Dow CEO predicts better prospects in 2010

Dow Chemical Co. reported a fall in Q4 sales in North America and Europe as growth in those regions may be eroded by high unemployment. North American revenue tumbled 19% to US$4.12 bln as volumes fell 11% and European sales dropped 3.7% to US$4.12 bln. Combined sales Dow Chemical Co’s two plastics-related business units : Basic Plastics and Performance Products, fell by 30% in 2009 to about US$19 bln, with a steady combined operating profit at around US$2.8 bln. Overall sales were down 22% to US$44.9 bln, although the firm’s full-year profit grew 3% to US$676 mln. After a challenging 2009, Dow anticipates a healthier 2010. Plastics-related businesses accounted for about 40% of Dow’s segment sales in 2009, equally divided between Basic Plastics (polyethylene, polypropylene, styrenics and polycarbonate) and Performance Products (polyurethane, epoxy and other specialty materials). In 2010, Dow will continue to look for partners for its commodity plastics units and for a buyer for its Styron styrenics business. Dow is in talks with three strategic partners in a JV construct. The company reduced workforce, shut plants and sold assets last year to buoy earnings and pay off a loan used to buy Rohm & Haas Co. during the recession. The following are the company’s accomplishments in 2009: * Reducing overall debt by US$2.5 bln since April 1. * Selling off US$3 bln of non-core assets, including the Morton Salt unit of Rohm and Haas. * Meeting 70% of its two-year target of US$2.5 bln in Rohm and Haas-related savings. * Paying off an acquisition-related bridge loan ahead of time. * Establishing a Dow-record US$1.6 bln research and development budget for 2010.
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