Dow Accelerates its
Transformational Strategy

December 8, 2008
SEC Disclosure Rules
►Some of our comments today may include statements about our
 expectations for the future. Those expe...
CEO Priorities – March 2006

► Drive Basics strategy for competitive advantage
► Preferentially invest in Performance/Mark...
Dow’s Transformational Strategy


         JOINT
         JOINT
       VENTURES
       VENTURES                           ...
A Powerful New Dow
                     2/3 Specialties
 Feedstock-Driven                                          Market-...
A Powerful New Dow
                     2/3 Specialties
 Feedstock-Driven                                          Market-...
Actions Announced Today

► Eliminating ~5,000 full-time jobs

► Closing 20 facilities in high-cost locations

► Divesting ...
4Q/08 Restructuring Charge

►Estimated $700 million pre-tax charge
   – ~$350 million severance
   – ~$350 million asset-r...
Total Operating Cost Reductions
                                                                                  Year-End...
Lower Cash Requirements Through 2009


► Working Capital Reductions                                       $2        Billio...
A Consistent & Reliable Dividend

     ► A 96-year history of consistent dividends
             – Maintained or increased ...
Summary – Key Messages

► Transformation to an earnings growth company accelerated

► Three different operating models sup...
Dow Accelerates its
Transformational Strategy

December 8, 2008
Upcoming SlideShare
Loading in …5
×

Dow Accelerates Implementation of its Transformational Strategy Presentation

1,266 views

Published on

Published in: Economy & Finance
0 Comments
1 Like
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
1,266
On SlideShare
0
From Embeds
0
Number of Embeds
5
Actions
Shares
0
Downloads
38
Comments
0
Likes
1
Embeds 0
No embeds

No notes for slide

Dow Accelerates Implementation of its Transformational Strategy Presentation

  1. 1. Dow Accelerates its Transformational Strategy December 8, 2008
  2. 2. SEC Disclosure Rules ►Some of our comments today may include statements about our expectations for the future. Those expectations involve risks and uncertainties. Dow cannot guarantee the accuracy of any forecasts or estimates, and we do not plan to update any forward-looking statements if our expectations change. If you would like more information on the risks involved in forward-looking statements, please see our annual report and our SEC filings. ►In addition, some of our comments may reference non-GAAP financial measures. Where available, a reconciliation to the most directly comparable GAAP financial measures and other associated disclosures are provided on the internet at www.dow.com in the Financial Reports page of the Investor Relations section. 2 Dow Accelerates its Transformational Strategy
  3. 3. CEO Priorities – March 2006 ► Drive Basics strategy for competitive advantage ► Preferentially invest in Performance/Market Facing businesses ► Extend geographic growth ► Actively manage portfolio ► Address industry and enterprise issues that impact profitability ► Accelerate technology and innovation ► Continue to drive financial fitness A committed team focused on delivering results 3 Dow Accelerates its Transformational Strategy
  4. 4. Dow’s Transformational Strategy JOINT JOINT VENTURES VENTURES Products MARKET Solutions BASICS PERFORMANCE FEEDSTOCKS FEEDSTOCKS FACING JOINT Systems JOINT VENTURES VENTURES Innovation, Technology and R&D 4 Dow Accelerates its Transformational Strategy
  5. 5. A Powerful New Dow 2/3 Specialties Feedstock-Driven Market-Driven Feedstock-Driven Market-Driven Businesses Businesses Asset Light Rohm and Haas Chemicals, Performance Health & Joint Advanced Petrochemicals Products Agriculture Ventures Materials & Feedstocks 5 Dow Accelerates its Transformational Strategy
  6. 6. A Powerful New Dow 2/3 Specialties Feedstock-Driven Market-Driven Feedstock-Driven Market-Driven Businesses Businesses Asset Light Rohm and Haas Chemicals, Performance Health & Joint Advanced Petrochemicals Products Agriculture Ventures Materials & Feedstocks Business Services Lean Corporate Center 6 Dow Accelerates its Transformational Strategy
  7. 7. Actions Announced Today ► Eliminating ~5,000 full-time jobs ► Closing 20 facilities in high-cost locations ► Divesting several non-strategic businesses ► Idling ~180 production plants ► Reducing contractor workforce by ~6,000 7 Dow Accelerates its Transformational Strategy
  8. 8. 4Q/08 Restructuring Charge ►Estimated $700 million pre-tax charge – ~$350 million severance – ~$350 million asset-related charges (non-cash) ►EPS impact of $.50 - $.60 per share ►$700 Million in Annual Operating Cost Savings – $350 Million Run-Rate by End of 2009 – $700 Million Run-Rate by End of 2010 8 Dow Accelerates its Transformational Strategy
  9. 9. Total Operating Cost Reductions Year-End Run Rate Estimates ($ Millions) 2009 2010 4Q/08 $350 $700 Restructuring ROH Acquisition $485 $800 Synergies $835 $1,500 400 500 600 700 800 $1.5 Billion Total Commitment Rohm & Haas $110 million is additive 9 Dow Accelerates its Transformational Strategy
  10. 10. Lower Cash Requirements Through 2009 ► Working Capital Reductions $2 Billion ► Lower Capital Spending $600 Million ► 4Q ’08 Restructuring Actions ($80) Million 10 Dow Accelerates its Transformational Strategy
  11. 11. A Consistent & Reliable Dividend ► A 96-year history of consistent dividends – Maintained or increased each year – Increased 25% since 2006 Quarterly Dividends Paid Per Share* 1928 1938 1948 1958 1968 1978 1988 1998 2008** 1912 *ADJUSTED FOR STOCK SPLITS AND STOCK DIVIDENDS **2008 DIVIDEND ANNUALIZED BASED ON Q3 YTD PAYOUT 11 Dow Accelerates its Transformational Strategy
  12. 12. Summary – Key Messages ► Transformation to an earnings growth company accelerated ► Three different operating models supports new portfolio – Lean corporate center – More autonomy for business units ► $1.6 billion operating cost savings and synergy targets ► $2.5 billion in lower cash requirements through 2009 ► Uninterrupted dividend for 96 years without reduction! 12 Dow Accelerates its Transformational Strategy
  13. 13. Dow Accelerates its Transformational Strategy December 8, 2008

×