Dow Chemical on Wednesday reported a sharp drop in third quarter profits, hours after saying it planned to cut five percent of its global workforce, or 2,400 employees, and close 20 plants.
The company reported quarterly profits of $497 million compared to $815 million the previous year, a 39-percent drop.
Dow said Tuesday it aimed to generate $500 million in savings on annual operating costs from the cuts by the end of 2014.
The company will also cut capital investment on programs it no longer sees as priorities, for another $50 million in savings, it said.
The shuttered facilities will include plants in Tessenderlo, Belgium; Delfzijl, the Netherlands; Ribaforada, Spain; Birch Vale, United Kingdom; Kina Ura, Japan; and in the United States, in Midland, Michigan, and Solon, Ohio.
"The reality is we are operating in a slow-growth environment in the near term," chief executive Andrew Liveris said Tuesday.
"While these actions are difficult, they demonstrate our resolve to tightly manage operations -- particularly in Europe -- and mitigate the impact of current market dynamics."
Liveris said the company will continue funding projects where it can make a strong market stand and grow margins despite the difficult macroeconomic environment.
These include its Dow AgroSciences and Dow Electronic Materials divisions as well as its Sadara joint venture in Saudi Arabia and investments on the US Gulf of Mexico coast.