Chemical Earnings Nosedive Continues in Third Quarter

Earnings in the chemical industry averaged a double-digit decline in the third quarter compared with a year ago. Earnings for oil companies, however, were up slightly at 2% and were essentially flat for diversified manufacturers. And profits at drug companies were up strongly at 18% over the year-earlier quarter. Total earnings at the 30 chemical companies regularly surveyed by C&EN declined 25%, continuing the trend that started in the middle of last year. This was the fifth quarter in a row that results fell and it is the fourth straight quarter that the earnings contraction has been greater than 20%. However, the third quarter was full of inconsistencies. While combined earnings at the 30 companies dropped, sales for the group averaged a rise of 10%, the best year-to-year sales growth performance since the first quarter of 1989. And, in spite of the much talked about chemical slowdown, only 12 of the 30 companies registered earnings ...