23 April 2014 22:30 [Source: ICIS news]
HOUSTON (ICIS)--PetroLogistics reported on Wednesday a Q1 net income of $46.7m, down more than 18% from $57.1m reported for the same time last year because of higher propane costs, which it uses as a feedstock to make propylene.
Average propane prices reached $1.30/gal in the first quarter, making up 76% of PetroLogistics's total production costs, the company said.
That compares with average propane prices of 86 cents/gal for the same time last year, making up 70% of total production costs, the company said.
Overall, the average propane-to-propylene spread was 36.2 cents/lb ($798/tonne), compared with 50.4 cents/lb for the same time last year.
As a result, Q1 costs of sales reached $162m, up 42% from $114m for the same time last year.
Sales were $220m during the first quarter, up 5.3% from $209m for the same time last year.
Gross profit was $58.4m, down more than 38% from $94.6m for the same time last year.
One-time charges recorded in Q1 2013 reduced the discrepancy between the net income of that quarter and that of Q1 2014.
Regarding operations, PetroLogistics produced almost 316m lb (143,100 tonnes) of propylene in the first quarter, up 5.7% from 299m in Q1 2013.
The company attributed the increase to better plant operations, which happened after PetroLogistics came out of a turnaround in October. In fact, the plant reached a record daily production rate of 3.94m lb in January and February.
In late March, the company replaced two heat exchangers and made other modifications that should make the plant more reliable and increase production, the company said.
PetroLogistics owns a propane dehydrogenation (PDH) plant that has a capacity of 1.45bn lb/year (658,000 tonnes/year).
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