|By Business Wire||
|February 8, 2013 12:44 PM EST||
Dow Corning Corp. today reported its financial performance for the fourth quarter and full year of 2012. Dow Corning recorded sales of $6.12 billion and net income of $188 million for 2012. Dow Corning’s year-to-date sales and adjusted net income were down 5 percent and 45 percent, respectively, compared to 2011 as oversupply, economic volatility and high raw material costs significantly reduced the company’s profits. Adjusted net income for 2012 excluded charges for asset abandonments and restructuring expenses. Adjusted net income for 2011 excluded a gain on long-term sales agreements. Additional information about Dow Corning’s financial results:
J. Donald Sheets, Dow Corning's executive vice president and chief financial officer (Photo: Business Wire)
Fourth Quarter Results
- Sales were $1.48 billion, 3 percent lower than last year’s fourth quarter.
- Adjusted net income was $69 million, 10 percent lower than last year’s fourth quarter.
- Dow Corning’s Hemlock Semiconductor Group joint ventures continued to be challenged by significant oversupply in the polysilicon industry and the threat of potential duties on its products sold into China.
- Sales in Europe continued to be significantly lower due to continuing economic volatility.
- Sales were $6.12 billion, 5 percent lower than 2011.
- Adjusted net income was $338 million, 45 percent lower than 2011.
|Q4 2012||Q4 2011||% Change||2012||2011||% Change|
|Sales (in billions)||$||1.48||$||1.52||-3%||$||6.12||$||6.43||-5%|
Net income (Loss) (in millions)
|Adjusted net income* (in millions)||$||69||$||77||-10%||$||338||$||613||-45%|
*Adjusted net income is a non-GAAP financial measure which excludes certain unusual items. The reconciliation between GAAP and non-GAAP measures is shown in the table following the news release.
Comments from Dow Corning’s Executive Vice President and Chief Financial Officer J. Donald Sheets:
- “Oversupply in the silicone and polycrystalline silicon industries, as well as persistently high raw material costs and global trade policy instability impacted our financial performance significantly in 2012. While we expect these conditions to last well into 2013, Dow Corning’s strategy for long-term success is clear and robust, and our foundation is financially strong.”
- “We are taking actions to strengthen our ability to maintain our competitive position in the marketplace and enable us to continue to invest in developing innovative products for our customers.”
- “We have a strong product portfolio that includes a mix of world-class, highly differentiated products together with a balanced portfolio of highly innovative new materials to ensure our long-term success. We also continue to aggressively pursue opportunities to increase efficiency and reduce costs in our operations.”
- “The unresolved trade disputes among the U.S., China and Europe are a major factor in Hemlock Semiconductor’s business, as the threat of tariffs on U.S. polysilicon imported into China has significantly decreased orders from China, which is home to one of the largest markets for solar polysilicon.”
About Dow Corning
Dow Corning (www.dowcorning.com) provides performance-enhancing solutions to serve the diverse needs of more than 25,000 customers worldwide. A global leader in silicones, silicon-based technology and innovation, Dow Corning offers more than 7,000 products and services via the company’s Dow Corning® and XIAMETER® brands. Dow Corning is equally owned by The Dow Chemical Company (NYSE:DOW) and Corning, Incorporated (NYSE:GLW). More than half of Dow Corning’s annual sales are outside the United States.
About Hemlock Semiconductor Group
Hemlock Semiconductor Group (Hemlock Semiconductor) is comprised of several joint venture companies among Dow Corning Corporation, Shin-Etsu Handotai, and Mitsubishi Materials Corporation. Hemlock Semiconductor is a leading provider of polycrystalline silicon and other silicon-based products used in the manufacturing of semiconductor devices, and solar cells and modules. Hemlock Semiconductor began its operations in 1961.
|Dow Corning Corporation|
|Selected Financial Information|
|(in millions of U. S. dollars)|
|Consolidated Income Statement Data|
|Three Months Ended December 31,||Twelve Months Ended December 31,|
|Net Income (Loss)|
|Attributable to Dow Corning||$||(100.7||)||$||259.7||$||187.7||$||806.2|
|Adjustment for Asset Abandonments and Restructuring1||$||169.5||$||-||$||169.5||$||-|
|Adjustment for Long-Term Sales Contracts2||$||-||$||(177.6||)||$||(19.7||)||$||(177.6||)|
|Adjustment for AEMC3, net||$||-||$||(5.3||)||$||-||$||(15.8||)|
|Adjusted Net Income4||$||68.8||$||76.8||$||337.5||$||612.8|
1 The three and twelve month periods ended December 31, 2012 included an adjustment for asset abandonments and restructuring charges.
2 The twelve month period ended December 31, 2012 and the three and twelve month periods ended December 31, 2011 included adjustments for gains on long-term sales agreements.
3 The three and twelve month periods ended December 31, 2011 included a tax benefit related to Advanced Energy Manufacturing Credits.
4 Adjusted Net Income is a non-GAAP financial measure which excludes certain unusual items and which reconciles to Net Income as shown.
|Consolidated Balance Sheet Data|
|December 31, 2012||December 31, 2011|
|Property, Plant and Equipment, Net||7,553.1||7,380.3|
|Liabilities and Equity|
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