10-QPeriod: Q1 FY2013

EIDP, Inc. Quarterly Report for Q1 Ended Mar 31, 2013

Filed April 23, 2013For Securities:CTA-PBCTA-PA

Summary

E. I. du Pont de Nemours and Company (DuPont) reported strong results for the first quarter of 2013, significantly boosted by the sale of its Performance Coatings business. Net sales increased by 2% year-over-year, driven by volume growth in the Agriculture segment and higher pricing. Despite a decline in Performance Chemicals income, the company posted a net income of $3.35 billion, a substantial increase from $1.50 billion in the prior year, largely due to a significant gain from the sale of discontinued operations. The company also continued to return capital to shareholders through share repurchases and dividend payments. The company's strategic focus on growth areas like Agriculture, along with ongoing cost productivity and restructuring savings, positions it well for continued performance. However, investors should remain aware of ongoing litigation and environmental matters that could impact future results, as detailed in the filing.

Financial Highlights

48 data points
Beta

Revenue

$10.41B

40.5% Gross Margin

Net Income

$3.35B

32.2% Net Margin

EPS (Diluted)

$3.58

Total Assets

$50.56B

Cash & Equivalents

$6.55B

Free Cash Flow

-$2.99B

Financial Statements
Beta
Revenue$10.41B
Cost of Revenue$6.19B
Gross Profit$4.21B
R&D Expenses$521.00M
SG&A Expenses$983.00M
Operating Expenses$8.73B
Operating Income$2.24B
Interest Expense$117.00M
Net Income$3.35B
EPS (Basic)$3.60
EPS (Diluted)$3.58

Key Highlights

  • 1Net sales increased by 2% to $10.4 billion for the three months ended March 31, 2013.
  • 2Net income available to common stockholders was $3.348 billion, a significant increase from $1.492 billion in the prior year, primarily due to a gain from the sale of discontinued operations.
  • 3The company successfully divested its Performance Coatings business in February 2013, resulting in a pre-tax gain of $2.7 billion ($1.9 billion net of tax).
  • 4The Agriculture segment showed strong performance with a 14% increase in sales and a 15% increase in pre-tax operating income.
  • 5Cash used for operating activities was $2.67 billion, a significant increase from $1.88 billion in the prior year, impacted by operating changes and pension contributions.
  • 6The company repurchased $1 billion worth of its common stock through an accelerated share repurchase (ASR) agreement, funded by proceeds from the Performance Coatings divestiture.
  • 7The company declared a quarterly dividend of $0.43 per share, an increase from $0.41 per share in the prior year, marking its 435th consecutive quarterly dividend.

Frequently Asked Questions

The primary driver of the substantial increase in net income was the gain recognized from the sale of the Performance Coatings business, which was classified as discontinued operations. This sale generated a pre-tax gain of $2.7 billion ($1.9 billion net of tax).

The divestiture provided a significant cash inflow, which was used to fund a $1 billion share buyback program, strengthening the balance sheet. The proceeds also contributed to the company's overall liquidity.

The Agriculture segment is a key growth area, demonstrating strong volume and pricing gains. The company also benefits from cost productivity and restructuring savings. However, challenges include potential impacts from ongoing litigation and environmental matters, such as the Imprelis® herbicide claims and PFOA-related proceedings, as well as fluctuations in raw material prices and global economic conditions.

The company increased its total debt in the first quarter of 2013 primarily due to the issuance of new notes. It continues to return capital to shareholders through consistent dividend payments, which were increased in this quarter, and significant share repurchases, including a $1 billion accelerated share repurchase program.