United states securities and exchange commission

Loss from Discontinued Operations, Net of Tax

Loss from discontinued operations, net of tax was $77 million in 2017 and is related to certain DuPont assets divested as a condition of the regulatory approval of the Merger. See Note 4 to the Consolidated Financial Statements for additional information.

Net Income Attributable to Noncontrolling Interests

Net income attributable to noncontrolling interests was $132 million in 2017, $86 million in 2016 and $98 million in 2015. Net income attributable to noncontrolling interests increased in 2017 compared with 2016, primarily due to higher earnings from Dow Corning's consolidated joint ventures and improved results from a cogeneration facility in Brazil. Net income attributable to noncontrolling interests decreased in 2016 compared with 2015, primarily due to losses incurred by a cogeneration facility in Brazil, which more than offset the addition of earnings from Dow Corning's consolidated joint ventures. In addition, 2015 was also impacted by noncontrolling interests' portion of the 2015 restructuring charge. See Notes  5 , 18 and 23 to the Consolidated Financial Statements for additional information.

Dow Cumulative Convertible Preferred Stock Dividends

On December 30, 2016, Dow converted all outstanding shares of its Cumulative Convertible Perpetual Preferred Stock, Series A ("Dow Preferred Stock") into shares of Dow's common stock. As a result of this conversion, no shares of Dow Preferred Stock are issued or outstanding. On January 6, 2017, Dow filed an amendment to its Restated Certificate of Incorporation by way of a certificate of elimination with the Secretary of State of Delaware eliminating this series of preferred stock. Dow Preferred Stock dividends of $340 million were recognized in 2016 and 2015. See Note 17 to the Consolidated Financial Statements for additional information.

Net Income Available for DowDuPont Inc. Common Stockholders

Net income available for common stockholders was $1,460 million ( $0.91 per share) in 2017, compared with $3,978 million ( $3.52  per share) in 2016 and $7,345 million ( $6.15  per share) in 2015. See Note 9 to the Consolidated Financial Statements for details on the Company's earnings per share calculations.

SUPPLEMENTAL UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

The following supplemental unaudited pro forma combined statements of income (the "unaudited pro forma income statements") for DowDuPont are presented to illustrate the estimated effects of the Merger, assuming that the Merger had been consummated on January 1, 2016. For the periods presented below, activity prior to August 31, 2017 (the “Merger Date”) was prepared on a pro forma basis (the “unaudited pro forma information”) and activity after the Merger Date was prepared on a combined basis under accounting principles generally accepted in the United States of America (“U.S. GAAP”). The unaudited pro forma information was prepared in accordance with Article 11 of Regulation S-X. Pro forma adjustments have been made for (1) the preliminary purchase accounting impact, (2) accounting policy alignment, (3) the elimination of the effect of events that are directly attributable to the Merger Agreement (e.g., one-time transaction costs), (4) the elimination of the impact of transactions between Dow and DuPont, and (5) the elimination of the effect of consummated divestitures agreed to with certain regulatory agencies as a condition of approval for the Merger. Events that are not expected to have a continuing impact on the combined results (e.g., inventory step up costs) are excluded from the unaudited pro forma information. The unaudited pro forma information for activity prior to the Merger date does not reflect restructuring or integration activities or other costs following the Merger that may be incurred to achieve cost or growth synergies of DowDuPont. The unaudited pro forma income statements provide shareholders with summary financial information and historical data that is on a basis consistent with how DowDuPont reports current financial information.

The Merger was accounted for under Accounting Standards Codification ("ASC") Topic 805, "Business Combinations" ("ASC 805"), under which Dow was designated as the accounting acquirer in the Merger for accounting purposes. Under ASC 805, Dow accounted for the transaction by using Dow historical financial information and accounting policies and adding the assets and liabilities of DuPont as of the Merger Date at their respective fair values. The assets and liabilities of DuPont were measured based on various preliminary estimates at the Merger Date using assumptions that DowDuPont believes are reasonable based on information that was currently available. The fair value estimates reflected in the unaudited pro forma information are based on those used in the Current Report on Form 8-K/A filed with the SEC on October 26, 2017, and subsequent measurement period adjustments are not reflected. DowDuPont intends to complete and finalize the allocation of consideration as soon as practicable within the measurement period in accordance with ASC 805, but no later than one year following the closing date of the Merger.
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Differences between these preliminary estimates and the final acquisition accounting may occur and these differences could have a material impact on the accompanying unaudited pro forma income statements and DowDuPont’s future results of operations.
The unaudited pro forma information was prepared in accordance with Article 11 of Regulation S-X which is a different basis than the unaudited pro forma information presented in Note 3 to the Consolidated Financial Statements, which was prepared in accordance with the requirements of ASC 805.
The unaudited pro forma income statements have been presented for informational purposes only and are not necessarily indicative of what DowDuPont’s results of operations actually would have been had the Merger been completed on January 1, 2016. In addition, the unaudited pro forma income statements do not purport to project the future operating results of the Company. The unaudited pro forma income statements were based on and should be read in conjunction with the separate historical financial statements and accompanying notes contained in each of the Dow and DuPont Annual Reports on Form 10-K for the applicable periods. See Notes 1 and 3 to the Consolidated Financial Statements for additional information.

Unaudited Pro Forma Combined Statements of Income	Year Ended
In millions, except per share amounts	Dec 31, 2017			Dec 31, 2016
Net sales	$	79,535		$	70,894
Cost of sales	60,960			51,996
Research and development expenses	3,157			3,061
Selling, general and administrative expenses	6,776			6,701
Amortization of intangibles	1,743			1,624
Restructuring, goodwill impairment and asset related charges - net	3,593			1,151
Integration and separation costs	1,499			476
Asbestos-related charge	—			1,113
Equity in earnings of nonconsolidated affiliates	804			516
Sundry income (expense) - net	955			1,903
Interest expense and amortization of debt discount	1,256			1,108
Income from continuing operations before income taxes	2,310			6,083
Provision (Credit) for income taxes on continuing operations	(602		)	288
Income from continuing operations, net of tax	2,912			5,795
Net income attributable to noncontrolling interests	159			108
Net income from continuing operations attributable to DowDuPont Inc.	2,753			5,687
Preferred stock dividends	—			340
Net income from continuing operations available for DowDuPont Inc. common stockholders	$	2,753		$	5,347
Per common share data:
Earnings per common share from continuing operations - basic	$	1.18		$	2.40
Earnings per common share from continuing operations - diluted	$	1.17		$	2.37
Weighted-average common shares outstanding - basic	2,323.9			2,221.3
Weighted-average common shares outstanding - diluted	2,346.1			2,242.1

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Unaudited Pro Forma Combined Statement of Income					Year Ended Dec 31, 2017
											Adjustments
In millions, except per share amounts					DWDP 1			Historical DuPont 2			Reclass 3			Divestitures 4			Pro Forma 5			Pro Forma
Net sales					$	62,484		$	18,349		$	84		$	(1,219	)	$	(163	)	$	79,535
Cost of sales					50,414			10,617			387			(523		)	65			60,960
Other operating charges					—			521			(521		)	—			—			—
Research and development expenses					2,110			1,159			(27		)	(104		)	19			3,157
Selling, general and administrative expenses					4,021			3,452			(583		)	(143		)	29			6,776
Other (loss) income, net					—			173			(173		)	—			—			—
Amortization of intangibles					1,013			—			139			—			591			1,743
Restructuring, goodwill impairment and asset related charges - net					3,280			323			—			—			(10		)	3,593
Integration and separation costs					1,101			—			605			(24		)	(183		)	1,499
Equity in earnings of nonconsolidated affiliates					764			—			55			—			(15		)	804
Sundry income (expense) - net					966			—			1			(12		)	—			955
Interest expense and amortization of debt discount					1,082			254			—			—			(80		)	1,256
Income from continuing operations before income taxes					1,193			2,196			(33		)	(437		)	(609		)	2,310
Provision (Credit) for income taxes on continuing operations					(476		)	228			(33		)	(88		)	(233		)	(602		)
Income from continuing operations, net of tax					1,669			1,968			—			(349		)	(376		)	2,912
Net income attributable to noncontrolling interests					132			20			—			—			7			159
Net income from continuing operations attributable to DowDuPont Inc.					1,537			1,948			—			(349		)	(383		)	2,753
Preferred stock dividends					—			7			—			—			(7		)	—
Net income from continuing operations available for DowDuPont Inc. common stockholders					$	1,537		$	1,941		$	—		$	(349	)	$	(376	)	$	2,753
Per common share data:
Earnings per common share from continuing operations - basic																				$	1.18
Earnings per common share from continuing operations - diluted																				$	1.17
Weighted-average common shares outstanding - basic																				2,323.9
Weighted-average common shares outstanding - diluted																				2,346.1
1.				See the U.S. GAAP consolidated statements of income.
2.			Reflects DuPont activity for the period from January 1, 2017 to August 31, 2017.
3.		Certain reclassifications were made to conform with the presentation used for DowDuPont.
4.	Includes the following divestitures agreed to with certain regulatory agencies as a condition of approval for the Merger: Dow’s EAA Business (for the period of January 1, 2017 through the September 1, 2017 divestiture); the DAS Divested Ag Business (for the period of January 1, 2017 through August 31, 2017); and DuPont’s cereal broadleaf herbicides and chewing insecticides portfolio as well as its crop protection research and development pipeline and organization (for the period of January 1, 2017 through August 31, 2017; activity from September 1, 2017 through the November 1, 2017 divestiture was treated as discontinued operations).
5.	Certain pro forma adjustments were made to illustrate the estimated effects of the Merger, assuming that the Merger had been consummated on January 1, 2016. Refer to Summary of Pro Forma Adjustments at the end of this section for additional details.