SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) October 25, 2000
E. I. du Pont de Nemours and Company
(Exact Name of Registrant as Specified in Its Charter)
Delaware 1-815 51-0014090
(State or Other Jurisdiction (Commission (I.R.S Employer
of Incorporation) File Number) Identification No.)
1007 Market Street
Wilmington, Delaware 19898
(Address of principal executive offices)
Registrant's telephone number, including area code: (302) 774-1000
1
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Item 5. Other Events
------------
The Registrant files, pursuant to Regulation FD, its earnings press
release dated October 25, 2000, entitled "DuPont Reports Third Quarter 2000
Earnings," a copy of which is below. This earnings press release is also
filed in connection with Debt and/or Equity Securities that may be offered on
a delayed or continuous basis under Registration Statements on Form S-3 (No.
33-53327, No. 33-61339, No. 33-60069 and No. 333-86363).
October 25, 2000 Contact: Clif Webb
WILMINGTON, Del. 302-774-4005
[email protected]
DUPONT REPORTS THIRD QUARTER 2000 EARNINGS
------------------------------------------
Summary
-------
o Third quarter underlying earnings per share were $.51.
o Underlying after-tax operating income (ATOI) of $727 million. ATOI for the
quarter was $52 million lower than 1999 after overcoming a $235 million
after-tax cost increase for raw materials - oil, natural gas and their
derivatives.
o Average worldwide selling prices were 1 percent higher, the first time that
U.S. dollar prices have increased year-on-year since 1996. Global local
currency prices were 3 percent higher.
o Adverse currency effects reduced worldwide sales by 2 percent, primarily
due to the weaker Euro. On a local currency basis, European sales were up
12 percent, but were flat when reported in U.S. dollars.
o Segment sales of $7.4 billion increased 4 percent versus 1999 as sales
volumes grew 2 percent. Volume growth outside the United States of
6 percent offset a 2 percent U.S. decline. Consolidated sales were
$6.4 billion, flat versus 1999.
Earnings Comparisons - Third Quarter
------------------------------------
($ per share diluted)
Including
Underlying One-Time Items
-------------- ---------------
2000 1999 2000 1999
---- ---- ---- -----
Continuing Operations $.51 $.59 $.53 $ .17
Discontinued Operations - .06 - 6.98
Total $.51 $.65 $.53 $7.15
2
<PAGE>
DuPont reported earnings from continuing operations, before one-time
items, of $.51 per share for the third quarter, versus $.59 per share earned
in last year's third quarter, and $2.26 per share for the nine months of 2000
versus $2.02 in the same period last year.
"During the third quarter, DuPont faced one of the most significant
economic challenges in decades," said Charles O. Holliday, Jr., DuPont
chairman and chief executive officer. "By raising prices, improving our
productivity and growing volume, we overcame $200 million of a $250 million
after-tax earnings impact from surging raw materials costs and currency. This
is a real credit to DuPont employees and to our diverse mix of businesses."
Global Sales and Income Highlights
----------------------------------
Including one-time items in the third quarter, income from continuing
operations was $562 million versus $181 million last year, resulting in
earnings per share of $.53 compared to $.17 last year. One-time items, all of
which were previously announced, are detailed in the notes to the accompanying
financial statements and summarized in the table below:
3
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$MM Pretax $MM After-Tax ($ Per Share)
------------- ------------- -------------
3Q 00 3Q 99 3Q 00 3Q 99 3Q 00 3Q 99
----- ----- ----- ----- ----- -----
Purchase Accounting/
Post Employment
Costs - Pioneer (50) (55) (.06)
Sale of Interest in
Quimica Fluor
Affiliate -
Pigments & Chemicals 23 16 .02
Chambers Works
Restructuring -
Pigments & Chemicals (28) (17) (.02)
Restructuring -
Agriculture &
Nutrition (170) (107) (.10)
Restructuring - Nylon (364) (337) (.32)
Sale of Stock - DuPont
Photomasks, Inc. 123 81 .08
--- --- -- --- --- ---
Total 68 (534) 25 (444) .02 (.42)
Third quarter income from continuing operations before one-time items was
$537 million, compared to $625 million in third quarter of 1999, down
$88 million or 14 percent. Higher sales volume and higher local selling
prices were more than offset by the negative impact of higher raw material
costs, a stronger U.S. dollar, and higher Pioneer seasonal operating losses
due to increased ownership.
Third quarter 2000 consolidated sales of $6.4 billion were flat versus
third quarter 1999. Segment sales and transfers, which include a pro rata
share of affiliates' sales, were $7.4 billion, up 4 percent from $7.1 billion
last year. This increase is the result of 2 percent higher volume, 3 percent
4
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higher local prices and 1 percent added from the Pioneer acquisition, partly
offset by currency effect from the strong U.S. dollar which reduced worldwide
sales by 2 percent. Regional segment sales and related variances are
summarized below:
% Change Due To
-------------------------------------
3Q 00 % Change Local Currency Portfolio
Segment Sales $B vs. 3Q 99 Price Effect Volume Changes
---------------- ----- --------- ----- -------- ------ ---------
Worldwide 7.4 4 3 (2) 2 1
U.S. 3.7 0 3 0 (2) (1)
Europe 1.7 0 4 (11) 7 0
Asia 1.2 20 2 3 8 7
Canada, Mexico,
S. America 0.8 11 3 0 1 7
o U.S. sales volume dropped 2 percent reflecting lower sales of TiO2,
automotive finishes, and apparel fibers.
o Asia Pacific sales increased 20 percent reflecting 5 percent higher U.S.
dollar (USD) prices, higher volume and increased polyester sales resulting
from joint venture growth in the region.
o European sales reflect 7 percent volume growth essentially offset by lower
USD prices resulting from the impact of weaker European currencies.
o Portfolio changes reflect increased ownership of Pioneer (which increased
third quarter sales in South America) and restructuring the Polyester
Enterprise through formation of joint ventures (which increased sales in
Asia and decreased sales in the United States).
Outlook
-------
"Throughout the year, we have performed remarkably well in largely
offsetting the impacts of significantly higher oil and gas prices on raw
material costs and energy, and we have kept our focus on raising prices,
improving productivity and increasing volume - positioning our businesses for
improved performance," Holliday said. "However, in light of slowing global
economies, we are cautious about the prospects for top-line growth in the
5
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fourth quarter. In addition, we expect significantly lower fourth quarter
results from the Pharmaceuticals Segment as we phase out sales promotion
programs. Given these circumstances, it appears that the best underlying
earnings we can reasonably expect to achieve for 2000 is $2.85 per share, the
low end of our previously announced range. Should macro economic and currency
factors turn more negative, the additional downward pressure on earnings will
be very difficult to offset. Nevertheless, even given a more negative
environment, we expect meaningful growth in full year underlying earnings per
share."
Six Sigma
---------
Six Sigma implementation continues to gain momentum. At the end of
the third quarter there were over 1,000 trained Black Belts and 2,800 active
projects. The potential annualized pretax benefit from active projects at the
end of the third quarter was $500 million. The actual annualized pretax
benefit of completed projects at the end of the third quarter was
$260 million. At the end of the second quarter these annualized pretax
benefits were about $450 million and $110 million, respectively.
Business Segment Performance
----------------------------
Segment ATOI before one-time items was $727 million in the third
quarter, down 7 percent. Results for individual segments are summarized
below:
o Performance Coatings & Polymers - Segment earnings increased 10 percent,
principally reflecting improvement in Performance Coatings in Europe.
Phase II of the Herberts integration remains on schedule. Engineering
Polymers earnings were lower as increased volumes were more than offset by
the negative impact of the weak Euro and higher ingredient costs.
Elastomers earnings were flat versus last year.
6
<PAGE>
o Specialty Fibers - Segment earnings were 12 percent lower as increased
earnings from "Kevlar" fiber and "Nomex" fiber and paper were more than
offset by lower "Lycra" elastane earnings. On a weighted average basis,
elastane USD pricing ("Lycra" and unbranded) for the Lycra strategic
business unit (SBU) declined versus prior year. Worldwide volumes were
flat as volume growth in Asia and Europe was offset by weaker volumes in
the United States. The Lycra SBU's "Terathane" polyether glycol earnings
were reduced by higher natural gas prices.
o Specialty Polymers - Segment sales and earnings increased 6 and 5 percent,
respectively, as continued sales and earnings growth from DuPont
iTechnologies, Fluoropolymers, and "Corian" solid surfaces were partially
offset by lower results from Packaging and Industrial Polymers (P&IP).
P&IP showed flat sales and substantially reduced earnings, primarily
resulting from the stronger dollar and significantly higher ethane prices.
The remainder of the segment delivered double digit sales and earnings
growth.
o Pigments & Chemicals - Segment earnings increased 4 percent on 7 percent
higher sales. Earnings improvements in White Pigment and Mineral Products
reflect price and volume increases partly offset by higher chlorine and
energy costs. Continued strong TiO2 volume growth outside the United
States was partly offset by declining U.S. volumes. A modest earnings
improvement in DuPont Chemical Solutions was driven by higher prices.
Fluorochemicals results were essentially flat as earnings were adversely
affected by higher natural gas and methanol prices.
o Polyester Enterprise - Segment earnings were $19 million versus a loss of
$23 million last year, a $42 million turnaround. This principally reflects
a substantial reduction in fixed costs achieved through productivity
measures and restructuring. While markets generally continue to be weak,
the business has been able to partly offset higher raw material costs with
higher selling prices, specifically in resins, intermediates, and
filaments.
o Nylon Enterprise - Segment revenue increased 5 percent based on 3 percent
higher prices and 2 percent higher volumes. However, a significant run-up
in feedstock costs more than offset top-line growth, resulting in a
15 percent earnings decline for the segment. Demand continues to be strong
for industrial nylon, but is softening in certain apparel segments,
primarily in Europe, and to a lesser extent, in the United States. In
addition, there has been some softening in U.S. demand in the residential
segment of the flooring systems business.
o Agriculture & Nutrition - Segment earnings were $13 million versus a loss
of $10 million in the third quarter of last year. The earnings improvement
reflects 7 percent higher revenue and lower costs as the result of last
year's restructuring in Crop Protection Products. Crop Protection Products
worldwide volume increased with significant growth from new products in
7
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North America specialty markets and a strong growing season in South
America. Partly offsetting these improvements in the segment were
increased raw material costs and higher advertising costs for the Nutrition
and Health SBU.
o Pioneer - Segment earnings were a loss of $97 million versus a loss of
$26 million in 1999. This reflects full ownership versus 20 percent
ownership last year and the normal seasonal operating losses. With more
than 90 percent of the sales for the year now complete, Pioneer projects
2000 corn and soybean revenue to increase 6 percent and 12 percent,
respectively, versus 1999 on a comparable basis.
o Pharmaceuticals - Segment sales were essentially flat versus third quarter
1999 as higher sales of SustivaTM efavirenz and "Cardiolite" cardiac
imaging agent were offset by lower sales of "Coumadin" anticoagulant and
"Sinemet Brand". Earnings declined to $41 million compared to $58 million
last year, principally due to planned higher selling and research and
development expenses.
Major product sales are shown below:
($ in millions) 3Q 2000 3Q 1999 YR 1999
------------------------ ------- ------- -------
"Coumadin" 80 124 464
SustivaTM 99 50 211
"Sinemet Brand" 34 58 331
"Cardiolite"/MiralumaTM 77 51 210
Market share continued to grow for SustivaTM in all countries where it is
approved for sale. In September, total prescriptions for SustivaTM
surpassed "Viracept", the most widely prescribed protease inhibitor in the
United States. "Coumadin" warfarin sodium share was stable at 67 percent,
with total warfarin prescription growth up 6 percent versus the third
quarter last year. "Coumadin" sales declined versus last year as a result
of a strong promotional program in the third quarter of 1999. "Cardiolite"
sales benefited from a 16 percent increase in demand, while "Sinemet Brand"
sales declined due to increased generic competition.
Over the past three years DuPont Pharmaceuticals has implemented various
promotional sales programs. These programs were put in place to ensure a
fully adequate supply of product in the marketplace and, in the case of
"Sinemet Brand", to fully capitalize on the period in which we were
actively promoting the product. These promotional programs were successful
and market conditions have stabilized. As a result, these programs are no
longer required nor financially justified and, accordingly, the company
decided to phase them out. The impact of this action is expected to reduce
pharmaceuticals sales by approximately $100 million per quarter until
mid-2001. ATOI is expected to be substantially lower in the fourth
quarter 2000 than in the current quarter.
8
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Forward-Looking Statements: This news release contains forward-looking
statements based on management's current expectations, estimates and
projections. All statements that address expectations or projections about
the future, including statements about the company's strategy for growth,
product development, market position, expected expenditures and financial
results are forward-looking statements. Some of the forward-looking state-
ments may be identified by words like "expects," "anticipates," "plans,"
"intends," "projects," "indicates," and similar expressions. These state-
ments are not guarantees of future performance and involve a number of risks,
uncertainties and assumptions. Many factors, including those discussed more
fully elsewhere in this release and in DuPont's filings with the Securities
and Exchange Commission, particularly its latest annual report on Form 10-K,
as well as others, could cause results to differ materially from those stated.
These factors include, but are not limited to changes in the laws, regula-
tions, policies and economic conditions of countries in which the company does
business; competitive pressures; successful integration of structural changes,
including restructuring plans, acquisitions, divestitures and alliances;
research and development of new products, including regulatory approval and
market acceptance, seasonality of sales of agricultural products.
###
10/25/00
9
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<TABLE>
E. I. DU PONT DE NEMOURS AND COMPANY AND CONSOLIDATED SUBSIDIARIES
<CAPTION>
Three Months Ended Nine Months Ended
CONSOLIDATED INCOME STATEMENT September 30 September 30
-------------------------------------------------------------------------------------------------------------
(Dollars in millions, except per share) 2000 1999 2000 1999
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SALES ....................................................... $6,445 $6,459 $21,952 $19,778
Other Income<Fa> ............................................ 420 159 986 412
------ ------ ------- -------
Total ..................................................... 6,865 6,618 22,938 20,190
------ ------ ------- -------
Cost of Goods Sold and Other Operating Charges<Fb> .......... 4,135 4,110 14,019 12,310
Selling, General and Administrative Expenses ................ 710 624 2,276 1,784
Depreciation ................................................ 351 373 1,055 1,081
Amortization of Goodwill and Other Intangible Assets<Fc> .... 113 52 329 136
Research and Development Expense ............................ 442 394 1,323 1,139
Interest Expense ............................................ 205 120 616 333
Purchased In-Process Research and Development<Fd> ........... - - (11) 40
Employee Separation Costs and Write-Down of Assets<Fe> ...... 28 534 126 596
Gain on Issuance of Stock by Affiliates - Nonoperating<Ff> .. (29) - (29) -
------ ------ ------- -------
Total ..................................................... 5,955 6,207 19,704 17,419
------ ------ ------- -------
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND
MINORITY INTERESTS ........................................ 910 411 3,234 2,771
Provision for Income Taxes .................................. 339 216 1,133 1,066
Minority Interests in Earnings of Consolidated Subsidiaries . 9 14 48 50
------ ------ ------- -------
INCOME FROM CONTINUING OPERATIONS ........................... 562 181 2,053 1,655
DISCONTINUED OPERATIONS
Gain on Disposal of Discontinued Business,
Net of Income Taxes<Fg> ................................. - 7,349 - 7,455
------ ------ ------- -------
NET INCOME .................................................. $ 562 $7,530 $ 2,053 $ 9,110
====== ====== ======= =======
BASIC EARNINGS PER SHARE OF COMMON STOCK<Fh><Fi>
Continuing Operations ..................................... $ .54 $ .17 $ 1.96 $ 1.50
Discontinued Operations ................................... - 7.08 - 6.79
------ ------ ------- -------
Net Income ................................................ $ .54 $ 7.25 $ 1.96 $ 8.29
====== ====== ======= =======
DILUTED EARNINGS PER SHARE OF COMMON STOCK<Fh><Fi>
Continuing Operations ..................................... $ .53 $ .17 $ 1.94 $ 1.48
Discontinued Operations ................................... - 6.98 - 6.71
------ ------ ------- -------
Net Income ................................................ $ .53 $ 7.15 $ 1.94 $ 8.19
====== ====== ======= =======
DIVIDENDS PER SHARE OF COMMON STOCK ......................... $ .35 $ .35 $ 1.05 $ 1.05
====== ====== ======= =======
</TABLE>
10
<PAGE>
[FN]
FOOTNOTES TO CONSOLIDATED INCOME STATEMENT
------------------------------------------
<Fa> Third quarter 2000 includes gains of $117 resulting from the sale of
stock that reduced the Company's ownership interest in DuPont Photomasks
and the sale of the Company's interest in a Mexican affiliate.
Year-to-date 2000 also includes a $176 gain resulting from the sale by
Pioneer of certain equity securities classified as available for sale.
Year-to-date 1999 includes a $131 exchange loss on forward exchange
contracts purchased in 1998 to lock in the U.S. dollar cost of the
acquisition of Herberts.
<Fb> In accordance with purchase accounting rules applied to the acquisition
of the remaining 80 percent ownership interest in Pioneer on October 1,
1999, Pioneer inventory was increased to fair value. This inventory
step-up generates noncash charges to cost of goods sold as the inventory
on hand at the acquisition date is sold. Third quarter and year-to-date
2000 charges were $21 and $588, respectively.
Third quarter 2000 also includes a charge of $29 for accrued post-
employment costs for Pioneer employees. Year-to-date 2000 also includes
a charge of $100 to increase the Company's reserve for "Benlate" 50 DF
fungicide litigation.
<Fc> 2000 includes amortization expense associated with acquisitions of
Herberts and Pioneer. Prior to October 1, 1999, the Company's 20
percent ownership in Pioneer was accounted for under the equity method
and results (including amortization expense) were reported as a
component of Other Income. 1999 includes amortization expense
associated with the Herberts acquisition beginning in the second
quarter.
<Fd> Year-to-date 2000 includes a credit of $11 that was recorded based on
revisions of preliminary purchase price allocations associated with the
October 1, 1999 purchase of the remaining 80 percent ownership interest
in Pioneer. Year-to-date 1999 includes an estimated charge of $40 that
was recorded in conjunction with the purchase of Herberts, based on
preliminary allocations of purchase price.
<Fe> Third quarter 2000 charges of $28 result from restructuring
manufacturing operations at the Chambers Works site; this includes $24
related to the shutdown of operating facilities and $4 attributable to
separation costs for about 65 employees. Year-to-date 2000 also
includes charges of $98 attributable to the continued restructuring of
the performance coatings business. This charge includes $73 related to
the termination of about 1,000 employees, $13 for the shutdown of
related manufacturing facilities, and $12 for other exit costs.
11
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[FN]
FOOTNOTES TO CONSOLIDATED INCOME STATEMENT - (CONT'D)
-----------------------------------------------------
Third quarter 1999 charges of $534 primarily result from restructuring
activities within Agriculture & Nutrition and within the Nylon
Enterprise. The charge for Agriculture & Nutrition totaled $170 and
included termination payments to about 800 employees, the shutdown of
various manufacturing facilities, and the write-off of an intangible
asset resulting from the loss of exclusive product marketing rights.
The Nylon Enterprise charge totaled $364, of which $252 represents an
impairment charge for the write-down of an adipic acid plant in
Singapore that continues to operate. Other costs are principally due to
the write-down of manufacturing assets in India pursuant to a sales
agreement and the liquidation of a joint venture in China.
Year-to-date 1999 charges also includes $62 of employee separation costs
for about 850 employees within the Polyester Enterprise.
<Ff> Represents an increase in the Company's equity investment in DuPont
Photomasks that resulted from the issuance by DuPont Photomasks of
additional shares to unrelated parties at a price in excess of book
value.
<Fg> Gain on disposal of discontinued business reflects Conoco's operations
through August 6, 1999 and includes the gain of $7,291 realized by the
Company from the completion of the Conoco exchange offer.
<Fh> Earnings per share are calculated on the basis of the following average
number of common shares:
Three Months Ended Nine Months Ended
September 30 September 30
----------------------------- -----------------------------
Basic Diluted Basic Diluted
------------- ------------- ------------- -------------
2000 1,041,269,308 1,047,777,845 1,044,708,476 1,052,825,218
1999 1,038,268,303 1,052,845,443 1,097,795,167 1,111,388,460
<Fi> Year-to-date earnings per share do not equal the sum of quarterly
earnings per share due to changes in average share calculations.
12
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<TABLE>
E. I. DU PONT DE NEMOURS AND COMPANY AND CONSOLIDATED SUBSIDIARIES
<CAPTION>
CONSOLIDATED SEGMENT INFORMATION - Three Months Ended Nine Months Ended
CONTINUING OPERATIONS<Fa> September 30 September 30
-------------------------------------------------------------------------------------------------------------
(Dollars in millions) 2000 1999 2000 1999
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SEGMENT SALES<Fb>
-------------
Agriculture & Nutrition ...................... $ 454 $ 423 $ 1,923 $ 1,970
Nylon Enterprise ............................. 1,150 1,097 3,445 3,349
Performance Coatings & Polymers .............. 1,572 1,592 4,941 4,398
Pharmaceuticals .............................. 389 384 1,172 1,173
Pigments & Chemicals ......................... 974 912 2,972 2,727
Pioneer ...................................... 129 38 1,853 363
Polyester Enterprise ......................... 657 668 1,922 1,935
Specialty Fibers ............................. 848 852 2,645 2,572
Specialty Polymers ........................... 1,124 1,057 3,366 3,103
Other ........................................ 108 115 380 352
------ ------ ------- -------
Total Segment Sales ........................ 7,405 7,138 24,619 21,942
Elimination of Intersegment Transfers ........ (165) (190) (501) (542)
Elimination of Equity Affiliate Sales ........ (799) (492) (2,172) (1,624)
Miscellaneous ................................ 4 3 6 2
------ ------ ------- -------
SALES ...................................... $6,445 $6,459 $21,952 $19,778
====== ====== ======= =======
AFTER-TAX OPERATING INCOME (LOSS)
---------------------------------
Agriculture & Nutrition ...................... $ 13 $ (117)<Fc> $ 149 <Fd> $ 127 <Fc>
Nylon Enterprise ............................. 74 (250)<Fe> 249 (44)<Fe>
Performance Coatings & Polymers .............. 170 155 478 <Ff> 415 <Fg>
Pharmaceuticals .............................. 41 58 146 182
Pigments & Chemicals ......................... 168 <Fh> 162 518 <Fh> 466
Pioneer ...................................... (152)<Fi> (26) (69)<Fi> 26
Polyester Enterprise ......................... 19 (23) 39 (82)<Fj>
Specialty Fibers ............................. 167 189 543 538
Specialty Polymers ........................... 175 166 523 494
Other ........................................ 58 <Fk> 21 65 <Fk> 44
------ ------ ------- -------
Total Segment ATOI ......................... 733 335 2,641 2,166
Interest & Exchange Gains and Losses ......... (122) (81) (381) (292)<Fl>
Corporate Expenses ........................... (49)<Fm> (73) (207)<Fm> (219)
------ ------ ------- -------
INCOME FROM CONTINUING OPERATIONS .......... $ 562 $ 181 $ 2,053 $ 1,655
====== ====== ======= =======
</TABLE>
13
<PAGE>
[FN]
NOTES TO CONSOLIDATED SEGMENT INFORMATION - CONTINUING OPERATIONS
-----------------------------------------------------------------
<Fa> Certain reclassifications of segment data have been made to reflect
changes in organizational structure.
<Fb> Includes pro rata equity affiliate sales and intersegment transfers.
<Fc> Includes total charges of $107 attributable to termination payments to
about 800 employees, shutdown of various manufacturing facilities and
the write-off of an intangible asset resulting from the loss of
exclusive product marketing rights.
<Fd> Includes a charge of $62 to increase the Company's reserve for "Benlate"
50 DF fungicide litigation.
<Fe> Includes total charges of $337, of which $247 is attributable to an
impairment charge for the write-down of the adipic acid plant in
Singapore that continues to operate. Other costs are principally due to
the write-down of manufacturing assets in India pursuant to a sales
agreement and the liquidation of a joint venture in China.
<Ff> Includes a charge of $61 related to employee separation costs for about
1,000 employees within Performance Coatings, the shutdown of related
manufacturing facilities, and other exit costs.
<Fg> Includes an estimated in-process research and development charge of $40
that was recorded in conjunction with the purchase of Herberts, based on
preliminary allocations of purchase price.
<Fh> Includes a charge of $17 resulting from restructuring manufacturing
operations at the Chambers Works site, offset by a gain of $16
attributable to the sale of the Company's interest in a Mexican
affiliate.
<Fi> Third quarter includes a charge of $42 for accrued post-employment costs
for Pioneer employees and tax adjustments related to finalization of
purchase accounting, as well as a noncash charge of $13 resulting from
the sale of acquired Pioneer inventories which, in accordance with
purchase accounting rules, were recorded at fair value on October 1,
1999. Year-to-date includes noncash charges of $366 resulting from the
sale of acquired Pioneer inventories and the $42 charge for accrued
post-employment costs, partly offset by a $109 gain resulting from the
sale by Pioneer of certain equity securities classified as available for
sale, and a credit of $11 to reduce the preliminary purchase price
allocated to purchased in-process research and development.
<Fj> Includes a charge of $40 related to employee separation costs for about
850 employees within the Polyester Enterprise.
14
<PAGE>
[FN]
NOTES TO CONSOLIDATED SEGMENT INFORMATION - CONTINUING OPERATIONS - (CONT'D)
----------------------------------------------------------------------------
<Fk> Includes a gain of $62 resulting from the sale of stock that reduced the
Company's ownership interest in DuPont Photomasks.
<Fl> Includes an exchange loss of $81 on forward exchange contracts purchased
in 1998 to lock in the U.S. dollar cost of the acquisition of Herberts.
The purchase price for Herberts was negotiated in German marks.
<Fm> Includes a nonoperating gain of $19 on issuance of stock by affiliates.
This represents the increase in the Company's equity investment in
DuPont Photomasks that resulted from the issuance by DuPont Photomasks
of additional shares to unrelated parties at a price in excess of book
value.
15
<PAGE>
<TABLE>
E. I. DU PONT DE NEMOURS AND COMPANY AND CONSOLIDATED SUBSIDIARIES
<CAPTION>
SEGMENT SALES<Fa>
(3RD QUARTER 2000 VS 3RD QUARTER 1999)
------------------------------------------------------------------------------------------------------------------
Segment Sales
Three Months Ended
September 30 Percentage Change Due to:
------------------ ----------------------------
<S> <C> <C> <C> <C> <C>
U.S.$
$ Change Price Volume Other<Fb>
------ ------ ------ ------ --------
Agriculture & Nutrition ................................... $ 454 7% (5)% 12%
Nylon Enterprise .......................................... 1,150 5 3 2
Performance Coatings & Polymers ........................... 1,572 (1) 1 (2)
Pharmaceuticals ........................................... 389 1 N/M N/M
Pigments & Chemicals ...................................... 974 7 3 4
Pioneer ................................................... 129 239 - - 239%
Polyester Enterprise ...................................... 657 (2) 5 (6) (1)
Specialty Fibers .......................................... 848 0 (2) 2
Specialty Polymers ........................................ 1,124 6 2 4
Other ..................................................... 108 (6) - - (6)
<FN>
--------------
<Fa>Includes transfers and pro rata share of equity affiliate sales.
<Fb>Includes sales increase/(decrease) due to acquisitions and divestitures.
</TABLE>
<TABLE>
<CAPTION>
SEGMENT INFORMATION EXCLUDING
IMPACT OF ONE-TIME ITEMS - Three Months Ended Nine Months Ended
CONTINUING OPERATIONS September 30 September 30
-----------------------------------------------------------------------------------------------------------------
(Dollars in millions) 2000 1999 % Chg. 2000 1999 % Chg.
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
AFTER-TAX OPERATING INCOME
--------------------------
Agriculture & Nutrition ................................... $ 13 $ (10) N/M $ 211 $ 234 (10)%
Nylon Enterprise .......................................... 74 87 (15)% 249 293 (15)
Performance Coatings & Polymers ........................... 170 155 10 539 455 18
Pharmaceuticals ........................................... 41 58 (29) 146 182 (20)
Pigments & Chemicals ...................................... 169 162 4 519 466 11
Pioneer ................................................... (97) (26) N/M 219 26 N/M
Polyester Enterprise ...................................... 19 (23) N/M 39 (42) N/M
Specialty Fibers .......................................... 167 189 (12) 543 538 1
Specialty Polymers ........................................ 175 166 5 523 494 6
Other ..................................................... (4) 21 N/M 3 44 (93)
----- ----- ------ ------
Total Segment ATOI ...................................... 727 779 (7) 2,991 2,690 11
Interest & Exchange Gains and Losses ...................... (122) (81) (381) (211)
Corporate Expenses ........................................ (68) (73) (226) (219)
----- ----- ------ ------
INCOME FROM CONTINUING OPERATIONS ....................... $ 537 $ 625 (14)% $2,384 $2,260 5%
===== ===== ====== ======
</TABLE>
16
<PAGE>
<TABLE>
FINANCIAL SUMMARY - CONTINUING OPERATIONS
-----------------------------------------
(Dollars in millions, except per share)
<CAPTION>
Three Months Ended Nine Months Ended
September 30 September 30
-------------------------- --------------------------
2000 1999 % Chg. 2000 1999 % Chg.
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Selected Income Statement Data -
Excluding Impact of One-Time Items
----------------------------------
Sales .......................................... $6,445 $6,459 0% $21,952 $19,778 11%
Segment ATOI ................................... 727 779 (7) 2,991 2,690 11
EBIT ........................................... 1,037 1,050 (1) 4,312 3,820 13
EBITDA ......................................... 1,501 1,475 2 5,696 5,037 13
Income From Continuing Operations .............. 537 625 (14) 2,384 2,260 5
EPS - Diluted .................................. 0.51 0.59 (14) 2.26 2.02 12
</TABLE>
<TABLE>
<CAPTION>
3rd Quarter 2000 Vs.
3rd Quarter 1999
--------------------
<S> <C>
Segment ATOI Variance Analysis -
Excluding Impact of One-Time Items
----------------------------------
Prices ......................................... $ 159
Volume ......................................... 65
Costs .......................................... (211)
Other .......................................... (40)
Currency ....................................... (18)
Portfolio Change ............................... (7)
-----
Total ........................................ $ (52)
=====
</TABLE>
17
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
E. I. DU PONT DE NEMOURS AND COMPANY
(Registrant)
/s/ D. B. Smith
------------------------------------
D. B. Smith
Assistant Controller
October 25, 2000
18
