DD - Earnings call transcript Q1 2024 | DuPont de Nemours, Inc.

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Operator

Good day, and welcome to the DuPont First Quarter 2024 Earnings Call. [Operator Instructions]

Finally, I would like to advise all participants that this call is being recorded. Thank you.

I'd now like to welcome Chris Mecray to begin the conference. you. to over Chris,

Christopher Mecray

thank Financial joining Results and First for Quarter XXXX Conference you morning, us for DuPont's Good Call.

Officer. Joining Chief me Financial Executive Breen, Officer; and today Lori Koch, are Ed Chief

which prepared slides. are the We've Relations through the Please and webcast tab supplement contained forward-looking to our statement Investor posted DuPont's disclaimer website slides on under link. read the remarks, in the

and the based forward-looking differ call, regarding statements. our or assumptions about we'll on predictions are statements make performance statements that and future. this materially risks these During or Because actual forward-looking involve uncertainties, factors current expectations from our our may results

Form Our historical presented and today and updated risks uncertainties items. periodic current which continuing exclude are may significant on financial reports, measures a differences. Unless our operations all includes XX-K, cause basis discussion specified, principal as detailed of such by otherwise

other that to comparable our A refer materials presentation GAAP also posted Relations measures website. to directly press is financial will non-GAAP included in to DuPont's have the and most Investor measures. We been release reconciliation

turn Ed. now the to call I'll over

Edward Breen

XXXX and Quarter joining thank for Review. our you First morning, Good Financial

that the results are in period exceeded our confirmed in all the expectations, past Our road on segments. to Broadly, for recovery. electronics first quarter by and better-than-expected bottom the driven the volumes we

our the expected, $XXX year-over-year declines to our earlier quarter conditions shortly. Compared Our expectations. EPS raising businesses, said, X%. We did, first $X.XX slightly have the believe and the performance, underlying both see Solutions, industrial-based adjusted for of in destocking, channel operating growth and That to of given but detail previous volume Interconnect up resulting driven declined with chip Semiconductor reported of further is revenue a volumes sales however, billion we first year-over-year and inventory sales assumed consistent in saw certain will we the we second a expected. In bottomed Technologies declined as levels, growth in outlook in $X.X by demand straight per continue first with inventory X%. quarter business are year of net of timing period, quarter pickup X% reported sales, full sequential year-over-year, adjusted and year Lori XX% XXXX EBITDA, than EPS. customer million EBITDA quarter X%, those and ago recovery also guidance our declined operating share and of X%, normalization

the in total We continue working to and million quarter. this late of in a to delivered prioritize we the our of bringing accelerated April, XXXX. February, million year-over-year during retiring since cash X.X shares outstanding XX% and launched over significant November transaction repurchase capital share improvement $XXX in completed shares flow In share repurchases total tranche

I businesses, X to growth high-growth reiterate Turning around to want Slide areas. that centered of remain about excited X, potential our the we secular

through-cycle about destocking and excited our on of teams continue as our recover strength operational are end headwinds, focus We portfolio markets excellence. the from recent to

process, manufacturing and with is in manufacturing, chip strong Almost sales well and including consumables portfolio serving consumer-based X/X semiconductor our and printed tablets. serving smartphones, films, electronics, exposure PCs, electronics positions used leadership as materials broader via in as used today focused customer displays, circuit markets primarily of on board for relationships the

ICS AI within for over markets Electronics data very the chips electronics course participate products. and mobile end Semi such are and growth products inflected, XXXX. node centers positively expect we volume and pickup advanced in AI-driven applications, in geared We to the acceleration of have key our pleased towards both as via continued semi-related other

the in in evolving have We been markets for bottomed in project strong expected around circularity. last year quarter. destocking response Water and of the to second demand growth, will distributor and at and which XX% and Our of later to range by regulation generate concerns portfolio driven our filtration technologies products, filtration constitutes global begin business water a wastewater the by broad to associated recover believe and scarcity work impacted has slower operates

within end portfolio leadership is protection Tyvek medical biopharma industrial and of medical excellent in XX% the markets growing Spectrum DuPont technologies, care technologies. have about We industrial packaging devices, and geared Within health including positions various to consumables. markets, Liveo

after We to hybrid in quarter. recent water-related electric that second is bottoming ongoing products a see beginning constitutes next-generation base recover auto market and across longer-term includes periods. DuPont's battery, portfolio. technologies, solid for each in trends the and remained has and applications. We expect participation recovery beginning demand about packaging advanced in customers XX% have seen later secular demand demand product is and geared total expected the motor to devices for healthy, Biopharma in Demand vehicles medical global customer later year of excellent sales other see opportunity EV within enabling region. and have auto-related our for advanced to our in we

outlook. it our and turn me performance to review Lori to With over financial that, let

Lori Koch

Thanks, Ed, morning. good and

Our first across further with signs bottoming electronics industrial-based markets. recovery with clearly matched quarter were of results end encouraging our

productivity significant in excellence recent quarters. commitment and flow decremental has cash our margins has helped improvement Additionally, operational minimized drive and to to produce

have will actions and the benefit results last continue Our restructuring to announced from November.

ago sales The in Tyvek's parts Net Safety volume medical and E&I up X%, X%. organic sales Industrial currency China, X%, packaging, volume year markets. reflects a the X%, From Solutions Pacific view, Slide Lower sales Interconnect acquisition. of China, organic and in decreased versus regional due billion by and and for sales X% year declines and These in $X.X increased America destocking volumes while a as partially and organic X% corporate a ago decline price. and X% first offset X% to decrease were XX% by aggregate Spectrum I'll prior most Semi an portfolio X% of perspective, increased declines from W&P a electronics in by X% X% volumes W&P In financial and a organic in X, in continued growth and the where year-over-year Tyvek Solutions, partially cover of Turning water quarter period. On to offset was globally our channel were sales Europe, Solutions, versus for products. inventory year in declined strong Liveo period, biopharma sales versus organic decrease the X%, primarily impact Solutions segment and North a favorable and E&I growth was as benefits down in notably decreased pressure period, headwind continued respectively. on offset driven X%, basis the with than in Water mainly decline more the highlights. Asia sales respectively,

basis offset as versus product lower were earnings was the $XXX impact partially EBITDA of and of the quarter points during X% quarter by First ago the period. volume operating declines down EBITDA decreased costs Spectrum year XX.X% Operating million of XX contribution.

$XXX from with adjusted significantly operations the I cash the significant On Adjusted a million flow cash XX%, free flow quarter, basis, performance. cash in improvement million, a expenditures during year. capital $XXX of pleased flow am quarter resulted of in increase in less as first flow was we year our working of million capital of continuing our the $XXX conversion ahead optimizing versus million focus last on period. free cash operations ago efforts $XXX

more $X.XX the interest a $X.XX higher decreased higher count. X. than share year Turning net quarter from to per EPS earnings, lower for $X.XX and from Adjusted of offset depreciation expense benefit the Lower ago in Slide a share segment period.

quarter tax by the Our up year from rate for earnings. ago XX.X% driven mix XX.X%, was the period, and in geographic

XX% unchanged. year XX% of XXXX base to full Our remains tax rate outlook

Spectrum X% will while focus currency decline Slide volume organic our X. certain of reflects X E&I to on in structure, to business. cost due was a lines streamline of results, with X% also and product The within X% billion lines segment highlight realigned decrease better contribution X% our we customers. Effective optimizing an reporting, sales $X.X prices. certain sales the The offerings partially of sales our first product E&I's by a as with changes metal a beginning sales decrease X% offset that a Turning organic quarter X% net headwind. on to I in and E&I of our of first decline quarter increased price lower pass-through

appendix. provided Additional in detail the has been on XX Slide

Semiconductor the strong demand continued the start of with year overall demand period to semiconductor display for recovery, levels For market OLED XXXX, up due were of along XX% sales and ago quarter inventory versus for the first materials. normalization organic customer Technologies of

as the from were was underlying about the by that volume Liveo impact Organic Interconnect continue gains broad O-rings demand mostly ICS fourth for to low of for expect second quarter volume first We mid-single-digit improve increase markets were our low product channel percent note the utilization to for offset down metals due quarter continue This growth markets. the year-over-year ongoing in the as year, and semi to a throughout within for sales forecasts lower consecutive XXs continue of lines Industrial inventory in that up Solutions, and exit to to sales rates quarter rate to XXs. Within Solutions Kalrez semi biopharma destocking primarily the organic electronic saw we fab prices. recover. slightly to XX% were call our

order second in see several expected next to also our half. business biopharma to later in continue We quarters over business. our the the is Liveo improvement recover to Kalrez expect still And

contribution the Solutions. year Semi by million Solutions and X% Industrial in driven E&I Operating the versus earnings offset volumes $XXX Interconnect in impact the from Spectrum, by partially of from EBITDA and of was up ago strength period, lower

notably decrease medical We quarter $X.X at Safety down billion driven lower sales to ago period inventory Solutions, XX% were destocking, medical packaging. a Tyvek versus X. a point headwind. close packaging Tyvek the to in volumes, for due currency sales Within inventory normal is net first by customers' W&P X% to most volume our low and Turning believe products. year on this channel mainly teens of for XX% Slide declined organic

down by in and Within Water, lower industrial destocking mid-teens, were sales China. distributor demand organic inventory driven

quarter. decreased impact by product for were W&P of due XX% will to the with to of lift during and our Solutions orders quarter have year towards in an basis the organic the distributors partially $XXX compared period, end we on expect the to million the offset continue active and believe second costs. quarter. Shelter lower second pick sequential communication We lower ago up flat EBITDA volumes, Operating of the

our Slide expectations as quarter. X, the as guidance full for second to I'll Turning XXXX our well an on update year provide

of our EPS which EBITDA, ranges growth. the operating full We year earnings adjusted year-over-year net provided, sales indicates of raising expect $X.XXX operating midpoint and the a share, billion, EBITDA year expected now and $X.XX full for billion, we net about At guidance adjusted are EPS. now $XX.XX of of about revised sales,

lift growth we and per assumes in the of about packaging. Year-over-year and of EBITDA reduced PCB and recovery, destocking of further operating $X.XXX improvement earnings half, the XXXX, water full million a fab our continued in is favorable in share. net For W&P. in expected earnings including medical rates quarter $X.XX with within sales sales expect The electronics impacts by $XXX sequential by seasonality driven billion, EPS to to of second volume recovery, embedded driven semiconductor return in quarter the both year along growth about improvement be market second second Shelter, and ICS utilization and volume sales continued guidance, adjusted electronics and and in

Second both volume as benefit. as drivers well include half earnings expected improvement mix

With back Ed. I'll that, it to turn

Edward Breen

which sustainability. expectations and There to earlier to and strategy: customers' innovation; were team year. On improvement for X Scope and We with delivered emissions to Scope I'm few pleased of Samsung in pleased ESG, waste, our sustainability operational work dimensions the past sustainability across as XXXX metric we for the to year expected development accomplishments. More of Partner best-in-class ESG from aligned we the a a XXXX are our goals. year, Best commitments communities. reduction our in drive empowering also our a a the strong planet; goal. This are mention our aligns recent road in note recognized than standardized the designed XXXX sustainability deployment our to Scope and to tools, advancing our technologies, baseline company-wide and strong of by map. continuous of performance, meet annual people be for ahead with with with is to portfolio our exceeding This climate, this record safety. report product advance awarded made that speed a week, improve I'd our like of both like customer commitment minimize innovation Related and This surpassing just goal is global progress published XXXX aspects a highlighting X XX% us that Paris Electronics, to workflows, productivity, of all and Accord. protecting which and I'd critical XX% our employees X in progress year the are past employees we including XXXX Lori. our performance And this of past excellence this, XXXX another we of reduction the our we Thanks, practices enhance in we ambition achieved year, achieved XX%. goals, a baseline, XX% gas from on was framework contractors. safest that errors, continued emissions, greenhouse XXXX and X of reduce deployment this which

many Finally, These policies focus of sustainability in on just teams and delivering are from Responsible A the new XXXX with remain Supplier strengthening great performance committed driving our Supplier strategy our few a to purpose key in governance underpin reporting how sustainability. Code DuPont our examples in our with practices Board. we our of on strong was as oversight report of program. the our the Conduct are our transparent

are that, and questions, we to to back to take With let pleased the turn Q&A. your open the operator me it

Operator

Instructions] [Operator

Vertical first the comes Jeff question Your Partners. Research line Sprague of from from

Jeffrey Sprague

trying see the protracted bottom is question minimize decrementals here. work my in the And declines. of really, to and Ed, good volume this through lot of did you apparently of nature margins a protect to period is hard

line heading about a maybe I way, other we if the your is think to that know, you we're wonder perspective bit about And that the as back Now come I any just give the you feel costs punch on of us costs. just how going guidance in volumes little other need or structural incrementals could way don't on, E&I.

Edward Breen

Jeff. Yes,

place. is as million savings stay along would XXXX, about cost cost the say, I out end we side, be about that in bit say And would it in the back million we're this and which $XXX will that did probably $XX of we the announced $XX get actions so cranking we'll of $XXX So the we of bulk of markets, November, though, took, on in it. them kind really into the of and million out of of I year. $XXX would where footprint get little bring cost you a there, all million factory be or we'd will cost, our million

XXX% on so 'XX. Incrementals, of improvement benefit, that of potentially year-over-year it -- give our because plans headwind in A in little not for maybe rate. year, we didn't little bouncing be won't out different, bit remember, bit this in the won't on XXXX and of from year that pay comp maybe but sales that we start second the some probably probably comp in bonus be XXX% as obviously, last that could here, a we be half certainly back the there, year, get absorption us, and just 'XX, XXXX, our you because

derisked think, to of planned the are Jeff, incrementals around also now of off Our we've of I the we're year And now. with the baseline in second be working the the second year. XX% half half

million have in to X%, only second to EBITDA half, and about That is to first XX%. our $XXX We ramp half planned XX% you sales is ramp gets to guidance our incrementals. in which

think it's from significantly where were. I potentially So we derisked

Lori Koch

Yes, and half. the first is half, XX% second

basis XXX first at nice guide, margin a implied we you head the our it is low XXXX. XX% half up second is the If points profile half the which versus in as into almost range, the look in tailwind in

Edward Breen

just business quarter XX% out, to always electronics Yes. bouncing EBITDA like consistently, at margins. And nice. in, quarter is Jeff, because brand other maybe one that back the We've XX%

little they're we'd a great with EBITDA a pressed average. just the Spectrum the margins it's than lower in because there, but business bit Going forward,

brings like it EBITDA we XXX cranking run able XX% points. said basis back having we're we that, as it business should be But down So margin to into XXXX. get that like as at

Jeffrey Sprague

and going about over on business. your the or question And naturally kind the these to other of down do avoid about more the the being and of follow-up nature price just think market places price portfolio, in Great. But of of how electronics you of like ability things Semi when also, in the to to a in feel actually, -- going margin that's it E&I we sort into parts price you play time, down of over businesses? the think some sophisticated time maybe get calculus

Edward Breen

mobile Jeff, there. by Well, you always of over more the into be that, more advanced as advantaged X%. MSI Yes. usually, so what with XXX That's really Having set way, of significant. to portfolio it's And this we've AI the then next all the the outgrow down to how at the know, down is devices. coming, not basis and we XXX said kind price nodes by is of moving going and years AI That's points. we're averaged

just more the we of there, that business perspective, helps the that electronics. So we but as price more from platforms have skews margins advanced our in also mix get on a

probably that that, more but little So laminates a side. got stuff price, are all chip think lose lose still do PCB ICS displays That's the to price. and we'll I our little a the on better bit of will and we'll

Operator

of line question Steve next the Your from Tusa comes of JPMorgan.

C. Stephen Tusa

but you said a is I think guide. EBITDA quarter of -- the first or second sequential guess little there quarter. that, -- more is of your a anything And good like a kind guys forward little the conservatism? off first like lower the that you than Was just the I mean, quarter pulled changed in I This bit view? EBITDA expected that the anything X%, on X%, that out first had quarter, quarter-over-quarter bounce XX% takes

Lori Koch

of was it the a more QX. overdelivery think I No, Yes. of reflection

to $XXX got roughly so million. we originally, we of QX lift, would XX% you $XXX said sequential to a million when were guiding So have

to a that still expectations mutes ramp the $XXX gave February So back had million, $XXX number. in $XXX actually million no, at the that bit, but we million little are delivering upside so the now versus we some original we when the

C. Stephen Tusa

Okay, obviously, than electronics is expected? anything that worse And makes have coming really is you sense. would nicely. that is like a little It seems along there

The other as standing as on anything the would the And that just expected sticky Industrial have of stuff coming not on is Industrial out may you be a recovery? along more little businesses kind side.

Edward Breen

because Water said clearly second, water. that pretty we of as last sequentially first to but bottomed will the be we much it's mostly out way, seasonality, quarter. X Steve, our going already of they're in our up orders By and China Shelter to to business had over had of manager towards just in saying end the more the they're back this quarter. last start weeks, placing

our haven't change and year, calendar we the same. Same And the more business care X the -- they from they're the recovered bottomed, business, Biopharma on of yet, looks this this are quarter. towards is Kalrez said way, beginning with but that feels our looks no is packaging before the like like by the of back that So medical half delayed recovery. next second end a of health what the half quarter, business only but

way, So X% one other year in had through spot and China. last been line. By the China growth pretty bright much growth negative the in in we on I liked, had we

the market And predominantly way, the up been the So E&I business quarter. for China in slowly first back up in X% that in that XX% by electronics were because was we has turned, turning us.

sales about not China And that in multinational. same nicely turned about customers China So at our the rate, XX% local ordering us. -- customers, growth, including semi it for about the that's were was semi

see. So good to that was

C. Stephen Tusa

for guys? these price less last any updates Okay. quickly, it's there? you but then just know important on I days And spread raws any update

Lori Koch

year QX hold a that little the partially have we the to did believe QX contributed more than we favorability that in for what we beat. will Yes, saw

the about or So look it QX million on beat, if $XX was on million then at earnings. revenue so about you $XXX and

volume, obviously, primarily we spread. So got and outside better upside was some of there price/cost that

Operator

Scott the Davis of Melius Research. question comes Your next of from line

Scott Davis

materiality a hard content have it and when enough Does idea you be get E&I. don't but us the Ed, slight of a think do it But positive? row is new data rate, growth benefit such that's cannibalized and understand This to and needed. in ask your there going define out of explicitly, to Help center X-year to AI a be of raise the you. couple designs you've about quarters chip may mentioned Or chip product know, think, no structurally so the perhaps, kind stuff a I period? call you I'll nets I it, over, and in just

Edward Breen

Yes.

center Scott, growing million XX% data of -- of exactly, it into the but right here is of so now, size revenue And a next about super to -- that is million over do I north the of going remember, that look, our the it's in we're million of to AI. it's And AI $XXX ballpark, think hard about $XXX the and now, that kind is tell of down all us for think AI So semiconductor is base. AI-specific. that decade this your everyone push I going cycle And into because $XXX devices.

the of up. coming mix, market continue got up market. My XXXX. And would to low exit imagine think XXs. so the and going gut we're for is than to But the by tee chips, single-digit should low for high then really year, got that AI cycle to get broad-based pretty year in the middle exiting rate. growth in really want XX% way, is we're XXs the And it that margin a digits XXXX. but So by yet to the grow a help in growth the to expecting to I low of it's and be higher it's it's probably us -- in going high starting that forecast going fab into business next a our And XXs, I utilization long I year, single the business don't to is us next grow here north the in year E&I nice XXXX, because a would give

Scott Davis

Okay, sure. so for material

not to minutia. Solutions know or I don't it's So -- prebuy bit sort there was what weird so ended little of caught channel up I a it just extra down macro the a there mean? inventory? some little Is want with But that sort But Water on to the in it's excess of, little in folks call China. customer because not turned some sideways up that's it stuffing, a with I much in purely inventory? just was a there behaviors or that, back

Edward Breen

Yes.

So it to it Scott, know wasn't one customer, just don't meant way. that you if clarify. I

We have...

Scott Davis

No, I mean didn't it way. that

Edward Breen

our distributors, have distributors do don't but We We many that bulk of the main that business X do a China do lot we business, in direct too. by the way. direct of

their again, were I what what mean, down. not long just rate, some They higher if of I X working obviously, inventories the kind about looks like end had other -- it's team the destock. And ordering of as is industrial they with there the here destocks. and verbalized at this think a X, past to of back destock, ending through of go down. way, quarter, as by a us, at months production to it week the It this slowed they our was them was is

we we're to there. pretty here. picking good the in into start the expect going And start coming orders quarter we kind third June in timeframe again, shape So think up in of to

of Scott. more would guess, it's I the So I macro, say,

Operator

question from John the Roberts comes Your next Mizuho. of of line

John Ezekiel Roberts

X% they've some were actually, got which update could Tedlar. sales probably they'd exposure us thought like there, on auto But segment Maybe me. Lori, up and corporate give an year-over-year. adhesives What's have I your for in would weak. you one be Industrial going there? on multi-base was Just down

Lori Koch

Yes.

to on EV continue see of auto. we the So side strength

right you So side. as mentioned, EV within a had builds the are there's now, but lot auto weaker overall of still upside

year. expect was to space, and in so that upside Tedlar, of the nice up came had the volume we quarter in photovoltaic really quarter is quarter. lot organic the within that digits for us from in for the the gave So the that X% volumes Tedlar the we double stay the in which A

Operator

comes Your Wolfe next question Parkinson Chris line of Research. the of from

Christopher Parkinson

ICS on to want Just turn side. the

at market sophistication time, versus in the And increase Chinese handsets. know everywhere. of of OEs also Chinese a Asians. seen have share you've I bit the between a same and shift the an And seen you Americans You've exposure Northeast the

terms content throughout the that So can about parse through you kind of should think where thinking exposures relative 'XX that business is be in Street and should the right and about and here, right perhaps just recovering of how how we your now 'XX? market

Edward Breen

Chris, -- just the utilization the to kind we'll the of in in second high the of maybe the go the the way, the rates normal, of low first rates run give never exit way They kind mid-XXs. for XXs. I'd PCB XXs XXs. And of year, year in half by level the the kind kind all in be low year, utilization if low PCB you is middle like XXs, mid-XXs. do. down they're the that the We in back In last of in we think you, the were of quarter, Well, the semis

kind here the of over out can that of of next see year. you So progression plan kind the

Lori Koch

Yes.

quarter, had metallization We the volume and continue a nice with we've that more we on have to of gains to And see lift the maintained wins the other some in of space premium seen circuitry the in rest the both first within that on side, side year. PCs be smartphone side the so expect device space for we then and outside the the and share as fulfillment others. well

Christopher Parkinson

op question a with inclusive there favorite a of Lori, is takes, and Got obviously, you on I bunch few destocking. quarters, over the just terms the as But been know leverage, put latest so forth? of can help throughout on efficiencies, mix, that how the us us 'XX, margin and so progressively optionality the improving greatest you in give you're on and long-term thinking have of W&P last mean, follow-up it. my about margins.

Lori Koch

still margins XX% that in We W&P see for Yes. the range. entitlement

that of are so they've just done mix comes a then impacting down. We've larger but controlling costs volumes lot nice side. function And hit of business that low been really lower the assets it. the as There's to take that the the job quarter, And a decrementals a levels, first the to impact is from know, the heavy a in challenged volumes. when you in minimize

So the improvement medical the that quarter the on, start and we Tyvek of resolution because to as back head going of that's this is expect end then destock we packaging down here at to primarily business into the half. see

nice you do second And improvement to half, so those X wane, see we when half. first start margin see items

about margins the we probably the half then half get we see will at up points back first of that the basis them year. And to as stay level. XX% So ticking XXX

Operator

David question of the next Your line Begleiter Deutsche Bank. of comes from

David Begleiter

guidance year early full that the it's demand by in more back you or on are amount still beat. raised Is only you Ed, a the the because the half QX little year environment? the cautious of

Edward Breen

no change It's as on the said on thinking Yes, good the earlier, derisked the I in feel ramp I just year. our back we've David, half.

So about it up don't a bit any being ends different hopefully, little feel conservative. I it. And no,

David Begleiter

good. And PFAS update you can us another just Very now? on provide right

Edward Breen

Yes, coming nothing thing Stade a next don't the that AG we would the event. -- be The is up want that XXXX significantly new will there, is I settle to David. cases. think

event. set. from it's couple probably we that more had action. class the will It's And we separately I then a a states there's think of locations of XXXX settle where

year. two or those during this I So see of one might get calendar you think maybe settled potentially

that's it's So where at.

The about when it, with the X% very the was settlement, I off firefighting to the of water of became the then by in X/X the X%. way, news and DuPont, total the of And it what consortium DuPont's that And litigation totally that exposure. that to exposure X% signed clear Corteva, I is think, the foam that about other by to written think and now. the comes done remember, of is nice X% it Chemours the the judge. settlement is good districts all David, the thing done, is

are we settle in as So think that I to other these be what numbers helps going box the cases.

Operator

Your of Leithead the question comes of next from line Mike Barclays.

Michael Leithead

First question well seems ask I in declines say, it's I like to wanted few wanted W&P, about quarters. I'd the past to ask price. despite on volume holding double-digit in, fairly It

relatively as price? Should expect expectation we through year? So we for what's the your stay to this flat move

Lori Koch

Yes.

you business Shelter X% in a the as yes, have W&P on really throughout have mentioned, or in job, we year, to delivered the give quarter. some in primarily X%, price, price. We overall, nice as we the to go So done flat had expectation holding back but we still

Michael Leithead

then is expectations? relative Spectrum it. initial your how Ed, And helpful. That's performing Got bigger picture, to

Edward Breen

area Right good. through key destock, I told also major going pretty basically that company, business we've watching really medical on the It's was and go a -- we've so device which that this through is close. we ramping way, there's the we the and significant, going you customer. told a ramp before, that's had ramp ramp very was our And ramp are of they It's significant that also. nice one we very what see that is been were by And the on -- a with -- was to they one nicely but growing Board. with are on not think track it a is -- more to nice we manufacturing

it's business a So the it's our and about area as portfolio clearly Liveo that. And packaging, percentage business, we our Tyvek of medical feeling the prepared really now, remarks. in nice good Between an mentioned like. Spectrum we

XX% stable in end be it's end and market with market, the just and a rate. to steady solid company, So it's nice a growth of very

So we're really liking that business.

Operator

comes of Your question line Spector Josh from UBS. of next the

Joshua Spector

about could kind you rest talked through no talk M&A. your the about you if versus M&A of expectation and September think Can in wondering of period. I your was through on capital you extend year in this terms total allocation? that know about maybe 'XX of buybacks XXXX I the

Edward Breen

this any health the planning amount we're There's on what looking call would big. opportunities size. to we Yes. I'd fair anything care to We're add platform. there. not love do more a -- the I tuck-in not If in would of it's tuck-in I We would at one, think we -- year. think when so acquisition

I could So mean, year, do not plans. it's our possible we but in really one this it's

and -- we just have team Lori on team, we ASR that our through I all destock. was Our deck operationally for have completed were going one hands million the still the area. that We an is And $XXX the as ASR. outstanding said focus

or obviously, depending big a more I where pretty will after And multiple should a some have our acquisition. not tuck-in repurchaser stock stock then our plan be. mix on of when do doing I've is, We that, where always price that, And I we this share one our to so been would think, feel nice year. be is it

in there. think any thinking don't you'll change our I see So

Operator

the Sison Your next comes Wells question from of Michael of line Fargo.

Richard Garchitorena

Richard Mike. for on is This

year you guidance an the of how to year-over-year third wanted second at to the end, just full expect I So in we are the of starting terms the in volumes quarter? Or destocking ask in terms should looking for of in you're volume seeing and what demand half the growth coming year? and

Lori Koch

was XQ volume that just return It guide be volume a perspective because the both from we quarter in half. we last will second a growth to earnings the you growth comp as In But to XQ, the XQ half. ramps we go yes, from see second our returning weakest year. do Yes. gave, and a to really in

Richard Garchitorena

about find China terms more recovery, can Water it's but Or Okay, you China, guess in your than better in saying do was you on the great. recovering And comments Solutions industrial because that E&I? to what just I then weak thought? that specific maybe talk of on you you're side demand if remains you're seeing

Lori Koch

No there. change Yes.

the in was saw we in primarily that China uptick quarter first E&I. So the volume

of We we mid-teens up that's As in see W&P for China. do volumes the mentioned, impacting I still are space. weakness kind had water industrial primarily in

a sequentially able then and the to that a you in half. to be ramp the distributors Water into this the ship So as end those no expectations change our quarter see further second key will of ramp orders the we in towards get from to and head

Operator

Mitsch the of of comes question Research. from Frank next Fermium Your line

Frank Mitsch

up could in question. cash for XX% I if are a flow You flow conversion is free XQ. What free follow What your on XXXX? expectations? did your expectations cash Lori,

Lori Koch

Yes.

I think our or than target XX%. greater of we'll at be near

a pleased reflecting the last were bit in which our of with biannual payment from the expect really was around year, do down really QX, of I a we So dip sizable I XX%. was improvement little QX XX%. to of performance where a take That's interest expense.

So in and May that's about $XXX million. We November. it in pay

expect nice cash see conversion target. we'll But year for QX. I deliver headwind around overall, really it a flow free So the the in to

Frank Mitsch

XQ. how be The year-over-year negative X% seeing in to beyond Terrific. And down flat year-over-year Are you're progress especially has China. organic in decline -- the Asia, on deltas that comp? the multiple you up progress to and or XQ anticipating in that commented times of been Ed, you in lessening in terms

Lori Koch

Yes.

overall both currency and expect China and flat for volume We headwinds about be the year. to price

overall, currency So about was QX with up in were we volume. had mentioned it the flat But the headwinds. in you numbers, as

improvement an that and we yes, goes see expect year as in on. headwinds So to volume some currency the

Operator

Your next question Stephen comes of America. of from of Bank the Byrne line

Steve Byrne

flat. the The segment had is X-year losses of the stack gains volumes X last offset in you essentially and quarters The on & over X kind volumes in flat in 'XX. XXXX Water or Protection your

now? just you visibility Or a underlying that that volume inventory just that that. question about were did that might So destocked And losses in have segment? products growth? Do you on that some generic to modest see be do there you -- been as suggesting think levels those have

Lori Koch

by has the been I impacted I lot a COVID. Yes. think history mean,

a of when into a then peers general moved So an benefit most we XXXX out there we through the from transitioned saw perspective. sizable not unwind, garment that, that the the destock. that we unwind saw once And saw of the timeframe you garments run-up were the industrial during unlike then

think we normal look volume in volumes expecting off low growth read more XXXX into right macro. of the that a need on we're business. And really XXXX good So to to I to in get mid-single-digit now, a

around concerns able just COVID in be the beyond that the to efficacy the those So those to It's market. see overall true destock of getting then and products profile chunky no business. one-timers growth broader industrial of really the around

Steve Byrne

are both Kalrez these And and Tedlar, then

products. fluoropolymer

you Do issue? customers going to wastewater own to a And that I'm just from else are something to any saying, Just switch you avoid products? are managing the fluoropolymer of have question the manufacturing your for how you on those that.

Lori Koch

commitments up fact, actually maybe side on around. so there some mean, seeing PFAS-free, earlier around or in the It questions be there from customers, know I Materials as sustainability in our the we around side No. well is our opportunity There's I in the a and obviously, pick and this there's back examples Advanced Tedlar, opportunistic. report some that of PV share overall footprint. lot to And published drivers as we're to directly key water a just some week. sustainability

Operator

our Laurence Jefferies line And LLC. question Alexander from from comes of last the

Laurence Alexander

you expand additions? see Just do one a to that growth far on business? how it you can round do of CapEx you significant quick trajectory before How the Or electronics the side. need for a much

Edward Breen

than they're into The More which side, the W&P Laurence, on Yes. equipment. our good by different assets. our the is heavy on goes news testing side, side, very CapEx E&I way, not the actually of electronics the

regions We to have testing in equipment are. state-of-the-art have the where very our key customers

over electronics And so we kind the add that's CapEx locations. we'll But where modularly some can time. of manufacturing upgrade

be is that's spend coming this CapEx see a gut super at side. we'll work kind going So here expansion of be not some big my we semi on as cycle to the looking for us. But

like in million. that over ] our test of Tyvek if the which have runs We've very first already anything by don't way, as Luxembourg. that's $XXX on So the product, were project our way, We was gone we're this -- the that Lynade side. business, [ like but you has done launching know, by electronics well,

So upgrade, also quicker the and that's in the to manufacturing side. it's good capacity electronics

we'll see So top next stay over to years steady on growth we this come. the of as that

Operator

back There so like are at call no to Chris further hand time, this questions I'd the to Mecray.

Christopher Mecray

joining Thank website. call. the interest. Thank you. the everybody, we'll This appreciate as call. concludes Okay. for you, IR copy the your We of And post on transcript the always, a DuPont

Operator

conference you Thank our for participating. conclude does today. for That

disconnect. You may now all

DuPont de Nemours (DD) 1 May 242024 Q1 Earnings call transcript