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Update: Westlake Chemical net income falls 39%; Petro 1 expansion on track for 1H

HOUSTON, February 23, 2016 (PCW) -– Westlake Chemical on Tuesday reported its fourth-quarter net income at $111 million, down about 39% from the $183.3 million in the year-ago period.

The company attributed the decline to lower sales prices for all its major products.

Meanwhile, its master limited partnership announced Tuesday the 250 million lb/yr expansion of its Petro 1 facility in Lake Charles is on track to be completed in the first half of the year. During its earnings call Tuesday morning, Westlake executives said the 1.2 billion lb/yr Petro 1 facility will be taken down for an 80-day planned turnaround in the second quarter, during which its production capacity would be expanded.

The 100 million lb/yr expansion of its 450 million lb/yr Calvert City, Kentucky, facility is also on track for completion in 1H 2017.

The turnaround at Lake Charles is expected to impact Westlake’s 2Q income from operations by $35 million in lost production. In the third quarter, another $20 million of negative impact on operations income is expected, which would be related to turnarounds at derivative units at several other plants, executives said.

Westlake Chemical’s olefins segment reported income from operations of $138.7 million in 4Q 2015, down 43% from the $243.6 million seen in 4Q 2014. This was due to lower olefins integrated product margins and costs and lost production from several polyethylene turnarounds.

The vinyls segment reported income from operations of $51.6 million during the quarter, down 22% from the $66.3 million seen in 4Q 2014. The company attributed this to lower sales prices for its major vinyls products. – Samantha Hartke

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