Dow Chemical Company (DOW), a leading manufacturer of chemical products, has posted a 60.12 percent plunge in profit for the quarter ended Jun. 30, 2014. The company earned $967 million or $0.73 a share in the second-quarter compared with $2,425 million or $1.87 a share a year ago. Non-GAAP earnings per share came in at $0.74, when analysts expected $0.72.
Revenue during the second-quarter went up marginally 2.33 percent to $14,917 million from $14,577 million in the last year period.
Gross margin expanded by 28 basis points over the previous year period to 17.25 percent. Operating income for the quarter declined to $1,320 million compared with $3,279 million in the last year period. That has resulted in contraction of 1,365 basis points in operating margins to 8.85 percent.
As on Jun. 30, 2014, the company's cash balance stood at $3,843 million, down 21.30 percent or $1,040 million from Jun. 30, 2013.
Andrew N. Liveris, Dow's chairman and chief executive officer, said, ''Our results reflect excellent progress against Dow's near-term priorities, and clearly illustrate our ongoing drive to execute self-help actions that are delivering growth on both the top and bottom line.''
''Our operating priorities are delivering strong results despite ongoing slow growth and volatility in the global marketplace. We remain focused on these priorities as we continue to execute against our business-by-business plans - maximizing value through a balanced mix of differentiated technology and integrated, advantaged value chains.
Strategically, our key high-return growth projects - such as the launch of Enlist™, the Sadara joint venture and our investments on the U.S. Gulf Coast - all remain on schedule and on budget, with 2015 serving as a major start-up year for all three," Liveris said.
Working Capital
Dow Chemical has witnessed a decline in the working capital over the last one year. The company's working capital stood at $12,404 million as at Jun. 30, 2014, down $310 million or 2.44 percent from $12,714 million on Jun. 30, 2013. It registered an increase in current ratio to 2.04 as at Jun. 30, 2014 from 2 on Jun. 30, 2013.
Debt Position
Dow Chemical has witnessed a decline in the total debt over the last one year. As on Jun. 30, 2014, total debt stood at $17,244 million, down 8.40 percent or $1,582 million, from Jun. 30, 2013.
The company's total debt was 25.08 percent of total assets as on Jun. 30, 2014, compared with 26.84 percent on Jun. 30, 2013. It has witnessed a decline in debt to equity ratio to 0.62 on Jun. 30, 2014 compared with 0.78 on Jun. 30, 2013.
Interest coverage ratio, which determines how easily a company can pay interest expenses on outstanding debt, has declined to 5.45 from 11.75 in the same period last year.
Shares of Dow Chemical gained $0.44 or 0.85 percent to settle at $52.30 on Tuesday.
