In Delaware, DuPont announced that Ellen Kullman is stepping down as chair and CEO — independent director Edward Breen will take the roles on an interim basis while a search is undertaken for a new CEO.
The news came as DuPont announced a reduction in projected 2nd half earnings from $).75 to $0.40, compared to $2.35 in the first half. The company cited “continued strengthening of the U.S. dollar versus currencies in emerging markets, particularly the Brazilian Real; and a further weakening of agricultural markets, primarily in Brazil” as a cause for the shortfall.
DuPont said “in Brazil, where the planting season is in progress, tighter farmer profit margins and credit are causing growers to be more cautious in their spending. The company is experiencing reduced demand for crop protection products reflecting low insect pressure and lower seed volumes as growers are expected to reduce hybrid corn planted area.”
The Brazilian Real has dropped 60 percent in the past year vs the US dollar.
Piper Jaffray analyst Mike Ritzenthaler cited “A rather dismal profit warning coupled with a change in leadership,” and commented: “ Operational Redesign program was not able to offset a more challenging Ag environment or FX headwinds, which was reflected in management’s previous outlook. The retirement of Ellen Kullman has raised again the possibility of Trian taking a more active role in cost cutting or portfolio redesign, which will likely stoke positive sentiment on the stock (at least temporarily).” Ritzenthaler lowered his Q3 profit forecast for the company to $0.10 per share.