DowDuPont Inc. shares fell on Thursday, Feb. 1, after reporting a loss of $1.26 billion for its fiscal fourth quarter.
The Midland, Mich.-based chemical producer posted a loss of 54 cents per share. Earnings, adjusted for one-time costs, increased 41% year over year to 83 cents per share, beating estimates of 67 cents per share. Revenue of $20.1 billion also topped forecasts calling for $19.4 billion.
For the full-year, the company reported adjusted earnings of $3.40 per share on revenue of $62.5 billion.
TheStreet's Jim Cramer, who holds DowDuPont in his Action Alerts PLUS charitable trust, said it was a blowout quarter for the company, but the guidance for the agriculture unit is giving investors some pause this morning.
"In the first quarter of 2018, management expects that Agriculture net sales and operating will be about 45% of the first half's result, and we view any concerns in this business as overblown," said Cramer and the AAP team, noting that the muted sales guidance is due to a seasonality shift in crop protection.
DowDuPont stock tumbled 1.6% to $74.35 at 12 p.m. EST.
The newly-combined company, formed by the $130-billion-merger of Dow Chemical and DuPont in September, said it is planning to save $3.3 billion in costs, an increase from $3 billion, on the back of the merger. During the quarter, the company achieved an annual cost synergy run-rate of more than $800 million and more than $200 million of realized savings.
But DowDuPont is moving ahead with its plans to split the new company into three separate parts, Materials Science, Agriculture and Specialty Products.
"We also are making significant progress standing up the intended public companies, which we now expect to spin about 14 to 16 months from today," said Chief Executive Ed Breen. Materials Science is expected to be spun-off at the end of the first quarter in 2019, while Agriculture and Specialty Products will follow around June 1, 2019.
"Based on his history at Tyco International, we have championed CEO Ed Breen as a value creator and a 'breakup artist,' and our longstanding thesis is that Breen will deliver results for shareholders better than expectations," wrote Cramer in a Feb. 1 note Action Alerts PLUS subscribers.
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