US chemical companies' earnings continue to increase, C&EN survey reports
U.S. chemical companies finished 2004 with five straight quarters where earnings increases topped 40 percent when compared with the comparable year-earlier quarter, according to a Chemical & Engineering News survey of 24 firms representing a cross-section of the industry. C&EN is the weekly newsmagazine published by the American Chemical Society, the world's largest scientific society.
The survey, published in the Feb. 28 issue of C&EN, also notes that for the first year since 1995, total earnings for those sampled increased in every quarter when compared with the comparable year-earlier quarter.
For the fourth quarter of 2004, total earnings at the 24 companies, "excluding significant, extraordinary and nonrecurring items," climbed 45.2 percent from the same quarter in 2003 to $2.76 billion, as sales rose 16.4 percent to $35.3 billion, C&EN says. This drove the aggregate profit margin for the companies to 6.4 percent from 5.2 percent the previous year.
The survey found that for 2004, earnings rose 52 percent compared with 2003, to $9.58 billion, on a 15.1 percent sales increase to $139.7 billion. Aggregate profitability rose to 6.9 percent from 5.2 percent in 2003.
C&EN says that the reason for the growth rests with the industry fundamentals of pricing, demand and the output needed to fill the demand. "Of particular note was the solid increase in selling prices, which have been essential to temper the continuing rising raw material and energy costs," according to Raj L. Gupta, Rohm and Haas chief executive officer.
The top 10 chemical industry leaders in earnings among the 24 for 2004 were Dow Chemical, DuPont, Praxair, PPG Industries, Air Products, Rohm and Haas, Monsanto, Engelhard, Sigma Aldrich and Eastman Chemical.
Source: Eurekalert & othersLast reviewed: By John M. Grohol, Psy.D. on 21 Feb 2009
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