DuPont Q3 Earnings: EPS Beats While Sales Lag, Revises Annual Outlook & More

DuPont De Nemours, Inc. DD shares are trading higher after the company reported mixed third-quarter results.

The company reported sales growth of 4% year over year to $3.192 billion, missing the consensus of $3.204 billion. Organic sales increased +3% YoY, with a 5% increase in volume offset by a 2% decrease in price. Organic sales by region: EMEA +1%, U.S./Canada -2% and Asia Pacific +9%.

DuPont’s operating EBITDA rose 11% YoY to $857 million, and its margin expanded by 150 bps to 26.8%.

Electronics & Industrial sales totaled $1.551 billion (+13% YoY), and the operating EBITDA margin expanded by 210 bps to 30.1%.

Water & Protection sales were $1.382 billion (-2% YoY), and the operating EBITDA margin expanded by 70 bps to 26.3%.

Adjusted EPS for the quarter was $1.18 (+28% Y/Y), beating the consensus of $1.03.

Operating cash flow from continuing activities for the quarter was almost flat YoY at $737 million, compared to $740 million a year ago. As of September-end, DuPont held cash and equivalents of $1.7 billion.

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“We are benefiting from continued demand recovery in electronics while also seeing improvement in our water and medical packaging end-markets. In the third quarter, a return to year-over-year organic sales growth coupled with solid execution drove strong operating leverage, resulting in 150 basis points of margin expansion,” stated Lori Koch, DuPont’s Chief Executive Officer. 

Q4 Outlook: DuPont expects net sales of ~$3.07 billion versus the consensus of $3.14 billion and Adjusted EPS of ~$0.98 in line with the consensus.

Antonella Franzen, DuPont Chief Financial Officer, commented, “On a year-over-year basis, our fourth quarter guidance reflects continued momentum including sales and earnings growth assumptions for both E&I and W&P. Sequentially, our fourth quarter guidance assumes normal seasonal declines in electronics and construction markets, partially offset by continued recovery in water and medical packaging endmarkets.”

2024 Outlook: DuPont raised the outlook for adjusted EPS to ~$3.90 (prior expectation $3.70 – $3.80) versus the $3.77 consensus and lowered its revenue guidance to $12.365 billion (from the prior $12.40 billion – $12.50 billion view) versus the $12.44 billion consensus.

On May 22, 2024, DuPont announced plans to split into three publicly traded companies by separating its Electronics and Water businesses tax-free to shareholders. DuPont aims to complete the separations within 18-24 months of the announcement date.

Price Action: DD shares are trading higher by 5.31% at $86.20 at the last check Tuesday.

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