Westlake Chemical reports 25.5% surge in Q4 net
Courtesy: Westlake Chemical
For the three months ended December 31, 2015 period, Westlake Chemical Partners reported a 25.58 per cent year over year surge in net income attributable to the Partnership.
Westlake Chemical Partners reported net income attributable to the Partnership of $10.8 million, or $0.40 per limited partner unit, up $2.2 million or 25.58 per cent when compared with fourth quarter of 2014.
“For the fourth quarter of 2015, MLP distributable cash flow was $10.1 million, an increase of $1.6 million compared to the year ago quarter,” a Westlake press release stated.
The increase in net income and MLP distributable cash flow is primarily due to the purchase of an additional 2.7 per cent interest in Westlake Chemical OpCo LP by the Partnership on April 1, 2015.
For the full year 2015, net income attributable to the Partnership was $39.8 million, or $1.47 per limited partner unit, while MLP distributable cash flow for full year of 2015 was $37.7 million.
The board of directors of Westlake Chemical Partners GP LLC, the general partner of the Partnership, announced a quarterly distribution of $0.3080 per unit to be payable on February 26, 2016.
According to the company, the MLP distributable cash flow provided coverage of 1.21x the declared distributions for the fourth quarter 2015.
For full year 2015, MLP distributable cash flow of $37.7 million provided coverage of 1.18x the declared distributions during the year.
“The increase in cash distributions is in line with the Partnership's targeted low double-digit distribution growth,” it observed.
OpCo's sales agreement with Westlake Chemical Corporation is designed to provide for stable and predictable cash flows.
The sales agreement provides that 95 per cent of OpCo's ethylene production is sold to Westlake Chemical Corporation for a cash margin of $0.10 per pound, net of operating costs.
"We are very pleased with the fourth quarter and full year results for 2015, our first full year in operation since our IPO in August 2014,” said CEO Albert Chao.
“While we have seen significant decreases in price of ethylene, OpCo's long-term fixed margin sales agreement with Westlake Chemical Corp, is not subject to the volatility in the oil and ethylene markets,” he added.
The expansion of its Petro 1 facility in Lake Charles, Louisiana, which is planned for completion in the first half of 2016, is expected to add 250 million pounds of ethylene capacity.
In addition, it’s recently announced expansion at its Calvert City facility scheduled for completion in the first half of 2017 and other incremental capacity increases will add 100 million pounds of annual ethylene capacity.
“We believe these projects will allow us to continue on our targeted low double-digit growth rate without the need to purchase any additional interest in OpCo," Chao too observed. (AR)
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