Dow Chemical Co. on Wednesday reported its best quarterly results in more than a year as it benefited from growing demand and price increases.
Net income rose to $466 million from just $24 million a year ago. The nation's largest chemical maker said the results show that demand is growing in developed markets, which were hit hardest by the recession. Strong growth in emerging markets continues to boost the manufacturing sector, Dow said.
Dow also said that consumer spending has strengthened in areas such as electronics, appliances and automotive, echoing comments made Tuesday by chemical maker DuPont, which also posted strong results.
"Overall the global economic environment is on a stronger footing and there are signs that this will continue for the foreseeable future," CEO Andrew Liveris said in a statement. "This is good news for Dow."
The company did not provide a specific earnings or sales forecast for the current quarter or full year.
On a per share basis, profit rose to 41 cents per share, after paying preferred dividends, from 3 cents per share, in the same quarter last year. Excluding certain items, Dow earned 43 cents per share.
The Midland, Mich. maker of components used in products such as paint, cosmetics and plastic bags says revenue rose 48 percent to $13.42 billion from $9.04 billion.
Wall Street expected earnings of 30 cents per share on $12.9 billion in revenue, according to a Thomson Reuters survey.
In recent weeks, there have been signs of strengthening in the U.S. economy. The Consumer Confidence Index rose in April to 57.9, according to The Conference Board, a private research group based in New York. That's up from a revised 52.3 in March.
The April reading is the highest since September 2008's 61.4, but below the 90 reading that is considered healthy.
Dow Chemical raised prices by 17 percent in the first quarter and logged a 16 percent increase in sales volumes as demand grew across all of its regions.
Revenue gains were led by higher sales in its basic plastics business, which posted a 49 percent sales increase. Performance products revenue climbed 41 percent.
Revenue in its electronic and specialty materials segment and its performance systems unit rose 30 percent, while revenue from its coatings and infrastructure business grew 21 percent.
The company's health and agricultural segment suffered a revenue decline due to an oversupply of glyphosate, which hurt demand for the herbicide.
Last year, Dow acquired Rohm & Haas for $16.5 billion to expand into the more profitable specialty chemicals business. The company said the acquisition and cost cuts allowed it to save $275 million in the period.
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