Westlake Olefins segment income rise in Q4 2007

19 Feb '08

3 min read

Westlake Chemical Corporation reported net income of $18.8 million, or $0.29 per diluted share, for the fourth quarter of 2007. This represents a $4.4 million increase from the fourth quarter of 2006 net income of $14.4 million, or $0.22 per diluted share.

Fourth quarter 2007 net income was favorably impacted by a tax benefit of $8.0 million, or $0.12 per diluted share, related to the reorganization of several subsidiaries.

Fourth quarter 2006 net income was favorably impacted by a tax benefit of $6.5 million, or $0.10 per diluted share related to the resolution of certain tax matters. Sales for the fourth quarter of 2007 were $850.6 million and income from operations for the fourth quarter of 2007 was $20.0 million.

This compares with net sales of $523.9 million and income from operations of $8.5 million in the fourth quarter 2006. The increase in sales is the result of higher polyethylene sales volumes attributable to the November 30, 2006 acquisition of Eastman Chemical's polyethylene business in Longview, Texas and higher sales prices.

The increase in income from operations was due to stronger earnings in the Olefins segment. Higher selling prices and sales volumes for polyethylene were partially offset by higher feedstock costs. In addition, income from operations for the Olefins segment in the fourth quarter 2006 was adversely impacted by an unscheduled outage at one of the ethylene units in Lake Charles, Louisiana resulting from mechanical problems with a compressor that required extended maintenance.

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