Westlake Chemical Corporation (WLK) has reported 10.84 percent fall in profit for the quarter ended Dec. 31, 2016. The company has earned $98.94 million, or $0.76 a share in the quarter, compared with $110.97 million, or $0.84 a share for the same period last year. Revenue during the quarter surged 75.85 percent to $1,735.18 million from $986.77 million in the previous year period. Gross margin for the quarter contracted 771 basis points over the previous year period to 16.22 percent. Total expenses were 91.20 percent of quarterly revenues, up from 81.64 percent for the same period last year. That has resulted in a contraction of 956 basis points in operating margin to 8.80 percent.
Operating income for the quarter was $152.68 million, compared with $181.14 million in the previous year period.
"We are pleased with our earnings for 2016 despite lower sales prices following the decline in global crude oil prices and the impact on earnings due to major planned turnarounds," said Albert Chao, president and chief executive officer. "We continue to benefit from solid demand for our products and, as we entered the new year, a rising price environment for our Olefins and Vinyls products. We believe the global demand trends are favorable for our products and that we are positioned to benefit from improving commodity prices which are supported by the continued recovery in crude oil prices. We are also making significant progress in integrating our recently acquired Axiall business and are working towards achieving the anticipated synergies."
Operating cash flow declinesWestlake Chemical Corporation has generated cash of $833.85 million from operating activities during the year, down 22.71 percent or $244.98 million, when compared with the last year. The company has spent $2,562.80 million cash to meet investing activities during the year as against cash outgo of $1,006.18 million in the last year.
Cash flow from financing activities was $1,533.22 million for the year as against cash outgo of $286.81 million in the last year period.
Cash and cash equivalents stood at $459.45 million as on Dec. 31, 2016, down 30.65 percent or $203.07 million from $662.52 million on Dec. 31, 2015.
Working capital declines
Westlake Chemical Corporation has witnessed a decline in the working capital over the last year. It stood at $1,374.57 million as at Dec. 31, 2016, down 16.82 percent or $277.97 million from $1,652.55 million on Dec. 31, 2015. Current ratio was at 2.33 as on Dec. 31, 2016, down from 4.16 on Dec. 31, 2015.
Debt increases substantially
Westlake Chemical Corporation has witnessed an increase in total debt over the last one year. It stood at $3,828 million as on Dec. 31, 2016, up 404.91 percent or $3,069.85 million from $758.15 million on Dec. 31, 2015. Westlake Chemical Corporation has witnessed an increase in long-term debt over the last one year. Total debt was 35.15 percent of total assets as on Dec. 31, 2016, compared with 13.60 percent on Dec. 31, 2015. Debt to equity ratio was at 0.98 as on Dec. 31, 2016, up from 0.21 as on Dec. 31, 2015. Interest coverage ratio deteriorated to 3.59 for the quarter from 22.94 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
