Dow Chemical 2014 Annual Report Download - page 69

45
charges, primarily related to the shutdown of certain assets in Dow Automotive Systems, and an $8 million charge related to
Dow Corning's restructuring and asset abandonment. See Notes 3 and 8 to the Consolidated Financial Statements for additional
information on these charges.
Consumer Solutions Outlook for 2015
Consumer Solutions sales are expected to grow in 2015. Consumer Care sales are expected to increase driven by higher
demand for cellulosics used in food and pharmaceutical applications and in home and personal care products. Dow Automotive
Systems sales volume is expected to achieve modest growth driven by new products, including BETAMATE™ Structural
Adhesives, and continued recovery in the transportation sector in North America and China while expected growth in Europe
may be hindered by Eurozone economic concerns. Dow Electronic Materials expects sales growth driven by increased demand
for portable electronics and mobile devices as a result of low global oil prices, which is expected to outweigh weakening
demand for films and filters.
INFRASTRUCTURE SOLUTIONS
The Infrastructure Solutions segment consists of the following businesses: Dow Building & Construction, Dow Coating
Materials, Energy & Water Solutions, and Performance Monomers; and includes a portion of the Company's share of the results
of Dow Corning, a joint venture of the Company.
Infrastructure Solutions
In millions 2014 2013 2012
Sales $ 8,429 $ 8,339 $ 8,071
Price change from comparative period —% (1)% (5)%
Volume change from comparative period 1% 4 % 1 %
Equity earnings (losses) $ (6) $ 126 $ 58
EBITDA $ 817 $ 941 $ 963
Certain items impacting EBITDA $ (348) $ (94) $ (142)
2014 Versus 2013
Infrastructure Solutions sales were $8,429 million in 2014, up from $8,339 million in 2013. Sales increased 1 percent, entirely
due to volume. Volume was higher in all geographic areas, except EMEAI which was impacted by weakened demand. Dow
Building & Construction volume increased due to higher demand for insulation products in North America. Dow Coating
Materials volume increased in all geographic areas due to higher demand for architectural and industrial coatings. Energy &
Water Solutions volume increased across most geographic areas due to strong demand fundamentals in the oil and gas industry
as well as higher demand for specialty materials used in energy and industrial water applications. Performance Monomers
volume decreased due to long acrylate market conditions, extended planned and unplanned maintenance turnarounds in vinyl
acetate monomers, and a plastic additives plant closure which reduced market participation. Price was flat as selling price gains
were offset by the unfavorable impact of currency. Price was mixed by geographic area as gains in Latin America and North
America were offset by declines in EMEAI and Asia Pacific. Price was down in all businesses, except Performance Monomers.
EBITDA for 2014 was $817 million, compared with $941 million in 2013. EBITDA in 2014 included a $500 million loss
related to Dow Corning’s abandonment of a polycrystalline silicon plant expansion in Clarksville, Tennessee, and a
$252 million gain related to Dow Corning’s adjustment of its implant liability, with both items impacting equity earnings.
EBITDA in 2014 was also impacted by a $100 million charge for a warranty accrual adjustment related to an exited business.
EBITDA in 2013 included $95 million of asset impairments and related costs in the Energy & Water Solutions and
Performance Monomers businesses and a $1 million gain in Dow Building & Construction for an adjustment to asbestos
abatement costs related to the 1Q12 Restructuring program. See Notes 3, 8, 11 and 14 to the Consolidated Financial Statements
for additional information on these certain items. Excluding these certain items, EBITDA increased in 2014 as higher equity
earnings from Dow Corning and higher sales volume more than offset increased propylene costs and higher freight expenses.
2013 Versus 2012
Infrastructure Solutions sales were $8,339 million in 2013, up from $8,071 million in 2012. Sales increased 3 percent, with
volume up 4 percent and price down 1 percent. Volume was higher in all businesses and all geographic areas. Energy & Water
Solutions volume increased due to higher demand for specialty materials used in energy and industrial water applications as
well as strong demand fundamentals in the oil and gas industry. Dow Coating Materials volume increased due to higher
demand for architectural and industrial coatings, primarily in North America driven by improved end-use market conditions.
Performance Monomers volume increased in all geographic areas, primarily driven by higher demand for acrylic acid used in
coating and adhesives applications. Dow Building & Construction volume increased due to higher demand for insulation