Dow Corning Reports Sales and Profits for Third Quarter of 2012

  Dow Corning Reports Sales and Profits for Third Quarter of 2012

Business Wire

MIDLAND, Mich. -- October 26, 2012

DowCorning Corp. today announced sales of $4.64 billion and net income of
$288 million through the first three quarters of 2012. Dow Corning’s
year-to-date sales and net income were down 5 percent and 47 percent,
respectively, compared to 2011 as oversupply, economic volatility and high raw
material costs continue to challenge the company’s profits. Additional
information about Dow Corning’s financial results:

J. Donald Sheets, Dow Corning's executive vice president and chief financial
officer (Photo: Busines ...

J. Donald Sheets, Dow Corning's executive vice president and chief financial
officer (Photo: Business Wire)

                            Third Quarter Results

  *Sales were $1.55billion, 7 percent lower than last year’s third quarter.
  *Polysilicon prices remain depressed due to industry oversupply, impacting
    the company’s Hemlock Semiconductor Group joint ventures.
  *Sales in Europe were significantly lower due to continuing economic
  *Net income was $97 million, 45 percent lower than last year’s third

                             Year-to-Date Results

  *Sales were $4.64billion, 5 percent lower than last year.
  *Net income was $288 million, 47 percent lower than last year.

             Q3 2012    Q3 2011    % Change   2012       2011    %
Sales (in     $  1.55    $  1.66    -7    %    $  4.64    $ 4.91  -5   %
Net income
(in           $  97      $  177     -45   %    $  288     $ 547   -47  %
net income*   $  77      $  173     -56   %    $  269     $ 536   -50  %
*Adjusted net income is a non-GAAP financial measure which excludes certain
unusual items. The reconciliation
between GAAP and non-GAAP measures is shown in the table following the news

Comments from Dow Corning’s Executive  Vice President and Chief Financial
Officer J.DonaldSheets:

  *“Oversupply in both the silicone and polycrystalline silicon industries,
    as well as high raw material costs have impacted our financial performance
    throughout 2012, and these conditions are likely to last well into 2013.”
  *“Our Hemlock Semiconductor joint ventures continue to be challenged by
    global oversupply in the polycrystalline silicon markets. Additionally,
    the economic and political uncertainty surrounding the solar industry is
    also impacting Hemlock Semiconductor’s performance.”
  *“Dow Corning’s response to the volatile economy and oversupplied
    marketplace is to focus on delivering innovative silicon-based products
    and solutions to our customers that differentiate us from our
  *“We also continue to pursue opportunities to increase efficiency and
    reduce costs in our operations, ultimately protecting the competitive cost
    position Dow Corning has earned through its nearly 70 years of

About Dow Corning

Dow Corning ( provides performance-enhancing solutions to
serve the diverse needs of more than 25,000 customers worldwide. A global
leader in silicones, silicon-based technology and innovation, Dow Corning
offers more than 7,000 products and services via the company’s Dow Corning^®
and XIAMETER^® brands. Dow Corning is equally owned by The Dow Chemical
Company and Corning, Incorporated. More than half of Dow Corning’s annual
sales are outside the United States.

About Hemlock Semiconductor Group

Hemlock Semiconductor Group (Hemlock Semiconductor) is comprised of several
joint venture companies among Dow Corning Corporation, Shin-Etsu Handotai, and
Mitsubishi Materials Corporation. Hemlock Semiconductor is a leading provider
of polycrystalline silicon and other silicon-based products used in the
manufacturing of semiconductor devices, and solar cells and modules. Hemlock
Semiconductor began its operations in 1961.

Dow Corning Corporation
Selected Financial Information
(in millions of U. S. dollars)

Consolidated Income Statement Data
                   Three Months Ended September      Nine Months Ended
                   30,                               September 30,
                   2012              2011            2012          2011
Net Sales          $  1,545.2        $  1,660.4      $ 4,638.3     $ 4,907.8
Net Income
   to Dow          $  96.6           $  177.0        $ 288.4       $ 546.5
Adjustment for
Long-Term Sales    $  (19.7    )                     $ (19.7   )
Adjustment for     $  -             $  (4.0     )   $ -          $ (10.5   )
AEMC^2, net
Adjusted Net       $  76.9          $  173.0       $ 268.7      $ 536.0   

^1  The three and nine month periods ended September 30, 2012 included an
     adjustment for the gain on long-term sales agreements.
     The three and nine month periods ended September 30, 2011 included a tax
^2   benefit related to Advanced Energy Manufacturing Credits, net of the
     noncontrolling interests' share.
^3   Adjusted Net Income is a non-GAAP financial measure which excludes
     certain unusual items and which reconciles to Net Income as shown.

Consolidated Balance Sheet Data
                                     September 30, 2012   December 31, 2011
Current Assets                       $     4,438.5        $     4,873.0
Property, Plant and Equipment, Net         7,747.0              7,380.3
Other Assets                              1,116.2             1,317.9
                                     $     13,301.7       $     13,571.2
Liabilities and Equity
Current Liabilities                  $     1,702.1        $     2,022.9
Other Liabilities                          7,766.0              7,963.4
Equity                                    3,833.6             3,584.9
                                     $     13,301.7       $     13,571.2

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Jarrod Erpelding, 989.496.1582
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