- Company name
- Westlake
- Sector
- Chemicals & building products
- About
- Westlake makes chemicals, plastics and building products. Its Performance and Essential Materials (PEM) segment makes polyethylene, PVC resin and other chemicals in North America, Europe and Asia. Its Housing and Infrastructure Products (HIP) segment makes PVC pipe and fittings and other building products, mostly for North America. In Q2 2026, it bought a PVC and VCM production site in Wilhelmshaven, Germany. Net sales were $3.3 billion in Q2 2026. Its headquarters are in Houston. Jean-Marc Gilson is President and CEO.
- Thesis
- The market prices Westlake for weak chemical prices and slow homebuilding. PEM had operating losses in Q2 2025 and in Q1 2026. Prices rose in Q2 2026 after the conflict with Iran disrupted supply through the Strait of Hormuz, and PEM EBITDA reached $416 million. But on September 29, 2026, Westlake said that North American PVC and polyethylene prices in Q3 were lower than in Q2, that higher diesel costs and lower housing volumes hurt HIP, and that Q3 results would be lower than Q2. Chemical production in Europe faces weak demand, high energy costs and imports from Asia, and Westlake will close its Cologne PVC plant in Q1 2027. For the gap to close, three things must be true. The three-pillar profitability improvement plan must deliver its $600 million operating income benefit. PEM must stay profitable when the price spike of Q2 2026 fades, with help from low-cost North American feedstock and energy. HIP must keep its pipe and fittings growth from infrastructure work while housing is slow. The Q3 2026 report, estimated for about November 4, 2026, shows how far earnings fell. The 2027 results show whether the plan holds through a full year. Because chemical cycles are long, the gap will probably close only over several years. The main reason it may not close is a long period of global oversupply in PVC and polyethylene.
- Risks
- PEM earnings move with global prices of PVC, polyethylene and other chemicals. Prices rose after the Iran conflict in Q2 2026 and then fell in Q3. Global oversupply can keep margins low for years.
HIP sells mostly into North American housing and infrastructure. Slow homebuilding and higher freight costs reduced HIP volumes and margins in Q3 2026.
European chemical plants face high energy costs and imports from Asia. The Cologne closure costs about $205 million, and more closures can follow.
Westlake paid $67 million in Q1 2026 to settle litigation with direct purchasers of PVC pipe and fittings. More legal claims can cause new charges.
- Balance sheet
- Cash: $1.9B
Debt: $5.1B
Net debt: $3.2B
Interest cover: 1.7×
Undrawn credit line: $1.5B
Debt due within 12 months: $0.0M
Westlake funds its business with senior notes and has a $1.5 billion revolving credit facility. At June 30, 2026, total debt was $5.07 billion, with nothing due within 12 months, after Westlake redeemed the remaining $496 million of its 3.60% senior notes due 2026 in Q2. Cash and cash equivalents were $1.64 billion and available-for-sale securities were $209 million. In Q2 2026, Westlake replaced its revolving credit facility, which was to expire in 2027, with a new $1.5 billion facility that expires in 2031. Interest cover is income from operations divided by interest expense for the first six months of 2026, which includes the operating loss of Q1. The Cologne closure needs about $100 million of cash over several years.
As of 2026-06-30.
- Checkpoints
- Nov 4, 2026 (estimate): Q3 2026 earnings: how far earnings fell. Pending. Watch: PEM EBITDA that stays positive and well above the levels of 2025 passes; a return to PEM losses fails.
Q1 2027 (estimate): Cologne PVC plant closes. Pending. Watch: The plant closes in Q1 2027 within the expected charges of about $205 million passes; higher costs or a delay fail.
- Recent events
- 2026-09-29: Westlake said it will close its Cologne, Germany PVC plant, with about 165,000 metric tons of annual capacity, in Q1 2027. It expects pre-tax charges of about $205 million, of which about $100 million is cash. It also said that Q3 2026 results will be lower than Q2, because PVC and polyethylene prices fell and HIP had higher freight costs and lower volumes.
2026-08-04: Westlake reported Q2 2026 results. Net sales were $3.3 billion, net income was $260 million, or $2.01 per share, and EBITDA was $679 million. PEM EBITDA rose to $416 million on higher prices. Westlake redeemed about $500 million of 3.60% senior notes due 2026 and replaced its revolving credit facility with a new $1.5 billion facility that expires in 2031.
2026-06-15: Jonathan Baksht became Senior Vice President and Chief Financial Officer. He succeeded M. Steven Bender, who will retire by the end of 2026.
2026-05-05: Westlake reported Q1 2026 results with a net loss of $169 million, or $1.31 per share. The results included a $67 million charge to settle litigation with direct purchasers of PVC pipe and fittings and $18 million of charges for facility shutdowns.