Ms. Kullman Ditches Nearly a Third of Her DuPont Earnings, 20% of Revenue!
Amputating Chemicals To Copycat Superior-Performing Monsanto
THE SUNDAY SIZE-UP
Good Morning, Bonjour, Guten Tag,
Readers, the big news coming out of Fortress Wilmington in the week just past? DuPont's bumbling bosses are expunging what made DuPont unique and innovative for 211 years, in short chemicals. Seems Ms. Kullman, DuPont Chieftess, prefers to run exclusively what she calls "a science-based food, fuel, and protection" boutique. To this end, she is splitting the poorly managed DuPont conglomerate into two poorly managed parts, with chemicals such as Teflon, TIO2, acids, and fluorochemicals dumped into one spin-off. Despite her public pleas of "urgency", the job won't get done for another year and a half. 18 months is apparently "urgent" by the standards of this lumbering, behind the times conglomerate which calls as home the dwarf state of Delaware.
In dumping chemicals, Ms. Kullman is getting rid of nearly a third of her earnings and 20% of DuPont revenues based on the last full year, 2012. That's a fat $1.6 billion in PTOI, or 28.3% of total DuPont PTOI to be exact, and $7 billion in revenue.
To pump up enthusiasm, the hubris-heavy head of DuPont dispatched her CFO, Nicholas FeignandFakeUs to brag to the media, the segregated chemicals unit would be a "strong" chemical company. What? At only an eighth the size of Dow Chemical, and less than a 10th the size of BASF, the amputated DuPont chemicals unit is hardly a major global player, no matter how much public relations fluff is scattered to the winds of the media!
Finally, in frantically trying to imitate the original Monsanto in divesting chemicals, Ms. Kulllman is starting much too late, late by well over a decade. Nor does she have the pool of science or scientists to catch up to superior-managed Monsanto. Investors should recognise the sheer reality here. It's not promising.
Merely the Sunday Size-Up digitally penned by one individual investor and student of the shrinking