Dow Inc. · NYSE:DOW

Dow — The Dow Chemical Company — Deutsche Bank Global Industrials and Basic Materials Conference 2012

17 slides from Dow's conference presentation, Jun 14, 2012

  1. Slide 1: Deutsche Bank Global Industrials and Basic Materials Conference

    Deutsche Bank Global Industrials and Basic Materials Conference The Dow Chemical Company William H. Weideman, Chief Financial Officer June 14, 2012 January 4, 2012

  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: Agenda

    Agenda  1Q 2012 Overview  Drivers to Deliver Shareholder Value − Feedstock Advantage − Integrated Portfolio − Innovation Agenda − Operating and Capital Efficiency  Outlook 3

  4. Slide 4: Dow Delivers Adjusted EPS of $0.61 Per Share

    Dow Delivers Adjusted EPS of $0.61 Per Share 10th Consecutive Quarter of Y-O-Y Top-line Growth; Record Ag Performance  Reported EPS of $0.35, or adjusted EPS of $0.61 – Certain items included a restructuring-related charge of $0.25 per share  Sales of $14.7B, adjusted sales up 4% – Volume grew 3%;

  5. Slide 5: Earnings Growth Trajectory Remains Intact

    Earnings Growth Trajectory Remains Intact Feedstock Advantage Margin Expansion / Organic Growth Integrated Portfolio Efficiency for Growth Innovation ~$1.5B of $10B incremental EBITDA $8.4B $7.5B $5.5B Near 2009(1) 2010 2011 Term (1) Pro forma, reflecting the combination of historical information of

  6. Slide 6: Agenda

    Agenda  1Q 2012 Overview  Drivers to Deliver Shareholder Value − Feedstock Advantage − Integrated Portfolio − Innovation Agenda − Operating and Capital Efficiency  Outlook 6

  7. Slide 7: Clear Drivers to Deliver Shareholder Value

    Clear Drivers to Deliver Shareholder Value  Largest, most flexible and experienced ethylene producer Feedstock  70% of ethylene production in cost-advantaged regions Advantage  Shale gas dynamics & USGC investments drive EBITDA upside of ~$2B/year in 2017  Strategically aligned with key end-mark

  8. Slide 8: Ethylene Industry Dynamics Remain Strong

    Ethylene Industry Dynamics Remain Strong Dow EBITDA Growth from Ethylene Derivatives Drivers Persistently Favorable Oil-to- Naphtha-to-Ethane Ratio Gas Ratio  Crude oil $105+…leading to high naphtha costs  Upward pressure on ethylene derivative prices  Nat gas forecast ~$4/mmbtu Structurally long

  9. Slide 9: Feedstock Advantage Bolsters Downstream Profitability

    Feedstock Advantage Bolsters Downstream Profitability Key Future Investments Feedstocks & Energy  Driven by downstream needs Performance Plastics – St. Charles cracker: YE 2012  Performance – PDH in Texas: 2015 Ethylene Packaging  Dow Elastomers – New cracker in Freeport: 2017  Dow Electrical &

  10. Slide 10: Dow's Portfolio Can Pivot to Optimize Returns

    Dow’s Portfolio Can Pivot to Optimize Returns Shorter-Term Integration Value Drivers Ability to arbitrage within and across multiple value Optimization of chains price and volume Geographic Breadth Exposure to fastest growing markets; Investments address growing middle-class Energy Longer-Term Indus

  11. Slide 11: Delivering On Our Innovation Agenda

    Delivering On Our Innovation Agenda Product Status Product Status DOW POWERHOUSE™ Solar Launched EMBARK™ Rheology Modifier in Launched Shingle Oil & Gas EcoSmooth™ satin conditioning Launched New VORAFORCE™ for composite Launched polymer fabrication Solid State Lighting growth Launched VORATRON™ sys

  12. Slide 12: On Track to Achieve Efficiency and Cost Targets

    On Track to Achieve Efficiency and Cost Targets Total Levers $2.5B Interventions Underway $1B  On track to deliver $250MM of Actively Manage $1.5B cost reductions in 2012 CapEx & Growth Additional Spending Levers – April 2: Announced selective downsizing / shutdown of assets to Poised to reduce str

  13. Slide 13: Strong Cash Flow Generation and Clear Uses of Cash

    Strong Cash Flow Generation and Clear Uses of Cash  Deleveraging: Reduced >$1B of debt in 1Q12  Invest for Growth: Prudent investments for organic growth  Shareholder Remuneration: Raised dividend 28% Cash Flow from Operations Dividend Payout Ratio* 100% 80% Average Payout Ratio 60% $8 Billion 40

  14. Slide 14: Agenda

    Agenda  1Q 2012 Overview  Drivers to Deliver Shareholder Value − Feedstock Advantage − Integrated Portfolio − Innovation Agenda − Operating and Capital Efficiency  Outlook 14

  15. Slide 15: Macroeconomic Outlook

    Macroeconomic Outlook  United States is strengthening – Improvement in consumer confidence bolstered by moderated gas prices, cautious optimism on housing starts and remodeling investments – Tailwinds from abundant access to low-cost natural gas  Europe headwinds persist – Ongoing challenges with

  16. Slide 16: Near-Term Priorities

    Near-Term Priorities PRIORITIES  Pivot our portfolio to mitigate volatility and risks Strategic  Deliver on our innovation agenda  Drive organic growth in attractive segments and regions  Focus on the actions in our control Operational • Safe and reliable operations • Price / volume management 

  17. Slide 17: La.

    La. 17

The Dow Chemical Company — Deutsche Bank Global Industrials and Basic Materials Conference 2012 on 6ix