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11 Use of
Non-GAAP Measures: This letter to shareholders contains certain non-GAAP
measurements that management believes are meaningful to investors because
they provide insight with respect to operating results of the company and
additional metrics for use in comparison to competitors. 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 previously published
company reports on Forms 10-K, 10-Q, and 8-K. These reports, along with
reconciliations on non-GAAP measures to GAAP are available on the Investor
Center of www.dupont.com under Key Financials & Filings. Reconciliations
of non-GAAP measures to GAAP are provided below. Year Year Year Year Year
Year Year RECONCIL IAT ION OF ADJUSTED OPERATING EPS 2014 2013 2012 2011 2010
2009 2008 GAAP EPS from continuing operations 3.90 3.04 2.59 3.38 2.94 1.70
2.28 Add: S ignificant Items 0.01 0.45 0.72 0.25 - 0.11 0.42 Add:
Non-Operating Pension & OPEB Costs / (Credits) 0.10 0.39 0.46 0.39 0.38
0.10 (0.28) Operating EPS (Non-GAAP) 4.01 3.88 3.77 4.02 3.32 1.91 2.42 L
ess: Performance Chemic als ( a) ,(b) 0.82 0.86 1.50 1.79 1.09 0.52 0.59 L
ess: Pharma ( c ) 0.02 0.02 0.04 0.20 0.34 0.74 0.73 Adjusted Operating EPS
(exc luding Performance Chemic als , Pharma) (Non-GAAP) 3.17 3.00 2.23 2.03
1.89 0.65 1.10 (c) Pharma operating earnings assumes a 35% tax rate. ( a)
Prior periods reflect the rec lass ifications of Viton® fluoroelastomers from
Performance Materials to Performance Chemic als. (b) Performance Chemic als operating
earnings assumes a base income tax rate from continuing operations of 1 9
.2%, 20.8% , 24.2% , 22.0% , 19.2% , 2 2 .1% and 20.4% for 2 0 1 4 ,
RECONCILIATION OF NON-GAAP MEASURES (UNAUDITED) 2013, 2 0 1 2 , 2 0 1 1 , 2 0
1 0 , 2009 and 2 0 0 8 , respectively. Year Year 2014 2008 Total Segment
Sales (a) 35,011 26,499 Less: Performance Chemicals (b) 6,497 6,245 Less:
Other 5 160 T otal Segment Sales (exc luding Performance Chemic als and
Other) 2 8 ,509 20,094 SEGMENT ADJUSTED OPERATING EARNINGS Segment Pre-tax
Operang Income (PTOI) (GAAP) (c) 6,356 3,373 Less: Performance Chemicals
PTOI (b) 913 619 Less: Other/Pharma PTOI (391) 839 Less: Corporate Expenses
(d) 572 479 Add: Significant Items (e) (444) 466 Segment Adjusted Operating
Earnings (exc luding Performance Chemic als and Other/Pharma) ( f) (Non-GAAP)
4 ,818 1 ,902 ( a) Segment sales inc ludes transfers. (b) Prior periods
reflect the rec lass ifications of Viton® fluoroelastomers from Performance
Materials to Performance Chemic als. (e) Represents s ignificant items inc
luded in Segment PT OI, exc luding those related to Performance Chemic als
and Other/Pharma. (c) Segment PT OI is defined as income ( loss) from
continuing operations before income taxes exc luding non-operating pension
and other postretirement employee benefit costs , exchange gains ( losses) ,
corporate expenses and interest. (d) Represents total corporate expenses exc
luding s ignificant items , an estimate of DuPont Performance Coatings res
idual costs and an estimate for an amount that would be allocated to
Performance Chemic als. ( f) Segment adjusted operating marg in (non-GAAP) is
based on total segment sales and segment adjusted operating earnings, exc
luding Performance Chemic als and Other/Pharma. SEGMENT SAL ES RECONCILATION
OF NON-GAAP MEASURES (UNAUDITED) (dollars in millions) Forward Looking
Statements This document contains forward-looking statements which may be
identified by their use of words like plans, expects, will, believes,
intends, estimates, anticipates or other words of similar meaning. All
statements that address expectations or projections about the future,
including statements about the companys strategy for growth, product
development, regulatory approval, market position, anticipated benefits of
recent acquisitions, timing of anticipated benefits from restructuring
actions, outcome of contingencies, such as litigation and environmental
matters, expenditures and financial results, are forward looking statements.
Forward-looking statements are not guarantees of future performance and are
based on certain assumptions and expectations of future events which may not
be realized. Forward-looking statements also involve risks and uncertainties,
many of which are beyond the companys control. Some of the important factors
that could cause the companys actual results to differ materially from those
projected in any such forward-looking statements are: fluctuations in energy
and raw material prices; failure to develop and market new products and optimally
manage product life cycles; ability to respond to market acceptance, rules,
regulations and policies affecting products based on biotechnology;
significant litigation and environmental matters; failure to appropriately
manage process safety and product stewardship issues; changes in laws and
regulations or political conditions; global economic and capital markets
conditions, such as inflation, interest and currency exchange rates; business
or supply disruptions; security threats, such as acts of sabotage, terrorism
or war, weather events and natural disasters; ability to protect and enforce
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