Dow Inc. · NYSE:DOW

Dow — The Dow Chemical Company — Citi Basic Materials Conference 2014

17 slides from Dow's conference presentation, Dec 2, 2014

  1. Slide 1: Citi Basic Materials Conference

    Citi Basic Materials Conference The Dow Chemical Company Joe Harlan Chief Commercial Officer and Vice Chairman, Chairman Market Businesses December 2, 2014 The Dow Chemical Company

  2. Slide 2: SEC Disclosure Rules

    SEC Disclosure Rules Some of our comments today 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 expectatio

  3. Slide 3: Key Takeaways

    Key Takeaways  Increasing shareholder rewards: 14% dividend increase and $5B share buyback program  Cash engine is healthy and getting stronger — growth projects ramping up  Portfolio management raises divestiture target to $7B ‒ $8.5B through JV monetization  Driving costs out and operating rat

  4. Slide 4: Delivering on Our Commitments

    Delivering on Our Commitments Adjusted EPS Growth Adjusted EBITDA Growth Adjusted EBITDA Margin Expansion 3 10 16% 9 15% 2 8 14% $/Share $B 7 13% 1 6 12% 5 11% 0 4 10% TTM TTM TTM Self‐Help Actions Drive 8 Consecutive Quarters of Adjusted EPS, EBITDA and Margin Growth TTM defined as Trailing Twelve

  5. Slide 5: Our Priorities Going Forward

    Our Priorities Going Forward Fully capitalize on growth levers Make further strategic choices: Go deeper and narrower to drive the next level of long‐term growth Maintain strongg focus on rewardingg shareholders 5

  6. Slide 6: Investing for Growth

    Investing for Growth Capital Expenditures Peak in 2015 2014 2015 2016 2017 2018 TX ETHYLENE CRACKER & FREEPORT PDH SADARA DERIVATIVES TX Ethylene Cracker LA Ethane Sadara Sadara Ground Breaking Flexibility Phase 2 & 3 Financial TX Ethylene Cracker & St. Charles Freeport PDH Sadara Start‐up eline Clo

  7. Slide 7: Announcing New Segments Aligned to Dow's Strategy

    Announcing New Segments Aligned to Dow’s Strategy Performance Materials Agricultural Sciences Consumer Solutions Infrastructure Solutions & Chemicals Performance Plastics  Crop Protection  Consumer Care  Dow Building &  Chlor Alkali and Vinyl  Dow Elastomers  Dow Automotive Construction  Chlo

  8. Slide 8: Sources of Value in Performance Plastics

    Sources of Value in Performance Plastics Mix and Application PE Cycle Ethylene Cycle Oil to Gas Spread $ $100‒$200/MT $ / $ $200‒$300/MT $ / $ $600‒$1000/MT $ / Dow Value Comes from Four Sources 8

  9. Slide 9: Peak Pricing Power versus Feedstock Advantage

    Peak Pricing Power versus Feedstock Advantage Cracker Margins Expanded by $200/MT–$300/MT in Last Three Peaks Dow Produces ~10MM tons/year y 30 180 Natural Gas Brent Oil MBTU) 25 150 Cycle Peaks US Natural Gas ($/MM bl) Crude Oil ($/bb 20 120 15 90 CRUDE : GAS Brent C 10 Price Arbitrage 60 5 30 0 0

  10. Slide 10: Global Ethylene Operating Rates Entering the Peak

    Global Ethylene Operating Rates Entering the Peak  Operating rates continue recovery from the 2008 lows  Expect p p peak scenarios in 2016-2018,, with pricing p gppower improving p g through g 2014 into 2015 Ethylene Production=Demand Nameplate Capacity Industry Op Rate 200 98 Cycle Pricing Power

  11. Slide 11: Epoxy and Polyurethanes Delivering Improvement

    Epoxy and Polyurethanes Delivering Improvement Actions Results  Continued productivity focus  161 bps EBITDA margin Polyurethane Industrial Solutions across portfolio improvement in TTM change over last year for Performance  Major restructuring in Epoxy Materials and Chemicals and Polyurethanes 

  12. Slide 12: Announcing New Segments Aligned to Dow's Strategy

    Announcing New Segments Aligned to Dow’s Strategy Agricultural Sciences Consumer Solutions Infrastructure Solutions Performance Materials Performance Plastics & Chemicals  Crop Protection  Consumer Care  Dow Building &  Chlor Alkali and Vinyl  Dow Elastomers  Dow Automotive Construction  Chlo

  13. Slide 13: Leading Position in the Agriculture Industry

    Leading Position in the Agriculture Industry Crop Protection Growth Driven by Targeted Investments  Focused investment in innovation and channel drives growth; balanced across platforms Herbicide program* with the — Created a world‐class Seeds business Untreated Enlist™ Weed Control System — ‘Best‐

  14. Slide 14: Consumers Crave Improved Displays and Novel Form Factors

    Consumers Crave Improved Displays and Novel Form Factors New Technologies Provide Great Growth Opportunities for Display Technologies Major Display Market Trends (2014+) Strategic Focus of Dow Electronic Materials  Growing desire for close to natural light, moving i away from f LED’s ’ high‐energy

  15. Slide 15: Driving Growth in Energy and Water

    Driving Growth in Energy and Water Focus on “Down the Chain” Solutions Global Reach with a Local Approach  Business groupings create unique capability  Identifying and building a strong presence combinations to generate unique solutions to in promising, high potential regions address significant e

  16. Slide 16: We Are an Integrated Chemical Company that Is Delivering Value

    We Are an Integrated Chemical Company that Is Delivering Value  Cash and growth engines are simultaneously ramping  New N projects j t are gearing i up (USGC, (USGC Sadara, S d ENLIST™ launch) l h)  The ethylene cycle is upon us — pricing power will add ~$2.5B/yr  Extending our continuing dedica

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