Rohm & Haas — Q1 2008 Earnings Presentation
23 slides from Rohm & Haas's earnings presentation, Apr 22, 2008
Slide 1: First Quarter 2008 Earnings Release
First Quarter 2008 Earnings Release April 21, 2008 accelerate:
Slide 2: Regulation G
Regulation G The presentation today may include the display of some company data that do 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 operations
Slide 3: Forward Looking Statement
Forward Looking Statement The presentation today includes forward-looking statements. Actual results could vary materially, due to changes in current expectations. The forward-looking statements contained in this presentation concerning demand for products and services, sales and earnings forecasts,
Slide 4: Results At A Glance
Results At A Glance Excellent demand growth, especially in Electronic Technologies Strong performance from Salt across the board Strong chemicals growth in Rapidly Developing Economies Good progress on price increases Strong earnings growth in Electronic Technologies (+16%), Performance Materials (+
Slide 5: Q1 2008 Financial Highlights
Q1 2008 Financial Highlights Three Months Ended March 31, Three Months Ended March 31, Three Months Ended March 31, In Millions (except EPS) 2008 2007 Change Sales $2,507 $2,160 16% Net Earnings from Continuing Operations $172 $190 (9)% Diluted EPS $0.87 $0.86 1% Adjusted Net Earnings from Continuin
Slide 6: Q1 2008 Sales Change
Q1 2008 Sales Change Invisible Black Grey Q1 2007 0 2160 Demand 2160 129 Price 2289 54 Currency 2343 95 Other 2438 69 Q1 2008 0 2507 Strong Organic Growth Strong demand growth, led by Salt (+17%) and Electronic Technologies (+11%) Good progress on price increases US dollar weaker than anticipated 6%
Slide 7: Q1 2008 Earnings Change
Q1 2008 Earnings Change Invisible Black Grey Q1 2007 0 0.86 0.86 0.07 0.05 0.04 0.91 0.04 0.03 0.03 0 Reduced Share Count 0.91 0.06 Lower Tax Rate 0.97 0.03 Increase in Corporate Expense 0.91 0.09 Increase in Minority Interest 0.91 0.01 Q1 2008 0 0.91 Year-on-Year Change in Adjusted Earnings per Sha
Slide 8: Vision 2010 Scorecard for Q1 2008
Vision 2010 Scorecard for Q1 2008 Metrics Q1 2008 Trailing 12 Months 2008 Target '06-'10 Target CAGR Revenue Growth Total Company Mature Economies RDEs 16% 10% 42% 11% 6% 29% 12% 7% 30% Demand Growth 6% 5% 5% 5-7% % Sales in RDEs 25% 25% 28% 35% Adjusted EPS Growth(1, NG) 6% 1% 11% - 17% 12-14% EBIT
Slide 9: Trailing Twelve Month (TTM) Trends
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 FY 2008G 0.04 TTM Demand Growth(1) TTM RDEs % of Total(1) TTM Adjusted EPS Growth(1,2,NG) 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
Slide 10: Electronic Technologies Q1 2008 Highlights
Invisible Black Grey Q1 2007 0 381 Demand 381 43 Price 424 4 Currency 428 13 Other 440 1 Q1 2008 0 441 Electronic Technologies Q1 2008 Highlights Sales Change Pre-Tax Earnings Comparison OPBT Q1 2007 87 Q1 2008 101 11% 1% 3% 16% Strong demand growth in Asia, aided by gains at key customers with adva
Slide 11: Display Technologies Q1 2008 Highlights
Invisible Black Grey Q1 2007 0 3.13 Demand 3.13 0.89 Price 3.84 0.18 Currency 3.84 0.22 Other 4.06 78.53 Q1 2008 0 82.59 Display Technologies Q1 2008 Highlights Sales Change Pre-Tax Earnings Comparison OPBT Q1 2007 -0.4 Q1 2008 -11 SKC Haas Display Films JV launched on November 30, 2007 Healthy grow
Slide 12: Paint & Coatings Materials Q1 2008 Highlights
Invisible Black Grey Q1 2007 0 478 Demand 478 5 Price 483 14 Currency 497 14 Other 510 1 Q1 2008 0 510 Paint & Coatings Materials Q1 2008 Highlights Sales Change Pre-Tax Earnings Comparison OPBT Q1 2007 74 Q1 2008 63 1% 3% 3% 6% Strong demand growth in RDEs offset moderating conditions in Western Eu
Slide 13: Packaging & Building Materials Q1 2008 Highlights
Invisible Black Grey Q1 2007 0 448 Demand 440 8 Price 440 9 Currency 449 22 Other 471 1 Q1 2008 0 472 Packaging & Building Materials Q1 2008 Highlights Sales Change Pre-Tax Earnings Comparison OPBT Q1 2007 39 Q1 2008 39 (2)% 2% 5% 5% Strong demand in RDEs was not enough to offset weakness in Western
Slide 14: Primary Materials Q1 2008 Highlights
Invisible Black Grey Q1 2007 0 232 Demand 232 26 Price 258 13 Currency 271 13 Other 280 4 Q1 2008 0 280 Primary Materials Q1 2008 Highlights Sales Change Pre-Tax Earnings Comparison OPBT Q1 2007 42 Q1 2008 34 11% 5% 21% Strong growth in 3rd party sales, particularly of monomers in RDEs Captive volum
Slide 15: Performance Materials Q1 2008 Highlights
Invisible Black Grey Q1 2007 0 290 Demand 290 4 Price 294 4 Currency 298 15 Other 310 3 Q1 2008 0 310 Performance Materials Q1 2008 Highlights Sales Change Pre-Tax Earnings Comparison OPBT Q1 2007 28 Q1 2008 40 1% 5% 7% Strong demand growth in incubation businesses (AgroFresh, Advanced Materials) an
Slide 16: Salt Q1 2008 Highlights
Invisible Black Grey Q1 2007 0 327 Demand 327 57 Price 384 10 Currency 394 17 Other 410 1 Q1 2008 0 411 Salt Q1 2008 Highlights Sales Change Pre-Tax Earnings Comparison OPBT Q1 2007 47 Q1 2008 67 17% 5% 26% Ice control demand was strong vs. a slightly below average prior year period Sales for other
Slide 17: Recent Strategic Developments
Recent Strategic Developments Accelerates growth in Russia, CIS and Baltic states; adds non-acrylic and low-temperature technology Exclusive global alliance; partners share costs and profits equally $500 million potential (provisional estimate); commercialization in 2 yrs Secures low-cost, reliable
Slide 18: Macroeconomic Environment Continues to Evolve
Macroeconomic Environment Continues to Evolve No recovery in US B&C markets Similar drop in US paint market as 2007 (5 - 7%) US Paint market volumes drop 7 - 8% vs 2007 No recovery in US B&C markets Continued momentum in Electronics Wafer Starts up ~8% Wafer Starts up ~4 - 6% Continued momentum in E
Slide 19: 2008 Outlook: $10B Sales
2008 Outlook: $10B Sales Robust Sales Growth of 15% Sales Q1 2007A 2.16 Q1 2008A 2.507 Q2 2007A 2.19 Q2 2008G 2.586 H2 2007A 4.548 H2 2008G 5.173 FY 2007A 8.897 FY 2008G 10.266 Full Year Sales Growth of 15% Demand growth 4% Acquisitions made in 2007 and 2008 4% Favorable currencies 4% Price increase
Slide 20: 2008 Outlook: $3.80 - $4.00 EPS
2008 Outlook: $3.80 - $4.00 EPS Accelerating Year-on-Year Earnings Per Share Improvement EPS Q1 2007A 0.78 Q1 2008A 0.91 Q2 2007A 0.78 Q2 2008G 0.87 0.05 H2 2007A 1.78 H2 2008G 2.02 0.15 FY 2007A 3.41 FY 2008G 3.8 0.2 Selling price increases catch up with raw materials by Q3 Continued cost managemen
Slide 21: accelerate: traction
accelerate: traction NYSE: ROH www.rohmhaas.com
Slide 22: Non GAAP Reconciliation
Non GAAP Reconciliation Non GAAP Reconciliation
Slide 23: Non GAAP Reconciliation
Non GAAP Reconciliation Non GAAP Reconciliation