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Westlake posts record quarterly income from operations
09
Aug '14
NYSE-listed Westlake Chemical Corporation posted a record quarterly income from operations of $266.8 million in the second quarter of 2014, up 13% from second quarter of 2013.

Net income for the second quarter of 2014 was $169.4 million, or $1.26 per diluted share, on net sales of $998.6 million, a rise of $23.6 million, or $0.17 per diluted share, compared to net income of $145.8 million, or $1.09 per diluted share, on net sales of $939.0 million in the corresponding quarter of 2013.

Net sales for the second quarter of 2014 increased by $59.6 million compared to net sales for the second quarter of 2013, which Westlake mainly attributed to higher sales prices for most of its major Olefins products and higher sales volumes for polyethylene, styrene and caustic soda.

The higher prices were partially offset by lower sales volumes for PVC resin and ethylene co-products due to the Calvert City complex plan maintenance turnaround in the first quarter and the ethylene plant conversion from propane to ethane feedstock, both of which extended into the second quarter of 2014, respectively.

Income from operations was $266.8 million for the second quarter of 2014 as compared to $235.2 million for the second quarter of 2013. Income from operations for the second quarter of 2014 benefited primarily from improved olefins integrated product margins, as higher sales prices more than offset the increase in feedstock and energy costs, and higher olefins sales volumes.

The second quarter 2014 income from operations was negatively impacted by higher cost inventory that was produced from propane feedstock in the first quarter of 2014 that flowed through cost of sales in the second quarter.

Costs associated with the first quarter 2014 maintenance turnaround and other activities at Calvert City complex that carried over into the second quarter of 2014 and lower PVC resin sales volume in the second quarter of 2014 as compared to the second quarter of 2013, negatively impacted income from operations.

In addition, the second quarter of 2014 was negatively impacted by an unplanned outage at one of its ethylene units in Lake Charles, Louisiana.

EBITDA (earnings before interest expense, income taxes, depreciation and amortization) of $319.9 million for the second quarter of 2014 rose by $44.6 million compared to $275.3 million in the second quarter of 2013.

Albert Chao, President and Chief Executive Officer, said, "Our second quarter results reflect record quarterly income from operations. We continue to benefit from low cost, ethane-based ethylene production that is the result of North American shale oil and gas production, as well as from the increased ethylene capacity from our recent ethylene expansion projects.”

On August 4, Westlake Chemical completed the initial public offering of Westlake Chemical Partners, LP, a master limited partnership (MLP).

Fibre2fashion News Desk - India

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