Dow Chemical (NYSE:DOW) swung to a loss in the fourth quarter as weak demand for plastics and coatings pressured sales.
The industrial manufacturer saw its capacity drop 9 percentage points to 72% during the quarter, the lowest level since the last recession. The results sent shares of the largest U.S. chemical maker by revenue down 2% in morning trade.
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Dow reported record sales of $5 billion in its emerging markets unit, which helped offset weaker performance and lower volumes in both North America and Europe. The developing regions jumped to 35% of the company’s total global sales.
For the quarter, the Midland, Mich.-based manufacturer reported a net loss of $20 million, or 2 cents a share, compared with a year-earlier profit of $426 million, or 37 cents.
Excluding one-time items, the chemicals maker earned 25 cents, below average analyst estimates of 30 cents in a Thomson Reuters poll.
Revenue for the three months ended Dec. 31 was $14.1 billion, up slightly from $13.8 billion a year ago, but narrowly missing the Street’s view.
Higher commodity costs have squeezed Dow and other manufacturers; however the company raised prices by as much as 5%, helping to offset a $476 million increase in purchased feedstock and energy costs.
“In the midst of uncertainty and significant destocking across customer supply chains, we maintained our focus on financial discipline and operating efficiency,” Dow CEO Andrew Liveris said in a statement.
The company said it will continue benefiting from its geographic footprint in 2012 and will maintain firm operating discipline and cost controls. It also predicts improving dynamics in the North American feedstock industry.