DowDuPont Inc reported a 28 percent fall in adjusted quarterly profit

DowDuPont Inc reported a 28 percent fall in adjusted quarterly profit on Thursday, as floods in the U.S. midwest and sluggish growth in auto and smartphone markets hit prices of its specialty and agricultural chemicals as well as volumes in North America.

Formed in 2017 by the $130 billion mergers of chemical giants Dow Chemical and DuPont, DowDuPont is now in the process of splitting into three separate business units – Dow, DuPont, and Corteva Agriscience, reports Reuters.

Dow Inc, which makes chemicals used in brake fluids and packaging materials, was spun off on April 1. It posted a 24 percent drop in core earnings from operations, in line with estimates, hurt by lower chemical prices.

DowDuPont reaffirmed its full-year core earnings target of $2.8 billion for agricultural seeds and chemicals business Corteva. The unit is set to be spun off on June 1.

For specialty chemicals unit DuPont, the holding company reiterated its earlier forecast of flat full-year net sales and slightly lower core earnings, as it expects demand for cars and smartphones to recover in the second half.

As a combined company, DowDuPont’s adjusted net income fell to $1.89 billion in the first quarter ended March 31, from $2.63 billion a year earlier.

On a per share basis, it earned 84 cents, in line with analysts’ estimates, according to IBES data from Refinitiv.

Net sales at DowDuPont dropped 9 percent to $19.65 billion, and at Dow, it fell 10 percent to $10.77 billion.

DowDuPont said in March that floods had limited its ability to deliver products to customers, while delaying pre-season applications.

Record floods devastated a wide swath of the farm belt across Iowa, Nebraska, South Dakota and several other states, idling ethanol plants, slowing rail shipments of agricultural products and swamping storage bins holding grain from previous harvests.

Dow said it expects to take a hit in the second quarter, mainly from seasonal planned turnaround and maintenance activity. However, it anticipates pricing to start rising sequentially.

Shares of DowDupont were down about 1 percent at $37.06 in premarket trading, while Dow fell marginally to $55.9.

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