DuPont ( DD) posted a drop in second-quarter earnings but reaffirmed full-year guidance.For the quarter ended June 30, the Wilmington, Del., chemicals giant made $975 million, or $1.04 a share, compared with the year-ago $1.02 billion, or $1.01 a share. Revenue fell to $7.84 billion from $8.12 billion a year earlier. Excluding items, earnings rose to $1.01 a share from 90 cents a year earlier. Analysts surveyed by Thomson Financial were looking for a 93-cent profit on sales of $7.85 billion. "Our results this quarter reflect progress in executing our growth strategies and performance improvement initiatives," said CEO Charles O. Holliday Jr. "Our businesses delivered improved pricing, more new product innovations, and again demonstrated excellent cost control. We also achieved important milestones in our emerging biofuels business and in our seed pipeline. We are well positioned for strong earnings growth in the second half." Sales rose 2% from a year ago on a comparable-business basis. Improved local pricing and higher volumes offset a significant portion of higher raw material costs. Fixed cost productivity, measured as a percent of sales, improved 70 basis points versus last year, reflecting an $80 million year-over-year reduction in total fixed costs. After adjusting for currency effects, volume and portfolio changes, after-tax fixed costs were 3 cents a share lower than last year. For the second half, the company expects to earn about 91 cents per share before significant items. This is nearly double the 46 cents per share earned in the second half of last year, which was hit by hurricanes. The company anticipates that continued pricing strength and new product introductions, combined with fixed cost control and modest volume growth, will more than offset higher energy and ingredient costs. The company expects its 2006 reported earnings to be about $2.83 per share. The company reaffirms its full-year 2006 outlook of about $2.85 per share, excluding significant items of $.02 per share. This is 22% higher than 2005 earnings per share of $2.34. "Our first-half performance provides more positive momentum for our company," Holliday said. "While we expect challenges, we are determined to deliver significantly higher earnings in the second half compared to last year. We will continue to rapidly advance and commercialize our technology pipelines and execute our performance-improvement initiatives."