MORGAN STANLEY GLOBAL CHEMICALS CONFERENCE

Transcription

1 MORGAN STANLEY GLOBAL CHEMICALS CONFERENCE Paul Schickler, President, DuPont Pioneer November 12, 2014

2 Forward-Looking Statements This document contains forward-looking statements which may be identified by their use of words like plans, expects, will, "believes," intends, estimates, anticipates or other words of similar meaning. All statements that address expectations or projections about the future, including statements about the company's strategy for growth, product development, regulatory approval, market position, anticipated benefits of recent acquisitions, timing of anticipated benefits from restructuring actions, outcome of contingencies, such as litigation and environmental matters, expenditures and financial results, are forward looking statements. Forward-looking statements are not guarantees of future performance and are based on certain assumptions and expectations of future events which may not be realized. Forward-looking statements also involve risks and uncertainties, many of which are beyond the company s control. Some of the important factors that could cause the company s actual results to differ materially from those projected in any such forward-looking statements are: fluctuations in energy and raw material prices; failure to develop and market new products and optimally manage product life cycles; significant litigation and environmental matters; failure to appropriately manage process safety and product stewardship issues; changes in laws and regulations or political conditions; global economic and capital markets conditions, such as inflation, interest and currency exchange rates; business or supply disruptions; security threats, such as acts of sabotage, terrorism or war, weather events and natural disasters; ability to protect and enforce the company's intellectual property rights; successful integration of acquired businesses and separation of underperforming or nonstrategic assets or businesses and successful completion of the proposed spinoff of the Performance Chemicals segment including ability to fully realize the expected benefits of the proposed spinoff. The company undertakes no duty to update any forward-looking statements as a result of future developments or new information. Developing Markets Total 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 Center website at 2

3 DuPont is a Science Company DuPont has a 200-year record of creating value for customers and owners by connecting science to the marketplace to create novel solutions the world needs. Today, DuPont is creating higher growth and higher value for shareholders by leveraging advanced science and technology, market and value chain knowledge, global scale, and disciplined management to drive its next great era of innovation. 3

4 Path to Future Growth DuPont s Strategy To Build Higher Growth, Higher Value Agriculture & Nutrition Extend our leadership across the high-value, science-driven segments of the Agriculture and Food value chain Bio-Based Industrials Develop worldleading industrial biotechnology capabilities to create transformational new bio-based businesses Advanced Materials Strengthen and grow our leading position in differentiated highvalue materials and leverage new sciences Seeds Agricultural Chemicals Specialty Food Ingredients Enzymes Biofuels Biomaterials Advanced Polymers Protective Materials Electronic Materials Alternative Energy These Three Strategic Priorities Position DuPont For The Next Wave Of Innovation And Growth 4

5 DuPont Delivers Productivity and Profitability for Growers and Food Companies Ag Productivity Integrated seed solutions Germplasm / traits Seed-applied technologies Crop protection Decision services Nutrition Solutions DuPont holistically addresses the challenge Food of feeding Protection Bio-based Industrials the world / Packaging Solutions Improving agricultural productivity and animal feed efficiencies Biofuels, biomaterials and Enhancing the nutritional value of food biochemicals Protecting food Enzymes and reducing waste Specialty ingredients (enzymes cultures, probiotics, soy protein, emulsifiers, texturants, etc.) Animal nutrition Antimicrobials, antioxidants, diagnostics Specialty packaging resins (sealants, adhesives) Unique Capabilities Across the Ag and Food Value Chain 5

6 Global Demand Growth for Grain Emerging Middle Class (Billions) Million MT Global Corn B Other North America Europe B Asia-Pacific Production Consumption Long-term, Sustainable Demand Remains Intact Data Source: United Nations, OECD and USDA. 6

7 Growth Priorities in Agriculture Innovative Products and Services Genetic Improvement Optimum AcreMax Optimum AQUAmax Encirca SM Services T Series soybeans Plenish soybeans^ Rynaxypyr Cyazypyr Fungicides Lumigen Seed Sense Solutions Optimum Leptra ^ DP4114 Canola HT* Next Gen Soy Hybrid Rice Hybrid Wheat Extending our Global Reach Brazil Central and Eastern Europe Western Canada India China Africa Strong Market Positions Today, Attractive Growth Opportunities *Optimum GLY Herbicide Tolerance and LibertyLink Herbicide Tolerance for canola 7

8 Innovation Leading Insect Control Solutions in Corn Optimum AcreMax Family of Products Expected to represent about 70% of Pioneer NA corn volume in 2015 Optimum Leptra ^ Insect Protection Small, introductory launch expected in Brazil in 2015* DP4114 North America launch expected early in the 2 nd half of this decade* Multiple options to manage field-by-field insect control needs Multiple modes of action for protection against above and below ground insects Expanding lineup of triple-stack products Simplified refuge management High-yielding Pioneer genetics Maximize yield by protecting the potential of our superior genetics Multiple modes of action for enhanced protection against lepidopteran pests including earworm and fall armyworm Enhanced trait durability Limited, stewarded 2014 launch in the Southern US; strong yield performance with good grain quality Enables additional triple-stack product options with enhanced yield performance and strong agronomics Strong efficacy and performance in 2014 research trials Molecular stack of proven Herculex trait Bt proteins US and Canada cultivation approvals in place Optimum Leptra hybrid Control hybrid Tailored Options for Insect Control *Pending regulatory approvals 8

9 Innovation Optimum AQUAmax hybrids Optimum AQUAmax Hybrids AQUAmax vs. All Competitors Exceptional performance in water-limited environments AND Top-end yield potential under favorable conditions Planted on about 10 million acres in 2014 Optimum AQUAmax hybrids have delivered year after year across a wide variety of environments since 2011 Tested in over 50,000 on-farm comparisons since introduction in 2011 Continues to outperform competitive drought products Available in a wide-range of trait options Targeted for the Western corn belt and areas prone to chronic drought stress Native trait technology can be leveraged outside of the US (e.g. Ukraine and France) Continues to Deliver Rain or Shine Source: From 2011 to 2014, Optimum AQUAmax products were grown in on-farm against competitive hybrids (+/- 4 CRM) in 5,262 comparisons in water limited environments and 47,705 comparisons in favorable growing conditions. Water limited environments are those in which the water supply/demand ratio during flowering or grain fill was less than 0.66 on a 0-1 scale (1=adequate moisture as determined by Pioneer) using Pioneer's proprietary EnClass system and in which the average yield of the commercially available hybrids was less than 150 bu/acre. Moisture levels were measured at the nearest weather station. Favorable growing conditions are locations where yield l evels were at or above 150 bu/acre on average, regardless of moisture levels. Product performance in water-limited environments is variable and depends on many factors such as the severity and timing of moisture deficiency, heat stress, soil type, management practices and environmental stress as well as disease and pest pressures. All hybrids may exhibit reduced yield under water and heat stress. Individual results may vary. Product performance is variable and subject to any number of environmental, disease and pest pressures. 9

10 Innovation North America Corn Performance Strong Corn Performance In Grower Fields Double and Triple Stacks vs. All Competitors Performance advantage in top-end yield environments with many +300 bpa yields Optimum AQUAmax hybrids continue to perform rain or shine Promising 2014 class of new genetics with an improving triple stack lineup Outstanding performance in Western and Southern corn belt (113 and 118 maturities) Strength in 7 million acre silage market with growing BMR lineup New insect protection event DP4114 performing well in research trials Convenience of Optimum AcreMax insect protection in about 70% of 2015 volume Comparisons represent on-farm side-by-side results from growers fields Performance Leadership Under This Season s High-yielding Conditions Source: 2014 Pioneer on-farm trial database as of October 28, Customer comparisons based on 2014 yield results including data from weigh wagon and PKP trials for all Pioneer brand hybrids against all competitors. Individual results may vary. All data weighted by comparisons within 4CRM and adjusted to 15% moisture. Product performance is variable and subject to any number of environmental, disease and pest pressures. 10

11 Innovation New Corn Genetics Promising Class of New Genetics 2014 Class vs. All Competitors Industry leading genetic diversity, improved yield and agronomic performance protected by leading trait options 2014 class of new genetics are expected to represent about 20% of 2015 sales volume New genetics since 2012 are expected to represent about 60% of 2015 sales volume New classes locally tested and advanced from about 1,300 corn IMPACT trials annually New, Higher-yielding Genetics Create Pricing Opportunity Source: 2014 Pioneer on-farm trial database as of October 28, Customer comparisons based on 2014 yield results including data from weigh wagon and PKP trials compared against all competitors. Includes all new Pioneer hybrids released in 2014 vs. competitor brand hybrids tested in Individual results may vary. All data weighted by comparisons within 4CRM and adjusted to 15% moisture. Product performance is variable and subject to any number of environmental, disease and pest pressures. 11

12 Innovation New Technology for Soybean and Canola growers Pioneer brand T Series Soybeans Expect T Series mix to be about double in 2015 Plenish High Oleic Soybeans^ Biotech soybeans with consumer benefits Optimum GLY Canola Developed through proprietary gene shuffling technology Strong defensive traits Varieties containing the Genuity Roundup Ready 2 Yield trait are expected to be about 10% of volume in 2015 Newest Pioneer genetics with improved field emergence 2015 expected launch of native technology for increased flexibility and high tolerance to sulfonylurea herbicides Soy-based solution with 20% less saturated fat than commodity soybean oil Yields on par with Pioneer brand elite commercial varieties Expanded contracting options for growers in 2015 Import approval received in markets that represent about 90% of US soybean exports Provide growers increased application flexibility Offered in combination with Pioneer Protector traits Expected availability later this decade, pending regulatory approvals Out-licensing agreement recently signed with Crop Production Services (CPS) Technology Advancements in Oilseeds *Pending regulatory approvals 12

13 Innovation North America Soybean Performance Pioneer brand T Series soybeans Pioneer brand 2014 soybean class Solid competitive performance of T Series soybean varieties Promising 2014 T Series class of new genetics T Series expected to double in 2015 to nearly two-thirds of volume Genuity Roundup Ready 2 Yield expected to double in 2015 to about 10% of volume High Yield Protected By Defensive Trait Packages Source: 2014 Pioneer on-farm trial database as of October 28, Customer comparisons based on 2014 yield results including data from weigh wagon and PKP trials for all Pioneer brand varieties compared against all competitors. Individual results may vary. All data weighted by comparison within 3RM. Product performance is variable and subject to any number of environmental, disease and pest pressures. 13

14 Innovation - Encirca SM Services Strategic Collaborations Enhance Services The largest and most accurate Ag Weather Network* DTN Ag Weather Network Most granular view of soils and topography USDA-ARS University of Missouri Improved crop and nitrogen models Data generated by 8 Midwest land-grant universities Seamless transfer of data for real-time insights John Deere AGCO Raven Industries Strong grower adoption Encirca SM View 13,000+ Users Encirca SM Yield Nitrogen Management Service About 300,000 acres invoiced so far Addressing the most critical challenges growers face PROFITABILITY SUSTAINABILITY RISK MANAGEMENT CONVENIENCE Helping Growers Unlock The Full Potential Of Their Land *According to an independent Forecastwatch.com report, Schneider Electric, DTN/The Progressive Farmer's parent company, has delivered the industry's most accurate temperature and precipitation forecasts for the last seven consecutive years. This same forecast technology is used in DTN s solutions including the DTN Ag Weather Network, which contains over 2,000 individual weather stations. 14

15 Innovation - Encirca SM Yield Nitrogen Management Service Personalized Input Management Solutions Based on sub-field level Environmental Response Units (ERUs) Customized Nitrogen recommendations by ERU Managing by specific productivity potential to: Improve Low Productivity ERUs Optimize Medium Productivity ERUs Maximize High Productivity ERUs Opportunity to improve profitability by as much as $50-60 per acre through better nitrogen management $10 per acre service fee Tailored by a local Certified Services Agent (CSA) Most accurate, local weather data informed by the DTN Ag Weather Network improves probability of success Source: DuPont Pioneer, in collaboration with University of Missouri & USDA-ARS Example field, Willmar, MN Scalable Sub-field Management Offers The Next Inflection in Crop Productivity 15

16 Innovation Lumigen Seed Sense Solutions DuPont Lumiderm Insecticide Seed Treatment 2014 Initial Launch in Canada for Canola DuPont Dermacor Insecticide Seed Treatment 2014 Initial Launch in Brazil for soybeans on over 3 million acres DuPont Lumivia Insecticide Seed Treatment 2015 Planned Launch in the United States for Corn Offers enhanced protection from cutworms and flea beetles Residual control of insects up to 35 days after seedling Superb early season vigor Supports emergency registration in Brazil for control of Helicoverpa in soybeans Excellent above and below ground insect control to protect plant vigor Pursuing expansion to other crops and markets Improved yield advantage Offering enhanced protection from wireworm, black cutworm, white grubs and fall armyworm Available in the US exclusively on the newest Pioneer hybrids as part of the Pioneer Premium Seed Treatment program Extending DuPont Science Into Seed Treatment 16

17 Global Reach Key Growth Markets Corn 8 Sunflower 14 Oilseed Rape 3 Corn 40* Soybeans 33* Canola 9* Corn 36 Corn 12 Rice 42 Corn 14 Corn 19 Soybeans 30** Expect ~ 50% of Our Growth Over Next Five Years Outside of NA Note: Millions of hectares harvested. USDA 2014/15 estimate. * US & Canada show hectares planted ** Soybean hectares represent Brazil only. 17

18 Global Reach - Brazil Growth Drivers Corn and soybean strategy Corn 15 million hectares Soybeans 30 million hectares Rapid grower adoption of technology Leading Pioneer germplasm Local customer focus and route-to-market Investments in production and distribution capacity Small, introductory launch of Leptra insect protection expected in 2015, pending regulatory approvals Adoption of DuPont Dermacor insecticide seed treatment in soybeans DuPont Dermacor insecticide seed treatment for corn, pending regulatory approval 18

19 Global Reach Central and Eastern Europe Growth Drivers Multi-crop strategy Corn 8 million hectares Sunflower 14 million hectares Oilseed rape 3 million hectares Long history and local knowledge Recent investments in local research and production capacity Leading market position in corn today Optimum AQUAmax hybrids launched in 2014 Pioneer brand hybrids with the DuPont ExpressSun trait Pioneer MAXIMUS oilseed rape semi-dwarf hybrids 19

20 Global Reach - India Growth Drivers Multi-crop strategy Rice 42 million hectares Corn 12 million hectares Mustard and Millet Long history and local knowledge Hybrid Rice Technology Unique route-to-market Pioneer Pravatka and mobile outreach Multi-crop Research Centers with focus on molecular breeding, native traits and drought tolerance DuPont Knowledge Center 20

21 Global Reach - China Growth Drivers 36 million hectare corn market Aligned with China s goals in agriculture Modernization and mechanization of Chinese agriculture Leading the professionalization of the Chinese seed industry Local investments in breeding (established in 1998) Industry leading molecular breeding technology center State-of-the-art production facilities Professional sales channel 21

22 Right Product Right Acre 22

23 Appendix 1: 2014 On-farm Performance 23

24 2014 Area Top Volume Leaders Package vs. All Competitors (Corn) Northwest Iowa Yld. Adv. / % Wins P0157AMX (AMX/LL/RR2) % P0193AMX (AMX/LL/RR2) % P0297AMXT (AMXT/LL/RR2) % P0506AM (AM/LL/RR2)) % P0533AM1 (AM1/LL/RR2) % 2.1 mm Acres NC, W Nebraska Yld. Adv. / % Wins P0302CHR (RW/HX1/LL/RR2) % P0419AMX (AMX/LL/RR2) % P0832AMX (AMX/LL/RR2) % P1151AMX (AMX/LL/RR2) % P1266AM (AM/LL/RR2) % N Wisconsin, NE Minnesota Yld. Adv. / % Wins P9526AMX (AMX/LL/RR2) % P9644AMX (AMX/LL/RR2) % P9807AM (AM/LL/RR2) % P0157AMX (AMX/LL/RR2) % P0533AM1 (AM1/LL/RR2) % 2.6 mm Acres Northeast Indiana Yld. Adv. / % Wins P0157AMX (AMX/LL/RR2) % P0496AMX (AMX/LL/RR2) % P0506AM (AM/LL/RR2) % P0636AM (AM/LL/RR2) % P1197AM (AM/LL/RR2) % 1.9 mm Acres 2.4 mm Acres Southeast Nebraska Yld. Adv. / % Wins P1105AM (AM/LL/RR2) % P1151AM (AM/LL/RR2) % P1197CHR (RW/HX1/LL/RR2) % P1602AM (AM/LL/RR2) % P1690CHR (RW/HX1/LL/RR2) % 2.4 mm Acres DE, MD, NJ, East PA Yld. Adv. / % Wins P0210AM (AM/LL/RR2) % P0506AM (AM/LL/RR2) % P0604AM (AM/LL/RR2) % P1105AM (AM/LL/RR2) % P1197AM (AM/LL/RR2) % 1.1 mm Acres Northern Illinois Yld. Adv. / % Wins P0419AMX (AMX/LL/RR2) % P0496AMX (AMX/LL/RR2) % P0636AMX (AMX/LL/RR2) % P1142AMX (AMX/LL/RR2) % P1197CHR (RW/HX1/LL/RR2) % 2.6 mm Acres 1.1 mm Acres North Mississippi Delta Yld. Adv. / % Wins P1257YHR (YGCB/HX1/LL/RR2) % P1319HR (HX1/LL/RR2) % P1602YHR (YGCB/HX1/LL/RR2) % P1637YHR (YGCB/HX1/LL/RR2) % P1794VYHR (AVBL/YGCB/HX1/LL/RR2) % Source: 2014 Pioneer on-farm trial database as of October 28, Customer comparisons based on 2014 yield results including data from weigh wagon and PKP trials for all Pioneer brand hybrids against all competitors. Pioneer area leader package consists of a representative selection of the higher volume hybrids estimated for Individual results may vary. All data weighted by comparisons within 4CRM and adjusted to 15% moisture. Product performance is variable and subject to any number of environmental, disease and pest pressures 24

25 2014 Area Top Volume Leaders Package vs. All Competitors (Soybeans) NW MN, NE SD Yld. Adv. / % Wins P03T68R % P05T24R % P07T50R % 4.7 mm Acres NW Illinois Yld. Adv. / % Wins P24T05R % P25T51R % P32T25R % 1.2 mm Acres NE Nebraska Yld. Adv. / % Wins 92Y % P31T11R % P33T72R % 1.6 mm Acres 2.6 mm Acres NW Ohio Yld. Adv. / % Wins 931T11R % P32T28R % P33T72R % S Central Iowa Yld. Adv. / % Wins P25T51R % P28T33R % P35T58R % 1.9 mm Acres Louisiana Yld. Adv. / % Wins P47T36R % P47T89R % P50T64R % 2.7 mm Acres Source: 2014 Pioneer on-farm trial database as of October 28, Customer comparisons based on 2014 yield results including data from weigh wagon and PKP trials compared against all competitors in the area indicated. Individual results may vary. Pioneer area leader package consists of a representative selection of the higher volume varieties estimated for All data weighted by comparison within 3RM. All soybean products listed contain the Roundup Ready trait. Product performance is variable and subject to any number of environmental, disease and pest pressures. 25

26 Copyright 2014 DuPont or its affiliates. All rights reserved. The DuPont Oval Logo, DuPont, The miracles of science and, unless otherwise noted, all products denoted with or are registered trademarks or trademarks of E. I. du Pont de Nemours and Company or its affiliates. Images reproduced by E. I. du Pont de Nemours and Company under license from the National Geographic Society. 26

27 ^ ^ Agrisure Viptera is a registered trademark of, and used under license from, a Syngenta Group Company. Agrisure technology incorporated into these seeds is commercialized under a license from Syngenta Crop Protection AG. Herculex Insect Protection technology by Dow AgroSciences and Pioneer Hi-Bred. Herculex and the HX logo are registered trademarks of Dow AgroSciences LLC. Liberty, LibertyLink and the Water Droplet Design are trademarks of Bayer. YieldGard, the YieldGard Corn Borer design, Genuity, Roundup, Roundup Ready and Roundup Ready 2 Yield are registered trademarks of Monsanto Technology LLC used under license. Individual results may vary, and performance may vary from location to location and from year to year. This result may not be an indicator of results you may obtain as local growing, soil and weather conditions may vary. Growers should evaluate data from multiple locations and years whenever possible. Products, benefits and concepts described herein will not be offered for sale or distribution until completion of field testing and applicable regulatory reviews. Pioneer brand hybrids with event DP 4114 will not be offered for sale or distribution until completion of field testing and applicable regulatory reviews. Pioneer brand canola hybrids with glyphosate resistance will not be offered for sale or distribution until completion of field testing and applicable regulatory reviews. ^ EXPORT APPROVAL NOTICE: This product is fully approved in the United States and Canada. Traits included in these products may or may not be approved in all global markets; therefore, the combination of these traits and the grain and certain by-products (including oil, dried distillers grain, cobs, and husks) from THESE PRODUCTS MAY NOT BE APPROVED for all markets. Growers that use this product are required and agree to adhere to the stewardship requirements as outlined in the Pioneer Product Use Guide and product-specific Stewardship Requirements for this product, which include specific grain disposition requirements. For questions regarding product stewardship and biotech traits please contact your sales representative or refer to Growers are required to discuss trait acceptance and grain channeling policies with their local grain handler prior to delivering grain containing biotech traits. Always read and follow all precautions and directions provided in product labeling before making in-crop or other applications of any agricultural herbicides or using any other pesticide. Pioneer is a member of Excellence Through Stewardship (ETS). Pioneer is a member of Excellence Through Stewardship (ETS). Pioneer products are commercialized in accordance with ETS Product Launch Stewardship Guidance and in compliance with the Pioneer policies regarding stewardship of those products. Crops and materials containing biotech traits may only be exported to or used, processed, or sold in jurisdictions where all necessary regulatory approvals have been granted for those crops and materials. It is a violation of national and international laws to move materials containing biotech traits across borders into jurisdictions where their import is not permitted. Growers should discuss these issues with their purchaser or grain handler to confirm the purchaser or handler's position on products being purchased. Excellence Through Stewardship is a registered trademark of the Biotechnology Industry Organization. The DuPont Oval Logo is a registered trademark of DuPont., SM, TM Trademarks and service marks of Pioneer PHII. 27