DuPont Co. (DD), the No. 2 U.S. chemical maker, on Tuesday posted a lower quarterly profit after a large tax gain a year earlier and forecast earnings growth in 2005.

Net income fell to $278 million, or 28 cents a share, in the fourth quarter compared with $636 million, or 63 cents, a year earlier.

Before special items, DuPont earned $371 million, or 37 cents a share, versus 29 cents a year earlier. Analysts, on average, expected the company to earn 33 cents a share.

But Deutsche Bank senior analyst David Begleiter said the 2004 fourth-quarter result also included a tax gain that amounted to 3 cents a share, so the results were roughly as expected.

"I wouldn't expect the stock to do much on this today. They gave fairly good guidance for 2005 that nicely bracketed the consensus," said Begleiter.

Fourth-quarter charges included $100 million, or 9 cents a share to boost its legal reserve after its joint venture with Dow Chemical Co. (DOW) was fined and pleaded guilty to fixing the price of synthetic rubber.

"Higher selling prices and volume growth more than offset higher energy and raw material costs," the Wilmington, Del.-based company said in a statement.

Net sales for the quarter fell to $6.0 billion from $6.5 billion a year earlier although segment sales, excluding the divested Textiles and Interiors business, rose to $6.3 billion, up 14 percent from a year earlier.

This sales growth was due largely to 5 percent volume growth and 7 percent higher U.S. dollar selling prices, which include 4 percent higher local selling prices.

Begleiter said the company's coating and color technologies and safety and protection divisions performed well during the fourth quarter while results from its agriculture unit were worse than expected.

DuPont forecast 2005 earnings of between $2.65 and $2.85 per share compared with 2004 earnings of $2.38 per share. Analysts on average expected 2005 earnings of $2.74 per share, according to Reuters Estimates.

"With the structural transformation of our company now complete, our number one priority is delivering on our three business strategies which we are confident will create superior value for our customers and our shareholders," said Chief Executive Charles Holliday.

DuPont said it expected the pricing momentum created in 2004 to continue into 2005 and emerging market growth to continue to outpace global GDP (search) growth as the company increases its penetration into those markets.

Sales of new products in 2005 are expected to increase to 33 percent of total sales as DuPont continues to introduce new products.