Dow Chemical 3Q profit up 20 percent but misses Street

MIDLAND, Mich. (AP) -- Dow Chemical Co.'s third-quarter net income jumped nearly 20 percent, helped in part by gains from a joint venture in Kuwait that partly offset a decline in several businesses, including its epoxy unit. The Midland, Mich., company also said it aims to generate $3 billion to $4 billion by selling off more assets. The results missed Wall Street expectations and shares were sliding Thursday before markets opened. The company earned $594 million, or 49 cents per share, in the three months that ended Sept. 30. That compares with net income of $497 million, or 42 cents per share, in the 2012 third quarter. Adjusted earnings totaled 50 cents per share, which fell sort of average analyst expectations of 54 cents per share. Revenue inched up about 1 percent to $13.73 billion. Analysts expected $14.02 billion, according to FactSet. Dow said its earnings from investments in other companies climbed to $322 million in the quarter, an 84 percent increase from $175 million last year, mainly due to its joint venture in Kuwait. The company also helped its bottom line by cutting research and development and selling, general and administrative expenses by more than 3 percent and 5 percent respectively. But total revenue growth was nearly flat, hurt by a 7 percent drop in the company's feedstocks and energy segment to $2.3 billion. Performance materials revenue, which includes its epoxy business, also fell 3 percent to $3.3 billion due to a drop in volume. Earlier this month, Dow said it would sell its polypropylene licensing and catalysts business to W.R. Grace & Co. for $500 million. Chairman and Chief Executive Andrew Liveris said in a statement Thursday that the company has identified other units to divest, with a target of raising between $3 billion and 44 billion. The company's stock sank $1.24, or 3 percent, to $39.80 in pre-market trading. The stock has climbed about 27 percent so far this year, closing Wednesday at $41.04. Published: Fri, Oct 25, 2013