E.I. duPont de Nemours & Co. today reported a drop in first-quarter earnings, but company officials said profits should improve.
The company's 17 percent drop in earnings, however, is an improvement from last summer, company officials said at the firm's annual stockholders meeting.
"Although overall economic conditions remain sluggish, results achieved during this first quarter give us confidence that the company has a strong base on which to build as business conditions improve in the future," said Richard E. Heckert, senior vice president.
The firm was hit particularly hard in Europe, while Canadian, Latin American, Asian and Pacific operations were good, Heckert said. The domestic side "continued to show gradual but steady improvement," he said.
First-quarter earnings were $199 million ($1.35 a share) compared with $237 million ($1.62). Sales were $3.7 billion compared with $3.6 billion. Sales were up by 2 percent over last year because of higher average selling prices. Volume was 6 percent below that of last year's levels, Heckert said. p
Domestic earnings increased 14 percent over last year because prices were raised 12 percent, and there was some moderation in costs of raw materials and energy, Heckert said.
"Our sales of products outside the United States are being impacted by weakness in many European economies, which is the principal cause of the lower volume," Heckert said.
The two-hour meeting, interrupted repeatedly by two stockholders, one of whom was almost ejected, was the last to be conducted by outgoing Chairman Irving S. Shapiro, who has headed the company for seven years. Edward G. Jefferson, chairman-designate, said a lot of the company's improvement will depend on world economic conditions.
"The quality of the 1980s will be influenced by the ability of the collective political leadership to deal with economic shifts and uncertainties, East-West tensions, the energy transition, the fragile politics of the Middle East and Third World needs and aspirations," Jefferson said. "Much can be accomplished, particularly if the Reagan administration and Congress can fashion an effective program to control inflation and to aim this nation toward a new path of sustainably faster real economic growth."
Jefferson also said the company is planning to spend $4.3 billion over the next three years to expand capacity, improve efficiency and introduce new products. The chemical industry has grown about double the rate of the economy in the past, and in this decade it is expected to grow at about the same rate.
"Even with a reduced rate of economic growth, this should mean an average annual industry growth rate of at least 4 percent," Jefferson said. "Some markets will grow much faster than this, including electronics, engineering plastics and life sciences-based businesses such as agricultural chemicals, pharmaceuticals and medical diagnostics."