Chemicals manufacturer and Dow 30-component DuPont (DD - Free DuPont Stock Report) reported fairly lackluster results for the second quarter, with both the top and bottom line coming up short of our expectations. Sales of roughly $9.7 billion were down modestly from the prior-year figure. Share earnings came in at $1.17, a decline of about 9% from the $1.28 posted in the second quarter of 2013.
Volume growth in Crop Protection, Nutrition & Health, and most other industrial businesses was offset by lower corn seed volumes, a planned maintenance shutdown, and the impact of changes to the company's portfolio. In addition to the decline in corn seed volumes, the Agriculture business reported lower herbicide volumes in North America and greater seed inventory write downs. This was partly offset by higher seed prices, greater insecticide volumes, and lower seed input costs. Overall, though, operating earnings declined by around 11% for the Agriculture segment.
Meanwhile, the Performance Materials business reported a 9% decline in operating earnings, as strong results from Performance Polymers were more than offset by a scheduled maintenance shutdown at the company's ethylene unit. Operating earnings at the Performance Chemicals line decreased by 6%, due mainly to lower prices for refrigerants and fluoropolymers. However, results were more favorable elsewhere, as several business lines posted strong bottom-line growth. The Industrial Biosciences unit benefited from healthy demand for animal nutrition, food, and ethanol production. The Nutrition & Health and Safety & Protection segments also posted an impressive performance.
Today's earnings release follows the announcement of the company's redesign initiative. DuPont is looking to increase focus on its core operations, following the separation of the Performance Chemicals segment expected in mid-2015. The company incurred an aftertax restructuring charge of $182 million ($0.20 per share) in the second quarter, and more charges appear likely going forward. Management expects that this initiative will lead to productivity improvements across all businesses, and contribute at least $1 billion in savings by the end of 2019.
In the near term, the company anticipates a strong performance in the back half of the year, helped by expected growth in industrial market demand. Even so, we have reduced our estimates a bit, in light of the second-quarter pullback. For full-year 2014, we now anticipate sales and share earnings of $36.2 billion and $4.00, respectively. Also noteworthy, the board of directors has approved a 4% dividend increase. Starting with the September payout, the quarterly dividend will now be $0.47 per share.
About The Company: DuPont is engaged in science and technology in a range of disciplines, including high performance materials, electronics, safety and security, and biotechnology. The company operates on a global scale, manufacturing a wide range of products for distribution and sale to many different markets, including automotive, construction, agricultural, medical, protective apparel, electronics and nutrition.