Dow Corning Sales, Profits Drop
MIDLAND -- Dow Corning Corp. Wednesday reported adjusted net income of $66.4 million in the first quarter, down 6 percent from a year earlier.
Sales were $1.26 billion, down 17 percent from a year earlier.
Sales were down in both the silicones and polysilicon segments, with the polysilicon segment realizing the largest reduction.
Dow Corning's Hemlock Semiconductor Group joint ventures continue to be challenged as the threat of potential duties on its products sold into China remains unresolved.
"Significant oversupply and high raw materials costs continued to challenge the performance of our silicones segment in the first quarter," said Dow Corning executive vice president and CFO J. Donald Sheets. "Consistent with our strategy, we are beginning to see opportunities with a number of the high-value, differentiated products we've developed alongside our customers, however those opportunities are not sufficient to make up for the broader pricing pressure in the silicones segment."
Sheets noted that "Hemlock Semiconductor's performance continued to worsen as the solar polysilicon industry deals with excess inventories and awaits resolution of the global trade disputes."
And, Sheets said, "In the first quarter, we made some tough decisions to reduce Dow Corning's cost structure to enable us to continue to invest in developing innovative products that bring value to both our customers and to Dow Corning. While we expect the difficulties we're facing to continue through the year, Dow Corning's strategy for long-term success is clear, and our foundation is financially strong."
A global leader in silicones, silicon-based technology and innovation, Dow Corning offers more than 7,000 products and services via the company's Dow Corning and Xiametter brands. Dow Corning is equally owned by Midland-based Dow Chemical Co. and New York-based Corning Inc.
Hemlock Semiconductor Group is comprised of several joint venture companies among Dow Corning, Shin-Etsu Handotai, and Mitsubishi Materials Corp. Hemlock Semiconductor is a provider of polycrystalline silicon and other silicon-based products used in the manufacturing of semiconductor devices, and solar cells and modules. Hemlock Semiconductor began its operations in 1961.
