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How Did DuPont’s Protection Solutions Segment Perform in 2Q17?



DuPont’s Protection Solutions segment  in 2Q17

DuPont’s (DD) Protection Solutions segment is the fourth-largest revenue contributor among all of the company’s reporting segments. In 2Q17, the segment accounted for 10.80% of DuPont’s overall revenue—compared to 11.10% in 2Q16, which indicates a fall in its contribution to DuPont’s revenue. The segment reported revenue of $801 million—an increase of 1.90% on a YoY (year-over-year) basis. In 2Q16, the segment reported revenue of $786 million.

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The segment’s revenue growth was primarily driven by higher volumes. The segment had mixed results from its different brands. The increased demand for medical packaging and protective apparel resulted in higher volumes of Tyvek® protective materials. A revival in the oil and gas markets led to growth in Nomex® thermal resistant fiber. On the other hand, Kevlar® catered less to life protection markets due to the price decline.

Segment’s operating income and margin

Banking on higher volumes, the segment reported operating income of $191 million in 2Q17—an increase of 1.6% on a YoY basis. In 2Q16, the segment reported operating income of $188 million. However, small gains in the operating income and higher sales resulted in slightly lower margins. The segment’s 2Q17 operating margin was 23.80%. In 2Q16, the segment’s operating margin was 23.90%—10 basis points lower on a YoY basis.

Investors can invest in DuPont indirectly by investing in the iShares Global Materials ETF (MXI), which has invested 4.o% in DuPont. The fund’s other holdings include Dow Chemical (DOW), LyondellBasell (LYB), and Sherwin-Williams (SHW) with weights of 4.0%, 1.60%, and 1.50%, respectively, as of July 25, 2017.

In the next part, we’ll see how DuPont’s Electronics and Communications segment performed in 2Q17.


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