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 MIDLAND, Mich., May 14 /PRNewswire/ -- Frank Popoff, president and

CEO of The Dow Chemical Company (NYSE: DOW), told stockholders today that the management of key issues is an essential part of enhancing Dow's long-term performance.
 Speaking at Dow's 95th annual meeting in Midland, Popoff discussed six issues that have captured the public's attention during this election year in the U.S. and around the world. The issues mentioned were the economy, global competition, trade agreements, environmental protection, health care and education.
 "These issues have been on our agenda for years," Popoff said. His review began "with the issue foremost on people's minds" during the recession and post recession recovery -- the economy.
 In discussing the economy, Popoff described how it affected Dow in 1991. "Its impact was significant and, despite the solid performance of Dow people around the world and a strong competitive showing, our financial results were disappointing," he said.
 After four years of record sales, Dow experienced a decline of 5 percent in 1991 from 1990. Sales were $18.8 billion, placing Dow 20th in sales in the Fortune 500 listing of U.S. industrial companies.
 Operating income fell 40 percent to $1.7 billion. Net income available for common stockholders was $935 million, down 32 percent from 1990 after a pretax special charge of $370 million.
 "This charge reflects asset write-offs and write-downs that followed our decision to permanently shut down and divest of a variety of non- strategic facilities and business activities," Popoff said.
 In addition, net income was influenced positively by the non-taxable profit of $213 million on the initial public offering of stock in Destec Energy, Inc. The bottom line was earnings per share at $3.46, down from $5.10 in 1990.
 "Our most significant challenge in 1991 was pricing," Popoff said. The volume of products sold was down only 1 percent compared to 1990, but Dow had a 4 percent decline in prices.
 "The good news is that current prices, after declining 11 percent from the first quarter of 1991, have become relatively stable, indicating we have likely reached the bottom of the economic cycle and could begin to see positive prior year comparisons as early as the second half of this year," he added.
 Popoff said the economy holds center stage this year in elections around the world, but at its core is the question of national competitiveness.
 "We are an exception to those U.S. companies that have lost ground to global competitors and whose jobs are being threatened by their inability to compete," he said. "We are truly a global company and our success depends on consumers around the world."
 Regarding the influence of trade agreements on global competition, Popoff said Dow favors free and fair trade. "Protectionism must be a thing of the past because efforts to liberalize trade policy directly benefit the chemical industry, the consumer and the economy as a whole," he said.
 Dow's investments made years ago to protect the environment were described as paying off today. "For example, amendments to the Clean Air Act feature much tougher standards, but we're in a position to meet the challenge of change far better than our competitors," Popoff said.
 The company will continue to have excellent health care programs, Popoff said. However, since 1987, Dow U.S.A. health care costs have increased 52 percent from $1,930 per insured employee or retiree to $2,932 in 1991.
 "For Dow to remain competitive in the global marketplace, these costs require the best of management," Popoff said. "We are approaching the problem from every angle, including changing the medical benefits for active, full-time, salaried employees and future retirees but not for current retirees."
 Dow is also concerned with signs of decline in technical and scientific education, Popoff said. "I believe this is the single most critical issue for the nation because education is at the very foundation of today's social and economic challenges."
 Dow's financial performance should improve sometime during the second half of the year, Popoff said. "But, conservatively, we're taking prudent actions like addressing costs and continuing to work on our quality process," he added.
 -0- 5/14/92
 /CONTACT: Douglas G. Draper of The Dow Chemical Company, 517-636-2876/
 (DOW) CO: The Dow Chemical Company ST: Michigan IN: CHM SU: ECO

JG -- DE029 -- 0358 05/14/92 15:28 EDT
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Publication:PR Newswire
Date:May 14, 1992

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