DuPont 2012 Annual Report Download - page 29

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
(Dollars in millions)  
 $4,407 $ 4,019
 11,740 12,553
The company believes its ability to generate cash from operations and access to capital markets will be adequate to meet anticipated cash requirements to fund
working capital, capital spending, dividend payments, debt maturities and other cash needs. The company's liquidity needs can be met through a variety of
sources, including: cash provided by operating activities, cash and cash equivalents, marketable securities, commercial paper, syndicated credit lines,
bilateral credit lines, equity and long-term debt markets and asset sales. The company's current strong financial position, liquidity and credit ratings provide
excellent access to the capital markets. In addition, spending and capital productivity actions have been implemented. The company will continue to monitor
the financial markets in order to respond to changing conditions. Depending on these conditions, the proceeds of commercial paper may be invested in cash
equivalents or marketable securities.
Pursuant to its cash discipline policy, the company seeks first to maintain a strong balance sheet and second, to return excess cash to shareholders unless the
opportunity to invest for growth is compelling. Cash, cash equivalents and marketable securities provide primary liquidity to support all short-term debt
obligations. A substantial majority of the company's cash, cash equivalents and marketable securities is held by foreign subsidiaries and is considered to be
indefinitely reinvested and expected to be utilized to fund local operating activities and capital expenditure requirements. The company believes that it has
sufficient sources of domestic liquidity to further support its assumption that undistributed earnings at December 31, 2012 can be considered reinvested
indefinitely. The company has access to approximately $4.3 billion in unused cr edit lines with several major financial institutions, as additional support to
meet short-term liquidity needs and general corporate purposes, including letters of credit.
The company continually reviews its debt portfolio and occasionally may rebalance it to ensure adequate liquidity and an optimum debt maturity schedule. In
2011, the company issued $2.0 billion in Senior Notes and $1.0 billion in commercial paper to finance the acquisition of Danisco. Additionally, the company
assumed $0.7 billion in debt as part of the acquisition, which was refinanced through the issuance of commercial paper.
The company's credit ratings impact its access to the debt capital market and cost of capital. The company remains committed to a strong financial position
and strong investment-grade rating. The company's long-term and short-term credit ratings are as follows:
  
Standard & Poor's AA-1 Stable
Moody’s Investors Service A2 P-1 Stable
Fitch Ratings AF1 Stable
(Dollars in millions)   
 $ 4,849 $ 5,152 $4,559
Cash provided by operating activities decreased $303 million in 2012 compared to 2011 due mainly to lower earnings and a $500 million contribution to its
principal U.S. pension plan, partially offset by less of an increase in operating assets and liabilities.
Cash provided by operating activities increased $593 million in 2011 compared to 2010. The increase was driven by higher earnings, lower contributions to
pension plans and the weaker dollar, which was hedged with forward exchange contracts reflected in investing activities. These increases were partially offset
by changes in operating assets and liabilities, mainly due to higher inventory.
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