Earnings Guidance
Q: Is the $6.4B EBITDA target for 2024 still achievable?
A: Management confirms they are on track to deliver the $6.4 billion EBITDA target for the year, citing strong first-quarter results and additional contributions from the restart of Glycol 2 in Plaquemine, which will add $100 million in both Q3 and Q4. They note underlying chemical demand is improving, with inventory levels at historic lows and volume growth appearing to be demand-driven rather than restocking.

Free Cash Flow Outlook
Q: How do you see free cash flow tracking in 2024?
A: They anticipate free cash flow to improve in the second half as earnings grow due to volume increases. While working capital was a use of cash in the first half, they expect it to turn around. They also plan to leverage "unique to Dow" cash levers, aiming for $1 billion to $3 billion from initiatives like asset evaluations and working capital improvements.

Capacity Rationalization
Q: Will we see more capacity cuts in the global ethylene chain?
A: Management expects ongoing capacity rationalization, particularly in Europe where high-cost assets face pressure from increased CO₂ costs and maintenance expenses. Recent shutdowns are driven by older, less competitive units, and they anticipate this trend to continue due to decarbonization efforts and higher costs in Europe.

Operating Rates
Q: What are your expectations for operating rates in Q2 and beyond?
A: Operating rates improved by about 10 percentage points globally in the first quarter, driven by higher demand and lower energy costs in Europe. North America, Latin America, and Canada are running above 80% to 90%. They are optimistic about continued strong operating rates as a sign of underlying demand growth.

Hydrogen-Fueled Cracker & Mura Investment
Q: How will the hydrogen-fueled cracker and Mura investments impact costs and returns?
A: The hydrogen-fueled cracker in Alberta is expected to have returns equal to or greater than Texas-9, aided by carbon pricing and investment tax credits from Canada. There's strong demand for low-carbon products, and they are working on securing premium pricing. The Mura project will meet high demand for recycled polyethylene, where supply is currently short, and is anticipated to be highly profitable due to its efficient process.

Silicones Market Trends
Q: What is the outlook for silicones in Q2?
A: Improvement is expected in both upstream siloxanes and downstream silicones due to better pricing and demand, particularly in electronics, automotive, and personal care markets. Higher operating rates in China and positive movements in personal care contribute to this positive outlook.

Functional Polymers Demand
Q: Where are you seeing increased demand in functional polymers?
A: Increased demand is driven by robust infrastructure markets, including wire and cable, automotive, footwear, and solar applications. They highlighted growth in power demand for electric grids and renewable energy installations, as well as a significant new business in solar PV encapsulation.

Industrial Intermediates & Infrastructure
Q: Why is II&I EBITDA flat despite seasonal strength?
A: The flat EBITDA forecast is due to non-recurring insurance recoveries from the first quarter related to the Glycol 2 situation in Plaquemine. The underlying business remains strong with improved operating rates, particularly in Europe, and slightly better construction demand.

Silicone Restocking & Construction
Q: Have you seen restocking in Europe and improvements in construction?
A: No significant restocking in Europe has been observed. However, there are positive signs in construction trends, such as marginal improvements in existing home sales and an uptick in building permits. They expect demand to increase with potential interest rate declines, positively impacting downstream products in their portfolio.

Hydrocarbons & Energy Volumes
Q: Will Hydrocarbons & Energy be a headwind in Q2?
A: They may see Hydrocarbons & Energy volumes be slightly lower, but margins are expected to improve. Focus remains on running derivatives harder and capitalizing on higher operating rates. Improved pricing in China and strong demand in electronics and automotive sectors support a positive outlook.