Chemical giant, The Dow Chemical Co. (DOW) delayed the restart of a cracker at its Terneuzen chemicals plant in the Netherlands that was scheduled to resume operations early this week. The decision follows the planned maintenance that began in March.
Cracker 1 along with other chemical processing units at the facility was shut in mid-March for the maintenance work. The cracker is one of the three on site units having a capacity to produce 580,000 tpa ethylene.
Recently, DOW reported its first quarter of 2011 results. Dow earned 82 cents per share outpacing the Zacks Consensus Estimate of 67 cents per share as well as last year’s 43 cents per share. However, including one-time charges, the company earned 54 cents per share compared with 41 cents per share in the year-ago quarter.
Quarterly revenues jumped 20% year over year to $14.7 billion and were above the Zacks Consensus Estimate of $13.8 billion. Volume (8%) and pricing (12%) gains across all business segments and geographical regions, particularly North America and Europe, yielded healthy revenue growth.
North American revenues grew 8.1% while that of Latin America shot up 13.7%. Demand increased by 12.9% in Europe, Middle East and Africa, and 4.9% in Asia Pacific. Latin American volumes were up 1%. Volume in Asia Pacific decreased 4% and in North America inched down 2%.
A stronger top-line growth resulted in an increase of over 34% in EBITDA (adjusted) to $2.4 billion. EBITDA margin was up 300 basis points year over year. Dow’s global operating rate was 83%, flat year over year but up 2% sequentially.
DOW faces stiff competition from EI DuPont de Nemours & Co. (DD).
Currently, DOW has a short-term (1 to 3 months) Zacks #1 Rank (Strong Buy) but a long- term Neutral recommendation.
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