11.08.21
DuPont announced financial results for the third quarter 2021.
Net sales totaled $4.3 billion, up 18% versus the year-ago period and up 16% on an organic basis including high-single to low-double digit volume growth across each of the three reporting segments. Double-digit organic growth across Asia Pacific, Europe and North America reflects robust global customer demand in key end-markets. The organic sales growth during the quarter includes 6% pricing gains which primarily reflects actions taken to offset higher raw material costs.
GAAP EPS from continuing operations totaled $0.80 on GAAP income from continuing operations of $433 million, versus GAAP EPS from continuing operations of $0.11 on GAAP income from continuing operations of $86 million in the year-ago period.
Operating EBITDA was $1.09 billion, up 20% versus operating EBITDA in the prior year. The improvement was driven by the ongoing recovery in key end-markets impacted by the COVID-19 pandemic in the year-ago period, most notably automotive, continued strength in electronics markets and the impact of the July 1, 2021 Laird Performance Materials acquisition.
Operating cash flow in the quarter of $842 million and capital expenditures of $208 million resulted in adjusted free cash flow conversion of 112%.
“We delivered third quarter financial results ahead of expectations by maintaining a disciplined focus on operational excellence and pricing actions in the face of unprecedented global supply shortages, logistics challenges and sustained inflationary pressure,” said Ed Breen, DuPont executive chairman and CEO. “We leveraged our global supply network to meet the needs of our customers as demand remained robust across the electronics, automotive, construction and water end-markets and continued to improve across industrial end-markets globally.
“Today we also separately announced a definitive agreement to acquire Rogers Corporation, an advanced materials provider with superior technology innovation, applications engineering expertise, and leading end-market positions. In addition, we announced we are exploring options to divest a substantial portion of the Mobility & Materials segment," Breen continued. “With these announcements, and building on our recent acquisition of Laird Performance Materials, we are significantly advancing our position as a premier multi-industrial company focused in the secular growth areas of electronics, water, protection, industrial technologies and next generation automotive."
“As our third quarter results demonstrate, the demand across our end-markets is strong and we are successfully executing against a backdrop of raw material inflation and global supply chain challenges. We moved quickly to implement strategic price increases in response to rising raw material costs and we will continue these actions in the fourth quarter to deliver neutral price/cost for the year,” said Lori Koch, CFO of DuPont.
“As we head into the fourth quarter, strong demand trends are expected to continue across almost all end-markets; however, we are seeing a deceleration in order patterns stemming from the ongoing global semiconductor chip shortage, primarily in automotive end-markets, which is consistent with the revisions to global auto build estimates which have come down 17% for the second half of 2021 versus estimates for the same period from just a few months ago,” added Koch. “For full year 2021, we now estimate net sales to be between $16.34 billion and $16.40 billion, operating EBITDA between $4.14 billion and $4.17 billion and adjusted EPS in the range of $4.18 to $4.22 per share.”
Net sales totaled $4.3 billion, up 18% versus the year-ago period and up 16% on an organic basis including high-single to low-double digit volume growth across each of the three reporting segments. Double-digit organic growth across Asia Pacific, Europe and North America reflects robust global customer demand in key end-markets. The organic sales growth during the quarter includes 6% pricing gains which primarily reflects actions taken to offset higher raw material costs.
GAAP EPS from continuing operations totaled $0.80 on GAAP income from continuing operations of $433 million, versus GAAP EPS from continuing operations of $0.11 on GAAP income from continuing operations of $86 million in the year-ago period.
Operating EBITDA was $1.09 billion, up 20% versus operating EBITDA in the prior year. The improvement was driven by the ongoing recovery in key end-markets impacted by the COVID-19 pandemic in the year-ago period, most notably automotive, continued strength in electronics markets and the impact of the July 1, 2021 Laird Performance Materials acquisition.
Operating cash flow in the quarter of $842 million and capital expenditures of $208 million resulted in adjusted free cash flow conversion of 112%.
“We delivered third quarter financial results ahead of expectations by maintaining a disciplined focus on operational excellence and pricing actions in the face of unprecedented global supply shortages, logistics challenges and sustained inflationary pressure,” said Ed Breen, DuPont executive chairman and CEO. “We leveraged our global supply network to meet the needs of our customers as demand remained robust across the electronics, automotive, construction and water end-markets and continued to improve across industrial end-markets globally.
“Today we also separately announced a definitive agreement to acquire Rogers Corporation, an advanced materials provider with superior technology innovation, applications engineering expertise, and leading end-market positions. In addition, we announced we are exploring options to divest a substantial portion of the Mobility & Materials segment," Breen continued. “With these announcements, and building on our recent acquisition of Laird Performance Materials, we are significantly advancing our position as a premier multi-industrial company focused in the secular growth areas of electronics, water, protection, industrial technologies and next generation automotive."
“As our third quarter results demonstrate, the demand across our end-markets is strong and we are successfully executing against a backdrop of raw material inflation and global supply chain challenges. We moved quickly to implement strategic price increases in response to rising raw material costs and we will continue these actions in the fourth quarter to deliver neutral price/cost for the year,” said Lori Koch, CFO of DuPont.
“As we head into the fourth quarter, strong demand trends are expected to continue across almost all end-markets; however, we are seeing a deceleration in order patterns stemming from the ongoing global semiconductor chip shortage, primarily in automotive end-markets, which is consistent with the revisions to global auto build estimates which have come down 17% for the second half of 2021 versus estimates for the same period from just a few months ago,” added Koch. “For full year 2021, we now estimate net sales to be between $16.34 billion and $16.40 billion, operating EBITDA between $4.14 billion and $4.17 billion and adjusted EPS in the range of $4.18 to $4.22 per share.”
