24 October 2012 19:38 [Source: ICIS news]
HOUSTON (ICIS)--US-based Dow Chemical achieved volume gains across all regions and in all but one of its business segments in the third quarter, despite reporting year-on-year declines in net income and sales, an analyst said on Wednesday.
As a result of higher volumes, Dow Chemical’s operating profitability improved and the company, with recurring third-quarter earnings per share of 42 cents, beat analysts’ estimates of 37 cents, Hassan Ahmed, head of research at New York-based firm Alembic Global Advisors, said in a note to clients.
Ahmed noted in particular volumes gains in Dow's performance plastics and performance materials segments – up 5% and 4% year on year, respectively.
“Third-quarter 2012 earnings clearly highlight that Dow operated its facilities very efficiently in the quarter,” the analyst added.
Ahmed said that Dow’s 35% year-on-year decline in third-quarter net income – to $582m (€448m) - was due to higher taxes, higher selling, general and administration (SG&A) expenses and higher research and development (R&D) expenses.
Adjusting for those items, Dow's third-quarter net income would have been $921m, compared with $903m in the 2011 third quarter, he said.
During Dow’s third-quarter results conference call, Dow executives said that the quarter’s 10% year-on-year decline in sales, to $13.6bn, was the result of price declines in all its geographic areas, led by Europe and China.
Dow’s shares price was up 5.3% to $30.05/share at 13:19 hours New York time (17:19 GMT) on the New York Stock Exchange.
($1 = €0.77)
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