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DuPont (DD) Plans to Express EPS on 'Operating' Basis in FY13

December 13, 2012 4:12 PM EST
DuPont (NYSE: DD) announced the introduction of operating earnings as the basis for reporting results to provide more transparency to the company's operational results and pension costs. The company defines operating earnings (non-GAAP) as earnings from continuing operations (GAAP) excluding significant items and non-operating pension and other postretirement employee benefit (OPEB) costs, which are impacted by changes in interest rates and plan returns. The pension/OPEB service cost component is included in operating earnings as this reflects the ongoing costs of providing postretirement benefits to the company's eligible employees.

"We believe this reporting change provides investors with better transparency to operational results by reducing volatility in earnings due to non-operational factors, such as fluctuations in discount rates and return on plan assets," said DuPont Executive Vice President and CFO Nicholas C. Fanandakis. "This change, which is better aligned with management's decision-making process, also allows for better comparison of each business's operating results to their peer companies' operating results that have different benefit structures."

DuPont will begin reporting operating earnings in 2013. For the nine-month period ended Sept. 30, 2012, non-operating pension/OPEB costs were approximately $.36 per share on a continuing operations basis.


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