Midland, Michigan — Petrochemicals giant, Dow Chemical, generated sales of $11bn in the second quarter of 2019. This is lower by 14% than the same period in 2018.
The fall happened because of lower polyethylene, siloxanes and isocyanates prices. Lower sales of hydrocarbon co-products also hit the numbers.
Operating EBIT across the business fell 35% and hit $1.06 bn 'margin compression in polyethylene, isocyanates and siloxanes, as well as lower equity earnings, more than offset volume gains in packaging applications of 2019,' said the company.
Polyurethanes & Construction Chemicals is part of the Industrial Intermediates & Infrastructure Group.
The company's industrial intermediates & infrastructure business had sales which subsided by 15.86% between the second quarter of 2018 and 2019. They reached $3.3 bn in the first half of 2019. This compares with $3.97 bn the first half 2018.
Dow said that although it sold higher volumes of isocyanates and systems; these were offset by declines in polyols and propylene oxide/propylene glycol
At the same time, operating EBIT in the division declined by 69.32%. It hit $154m the first half of 2019. This compares with $502m the 2018 period.
'In spite of challenging market conditions, our results reflect the benefits of Dow’s streamlined and more focused portfolio. In the quarter, we faced margin compression in our intermediate products in both our core business and equity earnings,' said Jim Flittering, CEO.
| Dow numbers Q2 2019 ( $ m) | |||
|---|---|---|---|
| Group | 2019 | 2018 | Change % |
| Sales | 11,014 | 12,851 | -14% |
| Operating EBIT | 1,059 | 1,639 | -35% |
| Margin % | 9.6 | 12.8 | |
| Industrial Intermediates & Infrastructure | |||
| Sales | 3342 | 3972 | -15.86 |
| Operating EBIT | 154 | 502 | -69.32 |
| Margin % | 4.6% | 12.6% | |
| Source: Dow | |||
