MIDLAND — The Dow Chemical Co. (NYSE: DOW) reported first quarter net income of $1.39 billion or $1.18 a share, up from $964 million or 79 cents a share in the first quarter of 2014.
Strongest gains were reported in the company’s consumer solutions,
infrastructure solutions, performance materials and chemicals units,
as well as performance plastics.
The increase in net income despite a 14 percent decline in sales, to
$12.37 billion, from $14.46 billion a year ago. The company said that
decline was driven primarily by price declines, due to changes in
crude oil values and currency devaluations vs. the dollar.
Demand for Dow products grew across all geographic region.
Volume increased in Performance Plastics (up 6 percent), and
Performance Materials & Chemicals and Consumer Solutions (both
up 5 percent). Overall, growth was led by emerging geographies (up
5 percent), with particular strength in Greater China (up 10 percent).
Operating cash flow was $1.2 billion – a first quarter record and an
increase of more than $660 million vs. the same quarter last year.
“Dow delivered a 10th consecutive quarter of operating earnings and margin growth with the full impact of an integrated, diversified portfolio on display,” said Dow chairman and CEO Andrew N. Liveris. “Demand for our high-margin, technology-driven businesses, coupled with our low-cost integration delivered margin expansion. This performance underscores the power of our portfolio to deliver in the face of significant macroeconomic pressures, with issues like oil price declines and currency volatility, plus weather impacts in agriculture, all overcome in the quarter. Our targeted market participation strategy, together with the strength of our integrated portfolio, has created a company with higher and even more predictable earnings.”
Research and development expenses and selling, general and
administrative expenses together decreased $35 million vs. the
year-ago period due primarily to targeted cost-savings initiatives,
coupled with impacts related to currency.
Operating cash flow was $1.2 billion – a first quarter record and an
increase of more than $660 million versus the same quarter last year.
Agricultural Sciences reported sales of $1.9 billion, down 12 percent
versus the year-ago period. Consumer Solutions reported first quarter sales of $1.1 billion. The segment achieved double-digit sales increases in North America, which were more than offset by lower sales in EMEAI and Asia Pacific. Dow Automotive Systems reported increased sales on continued growth of structural adhesives – with particular strength across North America and Asia Pacific. Infrastructure Solutions reported first quarter sales of $1.8 billion, with steady volume offset by lower pricing. In Energy & Water Solutions, double-digit demand increases in reverse osmosis technologies were more than offset by volume declines in Microbial Control. In Dow Building & Construction, increased sales in North America were more than offset by currency and volume declines in Europe, where colder weather impacted results. Performance Materials & Chemicals reported first quarter sales of $3.2 billion, down 8 percent (excluding divestitures) vs. the year-ago period. Volume increases in all geographic areas were more than offset by price and currency declines. Performance Plastics reported first quarter sales of $4.3 billion, down 23 percent versus the year-ago period, primarily due to declines in Hydrocarbons & Energy.
To listen to a replay of a management discussion of these results,
visit www.dow.com.
Sales in North America were $4.77 billion, down from $5.36 billion a
year earlier. Sales in Europe, the Middle East, Africa and India were
$3.97 billion, down from $5.22 billion a year earlier. Sales in Asia-
Pacific were $2.05 billion, down from $2.19 billion. And sales in Latin America were $1.58 billion, down from $1.7 billion.