Dow Corning Corp. today announced third quarter sales of $1.52 billion, a 7 percent increase compared to 2013. Net income also increased to $176 million, representing a 49 percent increase compared to the third quarter of 2013. For the year, Dow Corning’s sales ($4.54 billion) and net income ($476 million) have increased 10 and 78 percent, respectively.
J. Donald Sheets, executive vice president and chief financial officer, Dow Corning Corporation (Photo: Business Wire)
Adjusted net income through the third quarter of 2014 was $318 million, an increase of 58 percent compared to 2013. Adjusted net income for 2014 excluded the impact of a derivative contract, long term sales agreements and a tax benefit associated with foreign dividends. Adjusted net income for 2013 excluded the impact of a derivative contract, long term sales agreements, charges for impaired assets and restructuring expenses. Additional information about Dow Corning’s financial results:
Third Quarter Results
- Silicones sales grew in the Americas, Greater China and Europe
- Silicones sales growth increased most significantly for applications in the healthcare, packaging, electronics, high-performance building and transportation industries
| Q3 2014 | Q3 2013 | % Change | 2014 | 2013 | % Change | |||||||||||||
| Sales (in billions) | $ | 1.52 | $ | 1.43 | 7 | % | $ | 4.54 | $ | 4.12 | 10 | % | ||||||
| Net income (in millions) | $ | 176 | $ | 117 | 49 | % | $ | 476 | $ | 267 | 78 | % | ||||||
| Adjusted net income* (in millions) | $ | 109 | $ | 28 | 294 | % | $ | 318 | $ | 201 | 58 | % | ||||||
*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:
- “Dow Corning’s sales increased for the fourth consecutive quarter, demonstrating that our strategy, talented team and technology are well-positioned to deliver the growth expected of a specialty chemicals leader.”
- “Dow Corning’s industry-leading products - combined with our global manufacturing and formulation capabilities - led to record Silicones segment sales in the quarter.”
- “Our Polysilicon segment through the Hemlock Semiconductor Group continued its strong performance in 2014 as long-term contract customers continued to take shipments of material for both semiconductor and solar grade 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 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 September 30, | Nine Months Ended September 30, | |||||||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||||||
| Net Sales | $ | 1,519.9 | $ | 1,426.6 | $ | 4,544.7 | $ | 4,120.9 | ||||||||||||
| Net Income | ||||||||||||||||||||
| Attributable to Dow Corning | $ | 175.5 | $ | 117.4 | $ | 475.6 | $ | 266.7 | ||||||||||||
| Adjustment for Long-Term Sales Agreements1 | $ | - | $ | (134.1 | ) | $ | (17.2 | ) | $ | (134.1 | ) | |||||||||
| Adjustment for Asset Impairment2 | $ | - | $ | 74.0 | $ | - | $ | 74.0 | ||||||||||||
| Adjustment for Contract Asset3 | $ | 15.3 | $ | (32.3 | ) | $ | (58.8 | ) | $ | (32.3 | ) | |||||||||
| Adjustment for Restructuring4, net | $ | - | $ | 2.6 | $ | - | $ | 27.1 | ||||||||||||
| Foreign Tax Credit5 | $ | (82.0 | ) | $ | - | $ | (82.0 | ) | $ | - | ||||||||||
| Adjusted Net Income6 | $ | 108.8 | $ | 27.6 | $ | 317.6 | $ | 201.4 | ||||||||||||
1 | The three month period ended September 30, 2013 and the nine month periods ended September 30, 2014 and September 30, 2013 included adjustments for gains on long term sales agreements. | |
2 | The three and nine month periods ended September 30, 2013 included an adjustment for asset impairment. | |
3 | The three and nine month periods ended September 30, 2014 and September 30, 2013 included adjustments for the changes in market value of a derivative contract asset. | |
4 | The three and nine month periods ended September 30, 2013 included adjustments for restructuring charges. | |
5 | The three and nine month periods ended September 30, 2014 included adjustments for a foreign tax credit. | |
6 | 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 | |||||||||
| September 30, 2014 | December 31, 2013 | ||||||||
| Assets | |||||||||
| Current Assets | $ | 4,327.5 | $ | 3,995.7 | |||||
| Property, Plant and Equipment, Net | 6,893.8 | 7,231.1 | |||||||
| Other Assets | 1,287.0 | 1,075.3 | |||||||
| $ | 12,508.3 | $ | 12,302.1 | ||||||
| Liabilities and Equity | |||||||||
| Current Liabilities | $ | 1,385.4 | $ | 1,346.0 | |||||
| Other Liabilities | 7,103.9 | 7,177.5 | |||||||
| Equity | 4,019.0 | 3,778.6 | |||||||
| $ | 12,508.3 | $ | 12,302.1 | ||||||
Photos/Multimedia Gallery Available: http://www.businesswire.com/multimedia/home/20141029005656/en/
Contacts:
Jarrod Erpelding, 989.496.1582
Jarrod.Erpelding@dowcorning.com
