10-QPeriod: Q3 FY2024

DOW INC. Quarterly Report for Q3 Ended Sep 30, 2024

Filed October 25, 2024For Securities:DOW

Summary

Dow Inc. reported third-quarter 2024 net sales of $10.9 billion, a slight increase of 1% year-over-year, driven by a 1% increase in volume, while prices remained flat. For the nine-month period, net sales were $32.6 billion, down 4% compared to the prior year, reflecting a 5% decrease in pricing offset by a 1% increase in volume. The company experienced a notable increase in net income available for common stockholders to $1,169 million for the nine months ended September 30, 2024, compared to $694 million in the same period of 2023, translating to diluted earnings per share of $1.65 versus $0.97. This improvement in profitability is a key takeaway for investors, indicating a recovery in earnings power. Operationally, the company saw mixed results across its segments. Packaging & Specialty Plastics reported increased Operating EBIT due to lower raw material costs and higher selling prices. In contrast, Industrial Intermediates & Infrastructure experienced a decline in Operating EBIT, impacted by planned maintenance and lower integrated margins. Performance Materials & Coatings saw a decrease in Operating EBIT, primarily due to higher raw material costs, despite improved demand. The company also completed a strategic acquisition of Circulus Holdings, a plastic recycler, for approximately $130 million, aligning with its sustainability goals.

Financial Highlights

50 data points
Beta

Revenue

$10.88B

9.8% Gross Margin

Net Income

$211.00M

1.9% Net Margin

EPS (Diluted)

$0.30

Total Assets

$59.39B

Cash & Equivalents

$2.88B

Free Cash Flow

$800.00M

Financial Statements
Beta
Revenue$10.88B
Cost of Revenue$9.81B
Gross Profit$1.07B
SG&A Expenses$396.00M
Interest Expense$199.00M
Net Income$211.00M
EPS (Basic)$0.30
EPS (Diluted)$0.30
Shares Outstanding (Basic)702.30M
Shares Outstanding (Diluted)703.60M

Key Highlights

  • 1Net sales for the third quarter of 2024 increased by 1% to $10.9 billion compared to the prior year, driven by a 1% volume increase while prices remained flat.
  • 2Nine-month net sales decreased by 4% to $32.6 billion, impacted by a 5% decline in pricing, though volume grew by 1%.
  • 3Net income available for common stockholders significantly increased for the nine months ended September 30, 2024, reaching $1,169 million, up from $694 million in the prior year, with diluted EPS rising to $1.65 from $0.97.
  • 4The company acquired Circulus Holdings, a plastic recycler, for approximately $130 million, enhancing its capabilities in circular economy solutions.
  • 5Operating EBIT for Packaging & Specialty Plastics increased in the third quarter due to favorable raw material costs and selling prices.
  • 6Despite overall profit improvement, Industrial Intermediates & Infrastructure and Performance Materials & Coatings segments faced challenges with declining Operating EBIT, primarily due to maintenance costs and raw material price increases, respectively.
  • 7Dow maintained a strong liquidity position with $8.4 billion in committed and available credit facilities and $2.88 billion in cash and cash equivalents at the end of the quarter.

Frequently Asked Questions

In the third quarter of 2024, Dow Inc. reported net sales of $10.9 billion, a 1% increase year-over-year, with volume up 1% and prices flat. For the first nine months of 2024, net sales were $32.6 billion, down 4% from the prior year, driven by a 5% price decrease offset by a 1% volume increase. Notably, net income available for common stockholders improved significantly, reaching $1,169 million for the nine-month period, compared to $694 million in 2023, with diluted EPS rising to $1.65 from $0.97.

Packaging & Specialty Plastics saw a 1% increase in net sales and improved Operating EBIT due to lower raw material costs and higher selling prices. Industrial Intermediates & Infrastructure's net sales decreased by 2%, and it reported a loss in Operating EBIT due to higher planned maintenance and lower integrated margins. Performance Materials & Coatings' net sales rose by 4%, but Operating EBIT decreased due to higher raw material costs, despite improved demand.

Dow acquired Circulus Holdings, a U.S. mechanical recycling company, for approximately $130 million. This acquisition aligns with Dow's strategy to increase its capacity in circular and renewable solutions and transform plastic waste. Additionally, the company is undertaking a strategic review of select assets in Europe, primarily polyurethanes assets, as part of optimizing its global footprint.

Dow anticipates continued operational discipline and aims to capitalize on demand strengths, leveraging its global scale. The company maintains a strong financial position with $8.4 billion in committed and available credit facilities and $2.88 billion in cash and cash equivalents as of September 30, 2024. No substantial long-term debt maturities are expected until 2027, providing significant financial flexibility.