Westlake Corp (WLK) News & EventsWLKWestlake Corp

Westlake Closes Cologne PVC Plant to Improve Profitability

Westlake is taking action to improve profitability by closing its polyvinyl chloride, or PVC, plant in Cologne, Germany, in light of challenging market conditions. Chemical production in Europe continues to face difficult conditions, including weak demand, elevated energy costs and increased import pressure from Asia. Due to its smaller scale and higher logistical burden, the Cologne plant has higher costs than the company's other European PVC sites. The company will continue to serve its customers from its remaining, lower-cost PVC facilities in Germany, including its recently acquired Wilhelmshaven site. The broader global market is also experiencing pricing and cost pressures. In Q3, PVC and polyethylene average prices in North America are lower than Q2 as the price increases initially realized in Q2 following the onset of the Iran conflict have moderated. Furthermore, in its Housing & Infrastructure Products segment, the company has experienced higher freight costs caused by a surge in diesel prices and a moderate decline in sales volume caused by the slowdown in housing activity. In line with these market conditions, Westlake expects sequentially lower financial performance in Q3 vs. Q2. The Cologne facility has annual production capacity of 165K metric tons of PVC per year. In connection with the Cologne closure, Westlake expects to record total pre-tax charges of approximately $205M. Approximately $110M of these cash and non-cash charges are expected to be recorded in 2026, with the remaining portion to be recorded in 2027. The site is expected to cease operations in Q1 2027.

PEM Reports Q2 Revenue of $3.27B, Beating Expectations

Reports Q2 revenue $3.27B, consensus $3.25B. "The significant improvement in PEM's second quarter earnings underscores its substantial leverage to improving global supply-demand fundamentals, driven in part by logistical disruptions in the Strait of Hormuz, as well as the meaningful actions that we took last year to improve PEM earnings through footprint optimization, cost reduction, and reliability improvement. Meanwhile, despite slower North American residential construction activity and accelerating raw material cost inflation, financial results in our HIP segment were solid in the second quarter with EBITDA growth that was driven by a double-digit increase in pipe & fittings sales volume. During the second quarter, we completed the acquisition of a PVC and VCM production site in Wilhelmshaven, Germany, which adds advantaged logistical assets into our European chlorovinyls business," said Jean-Marc Gilson, President and Chief Executive Officer.