DuPont 2013 Annual Report Download - page 29

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Part II
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS, continued
28
Liquidity & Capital Resources
December 31,
(Dollars in millions) 2013 2012
Cash, cash equivalents and marketable securities $ 9,086 $ 4,407
Total debt 12,462 11,740
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. 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, share repurchases, 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. The company has
access to approximately $4.4 billion in unused credit 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's cash, cash equivalents and marketable securities at December 31, 2013 and 2012 are $9,086 million and $4,407
million, respectively. Cash and cash equivalents at December 31, 2013 include the proceeds received from the sale of the
Performance Coatings business. Cash, cash equivalents and marketable securities held outside of the U.S. of $3,889 million and
$4,118 million at December 31, 2013 and 2012, respectively, are generally utilized to fund local operating activities and capital
expenditure requirements and are expected to support non-U.S. liquidity needs for the next twelve months and the foreseeable
future thereafter. The company expects domestic liquidity needs, for at least the next twelve months and the foreseeable future
thereafter, will be met through existing cash, cash equivalents and marketable securities held in the U.S. and other funding sources,
including cash generated from U.S. operations, asset sales, the ability to access the capital markets, and the company's credit lines.
Therefore, the company believes that it has sufficient sources of domestic liquidity to support its assumption that undistributed
earnings at December 31, 2013 can be considered reinvested indefinitely.
The company continually reviews its debt portfolio and occasionally may rebalance it to ensure adequate liquidity and an optimum
debt maturity schedule. In 2013, the company issued $1,250 million of 2.80% Notes due February 15, 2023 and $750 million of
4.15% Notes due February 15, 2043.
The company's credit ratings impact its access to the debt capital markets 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:
Long-term Short-term Outlook
Standard & Poor's A A-1 Stable
Moody’s Investors Service A2 P-1 Stable
Fitch Ratings A F1 Stable
(Dollars in millions) 2013 2012 2011
Cash provided by operating activities $ 3,179 $ 4,849 $ 5,152
Cash provided by operating activities decreased $1.7 billion in 2013 compared to 2012 due to lower cash from earnings and higher
working capital in the Agriculture segment. Lower earnings were driven by the absence of 11 months of results from the Performance
Coatings business as well as a decline in the Performance Chemicals segment. Higher working capital in the Agriculture segment
was a result of higher trade receivables due to an increase in sales in the fourth quarter 2013 as well as an increase in customer
credit sales in Latin America. In addition the Agriculture segment's working capital was negatively impacted in 2013 as a result
of timing differences in when customer prepayments for the 2012 and 2013 growing seasons were collected.