Dupont De Nemours, Inc. · NYSE:DD
Dupont De Nemours — FY2019 Earnings Presentation
26 slides from Dupont De Nemours's earnings presentation, Jan 30, 2020
Slide 1: DuPont 4Q and Full Year 2019 Earnings Conference Call
DuPont 4Q and Full Year 2019 Earnings Conference Call January 30, 2020
Slide 2: Full Year 2019 Financial Highlights
Full Year 2019 Financial Highlights NET SALES ORGANIC PRO FORMA PRO FORMA PRO FORMA $21.5 billion SALES(1) OPERATING OPERATING ADJUSTED EPS(1) -5% -2% EBITDA(1) EBITDA MARGIN(2) $3.80 $5.6 billion +10 bps Net Sales of $21.5B Pro forma operating EBITDA Margin of Pro forma adjusted EPS(1) of $3.80 Por
Slide 3: Full Year 2019 Net Sales Bridge
Full Year 2019 Net Sales Bridge ------------------- Organic Sales(1) Change --------------- -1% -2% Divestments of: -2% • Natural Colors -1% +1% $22,594 (N&B) Strengthening of USD, primarily -7% Interconnect Food & +3% -10% • EU Styrofoam vs. Euro Solutions in Millions (S&C) Beverage Mobility Water
Slide 4: Full Year 2019 Pro Forma Adjusted EPS Bridge
Full Year 2019 Pro Forma Adjusted EPS(1) Bridge ($0.12) $4.07 Pricing gains ($0.16) Synergies & cost ($0.05) actions $0.13 Strengthening of EGL(2) (-$0.10) Volume / ($0.21) 3% lower share Other $0.05 $3.80 USD, primarily production $0.14 count due to ($0.08) vs. the Euro declines repurchases Base ta
Slide 5: Progress Against 2019 Priorities
Progress Against 2019 Priorities Drive top line growth through › Delivered 2% price improvement innovation and pricing discipline › Headwinds from automotive and electronic markets negatively impacted volume Expand margins through strong › 10 basis points of pro forma operating EBITDA(1) margin impr
Slide 6: 2020 Priorities
2020 Priorities Drive top line growth through › Organic top-line growth across all core segments except T&I innovation and pricing discipline › Nylon market pressures negatively impacting T&I results Expand margins through strong › $215 million of incremental savings from synergy program and prior c
Slide 7: Cost Actions
Cost Actions 2020 Expected Full Run Rate Action Savings Expected Savings DowDuPont Synergies & 2019 Restructuring ~$215 million ~$215 million › Expected timing: 1Q 2020 through 4Q 2020 › Programs in place and being executed Incremental 2020 Cost Actions › Expected timing: 2Q 2020 through 1Q 2021 ~$9
Slide 8: 2020 Organic Sales Growth Expectations
2020 Organic Sales(1) Growth Expectations Electronics & Nutrition & Transportation Safety & Imaging Biosciences & Industrial Construction Non-Core 2% to 5% 3% to 4% -3% to -5% 2% to 3% -3% to -5% Total company organic growth slightly up versus prior year (1) Organic sales is a non-GAAP measure. See
Slide 9: Full Year 2020 Adjusted EPS Guidance
Full Year 2020 Adjusted EPS(1) Guidance $0.08 $0.10 ($0.23) $0.12 $0.12 ($0.28) ($0.08) $0.03 $0.14 $3.80 $3.80 Key Drivers Key Drivers • ~($0.14) from HSC • ~$0.08 gain from customer settlement HSC customer • ~($0.08) associated settlement with OLED • ~($0.05) erosion in Technology sale HSC-related
Slide 10: First Quarter 2020 Adjusted EPS Guidance
First Quarter 2020 Adjusted EPS(1) Guidance $0.09 ($0.08) $0.03 ($0.08) $0.92 ($0.13) Key Drivers ($0.16) • ~($0.05) lower ($0.08) $0.06 S&C EBITDA $0.72 primarily due to ($0.21) operational issues • ~($0.05) lower Non-Core earnings primarily due to HSC-related headwinds • ~$0.03 N&B improvement Seg
Slide 11: 4Q 2019 Financial Highlights
4Q 2019 Financial Highlights NET SALES ORGANIC OPERATING OPERATING ADJUSTED EPS(1) $5.2 billion SALES(1) EBITDA EBITDA(1) $0.95 -5% -2% MARGIN(2) $1.4 billion 26.7% Net Sales of $5.2B Gross margins flat with Adjusted EPS(1) of $0.95 Portfolio (2%), Currency (1%), Volume (3%), Price +1% 4Q 2018 versu
Slide 12: 4Q 2019 Net Sales Bridge
4Q 2019 Net Sales Bridge ------------------- Organic Sales(1) Change --------------- -2% -2% +3% Flat Divestments of: -1% $5,457 -8% Strengthening of Interconnect Health & +1% • Natural Colors USD, primarily Solutions Biosciences -9% (N&B) vs. Euro in Millions Pharma Mobility Water Solutions PV & Ad
Slide 13: 4Q 2019 Adjusted EPS Bridge
4Q 2019 Adjusted EPS(1) Bridge $1.43 ($0.25) $0.03 Pricing gains in all segments ex. T&I ($0.22) $0.03 $0.96 $0.04 Synergies & cost ($0.08) actions Base tax rate: Lower amortization 3% lower share count EGL (-$0.05) Volume / production • 4Q’19 – 22.3% and absence of due to repurchases Interest (-$0.
Slide 14: Balance Sheet and ROIC
Balance Sheet and ROIC Net Debt Cash and Debt Levels(1) › $15.9 billion net financial debt at December 31, 2019 › Includes $1.8 billion commercial paper Gross Debt Cash Net Debt 16 2019 Uses of Cash › Dividends - $450 million since June 1 ($900 million run-rate) 12 $ Billions › Share repurchase - $7
Slide 15: Electronics & Imaging
Electronics & Imaging 4Q Net Sales Vol +2%, Local Price +1%, Currency 0%, Portfolio 0% 937 $ in Millions 910 4Q 2019 Highlights Fourth quarter net sales of $937 million were up 3 percent. Organic sales improved 3 percent driven by 2 4Q Operating EBITDA percent growth in volume and a 1 percent gain i
Slide 16: Nutrition & Biosciences
Nutrition & Biosciences 4Q Net Sales Vol -1%, Local Price +1%, Currency -2%, Portfolio 0% $ in Millions 1,485 1,458 4Q 2019 Highlights Fourth quarter net sales of $1.5 billion were down 2 percent. Organic sales were flat with a 1 percent pricing improvement offset by a 1 percent decline in volume. W
Slide 17: Transportation & Industrial
Transportation & Industrial 4Q Net Sales Vol -6%, Local Price -2%, Currency -1%, Portfolio 0% $ in Millions 1,270 1,155 4Q 2019 Highlights 4Q Operating EBITDA Fourth quarter net sales of $1.2 billion were down 9 percent. Organic sales were down 8 percent with volume down 6 percent and price lower by
Slide 18: Safety & Construction
Safety & Construction 4Q Net Sales Vol -2%, Local Price +3%, Currency -1%, Portfolio -3% 1,294 $ in Millions 1,250 4Q 2019 Highlights Fourth quarter net sales of $1.3 billion were down 3 percent. Organic sales were up 1 percent with a 3 percent 4Q Operating EBITDA price improvement offset by a 2 per
Slide 19: Sources & Uses of Cash – 2020 Expectations
Sources & Uses of Cash – 2020 Expectations Sources of Cash Uses of Cash Investment Other Recurring Uses R&D ~ $900 million Strong Cash From Multi-year working Interest ~ $660 million [4% of Sales] Operations with Free capital improvement Cash Flow Conversion opportunity of CapEx* ~ $1.1 billion Inco
Slide 20: N&B & IFF Update
N&B & IFF Update Significant Milestones Achieved Key Activities Underway ✓ Agreement announced on December 15, 2019 ✓ Separation & integration planning across 12 workstreams ✓ IFF’s largest shareholder agreed to vote in favor of the transaction ✓ Carve-out financials ✓ Integration leaders named: ✓ I
Slide 21: Appendix
Appendix
Slide 22: 1Q and FY 2020E Segment Guidance
1Q and FY 2020E Segment Guidance 1Q Net Sales expected to be flat versus the prior year as reported and up low-single digits on an organic basis on stronger volumes partially offset by lower price. 1Q operating EBITDA is expected to be down high-teens percent primarily from the absence of a gain ass
Slide 23: Additional Modeling Guidance – Full Year 2020
Additional Modeling Guidance – Full Year 2020 Additional Modeling Guidance – FY2020E Base Tax Rate 20% - 22% Share count – diluted ~740 million D&A(1) – Includes Merger-Related Amortization ~$3,110 million, pre tax Merger-Related Amortization(1) ~$1,920 million, pre tax Interest Expense, net ~$660 m
Slide 24: Safe Harbor Statement
Safe Harbor Statement Cautionary Statement Regarding 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
Slide 25: Safe Harbor Statement
Safe Harbor Statement Cautionary Statement About Forward-Looking Statements, continued Unaudited Pro Forma Financial Information: The unaudited pro forma financial information (the “pro forma financial statements”) is derived from DuPont’s interim Consolidated Financial Statements and accompanying n
Slide 26: Trademarks and copyright notice
© 2019 DuPont de Nemours, Inc. All rights reserved. © 2019 DuPont. All rights reserved. DuPont™, the DuPont Oval Logo, and all trademarks and service marks denoted with ™, ℠ or ® are owned by affiliates of DuPont de Nemours, Inc. unless otherwise noted. Nothing contained herein shall be construed as