Surging profit leads to stock split for Westlake Chemical

By Frank Esposito
Senior Staff Reporter

Published: March 14, 2014 12:48 pm ET
Updated: March 14, 2014 12:54 pm ET

Related to this story

Topics Pipe/Profile/Tubing, Materials Suppliers
Companies & Associations Westlake Polymers Corp.

Robust financial results have led Westlake Chemical Corp. to initiate a 2-for-1 stock split.

The split will take effect March 18 for shareholders of record as of Feb. 28. They will be given one additional share for each share held at that time, officials with Houston-based Westlake said in a recent news release. The firm also is increasing its per-share dividend by 12 percent to 25.2 cents per share on a pre-split basis.

“These actions reflect the financial strength of the company,” President and CEO Albert Chao said in the release.

Westlake’s per-share stock price was near $50 in mid-2012, but it has soared since then as the firm’s profitability has increased, largely due to advantages provided by North American natural gas in the ethane and ethylene supply streams. The price crossed the $100 mark in mid-2013 and passed $130 in early February. It closed near $133 on March 13.

For full-year 2013, Westlake’s profit grew almost 60 percent to more than $610 million, as its sales climbed more than 5 percent to almost $3.8 billion. Sales in 2013 for Westlake’s olefins unit — including polyethylene — grew 2 percent to almost $2.6 billion. The firm’s vinyls unit — including PVC resin and pipe — saw sales increase almost 13 percent to more than $1.2 billion.

Westlake’s PVC pipe unit operates as North American Pipe Corp. That Houston-based business ranked fourth on a recent Plastics News ranking of North American pipe, profile and tubing makers.

In the fourth quarter of 2013, Westlake’s sales volume in pounds grew by almost 13 percent vs. the year-ago period, with olefins volume up 11 percent and vinyls volume up almost 16 percent.

The Chao family owns about 70 percent of stock in Westlake. In late 2012, Albert Chao and his siblings — James Chao and Dorothy Chao Jenkins — each had a net worth of $1.4 billion, largely from their company stock, according to the Bloomberg Billionaires Index. On Feb. 18, Albert Chao sold almost 4,900 shares of Westlake stock for almost $630,000, according to an SEC filing.

Westlake has reinvested in the firm as its good fortune has increased. In early 2013, Westlake paid $175 million in cash for the U.S. PVC pipe and foundation business of French firm Cie. De Saint-Gobain. Westlake also added 230 million pounds of ethylene feedstock at its plant in Lake Charles, La., last year and is adding 180 million pounds of ethylene capacity and almost 200 million pounds of PVC resin capacity at a plant in Calvert City, Ky. Most recently, Westlake on Feb. 19 opened a new 70-employee chlor-alkali plant in Geismar, La.

In early 2013, Albert Chao said that new technical developments in the natural gas industry “make expansion in North America attractive.”


Comments

Surging profit leads to stock split for Westlake Chemical

By Frank Esposito
Senior Staff Reporter

Published: March 14, 2014 12:48 pm ET
Updated: March 14, 2014 12:54 pm ET

Post Your Comments


Back to story


More stories

Image

EPA fines RI polymer company

August 29, 2014 1:20 pm ET

A Rhode Island polymer manufacturer has reached a $60,000 settlement with the U.S. Environmental Protection Agency (EPA) for violating federal clean...    More

Image

Chinese compounders seek market shares, often at the expense of margins

August 29, 2014 10:02 am ET

China's largest compounder, Kingfa Sci. & Tech. Co. Ltd., as well as its more automotive-focused counterparts Shanghai Pret Composites Co. Ltd. and...    More

Image

PP prices rise 5 cents

August 28, 2014 3:59 pm ET

After a one-month break, volatility has returned to the North American polypropylene resin market, with prices increasing by an average of 5 cents...    More

Image

DuPont fined for 2010 chemicals release

August 28, 2014 1:37 pm ET

DuPont Co. has been fined almost $1.3 million for the release of several chemicals — including plastics feedstock phosgene — at its plant ...    More

Image

LyondellBasell to build feedstock plant on Gulf Coast

August 28, 2014 11:05 am ET

LyondellBasell Industries will build a world scale propylene oxide plant on the U.S. Gulf Coast with a capacity of 900,000 metric tons per year.    More

Market Reports

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report analyzes economic and market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as growth strategies being implemented by thermoformed packaging companies.

Learn more

Pipe, Profile & Tubing Extrusion in North America 2014

U.S. demand for extruded plastics is expected to grow by 3 percent in 2014, with PVC remaining the largest segment.

Plastic pipe will post the strongest gains through 2018, continuing to take market share from competing materials in a range of markets.

Our latest market report provides in-depth analysis of current trends and their financial impact on the pipe, profile and tubing extrusion industry in North America.

Learn more

2014 Injection Molding Industry Report

GROWTH, OPPORTUNITY IN SIGHT FOR INJECTION MOLDERS IN 2014

In the wake of the economic turbulence earlier in this decade, molders today find themselves in much better shape. Molders are gaining a competitive advantage by investing in people, equipment and seeking inroads into new markets on a global scale.

Growth in the injection molding industry is going to be driven by low financing costs and a continued move to reshore some business.

Learn more

Upcoming Plastics News Events

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events