First quarter 2014 net income of
EBITDA (earnings before interest expense, income taxes, depreciation and amortization) of
Net cash provided by operating activities was
OLEFINS SEGMENT
The Olefins segment reported income from operations of
Income from operations for the first quarter of 2014 for the Olefins segment of
VINYLS SEGMENT
The Vinyls segment reported an operating loss of
The Vinyls segment reported an operating loss of
The statements in this release and the related teleconference relating to matters that are not historical facts, such as statements regarding the advantageous ethylene cost position our Olefins business has been benefiting from over the past few years and that we expect to continue for the foreseeable future are forward-looking statements. These forward-looking statements are subject to significant risks and uncertainties. Actual results could differ materially, based on factors including, but not limited to: general economic and business conditions; the cyclical nature of the chemical industry; availability, cost and volatility of raw materials and utilities, including natural gas from shale production; uncertainties associated with
Westlake Chemical Corporation Conference Call Information:
A conference call to discuss
A replay of the conference call will be available beginning four hours after its conclusion until
The conference call will also be available via webcast at: http://phx.corporate-ir.net/phoenix.zhtml?c=180248&p=IROL-EventDetails&EventID= 5133048 and the earnings release can be obtained via the company's web page at: http://www.westlake.com/fw/main/IR_Home_Page-123.html.
WESTLAKE CHEMICAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) |
||||||||
Three Months Ended March 31, |
||||||||
2014 |
2013 |
|||||||
(In thousands of dollars, except per share data) |
||||||||
Net sales |
$ |
1,027,676 |
$ |
864,647 |
||||
Cost of sales |
740,666 |
636,838 |
||||||
Gross profit |
287,010 |
227,809 |
||||||
Selling, general and administrative expenses |
38,955 |
33,754 |
||||||
Income from operations |
248,055 |
194,055 |
||||||
Interest expense |
(9,157) |
(6,281) |
||||||
Other income, net |
2,509 |
3,519 |
||||||
Income before income taxes |
241,407 |
191,293 |
||||||
Provision for income taxes |
83,375 |
67,946 |
||||||
Net income |
$ |
158,032 |
$ |
123,347 |
||||
Earnings per share: (1) |
||||||||
Basic |
$ |
1.18 |
$ |
0.92 |
||||
Diluted |
$ |
1.18 |
$ |
0.92 |
(1) |
On February 14, 2014, our Board of Directors authorized a two-for-one split of our common stock. Stockholders of record as of February 28, 2014 were entitled to one additional share for every share outstanding, which was distributed on March 18, 2014. Per share data for the three months ended March 31, 2013 have been restated to reflect the effect of the stock split. |
WESTLAKE CHEMICAL CORPORATION
CONSOLIDATED BALANCE SHEETS (Unaudited) |
||||||||
March 31, 2014 |
December 31, 2013 |
|||||||
(In thousands of dollars) |
||||||||
ASSETS |
||||||||
Current assets |
||||||||
Cash and cash equivalents |
$ |
532,643 |
$ |
461,301 |
||||
Marketable securities |
243,694 |
239,388 |
||||||
Accounts receivable, net |
421,879 |
428,457 |
||||||
Inventories |
439,009 |
471,879 |
||||||
Other current assets |
50,038 |
48,057 |
||||||
Total current assets |
1,687,263 |
1,649,082 |
||||||
Property, plant and equipment, net |
2,150,643 |
2,088,014 |
||||||
Other assets, net |
334,050 |
323,813 |
||||||
Total assets |
$ |
4,171,956 |
$ |
4,060,909 |
||||
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||||||
Current liabilities (accounts payable and accrued liabilities) |
$ |
359,934 |
$ |
404,858 |
||||
Long-term debt |
763,909 |
763,879 |
||||||
Other liabilities |
479,541 |
473,569 |
||||||
Total liabilities |
1,603,384 |
1,642,306 |
||||||
Stockholders' equity |
2,568,572 |
2,418,603 |
||||||
Total liabilities and stockholders' equity |
$ |
4,171,956 |
$ |
4,060,909 |
WESTLAKE CHEMICAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) |
||||||||
Three Months Ended March 31, |
||||||||
2014 |
2013 |
|||||||
(In thousands of dollars) |
||||||||
Cash flows from operating activities |
||||||||
Net income |
$ |
158,032 |
$ |
123,347 |
||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||
Depreciation and amortization |
45,972 |
35,356 |
||||||
Deferred income taxes |
8,275 |
29,466 |
||||||
Other balance sheet changes |
226 |
(71,917) |
||||||
Net cash provided by operating activities |
212,505 |
116,252 |
||||||
Cash flows from investing activities |
||||||||
Additions to property, plant and equipment |
(110,741) |
(150,784) |
||||||
Proceeds from disposition of assets |
12 |
2 |
||||||
Proceeds from repayment of loan to affiliate |
— |
167 |
||||||
Proceeds from sales and maturities of securities |
30,119 |
124,873 |
||||||
Purchase of securities |
(49,025) |
(94,903) |
||||||
Settlements of derivative instruments |
(409) |
(679) |
||||||
Net cash used for investing activities |
(130,044) |
(121,324) |
||||||
Cash flows from financing activities |
||||||||
Dividends paid |
(16,789) |
(12,553) |
||||||
Proceeds from exercise of stock options |
2,158 |
1,590 |
||||||
Windfall tax benefits from share-based payment arrangements |
3,512 |
3,844 |
||||||
Net cash used for financing activities |
(11,119) |
(7,119) |
||||||
Net increase (decrease) in cash and cash equivalents |
71,342 |
(12,191) |
||||||
Cash and cash equivalents at beginning of period |
461,301 |
790,078 |
||||||
Cash and cash equivalents at end of period |
$ |
532,643 |
$ |
777,887 |
WESTLAKE CHEMICAL CORPORATION
SEGMENT INFORMATION (Unaudited) |
||||||||
Three Months Ended March 31, |
||||||||
2014 |
2013 |
|||||||
(In thousands of dollars) |
||||||||
Net external sales |
||||||||
Olefins |
$ |
722,798 |
$ |
582,845 |
||||
Vinyls |
304,878 |
281,802 |
||||||
$ |
1,027,676 |
$ |
864,647 |
|||||
Income (loss) from operations |
||||||||
Olefins |
$ |
272,333 |
$ |
161,058 |
||||
Vinyls |
(21,114) |
43,663 |
||||||
Corporate and other |
(3,164) |
(10,666) |
||||||
$ |
248,055 |
$ |
194,055 |
|||||
Depreciation and amortization |
||||||||
Olefins |
$ |
26,647 |
$ |
23,346 |
||||
Vinyls |
19,168 |
11,884 |
||||||
Corporate and other |
157 |
126 |
||||||
$ |
45,972 |
$ |
35,356 |
|||||
Other income (expense), net |
||||||||
Olefins |
$ |
1,454 |
$ |
4,010 |
||||
Vinyls |
(34) |
(425) |
||||||
Corporate and other |
1,089 |
(66) |
||||||
$ |
2,509 |
$ |
3,519 |
WESTLAKE CHEMICAL CORPORATION
RECONCILIATION OF EBITDA TO NET INCOME AND TO NET CASH PROVIDED BY OPERATING ACTIVITIES (Unaudited) |
||||||||||||
Three Months Ended December 31, |
Three Months Ended March 31, |
|||||||||||
2013 |
2014 |
2013 |
||||||||||
(In thousands of dollars) |
||||||||||||
EBITDA |
$ |
302,746 |
$ |
296,536 |
$ |
232,930 |
||||||
Less: |
||||||||||||
Provision for income taxes |
87,100 |
83,375 |
67,946 |
|||||||||
Interest expense |
3,161 |
9,157 |
6,281 |
|||||||||
Depreciation and amortization |
41,513 |
45,972 |
35,356 |
|||||||||
Net income |
170,972 |
158,032 |
123,347 |
|||||||||
Changes in operating assets and liabilities |
23,968 |
46,198 |
(36,561) |
|||||||||
Deferred income taxes |
10,289 |
8,275 |
29,466 |
|||||||||
Net cash provided by operating activities |
$ |
205,229 |
$ |
212,505 |
$ |
116,252 |
WESTLAKE CHEMICAL CORPORATION
SUPPLEMENTAL INFORMATION Product Sales Price and Volume Variance by Operating Segments |
||||||||||||
First Quarter 2014 vs. First Quarter 2013 |
First Quarter 2014 vs. Fourth Quarter 2013 |
|||||||||||
Average Sales Price |
Volume |
Average Sales Price |
Volume |
|||||||||
Olefins |
+13.3 |
% |
+10.7 |
% |
+5.2 |
% |
+3.0 |
% |
||||
Vinyls |
+1.7 |
% |
+4.9 |
% |
+5.1 |
% |
+0.9 |
% |
||||
Company |
+9.5 |
% |
+8.8 |
% |
+5.2 |
% |
+2.3 |
% |
Average Quarterly Industry Prices (1) |
||||||||||
Quarter Ended |
||||||||||
March 31, 2013 |
June 30, 2013 |
September 30, 2013 |
December 31, 2013 |
March 31, 2014 |
||||||
Ethane (cents/lb) |
8.7 |
9.2 |
8.4 |
8.8 |
11.4 |
|||||
Propane (cents/lb) |
20.5 |
21.6 |
24.4 |
28.4 |
30.8 |
|||||
Ethylene (cents/lb) (2) |
63.3 |
58.5 |
54.3 |
52.3 |
55.1 |
|||||
Polyethylene (cents/lb) (3) |
97.3 |
100.0 |
101.7 |
105.0 |
107.7 |
|||||
Styrene (cents/lb) (4) |
85.9 |
81.8 |
83.2 |
81.8 |
86.9 |
|||||
Caustic soda ($/short ton) (5) |
602.5 |
625.8 |
605.8 |
582.5 |
579.2 |
|||||
Chlorine ($/short ton) (6) |
255.0 |
255.0 |
248.3 |
245.0 |
236.7 |
|||||
PVC (cents/lb) (7) |
59.2 |
62.2 |
61.5 |
60.5 |
66.5 |
(1) |
Industry pricing data was obtained from IHS Chemical. We have not independently verified the data. |
|||
(2) |
Represents average North American spot prices of ethylene over the period as reported by IHS Chemical. |
|||
(3) |
Represents average North American contract prices of polyethylene low density film over the period as reported by IHS Chemical. |
|||
(4) |
Represents average North American contract prices of styrene over the period as reported by IHS Chemical. |
|||
(5) |
Represents average North American undiscounted contract prices of caustic soda over the period as reported by IHS Chemical. |
|||
(6) |
Represents average North American contract prices of chlorine (into chemicals) over the period as reported by IHS Chemical. |
|||
(7) |
Represents average North American contract prices of PVC over the period as reported by IHS Chemical. |
SOURCE
Investors - Steve Bender, or Media - David R. Hansen, (713) 960-9111