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DuPont says does not see end for U.S. downturn soon Reuters Company News - March 15, 2001 16:57

CHICAGO, March 15 (Reuters) - Leading U.S. chemical maker DuPont Co. , first hit by the U.S. economic slowdown last fall, does not expect a rebound soon, its chairman and chief executive said Thursday.

"We do not see the turn up yet," said Charles Holliday after a speech to the Chicago Executives Club. "It may happen yet in the second half of the year. It's too early to tell."

The DuPont executive said his company closely monitors the worldwide sales of its products as a way to predict economic growth. In September, the company predicted its annual earnings would fall short as the economy cooled off. Many others have since issued profit warnings of their own.

Holliday said the downturn appear to be a broad-based one and does not exhibit any unusual patterns. The company's numbers, however, do not provide any indication as to the depth or length of the slowdown.

"We're playing it very conservative right now," he told reporters. Holliday said DuPont considers the U.S. economic downturn as a "great time to reposition our company for growth going forward."

In regard to the company's pharmaceutical business, Holliday said DuPont is still considering all options and hopes to make a decision quickly so employees are not left wondering what the future holds.

He said an initial public offering of the pharmaceutical arm, like the company did with energy unit Conoco Inc. , is a possibility, as is a swap with another company.

DuPont approved a plan in December that could lead to a spinoff or sale of the pharmaceutical business, freeing it to concentrate on its core chemicals and biotech businesses. Bayer AG Chief Executive Manfred Schneider said Thursday his company is interested in the unit.

Holliday also said he has no qualms about the current levels of the Japanese yen against the U.S. dollar.

"Around 100 (yen to the dollar) would be ideal, but as long as it's in the range it is today, that's a good balance," he said. Holliday noted the company already manufactures some of its products in Japan, cushioning the impact of the U.S. dollar's strength.

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-- Martin Thompson (mthom1927@aol.com), March 15, 2001