Jim Collins, executive vice-president of agriculture at DuPont, in an Oct. 25 conference call with analysts attributed the solid sales and improvement in operating earnings to a strong start to the Brazil summer season, where the company’s new Leptra hybrids continued to build on a successful launch. Third-quarter volume increased 4%, with growth in both corn and soybean seeds, he said.
In Latin America, Collins said farmers have turned to a stronger mix of Pioneer’s newest corn hybrids, resulting in a higher net corn price.
Volume and price improvements have helped DuPont generate a 4% increase in corn seed sales so far in 2016.
|Jim Collins, executive vice-president of agriculture at DuPont.|
“This was enabled by building upon our leading positions in high value global markets, including North America, Brazil, Mexico, Southern Europe, and South Africa,” Collins said. “Our growth reflected the strong performance of our newest products, and continued enhancements to our direct route to market.”
During the conference call, Collins also provided an update on DuPont’s three strategic priorities for its Ag business: achieve cost reductions and earnings commitments; deliver the new product pipeline; and plan for synergy delivery.
“We are entering the home stretch of 2016, and are on target for both our cost savings initiatives and our earnings plan,” he said. “Advancements from our innovation portfolio are a key reason for our strong results. We continue to see favorable market reactions in Latin America to Leptra, which accounted for greater than 50% of our product mix in the Brazil summer season, and drove overall price improvements in our year-to-date segment operating results.
“And finally, our integration planning activities continued to progress. During the third quarter, we made significant progress across key workstreams. We have invested the time to ensure our readiness for the merger and plan the organizational structure.”
Looking ahead, Collins said science, technology and consumer demand will continue to change the face of the industry, and DuPont must be ready to adjust.
“Offering unparalleled innovation to farmers and investing in new products is a requirement, not a choice,” he said. “We continue to expect that the complementary combination of our portfolios will enable our R.&D. organizations to deliver growth through innovation at above and beyond what our current standalone organizations could have delivered. Innovation will always be an imperative for our business.”
Overall, net income at DuPont in the third quarter ended Sept. 30 was $2 million, down sharply from $235 million in the same period a year ago. Net sales totaled $4.917 billion, up from $4.873 billion a year ago.