Dow Chemical (Midland, Michigan / USA; www.dow.com), the world´s largest plastics producer, posted fourth quarter net earnings down 11% on the previous year at USD 975m, blaming weak demand in the North American construction sector and a fall in sales in its basic chemicals segment. However, the company achieved its highest fourth quarter sales, up 3% on last year at USD 12.2 bn. Over the full year the sales increased by 6% to a record high of USD 49.1 bn while net earnings fell 18 % year-on-year to USD 3.7 bn.

EBIT in the basic plastics segment fell by 26% in the fourth quarter to USD 461m on sales up 1% in at USD 2.94 bn. Softness in the North American market was offset slightly by modest growth in Europe and double-digit improvements in Latin America and Asia Pacific regions. Full year earnings in the segment fell to USD 2.0 bn from USD 2.4 bn the previous year on sales up 7% at USD 11.8 bn.

Fourth quarter EBIT in the performance plastics segment fell to USD 347m from USD 960m the previous year. The 2006 figures include an allocation of USD 85m associated with the fine from the EC relating to a synthetic rubber cartel, while the 2005 result includes a net gain of USD 637m from the sale of UOP. Sales in the quarter reached a record high of USD 3.55 bn, up 11% year-on-year, thanks to strong gains in all regions other than North America where the housing and automotive sectors were particularly weak. Full year EBIT in the segment fell to USD 1.6 bn in 2006 from USD 2.5 bn the previous year on sales up 12% at USD 13.9 bn.

Dow CEO Andrew Liveris said that the company will continue to invest for long-term growth, adding: "We believe that 2007 will be another very good year for Dow and that our transformational strategy will continue to create an earnings ridge for some time to come."

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Detailed Dow presentation on fourth quarter and full year 2006 as PDF document (116 KB)