DuPont 2009 Annual Report Download - page 27

Download and view the complete annual report

Please find page 27 of the 2009 DuPont annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 113

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113

Part II
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS, continued
techniques of future cash flows. Given the current economic environment and the uncertainties regarding the potential
impact on the company’s businesses, there can be no assurance that the company’s estimates and assumptions
regarding forecasted cash flow and revenue and operating income growth rates made for purposes of the annual
goodwill impairment test, will prove to be accurate predictions of the future. The company believes the current
assumptions and estimates utilized are both reasonable and appropriate. Information with respect to the company’s
significant accounting policies on long-lived assets is included in Note 1 to the Consolidated Financial Statements.
Segment Reviews
Segment sales include transfers to another business segment. Products are transferred between segments on a basis
intended to reflect, as nearly as practicable, the market value of the products. Segment pre-tax operating income/(loss)
(PTOI) is defined as operating income before income taxes, exchange gains/(losses), corporate expenses, interest and
the cumulative effect of changes in accounting principles. A reconciliation of segment sales to consolidated net sales
and segment PTOI to income before income taxes for 2009, 2008 and 2007 is included in Note 26 to the Consolidated
Financial Statements.
As described in Note 5 to the Consolidated Financial Statements, the company initiated global restructuring programs
during 2009 and 2008. The 2009 and 2008 program charges reduced total segment PTOI for 2009 and 2008 by
$340 million and $535 million, respectively.
In addition, in 2009, the company recorded a $100 million and $30 million net reduction in the estimated costs
associated with the 2008 program and 2009 programs, respectively.
Below is a summary of the net impact to each segment related to the activities described above:
2009 (Charges) and Credits 2008 (Charge)
2009 Net 2008 Net
2009 Program Program 2009 2008
(Dollars in millions) Program Reductions Reductions Net Impact Program
Agriculture & Nutrition $ - $ - $ 1 $1 $ (18)
Electronics &
Communications (43) 6 - (37) (37)
Performance Chemicals (66) 9 3 (54) (50)
Performance Coatings (65) (11) 61 (15) (209)
Performance Materials (110) 23 29 (58) (94)
Safety & Protection (55) 8 2 (45) (96)
Other (1) (5) 4 (2) (31)
Total (Charge) Credit $(340) $ 30 $100 $(210) $(535)
Segment Sales PTOI
(Dollars in billions) (Dollars in millions)
2009 $8.3 $1,224
2008 $8.0 $1,087
2007 $6.8 $ 894
Agriculture & Nutrition’s businesses leverage the company’s technology, customer relationships, and industry
knowledge to improve the quantity, quality and safety of the global food supply and the global production agriculture
industry. Land available for worldwide agricultural production is increasingly limited so production growth will need to
be achieved principally through improving crop yields and productivity rather than through increases in planted area.
The segment’s businesses deliver a broad portfolio of products and services that are specifically targeted to achieve
26
AGRICULTURE & NUTRITION