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Concentrate on the next generation of the auto industry: Dupont is realigning itself with billions in purchases

The US specialty chemicals company Dupont de Nemours wants to realign its business. According to a statement on Tuesday, Dupont plans to take over electronic materials specialist Rogers Corporation for US $ 5.2 billion. The transaction is expected to be completed in the second quarter of 2022. The cartel authorities and the Rogers shareholders still have to agree. In addition, the group will sell a large part of its unit (Mobility & Materials), which specializes in materials for the automotive industry, it said. The “Wall Street Journal” had previously reported on it.

“In the future, our portfolio will focus on the core areas of electronics, water, protection, industrial technologies and the next generation of the automotive industry,” said CEO Ed Breen, according to the announcement. This would significantly improve sales growth, the operating margin (Ebitda) and earnings stability. Dupont could then rank among the best companies in the industry.

The electronics and industry, which is to be merged with Rogers, made up about a third of sales in the past quarter. The area of ​​mobility and materials also contributes almost a third to the group’s earnings. The company’s shares gave way in early trading.

Targets lowered due to lack of chips

Meanwhile, the company reduced its targets for the full year, mainly because of the semiconductor shortage in the auto industry. For 2021, Dupont now expects sales of $ 16.34 billion to $ 16.40 billion. Most recently, the company had revenues in the amount of 16.45 to 16.55 billion on the list.

Adjusted earnings before interest, taxes, depreciation and amortization (operating Ebitda) are expected to rise from $ 3.4 billion in the previous year to now $ 4.14 to 4.17 billion. When it comes to adjusted earnings per share, the company is targeting $ 4.18 to $ 4.22. Both earnings figures are therefore likely to be somewhat lower than last planned.

Sales increase significantly

In the months of July through September, sales climbed 18 percent year-on-year to just under $ 4.3 billion. All three divisions had double-digit percentage growth, it said. However, there were headwinds from increased raw material and logistics costs as well as delivery bottlenecks for important raw materials. The bottom line was a shareholder profit of $ 391 million after a loss last year. In continuing operations, profits were $ 433 million compared to $ 86 million a year earlier.

Above all, the weakness in the auto industry had afflicted the group in the Corona year 2020. However, the group, which was spun off on June 1, 2019 from the chemical company DowDupont, which merged in 2017, had already started restructuring before the pandemic. Management reacted to the corona burden in 2020 by tightening the savings program. (dpa-AFX / gem)

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Lenny Li

I started to play with tech since middle school. Smart phones, laptops and gadgets are all about my life. Besides, I am also a big fan of Star War. May the force be with you!

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