Lukach clsa - final final
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Transcript of Lukach clsa - final final
DELIVERING SOLUTIONS. DELIVERING GROWTH.
Delivering Growth inDelivering Growth in Asia through InnovationCarl L kachCarl LukachPresident – DuPont East Asia
November 7, 2011
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
Th h d h i l d i f i h d f ll d iRegulation G
The attached charts include company information that does not conform to generally accepted accounting principles (GAAP). Management believes that an analysis of this data is meaningful to investors because it provides insight with respect to ongoing operating results of the company and allows investors to better evaluate the financial results of the company. These measures should not be viewed as an alternative to GAAP measures of performance. Furthermore, these measures may not be consistent with similar measures provided by other companiescompanies.
This data should be read in conjunction with previously published company reports on forms 10-K, 10-Q, and 8-K. These reports, along with reconciliations on non-GAAP measures to GAAP results are available on the Investor Center of www.dupont.com.
Forward Looking StatementsDuring the course of this presentation we may make forward-looking statements or provide forward-looking information. All statements that address expectations or projections about the future are forward-looking statements. Some of these statements include words such as “plans,” “expects,” “will,” "believes," “intends,” and “estimates ” Although they reflect our current expectations these statements are not guarantees of futureestimates. Although they reflect our current expectations, these statements are not guarantees of future performance, but involve a number of risks, uncertainties, and assumptions. Some of those risk factors include: fluctuations in energy and raw material prices; failure to develop and market new products and optimally manage product life cycles; global economic and capital markets conditions; litigation and environmental matters; changes in laws and regulations or political conditions; and business or supply disruptions. The Company does not undertake to update any forward-looking statements as a result of future developments or new information.undertake to update any forward looking statements as a result of future developments or new information.
Developing MarketsTotal developing markets is comprised of Developing Asia, Developing Europe, Middle East & Africa, and Latin America. A detailed list of all developing countries is available on the Earnings News Release link on the Investor
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
Center website at www.dupont.com.
2
DUPONT FULL YEAR FINANCIAL HIGHLIGHTS
Full Year Sales2010: $31.5B, +21% $38-$39$ ,2011E: $38-39B, +22%
$ in
Billi
ons
Full Year EPS*2010: $3.28, +62%2011E: $3 97 $4 05 +22% e
$3.97 - $4.05
2011E: $3.97-$4.05, +22%
$ pe
r sha
reDividendAnnounced our 429th consecutive quarterly dividendMaintained our dividend during the recession
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. * Excludes significant items. Refer to company website for detailed reconciliations of non-GAAP measures.
3
OUR INDUSTRY LEADERSHIP IN SCIENCEExternal recognitionExternal recognition
#1 in our industry for patent strength (The Patent Board)Five consecutive years for this award
Top 50 Innovative Companies (MIT Review)
Five consecutive years for this award
Awarded in 2010 to firms that show the most innovation in commercializing new technologies
World’s Most Admired Companies Top 50 (Fortune)The only company in our sector to be named to this list
Zytel® PLUS “Most Innovative Use of Plastics Award” (SPE)A collaboration with General Motors for use of Zytel® PLUS in an engine cover application
Best Place to Work in Large Industry (The Scientist)DuPont earned the top spot, Pioneer was number two
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 4
WE ARE APPLYING OUR SCIENCET fi d l ti t ll bi h llTo find solutions to some really big challenges:
FOOD ENERGY PROTECTION
FEEDING THE REDUCING OUR KEEPING PEOPLE &FEEDING THE WORLD
REDUCING OUR DEPENDENCE ON
FOSSIL FUELS
KEEPING PEOPLE & THE ENVIRONMENT
SAFE
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 5
TWO BILLION MORE PEOPLE BY 2050G th i i d l i i i l di A iGrowth occurring in developing regions including Asia
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. Source: United Nations population division (2011)
Implications: need 70% more food production, additional energy to meet the growth
6
ONE BILLION MORE MIDDLE CLASS BY 2020Middl l th t t d i A iMiddle class growth concentrated in Asia
millionmillion
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. Source: Organization for Economic Cooperation and Development paper 285 (2010)
Implications: rising incomes, more consumption of protein, and an enhanced lifestyle
7
DUPONT GROWTH STRATEGYDriving innovation productivity and growth in developing marketsDriving innovation, productivity, and growth in developing markets
2010 Global pro forma sales $34.2B2010 Global pro forma sales $34.2BDeveloping regions: $11.1B or 32% Developing regions: $11.1B or 32%
Asia ‐Developing
14%
Growing:Asia contributed to 23% of 2010 pro forma revenue and growing
US36%
Asia ‐Developed
9%
Broadening market access:The Danisco acquisition has broadened our reach in enzymes
EMEA‐Developing
7%
and food
Megatrends:Food energy and protection are
Canada3%
Latin America11%
EMEA ‐Developed
20%
Food, energy, and protection are increasing in importance for developing markets
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
11%
8
DUPONT GROWTH STRATEGYBuilding three world leading integrated competenciesBuilding three world-leading, integrated competencies
As a premier market-driven science company,As a premier market driven science company, we will generate superior shareholder returns by integrating
across the ag-biotech-material space:
Ag & Nutrition Advanced Materials
SeedsTraits
Ag Chemicals
Materials
Electronic MaterialsProtective MaterialsAlternative Energy
Specialty FoodIngredients
Alternative EnergyAdvanced PolymersAdvanced Processes
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 9
INVESTING FOR GROWTHDuPont 2010 pro forma R&DTo be a premier market-driven science company and generate superior shareholder returns by differentially managing our portfolio:
DuPont 2010 pro forma R&D
Decreasing Dependence on Fossil Fuels
15%
11%
Protecting People and the Environment
MegatrendsChemistry
Engineering 11%
9%60%Chemicals and
M i l
Increasing Food Production
Engineering
Materials Science
Nanotechnology
Industrial Biotech
Ag Biotech
5%
Materials
Electronics
Ag Biotech
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 10
DUPONT ASIA PACIFIC GROWTH20% revenue growth for 2011E~20% revenue growth for 2011E
~20%$
• Growth led by electronics, automotive, packaging, and agriculture
5 5
7.3
Revenue, $ BillionsExcluding joint ventures
• Geographic expansion and market penetration playing a
5.5 5.2
key role
2008 2009 2010 2011E
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
Demonstrated growth through market-driven science11
GROWTH DRIVERS FOR DUPONT IN ASIA PACIFIC
FOUR ELEMENTS:FOUR ELEMENTS:TECHNOLOGY DRIVEN GROWTH
P f P l f t• Performance Polymers for auto• Emerging bio-based polymers• Advanced photovoltaic materials• New crop protection & seed products
In economies with GDP
growth rates
MARKET PENETRATION GROWTH• China “Go West” program• India g
2-3X developed markets
• ASEAN• New products for local markets
GROW WITH GLOBAL INDUSTRY LEADERSGROW WITH GLOBAL INDUSTRY LEADERS• Automotive• Electronics
GROWTH IN NEW MARKETS
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 12
GROWTH IN NEW MARKETS• Food• Energy
DUPONT IN GREATER CHINAabout 22% sales growth from 2010 to 2011Eabout 22% sales growth from 2010 to 2011E
24% CAGR
Revenue, $ BillionsExcluding joint ventures
24% CAGR 2008-2011E
Plants
R&D/Technical Centers
Offices
Joint Ventures
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
DuPont’s innovation strategy in China targets large new markets
13
CHINA’S 12th 5-YEAR PLANHighlights Major Opportunities Relevant to DuPontHighlights Major Opportunities Relevant to DuPont
Global Megatrends China Opportunities Implication
• Higher yields • Pioneer • P&IP
• Increasing food production
Increasing food production & safety
Decreasing dependence on
• Advanced techonology in agriculture
• Food quality • Food safety
• New energy • Energy efficiency
• Pioneer • Solae• DCP• Animal Health
• DPVS• Bio - fuel & Bio - material
DPP
• P&IP• Qualicon• Food industry
board
• Decreasing dependence on fossil fuels
Decreasing dependence on fossil fuels
gy y• New materials• Bio-material
• DPP • DC&F• Industry board – Wind, Railway
Protecting lives & environment
• Water treatment & conservation• Emission reduction• New materials
• DSS• DC&F• DPT
• P&IP• E&C
• Protecting livesGrowing in emerging
markets, urbanization & infrastructure development
• Construction• Infrastructure• Electricity grid• Mass transportation
• BI• DPP• DTT• DPC• DPT
• industry board –Auto, Food
• P&IP
• Clean Technology • BI
• Growing in developing
k t
Increasing people’s disposable income
• Automotive• Construction• Consumer goods & food• Electronics & communications
DPT
• DPC• BI• DTT• Solae• E&C
DC&F
• industry board –Auto, Food, 3C
• P&IP
DPC
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
marketsIndustry restructuring & indigenous innovation
• Agriculture modernization• Upgrading traditional industries• Develop new strategic industries• Services sector developmt
• DC&F• DCP• Pioneer• Solae• DPP
• DPC• DPT• DTT• E&C• P&IP
14
DELIVERING SOLUTIONS IN CHINAChina Technical Center enables market driven innovationChina Technical Center enables market-driven innovation
$400
REVENUE FROM NEW PRODUCTS
$Millions
$200
$300
$400
2008
$-
$100
2007 2010
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
New products drive differentiation in the marketplace
15
DUPONT IN INDIA
Revenue, $ BillionsExcluding joint ventures
22% CAGR2008-2011E
PLANTS
KNOWLEDGE CENTER
Medhcal Plant
Chennai Office Madurai Plant
DISTRIBUTION CENTERS
OFFICES
TECHNICAL CENTERS
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 16
DUPONT IN INDIA
•New seeds•Large mid-tier segment
AGRICULTURE
•Solae offering in India staple food•Penetration with Danisco offerings
FOOD
• India hub for small cars & components• Increased penetration
AUTO
•Off grid applicationsPV
•Fresh fruits & vegetablesPACKAGING
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
DuPont’s Innovation Strategy in India targets the domestic market17
INDIA TRENDS AND DUPONT OPPORTUNITIES
GROWTH TREND IMPLICATIONS
• High yield hybridsAGRICULTURE • Higher productivity
• Advanced technologies
• High yield hybrids• Crop protection products• Agri supply chains
INFRASTRUCTURE• Public & private investment• Roads, railways and defense
expenditure• Construction growth
• Pigments for coatings• Asphalt modifiers• Eng polymers, Adv mat’ls• Building Materials
ENERGY & AUTOMOTIVE
• Small car hub• Energy demand• Renewable energy
• Eng Polymers, Refinishes, Refrigerants
• Photovoltaics• Nomex® advanced mat’ls
DEMOGRAPHICS• Higher disposable income• Consumerism and retail• Better quality safer food
• Mat’ls for electronics & durables
• Advanced pkg sol’ns
• Nomex®, advanced mat ls
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
Better quality, safer food• Nutrition products
Confluence of large market, strong local R&D and global leverage18
DUPONT IN ASEANPlants
Offices
1 0
Revenue, $ BillionsExcluding joint ventures
13% CAGR2008-2011E
0 5
1.0 2008-2011E
0.0
0.5
0.02008 2009 2010 2011E
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 19
UNIQUE ASEAN MARKETSAdditional $1B sales potential in 2020Additional $1B sales potential in 2020
Increase yield, productivity, food security & health.AQUACULTUREAG & FOOD
85% of world palm oil in Malaysia & Indonesia. Increase plantation productivity and crop value.PALM OIL
Energy demand rising >2X global. Large off-grid PV need. PV module manufacturing migrating to ASEAN.PV
Large NOCs. Pipeline products and Enhanced Oil Recovery.OIL & GAS
“ASEAN- biomass” based materials, chemicals and fuels.BIOMATERIALS
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
DuPont’s Innovation Strategy in ASEAN targets unique ASEAN markets
20
DUPONT IN JAPANDKK : DuPont Kabushiki KaishaMDP : DuPont-Mitsui Polychemicals Co.,LtdMDF : DuPont-Mitsui Fluorochemicals Co.,Ltd.TDFJ :Teijin DuPont Films Japan LimitedTDC : DuPont-Toray Co.,Ltd.8.4% CAGR
Revenue, $ Billions
2008-2011E
Remarks:- JV sales is on 100% basis.- Danisco sales are excluded.
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
16 joint ventures with leading Japanese companies significantly contribute to DuPont Japan sales
21
JAPAN: FUTURE MARKET TRENDS & GROWTH AREAS
Growth Area for DuPont in Japan
Automotive & Hi-Speed
•HV/EV (Next Gen. Auto)•Film-Insert-Mold
Future Market Trend
Japan Market TrendsGlobal Megatrendsp
Train
Electronics
•Hi-speed Train
•LED / OLED Lighting•Commercial Printing•Medical Electronics
• Improve productivity & quality Effective field utilization
(small field, urban area etc.) Maintain good food quality for
long-term
Increasing Foodproduction
Energy
•Printable Electronics
•Photovoltaic (PV)•Energy Storage•Smart Grid
long term
• Promote low carbon society Energy saving Alternative energy
R bl d d
Decreasing Dependenceof Fossil Fuels
Bio-Related
•Smart Grid
•Renewable sourced materials
• Industrial-Bio
Renewable sourced energy and materials
• Aging society – More needs for better life (safety, health,
t i bl li i )
Protecting Lives & the Environment
Food
Medical/
•Specialty Food- Solae + Danisco
•Clean & DisinfectSt ili ti
sustainable living)
• “Emerging Hi-tech”(New technology will emerge from Japan and roll out to
Growing in EmergingMarkets
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
Medical/Healthcare •Sterilization
•Power aids
pemerging markets)
Markets
22
JAPAN’S GLOBAL MARKET SHARE IN KEY INDUSTRIES
10,000 Information and1. Japan is leading innovator and has No.1 market share in new & emerging Automotive
Japan’s Global Market Share in Key Industries
1,000
Telecommunications
Computer and information terminals
telecommunications equipment
Automobiles
AV equipment
2. Japanese system manufacturers and material suppliers are “the incubator”for Emerging Automotive & Electronic t h l i f l b l k t
market share in new & emerging Automotive and *Electronic systems *Broadest Offering
100
obal
Mar
ket S
ize
PV modules
Digital still cameras
Telecommunicationsequipment Semiconductors
Other electronic devices
Semiconductormfg equipment
Displays
LCDs
Multilayer printed
Electronic parts
LCD materials
Monocrystalsilicon wafers
Semiconductor materialsSemiconductor
encapsulation materials
technologies for global market
Wire harness
Small motor for auto
OA
1
10Glo Multilayer printedwiring boards
Magnetic heads of HDDs
silicon wafers
LCD polarizing platesPDP panel parts materials
LiB
White LEDs
LCD fluorescent lamps
Car navigation Spindle motors for HDDs
LCD phasedifference films
End Products (AUTO) Components/Devices (Emerging Hi-Tech)
Government Support Area
OA
Car air conditionerLaminated ceramic capacitor
0.10% 25% 50% 75% 100%
Global Market Share by Japanese Companies
Hybrid carMotor / Inverter / Battery
for cell phones Semiconductor laser for optical disk drives
d oducts ( U O)
End Products (ELEC)
Co po e ts/ e ces ( e g g ec )
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
DuPont’s innovation strategy in Japan targets next-gen collaborative science for automotive & electronic applications
23Source: Ministry of Economy, Trade, and Industry (METI), Gov’t of Japan
INNOVATION MADE REALDuPont Japan Innovation Center in NagoyaDuPont Japan Innovation Center in Nagoya
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 24
DuPont’s collaboratory is providing solutions for Japan’s leading advanced materials companies
JAPAN INNOVATION CENTERRecent SuccessesRecent Successes
PA 610 for Radiator End TankPA 610 for Radiator End Tank• Bio-source materials (from castor oil)• Calcium chloride resistance is key performance
Bi PTT S ® fib (f b i ) f T t SAIBio PTT Sorona® fiber (fabric) for Toyota SAI• Head liner, sun visor, trim, contributed to 60% surface by Bio Material
HTN Insulator parts for HEVHTN Insulator parts for HEV•Adopted in 3rd Prius (2008), further extension/adoption is planned for 4th Prius (2014), new HV (2012) etc.•Application : Insulator parts such as power-cable connector, terminal connector, bus bar, bobbin , ,
Bio PTT Sorona® resin for Toyota Prius-alpha• Adopted for instrument-panel air-conditioning system outlet
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 25
THE BUSINESS OF INNOVATIONNew DuPont Innovation Centers in Seoul Taipei Bangkok & PuneNew DuPont Innovation Centers in Seoul, Taipei, Bangkok & Pune
Seoul Taipei
Bangkok Pune
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved.
DuPont Innovation Centers to fuel local collaboration in key markets26
KEY MESSAGES
The megatrends of food, energy, and protection resonate globallyresonate globally
In Asia, we see near-term opportunities and long-term growth tied to the growing population and expanding middle class
Our innovation reach is expanding, with new innovation centers launched in Bangkok, Pune, Seoul and Taipei.centers launched in Bangkok, Pune, Seoul and Taipei.
Our strategy is working with +20% 2011E growth in Asia
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 27
© 2011 E.I. du Pont de Nemours and Company. All Rights Reserved. 28