By ALEX DOMINGUEZ, Associated Press Writer 59 minutes ago
DuPont Co. is cutting 1,500 jobs and consolidating manufacturing in its agriculture and nutrition division, and the chemical company said it will put the $100 million in annual savings into its seeds business as it steps up competition with rival Monsanto.
The changes announced Monday are expected to affect about 10 of the division's 250 sites worldwide, but DuPont spokesman Doyle Karr said the company was not disclosing which sites would be affected.
"It's a commitment that DuPont made earlier about realigning its resources toward high growth opportunities, so Ag and Nutrition is looking at streamlining its low return activities and low growth areas and then investing those savings into high growth areas," Karr said.
The changes include the closing or streamlining of the manufacturing units, with most of the changes expected to be completed in 2007, the company said.
DuPont expects to book a related $200 million pretax charge in the fourth quarter to cover the restructuring.
In a separate announcement, the company sharply increased its fourth-quarter earnings target to reflect a series of tax gains that will more than offset the restructuring charges.
Wilmington, Del.-based DuPont said it now expects to earn $3.25 per share in the quarter, including $370 million, or 39 cents per share, in net one-time gains. The previous estimate was for profit of $2.86 per share, including a gain of 1 cent per share.
The $370 million includes a gain of $500 million to reverse tax accruals and tax valuation allowances, and finalize taxes related to the return to the United States of profits earned abroad. The amount also includes a pretax gain of about $60 million related to insurance recoveries.
Karr said the $500 million was money the company had set aside for taxes. DuPont plans to report fourth-quarter earnings Jan. 23.
Shares of DuPont rose 54 cents to $47.44 in morning trading on the New York Stock Exchange.