Westlake Chemical Corp. — in the midst of a takeover battle for Axiall Corp. — announced mixed results for 2015.
Full-year sales for Houston-based Westlake grew 1 percent to $4.46 billion, but the firm's profit fell almost 5 percent to $646 million. Lower selling prices — particularly for polyethylene and ethylene feedstock — impacted Westlake in 2015.
“In spite of this lower price environment … we benefited from strong demand for our polyethylene and PVC products, as well as from the investments we have made to increase our ethylene and chlor-alkali capacities,” President and CEO Albert Chao said in a Feb. 23 news release.
Westlake's olefins unit (including PE) and vinyls unit (including PVC resin and pipe) traveled in different directions in 2015. Olefins saw sales drop 17 percent, while vinyls sales surged 30 percent. The unit's operating profit followed the same path, with olefins down 26 percent to $747 million and vinyls up almost 80 percent to $254 million.
Olefins — at 50.6 percent in 2015 — had a slightly larger portion of Westlake's total sales than vinyls.
Wall Street reaction to Westlake's fourth-quarter and full-year results was negative, as the firm fell short of expectations. Its per-share stock price was down almost 10 percent to $40.70 in mid-day trading Feb. 23. The price had been around $65 as recently as August.
Westlake remains involved in a takeover battle with rival Axiall of Atlanta. On Jan. 29, Westlake went public with its $2.9 billion offer. Axiall officials fired back on Feb. 11 with a detailed critique of the offer, in which they said Westlake was undervaluing their firm.
Westlake officials returned that volley on Feb. 15 by nominating 10 new members — including plastics veterans Charlie Crew and Randy Woelfel — to Axiall's board of directors.
