Record sales of seeds and new crop protection products helped boost Dow AgroSciences LLC revenue 14 percent in the first quarter, leading to record profit.
The Indianapolis-based maker of agricultural products, a unit of Michigan-based Dow Chemical Co., brought in $2.1 billion in revenue compared with $1.7 billion a year earlier.
Profit in the latest quarter totaled $484 million before accounting for interest, taxes, depreciation and amortization. That was a 7-percent jump from $451 million a year earlier, Dow Chemical reported Thursday morning.
Sales of crop protection products swelled 7 percent, driven by gains in North America and Latin America. Sales of seeds, genetic traits and oils rocketed 37 percent, due in part to strong demand for the firm’s genetically modified SmartStax products.
On the whole, Dow Chemical Co., the largest U.S. chemical maker by sales, posted first-quarter profit that beat analysts’ estimates as lower prices for natural gas increased earnings from plastics.
Net income climbed 28 percent to $635 million, or 46 cents a share, from $497 million, or 35 cents, a year earlier, Dow reported.
Profit excluding a tax charge and other one-time items was 69 cents a share, topping the 61-cent average of 16 estimates compiled by Bloomberg News.
Company-wide sales declined to $14.4 billion from $14.7 billion in the first quarter of 2012, missing the $14.9 billion average of 12 estimates.
Chairman and CEO Andrew Liveris is selling Dow’s least profitable units, cutting jobs, closing plants and deferring investments to counter slower global economic growth.
Lower costs for raw materials derived from gas and oil helped increased profit in performance plastics, Dow’s largest business, Liveris said Thursday.
“They beat [estimates] primarily because of continuing trends in agriculture and performance plastics,” Hassan Ahmed, a New York-based analyst at Alembic Global Advisors, told Bloomberg News on Thursday. “There are some early signs of recovery in electronics as well.”
Dow shares rose more than 4 percent to $33.60 in early trading Thursday. The shares are little changed this year.