Corrected: US Axiall reports large jumps in Q4, 2012 year-on-year net income

12 February 2013 23:41  [Source: ICIS news]

Correction: In the ICIS story headlined "US Axiall reports large jumps in Q4, 2012 year-on-year net income" dated 12 February 2013, please read in the first paragraph …and a $35m year-on-year jump … instead of … and almost a 1,080% year-on-year jump …. A corrected story follows.

HOUSTON (ICIS)--Axiall posted a nearly 109% year-on-year rise in net income for 2012 and a $35m year-on-year jump in Q4 net income, thanks to increased sales volume and decreased full-year cost of sales, the company said on Tuesday.

Net income for 2012 was about $120.6m (€90.5m), up from the previous year’s $57.8m.

Net income for the fourth quarter of 2012 was $32.3m, up from Q4 2011’s loss of $3.3m.

Axiall reported net sales of $3.3bn for 2012, up about 3% from $3.2bn in 2011. Q4 2012 net sales were $784.7m, compared with $673.6m in Q4 2011.

“Our results exceeded our expectations for 2012, in large part due to the most profitable fourth quarter we have had in decades,” said Paul Carrico, president and CEO.

In the chlorovinyls segment, Q4 2012 net sales were $346.4m compared with $321.5m in Q4 2011. Operating income jumped to $77.0m in Q4 2012, compared with operating income of $21.5m in Q4 2011.

The $55.5m increase in operating income was primarily due to lower feedstock costs, higher vinyl resin sales volumes and higher caustic sales prices, Axiall said.

In the aromatics segment, net sales increased to $247.4m for Q4 2012 from $162.4m in 2011, due primarily to higher sales prices and higher sales volumes for all products. The segment recorded operating income of $18.3m in Q4 2012, compared with an operating loss of $3.7m during the same quarter in 2011.

The increase in operating income was primarily due to an inventory holding gain in the fourth quarter of 2012 compared with a large inventory holding loss in the fourth quarter of 2011, as well as higher volumes and sales prices in the fourth quarter of 2012, the company said.

In the building products segment, net sales were $190.8m for Q4 2012, compared with $189.7m for Q4 2011. The net sales increase was driven by increased Canadian sales volume and partially offset by lower sales volume in the US due to the discontinued fence product line.

US-based chlor-alkali producer PPG Industries announced on 28 January that its commodity chemicals business merger with US-based Georgia Gulf has been completed to form Axiall in a $2.1bn deal originally announced in July.

Under the arrangement, PPG separated its wholly-owned commodity chemicals business, Eagle Spinco, and merged it with a subsidiary of Georgia Gulf.

Axiall is expected to be the third-largest chlor-alkali producer and the second-largest vinyl chloride monomer (VCM) producer in North America.

Additional reporting by Ken Fountain

($1 = €0.75)


By: Jeremy Pafford
+1 713 525 2653



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