Midland, Michigan - Dow Chemical Co.'s Performance Systems and Performance Products businesses, which house the company's PU activities, have reported sales down by 38 percent to $1500 million and down 41 percent to $2100 million respectively, in the second quarter of 2009, compared to the same period last year.
Polyurethane sales in the Performance Products unit were down due to lack of demand and poor industry supply and demand fundamentals, the 30 July statement said. Overall volume declined 22 percent and selling prices fell by 19 percent in the unit, although demand was up slightly against the first quarter of 2009 (Q1).
Volumes and selling prices in Performance Systems declined 26 percent and 12 percent respectively compared to Q2 2008, driven by the global economic slowdown in the automotive, construction, and housing industries, the company said. Polyurethane Systems posted volume declines, most significantly in Europe due to weakness in the housing and appliance industry, Dow added.
Compared to Q1 2009 however, Polyurethane Systems reported volume gains thanks to government spending on road and bridge repairs and for major projects using PU systems for oil pipe insulation applications in Asia, the company added.
Overall net sales for Dow Chemical were down 31 percent to $11 300 million compared to the same period last year and net income was down by $435 million compared to $776 million in Q2 2008.
"The economic outlook for the rest of 2009 appears to be stabilising, with strong growth in Asia Pacific, especially China, where domestic stimulus programme's have created demand," said Dow ceo, Andrew Liveris. "In our view, the United States economy has found bottom, but will be slow in recovering as unemployment continues to be a drag on consumer spending," he said, adding that Dow's 2009 operating plan does not count on material improvements in market conditions for the remainder of the year.
"Dow has already begun to benefit from the smooth integration of Rohm and Haas and the decisive actions we took to accelerate our restructuring efforts and cost synergies," Liveris added. (RD)
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