Dow Reports Second Quarter Results

The Dow Chemical Company (NYSE: DOW):

Second Quarter 2014 Highlights
  • The Company reported earnings of $0.73 per share, or $0.74 per share on an adjusted basis (1). This compares with earnings of $1.87 per share versus the year-ago period, or adjusted earnings of $0.64 per share – representing an increase of 16 percent year over year. Results in the same quarter last year reflect the receipt of the K-Dow arbitration resolution.
  • Sales were $14.9 billion, up 2 percent versus the year-ago period, or 3 percent on an adjusted basis (2). Gains were reported in all operating segments, led by Performance Plastics (up 4 percent) and Electronic and Functional Materials (up 5 percent). Agricultural Sciences also increased sales, rising 3 percent in the quarter and achieving a first-half sales record of $4 billion.
  • The Company reported adjusted sales gains in most geographic areas, with increases reported both in developed regions (up 3 percent) and in emerging regions (up 2 percent). Gains were led by Western Europe (up 6 percent) and the United States (up 5 percent).
  • EBITDA (3) was $2.2 billion, up 5 percent on an adjusted basis (4) versus the year-ago period. EBITDA rose in most operating segments, led by Performance Materials (up 36 percent), as a result of ongoing productivity actions, as well as improved pricing and demand. Performance Plastics and Electronic and Functional Materials also drove EBITDA gains, up 6 percent and 19 percent respectively.
  • Adjusted EBITDA margin (5) expanded more than 40 basis points to 15 percent year over year, as productivity and growth actions more than offset the impact of a greater than $350 million increase in purchased feedstock and energy costs, coupled with a $100 million impact from unplanned outages at Dow’s ethylene facilities in Plaquemine, Louisiana.
  • Cash flow from operations was $1.4 billion for the quarter. Year-to-date, Dow has returned $3 billion to shareholders through declared dividends and share repurchases.

Comment

Andrew N. Liveris, Dow’s chairman and chief executive officer, stated:

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