Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 29, 2020 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-32260 | |
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 | |
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 | 127,672,480 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001262823 | |
Current Fiscal Year End Date | --12-31 | |
Common Stock [Member] | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common Stock, $0.01 par value | |
Trading Symbol | WLK | |
Security Exchange Name | NYSE | |
1.625% Senior Notes Due 2029 | ||
Document Information [Line Items] | ||
Title of 12(b) Security | 1.625% Senior Notes due 2029 | |
Trading Symbol | WLK29 | |
Security Exchange Name | NYSE |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 1,537 | $ 728 |
Accounts receivable, net | 1,265 | 1,036 |
Inventories | 934 | 936 |
Prepaid expenses and other current assets | 32 | 42 |
Total current assets | 3,768 | 2,742 |
Property, plant and equipment, net | 6,883 | 6,912 |
Operating lease right-of-use assets | 432 | 443 |
Goodwill | 1,065 | 1,074 |
Customer relationships, net | 497 | 523 |
Other intangible assets, net | 180 | 187 |
Equity method investments | 1,065 | 1,112 |
Other assets, net | 273 | 268 |
Total assets | 14,163 | 13,261 |
Current liabilities | ||
Accounts payable | 431 | 473 |
Accrued and other liabilities | 593 | 768 |
Total current liabilities | 1,024 | 1,241 |
Long-term debt, net | 4,432 | 3,445 |
Deferred income taxes | 1,386 | 1,255 |
Pension and other post-retirement benefits | 352 | 360 |
Operating lease liabilities | 346 | 355 |
Other liabilities | 185 | 202 |
Total liabilities | 7,725 | 6,858 |
Commitments and contingencies (Note 13) | ||
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 March 31, 2020 and December 31, 2019, respectively | 1 | 1 |
Common stock, held in treasury, at cost; 6,979,662 and 6,266,609 shares at March 31, 2020 and December 31, 2019, respectively | (413) | (377) |
Additional paid-in capital | 551 | 553 |
Retained earnings | 5,860 | 5,757 |
Accumulated other comprehensive loss | (106) | (74) |
Total Westlake Chemical Corporation stockholders' equity | 5,893 | 5,860 |
Noncontrolling interests | 545 | 543 |
Total equity | 6,438 | 6,403 |
Total liabilities and equity | $ 14,163 | $ 13,261 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
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 | 6,979,662 | 6,266,609 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||
Net sales | $ 1,932 | $ 2,025 |
Cost of sales | 1,649 | 1,726 |
Gross profit | 283 | 299 |
Selling, general and administrative expenses | 120 | 116 |
Amortization of intangibles | 27 | 27 |
Restructuring, transaction and integration-related costs | 0 | 22 |
Income from operations | 136 | 134 |
Other income (expense) | ||
Interest expense | (31) | (30) |
Other income, net | 11 | 9 |
Income before income taxes | 116 | 113 |
Provision for (benefit from) income taxes | (41) | 31 |
Net income | 157 | 82 |
Net income attributable to noncontrolling interests | 12 | 10 |
Net income attributable to Westlake Chemical Corporation | $ 145 | $ 72 |
Earnings per common share attributable to Westlake Chemical Corporation: | ||
Basic (in dollars per share) | $ 1.13 | $ 0.56 |
Diluted (in dollars per share) | $ 1.13 | $ 0.55 |
Weighted average common shares outstanding: | ||
Basic (in shares) | 128,237,364 | 128,528,480 |
Diluted (in shares) | 128,442,972 | 128,913,921 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 157 | $ 82 |
Foreign Currency Translation Adjustment, by Component [Abstract] | ||
Foreign currency translation | (25) | (2) |
Income tax provision on foreign currency translation | (7) | 0 |
Other comprehensive loss, net of income taxes | (32) | (2) |
Comprehensive income | 125 | 80 |
Comprehensive income attributable to noncontrolling interests, net of tax of $1 and $1 for the three months ended March 31, 2020 and 2019, respectively | 12 | 10 |
Comprehensive income attributable to Westlake Chemical Corporation | $ 113 | $ 70 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Unaudited) OCI Parenthetical - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
OCI Parenthetical [Abstract] | ||
Other Comprehensive Income (Loss), Tax, Portion Attributable to Noncontrolling Interest | $ 1 | $ 1 |
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] |
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 | 72 | |||||
Net income attributable to noncontrolling interests | 10 | 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, 2019 | 6,403 | $ 1 | $ (377) | 553 | 5,757 | (74) | 543 |
Beginning balance, shares issued at Dec. 31, 2019 | 134,651,380 | ||||||
Beginning balance, Treasury shares at Dec. 31, 2019 | 6,266,609 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to Westlake Chemical Corporation | 145 | 145 | |||||
Net income attributable to noncontrolling interests | 12 | 12 | |||||
Net income | 157 | ||||||
Other comprehensive income (loss) | (32) | (32) | 0 | ||||
Common stock repurchased, shares | 995,529 | ||||||
Common stock repurchased | (54) | $ (54) | |||||
Shares issued—stock- based compensation (in shares) | (282,476) | ||||||
Shares issued—stock-based compensation | 2 | $ 18 | (8) | (8) | |||
Stock-based compensation | 6 | 6 | |||||
Dividends declared | (34) | (34) | |||||
Distributions to noncontrolling interests | (10) | (10) | |||||
Ending balances at Mar. 31, 2020 | $ 6,438 | $ 1 | $ (413) | $ 551 | $ 5,860 | $ (106) | $ 545 |
Ending balance, shares issued at Mar. 31, 2020 | 134,651,380 | ||||||
Ending balance, Treasury shares at Mar. 31, 2020 | 6,979,662 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities | ||
Net income | $ 157 | $ 82 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 190 | 171 |
Stock-based compensation expense | 6 | 7 |
Loss from disposition and write-off of property, plant and equipment | 5 | 20 |
Deferred income taxes | 126 | 15 |
Other losses (gains), net | (2) | 9 |
Changes in operating assets and liabilities, net of effect of business acquisitions | ||
Accounts receivable | (240) | (41) |
Inventories | (8) | 19 |
Prepaid expenses and other current assets | 7 | 4 |
Accounts payable | (2) | (7) |
Accrued and other liabilities | (146) | (110) |
Other, net | (32) | (22) |
Net cash provided by operating activities | 61 | 147 |
Cash flows from investing activities | ||
Acquisition of businesses, net of cash acquired | 0 | (236) |
Additions to property, plant and equipment | (164) | (203) |
Additions to investments in unconsolidated subsidiaries | 0 | (42) |
Return of investment from an equity investee | 39 | 0 |
Other, net | (7) | 6 |
Net cash used for investing activities | (132) | (475) |
Cash flows from financing activities | ||
Dividends paid | (34) | (33) |
Distributions to noncontrolling interests | (10) | (8) |
Net proceeds from issuance of Westlake Chemical Partners LP common units | 0 | 63 |
Proceeds from drawdown of revolver | 1,000 | 0 |
Repayment of notes payable | (27) | (4) |
Repurchase of common stock for treasury | (54) | 0 |
Other | 8 | 3 |
Net cash provided by financing activities | 883 | 21 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (3) | (1) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 809 | (308) |
Cash, cash equivalents and restricted cash at beginning of period | 750 | 775 |
Cash, cash equivalents and restricted cash at end of period | $ 1,559 | $ 467 |
Basis of Financial Statements (
Basis of Financial Statements (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
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, 2019 (the " 2019 Form 10-K"), filed with the SEC on February 19, 2020 . 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, 2019 with the exception of those accounting standards adopted in 2020 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 March 31, 2020 , its results of operations for the three months ended March 31, 2020 and 2019 , and the changes in its cash position for the three months ended March 31, 2020 and 2019 . 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, 2020 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 Income Taxes (ASU No. 2019-12) In December 2019, the Financial Accounting Standards Board ("FASB") issued an accounting standards update removing certain exceptions for investments, intraperiod allocations and interim calculations and adding guidance to reduce complexity in accounting for income taxes. The accounting standard will be effective for reporting periods beginning after December 15, 2020. Early adoption of this guidance is permitted. The Company is in the process of evaluating the impact that the new accounting guidance will have on the Company's consolidated financial position, results of operations and cash flows. Reference Rate Reform (ASU No. 2020-04) In March 2020, the FASB issued an accounting standards update to provide optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships and other transactions affected by reference rate reform, if certain criteria are met. The amendments in this update are effective for all entities as of March 12, 2020 through December 31, 2022. The Company is in the process of evaluating the impact that the new accounting guidance will have on the Company's consolidated financial position, results of operations and cash flows. Recently Adopted Accounting Standards Credit Losses (ASU No. 2016-13) In June 2016, the 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 trade receivables, debt securities and 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. In November 2019, the FASB issued an additional authoritative guidance related to credit losses. The accounting standard became effective for reporting periods beginning after December 15, 2019. The Company adopted this accounting standard effective January 1, 2020 and the adoption did not 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 became effective for reporting periods beginning after December 15, 2019. The Company adopted this accounting standard effective January 1, 2020 and the adoption did not 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. 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 accounting standard became effective for reporting periods beginning after December 15, 2019. The Company adopted this accounting standard effective January 1, 2020 and the adoption did not have a material impact on the Company's consolidated financial position, results of operations and cash flows. |
Financial Instruments (Notes)
Financial Instruments (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Financial Instruments | Financial Instruments Cash Equivalents The Company had $50 and $240 of held-to-maturity securities with original maturities of three months or less, primarily consisting of corporate debt securities, classified as cash equivalents at March 31, 2020 and December 31, 2019 , 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 March 31, 2020 and December 31, 2019 , respectively. 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) | 3 Months Ended |
Mar. 31, 2020 | |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | |
Accounts Receivable | Accounts Receivable Accounts receivable consist of the following: March 31, December 31, Trade customers $ 1,007 $ 948 Related parties 5 12 Allowance for credit losses (23 ) (22 ) 989 938 Federal and state taxes 233 59 Other 43 39 Accounts receivable, net $ 1,265 $ 1,036 |
Inventories (Notes)
Inventories (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following: March 31, December 31, Finished products $ 566 $ 568 Feedstock, additives, chemicals and other raw materials 207 210 Materials and supplies 161 158 Inventories $ 934 $ 936 |
Goodwill (Notes)
Goodwill (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill The gross carrying amounts and changes in the carrying amount of goodwill for the three months ended March 31, 2020 were as follows: Olefins Segment Vinyls Segment Total Balances at December 31, 2019 $ 30 $ 1,044 $ 1,074 Effects of changes in foreign exchange rates — (9 ) (9 ) Balances at March 31, 2020 $ 30 $ 1,035 $ 1,065 Goodwill is evaluated for impairment at least annually, or when events or changes in circumstances indicate the fair value of a reporting unit with goodwill has been reduced below its carrying value. The Company performs its annual impairment assessment for the Olefins and Vinyls reporting units in October and April, respectively. The fair values of the reporting units are assessed generally using both a discounted cash flow methodology and a market value methodology. The discounted cash flow projections are based on a long-term forecast over multiple years. The forecast is based on prices and margins projected, historical results and estimates by management, including its strategic and operational plans among other assumptions. The significant assumptions used in determining the fair values of the reporting units are the market value methodology including the determination of appropriate market comparables and the estimated multiples of EBITDA a willing buyer was likely to pay. During the three months ended March 31, 2020, the Company evaluated various events resulting from the coronavirus ("COVID-19") pandemic including the decline in the Company's stock price during the month of March 2020. Based on the evaluation, the Company does not believe that these events indicate that the fair values of the Company's reporting units have more likely than not fallen below their carrying values as of March 31, 2020 . While the Company expects these events to negatively impact its operations in the short-term, given the dynamic and evolving nature of this situation, the Company cannot reasonably estimate with certainty the long-term impacts of COVID-19. As events and changes in circumstances evolve after March 31, 2020 , such events will be considered in the Company's estimates for future periods. |
Accounts Payable (Notes)
Accounts Payable (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Accounts Payable [Abstract] | |
Accounts and Notes Payable | Accounts Payable Accounts payable consist of the following: March 31, December 31, Accounts payable—third parties $ 408 $ 435 Accounts payable to related parties 22 12 Notes payable 1 26 Accounts payable $ 431 $ 473 |
Long-Term Debt (Notes)
Long-Term Debt (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt consists of the following: March 31, 2020 December 31, 2019 Principal Unamortized Discount Net Principal Unamortized Net Revolving credit facility $ 1,000 $ — $ 1,000 $ — $ — $ — 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 (7 ) 743 750 (8 ) 742 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 (23 ) 677 700 (23 ) 677 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 (1 ) 249 1.625% senior notes due 2029 (the "1.625% 2029 Senior Notes") 770 (10 ) 760 785 (11 ) 774 Total Long-term debt $ 4,485 $ (53 ) $ 4,432 $ 3,500 $ (55 ) $ 3,445 Credit Agreement The Company has a $1,000 revolving credit facility that is scheduled to mature on July 24, 2023 (the "Credit Agreement"). On March 20, 2020, the Company borrowed $1,000 under 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. As of March 31, 2020 , the Company had $1,000 of borrowings outstanding under the Credit Agreement. The interest rate on the outstanding revolving credit facility was 2.25% at March 31, 2020 . As of March 31, 2020 , the Company had no outstanding letters of credit and no borrowing availability (absent an exercise of the accordion feature) under the Credit Agreement. The Credit Agreement contains certain affirmative and negative covenants, including a quarterly total leverage ratio financial maintenance covenant. As of March 31, 2020 , 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. 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. As of March 31, 2020 , the Company was in compliance with all of its long-term debt covenants. Unamortized debt issuance costs on long-term debt were $29 and $30 at March 31, 2020 and December 31, 2019 , respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) Changes in accumulated other comprehensive income (loss) by component for the three months ended March 31, 2020 and 2019 were as follows: Pension and Other Post-Retirement Benefits Liability, Net of Tax Cumulative Foreign Currency Exchange, Net of Tax Total Balances at December 31, 2019 $ 3 $ (77 ) $ (74 ) Other comprehensive loss before reclassifications — (32 ) (32 ) Net other comprehensive loss attributable to Westlake Chemical Corporation — (32 ) (32 ) Balances at March 31, 2020 $ 3 $ (109 ) $ (106 ) Balances at December 31, 2018 $ 27 $ (89 ) $ (62 ) Other comprehensive loss before reclassifications — (2 ) (2 ) Net other comprehensive loss attributable to Westlake Chemical Corporation — (2 ) (2 ) Balances at March 31, 2019 $ 27 $ (91 ) $ (64 ) |
Fair Value Measurements (Notes)
Fair Value Measurements (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
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, except for the revolving credit facility, 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. March 31, 2020 December 31, 2019 Carrying Value Fair Value Carrying Value Fair Value Revolving credit facility $ 1,000 $ 1,000 $ — $ — 3.60% 2022 Senior Notes 249 244 249 255 3.60% 2026 Senior Notes 743 687 742 777 Loan related to tax-exempt waste disposal revenue bonds due 2027 11 11 11 11 6 ½% 2029 GO Zone Senior Notes 99 98 99 103 6 ½% 2035 GO Zone Senior Notes 88 92 88 92 6 ½% 2035 IKE Zone Senior Notes 65 65 65 68 5.0% 2046 Senior Notes 677 651 677 761 4.375% 2047 Senior Notes 491 395 491 505 3.50% 2032 GO Zone Refunding Senior Notes 249 239 249 267 1.625% 2029 Senior Notes 760 688 774 785 |
Income Taxes (Notes)
Income Taxes (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The effective income tax rate was a benefit of 35.3% for the three months ended March 31, 2020 as compared to an expense of 27.4% for the three months ended March 31, 2019 . The effective income tax rate for the three months ended March 31, 2020 was a benefit and below the statutory rate of 21.0% primarily due to the income tax rate benefit resulting from the carryback of federal net operating loss ("NOL") to taxable years that were taxed at the U.S. corporate tax rate of 35.0% as permitted under the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"), partially offset by the reduction in the Internal Revenue Code Section 199 ("Section 199") domestic manufacturing deduction, as a result of the NOL carryback. The effective income tax rate for the three months ended March 31, 2019 was above the U.S. federal statutory rate of 21.0% primarily due to state taxes, foreign taxes and the tax effect related to the charges associated with the write-off of certain assets. On March 27, 2020, the CARES Act was enacted and signed into law. The CARES Act, among other things, permits any federal NOL generated in 2018, 2019 and 2020 to be carried back to each of the five tax years preceding the tax year of the federal NOL to fully offset taxable income to generate a refund of previously paid income taxes. However, any such federal NOL not carried back can be carried forward to fully offset taxable income, but only for the taxable years beginning before January 1, 2021, after which, the federal NOL deduction limitation not to exceed 80.0% of taxable income under the U.S. Tax Cuts and Jobs Act (the "Tax Act") will be reinstated. Federal NOLs generated in 2018, 2019 and 2020 measured at the current U.S. corporate tax rate of 21.0% that are carried back to taxable years prior to the Tax Act to fully offset taxable income taxed at the U.S. corporate tax rate of 35.0% result in an income tax rate benefit. At the end of 2019, the Company generated a federal NOL primarily due to bonus tax depreciation from the Company's investment in LACC, LLC ("LACC"), which is accounted for as an equity method investment. This federal NOL was increased to account for the disallowed interest deduction which originated in 2019 that is no longer disallowed due to the increase in the business interest expense deduction limitation from 30.0% to 50.0% of adjusted taxable income for tax years 2019 and 2020 as permitted under the CARES Act. For the three months ended March 31, 2020 , the carryback of the federal NOL resulted in a net tax benefit of $62 |
Earnings and Dividends per Shar
Earnings and Dividends per Share (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
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. Basic earnings per share for the periods are based upon the weighted average number of shares of common stock outstanding during each period. Diluted earnings per share include the effects of certain stock options and performance stock units. Three Months Ended March 31, 2020 2019 Net income attributable to Westlake Chemical Corporation $ 145 $ 72 Less: Net income attributable to participating securities — (1 ) Net income attributable to common shareholders $ 145 $ 71 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 March 31, 2020 2019 Weighted average common shares—basic 128,237,364 128,528,480 Plus incremental shares from: Assumed exercise of options and vesting of performance stock units 205,608 385,441 Weighted average common shares—diluted 128,442,972 128,913,921 Earnings per common share attributable to Westlake Chemical Corporation: Basic $ 1.13 $ 0.56 Diluted $ 1.13 $ 0.55 Excluded from the computation of diluted earnings per share are options to purchase 1,099,638 and 320,473 shares of common stock for the three months ended March 31, 2020 and 2019 , 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 months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 2019 Dividends per common share $ 0.2625 $ 0.2500 |
Supplemental Information (Notes
Supplemental Information (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Information | Supplemental Information Equity Method Investments The Company's investment in LACC, a related party, was $990 and $1,038 at March 31, 2020 and December 31, 2019 , respectively. During the three months ended March 31, 2020 , the Company received $39 from LACC representing return of investment. Accrued and Other Liabilities Accrued and other liabilities were $593 and $768 at March 31, 2020 and December 31, 2019 , respectively. Accrued rebates and operating lease liability, which are components of accrued and other liabilities, were $66 and $92 at March 31, 2020 , respectively; and $115 and $93 at December 31, 2019 , respectively. No other component of accrued and other liabilities was more than five percent of total current liabilities. Accrued liabilities with related parties were $23 and $41 at March 31, 2020 and December 31, 2019 , respectively. Non-cash Investing Activity The non-cash investing activities related to accruals for capital expenditures were $27 and $10 , for t he three months ended March 31, 2020 and 2019, respectively. Operating Lease Supplemental Cash Flow Supplemental cash flow information related to leases was as follows: Three Months Ended March 31, 2020 2019 Operating cash flows used for operating leases (1) $ (28 ) $ (28 ) Right-of-use assets obtained in exchange for operating lease obligations 17 3 _____________ (1) Includes cash paid for amounts included in the measurement of operating lease liabilities recorded in the consolidated balance sheets. For the three months ended March 31, 2020 and 2019 , finance lease related cash flows used for operating and financing activities were not material to the consolidated statements of cash flows. |
Commitments and Contingencies (
Commitments and Contingencies (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
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. The plaintiffs seek an unspecified amount of damages and injunctive relief. The defendants' joint motion to dismiss the direct purchaser lawsuits was denied, so those cases will proceed with discovery. 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 March 31, 2020 and December 31, 2019 , the Company had reserves for environmental contingencies totaling approximately $46 and $47 , 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 special notice letters for the remedial action phase of work at the site. The Company, jointly with the other PRPs, submitted a good faith offer response in December 2019. The PRPs signed a consent decree for remedial action in March 2020, which is subject to approval by the EPA and the Department of Justice before it is filed with the court. 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 paid such costs 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. On February 11, 2020, the U.S. District Court for the Western District of Kentucky denied PolyOne's motion to vacate and affirmed the arbitration final award. PolyOne did not file a notice of appeal before the March 10, 2020 deadline to contest the court's decision. Accordingly, the final award was affirmed and the arbitration proceeding is fully and finally resolved. At this time, the Company is not able to estimate the impact, if any, that any subsequent arbitration or 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 $70 to $130 . |
Segment Information (Notes)
Segment Information (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
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 March 31, 2020 2019 Net external sales Olefins Polyethylene $ 310 $ 337 Styrene, feedstock and other 117 122 Total Olefins 427 459 Vinyls PVC, caustic soda and other 1,213 1,307 Building products 292 259 Total Vinyls 1,505 1,566 $ 1,932 $ 2,025 Intersegment sales Olefins $ 68 $ 92 Vinyls — — $ 68 $ 92 Three Months Ended March 31, 2020 2019 Income (loss) from operations Olefins $ 62 $ 37 Vinyls 73 101 Corporate and other 1 (4 ) $ 136 $ 134 Depreciation and amortization Olefins $ 35 $ 35 Vinyls 153 134 Corporate and other 2 2 $ 190 $ 171 Other income, net Olefins $ 1 $ 2 Vinyls 6 4 Corporate and other 4 3 $ 11 $ 9 Provision for (benefit from) income taxes Olefins $ 41 $ 9 Vinyls (78 ) 23 Corporate and other (4 ) (1 ) $ (41 ) $ 31 Capital expenditures Olefins $ 27 $ 25 Vinyls 136 177 Corporate and other 1 1 $ 164 $ 203 A reconciliation of total segment income from operations to consolidated income before income taxes is as follows: Three Months Ended March 31, 2020 2019 Income from operations $ 136 $ 134 Interest expense (31 ) (30 ) Other income, net 11 9 Income before income taxes $ 116 $ 113 March 31, December 31, Total assets Olefins $ 1,978 $ 1,991 Vinyls 10,434 10,597 Corporate and other 1,751 673 $ 14,163 $ 13,261 |
Westlake Chemical Partners LP (
Westlake Chemical Partners LP (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
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 interests 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 the 2,940,818 common units issued in the private placement. At March 31, 2020 , 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 the limited partner interests (consisting of 14,122,230 common units) and incentive distribution rights. On October 4, 2018, WLKP and Westlake Partners GP, the general partner of WLKP, entered into an Equity Distribution Agreement with UBS Securities LLC, Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc., RBC Capital Markets, LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC to offer and sell WLKP's common units, from time to time, up to an aggregate offering amount of $50 . This Equity Distribution Agreement was amended on February 28, 2020 to reference a new shelf registration for utilization under this agreement. No common units were issued under this program as of March 31, 2020 . |
Subsequent Event
Subsequent Event | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent EventOn March 11, 2020, the World Health Organization declared the ongoing COVID-19 outbreak a pandemic and recommended containment and mitigation measures worldwide. The pandemic has resulted in widespread adverse impacts on the global economy. Though the Company did not experience significant disruptions in the first quarter of 2020, it has seen disruptions in the month of April such as some customer order cancellations and expected lower demand for certain of the Company's products which has led the Company to proactively temporarily idle production at several of the Company's smaller non-integrated plants and reduce operating rates at others. The Company expects a negative resulting impact to the Company's business operations in the near future, as the pandemic and its impacts on the global economy continue to spread through most of its markets. However, the effect that COVID-19 will have on the financial condition, results of operations and cash flows cannot be estimated with certainty at this time as it will depend on future developments, including, among others, the ultimate duration, geographic spread and severity of the virus, the actions to contain the virus, the consequences of governmental and other measures designed to prevent the spread of the virus, the development of effective treatments, actions taken by customers, suppliers and other third parties, workforce availability, and the timing and extent to which normal economic and operating conditions resume. |
Basis of Financial Statements_2
Basis of Financial Statements (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
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, 2019 (the " 2019 Form 10-K"), filed with the SEC on February 19, 2020 . 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, 2019 with the exception of those accounting standards adopted in 2020 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 March 31, 2020 , its results of operations for the three months ended March 31, 2020 and 2019 , and the changes in its cash position for the three months ended March 31, 2020 and 2019 . 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, 2020 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 Income Taxes (ASU No. 2019-12) In December 2019, the Financial Accounting Standards Board ("FASB") issued an accounting standards update removing certain exceptions for investments, intraperiod allocations and interim calculations and adding guidance to reduce complexity in accounting for income taxes. The accounting standard will be effective for reporting periods beginning after December 15, 2020. Early adoption of this guidance is permitted. The Company is in the process of evaluating the impact that the new accounting guidance will have on the Company's consolidated financial position, results of operations and cash flows. Reference Rate Reform (ASU No. 2020-04) In March 2020, the FASB issued an accounting standards update to provide optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships and other transactions affected by reference rate reform, if certain criteria are met. The amendments in this update are effective for all entities as of March 12, 2020 through December 31, 2022. The Company is in the process of evaluating the impact that the new accounting guidance will have on the Company's consolidated financial position, results of operations and cash flows. Recently Adopted Accounting Standards Credit Losses (ASU No. 2016-13) In June 2016, the 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 trade receivables, debt securities and 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. In November 2019, the FASB issued an additional authoritative guidance related to credit losses. The accounting standard became effective for reporting periods beginning after December 15, 2019. The Company adopted this accounting standard effective January 1, 2020 and the adoption did not 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 became effective for reporting periods beginning after December 15, 2019. The Company adopted this accounting standard effective January 1, 2020 and the adoption did not 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. 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 accounting standard became effective for reporting periods beginning after December 15, 2019. The Company adopted this accounting standard effective January 1, 2020 and the adoption did not have a material impact on the Company's consolidated financial position, results of operations and cash flows. |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | |
Schedule Of Accounts Receivable | Accounts receivable consist of the following: March 31, December 31, Trade customers $ 1,007 $ 948 Related parties 5 12 Allowance for credit losses (23 ) (22 ) 989 938 Federal and state taxes 233 59 Other 43 39 Accounts receivable, net $ 1,265 $ 1,036 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule Of Inventory | Inventories consist of the following: March 31, December 31, Finished products $ 566 $ 568 Feedstock, additives, chemicals and other raw materials 207 210 Materials and supplies 161 158 Inventories $ 934 $ 936 |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The gross carrying amounts and changes in the carrying amount of goodwill for the three months ended March 31, 2020 were as follows: Olefins Segment Vinyls Segment Total Balances at December 31, 2019 $ 30 $ 1,044 $ 1,074 Effects of changes in foreign exchange rates — (9 ) (9 ) Balances at March 31, 2020 $ 30 $ 1,035 $ 1,065 |
Accounts Payable (Tables)
Accounts Payable (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accounts Payable [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities | Accounts payable consist of the following: March 31, December 31, Accounts payable—third parties $ 408 $ 435 Accounts payable to related parties 22 12 Notes payable 1 26 Accounts payable $ 431 $ 473 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule Of Long-Term Debt | Long-term debt consists of the following: March 31, 2020 December 31, 2019 Principal Unamortized Discount Net Principal Unamortized Net Revolving credit facility $ 1,000 $ — $ 1,000 $ — $ — $ — 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 (7 ) 743 750 (8 ) 742 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 (23 ) 677 700 (23 ) 677 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 (1 ) 249 1.625% senior notes due 2029 (the "1.625% 2029 Senior Notes") 770 (10 ) 760 785 (11 ) 774 Total Long-term debt $ 4,485 $ (53 ) $ 4,432 $ 3,500 $ (55 ) $ 3,445 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes in accumulated other comprehensive income (loss) by component for the three months ended March 31, 2020 and 2019 were as follows: Pension and Other Post-Retirement Benefits Liability, Net of Tax Cumulative Foreign Currency Exchange, Net of Tax Total Balances at December 31, 2019 $ 3 $ (77 ) $ (74 ) Other comprehensive loss before reclassifications — (32 ) (32 ) Net other comprehensive loss attributable to Westlake Chemical Corporation — (32 ) (32 ) Balances at March 31, 2020 $ 3 $ (109 ) $ (106 ) Balances at December 31, 2018 $ 27 $ (89 ) $ (62 ) Other comprehensive loss before reclassifications — (2 ) (2 ) Net other comprehensive loss attributable to Westlake Chemical Corporation — (2 ) (2 ) Balances at March 31, 2019 $ 27 $ (91 ) $ (64 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Summary Of Carrying And Fair Values Of Long-Term Debt | The Company's long-term debt instruments, except for the revolving credit facility, 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. March 31, 2020 December 31, 2019 Carrying Value Fair Value Carrying Value Fair Value Revolving credit facility $ 1,000 $ 1,000 $ — $ — 3.60% 2022 Senior Notes 249 244 249 255 3.60% 2026 Senior Notes 743 687 742 777 Loan related to tax-exempt waste disposal revenue bonds due 2027 11 11 11 11 6 ½% 2029 GO Zone Senior Notes 99 98 99 103 6 ½% 2035 GO Zone Senior Notes 88 92 88 92 6 ½% 2035 IKE Zone Senior Notes 65 65 65 68 5.0% 2046 Senior Notes 677 651 677 761 4.375% 2047 Senior Notes 491 395 491 505 3.50% 2032 GO Zone Refunding Senior Notes 249 239 249 267 1.625% 2029 Senior Notes 760 688 774 785 |
Earnings and Dividends per Sh_2
Earnings and Dividends per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings and Dividends Per Share [Abstract] | |
Schedule Of Net Income Attributable To Common Stockholders | Diluted earnings per share include the effects of certain stock options and performance stock units. Three Months Ended March 31, 2020 2019 Net income attributable to Westlake Chemical Corporation $ 145 $ 72 Less: Net income attributable to participating securities — (1 ) Net income attributable to common shareholders $ 145 $ 71 |
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 March 31, 2020 2019 Weighted average common shares—basic 128,237,364 128,528,480 Plus incremental shares from: Assumed exercise of options and vesting of performance stock units 205,608 385,441 Weighted average common shares—diluted 128,442,972 128,913,921 Earnings per common share attributable to Westlake Chemical Corporation: Basic $ 1.13 $ 0.56 Diluted $ 1.13 $ 0.55 |
Dividends Per Share | Dividends per Share Dividends per common share for the three months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 2019 Dividends per common share $ 0.2625 $ 0.2500 |
Supplemental Information (Table
Supplemental Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Supplemental Cash Flow Information [Abstract] | |
Schedule of Operating Lease Supplemental Cash Flow | Supplemental cash flow information related to leases was as follows: Three Months Ended March 31, 2020 2019 Operating cash flows used for operating leases (1) $ (28 ) $ (28 ) Right-of-use assets obtained in exchange for operating lease obligations 17 3 _____________ (1) Includes cash paid for amounts included in the measurement of operating lease liabilities recorded in the consolidated balance sheets. For the three months ended March 31, 2020 and 2019 , finance lease related cash flows used for operating and financing activities were not material to the consolidated statements of cash flows. |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting Information | Three Months Ended March 31, 2020 2019 Net external sales Olefins Polyethylene $ 310 $ 337 Styrene, feedstock and other 117 122 Total Olefins 427 459 Vinyls PVC, caustic soda and other 1,213 1,307 Building products 292 259 Total Vinyls 1,505 1,566 $ 1,932 $ 2,025 Intersegment sales Olefins $ 68 $ 92 Vinyls — — $ 68 $ 92 Three Months Ended March 31, 2020 2019 Income (loss) from operations Olefins $ 62 $ 37 Vinyls 73 101 Corporate and other 1 (4 ) $ 136 $ 134 Depreciation and amortization Olefins $ 35 $ 35 Vinyls 153 134 Corporate and other 2 2 $ 190 $ 171 Other income, net Olefins $ 1 $ 2 Vinyls 6 4 Corporate and other 4 3 $ 11 $ 9 Provision for (benefit from) income taxes Olefins $ 41 $ 9 Vinyls (78 ) 23 Corporate and other (4 ) (1 ) $ (41 ) $ 31 Capital expenditures Olefins $ 27 $ 25 Vinyls 136 177 Corporate and other 1 1 $ 164 $ 203 |
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 March 31, 2020 2019 Income from operations $ 136 $ 134 Interest expense (31 ) (30 ) Other income, net 11 9 Income before income taxes $ 116 $ 113 |
Total Assets | March 31, December 31, Total assets Olefins $ 1,978 $ 1,991 Vinyls 10,434 10,597 Corporate and other 1,751 673 $ 14,163 $ 13,261 |
Financial Instruments (Narrativ
Financial Instruments (Narrative) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Investments, Debt and Equity Securities [Abstract] | ||
Debt Securities, Held-to-maturity | $ 50 | $ 240 |
Restricted Cash and Cash Equivalents | $ 22 | $ 22 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | ||
Trade customers | $ 1,007 | $ 948 |
Related parties | 5 | 12 |
Allowance for credit losses | (23) | (22) |
Accounts receivable from trade customers, net | 989 | 938 |
Federal and state taxes | 233 | 59 |
Other | 43 | 39 |
Accounts receivable, net | $ 1,265 | $ 1,036 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Finished products | $ 566 | $ 568 |
Feedstock, additives, chemicals and other raw materials | 207 | 210 |
Materials and supplies | 161 | 158 |
Inventories | $ 934 | $ 936 |
Goodwill (Details)
Goodwill (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Goodwill [Roll Forward] | |
Beginning Balance | $ 1,074 |
Effects of changes in foreign exchange rates | (9) |
Ending Balance | 1,065 |
Olefins [Member] | |
Goodwill [Roll Forward] | |
Beginning Balance | 30 |
Effects of changes in foreign exchange rates | 0 |
Ending Balance | 30 |
Vinyls [Member] | |
Goodwill [Roll Forward] | |
Beginning Balance | 1,044 |
Effects of changes in foreign exchange rates | (9) |
Ending Balance | $ 1,035 |
Accounts Payable (Details)
Accounts Payable (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Accounts Payable [Abstract] | ||
Accounts payable—third parties | $ 408 | $ 435 |
Accounts payable to related parties | 22 | 12 |
Notes payable | 1 | 26 |
Accounts payable | $ 431 | $ 473 |
Long-Term Debt (Schedule of Lon
Long-Term Debt (Schedule of Long-term Debt) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||
Principal Amount | $ 4,485 | $ 3,500 |
Unamortized Premium (Discount) and Debt Issuance Costs | (53) | (55) |
Net, Long-term Debt | $ 4,432 | 3,445 |
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 | (7) | (8) |
Net, Long-term Debt | $ 743 | 742 |
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 | (23) | (23) |
Net, Long-term Debt | $ 677 | 677 |
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) | (1) |
Net, Long-term Debt | $ 249 | 249 |
Senior Notes [Member] | 1.625% Senior Notes Due 2029 | ||
Debt Instrument [Line Items] | ||
Debt Instrument Maturity | 2029 | |
Stated interest rate (percent) | 1.625% | |
Principal Amount | $ 770 | 785 |
Unamortized Premium (Discount) and Debt Issuance Costs | (10) | (11) |
Net, Long-term Debt | 760 | 774 |
Revolving Credit Facility [Member] | Line of Credit [Member] | Credit Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 1,000 | 0 |
Unamortized Premium (Discount) and Debt Issuance Costs | 0 | 0 |
Net, Long-term Debt | $ 1,000 | $ 0 |
Long-Term Debt (Credit Agreemen
Long-Term Debt (Credit Agreement) (Details) - USD ($) $ in Millions | Jul. 24, 2018 | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | |||
Principal Amount | $ 4,485 | $ 3,500 | |
Credit Agreement [Member] | Line of Credit [Member] | Minimum [Member] | |||
Debt Instrument [Line Items] | |||
Line of credit permitted increase | $ 25 | ||
Credit Agreement [Member] | Line of Credit [Member] | Maximum [Member] | |||
Debt Instrument [Line Items] | |||
Line of credit permitted increase | 500 | ||
Credit Agreement [Member] | Revolving Credit Facility [Member] | |||
Debt Instrument [Line Items] | |||
Remaining borrowing capacity | 0 | ||
Credit Agreement [Member] | Revolving Credit Facility [Member] | Line of Credit [Member] | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | 1,000 | ||
Principal Amount | 1,000 | $ 0 | |
Outstanding letters of credit | $ 0 | ||
Credit Agreement [Member] | Letter of Credit [Member] | Line of Credit [Member] | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | 150 | ||
Credit Agreement [Member] | Swingline Loan [Member] | Line of Credit [Member] | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 50 | ||
Credit Agreement [Member] | Alternate Base Rate [Domain] | Revolving Credit Facility [Member] | Line of Credit [Member] | Minimum [Member] | |||
Debt Instrument [Line Items] | |||
Spread on variable rate | 0.00% | ||
Credit Agreement [Member] | Alternate Base Rate [Domain] | Revolving Credit Facility [Member] | Line of Credit [Member] | Maximum [Member] | |||
Debt Instrument [Line Items] | |||
Spread on variable rate | 0.75% | ||
Credit Agreement [Member] | 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% | ||
Credit Agreement [Member] | 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) - USD ($) $ in Millions | Mar. 20, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | |||
Long-term Debt | $ 4,432 | $ 3,445 | |
Unamortized Debt Issuance Cost | $ 29 | 30 | |
Senior Notes [Member] | 1.625% Senior Notes Due 2029 | |||
Debt Instrument [Line Items] | |||
Stated interest rate (percent) | 1.625% | ||
Long-term Debt | $ 760 | 774 | |
Revolving Credit Facility [Member] | |||
Debt Instrument [Line Items] | |||
Line of Credit Facility, Interest Rate at Period End | 2.25% | ||
Revolving Credit Facility [Member] | Line of Credit [Member] | Credit Agreement [Member] | |||
Debt Instrument [Line Items] | |||
Proceeds from Lines of Credit | $ 1,000 | ||
Long-term Debt | $ 1,000 | $ 0 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Schedule of Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | $ 5,860 | |
Ending balance | 5,893 | |
Accumulated Defined Benefit Plans Adjustment Attributable to Parent [Member] | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | 3 | $ 27 |
Other comprehensive loss before reclassifications | 0 | 0 |
Net other comprehensive loss attributable to Westlake Chemical Corporation | 0 | 0 |
Ending balance | 3 | 27 |
Accumulated Foreign Currency Adjustment Attributable to Parent [Member] | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | (77) | (89) |
Other comprehensive loss before reclassifications | (32) | (2) |
Net other comprehensive loss attributable to Westlake Chemical Corporation | (32) | (2) |
Ending balance | (109) | (91) |
Accumulated Other Comprehensive Income (Loss) [Member] | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | (74) | (62) |
Other comprehensive loss before reclassifications | (32) | (2) |
Net other comprehensive loss attributable to Westlake Chemical Corporation | (32) | (2) |
Ending balance | $ (106) | $ (64) |
Fair Value Measurements (Summar
Fair Value Measurements (Summary of Carrying and Fair Values of Long Term Debt) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term Debt | $ 4,432 | $ 3,445 |
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 | $ 743 | 742 |
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 | $ 677 | 677 |
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 | 249 |
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 | $ 760 | 774 |
Debt Instrument Maturity | 2029 | |
Stated interest rate (percent) | 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] | ||
Fair Value | $ 244 | 255 |
Fair Value [Member] | 3.6% Senior Notes Due 2026 [Member] | Senior Notes [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | 687 | 777 |
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] | ||
Fair Value | 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] | ||
Fair Value | 98 | 103 |
Fair Value [Member] | 2035 GO Zone 6 1/2% Notes [Member] | Senior Notes [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | 92 | 92 |
Fair Value [Member] | 2035 IKE Zone 6 1/2% Notes [Member] | Senior Notes [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | 65 | 68 |
Fair Value [Member] | 5.0% Senior Notes Due 2046 [Member] | Senior Notes [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | 651 | 761 |
Fair Value [Member] | 4.375% Senior Notes Due 2047 [Member] | Senior Notes [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | 395 | 505 |
Fair Value [Member] | 3.50% Senior Notes Due 2032 [Member] | Senior Notes [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | 239 | 267 |
Fair Value [Member] | 1.625% Senior Notes Due 2029 | Senior Notes [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | 688 | 785 |
Revolving Credit Facility [Member] | Credit Agreement [Member] | Line of Credit [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term Debt | 1,000 | 0 |
Revolving Credit Facility [Member] | Fair Value [Member] | Credit Agreement [Member] | Line of Credit [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | $ 1,000 | $ 0 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate | (35.30%) | 27.40% |
U.S. federal statutory income tax rate | 21.00% | 21.00% |
CARES Act benefit | $ 62 |
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 | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings and Dividends Per Share [Abstract] | ||
Net income attributable to Westlake Chemical Corporation | $ 145 | $ 72 |
Net income attributable to participating securities | 0 | (1) |
Net income attributable to common shareholders | $ 145 | $ 71 |
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 | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings and Dividends Per Share [Abstract] | ||
Weighted average common shares—basic | 128,237,364 | 128,528,480 |
Weighted Average Number Diluted Shares Outstanding Adjustment | 205,608 | 385,441 |
Weighted average common shares-diluted | 128,442,972 | 128,913,921 |
Earnings per share attributable to Westlake Chemical Corporation: Basic (in dollars per share) | $ 1.13 | $ 0.56 |
Earnings per share attributable to Westlake Chemical Corporation: Diluted (in dollars per share) | $ 1.13 | $ 0.55 |
Earnings and Dividends per Sh_5
Earnings and Dividends per Share (Additional Information) (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings and Dividends Per Share [Abstract] | ||
Number of options excluded from computation of diluted earnings per share | 1,099,638 | 320,473 |
Earnings and Dividends per Sh_6
Earnings and Dividends per Share Dividends Per Share (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings and Dividends Per Share [Abstract] | ||
Dividends per common share (in usd per share) | $ 0.2625 | $ 0.2500 |
Supplemental Information (Equit
Supplemental Information (Equity Method Investments) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Schedule of Equity Method Investments [Line Items] | |||
Proceeds from equity method investments | $ (39) | $ 0 | |
LACC, LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Investments in and Advances to Affiliates, at Fair Value | 990 | $ 1,038 | |
Proceeds from equity method investments | $ (39) |
Supplemental Information (Addit
Supplemental Information (Additional Information) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Accrued Liabilities and Other Liabilities [Abstract] | |||
Accrued and other liabilities | $ 593 | $ 768 | |
Accrued rebates | 66 | 115 | |
Operating Lease, Liability, Current | 92 | 93 | |
Accrued liabilities with related parties | 23 | $ 41 | |
Noncash Investing and Financing Items [Abstract] | |||
Accruals for capital expenditure | $ (27) | $ (10) |
Supplemental Information (Opera
Supplemental Information (Operating Lease Supplemental Cash Flow) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Supplemental Cash Flow Information [Abstract] | ||
Operating cash flows from operating leases | $ (28) | $ (28) |
Right-of-use assets obtained in exchange for operating lease obligations | $ 17 | $ 3 |
Commitments and Contingencies_2
Commitments and Contingencies (Additional Information) (Detail) - USD ($) $ in Millions | May 22, 2019 | Jun. 18, 2018 | May 31, 2017 | Mar. 31, 2020 | Dec. 31, 2019 |
Environmental Loss Contingencies [Line Items] | |||||
Environmental Loss contingency accrual | $ 46 | $ 47 | |||
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 | $ 70 | ||||
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) | 3 Months Ended |
Mar. 31, 2020Segment | |
Segment Reporting [Abstract] | |
Number of segments | 2 |
Segment Information (Segment Re
Segment Information (Segment Reporting Information) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Segment Reporting Information [Line Items] | ||
Net sales | $ 1,932 | $ 2,025 |
Income (loss) from operations | 136 | 134 |
Depreciation and amortization | 190 | 171 |
Other income, net | 11 | 9 |
Provision for (benefit from) income taxes | (41) | 31 |
Capital expenditures | 164 | 203 |
Operating Segments [Member] | Olefins [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 427 | 459 |
Income (loss) from operations | 62 | 37 |
Depreciation and amortization | 35 | 35 |
Other income, net | 1 | 2 |
Provision for (benefit from) income taxes | 41 | 9 |
Capital expenditures | 27 | 25 |
Operating Segments [Member] | Vinyls [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 1,505 | 1,566 |
Income (loss) from operations | 73 | 101 |
Depreciation and amortization | 153 | 134 |
Other income, net | 6 | 4 |
Provision for (benefit from) income taxes | (78) | 23 |
Capital expenditures | 136 | 177 |
Operating Segments [Member] | Polyethylene [Member] | Olefins [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 310 | 337 |
Operating Segments [Member] | Styrene, Feedstock And Other [Member] | Olefins [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 117 | 122 |
Operating Segments [Member] | PVC, Caustic Soda And Other [Member] | Vinyls [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 1,213 | 1,307 |
Operating Segments [Member] | Building Products [Member] | Vinyls [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 292 | 259 |
Corporate and other [Member] | ||
Segment Reporting Information [Line Items] | ||
Income (loss) from operations | 1 | (4) |
Depreciation and amortization | 2 | 2 |
Other income, net | 4 | 3 |
Provision for (benefit from) income taxes | (4) | (1) |
Capital expenditures | 1 | 1 |
Intersegment sales [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 68 | 92 |
Intersegment sales [Member] | Olefins [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 68 | 92 |
Intersegment sales [Member] | Vinyls [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | $ 0 | $ 0 |
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 | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Segment Reporting [Abstract] | ||
Income from operations | $ 136 | $ 134 |
Interest expense | (31) | (30) |
Other income (expense), net | 11 | 9 |
Income before income taxes | $ 116 | $ 113 |
Segment Information (Total Asse
Segment Information (Total Assets) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | $ 14,163 | $ 13,261 |
Operating Segments [Member] | Olefins [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 1,978 | 1,991 |
Operating Segments [Member] | Vinyls [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 10,434 | 10,597 |
Corporate and other [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | $ 1,751 | $ 673 |
Westlake Chemical Partners LP_2
Westlake Chemical Partners LP (Details) - USD ($) $ / shares in Units, $ in Millions | Mar. 29, 2019 | Oct. 04, 2018 | Mar. 31, 2020 | 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 | |||
Partners' Units, Maximum Aggregate Offering Amount, ATM | $ 50 | |||
Principal Stockholder [Member] | TTWF LP [Member] | ||||
Related Party Transaction [Line Items] | ||||
Partners' Capital Account, Units, Acquisitions | 1,401,869 | |||
Westlake Chemical OpCo LP [Member] | ||||
Related Party Transaction [Line Items] | ||||
Proceeds from issuance of Westlake Chemical Partners LP common units | $ 201 | |||
Westlake Chemical OpCo LP [Member] | Limited Partner [Member] | ||||
Related Party Transaction [Line Items] | ||||
Limited Partnership Ownership Percentage Increase | 4.50% | |||
Westlake Chemical OpCo LP [Member] | Subsidiary of Common Parent [Member] | Limited Partner [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% | |||
Westlake Chemical Partners LP [Member] | Subsidiary of Common Parent [Member] | Limited Partner [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 |