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DOW CHEMICAL'S SALES AND EARNINGS DOWN COMPARED TO STRONG FIRST QUARTER IN 1991

 DOW CHEMICAL'S SALES AND EARNINGS DOWN
 COMPARED TO STRONG FIRST QUARTER IN 1991
 MIDLAND, Mich., April 22 /PRNewswire/ -- The Dow Chemical Company (NYSE: DOW) had lower sales and earnings for the first quarter of 1992 compared to the same period in 1991 due to weaker business and economic conditions. In addition, results for the first quarter of 1991 were enhanced by a one-time gain on the initial public offering of stock in Destec Energy, Inc., and higher prices in anticipation of increased hydrocarbon costs related to the Gulf War.
 Sales for the first quarter of 1992 were $4.6 billion, down 6 percent vs. a year ago. Operating income was $531 million, down 32 percent from 1991, reflecting the effect of significantly lower prices in 1992. Earnings per share of 62 cents were down 54 percent from operating earnings of $1.34 a year ago. Including the non-taxable profit of 79 cents per share on the sale of Destec stock, Dow had total earnings per share of $2.13 in the first quarter of 1991.
 Dow's sales in the first quarter a year ago were the company's second highest. "Because of the rapid escalation of prices during the Gulf War, comparisons to that quarter are very difficult," said Frank Popoff, Dow president and CEO.
 Prices were down 11 percent or $588 million compared to the first quarter a year ago. "The good news is that pricing has become relatively stable over the last six months, feedstock costs have declined, and we have probably reached the bottom of the economic cycle in the U.S.," Popoff said.
 Chemicals and Performance Products sales declined 9 percent to $1.1 billion in the first quarter compared to a year ago and operating income was down 56 percent to $95 million. The decline was led by chlorinated solvents and softer demand for caustic soda while vinyl chloride showed signs of volume recovery. Other improvements included increased demand for latex and stronger results for Separation Systems.
 Sales for Plastics were $1.6 billion in the first quarter, which is a 10-percent decline vs. a year ago, and operating income declined 56 percent to $95 million. While sales for basic plastics are down compared to the first quarter of 1991, price initiatives are under way to improve margins. Fabricated Products gained from greater demand for construction materials and Thermosets benefited due to a strong quarter for the epoxy business.
 Hydrocarbons and Energy had $385 million in sales, which was 30 percent lower than a year ago, and an operating loss of $30 million vs. operating income of $24 million in 1991.
 Dow's consumer specialties continued to experience sales and operating income growth. Compared to a year ago, sales were up 9 percent at $1.5 billion and operating income was 17 percent higher at $342 million. Marion Merrell Dow reported a 21-percent increase in sales with $779 million for the quarter, reflecting the continued growth of established products, the benefit of international acquisitions and successful introductions of several products in 1991. DowElanco had $446 million in sales, down 6 percent from a year ago, reflecting a shift of some sales from the first to the second quarter. DowBrands' first-quarter sales of $231 million were 8 percent higher than in 1991 with plastic bags and wraps and household cleaning products providing growth momentum.
 "The Consumers Specialties segment continued its outstanding performance. In addition, the specialty subsegments of Thermosets, Fabricated Products and Performance Products posted a 17-percent improvement in operating income vs. a year ago. These results proved the value of our diversification efforts toward higher value-added products," Popoff said.
 "Although there are some encouraging signs of recovery from the recession in the U.S., the European economies have weakened and Pacific markets, particularly Japan, have moderated their growth," Popoff said. "While the chemical industry tends to lag any upward economic movement by as much as six months, we continue to be optimistic about having positive earnings momentum during the second half of 1992."
 THE DOW CHEMICAL COMPANY AND SUBSIDIARIES
 CONSOLIDATED STATEMENT OF INCOME
 (Unaudited; in millions, except for share amounts)
 Three Months Ended
 March 31
 1992 1991
 Net sales $4,639 $4,948
 Operating Costs and Expenses:
 Cost of sales 3,035 3,170
 Insurance and finance company
 operations, net (income) (21) (18)
 Research and development expenses 308 279
 Promotion and advertising expenses 192 158
 Selling and administrative expenses 558 540
 Amortization of intangibles 36 34
 Total operating costs and expenses 4,108 4,163
 Operating income 531 785
 Other Income (Expense):
 Equity in earnings of related companies 27 26
 Interest income 24 26
 Capitalized interest 19 26
 Interest expense (184) (184)
 Gain (loss) on foreign
 currency transactions (15) 23
 Gain on Destec Energy public stock offering --- 213
 Sundry income - net 8 21
 Total other income (expense) (121) 151
 Income before provision for taxes
 on income and minority interests 410 936
 Provision for taxes on income 160 289
 Minority interests' share in income 79 69
 Net income 171 578
 Preferred stock dividend 2 2
 Net income available for
 common stockholders $169 $576
 Average common shares outstanding 270.9 270.1
 Earnings per common share $0.62 $2.13
 Cash dividends declared per common share $0.65 $0.65
 Depreciation $322 $283
 Capital expenditures $285 $408
 -0- 4/22/92
 /CONTACT: Douglas G. Draper of The Dow Chemical Company, 517-636-2876/
 (DOW) CO: The Dow Chemical Company ST: Michigan IN: CHM SU: ERN


JG -- DE001 -- 1038 04/22/92 08:29 EDT
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