Dow to book Q3 restructuring charges of $500 million to $600 million as it cuts costs during pandemic

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Dow Inc. said Wednesday it expects to book restructuring charges of $500 million to $600 million in the third quarter, as the materials science company, which makes plastics and paints among other products, pushes ahead with a cost cutting program during the pandemic. The company said the charges will consist of severance and related benefit costs, exit and disposal activity costs and asset write-downs and write-offs. The company is on track to achieve its reduced target for capex of $1.25 billion in 2020, down from $2.0 billion in 2019. “Given the expected gradual and uneven global economic recovery from COVID-19, we announced in July that we are taking necessary actions to continue to optimize our asset footprint, reduce structural costs and enhance the competitiveness of our business over the long-term,” Chief Executive Jim Fitterling said in a statement. The company is expecting to close the dale of rail infrastructure assets at six North American sites to Watco three months earlier than planned for cash proceeds or more than $310 million. Shares were not active premarket, but have fallen 15% in the year to date, while the S&P 500 has gained 3.2%.
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