In This Article:
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Net Income: $5 million or $0.14 per unit for Q1 2025.
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Consolidated Net Income: $42 million on consolidated net sales of $238 million.
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Distributable Cash Flow: $5 million or $0.13 per unit for Q1 2025.
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Cash Balance and Investments: $154 million at the end of Q1 2025.
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Long-term Debt: $400 million, with $377 million at the Partnership and $23 million at OpCo.
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Capital Expenditures: $16 million spent by OpCo in Q1 2025.
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Quarterly Distribution: $0.4714 per unit announced for Q1 2025.
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Distribution Growth: 71% increase since the IPO's original minimum quarterly distribution.
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Distribution Coverage Ratio: Approximately 1.1 times since IPO.
Release Date: May 02, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Westlake Chemical Partners LP (NYSE:WLKP) reported a net income of $5 million or $0.14 per unit for the first quarter of 2025.
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The company has maintained 43 consecutive quarterly distributions since its IPO in July 2014, demonstrating a strong track record of reliable distributions.
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WLKP's Ethylene Sales Agreement provides a predictable fee-based cash flow structure, minimizing market volatility and production risk.
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The partnership has a strong balance sheet with a consolidated cash balance and cash investments totaling $154 million.
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WLKP has a conservative leverage ratio of approximately 1 times, indicating strong financial health.
Negative Points
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First quarter 2025 net income was $10 million below the first quarter 2024 due to lower production and sales volume from the planned turnaround at Petro 1.
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Distributable cash flow decreased by $12 million compared to the first quarter of 2024, impacted by lower production and higher maintenance capital expenditures.
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The planned turnaround at Petro 1 resulted in lower production and sales volume, affecting quarterly earnings.
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Global trade tensions have intensified, creating uncertainty for businesses and investors, which could impact future performance.
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Elevated interest rates are weighing on the company's loan obligations, potentially affecting financial performance.
Q & A Highlights
Q: It seems like the financial impact of the Q1 turnaround at Petro 1 was more significant on your quarterly earnings than previous turnarounds. Could you help us understand that? Was it due to the size of the turnaround or any unplanned expenses? A: Steve Bender, CFO: The impact was as planned. The unit was down for February and March, which was expected. The elevated interest rates affecting loan obligations might be a factor you're considering, but the performance was as budgeted.