(Reuters) – Chemicals maker Dow Inc on Thursday beat Wall Street estimates for first-quarter profit as stronger product prices and demand helped it overcome a surge in raw material costs.
Local prices across Dow’s three segments were up between 24% and 39% after the company boosted rates in an effort to combat supply-chain pressures, logistical snags and weather-related outages at plants.
Shares of the company rose 5% to $70.94 in morning trade.
Rising inflation and energy prices hitting multi-year peaks were expected to undercut the economic recovery that has lifted Dow’s earnings in recent quarters.
But Chief Executive Officer Jim Fitterling said the company navigated the “stubbornly high” costs of crude oil and natural gas by taking advantage of abundant shale-based feedstocks.
“Despite higher energy costs, we captured healthy end-market demand and achieved solid volume growth, price gains and margin expansion,” Fitterling said.
Total net sales rose to $15.26 billion from $11.88 billion a year ago.
The company, which makes chemicals used in a range of products including food packaging, mattresses, textiles and electronics, also said it took a $186 million hit to earnings in the quarter due to the ongoing Russia-Ukraine conflict.
Excluding items, Dow’s earnings of $2.34 per share beat analysts’ average estimate of $2.06, according to Refinitiv data.
(Reporting by Shariq Khan; Editing by Devika Syamnath)
