WLK Earnings Prediction
The chart below shows how WLK performed 10 days before and after its earnings report, based on data from the past quarters. Typically, WLK sees a +0.68% change in stock price 10 days leading up to the earnings, and a +2.77% change 10 days following the report. On the earnings day itself, the stock moves by -0.13%. This data can give you a slight idea of what to expect for the next quarter's release.
WLK Key Earning Data
2024/Q4
Year Over Year
Quarter Over Quarter
Total Revenue
2.84B
0.60%
-8.79%
Gross Margin
10.55%
76.42%
-30.04%
Operating Margin
2.60%
233.33%
-68.22%
Net Margin
0.67%
103.89%
-82.60%
EPS
0.05
101.30%
-93.98%
No Data Available
WLK Earnings Analysis
Westlake Corp Corporation (WLK.N) Earnings Conference Call
Positive
Sales Volume and EBITDA Growth: During the fourth quarter, each of our segments delivered year-over-year sales volume and EBITDA growth.
Sales and EBITDA Increase: We reported sales of $2.8 billion and EBITDA of $416 million, an increase of 7% compared to the fourth quarter of 2023 EBITDA of $390 million.
Sales Volume Growth: Sales volume increased year-over-year in both of our segments, highlighted by a strong 7% growth in HIP driven by continued solid demand for pipe and fittings, and siding and trim.
Volume Growth Drivers: PEM’s volume growth of 1% was driven by export market demand and higher polyethylene production levels, with some lines setting new production records during the quarter.
Cost Savings Achievement: We achieved total cost savings for the year to $170 million, exceeding our target.
Record Income and EBITDA Margin: HIP segment achieved record income from operations of $807 million and a record EBITDA margin of 24%, driven by strong 8% sales volume growth.
New Manufacturing Plant Construction: We began construction on a new PVCO manufacturing plant in Wichita Falls, Texas, to support the continued strong customer adoption of this innovative product.
Shareholder Returns Commitment: We returned approximately $325 million to shareholders through dividends and share repurchases, demonstrating our commitment to rewarding shareholders.
Strong Balance Sheet Position: We finished the year with a solid investment-grade rated balance sheet highlighted by $2.9 billion of cash and cash equivalents, providing flexibility to pursue growth opportunities.
HIP Segment Performance: Our HIP segment did an amazing job growing sales and earnings, demonstrating strength in our brand offerings of building products and broad geographical position across North America.
Negative
Earnings Miss Announcement: Westlake Corporation reported a significant earnings miss, with EPS of $0.06 compared to expectations of $1.04, indicating a substantial shortfall in profitability.
Impairment Charge Impact: The company recorded a non-cash impairment charge of $475 million related to its Epoxy business, which negatively impacted overall financial performance.
Liability Claims Charge: In addition to the impairment charge, Westlake incurred a $150 million charge to resolve certain liability claims, further straining financial results.
Sales Price Decline Impact: The company faced a decline in average sales prices by 10% for core vinyls and epoxy resin, which contributed to a 3% decrease in total sales for the year despite a 7% growth in sales volumes.
FIFO Accounting Impact: The unfavorable pre-tax impact of $64 million or $0.36 per share was noted due to the FIFO accounting method, which suggests potential inefficiencies in inventory management.
Cost Reductions vs. Profitability Challenges: Despite achieving $170 million in cost reductions, the company still faced challenges in maintaining profitability due to external market pressures and legislative changes affecting tax assets.
Global Economic Uncertainties: The ongoing global economic uncertainties were highlighted as a risk factor that could impact demand growth in 2025, indicating potential volatility in future earnings.
WLK FAQs
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WLK Earning Call Sentiment
Westlake Corporation (NYSE:WLK) Q4 2024 Earnings Call Transcript
WLK.N
-1.68%Positive
The earnings call reveals several concerning factors: EPS missed expectations significantly, and total sales declined. Although there were cost reductions and shareholder returns, the guidance suggests margin degradation and conservative EBITDA margins. The Q&A highlights concerns about product mix shifts affecting margins and a cautious outlook for epoxy performance. Despite some positive aspects like strong HIP segment performance, the overall sentiment is negative due to disappointing EPS, sales decline, and cautious future guidance.
