About Dow Corning

Midland, Mich. - Dow Corning Corp. today announced sales of $3.25 billion and net income of $370 million in the first half of 2011.  Sales increased 12 percent as global demand continued to grow for the silicon-based innovator and manufacturer.  Additional information about Dow Corning’s financial results:

Second Quarter Results

• Sales were $1.67 billion, 8 percent higher than last year.
• Net income was $191 million, 14 percent lower than last year.
• Significant demand growth continued in Asia, Latin America, Eastern Europe and in developing geographic regions.
• Sharp increases in prices for materials and energy, as well as higher levels of operating expenses, negatively impacted net income growth.
• External factors including slowing global economies, Japan’s tsunami and earthquake, and unrest in the Middle East depressed net income results.

Year-to-Date Results

• Sales were $3.25 billion, 12 percent higher than last year.
• Net income was $370 million, 16 percent lower than last year.
• Adjusted net income was $363 million, 6 percent lower than last year, which excluded the U.S. Advanced Energy Manufacturing Tax Credits received by Dow Corning and its joint ventures in 2010.  

			Q2 2011		Q2 2010		% Change		2011		2010		% Change
	Sales (in billions)		$ 1.67		$1.54		8%		$3.25		$2.90		12 %
	Net Income (in millions)		$191		$221		-14%		$370		$439		-16%
	Adjust		$188		$215		-13%		$363		$388		-6%

	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 release.

 

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

• “While demand remains solid for Dow Corning’s silicon-based materials, we’ve seen pressure on our profits in the first half of 2011 from sharply rising raw materials and energy prices.  We’re countering these challenges by focusing on the efficiency of our business and by continuing to invest in innovation to serve high-value growth opportunities.”
• “Dow Corning’s silicones segment continues to see significant growth in emerging economies throughout Asia, Latin America and Eastern Europe, despite the global economic volatility that has challenged all businesses in 2011.” 
• “Dow Corning’s polycrystalline silicon segment through our Hemlock Semiconductor Group joint ventures continues to sell all of its production, and remains sold out for the foreseeable future.  While there has been some softening in the solar industry in 2011, we believe the solar industry will continue to grow at a rapid pace over the long-term as regions seek clean, renewable, domestically-generated sources of energy.” 
• “The pace of the global economic recovery remains slow due to uncertainty in the current business environment.  Political instability throughout the globe, as well as the tragedy of the earthquake and tsunami in Japan earlier this year, added to the challenges businesses like Dow Corning faced in the first half of the year.”

View Q2 2011 Condensed Consolidated Statements of Operations (PDF size = 12.2 KB)

About Dow Corning

Dow Corning (www.dowcorning.com) 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.