Dow Inc. (NYSE:DOW) reported first-quarter results on Thursday that came in ahead of analyst forecasts, even as the chemicals group posted a net loss amid a difficult market backdrop and disruptions linked to the Middle East conflict.
Shares of the company slipped 1.06% in premarket trading following the release.
The company recorded an adjusted loss per share of -$0.14, outperforming expectations for a -$0.27 loss.
Revenue reached $9.8 billion, exceeding analyst estimates of $9.65 billion, but declined 6% year-on-year from $10.4 billion in the same period last year.
Pricing pressure weighs on performance
The drop in revenue was mainly driven by a 7% fall in local pricing and a 2% decrease in volumes, partially offset by a 3% positive impact from currency movements.
Operating EBIT came in at $154 million, down $76 million compared with a year earlier, largely due to lower pricing, though partly mitigated by savings from cost-cutting initiatives. The company also halted recognition of equity losses from its Sadara joint venture during the quarter after liabilities reached their carrying value.
“In the first quarter, our results reflect the growing impact of Dow’s self-help actions,” said Jim Fitterling, chair and CEO. “Additionally, the margin backdrop began to positively inflect in March following global supply constraints, as impacts from the conflict in the Middle East quickly became widespread.”
Segment performance mixed amid lower volumes
Total volumes declined 2% year-on-year, with Industrial Intermediates & Infrastructure particularly affected by the Middle East conflict.
The Packaging & Specialty Plastics segment reported sales of $4.9 billion, down 7% from a year earlier, while Performance Materials & Coatings remained steady at $2.1 billion.
Cash flow improves on working capital gains
Cash generated from operating activities in continuing operations rose to $1.1 billion, up by $1.0 billion year-on-year, supported mainly by a payment received from NOVA Chemicals and improvements in working capital.