Westlake Corporation (NYSE: WLK) reported fourth‑quarter and full‑year 2025 financial results that included net sales of $2.533 billion for the quarter and $11.170 billion for the year, a 9% decline year‑over‑year. Net income attributable to Westlake was a loss of $544 million for the quarter and $1.508 billion for the year, translating to diluted earnings of $4.22 per share for the quarter and $11.70 per share for the year. After excluding one‑time “identified items” such as restructuring charges, plant shutdowns, and a $727 million goodwill impairment, the company’s adjusted net loss was $33 million, or $0.25 per share, for the quarter and $116 million, or $0.90 per share, for the year. Adjusted EBITDA stood at $196 million for the quarter and $1.144 billion for the year, reflecting $511 million in identified items, including $495 million of PEM shutdown expenses and $16 million of HIP restructuring expenses.
The adjusted loss per share of $0.25 beat the analyst consensus estimate of a $1.44 loss per share, a margin of $1.19. The beat was largely driven by disciplined cost management and the successful execution of the company’s three‑pillar profitability improvement plan, which reduced operating expenses and eliminated losses from shuttered assets. The plan’s focus on footprint optimization and plant reliability helped offset the impact of lower sales prices and volumes that drove the overall loss.
Segment performance highlighted a mixed picture. The Performance and Essential Materials (PEM) segment’s EBITDA exceeded expectations, driven by a rebound in polyethylene and PVC resin sales despite lower average prices. In contrast, the Housing and Infrastructure Products (HIP) segment’s EBITDA remained in line with guidance, supported by steady demand for construction‑related chemicals. The company attributed the PEM outperformance to a shift toward higher‑margin product mixes and the successful completion of several shutdowns that reduced variable costs.
Management emphasized the importance of the restructuring effort. CEO Jean‑Marc Gilson said, “Meaningful actions taken in 2025 to optimize footprint, improve plant reliability, and structurally reduce costs are expected to provide earnings improvement in 2026.” He added that the company’s “three‑pillar profitability improvement plan” would deliver an estimated $600 million in EBITDA benefits during 2026, reflecting confidence in the turnaround strategy.
Westlake’s guidance for 2026 signals a positive outlook. The company projects a $600 million EBITDA improvement, supported by a strong cash position of $2.9 billion and an investment‑grade credit rating. The guidance reflects management’s belief that cost‑control initiatives and reduced turnaround costs will translate into higher profitability, while the company remains cautious about ongoing market headwinds such as global overcapacity and volatile feedstock prices.
Investors reacted positively to the results, focusing on the company’s strategic initiatives and optimistic 2026 outlook. The market’s enthusiasm was driven by the company’s ability to maintain a robust cash position, preserve its credit rating, and execute a comprehensive restructuring plan that is expected to generate significant EBITDA benefits in the near term.
The company faces headwinds from global overcapacity in key materials markets and volatile trade policies, which continue to pressure pricing and margins. However, tailwinds such as the long‑term strength of housing fundamentals and the anticipated benefits from the ACI acquisition are expected to support the HIP segment’s performance. Overall, Westlake’s results underscore the company’s resilience and its commitment to improving profitability through disciplined cost management and strategic operational enhancements.
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