Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2019 | Oct. 30, 2019 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2019 | |
Entity File Number | 001-32260 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Westlake Chemical Corporation | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 76-0346924 | |
Entity Address, Address Line One | 2801 Post Oak Boulevard | |
Entity Address, Address Line Two | Suite 600 | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77056 | |
City Area Code | 713 | |
Local Phone Number | 960-9111 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | WLK | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 128,340,050 | |
Entity Central Index Key | 0001262823 | |
Current Fiscal Year End Date | --12-31 | |
Amendment Flag | false |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets | ||
Cash and cash equivalents | $ 1,437 | $ 753 |
Accounts receivable, net | 1,094 | 1,037 |
Inventories | 906 | 1,014 |
Prepaid expenses and other current assets | 45 | 38 |
Total current assets | 3,482 | 2,842 |
Property, plant and equipment, net | 6,842 | 6,595 |
Operating lease right-of-use assets | 417 | 0 |
Goodwill | 1,069 | 1,002 |
Customer relationships, net | 541 | 525 |
Other intangible assets, net | 191 | 134 |
Other assets, net | 565 | 504 |
Total assets | 13,107 | 11,602 |
Current liabilities | ||
Accounts and notes payable | 496 | 507 |
Accrued and other liabilities | 742 | 676 |
Total current liabilities | 1,238 | 1,183 |
Long-term debt, net | 3,424 | 2,668 |
Deferred income taxes | 1,230 | 1,159 |
Pension and other post-retirement benefits | 328 | 337 |
Operating lease liabilities | 330 | 0 |
Other liabilities | 195 | 179 |
Total liabilities | 6,745 | 5,526 |
Stockholders' equity | ||
Preferred stock, $0.01 par value, 50,000,000 shares authorized; no shares issued and outstanding | 0 | 0 |
Common stock, $0.01 par value, 300,000,000 shares authorized;134,651,380 and 134,651,380 shares issued at September 30, 2019 and December 31, 2018, respectively | 1 | 1 |
Common stock, held in treasury, at cost; 6,515,203 and 6,183,125 shares at September 30, 2019 and December 31, 2018, respectively | (396) | (382) |
Additional paid-in capital | 561 | 556 |
Retained earnings | 5,724 | 5,477 |
Accumulated other comprehensive loss | (66) | (62) |
Total Westlake Chemical Corporation stockholders' equity | 5,824 | 5,590 |
Noncontrolling interests | 538 | 486 |
Total equity | 6,362 | 6,076 |
Total liabilities and equity | $ 13,107 | $ 11,602 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
Preferred stock, par value, in dollars per share | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value, in dollars per share | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common Stock [Member] | ||
Common Stock, Shares, Issued | 134,651,380 | 134,651,380 |
Common Stock, Held in Treasury [Member] | ||
Treasury Stock, Shares | 6,515,203 | 6,183,125 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Statement [Abstract] | ||||
Net sales | $ 2,066 | $ 2,255 | $ 6,235 | $ 6,640 |
Cost of sales | 1,695 | 1,716 | 5,225 | 5,007 |
Gross profit | 371 | 539 | 1,010 | 1,633 |
Selling, general and administrative expenses | 110 | 114 | 343 | 337 |
Amortization of intangibles | 27 | 24 | 81 | 75 |
Restructuring, transaction and integration-related costs | 8 | 5 | 32 | 20 |
Income from operations | 226 | 396 | 554 | 1,201 |
Other income (expense) | ||||
Interest expense | (31) | (28) | (89) | (96) |
Other income, net | 21 | 23 | 32 | 53 |
Income before income taxes | 216 | 391 | 497 | 1,158 |
Provision for income taxes | 50 | 73 | 120 | 255 |
Net income | 166 | 318 | 377 | 903 |
Net income attributable to noncontrolling interests | 8 | 10 | 28 | 30 |
Net income attributable to Westlake Chemical Corporation | $ 158 | $ 308 | $ 349 | $ 873 |
Earnings per common share attributable to Westlake Chemical Corporation: | ||||
Basic (in dollars per share) | $ 1.22 | $ 2.36 | $ 2.70 | $ 6.70 |
Diluted (in dollars per share) | $ 1.22 | $ 2.35 | $ 2.69 | $ 6.67 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 128,216,105 | 129,427,328 | 128,408,841 | 129,512,097 |
Diluted (in shares) | 128,552,360 | 130,052,292 | 128,770,944 | 130,183,201 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 166 | $ 318 | $ 377 | $ 903 |
Pension and other post-retirement benefits liability | ||||
Pension and other post-retirement benefits reserves adjustment | 0 | 12 | 0 | 12 |
Income tax provision on pension and other post-retirement benefits liability | 0 | (3) | 0 | (3) |
Foreign Currency Translation Adjustment, by Component [Abstract] | ||||
Foreign currency translation | (9) | 0 | 4 | (43) |
Income tax benefit (provision) on foreign currency translation | (7) | 0 | (9) | 1 |
Other comprehensive income (loss), net of income taxes | (16) | 9 | (5) | (33) |
Comprehensive income | 150 | 327 | 372 | 870 |
Comprehensive income attributable to noncontrolling interests, net of tax of $1 and $1 for the three months ended September 30, 2019 and 2018; and net of tax of $2 and $3 for the nine months ended September 30, 2019 and 2018, respectively | 8 | 10 | 27 | 28 |
Comprehensive income attributable to Westlake Chemical Corporation | $ 142 | $ 317 | $ 345 | $ 842 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Unaudited) OCI Parenthetical - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
OCI Parenthetical [Abstract] | ||||
Other Comprehensive Income (Loss), Tax, Portion Attributable to Noncontrolling Interest | $ 1 | $ 1 | $ 2 | $ 3 |
Consolidated Statements Of Chan
Consolidated Statements Of Changes In Stockholders' Equity Statement - USD ($) $ in Millions | Total | Common Stock [Member] | Common Stock, Held in Treasury [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Noncontrolling Interests [Member] |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Cumulative effect of accounting change | $ 1 | $ 1 | |||||
Beginning balances at Dec. 31, 2017 | 5,369 | $ 1 | $ (302) | $ 555 | 4,613 | $ 7 | $ 495 |
Beginning balance, shares issued at Dec. 31, 2017 | 134,651,380 | ||||||
Beginning balance, Treasury shares at Dec. 31, 2017 | 5,232,875 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to Westlake Chemical Corporation | 287 | ||||||
Net income attributable to noncontrolling interests | 10 | ||||||
Net income | 297 | ||||||
Other comprehensive income (loss) | (2) | (4) | 2 | ||||
Shares issued—stock- based compensation (in shares) | (175,143) | ||||||
Shares issued—stock-based compensation | 6 | $ 10 | (4) | 0 | |||
Stock-based compensation | 4 | 4 | |||||
Dividends declared | (27) | (27) | |||||
Distributions to noncontrolling interests | (7) | (7) | |||||
Ending balances at Mar. 31, 2018 | 5,641 | $ 1 | $ (292) | 555 | 4,874 | 3 | 500 |
Ending balance, shares issued at Mar. 31, 2018 | 134,651,380 | ||||||
Ending balance, Treasury shares at Mar. 31, 2018 | 5,057,732 | ||||||
Beginning balances at Dec. 31, 2017 | 5,369 | $ 1 | $ (302) | 555 | 4,613 | 7 | 495 |
Beginning balance, shares issued at Dec. 31, 2017 | 134,651,380 | ||||||
Beginning balance, Treasury shares at Dec. 31, 2017 | 5,232,875 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to Westlake Chemical Corporation | 873 | ||||||
Net income attributable to noncontrolling interests | 30 | ||||||
Net income | 903 | ||||||
Other comprehensive income (loss) | (33) | ||||||
Ending balances at Sep. 30, 2018 | 6,088 | $ 1 | $ (337) | 562 | 5,400 | (24) | 486 |
Ending balance, shares issued at Sep. 30, 2018 | 134,651,380 | ||||||
Ending balance, Treasury shares at Sep. 30, 2018 | 5,486,164 | ||||||
Beginning balances at Mar. 31, 2018 | 5,641 | $ 1 | $ (292) | 555 | 4,874 | 3 | 500 |
Beginning balance, shares issued at Mar. 31, 2018 | 134,651,380 | ||||||
Beginning balance, Treasury shares at Mar. 31, 2018 | 5,057,732 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to Westlake Chemical Corporation | 278 | ||||||
Net income attributable to noncontrolling interests | 10 | ||||||
Net income | 288 | ||||||
Other comprehensive income (loss) | (40) | (36) | (4) | ||||
Shares issued—stock- based compensation (in shares) | (57,967) | ||||||
Shares issued—stock-based compensation | 2 | $ 3 | (1) | 0 | |||
Stock-based compensation | 4 | 4 | |||||
Dividends declared | (27) | (27) | |||||
Distributions to noncontrolling interests | (22) | (22) | |||||
Ending balances at Jun. 30, 2018 | 5,846 | $ 1 | $ (289) | 558 | 5,125 | (33) | 484 |
Ending balance, shares issued at Jun. 30, 2018 | 134,651,380 | ||||||
Ending balance, Treasury shares at Jun. 30, 2018 | 4,999,765 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to Westlake Chemical Corporation | 308 | 308 | |||||
Net income attributable to noncontrolling interests | 10 | 10 | |||||
Net income | 318 | ||||||
Other comprehensive income (loss) | 9 | 9 | 0 | ||||
Common stock repurchased, shares | 515,853 | ||||||
Common stock, repurchased | (49) | $ (49) | |||||
Shares issued—stock- based compensation (in shares) | (29,454) | ||||||
Shares issued—stock-based compensation | 0 | $ 1 | (1) | 0 | |||
Stock-based compensation | 5 | 5 | |||||
Dividends declared | (33) | (33) | |||||
Distributions to noncontrolling interests | (8) | (8) | |||||
Ending balances at Sep. 30, 2018 | 6,088 | $ 1 | $ (337) | 562 | 5,400 | (24) | 486 |
Ending balance, shares issued at Sep. 30, 2018 | 134,651,380 | ||||||
Ending balance, Treasury shares at Sep. 30, 2018 | 5,486,164 | ||||||
Beginning balances at Dec. 31, 2018 | 6,076 | $ 1 | $ (382) | 556 | 5,477 | (62) | 486 |
Beginning balance, shares issued at Dec. 31, 2018 | 134,651,380 | ||||||
Beginning balance, Treasury shares at Dec. 31, 2018 | 6,183,125 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to Westlake Chemical Corporation | 72 | ||||||
Net income attributable to noncontrolling interests | 10 | ||||||
Net income | 82 | ||||||
Other comprehensive income (loss) | (2) | (2) | 0 | ||||
Shares issued—stock- based compensation (in shares) | (124,052) | ||||||
Shares issued—stock-based compensation | 0 | $ 11 | (8) | (3) | |||
Stock-based compensation | 7 | 7 | |||||
Dividends declared | (33) | (33) | |||||
Distributions to noncontrolling interests | (8) | (8) | |||||
Issuance of Westlake Chemical Partners LP common units | 63 | (2) | 65 | ||||
Ending balances at Mar. 31, 2019 | 6,185 | $ 1 | $ (371) | 553 | 5,513 | (64) | 553 |
Ending balance, shares issued at Mar. 31, 2019 | 134,651,380 | ||||||
Ending balance, Treasury shares at Mar. 31, 2019 | 6,059,073 | ||||||
Beginning balances at Dec. 31, 2018 | 6,076 | $ 1 | $ (382) | 556 | 5,477 | (62) | 486 |
Beginning balance, shares issued at Dec. 31, 2018 | 134,651,380 | ||||||
Beginning balance, Treasury shares at Dec. 31, 2018 | 6,183,125 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to Westlake Chemical Corporation | 349 | ||||||
Net income attributable to noncontrolling interests | 28 | ||||||
Net income | 377 | ||||||
Other comprehensive income (loss) | (5) | ||||||
Ending balances at Sep. 30, 2019 | 6,362 | $ 1 | $ (396) | 561 | 5,724 | (66) | 538 |
Ending balance, shares issued at Sep. 30, 2019 | 134,651,380 | ||||||
Ending balance, Treasury shares at Sep. 30, 2019 | 6,515,203 | ||||||
Beginning balances at Mar. 31, 2019 | 6,185 | $ 1 | $ (371) | 553 | 5,513 | (64) | 553 |
Beginning balance, shares issued at Mar. 31, 2019 | 134,651,380 | ||||||
Beginning balance, Treasury shares at Mar. 31, 2019 | 6,059,073 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to Westlake Chemical Corporation | 119 | ||||||
Net income attributable to noncontrolling interests | 10 | ||||||
Net income | 129 | ||||||
Other comprehensive income (loss) | 13 | 14 | (1) | ||||
Common stock repurchased, shares | 342,740 | ||||||
Common stock, repurchased | (20) | $ (20) | |||||
Shares issued—stock- based compensation (in shares) | (19,173) | ||||||
Shares issued—stock-based compensation | 0 | $ 1 | (1) | 0 | |||
Stock-based compensation | 6 | 6 | |||||
Dividends declared | (32) | (32) | |||||
Distributions to noncontrolling interests | (22) | (22) | |||||
Ending balances at Jun. 30, 2019 | 6,259 | $ 1 | $ (390) | 558 | 5,600 | (50) | 540 |
Ending balance, shares issued at Jun. 30, 2019 | 134,651,380 | ||||||
Ending balance, Treasury shares at Jun. 30, 2019 | 6,382,640 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to Westlake Chemical Corporation | 158 | 158 | |||||
Net income attributable to noncontrolling interests | 8 | 8 | |||||
Net income | 166 | ||||||
Other comprehensive income (loss) | (16) | (16) | 0 | ||||
Common stock repurchased, shares | 174,972 | ||||||
Common stock, repurchased | (10) | $ (10) | |||||
Shares issued—stock- based compensation (in shares) | (42,409) | ||||||
Shares issued—stock-based compensation | 0 | $ 4 | (3) | (1) | |||
Stock-based compensation | 6 | 6 | |||||
Dividends declared | (33) | (33) | |||||
Distributions to noncontrolling interests | (10) | (10) | |||||
Ending balances at Sep. 30, 2019 | $ 6,362 | $ 1 | $ (396) | $ 561 | $ 5,724 | $ (66) | $ 538 |
Ending balance, shares issued at Sep. 30, 2019 | 134,651,380 | ||||||
Ending balance, Treasury shares at Sep. 30, 2019 | 6,515,203 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Cash flows from operating activities | ||
Net income | $ 377 | $ 903 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 525 | 473 |
Stock-based compensation expense | 19 | 16 |
Loss from disposition and write-off of property, plant and equipment | 32 | 26 |
Deferred income taxes | 34 | 74 |
Other losses (gains), net | 4 | (20) |
Changes in operating assets and liabilities | ||
Accounts receivable | (5) | (252) |
Inventories | 136 | (42) |
Prepaid expenses and other current assets | (7) | (3) |
Accounts payable | (49) | 36 |
Accrued and other liabilities | (34) | 9 |
Other, net | (64) | (65) |
Net cash provided by operating activities | 968 | 1,155 |
Cash flows from investing activities | ||
Acquisition of businesses, net of cash acquired | (314) | 0 |
Additions to property, plant and equipment | (604) | (507) |
Additions to investments in unconsolidated subsidiaries | (45) | (63) |
Other, net | 15 | 9 |
Net cash used for investing activities | (948) | (561) |
Cash flows from financing activities | ||
Debt issuance costs | (7) | 0 |
Dividends paid | (98) | (87) |
Distributions to noncontrolling interests | (40) | (37) |
Proceeds from notes payable | 784 | 0 |
Proceeds from notes payable | 13 | 11 |
Proceeds from issuance of Westlake Chemical Partners LP common units | 63 | 0 |
Redemption and repayment of notes payable | (19) | (1,177) |
Repurchase of common stock for treasury | (30) | (49) |
Other | 3 | 8 |
Net cash provided by (used for) financing activities | 669 | (1,331) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (5) | (6) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 684 | (743) |
Cash, cash equivalents and restricted cash at beginning of period | 775 | 1,554 |
Cash, cash equivalents and restricted cash at end of period | $ 1,459 | $ 811 |
Basis of Financial Statements (
Basis of Financial Statements (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Financial Statements | Basis of Financial Statements The accompanying unaudited consolidated interim financial statements were prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the "SEC") for interim periods. Accordingly, certain information and footnotes required for complete financial statements under generally accepted accounting principles in the United States ("U.S. GAAP") have not been included. These interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto of Westlake Chemical Corporation (the "Company") included in the annual report on Form 10-K for the fiscal year ended December 31, 2018 (the " 2018 Form 10-K"), filed with the SEC on February 20, 2019 . These consolidated financial statements have been prepared in conformity with the accounting principles and practices as disclosed in the notes to the consolidated financial statements of the Company for the fiscal year ended December 31, 2018 with the exception of those accounting standards adopted in 2019 as discussed in Note 1. In the opinion of the Company's management, the accompanying unaudited consolidated interim financial statements reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair statement of the Company's financial position as of September 30, 2019 , its results of operations for the three and nine months ended September 30, 2019 and 2018 , and the changes in its cash position for the nine months ended September 30, 2019 and 2018 . Results of operations and changes in cash position for the interim periods presented are not necessarily indicative of the results that will be realized for the fiscal year ending December 31, 2019 or any other interim period. The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities. Actual results could differ from those estimates. Recent Accounting Pronouncements Credit Losses (ASU No. 2016-13) In June 2016, the Financial Accounting Standards Board ("FASB") issued an accounting standards update providing new guidance for the accounting for credit losses on loans and other financial instruments. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. The standard also modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. The accounting standard will be effective for reporting periods beginning after December 15, 2019 and is not expected to have a material impact on the Company's consolidated financial position, results of operations and cash flows. Intangibles - Goodwill and Other (ASU No. 2017-04) In January 2017, the FASB issued an accounting standards update to simplify the subsequent measurement of goodwill. The guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The accounting standard will be effective for reporting periods beginning after December 15, 2019 and is not expected to have a material impact on the Company's consolidated financial position, results of operations and cash flows. Fair Value Measurement (ASU No. 2018-13) In August 2018, the FASB issued an accounting standards update to modify the disclosure requirements on fair value measurements. The amendments are effective for periods beginning after December 15, 2019. An entity is permitted to early adopt any removed or modified disclosures and delay adoption of the additional disclosures until the effective date. Most amendments should be applied retrospectively, but certain amendments will be applied prospectively. The Company is in the process of assessing the impact of the standard on the Company's fair value disclosures. However, the standard is not expected to have an impact on the Company's consolidated financial position, results of operations and cash flows. Recently Adopted Accounting Standards Leases (ASU No. 2016-02) In February 2016, the FASB issued an accounting standards update on lease accounting that supersedes the previously issued leases guidance. The new standard requires lessees to recognize assets and liabilities for all long-term operating leases. An asset is recognized for the right to use an underlying leased asset and a liability is recognized for the obligation to make payments over the lease term. The standard also requires expanded lease disclosures. The standard requires a modified retrospective adoption approach and allows for the election of certain transition expedients. The Company adopted the standard January 1, 2019 using the optional transition method which allows entities to recognize a cumulative adjustment to the opening balance sheet in the period of adoption. The Company elected the package of optional transition expedients and was not required to reassess (1) whether any existing contracts are or contain leases, (2) classification of existing leases as operating or capital or (3) whether initial direct costs for existing leases qualify for capitalization under the new accounting standard. The Company did not elect the use of hindsight to determine the lease term when considering lease renewal or termination options. Additionally, the Company elected to continue accounting for existing land easements under its accounting policies that were in effect prior to adoption of the new lease standard. The following amounts were recorded as a result of adopting the new lease standard on January 1, 2019: Operating Lease Assets and Liabilities Balance Sheet Location Amounts Recorded in the Consolidated Balance Sheet January 1, 2019 Right-of-use assets Operating lease right-of-use assets $ 421 Current lease liabilities Accrued and other liabilities (94 ) Non-current lease liabilities Operating lease liabilities (331 ) Deferred rent Other liabilities 4 |
Financial Instruments (Notes)
Financial Instruments (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Financial Instruments | Financial Instruments Cash Equivalents The Company had $249 and $10 of held-to-maturity securities with original maturities of three months or less, primarily consisting of corporate debt securities, classified as cash equivalents at September 30, 2019 and December 31, 2018 , respectively. The Company's investments in held-to-maturity securities were held at amortized cost, which approximates fair value. Restricted Cash and Cash Equivalents The Company had restricted cash and cash equivalents of $22 and $22 at September 30, 2019 and December 31, 2018 . The Company's restricted cash and cash equivalents are related to balances that are restricted for payment of distributions to certain of the Company's current and former employees and are reflected primarily in other assets, net in the consolidated balance sheets. |
Accounts Receivable (Notes)
Accounts Receivable (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | |
Accounts Receivable | Accounts Receivable Accounts receivable consist of the following: September 30, December 31, Trade customers $ 1,052 $ 969 Related parties 6 6 Allowance for doubtful accounts (21 ) (23 ) 1,037 952 Federal and state taxes 29 57 Other 28 28 Accounts receivable, net $ 1,094 $ 1,037 |
Inventories (Notes)
Inventories (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following: September 30, December 31, Finished products $ 541 $ 657 Feedstock, additives, chemicals and other raw materials 210 203 Materials and supplies 155 154 Inventories $ 906 $ 1,014 |
Leases (Notes)
Leases (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company is obligated under various long-term and short-term operating leases for rail cars, buildings, land and other transportation and storage assets. The Company determines whether an arrangement is, or contains, a lease at contract inception. Some of the Company's arrangements contain both lease and non-lease components. For certain transportation equipment leases, the Company accounts for the lease and non-lease components as a single lease component. The Company records right-of-use assets and corresponding lease liabilities for operating leases with terms greater than one year. Operating lease right-of-use assets and liabilities are recorded at the present value of the fixed lease payments over the life of the lease. The majority of the Company's leases do not provide an implicit rate. Therefore, the Company uses its incremental borrowing rate at lease commencement to measure operating lease right-of-use assets and lease liabilities. Certain of the Company's leases provide for renewal and purchase options. Renewal and purchase options are evaluated at lease commencement and included in the lease term if they are reasonably certain to be exercised. Short-term leases are recognized in rental expense on a straight-line basis over the lease term and are not recorded in the consolidated balance sheets. The Company's finance leases are not material to the consolidated financial statements. Lease related asset and liability balances were as follows: September 30, Operating Leases Right-of-use assets $ 417 Accrued and other liabilities $ 92 Operating lease liabilities 330 Total operating lease liabilities $ 422 Weighted Average Remaining Term (in years) 7 Weighted Average Lease Discount Rate 3.6 % The Company's operating lease cost is comprised of payments related to operating leases recorded in the consolidated balance sheet and short-term rental payments for leases that are not recorded in the consolidated balance sheet. Variable operating lease cost was not material to the consolidated statement of operations for the three and nine months ended September 30, 2019 . The components of operating lease expense were as follows: Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019 Operating lease cost (1) $ 29 $ 85 Short-term lease cost 15 43 Total operating lease cost $ 44 $ 128 _____________ (1) Includes fixed lease payments for operating leases recorded in the consolidated balance sheet. Maturities of lease liabilities were as follows at September 30, 2019 : Operating Leases 2019 (excluding the nine months ended September 30, 2019) $ 28 2020 100 2021 78 2022 64 2023 50 Thereafter 189 Total lease payments 509 Less: imputed interest (87 ) Present value of lease liabilities $ 422 Future lease commitments for operating lease obligations were as follows at December 31, 2018 : Operating Leases 2019 $ 94 2020 89 2021 70 2022 56 2023 42 Thereafter 152 Total lease payments $ 503 Related Party Leases The Company leases certain assets under operating leases with related parties. As of September 30, 2019 , right-of-use assets and the associated operating lease liabilities for related party operating leases were approximately $51 . The Company recognized operating lease cost for fixed lease payments to related parties of $4 and $13 for the three and nine months ended September 30, 2019 , respectively. |
LACC, LLC Joint Venture
LACC, LLC Joint Venture | 9 Months Ended |
Sep. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
LACC, LLC Joint Venture | LACC, LLC Joint Venture In 2015, Eagle US 2 LLC ("Eagle"), a wholly-owned subsidiary of the Company, and Lotte Chemical USA Corporation, a subsidiary of Lotte Chemical Corporation ("Lotte"), formed a joint venture, LACC, LLC ("LACC"), to design, build and operate an ethylene facility with 2.2 billion pounds per year of ethylene production capacity. Pursuant to a contribution and subscription agreement between Eagle and LACC, Eagle contributed $225 to LACC to fund construction costs of the ethylene plant, representing approximately 12% membership interests in LACC. On October 29, 2019, Eagle entered into a securities purchase agreement with Lotte, to purchase at least an additional 34.787% of the membership interests in LACC from Lotte for approximately $817 (the "Transaction"), pursuant to Eagle's exercise of a call option. The closing of the Transaction is subject to the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and customary closing conditions. Eagle may receive additional membership interests in LACC subject to potential adjustments based upon the finalization of an audit and further negotiations between the parties concerning the purchase price. The ethylene plant was built adjacent to the Company's chlor-alkali facility in Lake Charles. During the third quarter of 2019, the ethylene plant began commercial operations. The Company accounts for its investment in LACC under the equity method of accounting. The LACC joint venture is a cost-sharing arrangement between the members of LACC. The members of LACC receive their proportionate shares of ethylene offtake each month and fund cash operating costs, excluding depreciation and amortization. As a result, LACC recognizes net losses equal to depreciation and amortization each period. The Company's equity in losses from LACC, which is equal to its share of depreciation and amortization expenses, is recognized in cost of sales in the consolidated statements of operations. The Company's investment in LACC is recorded as a component of other assets, net in the consolidated balance sheets. The Company's capital contributions to fund its share of capital expenditures are classified within investing activities in the consolidated statements of cash flows. The Company's ethylene offtake from LACC was approximately 55 million pounds during the three months ended September 30, 2019 . Changes in the Company's investment in LACC for the nine months ended September 30, 2019 were as follows: Investment in LACC Balance at December 31, 2018 $ 183 Cash contributions 45 Depreciation and amortization (1 ) Balance at September 30, 2019 $ 227 Services Provided to LACC and Lotte The Company provides certain utilities and other services to LACC and Lotte. Pursuant to a construction and reimbursement agreement, LACC and Lotte agreed to reimburse the Company for construction costs over a 6.5 -year period beginning in 2020. In addition to the reimbursements for construction costs, the Company charges LACC and Lotte certain fixed fees under an operating, maintenance and logistics agreement. The Company accounts for the reimbursement of construction costs and the fixed fees as components of the total transaction price and recognize it ratably in net sales over approximately 25 years . The remaining performance obligations at September 30, 2019 , representing these fixed components of the transaction price, was $61 and $84 |
Goodwill (Notes)
Goodwill (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill The gross carrying amounts and changes in the carrying amount of goodwill for the nine months ended September 30, 2019 were as follows: Olefins Segment Vinyls Segment Total Balances at December 31, 2018 $ 30 $ 972 $ 1,002 Goodwill acquired during the period — 67 67 Effects of changes in foreign exchange rates — — — Balances at September 30, 2019 $ 30 $ 1,039 $ 1,069 The Company performed its annual impairment assessment for the Vinyls reporting units during the second quarter of 2019 and did not identify any impairment. |
Accounts and Notes Payable (Not
Accounts and Notes Payable (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Accounts and Notes Payable [Abstract] | |
Accounts and Notes Payable | Accounts and Notes Payable Accounts and notes payable consist of the following: September 30, December 31, Accounts payable—third parties $ 475 $ 504 Accounts payable to related parties 4 2 Notes payable 17 1 Accounts and notes payable $ 496 $ 507 |
Long-Term Debt (Notes)
Long-Term Debt (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt consists of the following: September 30, 2019 December 31, 2018 Principal Unamortized Discount Net Principal Unamortized Net 3.60% senior notes due 2022 (the "3.60% 2022 Senior Notes") $ 250 $ (1 ) $ 249 $ 250 $ (1 ) $ 249 3.60% senior notes due 2026 (the "3.60% 2026 Senior Notes") 750 (8 ) 742 750 (9 ) 741 Loan related to tax-exempt waste disposal revenue bonds due 2027 11 — 11 11 — 11 6 ½% senior notes due 2029 (the "6 ½% 2029 GO Zone Senior Notes") 100 (1 ) 99 100 (1 ) 99 6 ½% senior notes due 2035 (the "6 ½% 2035 GO Zone Senior Notes") 89 (1 ) 88 89 (1 ) 88 6 ½% senior notes due 2035 (the "6 ½% 2035 IKE Zone Senior Notes") 65 — 65 65 — 65 5.0% senior notes due 2046 (the "5.0% 2046 Senior Notes") 700 (24 ) 676 700 (24 ) 676 4.375% senior notes due 2047 (the "4.375% 2047 Senior Notes") 500 (9 ) 491 500 (9 ) 491 3.50% senior notes due 2032 (the "3.50% 2032 GO Zone Refunding Senior Notes") 250 (1 ) 249 250 (2 ) 248 1.625% senior notes due 2029 (the "1.625% 2029 Senior Notes") 764 (10 ) 754 — — — Total Long-term debt $ 3,479 $ (55 ) $ 3,424 $ 2,715 $ (47 ) $ 2,668 Credit Agreement The Company has a $1,000 revolving credit facility that is scheduled to mature on July 24, 2023 (the "Credit Agreement"). The Credit Agreement bears interest at either (a) LIBOR plus a spread ranging from 1.00% to 1.75% or (b) Alternate Base Rate plus a spread ranging from 0.00% to 0.75% in each case depending on the credit rating of the Company. At September 30, 2019 , the Company had no borrowings outstanding under the Credit Agreement. As of September 30, 2019 , the Company had no outstanding letters of credit and borrowing availability of $1,000 under the Credit Agreement. The Credit Agreement contains certain affirmative and negative covenants, including a quarterly total leverage ratio financial maintenance covenant. As of September 30, 2019 , the Company was in compliance with the total leverage ratio financial maintenance covenant. The Credit Agreement also contains certain events of default and if and for so long as certain events of default have occurred and are continuing, any overdue amounts outstanding under the Credit Agreement will accrue interest at an increased rate, the lenders can terminate their commitments thereunder and payments of any outstanding amounts could be accelerated by the lenders. None of the Company's subsidiaries are required to guarantee the obligations of the Company under the Credit Agreement. The Credit Agreement includes a $150 sub-limit for letters of credit, and any outstanding letters of credit will be deducted from availability under the facility. The Credit Agreement also provides for a discretionary $50 commitment for swingline loans to be provided on a same-day basis. The Company may also increase the size of the facility, in increments of at least $25 , up to a maximum of $500 , subject to certain conditions and if certain lenders agree to commit to such an increase. 1.625% Senior Notes due 2029 On July 17, 2019 , the Company completed the registered public offering of €700 million aggregate principal amount of 1.625% Senior Notes due July 17, 2029 (the " 1.625% 2029 Senior Notes"). The 1.625% 2029 Senior Notes will accrue interest from July 17, 2019 at a rate of 1.625% per annum, payable annually in arrears on July 17 of each year, beginning July 17, 2020. The indenture governing the 1.625% 2029 Senior Notes contains customary events of default and covenants that will restrict the Company and certain of its subsidiaries' ability to (1) incur certain secured indebtedness, (2) engage in certain sale-leaseback transactions and (3) consolidate, merge or transfer all or substantially all of its assets. The Company designated this euro-denominated debt as a non-derivative net investment hedge of a portion of the Company's net investments in euro functional-currency denominated subsidiaries to offset foreign currency fluctuations. As of September 30, 2019 , the Company was in compliance with all of its long-term debt covenants. Unamortized debt issuance costs on long-term debt were $30 and $25 at September 30, 2019 and December 31, 2018 , respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) Changes in accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2019 and 2018 were as follows: Benefits Liability, Net of Tax Cumulative Foreign Currency Exchange, Net of Tax Total Balances at December 31, 2017 $ 43 $ (36 ) $ 7 Other comprehensive income (loss) before reclassifications 20 (40 ) (20 ) Amounts reclassified from accumulated other comprehensive income (loss) (11 ) — (11 ) Net other comprehensive income (loss) attributable to Westlake Chemical Corporation 9 (40 ) (31 ) Balances at September 30, 2018 $ 52 $ (76 ) $ (24 ) Balances at December 31, 2018 $ 27 $ (89 ) $ (62 ) Other comprehensive income (loss) before reclassifications — (4 ) (4 ) Net other comprehensive income (loss) attributable to Westlake Chemical Corporation — (4 ) (4 ) Balances at September 30, 2019 $ 27 $ (93 ) $ (66 ) |
Fair Value Measurements (Notes)
Fair Value Measurements (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company reports certain assets and liabilities at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). Under the accounting guidance for fair value measurements, inputs used to measure fair value are classified in one of three levels: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The Company has financial assets and liabilities subject to fair value measures. These financial assets and liabilities include cash and cash equivalents, accounts receivable, net, accounts payable and long-term debt, all of which are recorded at carrying value. The amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, net and accounts payable approximate their fair value due to the short maturities of these instruments. The Company's long-term debt instruments are publicly-traded. A market approach, based upon quotes from financial reporting services, is used to measure the fair value of the Company's long-term debt. Because the Company's long-term debt instruments may not be actively traded, the inputs used to measure the fair value of the Company's long-term debt are classified as Level 2 inputs within the fair value hierarchy. The carrying and fair values of the Company's long-term debt are summarized in the table below. September 30, 2019 December 31, 2018 Carrying Value Fair Value Carrying Value Fair Value 3.60% 2022 Senior Notes $ 249 $ 255 $ 249 $ 248 3.60% 2026 Senior Notes 742 775 741 692 Loan related to tax-exempt waste disposal revenue bonds due 2027 11 11 11 11 6 ½% 2029 GO Zone Senior Notes 99 104 99 106 6 ½% 2035 GO Zone Senior Notes 88 94 88 95 6 ½% 2035 IKE Zone Senior Notes 65 68 65 69 5.0% 2046 Senior Notes 676 756 676 641 4.375% 2047 Senior Notes 491 493 491 417 3.50% 2032 GO Zone Refunding Senior Notes 249 266 248 233 1.625% 2029 Senior Notes 754 785 — — |
Income Taxes (Notes)
Income Taxes (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The effective income tax rates were 23.1% and 18.7% for the three months ended September 30, 2019 and 2018 , respectively. The effective income tax rate for the three months ended September 30, 2019 was above the statutory rate of 21.0% primarily due to state and foreign taxes. The effective income tax rate for the three months ended September 30, 2018 was below the U.S. federal statutory rate of 21.0% primarily due to certain discrete tax benefit adjustments related to the remeasurement of state deferred tax balances and changes in income tax estimates due to the filing of the Company's 2017 U.S. federal tax return. The effective income tax rates were 24.1% and 22.0% for the nine months ended September 30, 2019 and 2018 , respectively. The effective income tax rate for the nine months ended September 30, 2019 was above the statutory rate of 21.0% primarily due to state and foreign taxes. The effective income tax rate for the nine months ended September 30, 2018 was above the U.S. federal statutory rate of 21.0% primarily due to state and foreign taxes. |
Earnings and Dividends per Shar
Earnings and Dividends per Share (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings and Dividends Per Share [Abstract] | |
Earnings per Share | Earnings and Dividends per Share Earnings per Share The Company has unvested restricted stock units outstanding that are considered participating securities and, therefore, computes basic and diluted earnings per share under the two-class method. The computation of basic earnings per share is based upon the weighted average number of shares of common stock outstanding during each period. Diluted earnings per share includes the effects of certain stock options and performance stock units. Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Net income attributable to Westlake Chemical Corporation $ 158 $ 308 $ 349 $ 873 Less: Net income attributable to participating securities (1 ) (1 ) (2 ) (4 ) Net income attributable to common shareholders $ 157 $ 307 $ 347 $ 869 The following table reconciles the denominator for the basic and diluted earnings per share computations shown in the consolidated statements of operations: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Weighted average common shares—basic 128,216,105 129,427,328 128,408,841 129,512,097 Plus incremental shares from: Assumed exercise of options and vesting of performance stock units 336,255 624,964 362,103 671,104 Weighted average common shares—diluted 128,552,360 130,052,292 128,770,944 130,183,201 Earnings per common share attributable to Westlake Chemical Corporation: Basic $ 1.22 $ 2.36 $ 2.70 $ 6.70 Diluted $ 1.22 $ 2.35 $ 2.69 $ 6.67 Excluded from the computation of diluted earnings per share are options to purchase 805,878 and 172,194 shares of common stock for the three months ended September 30, 2019 and 2018 , respectively, and 564,676 and 143,439 shares of common stock for the nine months ended September 30, 2019 and 2018 , respectively. These options were outstanding during the periods reported but were excluded because the effect of including them would have been antidilutive. Dividends per Share Dividends per common share for the three and nine months ended September 30, 2019 and 2018 were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Dividends per common share $ 0.2625 $ 0.2500 $ 0.7625 $ 0.6700 |
Supplemental Information (Notes
Supplemental Information (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Supplemental Information [Abstract] | |
Supplemental Information | Supplemental Information Accrued and Other Liabilities Accrued and other liabilities were $742 and $676 at September 30, 2019 and December 31, 2018 , respectively. Accrued rebates, which are a component of accrued and other liabilities, were $108 and $125 at September 30, 2019 and December 31, 2018 , respectively. Other than the lease liability disclosed in Note 5, no other component of accrued and other liabilities was more than five percent of total current liabilities. Accrued liabilities with related parties were $26 and $54 at September 30, 2019 and December 31, 2018 , respectively. Restructuring, Transaction and Integration-related Costs For the three months ended September 30, 2019 , the restructuring, transaction and integration-related costs of $8 primarily consisted of restructuring expenses of $3 related to certain Vinyls segment operations and integration-related consulting fees and costs associated with acquisitions of $5 . For the three months ended September 30, 2018 , the restructuring, transaction and integration-related costs of $5 primarily consisted of integration-related consulting fees. For the nine months ended September 30, 2019 , the restructuring, transaction and integration-related costs of $32 primarily consisted of restructuring expenses of $22 related to certain Vinyls segment operations and integration-related consulting fees and costs associated with acquisitions of $10 . The restructuring expenses consisted of charges associated with the write-off of certain assets. For the nine months ended September 30, 2018 , the restructuring, transaction and integration-related costs of $20 primarily consisted of integration-related consulting fees and acquisition costs. Other Income, Net For the three months ended September 30, 2019 , other income, net included income from unconsolidated subsidiaries, an insurance recovery and interest income on cash and cash equivalents of $7 , $5 and $8 , respectively. For the three months ended September 30, 2018 , other income, net included income from pension and postretirement plans (including a one-time settlement gain), income from unconsolidated subsidiaries and interest income on cash and cash equivalents of $16 , $5 and $4 , respectively. For the nine months ended September 30, 2019 , other income, net included income from unconsolidated subsidiaries, an insurance recovery and interest income on cash and cash equivalents of $12 , $5 and $16 , respectively. For the nine months ended September 30, 2018 , other income, net included income from pension and postretirement plans (including a one-time settlement gain), income from unconsolidated subsidiaries, gain on redemption of senior notes and interest income on cash and cash equivalents of $23 , $17 , $6 and $13 , respectively. Non-cash Investing Activity The change in capital expenditure accrual resulted in an increase in additions to property, plant and equipment by $24 for t he nine months ended September 30, 2019 . The change in capital expenditure accrual resulted in a decrease in additions to property, plant and equipment by $8 for the nine months ended September 30, 2018 . Operating Lease Supplemental Cash Flow Supplemental cash flow information related to leases was as follows: Nine Months Ended September 30, 2019 Operating cash flows from operating leases (1) $ 83 Right-of-use assets obtained in exchange for operating lease obligations 70 _____________ (1) Includes cash paid for amounts included in the measurement of operating lease liabilities recorded in the consolidated balance sheets. For the nine months ended September 30, 2019 , finance lease related cash flows used for operating and financing activities were not material to the consolidated statement of cash flows. |
Acquisition (Notes)
Acquisition (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Acquisition | Acquisition NAKAN TM On January 2, 2019, the Company acquired all of the outstanding equity interests in the parent entity of the NAKAN TM global compounding solutions business. NAKAN's products are used in a wide-variety of applications, including in the automotive, building and construction, and medical industries. The closing purchase price of $249 was paid with available cash on hand. The acquisition is being accounted for under the acquisition method of accounting. The assets acquired and liabilities assumed and the results of operations of NAKAN are included in the Vinyls segment. NAKAN's net sales and earnings since the acquisition date were not material to the Company's consolidated statement of operations for the nine months ended September 30, 2019 . The acquisition-related costs recognized in the consolidated statement of operation for the nine months ended September 30, 2019 were not material. The pro forma impact of this business combination has not been presented as it is not material to the Company's consolidated statements of operations for the nine months ended September 30, 2019 and 2018. The following table summarizes the estimated fair value of identified assets acquired and liabilities assumed at the date of acquisition. The preliminary allocation of consideration transferred is based on management's estimates, judgments and assumptions. When determining the fair values of assets acquired and liabilities assumed, management made significant estimates, judgments and assumptions. These estimates, judgments and assumptions are subject to change upon final valuation and should be treated as preliminary values. Management estimated that consideration paid exceeded the fair value of the net assets acquired. Therefore, goodwill of $40 was recorded. The goodwill recognized is primarily attributable to the expected values to be achieved from the acquisition. The information below represents the preliminary purchase price allocation: Cash $ 10 Accounts receivable 53 Inventories 40 Prepaid expenses and other current assets 7 Property, plant and equipment 75 Operating lease right-of-use assets 3 Intangible assets: Customer relationships (weighted average lives of 17 years) 65 Technology (weighted average lives of 14 years) 40 Trade name (life of 15 years) 25 Other assets 12 Total assets acquired 330 Accounts and notes payable 57 Accrued and other liabilities 18 Deferred income taxes 31 Pension and other post-retirement benefits 4 Operating lease liabilities 3 Other long-term liabilities 8 Total liabilities assumed 121 Total identifiable net assets acquired 209 Goodwill 40 Total purchase consideration $ 249 |
Commitments and Contingencies (
Commitments and Contingencies (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is involved in a number of legal and regulatory matters, principally environmental in nature, that are incidental to the normal conduct of its business, including lawsuits, investigations and claims. The outcome of these matters are inherently unpredictable. The Company believes that, in the aggregate, the outcome of all known legal and regulatory matters will not have a material adverse effect on its consolidated financial statements; however, under certain circumstances, if required to recognize costs in a specific period, when combined with other factors, outcomes with respect to such matters may be material to the Company's consolidated statements of operations in such period. The Company's assessment of the potential impact of environmental matters, in particular, is subject to uncertainty due to the complex, ongoing and evolving process of investigation and remediation of such environmental matters, and the potential for technological and regulatory developments. In addition, the impact of evolving claims and programs, such as natural resource damage claims, industrial site reuse initiatives and state remediation programs creates further uncertainty of the ultimate resolution of these matters. The Company anticipates that the resolution of many legal and regulatory matters, and in particular environmental matters, will occur over an extended period of time. The Company and other caustic soda producers were named as defendants in multiple purported class action civil lawsuits filed since March 2019 in the U.S. District Court for the Western District of New York. The lawsuits allege the defendants conspired to fix, raise, maintain and stabilize the price of caustic soda, restrict domestic (U.S.) supply of caustic soda and allocate caustic soda customers. The other defendants named in the lawsuits are Olin Corporation, K.A. Steel Chemicals (a wholly owned subsidiary of Olin), Occidental Petroleum Corporation, Occidental Chemical Corporation d/b/a OxyChem, Shin-Etsu Chemical Co., Ltd., Shintech Incorporated, Formosa Plastics Corporation, and Formosa Plastics Corporation, U.S.A. Each of the lawsuits is filed on behalf of the respective named plaintiff or plaintiffs and a putative class comprised of either direct purchasers or indirect purchasers of caustic soda in the U.S. Plaintiffs seek an unspecified amount of damages and injunctive relief. The Company has already moved to dismiss the majority of the lawsuits filed and plan to file similar motions with respect to the remaining lawsuits. At this time, the Company is not able to estimate the impact, if any, that these lawsuits could have on the Company's consolidated financial statements either in the current period or in future periods. Environmental. As of September 30, 2019 and December 31, 2018 , the Company had reserves for environmental contingencies totaling approximately $46 and $54 , respectively, most of which was classified as noncurrent liabilities. The Company's assessment of the potential impact of these environmental contingencies is subject to considerable uncertainty due to the complex, ongoing and evolving process of investigation and remediation, if necessary, of such environmental contingencies, and the potential for technological and regulatory developments. Calvert City Proceedings. For several years, the Environmental Protection Agency (the "EPA") has been conducting remedial investigation and feasibility studies at the Company's Calvert City, Kentucky facility pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA"). As the current owner of the Calvert City facility, the Company was named by the EPA as a potentially responsible party ("PRP") along with Goodrich Corporation ("Goodrich") and its successor-in-interest, PolyOne Corporation ("PolyOne"). On November 30, 2017, the EPA published a draft Proposed Plan, incorporating by reference an August 2015 draft Remedial Investigation ("RI") report, an October 2017 draft Feasibility Study ("FS") report and a new Technical Impracticability Waiver document dated December 19, 2017. On June 18, 2018, the EPA published an amendment to its Proposed Plan. The amended Proposed Plan describes a final remedy for the onshore portion of the site comprised of a containment wall, targeted treatment and supplemental hydraulic containment. The amended Proposed Plan also describes an interim approach to address the contamination under the river that would include recovery of any mobile contaminants by an extraction well along with further study of the extent of the contamination and potential treatment options. The EPA's estimated cost of implementation is $107 , with an estimated $1 to $3 in annual operation and maintenance ("O&M") costs. In September 2018, the EPA published the Record of Decision ("ROD") for the site, formally selecting the preferred final and interim remedies outlined in the amended Proposed Plan. In October 2018, EPA issued Special Notice letters to the PRPs for the remedial design phase of work under the ROD. In April 2019, the PRPs and the EPA entered into an Administrative Settlement Agreement and Order on Consent for Remedial Design. In October 2019, the PRPs received a special notice letter from the EPA requesting that the parties begin negotiations regarding a Consent Decree for the Remedial Action at the Calvert City site. The Company's allocation of liability for remedial and O&M costs at the Calvert City site, if any, is governed by a series of agreements between the Company, Goodrich and PolyOne. These agreements are the subject of further litigation as described below. In connection with the 1990 and 1997 acquisitions of the Goodrich chemical manufacturing complex in Calvert City, Goodrich agreed to indemnify the Company for any liabilities related to preexisting contamination at the complex. For its part, the Company agreed to indemnify Goodrich for post-closing contamination caused by the Company's operations. The soil and groundwater at the complex, which does not include the Company's nearby PVC facility, had been extensively contaminated by Goodrich's operations. In 1993, Goodrich spun off the predecessor of PolyOne, and that predecessor assumed Goodrich's indemnification obligations relating to preexisting contamination. In 2003, litigation arose among the Company, Goodrich and PolyOne with respect to the allocation of the cost of remediating contamination at the site. The parties settled this litigation in December 2007 and the case was dismissed. In the settlement, the parties agreed that, among other things: (1) PolyOne would pay 100% of the costs (with specified exceptions), net of recoveries or credits from third parties, incurred with respect to environmental issues at the Calvert City site from August 1, 2007 forward; and (2) either the Company or PolyOne might, from time to time in the future (but not more than once every five years), institute an arbitration proceeding to adjust that percentage. In May 2017, PolyOne filed a demand for arbitration. In this proceeding, PolyOne sought to readjust the percentage allocation of future costs and to recover approximately $11 from the Company in reimbursement of previously paid remediation costs. The Company's cross demand for arbitration seeking unreimbursed remediation costs incurred during the relevant period was dismissed from the proceedings when PolyOne made payment in full at the beginning of the arbitration hearing. On July 10, 2018, PolyOne sued the Company in the U.S. District Court for the Western District of Kentucky, and sought to invalidate the arbitration provisions in the parties' 2007 settlement agreement and enjoin the arbitration it had initiated in 2017. On July 30, 2018, the district court refused to enjoin the arbitration and, on January 15, 2019, the court granted the Company's motion to dismiss PolyOne's suit. On February 13, 2019, PolyOne appealed those decisions to the U.S. Court of Appeals for the Sixth Circuit. The court of appeals issued an opinion and final order on September 6, 2019, affirming the district court. The arbitration hearing began in August 2018 and concluded in December 2018. On May 22, 2019, the arbitration panel issued its final award. It determined that PolyOne was responsible for 100% of the allocable costs at issue in the proceeding and that PolyOne would remain responsible for 100% of the costs to operate the existing groundwater remedy at the Calvert City site. In August 2019, PolyOne filed a motion to vacate before the U.S. District Court for the Western District of Kentucky, seeking to invalidate the final award under the Federal Arbitration Act. The Company filed a motion to confirm the final award in that same action. The action is currently pending. At this time, the Company is not able to estimate the impact, if any, that the issuance of the final award in the arbitration proceeding, or any subsequent judicial proceeding, could have on the Company's consolidated financial statements either in the current period or in later periods. Any cash expenditures that the Company might incur in the future with respect to the remediation of contamination at the Calvert City complex would likely be spread out over an extended period. As a result, the Company believes it is unlikely that any remediation costs allocable to it will be material in terms of expenditures made in any individual reporting period. Environmental Remediation: Reasonably Possible Matters. The Company's assessment of the potential impact of environmental contingencies is subject to considerable uncertainty due to the complex, ongoing and evolving process of investigation and remediation, if necessary, of such environmental contingencies, and the potential for technological and regulatory developments. As such, in addition to the amounts currently reserved, the Company may be subject to reasonably possible loss contingencies related to environmental matters in the range of $65 to $130 . |
Segment Information (Notes)
Segment Information (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company operates in two principal operating segments: Olefins and Vinyls. These segments are strategic business units that offer a variety of different products. The Company manages each segment separately as each business requires different technology and marketing strategies. Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Net external sales Olefins Polyethylene $ 315 $ 396 $ 997 $ 1,152 Styrene, feedstock and other 133 145 387 374 Total Olefins 448 541 1,384 1,526 Vinyls PVC, caustic soda and other 1,253 1,372 3,879 4,126 Building products 365 342 972 988 Total Vinyls 1,618 1,714 4,851 5,114 $ 2,066 $ 2,255 $ 6,235 $ 6,640 Intersegment sales Olefins $ 72 $ 136 $ 238 $ 368 Vinyls — — 1 1 $ 72 $ 136 $ 239 $ 369 Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Income (loss) from operations Olefins $ 92 $ 162 $ 211 $ 483 Vinyls 153 251 383 788 Corporate and other (19 ) (17 ) (40 ) (70 ) $ 226 $ 396 $ 554 $ 1,201 Depreciation and amortization Olefins $ 35 $ 35 $ 106 $ 102 Vinyls 141 124 413 362 Corporate and other 2 2 6 9 $ 178 $ 161 $ 525 $ 473 Other income, net Olefins $ 1 $ 1 $ 4 $ 4 Vinyls 12 16 18 32 Corporate and other 8 6 10 17 $ 21 $ 23 $ 32 $ 53 Provision for (benefit from) income taxes Olefins $ 18 $ 34 $ 45 $ 107 Vinyls 31 44 76 174 Corporate and other 1 (5 ) (1 ) (26 ) $ 50 $ 73 $ 120 $ 255 Capital expenditures Olefins $ 25 $ 33 $ 87 $ 81 Vinyls 165 162 511 420 Corporate and other 3 — 6 6 $ 193 $ 195 $ 604 $ 507 A reconciliation of total segment income from operations to consolidated income before income taxes is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Income from operations $ 226 $ 396 $ 554 $ 1,201 Interest expense (31 ) (28 ) (89 ) (96 ) Other income, net 21 23 32 53 Income before income taxes $ 216 $ 391 $ 497 $ 1,158 September 30, December 31, Total assets Olefins $ 2,026 $ 2,024 Vinyls 9,683 8,879 Corporate and other 1,398 699 $ 13,107 $ 11,602 |
Westlake Chemical Partners LP (
Westlake Chemical Partners LP (Notes) | 9 Months Ended |
Sep. 30, 2019 | |
Partners' Capital [Abstract] | |
Westlake Chemical Partners LP | Westlake Chemical Partners LP In 2014, the Company formed Westlake Chemical Partners LP ("WLKP") to operate, acquire and develop ethylene production facilities and related assets. Also in 2014, WLKP completed its initial public offering of 12,937,500 common units. On March 29, 2019, WLKP purchased an additional 4.5% newly issued limited partner interest in Westlake Chemical OpCo LP ("OpCo") for approximately $201 and completed a private placement of 2,940,818 common units at a price of $21.40 per common unit for total proceeds of approximately $63 . TTWF LP, the Company's principal stockholder and a related party, acquired 1,401,869 units out of 2,940,818 common units issued in the private placement. At September 30, 2019 , WLKP had a 22.8% limited partner interest in OpCo, and the Company retained a 77.2% limited partner interest in OpCo and a significant interest in WLKP through the Company's ownership of WLKP's general partner, 40.1% of limited partner interest (consisting of 14,122,230 common units) and incentive distribution rights. |
Subsequent Event
Subsequent Event | 9 Months Ended |
Sep. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Event On October 29, 2019, the Company, through one of its subsidiaries, Eagle US 2 LLC ("Eagle"), entered into a securities purchase agreement with Lotte, to purchase at least an additional 34.787% of the membership interests in LACC from Lotte for approximately $817 pursuant to Eagle's exercise of a call option (the "Transaction"). Prior to the Transaction, Eagle owned approximately 12% of the membership interests in LACC. See Note 7 for additional information. |
Basis of Financial Statements_2
Basis of Financial Statements (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Financial Statements | The accompanying unaudited consolidated interim financial statements were prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the "SEC") for interim periods. Accordingly, certain information and footnotes required for complete financial statements under generally accepted accounting principles in the United States ("U.S. GAAP") have not been included. These interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto of Westlake Chemical Corporation (the "Company") included in the annual report on Form 10-K for the fiscal year ended December 31, 2018 (the " 2018 Form 10-K"), filed with the SEC on February 20, 2019 . These consolidated financial statements have been prepared in conformity with the accounting principles and practices as disclosed in the notes to the consolidated financial statements of the Company for the fiscal year ended December 31, 2018 with the exception of those accounting standards adopted in 2019 as discussed in Note 1. In the opinion of the Company's management, the accompanying unaudited consolidated interim financial statements reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair statement of the Company's financial position as of September 30, 2019 , its results of operations for the three and nine months ended September 30, 2019 and 2018 , and the changes in its cash position for the nine months ended September 30, 2019 and 2018 . Results of operations and changes in cash position for the interim periods presented are not necessarily indicative of the results that will be realized for the fiscal year ending December 31, 2019 or any other interim period. The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities. Actual results could differ from those estimates. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Credit Losses (ASU No. 2016-13) In June 2016, the Financial Accounting Standards Board ("FASB") issued an accounting standards update providing new guidance for the accounting for credit losses on loans and other financial instruments. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. The standard also modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. The accounting standard will be effective for reporting periods beginning after December 15, 2019 and is not expected to have a material impact on the Company's consolidated financial position, results of operations and cash flows. Intangibles - Goodwill and Other (ASU No. 2017-04) In January 2017, the FASB issued an accounting standards update to simplify the subsequent measurement of goodwill. The guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The accounting standard will be effective for reporting periods beginning after December 15, 2019 and is not expected to have a material impact on the Company's consolidated financial position, results of operations and cash flows. Fair Value Measurement (ASU No. 2018-13) In August 2018, the FASB issued an accounting standards update to modify the disclosure requirements on fair value measurements. The amendments are effective for periods beginning after December 15, 2019. An entity is permitted to early adopt any removed or modified disclosures and delay adoption of the additional disclosures until the effective date. Most amendments should be applied retrospectively, but certain amendments will be applied prospectively. The Company is in the process of assessing the impact of the standard on the Company's fair value disclosures. However, the standard is not expected to have an impact on the Company's consolidated financial position, results of operations and cash flows. Recently Adopted Accounting Standards Leases (ASU No. 2016-02) In February 2016, the FASB issued an accounting standards update on lease accounting that supersedes the previously issued leases guidance. The new standard requires lessees to recognize assets and liabilities for all long-term operating leases. An asset is recognized for the right to use an underlying leased asset and a liability is recognized for the obligation to make payments over the lease term. The standard also requires expanded lease disclosures. The standard requires a modified retrospective adoption approach and allows for the election of certain transition expedients. The Company adopted the standard January 1, 2019 using the optional transition method which allows entities to recognize a cumulative adjustment to the opening balance sheet in the period of adoption. The Company elected the package of optional transition expedients and was not required to reassess (1) whether any existing contracts are or contain leases, (2) classification of existing leases as operating or capital or (3) whether initial direct costs for existing leases qualify for capitalization under the new accounting standard. The Company did not elect the use of hindsight to determine the lease term when considering lease renewal or termination options. Additionally, the Company elected to continue accounting for existing land easements under its accounting policies that were in effect prior to adoption of the new lease standard. The following amounts were recorded as a result of adopting the new lease standard on January 1, 2019: Operating Lease Assets and Liabilities Balance Sheet Location Amounts Recorded in the Consolidated Balance Sheet January 1, 2019 Right-of-use assets Operating lease right-of-use assets $ 421 Current lease liabilities Accrued and other liabilities (94 ) Non-current lease liabilities Operating lease liabilities (331 ) Deferred rent Other liabilities 4 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | |
Schedule Of Accounts Receivable | Accounts receivable consist of the following: September 30, December 31, Trade customers $ 1,052 $ 969 Related parties 6 6 Allowance for doubtful accounts (21 ) (23 ) 1,037 952 Federal and state taxes 29 57 Other 28 28 Accounts receivable, net $ 1,094 $ 1,037 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule Of Inventory | Inventories consist of the following: September 30, December 31, Finished products $ 541 $ 657 Feedstock, additives, chemicals and other raw materials 210 203 Materials and supplies 155 154 Inventories $ 906 $ 1,014 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Lease related asset and liability | Lease related asset and liability balances were as follows: September 30, Operating Leases Right-of-use assets $ 417 Accrued and other liabilities $ 92 Operating lease liabilities 330 Total operating lease liabilities $ 422 Weighted Average Remaining Term (in years) 7 Weighted Average Lease Discount Rate 3.6 % |
Lease, Cost | The components of operating lease expense were as follows: Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019 Operating lease cost (1) $ 29 $ 85 Short-term lease cost 15 43 Total operating lease cost $ 44 $ 128 _____________ (1) Includes fixed lease payments for operating leases recorded in the consolidated balance sheet. |
Maturities of Operating Lease Liabilities | Maturities of lease liabilities were as follows at September 30, 2019 : Operating Leases 2019 (excluding the nine months ended September 30, 2019) $ 28 2020 100 2021 78 2022 64 2023 50 Thereafter 189 Total lease payments 509 Less: imputed interest (87 ) Present value of lease liabilities $ 422 |
Schedule of Future Lease Commitments for Operating Leases | Future lease commitments for operating lease obligations were as follows at December 31, 2018 : Operating Leases 2019 $ 94 2020 89 2021 70 2022 56 2023 42 Thereafter 152 Total lease payments $ 503 |
LACC, LLC Joint Venture (Tables
LACC, LLC Joint Venture (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Changes in Investment | Changes in the Company's investment in LACC for the nine months ended September 30, 2019 were as follows: Investment in LACC Balance at December 31, 2018 $ 183 Cash contributions 45 Depreciation and amortization (1 ) Balance at September 30, 2019 $ 227 |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The gross carrying amounts and changes in the carrying amount of goodwill for the nine months ended September 30, 2019 were as follows: Olefins Segment Vinyls Segment Total Balances at December 31, 2018 $ 30 $ 972 $ 1,002 Goodwill acquired during the period — 67 67 Effects of changes in foreign exchange rates — — — Balances at September 30, 2019 $ 30 $ 1,039 $ 1,069 |
Accounts and Notes Payable (Tab
Accounts and Notes Payable (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accounts and Notes Payable [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities | Accounts and notes payable consist of the following: September 30, December 31, Accounts payable—third parties $ 475 $ 504 Accounts payable to related parties 4 2 Notes payable 17 1 Accounts and notes payable $ 496 $ 507 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule Of Long-Term Debt | Long-term debt consists of the following: September 30, 2019 December 31, 2018 Principal Unamortized Discount Net Principal Unamortized Net 3.60% senior notes due 2022 (the "3.60% 2022 Senior Notes") $ 250 $ (1 ) $ 249 $ 250 $ (1 ) $ 249 3.60% senior notes due 2026 (the "3.60% 2026 Senior Notes") 750 (8 ) 742 750 (9 ) 741 Loan related to tax-exempt waste disposal revenue bonds due 2027 11 — 11 11 — 11 6 ½% senior notes due 2029 (the "6 ½% 2029 GO Zone Senior Notes") 100 (1 ) 99 100 (1 ) 99 6 ½% senior notes due 2035 (the "6 ½% 2035 GO Zone Senior Notes") 89 (1 ) 88 89 (1 ) 88 6 ½% senior notes due 2035 (the "6 ½% 2035 IKE Zone Senior Notes") 65 — 65 65 — 65 5.0% senior notes due 2046 (the "5.0% 2046 Senior Notes") 700 (24 ) 676 700 (24 ) 676 4.375% senior notes due 2047 (the "4.375% 2047 Senior Notes") 500 (9 ) 491 500 (9 ) 491 3.50% senior notes due 2032 (the "3.50% 2032 GO Zone Refunding Senior Notes") 250 (1 ) 249 250 (2 ) 248 1.625% senior notes due 2029 (the "1.625% 2029 Senior Notes") 764 (10 ) 754 — — — Total Long-term debt $ 3,479 $ (55 ) $ 3,424 $ 2,715 $ (47 ) $ 2,668 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes in accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2019 and 2018 were as follows: Benefits Liability, Net of Tax Cumulative Foreign Currency Exchange, Net of Tax Total Balances at December 31, 2017 $ 43 $ (36 ) $ 7 Other comprehensive income (loss) before reclassifications 20 (40 ) (20 ) Amounts reclassified from accumulated other comprehensive income (loss) (11 ) — (11 ) Net other comprehensive income (loss) attributable to Westlake Chemical Corporation 9 (40 ) (31 ) Balances at September 30, 2018 $ 52 $ (76 ) $ (24 ) Balances at December 31, 2018 $ 27 $ (89 ) $ (62 ) Other comprehensive income (loss) before reclassifications — (4 ) (4 ) Net other comprehensive income (loss) attributable to Westlake Chemical Corporation — (4 ) (4 ) Balances at September 30, 2019 $ 27 $ (93 ) $ (66 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Summary Of Carrying And Fair Values Of Long-Term Debt | The Company's long-term debt instruments are publicly-traded. A market approach, based upon quotes from financial reporting services, is used to measure the fair value of the Company's long-term debt. Because the Company's long-term debt instruments may not be actively traded, the inputs used to measure the fair value of the Company's long-term debt are classified as Level 2 inputs within the fair value hierarchy. The carrying and fair values of the Company's long-term debt are summarized in the table below. September 30, 2019 December 31, 2018 Carrying Value Fair Value Carrying Value Fair Value 3.60% 2022 Senior Notes $ 249 $ 255 $ 249 $ 248 3.60% 2026 Senior Notes 742 775 741 692 Loan related to tax-exempt waste disposal revenue bonds due 2027 11 11 11 11 6 ½% 2029 GO Zone Senior Notes 99 104 99 106 6 ½% 2035 GO Zone Senior Notes 88 94 88 95 6 ½% 2035 IKE Zone Senior Notes 65 68 65 69 5.0% 2046 Senior Notes 676 756 676 641 4.375% 2047 Senior Notes 491 493 491 417 3.50% 2032 GO Zone Refunding Senior Notes 249 266 248 233 1.625% 2029 Senior Notes 754 785 — — |
Earnings and Dividends per Sh_2
Earnings and Dividends per Share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings and Dividends Per Share [Abstract] | |
Schedule Of Net Income Attributable To Common Stockholders | Diluted earnings per share includes the effects of certain stock options and performance stock units. Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Net income attributable to Westlake Chemical Corporation $ 158 $ 308 $ 349 $ 873 Less: Net income attributable to participating securities (1 ) (1 ) (2 ) (4 ) Net income attributable to common shareholders $ 157 $ 307 $ 347 $ 869 |
Reconciliation Of Denominator For Basic And Diluted Earnings Per Share | The following table reconciles the denominator for the basic and diluted earnings per share computations shown in the consolidated statements of operations: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Weighted average common shares—basic 128,216,105 129,427,328 128,408,841 129,512,097 Plus incremental shares from: Assumed exercise of options and vesting of performance stock units 336,255 624,964 362,103 671,104 Weighted average common shares—diluted 128,552,360 130,052,292 128,770,944 130,183,201 Earnings per common share attributable to Westlake Chemical Corporation: Basic $ 1.22 $ 2.36 $ 2.70 $ 6.70 Diluted $ 1.22 $ 2.35 $ 2.69 $ 6.67 |
Dividends Per Share | Dividends per Share Dividends per common share for the three and nine months ended September 30, 2019 and 2018 were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Dividends per common share $ 0.2625 $ 0.2500 $ 0.7625 $ 0.6700 |
Supplemental Information Operat
Supplemental Information Operating Lease Supplemental Cash Flow (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Operating Lease Supplemental Cash Flow | Operating Lease Supplemental Cash Flow Supplemental cash flow information related to leases was as follows: Nine Months Ended September 30, 2019 Operating cash flows from operating leases (1) $ 83 Right-of-use assets obtained in exchange for operating lease obligations 70 _____________ (1) Includes cash paid for amounts included in the measurement of operating lease liabilities recorded in the consolidated balance sheets. For the nine months ended September 30, 2019 , finance lease related cash flows used for operating and financing activities were not material to the consolidated statement of cash flows. |
Acquisition (Tables)
Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | The information below represents the preliminary purchase price allocation: Cash $ 10 Accounts receivable 53 Inventories 40 Prepaid expenses and other current assets 7 Property, plant and equipment 75 Operating lease right-of-use assets 3 Intangible assets: Customer relationships (weighted average lives of 17 years) 65 Technology (weighted average lives of 14 years) 40 Trade name (life of 15 years) 25 Other assets 12 Total assets acquired 330 Accounts and notes payable 57 Accrued and other liabilities 18 Deferred income taxes 31 Pension and other post-retirement benefits 4 Operating lease liabilities 3 Other long-term liabilities 8 Total liabilities assumed 121 Total identifiable net assets acquired 209 Goodwill 40 Total purchase consideration $ 249 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Reporting Information | Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Net external sales Olefins Polyethylene $ 315 $ 396 $ 997 $ 1,152 Styrene, feedstock and other 133 145 387 374 Total Olefins 448 541 1,384 1,526 Vinyls PVC, caustic soda and other 1,253 1,372 3,879 4,126 Building products 365 342 972 988 Total Vinyls 1,618 1,714 4,851 5,114 $ 2,066 $ 2,255 $ 6,235 $ 6,640 Intersegment sales Olefins $ 72 $ 136 $ 238 $ 368 Vinyls — — 1 1 $ 72 $ 136 $ 239 $ 369 Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Income (loss) from operations Olefins $ 92 $ 162 $ 211 $ 483 Vinyls 153 251 383 788 Corporate and other (19 ) (17 ) (40 ) (70 ) $ 226 $ 396 $ 554 $ 1,201 Depreciation and amortization Olefins $ 35 $ 35 $ 106 $ 102 Vinyls 141 124 413 362 Corporate and other 2 2 6 9 $ 178 $ 161 $ 525 $ 473 Other income, net Olefins $ 1 $ 1 $ 4 $ 4 Vinyls 12 16 18 32 Corporate and other 8 6 10 17 $ 21 $ 23 $ 32 $ 53 Provision for (benefit from) income taxes Olefins $ 18 $ 34 $ 45 $ 107 Vinyls 31 44 76 174 Corporate and other 1 (5 ) (1 ) (26 ) $ 50 $ 73 $ 120 $ 255 Capital expenditures Olefins $ 25 $ 33 $ 87 $ 81 Vinyls 165 162 511 420 Corporate and other 3 — 6 6 $ 193 $ 195 $ 604 $ 507 |
Reconciliation Of Total Segment Income From Operations To Consolidated Income Before Income Taxes | A reconciliation of total segment income from operations to consolidated income before income taxes is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Income from operations $ 226 $ 396 $ 554 $ 1,201 Interest expense (31 ) (28 ) (89 ) (96 ) Other income, net 21 23 32 53 Income before income taxes $ 216 $ 391 $ 497 $ 1,158 |
Total Assets | September 30, December 31, Total assets Olefins $ 2,026 $ 2,024 Vinyls 9,683 8,879 Corporate and other 1,398 699 $ 13,107 $ 11,602 |
Basis of Financial Statements C
Basis of Financial Statements Changes Due to Lease Standard Adoption (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease right-of-use assets | $ 417 | $ 0 | |
Accrued and other liabilities | 92 | ||
Operating lease liabilities | 330 | 0 | |
Other liabilities | $ 195 | $ 179 | |
Accounting Standards Update 2016-02 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease right-of-use assets | $ 421 | ||
Operating lease liabilities | (331) | ||
Accounting Standards Update 2016-02 [Member] | Accrued and Other Liabilities [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Accrued and other liabilities | (94) | ||
Accounting Standards Update 2016-02 [Member] | Other Liabilities [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Other liabilities | $ 4 |
Financial Instruments (Cash Equ
Financial Instruments (Cash Equivalent) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Cash and Cash Equivalents [Abstract] | ||
Debt Securities, Held-to-maturity | $ 249 | $ 10 |
Financial Instruments (Restrict
Financial Instruments (Restricted Cash Equivalents) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Investments, Debt and Equity Securities [Abstract] | ||
Restricted Cash and Cash Equivalents | $ 22 | $ 22 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | ||
Trade customers | $ 1,052 | $ 969 |
Related parties | 6 | 6 |
Allowance for doubtful accounts | (21) | (23) |
Accounts receivable from trade customers, net | 1,037 | 952 |
Federal and state taxes | 29 | 57 |
Other | 28 | 28 |
Accounts receivable, net | $ 1,094 | $ 1,037 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Finished products | $ 541 | $ 657 |
Feedstock, additives, chemicals and other raw materials | 210 | 203 |
Materials and supplies | 155 | 154 |
Inventories | $ 906 | $ 1,014 |
Leases (Details)
Leases (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Assets and Liabilities, Lessee [Abstract] | |||
Operating lease right-of-use assets | $ 417 | $ 417 | $ 0 |
Accrued and other liabilities | 92 | 92 | |
Operating lease liabilities | 330 | 330 | 0 |
Total Operating lease liabilities | $ 422 | $ 422 | |
Weighted Average Remaining Term (in years) | 7 years | 7 years | |
Weighted Average Lease Discount Rate | 3.60% | 3.60% | |
Lease, Cost [Abstract] | |||
Operating Lease, Cost | $ 29 | $ 85 | |
Short-term lease cost | 15 | 43 | |
Total operating lease cost | 44 | 128 | |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |||
2019 (excluding the nine months ended September 30, 2019) | 28 | 28 | |
2020 | 100 | 100 | |
2021 | 78 | 78 | |
2022 | 64 | 64 | |
2023 | 50 | 50 | |
Thereafter | 189 | 189 | |
Total lease payments | 509 | 509 | |
Less: imputed interest | (87) | (87) | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |||
2019 | 94 | ||
2020 | 89 | ||
2021 | 70 | ||
2022 | 56 | ||
2023 | 42 | ||
Thereafter | 152 | ||
Total lease payments | $ 503 | ||
Affiliated Entity | |||
Assets and Liabilities, Lessee [Abstract] | |||
Operating lease right-of-use assets | 51 | 51 | |
Total Operating lease liabilities | 51 | 51 | |
Fixed Lease Payments | Affiliated Entity | |||
Lease, Cost [Abstract] | |||
Operating Lease, Cost | $ 4 | $ 13 |
Leases Related Party Leases (De
Leases Related Party Leases (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Operating Lease, Liability | $ 422 | $ 422 | |
Operating lease right-of-use assets | 417 | 417 | $ 0 |
Operating Lease, Cost | 29 | 85 | |
Affiliated Entity | |||
Operating Lease, Liability | 51 | 51 | |
Operating lease right-of-use assets | 51 | 51 | |
Fixed Lease Payments | Affiliated Entity | |||
Operating Lease, Cost | $ 4 | $ 13 |
LACC, LLC Joint Venture - Narra
LACC, LLC Joint Venture - Narrative (Details) lb in Millions, $ in Millions | Jun. 17, 2015lb | Sep. 30, 2019USD ($)lb | Sep. 30, 2019USD ($) | Oct. 29, 2019USD ($) | Oct. 28, 2019 |
Schedule of Equity Method Investments [Line Items] | |||||
Contributions to affiliates | $ 225 | $ 225 | |||
LACC, LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Proportionate share of production (in lbs) | lb | 55 | ||||
Reimbursement agreement term | 6 years 6 months | ||||
Revenue reimbursement period | 25 years | 25 years | |||
Lotte Chemical Corporation | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Performance obligations transaction price | $ 84 | $ 84 | |||
LACC, LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Performance obligations transaction price | $ 61 | $ 61 | |||
Subsequent Event | LACC, LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Investment ownership percentage | 12.00% | ||||
Equity Method Investment, Ownership Percentage, Option | 34.787% | ||||
Option to Acquire Equity Method Investment | $ 817 | ||||
Affiliated Entity | LACC, LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Plant capacity (in lbs) | lb | 2,200 |
LACC, LLC Joint Venture - Equit
LACC, LLC Joint Venture - Equity Method Investments (Details) - LACC, LLC $ in Millions | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Investments in and Advances to Affiliates, at Fair Value [Roll Forward] | |
Balance at December 31, 2018 | $ 183 |
Cash contributions | 45 |
Depreciation and amortization | (1) |
Balance at September 30, 2019 | $ 227 |
Goodwill (Details)
Goodwill (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Goodwill [Roll Forward] | |
Beginning Balance | $ 1,002 |
Goodwill acquired during the period | 67 |
Effects of changes in foreign exchange rates | 0 |
Ending Balance | 1,069 |
Olefins [Member] | |
Goodwill [Roll Forward] | |
Beginning Balance | 30 |
Goodwill acquired during the period | 0 |
Effects of changes in foreign exchange rates | 0 |
Ending Balance | 30 |
Vinyls [Member] | |
Goodwill [Roll Forward] | |
Beginning Balance | 972 |
Goodwill acquired during the period | 67 |
Effects of changes in foreign exchange rates | 0 |
Ending Balance | $ 1,039 |
Accounts and Notes Payable (Det
Accounts and Notes Payable (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Accounts and Notes Payable [Abstract] | ||
Accounts payable—third parties | $ 475 | $ 504 |
Accounts payable to related parties | 4 | 2 |
Notes payable | 17 | 1 |
Accounts and notes payable | $ 496 | $ 507 |
Long-Term Debt (Schedule of Lon
Long-Term Debt (Schedule of Long-term Debt) (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2019 | Jul. 17, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | |||
Principal Amount | $ 3,479 | $ 2,715 | |
Unamortized Premium (Discount) and Debt Issuance Costs | (55) | (47) | |
Net, Long-term Debt | $ 3,424 | 2,668 | |
Senior Notes [Member] | 3.60% Senior Notes Due 2022 [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument Maturity | 2022 | ||
Stated interest rate (percent) | 3.60% | ||
Principal Amount | $ 250 | 250 | |
Unamortized Premium (Discount) and Debt Issuance Costs | (1) | (1) | |
Net, Long-term Debt | $ 249 | 249 | |
Senior Notes [Member] | 3.6% Senior Notes Due 2026 [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument Maturity | 2026 | ||
Stated interest rate (percent) | 3.60% | ||
Principal Amount | $ 750 | 750 | |
Unamortized Premium (Discount) and Debt Issuance Costs | (8) | (9) | |
Net, Long-term Debt | $ 742 | 741 | |
Senior Notes [Member] | Loan related to tax-exempt waste disposal revenue bonds due 2027 [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument Maturity | 2027 | ||
Principal Amount | $ 11 | 11 | |
Unamortized Premium (Discount) and Debt Issuance Costs | 0 | 0 | |
Net, Long-term Debt | $ 11 | 11 | |
Senior Notes [Member] | 6 1/2% GO Zone Senior Notes Due 2029 [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument Maturity | 2029 | ||
Stated interest rate (percent) | 6.50% | ||
Principal Amount | $ 100 | 100 | |
Unamortized Premium (Discount) and Debt Issuance Costs | (1) | (1) | |
Net, Long-term Debt | $ 99 | 99 | |
Senior Notes [Member] | 2035 GO Zone 6 1/2% Notes [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument Maturity | 2035 | ||
Stated interest rate (percent) | 6.50% | ||
Principal Amount | $ 89 | 89 | |
Unamortized Premium (Discount) and Debt Issuance Costs | (1) | (1) | |
Net, Long-term Debt | $ 88 | 88 | |
Senior Notes [Member] | 2035 IKE Zone 6 1/2% Notes [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument Maturity | 2035 | ||
Stated interest rate (percent) | 6.50% | ||
Principal Amount | $ 65 | 65 | |
Unamortized Premium (Discount) and Debt Issuance Costs | 0 | 0 | |
Net, Long-term Debt | $ 65 | 65 | |
Senior Notes [Member] | 5.0% Senior Notes Due 2046 [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument Maturity | 2046 | ||
Stated interest rate (percent) | 5.00% | ||
Principal Amount | $ 700 | 700 | |
Unamortized Premium (Discount) and Debt Issuance Costs | (24) | (24) | |
Net, Long-term Debt | $ 676 | 676 | |
Senior Notes [Member] | 4.375% Senior Notes Due 2047 [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument Maturity | 2047 | ||
Stated interest rate (percent) | 4.375% | ||
Principal Amount | $ 500 | 500 | |
Unamortized Premium (Discount) and Debt Issuance Costs | (9) | (9) | |
Net, Long-term Debt | $ 491 | 491 | |
Senior Notes [Member] | 3.50% Senior Notes Due 2032 [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument Maturity | 2032 | ||
Stated interest rate (percent) | 3.50% | ||
Principal Amount | $ 250 | 250 | |
Unamortized Premium (Discount) and Debt Issuance Costs | (1) | (2) | |
Net, Long-term Debt | $ 249 | 248 | |
Senior Notes [Member] | 1.625% Senior Notes Due 2029 | |||
Debt Instrument [Line Items] | |||
Debt Instrument Maturity | 2029 | ||
Stated interest rate (percent) | 1.625% | 1.625% | |
Principal Amount | $ 764 | 0 | |
Unamortized Premium (Discount) and Debt Issuance Costs | (10) | 0 | |
Net, Long-term Debt | $ 754 | $ 0 |
Long-Term Debt (Credit Agreemen
Long-Term Debt (Credit Agreement) (Details) - Credit Agreement [Member] - USD ($) $ in Millions | Jul. 24, 2018 | Sep. 30, 2019 |
Line of Credit [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Line of credit permitted increase | $ 25 | |
Line of Credit [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Line of credit permitted increase | 500 | |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Remaining borrowing capacity | $ 1,000 | |
Revolving Credit Facility [Member] | Line of Credit [Member] | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | 1,000 | |
Amount outstanding | 0 | |
Outstanding letters of credit | $ 0 | |
Letter of Credit [Member] | Line of Credit [Member] | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | 150 | |
Swingline Loan [Member] | Line of Credit [Member] | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | $ 50 | |
Alternate Base Rate [Domain] | Revolving Credit Facility [Member] | Line of Credit [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Spread on variable rate | 0.00% | |
Alternate Base Rate [Domain] | Revolving Credit Facility [Member] | Line of Credit [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Spread on variable rate | 0.75% | |
London Interbank Offered Rate (LIBOR) [Member] | Revolving Credit Facility [Member] | Line of Credit [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Spread on variable rate | 1.00% | |
London Interbank Offered Rate (LIBOR) [Member] | Revolving Credit Facility [Member] | Line of Credit [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Spread on variable rate | 1.75% |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) € in Millions, $ in Millions | Sep. 30, 2019USD ($) | Jul. 17, 2019EUR (€) | Dec. 31, 2018USD ($) |
Debt Instrument [Line Items] | |||
Unamortized Debt Issuance Cost | $ | $ 30 | $ 25 | |
Senior Notes [Member] | 1.625% Senior Notes Due 2029 | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Face Amount | € | € 700 | ||
Stated interest rate (percent) | 1.625% | 1.625% |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Schedule of Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | $ 5,590 | |
Ending balance | 5,824 | |
Accumulated Defined Benefit Plans Adjustment Attributable to Parent [Member] | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | 27 | $ 43 |
Other comprehensive income (loss) before reclassifications | 0 | 20 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (11) | |
Net other comprehensive income (loss) attributable to Westlake Chemical Corporation | 0 | 9 |
Ending balance | 27 | 52 |
Accumulated Foreign Currency Adjustment Attributable to Parent [Member] | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | (89) | (36) |
Other comprehensive income (loss) before reclassifications | (4) | (40) |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | |
Net other comprehensive income (loss) attributable to Westlake Chemical Corporation | (4) | (40) |
Ending balance | (93) | (76) |
Accumulated Other Comprehensive Income (Loss) [Member] | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | (62) | 7 |
Other comprehensive income (loss) before reclassifications | (4) | (20) |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (11) | |
Net other comprehensive income (loss) attributable to Westlake Chemical Corporation | (4) | (31) |
Ending balance | $ (66) | $ (24) |
Fair Value Measurements (Summar
Fair Value Measurements (Summary of Carrying and Fair Values of Long Term Debt) (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2019 | Jul. 17, 2019 | Dec. 31, 2018 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt | $ 3,424 | $ 2,668 | |
3.60% Senior Notes Due 2022 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt | $ 249 | 249 | |
Debt Instrument Maturity | 2022 | ||
Stated interest rate (percent) | 3.60% | ||
3.6% Senior Notes Due 2026 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt | $ 742 | 741 | |
Debt Instrument Maturity | 2026 | ||
Stated interest rate (percent) | 3.60% | ||
Loan related to tax-exempt waste disposal revenue bonds due 2027 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt | $ 11 | 11 | |
Debt Instrument Maturity | 2027 | ||
6 1/2% GO Zone Senior Notes Due 2029 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt | $ 99 | 99 | |
Debt Instrument Maturity | 2029 | ||
Stated interest rate (percent) | 6.50% | ||
2035 GO Zone 6 1/2% Notes [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt | $ 88 | 88 | |
Debt Instrument Maturity | 2035 | ||
Stated interest rate (percent) | 6.50% | ||
2035 IKE Zone 6 1/2% Notes [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt | $ 65 | 65 | |
Debt Instrument Maturity | 2035 | ||
Stated interest rate (percent) | 6.50% | ||
5.0% Senior Notes Due 2046 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt | $ 676 | 676 | |
Debt Instrument Maturity | 2046 | ||
Stated interest rate (percent) | 5.00% | ||
4.375% Senior Notes Due 2047 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt | $ 491 | 491 | |
Debt Instrument Maturity | 2047 | ||
Stated interest rate (percent) | 4.375% | ||
3.50% Senior Notes Due 2032 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt | $ 249 | 248 | |
Debt Instrument Maturity | 2032 | ||
Stated interest rate (percent) | 3.50% | ||
1.625% Senior Notes Due 2029 | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt | $ 754 | 0 | |
Debt Instrument Maturity | 2029 | ||
Stated interest rate (percent) | 1.625% | 1.625% | |
Fair Value [Member] | 3.60% Senior Notes Due 2022 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Senior notes | $ 255 | 248 | |
Fair Value [Member] | 3.6% Senior Notes Due 2026 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Senior notes | 775 | 692 | |
Fair Value [Member] | Loan related to tax-exempt waste disposal revenue bonds due 2027 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Senior notes | 11 | 11 | |
Fair Value [Member] | 6 1/2% GO Zone Senior Notes Due 2029 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Senior notes | 104 | 106 | |
Fair Value [Member] | 2035 GO Zone 6 1/2% Notes [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Senior notes | 94 | 95 | |
Fair Value [Member] | 2035 IKE Zone 6 1/2% Notes [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Senior notes | 68 | 69 | |
Fair Value [Member] | 5.0% Senior Notes Due 2046 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Senior notes | 756 | 641 | |
Fair Value [Member] | 4.375% Senior Notes Due 2047 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Senior notes | 493 | 417 | |
Fair Value [Member] | 3.50% Senior Notes Due 2032 [Member] | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Senior notes | 266 | 233 | |
Fair Value [Member] | 1.625% Senior Notes Due 2029 | Senior Notes [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Senior notes | $ 785 | $ 0 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 23.10% | 18.70% | 24.10% | 22.00% |
U.S. federal statutory income tax rate | 21.00% | 21.00% | 21.00% | 21.00% |
Earnings and Dividends per Sh_3
Earnings and Dividends per Share (Schedule of Net Income Attributable to Common Stockholders) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings and Dividends Per Share [Abstract] | ||||
Net income attributable to Westlake Chemical Corporation | $ 158 | $ 308 | $ 349 | $ 873 |
Net income attributable to participating securities | (1) | (1) | (2) | (4) |
Net income attributable to common shareholders | $ 157 | $ 307 | $ 347 | $ 869 |
Earnings and Dividends per Sh_4
Earnings and Dividends per Share (Reconciliation of Denominator for Basic and Diluted Earnings Per Share) (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings and Dividends Per Share [Abstract] | ||||
Weighted average common shares—basic | 128,216,105 | 129,427,328 | 128,408,841 | 129,512,097 |
Weighted Average Number Diluted Shares Outstanding Adjustment | 336,255 | 624,964 | 362,103 | 671,104 |
Weighted average common shares-diluted | 128,552,360 | 130,052,292 | 128,770,944 | 130,183,201 |
Earnings per share attributable to Westlake Chemical Corporation: Basic | $ 1.22 | $ 2.36 | $ 2.70 | $ 6.70 |
Earnings per share attributable to Westlake Chemical Corporation: Diluted | $ 1.22 | $ 2.35 | $ 2.69 | $ 6.67 |
Earnings and Dividends per Sh_5
Earnings and Dividends per Share (Additional Information) (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings and Dividends Per Share [Abstract] | ||||
Number of options excluded from computation of diluted earnings per share | 805,878 | 172,194 | 564,676 | 143,439 |
Earnings and Dividends per Sh_6
Earnings and Dividends per Share Dividends Per Share (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings and Dividends Per Share [Abstract] | ||||
Dividends per common share (in usd per share) | $ 0.2625 | $ 0.2500 | $ 0.7625 | $ 0.6700 |
Supplemental Information (Addit
Supplemental Information (Additional Information) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Accrued and other liabilities | $ 742 | $ 742 | $ 676 | ||
Accrued Rebates, Current | 108 | 108 | 125 | ||
Due to Affiliate, Current | 26 | 26 | $ 54 | ||
Restructuring, transaction and integration-related costs | 8 | $ 5 | 32 | $ 20 | |
Restructuring Charges | 3 | 22 | |||
Pension and postretirement plans settlement gain | 16 | 23 | |||
Income (Loss) from Subsidiaries, Net of Tax | 7 | 5 | 12 | 17 | |
Insurance Recoveries | 5 | 5 | |||
Gain on debt redemption | 6 | ||||
Interest Income, Other | 8 | $ 4 | 16 | 13 | |
Increase (Decrease) in Capital Expenditure Accrual | 24 | $ (8) | |||
Vinyls [Member] | |||||
Business Combination, Acquisition Related Costs | $ 5 | $ 10 |
Supplemental Information (Opera
Supplemental Information (Operating Lease Supplemental Cash Flow) (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Supplemental Cash Flow Elements [Abstract] | |
Operating cash flows from operating leases | $ 83 |
Right-of-use assets obtained in exchange for operating lease obligations | $ 70 |
Acquisition (Details)
Acquisition (Details) - USD ($) $ in Millions | Jan. 02, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 |
Business Acquisition [Line Items] | |||||
Revenues | $ 2,066 | $ 2,255 | $ 6,235 | $ 6,640 | |
Goodwill | 67 | ||||
Customer Relationships [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 17 years | ||||
Technology-Based Intangible Assets [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 14 years | ||||
Trade Names [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 15 years | ||||
Vinyls [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 67 | ||||
NAKAN [Member] | |||||
Business Acquisition [Line Items] | |||||
Payments to Acquire Businesses, Gross | $ 249 | ||||
Cash | 10 | ||||
Accounts receivable | 53 | ||||
Inventories | 40 | ||||
Prepaid expenses and other current assets | 7 | ||||
Property, plant and equipment | 75 | ||||
Operating lease right-of-use assets | 3 | ||||
Other assets | 12 | ||||
Total assets acquired | 330 | ||||
Accounts and notes payable | 57 | ||||
Accrued and other liabilities | 18 | ||||
Deferred income taxes | 31 | ||||
Pension and other post-retirement benefits | 4 | ||||
Operating lease liabilities | 3 | ||||
Other long-term liabilities | 8 | ||||
Total liabilities assumed | 121 | ||||
Total identifiable net assets acquired | 209 | ||||
Goodwill | 40 | ||||
Total purchase consideration | 249 | ||||
NAKAN [Member] | Customer Relationships [Member] | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 65 | ||||
NAKAN [Member] | Technology-Based Intangible Assets [Member] | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 40 | ||||
NAKAN [Member] | Trade Names [Member] | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | $ 25 |
Commitments and Contingencies_2
Commitments and Contingencies (Additional Information) (Detail) - USD ($) $ in Millions | May 22, 2019 | Jun. 18, 2018 | May 31, 2017 | Sep. 30, 2019 | Dec. 31, 2018 |
Environmental Loss Contingencies [Line Items] | |||||
Document Period End Date | Sep. 30, 2019 | ||||
Environmental Loss contingency accrual | $ 46 | $ 54 | |||
Site Contingency, Percentage of Cost Potentially of Other Responsible Parties [Line Items] | 100.00% | ||||
PolyOne [Member] | |||||
Environmental Loss Contingencies [Line Items] | |||||
Site Contingency, Percentage of Cost Potentially of Other Responsible Parties [Line Items] | 100.00% | ||||
PolyOne [Member] | Pending Litigation [Member] | |||||
Environmental Loss Contingencies [Line Items] | |||||
Loss Contingency, Damages Sought, Value | $ 11 | ||||
Minimum [Member] | |||||
Environmental Loss Contingencies [Line Items] | |||||
Environmental Exit Costs, Reasonably Possible Additional Loss | $ 65 | ||||
Maximum [Member] | |||||
Environmental Loss Contingencies [Line Items] | |||||
Environmental Exit Costs, Reasonably Possible Additional Loss | 130 | ||||
Environmental Protection Agency [Member] | Operation and Maintenance [Member] | |||||
Environmental Loss Contingencies [Line Items] | |||||
Environmental Remediation Expense | $ 107 | ||||
Environmental Protection Agency [Member] | Operation and Maintenance [Member] | Minimum [Member] | |||||
Environmental Loss Contingencies [Line Items] | |||||
Environmental Exit Costs, Anticipated Cost | 1 | ||||
Environmental Protection Agency [Member] | Operation and Maintenance [Member] | Maximum [Member] | |||||
Environmental Loss Contingencies [Line Items] | |||||
Environmental Exit Costs, Anticipated Cost | $ 3 |
Segment Information (Additional
Segment Information (Additional Information) (Detail) | 9 Months Ended |
Sep. 30, 2019Segment | |
Segment Reporting [Abstract] | |
Number of segments | 2 |
Segment Information (Segment Re
Segment Information (Segment Reporting Information) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Segment Reporting Information [Line Items] | ||||
Net sales | $ 2,066 | $ 2,255 | $ 6,235 | $ 6,640 |
Income (loss) from operations | 226 | 396 | 554 | 1,201 |
Depreciation and amortization | 178 | 161 | 525 | 473 |
Other income (expense), net | 21 | 23 | 32 | 53 |
Provision for (benefit from) income taxes | 50 | 73 | 120 | 255 |
Additions to property, plant and equipment | 193 | 195 | 604 | 507 |
Operating Segments [Member] | Olefins [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 448 | 541 | 1,384 | 1,526 |
Income (loss) from operations | 92 | 162 | 211 | 483 |
Depreciation and amortization | 35 | 35 | 106 | 102 |
Other income (expense), net | 1 | 1 | 4 | 4 |
Provision for (benefit from) income taxes | 18 | 34 | 45 | 107 |
Additions to property, plant and equipment | 25 | 33 | 87 | 81 |
Operating Segments [Member] | Vinyls [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 1,618 | 1,714 | 4,851 | 5,114 |
Income (loss) from operations | 153 | 251 | 383 | 788 |
Depreciation and amortization | 141 | 124 | 413 | 362 |
Other income (expense), net | 12 | 16 | 18 | 32 |
Provision for (benefit from) income taxes | 31 | 44 | 76 | 174 |
Additions to property, plant and equipment | 165 | 162 | 511 | 420 |
Operating Segments [Member] | Polyethylene [Member] | Olefins [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 315 | 396 | 997 | 1,152 |
Operating Segments [Member] | Styrene, Feedstock And Other [Member] | Olefins [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 133 | 145 | 387 | 374 |
Operating Segments [Member] | PVC, Caustic Soda And Other [Member] | Vinyls [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 1,253 | 1,372 | 3,879 | 4,126 |
Operating Segments [Member] | Building Products [Member] | Vinyls [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 365 | 342 | 972 | 988 |
Corporate and other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Income (loss) from operations | (19) | (17) | (40) | (70) |
Depreciation and amortization | 2 | 2 | 6 | 9 |
Other income (expense), net | 8 | 6 | 10 | 17 |
Provision for (benefit from) income taxes | 1 | (5) | (1) | (26) |
Additions to property, plant and equipment | 3 | 0 | 6 | 6 |
Intersegment sales [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 72 | 136 | 239 | 369 |
Intersegment sales [Member] | Olefins [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 72 | 136 | 238 | 368 |
Intersegment sales [Member] | Vinyls [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | $ 0 | $ 0 | $ 1 | $ 1 |
Segment Information (Reconcilia
Segment Information (Reconciliation of Total Segment Income from Operations to Consolidated Income before Income Taxes) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Segment Reporting [Abstract] | ||||
Income from operations | $ 226 | $ 396 | $ 554 | $ 1,201 |
Interest expense | (31) | (28) | (89) | (96) |
Other income (expense), net | 21 | 23 | 32 | 53 |
Income before income taxes | $ 216 | $ 391 | $ 497 | $ 1,158 |
Segment Information (Total Asse
Segment Information (Total Assets) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | $ 13,107 | $ 11,602 |
Operating Segments [Member] | Olefins [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 2,026 | 2,024 |
Operating Segments [Member] | Vinyls [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 9,683 | 8,879 |
Corporate and other [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | $ 1,398 | $ 699 |
Westlake Chemical Partners LP_2
Westlake Chemical Partners LP (Details) - USD ($) $ / shares in Units, $ in Millions | Mar. 29, 2019 | Sep. 30, 2019 | Dec. 31, 2014 |
Related Party Transaction [Line Items] | |||
Partners' Capital Account, Units, Sold in Public Offering | 12,937,500 | ||
Partners' Capital Account, Units, Sold in Private Placement | 2,940,818 | ||
Sale of Unit Price Per Unit | $ 21.40 | ||
Proceeds from Issuance of Private Placement | $ 63 | ||
Westlake Chemical OpCo LP [Member] | |||
Related Party Transaction [Line Items] | |||
Proceeds from issuance of Westlake Chemical Partners LP common units | $ 201 | ||
Limited Partner [Member] | Westlake Chemical OpCo LP [Member] | |||
Related Party Transaction [Line Items] | |||
Limited Partnership Ownership Percentage Increase | 4.50% | ||
Principal Stockholder [Member] | TTWF LP [Member] | |||
Related Party Transaction [Line Items] | |||
Partners' Capital Account, Units, Acquisitions | 1,401,869 | ||
Subsidiary of Common Parent [Member] | Limited Partner [Member] | Westlake Chemical OpCo LP [Member] | |||
Related Party Transaction [Line Items] | |||
Limited Liability Company (LLC) or Limited Partnership (LP), Managing Member or General Partner, Ownership Interest | 22.80% | ||
Limited Liability Company or Limited Partnership, Members or Limited Partners, Ownership Interest | 77.20% | ||
Subsidiary of Common Parent [Member] | Limited Partner [Member] | Westlake Chemical Partners LP [Member] | |||
Related Party Transaction [Line Items] | |||
Limited Liability Company or Limited Partnership, Members or Limited Partners, Ownership Interest | 40.10% | ||
Ownership interest (in units) | 14,122,230 |
Subsequent Event (Details)
Subsequent Event (Details) - Subsequent Event - LACC, LLC - USD ($) $ in Millions | Oct. 29, 2019 | Oct. 28, 2019 |
Subsequent Event [Line Items] | ||
Equity Method Investment, Ownership Percentage, Option | 34.787% | |
Option to Acquire Equity Method Investment | $ 817 | |
Investment ownership percentage | 12.00% |