10-QPeriod: Q1 FY2010

EIDP, Inc. Quarterly Report for Q1 Ended Mar 31, 2010

Filed April 27, 2010For Securities:CTA-PBCTA-PA

Summary

E. I. du Pont de Nemours and Company (DuPont) reported a significant turnaround in its first quarter 2010 performance compared to the same period in 2009. Net sales surged by 23% to $8.5 billion, driven by a broad-based economic recovery, particularly in emerging markets, coupled with higher sales volumes and improved pricing. Net income attributable to DuPont more than doubled, reaching $1.13 billion, or $1.24 per diluted share, a substantial increase from $488 million, or $0.54 per diluted share, in Q1 2009. This strong performance was supported by increased manufacturing utilization, lower raw material and energy costs, and favorable currency impacts. DuPont raised its full-year earnings guidance to $2.50-$2.70 per share and increased its free cash flow outlook to over $1.7 billion. The company continues to focus on capital productivity, cost reduction, and strategic growth initiatives in areas like agriculture and advanced materials. While the company faces ongoing legal and environmental contingencies, the robust financial results and positive outlook suggest a strong recovery and improved operational efficiency.

Financial Highlights

46 data points
Beta

Revenue

$8.48B

Net Income

$1.14B

13.4% Net Margin

EPS (Diluted)

$1.24

Total Assets

$37.99B

Cash & Equivalents

$2.91B

Free Cash Flow

-$1.25B

Financial Statements
Beta
Revenue$8.48B
R&D Expenses$365.00M
SG&A Expenses$993.00M
Operating Expenses$7.26B
Interest Expense$103.00M
Net Income$1.14B
EPS (Basic)$1.24
EPS (Diluted)$1.24
Shares Outstanding (Basic)905.49M
Shares Outstanding (Diluted)911.89M

Key Highlights

  • 1Net sales increased by 23% to $8.5 billion in Q1 2010 compared to $6.9 billion in Q1 2009.
  • 2Net income attributable to DuPont rose by 131% to $1.13 billion ($1.24 EPS) from $488 million ($0.54 EPS) year-over-year.
  • 3Sales volumes increased by 19%, with emerging markets showing a strong 33% growth.
  • 4The company raised its full-year earnings per share guidance to $2.50-$2.70 from $2.15-$2.45.
  • 5Full-year free cash flow outlook was increased to greater than $1.7 billion.
  • 6Cost of Goods Sold as a percentage of net sales improved from 75% to 68%, reflecting better manufacturing utilization and lower input costs.
  • 7The company's credit outlook was revised to 'Stable' by Standard & Poor's.

Frequently Asked Questions

The significant increase in net income was primarily driven by a 23% rise in net sales to $8.5 billion, fueled by a broad economic recovery, particularly in emerging markets, leading to higher sales volumes (up 19%) and improved selling prices. Additionally, lower raw material, energy, and freight costs, along with increased manufacturing utilization, contributed to improved profitability.

DuPont utilizes various derivative instruments, including forward exchange contracts, interest rate swaps, and commodity futures/options, as part of its risk management strategy. These instruments are used to hedge foreign currency, interest rate, and commodity price risks, aiming to reduce earnings and cash flow volatility.

DuPont is involved in several significant legal and environmental matters, including ongoing litigation related to PFOA (perfluorooctanoic acid) concerning environmental and drinking water contamination, antitrust investigations in the elastomers market, and various product liability and environmental remediation cases. While the company accrues for probable and estimable liabilities, the ultimate outcomes and potential financial impact remain subject to uncertainty.

DuPont has raised its full-year earnings guidance to a range of $2.50-$2.70 per share and expects free cash flow to exceed $1.7 billion. This positive outlook is based on anticipated continued global economic expansion, strong demand, particularly in Asia Pacific, and the company's ongoing productivity and cost-reduction initiatives.