E I DU PONT DE NEMOURS AND CO WILMINGTON, Del., Jan. 24, 2017 /PRNewswire/ --
Fourth-Quarter Highlights
---
GAAP(1) earnings per share totaled $0.29 versus a loss of
$(0.26) per share in prior year. Operating earnings(2) per
share nearly doubled to $0.51 from $0.27 in prior year.
Sales of $5.2 billion decreased 2 percent. Local price declined
by 2 percent while currency benefited sales by 1 percent.
Volume declined 1 percent as growth in Performance Materials,
Electronics & Communications and Industrial Biosciences was
more than offset by declines in Agriculture, due to timing of
fourth-quarter seed sales primarily due to the southern U.S.
route-to-market change. Excluding this timing change, sales
would have increased 2 percent.
Segment operating margins expanded by 305 basis points.
GAAP operating costs(3) decreased by 5 percent. Operating
costs(2), excluding significant items and non-operating
pension/OPEB benefits, declined by 9 percent versus prior
year.
----------------------------------------------------------
Full-Year Highlights
---
GAAP(1) earnings per share increased 36 percent to $2.85 from
$2.09 in prior year. Operating earnings(2) per share increased
21 percent to $3.35 from $2.77 in prior year.
Sales of $24.6 billion decreased 2 percent. Local price and
currency each lowered sales by 1 percent. Volume was flat as
growth in Performance Materials, Nutrition & Health and
Industrial Biosciences was offset by declines in the other
segments. Excluding the change in timing of fourth-quarter
seed sales in Agriculture, sales decreased 1 percent.
Total company gross margin expanded 60 basis points, excluding
a 70-basis-point benefit from a non-operating pension/OPEB
curtailment gain. Segment operating margins expanded about 200
basis points, with increases in all reportable segments.
GAAP operating costs(3) decreased by 5 percent. Operating
costs(2), excluding significant items and non-operating
pension/OPEB costs, declined 11 percent, exceeding the 2016
cost savings commitment.
Free cash flow4 improved $1.6 billion primarily due to higher
earnings, lower capital expenditures, lower tax payments, and
working capital improvements.
DuPont expects first-quarter 2017 GAAP(1) earnings per share
to decrease about 18 percent versus prior year. First-quarter
2017 operating earnings(2) per share are expected to increase
about 8 percent versus prior year.
--------------------------------------------------------------
(1) Generally Accepted Accounting
Principles (GAAP)
(2) See schedules A, C, and D for
definitions and reconciliations of
non-GAAP measures.
(3) GAAP operating costs defined as
other operating charges, selling,
general & administrative, and
research & development costs.
4 Free cash flow is defined as cash
used for operating activities less
purchases of property, plant and
equipment. See schedule A for
reconciliation of non-GAAP
measure.
E. I. du Pont de Nemours and
Company
DuPont (NYSE: DD), a science company that brings world-class, innovative products, materials, and services to the global marketplace, today announced fourth-quarter 2016 GAAP earnings of $0.29 per share and operating earnings(2) of $0.51 per share. Prior year GAAP and operating earnings(2) were a loss of $(0.26) and earnings of $0.27 per share, respectively. GAAP income from continuing operations before taxes was $353 million, including charges of $(599) million related to an asset impairment charge and transaction costs offset by a $382 million non-operating pension/OPEB gain. Prior year GAAP loss from continuing operations before taxes was $(421) million, including a $(775) million charge for restructuring costs. Refer to Schedule B for details of significant items excluded from operating earnings per share.
For the full-year 2016, DuPont delivered GAAP earnings of $2.85 per share and operating earnings(2) of $3.35 per share. Prior-year GAAP and operating earnings(2) were $2.09 and $2.77 per share, respectively.
Fourth-quarter sales were $5.2 billion, down 2 percent versus prior year as a 1-percent benefit from currency was offset by a 2-percent decline in local price and a 1-percent decline in volume. Volume declined as growth in Performance Materials, Electronics & Communications and Industrial Biosciences was more than offset by declines in Agriculture, due to timing of fourth-quarter seed sales primarily due to the southern U.S. route-to-market change. Excluding this timing change, sales would have increased 2 percent. Full-year sales totaled $24.6 billion, down 2 percent versus prior year due to a 1-percent negative impact from currency and a 1-percent decline in local price. Volume was flat as growth in Performance Materials, Nutrition & Health and Industrial Biosciences was offset by declines in the other segments. Excluding the change in timing of fourth-quarter seed sales in Agriculture, sales decreased 1 percent.
Free cash flow(4) improvement of $1.6 billion for the year reflected higher earnings, lower capital expenditures, lower tax payments, working capital improvements, and the absence of Chemours cash outflows.
"2016 was an important year for DuPont as we exceeded our expectations for earnings, cost savings, operating margin expansion and free cash flow improvement," said Ed Breen, chairman and CEO of DuPont. "We made excellent progress on our strategic priorities in 2016 to increase shareholder value, and we will build on this groundwork as we move into 2017. We look forward to closing the merger with Dow and are continuing to have constructive discussions with regulators in key jurisdictions. We now expect the merger to close in the first half of 2017, pending regulatory approval."
Global Consolidated Net Sales - 4th Quarter and Full Year
Three Months Ended
December 31, 2016 Percent Change Due to:
----------------- ----------------------
% Local Price and Portfolio /
$ Change Product Mix Currency Volume Other
--- ------ ----------- -------- ------ -----
(Dollars in millions)
U.S. & Canada $1,676 (11) (7) - (4) -
EMEA * 1,183 (1) - (1) - -
Asia Pacific 1,543 9 - 1 9 (1)
Latin America 809 - 2 7 (9) -
---
Total Consolidated Sales $5,211 (2) (2) 1 (1) -
Twelve Months Ended
December 31, 2016 Percent Change Due to:
----------------- ----------------------
% Local Price and Portfolio /
$ Change Product Mix Currency Volume Other
--- ------ ----------- -------- ------ -----
(Dollars in millions)
U.S. & Canada $10,413 (3) (2) - - (1)
EMEA * 5,739 (5) 1 (3) (2) (1)
Asia Pacific 5,801 3 (1) (1) 4 1
Latin America 2,641 (3) 2 (2) (2) (1)
-----
Total Consolidated Sales $24,594 (2) (1) (1) - -
* Europe, Middle East & Africa
Segment Net Sales - 4th Quarter and Full Year
Three Months Ended
December 31, 2016 Percent Change Due to:
----------------- ----------------------
Local Price and Portfolio /
$ % Change Product Mix Currency Volume Other
--- -------- ----------- -------- ------ -----
(Dollars in millions)
Agriculture $1,393 (10) (4) 4 (9) (1)
Electronics & Communications 521 6 - - 6 -
Industrial Biosciences 401 1 (1) (1) 2 1
Nutrition & Health 809 - - - - -
Performance Materials 1,331 4 (2) - 7 (1)
Protection Solutions 717 - - - - -
Other 39
---
Consolidated Net Sales 5,211 (2) (2) 1 (1) -
Segment Net Sales - 4th Quarter and Full Year, Continued
Twelve Months Ended
December 31, 2016 Percent Change Due to:
----------------- ----------------------
Local Price and Portfolio /
$ % Change Product Mix Currency Volume Other
--- -------- ----------- -------- ------ -----
(Dollars in millions)
Agriculture $9,516 (3) - (2) (1) -
Electronics & Communications 1,960 (5) (2) - (3) -
Industrial Biosciences 1,500 1 - (2) 2 1
Nutrition & Health 3,268 - - (2) 2 -
Performance Materials 5,249 (1) (3) (1) 3 -
Protection Solutions 2,954 (3) (1) - (2) -
Other 147
---
Consolidated Net Sales 24,594 (2) (1) (1) - -
Operating Earnings - 4th Quarter and Full Year
Change vs. 2015
---------------
(Dollars in millions) 4Q16 4Q15 $ %
---- ---- --- ---
Agriculture $(19) $(54) $35 65%
Electronics & Communications 98 87 11 13%
Industrial Biosciences 67 78 (11) -14%
Nutrition & Health 135 85 50 59%
Performance Materials 328 281 47 17%
Protection Solutions 142 147 (5) -3%
Other (48) (71) 23 32%
--- --- ---
Total segment operating earnings (5) 703 553 150 27%
Exchange gains (losses) (6) 106 (24) 130 nm
Corporate expenses (5) (88) (160) 72 -45%
Interest expense (92) (82) (10) 12%
--- --- ---
Operating earnings before income taxes (2) 629 287 342 119%
Provision for income taxes on operating earnings (2) (180) (51) (129)
Less: Net income attributable to noncontrolling interests (2) (3) 1
Operating earnings (2) $451 $239 $212 89%
==== ==== ====
Operating earnings per share (2) $0.51 $0.27 $0.24 89%
===== ===== =====
GAAP earnings per share $0.29 $(0.26) $0.55 212%
===== ====== =====
Operating Earnings - 4th Quarter and Full Year, Continued
Change vs. 2015
---------------
(Dollars in millions) YTD 2016 YTD 2015 $ %
-------- -------- --- ---
Agriculture $1,758 $1,646 $112 7%
Electronics & Communications 358 359 (1) 0%
Industrial Biosciences 270 243 27 11%
Nutrition & Health 504 373 131 35%
Performance Materials 1,297 1,216 81 7%
Protection Solutions 668 641 27 4%
Other (215) (235) 20 9%
---- ---- ---
Total segment operating earnings (5) 4,640 4,243 397 9%
Exchange gains (losses) (5) (6) (106) 93 (199) nm
Corporate expenses (5) (340) (573) 233 -41%
Interest expense (370) (322) (48) 15%
---- ---- ---
Operating earnings before income taxes (2) 3,824 3,441 383 11%
Provision for income taxes on operating earnings (2) (861) (932) 71
Less: Net income attributable to noncontrolling interests 12 6 6
Operating earnings (2) $2,951 $2,503 $448 18%
====== ====== ====
Operating earnings per share (2) $3.35 $2.77 $0.58 21%
===== ===== =====
GAAP earnings per share $2.85 $2.09 $0.76 36%
===== ===== =====
(5) See Schedules B and C for listing of significant items.
(6) See Schedule D for additional information on exchange gains and losses.
The following is a summary of business results for each of the company's reportable segments comparing fourth quarter and full year with the prior year, unless otherwise noted.
Agriculture - For the fourth-quarter 2016, an operating loss of $19 million improved $35 million, or 65 percent. A benefit from currency of $78 million and cost savings, were partially offset by timing of seed deliveries, primarily related to the southern U.S. route-to-market change. Operating margins expanded by about 210 basis points.
Full-year operating earnings of $1,758 million increased $112 million, or 7 percent, as cost savings and lower product costs were partially offset by timing of seed deliveries, primarily related to the southern U.S. route-to-market change and negative currency. Operating margins expanded by about 170 basis points.
Electronics & Communications - Fourth-quarter 2016 operating earnings of $98 million increased $11 million, or 13 percent, on cost savings and volume growth in Solamet(®) paste. Operating margins expanded by about 115 basis points.
Full-year operating earnings of $358 million were even with the prior year as cost savings were offset by lower sales and a $16 million litigation expense. Sales declined on weakness in consumer electronics markets and decreased demand in the photovoltaic market impacting sales of Tedlar(® )film. Operating margins expanded by about 90 basis points.
Industrial Biosciences - Fourth-quarter 2016 operating earnings of $67 million decreased $11 million, or 14 percent, primarily due to declines in CleanTech. Operating margins contracted by about 295 basis points.
Full-year operating earnings of $270 million increased $27 million, or 11 percent, reflecting cost savings and an increase in sales, partly offset by a negative impact from currency. Operating margins expanded by 155 basis points.
Nutrition & Health - Fourth-quarter 2016 operating earnings of $135 million increased $50 million, or 59 percent, on cost savings and a $27 million gain from an asset sale. Volume was flat as growth in sweeteners and probiotics was offset by declines in protein solutions. Operating margins expanded by 615 basis points.
Full-year operating earnings of $504 million increased $131 million, or 35 percent, on cost savings, volume growth in probiotics and cultures and a $27 million gain from an asset sale. Operating margins expanded by about 400 basis points.
Performance Materials - Fourth-quarter 2016 operating earnings of $328 million increased $47 million, or 17 percent, as lower product costs, cost savings, and increased demand in global automotive markets, more than offset the absence of $33 million in prior year benefits from the sale of a business and tax benefits associated with a manufacturing site. Operating margins expanded by 275 basis points.
Full-year operating earnings of $1,297 million increased $81 million, or 7 percent as cost savings, increased volumes, and lower product costs, more than offset a $63 million negative impact from currency and the absence of $49 million of benefits from the prior year, comprised of a net benefit from a joint venture, the sale of a business and the realization of tax benefits associated with a manufacturing site. Operating margins expanded by about 180 basis points.
Protection Solutions - Fourth-quarter 2016 operating earnings of $142 million decreased $5 million, or 3 percent, as cost savings were more than offset by higher costs due to lower plant utilization and the negative impact from currency. Operating margins contracted by about 60 basis points.
Full-year operating earnings of $668 million increased $27 million, or 4 percent, as cost savings were partially offset by the impact of lower sales. Operating margins expanded by about 150 basis points.
First-Quarter 2017 Outlook
We expect the merger to close in the first half of 2017, pending regulatory approval. Therefore, only guidance for the first quarter of 2017 is being provided. The company expects first-quarter 2017 GAAP earnings to decrease about 18 percent from prior year. The company's first-quarter 2017 GAAP earnings include an expected charge of about $0.15 per share for transaction costs associated with the planned merger with Dow. Prior year GAAP earnings included a net benefit of $0.18 per share from significant items, primarily due to a gain on the sale of an entity.
First-quarter 2017 operating earnings(2) are expected to increase about 8 percent versus prior year driven by benefits from cost savings and the impact of the change in timing for seed deliveries, primarily related to the southern U.S. route-to-market change in Agriculture. These benefits are anticipated to be partially offset by the expected reduction in planted corn acres in the U.S.
DuPont will hold a conference call and webcast on Tuesday, Jan. 24, 2017, at 8:00 AM ET to discuss this news release. The webcast and additional presentation materials can be accessed by visiting the company's investor website (Events & Presentations) at www.investors.dupont.com. A replay of the conference call webcast will be available for 90 days by calling 1-630-652-3042, Passcode 6670063#. For additional information see the investor center at http://www.dupont.com.
Use of Non-GAAP Measures
This earnings release includes information that does not conform to U.S. generally accepted accounting principles (GAAP) and are considered non-GAAP measures. These measures include the company's consolidated results and earnings per share on an operating earnings basis, which excludes significant items and non-operating pension and other postretirement employee benefit costs (operating earnings and operating EPS), total segment pre-tax operating earnings, operating costs and corporate expenses on an operating earnings basis. Management uses these measures internally for planning, forecasting and evaluating the performance of the company's segments, including allocating resources and evaluating incentive compensation. From a liquidity perspective, management uses free cash flow, which is defined as cash provided/used by operating activities less purchases of property, plant and equipment. Free cash flow is useful to investors and management to evaluate the company's cash flow and financial performance, and is an integral financial measure used in the company's financial planning process. Management believes that these non-GAAP measurements are meaningful to investors as they provide insight with respect to ongoing operating results of the company and provide a more useful comparison of year-over-year results. These non-GAAP measurements supplement our GAAP disclosures and should not be viewed as an alternative to GAAP measures of performance. Reconciliations of non-GAAP measures to GAAP are provided in schedules A, C and D. Details of significant items are provided in schedule B.
About DuPont
DuPont (NYSE: DD) has been bringing world-class science and engineering to the global marketplace in the form of innovative products, materials, and services since 1802. The company believes that by collaborating with customers, governments, NGOs, and thought leaders we can help find solutions to such global challenges as providing enough healthy food for people everywhere, decreasing dependence on fossil fuels, and protecting life and the environment. For additional information about DuPont and its commitment to inclusive innovation, please visit http://www.dupont.com.
Forward-Looking Statements: This communication contains "forward-looking statements" within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In this context, forward-looking statements often address expected future business and financial performance and financial condition, and often contain words such as "expect," "anticipate," "intend," "plan," "believe," "seek," "see," "will," "would," "target," similar expressions, and variations or negatives of these words.
Forward-looking statements by their nature address matters that are, to different degrees, uncertain, such as statements about the consummation of the proposed transaction and the anticipated benefits thereof. 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 company's control. Some of the important factors that could cause the company's 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 and, in general, for products for the agriculture industry; outcome of significant litigation and environmental matters, including realization of associated indemnification assets, if any; 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, natural disasters and weather events and patterns which could affect demand as well as availability of products for the agriculture industry; ability to protect and enforce the company's intellectual property rights; successful integration of acquired businesses and separation of underperforming or non-strategic assets or businesses; and risks related to the agreement entered on December 11, 2015, with The Dow Chemical Company pursuant to which the companies have agreed to effect an all-stock merger of equals, including the completion of the proposed transaction on anticipated terms and timing, the ability to fully and timely realize the expected benefits of the proposed transaction and risks related to the intended business separations contemplated to occur after the completion of the proposed transaction. Important risk factors relating to the proposed transaction and intended business separations include, but are not limited to, (i) the completion of the proposed transaction on anticipated terms and timing, including obtaining regulatory approvals, anticipated tax treatment, unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies for the management, expansion and growth of the new combined company's operations and other conditions to the completion of the merger, (ii) the various approvals, authorizations and declarations of non-objection from certain regulatory and governmental authorities may not be obtained, on a timely basis or otherwise, including that these regulatory or governmental agencies may impose conditions on the granting of such approvals, including requiring the respective Dow and DuPont businesses to divest certain assets if necessary in order to obtain certain regulatory approvals or otherwise limiting the ability of the combined company to integrate parts of the DuPont and Dow businesses, (iii) the ability of Dow and DuPont to integrate the business successfully and to achieve anticipated synergies, risks and costs and pursuit and/or implementation of the potential separations, including anticipated timing, any changes to the configuration of businesses included in the potential separation if implemented, (iv) the intended separation of the agriculture, material science and specialty products businesses of the combined company post-mergers in one or more tax efficient transactions on anticipated terms and timing, including a number of conditions which could delay, prevent or otherwise adversely affect the proposed transactions, including possible issues or delays in obtaining required regulatory approvals or clearances, disruptions in the financial markets or other potential barriers, (v) continued availability of capital and financing and rating agency actions, (vi) potential business uncertainty, including changes to existing business relationships, during the pendency of the merger that could affect DuPont's financial performance, and (vii) certain restrictions during the pendency of the merger that may impact DuPont's ability to pursue certain business opportunities or strategic transactions. These risks, as well as other risks associated with the proposed merger, are more fully discussed in the joint proxy statement of Dow and DuPont and the prospectus of DowDuPont included in the definitive registration statement on Form S-4 (File No. 333-209869), (as amended, the Registration Statement). While the list of factors presented here is, and the list of factors presented in the Registration Statement are, considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. Consequences of material differences in results as compared with those anticipated in the forward-looking statements could include, among other things, business disruption, operational problems, financial loss, legal liability to third parties and similar risks, any of which could have a material adverse effect on DuPont's consolidated financial condition, results of operations, credit rating or liquidity. The company undertakes no duty to publicly revise or update any forward-looking statements whether as a result of future developments, new information or otherwise, should circumstances change, except as otherwise required by securities and other applicable laws.
E.I. du Pont de Nemours and Company
Consolidated Income Statements
(Dollars in millions, except per share amounts)
SCHEDULE A
Three Months Ended Twelve Months Ended
December 31, December 31,
2016 2015 2016 2015
---- ---- ---- ----
Net sales $5,211 $5,299 $24,594 $25,130
Cost of goods sold 3,147 3,409 14,469 15,112
Other operating charges (1) 182 46 686 459
Selling, general and administrative expenses (1) 964 1,075 4,319 4,615
Research and development expense 381 483 1,641 1,898
Other income, net (1) (301) (145) (708) (697)
Interest expense (1) 92 82 370 342
Employee separation / asset related charges, net (1) 393 770 552 810
--- --- --- ---
Income (loss) from continuing operations before income taxes 353 (421) 3,265 2,591
Provision for (benefit from) income taxes on continuing operations (1) 101 (190) 744 696
--- ---- --- ---
Income (loss) from continuing operations after income taxes 252 (231) 2,521 1,895
Income (loss) from discontinued operations after income taxes 11 (25) 4 64
--- --- --- ---
Net income (loss) 263 (256) 2,525 1,959
Less: Net (loss) income attributable to noncontrolling interests (2) (3) 12 6
--- --- --- ---
Net income (loss) attributable to DuPont $265 $(253) $2,513 $1,953
==== ===== ====== ======
Basic earnings (loss) per share of common stock:
Basic earnings (loss) per share of common stock from continuing operations $0.29 $(0.26) $2.86 $2.10
Basic earnings (loss) per share of common stock from discontinued operations 0.01 (0.03) - 0.07
---- ----- --- ----
Basic earnings (loss) per share of common stock (2) $0.30 $(0.29) $2.87 $2.17
===== ====== ===== =====
Diluted earnings (loss) per share of common stock:
Diluted earnings (loss) per share of common stock from continuing operations $0.29 $(0.26) $2.85 $2.09
Diluted earnings (loss) per share of common stock from discontinued operations 0.01 (0.03) - 0.07
---- ----- --- ----
Diluted earnings (loss) per share of common stock (2) $0.30 $(0.29) $2.85 $2.16
===== ====== ===== =====
Dividends per share of common stock $0.38 $0.38 $1.52 $1.72
===== ===== ===== =====
Average number of shares outstanding used in earnings (loss) per share (EPS) calculation:
Basic 867,460,000 876,500,000 872,560,000 893,992,000
Diluted 872,363,000 881,727,000 877,036,000 899,527,000
Reconciliation of Non-GAAP Measures
-----------------------------------
Summary of Earnings Comparison
Three Months Ended December 31, Twelve Months Ended December 31,
2016 2015 % Change 2016 2015 % Change
---- ---- -------- ---- ---- --------
Income (loss) from continuing operations after income taxes (GAAP) $252 $(231) 209% $2,521 $1,895 33%
Less: Significant items charge included in income from continuing operations (384) (411) (421) (348)
after income taxes (per Schedule B)
Non-operating pension/OPEB benefits (costs) included in income from 187 (56) (21) (266)
continuing operations after income taxes (3)
Net (loss) income attributable to noncontrolling interest from continuing (2) (3) 12 6
operations
Operating earnings (Non-GAAP) (4) $451 $239 89% $2,951 $2,503 18%
Earnings (loss) per share from continuing operations (GAAP) $0.29 $(0.26) 212% $2.85 $2.09 36%
Less: Significant items charge included in EPS (per Schedule B) (0.44) (0.47) (0.48) (0.39)
Non-operating pension/OPEB benefits (costs) included in EPS (3) 0.22 (0.06) (0.02) (0.29)
---- -----
Operating earnings per share (Non-GAAP) (4) $0.51 $0.27 89% $3.35 $2.77 21%
E.I. du Pont de Nemours and Company
Condensed Consolidated Balance Sheets
(Dollars in millions, except per share amounts)
SCHEDULE A (continued)
December 31, December 31,
2016 2015
---- ----
Assets
Current assets
Cash and cash equivalents $4,605 $5,300
Marketable securities 1,362 906
Accounts and notes receivable, net 4,971 4,643
Inventories 5,673 6,140
Prepaid expenses 506 398
Total current assets 17,117 17,387
Property, plant and equipment, net of accumulated depreciation 9,231 9,784
(December 31, 2016 - $14,736; December 31, 2015 - $14,346)
Goodwill 4,180 4,248
Other intangible assets 3,664 4,144
Investment in affiliates 649 688
Deferred income taxes 3,308 3,799
Other assets 1,815 1,116
----- -----
Total $39,964 $41,166
======= =======
Liabilities and Equity
Current liabilities
Accounts payable $3,705 $3,398
Short-term borrowings and capital lease obligations 429 1,165
Income taxes 101 173
Other accrued liabilities 4,662 5,580
----- -----
Total current liabilities 8,897 10,316
Long-term borrowings and capital lease obligations 8,107 7,642
Other liabilities 12,333 12,591
Deferred income taxes 431 417
--- ---
Total liabilities 29,768 30,966
------ ------
Commitments and contingent liabilities
Stockholders' equity
Preferred stock 237 237
Common stock, $0.30 par value; 1,800,000,000 shares authorized; 285 288
Issued at December 31, 2016 - 950,044,000; December 31, 2015 - 958,388,000
Additional paid-in capital 11,190 11,081
Reinvested earnings 14,924 14,510
Accumulated other comprehensive loss (9,911) (9,396)
Common stock held in treasury, at cost (87,041,000 shares at December 31, 2016 (6,727) (6,727)
and December 31, 2015)
Total DuPont stockholders' equity 9,998 9,993
----- -----
Noncontrolling interests 198 207
--- ---
Total equity 10,196 10,200
Total $39,964 $41,166
======= =======
E.I. du Pont de Nemours and Company
Condensed Consolidated Statement of Cash Flows
(Dollars in millions)
SCHEDULE A (continued)
Twelve Months Ended
December 31,
2016 2015
---- ----
Total Company
Net income $2,525 $1,959
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation 939 1,104
Amortization of intangible assets 319 362
Net periodic pension benefit cost 572 591
Contributions to pension plans (535) (308)
Gain on sale of businesses and other assets (436) (59)
Asset-related charges 682 147
Other operating activities - net 366 106
Change in operating assets and liabilities - net (1,132) (1,586)
------ ------
Cash provided by operating activities 3,300 2,316
Investing activities
Purchases of property, plant and equipment (1,019) (1,629)
Investments in affiliates (19) (76)
Payments for businesses - net of cash acquired - (152)
Proceeds from sale of businesses and other assets - net 316 156
Net increase in short-term financial instruments (452) (776)
Foreign currency exchange contract settlements (385) 615
Other investing activities - net 45 34
--- ---
Cash used for investing activities (1,514) (1,828)
Financing activities
Dividends paid to stockholders (1,335) (1,546)
Net (decrease) increase in borrowings (240) 2,141
Repurchase of common stock (916) (2,353)
Proceeds from exercise of stock options 181 274
Cash transferred to Chemours at spin-off - (250)
Other financing activities - net (18) (89)
--- ---
Cash used for financing activities (2,328) (1,823)
Effect of exchange rate changes on cash (153) (275)
---- ----
Decrease in cash and cash equivalents (695) (1,610)
Cash and cash equivalents at beginning of period 5,300 6,910
----- -----
Cash and cash equivalents at end of period $4,605 $5,300
====== ======
Reconciliation of Non-GAAP Measure
----------------------------------
Calculation of Free Cash Flow - Total Company
Twelve Months Ended December 31,
2016 2015
---- ----
Cash provided by operating activities (GAAP) $3,300 $2,316
Purchases of property, plant and equipment (1,019) (1,629)
Free cash flow (Non-GAAP) $2,281 $687
====== ====
(1) See Schedule B
for detail of
significant
items.
(2) The sum of the
individual
earnings per
share amounts
from
continuing
operations
and
discontinued
operations
may not equal
the total
company
earnings per
share amounts
due to
rounding.
(3) Fourth quarter
2016 and year
to date 2016,
non-
operating
pension/OPEB
benefits /
(costs)
include a
$382 pre-tax
curtailment
gain ($254
after-tax or
$0.29 per
share)
related to
the changes
to the U.S.
Pension Plan
and U.S. OPEB
benefits
announced in
November
2016. Year
to date 2015,
non-
operating
pension/OPEB
costs
includes a
$23 exchange
loss on
foreign
pension
balances.
(4) Operating
earnings and
operating
earnings per
share are
defined as
earnings from
continuing
operations
excluding
significant
items and
non-
operating
pension/OPEB
costs. Non-
operating
pension/OPEB
costs
includes all
of the
components of
net periodic
benefit cost
from
continuing
operations
with the
exception of
the service
cost
component.
E.I. du Pont de Nemours and Company
Schedule of Significant Items from Continuing Operations
(Dollars in millions, except per share amounts)
SCHEDULE B
SIGNIFICANT ITEMS
Pre-tax After-tax(8) ($ Per Share)
2016 2015 2016 2015 2016 2015
---- ---- ---- ---- ---- ----
1st Quarter
-----------
Transaction costs(1) $(24) $(12) $(21) $(11) $(0.02) $(0.01)
Customer claims adjustment/recovery(4) 23 35 15 22 0.02 0.02
Gain on sale of entity(5) 369 - 214 - 0.24 -
Restructuring charges, net(2) (77) - (48) - (0.06) -
Asset impairment charge(3) - (37) - (30) - (0.03)
Ukraine devaluation(6) - (40) - (38) - (0.04)
--- --- --- --- --- -----
1st Quarter - Total $291 $(54) $160 $(57) $0.18 $(0.06)
==== ==== ==== ==== ===== ======
2nd Quarter
-----------
Transaction costs(1) $(76) $(25) $(59) $(38) $(0.07) $(0.04)
Customer claims recovery(4) 30 - 19 - 0.02 -
Restructuring adjustments / charges(2) 90 (2) 59 (2) 0.07 -
Litigation settlement(7) - 112 - 72 - 0.08
2nd Quarter - Total $44 $85 $19 $32 $0.02 $0.04
=== === === === ===== =====
3rd Quarter
-----------
Transaction costs(1) $(122) $(9) $(91) $(6) $(0.10) $(0.01)
Restructuring charges, net(2) (17) - (14) - (0.02) -
Asset impairment charge(3) (158) - (111) - (0.13) -
Customer claims adjustment/recovery(4) - 147 - 94 - 0.11
3rd Quarter - Total $(297) $138 $(216) $88 $(0.25) $0.10
===== ==== ===== === ====== =====
4th Quarter
-----------
Transaction costs(1) $(164) $(10) $(131) $(7) $(0.15) $(0.01)
Restructuring adjustments / charges(2) 42 (775) 25 (508) 0.03 (0.58)
Asset impairment charge(3) (435) - (278) - (0.32) -
Litigation settlement (7) - 33 - 21 - 0.02
Customer claims adjustment/recovery (4) - 130 - 83 - 0.10
4th Quarter - Total $(557) $(622) $(384) $(411) $(0.44) $(0.47)
===== ===== ===== ===== ====== ======
Year-to-date Total (9) $(519) $(453) $(421) $(348) $(0.48) $(0.39)
===== ===== ===== ===== ====== ======
E.I. du Pont de Nemours and Company
Schedule of
Significant Items from Continuing Operations
(Dollars
in millions, except per share amounts)
(1) Fourth, third, second, and first quarter
2016 included charges of $(164), $(122),
$(76), and $(24), respectively, and fourth
quarter 2015 included charges of ($10),
recorded in selling, general and
administrative expenses related to costs
associated with the planned merger with The
Dow Chemical Company and related
activities. For fourth quarter 2016 and
full year 2016, the effective tax rate for
the total of pre-tax charges was 32.2% and
27.0%, respectively. A significant portion
of the transaction costs are in the US;
however, those costs are not always tax-
deductible. In addition, the Company
incurred $(20) in the fourth quarter 2016
of other tax costs related to the planned
merger and related activities.
Third quarter and first quarter 2015
included charges of $(9) and $(12),
respectively, recorded in other operating
charges associated with transaction costs
related to the separation of the
Performance Chemicals segment. Second
quarter 2015 included charges of $(25)
associated with transaction costs related
to the separation of the Performance
Chemicals segment consisting of $(5)
recorded in other operating charges and
$(20) recorded in interest expense. Second
quarter 2015 also includes a tax charge of
$(17) due to a state tax rate change
associated with the separation.
(2) Fourth, third, second and first quarter 2016
included benefits / (charges) of $14,
$(17), $90 and $(2), respectively,
associated with the 2016 Global Cost
Savings and Restructuring Program. The
fourth and second quarter benefits were
primarily due to the reduction in severance
and related benefit costs due to the
elimination of positions at a lower cost
than expected. The charges in the third
and first quarters were primarily due to
identification of additional asset-related
charges with the first quarter charge being
offset by reduction in severance and
related benefit costs. The third quarter
charge consisted of $(14) recorded in
employee separation/asset related charges,
net and $(3) recorded to other income, net.
The fourth, second and first quarter
benefits / (charges) were recorded in
employee separation/asset related charges,
net.
Fourth quarter 2015 included a $(798)
restructuring charge consisting of $(793)
recorded in employee separation/asset
related charges, net and $(5) recorded in
other income, net associated with
structural actions across all businesses
and staff functions globally to operate
more efficiently by further consolidating
businesses and aligning staff functions
more closely with them. The charge included
$(656) of severance and related benefit
costs, $(109) of asset related charges, and
$(33) of contract termination costs.
Fourth quarter 2016 included a benefit of $7
for reductions to the first quarter 2016
charge for La Porte site contract
termination costs within the Agriculture
segment. The first quarter 2016 included
a $(75) restructuring charge related to the
decision to not re-start the segment's
insecticide manufacturing facility at the
La Porte site located in La Porte, Texas.
The first quarter charge included $(41) of
asset related charges, $(18) of contract
termination costs, and $(16) of employee
severance and related benefit costs. The
fourth quarter 2016 benefit and first
quarter 2016 charge were recorded in
employee separation/asset related charges,
net.
Fourth quarter 2016 and fourth quarter 2015
included benefits of $21 and $23 for
reductions to the previously recognized
severance costs related to the 2014
restructuring program. Second quarter 2015
included a $(2) net restructuring charge
primarily due to the identification of
additional projects in certain segments,
offset by lower than estimated individual
severance costs and workforce reductions
achieved through non-severance programs.
The activity in 2016 and 2015 related to
the 2014 restructuring program was recorded
in employee separation/asset related
charges, net.
(3) During the fourth quarter 2016, a $(435)
pre-tax impairment charge was recorded in
employee separation /asset related
charges, net related to the write-down of
the company's uncompleted enterprise
resource planning (ERP) system which the
company had elected to defer further
testing and deployment in fourth quarter
2015. The company intends to complete the
ERP project, however, given the
uncertainties related to timing as well as
potential developments and changes to
technologies in the market place at the
time of restart, it can no longer be
considered probable.
During third quarter 2016, a $(158) pre-tax
impairment charge was recorded in employee
separation /asset related charges, net
related to the write-down of indefinite
lived intangible assets within the
Industrial Biosciences segment. The third
quarter charge was the result of
realignment of brand marketing strategies
and a determination to phase out the use of
certain acquired trade names.
During first quarter 2015, a $(37) pre-tax
impairment charge was recorded in employee
separation /asset related charges, net for
a cost basis investment within the Other
segment. The assessment resulted from the
venture's revised operating plan reflecting
underperformance of its European wheat
based ethanol facility and deteriorating
European ethanol market conditions.
(4) In the second quarter 2016, third quarter
2015 and first quarter 2015, the company
recorded insurance recoveries of $30, $147
and $35, respectively, in other operating
charges for recovery of costs for customer
claims related to the use of the
Agriculture's segment Imprelis(R)
herbicide. First quarter 2016 and fourth
quarter 2015 included benefits of $23 and
$130, respectively, in other operating
charges for reductions in the accrual for
customer claims related to the use of the
Imprelis(R) herbicide.
(5) First quarter 2016 included a gain of $369
recorded in other income, net associated
with the sale of the DuPont (Shenzhen)
Manufacturing Limited entity, which held
certain buildings and other assets. The
gain is reflected as a Corporate item.
(6) First quarter 2015 included a charge of
$(40) in other income, net associated with
remeasuring the company's Ukrainian hryvnia
net monetary assets. Ukraine's central bank
adopted a decision to no longer set the
indicative hryvnia exchange rate. The
hryvnia became a free-floating exchange
rate and lost approximately a third of its
value through the quarter.
(7) Fourth and second quarter 2015 included
gains of $33 and $112, respectively, net of
legal expenses, recorded in other income,
net related to the company's settlement of
a legal claim. This matter relates to the
Protection Solutions segment.
(8) Unless specifically addressed in notes
above, the income tax effect on significant
items is calculated based upon the enacted
tax laws and statutory income tax rates
applicable in the tax jurisdiction(s) of
the underlying non-GAAP adjustment.
(9) Earnings per share for the year may not
equal the sum of quarterly earnings per
share due to the changes in average share
calculations.
E.I. du Pont de Nemours and Company
Consolidated Segment Information
(Dollars in millions)
SCHEDULE C
Three Months Ended Twelve Months Ended
December 31, December 31,
SEGMENT NET SALES (1) 2016 2015 2016 2015
-------------------- ---- ---- ---- ----
Agriculture $1,393 $1,550 $9,516 $9,798
Electronics & Communications 521 493 1,960 2,070
Industrial Biosciences 401 397 1,500 1,478
Nutrition & Health 809 807 3,268 3,256
Performance Materials 1,331 1,284 5,249 5,305
Protection Solutions 717 720 2,954 3,039
Other 39 48 147 184
--- --- --- ---
Consolidated net sales $5,211 $5,299 $24,594 $25,130
====== ====== ======= =======
Three Months Ended Twelve Months Ended
December 31, December 31,
SEGMENT OPERATING EARNINGS (1) 2016 2015 2016 2015
----------------------------- ---- ---- ---- ----
Agriculture $(19) $(54) $1,758 $1,646
Electronics & Communications 98 87 358 359
Industrial Biosciences 67 78 270 243
Nutrition & Health 135 85 504 373
Performance Materials 328 281 1,297 1,216
Protection Solutions 142 147 668 641
Other (48) (71) (215) (235)
--- --- ---- ----
Total segment operating earnings 703 553 4,640 4,243
Corporate expenses (88) (160) (340) (573)
Interest expense (92) (82) (370) (322)
--- --- ---- ----
Operating earnings before income taxes and exchange gains (losses) 523 311 3,930 3,348
Net exchange gains (losses)(2) 106 (24) (106) 93
Operating earnings before income taxes (Non-GAAP) $629 $287 $3,824 $3,441
Non-operating pension/OPEB benefits (costs) (3) 281 (86) (40) (397)
Total significant items before income taxes (557) (622) (519) (453)
---- ---- ----
Income (loss) from continuing operations before income taxes (GAAP) $353 $(421) $3,265 $2,591
==== ===== ====== ======
Three Months Ended Twelve Months Ended
December 31, December 31,
SIGNIFICANT ITEMS BY SEGMENT (PRE-TAX) (1)(4) 2016 2015 2016 2015
-------------------------------------------- ---- ---- ---- ----
Agriculture $14 $(30) $(37) $148
Electronics & Communications (9) (89) 4 (78)
Industrial Biosciences 2 (60) (152) (61)
Nutrition & Health (3) (46) 9 (50)
Performance Materials (2) (60) 5 (62)
Protection Solutions 4 (8) 14 105
Other (8) - (11) (40)
--- --- --- ---
Total significant items by segment (2) (293) (168) (38)
Corporate expenses (555) (329) (351) (355)
Interest expense - - - (20)
Net exchange gains (losses) - - - (40)
--- --- --- ---
Total significant items before income taxes $(557) $(622) $(519) $(453)
===== ===== ===== =====
E.I. du Pont de Nemours and Company
Consolidated Segment Information
(Dollars in millions)
SCHEDULE C (continued)
Corporate Expenses
------------------
The reconciliation below reflects GAAP corporate expenses excluding significant items.
Three Months Ended Twelve Months Ended
December 31, December 31,
2016 2015 2016 2015
---- ---- ---- ----
Corporate expenses (GAAP) $643 $489 $691 $928
Less: Significant items charge (4) 555 329 351 355
Corporate expenses (Non-GAAP) $88 $160 $340 $573
=== ==== ==== ====
(1) Segment operating earnings is defined as income (loss) from continuing operations before income taxes excluding
significant pre-tax benefits (charges), non-operating pension/OPEB costs, exchange gains (losses), corporate
expenses and interest. DuPont Sustainable Solutions, previously within the company's former Safety & Protection
segment (now Protection Solutions) was comprised of two business units: Clean Technologies (CleanTech) and
Consulting Solutions. Effective January 1, 2016, the CleanTech business is reported in the Industrial Biosciences
segment and the Consulting Solutions business unit is reported within Other. Reclassifications of prior year data
have been made to conform to current year classifications.
(2) See Schedule D for additional information on exchange gains and losses. Year to date 2015 exchange gains, on an
operating earnings basis
(Non-GAAP), excludes the impact of a $23 exchange loss on non-operating pension.
(3) Fourth quarter 2016 and year to date 2016, non-operating pension/OPEB benefits (costs) include a $382 pre-tax
curtailment gain ($254 after-tax or $0.29 per share) related to the changes to the U.S. Pension Plan and U.S. OPEB
benefits announced in November 2016. Year to date 2015, non-operating pension/OPEB costs includes a $23 exchange
loss on foreign pension balances.
(4) See Schedule B for detail of significant items.
E.I. du Pont de Nemours and Company
Reconciliation of Non-GAAP Measures
(Dollars in millions, except per share amounts)
SCHEDULE D
Reconciliations of Adjusted EBIT / EBITDA to Consolidated Income Statements
Three Months Ended December 31, Twelve Months Ended December 31,
2016 2015 2016 2015
---- ---- ---- ----
Income (loss) from continuing operations after income taxes (GAAP) $252 $(231) $2,521 $1,895
Add: Provision for (benefit from) for income taxes on continuing operations 101 (190) 744 696
Income (loss) from continuing operations before income taxes $353 $(421) $3,265 $2,591
Add: Significant items charge before income taxes(1) 557 622 519 453
Add: Non-operating pension/OPEB (benefits) costs (2) (281) 86 40 397
---- --- --- ---
Operating earnings before income taxes (Non-GAAP) $629 $287 $3,824 $3,441
Less: Net (loss) income attributable to noncontrolling interests from continuing (2) (3) 12 6
operations
Add: Interest expense (1) 92 82 370 322
--- --- --- ---
Adjusted EBIT from operating earnings (Non-GAAP) 723 372 4,182 3,757
Add: Depreciation and amortization 279 303 1,258 1,338
--- --- ----- -----
Adjusted EBITDA from operating earnings (Non-GAAP) $1,002 $675 $5,440 $5,095
====== ==== ====== ======
Reconciliation of Operating Costs to Consolidated Income Statement Line Items
GAAP operating costs is defined as other operating charges, selling, general and administrative expenses, and research and development expense. The reconciliation below reflects operating costs excluding significant items and non-operating pension/OPEB (benefits) costs.
Three Months Ended December 31, 2016 Three Months Ended December 31, 2015
As Less: Less: Non- (Non-GAAP) As Less: Less: Non- (Non-GAAP)
Reported Significant Operating Reported Significant Operating
(GAAP) Items (1) Pension/ (GAAP) Items (1) Pension/
OPEB OPEB Costs
Benefits
--------
Other operating charges $182 $ - $ - $182 $46 $(130) $ - $176
Selling, general and administrative 964 164 (112) 912 1,075 10 35 1,030
expenses
Research and development expense 381 - (42) 423 483 - 13 470
--- --- --- --- --- --- --- ---
Total $1,527 $164 $(154) $1,517 $1,604 $(120) $48 $1,676
====== ==== ===== ====== ====== ===== === ======
Twelve Months Ended December 31, 2016 Twelve Months Ended December 31, 2015
As Less: Less: Non- (Non-GAAP) As Less: Less: Non- (Non-GAAP)
Reported Significant Operating Reported Significant Operating
(GAAP) Items (1) Pension/ (GAAP) Items (1) Pension/
OPEB OPEB Costs
Costs
-----
Other operating charges $686 $(53) $ - $739 $459 $(286) $ - $745
Selling, general and administrative 4,319 386 16 3,917 4,615 10 150 4,455
expenses
Research and development expense 1,641 - 6 1,635 1,898 - 56 1,842
----- --- --- ----- ----- --- --- -----
Total $6,646 $333 $22 $6,291 $6,972 $(276) $206 $7,042
------ ---- --- ------ ------ ----- ---- ------
E.I. du Pont de Nemours and Company
Reconciliation of Non-GAAP Measures
(Dollars in millions, except per share amounts)
SCHEDULE D (continued)
Reconciliation of Operating Earnings Per Share (EPS) Outlook
The reconciliation below represents the company's outlook on an operating earnings basis, defined as earnings excluding significant items and non-operating pension/OPEB costs.
Quarter ended March 31,
2017 Outlook 2016 Actual
------------ -----------
EPS from continuing operations (GAAP) $1.14 $1.39
Significant items (1), (3)
-------------------------
Transaction costs (3) (0.15) (0.02)
Gain on sale of entity - 0.24
Restructuring charges, net - (0.06)
Customer claims adjustment - 0.02
Non-operating pension/OPEB costs - estimate (0.07) (0.05)
Operating EPS (Non-GAAP) $1.36 $1.26
===== =====
Exchange Gains/Losses on Operating Earnings (1)
The company routinely uses forward exchange contracts to offset its net exposures, by currency, related to the foreign currency denominated monetary assets and liabilities of its operations. The objective of this program is to maintain an approximately balanced position in foreign currencies in order to
minimize, on an after-tax basis, the effects of exchange rate changes. The net pre-tax exchange gains and losses are recorded in other loss, net and the related tax impact is recorded in provision for (benefit from) income taxes on the Consolidated Income Statements.
Three Months Ended Twelve Months Ended
December 31, December 31,
2016 2015 2016 2015
---- ---- ---- ----
Subsidiary Monetary Position Gain (Loss)
---------------------------------------
Pre-tax exchange gains (losses) $13 $(23) $198 $(320)
Local tax (expenses) benefits (97) (44) (126) (70)
--- --- ---- ---
Net after-tax impact from subsidiary exchange (losses) gains $(84) $(67) $72 $(390)
==== ==== === =====
Hedging Program Gain (Loss)
--------------------------
Pre-tax exchange gains (losses) $93 $(1) $(304) $413
Tax (expenses) benefits (33) - 110 (150)
--- --- --- ----
Net after-tax impact from hedging program exchange gains (losses) $60 $(1) $(194) $263
=== === ===== ====
Total Exchange Gain (Loss)
-------------------------
Pre-tax exchange gains (losses) (4) $106 $(24) $(106) $93
Tax (expenses) benefits (130) (44) (16) (220)
---- --- --- ----
Net after-tax exchange losses $(24) $(68) $(122) $(127)
==== ==== ===== =====
As shown above, the "Total Exchange Gain (Loss)" is the sum of the "Subsidiary Monetary Position Gain (Loss)" and the "Hedging Program Gain (Loss)."
E.I. du Pont de Nemours and Company
Reconciliation of Non-GAAP Measures
(Dollars in millions, except per share amounts)
SCHEDULE D (continued)
Reconciliation of Base Income Tax Rate to Effective Income Tax Rate
Base income tax rate is defined as the effective income tax rate less the effect of exchange gains (losses), as defined above, significant items and non-operating pension/OPEB costs.
Three Months Ended Twelve Months Ended
December 31, December 31,
2016 2015 2016 2015
---- ---- ---- ----
Income (loss) from continuing operations before income taxes (GAAP) $353 $(421) $3,265 $2,591
Add: Significant items - charge (2) 557 622 519 453
Non-operating pension/OPEB (benefits) costs (1) (281) 86 40 397
Less: Net exchange gains (losses) (4) 106 (24) (106) 93
--- --- ---- ---
Income from continuing operations before income taxes, significant items, $523 $311 $3,930 $3,348
exchange gains (losses), and non-operating pension/OPEB costs (Non-GAAP)
Provision for (benefit from) income taxes on continuing operations (GAAP) $101 $(190) $744 $696
Add: Tax benefits on significant items 173 211 98 105
Tax (expenses) benefits on non-operating pension/OPEB benefits/costs (94) 30 19 131
Tax expenses on exchange gains/losses (130) (44) (16) (220)
---- --- --- ----
Provision for income taxes on continuing earnings, excluding exchange gains $50 $7 $845 $712
(losses) (Non-GAAP)
Effective income tax rate (GAAP) 28.6% 45.1% 22.8% 26.9%
Significant items and non-operating pension/OPEB costs effect - % (27.3)% (0.3)% 0.2%
------ ----- ---
Tax rate, from continuing operations before significant items and non-operating 28.6% 17.8% 22.5% 27.1%
pension/OPEB benefits/costs
Exchange gains (losses) effect (19.0)% (15.5)% (1.0)% (5.8)%
------ ------ ----- -----
Base income tax rate from continuing operations (Non-GAAP) 9.6% 2.3% 21.5% 21.3%
=== === ==== ====
(1) See Schedule B for detail of significant items.
(2) Fourth quarter 2016 and year to date 2016, non-operating pension/OPEB (benefits) costs include a $(382) pre-tax
curtailment gain ($(254) after-tax or $(0.29) per share) related to the changes to the U.S. Pension Plan and U.S.
OPEB benefits announced in November 2016.Year to date December 31, 2015, non-operating pension/OPEB costs includes
a $23 exchange loss on foreign pension balances.
(3) The 2017 first quarter outlook for significant items includes the current estimate for first quarter transaction costs
associated with the planned merger with The Dow Chemical Company and related activities. It does not include
expected gain related to the sale of the company's Nutrition & Health food safety diagnostics business which is
expected to close during the first half of 2017 pending customary closing conditions.
(4) Year to date December 31, 2015 exchange gains (losses), on an operating earnings basis (Non-GAAP), excludes a $23
exchange loss on non-
operating pension.
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SOURCE DuPont