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Dec 31, 2023
Westlake Q4 2023 Earnings Report
Westlake reported a net loss impacted by non-cash impairment charges and liability claims, while HIP segment showed growth in income from operations.
Key Takeaways
Westlake Corporation reported a challenging fourth quarter with a net loss of $497 million, impacted by significant Identified Items. Excluding these items, the company's net income was $93 million. The Housing and Infrastructure Products segment demonstrated resilience, while the Performance and Essential Materials segment was affected by lower sales prices.
Westlake reported net sales of $2.8 billion and a net loss of $497 million, or $3.86 per share.
Q4 earnings were impacted by a $475 million non-cash impairment charge and a $150 million charge to resolve certain liability claims.
Excluding Identified Items, Q4 net income was $93 million, or $0.72 per share, and EBITDA was $390 million.
Housing and Infrastructure Products segment's income from operations increased year-over-year due to higher sales volume and lower material costs.
Westlake
Westlake
Forward Guidance
Westlake anticipates relatively healthy consumer spending in the U.S. to drive modest growth in HIP segment sales volume and expects no further deterioration in the PEM segment with signs of stabilization in sales prices and volumes.
Positive Outlook
- Relatively healthy consumer spending in the U.S.
- Strong labor market supporting consumer spending.
- Moderating interest rates.
- Signs of stabilization in sales prices and volumes in PEM segment.
- Focus on structural cost improvement in Europe for PEM.
Challenges Ahead
- Global macroeconomic conditions largely unchanged from Q4 2023.
- Continuing weak global industrial and manufacturing activity.
- Sustained high operating costs in Europe.
- Significant imports of material from Asia.
- Potential impact on demand due to recycling initiatives and customers seeking alternatives to polymers.