DuPont To Cut 2,000 Employees

DuPont Textiles & Interiors has taken actions that it feels will advance its progress toward becoming a more competitive integrated enterprise. As part of its drive to capitalize on the strength of its newly combined businesses in response to rapidly accelerating industry structural changes, DTI plans to reduce more than 2,000 employees worldwide, or 10 percent of its global work force. More than two-thirds of the reductions are in manufacturing facilities and offices in the U.S., with most of the balance in Europe. In the U.S., DTI plans to shut down its Terathane PTMEG manufacturing unit at Niagara Falls, NY, and less competitive portions of the spandex operation at Waynesboro, VA.

"These are difficult but necessary actions to position DTI for success in a highly competitive and rapidly consolidating industry," said Richard Goodmanson, DuPont EVP/COO, who is leading DTI. "We must act quickly and decisively to match our resources with current market realities. We are committed to doing what it takes to capture market opportunities while serving our customers with speed and flexibility.

"We do not anticipate a negative impact to our revenue streams as a result of these restructuring actions. We will support our current revenue base from more competitive facilities. We are primed to grow revenues by capitalizing on our strong global market access, key branded platforms and a robust innovation pipeline targeting the global apparel, interior and textile markets."

DuPont expects to achieve annual pre-tax cost savings of about $120 million as a result of these actions, realizing about 30% in 2002 and substantially all in 2003. The company expects to take a one-time second quarter charge of 12-16 cents per share, with about two-thirds due to employee separation costs, and the balance for asset shutdowns. Since plans are still being finalized, the actual one-time charge to earnings will not be available until the end of the second quarter.

DuPont announced in February that it planned to create DTI as a new wholly owned subsidiary and separate it from DuPont by year-end 2003, market conditions permitting. The company is evaluating a range of separation options, including an initial public offering. DTI is the largest integrated textile fiber and interiors business in the world, with approximate annual revenue of $6.5 billion and operating in 50 countries. Headquartered in Wilmington, DTI is comprised of two units, each with subgroups: Textiles and Interiors including apparel, home, industrial and flooring; and Intermediates including nylon, Terathane PTMEG and polyester intermediates, specialties and joint ventures. DTI has a powerful portfolio of the best-known, worldwide brands and trademarks of DuPont including: Lycra, Stainmaster, Coolmax, Thermolite, Supplex, Antron, Cordura, Tactel, Dacron and Micromattique.