DuPont Reports Its 3Q 2022 Results

DuPont announced financial results for the third quarter of 2022. Third quarter net sales of $3.3 billion increased 4%, with organic sales increasing 11% versus year-ago period. Meanwhile, 3Q GAAP income from continuing operations was $359 million, as operating EBITDA of $856 million increased 5% versus year-ago period.

“Despite a continued challenging macro environment marked by substantial cost inflation, we delivered better than expected top-line and bottom-line financial performance through disciplined operational execution including necessary targeted pricing actions,” said Ed Breen, DuPont executive chairman and CEO.

“Underlying demand during the quarter remained strong in most of our key end-markets notably semiconductor, water and general industrial,” Breen added. “Looking ahead, we remain focused on solid execution and operating discipline to maintain strong financial performance in a global environment facing continued uncertainties.

“Last week’s closing of the M&M divestiture to Celanese was a milestone event for DuPont, advancing our strategy to concentrate the Company’s portfolio in more stable, higher-growth and higher-margin businesses,” Breen continued. “With the M&M sale now complete, we are returning substantial excess capital to shareholders while also further strengthening our balance sheet to maintain financial flexibility. Our announcement today of a new $5 billion share repurchase program and our intent to retire $2.5 billion in long-term debt highlight our commitment to a balanced capital allocation approach focused on shareholder value creation.”

Operating cash flow in the quarter of $419 million, capital expenditures of $172 million and an adjustment of $115 million for a tax prepayment related to the M&M Divestiture resulted in free cash flow of $362 million.

“As demonstrated by our third quarter results, demand across most of our key end-markets remained strong in the period and our teams continued to successfully execute in a challenging macro environment marked by inflation and foreign currency headwinds,” said Lori Koch, CFOof DuPont. “For the fourth quarter, we expect demand to remain strong in most end-markets, notably water, industrial and auto adhesives, but do anticipate continued softness in consumer electronics globally and some expected slowing in customer semiconductor fab production rates. Further, we plan to reduce our production rates to realign working capital in anticipation of a more normal supply chain environment. Lastly, we expect incremental currency headwinds to further impact both top and bottom-line results.

“As we look to close out the year, our expectation for full year organic sales growth of high-single digits remains unchanged,” Koch continued. “Our updated full year adjusted EPS guidance is inclusive of a $0.09 headwind resulting from an increase in the anticipated tax rate for the full year 2022, offset by an assumed lower share count resulting from planned share repurchases and net interest benefits expected to be realized related to cash proceeds received from the M&M transaction.”