Georgia-Based Axiall Profit Rises
Press release from the issuing company
Friday, February 21st, 2014
Axiall Corporation announced financial results for the fourth quarter and year ended December 31, 2013.
The company reported net sales of $4.7 billion for the full year 2013, compared to net sales of $3.3 billion reported for the full year 2012. The company reported Net income attributable to Axiall of $165.3 million, or $2.44 per diluted share, for 2013, compared to Net income attributable to Axiall of $120.5 million, or $3.45 per diluted share, for 2012. The company reported Adjusted Net Income of $266.1 million and Adjusted Earnings per Share of $3.93 for 2013, compared to Adjusted Net Income of $138.2 million and Adjusted Earnings per Share of $3.95for 2012. The company reported Adjusted EBITDA of $672.0 million for 2013, compared to Adjusted EBITDA of $334.9 million for the prior year.
“2013 was a transformational year for Axiall. We closed the merger with PPG’s chemicals business in January and immediately focused on integrating the two organizations and leveraging the combined assets,” said Paul Carrico, president and chief executive officer. “We exceeded our year-one synergy target, launched a number of innovative new products, and operated our plants at higher than industry rates for much of the year. These are all indications of a smooth and successful integration. We now are focused on leveraging our diverse end-market portfolio and access to cost-advantaged U.S. shale gas resources. One of our key strategic objectives is to gain access to cost-based ethylene, and we were pleased to announce in early February our partnership with Lotte Chemical to develop a world-scale ethane cracker fed by U.S. shale gas.”
Axiall reported net sales of $1.1 billion for the fourth quarter of 2013, compared to net sales of $784.7 million for the fourth quarter of 2012. The company reported Net income attributable to Axiall of $57.0 million, or $0.81 per diluted share, for the fourth quarter of 2013, compared to Net income attributable to Axiall of $32.3 million, or $0.92 per diluted share, for the fourth quarter of 2012. The company reported Adjusted Net Income of $62.3 million and Adjusted Earnings per Share of $0.88 for the fourth quarter of 2013, compared to Adjusted Net Income of$44.2 million, and Adjusted Earnings per Share of $1.26, for the fourth quarter of 2012. The company reported Adjusted EBITDA of $165.7 million for the fourth quarter of 2013, compared to Adjusted EBITDA of $98.3 million for the same quarter in the prior year.
Adjusted Net Income Reconciliation
| Three Months Ended | Year Ended | |||||||||||||||||||
| December 31, | December 31, | |||||||||||||||||||
|
(In millions, except per share data) |
2013 | 2012 | 2013 | 2012 | ||||||||||||||||
| Net income attributable to Axiall | $ | 57.0 | $ | 32.3 | $ | 165.3 | $ | 120.5 | ||||||||||||
| Pretax charges (benefits): | ||||||||||||||||||||
| Fair value of inventory – purchase accounting | - | - | 13.4 | - | ||||||||||||||||
| Merger related and other, net | (3.1 | ) | (a) | 11.7 | 21.2 | (b) | 38.9 | |||||||||||||
| Costs to attain merger synergies | 6.5 | (a) | - | 24.8 | (b) | - | ||||||||||||||
| Long-lived asset impairment charges (recoveries), net | 7.5 | - | 36.0 | (0.8 | ) | |||||||||||||||
| Gain on sale of assets | - | - | - | (19.3 | ) | |||||||||||||||
| Gain on acquisition of controlling interests | (2.4 | ) | - | (25.9 | ) | - | ||||||||||||||
| Loss on redemption and other debt costs | - | 2.7 | 78.5 | 2.7 | ||||||||||||||||
| Total pretax charges | 8.5 | 14.4 | 148.0 | 21.5 | ||||||||||||||||
| Provision for taxes related to these items | 3.2 | 2.5 | 47.2 | 3.8 | ||||||||||||||||
| After tax effect of above items | 5.3 | 11.9 | 100.8 | 17.7 | ||||||||||||||||
| Adjusted Net Income | $ | 62.3 | $ | 44.2 | $ | 266.1 | $ | 138.2 | ||||||||||||
| Diluted earnings per share attributable to Axiall | $ | 0.81 | $ | 0.92 | $ | 2.44 | $ | 3.45 | ||||||||||||
| Adjusted Earnings Per Share | $ | 0.88 | $ | 1.26 | $ | 3.93 | $ | 3.95 | ||||||||||||
| Adjusted EBITDA | $ | 165.7 | $ | 98.3 | $ | 672.0 | $ | 334.9 | ||||||||||||
| (a) | Merger related and other, net income of $3.1 million and cost to attain merger synergies of $6.5 million, less the $1.3 million plant reliability portion of cost to attain synergies, which is included in cost of goods sold, comprise the $2.0 million of transaction related costs and other, net in the consolidated statement of net income for the three months ended December 31, 2013. | |
| (b) | Merger related and other, net of $21.2 million and cost to attain merger synergies of $24.8 million, less the $10.3 million plant reliability portion of cost to attain synergies, which is included in cost of goods sold, comprise the $35.6 million of transaction related costs and other, net in the consolidated statement of net income for the year ended December 31, 2013. |
Chlorovinyls
In the Chlorovinyls segment, fourth quarter 2013 net sales were $751.0 million compared to $346.4 million during the fourth quarter of 2012. The increase in net sales was primarily driven by the sales contributed by the merged business. The segment posted Adjusted EBITDA of $161.3 million in the fourth quarter of 2013, compared to Adjusted EBITDA of $88.2 million for the same quarter in the prior year. The $73.1 millionincrease in Adjusted EBITDA was primarily due to the contribution from the merged business, partially offset by higher energy and feedstock costs.
Building Products
In the Building Products segment, net sales were $189.9 million for the fourth quarter of 2013, compared to $190.8 million for the same quarter in the prior year. On a constant currency basis, net sales for the quarter increased by 2 percent. The net sales increase was driven by a 21 percent increase in U.S. sales volume, partially offset by a 7 percent decrease in sales volume in Canada. The segment's Adjusted EBITDA was $13.9 million for the fourth quarter of 2013, compared to $4.8 million of Adjusted EBITDA during the same quarter of the prior year. The$9.1 million increase was primarily due to lower raw materials costs, improved conversion costs, and lower selling, general and administrative costs.
Aromatics
In the Aromatics segment, net sales decreased to $193.6 million for the fourth quarter of 2013 from $247.5 million for the fourth quarter of 2012. During the fourth quarter of 2013, the segment recorded Adjusted EBITDA of $6.9 million, compared to Adjusted EBITDA of $18.7 millionduring the same quarter in 2012. The decreases in sales and adjusted EBITDA were primarily due to lower domestic and export sales volumes.
