Dow Chemical 2Q profit surges 73 percent
Thursday, July 28, 2011
MIDLAND, Mich. (AP) — Dow Chemical Co. said Wednesday that its second-quarter profit surged 73 percent on a combination of higher prices, increasing sales and comparison to results a year-ago weighed down by one-time charges.
The company also said it predicts continued growth in major markets like the U.S. and Europe, despite what it calls the “somewhat uneven and jagged pace” of economic recovery. The statement echoed similar outlooks this week by major companies including United Parcel Service Inc.
Dow Chemical is a bellwether of economic health because of its diverse array of customers, including manufacturers of toys, automobiles, farming equipment and LCD televisions.
Its latest results beat Wall Street estimates. But Dow shares slipped 86 cents to close at $34.99 Wednesday as the broader market pulled back.
The Midland, Mich., manufacturer said its net income in the April-to-June quarter rose to $982 million, or 84 cents per share. That’s up from $566 million, or 50 cents per share, a year ago.
Revenue rose 18 percent to $16.05 billion from $13.62 billion a year ago. Sales volume overall was up 9 percent from a year earlier and prices were 19 percent higher.
Analysts surveyed by FactSet Research predicted earnings of 79 cents a share on revenue of $14.75 billion.
Sales in its biggest segment, plastics, rose 9 percent to $3.27 billion. Sales of performance products rose 15 percent to $3.16 billion.
Dow Chemical has adopted a strategy of moving away from its basic plastics business and toward specialty materials acquired in the 2009 purchase of Rohm and Haas. Specialty materials are used in a range of products, including consumer electronics such as LCD televisions and smartphones and performance-related products.