Dow
On October 24, Dow Inc. reported its third-quarter 2024 results. The company achieved a net sales of USD 10.9 billion in Q3 2024, up 1% compared to the year-ago period, led by higher sales in the U.S. & Canada. Sales were flat sequentially. Within Dow’s Industrial Intermediates & Infrastructure segment, which includes the polyurethane business, the net sales were USD 3 billion, down 2.4% versus the year-ago period. The sales volume was down 2% year-on-year, driven by lower volumes in Polyurethanes & Construction Chemicals, primarily from a force majeure in MDI following a third-party supplier outage. Op. EBIT decreased USD 74 million versus the year-ago period, driven by higher planned maintenance activity and lower integrated margins, partly offset by improved equity earnings. On a sequential basis, Op. EBIT decreased USD 60 million, driven by lower integrated margins and higher planned maintenance, which were partly offset by the restart from an outage at Louisiana Operations.
Strategic Developments at Dow:
Dow recently announced a strategic review of select assets in Europe, primarily those in its Polyurethanes business. The European assets account for nearly 20% of its sales in the EMEAI region. Dow also plans to shut down a propylene oxide (PO) unit at Freeport, Texas in 2025 as part of its efforts to rationalize polyol capacities. Just a couple of days ago, for the same reason of an oversupply of polyols in the global market, Dow decided to cease production of 50 ktpa of polyether polyols at its plant in San Lorenzo, Santa Fe Province, Argentina.
The focus on U.S. import tariffs has intensified recently due to the upcoming U.S. presidential election. How does Dow think that plays out for them?
“Gulf Coast because of the very strong competitive advantages that we have here. The large markets, China in particular, is still an importer and it’s going to be an importer for quite some time. So I think that will exist. In most of the other markets, we are in the market to be a domestic player. So we’re in Europe for Europe, and for the assets that we have in China, we are in China for China. There’s a lot of discussion going on around tariffs. I think we are typically not in the crosshairs of some of the issues that are national security related. So I think that doesn’t have a particular impact on us. And then we’ll walk through what will happen with them. I would say, carbon border adjustment mechanisms could be considered a form of a tariff as well, and so we’re going to stay eyes wide open to that.”
BASF
On October 30, BASF disclosed in its Q3 results that the company’s sales from January to September 2024 totaled EUR 49.4 billion, down 6.8% year on year. The EBITDA before special items was EUR 6.29 billion, down 1% year on year. Net income was EUR 2.08 billion, up 15% year on year. In the third quarter alone, BASF achieved sales of EUR 15.74 billion, almost unchanged from the prior year. The EBITDA before special items in this quarter rose 5% year-on-year to EUR 1.62 billion, and the net income was EUR 287 million, marking a significant increase compared to a loss of EUR 249 million in Q3 2023.
BASF stated in the report that volume growth in almost all segments compared with the third quarter of 2023 had a positive impact on sales performance. Lower prices in nearly all segments, particularly for precious and base metals in the Surface Technologies segment, also hindered sales performance.
Strategic Developments at BASF:
The substantial increase in BASF’s net income for the third quarter was primarily due to special income of ERU 398 million in connection with the transfer of Wintershall Dea assets to Harbour Energy plc. BASF is also advancing a cost savings program for the Ludwigshafen site in Germany. It is worth noting that at the end of September this year, BASF set a new direction with its corporate strategy to guide its approach to portfolio management, capital discipline, and fostering a performance-driven company culture. “We will put an even higher focus on cash. We will strengthen capital discipline with lower capital expenditures and continue our cost savings programs,” says BASF’s Chief Financial Officer Dr. Dirk Elvermann.
Covestro
On October 29, Covestro reported that in the third quarter 2024, group sales remained stable at around EUR 3.6 billion (+1.0%), the EBITDA increased to EUR 287 million (+3.6%) and the net income reached EUR 33 million. In the third quarter of 2024, Covestro continued to increase its volumes sold, particularly in the EMLA and APAC regions. Going through different industries, Construction showed the highest growth rate, with a low teens percent increase and Furniture with a mid-single-digit percent volume increase. Electro developed flattish and Auto exhibited a low single-digit volume reduction.
Strategic Developments at Covestro:
On October 1, Covestro signed an investment agreement with ADNOC, marking the beginning of a multistep takeover process, which Covestro believes is in the best interest of their shareholders, the company and all stakeholders. Last Friday (October 25), ADNOC published the offer document. The publication of the offer document marked the start of the initial acceptance period, which will last until November 27, 2024. A potential additional acceptance period might last from December 3 until December 16, 2024. The Board of Management, together with the Supervisory Board, will issue their recent statement in due course.
