MIDLAND, MI - The Dow Chemical Co., Midland, MI, delivered sales of $12.9 billion in the third quarter of 2010, a 23 percent increase compared with the same period last year. Top-line growth was driven by a 14 percent increase in volume and a 9 percent increase in price. Double-digit sales gains were reported in all geographic areas, with the largest increases in North America (27 percent) and Latin America (24 percent). All operating segments reported double-digit sales increases.
Broad-based price gains were achieved in all geographic areas, led by Latin America (13 percent) and North America (12 percent). All operating segments reported year-over-year price increases except Health and Agricultural Sciences (down 7 percent) and Electronic and Specialty Materials (down 1 percent). The largest price gains were reported in the combined Basics segments, which collectively posted a 17 percent increase. The company's price gains more than overcame a $585 million increase in purchased feedstock and energy costs.
At a company level, volume grew 14 percent, with gains reported in all geographic areas and in all operating segments. Double-digit demand growth was reported in all operating segments, with the exception of Basic Plastics (up 5 percent) and Coatings and Infrastructure (up 1 percent).
On a geographic basis, the largest demand growth was reported in Europe, Middle East and Africa (EMEA) (16 percent) and North America (15 percent). Demand in Latin America rose by 11 percent, primarily due to strong volume growth in Health and Agricultural Sciences. Volume in Asia Pacific increased 8 percent, led by gains in Electronic and Specialty Materials.
Sales in the Electronic and Specialty Materials segment were $1.4 billion, up 12 percent from the same quarter last year. Volume increased 13 percent, while price was down 1 percent. In the Electronic Materials business, the recovery in electronics end-markets that started in the second quarter of 2009 continued, with significant demand improvements year-over-year. This was particularly true in Asia Pacific where the business saw volume growth of 30 percent, as foundry utilization rates remained high and emerging regions provided solid demand for electronic devices. The highest demand growth was reported in Display Technologies and Growth Technologies, both of which had over 50 percent volume gains, driven by strong end-market demand for televisions and computer monitors, as well as gains in the advanced packaging growth platform. The business achieved several customer wins in the quarter related to its technologies for chemical mechanical planarization pads and slurries, metallization materials and optical filters for advanced plasma displays.
Sales in Specialty Materials rose versus the same period last year, with double-digit volume gains in Dow Microbial Control, Dow Water and Process Solutions and Dow Wolff Cellulosics and volume growth in all geographic areas. Dow Microbial Control reported double-digit volume gains in all geographic areas, with particular strength in energy end-markets in North America. Dow Water and Process Solutions reported double-digit volume growth for its reverse osmosis membranes and ion exchange resins, with notable strength in Asia Pacific, where demand for these products rose over 30 percent. Dow Home and Personal Care reported the strongest volume improvement in Latin America, as brand owners continue to place greater focus on growth in emerging regions.
Sales in Coatings and Infrastructure were $1.3 billion, up 11 percent compared with the same period last year. Volume rose 1 percent year-over-year, and price was up 10 percent. Volume and price gains were reported in all geographic areas. Dow Coating Materials reported double-digit sales gains in both architectural and industrial coatings. Tight epoxy fundamentals, particularly in epoxy intermediates, drove pricing in industrial coatings, with double-digit price gains in all geographic areas. In architectural coatings, continued weak construction end-markets in the developed economies were offset by robust volume growth in Asia Pacific, where the business continues to benefit from new products that were launched in the region. Additionally, the business reported year-over-year volume growth in North America architectural coatings due in part to customer wins related to recently launched, unique innovations for residential paint end-markets. Sequentially, margin expansion was seen in the architectural coatings business, due in part to pricing gains and resumed production of key raw materials from the company's Deer Park production facility. Dow Building and Construction reported volume growth in all geographic areas except North America, which was primarily impacted by weakening new housing starts in the United States. While residential and commercial construction end-markets remain weak, the business' construction chemicals portfolio is benefiting from trends toward remodeling, with double-digit volume growth reported for these products. Dow Adhesives and Functional Polymers reported demand growth in all geographic areas, with the largest increase in North America, driven by a rebound in demand for industrial laminates, as well as growth projects involving the business' specialty labels and tapes.
Dow Reports Third-Quarter Results
November 10, 2010