DuPont 2007 Annual Report Download - page 70

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2. OTHER INCOME, NET
2007 2006 2005
Cozaar»/Hyzaar»licensing income $ 951 $ 815 $ 747
Royalty income 125 120 130
Interest income 154 129 227
Equity in (losses) earnings of affiliates (Note 12) (130) 50 108
Net gains on sales of assets 126 78 82
Net exchange (losses) gains
1
(65) 16 423
Miscellaneous income and expenses – net
2
114 353 135
$1,275 $1,561 $1,852
1
The company routinely uses forward exchange contracts to offset its net exposures, by currency, related to the foreign currency- denominated
monetary assets and liabilities of its operations. The objective of this program is to maintain an approximately balanced position in foreign
currencies in order to minimize, on an after-tax basis, the effects of exchange rate changes. The net pretax exchange gains and losses are
largely offset by the associated tax impact.
2
Miscellaneous income and expenses – net, principally includes insurance recoveries, litigation settlements, interest items, and other
miscellaneous items.
3. INTEREST EXPENSE
2007 2006 2005
Interest incurred $475 $497 $541
Interest capitalized (45) (37) (23)
$430 $460 $518
4. RESTRUCTURING ACTIVITIES
2007 Activities
During 2007, the company did not institute any significant restructuring programs. In 2007, employee separation
payments, net of exchange impact, of $77 associated with 2006 restructuring activities were made. At December 31,
2007, total liabilities relating to prior year restructuring activities were $82 including $70 associated with the plans
initiated in 2006.
2006 Activities
During 2006, the company initiated restructuring actions within its Agriculture & Nutrition and Coatings & Color
Technologies segments to improve the company’s global competitiveness. As a result, a net charge of $326 was
recorded in Cost of goods sold and other operating charges for employee separation and asset write-downs. Further
details are discussed below.
Agriculture & Nutrition
During the fourth quarter 2006, the Agriculture & Nutrition platform launched plans to re-deploy capital and
resources within various segments of the business. The plans included the closing or streamlining of
manufacturing units at about twelve sites and the reduction of approximately 1,500 positions globally.
Restructuring charges resulting from the plans totaled $194, $72 of which are reflected within Performance
Materials segment results following the realignment of certain businesses in 2007. The global program included
$64 for severance payments and $130 principally for asset impairments, primarily related to definite-lived intangible
assets whose remaining useful lives were reduced, abandoned technology and other non-personnel charges. At
December 31, 2007, 1,054 employees were separated from the company and 118 were redeployed. Essentially all
employees are expected to be separated from the company by 2009. Cash payments related to these separations
were approximately $25 in 2007 and $4 in 2006.
F-13
E. I. du Pont de Nemours and Company
Notes to the Consolidated Financial Statements (continued)
(Dollars in millions, except per share)