Dow Chemical's first-quarter profit surged on lower costs and strong sales of adhesives and other consumer-focused products.
The specialty chemicals maker's profit rose five-fold to $888 million, or 72 cents per share, compared to a year ago when it had a hefty charge for a legal settlement.
Earnings, adjusted for non-recurring costs, came to $1.04 per share, which exceeded Wall Street expectations. The average estimate of six analysts surveyed by Zacks Investment Research was for earnings of 99 cents per share.
Revenue at the Midland, Michigan-based company rose 23.6 percent to $13.2 billion in the period. That beat the Street's average forecast of $12.4 billion, according to Zacks' survey of four analysts.
Dow's focus on the consumer market drove growth in the quarter. Sales at its consumer solutions unit, which makes adhesives and other products, soared 51 percent to $1.6 billion. The infrastructure solutions unit, which makes building products, saw an even faster growth, with sales rising 58 percent to $2.53 billion.
Dow's materials and chemicals unit and the plastics division also reported strongly higher sales. The only decline came from Dow's agricultural unit, which sells seeds, where sales fell 4.7 percent to $1.57 billion.
Dow is in the process of completing a $62 billion merger with rival DuPont Co. That deal, approved in July of 2016, is expected to close in August. The combined company plans to split into three separate, publicly traded companies, one focusing on agriculture, one on material science, and one on the production and sale of specialty products.
Dow Chemical Co. shares have risen 12 percent since the beginning of the year, while the Standard & Poor's 500 index has increased almost 7 percent. The stock has climbed 20 percent in the last 12 months.
Elements of this story were generated by Automated Insights using data from Zacks Investment Research. Access a Zacks stock report on DOW at https://www.zacks.com/ap/DOW
Keywords: Dow Chemical, Earnings Report