Dow Corning Corp. today announced fourth quarter 2013 sales of $1.59 billion, an increase of 7 percent over 2012, and net income of $110 million. Adjusted net income in the fourth quarter was $103 million, an increase of 50 percent compared with the fourth quarter of 2012. For the year, Dow Corning’s sales were $5.71 billion, a decrease of 7 percent compared to 2012, and net income was $376 million. Adjusted net income for 2013 was $304 million, a decrease of 10 percent from 2012.
Adjusted net income for both 2013 and 2012 excluded gains from long term sales agreements, restructuring expenses and charges for impaired assets. Additionally, adjusted net income for 2013 excluded a gain from a favorable derivative contract.
Additional information about Dow Corning’s financial results:
Fourth Quarter Results
-- Sales were $1.59 billion, 7 percent higher than last year's fourth
quarter.
-- Pricing pressure continued to limit margins in Dow Corning's Silicones
segment.
-- Polysilicon segment performance increased as customers purchased high
volumes to meet contractual requirements.
Year-to-Date Results
-- Sales were $5.71 billion, 7 percent lower than last year.
-- Adjusted net income was $304 million, 10 percent lower than last year.
Q4 2013 Q4 2012 % Change 2013 2012 % Change
-------------- -------- --------- ---------- ----- ----- ----------
Sales (in
billions) $ 1.59 $ 1.48 7% $5.71 $6.12 -7%
-------------- ---- ---- ----- ---- ---- -----
Net income (in
millions) $ 110 $ (101) 209% $ 376 $ 188 100%
-------------- ---- ---- ----- ---- ---- -----
Adjusted net
income* (in
millions) $ 103 $ 69 50% $ 304 $ 338 -10%
-------------- ---- ---- ----- ---- ---- -----
*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:
-- "In a year characterized by significant oversupply and pricing pressure
in our industry, Dow Corning competed well to maintain its industry
leading financial foundation. We moved decisively to reduce our cost
structure in 2013, providing us the ability to focus on growth through
serving our customers in 2014 and beyond."
-- "Dow Corning continues to remain strong financially. In the past year
we've paid down debt and maintained stable cash levels, carrying a strong
balance sheet which will enable us to adapt and invest in the growth of
our business."
-- "We continue to manufacture and sell high volumes of materials in our
Silicones segment. Our efforts to continually improve the efficiency of
our manufacturing operations have been a significant factor in our
ability to compete in this volatile economic environment."
-- "In our polysilicon segment, Hemlock Semiconductor Group delivered
positive financial performance despite unprecedented pricing and volume
pressure as the solar industry deals with excess capacity and awaits
resolution of the global trade disputes."
-- "In 2014, we are in a strong position to focus on growth by providing our
customers with industry leading products and services. We are confident
that our product portfolio and talented team are well positioned to help
return Dow Corning to the trajectory of growth we expect."
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(R) and XIAMETER(R) brands. Dow Corning is equally owned by The Dow Chemical Company and Corning, Incorporated. More than half of Dow Corning’s annual sales are outside the United States.
About Hemlock Semiconductor Group
Hemlock Semiconductor Group (hscpoly.com) is comprised of several joint venture companies owned in majority by Dow Corning 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)
(Unaudited)
Consolidated Income Statement Data
Three Months Ended Twelve Months Ended
December 31, December 31,
2013 2012 2013 2012
------------ --------- ------------ -----------
Net Sales $1,589.6 $1,480.2 $5,710.5 $6,118.5
Net Income
Attributable to
Dow Corning $ 109.6 $ (100.7) $ 376.3 $ 187.7
Adjustment for
Asset Abandonments
and
Restructuring(1) ,
net $ 1.1 $ 169.5 $ 28.2 $ 169.5
Adjustment for Long
Term Sales
Agreements(2) $ - $ - $ (134.1) $ (19.7)
Adjustment for
Asset
Impairment(3) $ - $ - $ 74.0 $ -
Adjustment for
Contract Asset(4) $ (7.8) $ - $ (40.1) $ -
------- ------- ------- -------
Adjusted Net
Income(5) $ 102.9 $ 68.8 $ 304.3 $ 337.5
======= ======= ======= =======
(1) The three and twelve month periods ended December 31, 2013 and December
31, 2012 included adjustments for asset abandonments and restructuring
charges.
2 The twelve month periods ended December 31, 2013 and December 31, 2012
included adjustments for gains on long term sales agreements.
3 The twelve month period ended December 31, 2013 included an adjustment
for asset impairment.
4 The three and twelve month periods ended December 31, 2013 included an
adjustment for recognition of a favorable derivative contract asset and
subsequent changes in market value.
5 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, 2013 December 31, 2012
------------------- -------------------
Assets
Current Assets $ 3,995.7 $ 4,117.3
Property, Plant and Equipment, Net 7,231.1 7,553.1
Other Assets 1,075.3 1,630.5
--------------- ---------------
$ 12,302.1 $ 13,300.9
=============== ===============
Liabilities and Equity
Current Liabilities $ 1,346.0 $ 1,513.5
Other Liabilities 7,177.5 8,214.2
Equity 3,778.6 3,573.2
--------------- ---------------
$ 12,302.1 $ 13,300.9
=============== ===============
CONTACT: Dow Corning Corp.
Jarrod Erpelding, 989.496.1582
Jarrod.Erpelding@dowcorning.com
SOURCE: Dow Corning Corp.
Copyright Business Wire 2014
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