DuPont Earnings Call Insights: TiO2 Outlook, Share Buyback Potential
Don Carson – Susquehanna Financial: Ellen, I wanted to get a little more color on your TiO2 outlook, specifically what – I know you gave segment price volume data but what are you seeing on pricing and volumes. How steep is the downward trajectory this quarter and how do you see the business unfolding next year?
Ellen J. Kullman – Chair of the Board and CEO: Yeah. So, certainly we are in the midst of changing market condition over this past quarter. Coming through second quarter, we saw improvement in that market and with kind of a step down in Asia Pacific in economic activity and infrastructure investment in China, we saw volumes fall there. You saw the volume decrease obviously in the quarter and expect volume and price pressure to continue in the fourth quarter. Sizing that, we’ve done that in terms of putting forward our guidance for the year end estimate and the range that you’ve seen there is inclusive of what is a substantial decline in Performance Chemicals earnings along with the seasonal losses in Agriculture. As we look out next year Don, we do see that there is some things moving in the favor of stabilizing forces around TiO2. If you take a look at how is the market improving from 21% year-over-year and the season that will come in the U.S. in the second quarter and China which is expected to resume some infrastructure investment as their change in government takes place. Customer inventory levels are normalizing and so it’s going to be a tough end to the year but we see stabilization occurring in the first half of next year and as the macroeconomic picture plays out we can get more specific on that.
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Share Buyback Potential
David Begleiter – Deutsche Bank: Ellen, could you talk about user proceeds from coatings and potential for share buybacks given your current share price?
Ellen J. Kullman – Chair of the Board and CEO: Well, Nick, why don’t you start on that one for Dave?
Nicholas C. Fanandakis – EVP and CFO: When you think about the proceeds, I talked to you today about what the dollar value is now, size to be on an after tax basis and as I mentioned, we need to finalize that as the sale actually closes. But I think a good basis to be thinking about right now is around that $4 billion number after-tax proceeds. The first thing we’re going to do is as I mentioned we want to make sure we maintain that strong balance sheet the AA2 rating is very important to us. So, strengthening that balance sheet is one of the key criteria and one of the first things we’re going to be looking to do there. Subsequent to that what we’re going to be doing is looking at returning excess cash to our shareholders as we always talk about doing, unless we have a compelling investment opportunity. That investment opportunity could be capacity increases, could be opportunities around further investments in some of the R&D work, it could be potential acquisition. So, there’s a lot of ways in which that could manifest itself. The other thing is obviously when you think about returning value to the shareholders, the fact that we’ve had 432 consecutive dividends displays our commitment to the dividend program and ultimately Board decision there as to dividend. In share buyback you mentioned, we have active share buyback programs in place, David and we continue to operate against those primary purpose there is to make sure that we don’t have dilution in the earnings from any of the management options that would be exercised over the course of the time.
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