop prices continued to weigh on its agricultural business.
DuPont announced plans to merge with rival Dow Chemical over a
year ago, but antitrust regulators have stalled the deal over
concerns about the impact consolidation could have on innovation in
seeds and pesticides. Earlier this month, the European Union's
antitrust authority pushed back the end date of its review of the
merger for the second time, setting a new date of March 14.
Chief Executive Ed Breen said the company is having constructive
discussions with regulators and still expects to close the deal in
the first half of 2017.
Regulators are scrutinizing the deal alongside other big
agriculture-sector combinations like ChemChina- Syngenta and Bayer-
Monsanto. Dow and DuPont were the first of the group to announce
their deal, in December 2015. The merger would unite the two
companies, with a combined market capitalization of roughly $122
billion, before splitting into three separate companies.
Agriculture sales slid 10% to $1.39 billion due in part to the
timing of seed deliveries. The agriculture business has improved
65% year-over-year but still operated at a loss of $19 million.
The company also forecast first-quarter 2017 earnings to fall
18%, but increase 8% on an adjusted basis, driven by cost-saving
initiatives but partially offset by the expected reduction of corn
planted in the U.S.
Over all for the quarter, DuPont reported a profit of $353
million, or 29 cents a share, compared with a loss of $421 million,
or 26 cents a share, a year earlier. Excluding items, the company
earned 51 cents a share, up from 27 cents. The most recent quarter
included asset-impairment charges, while the year-earlier quarter
included $775 million in restructuring costs.
Revenue dropped 2% to $5.21 billion.
Analysts polled by Thomson Reuters had forecast earnings of 42
cents on $5.29 billion in revenue.
Shares, inactive premarket, closed at $72.78 and have risen 3.8%
over the past three months.
Write to Imani Moise at imani.moise@wsj.com
(END) Dow Jones Newswires
January 24, 2017 07:16 ET (12:16 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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