Westlake Chemical Corporation reported net income for the three months ended December 31, 2012 of $95.3 million, or $1.42 per diluted share, compared to net income of $26.4 million, or $0.40 per diluted share, reported for the fourth quarter of 2011.
Net sales for the three months ended December 31, 2012 of $801.0 million decreased $58.2 million compared to net sales of $859.2 million in the fourth quarter of 2011, primarily due to lower sales volumes for feedstocks, polyethylene and styrene, partially offset by higher prices for styrene and higher building products sales volumes.
Income from operations was $156.2 million for the fourth quarter of 2012 compared to $50.5 million for the fourth quarter of 2011. Fourth quarter of 2012 income from operations was higher primarily as a result of significantly lower feedstock costs, which resulted in higher integrated margins for our Olefins and Vinyls segments.
Net income for the fourth quarter of 2012 of $95.3 million, or $1.42 per diluted share, increased $8.3 million from the $87.0 million net income, or $1.30 per diluted share, reported for the third quarter of 2012.
Net sales in the fourth quarter of 2012 of $801.0 million decreased $20.2 million compared to net sales of $821.2 million in the third quarter of 2012, mainly attributable to lower sales volumes for polyethylene, PVC resin and building products which was partially offset by higher styrene sales volume and higher sales prices for most of our major products.
Fourth quarter 2012 income from operations was $156.2 million as compared to $142.5 million reported for the third quarter of 2012, an increase of $13.7 million. This increase was primarily the result of lower average feedstock costs and higher sales prices, partially offset by lower sales volumes.
For the year ended December 31, 2012, Westlake had net income of $385.6 million, or $5.75 per diluted share, on net sales of $3,571.0 million. This represents an increase in net income of $126.6 million, or $1.88 per diluted share, from 2011 net income of $259.0 million, or $3.87 per diluted share, on net sales of $3,619.8 million in 2011.
Net sales in 2012 decreased $48.8 million from net sales in 2011, primarily due to lower sales prices for most of our major products, offset by higher sales volumes of feedstock, building products and caustic. Income from operations was $615.4 million for the year ended December 31, 2012 as compared to $446.8 million for 2011, an increase of $168.6 million.
Income from operations benefited primarily from a significant decrease in feedstock and energy costs. Industry ethane prices decreased 48.1% and industry propane prices decreased 31.5% in 2012 as compared to 2011.
Albert Chao, President and Chief Executive Officer, said, "We are pleased to report record annual and fourth quarter earnings benefiting from lower feedstock costs. Increased North American shale gas production resulted in lower ethane-based ethylene production costs in 2012. We believe North American shale gas production will continue to give our business a significant cost advantage over global naphtha-based ethylene producers for the foreseeable future. Westlake is investing to capture this advantageous ethane and natural gas cost position with the expansion of our ethylene units and additions to our chlor-alkali capacity."
