DuPont to Begin Reporting "Operating Earnings" in 2013
WILMINGTON, Del., Dec. 13, 2012 /PRNewswire/ -- DuPont announced the introduction of operating earnings as the basis for reporting results to provide more transparency to the company's operational results and pension costs. The company defines operating earnings (non-GAAP) as earnings from continuing operations (GAAP) excluding significant items and non-operating pension and other postretirement employee benefit (OPEB) costs, which are impacted by changes in interest rates and plan returns. The pension/OPEB service cost component is included in operating earnings as this reflects the ongoing costs of providing postretirement benefits to the company's eligible employees.
"We believe this reporting change provides investors with better transparency to operational results by reducing volatility in earnings due to non-operational factors, such as fluctuations in discount rates and return on plan assets," said DuPont Executive Vice President and CFO Nicholas C. Fanandakis. "This change, which is better aligned with management's decision-making process, also allows for better comparison of each business's operating results to their peer companies' operating results that have different benefit structures."
DuPont will begin reporting operating earnings in 2013. For the nine-month period ended Sept. 30, 2012, non-operating pension/OPEB costs were approximately $.36 per share on a continuing operations basis. The company has provided additional information regarding this change in reporting as well as a summary of operating earnings and segment earnings by quarter for 2010, 2011 and third quarter year-to-date 2012 on the DuPont Investor Center website at www.investors.dupont.com.
Use of Non-GAAP Measures
Management believes that certain non-GAAP measurements are meaningful to investors because they provide insight with respect to ongoing operating results of the company. Such measurements are not recognized in accordance with generally accepted accounting principles (GAAP) and should not be viewed as an alternative to GAAP measures of performance.
DuPont (NYSE: DD) has been bringing world-class science and engineering to the global marketplace in the form of innovative products, materials, and services since 1802. The company believes that by collaborating with customers, governments, NGOs, and thought leaders we can help find solutions to such global challenges as providing enough healthy food for people everywhere, decreasing dependence on fossil fuels, and protecting life and the environment. For additional information about DuPont and its commitment to inclusive innovation, please visit http://www.dupont.com.
Forward-Looking Statements: This news release contains forward-looking statements which may be identified by their use of words like "plans," "expects," "will," "anticipates," "believes," "intends," "estimates" or other words of similar meaning. All statements that address expectations or projections about the future, including statements about the company's growth strategy, product development, regulatory approval, market position, anticipated benefits of acquisitions, outcome of contingencies, such as litigation and environmental matters, expenditures and financial results, are forward-looking statements. Forward-looking statements are not guarantees of future performance and are based on certain assumptions and expectations of future events which may not be realized. Forward-looking statements also involve risks and uncertainties, many of which are beyond the company's control. Some of the important factors that could cause the company's actual results to differ materially from those projected in any such forward-looking statements are: fluctuations in energy and raw material prices; failure to develop and market new products and optimally manage product life cycles; significant litigation and environmental matters; failure to appropriately manage process safety and product stewardship issues; changes in laws and regulations or political conditions; global economic and capital markets conditions, such as inflation, interest and currency exchange rates; business or supply disruptions; security threats, such as acts of sabotage, terrorism or war, weather events and natural disasters; inability to protect and enforce the company's intellectual property rights; and integration of acquired businesses and completion of divestitures of underperforming or non-strategic assets or businesses. The company undertakes no duty to update any forward-looking statements as a result of future developments or new information.