Mr. MIESTER, I don’t think comparing DD and MON performance is as easy as picking a date like 2000 after the Solutia divesture. I happened to stop by the library yesterday and noticed the May 13, 2013 issue of Chemical & Engineering News (Vol. 91, issue 19) on the magazine rack. An article on pp. 26-28 about the top 50 US Chemical Producers during 2012 caught my attention. Of course, I expected DuPont to be somewhere in the rankings and was pleasantly surprised to see they remain the US firm with the largest chemical market capitalization three years running at ~$42B, just ahead of Dow at ~$39B. In terms of sales, they trailed only Dow (~$57B) and Exxon (chemical unit: ~$39B) with ~$30B. I don’t think the data include DD’s Performance Coatings sale, so they should drop back somewhat in next year’s rankings.
Much to my surprise, however, was an entry at #22 for Monsanto (up a notch from #23 in 2011). I thought at first the article referred to Solutia, the chemical arm of old MON separated out as a new company so many years ago, but that wasn’t the case. Solutia is nowhere to be found on the top 50 list. MON’s chemical sales in 2012 were ~$3.7B, representing about 27% of MON’s total sales and an increase of almost 15% over 2011. Chemical operating profits were ~$477M, an increase of nearly 70% from 2011, and provided ~16% of MON’s total profits in 2012. MON’s chemical assets of ~$4.28B represented ~21% of their total assets, generating an operating return on chemical assets of ~11%.
Mr. MIESTER, it seems that the professional chemical analysts who compiled these data think that MON is still a chemical company! Don’t tell Mr. Fun, though. As you know, he always says MON got rid of their chemicals and is now a seed company. You know how he gets when anyone poses an opinion or fact contrary to his opinions. He’s liable to claim those analysts are just DuPont shills in disguise!
You broke a Golden Rule at DuPont, by calling it a "chemical company" (Gasp!) - don't you remember that it's a "high science" company and Smellen lit into a poor ANAL-yst who dared compare DuPont with other chemical companies?
Smellen's funny word "well, you know, actually we're not a chemical company, you know" - RIGHT!
And DuPont has been a great investment since 1998!
If you want to be respected and taken seriously on this Message Board, please come out of the closet about yourself and your DuPont manager job. You've left enough droppings to let even a gumshoe detective figure out what you really do for a living.
p.s. There's a 100% fool-proof way to detect a DuPont manager (or a suck-off like not-that-bright)- they will dodge the question or even lie through their teeth when asked if DuPont is better off today under Chad/Ellen after nuking 50% of the market cap since 1998. Gets 'em every time!
Mr. Fan, I guess it’s lucky I’m not working at DuPont. After all, I wouldn’t want to break any “Golden” rules. If you’ve followed the Chemical & Engineering News chemical firm rankings these past few years, you’d certainly have seen DD there regardless of what Ms. Kullman calls DD. She’s just marketing DD’s new direction. Years ago DD’s assets were essentially all chemical- today it’s somewhere in the 80s percentile as the fraction of Ag/bio assets is increasing and the old line chemical assets are being sold off. As I mentioned previously, MON is still considered a chemical company by the analysts even though their chemical assets are only ~21% of total assets. So, DD probably has a way to go disposing of old line chemical assets before the analysts consider their transformation to a biosciences firm complete.
I guess that means DD should get busy selling off TiO2, along with Kevlar™/Nomex™, Teflon™, Corian™, Tyvek™, etc… more quickly, don’t you? Given how you feel about the current DD management, I’d think you especially would be anxious for divestiture and a chance to move on to a new start with a new boss at the firm acquiring your division. Surely you agree the lower compensation and poorer benefits the acquiring firm will likely impose to increase profitability would be a small price to pay for your freedom from DD’s management?
As an investor, one thing I’d like DD to do differently is complete the transformation away from industrial chemicals to Ag/bio more quickly. As long as they have one foot in Ag/bio and the other in old line chemicals/materials DD will remain a trading stock. Firms transitioning to a new biz line sometimes suffer lower valuations reflecting risks during the transition. It’s unfortunate you apparently didn’t realize that back in 1998 and adjust your DD investment strategy accordingly.
Con’t next post
I principle, what you say is accurate. Monsanto is still as much in the chemic as Dual industry as DuPont is. However, at ~2000, both companies had proclaimed that they were transitioning out of the chemical industry into the "life science" business.
My main reason for suggesting that 2000 be used as a year for comparing value delivery and profitability was for that reason. Personally, I believe that comparing DuPont and Monsanto should not become the basis for a #$%$ contest. If, as a certain rectal cavity named "ZIG". believes, anyone thinks that DuPont or ANY company is inferior DON'T BUY IT!
Also, don't take your hate messages to the DD and other boards. ZIG is not influencing ANYBODY'S decision to buy or sell DuPont or Monsanto. All he is doing is making himself look exactly what he is - a stupid, hate filled, braying SHILL!
Thanks for your analysis! I very much appreciated your perspective