Dow Inc (DOW, Financial), a diversified global chemicals producer, reported its second-quarter 2024 earnings, revealing mixed results compared to analyst expectations. The company, formed in 2019 from the DowDuPont merger, is a leading producer of chemicals such as polyethylene, ethylene oxide, and silicone rubber, with applications across various consumer and industrial markets.
Performance Overview
For Q2 2024, Dow Inc (DOW, Financial) reported GAAP earnings per share (EPS) of $0.62 and operating EPS of $0.68, falling short of the analyst estimate of $0.69. Net sales for the quarter were $10.9 billion, slightly below the estimated $11.007 billion and down 4% year-over-year. Despite these declines, the company saw a 1% sequential increase in sales, driven by gains in Performance Materials & Coatings and Packaging & Specialty Plastics.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 | Q1 2024 |
|---|---|---|---|
| Net Sales | $10,915 million | $11,420 million | $10,765 million |
| GAAP Net Income | $458 million | $501 million | $538 million |
| Operating EBIT | $819 million | $885 million | $674 million |
| Operating EBITDA | $1,501 million | $1,534 million | $1,394 million |
| Cash Provided by Operating Activities | $832 million | $1,347 million | $460 million |
Segment Performance
Packaging & Specialty Plastics: This segment reported net sales of $5.5 billion, down 7% year-over-year. Operating EBIT was $703 million, a decrease of $215 million from the previous year, primarily due to lower integrated margins and higher planned maintenance activity.
Industrial Intermediates & Infrastructure: Net sales for this segment were $3 billion, down 7% year-over-year. Operating EBIT improved to $7 million, up $42 million from the previous year, driven by improved equity earnings.
Performance Materials & Coatings: This segment saw a 2% increase in net sales to $2.2 billion. Operating EBIT was $146 million, an improvement of $80 million year-over-year, driven by broad-based business and geographic volume growth.
Financial Achievements and Challenges
Dow Inc (DOW, Financial) achieved several financial milestones, including a sequential increase in operating EBIT by $145 million and a strong cash flow from operations of $832 million. However, the company faced challenges such as lower integrated margins and higher planned maintenance activity, which impacted overall profitability.
“In the second quarter, Team Dow delivered sequential earnings improvement and our third consecutive quarter of year-over-year volume growth,” said Jim Fitterling, chair and chief executive officer. “The pace of the global macroeconomic recovery has been slower than expected. We remain focused on working capital, reducing costs, and matching our operating rates to current demand.”
Income Statement Highlights
Dow Inc (DOW, Financial) reported a GAAP net income of $458 million for Q2 2024, down from $501 million in Q2 2023. The company's operating EBIT was $819 million, a decrease of $66 million year-over-year. Despite these declines, the company saw improvements in equity earnings, particularly from its joint ventures in Kuwait and Sadara.
Balance Sheet and Cash Flow
Cash provided by operating activities was $832 million, down $515 million year-over-year but up $372 million sequentially. The company returned $691 million to shareholders through dividends and share repurchases during the quarter.
Outlook
Looking ahead, Dow Inc (DOW, Financial) aims to continue delivering sequential earnings improvements while navigating a slower macroeconomic environment. The company plans to leverage its global scale, cost advantages, and innovation portfolio to drive higher sales and shareholder returns.
For more detailed information, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from Dow Inc for further details.
