TIDMDOW
The Dow Chemical Company (NYSE: DOW):
First Quarter 2013 Highlights
-- The Company reported earnings of $0.46 per share, or adjusted earnings
of $0.69 per share(1). This compares with earnings of
$0.35 per share in the year-ago period, or adjusted earnings
of
$0.61 per share.
-- Sales were $14.4 billion, down 2 percent versus the same quarter last
year, but were flat excluding the impact of the Company's
Feedstocks
and Energy operating segment.
-- Agricultural Sciences sales rose 14 percent, surpassing $2 billion,
due to accelerated new product sales. Electronic and
Functional
Materials sales also grew (up 2 percent).
-- Volume declined 3 percent, or was flat excluding Feedstocks and
Energy. Volume grew in emerging geographies (up 2 percent), led
by
Latin America (up 6 percent). Volume remained flat in North
America,
and declined in Western Europe (down 12 percent).
-- Strong pricing actions in the quarter delivered local price increases
in most operating segments and geographic areas, resulting in
a
1 percent increase in price.
-- Purchased raw material costs, including hydrocarbons and energy,
declined nearly $300 million.
-- EBITDA(2) was $2.2 billion, versus $1.7 billion in the
year-ago period. Adjusted EBITDA(3) was $2.3 billion, up
nearly 10 percent versus the prior year. EBITDA rose in most
operating
segments, led by increases in Performance Plastics.
-- Equity earnings were $230 million, versus $169 million in the same
quarter last year, primarily reflecting gains in the
Company's
cost-advantaged joint ventures in Kuwait.
-- Cash flow from operations increased nearly $500 million versus the
year-ago period.
-- Dow continued to drive deleveraging actions, reducing gross debt by
$901 million in the quarter. In addition, interest expense
declined
$33 million versus the year-ago period due to ongoing debt
reduction.
Comment
Andrew N. Liveris, Dow's chairman and chief executive officer,
stated:
"Our performance this quarter demonstrates our team's continuing
determination to deliver earnings growth, despite ongoing
uncertainties in the global economy. We are aggressively managing
our businesses and driving near-term execution measures -
demonstrated by this quarter's marked improvement in both margins
and profitability. We continue to deliver on our plan by
implementing cost and cash flow actions, paying down debt,
improving return on capital and taking firm decisions on our
portfolio, as evidenced by our recently announced target of $1.5
billion in proceeds from divestitures in the near term.
Collectively, our proactive, execution-focused actions position Dow
well to navigate ongoing challenging market conditions and deliver
value to our shareholders. We expect the results of these actions
to accelerate throughout the year."
Three Months Ended
Mar 31, Mar 31,
In millions, except per share amounts 2013 2012
Net Sales $14,383 $14,719
Net Income Available for Common Stockholders $550 $412
Net Income Available for Common Stockholders, $819 $714
excluding Certain Items
Earnings per Common Share - diluted $0.46 $0.35
Adjusted Earnings per Share $0.69 $0.61
Review of First Quarter Results
The Dow Chemical Company (NYSE: DOW) reported sales of $14.4
billion in the first quarter of 2013, down 2 percent versus the
year-ago period. Sales were flat excluding the impact of the
Company's Feedstocks and Energy operating segment.
Volume declined 3 percent, or was flat excluding Feedstocks and
Energy. Volume rose in emerging geographies (up 2 percent), with
increases led by Latin America (up 6 percent). Volume remained flat
in North America, and declined in Western Europe (down 12
percent).
The Company delivered local price increases in most operating
segments and geographic areas on account of strong pricing actions
in the quarter, which resulted in a 1 percent overall increase in
price.
Purchased raw material costs, including hydrocarbons and energy,
declined nearly $300 million.
Dow reported EBITDA of $2.2 billion, versus $1.7 billion in the
year-ago period. Adjusted EBITDA was $2.3 billion, up nearly 10
percent versus the prior year. EBITDA increased in most operating
segments, led by Performance Plastics. Adjusted EBITDA margin(4)
expanded 170 basis points, reflecting ongoing price and volume
management.
Earnings for the quarter were $0.46 per share, or adjusted
earnings of $0.69 per share. This compares with earnings of $0.35
per share in the same quarter last year, or adjusted earnings of
$0.61 per share.
Certain Items in the current quarter consisted of non-cash
charges reflecting the adjustment of uncertain tax positions, a
charge related to the early extinguishment of debt and a charge for
implementation costs related to the Company's restructuring
programs. (See Supplemental Information at the end of the release
for a description of Certain Items affecting results.)
Dow's global operating rate was 82 percent, up 4 percentage
points sequentially and down 1 percentage point versus the year-ago
period.
Cash flow from operations increased nearly $500 million versus
the year-ago period.
Research and Development (R&D) expenses were up 7 percent
versus the same period last year, reflecting continued investments
in Dow's technology-driven segments, particularly Agricultural
Sciences.
Selling, General and Administrative (SG&A) expenses rose 9
percent versus the year-ago period, led by increased investments in
Agricultural Sciences.
Equity earnings were $230 million, versus $169 million in the
same quarter last year, primarily reflecting gains in the Company's
cost-advantaged joint ventures in Kuwait.
Dow continued to drive deleveraging actions, reducing gross debt
by $901 million in the quarter. In addition, interest expense
declined $33 million versus the year-ago period due to ongoing debt
reduction.
"Our performance this quarter demonstrates our team's continuing
determination to deliver earnings growth, despite ongoing
uncertainties in the global economy," said Andrew N. Liveris, Dow's
chairman and chief executive officer. "We are aggressively managing
our businesses and driving near-term execution measures -
demonstrated by this quarter's marked improvement in both margins
and profitability. We continue to deliver on our plan by
implementing cost and cash flow actions, paying down debt,
improving return on capital and taking firm decisions on our
portfolio, as evidenced by our recently announced target of $1.5
billion in proceeds from divestitures in the near term.
Collectively, our proactive, execution-focused actions position Dow
well to navigate ongoing challenging market conditions and deliver
value to our shareholders. We expect the results of these actions
to accelerate throughout the year."
Electronic and Functional Materials
Sales in Electronic and Functional Materials were $1.1 billion,
up 2 percent from the same quarter last year, as volume growth of 3
percent was slightly offset by a 1 percent decline in price.
Revenue declined slightly in Dow Electronic Materials, as volume
increases were offset by price declines due in part to currency.
Semiconductor Technologies showed volume growth due to strength in
memory manufacturing.
Functional Materials revenue grew due to increased volumes in
all businesses and many key market sectors, with improvements in
the pharmaceutical sector, coupled with continued resiliency in
food and energy sectors.
Equity earnings for the segment were $17 million, down from $19
million in the year-ago period. EBITDA for the segment was $273
million. This compares with EBITDA of $243 million or adjusted
EBITDA of $260 million in the same quarter last year.
Coatings and Infrastructure Solutions
Coatings and Infrastructure Solutions reported sales of $1.7
billion, down 2 percent from the prior year. Price held flat, while
volume was down 2 percent. Volume declines were primarily driven by
Dow Building and Construction, due to difficult business conditions
in Europe and the Company's restructuring actions in that region.
Volume declines were also impacted by slower non-residential
construction demand in North America. Dow Coating Materials sales
were flat, with volume growth in North America and Asia Pacific
offset primarily by declines in Europe.
Dow Water and Process Solutions recorded sales growth due to
improving demand from stronger market conditions, which were
slightly offset by price declines due to the unfavorable impact of
currency.
Equity earnings were $26 million, compared with $22 million in
the same quarter last year. EBITDA for the segment was $186
million, down from EBITDA of $204 million, or adjusted EBITDA of
$245 million in the year-ago period.
Agricultural Sciences
Agricultural Sciences reported record first quarter sales of
$2.1 billion, up 14 percent versus the year-ago period. Volume
increased 11 percent and price rose 3 percent. New sales records
were posted in Crop Protection and Seeds, Traits and Oils.
First quarter sales of Crop Protection rose 7 percent, driven by
gains in North America and Latin America. Sales of new crop
protection products grew significantly for the quarter, with growth
led by pyroxsulam herbicide.
Seeds, Traits and Oils achieved a 37 percent sales gain in the
quarter versus the year-ago period, driven by strong farmer demand
for SmartStax® products across North and Latin America.
EBITDA for the segment was a new first quarter record of $484
million, up 7 percent from $451 million in the year-ago period.
Performance Materials
Sales in Performance Materials were $3.3 billion, down 4 percent
versus the year-ago period. Volume declined 5 percent, while price
rose 1 percent compared with the same period last year. Momentum in
the quarter drove price improvements over the comparable period,
with volumes down on softer demand.
Notable price improvements were achieved in Polyurethanes,
Formulated Systems and Oxygenated Solvents. Lower volumes were
reported in Epoxy and Polyurethanes, as these businesses
aggressively pursued price to improve underlying profitability.
Equity losses for the quarter were $23 million versus losses of
$17 million in the same quarter last year. The segment reported
EBITDA of $440 million. This compares with EBITDA of $332 million,
or $518 million on an adjusted basis during the year-ago
period.
Performance Plastics
Sales in Performance Plastics were $3.5 billion, down 3 percent
compared with the same quarter last year. Volume declined 3 percent
and price was flat. Volumes were lower on weak market demand
primarily in Europe, coupled with the previously announced shutdown
of a high-density polyethylene facility in Tessenderlo,
Belgium.
Dow Packaging and Specialty Plastics reported improved volumes
in North America and Latin America, where the Company also
benefited from strong ongoing feedstock fundamentals. These volume
increases were offset by lower volumes in Europe and Asia
Pacific.
Dow Elastomers achieved a record volume quarter due to stable
automotive builds in North America and improvements in adhesive
markets. Sales were down on price declines from year-ago levels.
Dow Electrical and Telecommunications sales were down on lower
sales in Asia Pacific, but margins expanded on lower feedstock
costs and effective execution of pricing initiatives.
Equity earnings for the segment were $57 million, up from $34
million in the year-ago period. EBITDA for the segment was $952
million, up 33 percent from $718 million in the same period last
year.
Feedstocks and Energy
Sales in Feedstocks and Energy were $2.6 billion, down 13
percent versus the same period last year. Price rose 1 percent,
while volume declined 14 percent, due primarily to slower market
demand in Europe, resulting in reduced operating rates. The ramp
down of supply agreements related to the divestiture of Dow's
polypropylene business was also a key driver of volume declines
during the quarter.
Equity earnings were $159 million, up from $125 million in the
same quarter last year. EBITDA for the segment was $240 million, an
increase from $198 million in the year-ago period.
Outlook
Commenting on the Company's outlook, Liveris said:
"Dow's focus remains unrelenting in implementing the specific
plans we have in place to accelerate near-term value creation:
organically growing attractive, high-growth businesses, improving
businesses where the return on capital is not meeting our
expectations, and leveraging the strength of our advantaged
feedstock position and flexibility. Importantly, we continue to
review our entire portfolio to identify other divestitures or
strategic actions we can take to ensure we optimize value for
shareholders.
"We have previously stated that our business plans did not call
for material macroeconomic improvements in 2013 versus 2012. Given
persistent volatility and uncertainty, this remains the right
mindset for operating the Company.
"Moving through 2013, we are singularly focused on driving
aggressive measures, quarter-by-quarter, and we remain confident
our actions will deliver on our plan for the year."
Dow will host a live Webcast of its first quarter earnings
conference call with investors to discuss its results, business
outlook and other matters today at 9:00 a.m. ET on www.dow.com.
(1) "Adjusted earnings per share" is defined
as earnings per share excluding the
impact of "Certain Items." See Supplemental
Information at the end of
the release for a description of these
items, as well as a reconciliation
of adjusted earnings per share to "Earnings
per common share - diluted."
(2) "EBITDA" is defined as earnings (i.e.,
"Net Income") before interest,
income taxes, depreciation and amortization.
A reconciliation of
EBITDA to "Net Income Available for
The Dow Chemical Company Common
Stockholders" is provided following
the Operating Segments table.
(3) "Adjusted EBITDA" is defined as EBITDA excluding
the impact of Certain Items.
(4) "Adjusted EBITDA margin" is defined
as EBITDA excluding the impact
of Certain Items as a percentage of reported sales.
®SmartStax multi-event technology developed
by Dow AgroSciences LLC
and Monsanto. SmartStax is a trademark
of Monsanto Technology LLC
About Dow
Dow (NYSE: DOW) combines the power of science and technology to
passionately innovate what is essential to human progress. The
Company connects chemistry and innovation with the principles of
sustainability to help address many of the world's most challenging
problems such as the need for clean water, renewable energy
generation and conservation, and increasing agricultural
productivity. Dow's diversified industry-leading portfolio of
specialty chemical, advanced materials, agrosciences and plastics
businesses delivers a broad range of technology-based products and
solutions to customers in approximately 160 countries and in high
growth sectors such as electronics, water, energy, coatings and
agriculture. In 2012, Dow had annual sales of approximately $57
billion and employed approximately 54,000 people worldwide. The
Company's more than 5,000 products are manufactured at 188 sites in
36 countries across the globe. References to "Dow" or the "Company"
mean The Dow Chemical Company and its consolidated subsidiaries
unless otherwise expressly noted. More information about Dow can be
found at www.dow.com.
Use of non-GAAP financial measures: Dow's management believes
that measures of income adjusted to exclude certain items
("non-GAAP" financial measures) provide relevant and meaningful
information to investors about the ongoing operating results of the
Company. Such financial measures are not recognized in accordance
with accounting principles generally accepted in the United States
of America ("GAAP") and should not be viewed as an alternative to
GAAP financial measures of performance. Reconciliations of non-GAAP
financial measures to GAAP financial measures are provided in the
Supplemental Information tables.
Note: The forward-looking statements contained in this document
involve risks and uncertainties that may affect the Company's
operations, markets, products, services, prices and other factors
as discussed in filings with the Securities and Exchange
Commission. These risks and uncertainties include, but are not
limited to, economic, competitive, legal, governmental and
technological factors. Accordingly, there is no assurance that the
Company's expectations will be realized. The Company assumes no
obligation to provide revisions to any forward-looking statements
should circumstances change, except as otherwise required by
securities and other applicable laws.
Financial Statements (Note A)
The Dow Chemical Company and Subsidiaries
Consolidated Statements of Income
Three Months Ended
Mar 31, Mar 31,
In millions, except per share 2013 2012
amounts (Unaudited)
Net Sales $ 14,383 $ 14,719
Cost of sales 11,707 12,285
Research and development expenses 435 405
Selling, general and administrative expenses 772 707
Amortization of intangibles 115 122
Restructuring charges (Note B) -- 357
Equity in earnings of nonconsolidated 230 169
affiliates
Sundry income (expense) - net (Note C) (32 ) 17
Interest income 8 6
Interest expense and amortization 296 329
of debt discount
Income Before Income Taxes 1,264 706
Provision for income taxes (Note D) 604 186
Net Income 660 520
Net income attributable to 25 23
noncontrolling interests
Net Income Attributable to 635 497
The Dow Chemical Company
Preferred stock dividends 85 85
Net Income Available for The Dow Chemical $ 550 $ 412
Company Common Stockholders
Per Common Share Data:
Earnings per common share - basic $ 0.46 $ 0.35
Earnings per common share - diluted $ 0.46 $ 0.35
Common stock dividends declared $ 0.32 $ 0.25
per share of common stock
Weighted-average common shares 1,181.1 1,160.9
outstanding - basic
Weighted-average common shares 1,187.6 1,168.7
outstanding - diluted
Depreciation $ 505 $ 510
Capital Expenditures $ 346 $ 402
Notes to the Consolidated Financial Statements:
Note A:The unaudited interim consolidated financial statements
reflect all adjustments which, in the opinion of management, are
considered necessary for a fair presentation of the results for the
periods covered. These statements should be read in conjunction
with the audited consolidated financial statements and notes
thereto included in the Company's Annual Report on Form 10-K for
the year ended December 31, 2012. Except as otherwise indicated by
the context, the terms "Company" and "Dow" as used herein mean The
Dow Chemical Company and its consolidated subsidiaries.
Note B:On March 27, 2012, the Company's Board of Directors
approved a restructuring plan as part of a series of actions to
optimize its portfolio, respond to changing and volatile economic
conditions, particularly in Western Europe, and to advance the
Company's Efficiency for Growth program. The restructuring plan
included the shutdown of a number of manufacturing facilities and a
workforce reduction. As a result of these activities, the Company
recorded pretax restructuring charges of $357 million in the first
quarter of 2012 that included asset write-downs and write-offs,
severance and costs associated with exit and disposal
activities.
Note C: In the first quarter of 2013, the Company recognized a
pretax loss of $60 million on the early extinguishment of debt; a
pretax loss of $24 million was recorded in the first quarter of
2012.
Note D:During the first quarter of 2013, the Company recognized
a tax charge of $223 million related to court rulings on two
separate matters that resulted in the adjustment of uncertain tax
positions.
The Dow Chemical Company and Subsidiaries
Consolidated Balance Sheets
Mar 31, Dec 31,
In millions (Unaudited) 2013 2012
Assets
Current Assets
Cash and cash equivalents (variable $ 3,514 $ 4,318
interest entities
restricted - 2013: $161; 2012: $146)
Accounts and notes receivable:
Trade (net of allowance for 5,478 5,074
doubtful receivables
- 2013: $122; 2012: $121)
Other 4,927 4,605
Inventories 9,335 8,476
Deferred income tax assets - current 645 877
Other current assets 349 334
Total current assets 24,248 23,684
Investments
Investment in nonconsolidated affiliates 3,810 4,121
Other investments (investments carried at fair 2,503 2,565
value - 2013: $2,000; 2012: $2,061)
Noncurrent receivables 345 313
Total investments 6,658 6,999
Property
Property 54,144 54,366
Less accumulated depreciation 36,876 36,846
Net property (variable interest 17,268 17,520
entities restricted
- 2013: $2,615; 2012: $2,554)
Other Assets
Goodwill 12,695 12,739
Other intangible assets (net 4,577 4,711
of accumulated amortization
- 2013: $2,886; 2012: $2,785)
Deferred income tax assets - noncurrent 3,218 3,333
Asbestos-related insurance 153 155
receivables - noncurrent
Deferred charges and other assets 487 464
Total other assets 21,130 21,402
Total Assets $ 69,304 $ 69,605
Liabilities and Equity
Current Liabilities
Notes payable $ 472 $ 396
Long-term debt due within one year 861 672
Accounts payable:
Trade 4,938 5,010
Other 2,223 2,327
Income taxes payable 487 251
Deferred income tax liabilities - current 95 95
Dividends payable 465 86
Accrued and other current liabilities 2,899 2,656
Total current liabilities 12,440 11,493
Long-Term Debt (variable interest entities 18,753 19,919
nonrecourse - 2013: $1,485; 2012: $1,406)
Other Noncurrent Liabilities
Deferred income tax liabilities - noncurrent 775 837
Pension and other postretirement 11,317 11,459
benefits - noncurrent
Asbestos-related liabilities - noncurrent 516 530
Other noncurrent obligations 3,360 3,353
Total other noncurrent liabilities 15,968 16,179
Redeemable Noncontrolling Interest 147 147
Stockholders' Equity
Preferred stock, series A 4,000 4,000
Common stock 3,024 3,008
Additional paid-in capital 3,387 3,281
Retained earnings 18,662 18,495
Accumulated other comprehensive loss (7,694 ) (7,516 )
Unearned ESOP shares (381 ) (391 )
The Dow Chemical Company's 20,998 20,877
stockholders' equity
Noncontrolling interests 998 990
Total equity 21,996 21,867
Total Liabilities and Equity $ 69,304 $ 69,605
See Notes to the Consolidated
Financial Statements.
The Dow Chemical Company and Subsidiaries
Operating Segments
Three Months Ended
Mar 31, Mar 31,
In millions (Unaudited) 2013 2012
Sales by operating segment
Electronic and Functional Materials $ 1,141 $ 1,121
Coatings and Infrastructure Solutions 1,667 1,703
Agricultural Sciences 2,103 1,838
Performance Materials 3,328 3,473
Performance Plastics 3,498 3,591
Feedstocks and Energy 2,556 2,935
Corporate 90 58
Total $ 14,383 $ 14,719
EBITDA (1) by operating segment
Electronic and Functional Materials $ 273 $ 243
Coatings and Infrastructure Solutions 186 204
Agricultural Sciences 484 451
Performance Materials 440 332
Performance Plastics 952 718
Feedstocks and Energy 240 198
Corporate (355 ) (438 )
Total $ 2,220 $ 1,708
Certain items decreasing EBITDA
by operating segment (2)
Electronic and Functional Materials $ -- $ (17 )
Coatings and Infrastructure Solutions -- (41 )
Agricultural Sciences -- --
Performance Materials -- (186 )
Performance Plastics -- --
Feedstocks and Energy -- --
Corporate (72 ) (137 )
Total $ (72 ) $ (381 )
EBITDA excluding certain items
by operating segment
Electronic and Functional Materials $ 273 $ 260
Coatings and Infrastructure Solutions 186 245
Agricultural Sciences 484 451
Performance Materials 440 518
Performance Plastics 952 718
Feedstocks and Energy 240 198
Corporate (283 ) (301 )
Total $ 2,292 $ 2,089
Continued
The Dow Chemical Company and Subsidiaries
Operating Segments (Continued)
Three Months Ended
Mar 31, Mar 31,
In millions (Unaudited) 2013 2012
Equity in earnings (losses) of
nonconsolidated affiliates
by operating segment (included in EBITDA)
Electronic and Functional Materials $ 17 $ 19
Coatings and Infrastructure Solutions 26 22
Agricultural Sciences 2 1
Performance Materials (23 ) (17 )
Performance Plastics 57 34
Feedstocks and Energy 159 125
Corporate (8 ) (15 )
Total $ 230 $ 169
(1) The Company uses EBITDA (which Dow defines
as earnings (i.e., "Net Income")
before interest, income taxes, depreciation and amortization)
as its measure of profit/loss for segment reporting purposes. EBITDA
by operating segment includes all operating items relating
to the businesses, except depreciation and
amortization; items that principally
apply to the Company as a whole are assigned to Corporate.
A reconciliation of EBITDA to "Net Income Available for The
Dow Chemical Company Common Stockholders" is provided below.
Reconciliation of EBITDA to Three Months Ended
"Net Income Available for
The Dow Chemical Company Common Stockholders"
Mar 31, Mar 31,
In millions (Unaudited) 2013 2012
EBITDA $ 2,220 $ 1,708
- Depreciation and amortization 668 679
+ Interest income 8 6
- Interest expense and amortization 296 329
of debt discount
Income Before Income Taxes $ 1,264 $ 706
- Provision for income taxes 604 186
- Net income attributable to 25 23
noncontrolling interests
- Preferred stock dividends 85 85
Net Income Available for The Dow Chemical $ 550 $ 412
Company Common Stockholders
(2) See Supplemental Information for a description of certain
items affecting results in 2013 and 2012.
The Dow Chemical Company and Subsidiaries
Sales by Geographic Area
Three Months Ended
Mar 31, Mar 31,
In millions (Unaudited) 2013 2012
North America $ 5,383 $ 5,337
Europe, Middle East and Africa 4,915 5,367
Asia Pacific 2,368 2,420
Latin America 1,717 1,595
Total $ 14,383 $ 14,719
Sales Volume and Price by Operating
Segment and Geographic Area
Three Months Ended
Mar 31, 2013
Percentage change Volume Price Total
from prior year
Electronic and Functional 3 % (1 )% 2 %
Materials
Coatings and Infrastructure (2 ) -- (2 )
Solutions
Agricultural Sciences 11 3 14
Performance Materials (5 ) 1 (4 )
Performance Plastics (3 ) -- (3 )
Feedstocks and Energy (14 ) 1 (13 )
Total (3 )% 1 % (2 )%
North America -- % 1 % 1 %
Europe, Middle East and Africa (10 ) 2 (8 )
Asia Pacific -- (2 ) (2 )
Latin America 6 2 8
Total (3 )% 1 % (2 )%
Supplemental Information
Description of Certain Items Affecting Results
The following table summarizes the impact of certain items
recorded in the three-month periods ended March 31, 2013 and March
31, 2012:
Certain Pretax Impact (1) Net Income (2) EPS - Diluted (3)
Items
Impacting
Results
Three Months Ended Three Months Ended Three Months Ended
Mar 31, Mar 31, Mar 31, Mar 31, Mar 31, Mar 31,
In 2013 2012 2013 2012 2013 2012
millions,
except
per share
amounts
(Unaudited)
Adjusted $ 819 $ 714 $ 0.69 $ 0.61
to
exclude
certain
items
(non-GAAP
measures)
Certain
items:
Restructuring $ (12 ) $ -- (8 ) -- (0.01 ) --
plan
implementation
costs
Restructuring -- (357 ) -- (287 ) -- (0.25 )
charges
Loss (60 ) (24 ) (38 ) (15 ) (0.03 ) (0.01 )
on
early
extinguishment
of debt
Uncertain -- -- (223 ) -- (0.19 ) --
tax
position
adjustments
Total $ (72 ) $ (381 ) $ (269 ) $ (302 ) $ (0.23 ) $ (0.26 )
certain
items
Reported $ 550 $ 412 $ 0.46 $ 0.35
(GAAP
amounts)
(1) Impact on "Income Before Income Taxes."
(2) "Net Income Available for The Dow Chemical
Company Common Stockholders."
(3) "Earnings per common share - diluted."
Results in the first quarter of 2013 were unfavorably impacted
by three items:
-- Pretax charges of $12 million for implementation costs related to the
Company's restructuring programs. The charges were included in
"Cost
of sales" ($11 million) and "Selling, general and
administrative
expenses" ($1 million) in the consolidated statements of income
and
reflected in Corporate.
-- Pretax loss of $60 million on the early extinguishment of debt,
included in "Sundry income (expense) - net" in the
consolidated
statements of income and reflected in Corporate.
-- A tax charge of $223 million related to court rulings on two separate
matters that resulted in the adjustment of uncertain tax
positions.
Results in the first quarter of 2012 were impacted by two
items:
-- Pretax restructuring charges of $357 million. On March 27, 2012, the
Company's Board of Directors approved a restructuring plan as
part of
a series of actions to optimize its portfolio, respond to
changing and
volatile economic conditions, particularly in Western Europe,
and to
advance the Company's Efficiency for Growth program. The
restructuring
plan included the shutdown of a number of manufacturing
facilities and
a workforce reduction. As a result of these activities, the
Company
recorded pretax restructuring charges of $357 million in the
first
quarter of 2012 consisting of costs associated with exit and
disposal
activities of $150 million, severance costs of $113 million and
costs
associated with asset write-downs and write-offs of $94 million.
The
impact of the charges is shown as "Restructuring charges" in
the
consolidated statements of income and is reflected in the
Company's
segment results as follows: $17 million in Electronic and
Functional
Materials, $41 million in Coatings and Infrastructure Solutions,
$186
million in Performance Materials and $113 million in
Corporate.
-- Pretax loss of $24 million on the early extinguishment of debt,
included in "Sundry income (expense) - net" in the
consolidated
statements of income and reflected in Corporate.
The Dow Chemical CompanyRebecca Bentley, +1 989 638
8568rmbentley@dow.com
This information is provided by Business Wire
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