Corrected: Westlake’s Q4 net income falls sharply to $26.4m on lower prices

21 February 2012 12:19  [Source: ICIS news]

Correction: In the ICIS story headlined “Westlake’s Q4 net income falls sharply to $26.4m on lower prices” dated 21 February 2012, please read in the third paragraph …from $154.5m in the fourth quarter … instead of … from … $105.4m …. A corrected story follows.

(recasts, amending paragraphs one to five)

LONDON (ICIS)--Westlake Chemical’s fourth-quarter net income fell sharply to $26.4m (€20.1m) from $84.1m year on year, primarily as a result of higher feedstock costs, the US polyethylene (PE) and polyvinyl chloride (PVC) producer said on Tuesday. 

Net sales for the fourth quarter were $859.2m – an increase of $63.8m from net sales of $795.4m in the same period of 2010, primarily because of higher sales volumes for PE, styrene and PVC resin as well as higher sales prices for building products and caustic, partially offset by lower building products sales volumes, Westlake said.

Income from operations for the group's olefins segment decreased by $78.6m to $75.9m in the fourth quarter of 2011 from $154.5m in the fourth quarter of 2010 on the back of higher feedstock costs and lower PE sales prices.

Westlake's vinyls segment reported a loss from operations of $19.6m in the fourth quarter of 2011, compared with a loss from operations of $12.4m in the fourth quarter of 2010, because of a decrease in PVC resin margins as higher feedstock costs outpaced sales price increases.

For full-year 2011, Westlake reported a net income of $259.0m, up 17% from 2010, while sales rose 14% year on year to $3.62bn.

Net sales in 2011 increased primarily because of higher sales prices for all its major products and higher sales volumes for PVC resin, partially offset by lower building products sales volumes.

"In 2011, we celebrated our 25th year in business and also achieved the highest earnings in company history, as earnings grew by 17%, driven largely by improved integrated vinyls margins,” said Albert Chao, president and CEO.

“In addition, we announced expansion programmes to increase both our chlorine- and ethane-based ethylene capacity. We believe our integration strategy, coupled with our advantaged feedstock position due to increased US shale gas production, will continue to improve our profitability in both our olefins and vinyls businesses."

($1 = €0.76)

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By: Franco Capaldo
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