Rohm & Haas — Q3 2008 Earnings Presentation
22 slides from Rohm & Haas's earnings presentation, Oct 22, 2008
Slide 1: Third Quarter 2008 Earnings Release
Third Quarter 2008 Earnings Release October 22, 2008 accelerate:
Slide 2: Regulation G
[ 1 ] Regulation G This presentation may include the display of some company data that does not directly conform to generally acceptable accounting principles, or GAAP. Management believes that the presentation of some non-GAAP data provides investors with additional insight into the ongoing operati
Slide 3: Forward Looking Statements
[ 2 ] Forward Looking Statements This presentation contains forward-looking statements that involve risks and uncertainties and are subject to change based on various factors. These factors include, but are not limited to (1) the cost of raw materials, natural gas, and other energy sources, and the
Slide 4: Dow Chemical Announcement
[ 3 ] Dow Chemical Announcement On July 10, 2008, Dow (NYSE: DOW) and Rohm and Haas (NYSE: ROH) announced a definitive agreement, under which Dow will acquire all outstanding shares of Rohm and Haas common stock for $78 per share in cash. In light of this announcement, Rohm and Haas discontinued its
Slide 5: Results At A Glance
[ 4 ] Results At A Glance Substantial traction on pricing actions Significant market demand erosion for Chemicals in North America and Western Europe Industry-wide slowdown in demand for semiconductors and electronic devices RDEs demonstrated continued solid growth Proactive cost control and pricing
Slide 6: Q3 2008 Financial Highlights
[ 5 ] Q3 2008 Financial Highlights Three Months Ended September 30, Three Months Ended September 30, Three Months Ended September 30, In Millions (except EPS) 2008 2007 Change Sales $2,471 $2,204 12% Net Earnings from Continuing Operations $129 $129 0% Diluted EPS $0.66 $0.61 8% Adjusted Net Earning
Slide 7: Q3 2008 Sales Change
[ 6 ] Q3 2008 Sales Change Invisible Black Grey Q3 2007 0 2204 Demand 2130 74 Price 2130 182 Currency 2312 82 Other 2394 77 Q3 2008 0 2471 Strong traction on pricing actions Strong traction on price increases - pricing for total company up roughly $180 million in Q3 vs. prior-year period Favorable c
Slide 8: Adjusted EPS Up 3%
[ 7 ] Adjusted EPS(1,NG) Up 3% Q3 2007 as reported 0 0.61 Pension Charge 0.61 0.2 Restructuring 0.81 0.06 = Q3 2007 Adjusted EPS 0 0.87 Q3 2008 as reported 0 0.66 Dow Transaction 0.66 0.09 Hurricanes 0.75 0.07 Restructuring 0.82 0.08 Q3 2008 Adjusted EPS 0 0.9 Reconciliation of Adjusted Earnings per
Slide 9: Q3 2008 Earnings Change
[ 8 ] Q3 2008 Earnings Change Excludes special items Performance Materials results were flat year on year Share count impact is net of incremental interest expense related to the 2007 Accelerated Share Repurchase (NG) Non-GAAP measure; see reconciliation in the Appendix Q3 2007 0 0.87 0.87 0.01 0.01
Slide 10: Vision 2010 Scorecard for Q3 2008
[ 9 ] Vision 2010 Scorecard for Q3 2008 Metrics Q3 2008 Trailing 12 Months '06-'10 Target Revenue Growth Total Company Mature Economies RDEs 12% 8% 25% 15% 9% 35% Demand Growth (3)% 4% 5-7% CAGR % Sales in RDEs 28% 27% 35% EBITDA(NG) $ Growth 1% 3% 10-12% CAGR Conversion Cost Index(1) n/a 106.3 100
Slide 11: Trailing Twelve Month (TTM) Trends
[ 10 ] Trailing Twelve Month (TTM) Trends Q4 2006 0.03 Q1 2007 0.02 Q2 2007 0.02 Q3 2007 0.02 Q4 2007 0.04 Q1 2008 0.05 Q2 2008 0.06 Q3 2008 0.04 TTM Demand Growth(1) TTM RDEs % of Total(1) TTM EBITDA Growth(1,NG) Q4 2006 0.21 Q1 2007 0.21 Q2 2007 0.22 Q3 2007 0.23 Q4 2007 0.24 Q1 2008 0.25 Q2 2008
Slide 12: Electronic Technologies Q3 2008 Highlights
[ 11 ] Invisible Black Grey Q3 2007 0 434 Demand 418 15 Price 434 0 Currency 418 16 Other 0 0 Q3 2008 0 434 Electronic Technologies Q3 2008 Highlights Sales Change Adjusted Pre-Tax Earnings Comparison (1, NG) OPBT Q3 2007 111 Q3 2008 94 (4)% 0% 4% 0% Sales flat, reflecting a broad based slowdown in
Slide 13: Display Technologies Q3 2008 Highlights
[ 12 ] Invisible Black Grey Q3 2007 0 9 Demand 8 0 1 Price 7 0 1 Currency 0 0 Other 7 66 Q3 2008 0 73 Display Technologies Q3 2008 Highlights Sales Change Adjusted Pre-Tax Earnings Comparison (1, NG) OPBT Q3 2007 -10 Q3 2008 -8 SKC Haas Display Films JV launched on November 30, 2007; acquired Gracel
Slide 14: Paint & Coatings Materials Q3 2008 Highlights
[ 13 ] Invisible Black Grey Q3 2007 0 570 Demand 531 39 Price 531 77 Currency 608 12 Other 620 17 Q3 2008 0 636 Paint & Coatings Materials Q3 2008 Highlights Sales Change Adjusted Pre-Tax Earnings Comparison (1, NG) OPBT Q3 2007 98 Q3 2008 80 (7)% 13% 2% 12% 12 percent increase, primarily due to tim
Slide 15: Packaging & Building Materials Q3 2008 Highlights
[ 14 ] Invisible Black Grey Q3 2007 0 460 Demand 411 49 Price 411 41 Currency 452 24 Other 476 0 Q3 2008 0 476 Packaging & Building Materials Q3 2008 Highlights Sales Change Adjusted Pre-Tax Earnings Comparison (1, NG) OPBT Q3 2007 43 Q3 2008 35 (11)% 9% 5% 3% Increase reflects higher selling prices
Slide 16: Primary Materials Q3 2008 Highlights
[ 15 ] Invisible Black Grey Q3 2007 0 248 Demand 245 15 Price 259 45 Currency 302 11 Other 309 4 Q3 2008 0 314 Primary Materials Q3 2008 Highlights Sales Change Adjusted Pre-Tax Earnings Comparison (1, NG) OPBT Q3 2007 24 Q3 2008 28 6% 5% 28% Third-party sales up 28%, reflecting higher selling price
Slide 17: Performance Materials Q3 2008 Highlights
[ 16 ] Performance Materials Q3 2008 Highlights Sales Change Adjusted Pre-Tax Earnings Comparison (1, NG) OPBT Q3 2007 44 Q3 2008 43 Currencies, increased demand in RDEs and higher selling prices more than offset weakness in North America Increased demand, particularly in Process Chemicals and Bioci
Slide 18: Salt Q3 2008 Highlights
[ 17 ] Invisible Black Grey Q3 2007 0 191 Demand 191 11 Price 202 11 Currency 213 1 Other 214 2 Q3 2008 0 216 Salt Q3 2008 Highlights Sales Change Adjusted Pre-Tax Earnings Comparison (1, NG) OPBT Q3 2007 11 Q3 2008 13 6% 1% 14% Sales increase driven by pricing management, improved mix, increased de
Slide 19: accelerate: traction
[ 18 ] accelerate: traction NYSE: ROH www.rohmhaas.com
Slide 20: Non-GAAP Reconciliations
[ 19 ] Non-GAAP Reconciliations
Slide 21: Non-GAAP Reconciliations
[ 20 ] Non-GAAP Reconciliations
Slide 22: Non-GAAP Reconciliations
[ 21 ] Non-GAAP Reconciliations