Dow Chemical 2015 Annual Report Download - page 55

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EBITDA for 2015 was $1,048 million, down from $1,130 million in 2014. EBITDA in 2015 was impacted by $67 million of
restructuring charges and an $8 million gain related to Dow Corning’s adjustment of its implant liability. EBITDA in 2014 was
impacted by a $155 million gain related to Dow Corning's adjustment of its implant liability and a $73 million charge related to
asset impairments in Dow Electronic Materials. See Notes 3, 9, 10, and 12 to the Consolidated Financial Statements for
additional information on these items. Excluding these certain items, EBITDA increased in 2015 as lower feedstock, energy
and other raw material costs, the favorable impact of currency on costs, lower operating expenses and higher sales volume
more than offset lower selling prices and decreased equity earnings from Dow Corning.
2014 Versus 2013
Consumer Solutions sales were $4,639 million in 2014, up from $4,562 million in 2013. Sales increased 2 percent from 2013,
with volume up 3 percent and price down 1 percent (with more than one-third of the price decline due to currency). Volume
increased in all businesses and all geographic areas, except Latin America. Volume gains in Dow Automotive Systems were
driven by continued recovery in the North America transportation sector and modest recovery in Europe. Dow Electronic
Materials volume increased primarily due to higher demand for photolithography materials and chemical mechanical
planarization pads, which more than offset lower demand for films and filters and organic light-emitting diode ("OLED")
materials. Volume increased in Consumer Care due to strong demand for cellulosics used in food and pharmaceutical
applications. Price declines were driven by Dow Electronic Materials, primarily in Asia Pacific due to continued competitive
pricing pressure and the weakening Japanese yen. Price remained flat in Consumer Care and Dow Automotive Systems. Price
gains in North America were more than offset by declines in EMEAI and Asia Pacific.
EBITDA for 2014 was $1,130 million, up from $933 million in 2013. Compared with 2013, EBITDA increased as higher sales
volume, increased equity earnings from Dow Corning and lower R&D expenses more than offset lower selling prices. EBITDA
in 2014 was positively impacted by $82 million of certain items, as previously discussed.
Consumer Solutions Outlook for 2016
Consumer Solutions sales are expected to grow in 2016, driven by volume growth. Consumer Care expects modest volume
gains from increased demand for home care and personal care products while sales of cellulosics used in food and pharma
applications are expected to remain stable. Sales growth is expected in Dow Automotive Systems, as continued low oil prices
are expected to drive increased demand, primarily for larger vehicles. Dow Electronic Materials expects modest volume growth
in all businesses with steady growth in smart phones, wearable and home devices as well as automotive electronics more than
offsetting expected declines in television monitors, personal computers and tablets. The change in consumer preference towards
hybrid/clamshell devices is also expected to deliver demand growth in 2016.
On December 10, 2015, the Company entered into a definitive agreement to restructure the ownership of Dow Corning. Under
the terms of the agreement, Dow will become the 100 percent owner of Dow Corning, currently a 50:50 joint venture between
Dow and Corning. Dow and Corning will maintain their current equity stake in the Hemlock Semiconductor Group. The
transaction is expected to close in the first half of 2016.
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 2015 2014 2013
Sales $ 7,394 $ 8,429 $ 8,339
Price change from comparative period (14)% —% (1)%
Volume change from comparative period 2 % 1% 4 %
Equity earnings (losses) $ 203 $ (6) $ 126
EBITDA $ 1,021 $ 817 $ 941
Certain items impacting EBITDA $ (101) $ (348) $ (94)
EBITDA excluding certain items $ 1,122 $ 1,165 $ 1,035
2015 Versus 2014
Infrastructure Solutions sales were $7,394 million in 2015, down 12 percent from $8,429 million in 2014. Price decreased
14 percent, including the unfavorable impact of currency which represented one-third of the price decline, and volume
increased 2 percent. Price declined in all businesses, most notably in Performance Monomers, and all geographic areas in