DuPont reports 4Q loss, steps up cost cuts ahead of Dow deal

On a per-share basis, the St Paul, Minnesota-based company said it had profit of $1.66.

DuPont Co., which agreed last month to a historic merger with Dow Chemical Co., forecast lower-than- expected full-year earnings as the chemical company battles with the effects of a strong dollar and weak demand for its agriculture products.

“We are making progress on key initiatives, including further improving our cost structure and restructuring our organization to enhance our competitiveness”, Breen said in a statement accompanying the earnings report.

Excluding $622m of restructuring and other charges, fourth-quarter operating profit was 27 cents per share, slightly above analysts’ average estimate of 26 cents.

DuPont’s near-term outlook for China, where economic concerns have rattled global markets, is “mixed”, as declining fourth-quarter sales in DuPont’s electronic products were offset by higher volumes in food-ingredient and health products, Mr. Breen said in an interview.

The company said it expects full-year operating earnings of $2.95-$3.10 per share, compared with analysts’ average estimate of $3.10 per share, according to Thomson Reuters I/B/E/S.

Sales fell across all business segments and in all regions, mostly because of negative currency impacts, although volumes declined in North America, as well as the Europe, Middle East and Africa region.

DuPont and Dow’s merger, the biggest ever in the chemicals industry, is planned as a prelude to a split that will create three new companies focused on agricultural products, commodity chemicals and specialty materials.

DuPont and Dow Chemical Co DOW.N agreed to merge in an all-stock deal in December in a first step toward breaking up into three separate businesses. We believe that in the near term, DuPont shares are trading out of sync with those of Dow Chemical (DOW) and are fully valued.

Shares of DuPont (DD) have barely move this morning after beating earnings forecasts by a penny but offering below consensus guidance.

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