HOUSTON, Feb. 23, 2016 /PRNewswire/ -- Westlake Chemical Partners LP (NYSE: WLKP) (the "Partnership") today reported net income attributable to the Partnership of $10.8 million, or $0.40 per limited partner unit, for the three months ended December 31, 2015, an increase of $2.2 million when compared with fourth quarter 2014 net income attributable to the Partnership of $8.6 million. For the three months ended December 31, 2015, MLP distributable cash flow was $10.1 million, an increase of $1.6 million compared to fourth quarter 2014 MLP distributable cash flow of $8.5 million. The increase in net income attributable to the Partnership and MLP distributable cash flow compared to the fourth quarter 2014 is primarily due to the purchase of an additional 2.7% interest in Westlake Chemical OpCo LP ("OpCo") by the Partnership on April 1, 2015.
The Partnership's fourth quarter 2015 net income of $10.8 million, or $0.40 per limited partner unit, increased by $0.7 million from the third quarter 2015 net income of $10.1 million, or $0.37 per limited partner unit. Fourth quarter 2015 MLP distributable cash flow of $10.1 million increased by $0.6 million when compared to third quarter 2015 MLP distributable cash flow of $9.5 million, largely due to increased production at the Partnership's ethylene facilities.
For the full year 2015, net income attributable to the Partnership was $39.8 million, or $1.47 per limited partner unit. MLP distributable cash flow for the full year 2015 was $37.7 million.
On February 1, 2016, the Board of Directors of Westlake Chemical Partners GP LLC, the general partner of the Partnership, announced a quarterly distribution of $0.3080 per unit to be payable on February 26, 2016 to unitholders of record on February 11, 2016. The MLP distributable cash flow provided coverage of 1.21x the declared distributions for the fourth quarter 2015. For the full year 2015, MLP distributable cash flow of $37.7 million provided coverage of 1.18x the declared distributions during the year. The increase in cash distributions is in line with the Partnership's targeted low double-digit distribution growth.
OpCo's sales agreement with Westlake Chemical Corporation is designed to provide for stable and predictable cash flows. The sales agreement provides that 95% of OpCo's ethylene production is sold to Westlake Chemical Corporation for a cash margin of $0.10 per pound, net of operating costs, maintenance capital expenditures and reserves for future turnaround expenditures.
"We are very pleased with the fourth quarter and full year results for 2015, our first full year in operation since our IPO in August 2014. While we have seen a significant decrease in the price of ethylene, OpCo's long-term fixed margin ethylene sales agreement with our sponsor, Westlake Chemical Corporation, is not subject to the volatility in the oil and ethylene markets. The expansion of our Petro 1 facility in Lake Charles, Louisiana, which is planned for completion in the first half of 2016, is expected to add 250 million pounds of ethylene capacity. In addition, our recently announced expansion at our Calvert City, Kentucky facility scheduled for completion in the first half of 2017 and other incremental capacity increases will add 100 million pounds of annual ethylene capacity. We believe these projects will allow us to continue on our targeted low double-digit growth rate without the need to purchase any additional interest in OpCo," said Albert Chao, President and Chief Executive Officer.
The statements in this release and the related teleconference relating to matters that are not historical facts, such as statements regarding targeted growth and timing and results of expansion projects, are forward-looking statements. These forward-looking statements are subject to significant risks and uncertainties. Actual results could differ materially, based on factors including, but not limited to, operating difficulties; the volume of ethylene that we are able to sell; the price at which we are able to sell ethylene; changes in the price and availability of electricity; changes in prevailing economic conditions; actions of Westlake Chemical Corporation; actions of third parties; unanticipated ground, grade or water conditions; inclement or hazardous weather conditions, including flooding, and the physical impacts of climate change; environmental hazards; industrial accidents; changes in laws and regulations (or the interpretation thereof); inability to acquire or maintain necessary permits; inability to obtain necessary production equipment or replacement parts; technical difficulties or failures; labor disputes; late delivery of raw materials; difficulty collecting receivables; inability of our customers to take delivery; changes in the price and availability of transportation; fires, explosions or other accidents; our ability to borrow funds and access capital markets; and other risk factors. For more detailed information about the factors that could cause actual results to differ materially, please refer to the Partnership's Annual Report on Form 10-K for the year ended December 31, 2014, which was filed with the SEC in March 2015, and the risk factors in our other filings with the SEC.
This release includes the term MLP distributable cash flow, which is a non-GAAP financial measure, as defined in Regulation G of the U.S. Securities Exchange Act of 1934, as amended. We report our financial results in accordance with U.S. generally accepted accounting principles ("GAAP"), but believe that certain non-GAAP financial measures, such as MLP distributable cash flow, provide useful supplemental information to investors regarding the underlying business trends and performance of our ongoing operations and are useful for period-over-period comparisons of such operations. These non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the financial measures prepared in accordance with GAAP. A reconciliation of MLP distributable cash flow to net income and net cash provided by operating activities can be found in the financial schedules at the end of this release. We define distributable cash flow as net income plus depreciation and amortization, less contributions from turnaround reserves and maintenance capital expenditures. We define MLP distributable cash flow as distributable cash flow attributable to periods subsequent to the date of our initial public offering less distributable cash flow attributable to Westlake Chemical Corporation's noncontrolling interest in Westlake Chemical OpCo LP. Because MLP distributable cash flow may be defined differently by other companies in our industry, our definition of MLP distributable cash flow may not be comparable to similarly titled measures of other companies.
Westlake Chemical Partners is a limited partnership formed by Westlake Chemical Corporation to operate, acquire and develop facilities for the processing of natural gas liquids as well as other qualifying activities. Headquartered in Houston, Texas, the Partnership owns a 13.3% interest in Westlake Chemical OpCo LP. Westlake Chemical OpCo LP's assets include three facilities in Calvert City, Kentucky, and Lake Charles, Louisiana which process ethane and propane into ethylene, and an ethylene pipeline. For more information about Westlake Chemical Partners LP, please visit http://www.wlkpartners.com.
A conference call to discuss Westlake Chemical Partners' fourth quarter and full year 2015 results will be held Tuesday, February 23, 2016 at 12:00 p.m. Eastern Time (11:00 a.m. Central Time). To access the conference call, dial (855) 765-5686 or (234) 386-2848 for international callers, approximately 10 minutes prior to the scheduled start time and reference passcode 41990126.
A replay of the conference call will be available beginning two hours after its conclusion until 11:59 p.m. Eastern Time on Tuesday, March 1, 2016. To hear a replay, dial (855) 859-2056 or (404) 537-3406 for international callers. The replay passcode is 41990126.
Includes amounts for the pre-IPO period from January 1, 2014 through August 3, 2014 and post-IPO period from August 4, 2014 through December 31, 2014.
Net income per common unit for the twelve months ended December 31, 2014 is based on the net income subsequent to the IPO, being the period from August 4, 2014 through December 31, 2014.
Includes the amounts for the pre-IPO period from January 1, 2014 through August 3, 2014 and post-IPO period from August 4, 2014 through December 31, 2014.
Westlake Partners' initial public offering was on August 4, 2014. The balances for the twelve months ended December 31, 2014 include amounts for the period from August 4, 2014 through December 31, 2014 only.
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