Updated version 2 - Dow Chemical’s profits surpass expectations, driven by rising polyethylene prices and cost reductions

The full text has been supplemented with share price data, details and charts.

Reuters, October 22 - Dow Chemical Company (Dow DOW.N) reported third-quarter adjusted profit above Wall Street expectations on Thursday, mainly due to an increase in polyethylene prices and cost-cutting measures that helped the chemical company offset rising material and logistics costs.

After the escalation of the Iran conflict in late February (link), the blockade of the Strait of Hormuz disrupted the shipping of oil and petrochemical products, leading to a tightening in global chemical supplies and driving a significant rise in the prices of plastics and polymers (link).

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Earlier this year, Dow announced plans to cut 13% of its workforce (link) to reduce costs. As part of broader efforts to boost profitability, the company has also been reviewing its global asset portfolio.

Chief Executive Officer Karen S. Carter said in a statement that through cost reduction and portfolio optimization initiatives, including the closure of high-cost upstream assets, Dow remains on track to achieve annual EBITDA growth of more than $1 billion in 2026 and 2027.

The company’s share price rose more than 1% in premarket trading.

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Driven by higher polyethylene and functional polymer prices in all regions, Dow’s Packaging & Specialty Plastics segment posted a third-quarter net sales increase of more than 18% from a year earlier to $5.8 billion.

Its Industrial Intermediates & Infrastructure segment reported net sales up 7.9% to $3.06 billion; while its Performance Materials & Coatings segment saw net sales grow by more than 8% from a year earlier to $2.25 billion.

According to data compiled by LSEG, the Michigan-based company reported quarterly adjusted earnings per share of 71 cents for the period ended September 30, versus analysts’ average estimate of 64 cents.

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