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du pont 4Q08 Conference Call Slides du pont 4Q08 Conference Call Slides Presentation Transcript

  • DuPont 4Q 2008 Earnings Conference Call January 27, 2009 The contents of these slides and web site pages are protected under copyright. Any reproduction, copy, translation or use in whole or in part of any content, graphic or information depicted herein requires the prior written approval of E. I. du Pont de Nemours and Company. © 2009 DuPont. All rights reserved.
  • 2 Regulation G The attached charts include company information that does not conform to generally accepted accounting principles (GAAP). Management believes that an analysis of this data is meaningful to investors because it provides insight with respect to ongoing operating results of the company and allows investors to better evaluate the financial results of the company. These measures should not be viewed as an alternative to GAAP measures of performance. Furthermore, these measures may not be consistent with similar measures provided by other companies. This data should be read in conjunction with the company’s fourth quarter earnings news release dated January 27, 2009, which will be furnished to the SEC on Form 8-K. Reconciliations of non-GAAP measures to GAAP results are available on the Investor Center website at www.dupont.com. Forward Looking Statements During the course of this presentation we may make forward-looking statements or provide forward-looking information. All statements that address expectations or projections about the future are forward-looking statements. Some of these statements include words such as quot;expects,quot; quot;anticipates,” quot;plans,quot; quot;intends,quot; quot;projects,quot; and quot;indicates.” Although they reflect our current expectations, these statements are not guarantees of future performance, but involve a number of risks, uncertainties, and assumptions. Some of those risk factors include economic conditions, competitive pressures, challenges associated with research and development, market acceptance of new products, and regulatory approval. We urge you to review DuPont's SEC filings, particularly its latest annual report on Form 10-K and quarterly report on Form 10-Q, for a discussion of some of the factors which could cause actual results to differ materially. The Company does not undertake to update any forward-looking statements as a result of future developments or new information. © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 3 4Q & Full Year 2008 Financial Highlights $ Billions Except EPS 4Q Change 2008 Change EPS Reported ($.70) $2.20 Underlying* ($.28) (149%) $2.78 (15%) Segment Pre-Tax ($.1) (106%) $4.4 (14%) Operating Income/(Loss)* Consolidated Net Sales $5.8 (17%) $30.5 4% (20%) (5%) Volume 7% 7% Local prices (3%) 3% Currency impact (1%) (1%) Portfolio Chg & Other 4Q08 4Q07 2008 2007 Base Tax Rate 45.2% 17.9% 20.4% 23.9% * Excludes significant items. See Schedule B in news release for a list of significant items. See Schedule C in news release for detailed reconciliations of non-GAAP measures. © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 4 Global Sales Regional Highlights 4Q 2008 Sales Distribution 4Q 2008 Sales Growth Developed Europe Region % Emerging 23% Asia Emerging 9% EMEA Worldwide (17) 6% Developed Asia U.S. (15) 10% Non-U.S. (17) Canada 3% Emerging Markets * (16) Latin U.S. (19) Emerging Asia America 34% 15% (26) Emerging EMEA (10) Latin America *Refer to the company’s website for a definition of ‘emerging markets’. © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 5 Global Sales Segment Highlights* 4Q 2008 Sales Distribution 4Q 2008 Sales Growth S&P Port- Total USD Ag & Segments Vol. folio 22% % Price Chg. Nutrition 21% Ag & Nutrition (2) 8 (9) (1) Coatings & Color (21) 1 (22) 0 Technologies Electronic & PM Communication (13) 1 (15) 1 C&CT 21% Technologies 22% Performance (30) 3 (32) (1) Materials Safety & E&CT (10) 7 (15) (2) Protection 14% *Segment sales includes intercompany transfers © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 6 4Q 2008 EPS Waterfall $1.20 ($0.48) $0.44 $0.80 ($0.55) $.60 $0.40 Reported EPS* $.57 Underlying ($0.21) EPS $0.00 ($.28) $0.09 ($0.07) ($0.04) $0.02 ($0.05) Underlying EPS ($.70) -$0.40 Reported EPS** -$0.80 4Q07 Local Price Variable Volum e Low er Fixed Costs Currency Taxes Exchange Other 4Q08 Costs Capacity Loss Utilization * Reported 4Q07 EPS of $.60 includes a $.03 per share benefit for significant items. ** Reported 4Q08 EPS loss of $.70 includes a $.42 per share charge for significant items. See schedule B in the news release for a list of significant items. © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 7 Strong Balance Sheet Ample liquidity CP Balance CP Rate $4 8% • $3.7B in cash & investment 12/31/08, ~$.3B in CP, $2.7B in Avg Cost of CP Borrowing untapped credit lines $ Billion Low funding cost $2 4% • A/A2 Long Term Credit Rating & A1/P1 Short Term Credit Rating Taking actions to maintain our strong position $0 0% 4Q07 1Q08 2Q08 3Q08 4Q08 1/26/2009 DUPONT CONFIDENTIAL
  • 8 2009 Earnings & Cash Guidance 1Q EPS Outlook Actions $1.31 $.50-$.70 • Deliver cost and capital productivity $1.00 • Capture growth & value; agriculture $0.50 markets $0.00 • Disciplined pricing on science-based 1Q08 1Q09E offerings • Leveraging our leading positions in Full Year Outlook multiple end markets $2.78 $2.00-$2.50 Challenges $3 • Global economic conditions & visibility in $2 many end markets $1 • Pension non-cash earnings impact • Currency $0 2008 2009E 2009 $2.5 Billion in Free Cash Flow Confirmed © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 9 Ag & Nutrition 4Q08 Segment Highlights Sales (2%) PTOI (84%)* $1,400 ($30) $1,200 ($100) $1,000 $800 ($170) 4Q07 4Q08 4Q07 4Q08 4Q08 Results 1H09 Outlook + Strong pricing + Strong global seed volume and price + Seed market share gains in Latin America + Rynaxypyr® sales – Crop protection seasonal patterns – Currency – Growth investments in seed – Commodity prices and continued growth investments – Commodity and other raw material costs Strong Latin American season closes out 2008; Robust start to North American season * See schedule C and D in the news release for reconciliation of non-GAAP measures. 4Q07 PTOI included a $15 million gain from an asset divestiture. © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 10 Coatings & Color Technologies 4Q08 Segment Highlights Sales (21%) PTOI (130%)* $1,800 $300 $1,400 $200 $100 $1,000 $0 $600 -$100 4Q07 4Q08 4Q07 4Q08 4Q08 Results 1Q09 Outlook + Titanium dioxide and refinish products global price + Cost reduction / working capital management – – Global motor vehicle production (19%) ** Global motor vehicle production (28%) ** – – Global destocking Low capacity utilization & raw material costs – Raw material & transportation cost – Low capacity utilization Unprecedented demand contraction hurts 4Q; Continued weakness in 1Q * See schedule C and D in the news release for reconciliation of non-GAAP measures. * * Source: CSM WW Inc © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 11 Electronic & Communication Technologies 4Q08 Segment Highlights Sales (13%) PTOI (94%)* $1,000 $160 $800 $80 $600 $0 4Q07 4Q08 4Q07 4Q08 4Q08 Results 1Q09 Outlook + Cost actions & inventory management + Strong sales of Tedlar® into photovoltaics + Pricing primarily in fluoroproducts – Demand more challenging sequentially & YOY – electronics & fluoropolymers Global slowdown; most markets & regions – Low capacity utilization & raw material costs – Low capacity utilization & raw material costs – Currency Sharp global downturn affects 4Q; Challenges continue in 1Q * See schedule C and D in the news release for reconciliation of non-GAAP measures. 4Q07 PTOI included a $28 million gain from a land sale © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 12 Performance Materials 4Q08 Segment Highlights Sales (30%) PTOI (169%)* $1,800 $200 $100 $1,400 $0 $1,000 -$100 $600 -$200 4Q07 4Q08 4Q07 4Q08 4Q08 Results 1Q09 Outlook + Fixed cost reductions + Raw material price decline start to impact late 1Q + Orange, TX plant site polymer units repaired + Operations/supply chain restoration post hurricane – Weak demand in most major markets and regions + Cost reduction / working capital management – Product availability due to hurricane impact – Motor vehicle demand – Feedstock costs and low capacity utilization – Global industrial demand down sequentially Rapid demand decline; Intense focus on cost and capital * See schedule C and D in the news release for reconciliation of non-GAAP measures. © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 13 Safety & Protection 4Q08 Segment Highlights PTOI (62%)* Sales (10%) $1,500 $300 $1,000 $150 $500 $0 4Q07 4Q08 4Q07 4Q08 4Q08 Results 1Q09 Outlook + Pricing primarily in aramids and chemical products + Nomex® and parts of Kevlar® strong demand – Double digit volume decline in most segments + Lower raw material prices – U.S. construction market faced further weakness – Demand down sequentially in most product lines – Short-term effect from growth investments U.S. housing starts reduced over 30% in 2008; Pressure continues in 2009 * See schedule C and D in the news release for reconciliation of non-GAAP measures. © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 14 2009 Directives Drive Sales & Earnings • Deliver against segment specific targets Reduce Costs • $730 million fixed cost reduction programs Reduce Capital Spending • ~ $1.6 billion Reduce Working Capital • $1 billion target © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 15 Appendix • Industrial chemical prices • Total company volume and local pricing trends • Fixed cost control © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 16 Industrial Chemical Prices Sequential Price Level YOY % Change Source: Bureau of Labor Statistics U.S. Producer Price Index of Industrial Chemicals © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 17 DuPont Sales Volume Worldwide* 120 15 * History excludes 115 Textiles & Interiors 10 110 5 105 100 0 95 -5 90 -10 -15 Yr/Yr % Change (Left) -20 Volume Level 4qma (1999 = 100 Right) -25 00 01 02 03 04 05 06 07 08 © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 18 DuPont Selling Prices Worldwide* 10 120 Yr/Yr % Change (Left) Index 4qma (1999 = 100 Right) 8 115 6 110 4 105 2 0 100 * Prices in local currency terms -2 (Adjusted for currency & history 95 excludes Textiles & Interiors) -4 00 01 02 03 04 05 06 07 08 © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.
  • 19 Productivity Initiative Fixed Cost Control Fixed Costs as % of Consolidated Sales Quarterly Annually 55 2004 Fixed Cost % of Sales 2005 45.2 44.6 2006 50 45 2007 42.5 2008 41.2 41.0 45 40 35 35 2004 2005 2006 2007 2008 1 Qtr 2 Qtr 3 Qtr 4 Qtr Note: Data excludes significant items in all periods and has been adjusted for 2004 to exclude Textiles & Interiors. © 2009 E.I. du Pont de Nemours and Company. All Rights Reserved.