NEW YORK (Reuters) - Chemical company DuPont Co <DD.N> said on Tuesday that first-quarter profit rose 26 percent, spurred by robust demand for its biotech seed offerings and crop protection chemicals.
By Euan Rocha
NEW YORK (Reuters) - Chemical company DuPont Co <DD.N> said on Tuesday that first-quarter profit rose 26 percent, spurred by robust demand for its biotech seed offerings and crop protection chemicals.
Growing food demand from developing countries and global mandates for the increased use of biofuels have led to soaring grain prices that have encouraged farmers to use more high-yielding biotech seeds, while also increasing their use of fertilizers and crop protection chemicals.
DuPont affirmed its second-quarter and full-year outlooks, while cautioning that weakness in the United States is likely to weigh on strong overseas growth through the rest of 2008.
!ADVERTISEMENT!Net income rose to $1.19 billion, or $1.31 a share, from $945 million, or $1.01 a share, a year earlier. Analysts on average were expecting $1.29 a share, according to Reuters Estimates.
The company's profit also benefited from strong growth in Europe and Asia Pacific, which helped offset major volume declines in the United States, where the construction and automotive industries are slumping.
"The highlight was the 6 percent (in) price increases and the lowlight was the 5 percent decline in U.S. volumes," said Soleil Securities analyst Mark Gulley.
Quarterly net sales rose 9 percent to $8.58 billion, matching Wall Street's forecast, as improved pricing and a weak dollar outstripped the impact of slightly lower volumes and flat sales in the United States.
"Our investments in agriculture and emerging markets enabled us to capitalize on robust growth in those areas which, when combined with gains from our productivity improvement programs, more than offset higher ingredient costs and weakness in certain U.S. markets," said DuPont Chief Executive Charles Holliday, in a statement.
The Wilmington, Delaware-based company had raised its outlook for the first quarter twice in recent weeks, on the back of solid demand for its biotech seed offerings.
DuPont expects full-year earnings of $3.40 to $3.55 per share, excluding items. Wall Street is expecting $3.48.
The company also affirmed its second-quarter earnings outlook of about $1.05 per share, slightly below analysts' expectations of $1.09.
Soleil's Gulley said the second-quarter forecast reflects some of DuPont's typical conservatism, but is also linked to the fact that 12 percent of the company's global sales come from the U.S. housing and automotive markets.
DuPont sells products like Tyvek, Corian and powder coatings that are used in housing, while it is also a major supplier of paints, coatings and other systems used by the automotive industry.
(Reporting by Euan Rocha; Editing by Lisa Von Ahn and Derek Caney)
