DuPont de Nemours Inc

The revenues and certain expenses of the Delrin® Divestiture are classified as discontinued operations for the three months ended March 31, 2023. In addition, the Auto Adhesives & Fluids, MultibaseTM and Tedlar® product lines within the historical Mobility & Materials segment (the "Retained Businesses") were not included in the scope of the M&M Divestitures and are included in Corporate & Other.

Historical Delrin® costs that were classified as discontinued operation in prior years included only direct operating expenses incurred by Delrin® prior to the November 1, 2023 divestiture. Indirect costs, such as those related to corporate and shared service functions previously allocated to the Delrin® Business, did not meet the criteria for discontinued operations and were reported within continuing operations in the respective prior years. A portion of these historical indirect costs included costs related to activities the Company is undertaking on behalf of Delrin®, and for which it is reimbursed (“Future Reimbursable Indirect Costs”). Future Reimbursable Indirect Costs are reported within continuing operations but are excluded from operating EBITDA as defined below. The remaining portion of these indirect costs are not subject to reimbursement (“Stranded Costs”). Stranded Costs are reported within continuing operations in Corporate & Other and are included within Operating EBITDA.

On August 1, 2023, the Company completed the previously announced acquisition of Spectrum Plastics Group (“Spectrum”) from AEA Investors (the “Spectrum Acquisition”). Spectrum is part of the Electronics & Industrial segment.

The Company's measure of profit/loss for segment reporting purposes is Operating EBITDA as this is the manner in which the Company's chief operating decision maker ("CODM") assesses performance and allocates resources. The Company defines Operating EBITDA as earnings (i.e., “Income from continuing operations before income taxes") before interest, depreciation, amortization, non-operating pension / other post-employment benefits (“OPEB”) / charges, and foreign exchange gains / losses, excluding Future Reimbursable Indirect Costs, and adjusted for significant items.

ELECTRONICS & INDUSTRIAL

The Electronics & Industrial segment is a leading global supplier of differentiated materials and systems for a broad range of consumer electronics including mobile devices, television monitors, personal computers and electronics used in a variety of industries. The segment is a leading provider of materials and solutions for the fabrication and packaging of semiconductors and integrated circuits and provides innovative solutions for thermal management and electromagnetic shielding as well as metallization processes for metal finishing, decorative, and industrial applications. Electronics & Industrial is a leading provider of platemaking systems and photopolymer plates for the packaging graphics industry, digital printing inks and cutting-edge materials for the manufacturing of displays for organic light emitting diode ("OLED"). In addition, the segment produces innovative engineering polymer solutions, high performance parts, flexible packaging products, plastic and silicone extrusions, medical silicones, specialty lubricants and critical polymer-based components and devices for medical and other industrial markets.

Electronics & Industrial net sales were $1,365 million for the three months ended March 31, 2024, up 5 percent from $1,296 million for the three months ended March 31, 2023. Net sales increased due to a 8 percent increase in portfolio actions, partially offset by 1 percent decreases in local price and product mix, sales volume and unfavorable currency impacts. The portfolio impact reflects the August 2023 acquisition of Spectrum. Volume declines in Industrial Solutions were related to ongoing channel inventory destocking primarily for Kalrez®parts and within biopharma markets. Within Semiconductor Technologies, volume gains were driven by the start of semiconductor demand recovery and the normalization of customer inventory levels along with increased demand for OLED materials. Volume gains in Interconnect Solutions were driven by increased demand and inventory channel stabilization within Laminates and Metallization & Imaging. These volume gains were mostly offset by local price and product mix declines in Interconnect Solutions, including the impact of lower pass-through metals. The unfavorable currency impact is primarily driven by the Japanese yen and Chinese yuan.

Operating EBITDA was $374 million for the three months ended March 31, 2024, up 3 percent compared with $362 million for the three months ended March 31, 2023, primarily due to the earnings contribution from the Spectrum acquisition and strength in Semiconductor Technologies and Interconnect Solutions partially offset by lower volumes within Industrial Solutions.

WATER & PROTECTION

The Water & Protection segment is a leading provider of engineered products and integrated systems for a number of industries including worker safety, water purification and separation, aerospace, energy, medical packaging and building materials. The segment satisfies the growing global needs of businesses, governments, and consumers for solutions that make life safer, healthier, and better. By uniting market-driven science with the strength of highly regarded brands, the segment strives to bring new products and solutions to solve customers' needs faster, better and more cost effectively.

Water & Protection net sales were $1,291 million for the three months ended March 31, 2024, down 11 percent from $1,449 million for the three months ended March 31, 2023. The net sales decreased due to a 10 percent decline in volume and a 1 percent unfavorable currency impact. Volume declines within Safety Solutions were mainly due to channel inventory destocking, primarily in medical packaging products within healthcare markets. Water Solutions volume declines were primarily due to distributor inventory destocking and weaker industrial demand in China. Shelter Solutions was relatively flat. The unfavorable currency impact is primarily driven by the Chinese yuan and Japanese yen partially offset by the European euro.

Operating EBITDA was $295 million for the three months ended March 31, 2024, down 14 percent compared with $344 million for the three months ended March 31, 2023, driven by decreased sales volumes partially offset by lower product costs.

CORPORATE AND OTHER

Corporate & Other includes sales and activity of the Retained Businesses including the Auto Adhesives & Fluids, Multibase TM and Tedlar® product lines. Related to the Delrin® Divestiture, Corporate & Other includes DuPont's equity interest in Derby Holdings Group, Stranded Costs and Future Reimbursable Indirect Costs. Corporate & Other also includes certain enterprise and governance activities including non-allocated corporate overhead costs and support functions, leveraged services, non-business aligned litigation expenses and other costs not absorbed by reportable segments.