DuPont 2010 Annual Report Download - page 30

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Part II
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS, continued
The segment is on track to complete a $295 million expansion to support the DuPont Tedlarpolyvinyl fluoride films
business. This includes a $120 million investment in capacity expansion to produce the raw materials that make the
film, which was completed in 2010. A multi-phase $175 million investment of high-performance TedlarPV2001 series
oriented film production is scheduled for completion in 2011. Tedlarfilms serve as the critical component of
photovoltaic module backsheets, providing long-term durability and performance in all weather conditions.
2010 versus 2009 Sales of $2.8 billion were up 44 percent, reflecting 37 percent higher volume and 7 percent higher
USD selling prices. Higher volume was driven by strong growth in all regions, particularly in Asia Pacific and Europe,
and strong demand across most market segments, particularly in photovoltaics. Higher USD selling prices were
primarily due to pass-through of higher precious metals prices.
PTOI was $445 million compared to $87 million in the prior year. The increase in PTOI was driven by substantially higher
volume, improved productivity and the absence of a net $37 million restructuring charge in the prior year.
2009 versus 2008 Sales of $1.9 billion were down 13 percent, reflecting 11 percent volume decline and 2 percent
lower USD selling prices. The lower volume reflects the impact of the global economic recession which affected sales
for products across all key markets. Sales volume improved throughout 2009, most significantly in Asia Pacific, where
sales were essentially flat when compared to 2008. The lower USD selling prices were mainly due to contractual
pass-through of lower precious metal prices.
PTOI was $87 million compared to $251 million in 2008. The decline in PTOI was primarily due to the impact of lower
sales, lower income from affiliates, and higher charges associated with low capacity utilization of production lines.
Outlook For 2011, sales of products into photovoltaics, consumer electronics, displays, and advanced printing
markets are expected to increase moderately. The segment continues to make productivity and supply chain
improvements, as well as capacity investments to meet global demand. Segment earnings are expected to increase
reflecting the impact of higher volume and productivity initiatives, as well as investments for growth.
Segment Sales PTOI
(Dollars in billions) (Dollars in millions)
2010 $6.3 $1,081
2009 $5.0 $ 547
2008 $6.0 $ 687
Performance Chemicals businesses deliver customized solutions with a wide range of industrial and specialty chemical
products for markets including plastics & coatings, textiles, mining, pulp and paper, water treatment and healthcare.
The following are Performance Chemicals’ operating businesses:
DuPont Titanium Technologies is the world’s largest manufacturer of titanium dioxide, and is dedicated to creating
greater, more rewarding value for the coatings, paper, plastics, specialties and minerals markets through service,
brand, and product. The business’ main products include its broad line of DuPontTi-Puretitanium dioxide products.
DuPont Chemicals and Fluoroproducts is a leading global manufacturer of industrial and specialty fluorochemicals,
fluoropolymers, and performance chemicals. The business’ broad line of products that include refrigerants, lubricants,
propellants, solvents, fire extinguishants and electronic gases, cover a wide range of industries and markets. Key
brands include DuPontTM Teflon, Dymel, Isceon, Suva, Vertrel, Zyron, Vazoand Virkon.
2010 versus 2009 Sales of $6.3 billion were 27 percent higher than last year, reflecting 18 percent higher volume and
10 percent higher USD selling prices, which were partially offset by portfolio changes of 1 percent. Broad-based market
recovery led to sales increases in all markets and all regions, most significant in Asia Pacific, reflecting strong demand
for titanium dioxide, fluoropolymers and refrigerants, with continuing adoption of ISCEONas a preferred retrofit to R22
29
PERFORMANCE CHEMICALS