Document M4exEyzVxGGJewBRVOoOwBXYk

f STOOiH 127 DOW 1959 ANNUAL REPORT for the year ended May 31, 1959 The Dow Chemical Company DIRECTORS AND OFFICERS DIRECTORS Earl W. Bennett, Chairman Donald K. Ballman A. P. Baatal R. H. Boundy C. B. Branch Calvin A. Campbell HarbaH D. Doan Island I. Doan Aldan B. Daw Harbort H. Dow Carl A. Gantackor N. D. Griswold Mart E. Putnam W. H. Schuatta C. J. Srrosacker EXECUTIVE COMMITTEE Inland I. Doan, Chairman Earl W. Bannatt Calvin A. Campbell Carl A. Gertfacker Mark E. Putnam C. J. Stresackor FINANCE COMMITTEE Earl W. Bannatt, Chairman Hobart B. Bannatt Prod H. Brown Calvin A. Campbell Carl A. Gontackar OFFICERS AND ASSISTANT OFFICERS Earl W. Bannatt, Chairman of the Board Inland I. Doan, President Mark E. Putnam, Executive Vice President A. P. Beutol, Vice President. General Manager Texas Division R. H. Boundy, Vice President, Director or Research Calvin A. Campbell, Vice President. Secretory, General Counsel R. L Curtis, Vice President Carl A. Gontackar, Vice President. Treasurer J. D. Hanowalt, Vice President W. H. Schuatta, Vice President, Genera! .Manager Midland Division C. J. Sirotackor, Vice President Donald Williams, Vice President. Director uj Corporate Relations Robert B. Bannatt, Assistant Treasurer. Assistant Secretary Prod H. Brown, Assistant Treasurer, Assistant Secretary Inland A. Doan, Assistant Secretary, General Manager Western Division lutkar Evans, Assistant Secretary, Assistant General Manager Texas Division W. A. Groaning, Jr., Assistant Secretary, Assistant General Counsel C. P. Weaver, Auditor TRANSFER AGENTS The Cleveland Trust Company Morgan Guaranty Trust Company of Plow York REGISTRARS The National City Bank of Cleveland The Now York Trust Company CERTIFIED PUBLIC ACCOUNTANTS Haskins I Sells THE ANNUAL MEETING The Annual meeting of stockholders will be held on Wednesday, September 16. 1939, at two o'clock in the afternoon. EST, in the auditorium of the Centra! Intermediate School. Rodd and Reardon Streets, Midland. Michigan. A formal notice of the meeting, to gether with a proxy statement and form of proxy, will be mailed to each bolder of Common Stock separately from this report. ; STOOQft I 20 ! STGOO'i 129 THE DOW CHEMICAL COMPANY 62nd ANNUAL REPORT 1959 Operations Summary............................................................ The President's Letter........................................................5 Report to the Stockholders...................................................6 Consolidated Balance Sheet.................................................30 Statement of Earnings......................................................22 Statements of Surplus...........................................................23 Notes to Financial Statements........................................... 24 Ten Year Statement of Financial Condition .... 26 Ten Year Statement of Earnings.......................................27 1 DIREC EI 0 0.1S i0 K Alll W. BENNETT hairman of the Board i years service CALVIN A. CAMPBELL Vice President, Secretary, General Counsel 24 years service ISLAND I. DOAN President 42 years service MARK E. PUTNAM Executive Pice President 44 years service HERBERT D. DOAN Manager, Chemicals Department 10 years service ALDEN B. DOW Director Since 1941 HERBERT H. DOW Staff Manager, Plastics Fabricated Products 7 years service iS % ? >' - StTIRU smtm tmi '4?-' board op 2 *1> iirtmoToits . J TORS D. K. BAUMAN Drrector of Sales 24 year* sen ice OUtl A. GERSTACKER Vice President, Treasurer 21 years service A. P. liUTCl Pice President, Cnera/ .Manager, Texas Division 43 years service t. H. BOUNDY Pice President, Director of Research 33 years service C. B. BRANCH President, Dow Chemical international Limited, S.A. 22 yean service N. 0. GRISWOLD Assistant General Manager, Texas Division 32 years service W. H. SCHUETTE Vice President, General Manager, Midland Division 18 years service C J. STROSACKER Vice President 51 yean service E. O. BARSTOW Honorary Chairman of the Board 39 years service & . -I R. L CURTIS Vice President 37 years service 3 ST 0 0 HI JI 1 4' ST 0 0 0 31 Z OPERATIONS SUMMARY A two year comparison Net Sale Total Iacoa* ` 1969 3705,442,403 713,500,598 82,711,521 53,244,000 62,916,016 2.39 31,436,875 516,806,601 Shares of Common Stock Outstanding Common Stockholders 26,357,090 83,400 1958 3636,201,143 645,161,000 82.383,709 42.421,000 46,059,181 1.78 30,817,227 463.385,928 25,877,131 80,800 During the 1958 fiscal year the Company dis tributed Common Stock to its stockholders in the ratio of one share for each fifty shares held. 4 THE PRESIDENT'S LETTER TO THE STOCKHOLDERS TO THE STOCKHOLDERS: This sixty-second annual report is submitted under considerably happier circumstances than those of a year ago. The 1959 fiscal year could be characterized most accurately as a year of recovery, and it was a recovery more rapid and more vigorous than anyone could reasonably have anticipated at this time last year. Just as the economic decline was largely responsible for our depressed sales and earnings in 1958. the upturn in the nation's economy has been a major factor in our improved performance this past year. However, much credit is due our own people for their excellent work in controlling costs, in sharpening our research, production and marketing efforts -- in short, achieving greater efficiency and effectiveness in all areas of operation. The combination has served to bring us to a new high in dollar sales at $705 million and effect a marked improvement in earnings. Thus we have reason for confidence, but cannot, however, afford any complacency. We face many immediate and long-range problems, and we are determined not only to guard jealously the progress we have made but to increase the kind of efforts that have brought it about. With great regret we record the loss of a member of the Finance Committee, Charles Penhaiigen. who died May 8, 1959. Mr. Penhaiigen joined Dow in 1936 and served from 1941 as the Company Auditor and as Treasurer of Dowell from 1940. As an important member of the Finance Committee, his untiring efforts on behalf of the Company will be greatly missed. In December two changes occurred in the Board of Directors with the retirement from the Board of Dr. E. 0. Barstow and R. L. Curtis who had served as Directors since 1931 and 1948 respectively. Their long service and many contributions to the progress of the Company, both as employees and Directors, are acknowledged with deep appreciation. Elected to replace them were Donald K. Ball man. Director of Sales, and C. B. Branch, then Manager of the Plastics Department and now President of Dow Chemical International Limited S. A. Dr. Barstow was elected Honorary Chairman of the Board and will continue to serve in an advisory capacity. Mr. Curtis remains a Vice President of the Company. CO CD *?co c_u August 6, 1959 Sincerely, / President 5 THE DOW CHEMICAL COMPANY 19s9 QUAItTIRLY SUMMARY FINANCE AND EARNINGS Earnings after taxes increased 37 per cent in fiscal 1950 to $63 mil lion from $46 million in 1958. Although the first quarter, normally low. showed some effects of the recession, succeeding quarters during the year reflected better business conditions generally. While earn ings per share of S2.39, up from $1.78 last year, were greatlyimproved they were still not equal to the high of 82.52 recorded in fiscal 1956. A cash dividend of $1.20 was paid during the year. Continued organizational and promotional expenses in our textile fiber operation at Williamsburg, Virginia with only small volume in Zefran sales continue to affect earnings adversely. Prices generally continue to be under pressure but it is our hope that they will not deteriorate further if business conditions continue at their present level. Increased income and reduced capital expenditures during the year allowed us to substantially reduce our long-term debt including repayment of the 5% mortgage note to the Government on the Velasco magnesium plant. In addition, the 47c convertible deben tures were converted and the 3% issue reduced to $43 million by conversion. The quarterly summary at the left illustrates the effects of the recession on our sales and earnings. SALES Sales reached a new high of $705 million as compared with $636 million in 1958, an increase of somewhat more than ten per cent. TRIND OR OOW WAOII AND HLt.1 NO PRICKS IP hilt the level o) prices received lor Dow products declined over the year, wages and salaries per employee showed an increase. $10 034134 6 ANNUAL REPORT . STOO-34 I 35 The growth in physical volume was greater as pressure on prices continued throughout the year. Our sales picture reflected very largely the upturn in the nation's economy. Increased volume was attained in each succeeding quarter with the exception of our third quarter which is seasonally lower. In the light of the prevailing economic outlook and new products which are just gaining a foothold in the market it is reasonable to anticipate continued healthy growth in the current year. Our total sales revenue was produced by our major product categories approximately as follows: Chemicals .... 51% Magnesium .......................... 8% Plastics........... 35% Agricultural Chemicals . . . 6% PRODUCTS Chemicals The sale of chemical products increased over last year despite the fact that we experienced increased competition both from new producers entering the market and foreign producers entering coastal markets, particularly with chlorinated solvents and chemical intermediates. We expect this situation to continue and are trying to meet it by establishing closer relations with our customers and distributors. Such efforts in the field of chlorinated solvents, for example, resulted in increased volume in spite of the new competition. Sales of ethylene and propylene oxide derivatives increased markedly. Ethylene diamine and related products, a relatively new group of products, showed sufficient growth to require expanded capacity. They are used in the manufacture of textile resins because they impart drip-dry characteristics to cottons and serve as inter mediates in the production of a number of other industrial products. The Dowanol products, propylene glycol and an improved Bisphenol A all enjoyed appreciable gains, and our position in the sale of phenol to the national and international phenolic resin markets was considerably improved. The rapidly growing demand for Methocel has necessitated increased facilities which will be operating this fall. Two developments of long-term significance were the announce ment that Kaiser Aluminum and Chemical Corporation would build a plant at Midland and that E. J. Lavino & Company would build a plant at Freeport. Both will utilize magnesium hydroxide from our facilities to produce magnesium oxide lor use in refractory brick. The Harbison-Walker Refractories Company built a plant at Ludington about two years ago to use magnesium hydroxide production from our Ludington Division. 0. X. laflii'an. Director of Sales W. 1 Diinn, General Sales Manager CHEMICAL PRODUCTS DEPARTMENT W. C. Reiman, Research i. C. VanHem, Technical Service and Development H. D. Dees. Manager L R. Grant, Sales Manager 7 FUSTICS PRODUCTS DIPARTMiNT R. F. Soyar, Research N. R. Patanm. Coatings Development W. C. Goffin, Manager F. J. MacRea. Plastics Development O. J. William, Sales Manager H. H. lyoti. Manager Madison Plant This year Dow will test market its own national brand of ethylene glycol antifreeze. We have for some time been formulating and packaging antifreeze for a number of oil and automotive companies under their labels. This business will be actively supported but we feel it may be advantageous, both from our standpoint and our customers', to introduce our own brand into the market. This will also give us further entree into the automotive chemical field where we are already recognized as a major supplier of brake fluids, solvents and other industrial chemicals. Plasties For plastics this was a year of good business but intense compe tition. In many areas increases in volume were partially or totally offset by price declines and in all areas business was available only to those who sought it aggressively. Polyethylene, styrene-butadiene latexes, Saran Wrap and build ing products were particularly bright spots. Our capacity for polyethylene was doubled and new plants are now under construc tion at our Sarnia, Bay City and Louisiana plants. Roofmate, a Styrofoam insulating board, and polyethylene film for construction uses were added to our rapidly growing line of building products. The new television tubes which will make their appearance this fall were made possible by an epoxy resin we developed last year. Saran coating for cellophane has now become a large-volume com mercial development. Several new plastics reached the advanced stage of development and many more were born in our research laboratories. This continuing flow of new products and new applications should insure continued energetic growth of our over-all plastics business. Magnesium In July 1959 the Company announced the formation of a new Division, The Dow Metal Products Company. This Division is responsible for the output of our Madison mill plus the casting and fabrication business of our foundry and fabrication shops in Bay City. It will replace the Magnesium Products Department and will facilitate a broad departure from our previous role in the metals ST00J4I3G field. In addition to strengthening the sales and development of magnesium, the long-range aim of this new division is to work with any metal that shows promise of increasing the division's earnings. Sales of magnesium and magnesium-allov ingot will continue to be handled by the Sales Department. There was a strong upswing in ingot sales during the year, particularly to the aluminum industry and other large chemical and metallurgical markets. These markets should continue to grow, particularly in aluminum because of the increased amounts of mag nesium in some of the new aluminum alloys. Alloy ingot sales to the foundry industry have shown a down ward trend for some years as a result of increasing use of secondary metal and the sharp reduction of the military program. The interest of the automotive industry in reducing car weight, the automation possible with magnesium diecasting operations, and a change in automotive engineering thinking combine to oiler the possibility of expanding markets for magnesium in that industry. In the products area the year was one ol substantial recovery, with dollar sales up 30 per cent. Military use still accounts for a large share of sales and the continued growth of the missile pro gram has increased the demand for castings and mill products of the new thorium alloys designed for use at elevated temperatures. Commercial markets are expanding, however. The new Shwayder Silhouette luggage, made from magnesium sheet and extrusions, has had growing acceptance. Magnesium for tooling purposes is another growing market and three new tooling-plate distributors have been added. Since we have a wide range of versatile metal-fabricating facil ities and the demand for magnesium products fluctuates, we have been fabricating some aluminum and other metals. We anticipate that our production of nonmagnesium products will expand and thereby more fully utilize our facilities. THI DOW MiTAL PRODUCTS COMPANY A. W. Winston, AMutant to the President D. H. Oilmen, Sales Manager i. D. Harawolt, Vice President C. I. Notion, Research Hubert Proobnvf, President' Agricultural Chemicals The most significant trend in the Agricultural Chemicals Department is that of progress in the imaginative and orderly marketing of the products of research. Research continues to be fruitful, especially in developing new product lines. Movement of new producls into trade channels is being expedited by refinements in market planning. As an example, a complete program of research, product development and market planning is paving the way for a line of animal health products which should constitute a new market for Dow. More and more products are undergoing market testing, assuring that they appear under the best possible circumstances. Coordinated market planning has enabled greater versatility in market-promotion programs. For example, a program this year placed samples of Dowpon grass killer in the hands of 400,000 farmers through their local dealers. Domestic sales of Dowpon have doubled in the past year. AGRICULTURAL CHIMICAU DPARTMENT J. i. Johnson. Research W. W. Allan, Sales Manager K. C. Rarraas, Development J. W. Rrinan, Manager OO --! cn> c_o 9 TEXTILE natRS DEPARTMENT A. I. Trail, Manager O. R. Mdntirc, Technicat Director A. L Rudrfxk, Sales Manager Textile Fibers Ever since the consolidation of the Lurex yarns selling force with the newly established sales group for Zefran acrylic fiber last Sep tember, the company's Textile Fibers Department has been engaged in broadening the base of Dow's stake in the textile industry. The retail launching of Zefran in selected men's, women's and children's apparel last fall was expanded during this spring to include new blends and apparel applications. Fall 1959 garment markets will find 100 per cent Zefran fabrics in exciting new women's sportswear fines as well. A further development in early 1959 gave the department a third product, Rovana being introduced on a sales-development basis. This vinylidene chloride copolymer fiber with a flat cross section has possible application in home furnishings and accessory fabrics, as well as apparel. INTERNATIONAL OPERATIONS Our foreign business during the past fiscal year was highlighted by a new record in export sales and a major reorganization aimed at expanding our overseas manufacturing operations. Sales outside the United States and Canada handled through the two wholly owned subsidiaries, Dow Chemical International Lim ited S.A. and Dow Chemical Inter-American Limited, increased by 13 per cent over 1958 and accounted for about 10 per cent of our total sales. This is especially gratifying in view of the 1958 recession that generally depressed the export of U.S. chemicals. Western Europe continues as the major outlet for our exports, closely followed by the Far East area and Central and South America. The expansion of our overseas business and opportunities for investment abroad necessitated a reorganization of our for eign activities. C. B. Branch was appointed President of Dow International and assigned the responsibility for the management and direction of all of Dow's foreign activities with the exception of Canada and Mexico. New operational departments for investigation and implementa tion of manufacturing opportunities abroad were added to Dow International and the marketing organization was streamlined for a more direct selling to overseas customers. Formation of a new holding company, Dow Chemie A.C. in Basel, Switzerland for the financing of overseas manufacture was also announced. ST0 0 14 I 3 3 10 New offices were opened in Johannesburg, Union of South Africa and Lima, Peru, and the sales office in Caracas, Venezuela closed. Further decentralization of the European marketing setup is currently under study with the possibility of opening several new offices in Western Europe. We now have 13 foreign sales offices in twelve countries. Other major developments in our overseas activities include the formation of Dow Agrochemicals Limited with headquarters in London and a plant, currently under construction, for the manu facture of agricultural chemicals in Norfolk, England. A styrene monomer plant owned by the associated company, Asahi-Dow Limited, is nearing completion in Kawasaki, Japan. All in all, either directly or in association with foreign partners we now have manufacturing or service operations in eleven foreign countries. RESEARCH The chief purposes of industrial research are, first, to protect the profitability and usefulness of present products and keep them competitive in existing markets and, second, to develop new products which will be the basis for profitable investment of capital and expansion into new markets. S7CQHI39 The over-all effectiveness of research effort depends in large measure on the judgment factor as related to selectivity. We are constantly improving the selection of projects to be carried to pilotplant stage and also experiencing continued improvement in the effectiveness of our pilot-plant efforts. As an illustration, eleven new products introduced at the Midland Division during fiscal 1957 had required an average of 92 months from beginning of research to new product status. In 1958 eight new products introduced represented an average of 73 months in development. During 1959 seven new products have been introduced having an average research span of only 42 months. Approximately 370 million of our 1959 sales revenue was from products introduced within the past six years, and of this group 17 had sales of 81 million or more. Among the larger-volume items were methyl chloroform, a solvent; Dowpon, a selective grass 1.1. (aim, Director, Organic Research, Texas Division C. M. ShifWy. Director, Technical Research, Texas Diviu, *. 0. Hoiti, Research Director, Western Division A. T. Mmuborg. Research Director, Midland Division tl killer; Separan, an industrial flocculant; saran 909, a formulation with greatly improved properties; glycerine; polyethylene and a high-temperature thorium-zirconium-magnesium alloy. Some promising products of research currently being introduced are Rovana, a textile fiber with a flat cross section; a shrinkable form of Saran Wrap; a flexible epoxy resin; polypropylene, a new member of the plastics family; and Dowfax 2A1, a surface-active agent for detergents. Among other developments: Dow was selected as one of four chemical companies awarded a contract by the Advanced Research Projects Agency for the develop ment of new higher-energy solid rocket fuels. Dow was instrumental in developing one of the major plastic components of the Nike Zeus antimissile missile system and is one of the manufacturers of this component. An agricultural research center has been authorized for con struction near Midland which will consolidate agricultural research functions now dispersed among a number of Midland laboratories. Dow was granted during the year 316 United States patents or six tenths of one per cent of all United States patents issued during that time, and filed 532 applications for United States patents or seven tenths of one per cent of the national total. At year end the Company owned 2221 United States patents and 2788 foreign patents. 1 ' ST 0 0 1 4 1'i 0 R.Suia. General Manager, Louisiana Division thar Evont, Jjiii/anr General Manager* Texas Division G. Robk. .^sjuraru General Manager, Texas Division . I. Assistant General Manager, Texas Division GENERAL OPERATIONS In general the Company's manufacturing divisions operated at increasing levels of capacity as the second half of our fiscal year in particular reflected the nation's economic recovery. Having hit the peak of one of our cycles of expansion in 1958 our capital additions dropped to )59 million as compared with $185 million. A second polyethylene plant and a second glycerine plant were completed in Texas and expansions in ammonia, ethylene diamine and ethylene oxide derivatives are under way. New products added to the Division's product mix included anhydrous hydro chloric acid and lime slurry. 12 At Midland increased or new capacity was completed for several products, among the more significant being Pelaspan--Styrofoam expandable beads--Tvril plastic, phenacetin and soluble saran resin. A new 82 million waste disposal plant has also recently been completed. At nearby Bay City major new facilities are nearing completion including a plant for ethylene, propylene and butadiene, and a polyethylene plant. Pipelines have been laid to carry ethylene, benzene and propylene to the Midland operation. Production capacity of our Western Division was increased approximately ten per cent through moderate capital expenditures and improved operating techniques. Only minor capital investments were made at Ludington and Allyn's Point Probably the most significant event in this area was the com pletion and start-up of our new Louisiana Division. Vinyl chloride monomer was the first product to be produced, starting in July of 1958 and followed by chlorine, caustic soda, chlorinated solvents, light hydrocarbons and glycol at various stages through the fiscal year. This plant represents years of research and engineering experience and start-up operations went exceptionally smoothly. In addition to giving us efficient production units it assures our cus tomers of an additional source of basic chemicals and is a shipping point of advantage to a number of major markets. A point of major interest is the progress which has been made in cost reduction. These programs were started before the reces sion when it became evident that the profit squeeze was a problem demanding concerted action, but in the past fiscal year have gained sufficient momentum that definite results are apparent. They have involved study task forces, the training of supervision not only in the principles of work simplification but all areas of operations improvement, and, finally, the active participation of employees as related to their daily activities. As a result of the formal Operations Improvement program at the Midland Division net dollar savings during calendar 1958 were estimated at more than 83 million. This effort is not a "crash" program but a long-range objective which is firmly entrenched in the minds of our management and being brought ever more sharply into focus for all employees. L A. Dtn, General .Manager, Wextern Division M. f. Ohmon, Manager, Pittsburg Plant OO MIDLAND DIVISION I. f. Pmtstt, Production Manager, Latex Organic Chemict W. H. WilRaim, Production Manager, Bentene Products C. F. DtvsmL Production Manager, Inorganic Chemicals M. Whiting, Manager of Services C. HutdMnraatlwr, Production Manager, Ethylene Product - IhwMt f. DUn, President Dabeckmun Company DIVISIONAL. OPERATIONS Dobeckmun Sales of our Dobeckmun Division showed an increase, reflecting recovery from the recession. Dobeckmun manufactures a broad line of packaging materials. Lurex metallic yarns and other specialty products. It has been a pioneer in laminated and extruded products and this represents its largest product category. Two new products introduced during the year were Saran Wrap-S and Metalflake. Saran Wrap-S is a shrinkable saran film usually supplied in the form of bags for the "skintight" packaging of poultry and other food products. Metalflake is a sparkling metallic Rake used for decorative purposes. It has found its first volume market in tile and linoleum floor coverings; it is also used in counter top materials, wallpaper, gift wrappings and greeting cards. Our new Trycite--polystyrene film--plant at Cleveland began production in February. Already well accepted, its potential may well be increased by means of coatings which will add heat sealability and moistureproofness to the material. It is an exceptionally spark ling, clear and economical packaging film. Polyethylene film has shown an encouraging sales gain both in roll stock and custom forms. Its use for packaging food, clothing and other items is growing rapidly. Frozen vegetables packaged in W. 0. femur, Executive Pice President L 0. totnk.lt, Vice Pretident and General Manager Dobeckmun polyethylene bags were introduced on the West Coast and found good market reception. An interesting item introduced during the year was laminated precision punch tapes and punch cards for use in highly automated data-processing equipment. These tapes and cards can be rerun many thousands of times. Oowvll Dowell, for many years a wholly owned subsidiary, began operating as a Division of the parent company on June 1, 1938. This Division offers a variety of services to the oil industry, including acidizing, fracturing and cementing, as well as a chemical cleaning service for industrial equipment. Dowell's over-all business held about even with 1958 although the industrial service was somewhat expanded. This was partially due to the increasing need for chemical cleaning of missile-launch ing equipment. Special field research and development has been necessary to meet the rigid cleaning specifications for missile CO --{ CD CD -/Vro 14 launching equipment and Dowell has performed work at Cape Canaveral. Florida; Red Stone. Alabama; McGuire. New Jersey and Vandenberg, California. An interesting project during the year was the acidizing of the world's deepest well at 25.304 feet where the unusually high tem peratures and pressures required ultraheavy equipment and the use of special inhibitors. Several contributions to the art of recovering oil were made, including Frac Guide, a technique which has greatly improved the results of Dowell's fracturing operations. The outstanding minority interest in United Oilwell Service, S.A., of Caracas. Venezuela was purchased and the business now operates as a Division of Dow Chemical International Limited S.A. In Argentina a Dowell Division of Dow Quimica Argentina S.A. was established for servicing of oil and gas wells. Bay Rallnlng The last fiscal year covered a period of oversupply and reduced earnings for the petroleum industry. Bay was no exception, but crude oil and pipeline tariff reductions coupled with completion of new topping and alkylation facilities and integration with the new petrochemical plant should improve Bay's position in the coming year. SUBSIDIARIES Dow Chemical of Canada, Limited had a good year, with sales some 10 per cent over the previous high in fiscal 1958. This was in part attributable to the introduction of several products which heretofore have not been produced in Canada, including methyl chloride, methylene chloride and polystyrene foam. These are now produced at Sarnia. Late in the fiscal year Dow's first high-density polyethylene plant commenced production at Sarnia. About the same time the thorium plant at Elliot Lake. Ontario, jointly owned by Dow Canada and the Rio Tinto Mining Company of Canada, Limited and its associates, commenced production. During the year 650 acres of property were purchased at Fort Saskatchewan, near Edmonton, in Alberta and options were taken on property near Vancouver, British Columbia. Engineering now nearing completion will determine to what extent Dow Canada undertakes immediate chemical production in Canada's fast- developing West. Sales offices were opened this year in Saint John, New Brunswick and Vancouver, British Columbia. Dow is now able to give good customer service in every province in Canada. We have four other domestic subsidiaries operating in rather specialized fields. Cliffs Dow Chemical Company of Marquette, Michigan, in which we hold a two-thirds interest, is a large manu- L C. Smifhcrt, President Dow Chemical of Canada i: ST0Q04 43 15 facturer of wood distillation products including Cliffchar briquets, a popular charcoal product. Adams Paper Company of Wells River, Vermont, as its name implies, manufactures paper, and Ben-Mont Papers, Inc. of Bennington, Vermont is a converter producing various gift-wrapping materials. Extruders, Inc. of Hawthorne, California produces polyethylene film. A new plant is being built at Fresno and upon its completion this operation will relocate there. The latter three companies are wholly owned. We have numerous foreign subsidiaries which, to the extent appropriate, are reported under International Operations. ASSOCIATED COMPANIES Dow Corning Corporation, which we own jointly with Corning Glass Works, continued its 16-year growth and its sales surpassed those of any previous year. Silastic, the group of rubbery silicones used for such applications as electrical insulation and heat-resistant gaskets, continues as one of the leading product groups. As in the past, existing forms have been improved and new forms developed, one of the most interesting being RTV--room-temperature vulcanizing silastic. Because of their chemical inertness and lack of toxicity silicones are rapidly finding use in medical research. Silastic has been used in a large variety of heart valves, brain valves, tubes and coatings. Silastic drainage valves have been the key to more than 4,000 success ful operations on hydrocephalic children. Dow Corning has taken a license for manufacturing ultrapure silicon metal under the Siemens and Westinghouse know-how. This material is used in the electronics industry for power rectifiers, transistors and other semiconductor devices. The sales of Ethyl-Dow Chemical Company remained about on a par with last year. This company, which we own jointly with UST0 3 J k I 1 Ethyl Corporation, extracts bromine from sea water at Freeport, Texas, and manufactures ethylene dibromide for use in antiknock gasoline fluids. A new associated company, Dow Badische Chemical Company, was formed during the year and is currently building a plant adjacent to our Texas Division to manufacture acrylic acid as well as methyl- ethyl, butyl and other acrylic esters. Its production will be sold through Dow. This company is owned jointly with BASF Overzee N.V., a subsidiary of Badische Anilin- & Soda-Fabrik AG of Ludwigshafen, Germany. We have sold our 50 per cent interest in The Saran Yarns Com pany of Odenton, Maryland to The National Plastics Products Company, the other shareholder. INDUSTRIAL RELATIONS Another year without any work stoppage at any location was experienced, keynoted by an apparent growing maturity in rela tionships with the various union organizations. Thirteen new contracts were negotiated involving 22 union groups. Several other contracts provided wage reopenings and all were amicably settled. Personnel of the company and its subsidiaries increased slightly totaling 27,100 at year end compared with 26.600 at the end of the preceding year. The accident frequency rate for the company as a whole increased to 2.41 disabling injuries per million man-hours. While this still compares favorably with the chemical industry average of 3.55 it represents a 37 per cent increase over our 1958 rate. Several of our divisions, however, have compiled outstanding safety records. Our Allyn's Point Division completed 8V2 years without a disabling injury, our Ludington Division 6 years. Our Rocky Flats plant completed 5 million man-hours without a disabling injury--a new record for a Dow installation. Another safety milestone was reached when more than 11.000 employees at the Midland location achieved a record low-frequency rate of .95 for calendar 1958. The tenth offering since 1948 of Dow Common Stock to employees for purchase by payroll deduction resulted in 10,812 employees subscribing for 120,917 shares. This represented 39 per cent of those eligible. Directors of the parent company are not eligible to participate in these plans. At year end our noncontributory retirement plans covered 12,250 employees and 179 employees retired under the plans during the year. Among the assets of the plans were 51,448 shares of Dow Common Stock, of which 11,403 shares were purchased during the year. Among benefits paid out to retirees were 1,437 shares. Our broad program of aid to education was continued and 194 students in 55 colleges and universities were Dow scholars or fellows during the academic year. Under the Dow matching grant plan 949 employee contributions were matched, an increase of 50 per cent over the preceding year, and to date 246 educational institutions in 13 states have benefited from this cooperative program. F. C. Pattfion, Director Industrial Relations ' STOOD* US 17 SHAREHOLDERS The chart showing the classification of ownership of Common Stock as of the record date, July 29, 1959, will appear in the postmeeting report which will be mailed to stockholders. The number of shareholders at the end of the fiscal year increased to 83,400. The number of shares outstanding at May 31 increased from 25,877,131 to 26,357,090. This increase resulted from: Sales to Employees..................................................... 190,830 Conversion of 3% Debentures................................. 205,009 Conversion of 4% Debentures................................. 84,120 INCOME AND INVESTMENT The provision for depreciation and amortization of property amounted to S82.7 million for the year ending May 31. 1959. The Company uses the declining balance method of computing deprecia tion wherever applicable. Our expenditures for plant and property additions for the past ten years are as follows: 1950 .. ____$ 29,000,000 1951 . . ____ 91,000,000 1955 ......... . S 49,000,000 1956 ......... 59,000,000 1952 .. . . .. 145,000,000 1953 . . ___ 94,000,000 1957 ......... . 162,000,000 1958 ......... . 185,000,000 1954 .. ____ 59,000,000 1959 ......... 59,000,000 In the accompanying chart. "investment" is essentially net property plus working capital as more fully set forth on page 26. T I*''* CO INCOMI AND INVItTMINT V0 30 4 Hi G .V ,.Ui u 4 -'w* . ` we. - j 8|. 7j .j-r.-a-v n ' : *r'0 - ^ Sr.- 4 X H .4i rv* . -^..T /** ^% S *1 M % 3 m <* n iniiaiii iiiiuiia 18 REPORT OF INDEPENDENT ACCOUNTANTS HASKINS & SELLS CERTIFIED PUBLIC ACCOUNTANTS nmiw>m MAAOLO w. COTT, C.m. a. A A. CHAUWCCT A, nO<TQH C. A A. MOtAMO ft. KIMO, Q. A A. THC NATIONAL BANK BUILOINO DETROIT 20 THE DOW .CHEMICAL COMPANY: We have examined the consolidated balance sheet of The Dow Chemical Company and its subsidiary companies as of May 31, 1959 and the related statements of consolidated earnings and surplus for the year then ended. Our examination was made in accordance with generally accepted auditing standards, and accordingly included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. In our opinion, the accompanying consolidated balance sheet and statements of consolidated earnings and surplus present fairly the financial position of the companies at May 31, 1959 and the results of their operations for the year then ended, in conformity with generally accepted accounting principles applied on a basis consistent with that of the preceding year. July 28, 1959 HASKINS & SELLS 0 0 '1 4 1 'i 1 CO CONSOLIDATED BALANCE C^ I HOOJLS ASSETS CURRENT ASSETS: Cash .................................................................. United States Government securities--at cost Accounts and notes receivable: Trade, less reserve for doubtful accounts Miscellaneous............................................ Inventories--at lower of cost or market May 31 1959 1958 $ 33,744,236 $ 33,274,267 12,648,658 11,499,158 95,122,037 74,824,651 11,684,520 11,068,510 146,116,416 159.706.655 $ 299,315,867 $ 290,373,241 INVESTMENTS AND NON-CURRENT RECEIVABLES: Notes and accounts receivable and capital stock (at cost) of associated companies (Note B) ..................................... $ Non-current notes and accounts receivable and sundry investments (less reserve for loss, 1959, $470,128; 1958, $5,772,359) $ 5,540,413 $ 9,027,386 14,567,799 $ 6,131.437 7,771,080 13,902,517 PROPERTY -- At cost: Plants and other properties............................... Less--Accumulated depreciation, amortization, and depletion.......................................... .. $ 1,065,841,206 $ 1,038,412,683 528,697,900 474,450.205 $ 537,143,306 $ 563,962,478 PATENTS -- At cost or nominal value, less accumulated amortization......... PREPAID EXPENSES AND DEFERRED CHARGES TOTAL $ 2,135,713 $ 2,079,582 $ 5,918,656 $ 4,694,612 $ 859,081,341 $ 875,012,430 See Doles to financial statements on pafe 24. 20 SHEET THI DOW CHKMICAL COMPANY AND UMSIOIARV COMPANI LIABILITIES CURRENT LIABILITIES: Notes payable............................................................................ Installments on long-term debt due within one year (Note Dl Accounts payable ..................................................................... United States and foreign taxes on income............................. Accrued and other current liabilities......... ......................... May 31 1959 1958 $ 55,532,713 2,SOO,0OO 33,599,147 37,996,563 38,934,818 $168,563,241 S 31,477.207 4,800,000 35,496,316 26,730,049 36,346,290 $134,849,862 LONG-TERM OEBT (Note D): Promissory notes, 2.7% ..................................... Promissory notes, 3.25%...................................... Debentures, 2.35% ............................................. Debentures, subordinate 3% convertible......... , Debentures, subordinate 4% convertible........... Notes payable--banks.......................................... Mortgage note, 5%--Velasco Magnesium Plant Notes payable--other.......................................... . $ 12,000,000 42.000.000 14.892.000 43.428.000 60.000.000 $172,320,000 3 13,000,000 43.500.000 14.892.000 52.512.000 4,000,000 135,000,000 10.350.000 1,315,789 $274,569,789 MINORITY INTERESTS IN SUBSIDIARY COMPANIES $ 1,391,499 $ 2,206,851 STOCKHOLDERS' INTEREST: Common Capital Stock (outstanding, 26,357,090 shares) l Note ) ..................................................................... Capital surplus..................................................................... Earned surplus ............................... .................................. TOTAL $ 131,785,452 295,789,345 89,231.804 $516,806,601 $859,081,341 $ 129,385,653 276,247,612 57,752,663 $463,385,928 $875,012,430 See notes to financial statements on page 24. ST0 0 04149 21 STATEMENT OF EARNINGS THI DOW CHEMICAL COMPANY AND IUMIDIAIIV COMPANIES T UT0 0 G 50 SALES AND OTHER REVENUE: Net sales ................................................................ Dividends received from associated companies .. Interest income....................................................... Fees from operation of Government-owned plants Other income............................................................ For tho Years Ended May 31 1959 1958 S 705.442.403 S 636,201,143 3,053,259 2330,921 479,686 651,225 3.874.025 425,736 668,227 5.334.973 $713,500,598 $645,161,000 COSTS AND OTHER CHARGES: Cost of sales* .................................................................. Provision for depreciation, amortization, and depletion Provision for pension and profit-sharing plans............. Selling and administrative expenses*............................. Interest expense................................................................ Other income charges....................................................... Minority interests in income of subsidiary companies . . Provision for United States and foreign taxes on income 5 421.946,414 8 386,838.304 82,711,521 82,383,709 9,370,189 8,850,296 66,734,224 66,658,812 9,885,583 10,916,678 6,515,074 696,561 177,577 336,459 53.244,000 42.421,000 $650,584,582 $599,101,819 EARNINGS FOR THE YEAR $ 62,916,016 $ 46,059,181 * Exclusive of items shown separately. See notes to financial statements on page 24. OO 22 STATEMENTS OF SURPLUS THI DOW CHIMICAL COMPANY AND SUBSIDIARY COMPANIIS CAPITAL SURPLUS: For tho Yoor Ended May 31, 1959 ___ Balance, June 1, 1958 ................................................................. 1276,247,612 Additions: Excess of selling price over par value of Common Stock issued to employees ..................................................... 8 7,866,009 Excess of face value of debentures over the par value of Common Stock issued on conversion ........................ 11,638,255 Proceeds received from sale of unclaimed stock scrip .... 37,469 19,541,733 Balance, May 31, 1959 ................................................................. 8295,789,345 EARNED SURPLUS: Balance, June 1, 1958 ................................................................... Earnings for the year..................................................................... Total................................................................................ Cash dividends............................................................. Balance, May 31, 1959 ................................................................ See notes to fintnci&l statements oo pege 24. 8 57,752,663 62,916,016 8120,668,679 31,436,875 8 89,231,804 ST 0 0 0 4 15 1 23 NOTES TO FINANCIAL Principles of Consolidation and Cwvtnion of Foroign Currencies The consolidated financial statements for the year ended May 31. 1959 include the accounts of the Company and all of its domestic and foreign subsidiaries. Under a Plan and Agreement of Reorganization. The Dobeckmun Company was merged into The Dow Chem ical Company as of August 31. 1957. The merger was accounted for as a '`pooling of interests'* and in accord ance therewith the capital and earned surpluses of the respective companies, after certain eliminations, were combined. The accompanying statement of earnings for the year ended May 31, 1958 includes the results of operations of the merged companies for the entire year then ended. (n converting the accounts of Canadian subsidiaries and other items to be settled in Canadian currency, the current assets and liabilities have been converted at par and investments and fixed assets have been con verted at the approximate rate prevailing at the time of acquisition, when below par. The accounts of other foreign subsidiaries have been converted generally at official or other appropriate exchange rates. B Associated Companies The Company's equity in the combined net assets of associated companies <509c owned), as shown by their unaudited financial statements, exceeded the Company's investment at cost by approximately (14,500.000 at May 31. 1959. The Company's equity in the combined net income of these companies was approximately S4.800.000 and (2.900.000 for the years ended May 31. 1959 and 1958. respectively. C Solo of Common Stock to Smployoos In October 1958. the Company made an offering of Common Stock to its employees and employees of its subsidiary and associated companies at a price of 555.7.5 a share, payable on an instalment basis gen erally through payroll deductions. At May 31. 1959 there wore unfilled subscriptions under the offer for 96.895 shares. The subscriptions, which may be canceled at any lime at the option of the employee but must be settled by August 1959. have not been recorded in the Company's books and are not reflected in these financial statements. However, partial payments on the subscrip tions. aggregating 13.525563. are included in current liabilities in the consolidated balance sheet at May 31, 1959. The excess of the quoted market value on dates of delivery of stock sold over the selling price is deductible by the domestic companies in the computation of Fed eral income taxes but it is the practice of the Company not to record such excesses as a charge against income. D Loog-Torm Dob* The promissory notes, which are payable to insurance companies, bear interest at 2.7% and 3.25% per annum, and are due January 1. 1972 and July 1, 1977. respec tively, with prepayments due annually. The 2.35% debentures axe due November 1. 1961. The 3% convertible subordinate debentures are convertible into Common Stock and are due July 1. 1982. Notes payable to banks at May 31, 1959 consisted of indebtedness in the amount of $40,000,000 under a loan agreement which provides for repayment in four equal semi annual instalments beginning July 1, 1960, with interest at 4%% per annum. The remainder, in the amount of $20,000,000, is due under a credit agreement dated October 8, 1952. as amended by supplemental agreement dated October 1, 1957, which provides for a maximum credit of (150.000.000 with interest governed by the prime rate for ninety-day maturities, as defined in the agreement. The Utter borrowing is evidenced by ninety-day notes which are renewable at the option of the borrower with final maturity as of October 1. 1960. B Copitol Stock As of May 31. 1959 the authorized Common Stock con sisted of 50.000,000 shares of (5 par value each. There were 26.357,090 shares outstanding, including scrip for fractional shares aggregating 45 shares. As of that date 96.895 shares were reserved for sale to employees under the offering of October 1958. 980,095 shares were reserved for conversion of convertible debentures, and 188.714 shares were reserved for issuance under the Key Employees Stock Option Flan, under which options were outstanding for 167.255 shares at prices ranging from (53*4 to 187 a share which represented the highest prices of the stock on the New York Stock Exchange on the dales the options were granted. Under the Key CO CJJ cn r*o 24 STATEMENTS Employees Slock Option Plan 142,416 shares were covered by outstanding options at the beginning of the current year. During the current year options for 5079 shares were granted, options covering 32.156 shares were exercised and options for 1.284 shares expired by virtue of termination of employment. There were 78.434 shares available for option but not yet allotted at the beginning of the current year and 21.459 shares available at the end of the current year. F Ranagatiotian Certain contracts and sub-contracts of the Company are subject to Government renegotiation for the purpose of limiting probts. Renegotiation proceedings have been concluded without refund through the year ended May 31. 1958 and in the opinion of officials of the Company no refundable profits have been realixed during the year ended May 31. 1959. Q Commitments and Contingent liabilities It is estimated by the Company that capital expendi tures for the fiscal year ending May 31, 1960 will approximate $60,000,000. The companies have agreed to loan approximately $2,900,000 to associated companies. Other contingent liabilities at May 31. 1959 included guarantees of loans of approximately 115,500,000 for employees* housing, construction of facilities, and other purposes; agree ments for retirement payments to certain officers in a maximum amount of $2,300,000; and guarantees of rental income from housing projects. Certain suits have been started against the Company because of alleged produce damage claims. The Com pany is contesting such suits and the amount of iis ultimate liability thereunder, if any, is not determinable at this time. ST0 0 0 415 3 Scheduled for completion in August 1959, this new Dow ethylene plant is located adjacent to harbor and pipeline facilities at Bay City, Michigan. 25  CH -- ^ 03 N O v> O' tr r rt o CM -- z < l z r-- N 0 0 ir. rsj xS ^ r 1 r- s 5 - a si CM cc ao ^ n * -- i X O' > z < r"" 2 3 JS OXX $s3 P q oo p p j --_ p ** S | 2* S 0 t * i *i St 3 ^ rt I p^ PO p CM p1 s $ c* cm C~M rC--M ^CM <~*} O' O*t' O*5 ^ _ es0 5 * "" ***** CM CM * I* Z < > CM p I QO CM ^ 3 ?i cS R i 55 -- -- -- 30 in ^ m -P ori u uZ * I * & CM t# __ O CM < L Z 0 u r ^CM {<*3i ', co cm ?: I ^ --si 3 3. ! ! 2 =. J * 0 1 Si 2 z 0 i/i a s; & rf*-3 i \~ ) 0 0 n* 8 2 si Ip CM -- I 3 *O' r-- S 4> S rWJ5 pN m|J| crmt & z CO h 2 CQ + qp r*-* Y oo --I CJ Ci < C C u n d tn tr J T rn V e a r S io lf <! o f F I N A N C I A L C O N D I T I O N 31.5 76.6 26.7 155.6 564.0 20.6 740.2 274.6 2.2 26 M I e< 9e cm -- CM -- O mm N yi <<~si 2 < L z 3 2 " - " $ S S0 CM m 5 CM CM l/j M M pOM p ff; N X r* O 5 V u > :_-J K < 0 ca r> r-- ~ <o 3~^~ 00 a t^"*n'Cp*TMp--wp'*O'ine0c-M*0O'inCcCMNpe^j = -S 5 3 O in oo r- eorC4^c4a9r^f^s m s a- ** W -- CM O' a ~ </? O' z < r- in oo o N O N JO O' rt "3 a> IO M T N JO - -- CM m -- z < u*< a. 2 o s in p ifl o >e o ^ e' en oo in -_ s i0 0 ^f- frj ^N Ifl # in eo S 2 : CM T k Si s I J -33-- = *5 ^ < r ^u p CM CO N >fl m iA ao cm <n cm 1 " S CM CM cm" *-' -r lS o' N fl ? N N I* 9 -- s :n 3oi j* z -- in 0 i m in r-. -- en en cm * ggS'-'^-K S S *"! 0* N Cl ^ ^3 l/i' O N N -- CM 0 8 8. 0 X Hs 8 r- O' O' O J M S " 2 - 3Is XX OJ 03 N O 9 erM- ion* seon o--b cm ixn ~^ "? e ^ j *"=' u /) -5 = J; * g/* U j-_r .. = a-5 W u,= - Ow Js * Z = u .r Con<fi-nae<f Ten T e a r Sl<llem *nl / E A R N I N G S 27 SALES OFFICES YHC DOW CHEMICAL COMPANY Atlanta 3, Georgia, Fulton National Bank Building Boston 14, Man, 520 BoyUton Street Buffalo 2, Now York, 70 Niagara Street Caaidon 2* Now ianoy, 400 Market Street Charlotte 2, North Corefina. 504 Wachovia Bank Building Chicago 44, Illinois, 6000 West Touhy Avenue Cincinnati 4, Ohio, 2330 Victory Parkway Cleveland 13, Ohio, 55 Public Square Dallas 1, Tosas, ISOS Elm Street Dotroit 2, Michigan, Fisher Building Houston 25, Tokos, 6910 Fannin Street las Angulos 17, California, 900 Wilshire Boulevard MinMaprit 3, MiaMMta, 1750 Hennepin Avenue Now Orloanc 12, Louisiana, 1100 Commerce Building Now York 20. Now York, 45 Rockefeller Plaza Now York 1, Now York, 912 Empire State Budding Pittsburgh 22, Pennsylvania, One Gateway Center Si. Louis 5, Missouri, 10 South Brentwood Boulevard Son Francisco 4, California, 350 Sansome Street Seattle 1, Washington, 307 Broad Street DOW CHIMICAI OF CANADA, UMITSD Calgary, Albarta, 433 4th Avenue SW Montreal, Ouohoc, 2055 Peel Street Salat John, Now Brunswick, 115 Prince William Street Toronto 2, Ontario, 600 University Avenue Vancouver 1, British Columbia. 225 Pemberton Building Winnipeg, Manitoba, 232 Portage Avenue West DOW CHIMICAI INTIBNATIONAL liMITKD, S. A. Buenos Airot, Argentina Noag Kong, British Crown Colony Johonnoshurg, Union of South Africa lima, Peru Osaka, Japan Rotterdam, The Netherlands Stockholm, Sweden Sydney, AastraBa Tokyo, Japan Zurich, Swifterland DOW CHEMICAL INTIR-AMERICAN LIMITED Monica CHy, Moxko San Joan, Puerto Rica DOW OUIMICA DO BRASIL. S. A. Sae Paula, Brasil 28 c_r cr STOOO'f 157 MANUFACTURING OPERATIONS Cofifornia, Pittsburgh Seal Beach, Torrance Coloeodo, Rocky Flats Connocticwt, Allyn's Point lllmoii, Madison loukiono, Plaquemine Michifss, Bay City, Ludington, Midland Misiowri, Riverside Ohio. Hanging Rock T*xat, Freeport Virfinia, Williamsburg DIVISION OPERATIONS lay Mfinmg Company, Bay City, Michigan IrtiM Oil 4 Gsi Company, Houston. Texas Pabockman Company, Cleveland, Ohio: Berkeley, California Dswolt, Tulsa, Oklahoma MANUFACTURING AND SERVICE SUBSIDIARIES Adami Papsr Company, Wells River, Vermont lamMswt Pspsro, Int., Bennington, Vermont Cfifft Daw Chomkal Company, Marquette, Michigan Cotmodor, S. A. I. C., Buenos Aires, Argentina Dabsckman Eorspa, N.V., Amsterdam, The Netherlands Pobockmun Franco S. A., 5f. Etienne, France Paw AgrschomkoU limitod, London, England Daw Cbomicat Company (II. K.) UnitW, Windsor-Berks, England Daw Chomical International limitod $. A. (Dowall Division), Caracas, Venezuela Daw Cbamical of Conode, Umitod, Sariu'a, Ontario, Canada Daw Chomia Aktiongotolkchaft, Basel. Switzerland Dowoll of Canada, ltd., Calgary, Alberta, Canada Daw Ouimica Aryontina, S. A, Buenos Aires, Argentina Dow Ouimicfl Moxicona, S. A. do C.V,, Mexico City, .Wrxico Exfrwdors, Inc., Hawthorne, California Hawaiian Extrvdort. Inc., Honolulu, Hawaii im Damincia, S. A. do C. V.. Mexico City, Mexico Nodorlandulw Daw Maotichapp* N. Rotterdam, Tke Netherlands DOMESTIC ASSOCIATED COMPANIES Daw boditcho Chamicel Company, Freeport, Texas Dow Comina Corporation. Midland. Michigan Ethyt-Oow Chemical Company, Freeport. Texas THE DOW CHEMICAL COMPANY MIDLAND, MICHIGAN TBOS. OfttSTOCB JR. 1312 tfOLYHOOD RB. JUDLA2ID, RICH. BULK RATE U S. POSTAGE PAID Permit No 3 Midlord, Michigan 0 1VC0 0J.S9 * DOW