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Cs sept 15 final 16

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  • 1. DELIVERING SOLUTIONS. DELIVERING GROWTH.Paul SchicklerPresident, Pioneer Hi-BredA DuPont BusinessSeptember 15, 2011
  • 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 previously published company reports on Form 10-K, 10-Q and 8-K. These reports along with 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 “plans,” “expects,” “will,” "believes," “intends,” and “estimates.” 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: fluctuations in energy and raw material prices; failure to develop and market new products and optimally manage product life cycles; global economic and capital markets conditions; litigation and environmental matters; changes in laws and regulations or political conditions; and business or supply disruptions. The Company does not undertake to update any forward- looking statements as a result of future developments or new information.Developing Markets Total developing markets is comprised of Developing Asia, Developing Europe, Middle East & Africa, and Latin America. A detailed list of all developing countries is available on the Earnings News Release link on the Investor Center website at www.dupont.com. 2
  • 3. DUPONT FINANCIAL HIGHLIGHTS 2010 Sales $29.4 $30.5 $31.5 $27.4 $ in Billions $26.1 $31.5B +21% 2006 2007 2008 2009 2010 2010 EPS* $2.88 $3.28 $2.78 $3.28 $ per share $3.28 +62% $2.03 2006 2007 2008 2009 2010 $1.52 $1.64 $1.64 $1.64 2010 Dividend $ per share $1.48 $1.5B 2006 2007 2008 2009 2010 * Excludes significant items. Refer to company website for detailed reconciliations of non-GAAP measures. 3
  • 4. We are applying our science to find solutions to some really BIG challenges… FOOD ENERGY PROTECTIONFEEDING THE REDUCING OUR KEEPING PEOPLE & WORLD DEPENDENCE ON THE ENVIRONMENT FOSSIL FUELS SAFE 4
  • 5. DUPONT CRITICAL SUCCESS FACTORS Growth from INNOVATION driven by megatrends DIFFERENTIATED portfolio management PRODUCTIVITY that out-performs peers© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 5
  • 6. INNOVATION: INVESTMENT IN MEGATRENDS2010 DuPont Pro Forma R&D ~$1.8B Decreasing Dependence on Fossil Fuels 15% Protecting People Chemistry and the Environment Engineering 11% Materials Science Increasing Food Nanotechnology Production 60% Industrial Biotech 9% Chemicals and Ag Biotech Materials 5% Electronics 6
  • 7. PRODUCTION AGRICULTURE GROWTH DRIVERS Food Production Commodities Goals 70% Prices Elevated/Volatile Production Increase small supply/demand changes to meet demand by 2050 equate to large impacts World Stock-to- U.S. Farm Use Ratios Income Multiple Crop Ratios 2011 Income Above Flat to Down ’09 –’10 Historic Levels rebuild likely a multi-year strong 2012 income outlook processSources: Various industry projections. These are not specific estimates from Pioneer Hi-Bred. ©2011 PHII. 7
  • 8. FOUNDATION FOR LONG TERM AGRICULTURE GROWTHThe World Growth 1990-2011 Impact on World Grains and Oilseeds 2,200 33% Population +34% [1.7%/yr] 30% Income +68% [3%/yr] 2,000 27%Crude Oil Consumption +30% [2%/yr] 24% 1,800 21%Meat Consumption +60% [3%/yr] 1,600 18% 15%Grains & Oilseeds +37% [2%/yr] 1,400 Production Total use 12%Grains & Oilseeds Area:+11% [0.5%/yr] Stocks / Use (Right Axis) 1,200 9% 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Source: USDA 8
  • 9. HISTORIC CROP PROGRESS Historic Corn Yield Progress Historic Soybean Yield Progress Bu/Acre Bu/Acre167 46 45162 44157 43152 42 41147 40 2006 2007 2008142 2009 2010 2011 39 2006 2007 2008 2009 2010 2011137 38 May Jun Jul Aug Sep Oct Nov FINAL May Jun Jul Aug Sep Oct Nov FINAL Source: USDA 9
  • 10. USDA’s ENDING STOCKS AND AVERAGE CROP PRICE Multi-Year Process to Rebuild Key Crop Stocks and Moderate Commodities Corn SoybeansMil Bushels $/BU Mil Bushels $/BU 1,800 7.00 600 14.00 1,600 6.50 13.00 500 1,400 12.00 6.00 1,200 400 5.50 11.00 1,000 5.00 300 10.00 800 4.50 9.00 600 200 4.00 8.00 400 100 3.50 7.00 200 0 3.00 0 6.00 2006 2007 2008 2009 2010 May 11 Jun 11 Jul 11 Aug 11 Sept 2006 2007 2008 2009 2010 May 11 Jun11 Jul11 Aug11 Sept 11 11 Stocks (Left Axis) Stocks (Left Axis) Farm Price (Right Axis) Farm Price (Right Axis) Source: USDA WASDE 10
  • 11. RECENT HISTORY of U.S. CROP ACREAGECommodity Prices Are Economic Driver Deciding Acreage Distribution 2007 2008 2009 2010 2011 USDA USDA USDA USDA USDA EstCorn 93.5 86.0 86.5 88.2 92.3Soybeans 64.7 75.7 77.5 77.7 75.2Wheat 60.5 63.2 59.2 53.6 56.4Upland cotton 10.5 9.3 9.0 10.8 13.4Rice 2.8 3.0 3.1 3.6 2.78 other crops 22.1 22.8 19.5 18.0 17.0 Total 254.1 260.0 254.9 251.9 257.0 11
  • 12. SEED BUSINESS – GROWTH MODEL Growth, Productivity and Targeted Investment Balanced Growth Margin Expansion Investing for Sustainable Growth • North America corn • World class • Biotechnology & soybean growth route-to-market and breeding • International seed • Production • Right Product Right expansion productivity Acre capabilities • Extensions to • Leverage • Global infrastructure new crops technology into new crops • Leverage global support services©2011 PHII. 12
  • 13. SEED BUSINESS Growing the Global Business Delivering Global Growth TODAY North America 2011 Sales growth contribution split • #1 in Cornevenly between International and North Europe • #1 in Soybean America Regions • Growing Canola • #1 in Corn • Oilseed Rape & Sunflower Opportunity Strong Breeding & Biotech Capability Using global breeding Asia advancements, native traits & • Leading China Corn biotech trait optimizing local Latin America Position solutions • Brazil Corn Price & • Growing India & Technology Leader ASEAN • Brazil Soybean Global Infrastructure To Serve Momentum Advantaged route-to-market strategy • Argentina Resurgence and robust, global supply chain 13
  • 14. SEED BUSINESSWinning Strategy and Execution Continues to Deliver Industry Leading Results 2011 Sales Growth Drivers Global Seed Sales* ($B) CAGR 2007–2010: + N.A. volume and value growth Corn Soybean Other Europe price gains and volume + growth on expansion of biogas segment & oilseed L.A. volume, Brazil price gains + reflecting leading technology + Asia volume + Currency – N.A. 4Q 2010 strong comp 2007 2008 2009 2010 2011ESegment sales include transfers 14
  • 15. SEED BUSINESS - LATIN AMERICAStrong Market Position Delivered Growth; Strong Outlook 2010 Accomplishments Latin America Seed Sales • High teens sales growth • Value and currency gains • Growth in corn and soybean • Lower Brazil corn hectares 2011 Growth Drivers • Corn & soybean volume gains • Ag fundamentals, acreage • 2nd brand expansion continues • Technology adoption 2007 2010 • Bt and weed control traits 15
  • 16. SEED BUSINESS - BRAZIL CORN Continued Leadership in Value and Bt Penetration Strong Product Line-up Pioneer Sales: Bt Penetration Summer season % trait distribution of sales Base YG Hx1 "Double" • >85% Bt product penetration in 100 2% 4% 2010 summer season sales 17% 90 • Providing leading technology choices to farmers 80 70 • 2011 Continued strong HX1 70% performance and conversion 60 43% 86% 50 • Germplasm + native gene + 96% Biotech trait approach 40 30 14% 20 40% 10 3% 16% 9% 0 2008 2009 2010 2011EHX1 = Herculex® I insect protection by Dow AgroSciences and Pioneer Hi-Bred. ® Herculex and the HX logo are registered trademarks of Dow AgroSciences LLC.Also change Yieldgard footnote to: ® YieldGard and the YieldGard Corn Borer design are registered trademarks used under license from Monsanto Company 16
  • 17. SEED BUSINESS – NORTH AMERICARight Product Right Acre – A Clear Differentiator N.A. Seed Business ©2011 PHII. 2011 Success is Clear Mid-Single Digit Advantaged Innovative Local Product Net Price Increases Route-to- Technology Advancements Market Share Gain in 3 Crops©2011 PHII. 17
  • 18. SEED BUSINESS - CORNNorth America Corn Business Growth Drivers N.A. Corn 2011 Sales Drivers N.A. Demonstrated Success Pioneer® Brand Concentration of (Pioneer N.A. Corn Market share Pioneer® brand & PROaccessSM)* Newest Hybrid Classes 2011 performance strong 75% including AQUAmax™ drought % market share 50% Optimum® AcreMax® 1 Launch 1st corn rootworm refuge solution in-the-bag 25% 35% 36% launched on almost 4 million acres 30% 32% 0% PROaccess℠ Business Unit Strategy Corn Market Share Alternative distribution systems -25% Converting to Pioneer genetics Providing growers choices 2008 2009 2010 2011Company estimates©2011 PHII. 18
  • 19. SEED BUSINESS - CORNLeading Breeding Capabilities Enables Right Product Right Acre RPRA Differentiates Pioneer Breeding Hybrids Locally to Solve Our Growers Issues IMPACTTM Trials Supports Targeted Drought Local Product Advancement • Drought • Fusarium • Stress Emergence • Brittle Snap Far West • Drought • Brittle Snap • Head Smut • Goss’s Wilt 19
  • 20. OPTIMUM® ACREMAX® INSECT PROTECTION FAMILY Suite of Integrated Refuge Reduction Products: Choice, Convenience, Yield First and Only Integrated Single- Integrated Single-bag Refuge In-the-bag bag Refuge for Refuge for Above and for Corn Rootworm Above Ground Insect Below Ground Insect Insect Management Management Management Launched in 2011 on Almost 2012 Introduction 2012 Introduction 4 Million AcresHerculex® Insect Protection technology by Dow AgroSciences and Pioneer Hi-Bred. ® Herculex and the HX logo are registered trademarks of Dow AgroSciences LLC. Ignite®, LibertyLinkand the Water Droplet Design are trademarks of Bayer. ® YieldGard, the YieldGard Corn Borer design, and Roundup Ready are registered trademarks used under license from MonsantoCompany. LibertyLink ® and the Water Droplet Design are registered trademarks of Bayer.©2011 PHII. 20
  • 21. OPTIMUM® ACREMAX® Powerful 2011 Launch with Momentum Moving Into 2012 2012 Ramp Up Plans Focused on Fast “Triple” Conversion Optimum® AcreMax® 1 and XTRA conversion of Herculex Xtra Optimum® AcreMax® Penetration Premium products on introduction trusted by farmers 75% 50% Optimum® AcreMax® 1 and XTRA 65% ~65% Conversion of Herculex® XTRA 25% Insect Protection in 2012 0% Optimum® AcreMax® -25% 5-10% Conversion of Herculex® 1 Insect Protection in 2012 2011 2012Herculex® Insect Protection technology by Dow AgroSciences and Pioneer Hi-Bred. ® Herculex and the HX logo are registered trademarks of Dow AgroSciences LLC. Ignite®,LibertyLink and the Water Droplet Design are trademarks of Bayer. ® YieldGard, the YieldGard Corn Borer design, and Roundup Ready are registered trademarks used underlicense from Monsanto Company. ©2011 PHII. 21
  • 22. SEED BUSINESS - SOYBEANNorth America Soybean Business Continues Momentum N.A. Soybean 2011 Sales Drivers N.A. Demonstrated Success (Pioneer NA Soybean Market Share Pioneer® brand & PROaccess®)* Varieties Developed LOCALLY Leading genetics with agronomics 75% and disease packages using % market share AYT™ breeding techniques 50% Strong Service Offering Seed treatments, PRObulk® system, 25% agronomy support, financing, insurance 36% 26% 32% 23% 0% PROaccess℠ Business Unit Strategy Soybean Market Share Alternative distribution systems -25% Converting to Pioneer genetics Providing growers choices 2008 2009 2010 2011* Company estimates ©2011 PHII. 22
  • 23. SEED BUSINESS – SOYBEANLocal Issues Drive Our Local Product Development & Advancement NORTH & NORTHWEST EAST & NORTHEAST • Phytophthora• Iron Chlorosis • Cyst Nematode• Phytophthora • White Mold• Cyst Nematode• White Mold CENTRAL • Brown Stem Rot • Phytophthora WEST • Cyst Nematode• Phytophthora • Sudden Death• Iron Chlorosis Syndrome• Cyst Nematode • White Mold• Sudden Death SOUTHEAST Syndrome • Cyst Nematode • Phytophthora SOUTHWEST • Root Knot• Drought Nematode• Cyst Nematode • Stem Canker• Sudden Death • Frogeye Leafspot Syndrome • Sudden Death Syndrome 23
  • 24. LEADING PIPELINE OF INNOVATIONS IN SOYBEAN Building a Stream of Innovation Y Series Plenish TM Pioneer Pioneer Soybeans High Oleic Soybeans Soybeans Soy with Next with Insect Generation Protection Germplasm Plenish™ High Herbicide advancements Oleic Solutions Including Soybeans disease offering resistance same industry produced leading yield using AYT™ with improved System content New Innovative 2012 Intro / 2nd Half of Decade / Varieties Every Year Multi Yr Penetration Offering Growers ChoiceY series contains Roundup Ready® technology. Roundup Ready® is registered trademarks of Monsanto Company. Plenish™ is a registered trademarks of Pioneer Hi-Bred.Plenish and dual mode herbicide products are not yet available for sale or use. Products, benefits and concepts described are subject to full regulatory approval. ©2011 PHII. 24
  • 25. SEED BUSINESS 2012 PRIORITIES Execute 2012 In Line With The Long Term Plan Achieve Global Growth • 2012 seed sales growth underpinned by volume growth and net price gains • Drive Right Product Right Acre differentiator • New hybrids including ramp up of AQUAmax™ drought • Full supply supporting RPRA • Momentum with AcreMax® Family • Extend seed lead in international markets • Continue investing for product and technology innovation • Deliver key pipeline advancements 25* Excludes significant items. Refer to company website for detailed reconciliations of non-GAAP measures.
  • 26. AGRICULTURE & NUTRITION (Ex-Danisco)Sales Growth 8-10% CAGR (2010-2015E) Key Growth Opportunities • North America corn seed • North America soybean & other crops • International seed • Crop protection products pipeline • Food & nutrition products PTOI Margin Expansion • Margin target 19-21% • Gross margin expansion • G&A leverage • Continued investments: • Selling expense constant % of sales • Increase rate of R&D investment * Segment sales include transfers.** Excludes significant items. Refer to company website for detailed reconciliations of non-GAAP measures. ©2011 PHII. 26

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