UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
☒
xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2017March 31, 2024
or
☐
¨TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from                    to                    
Commission File No. 001-32260
Westlake Chemical Corporation
(Exact name of Registrant as specified in its charter)

Delaware76-0346924

Delaware76-0346924
(State or other jurisdiction of

incorporation or organization)
(I.R.S. Employer

Identification Number)
2801 Post Oak Boulevard, Suite 600
Houston, Texas 77056
(Address of principal executive offices, including zip code)
(713) 960-9111
(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.01 par valueWLKThe New York Stock Exchange
1.625% Senior Notes due 2029WLK29The New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     YesxNo¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     YesxNo¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer",filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act (Check one):
Act:
Large accelerated filerxxAccelerated filer¨☐
Non-accelerated filer
¨  (Do not check if a smaller reporting company)
Smaller reporting company¨☐
Emerging growth company¨☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)     Yes¨   ☐     Nox
The number of shares outstanding of the registrant's sole class of common stock as of October 31, 2017April 25, 2024 was 129,107,447.128,569,968.



INDEX

ItemPage
PART I. FINANCIAL INFORMATION
1) Financial Statements
1
2) Management's Discussion and Analysis of Financial Condition and Results of Operations
39
3) Quantitative and Qualitative Disclosures about Market Risk
53
4) Controls and Procedures
55
PART II. OTHER INFORMATION
1) Legal Proceedings
56
1A) Risk Factors
56
2) Unregistered Sales of Equity Securities and Use of Proceeds
56
6) Exhibits
57



Table of Contents


TABLE OF CONTENTS
Page
PART I. FINANCIAL INFORMATION
Item
1)
Financial Statements
1
2)
Management's Discussion and Analysis of Financial Condition and Results of Operations
22
3)
Quantitative and Qualitative Disclosures about Market Risk
34
4)
Controls and Procedures
35
PART II. OTHER INFORMATION
1)
Legal Proceedings
35
1A)
Risk Factors
35
2)
Unregistered Sales of Equity Securities and Use of Proceeds
36
5)
Other Information
36
6)
Exhibits
37


Table of Contents

PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
1
Table of Contents

WESTLAKE CHEMICAL CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
  September 30,
2017		 December 31,
2016
     
  
(in thousands of dollars, except
par values and share amounts)
ASSETS    
Current assets    
Cash and cash equivalents $678,233
 $459,453
Accounts receivable, net 1,142,979
 938,743
Inventories 834,835
 801,100
Prepaid expenses and other current assets 34,860
 48,493
Restricted cash 8,626
 160,527
Total current assets 2,699,533
 2,408,316
Property, plant and equipment, net 6,343,637
 6,420,062
Other assets, net    
Goodwill 1,011,342
 946,553
Customer relationships, net 635,884
 611,615
Other intangible assets, net 166,166
 175,839
Deferred charges and other assets, net 387,563
 327,868
Total other assets, net 2,200,955
 2,061,875
Total assets $11,244,125
 $10,890,253
LIABILITIES AND EQUITY    
Current liabilities    
Accounts payable $560,804
 $496,259
Accrued liabilities 609,472
 537,483
Term loan —
 149,341
Total current liabilities 1,170,276
 1,183,083
Long-term debt, net 3,349,402
 3,678,654
Deferred income taxes 1,660,914
 1,650,575
Pension and other post-retirement benefits 367,705
 364,819
Other liabilities 144,329
 121,077
Total liabilities 6,692,626
 6,998,208
Commitments and contingencies (Note 18) 

 

Stockholders' equity    
Preferred stock, $0.01 par value, 50,000,000 shares authorized;
no shares issued and outstanding
 —
 —
Common stock, $0.01 par value, 300,000,000 shares authorized; 134,651,380 and
134,651,380 shares issued at September 30, 2017 and December 31, 2016,
respectively
 1,347
 1,347
Common stock, held in treasury, at cost; 5,551,693 and 5,726,377 shares at
September 30, 2017 and December 31, 2016, respectively
 (314,694) (319,339)
Additional paid-in capital 558,423
 550,641
Retained earnings 3,837,644
 3,412,286
Accumulated other comprehensive loss (13,946) (121,306)
Total Westlake Chemical Corporation stockholders' equity 4,068,774
 3,523,629
Noncontrolling interests 482,725
 368,416
Total equity 4,551,499
 3,892,045
Total liabilities and equity $11,244,125
 $10,890,253
March 31,
2024		December 31,
2023
(in millions of dollars, except par values and share amounts)
ASSETS
Current assets
Cash and cash equivalents$3,108 $3,304 
Accounts receivable, net1,691 1,601 
Inventories1,661 1,622 
Prepaid expenses and other current assets66 82 
Total current assets6,526 6,609 
Property, plant and equipment, net8,523 8,519 
Operating lease right-of-use assets706 697 
Goodwill2,037 2,041 
Customer relationships, net889 910 
Other intangible assets, net481 493 
Equity method investments1,104 1,115 
Other assets, net694 651 
Total assets$20,960 $21,035 
LIABILITIES AND EQUITY
Current liabilities
Accounts payable$891 $877 
Accrued and other liabilities1,464 1,614 
Current portion of long-term debt, net300 299 
Total current liabilities2,655 2,790 
Long-term debt, net4,590 4,607 
Deferred income taxes1,544 1,560 
Pension and other post-retirement benefits353 363 
Operating lease liabilities622 611 
Other liabilities343 340 
Total liabilities10,107 10,271 
Commitments and contingencies (Note 13)
Stockholders' equity
Preferred stock, $0.01 par value, 50,000,000 shares authorized; no shares issued and outstanding— — 
Common stock, $0.01 par value, 300,000,000 shares authorized; 134,651,380 and 134,651,380 shares issued at March 31, 2024 and December 31, 2023, respectively1 1 
Common stock, held in treasury, at cost; 6,082,171 and 6,439,289 shares at March 31, 2024 and December 31, 2023, respectively(414)(435)
Additional paid-in capital624 630 
Retained earnings10,252 10,143 
Accumulated other comprehensive loss(132)(98)
Total Westlake Corporation stockholders' equity10,331 10,241 
Noncontrolling interests522 523 
Total equity10,853 10,764 
Total liabilities and equity$20,960 $21,035 
The accompanying notes are an integral part of these consolidated financial statements.

2
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WESTLAKE CHEMICAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended March 31,
Three Months Ended March 31,
Three Months Ended March 31,
202420242023
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
        
 (in thousands of dollars, except per share data and share amounts)
(in millions of dollars, except per share data and share amounts)
(in millions of dollars, except per share data and share amounts)
(in millions of dollars, except per share data and share amounts)
Net sales $2,108,889
 $1,279,028
 $6,030,666
 $3,340,276
Cost of sales 1,610,837
 1,076,895
 4,759,637
 2,641,192
Gross profit 498,052
 202,133
 1,271,029
 699,084
Selling, general and administrative expenses 125,642
 72,729
 379,919
 179,757
Transaction and integration-related costs 6,663
 82,841
 22,949
 90,550
Amortization of intangibles
Amortization of intangibles
Amortization of intangibles
Restructuring, transaction and integration-related costs
Income from operations 365,747
 46,563
 868,161
 428,777
Other income (expense)        
Interest expense (40,036) (24,366) (118,784) (36,966)
Interest expense
Interest expense
Other income, net 2,058
 41,265
 6,591
 52,091
Income before income taxes 327,769
 63,462
 755,968
 443,902
Provision for (benefit from) income taxes 108,619
 (6,552) 232,690
 129,332
Provision for income taxes
Net income 219,150
 70,014
 523,278
 314,570
Net income attributable to noncontrolling interests 8,318
 4,352
 21,429
 14,656
Net income attributable to Westlake Chemical
Corporation
 $210,832
 $65,662
 $501,849
 $299,914
Earnings per common share attributable to Westlake
Chemical Corporation:
        
Net income attributable to Westlake Corporation
Earnings per common share attributable to Westlake Corporation:
Basic
Basic
Basic $1.62
 $0.51
 $3.87
 $2.31
Diluted $1.61
 $0.51
 $3.85
 $2.29
Weighted average common shares outstanding:        
Basic 129,069,186
 128,793,661
 129,033,597
 129,519,577
Basic
Basic
Diluted 129,888,968
 129,379,956
 129,789,965
 130,103,897
Dividends per common share $0.2100
 $0.1906
 $0.5912
 $0.5536
The accompanying notes are an integral part of these consolidated financial statements.

3
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WESTLAKE CHEMICAL CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017
2016
         
  (in thousands of dollars)
Net income $219,150
 $70,014
 $523,278
 $314,570
Other comprehensive income (loss), net of income taxes        
Pension and other post-retirement benefits liability        
Pension and other post-retirement reserves
   adjustment (excluding amortization)
 —
 (206) —
 (412)
Amortization of benefits liability 529
 369
 1,600
 1,072
Income tax provision on pension and other post-
   retirement benefits liability
 (193) (60) (543) (251)
Foreign currency translation adjustments        
Foreign currency translation 39,714
 6,453
 108,166
 15,758
Income tax provision on foreign currency
   translation
 (76) —
 (1,603) —
Net unrealized holding gains (losses) on investments        
Unrealized holding gains on investments —
 1,550
 —
 61,524
Reclassification of net realized gains to net
   income
 —
 (52,401) —
 (53,720)
Income tax provision on available-for-sale
   investments
 —
 18,270
 —
 (2,805)
Other (96) —
 (260) —
Other comprehensive income (loss), net of income taxes 39,878
 (26,025) 107,360
 21,166
Comprehensive income 259,028
 43,989
 630,638
 335,736
Comprehensive income attributable to
   noncontrolling interests, net of tax of $846 and
   $0 for the three months ended September 30, 2017
   and 2016, respectively; and $2,467 and $0 for
   the nine months ended September 30, 2017 and
   2016, respectively.
 4,628
 4,352
 17,288
 14,656
Comprehensive income attributable to Westlake
   Chemical Corporation
 $254,400
 $39,637
 $613,350
 $321,080
Three Months Ended March 31,
20242023
(in millions of dollars)
Net income$185 $407 
Other comprehensive income (loss), net of income taxes
Pension and other post-retirement benefits liability
Pension and other post-retirement benefits reserves adjustment1 — 
Foreign currency translation adjustments
Foreign currency translation(33)20 
Income tax (provision) benefit on foreign currency translation(4)3 
Other, net of income tax— (1)
Other comprehensive income (loss), net of income taxes(36)22 
Comprehensive income149 429 
Comprehensive income attributable to noncontrolling interests, net of tax of $1 and $1 for the three months ended March 31, 2024 and 2023, respectively9 13 
Comprehensive income attributable to Westlake Corporation$140 $416 
The accompanying notes are an integral part of these consolidated financial statements.

4
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WESTLAKE CHEMICAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWSCHANGES IN STOCKHOLDERS' EQUITY
(Unaudited)

  Nine Months Ended September 30,
  2017 2016
     
  (in thousands of dollars)
Cash flows from operating activities    
Net income $523,278
 $314,570
Adjustments to reconcile net income to net cash provided by operating activities    
Depreciation and amortization 448,533
 227,193
Provision for doubtful accounts 3,771
 1,176
Amortization of debt issuance costs 3,471
 1,018
Stock-based compensation expense 16,740
 6,588
Loss from disposition of property, plant and equipment 14,319
 6,541
Gains realized on previously held shares of Axiall common stock and from sales of securities —
 (53,720)
Write-off of debt issuance costs 659
 —
Deferred income taxes 23,294
 105,910
Windfall tax benefits from share-based payment arrangements —
 (1,190)
Dividends in excess of income from equity method investments (2,132) (61)
Gain on involuntary conversion of assets (1,672) —
Other losses (gains), net (6,659) 833
Changes in operating assets and liabilities, net of effect of business acquisitions    
Accounts receivable (185,153) (92,311)
Inventories 23,945
 (6,124)
Prepaid expenses and other current assets 16,788
 1,631
Accounts payable 60,899
 34,109
Accrued liabilities 57,419
 73,157
Other, net (34,836) (75,160)
Net cash provided by operating activities 962,664
 544,160
Cash flows from investing activities    
Acquisition of business, net of cash acquired —
 (2,437,829)
Additions to property, plant and equipment (414,271) (467,330)
Additions to cost method investment (47,000) (4,000)
Proceeds from disposition of assets 171
 213
Proceeds from involuntary conversion of assets 1,672
 —
Proceeds from sales and maturities of securities —
 662,938
Purchase of securities —
 (138,422)
Settlements of derivative instruments (7) (4,655)
Net cash used for investing activities (459,435) (2,389,085)
Cash flows from financing activities    
Debt issuance costs (376) (35,207)
Dividends paid (76,491) (71,933)
Distributions to noncontrolling interests (20,767) (12,300)
Net proceeds from issuance of Westlake Chemical Partners LP common units 110,739
 —
Proceeds from debt issuance —
 1,428,512
Proceeds from issuance of notes payable 5,946
 5,597
Proceeds from term loan and drawdown of revolver 225,000
 600,000
Restricted cash associated with term loan 154,000
 (154,000)
Repayment of term loan (150,000) —
Repayment of notes payable (6,695) (10,602)
Repayment of revolver (550,000) (125,000)
Repurchase of common stock for treasury —
 (67,406)
Other 2,204
 2,840
Net cash provided by (used for) financing activities (306,440) 1,560,501
Effect of exchange rate changes on cash and cash equivalents 21,991
 2,418
Net increase (decrease) in cash and cash equivalents 218,780
 (282,006)
Cash and cash equivalents at beginning of period 459,453
 662,525
Cash and cash equivalents at end of period $678,233
 $380,519
Common StockCommon Stock, Held in Treasury
Number of SharesAmountNumber of SharesAt CostAdditional Paid-in CapitalRetained
Earnings		Accumulated
Other
Comprehensive
Income (Loss)		Noncontrolling
Interests		Total
(in millions of dollars, except share amounts)
Balances at December 31, 2023134,651,380 $1 6,439,289 $(435)$630 $10,143 $(98)$523 $10,764 
Net income— — — — — 174 — 11 185 
Other comprehensive income— — — — — — (34)(2)(36)
Shares issued—stock-based compensation— — (357,118)21 (14)— — — 7 
Stock-based compensation— — — — 8 — — — 8 
Dividends declared— — — — — (65)— — (65)
Distributions to noncontrolling interests— — — — — — — (10)(10)
Balances at March 31, 2024134,651,380 $1 6,082,171 $(414)$624 $10,252 $(132)$522 $10,853 
The accompanying notes are an integral part of these consolidated financial statements.

45
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WESTLAKE CHEMICALCORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(Unaudited)

Common StockCommon Stock, Held in Treasury
Number of SharesAmountNumber of SharesAt CostAdditional Paid-in CapitalRetained
Earnings		Accumulated
Other
Comprehensive
Loss		Noncontrolling InterestsTotal
(in millions of dollars, except share amounts)
Balances at December 31, 2022134,651,380 $1 7,278,651 $(467)$601 $9,885 $(89)$534 $10,465 
Net income— — — — — 394 — 13 407 
Other comprehensive loss— — — — — — 22 — 22 
Common stock repurchased— — 201,742 (22)— — — — (22)
Shares issued—stock-based compensation— — (469,404)24 (20)— — — 4 
Stock-based compensation— — — — 9 — — — 9 
Dividends declared— — — — — (47)— — (47)
Distributions to noncontrolling interests— — — — — — — (10)(10)
Balances at March 31, 2023134,651,380 $1 7,010,989 $(465)$590 $10,232 $(67)$537 $10,828 
The accompanying notes are an integral part of these consolidated financial statements.
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WESTLAKE CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended March 31,
20242023
(in millions of dollars)
Cash flows from operating activities
Net income$185 $407 
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization273 267 
Stock-based compensation expense9 9 
Loss from disposition and write-off of property, plant and equipment5 6 
Deferred income taxes(22)(16)
Other gains, net(3)(4)
Changes in operating assets and liabilities, net of effect of business acquisitions
Accounts receivable(97)(15)
Inventories(47)34 
Prepaid expenses and other current assets15 6 
Accounts payable63 (20)
Accrued and other liabilities(111)(69)
Other, net(101)(93)
Net cash provided by operating activities169 512 
Cash flows from investing activities
Additions to investments in unconsolidated subsidiaries(1)(1)
Additions to property, plant and equipment(272)(267)
Other, net1 5 
Net cash used for investing activities(272)(263)
Cash flows from financing activities
Distributions to noncontrolling interests(10)(10)
Dividends paid(65)(47)
Proceeds from exercise of stock options7 5 
Repurchase of common stock for treasury— (22)
Other, net(6)(1)
Net cash used for financing activities(74)(75)
Effect of exchange rate changes on cash, cash equivalents and restricted cash(18)9 
Net increase (decrease) in cash, cash equivalents and restricted cash(195)183 
Cash, cash equivalents and restricted cash at beginning of period3,319 2,246 
Cash, cash equivalents and restricted cash at end of period$3,124 $2,429 
The accompanying notes are an integral part of these consolidated financial statements.
7
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WESTLAKE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(in thousandsmillions of dollars, except share amounts and per share data)



1. 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 December 31, 2016 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, 20162023 (the "2016"2023 Form 10-K"), filed with the SEC on February 22, 2017.2024. 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, 2016.2023. The Company operates as an integrated global manufacturer and marketer of performance and essential materials and housing and infrastructure products. These products include some of the most widely used materials in the world, which are fundamental to many diverse consumer and industrial markets, including residential construction, flexible and rigid packaging, automotive products, healthcare products, materials used in turbines to generate wind energy, water treatment, coatings as well as other durable and non-durable goods. The Company's customers range from large chemical processors and plastics fabricators to small construction contractors, municipalities and supply warehouses throughout North America, Europe and Asia.
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 September 30, 2017,March 31, 2024, its results of operations for the three and nine months ended September 30, 2017March 31, 2024 and 20162023, and the changes in its cash position for the ninethree months ended September 30, 2017March 31, 2024 and 2016.2023.
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, 20172024 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.
RecentRecently Issued Accounting Pronouncements
Revenue from Contracts with CustomersIncome Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU No. 2014-09)No.2023-09)
In May 2014,December 2023, the Financial Accounting Standards Board ("FASB") issued an accounting standards update on a comprehensive new revenue recognition standard that will supersedeNo. 2023-09 to enhance the existing revenue recognition guidance. The new accounting guidance creates a framework by whichtransparency and decision-usefulness of income tax disclosures and to provide information to better assess how an entity will allocateentity's operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. For public business entities, the transaction price to separate performance obligations and recognize revenue when each performance obligation is satisfied. Under the new standard, entities will be required to use judgment and make estimates, including identifying performance obligationsamendments in a contract, estimating the amount of variable consideration to include in the transaction price, allocating the transaction price to each separate performance obligation and determining when an entity satisfies its performance obligations. The standard allows for either "full retrospective" adoption, meaning that the standard is applied to all of the periods presented with a cumulative catch-up as of the earliest period presented, or "modified retrospective" adoption, meaning the standard is applied only to the most current period presented in the financial statements with a cumulative catch-up as of the current period. In 2016, the FASB issued various additional authoritative guidance for the new revenue recognition standard. The accounting standard will bethis update are effective for reportingannual periods beginning after December 15, 2017.2024. The Company is in the process of evaluating the impact of this standard on the Company's disclosures in the financial statements.
Business Combinations—Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement (ASU 2023-05)
In August 2023, the FASB issued accounting standards update No. 2023-05 to address the accounting for contributions made to a joint venture, upon formation, in a joint venture's financial statements, and to (1) provide decision-useful information to investors and other allocators of capital (collectively, investors) in a joint venture's financial statements and (2) reduce diversity in practice. Under the ASU, upon formation, a joint venture should recognize and initially measure its assets and liabilities at fair value (with exceptions to fair value measurement that are consistent with guidance for business combinations). The amendments in this update become effective for all joint venture formations with a formation date on or after January 1, 2025. Additionally, a joint venture that was formed before January 1, 2025 may elect to apply the newamendments retrospectively if it has sufficient information. Early adoption is permitted in any interim or annual period in which financial statements have not yet been issued (or made available for issuance), either prospectively or retrospectively. The Company does not expect that this accounting standard will have on its consolidated financial position, results of operations and cash flows. The Company has completed a preliminary assessment including detailed review of a representative sample of contracts with customers. The Company does not believe thatmaterial impact, upon adoption, of the new accounting standard will materially impact timing or amounts of revenue recognized for the majority of its sales. The Company intends to elect the modified retrospective method of adoption.

5

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Recognition and Measurement of Financial Assets and Financial Liabilities (ASU No. 2016-01)
In January 2016, the FASB issued an accounting standards update making certain changes principally to the current guidance for equity investments, financial liabilities under the fair value option and the presentation and disclosure requirements for financial instruments. Among other things, the guidance (1) requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value, with changes in fair value recognized in net income; (2) provide entities with a policy election to record equity investments without readily determinable fair values at cost, less impairment, and subsequent adjustments for observable price changes (changes in the basis of these equity investments to be reported in net income); (3) requires an entity that has elected the fair value option for financial liabilities to recognize changes in fair value due to instrument-specific credit risk separately in other comprehensive income; (4) clarified current guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities; and (5) requires specific disclosure pertaining to financial assets and financial liabilities in the financial statements. The accounting standard will be effective for reporting periods beginning after December 15, 2017. The Company is in the process of evaluating the impact that the new accounting guidance will have on its consolidated financial position, results of operations and cash flows.
Leases (ASU No. 2016-02)
In February 2016, the FASB issued an accounting standards update on a new lease standard that will supersede the existing lease guidance. The standard requires a lessee to recognize assets and liabilities related to long-term leases that are classified as operating leases under current guidance on its balance sheet. An asset would be recognized related to the right to use the underlying asset and a liability would be recognized related to the obligation to make lease payments over the term of the lease. The standard also requires expanded disclosures related to leases. The accounting standard will be effective for reporting periods beginning after December 15, 2018. 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.
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 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. The accounting standard will be effective for reporting periods beginning after December 15, 2019 and is not expected to have a material impact on the Company's consolidated financial position, results of operations and cash flows.
Cash Flows (ASU No. 2016-15)
In August 2016, the FASB issued an accounting standards update providing new guidance on the classification of certain cash receipts and payments including debt extinguishment costs, debt prepayment costs, settlement of zero-coupon debt instruments, contingent consideration payments, proceeds from the settlement of insurance claims and life insurance policies and distributions received from equity method investees in the statement of cash flows. This update is required to be applied using the retrospective transition method to each period presented unless it is impracticable to be applied retrospectively. In such situation, this guidance is to be applied prospectively. The accounting standard will be effective for reporting periods beginning after December 15, 2017 and is not expected to have a material impact on the Company's consolidated financial position, results of operations and cash flows.
Cash Flows (ASU No. 2016-18)
In November 2016, the FASB issued an accounting standards update to clarify certain existing principles in Accounting Standards Codification ("ASC") 230, Cash flows, including providing additional guidance related to transfers between cash and restricted cash and how entities present, in their statement of cash flows, the cash receipts and cash payments that directly affect the restricted cash accounts. The accounting standard will be effective for reporting periods beginning after December 15, 2017. Upon adoption of the accounting standards update, the Company will retrospectively adjust its financial statements to reflect restricted cash in the beginning and ending cash and restricted cash balances within the statements of cash flows. Transfers between cash and restricted cash will be excluded from net changes in cash and cash equivalents within the statements of cash flows.

68

Table of Contents
WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousandsmillions of dollars, except share amounts and per share data)

Recently Adopted Accounting Standards
Business CombinationsSegment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (ASU No. 2017-01)2023-07)
In January 2017,November 2023, the FASB issued an accounting standards update No. 2023-07 to assistimprove reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The update requires public entities with evaluating when a set of transferred assetsto disclose, on an annual and activities is a business. The guidance requires an entityinterim basis, significant segment expenses that are regularly provided to evaluate if substantially allthe chief operating decision maker (CODM), the title and position of the fair valueCODM and an explanation of how the gross assets acquired is concentrated in a single identifiable asset or a groupCODM uses the reported measure(s) of similar identifiable assets; if so, the set of transferred assets and activities is not a business. The guidance also requires a business to include at least one substantive process and narrows the definition of outputs by more closely aligning it with how outputs are described in the ASC 606, Revenue from contracts with customers. The accounting standard will be effective for reporting periods beginning after December 15, 2017 and is not expected to 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 will be effective for reporting periods beginning after December 15, 2019 and is not expected to have a material impact on the Company's consolidated financial position, results of operations and cash flows.
Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (ASU No. 2017-05)
In February 2017, the FASB issued an accounting standards update to clarify the scope of guidance related to other income—gains and losses from the derecognition of nonfinancial assets, and to add guidance for partial sales of nonfinancial assets. The new guidance clarifies that an in substance nonfinancial asset is an asset or group of assets for which substantially all of the fair value consists of nonfinancial assets and the group or subsidiary is not a business. The guidance also outlines that when an entity transfers its controlling interest in a nonfinancial asset, but retains a noncontrolling interest, it will measure the retained interest at fair value resulting in full gainsegment profit or loss recognition upon sale of the controlling interest. The accounting standard will be effective for reporting periods beginning after December 15, 2017in assessing segment performance and is not expecteddeciding how to have a material impact on the Company's consolidated financial position, results of operations and cash flows.
Compensation - Retirement Benefits (ASU No. 2017-07)
In March 2017, the FASB issued an accounting standards update to improve the presentation of net periodic pension cost and net periodic postretirement benefit cost. The new guidance requires employers to disaggregate the service cost component from the other components of net periodic benefit cost and report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The amendments also allow only the service cost component to be eligible for capitalization when applicable. The accounting standard will be effective for reporting periods beginning after December 15, 2017. The Company is in the process of evaluating the impact that the new accounting guidance will have on its consolidated financial position, results of operations and cash flows.
Compensation - Stock Compensation (ASU No. 2017-09)
In May 2017, the FASB issued the accounting standards update to provide clarity and reduce both (1) diversity in practice and (2) cost and complexity when applying the guidance in Topic 718, Compensation-Stock Compensation, to a change to the terms or conditions of a share-based payment award.allocate resources. The amendments in this update provide guidance about which changes to the terms or conditions of a share-based payment award require the application of modification accounting in Topic 718. Essentially, an entity will not have to account for the effects of a modification if: (1) the fair value of the modified award is the same immediately before and after the modification; (2) the vesting conditions of the modified award are the same immediately before and after the modification; and (3) the classification of the modified award as either an equity instrument or liability instrument is the same immediately before and after the modification. This update is to be applied prospectively to an award modified on or after the adoption date. The accounting standard will be effective for reporting periodspublic entities in fiscal years beginning after December 15, 2017.2023, and interim periods within fiscal years beginning after December 15, 2024, and are to be applied retrospectively to all prior periods presented in the financial statements. Early adoption is permitted. The Company isadopted this accounting standard effective January 1, 2024, and the adoption will result in additional segment disclosures in the process of evaluating the impact that the new accounting guidance will have on itsCompany's annual consolidated financial position, results of operationsstatements for the year ending December 31, 2024 and cash flows.the interim periods thereafter.

7

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Derivatives and Hedging - Targeted Improvements to Accounting for Hedging ActivitiesLeases (Topic 842): Common Control Arrangements (ASU No. 2017-12)2023-01)
In August 2017,March 2023, the FASB issued an accounting standards update No. 2023-01 to improve financial reportingamend certain provisions of hedging relationships,ASC 842 that apply to better portrayarrangements between related parties under common control. The update requires all companies to amortize leasehold improvements associated with common control leases over the economic resultsasset's useful life to the common control group regardless of an entity's risk management activitiesthe lease term. The amendment in the financial statements and to simplify application of hedge accounting guidance. The accounting standard eliminates certain hedge effectiveness measurement and reporting requirements and expands the types of permissible hedging strategies. The accounting standard will bethis update is effective for reporting periodsall entities in fiscal years beginning after December 15, 2018, and2023, including interim periods within those fiscal years. Early application is permitted in any interim period after issuance, to be applied retrospectively to the beginning of the fiscal year. The Company is in the process of evaluating the impact that the new accounting guidance will have on its consolidated financial position, results of operations and cash flows.
Recently Adopted Accounting Standards
Investments - Equity Method and Joint Ventures (ASU No. 2016-07)
In March 2016, the FASB issued an accounting standards update providing new guidance for the accounting for equity method investments. The new guidance eliminates the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. In addition, the guidance requires that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor's previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. Therefore, upon qualifying for the equity method of accounting, no retroactive adjustment of the investment is required. The accounting standard became effective for reporting periods beginning after December 15, 2016.permitted. The Company adopted this accounting standard effective January 1, 20172024, and the adoption did not have a material impact on the Company's consolidated financial position, results of operations and cash flows.
Stock Compensation (ASU No. 2016-09)
In March 2016, the FASB issued an accounting standards update to simplify several aspects of the accounting for share-based payment transactions, including income tax consequences, classifications of awards as either equity or liabilities and certain related classifications on the statement of cash flows. In addition, the new guidance permits entities to make an accounting policy election for the impact of forfeitures on the recognition of expense for share-based payment awards. Forfeitures can be estimated, as required prior to adoption of the accounting standards update, or recognized when they occur. The accounting standard became effective for reporting periods beginning after December 15, 2016. 2. Financial Instruments
Cash Equivalents
The Company adopted this accounting standard effective January 1, 2017had $544 and elected to continue estimating forfeitures$360 of held-to-maturity securities with original maturities of three months or less, primarily consisting of corporate debt securities, classified as required prior to adoption of the accounting standards update. The adoption did not have a material impact on the Company's consolidated financial position, results of operationscash equivalents at March 31, 2024 and cash flows.
Amendments to the Consolidation Analysis (ASU No. 2016-17)
In October 2016, the FASB issued an accounting standards update making certain changes to the current consolidation guidance. The amendments affect reporting entities that are required to evaluate whether they should consolidate a variable interest entity in certain situations involving entities under common control. Specifically, the amendments change the evaluation of whether a reporting entity is the primary beneficiary of a variable interest entity by changing how a reporting entity that is a single decision maker of a variable interest entity treats indirect interests in the entity held through related parties that are under common control with the reporting entity. The amendments became effective for annual periods beginning after December 15, 2016. The Company adopted this accounting standard, to be applied prospectively, effective January 1, 2017, and the adoption did not have a material impact on the Company's consolidated financial position, results of operations and cash flows.

8

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

2. Acquisition
On August 31, 2016, the Company completed its acquisition of, and acquired all the remaining equity interest in, Axiall Corporation ("Axiall"), a Delaware corporation. Prior to the acquisition, the Company held 3.1 million shares in Axiall. Pursuant to the terms of the Agreement and Plan of Merger, dated as of June 10, 2016, by and among Westlake, Axiall and Lagoon Merger Sub, Inc., a Delaware corporation that is a wholly-owned subsidiary of Westlake ("Merger Sub"), the Company acquired all of the remaining issued and outstanding shares of common stock of Axiall for $33.00 per share in cash. Pursuant to the Merger Agreement, Merger Sub was merged with and into Axiall and Axiall survived the merger as a wholly-owned subsidiary of the Company (the "Merger"). The combined company is the third-largest global chlor-alkali producer and the third-largest global polyvinyl chloride ("PVC") producer.2023, respectively. The Company's management believes that this strategic acquisition will enhance its strategy of integration and will further strengthen its roleinvestments in the North American markets.
Axiall produces a highly integrated chain of chlor-alkali and derivative products, including chlorine, caustic soda, vinyl chloride monomer ("VCM"), PVC resin, PVC compounds and chlorinated derivative products. Axiall also manufactures and sells building products, including siding, trim, mouldings, pipe and pipe fittings.
Total consideration transferred for the Merger was $2,539,360. The Merger was accounted for under the acquisition method of accounting. The assets acquired and liabilities assumed and the results of operations of the acquired business are included in the Company's Vinyls segment.
For the nine months ended September 30, 2016, the Company recognized $90,550 of transaction and integration-related costs. This included acquisition-related costs of $43,895 for advisory, consulting and professional fees and other expenses during the nine months ended September 30, 2016. Transaction and integration-related costs also included $46,655 during the nine months ended September 30, 2016 related to the settlement of Axiall share-based awards, retention agreement costs and severance benefits provided to former Axiall employees in connection with the Merger.
The following table summarizes the consideration transferred and the estimatedheld-to-maturity securities were held at amortized cost, which approximates fair value of identified assets acquired and liabilities assumed at the date of acquisition. The allocation of the consideration transferred is based on management's estimates, judgments and assumptions. When determining the fair values of assets acquired, liabilities assumed and noncontrolling interests of the acquiree, management made significant estimates, judgments and assumptions. Management estimated that consideration paid exceeded the fair value of the net assets acquired. Therefore, goodwill of $942,096 was recorded. The goodwill recognized is primarily attributable to synergies related to the Company's vinyls integration strategy that are expected to arise from the Merger. All of the goodwill is assigned to the Company's Vinyls segment. As a portion of the goodwill arising from the Merger is attributable to foreign operations, there will be a continuing foreign currency impact to goodwill in the consolidated financial statements.

9

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

  Final Purchase Consideration as of August 31, 2016
Closing stock purchase:  
Offer per share $33.00
Multiplied by number of shares outstanding at acquisition (in thousands of shares) 67,277
Fair value of Axiall shares outstanding purchased by the Company 2,220,141
Plus:  
Axiall debt repaid at acquisition 247,135
Seller's transaction costs paid by the Company (1)
 47,458
Total fair value of consideration transferred 2,514,734
   
Fair value of Axiall share-based awards attributed to pre-combination service (2)
 11,346
Additional settlement value of shares acquired 13,280
Purchase consideration 2,539,360
   
Fair value of previously held equity interest in Axiall (3)
 102,300
Total fair value allocated to net assets acquired $2,641,660
_____________
(1)Transaction costs incurred by the seller included legal and advisory costs incurred for the benefit of Axiall's former shareholders and board of directors to evaluate the Company's initial Merger proposals, explore strategic alternatives and negotiate the purchase price.
(2)The fair value of share-based awards attributable to pre-combination service includes the ratio of the pre-combination service performed to the original service period of the Axiall restricted share units and options, including related dividend equivalent rights.
(3)Prior to the Merger, the Company owned 3.1 million shares in Axiall. The investment in Axiall was carried at estimated fair value with unrealized gains recorded as a component of accumulated other comprehensive loss in the consolidated balance sheet. The Company recognized a $49,080 gain for the investment in other income, net in the consolidated statements of operations upon gaining control.

10

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

The following table summarizes the purchase price allocation:
  Net Assets Acquired as of August 31, 2016
Cash $88,251
Accounts receivable (1)
 422,274
Income tax receivable 50,980
Inventories (2)
 349,205
Prepaid expenses and other current assets 55,462
Property, plant and equipment (2)
 2,942,162
Customer relationships (weighted average lives of 9.8 years) (3)
 670,000
Other intangible assets:  
Trade name (weighted average lives of 6.8 years) 50,000
Technology (weighted average lives of 5.4 years) 41,500
Supply contracts and leases (weighted average lives of 6.3 years) 27,288
Other assets 93,875
Total assets acquired 4,790,997
Accounts and notes payable 254,041
Interest payable 8,154
Income tax payable 1,607
Accrued compensation 44,186
Accrued liabilities 154,290
Deferred income taxes (4)
 958,304
Tax reserve non-current 3,130
Pension and other post-retirement obligations 311,106
Other liabilities 101,325
Long-term debt 1,187,290
Total liabilities assumed 3,023,433
Total identifiable net assets acquired 1,767,564
Noncontrolling interest (68,000)
Goodwill 942,096
Total fair value allocated to net assets acquired $2,641,660

(1)The fair value of accounts receivable acquired was $422,274, with the gross contractual amount being $434,834. The Company expects $12,560 to be uncollectible.
(2)The Company obtained additional information related to its inventories and property, plant and equipment which led to an increase in inventories of $43,047, a decrease in property, plant and equipment of $192,579 and a corresponding increase in goodwill of $149,532 compared to the estimated fair values included in the 2016 Form 10-K.
(3)The Company obtained additional information related to its customer relationship balances which led to an increase in customer relationships of $80,000 and a corresponding decrease in goodwill compared to the estimated fair values included in the 2016 Form 10-K.
(4)Decreases in the estimated fair values of identified assets acquired led to a decrease in deferred income taxes of $26,824 compared to the estimated fair values included in the 2016 Form 10-K.

11

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

The pro forma information for the nine months ended September 30, 2016 was as follows:
  Pro Forma Nine Months Ended September 30, 2016
Net sales $5,345,365
Net income (1)
 $277,567
Net income attributable to noncontrolling interest 16,404
Net income attributable to Westlake Chemical Corporation (1)
 $261,163
Earnings per common share attributable to Westlake Chemical Corporation  
Basic $2.01
Diluted $2.00
_____________
(1)The pro forma net income amounts include Axiall's historical charges recorded during the eight-month period prior to the closing of the Merger for (1) divestitures; (2) restructuring; and (3) legal and settlement claims, net, of $26,666, $22,881 and $23,376, respectively. These amounts have not been eliminated for pro forma purposes because they do not relate to nonrecurring, transaction specific costs related to the Merger.
The pro forma amounts above have been calculated after applying the Company's accounting policies and adjusting the Axiall results to reflect (1) the increase to depreciation and amortization that would have been charged assuming the fair value adjustments to property, plant and equipment and intangible assets had been applied from January 1, 2016; (2) the elimination of net sales and cost of sales between the Company and Axiall; (3) additional pension service costs; (4) amortization of debt premium and accretion of asset retirement obligations and environmental liabilities as part of the Company's adjustments to fair value; (5) incremental interest expense that would have been incurred assuming the financing arrangements entered by the Company and repayment of a portion of Axiall's outstanding debt had occurred on January 1, 2016; (6) the elimination of transaction-related costs; and (7) an adjustment to tax-effect the aforementioned pro forma adjustments using an estimated aggregate statutory income tax rate of the jurisdictions to which the above adjustments relate. The pro forma amounts do not include any potential synergies, cost savings or other expected benefits of the Merger, are presented for illustrative purposes only and are not necessarily indicative of results that would have been achieved if the Merger had occurred as of January 1, 2016 or of future operating performance.
3. Financial Instrumentsvalue.
Restricted Cash and Cash Equivalents
The Company had restricted cash and cash equivalents of $31,682$16 and $15 at September 30, 2017, which wasMarch 31, 2024 and December 31, 2023, respectively. The Company's restricted cash and cash equivalents are primarily related to balances that are restricted for payment of distributions to certain of the Company's current and former employees. The Company had restricted cashemployees and cash equivalents of $186,216 at December 31, 2016, which wasare reflected primarily related to balances deposited with and held as security by the lender under the Company's term loan facility and for distributions to certain of the Company's current and former employees. The current portion of restricted cash and cash equivalents was $8,626 and $160,527 at September 30, 2017 and December 31, 2016, respectively. The noncurrent portion of restricted cash and cash equivalents was $23,056 and $25,689 at September 30, 2017 and December 31, 2016, respectively, and is reflected in deferred charges and other assets, net in the consolidated balance sheets.
Available-for-Sale Marketable Securities
The Company had no available-for-sale securities at September 30, 2017 or at December 31, 2016.
There were no sales or maturities of available-for-sale securities during the three and nine months ended September 30, 2017. The proceeds from sales and maturities of available-for-sale securities included in the consolidated statement of cash flows and the gross realized gains and losses included in the consolidated statement of operations for the three and nine months ended September 30, 2016 are reflected in the table below. The cost of securities sold was determined using the specific identification method.
  Three Months Ended September 30, Nine Months Ended September 30,
  2016 2016
Proceeds from sales and maturities of securities $360,506
 $662,938
Gross realized gains 52,414
 53,755
Gross realized losses (13) (35)
4.3. Accounts Receivable
Accounts receivable consist of the following:
March 31,
2024		December 31,
2023
Trade customers$1,537 $1,413 
Related parties3 7 
Allowance for credit losses(24)(27)
1,516 1,393 
Federal and state taxes59 65 
Other116 143 
Accounts receivable, net$1,691 $1,601 

9
  September 30,
2017		 December 31,
2016
Trade customers $1,111,563
 $819,739
Affiliates 7,601
 7,982
Allowance for doubtful accounts (21,961) (17,991)
  1,097,203
 809,730
Federal and state taxes 16,657
 90,414
Other 29,119
 38,599
Accounts receivable, net $1,142,979
 $938,743
5. Inventories
Inventories consist of the following:
  September 30,
2017		 December 31,
2016
Finished products $488,061
 $500,861
Feedstock, additives and chemicals 213,144
 216,877
Materials and supplies 133,630
 83,362
Inventories $834,835
 $801,100
6. Property, Plant and Equipment
As of September 30, 2017, the Company had property, plant and equipment, net totaling $6,343,637. The Company assesses these assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable, including when negative conditions such as significant current or projected operating losses exist. Other factors considered by the Company when determining if an impairment assessment is necessary include, but are not limited to, significant changes or projected changes in supply and demand fundamentals (which would have a negative impact on operating rates or margins), new technological developments, new competitors with significant raw material or other cost advantages, adverse changes associated with the U.S. and world economies and uncertainties associated with governmental actions. Long-lived assets assessed for impairment are grouped at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities.

12

Table of Contents
WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousandsmillions of dollars, except share amounts and per share data)

4. Inventories
Depreciation expense on property, plant and equipmentInventories consist of $116,160 and $75,143 is primarily included in cost of sales in the consolidated statements of operations for the three months ended September 30, 2017 and 2016, respectively. Depreciation expense on property, plant and equipment of $334,545 and $189,114 is primarily included in cost of sales in the consolidated statements of operations for the nine months ended September 30, 2017 and 2016, respectively.following:
March 31,
2024		December 31,
2023
Finished products$1,055 $989 
Feedstock, additives, chemicals and other raw materials372 401 
Materials and supplies234 232 
Inventories$1,661 $1,622 
7. Other Assets
Amortization expense on intangible and other assets included in cost of sales and selling, general and administrative expenses in the consolidated statements of operations for the three and nine months ended September 30, 2017 and 2016 were as follows:
  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017 2016
Cost of sales $10,834
 $10,061
 $33,121
 $24,452
Selling, general and administrative 26,792
 9,114
 81,323
 13,888
Total amortization expense $37,626
 $19,175
 $114,444
 $38,340
5. Goodwill
The gross carrying amounts of goodwill and the changes in the carrying amount of goodwill for the ninethree months ended September 30, 2017March 31, 2024 were as follows:
Performance and Essential Materials SegmentHousing and Infrastructure Products SegmentTotal
Balances at December 31, 2023$897 $1,144 $2,041 
Effects of changes in foreign exchange rates(2)(2)(4)
Balances at March 31, 2024$895 $1,142 $2,037 
6. Accounts Payable
  Olefins Segment Vinyls Segment Total
Balance at December 31, 2016 $29,990
 $916,563
 $946,553
Goodwill acquired during the period —
 —
 —
Measurement period adjustment —
 54,605
 54,605
Effects of changes in foreign exchange rates —
 10,184
 10,184
Balance at September 30, 2017 $29,990
 $981,352
 $1,011,342
The Company performed its annual impairment tests for the Vinyls reporting units in the second quarter of 2017 and did not identify any impairment.
8. Term Loan
On August 10, 2016, an indirect subsidiaryAccounts payable consist of the Company, Westlake International Holdings II C.V., a limited partnership organized under the lawsfollowing:
March 31,
2024		December 31,
2023
Accounts payable—third parties$871 $849 
Accounts payable to related parties12 15 
Notes payable8 13 
Accounts payable$891 $877 
10
Table of the Netherlands (the "CV Borrower"), entered into a credit agreement with Bank of America, N.A., as agent and lender, providing the CV Borrower with a $150,000 term loan facility. The term loan facility had a maturity date of March 31, 2017. The term loan was fully repaid in January 2017. The loans thereunder bore interest at a floating interest rate equal to LIBOR plus 2% per annum, payable in arrears on the last day of each three-month period following the date of funding and at maturity.

13
Contents

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousandsmillions of dollars, except share amounts and per share data)

9.7. Long-Term Debt
Long-term debt consists of the following:
March 31,
2024		December 31,
2023
0.875% senior notes due 2024$300 $300 
3.60% senior notes due 2026750 750 
Loan related to tax-exempt waste disposal revenue bonds due 202711 11 
1.625% €700 million senior notes due 2029756 773 
3.375% senior notes due 2030300 300 
3.50% senior notes due 2032250 250 
2.875% senior notes due 2041350 350 
5.00% senior notes due 2046700 700 
4.375% senior notes due 2047500 500 
3.125% senior notes due 2051600 600 
3.375% senior notes due 2061450 450 
Term loans due 202612 13 
Total long-term debt, principal amount4,979 4,997 
Less:
Unamortized discount and debt issuance costs89 91 
Long-term debt, carrying value4,890 4,906 
Less current portion:
0.875% senior notes due 2024300 299 
Long-term debt, carrying value, net of current portion$4,590 $4,607 
  September 30, 2017 December 31, 2016
  Principal
Amount		 
Unamortized
Premium,
Discount
and Debt
Issuance
Costs
 Net
Long-term
Debt		 Principal
Amount		 Unamortized
Premium,
Discount
and Debt
Issuance
Costs		 Net
Long-term
Debt
Revolving credit facility $—
 $—
 $—
 $325,000
 $—
 $325,000
4.625% senior notes due 2021 (the
   "4.625% Westlake 2021 Senior
   Notes")
 624,793
 21,881
 646,674
 624,793
 26,837
 651,630
4.625% senior notes due 2021
   (the "4.625% Subsidiary 2021 Senior
   Notes")
 63,207
 2,343
 65,550
 63,207
 2,862
 66,069
3.60% senior notes due 2022 250,000
 (1,635) 248,365
 250,000
 (1,891) 248,109
4.875% senior notes due 2023 (the
   "4.875% Westlake 2023 Senior
   Notes")
 433,793
 11,791
 445,584
 433,793
 13,431
 447,224
4.875% senior notes due 2023
   (the "4.875% Subsidiary 2023 Senior
   Notes")
 16,207
 477
 16,684
 16,207
 540
 16,747
3.60% senior notes due 2026
   (the "3.60% 2026 Senior Notes")
 750,000
 (10,031) 739,969
 750,000
 (10,757) 739,243
Loan related to tax-exempt waste
   disposal revenue bonds due 2027
 10,889
 —
 10,889
 10,889
 —
 10,889
6 ½% tax-exempt senior notes due 2029 100,000
 (861) 99,139
 100,000
 (916) 99,084
6 ¾% tax-exempt senior notes due 2032 250,000
 (605) 249,395
 250,000
 (1,883) 248,117
6 ½% tax-exempt senior notes due 2035
   (the "6 ½% 2035 GO Zone Senior
   Notes")
 89,000
 (806) 88,194
 89,000
 (839) 88,161
6 ½% tax-exempt senior notes due 2035
   (the "6 ½% 2035 IKE Zone Senior
   Notes")
 65,000
 (578) 64,422
 65,000
 (602) 64,398
5.0% senior notes due 2046 (the "5.0%
   2046 Senior Notes")
 700,000
 (25,463) 674,537
 700,000
 (26,017) 673,983
Long-term debt, net $3,352,889
 $(3,487) $3,349,402
 $3,677,889
 $765
 $3,678,654
Unamortized debt issuance costs on long-term debt were $35 and $36 at March 31, 2024 and December 31, 2023, respectively. As of March 31, 2024, the Company was in compliance with all of its long-term debt covenants.
Credit Agreement
TheOn June 9, 2022, the Company hasentered into a $1,000,000new $1,500 revolving credit facility that maturesis scheduled to mature on August 23, 2021June 9, 2027 (the "Credit Agreement"). and, in connection therewith, terminated the Company's then existing revolving credit agreement. The Credit Agreement bears interest at either (a) LIBORAdjusted Term Secured Overnight Financing Rate (as defined in the Credit Agreement) plus a spreadmargin ranging from 1.00% to 1.75%1.625% per annum or (b) Alternate Base Rate (as defined in the Credit Agreement) plus a spreadmargin ranging from 0.00% to 0.75%0.625% per annum, in each case depending on the credit rating of the Company. At September 30, 2017, the Company had no borrowings outstanding under theThe Credit Agreement.Agreement contains certain affirmative and negative covenants, including a quarterly total leverage ratio financial maintenance covenant. As of September 30, 2017, the Company had outstanding letters of credit totaling $45,414 and borrowing availability of $954,586 under the Credit Agreement. As of September 30, 2017,March 31, 2024, 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 to lend thereunder and payments of any outstanding amounts thereunder could be accelerated by the lenders. None of the Company's subsidiaries are required to guarantee the obligations of the Company under the Credit Agreement.

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, 2024, the Company had no borrowings and no letters of credit outstanding, and had borrowing availability of $1,500, under the Credit Agreement.
14
11

Table of Contents
WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousandsmillions of dollars, except share amounts and per share data)

3.60% Senior Notes due 2026 and 5.0% Senior Notes due 2046
In August 2016, the Company issued $750,000 aggregate principal amount of 3.60% senior notes due 2026 (the "3.60% 2026 Senior Notes") and $700,000 aggregate principal amount of 5.0% senior notes due 2046 (the "5.0% 2046 Senior Notes"). On March 27, 2017, the Company commenced registered exchange offers to exchange the 3.60% 2026 Senior Notes and the 5.0% 2046 Senior Notes for new notes that are identical in all material respects to the 3.60% 2026 Senior Notes and the 5.0% 2046 Senior Notes, except that the offer and issuance of the new SEC-registered notes have been registered under the Securities Act of 1933, as amended (the “Securities Act”). The exchange offers expired on April 24, 2017, and approximately 99.97% of the 3.60% 2026 Senior Notes and 100.00% of the 5.0% 2046 Senior Notes were exchanged. The 3.60% 2026 Senior Notes that were not exchanged pursuant to the exchange offers have not been registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements or a transaction not subject to the registration requirements of the Securities Act or any state securities law.
4.625% Senior Notes due 2021 and 4.875% Senior Notes due 2023
In September 2016, the Company issued $624,793 aggregate principal amount of 4.625% senior notes due 2021 (the “4.625% Westlake 2021 Senior Notes”) and $433,793 aggregate principal amount of 4.875% senior notes due 2023 (the “4.875% Westlake 2023 Senior Notes”) upon the closing of the Company's offers to exchange any and all of the $688,000 aggregate principal amount of the outstanding 4.625% senior notes due 2021 issued by Eagle Spinco Inc., a wholly-owned subsidiary of Axiall (“Eagle Spinco”), and the $450,000 aggregate principal amount of the outstanding 4.875% senior notes due 2023 issued by Axiall. In the exchange offers, $624,793 aggregate principal amount of 4.625% Westlake 2021 Senior Notes and $433,793 aggregate principal amount of 4.875% Westlake 2023 Senior Notes were issued by the Company, leaving outstanding $63,207 aggregate principal amount of the 4.625% 2021 senior notes (the "4.625% Subsidiary 2021 Senior Notes") and $16,207 aggregate principal amount of the 4.875% 2023 senior notes (the " 4.875% Subsidiary 2023 Senior Notes"). On March 27, 2017, the Company commenced registered exchange offers to exchange the 4.625% Westlake 2021 Senior Notes and the 4.875% Westlake 2023 Senior Notes for new SEC-registered notes that are identical in all material respects to the 4.625% Westlake 2021 Senior Notes and the 4.875% Westlake 2023 Senior Notes, except that the offer and issuance of the new notes have been registered under the Securities Act. The exchange offers expired on April 24, 2017, and 100.00% of both the 4.625% Westlake 2021 Senior Notes and the 4.875% Westlake 2023 Senior Notes were exchanged.
GO Zone Bonds
During September 2017, the Company directed the Louisiana Local Government Authority Environmental Facilities and Community Development Authority (the “Authority”) to optionally redeem in full $250,000 aggregate principal amount of the 2007 Series revenue bonds (the “GO Zone Bonds”) on November 1, 2017. The GO Zone Bonds were issued by the Authority in December 2007 under the Gulf Opportunity Zone Act of 2005 (GO Zone Act) for the benefit of the Company and were subject to optional redemption by the Authority upon the direction of the Company at any time on or after November 1, 2017 for 100% of the principal plus accrued interest. In connection with the redemption of the Go Zone Bonds, the Authority is required to cause the GO Zone Bonds trustee to surrender the 6 ¾% tax exempt senior notes due November 2032 to the Senior Notes trustee for cancellation. The Company used cash on hand to fund the redemption of the GO Zone Bonds.
As of September 30, 2017, the Company was in compliance with all of the covenants with respect to the Credit Agreement, 3.60% 2026 Senior Notes, 5.0% 2046 Senior Notes, 4.625% Westlake 2021 Senior Notes, 4.875% Westlake 2023 Senior Notes, 3.60% Senior Notes Due 2022, 6 ½% tax-exempt senior notes due 2029, the 6 ¾% tax-exempt senior notes due 2032, the 6 ½% 2035 GO Zone Senior Notes, the 6 ½% 2035 IKE Zone Senior Notes and the waste disposal revenue bonds.
Unamortized debt issuance costs on Long-term debt were $21,547 and $24,113 at September 30, 2017 and December 31, 2016, respectively.
10. Pension and Post-Retirement Benefits
In connection with the Merger, the Company assumed certain U.S. and non-U.S. pension plans and other post-retirement benefit plans covering Axiall employees. The Axiall pension plans are closed to new participants and provide benefits to certain employees and retirees. The other post-retirement benefit plans are unfunded and provide medical and life insurance benefits for certain employees and their dependents. See Note 2 for the fair value of pension and other post-retirement obligations assumed in the Merger.

15

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Defined Benefit Plans
Components of net periodic benefit cost (income) for the Company's pension plans are as follows:
  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017 2016
  U.S.
Plans		 Non-U.S.
Plans		 U.S.
Plans		 Non-U.S.
Plans		 U.S.
Plans		 Non-U.S.
Plans		 U.S.
Plans		 Non-U.S.
Plans
Service cost $1,336
 $528
 $315
 $318
 $4,007
 $1,509
 $315
 $777
Expected administrative
   expenses
 —
 —
 730
 —
 —
 —
 730
 —
Interest cost 6,198
 615
 2,191
 622
 18,594
 1,754
 1,553
 1,763
Expected return on plan assets (9,976) (162) (3,800) (50) (29,928) (466) (5,260) (50)
Amortization of net loss 297
 217
 338
 —
 892
 663
 978
 —
Net periodic benefit cost
   (income)
 $(2,145) $1,198
 $(226) $890
 $(6,435) $3,460
 $(1,684) $2,490
The Company made $8,108 of contributions to its U.S. pension plans and $659 of contributions to its non-U.S. pension plans during the first nine months of 2017. The Company made no contributions to its U.S. and non-U.S. pension plans during the first nine months of 2016.
The Company's funding policy for its U.S. plans is consistent with the minimum funding requirements of federal law and regulations, and, based on preliminary estimates, the Company expects to make contributions of approximately $2,569 to its U.S. pension plans and approximately $143 to its non-U.S. pension plans during the remainder of the fiscal year ending December 31, 2017.
Other Post-retirement Benefits
Components of net periodic benefit cost for the Company's other post-retirement benefits are as follows:
  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017 2016
  U.S.
Plans		 Non-U.S.
Plans		 U.S.
Plans		 Non-U.S.
Plans		 U.S.
Plans		 Non-U.S.
Plans		 U.S.
Plans		 Non-U.S.
Plans
Service cost $163
 $14
 $72
 $1
 $489
 $41
 $81
 $1
Interest cost 500
 35
 250
 3
 1,499
 100
 540
 3
Amortization of net loss 15
 —
 31
 —
 45
 —
 94
 —
Net periodic benefit cost $678
 $49
 $353
 $4
 $2,033
 $141
 $715
 $4

16

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

11. Stockholders' Equity
Changes in stockholders' equity for the nine months ended September 30, 2017 and 2016 were as follows:
  
Common
Stock
 
Common
Stock,
Held in
Treasury
 
Additional
Paid-in
Capital
 
Retained
Earnings
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Noncontrolling
Interests
 Total
Balances at December 31,
   2016
 $1,347
 $(319,339) $550,641
 $3,412,286
 $(121,306) $368,416
 $3,892,045
Net income —
 —
 —
 501,849
 —
 21,429
 523,278
Other comprehensive income
   (loss), net of income taxes:
              
Pension and other post-
   retirement benefits
   liability
 —
 —
 —
 —
 1,057
 (44) 1,013
Foreign currency
   translation adjustments
 —
 —
 —
 —
 106,563
 2,952
 109,515
Other —
 —
 —
 —
 (260) —
 (260)
Shares issued—stock-
   based compensation
 —
 4,645
 (2,441) —
 —
 —
 2,204
Stock-based compensation,
   net of tax on stock options
   exercised
 —
 —
 10,223
 —
 —
 —
 10,223
Dividends declared —
 —
 —
 (76,491) —
 —
 (76,491)
Distributions to
   noncontrolling interests
 —
 —
 —
 —
 —
 (20,767) (20,767)
Issuance of Westlake
   Chemical Partners LP
   common units
 —
 —
 —
 —
 —
 110,739
 110,739
Balances at September 30,
   2017
 $1,347
 $(314,694) $558,423
 $3,837,644
 $(13,946) $482,725
 $4,551,499

17

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

  
Common
Stock
 
Common
Stock,
Held in
Treasury
 
Additional
Paid-in
Capital
 
Retained
Earnings
 
Accumulated
Other
Comprehensive 
Income (Loss)
 
Noncontrolling
Interests
 Total
Balances at December 31,
   2015
 $1,347
 $(258,312) $542,148
 $3,109,987
 $(129,292) $296,053
 $3,561,931
Net income —
 —
 —
 299,914
 —
 14,656
 314,570
Other comprehensive income
   (loss), net of income taxes
              
Pension and other post-
   retirement benefits
   liability
 —
 —
 —
 —
 409
 —
 409
Foreign currency
   translation adjustments
 —
 —
 —
 —
 15,758
 —
 15,758
Net unrealized holding
   gains on investments
 —
 —
 —
 —
 4,999
 —
 4,999
Common stock repurchased —
 (66,725) —
 —
 —
 —
 (66,725)
Shares issued—stock-
   based compensation
 —
 5,057
 (3,407) —
 —
 —
 1,650
Stock-based compensation,
   net of tax on stock options
   exercised
 —
 —
 7,778
 —
 —
 —
 7,778
Dividends declared —
 —
 —
 (71,933) —
 —
 (71,933)
Distributions to
   noncontrolling interests
 —
 —
 —
 —
 —
 (12,300) (12,300)
Noncontrolling interest in
   acquired business
 —
 —
 —
 —
 —
 68,000
 68,000
Balances at September 30,
   2016
 $1,347
 $(319,980) $546,519
 $3,337,968
 $(108,126) $366,409
 $3,824,137
8. Accumulated Other Comprehensive Income (Loss)
Changes in accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2017 and 2016 were as follows:
  
Benefits
Liability,
Net of Tax
 
Cumulative
Foreign
Currency
Exchange,
Net of Tax
 
Net Unrealized
Holding Gains
(Losses) on
Investments,
Net of Tax
 Total
Balances at December 31, 2016 $28,945
 $(150,202) $(49) $(121,306)
Other comprehensive income (loss) before
   reclassifications
 —
 106,563
 (260) 106,303
Amounts reclassified from accumulated other
   comprehensive loss
 1,057
 —
 —
 1,057
Net other comprehensive income (loss) for the period 1,057
 106,563
 (260) 107,360
Balances at September 30, 2017 $30,002
 $(43,639) $(309) $(13,946)

18

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

  
Benefits
Liability,
Net of Tax
 
Cumulative
Foreign
Currency
Exchange,
Net of Tax
 
Net Unrealized
Holding Gains
(Losses) on
Investments,
Net of Tax
 Total
Balances at December 31, 2015 $(8,607) $(115,690) $(4,995) $(129,292)
Other comprehensive income (loss) before
   reclassifications
 (252) 15,758
 57,550
 73,056
Amounts reclassified from accumulated other
   comprehensive loss (income)
 661
 —
 (52,551) (51,890)
Net other comprehensive income for the period 409
 15,758
 4,999
 21,166
Balances at September 30, 2016 $(8,198) $(99,932) $4
 $(108,126)
The following table provides the details of the amounts reclassified from accumulated other comprehensive income (loss) into net income in the consolidated statements of operations for the three and nine months ended September 30, 2017 and 2016:
Details about Accumulated Other
   Comprehensive Income (Loss)
   Components
 
Location of Reclassification
(Income (Expense)) in
Consolidated Statements
of Operations
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Amortization of pension and
   other post-retirement items
          
Net loss (1) $(529) $(369) $(1,600) $(1,072)
  
Benefit from
   income taxes
 193
 141
 543
 411
    (336) (228) (1,057) (661)
Net unrealized gains on
   available-for-sale
   investments
          
Realized gain on available-for-sale investments Other income, net —
 52,401
 —
 53,720
  
Provision for
   income taxes
 —
 (696) —
 (1,169)
    —
 51,705
 —
 52,551
Total reclassifications for the
   period
   $(336) $51,477
 $(1,057) $51,890
_____________
(1)
These accumulated other comprehensive loss components are included in the computation of net periodic benefit cost. For additional information, please read Note 13 (Employee Benefits) to the consolidated financial statements included in the 2016 Form 10-K.
12. Stock-Based Compensation
Under the Westlake Chemical Corporation 2013 Omnibus Incentive Plan (as amended and restated, the "2013 Plan"), all employees and non-employee directors of the Company, as well as certain individuals who have agreed to become the Company's employees, are eligible for awards. Shares of common stock may be issued as authorized in the 2013 Plan. At the discretion of the administrator of the 2013 Plan, employees and non-employee directors may be granted awards in the form of stock options, stock appreciation rights, stock awards, restricted stock units or cash awards (any of which may be a performance award). Total stock-based compensation expense related to the 2013 Plan was $5,972 and $1,502 for the three months ended September 30, 2017March 31, 2024 and 2016,respectively, and $16,740 and $6,588 for the nine months ended September 30, 2017 and 2016, respectively.

19

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Under the Merger Agreement, all outstanding Axiall restricted stock units were assumed by the Company and converted into restricted stock units in respect of the Company's common stock, with the same terms and conditions except that upon settlement the award holders will receive the greater of (1) the value of $33.00 per Axiall restricted stock unit that was converted into a restricted stock unit in respect of the Company's common stock and (2) the value of the Company's common stock. The awards are classified as liability awards for financial accounting purposes and are re-measured at each reporting date until they vest.
13. Derivative Instruments
Commodity Risk Management
The Company uses derivative instruments to reduce price volatility risk on commodities, primarily ethane and natural gas. The Company does not use derivative instruments to engage in speculative activities. The Company had no derivative instruments that were designated as fair value hedges during the three and nine months ended September 30, 2017 and 2016.
The exposure on commodity derivatives used for price risk management includes the risk that the counterparty will not pay if the market declines below the established fixed price. In such case, the Company would lose the benefit of the derivative differential on the volume of the commodities covered. In any event, the Company would continue to receive the market price on the actual volume hedged. The Company also bears the risk that it could lose the benefit of market improvements over the fixed derivative price for the term and volume of the derivative instruments (as such improvements would accrue to the benefit of the counterparty). The Company had non-hedge designated feedstock forward contracts for approximately 138,600,000 gallons and 12,500,000 MMBtu as of September 30, 2017 and for approximately 257,000,000 gallons and 8,500,000 MMBtu as of December 31, 2016.

20

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Certain of the Company's derivative instruments are executed under an International Swaps and Derivatives Association ("ISDA") Master Agreement, which permits the Company and a counterparty to aggregate the amounts owed by each party under multiple transactions and replace them with a single net amount payable by one party to the other. The following tables present the Company's derivative assets and derivative liabilities reported in the consolidated balance sheets and derivative assets and derivative liabilities subject to enforceable master netting arrangements.
  September 30, 2017
  Net Presentation Gross Presentation
  Net Assets (Liabilities) Presented in the Consolidated Balance SheetsRisk management assets—Commodity forward contracts Risk management liabilities—Commodity forward contracts
Accounts receivable, net      
Derivative positions subject to enforceable master netting
   arrangements
 $793
 $2,778
 $(1,985)
Derivative positions not subject to enforceable master netting
   arrangements
 4,557
 4,557
 —
  5,350
 7,335
 (1,985)
Deferred charges and other assets, net      
Derivative positions subject to enforceable master netting
arrangements		 —
 —
 —
Derivative positions not subject to enforceable master netting
arrangements		 4,336
 4,336
 —
  4,336
 4,336
 —
Accrued liabilities      
Derivative positions subject to enforceable master netting
arrangements		 —
 —
 —
Derivative positions not subject to enforceable master netting
arrangements		 (704) —
 (704)
  (704) —
 (704)
Other liabilities      
Derivative positions subject to enforceable master netting
arrangements		 (1,410) 745
 (2,155)
Derivative positions not subject to enforceable master netting
arrangements		 (2,774) —
 (2,774)
  (4,184) 745
 (4,929)
Risk management assets (liabilities)—Commodity forward
   contracts
   $12,416
 $(7,618)

21

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

  December 31, 2016
  Net Presentation Gross Presentation
  Net Assets (Liabilities) Presented in the Consolidated Balance SheetsRisk management assets—Commodity forward contracts Risk management liabilities—Commodity forward contracts
Accounts receivable, net      
Derivative positions subject to enforceable master netting
arrangements		 $1,498
 $1,636
 $(138)
Derivative positions not subject to enforceable master netting
arrangements		 6,091
 6,091
 —
  7,589
 7,727
 (138)
Deferred charges and other assets, net      
Derivative positions subject to enforceable master netting
arrangements		 —
 —
 —
Derivative positions not subject to enforceable master netting
arrangements		 5,249
 5,249
 —
  5,249
 5,249
 —
Accrued liabilities      
Derivative positions subject to enforceable master netting
arrangements		 —
 —
 —
Derivative positions not subject to enforceable master netting
arrangements		 (1,349) —
 (1,349)
  (1,349) —
 (1,349)
Other liabilities      
Derivative positions subject to enforceable master netting
arrangements		 (436) 2,010
 (2,446)
Derivative positions not subject to enforceable master netting
arrangements		 (3,288) —
 (3,288)
  (3,724) 2,010
 (5,734)
Risk management assets (liabilities)—Commodity forward
   contracts
   $14,986
 $(7,221)
The impacts of derivative instruments that have not been designated as hedges on the Company's consolidated statements of operations2023 were as follows:
Pension and Other Post-Retirement Benefits Liability, Net of TaxCumulative Foreign Currency
Exchange, Net of Tax		Other, Net of TaxTotal
Balances at December 31, 2023$4 $(102)$— $(98)
Net other comprehensive income (loss) attributable to Westlake Corporation1 (35)— (34)
Balances at March 31, 2024$5 $(137)$— $(132)
Balances at December 31, 2022$52 $(141)$— $(89)
Net other comprehensive income (loss) attributable to Westlake Corporation— 23 (1)22 
Balances at March 31, 2023$52 $(118)$(1)$(67)
Derivatives Not Designated as
   Hedging Instruments
 
Location of Gain (Loss) Recognized
 in Income on Derivative
 Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Commodity forward contracts Cost of sales $6,846
 $(7,840) $(2,756) $7,784
See Note 14 for the fair value of the Company's derivative instruments.
14.9. 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.

22

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Level 3: Unobservable inputs that are not corroborated by market data.
The following tables summarize, by level within the fair value hierarchy, the Company's assets and liabilities that were accounted for at fair value on a recurring basis:
  September 30, 2017
  Level 1 Level 2 Total
Derivative instruments      
Risk management assets—Commodity forward contracts $233
 $12,183
 $12,416
Risk management liabilities—Commodity forward contracts (6,183) (1,435) (7,618)
       
  December 31, 2016
  Level 1 Level 2 Total
Derivative instruments      
Risk management assets—Commodity forward contracts $878
 $14,108
 $14,986
Risk management liabilities—Commodity forward contracts (6,854) (367) (7,221)
The Level 2 measurements for the Company's commodity contracts are derived using forward curves supplied by industry-recognized and unrelated third-party services.
There were no transfers in or out of Levels 1 and 2 of the fair value hierarchy for the nine months ended September 30, 2017 and 2016.
In addition to the financial assets and liabilities above, the Company has other 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 current 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 and current term loan approximate their fair valuesvalue due to the short maturities of these instruments.
The carrying and fair values of the Company's long-term debt are summarized in the table below. The fair valuemajority of the Company's long-term debt instruments is determined using aare publicly-traded. A market approach, based upon quotes from financial reporting services.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 total long-term debt are summarized below:
March 31, 2024December 31, 2023
Carrying
Value		Fair
Value		Carrying
Value		Fair
Value
Long-term debt$4,890 $4,180 $4,906 $4,236 

12
  September 30, 2017 December 31, 2016
  
Carrying
Value
 
Fair
Value
 
Carrying
Value
 
Fair
Value
Revolving credit facility $—
 $—
 $325,000
 $325,000
4.625% Westlake 2021 Senior Notes 646,674
 646,486
 651,630
 650,847
4.625% Subsidiary 2021 Senior Notes 65,550
 62,983
 66,069
 65,775
3.60% senior notes due 2022 248,365
 255,733
 248,109
 251,725
4.875% Westlake 2023 Senior Notes 445,584
 452,004
 447,224
 451,301
4.875% Subsidiary 2023 Senior Notes 16,684
 16,842
 16,747
 16,501
3.60% 2026 Senior Notes 739,969
 749,570
 739,243
 722,055
Loan related to tax-exempt waste disposal revenue bonds
   due 2027
 10,889
 10,889
 10,889
 10,889
6 ½% tax-exempt senior notes due 2029 99,139
 113,789
 99,084
 112,433
6 ¾% tax-exempt senior notes due 2032 249,395
 251,250
 248,117
 258,818
6 ½% 2035 GO Zone Senior Notes 88,194
 100,936
 88,161
 100,323
6 ½% 2035 IKE Zone Senior Notes 64,422
 73,908
 64,398
 73,270
5.0% 2046 Senior Notes 674,537
 760,739
 673,983
 691,712


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WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousandsmillions of dollars, except share amounts and per share data)

15.10. Income Taxes
The effective income tax rate was 33.1%20.6% for the third quarter of 2017.three months ended March 31, 2024 as compared to 21.1% for the three months ended March 31, 2023. The effective income tax rate for the third quarter of 2017three months ended March 31, 2024 was below the U.S. federal statutory rate of 35.0%21.0% primarily due to a higher domestic manufacturing deduction, depletion deductions, income attributable to noncontrolling interests,U.S. federal research and development credits andavailable to the foreign earnings rate differential,Company, partially offset by state incomeand foreign taxes. The effective income tax rate, which was a benefit, was (10.3)% for three months ended September 30, 2016. The effective income tax rate for the third quarter of 2016three months ended March 31, 2023 was belowabove the U.S. federal statutory rate of 35.0%21.0% primarily due to the benefit of state tax credits, the domestic manufacturing deduction, depletion deductions, income attributable to noncontrolling interests, the non-recognition of tax related to the gain recognized on previously held outstanding shares of common stock of Axiall, the benefit in prior years' and current-year tax credits for increased research and development expenditures and adjustments related to prior years' tax returns as filed and the foreign earnings rate differential,taxes partially offset by state income taxes and nondeductible transaction costs related to the Merger.
The effective income tax rate was 30.8% for the nine months ended September 30, 2017. The effective income tax rate for the nine months ended September 30, 2017 was below the U.S. federal statutory rate of 35.0% primarily due to certain discrete adjustments, a higher domestic manufacturing deduction, depletion deductions, income attributable to noncontrolling interests, research and development credits available to the Company.
On October 8, 2021, the Organization for Economic Co-operation and Development (the "OECD")/G20 Inclusive Framework on Base Erosion and Profit Shifting released a statement indicating that its members had agreed to a Two – Pillar Solution to Address the foreign earnings rate differential, partially offset by state income taxes. The effective incomeTax Challenges Arising from the Digitalisation of the Economy. Pillar One aims to reallocate a taxpayer's residual profits to the market jurisdictions with which the taxpayer has a nexus. Pillar Two aims to establish a minimum global tax rate of 15%, assessed through a top-up tax imposed on a country-by-country basis. Pillar One targets multinational companies with global annual revenue exceeding €20 billion and profit-to-revenue ratio of more than 10%. Based on the current threshold requirements, the Company does not expect to be subject to Pillar One. On December 20, 2021, the OECD released the Pillar Two model rules providing a framework for implementing a 15% minimum tax, also referred to as the Global Anti-Base Erosion ("GloBE") rules, on earnings of multinational companies with consolidated annual revenue exceeding €750 million.
On December 12, 2022, European Union (EU) member states agreed to adopt the 15% minimum tax under the Pillar Two model rules to be enacted into the member states' domestic tax laws by December 31, 2023, with an effective date beginning in 2024. As of March 31, 2024, a handful of EU member states have yet to comply. Outside of the EU, several other jurisdictions that the Company operates in have enacted legislation consistent with the GloBE rules, while other foreign countries continue to debate adoption and timing to adopt. The Company's global footprint includes operations within the EU, as well as other non-EU jurisdictions that have enacted GloBE related legislation, such as Japan, South Korea, Vietnam, the UK and Switzerland. At this time, the Company anticipates qualifying for at least one safe harbor in the majority of jurisdictions in which it operates. For those jurisdictions where a safe harbor was 29.1% fornot met, the nine months ended September 30, 2016.impact is anticipated to be immaterial. The effective income tax rate forCompany will continue to closely monitor Pillar Two developments and evaluate the 2016 period was below the U.S. federal statutory rate of 35.0% primarily duepotential impact to the benefitCompany as more foreign countries enact legislation, and as new information and guidance becomes available. The impacts of state tax credits,Pillar Two are recorded in 2024, the domestic manufacturing deduction, depletion deductions, income attributable to noncontrolling interests,first year in which the non-recognition of tax related to the gain recognized on previously held outstanding shares of common stock of Axiall, the benefit in prior years'rules take effect.
11. Earnings and current-year tax credits for increased research and development expenditures and adjustments related to prior years' tax returns as filed and the foreign earnings rate differential, partially offset by state income taxes and nondeductible transaction costs related to the Merger.Dividends per Share
The Company files income tax returns in the U.S. federal jurisdiction and in various states and foreign jurisdictions. During the second quarter of 2017, the Internal Revenue Service began an audit of the Company for the tax years 2012 to 2014.
16. 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 the periods.each period. Diluted earnings per share include the effecteffects of certain stock options.options and performance stock units.
Three Months Ended March 31,
20242023
Net income attributable to Westlake Corporation$174 $394 
Less:
Net income attributable to participating securities(1)(2)
Net income attributable to common shareholders$173 $392 
13
  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017 2016
Net income attributable to Westlake Chemical
   Corporation
 $210,832
 $65,662
 $501,849
 $299,914
Less:        
Net income attributable to participating securities (1,117) (294) (2,630) (1,347)
Net income attributable to common shareholders $209,715
 $65,368
 $499,219
 $298,567

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WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousandsmillions of dollars, except share amounts and per share data)

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 September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Three Months Ended March 31,
Three Months Ended March 31,
Three Months Ended March 31,
202420242023
Weighted average common shares—basic 129,069,186
 128,793,661
 129,033,597
 129,519,577
Plus incremental shares from:        
Assumed exercise of options 819,782
 586,295
 756,368
 584,320
Assumed exercise of options and vesting of performance stock units
Assumed exercise of options and vesting of performance stock units
Assumed exercise of options and vesting of performance stock units
Weighted average common shares—diluted 129,888,968
 129,379,956
 129,789,965
 130,103,897
        
Earnings per common share attributable to
Westlake Chemical Corporation:
        
Earnings per common share attributable to Westlake Corporation:
Earnings per common share attributable to Westlake Corporation:
Earnings per common share attributable to Westlake Corporation:
Basic
Basic
Basic $1.62
 $0.51
 $3.87
 $2.31
Diluted $1.61
 $0.51
 $3.85
 $2.29
Excluded from the computation of diluted earnings per share are options to purchase 335,276260,722 and 620,010307,411 shares of common stock for the three months ended September 30, 2017March 31, 2024 and 2016, respectively, and 291,888 and 577,254 shares of common stock for the nine months ended September 30, 2017 and 2016, respectively.2023. These options were outstanding during the periods reported but were excluded because the effect of including them would have been antidilutive.
Dividends per Share
17.Dividends declared per common share for the three months ended March 31, 2024 and 2023 were as follows:
Three Months Ended March 31,
20242023
Dividends per common share$0.5000 $0.3570 
12. Supplemental Information
Equity Method Investments
LACC, LLC Joint Venture
As of March 31, 2024, the Company owned an aggregate 50% membership interest in LACC, LLC ("LACC"). The Company accounts for its investment in LACC under the equity method of accounting and the change for the three months ended March 31, 2024 was as follows:
Investment in LACC
Balance at December 31, 2023$1,047 
Depreciation and amortization(12)
Balance at March 31, 2024$1,035 
Other Assets, Net
Other assets, net were $694 and $651 at March 31, 2024 and December 31, 2023, respectively. Deferred turnaround costs, net of accumulated amortization, included in other assets, net were $420 and $391 at March 31, 2024 and December 31, 2023, respectively.
Accrued and Other Liabilities
Accrued and other liabilities were $609,472$1,464 and $537,483$1,614 at September 30, 2017March 31, 2024 and December 31, 2016,2023, respectively. Accrued rebates, accrued litigation reserves and accrued income taxes, which are components of accrued and other liabilities, were $110,862$158, $267, and $72,187,$136, respectively, at September 30, 2017March 31, 2024 and $77,985$217, $297, and $10,891,$121, respectively, at December 31, 2016.2023. No other component of accrued and other liabilities was more than five percent of total current liabilities. Accrued liabilities with affiliatesrelated parties were $30,609$37 and $10,551$41 at September 30, 2017March 31, 2024 and December 31, 2016,2023, respectively.
Non-cash Investing Activity
The change in capital expenditure accrual increasing additions to property, plant and equipment was $8,082 for the nine months ended September 30, 2017. The change in capital expenditure accrual increasing additions to property, plant and equipment was $23,878 for the nine months ended September 30, 2016.
Other Income, Net
14
  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017 2016
Interest income $644
 $537
 $1,578
 $6,900
Dividend income 127
 574
 250
 1,499
Acquisition-related financing costs —
 (11,420) —
 (12,220)
Foreign exchange currency loss, net (3,197) (1,281) (9,483) (2,435)
Gain realized on previously held shares of Axiall
   common stock
 —
 49,080
 —
 49,080
Gains from sales of securities, net —
 3,321
 —
 4,640
Income from non-consolidated subsidiaries 3,855
 1,475
 11,066
 7,213
Other 629
 (1,021) 3,180
 (2,586)
Other income, net $2,058
 $41,265
 $6,591
 $52,091


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WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousandsmillions of dollars, except share amounts and per share data)

Non-cash Investing Activities
18.Capital expenditure related liabilities, included in accounts payable and accrued and other liabilities, were $112 and $111at March 31, 2024 and March 31, 2023, respectively.
A non-cash charge of $16 related to asset retirement obligations was recognized in the three months ended March 31, 2024.
Other Income, Net
The other income, net of $50 for the three months ended March 31, 2024 included interest income of $40 and other income, net of $22 for the three months ended March 31, 2023 included interest income of $18.
Supplemental Cash Flow Information
Three Months Ended March 31,
20242023
Cash paid for:
Interest, net of interest capitalized$52 $54 
Income taxes46 23 
Operating lease information:
Right-of-use assets obtained in exchange for operating lease obligations$44 $56 
13. 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 outcomesoutcome 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 any particular period in which costs, if any, are recognized.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.
Environmental.
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WESTLAKE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in millions of dollars, except share amounts and per share data)
Caustic Soda Antitrust. 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 Chemical Corporation d/b/a OxyChem, Shintech Incorporated 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 in the putative class for such direct purchasers seek $861 in single damages from the defendants, in addition to treble damages and attorney's fees. The plaintiffs in the putative class for such indirect purchasers seek approximately $500 in single damages from the defendants, in addition to treble damages (if permitted under applicable state law) and injunctive relief. The defendants' joint motion to dismiss the direct purchaser lawsuits was denied. The defendants' joint motion to dismiss the indirect purchaser lawsuits was granted in part and denied in part. Both groups of cases have proceeded to discovery. On October 16, 2023, the Company entered into a settlement agreement whereby the Company agreed, subject to the terms and conditions of the settlement agreement, to pay $19 to the direct purchaser plaintiffs and in which the Company admits to no violations of law and will be released from liability and dismissed from the direct purchaser lawsuits with prejudice upon receipt of final court approval of the settlement. Preliminary court approval of the settlement, which remains subject to certification of the class, has been requested and is pending. If the court grants such preliminary approval, notice of the settlement will be disseminated to the settlement class, and the settlement class members will, for a limited time period, have an opportunity to opt-out of or object to the settlement. The Company reserved $19 in connection with the litigation in 2023. Beginning in October 2020, similar class action proceedings were also filed in Canada before the Superior Court of Québec as well as before the Federal Court. These proceedings seek the certification or authorization of a class action on behalf of all residents of Canada who purchased caustic soda (including, in one of the cases, those who merely purchased products containing caustic soda) from October 1, 2015 through the present or such date deemed appropriate by the court. On December 10, 2021, the Superior Court of Québec stayed its proceedings until after a final certification decision is released in the Federal Court proceedings. 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.
Ethylene Antitrust. The Company and other ethylene consumers were named as defendants in a civil lawsuit filed by Shell Chemical Europe B.V. ("SCE") in March 2023 in the District Court of Amsterdam, the Netherlands, following the European Commission Decision AT.40410 – Ethylene from July 14, 2020. SCE is a producer of ethylene in the European market and the lawsuit alleges the defendants conspired to lower the purchase price for ethylene and ethylene derivatives by manipulating the monthly contract price. SCE initially sought declaratory relief. In October 2023, SCE amended its claim and is now seeking a judgment establishing that the Company and the co-defendants are jointly and severally liable for alleged damages in the amount of approximately €1,026 million with interest compounding daily from January 1, 2020 and continuing until payment in full, as provided by Dutch law, resulting from artificially lowered prices for ethylene and ethylene derivatives during the specified period. SCE is also seeking reimbursement of costs related to the proceeding plus statutory interest. The Company and other ethylene consumers were also named as defendants in a civil lawsuit filed by Stichting Ethylene Claims ("Stichting") in November 2023 in the District Court of Amsterdam, the Netherlands, following the same European Commission decision. Stichting is a foundation under Dutch Law that claims to represent various parties asserting injury by the same alleged conduct of defendants, seeking a declaratory judgment establishing that the Company and other defendants are jointly and severally liable for an unspecified amount of damages. At this time, the Company is not able to estimate the impact, if any, that the SCE lawsuit and/or the Stichting lawsuit could have on the Company's consolidated financial statements either in the current period or in future periods.
Triad Hunter. In April 2018, Triad Hunter, LLC ("Triad Hunter") filed suit against the Company and certain of its subsidiaries in the Court of Common Pleas in Monroe County, Ohio seeking injunctive relief and alleging negligence and trespass at the Natrium Plant with respect to Triad Hunter's well drilling activities in Ohio. On October 27, 2022, the jury returned a verdict finding that the Company had committed trespass and was negligent in conducting salt mining operations at the Natrium Plant. Upon receipt of the jury verdict, the Company reserved approximately $70 for the damages awarded to Triad Hunter. The court subsequently denied Triad Hunter's request to enjoin further solution mining from one of the brine fields at the Natrium Plant. On September 12, 2023, final judgment was entered in the amount of $70 with interest accruing at the rate of 5% from the date the judgment was rendered, as provided by law. The Company appealed the verdict and sought a stay of execution pending appeal on October 30, 2023.
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WESTLAKE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in millions of dollars, except share amounts and per share data)
Petro 2 Flash Fire and EDC Storage Tank Explosion. In September 2021, shortly after the turnaround on Westlake Chemical OpCo LP's Petro 2 ethylene facility commenced, there was a flash fire at the quench tower of the Petro 2 facility. In January 2022, an ethylene dichloride storage tank exploded at one of the Company's Lake Charles, Louisiana complexes. Certain employees and contractors working on the sites at the time of the events were injured during these events and multiple lawsuits were filed against us. Final settlements totaling approximately $382 in the aggregate were reached with all of the plaintiffs to fully resolve the lawsuits, but payment by the Company and the insurance carriers has not yet been completed. Certain of the Company's excess insurers have taken the coverage position that there has been insufficient exhaustion of the retention levels beneath their respective attachment points to obligate them to cover these events. The practical effect of this coverage position is that approximately $150 of the $382 total final settlement amount is not being covered by the insurers and, as such, approximately $150 was included in cost of sales in the fourth quarter of 2023. After discussion with the insurers, the Company has decided not to pursue recovery of the approximately $150 from the insurers. The Company reserved for the full final settlement amount in 2023 and, as of March 31, 2024, has an insurance receivable of $13 and a legal accrual of $151 in the Company's consolidated financial statements.
Environmental Contingencies. As of September 30, 2017March 31, 2024 and December 31, 2016,2023, the Company had reserves for environmental contingencies totaling approximately $47,409$57 and $48,817,$58, 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.
From time to time the Company receives notices or inquiries from government entities regarding alleged violations of environmental laws and regulations pertaining to, among other things, the disposal, emission and storage of chemical substances, including hazardous wastes. Item 103 of the SEC's Regulation S-K requires disclosure of certain environmental matters when a governmental authority is a party to the proceedings and the proceedings involve potential monetary sanctions, unless the Company reasonably believes such sanctions would not exceed $100.
In May 2013, an amendment to an existing consent order agreed to by the West Virginia Department of Environmental Protection and a predecessor of Axiall required that it, among other things, pay a penalty in the amount of $449 and continue certain corrective action associated with discharges of hexachlorocyclohexane (commonly referred to as BHC) from the Natrium, West Virginia facility's effluent discharge outfalls. The penalty was paid and corrective actions required are on-going per a December 2016 agreement to extend the compliance date under the amended consent order.
In May 2013 and September 2013,Calvert City Proceedings. For several years, the Environmental Protection Agency (the "EPA") conducted inspectionshas been conducting remedial investigation and feasibility studies at the Company's Plaquemine, LouisianaCalvert City, Kentucky facility pursuant to requirementsthe Comprehensive Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA"). As the current owner of the federal Clean Air Act Section 112(r) Risk Management ProgramCalvert City facility, the Company was named by the EPA as a potentially responsible party ("PRP") along with Goodrich Corporation ("Goodrich") and Title V. Asits successor-in-interest, Avient Corporation (formerly known as PolyOne Corporation, "Avient"). On November 30, 2017, the EPA published a resultdraft Proposed Plan, incorporating by reference an August 2015 draft Remedial Investigation ("RI") report, an October 2017 draft Feasibility Study ("FS") report and a 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 inspections,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 identified areaspublished the Record of concernDecision ("ROD") for the site, formally selecting the preferred final and interim remedies outlined in the amended Proposed Plan. In October 2018, the 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, subsequently engagedjointly with the other PRPs, submitted a good faith offer response in negotiationsDecember 2019. On September 17, 2020, the EPA and the Department of Justice filed a proposed consent decree for the remedial action with the U.S. District Court for the Western District of Kentucky. On November 16, 2020, the Department of Justice filed a motion to resolve alleged violations. A Consent Agreementapprove and Final Order (“CAFO”) was filed in October 2016, pursuantenter the consent decree. On January 28, 2021, the Court granted the unopposed motion to enter the consent decree, which became effective the same day. 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, paid civil penalties inGoodrich and Avient. These agreements and the amount of $167.
The LDEQ has issued notices of violations ("NOVs") regarding the Company's olefins facilities in Lake Charles, Louisiana for various air and water compliance issues. The Company has reached an agreement with the LDEQ to settle certain of the NOVs along with other alleged violations not made the subject of any specific NOV in two separate settlement agreements, pursuant to which the Company paid $192 in civil penalties.
During September 2010, the Company's vinyls facilities in north Lake Charles and Plaquemine each received a Consolidated Compliance Order and Notice of Potential Penalty, alleging violations of various requirements of those facilities' air permits, based largely on self-reported permit deviations related to record-keeping violations. The Company has been negotiating a possible global settlement of these and several other matters with the LDEQ. The Company believes the resolution of these matters may require the payment of a monetary sanction in excess of $100.
In April 2015, Axiall received a communication from the EPA related to, among other things, the EPA's investigation of the 2012 and 2013 fires that occurred at its VCM plant in Lake Charles. In late 2015, Axiall settled this matter with the EPA, with such settlement including on-going supplemental environmental projects and a penalty payment of $878.

associated litigation are described below.
26
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WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousandsmillions of dollars, except share amounts and per share data)

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 several years,its part, the EPA hasCompany 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 conducting an enforcement initiative against petroleum refineriesextensively contaminated by Goodrich's operations. In 1993, Goodrich spun off the predecessor of Avient, and petrochemical plantsthat predecessor assumed Goodrich's indemnification obligations relating to preexisting contamination. In 2003, litigation arose among the Company, Goodrich and Avient with respect to emissionsthe 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) Avient would pay 100% of the costs (with specified exceptions), net of recoveries or credits from flares. On April 21, 2014, the Company received a Clean Air Act Section 114 Information Request from the EPA which sought information regarding flaresthird parties, incurred with respect to environmental issues at the Calvert City site from August 1, 2007 forward; and (2) either the Company or Avient 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, Avient filed a demand for arbitration. In this proceeding, Avient 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 Avient paid such costs in full at the beginning of the arbitration hearing.
On July 10, 2018, Avient sued the Company in the U.S. District Court for the Western District of Kentucky and certain Lake Charles facilities.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 Avient's suit. On February 13, 2019, Avient appealed those decisions to the U.S. Court of Appeals for the Sixth Circuit. The EPA has informedcourt 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 Avient was responsible for 100% of the allocable costs at issue in the proceeding and that Avient would remain responsible for 100% of the costs to operate the existing groundwater remedy at the Calvert City site. In August 2019, Avient 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 Avient's motion to vacate and affirmed the arbitration final award. Avient 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.
In March 2022, the Company filed a demand for arbitration seeking reimbursement for certain allocable costs incurred during the applicable period since May 2017, and which Avient has failed to pay or disputed as not subject to indemnity under the 1990 and 1997 agreements. In April 2022, Avient filed a complaint in the federal district court for the Western District of Kentucky disputing the enforceability of the 2007 settlement agreement and seeking to enjoin arbitration. Avient claims that the information provided leadsallocable costs at issue are up to $22, for which Avient claims the EPACompany is totally liable. On September 30, 2023, the court issued an order denying without prejudice the parties' cross motions for summary judgment and set a 30-day deadline for the parties to believe that somerefile and provide additional briefing on specific aspects of the flaresarguments before the court. The parties each refiled and provided additional briefing by the deadline and the motions are out of compliance with applicable standards.pending before the court. The EPA has indicated thatCompany disputes these claims and at this time, the Company believes it is seeking a consent decreeunlikely that any remediation costs allocable to it would obligateresult in material expenditures in any individual reporting period.
18
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WESTLAKE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in millions of dollars, except share amounts and per share data)
Sulphur Brine Dome. The Company owns and operates salt solution-mining caverns at the Sulphur Brine Dome in Sulphur, Louisiana. The Louisiana Department of Natural Resources issued Compliance Order No. IMD 2022-027 and several supplements to that order, the latest in October 2023, in response to pressure anomaly events in two of the Company's brine caverns. The brine caverns were not active, operating wells but under ongoing, post-operational monitoring requirements. The compliance order and supplements thereto have required the Company to take corrective actions relatingundertake various activities related to response planning, monitoring, investigation and mitigation of potential impacts in the event of future cavern pressure anomalies or failures. Since December 2022 continuous brine injection has maintained cavern pressure while the Company continues to pursue active monitoring, studies, groundwater monitoring, modeling and other activities under the compliance order and supplements. In September 2023, the Office of Conservation issued an emergency declaration as a conservative step and to ensure that the full suite of powers and resources are available to the alleged noncompliance.government in its response and management of the evolving circumstances at the Sulphur Dome. The capital costs and expenditures required to comply with the compliance order and supplements have been and will continue to be incurred. In response to the most recent supplement to the compliance order, the Company believesreserved approximately $14 in connection with groundwater monitoring wells and monitoring required by the resolution of these matters may requiresupplement. At this time, the payment of a monetary sanction in excess of $100.
The Company does not believeis unable to estimate the impact, if any, that resolutions of anyother ongoing expenditures or all of these matters willfuture injunctive relief ordered by the government could have a material adverse effect on the Company's consolidated financial condition, results of operationsstatements either in the current period or cash flows.in future periods.
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 $40,000$125 to $80,000.$200.
Commitments. In connection with the Merger, the Company became a party to a joint venture investment with Lotte Chemical USA Corporation to build an ethylene facility, LACC, LLC ("LACC"). The ethylene facility is located adjacent to the Company's vinyls facility

19
Table of Contents
WESTLAKE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in Lake Charles. Pursuant to the contributionmillions of dollars, except share amounts and subscription agreement, the Company agreed to make a maximum capital commitment to LACC of up to $225,000 to fund the construction costs of the ethylene plant, which represents approximately 10.0% of the interests in LACC. The construction of the ethylene plant commenced in January 2016, with an anticipated start-up in 2019. As of September 30, 2017, the Company had funded approximately $106,405 of the Company's portion of the construction costs of the ethylene plant.per share data)
19.14. Segment Information
The Company operates in two principal operating segments: OlefinsPerformance and Vinyls.Essential Materials and Housing and Infrastructure Products. These segments are strategic business units that offer a variety of different materials and products. The Company manages each segment separately as each business requires different technology and marketing strategies.
Three Months Ended March 31,
20242023
Net external sales
Performance and Essential Materials
Performance Materials$1,164 $1,282 
Essential Materials767 1,067 
Total Performance and Essential Materials1,931 2,349 
Housing and Infrastructure Products
Housing Products879 818 
Infrastructure Products165 189 
Total Housing and Infrastructure Products1,044 1,007 
$2,975 $3,356 
Intersegment sales
Performance and Essential Materials$111 $111 
Housing and Infrastructure Products— — 
$111 $111 
Income (loss) from operations
Performance and Essential Materials$22 $403 
Housing and Infrastructure Products210 143 
Corporate and other(9)(10)
$223 $536 
Depreciation and amortization
Performance and Essential Materials$220 $210 
Housing and Infrastructure Products50 55 
Corporate and other3 2 
$273 $267 
Other income, net
Performance and Essential Materials$11 $2 
Housing and Infrastructure Products4 7 
Corporate and other35 13 
$50 $22 
Provision for (benefit from) income taxes
Performance and Essential Materials$(11)$67 
Housing and Infrastructure Products56 37 
Corporate and other3 5 
$48 $109 
20
  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017 2016
Net external sales        
Olefins        
Polyethylene $377,269
 $380,810
 $1,121,603
 $1,098,500
Styrene, feedstock and other 124,974
 116,555
 412,869
 324,369
Total Olefins 502,243
 497,365
 1,534,472
 1,422,869
Vinyls        
PVC, caustic soda and other 1,252,963
 599,276
 3,541,409
 1,492,650
Building products 353,683
 182,387
 954,785
 424,757
Total Vinyls 1,606,646
 781,663
 4,496,194
 1,917,407
  $2,108,889
 $1,279,028
 $6,030,666
 $3,340,276
         
Intersegment sales        
Olefins $106,722
 $30,614
 $290,658
 $85,856
Vinyls 260
 2,130
 871
 2,719
  $106,982
 $32,744
 $291,529
 $88,575
         

27

Table of Contents
WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousandsmillions of dollars, except share amounts and per share data)

  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017 2016
Income (loss) from operations        
Olefins $165,438
 $118,475
 $488,532
 $408,274
Vinyls 216,515
 22,235
 431,276
 136,559
Corporate and other (16,206) (94,147) (51,647) (116,056)
  $365,747
 $46,563
 $868,161
 $428,777
         
Depreciation and amortization        
Olefins $35,029
 $36,649
 $111,244
 $95,582
Vinyls 117,490
 56,136
 331,585
 128,691
Corporate and other 1,115
 1,444
 5,704
 2,920
  $153,634
 $94,229
 $448,533
 $227,193
         
Other income (expense), net        
Olefins $(184) $1,101
 $1,555
 $3,706
Vinyls (970) (1,226) 1,087
 1,722
Corporate and other 3,212
 41,390
 3,949
 46,663
  $2,058
 $41,265
 $6,591
 $52,091
         
Provision for (benefit from) income taxes        
Olefins $58,218
 $31,956
 $152,482
 $136,429
Vinyls 60,784
 (3,912) 114,979
 29,655
Corporate and other (10,383) (34,596) (34,771) (36,752)
  $108,619
 $(6,552) $232,690
 $129,332
         
Capital expenditures        
Olefins $20,960
 $96,469
 $70,043
 $285,359
Vinyls 107,515
 83,523
 329,968
 180,392
Corporate and other 4,894
 178
 14,260
 1,579
  $133,369
 $180,170
 $414,271
 $467,330
Three Months Ended March 31,
20242023
Capital expenditures
Performance and Essential Materials$230 $226 
Housing and Infrastructure Products37 38 
Corporate and other5 3 
$272 $267 
A reconciliation of total segment income from operations to consolidated income before income taxes is as follows:
Three Months Ended March 31,
20242023
Income from operations$223 $536 
Interest expense(40)(42)
Other income, net50 22 
Income before income taxes$233 $516 

March 31,
2024		December 31,
2023
Total assets
Performance and Essential Materials$13,430 $13,538 
Housing and Infrastructure Products5,078 4,888 
Corporate and other2,452 2,609 
$20,960 $21,035 
  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017 2016
Income from operations $365,747
 $46,563
 $868,161
 $428,777
Interest expense (40,036) (24,366) (118,784) (36,966)
Other income (expense), net 2,058
 41,265
 6,591
 52,091
Income before income taxes $327,769
 $63,462
 $755,968
 $443,902


28

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

  September 30,
2017		 December 31,
2016
Total assets    
Olefins $2,015,888
 $2,092,617
Vinyls 8,695,509
 8,287,204
Corporate and other 532,728
 510,432
  $11,244,125
 $10,890,253
20.15. Westlake Chemical Partners LP Offerings
In March 2014, wethe Company formed Westlake Chemical Partners LP ("WLKP"Westlake Partners") to operate, acquire and develop ethylene production facilities and related assets. On August 4,Also in 2014, WLKPWestlake Partners completed its initial public offering (the "IPO") of 12,937,500 common units atunits.
As of March 31, 2024, Westlake Partners had a price of $24.00 per unit. Net proceeds to WLKP from the sale of the units was approximately $286,100, net of underwriting discounts, structuring fees and estimated offering expenses of approximately $24,400. At the consummation of the IPO, WLKP's assets consisted of a 10.6%22.8% limited partner interest in Westlake Chemical OpCo LP ("OpCo"), as well as the general partner interest in OpCo. Immediately after the IPO,and the Company retained an 89.4%a 77.2% limited partner interest in OpCo and a significant interest in WLKP. The initial public offering representedWestlake Partners through the saleCompany's ownership of 47.8%Westlake Partners' general partner, 40.1% of the limited partner interests (consisting of 14,122,230 common units) and incentive distribution rights.
On October 4, 2018, Westlake Partners and Westlake Chemical Partners GP LLC, the general partner of Westlake Partners, 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 Westlake Partners' common units, in WLKP.
On April 29, 2015, WLKP purchasedfrom time to time, up to an additional 2.7% newly-issued limited partner interest in OpCo. On September 29, 2017, WLKP purchased an additional 5.0% newly-issued limited partner interest in OpCo.
On September 29, 2017, WLKP completedaggregate offering amount of $50. This Equity Distribution Agreement was amended on February 28, 2020 to reference a secondary offering of 5,175,000new shelf registration and subsequent renewals thereof for utilization under this agreement. No common units at a price of $22.00 per unit. Net proceeds to WLKP from the sale of the units was $110,739, net of underwriting discounts, structuring fees and estimated offering expenses of approximately $3,111. At September 30, 2017, WLKP had a 18.3% limited partner interest in OpCo, and the Company retained a 81.7% limited partner interest in OpCo and a significant interest in WLKP.
21. Subsequent Events
Subsequent events were evaluated through the date on which the consolidated financial statements were issued.
22. Guarantor Disclosures
The Company's payment obligationsissued under the 3.60% senior notes due 2022, the 3.60% 2026 Senior Notes, the 5.0% 2046 Senior Notes, 4.625% Westlake 2021 Senior Notes and the 4.875% Westlake 2023 Senior Notes are fully and unconditionally guaranteed by each of its current and future domestic subsidiaries that guarantee other debt of the Company or of another guarantor of those notes in excess of $5,000 (the "Guarantor Subsidiaries"). Each Guarantor Subsidiary is 100% owned by Westlake Chemical Corporation (the "100% Owned Guarantor Subsidiaries"). In October 2016, the Company executed a Joinder Agreement with the Administrative Agent of the Credit Agreement, whereby certain subsidiaries of the Company were added as Guarantor Subsidiaries. These guarantees are the joint and several obligations of the Guarantor Subsidiaries. The following unaudited condensed consolidating financial information presents the financial condition, results of operations and cash flows of Westlake Chemical Corporation, the 100% owned Guarantor Subsidiaries, and the remaining subsidiaries that do not guarantee the 3.60% senior notes due 2022 , the 3.60% 2026 Senior Notes, the 5.0% 2046 Senior Notes, 4.625% Westlake 2021 Senior Notes and the 4.875% Westlake 2023 Senior Notes (the "Non-Guarantor Subsidiaries"), together with consolidating eliminations necessary to present the Company's results on a consolidated basis.
In August 2016, certain of the Company's subsidiary guarantors were released from their guarantees of the Company's 3.60% senior notes due 2022 in connection with the replacement of the Company's revolving credit facility. Westlake Chemical OpCo LP, which was previously separately presented as a less than 100% owned guarantor, and certain of the Company's other 100% owned subsidiaries that were previously presented as guarantors, are now reflected as Non-Guarantor Subsidiaries in the condensed consolidating guarantor financial information. Prior periods were retrospectively adjusted to conform to the current presentation of Guarantor Subsidiaries and Non-Guarantor Subsidiaries.

29

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Condensed Consolidating Financial Informationthis program as of September 30, 2017March 31, 2024.
21
  
Westlake
Chemical
Corporation
 
100% Owned
Guarantor
Subsidiaries
 
Non-
Guarantor
Subsidiaries
 Eliminations Consolidated
Balance Sheet          
Current assets          
Cash and cash equivalents $334,111
 $33,089
 $311,033
 $—
 $678,233
Accounts receivable, net 3,060,591
 4,048,824
 432,238
 (6,398,674) 1,142,979
Inventories —
 631,322
 203,513
 —
 834,835
Prepaid expenses and other current assets 16,616
 31,785
 22,365
 (35,906) 34,860
Restricted cash —
 1,275
 7,351
 —
 8,626
Total current assets 3,411,318
 4,746,295
 976,500
 (6,434,580) 2,699,533
Property, plant and equipment, net —
 4,330,104
 2,013,533
 —
 6,343,637
Other assets, net          
Goodwill —
 854,896
 156,446
 —
 1,011,342
Customer relationships, net —
 493,960
 141,924
 —
 635,884
Other intangible assets, net —
 92,155
 74,011
 —
 166,166
Deferred charges and other assets, net 9,890,164
 551,732
 1,372,070
 (11,426,403) 387,563
Total other assets, net 9,890,164
 1,992,743
 1,744,451
 (11,426,403) 2,200,955
Total assets $13,301,482
 $11,069,142
 $4,734,484
 $(17,860,983) $11,244,125
Current liabilities          
Accounts payable $5,821,323
 $830,824
 $128,673
 $(6,220,016) $560,804
Accrued liabilities 155,106
 436,816
 232,114
 (214,564) 609,472
Total current liabilities 5,976,429
 1,267,640
 360,787
 (6,434,580) 1,170,276
Long-term debt, net 3,256,280
 4,334,142
 223,578
 (4,464,598) 3,349,402
Deferred income taxes —
 1,577,209
 106,587
 (22,882) 1,660,914
Pension and other liabilities —
 364,011
 148,023
 —
 512,034
Total liabilities 9,232,709
 7,543,002
 838,975
 (10,922,060) 6,692,626
Total Westlake Chemical Corporation
   stockholders' equity
 4,068,773
 3,526,140
 3,412,784
 (6,938,923) 4,068,774
Noncontrolling interests —
 —
 482,725
 —
 482,725
Total equity 4,068,773
 3,526,140
 3,895,509
 (6,938,923) 4,551,499
Total liabilities and equity $13,301,482
 $11,069,142
 $4,734,484
 $(17,860,983) $11,244,125

30

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Condensed Consolidating Financial Information as of December 31, 2016
  
Westlake
Chemical
Corporation
 
100% Owned
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 Eliminations Consolidated
Balance Sheet          
Current assets          
Cash and cash equivalents $146,990
 $53,006
 $259,457
 $—
 $459,453
Accounts receivable, net 2,117,540
 3,329,871
 323,931
 (4,832,599) 938,743
Inventories —
 597,819
 203,281
 —
 801,100
Prepaid expenses and other current assets 30,748
 41,755
 12,494
 (36,504) 48,493
Restricted cash —
 —
 160,527
 —
 160,527
Total current assets 2,295,278
 4,022,451
 959,690
 (4,869,103) 2,408,316
Property, plant and equipment, net —
 4,475,943
 1,944,119
 —
 6,420,062
Other assets, net          
Goodwill —
 791,706
 154,847
 —
 946,553
Customer relationships, net —
 468,645
 142,970
 —
 611,615
Other intangible assets, net —
 130,243
 71,177
 (25,581) 175,839
Deferred charges and other assets, net 9,170,042
 874,003
 1,115,877
 (10,832,054) 327,868
Total other assets, net 9,170,042
 2,264,597
 1,484,871
 (10,857,635) 2,061,875
Total assets $11,465,320
 $10,762,991
 $4,388,680
 $(15,726,738) $10,890,253
Current liabilities          
Accounts payable $4,330,375
 $748,364
 $225,300
 $(4,807,780) $496,259
Accrued liabilities 26,367
 389,216
 183,223
 (61,323) 537,483
Term loan —
 —
 149,341
 —
 149,341
Total current liabilities 4,356,742
 1,137,580
 557,864
 (4,869,103) 1,183,083
Long-term debt, net 3,584,949
 4,090,775
 —
 (3,997,070) 3,678,654
Deferred income taxes —
 1,581,260
 91,809
 (22,494) 1,650,575
Pension and other liabilities —
 360,622
 125,274
 —
 485,896
Total liabilities 7,941,691
 7,170,237
 774,947
 (8,888,667) 6,998,208
Total Westlake Chemical Corporation
   stockholders' equity
 3,523,629
 3,592,754
 3,245,317
 (6,838,071) 3,523,629
Noncontrolling interests —
 —
 368,416
 —
 368,416
Total equity 3,523,629
 3,592,754
 3,613,733
 (6,838,071) 3,892,045
Total liabilities and equity $11,465,320
 $10,762,991
 $4,388,680
 $(15,726,738) $10,890,253

31

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Condensed Consolidating Financial Information for the Three Months Ended September 30, 2017
  
Westlake
Chemical
Corporation
 
100% Owned
Guarantor
Subsidiaries
 
Non-
Guarantor
Subsidiaries
 Eliminations Consolidated
Statement of Operations          
Net sales $—
 $1,704,086
 $837,536
 $(432,733) $2,108,889
Cost of sales —
 1,371,813
 665,124
 (426,100) 1,610,837
Gross profit —
 332,273
 172,412
 (6,633) 498,052
Selling, general and administrative expenses 1,509
 93,149
 37,617
 (6,633) 125,642
Transaction and integration-related costs —
 6,387
 276
 —
 6,663
Income (loss) from operations (1,509) 232,737
 134,519
 —
 365,747
Other income (expense)          
Interest expense (38,811) (44,381) (1,635) 44,791
 (40,036)
Other income, net 37,563
 2,517
 6,769
 (44,791) 2,058
Income (loss) before income taxes (2,757) 190,873
 139,653
 —
 327,769
Provision for (benefit from) income taxes (599) 92,597
 16,621
 —
 108,619
Equity in net income of subsidiaries 212,989
 —
 —
 (212,989) —
Net income 210,831
 98,276
 123,032
 (212,989) 219,150
Net income attributable to noncontrolling
   interests
 —
 —
 8,318
 —
 8,318
Net income attributable to Westlake Chemical
   Corporation
 $210,831
 $98,276
 $114,714
 $(212,989) $210,832
Comprehensive income attributable to
   Westlake Chemical Corporation
 $254,400
 $98,455
 $158,160
 $(256,615) $254,400


32

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Condensed Consolidating Financial Information for the Three Months Ended September 30, 2016
  
Westlake
Chemical
Corporation
 
100% Owned
Guarantor
Subsidiaries
 
Non-
Guarantor
Subsidiaries
 Eliminations Consolidated
Statement of Operations          
Net sales $—
 $984,937
 $611,983
 $(317,892) $1,279,028
Cost of sales —
 892,198
 497,460
 (312,763) 1,076,895
Gross profit —
 92,739
 114,523
 (5,129) 202,133
Selling, general and administrative expenses 2,092
 47,952
 27,814
 (5,129) 72,729
Transactions and integration-related costs —
 82,687
 154
 —
 82,841
Income (loss) from operations (2,092) (37,900) 86,555
 —
 46,563
Other income (expense)          
Interest expense (22,130) (22,207) (908) 20,879
 (24,366)
Other income (expense), net 35,405
 (15,189) 41,928
 (20,879) 41,265
Income (loss) before income taxes 11,183
 (75,296) 127,575
 —
 63,462
Provision for (benefit from) income taxes (2,088) (11,080) 6,616
 —
 (6,552)
Equity in net income of subsidiaries 52,391
 —
 —
 (52,391) —
Net income 65,662
 (64,216) 120,959
 (52,391) 70,014
Net income attributable to noncontrolling
   interests
 —
 —
 4,352
 —
 4,352
Net income attributable to Westlake Chemical
   Corporation
 $65,662
 $(64,216) $116,607
 $(52,391) $65,662
Comprehensive income attributable to
   Westlake Chemical Corporation
 $39,636
 $(64,113) $104,129
 $(40,015) $39,637

33

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Condensed Consolidating Financial Information for the Nine Months Ended September 30, 2017
  
Westlake
Chemical
Corporation
 
100% Owned
Guarantor
Subsidiaries
 
Non-
Guarantor
Subsidiaries
 Eliminations Consolidated
Statement of Operations          
Net sales $—
 $4,880,682
 $2,377,862
 $(1,227,878) $6,030,666
Cost of sales —
 4,077,633
 1,889,571
 (1,207,567) 4,759,637
Gross profit —
 803,049
 488,291
 (20,311) 1,271,029
Selling, general and administrative expenses 2,429
 281,412
 116,389
 (20,311) 379,919
Transaction and integration-related costs —
 22,611
 338
 —
 22,949
Income (loss) from operations (2,429) 499,026
 371,564
 —
 868,161
Other income (expense)          
Interest expense (115,156) (133,048) (5,623) 135,043
 (118,784)
Other income, net 112,002
 2,944
 26,688
 (135,043) 6,591
Income (loss) before income taxes (5,583) 368,922
 392,629
 —
 755,968
Provision for (benefit from) income taxes (1,451) 198,054
 36,087
 —
 232,690
Equity in net income of subsidiaries 505,981
 —
 —
 (505,981) —
Net income 501,849
 170,868
 356,542
 (505,981) 523,278
Net income attributable to noncontrolling
   interests
 —
 —
 21,429
 —
 21,429
Net income attributable to Westlake Chemical
   Corporation
 $501,849
 $170,868
 $335,113
 $(505,981) $501,849
Comprehensive income attributable to
   Westlake Chemical Corporation
 $613,350
 $171,413
 $233,030
 $(404,443) $613,350

34

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Condensed Consolidating Financial Information for the Nine Months Ended September 30, 2016
  
Westlake
Chemical
Corporation
 
100% Owned
Guarantor
Subsidiaries
 
Non-
Guarantor
Subsidiaries
 Eliminations Consolidated
Statement of Operations          
Net sales $—
 $2,567,232
 $1,734,611
 $(961,567) $3,340,276
Cost of sales —
 2,233,395
 1,353,764
 (945,967) 2,641,192
Gross profit —
 333,837
 380,847
 (15,600) 699,084
Selling, general and administrative expenses 3,648
 121,261
 70,448
 (15,600) 179,757
Transaction and integration-related costs —
 90,396
 154
 —
 90,550
Income (loss) from operations (3,648) 122,180
 310,245
 —
 428,777
Other income (expense)          
Interest expense (43,228) (39,693) (1,054) 47,009
 (36,966)
Other income (expense), net 40,807
 (22,291) 80,584
 (47,009) 52,091
Income (loss) before income taxes (6,069) 60,196
 389,775
 —
 443,902
Provision for (benefit from) income taxes (8,268) 106,792
 30,808
 —
 129,332
Equity in net income of subsidiaries 297,715
 —
 —
 (297,715) —
Net income 299,914
 (46,596) 358,967
 (297,715) 314,570
Net income attributable to noncontrolling
   interests
 —
 —
 14,656
 —
 14,656
Net income attributable to Westlake Chemical
   Corporation
 $299,914
 $(46,596) $344,311
 $(297,715) $299,914
Comprehensive income attributable to
   Westlake Chemical Corporation
 $321,079
 $(46,187) $364,402
 $(318,214) $321,080


35

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Condensed Consolidating Financial Information for the Nine Months Ended September 30, 2017
  
Westlake
Chemical
Corporation
 
100% Owned
Guarantor
Subsidiaries
 
Non-
Guarantor
Subsidiaries
 Eliminations Consolidated
Statement of Cash Flows          
Cash flows from operating activities          
Net income $501,849
 $170,868
 $356,542
 $(505,981) $523,278
Adjustments to reconcile net income to net
   cash provided by (used for) operating
   activities
          
Depreciation and amortization —
 294,227
 154,306
 —
 448,533
Deferred income taxes (217) 20,299
 3,212
 —
 23,294
Net changes in working capital and other (532,120) (129,330) 123,028
 505,981
 (32,441)
Net cash provided by (used for)
   operating activities
 (30,488) 356,064
 637,088
 —
 962,664
Cash flows from investing activities          
Additions to property, plant and equipment —
 (294,138) (120,133) —
 (414,271)
Additions to cost method investment —
 (47,000) —
 —
 (47,000)
Proceeds from disposition of assets —
 25
 146
 —
 171
Proceeds from involuntary conversion of
   assets
 —
 —
 1,672
 —
 1,672
Receivable under the investment management
   agreement
 —
 —
 (119,000) 119,000
 —
Settlements of derivative instruments —
 (7) —
 —
 (7)
Net cash used for investing activities —
 (341,120) (237,315) 119,000
 (459,435)
Cash flows from financing activities          
Intercompany financing 498,272
 (313,276) (184,996) —
 —
Receivable under the investment management
   agreement
 119,000
 —
 —
 (119,000) —
Debt issuance costs (376) —
 —
 —
 (376)
Dividends paid (76,491) —
 —
 —
 (76,491)
Distributions to noncontrolling interests —
 279,203
 (299,970) —
 (20,767)
Net proceeds from issuance of Westlake
   Chemical Partners LP common units
 —
 —
 110,739
 —
 110,739
Proceeds from issuance of notes payable —
 —
 5,946
 —
 5,946
Proceeds from drawdown of revolver 225,000
 —
 —
 —
 225,000
Restricted cash associated with term loan —
 —
 154,000
 —
 154,000
Repayment of term loan —
 —
 (150,000) —
 (150,000)
Repayment of notes payable —
 (788) (5,907) —
 (6,695)
Repayment of revolver (550,000) —
 —
 —
 (550,000)
Other 2,204
 —
 —
 —
 2,204
Net cash provided by (used for)
   financing activities
 217,609
 (34,861) (370,188) (119,000) (306,440)

36

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS��Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

  
Westlake
Chemical
Corporation
 
100% Owned
Guarantor
Subsidiaries
 
Non-
Guarantor
Subsidiaries
 Eliminations Consolidated
Effect of exchange rate changes on cash and
   cash equivalents
 —
 —
 21,991
 —
 21,991
Net increase (decrease) in cash and cash
   equivalents
 187,121
 (19,917) 51,576
 —
 218,780
Cash and cash equivalents at beginning of
   period
 146,990
 53,006
 259,457
 —
 459,453
Cash and cash equivalents at end of period $334,111
 $33,089
 $311,033
 $—
 $678,233

37

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in thousands of dollars, except share amounts and per share data)

Condensed Consolidating Financial Information for the Nine Months Ended September 30, 2016
  
Westlake
Chemical
Corporation
 
100% Owned
Guarantor
Subsidiaries
 
Non-
Guarantor
Subsidiaries
 Eliminations Consolidated
Statement of Cash Flows          
Cash flows from operating activities          
Net income $299,914
 $(46,596) $358,967
 $(297,715) $314,570
Adjustments to reconcile net income (loss) to
   net cash provided by (used for) operating
   activities
          
Depreciation and amortization —
 118,645
 108,548
 —
 227,193
Deferred income taxes (5,178) 100,908
 10,180
 —
 105,910
Net changes in working capital and other (313,676) (39,859) (47,693) 297,715
 (103,513)
Net cash provided by (used for)
   operating activities
 (18,940) 133,098
 430,002
 —
 544,160
Cash flows from investing activities          
Acquisition of business, net of cash acquired —
 (2,437,829) —
 —
 (2,437,829)
Additions to property, plant and equipment —
 (162,288) (305,042) —
 (467,330)
Additions to cost method investment —
 (4,000) —
 —
 (4,000)
Proceeds from disposition of assets —
 48
 165
 —
 213
Proceeds from sales and maturities of
   securities
 658,338
 —
 4,600
 —
 662,938
Purchase of securities (138,422) —
 —
 —
 (138,422)
Settlements of derivative instruments —
 (4,655) —
 —
 (4,655)
Net cash provided by (used for)
   investing activities
 519,916
 (2,608,724) (300,277) —
 (2,389,085)
Cash flows from financing activities          
Intercompany financing (2,242,604) 2,289,200
 (46,596) —
 —
Debt issuance costs (33,617) —
 (1,590) —
 (35,207)
Dividends paid (71,933) —
 —
 —
 (71,933)
Distributions to noncontrolling interests —
 202,210
 (214,510) —
 (12,300)
Proceeds from debt issuance 1,428,512
 —
 —
 —
 1,428,512
Proceeds from issuance of notes payable —
 —
 5,597
 —
 5,597
Proceeds from term loan and drawdown of
   revolver
 450,000
 —
 150,000
 —
 600,000
Restricted cash associated with term loan —
 —
 (154,000) —
 (154,000)
Repayment of notes payable —
 —
 (10,602) —
 (10,602)
Repayment of revolver (125,000) —
 —
 —
 (125,000)
Repurchase of common stock for treasury (67,406) —
 —
 —
 (67,406)
Other 2,840
 —
 —
 —
 2,840
Net cash provided by (used for)
   financing activities
 (659,208) 2,491,410
 (271,701) —
 1,560,501
Effect of exchange rate changes on cash and
   cash equivalents
 —
 —
 2,418
 —
 2,418
Net increase (decrease) in cash and cash
   equivalents
 (158,232) 15,784
 (139,558) —
 (282,006)
Cash and cash equivalents at beginning of
   period
 303,131
 6,818
 352,576
 —
 662,525
Cash and cash equivalents at end of period $144,899
 $22,602
 $213,018
 $—
 $380,519

38
Table of Contents



Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
This discussion and analysis should be read in conjunction with information contained in the accompanying unaudited consolidated interim financial statements of Westlake Chemical Corporation ("Westlake") and the notes thereto and the consolidated financial statements and notes thereto of Westlake Chemical Corporation included in Westlake Chemical Corporation's Annual Report on Form 10-K for the fiscal year ended December 31, 20162023 (the "2016"2023 Form 10-K"). Unless otherwise indicated, references in this report to "we," "our," "us" or like terms refer to Westlake Corporation ("Westlake" or the "Company"). The following discussion contains forward-looking statements. Please read "Forward-Looking Statements" for a discussion of limitations inherent in such statements.
Overview
We are a vertically integrated global manufacturer and marketer of petrochemicals, polymersperformance and buildingessential materials and housing and infrastructure products. OurWe operate in two principal operating segments, Performance and Essential Materials and Housing and Infrastructure Products. The Performance and Essential Materials segment includes Westlake North American Vinyls, Westlake North American Chlor-alkali & Derivatives, Westlake European & Asian Chlorovinyls, Westlake Olefins, Westlake Polyethylene and Westlake Epoxy. The Housing and Infrastructure Products segment includes Westlake Royal Building Products, Westlake Pipe & Fittings, Westlake Global Compounds and Westlake Dimex. We are Olefinshighly integrated along our materials chain with significant downstream integration from ethylene and Vinyls.chlor-alkali (chlorine and caustic soda) into vinyls, polyethylene, epoxy and styrene monomer. We usealso have substantial downstream integration from polyvinyl chloride ("PVC") into our building products, PVC pipes and fittings and PVC compounds in our Housing and Infrastructure Products segment.
During 2022 and 2023 our European businesses were impacted by higher energy prices, inflation and reduced demand. Our North American businesses, where we derive a majoritysignificant portion of our internally-produced basic chemicalsrevenue, also experienced the impacts of high energy costs and interest rates and slower demand for most of our products since the second half of 2022. However, since the second half of 2023 we have experienced lower energy costs in Europe and North America as prices for electricity and natural gas have declined following the elevated 2022 levels and inflation has eased since the 2022 levels, although it still remains a concern. In the near term, we expect that the volatility in energy prices, higher interest rates, inflation and other macroeconomic conditions will continue to produceimpact margins and demand for most of our products.
On February 1, 2022, we completed the acquisition of the global epoxy business of Hexion Inc. ("Westlake Epoxy") for total consideration of $1,207 million. The assets acquired and liabilities assumed and the results of operations of Westlake Epoxy are included in the Performance and Essential Materials segment. During the fourth quarter of 2023, the Westlake Epoxy business's sales volumes and prices, specifically base epoxy resins in Europe, continued to deteriorate. These lower sales volumes and prices have been primarily driven by record exports at lower prices of bisphenol-A, epichlorohydrin and base epoxy resins (constituting the epoxy value chain) out of Asia into Europe and North America during the time when demand in the European market was contracting. In addition, Westlake Epoxy operations in Europe have experienced sustained high energy and power costs. These factors negatively impacted Westlake Epoxy financial results during 2023. Based on these developments, along with management's outlook for the Westlake Epoxy business we determined, in the fourth quarter of 2023, that the carrying amount of long-lived assets of our base epoxy resin business in the Netherlands and all of the goodwill of the Westlake Epoxy business will not be recoverable in the foreseeable future. As a result of this assessment, a goodwill impairment charge of $128 million and a non-cash long-lived asset impairment charge of $347 million, related to our base epoxy resin business in the Netherlands, were recognized in the fourth quarter of 2023.
Recent Developments
Initiation of Antidumping and Countervailing Duty Investigations
On April 3, 2024, the U.S. Epoxy Resin Producers Ad Hoc Coalition, of which we are a member, filed petitions with the U.S. Department of Commerce and the U.S. International Trade Commission requesting the initiation of antidumping investigations regarding imports of certain epoxy resins from China, India, South Korea, Taiwan, and Thailand and countervailing duty investigations regarding imports of the same products from China, India, South Korea, and Taiwan.


22
Table of Contents

Performance and Essential Materials
Our performance and essential materials such as ethylene, PVC, polyethylene, epoxy and caustic soda are some of the most widely used materials in the world and are upgraded into a wide variety of higher value-added chemicalsproducts used in many end-markets. Westlake is the second-largest chlor-alkali producer and buildingthe second-largest PVC producer in the world, which makes Westlake a leading global chlorovinyls producer. Our performance and essential materials are used by customers in food and specialty packaging; industrial and consumer packaging; medical health applications; PVC pipe applications; consumer durables; mobility and transportation; renewable wind energy; coatings; and housing and construction products. Chlor-alkali and petrochemicals are typically manufactured globally in large volume by a number of different producers using widely available technologies. The chlor-alkali and petrochemical industries exhibit cyclical commodity characteristics, and margins are influenced by changes in the balance between supply and demand and the resulting operating rates, the level of general economic activity and the price of raw materials. Due to the significant size of new plants, capacity additions are built in large increments and typically require several years of demand growth to be absorbed. The cycle is generally characterized by periods of tight supply, leading to high operating rates and margins, followed by a decline in operating rates and margins primarily as a result of excess new capacity additions. Westlake is one of the leading producers of epoxy specialty resins, modifiers and curing agents in Europe, the United States and Asia with a global reach to our end markets. Epoxy resins are the fundamental component of many types of materials and are often used in the automotive, construction, wind energy, aerospace and electronics industries due to their superior adhesion, strength and durability. We are also a leading supplier of Liquid and Solid Epoxy Resin. These base epoxies are used in a wide variety of industrial coatings applications.
Since 2009Global demand for most of our products started to recover from the effects of the COVID-19 pandemic in the second half of 2020 and continuingremained strong through the thirdfirst half of 2022. However, since the second half of 2022 and during the early part of 2023, we saw significant volatility in natural gas and electricity costs, particularly in Europe, as well as in ethane and ethylene prices. We have experienced a decline in natural gas and electricity costs since the second half of 2023 through the first quarter of 2017, a cost advantage2024. Since the first half of 2022, we have continued to experience lower prices and weak demand for ethane-based ethylene producers over naphtha-based ethylene producers has allowed a strong export market for polyethylenemost of our products globally through the first quarter of 2024. The ongoing conflict between Russia and ethylene derivativesUkraine since Russia's invasion of Ukraine in 2022, the conflict in the Middle East, slow economic growth in China, increase in bisphenol-A, epichlorohydrin and higher margins forbase epoxy resin exports out of Asia into European and North American chemical producers, including Westlake. However, the falling crude oil prices in recent years have resulted in reduced prices and margins. Continued strong global demand for polyethylene has resulted in improved operating margins and cash flows for our Olefins segment in recent years. However, we have seen a significant reduction in the cost advantage enjoyed by North American ethane-based ethylene producers due to lower crude oil prices, beginning in the third quartermarkets, timing of 2014 and continuing through the third quarter of 2017. Looking forward,certain new ethylene and polyethylene capacity additions in North America, Asia, and the Middle East, volatility in natural gas and electricity prices, volatility in crude oil prices and inflationary pressures could have a number of new capacities announced in recent years, may lead to periods of over-supply and lower profitability. As a result, our Olefins segment operating margins may be negatively impacted.
Since the 2008 housing market collapse, continued slow recovery in the U.S. construction markets and budgetary constraints in municipal spending have contributed to lower North American demand for our vinyls products, which have negatively impacted our Vinyls segment operating rates and margins. However, since late 2010, the PVC industry in the U.S. has experienced an increase in PVC resin exports, driven largely by more competitive feedstock and energy cost positions in the U.S. As a consequence, the U.S. PVC resin industry operating rates have improved since 2010. In addition, our July 2014 acquisition of Vinnolit Holdings GmbH and its subsidiary companies ("Vinnolit"), an integrated global leader in specialty PVC resins, has contributed to improved operating margins and cash flows for our Vinyls segment. Globally, there were large chlor-alkali capacity additions between 2008 and 2015 resulting in excess capacity and lower industry operating rates which exerted downward pressure on caustic soda pricing. Announced capacity is now complete and increasing demand driven by the improving economic growth and U.S. producers' competitive export position is expected to result in improved operating rates and caustic soda pricing. On August 31, 2016, we completed the acquisition of Axiall Corporation ("Axiall") for $33.00 per share in an all-cash transaction (the "Merger"). The combined company is the third-largest global chlor-alkali producer and the third-largest PVC producer in the world. Westlake is the second-largest purchaser of ethylene in the U.S. and lower prices could positivelycontinuing negative impact our Vinyls segment.
The economic environment in the U. S. and globally appears to be improving. However, depending on the performance of the global economyPerformance and Essential Materials businesses.
As noted in Item 1A, "Risk Factors" in our 2023 Form 10-K, we are subject to extensive environmental regulations, which may impose significant additional costs on our operations in the remainderfuture. Further, concerns about greenhouse gas emissions and their possible effects on climate change has led to the enactment of 2017regulations, and beyond,to proposed legislation and additional regulations, that could affect us in the form of increased cost of feedstocks and fuel, other increased costs of production and decreased demand for our products. While we do not expect any of these enactments or proposals to have a material adverse effect on us in the near term, we cannot predict the longer-term effect of any of these regulations on our future financial condition, results of operations or cash flows.
Housing and Infrastructure Products
Our Housing and Infrastructure Products segment is primarily comprised of building products, PVC pipes and fittings and PVC compound products. Our sales are affected by the individual decisions of distributors and dealers on the levels of inventory they carry, their views on product demand, their financial condition and the manner in which they choose to manage inventory risk. A significant portion of our performance in this segment is driven by the activities in the residential construction and repair and remodeling markets in North America, which began to decline at the end of the second quarter of 2022 primarily due to the negative effect that rising mortgage rates in the United States had on buyer sentiment. In recent months, with the stabilization of interest rates and the possibility of interest rate cuts by the U.S. Federal Reserve in the near term, we have seen signs of improvement in the demand for housing products. Performance of our housing and infrastructure products businesses over time are generally reflective of the trends of building permits and housing starts in the New Residential Construction Survey by the U.S. Census Bureau and the Repair and Remodeling Index (RRI) provided by the National Association of Home Builders (the "NAHB") among others. Although we ultimately expect that the Infrastructure Investment and Jobs Act of 2021 and historically low residential housing construction may have a favorable long-term impact on certain industries related to our Housing and Infrastructure Products segment, the current inflationary environment impacting consumer spending and priorities and decade-high mortgage interest rates impacting consumer affordability are expected to have an unfavorable impact on the demand for housing construction in the near term and, as a result, our products produced by this segment.
23
Table of Contents

Factors that have caused volatility in our raw material prices, energy costs and production processes in the past, and which may do so in the future, include significant fluctuation in prices of these raw materials in response to, among other things, variable worldwide supply and demand across different industries, speculation in commodities futures, general economic, business or environmental conditions, labor costs, competition, import duties, tariffs, worldwide currency fluctuations, freight, inflationary pressures, regulatory costs, and product and process evolutions that impact demand for the same materials. Increasing raw material prices directly impact our cost of sales and our ability to maintain margins depends on implementing price increases in response to increasing raw material costs. The market for our products may or may not accept price increases, and as such, our future financial condition, results of operations or cash flows could be negativelymaterially impacted.
Non-GAAP Financial Measures
The body of accounting principles generally accepted in the United States is commonly referred to as "U.S. GAAP."GAAP." For this purpose, a non-GAAP financial measure is generally defined by the Securities and Exchange Commission ("SEC") as one that purports to measure historical or future financial performance, financial position or cash flows butthat (1) excludes amounts, or includesis subject to adjustments that have the effect of excluding amounts, that would not be so adjustedare included in the most directly comparable measure calculated and presented in accordance with GAAP measures.in the statement of income, balance sheet or statement of cash flows (or equivalent statements) of the registrant; or (2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. In this report, we disclose non-GAAP financial measures, primarily earnings before interest, taxes, depreciation and amortization ("EBITDA"). and Free Cash Flow. We define EBITDA is calculated as net income before interest expense, income taxes, depreciation and amortization. We define Free Cash Flow as net cash provided by operating activities less additions to property, plant and equipment. The non-GAAP financial measures described in this Form 10-Q are not substitutes for the GAAP measures of earnings and cash flow.

39
Table of Contents


flows.
EBITDA is included in this Form 10-Q because our management considers it an important supplemental measure of our performance and believes that it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry, some of which present EBITDA when reporting their results. We regularly evaluate our performance as compared to other companies in our industry that have different financing and capital structures and/or tax rates by using EBITDA. In addition, we utilize EBITDA in evaluating acquisition targets. Management also believes that EBITDA is a useful tool for measuring our ability to meet our future debt service and satisfy capital expendituresexpenditure and working capital requirements, and EBITDA is commonly used by us and our investors to measure our ability to service indebtedness.
Free Cash Flow is included in this Form 10-Q because our management considers it an important supplemental measure of our performance and believes that it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry, some of which present Free Cash Flow when reporting their results. We regularly evaluate our performance as compared to other companies in our industry that have different financing and capital structures and/or tax rates by using Free Cash Flow. Management also believes that Free Cash Flow is useful to investors and securities analysts to evaluate our liquidity, evaluate strategic investment, evaluate our stock buyback plan and measure our ability to meet our future debt service.
EBITDA isand Free Cash Flow are not a substitutesubstitutes for the GAAP measures of earnings or ofnet income, income from operations and net cash flowprovided by operating activities and isare not necessarily a measuremeasures of our ability to fund our cash needs. In addition, it should be noted that companies calculate EBITDA and Free Cash Flow differently and, therefore, EBITDA and Free Cash Flow as presented for us may not be comparable to EBITDA and Free Cash Flow reported by other companies. EBITDA has material limitations as a performance measure because it excludes interest expense, depreciation and amortization and income taxes.
Recent Developments
On September 29, 2017, Westlake Chemical Partners, LP ("WLKP") completed Free Cash Flow has material limitations as a secondary offeringperformance measure because it only considers net cash provided by operating activities, and not net income or income from operations. For instance, it applies the entire cost of 5,175,000 common units at a price of $22.00 per unit and purchased an additional 5.0% newly-issued limited partner interest in Westlake Chemical OpCo LP ("OpCo") for approximately $229.2 million resulting in an aggregate 18.3% limited partner interest in OpCo effective July 1, 2017. Net proceeds to WLKP from the sale of the units was $110.7 million, net of underwriting discounts, structuring fees and estimated offering expenses of approximately $3.1 million. WLKP used the proceeds from the offering and the existing revolving credit facility with Westlake Chemical Finance Corporation, our subsidiary, to fund the purchase of the additional 5.0% interest in OpCo.
During September 2017, we directed the Louisiana Local Government Authority Environmental Facilities and Community Development Authority (the “Authority”) to optionally redeem in full $250.0 million aggregate principal amount of the 2007 Series revenue bonds (the “GO Zone Bonds”) on November 1, 2017 at a redemption price of par, plus accrued and unpaid interest, if any, to the redemption date. The GO Zone Bonds were issued by the Authority in December 2007 under the Gulf Opportunity Zone Act of 2005 (GO Zone Act) for the benefit of the Company and were subject to optional redemption by the Authority at any time on or after November 1, 2017 for 100.0% of the principal plus accrued unpaid interest, if any. In connection with the redemption of the Go Zone Bonds, the Authority is required to cause the GO Zone Bonds trustee to surrender the 6 ¾% tax exempt senior notes due November 2032 of $250.0 million, to the Senior Notes trustee for cancellation. We used cash on hand to fund the redemption of the GO Zone Bonds.
On August 30, 2017, following WLKP's cash distribution for the second quarter of 2017, the requirement under WLKP's partnership agreement for the conversion of all subordinated units was satisfied. As a result, effective August 30, 2017, the 12,686,115 subordinated units owned by us were converted into common units on a one-for-one basis and thereafter participate on terms equal with all other common units in distributions of available cash.
On August 1, 2017, the Company, WLKP and OpCo executed an Investment Management Agreement (the "Investment Management Agreement") that authorized Westlake to invest the Partnership's and OpCo's excess cash.
On August 1, 2017, our wholly owned subsidiary, Westlake Chemical Finance Corporation, entered into an amendment to the revolving credit facility with WLKP, resultingcapital expenditure in the extensionperiod in which the property or equipment is acquired, rather than spreading it over several periods as is the case with net income and income from operations.
Reconciliations of EBITDA to net income, income from operations and net cash provided by operating activities, and Free Cash Flow to net cash provided by operating activities are included in the credit facility's maturity date from April 29, 2018 to April 29, 2021.

"Results of Operations" section below.
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Results of Operations
Segment Data
  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017 2016
         
  (dollars in thousands, except per share data)
Net external sales        
Olefins        
Polyethylene $377,269
 $380,810
 $1,121,603
 $1,098,500
Styrene, feedstock and other 124,974
 116,555
 412,869
 324,369
Total Olefins 502,243
 497,365
 1,534,472
 1,422,869
Vinyls        
PVC, caustic soda and other 1,252,963
 599,276
 3,541,409
 1,492,650
Building products 353,683
 182,387
 954,785
 424,757
Total Vinyls 1,606,646
 781,663
 4,496,194
 1,917,407
Total $2,108,889
 $1,279,028
 $6,030,666
 $3,340,276
         
Income (loss) from operations        
Olefins $165,438
 $118,475
 $488,532
 $408,274
Vinyls 216,515
 22,235
 431,276
 136,559
Corporate and other (16,206) (94,147) (51,647) (116,056)
Total income from operations 365,747
 46,563
 868,161
 428,777
Interest expense (40,036) (24,366) (118,784) (36,966)
Other income, net 2,058
 41,265
 6,591
 52,091
Provision for (benefit from) income taxes 108,619
 (6,552) 232,690
 129,332
Net income 219,150
 70,014
 523,278
 314,570
Net income attributable to noncontrolling interests 8,318
 4,352
 21,429
 14,656
Net income attributable to Westlake Chemical
   Corporation
 $210,832
 $65,662
 $501,849
 $299,914
Diluted earnings per share $1.61
 $0.51
 $3.85
 $2.29
EBITDA (1)
 $521,439
 $182,057
 $1,323,285
 $708,061
The table below and descriptions that follow represent the consolidated results of operations of the Company for the three months endedMarch 31, 2024 and 2023.
Net External Sales
The table below presents net external sales on a disaggregated basis for our two principal operating segments. Performance Materials net external sales primarily consist of sales of PVC, polyethylene and epoxy. Essential Materials net external sales primarily consist of sales of caustic soda, styrene, and related derivative materials. Housing Products net external sales primarily consist of sales of housing exterior and interior products, residential pipes and fittings and residential PVC compounds. Infrastructure Products net external sales primarily consist of sales of non-residential pipes and fittings and non-residential PVC compounds.
Three Months Ended March 31,
20242023
(in millions of dollars, except per share data)
Net external sales
Performance and Essential Materials
Performance Materials$1,164 $1,282 
Essential Materials767 1,067 
Total Performance and Essential Materials1,931 2,349 
Housing and Infrastructure Products
Housing Products879 818 
Infrastructure Products165 189 
Total Housing and Infrastructure Products1,044 1,007 
$2,975 $3,356 
Income (loss) from operations
Performance and Essential Materials$22 $403 
Housing and Infrastructure Products210 143 
Corporate and other(9)(10)
Total income from operations223 536 
Interest expense(40)(42)
Other income, net50 22 
Provision for income taxes48 109 
Net income185 407 
Net income attributable to noncontrolling interests11 13 
Net income attributable to Westlake Corporation$174 $394 
Diluted earnings per share$1.34 $3.05 
EBITDA (1)
$546 $825 
Free Cash Flow (2)
$(103)$245 
_____________
(1)See "Reconciliation of EBITDA to Net Income and to Net Cash Provided by Operating Activities" below.

(1)See above for discussions on non-GAAP financial measures. See "Reconciliation of EBITDA to Net Income, Income from Operations and Net Cash Provided by Operating Activities" below.
(2)See above for discussions on non-GAAP financial measures. See "Reconciliation of Free Cash Flow to Net Cash Provided by Operating Activities" below.
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  Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017
  Average
Sales Price		 Volume Average
Sales Price		 Volume
Product sales price and volume percentage change
   from prior-year period
        
Olefins +1.8% -0.8 % +9.2% -1.3 %
Vinyls +18.7% +86.8 % +17.8% +116.7 %
Company average +12.1% +52.8 % +14.1% +66.4 %
         
  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017 2016
Average industry prices (1)
        
Ethane (cents/lb) 8.8
 6.3
 8.3
 6.2
Propane (cents/lb) 18.2
 11.2
 16.6
 10.7
Ethylene (cents/lb) (2)
 24.7
 32.5
 27.8
 26.5
Polyethylene (cents/lb) (3)
 70.7
 68.7
 69.0
 65.3
Styrene (cents/lb) (4)
 85.1
 66.8
 85.0
 63.3
Caustic soda ($/short ton) (5)
 811.7
 660.8
 777.8
 618.3
Chlorine ($/short ton) (6)
 332.5
 304.2
 320.8
 295.3
PVC (cents/lb) (7)
 62.5
 56.5
 61.7
 53.9
_____________
Three Months Ended March 31, 2024
(1)Average
Sales Price		Industry pricing data was obtained from IHS Chemical. We have not independently verified the data.
Volume
(2)Net sales percentage change from prior-year period due to average sales price and volumeRepresents average North American spot prices of ethylene over the period as reported by IHS Chemical.
Performance and Essential Materials-23 %+5 %
(3)Housing and Infrastructure ProductsRepresents average North American net transaction prices of polyethylene low density GP-Film grade over the period as reported by IHS Chemical.
-10 %+14 %
(4)Company averageRepresents average North American contract prices of styrene over the period as reported by IHS Chemical.
-19 %+8 %
(5)Represents average North American undiscounted contract prices of caustic soda over the period as reported by IHS Chemical.
(6)Three Months Ended March 31, 2024Represents average North American contract prices of chlorine (into chemicals) over the period as reported by IHS Chemical.
(7)Domestic US prices percentage change from prior-year period for fuel cost and feedstockRepresents average North American contract prices of polyvinyl chloride (PVC) over the period as reported by IHS Chemical. Effective January 1, 2017, IHS Chemical made a non-market downward adjustment of 15 cents per pound to PVC prices. For comparability, we adjusted each prior-year period's PVC price downward by 15 cents per pound consistent with the IHS Chemical non-market adjustment.
Fuel cost (Natural Gas)-33 %
Feedstock (Ethane)-23 %
Reconciliation of EBITDA to Net Income, Income from Operations and to Net Cash Provided by Operating Activities
The following table presents the reconciliation of EBITDA to net income, income from operations and to net cash provided by operating activities, the most directly comparable GAAP financial measures, for each of the periods indicated.
Three Months Ended March 31,
20242023
(in millions of dollars)
Net cash provided by operating activities$169 $512 
Changes in operating assets and liabilities and other(6)(121)
Deferred income taxes22 16 
Net income185 407 
Less:
Other income, net50 22 
Interest expense(40)(42)
Provision for income taxes(48)(109)
Income from operations223 536 
Add:
Depreciation and amortization273 267 
Other income, net50 22 
EBITDA$546 $825 
  Three Months Ended September 30, Nine Months Ended September 30,
  2017 2016 2017 2016
         
  (dollars in thousands)
Net cash provided by operating activities $482,950
 $174,268
 $962,664
 $544,160
Changes in operating assets and liabilities and other (255,468) (101,334) (416,092) (123,680)
Deferred income taxes (8,332) (2,920) (23,294) (105,910)
Net income 219,150
 70,014
 523,278
 314,570
Add:        
Depreciation and amortization 153,634
 94,229
 448,533
 227,193
Interest expense 40,036
 24,366
 118,784
 36,966
Provision for (benefit from) income taxes 108,619
 (6,552) 232,690
 129,332
EBITDA $521,439
 $182,057
 $1,323,285
 $708,061
Reconciliation of Free Cash Flow to Net Cash Provided by Operating Activities

The following table presents the reconciliation of Free Cash Flow to net cash provided by operating activities, the most directly comparable GAAP financial measure, for each of the periods indicated.
Three Months Ended March 31,
20242023
(in millions of dollars)
Net cash provided by operating activities$169 $512 
Less:
Additions to property, plant and equipment272 267 
Free Cash Flow$(103)$245 
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Summary
For the quarter ended September 30, 2017,March 31, 2024, net income attributable to Westlake Chemical Corporation was $210.8$174 million, or $1.61$1.34 per diluted share, on net sales of $2,108.9$2,975 million. This represents an increasea decrease in net income attributable to Westlake Chemical Corporation of $145.1$220 million, or $1.10$1.71 per diluted share, compared to the third quarter of 2016ended March 31, 2023 net income attributable to Westlake Chemical Corporation of $65.7$394 million, or $0.51$3.05 per diluted share, on net sales of $1,279.0$3,356 million. Net incomeIncome from operations for the third quarter ended March 31, 2024 was $223 million, a $313 million decrease from income from operations of 2017 increased versus$536 million for the prior-year periodquarter ended March 31, 2023. The decrease in net income and income from operations was primarily due to (1) earnings contributed by Axiall, which was acquired on August 31, 2016; (2) lower transaction and integration-related costs associated with the acquisition; and (3) higher sales prices for majormost of our products. While results in our Performance and Essential Materials segment reflected continued weak global industrial and manufacturing activity, our Housing and Infrastructure Products segment benefited from continued strong demand in housing end markets. The overall decrease in net income and income from operations in the first quarter of 2024 were partially offset by lower natural gas and feedstock costs and lower selling, general and administrative expenses. Net income was also positively impacted by higher interest income. Net sales decreased by $381 million to $2,975 million in the quarter ended March 31, 2024 from $3,356 million in the quarter ended March 31, 2023, primarily due to lower sales prices for most of our products resultingacross both segments, partially offset by an increase in improved margins. These increases,sales volumes for some of our products in both segments.
RESULTS OF OPERATIONS
First Quarter 2024 Compared with First Quarter 2023
Net Sales. Net sales decreased by $381 million, or 11%, to $2,975 million in the first quarter of 2024 from $3,356 million in the first quarter of 2023, primarily due to lower sales prices for most of our products across both segments. Average sales prices for the first quarter of 2024 decreased by 19% as compared to the thirdfirst quarter of 2016, were partially offset by (1) higher interest expense due to the increased debt balance2023 as a result of continuing lower demand for several of our products in the Axiall acquisition; (2) a third quarter 2016 realized gain of $49.1 million fromPerformance and Essential Materials segment including caustic soda. Sales volumes increased by 8% in the previously held common stock of Axiall; and (3) a higher effective tax rate. Net sales for the thirdfirst quarter of 2017 increased by $829.9 million compared to net sales for the third quarter of 2016, mainly due to higher sales contributed by Axiall and higher sales prices for our major products. Income from operations was $365.7 million for the third quarter of 2017 as compared to $46.6 million for the third quarter of 2016. The increase in income from operations for the third quarter of 2017 was mainly a result of earnings contributed by Axiall, lower transaction and integration-related costs and higher sales prices2024 as compared to the thirdfirst quarter of 2016.2023, due to increased demand for several of our products in the Housing and Infrastructure segment and a slight improvement in sales volume for polyethylene and PVC resins in the Performance and Essential Materials segment.
Gross Profit. Gross profit margin percentage was 16% in the first quarter of 2024 as compared to 24% in the first quarter of 2023. The decrease in gross profit margin was primarily due to lower prices for most of our products, which was partially offset by lower natural gas and feedstock costs.
Selling, General and Administrative Expenses. Selling, general and administrative expenses decreased by $13 million to $209 million in the first quarter of 2024 as compared to $222 million in the first quarter of 2023. This decrease was mainly due to lower compensation expenses.
Amortization of Intangibles. Amortization expense in the first quarter of 2024 was comparable with the first quarter of 2023.
Restructuring, Transaction and Integration-related Costs. Restructuring, transaction and integration-related costs in the thirdfirst quarter of 20172024 were $6.7comparable with the first quarter of 2023.
Interest Expense. Interest expense decreased slightly by $2 million or $0.03 per diluted share.to $40 million in the first quarter of 2024 from $42 million in the first quarter of 2023, primarily due to higher capitalized interest on capital projects.
ForOther Income, Net. Other income, net increased by $28 million to $50 million in the nine months ended September 30, 2017, netfirst quarter of 2024 from $22 million in the first quarter of 2023, substantially due to higher interest income attributable to Westlake Chemical Corporationa higher average cash and cash equivalents balance and higher interest rates in the first quarter of 2024 as compared to the first quarter of 2023.
Income Taxes. The effective income tax rate was $501.8 million, or $3.85 per diluted share, on net sales20.6% for the first quarter of $6,030.7 million. This represents2024 as compared to 21.1% for the first quarter of 2023. The effective tax rate in the first quarter of 2024 was lower compared to the first quarter of 2023 primarily due to an increase in net income attributableU.S. federal research and development credits available to Westlake Chemical Corporationthe Company and lower state taxes partially offset by higher foreign taxes.
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Performance and Essential Materials Segment
Net Sales. Net sales for the Performance and Essential Materials segment decreased by $418 million, or $1.56 per diluted share,18%, to $1,931 million in the first quarter of 2024 from $2,349 million in the first quarter of 2023. Average sales prices for the Performance and Essential Materials segment decreased by 23% in the first quarter of 2024 as compared to the nine months ended September 30, 2016 net income attributable to Westlake Chemical Corporationfirst quarter of $299.9 million, or $2.29 per diluted share, on net2023. Lower Performance Materials sales of $3,340.3 million. Net income for the nine months ended September 30, 2017 increased versus the prior-year periodprices were primarily due to (1) earnings contributedlower PVC resin, polyethylene and epoxy sales prices. Lower Essential Materials sales prices were primarily due to lower caustic soda sales prices. Sales volumes for the Performance and Essential Materials segment increased by Axiall; (2)5% in the first quarter of 2024 as compared to the first quarter of 2023 primarily due to higher polyethylene and PVC resins sales volumes.
Income from Operations. Income from operations for the Performance and Essential Materials segment decreased by $381 million to $22 million in the first quarter of 2024 from $403 million in the first quarter of 2023. This decrease in income from operations in the first quarter of 2024, as compared to the first quarter of 2023, was primarily due to lower sales prices for our major products, resulting in improved margins;particularly caustic soda and (3) lower transaction and integration-related costs associated with the integration of Axiall.epoxy resin. These increases versus the prior-year perioddecreases were partially offset by higher interest expense due to the increased debt balancesales volume and the realized gain in the nine months ended September 30, 2016 of $49.1 million from the previously held common stock of Axiall.lower natural gas and feedstock costs.
Housing and Infrastructure Products Segment
Net Sales. Net sales for the nine months ended September 30, 2017Housing and Infrastructure Products segment increased by $2,690.4$37 million, comparedor 4%, to net sales for$1,044 million in the nine months ended September 30, 2016, mainly due to higher sales contributed by Axiall, which was acquired on August 31, 2016, and higherfirst quarter of 2024 from $1,007 million in the first quarter of 2023. Average sales prices for the Housing and Infrastructure Products segment decreased by 10% in the first quarter of 2024 as compared to the first quarter of 2023, primarily due to lower sales prices across all of our major products. products in this segment. Sales volumes for the Housing and Infrastructure Products segment increased by 14% in the first quarter of 2024 as compared to the first quarter of 2023 primarily due to strong demand in housing end markets, particularly for pipe and fittings and siding and trim.
Income from Operations. Income from operations was $868.2 million for the nine months ended September 30, 2017 as comparedHousing and Infrastructure Products segment increased by $67 million to $428.8$210 million forin the nine months ended September 30, 2016. Thefirst quarter of 2024 from $143 million in the first quarter of 2023. This increase in income from operations was mainly a result of earnings contributed by Axiall, higher sales prices for our major products and lower transaction and integration-related costs. Transaction and integration-related costs in the nine months ended September 30, 2017 were $22.9 million, or $0.12 per diluted share.
RESULTS OF OPERATIONS
Third Quarter 2017 Compared with Third Quarter 2016
Net Sales. Net sales increased by $829.9 million, or 64.9%, to $2,108.9 million in the thirdfirst quarter of 2017 from $1,279.0 million in the third quarter of 2016, primarily attributable to sales contributed by Axiall, which was acquired on August 31, 2016, and higher sales prices. Average sales prices for the third quarter of 2017 increased by 12.1%2024, as compared to the thirdfirst quarter of 2016. Overall sales volumes increased by 52.8% as compared to the third quarter of 2016, primarily attributable to sales contributed by Axiall, as compared to the prior-year period.
Gross Profit. Gross profit margin percentage increased to 23.6% in the third quarter of 2017 from 15.8% in the third quarter of 2016. The third quarter of 2017 gross profit margin2023, was higher primarily due to lower raw material costs and higher sales volumes for caustic sodapipe and PVC resin contributed by Axiallfittings and an increase in sales prices for our major products as compared to the third quarter of 2016. The increase was partially offset by higher feedstock costssiding and higher energy prices, as compared to the third quarter of 2016.
Selling, General and Administrative Expenses. Selling, general and administrative expenses increased by $52.9 million to $125.6 million in the third quarter of 2017 as compared to $72.7 million in the third quarter of 2016. This increase was mainly due to selling, general and administrative expenses of Axiall which were primarily comprised of the amortization of intangible assets acquired on acquisition.

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Transaction and Integration-related Costs. The transactions and integration-related costs were $6.7 million in the third quarter of 2017 as compared to $82.8 million in the third quarter of 2016. Transaction and integration-related costs were lower by $76.1 million in the third quarter of 2017 as compared to the third quarter of 2016 predominantly because significant transaction and integration-related costs were incurred at the time of the Merger in the third quarter of 2016. The transaction and integration costs for the third quarter of 2017 primarily consisted of severance benefits provided to former Axiall employees in conjunction with the Merger and integration costs and consulting fees related to the Merger. The transaction and integration-related costs for the third quarter of 2016 primarily consisted of severance benefits provided to former Axiall executives in conjunction with the Merger, including the conversion of Axiall restricted stock units into our restricted stock units, transitional service expenses for certain former Axiall employees, retention agreement costs and consulting and professional fees related to the Merger.
Interest Expense. Interest expense increased by $15.6 million to $40.0 million in the third quarter of 2017 from $24.4 million in the third quarter of 2016 primarily as a result of higher average debt outstanding for the period as well as decreased capitalized interest on major capital projects in the third quarter of 2017 as compared to the third quarter of 2016. The debt balance increased in August 2016 to finance the Merger. See "Liquidity and Capital Resources—Debt" below for further discussion on our indebtedness.
Other Income (Expense), Net. Other income, net decreased by $39.2 million to income of $2.1 million in the third quarter of 2017 from income of $41.3 million in the third quarter of 2016. The decrease was primarily attributable to the realized gain in the third quarter of 2016 of $49.1 million from the previously held common stock of Axiall.
Income Taxes. The effective income tax rate was 33.1% for the third quarter of 2017. The effective income tax rate for the third quarter of 2017 was below the U.S. federal statutory rate of 35.0% primarily due to a higher domestic manufacturing deduction, depletion deductions, income attributable to noncontrolling interests, research and development credits and the foreign earnings rate differential, partially offset by state income taxes. The effective tax rate, which was a benefit, was (10.3)% for the three months ended September 30, 2016. The effective income tax rate for the third quarter of 2016 was below the U.S. federal statutory rate of 35.0% primarily due to the benefit of state tax credits, the domestic manufacturing deduction, depletion deductions, income attributable to noncontrolling interests, the non-recognition of tax related to the gain recognized on previously held outstanding shares of common stock of Axiall, the benefit in prior years' and current-year tax credits for increased research and development expenditures, adjustments related to prior years' tax returns as filed and the foreign earnings rate differential, partially offset by state income taxes and nondeductible transaction costs related to the Merger.
Olefins Segment
Net Sales. Net sales for the Olefins segment increased by $4.8 million, or 1.0%, to $502.2 million in the third quarter of 2017 from $497.4 million in the third quarter of 2016, primarily due to higher sales prices. Average sales volumes for the Olefins segment decreased by 0.8% in the third quarter of 2017 as compared to the third quarter of 2016. Average sales prices for the Olefins segment increased by 1.8% in the third quarter of 2017 as compared to the third quarter of 2016.
Income from Operations. Income from operations for the Olefins segment increased by $46.9 million to $165.4 million in the third quarter of 2017 from $118.5 million in the third quarter of 2016. This increase was mainly attributable to higher sales prices and higher overall operating rates. These increases were partially offset by higher feedstock and energy costs. Trading activity in the third quarter of 2017 resulted in a gain of $6.8 million as compared to a loss of $7.8 million in the third quarter of 2016.
Vinyls Segment
Net Sales. Net sales for the Vinyls segment increased by $824.9 million, or 105.5%, to $1,606.6 million in the third quarter of 2017 from $781.7 million in the third quarter of 2016. This increase was mainly attributable to higher sales contributed by Axiall and higher sales prices for our major products. Net sales for the three months ended September 30, 2017 were higher as compared to the prior-year period primarily because a full three months of Axiall's operations were included as compared to only one month of Axiall's operations included in the prior-year period. Average sales prices for the Vinyls segment increased by 18.7% in the third quarter of 2017 as compared to the third quarter of 2016. Average sales volumes for the Vinyls segment increased by 86.8% in the third quarter of 2017 as compared to the third quarter of 2016, primarily attributable to sales contributed by Axiall, as compared to the prior-year period.
Income from Operations. Income from operations for the Vinyls segment increased by $194.3 million to $216.5 million in the third quarter of 2017 from $22.2 million in the third quarter of 2016. This increase was mainly attributable to earnings contributed by Axiall and higher sales prices for our major products. These increases were partially offset by higher energy prices during the quarter ended September 30, 2017, as compared to the prior-year period.

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Nine Months Ended September 30, 2017 Compared with Nine Months Ended September 30, 2016
Net Sales. Net sales increased by $2,690.4 million, or 80.5%, to $6,030.7 million for the nine months ended September 30, 2017 from $3,340.3 million for the nine months ended September 30, 2016, primarily attributable to higher sales contributed by Axiall, which was acquired on August 31, 2016, and higher sales prices for our major products, as compared to the nine months ended September 30, 2016. Average sales prices for the nine months ended September 30, 2017 increased by 14.1% as compared to the nine months ended September 30, 2016. Overall sales volumes increased by 66.4% as compared to the nine months ended September 30, 2016, primarily attributable to sales contributed by Axiall, as compared to the prior-year period.
Gross Profit. Gross profit margin percentage increased to 21.1% for the nine months ended September 30, 2017 from 20.9% for the nine months ended September 30, 2016. The gross profit margin for the nine months ended September 30, 2017 was slightly higher primarily due to higher sales volumes for caustic soda and PVC resin contributed by Axiall and higher sales prices for our major products, as compared to the nine months ended September 30, 2016. These increases were substantially offset by a proportionately larger sales volume for the Vinyls segment as compared to the Olefins segment, Vinyls segment industry margins were lower as compared to those of the Olefins segment industry for the nine months ended September 30, 2017 and the nine months ended September 30, 2016.
Selling, General and Administrative Expenses. Selling, general and administrative expenses increased by $200.1 million to $379.9 million for the nine months ended September 30, 2017 as compared to $179.8 million in the nine months ended September 30, 2016. This increase was mainly due to selling, general and administrative expenses of Axiall which were primarily comprised of the amortization of intangible assets acquired on acquisition.
Transaction and Integration-related Costs. Transaction and integration-related costs were $22.9 million for the nine months ended September 30, 2017 as compared to $90.6 million for the nine months ended September 30, 2016. Transaction and integration-related costs were $67.7 million lower in the nine months ended September 30, 2017 as compared to the nine months ended September 30, 2016 predominantly because significant transaction and integration-costs were incurred at the time of the Merger in 2016. The transaction and integration costs for the nine months ended September 30, 2017 primarily consisted of severance benefits provided to former Axiall employees in conjunction with the Merger and integration costs and consulting fees related to the Merger. The transaction and integration costs for the nine months ended September 30, 2016 primarily consisted of severance benefits provided to former Axiall executives in conjunction with the Merger, including the conversion of Axiall restricted stock units into our restricted stock units, transitional service expenses for certain former Axiall employees, retention agreement costs and consulting and professional fees related to the Merger.
Interest Expense. Interest expense increased by $81.8 million to $118.8 million for the nine months ended September 30, 2017 from $37.0 million for the nine months ended September 30, 2016 primarily as a result of higher average debt outstanding for the period as well as decreased capitalized interest on major capital projects in the nine months ended September 30, 2017 as compared to the nine months ended September 30, 2016. The debt balance increased in August 2016 to finance the Merger. See "Liquidity and Capital Resources—Debt" below for further discussion on our indebtedness.
Other Income, Net. Other income, net decreased by $45.5 million to $6.6 million in the nine months ended September 30, 2017 from $52.1 million in the nine months ended September 30, 2016. The decrease was mainly attributable to the realized gain in the 2016 period of $49.1 million from the previously held common stock of Axiall.
Income Taxes. The effective income tax rate was 30.8% for the nine months ended September 30, 2017. The effective income tax rate for the nine months ended September 30, 2017 was below the U.S. federal statutory rate of 35.0% primarily due to certain discrete adjustments, a higher domestic manufacturing deduction, depletion deductions, income attributable to noncontrolling interests, research and development credits and the foreign earnings rate differential, partially offset by state income taxes. The effective income tax rate was 29.1% for the nine months ended September 30, 2016. The effective income tax rate for the nine months ended September 30, 2016 was below the U.S. federal statutory rate of 35.0% primarily due to the benefit of state tax credits, the domestic manufacturing deduction, depletion deductions, income attributable to noncontrolling interests, the non-recognition of tax related to the gain recognized on previously held outstanding shares of common stock of Axiall, the benefit in prior years' and current-year tax credits for increased research and development expenditures, adjustments related to prior years' tax returns as filed and the foreign earnings rate differential, partially offset by state income taxes and nondeductible transaction costs related to the Merger.

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Olefins Segment
Net Sales. Net sales for the Olefins segment increased by $111.6 million, or 7.8%, to $1,534.5 million in the nine months ended September 30, 2017 from $1,422.9 million in the nine months ended September 30, 2016, primarily due to higher sales prices for our major products. Average sales prices for the Olefins segment increased by 9.2% in the nine months ended September 30, 2017 as compared to the nine months ended September 30, 2016. Average sales volumes for the Olefins segment decreased by 1.3% in the nine months ended September 30, 2017 as compared to the nine months ended September 30, 2016.
Income from Operations. Income from operations for the Olefins segment increased by $80.2 million to $488.5 million in the nine months ended September 30, 2017 from $408.3 million in the nine months ended September 30, 2016. This increase was mainly attributable to higher olefins integrated product margins, primarily due to higher sales prices for our major products, higher operating rates and lower costs associated with turnarounds and outages as compared to the prior-year period. These increases were partially offset by higher energy prices. The nine months ended September 30, 2016 were negatively impacted by the planned turnaround and expansion of the Lake Charles Petro 1 ethylene unit along with other unplanned outages. Trading activity in the nine months ended September 30, 2017 resulted in a loss of $2.8 million as compared to a gain of $7.8 million in the nine months ended September 30, 2016.
Vinyls Segment
Net Sales. Net sales for the Vinyls segment increased by $2,578.8 million, or 134.5%, to $4,496.2 million in the nine months ended September 30, 2017 from $1,917.4 million in the nine months ended September 30, 2016. This increase was mainly attributable to sales contributed by Axiall and higher sales prices and volumes for our major products. The net sales for the nine months ended September 30, 2017 was higher as compared to the prior-year period primarily because nine months of Axiall's operations were included in the current period as compared to one month of Axiall operations included in the prior-year period. Average sales prices for the Vinyls segment increased by 17.8% in the nine months ended September 30, 2017 as compared to the nine months ended September 30, 2016. Average sales volumes for the Vinyls segment increased by 116.7% in the nine months ended September 30, 2017 as compared to the nine months ended September 30, 2016, primarily attributable to sales contributed by Axiall, as compared to the prior-year period.
Income from Operations. Income from operations for the Vinyls segment increased by $294.7 million to $431.3 million in the nine months ended September 30, 2017 from $136.6 million in the nine months ended September 30, 2016. This increase was mainly attributable to earnings contributed by Axiall and higher sales prices and volumes for our major products. These increases were partially offset by unabsorbed fixed manufacturing costs and other costs associated with the planned turnaround and expansion at the Calvert City facility and other planned and unplanned turnarounds as well as higher energy prices during the nine months ended September 30, 2017, as compared to the prior-year period.trim.
CASH FLOW DISCUSSION FOR THE NINETHREE MONTHS ENDED SEPTEMBER 30, 2017MARCH 31, 2024 AND 20162023
Cash Flows
Operating Activities
Operating activities provided cash of $962.7$169 million in the first ninethree months of 20172024 compared to cash provided by operating activities of $544.2$512 million in the first ninethree months of 2016.2023. The $418.5$343 million increasedecrease in cash flows from operating activities was mainly due to an increase in income from operationslower prices and lower turnaround related expenditures during the nine months ended September 30, 2017 as compared to the first nine monthsdemand for most of 2016, partially offset by an increaseour products and unfavorable changes in working capital requirements. The increase in net income from operations for the first ninethree months of 2017 was mainly as a result of higher sales prices and volumes, resulting in a higher margin, and earnings contributed by Axiall, which was acquired on August 31, 2016.2024. Changes in components of working capital, which we define for purposes of this cash flow discussion as accounts receivable, net, inventories, prepaid expenses and other current assets, less accounts payable and accrued and other liabilities, used cash of $26.2$177 million in the first ninethree months of 2017,2024, compared to $10.5$64 million of cash providedused in the first ninethree months of 2016,2023, an unfavorable change of $36.7$113 million. The change was mainly driven by an unfavorable change in the first three months of 2024 was substantially driven by the higher accounts receivable, partially offset by favorable changesreceivables due to an increase in sales towards the end of the first quarter of 2024 and higher inventory prepaidvolumes at the end of the first quarter of 2024 in the Housing and other current assets and accounts payable.

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Infrastructure segment.
Investing Activities
Net cash used for investing activities duringin the first ninethree months of 20172024 was $459.4$272 million as compared to net cash used for investing activities of $2,389.1$263 million in the first ninethree months of 2016. In2023. The increase in investing activities in the first ninethree months of 2016 we used $2,437.8 million, net2024 as compared to first three months of cash acquired, for2023 was primarily because of capital expenditures in the acquisition of Axiall.period. Capital expenditures were $414.3$272 million in the first ninethree months of 20172024 as compared to $467.3$267 million in the first ninethree months of 2016.2023. Capital expenditures in the first ninethree months of 20172024 and 2023 were primarily incurred on the upgrade and expansion of OpCo's Calvert City ethylene plant at our Calvert City site. Capital expenditures in the first nine months of 2016 were primarily incurred on the upgrade and expansion of OpCo's Petro 1 ethylene unit at our Lake Charles site. The remaining capital expenditures in the first nine months of 2017 and 2016 primarily related to projects to improveincrease production capacity or reduce costs, maintenance and safety projects and environmental projects at our various facilities. In addition, we spent $47.0 million in the nine months of 2017 related to our contribution to Lotte Chemical USA Corporation to fund the construction costs of the ethylene plant. Please see "Liquidity and Capital Resources—Liquidity and Financing Arrangements" below for further discussion. Investing activities in the first nine months of 2016 included purchases of securities totaling $138.4 million. We also received aggregate proceeds of $662.9 million from the sales and maturities of our investments in the first nine months of 2016.
Financing Activities
Net cash used for financing activities during the first ninethree months of 20172024 of $74 million was $306.4 million as comparedcomparable to the net cash provided byused for financing activities of $1,560.5$75 million in the first ninethree months of 2016. We used $150.0 million and $550.0 million, respectively, for the full repayment of our term loan and the partial repayment of the Credit Agreement in the first nine months of 2017. These uses were partially offset by a drawdown under the Credit Agreement of $225.0 million in the first nine months of 2017 and net proceeds of $110.7 million from the issuance of WLKP common units as a result of its secondary offering in September 2017. During the first nine months of 2017, the restriction on $154.0 million of cash was also removed as a result of the repayment of our term loan.2023. The remaining activities during the first ninethree months of 20172024 were primarily related to the $76.5$65 million payment of cash dividends, the $20.8$10 million payment of cash distributions to noncontrolling interests and the $0.4inflows of $7 million payment of debt issuance costs. In addition, we repaid $6.7 million of Huasu's short-term notes payable to banks in connection with the payment of suppliers through letters of credit, partially offset by $5.9 million of proceeds from the issuanceexercise of such notes payable.stock options. The financing activities during the first nine months of 2016 were mainly related to the net proceeds from the issuance of our senior notes and the proceeds from our term loan of $1,428.5 in the aggregate and the drawdown under the Credit Agreement of $600.0 million, partially offset by the $125.0 million partial repayment of the Credit Agreement in the first ninethree months of 2016. The remaining activity during the first nine months of 2016 was2023 were primarily related to the $71.9$47 million payment of cash dividends, the $12.3$10 million payment of cash distributions to noncontrolling interests the $35.2 million payment of debt issuance costs and the $67.4 million of cash used for repurchases of shares of our common stock. In addition, we repaid $10.6 millionstock for an aggregate amount of Huasu's short-term notes payable to banks in connection with the payment$22 million.
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Table of suppliers through letters of credit, partially offset by $5.6 million of proceeds from the issuance of such notes payable in the first nine months of 2016.Contents

LIQUIDITY AND CAPITAL RESOURCES
Liquidity and Financing Arrangements
Our principal sources of liquidity are from cash and cash equivalents, cash from operations, short-term borrowings under the Credit Agreementcredit agreement and our long-term financing.
In November 2014, our Board of Directors authorized a $250.0$250 million sharestock repurchase program (the "2014 Program"). In November 2015, our Board of Directors approved the expansion of the 2014 Program by an additional $150.0$150 million. In August 2018, our Board of Directors approved the further expansion of the existing 2014 Program by an additional $150 million. In August 2022, our Board of Directors approved the further expansion of the existing 2014 Program by an additional $500 million. As of September 30, 2017,March 31, 2024, we had repurchased 4,193,5988,722,550 shares of our common stock for an aggregate purchase price of approximately $228.7$574 million under the 2014 Program. We did not repurchase any common stock under the 2014 Program during the three months ended March 31, 2024. Purchases under the 2014 Program may be made either through the open market or in privately negotiated transactions. Decisions regarding the amount and the timing of purchases under the 2014 Program will be influenced by our cash on hand, our cash flowflows from operations, general market conditions and other factors. The 2014 Program may be discontinued by our Board of Directors at any time.
In connectionOn October 4, 2018, Westlake Chemical Partners LP ("Westlake Partners") and Westlake Chemical Partners GP LLC, the general partner of Westlake Partners, entered into an Equity Distribution Agreement with the Merger, we became partyUBS 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 a joint venture investment with Lotte Chemical USA Corporationoffer and sell Westlake Partners common units, from time to build an ethylene facility, LACC, LLC ("LACC"). The ethylene facility is located adjacent to our vinyls facility in Lake Charles. Pursuant to the contribution and subscription agreement, we agreed to make a maximum capital commitment to LACC oftime, up to $225.0 millionan aggregate offering amount of $50 million. This Equity Distribution Agreement was amended on February 28, 2020 to fund the construction costsreference a new shelf registration and subsequent renewals thereof for utilization under this agreement. No common units have been issued under this program as of the ethylene plant, which represents approximately 10.0% of the interests in LACC. The construction of the ethylene plant commenced in January 2016, with an anticipated start-up in 2019. As of September 30, 2017, we had funded approximately $106.4 million of our portion of the construction costs of the ethylene plant.

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March 31, 2024.
We believe that our sources of liquidity as described above will beare adequate to fund our normal operations and ongoing capital expenditures.expenditures and turnaround activities. Funding of any potential large expansions such as our recent acquisitions or any potential future acquisitions wouldor the redemption of debt may likely necessitate, and therefore depend on, our ability to obtain additional financing in the future. We may not be able to access additional liquidity at cost effectivefavorable interest rates due to the volatility of the commercial credit markets.
Cash and Cash Equivalents
As of September 30, 2017,March 31, 2024, our cash and cash equivalents totaled $678.2$3,108 million.
In addition we have the Credit Agreementto our cash and cash equivalents, our credit agreement is available to supplement cash ifprovide liquidity as needed, as described under "Debt" below.
Debt
As of September 30, 2017,March 31, 2024, the carrying value of our indebtedness including current maturities, totaled $3.3 billion, consisting of $100.0 million of 6 ½% senior notes due 2029, $250.0 million of 6 ¾% senior notes due 2032, $89.0 million of 6 ½% senior notes due 2035 (the "6 ½% 2035 GO Zone Senior Notes"), $65.0 million of 6 ½% senior notes due 2035 (the "6 ½% 2035 IKE Zone Senior Notes") (collectively, the "Senior Notes"), $624.8 million aggregate principal amount of 4.625% senior notes due 2021 (the "4.625% 2021 Senior Notes"), $63.2 million aggregate principal amount of the 4.625% senior notes due 2021 (the "4.625% Subsidiary 2021 Senior Notes"), $250.0 million principal amount of 3.60% senior notes due 2022 (the "3.6% senior notes due 2022"), $433.8 million aggregate principal amount of 4.875% senior notes due 2023 (the "4.875% 2023 Senior Notes"), $16.2 million aggregate principal amount of the 4.875% senior notes due 2023 (the "4.875% Subsidiary 2023 Senior Notes"), $750.0 million aggregate principal amount of 3.60% senior notes due 2026 (the "3.60% 2026 Senior Notes"), $700.0 million aggregate principal amount of 5.0% senior notes due 2046 (the "5.0% 2046 Senior Notes") and a $10.9 million loan from the proceeds of tax-exempt waste disposal revenue bonds (supported by an $11.3 million letter of credit), plus unamortized premium net of unamortized discount and debt issuance costs of $3.5$4,890 million. The 6 ½% senior notes due 2029, the 6 ¾% senior notes due 2032, the 6 ½% 2035 GO Zone Senior Notes and the 6 ½% 2035 IKE Zone Senior Notes evidence and secure our obligationsSee Note 7 to the Louisiana Local Government Environmental Facility and Development Authority (the "Authority"),consolidated financial statements appearing elsewhere in this Form 10-Q for a political subdivisiondiscussion of the State of Louisiana, under four loan agreements relating to the issuance of $100.0 million, $250.0 million, $89.0 million and $65.0 million aggregate principal amount of the Authority's tax-exempt revenue bonds, respectively. As of September 30, 2017, debt outstanding under the tax-exempt waste disposal revenue bonds bore interest at a variable rate. As of September 30, 2017, we were in compliance with all of the covenants with respect to the Senior Notes, the 4,625% 2021 Senior Notes, the 4.625% Subsidiary 2021 Senior Notes, the 3.60% senior notes due 2022, the 4.875% 2023 Senior Notes, the 4.875% Subsidiary 2023 Senior Notes, the 3.60% 2026 Senior Notes, the 5.0% 2046 Senior Notes, the Credit Agreement and our waste disposal revenue bonds.long-term indebtedness.
Our ability to make payments on our indebtedness and to fund planned capital expenditures will depend on our ability to generate cash in the future, which is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control. Based on our current level of operations and unless we were to undertake a new expansion or large acquisition, we believe our cash flowflows from operations, available cash and available borrowings under the Credit Agreementour credit agreement will be adequate to meet our normal operating needs for the foreseeable future.
Term Loan
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On August 10, 2016, our indirect subsidiary, Westlake International Holdings II C.V., a limited partnership organized under the laws
Our long-term debt consisted of the Netherlands (the "CV Borrower"), entered into a credit agreement with Bank of America, N.A.,following as agent and lender, providing the CV Borrower with a $150.0 million term loan facility. The term loan facility had a maturity date of March 31, 2017. The term loan was fully repaid in January 2017. The loans thereunder bore interest2024:
Principal Amount
(in millions of dollars)
Debt Issuance DateMaturity DatePar Call DateOptional Redemption Terms and Other Matters
0.875% senior notes due 2024 (the "0.875% 2024 Senior Notes")$300 August 2021August 2024August 15, 2022(1)
3.60% senior notes due 2026 (the "3.60% 2026 Senior Notes")750 August 2016August 2026May 15, 2026(1) (4)
Loan related to tax-exempt waste disposal revenue bonds due 202711 December 1997December 2027(6)
1.625% €700 million senior notes due 2029 (the "1.625% 2029 Senior Notes")756 July 2019July 2029 April 17, 2029(1) (2)
3.375% senior notes due 2030 (the "3.375% 2030 Senior Notes")300 June 2020June 2030March 15, 2030(1) (3)
3.50% senior notes due 2032 (the "3.50% 2032 tax-exempt GO Zone Refunding Senior Notes")250 November 2017November 2032November 1, 2027 (5)
2.875% senior notes due 2041 (the "2.875% 2041 Senior Notes")350 August 2021August 2041February 15, 2041(1) (3)
5.00% senior notes due 2046 (the "5.00% 2046 Senior Notes")700 August 2016August 2046February 15, 2046(1) (4)
4.375% senior notes due 2047 (the "4.375% 2047 Senior Notes")500 November 2017November 2047May 15, 2047(1) (3)
3.125% senior notes due 2051 (the "3.125% 2051 Senior Notes")600 August 2021August 2051February 15, 2051(1) (3)
3.375% senior notes due 2061 (the "3.375% 2061 Senior Notes")450 August 2021August 2061February 15, 2061(1) (3)
Term loan 2026 (the "2026 Term Loan")12 March 2021March 2026(7)
Total long-term debt$4,979 

(1)    At our option, we may redeem the notes at any time on or after the specified par call date at a floating interest rateredemption price equal to LIBOR100% of the principal amount of the notes being redeemed plus 2.0% per annum, payable in arrearsaccrued and unpaid interest.
(2)    At our option, we may redeem the notes at any time prior to the specified par call date at a redemption price equal to the greater of (i) 100% of the principal amount of the notes being redeemed plus accrued and unpaid interest and (ii) the sum of the present values of the remaining scheduled payments on the last daynotes being redeemed that would be due if the notes matured on the specified par call date (not including any portion of each three-month period followingsuch payments of interest accrued as of the redemption date), discounted to the redemption date on an annual basis at the applicable comparable government bond rate plus 30 basis points plus accrued and unpaid interest.
(3)    At our option, we may redeem the notes at any time prior to the specified par call date at a redemption price equal to the greater of funding(i) 100% of the principal amount of the notes being redeemed plus accrued and unpaid interest and (ii) the sum of the present values of the remaining scheduled payments on the notes being redeemed that would be due if the notes matured on the specified par call date (excluding accrued and unpaid interest to the redemption date), discounted to the redemption date on a semi-annual basis at maturity.the treasury rate plus 20 to 40 basis points plus accrued and unpaid interest.

(4)    At our option, we may redeem the notes at any time prior to the specified par call date at a redemption price equal to the greater of (i) 100% of the principal amount of the notes being redeemed plus accrued and unpaid interest and (ii) the sum of the present values of the remaining scheduled payments on the notes being redeemed (excluding accrued and unpaid interest to the redemption date), discounted to the redemption date on a semi-annual basis at the treasury rate plus 35 to 45 basis points, plus accrued and unpaid interest.
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Credit Agreement
On August 23, 2016,(5)    In the event of a redemption of certain bonds (the "GO Zone Bonds") issued by the Louisiana Local Government Environmental Facility and Development Authority (the "Authority") in 2017, we and certain of our subsidiaries entered into an unsecured revolving credit facility (the "Credit Agreement"), by and among us, the other borrowers and guarantors referred to therein, the lenders from time to time party thereto (collectively, the "Lenders"), the issuing banks party thereto and JPMorgan Chase Bank, National Association, as Administrative Agent. Under the Credit Agreement, the Lenders have committed to provide an unsecured five-year revolving credit facilitywill redeem notes equal in an aggregate principal amount of up to $1.0 billion. The Credit Agreement replaced our $400.0 million senior secured third amended and restated credit facility, dated as of July 17, 2014 (the "Prior ABL Credit Agreement"), by and among us, the financial institutions party thereto, as lenders, Bank of America, N.A., as agent, and us and certain of our subsidiaries, as borrowers. The Credit Agreement includes a $150.0 million 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 $50.0 million commitment for swing-line loans to be provided on a same-day basis. We may also increase the size of the facility, in increments of at least $25.0 million, up to a maximum of $500.0 million, subject to certain conditions and if certain Lenders agree to commit to such an increase. On October 14, 2016, certain domestic subsidiaries of Axiall and Lagoon LLC were added as subsidiary guarantors to the Credit Agreement.
At September 30, 2017, we had no borrowings outstanding under the Credit Agreement. Borrowings under the Credit Agreement will bear interest, at our option, at either (a) LIBOR plus a spread ranging from 1.0% to 1.75% that will vary depending on our credit rating or (b) Alternate Base Rate plus a spread ranging from 0.0% to 0.75% that will vary depending on our credit rating. The Credit Agreement also requires an undrawn commitment fee ranging from 0.10% to 0.25% that will vary depending on our credit rating. The Credit Agreement matures on August 23, 2021. As of September 30, 2017, we had outstanding letters of credit totaling $45.4 million and borrowing availability of $954.6 million under the Credit Agreement.
Our obligations under the Credit Agreement are guaranteed by our current and future material domestic subsidiaries, subject to customary exceptions. The Credit Agreement contains customary affirmative and negative covenants, including a quarterly total leverage ratio financial maintenance covenant. The Credit Agreement also contains customary events of default and if and for so long as an event of default has occurred and is continuing, any 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. As of September 30, 2017, we were in compliance with the total leverage ratio financial maintenance covenant.
GO Zone and IKE Zone Bonds
As of September 30, 2017, we had drawn all the proceeds from the issuance of the 6 ½% senior notes due 2029, 6 ¾% senior notes due 2032, 6 ½% 2035 GO Zone Senior Notes and 6 ½% 2035 IKE Zone Senior Notes. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Debt" in the 2016 Form 10-K and below for more information on the 6 ½% senior notes due 2029, the 6 ¾% senior notes due 2032, the 6 ½% 2035 GO Zone Senior Notes and the 6 ½% 2035 IKE Zone Senior Notes. All domestic restricted subsidiaries that guarantee other debt of ours or of another guarantor of the Senior Notes in excess of $5.0 million are guarantors of these notes.
The $250.0 million of 6 ¾% senior notes due November 1, 2032 under the GO Zone Act was issued byBonds to be redeemed at a redemption price equal to the Authority in December 2007.redemption price of the GO Zone Bonds to be redeemed, plus accrued interest to the redemption date. The bonds wereGO Zone Bonds are subject to optional redemption by the Authority upon the direction of the Company at any time on or after November 1, 20172027, for 100.0%100% of the principal amount plus accrued interest. During September 2017, we directed the Authority to optionally redeem in full $250.0 million 6 ¾% senior notes on November 1, 2017 at a redemption price of par, plus accrued and unpaid interest if any, to the redemption date. The Authority is required to cause the GO Zone Bonds trustee to surrender the 6 ¾% senior notes due November 2032 of $250.0 million, to the Senior Notes trustee for cancellation. We used cash on hand to fund the redemption of the GO Zone Bonds.

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The indentures governing the Senior Notes contain customary covenants and events of default. Accordingly, these agreements generally impose significant operating and financial restrictions on us. These restrictions, among other things, provide limitations on incurrence of additional indebtedness, the payment of dividends, certain investments and acquisitions and sales of assets. However, the effectiveness of certain of these restrictions is currently suspended because the Senior Notes are currently rated investment grade by at least two nationally recognized credit rating agencies. The most significant of these provisions, if it were currently effective, would restrict us from incurring additional debt, except specified permitted debt (including borrowings under our credit facility), when our fixed charge coverage ratio is below 2.0:1. These limitations are subject to a number of important qualifications and exceptions, including, without limitation, an exception for the payment of our regular quarterly dividend of up to $0.10 per share. If the restrictions were currently effective, distributions in excess of $100.0 million would not be allowed unless, after giving pro forma effect to the distribution, our fixed charge coverage ratio is at least 2.0:1 and such payment, together with the aggregate amount of all other distributions after January 13, 2006, is less than the sum of 50.0% of our consolidated net income for the period from October 1, 2003 to the end of the most recent quarter for which consolidated financial statements have been filed, plus 100.0% of net cash proceeds received after October 1, 2003 as a contribution to our common equity capital or from the issuance or sale of certain securities, plus several other adjustments.
3.60% Senior Notes due 2022
The 3.60% senior notes due 2022 are unsecured and were issued with an original issue discount of $1.2 million. There is no sinking fund and no scheduled amortization of the 3.60% senior notes due 2022 prior to maturity. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Debt" in the 2016 Form 10-K for more information on the 3.60% senior notes due 2022. All of our domestic subsidiaries that guarantee other indebtedness of ours or of another guarantor of the 3.60% senior notes due 2022 in excess of $5.0 million are guarantors of the 3.60% senior notes due 2022.
The indenture governing the 3.60% senior notes due 2022 contains customary events of default and covenants that will restrict our and certain of our subsidiaries' ability to (1) incur certain secured indebtedness, (2) engage in certain sale-leaseback transactions and (3) consolidate, merge or transfer all or substantially all of our or their assets.
3.60% Senior Notes due 2026 and 5.0% Senior Notes due 2046
In August 2016, we issued $750.0 million aggregate principal amount of the 3.60% 2026 Senior Notes and $700.0 million aggregate principal amount of the 5.0% 2046 Senior Notes. In connection with the private offering and issuance of the 3.60% 2026 Senior Notes and the 5.0% 2046 Senior Notes, we entered into a registration rights agreement pursuant to which, among other things, we agreed to file with the SEC a registration statement relating to an offer to exchange the 3.60% 2026 Senior Notes and the 5.0% 2046 Senior Notes for the 2026 and 2046 Exchange Notes containing terms substantially identical to the 3.60% 2026 Senior Notes and the 5.0% 2046 Senior Notes (except that the transfer restrictions on the 2026 and 2046 Exchange Notes will be modified or eliminated and there will be no registration rights). On March 27, 2017, we commenced registered exchange offers to exchange the 3.60% 2026 Senior Notes and the 5.0% 2046 Senior Notes for new notes that are identical in all material respects to the 3.60% 2026 Senior Notes and the 5.0% 2046 Senior Notes, except that the offer and issuance of the new notes have been registered under the Securities Act. The exchange offers expired on April 24, 2017, and approximately 99.97% of the 3.60% 2026 Senior Notes and 100.00% of the 5.0% 2046 Senior Notes were exchanged. The 3.60% 2026 Senior Notes that were not exchanged pursuant to the exchange offers have not been registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements or a transaction not subject to the registration requirements of the Securities Act or any state securities law.
All of our domestic subsidiaries that guarantee other indebtedness of ours or of another guarantor of the 3.60% 2026 Senior Notes or the 5.0% 2046 Senior Notes in excess of $40.0 million are guarantors of the 3.60% 2026 Senior Notes and the 5.0% 2046 Senior Notes. The indenture governing the 3.60% 2026 Senior Notes and the 5.0% 2046 Senior Notes contains customary events of default and covenants that will restrict our and certain of our subsidiaries' ability to (1) incur certain secured indebtedness, (2) engage in certain sale-leaseback transactions and (3) consolidate, merge or transfer all or substantially all of our or their assets. References to the 3.60% 2026 Senior Notes and the 5.0% 2046 Senior Notes in this paragraph refer to the 3.60% 2026 Senior Notes and the 5.0% 2046 Senior Notes that were exchanged in the exchange offers described in the preceding paragraph as well as the 3.60% 2026 Senior Notes that were not exchanged in such exchange offers.

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4.625% Senior Notes due 2021 and 4.875% Senior Notes due 2023
In September 2016, we issued $624.8 million aggregate principal amount of the 4.625% 2021 Senior Notes and $433.8 million aggregate principal amount of the 4.875% 2023 Senior Notes upon the closing of our offers to exchange any and all of the $688.0 million aggregate principal amount of the outstanding 4.625% senior notes due 2021 issued by Eagle Spinco Inc., a wholly owned subsidiary of Axiall, and the $450.0 million aggregate principal amount of the outstanding 4.875% senior notes due 2023 issued by Axiall. In connection with the private offering and issuance of the 4.625% 2021 Senior Notes and the 4.875% Senior Notes, we entered into a registration rights agreement pursuant to which, among other things, we agreed to file with the SEC a registration statement relating to an offer to exchange the 4.625% 2021 Senior Notes and the 4.875% 2023 Senior Notes for new SEC registered notes (the "2021 and 2023 Exchange Notes") containing terms substantially identical to the 4.625% 2021 Senior Notes and the 4.875% 2023 Senior Notes except that the transfer restrictions on the 2021 and 2023 Exchange Notes will be modified or eliminated and there will be no registration rights). On March 27, 2017, we commenced registered exchange offers to exchange the 4.625% 2021 Senior Notes and the 4.875% 2023 Senior Notes for new notes that are identical in all material respects to the 4.625% 2021 Senior Notes and the 4.875% 2023 Senior Notes, except that the offer and issuance of the new notes have been registered under the Securities Act. The exchange offers expired on April 24, 2017, and 100.0% of the 4.625% 2021 Senior Notes and 100.0% of the 4.875% 2023 Senior Notes were exchanged.
All of our domestic subsidiaries that guarantee other indebtedness of ours or of another guarantor of the 4.625% 2021 Senior Notes or the 4.875% 2023 Senior Notes in excess of $40.0 million are guarantors of the 4.625% 2021 Senior Notes and the 4.875% 2023 Senior Notes. The indenture governing the 4.625% 2021 Senior Notes and the 4.875% 2023 Senior Notes contains customary events of default and covenants that will restrict our and certain of our subsidiaries' ability to (1) incur certain secured indebtedness, (2) engage in certain sale-leaseback transactions and (3) consolidate, merge or transfer all or substantially all of our or their assets. References to the 4.625% 2021 Senior Notes and the 4.875% 2023 Senior Notes in this paragraph refer to the 4.625% 2021 Senior Notes and the 4.875% 2023 Senior Notes that were exchanged in the exchange offers described in the preceding paragraph.
Revenue Bonds
In December 1997, we entered into a loan agreement with a public trust established for public purposes for the benefit of the Parish of Calcasieu, Louisiana. The public trust issued $10.9 million principal amount of tax-exempt waste disposal revenue bonds in order to finance our construction of waste disposal facilities for an ethylene plant.(6)    The waste disposal revenue bonds expire in December 2027 and are subject to redemption and mandatory tender for purchase prior to maturity under certain conditions. Interest on the waste disposal revenue bonds accrues at a rate determined by a remarketing agent and is payable quarterly. The interest rate on the waste disposal revenue bonds at March 31, 2024 was 3.65%.
(7)    The 2026 Term Loan has a 5-year maturity and includes a government rate subsidy. The interest rate on the 2026 Term Loan as of March 31, 2024 was 0.95%.
The holders of the 0.875% 2024 Senior Notes, the 3.60% 2026 Senior Notes, the 1.625% 2029 Senior Notes, the 3.375% 2030 Senior Notes, the 3.50% 2032 tax-exempt GO Zone Refunding Senior Notes, the 2.875% 2041 Senior Notes, the 5.00% 2046 Senior Notes, the 4.375% 2047 Senior Notes, the 3.125% 2051 Senior Notes and the 3.375% 2061 Senior Notes may require us to repurchase the notes at a price equal to 101% of their principal amount, plus accrued and unpaid interest to, but not including, the date of repurchase, upon the occurrence of both a "change of control" and, within 60 days of such change of control, a "below investment grade rating event" (as such terms are defined in the respective indentures governing these notes).
The indenture governing the 0.875% 2024 Senior Notes, the 3.60% 2026 Senior Notes, the 1.625% 2029 Senior Notes, the 3.375% 2030 Senior Notes, the 3.50% 2032 tax-exempt GO Zone Refunding Senior Notes, the 2.875% 2041 Senior Notes, the 5.00% 2046 Senior Notes, the 4.375% 2047 Senior Notes, the 3.125% 2051 Senior Notes, and the 3.375% 2061 Senior Notes contains customary events of default and covenants that, among other things and subject to certain exceptions, restrict us and certain of our subsidiaries' ability to (1) incur certain secured indebtedness, (2) engage in certain sale and leaseback transactions and (3) consolidate, merge or transfer all or substantially all of our assets.
As of March 31, 2024, we were in compliance with all of our long-term debt covenants.
Credit Agreement
On June 9, 2022, we entered into a new $1.5 billion revolving credit facility that is scheduled to mature on June 9, 2027 (the "Credit Agreement") and, in connection therewith, terminated our then existing revolving credit agreement. The Credit Agreement bears interest at either (a) Adjusted Term SOFR (as defined in the Credit Agreement) plus a margin ranging from 1.00% to 1.625% per annum or (b) Alternate Base Rate (as defined in the Credit Agreement) plus a margin ranging from 0.00% to 0.625% per annum, in each case depending on the credit rating of the Company. The Credit Agreement contains certain affirmative and negative covenants, including a quarterly total leverage ratio financial maintenance covenant. As of March 31, 2024, we were 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 to lend thereunder and payments of any outstanding amounts thereunder could be accelerated by the lenders. None of our subsidiaries are required to guarantee our obligations under the Credit Agreement.
The Credit Agreement includes a $150 million 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 million commitment for swingline loans to be provided on a same-day basis. We may also increase the size of the facility, in increments of at least $25 million, up to a maximum of $500 million, subject to certain conditions and if certain lenders agree to commit to such an increase.
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Westlake Chemical Partners LP Credit Arrangements
Our subsidiary, Westlake Chemical Finance Corporation, is the lender party to a $300.0$600 million revolving credit facility with Westlake Chemical Partners LP ("WLKP"Westlake Partners"). On August 1, 2017, the revolving credit facility was amended (the "MLP Revolver") that is scheduled to extend the maturity from 2018 to 2021. Borrowings under the revolver bear interest at LIBOR plus a spread ranging from 2.0% to 3.0% (dependingmature on WLKP's consolidated leverage ratio), payable quarterly. WLKP may pay all or a portion of the interest on any borrowings in kind, in which case any such amounts would be added to the principal amount of the loan.July 12, 2027. As of September 30, 2017,March 31, 2024, outstanding borrowings under the credit facility totaled $253.5$377 million and bore interest at Secured Overnight Financing Rate, as administered by the Federal Reserve Bank of New York ("SOFR") plus the Applicable Margin plus a 0.10% credit spread adjustment. On July 12, 2022, Westlake Partners entered into the Fourth Amendment (the "MLP Revolver Amendment") to the MLP Revolver. The MLP Revolver Amendment, among other things, extended the maturity date to July 12, 2027 and provided for the replacement of LIBOR with SOFR. Borrowings under the MLP Revolver now bear interest at a variable rate of either (a) SOFR plus 2.0%the Applicable Margin plus a 0.10% credit spread adjustment or, if SOFR is no longer available, (b) the Alternate Base Rate plus the Applicable Margin minus 1.0%. The Applicable Margin under the MLP Revolver varies between 1.75% and 2.75%, depending on the Partnership's Consolidated Leverage Ratio.
Our subsidiary, Westlake Development Corporation,Polymers LLC, is the lender partyadministrative agent to a $600.0$600 million revolving credit facility with OpCo. The revolving credit facility matures in 2019. Westlake Chemical OpCo LP ("OpCo") (the "OpCo Revolver") that is scheduled to mature on July 12, 2027. As of September 30, 2017, March 31, 2024, outstanding borrowings under the credit facility totaled $223.6$23 million and bore interest at SOFR plus the Applicable Margin of 1.75% plus a 0.10% credit spread adjustment. On July 12, 2022, OpCo entered into the Second Amendment (the "OpCo Revolver Amendment") to the OpCo Revolver. The OpCo Revolver Amendment, among other things, extended the maturity date to July 12, 2027 and provided for the replacement of LIBOR with SOFR. Borrowings under the OpCo Revolver now bear interest at a variable rate of either (a) SOFR plus 3.0%, whichthe Applicable Margin plus a 0.10% credit spread adjustment or, if SOFR is accrued in arrears quarterly.no longer available, (b) the Alternate Base Rate plus the Applicable Margin minus 1.0%. The Applicable Margin under the OpCo Revolver is 1.75%.
We consolidate WLKPWestlake Partners and OpCo for financial reporting purposes as we have a controlling financial interest. As such, the revolving credit facilities described above between our subsidiaries and WLKPWestlake Partners and OpCo are eliminated from the financial statements upon consolidation.
Off-Balance Sheet Arrangements
None.

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FORWARD-LOOKING STATEMENTS
The Private Securities Litigation Reform Act of 1995 provides safe harbor provisions for forward-looking information. Certain of the statements contained in this report are forward-looking statements. All statements, other than statements of historical facts, included in this report that address activities, events or developments that we expect, project, believe or anticipate will or may occur in the future are forward-looking statements. Forward-looking statements can be identified by the use of words such as "believes," "intends," "may," "should," "could," "anticipates," "expected" or comparable terminology, or by discussions of strategies or trends. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we cannot give any assurances that these expectations will prove to be correct. Forward-looking statements relate to matters such as:
•the ultimate timing, outcome and results of integrating the operations of acquisitions and the ultimate outcome of our operating efficiencies applied to the products and services; the effects of the acquisition, including the combined company's future financial condition, results of operations, strategy and plans; and expected synergies and other benefits from the acquisition and our ability to realize such synergies and other benefits;
•future operating rates, margins, cash flows and demand for our products (including any changes as a result of economic growth or North American producers' competitive position);products;
•industry market outlook, including the price of crude oil;oil, natural gas, ethane, housing starts and repair and remodeling activity;
•macroeconomic outlook, including rising interest rates, inflation and possible recession;
•widespread outbreak of an illness or any other communicable disease, or any other public health crisis;
•production capacities;
•the impact of uncertainties and ongoing supply chain constraints caused by the Panama Canal reduced transit capacity and conflicts in the Middle East and between Russia and Ukraine;
•currency devaluation;
•our ability to borrow additional funds under the Credit Agreement;our credit agreement;
•our ability to meet our liquidity needs;
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•our ability to meet debt obligations under our debt instruments;
•our intended quarterly dividends;
•future capacity additions and expansions in the industry;industries in which we compete;
•results of acquisitions;
•timing, funding and results of capital projects, such as the construction of the LACC plant and associated facilities;projects;
results of acquisitions, including our acquisition of Axiall (including the benefits, results and effects thereof);
•pension plan obligations, funding requirements and investment policies;
•compliance with present and future environmental regulations and costs associated with environmentally related penalties, capital expenditures, remedial actions and proceedings, including any new laws, regulations or treaties that may come into force to limit or control carbon dioxide and other greenhouse gasesgas emissions or to address other issues of climate change;
•recovery of losses under our insurance policies;
•effects of pending legal proceedings;proceedings and settlements; and
•timing of and amount of capital expenditures.
We have based these statements on assumptions and analyses in light of our experience and perception of historical trends, current conditions, expected future developments and other factors we believe were appropriate in the circumstances when the statements were made. Forward-looking statements by their nature involve substantial risks and uncertainties that could significantly impact expected results, and actual future results could differ materially from those described in such statements. While it is not possible to identify all factors, we continue to face many risks and uncertainties. Among the factors that could cause actual future results to differ materially are the risks and uncertainties discussed under "Risk Factors" in the 20162023 Form 10-K and those described from time to time in our other filings with the SEC including, but not limited to, the following:
•general economic and business conditions;conditions, including inflation, interest rates and possible recession;
•the cyclical nature of the chemical industry;and building products industries;
•the availability, cost and volatility of raw materials and energy;
•uncertainties associated with the United States, European and worldwide economies, including those due to political tensions and unrestconflict in the Middle East, the Commonwealth of Independent States (including Ukraine)Russia and Ukraine and elsewhere;
•uncertainties associated with pandemic infectious diseases;
•uncertainties associated with climate change;
•the potential impact on demand for ethylene, polyethylene and polyvinyl chloride due to initiatives such as recycling and customers seeking alternatives to polymers;
•current and potential governmental regulatory actions in the United States and other countries and political unrest in other areas;countries;
•industry production capacity and operating rates;
•the supply/demand balance for our products;
•competitive products and pricing pressures;

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•instability in the credit and financial markets;
•access to capital markets;
•terrorist acts;
•operating interruptions (including leaks, explosions, fires, weather-related incidents, mechanical failure, unscheduled downtime, labor difficulties, transportation interruptions, spills and releases and other environmental risks);
•changes in laws or regulations;regulations, including trade policies;
•technological developments;
our ability to realize anticipated benefits of the Merger•information systems failures and to integrate Axiall's business;cyberattacks;
charges or other liabilities relating to the Merger;
the significant indebtedness that we have incurred in connection with the Merger;
our ability to integrate acquired businesses other than Axiall;
•foreign currency exchange risks;
•our ability to implement our business strategies; and
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•creditworthiness of our customers.
Many of such factors are beyond our ability to control or predict. Any of the factors, or a combination of these factors, could materially affect our future results of operations and the ultimate accuracy of the forward-looking statements. These forward-looking statements are not guarantees of our future performance, and our actual results and future developments may differ materially from those projected in the forward-looking statements. Management cautions against putting undue reliance on forward-looking statements or projecting any future results based on such statements or present or prior earnings levels. Every forward-looking statement speaks only as of the date of the particular statement, and we undertake no obligation to publicly update or revise any forward-looking statements.
Item 3.Quantitative and Qualitative Disclosures about Market Risk
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Commodity Price Risk
A substantial portion of our products and raw materials are commodities whose prices fluctuate as market supply and demand fundamentals change. Accordingly, product margins and the level of our profitability tend to fluctuate with changes in the business cycle. We try to protect against such instability through various business strategies. Our strategies include ethylene product feedstock flexibility and moving downstream into the olefins and vinylsour other products where pricing is more stable. We use derivative instruments (including commodity swaps and options) in certain instances to reduce price volatility risk on feedstocks and products. Based on our open derivative positions at September 30, 2017,March 31, 2024, a hypothetical $0.10 increase in the price of a gallon of ethane would have increased our income before taxes by $6.9 million and a hypothetical $0.10 increase in the price of a gallonmillion British thermal units of propanenatural gas would not have increaseda material impact on our income before taxes by $3.8 million. Additional information concerning derivative commodity instruments appears in Notes 13 and 14 to the unaudited consolidated financial statements within this Quarterly Report on Form 10-Q.income taxes.
Interest Rate Risk
We are exposed to interest rate risk with respect to fixed and variable rate debt. At September 30, 2017,March 31, 2024, we had $10.9$4,956 million principal amount of variable rate debt outstanding. The debt outstanding under the tax-exempt waste disposal revenue bonds is at a variable rate. We do not currently hedge our variable interest rate debt, but we may do so in the future. The average variable interest rate for our variable rate debt of $10.9 million as of September 30, 2017 was 1.0%. A hypothetical 100 basis point increase in the average interest rate on our variable rate debt would increase our annual interest expense by approximately $0.1 million. Also, at September 30, 2017, we had $3.3 billion aggregate principal amount of fixed rate debt. We are subject to the risk of higher interest cost if and when this debt is refinanced. If interest rates were 1.0% higher at the time of refinancing, our annual interest expense would increase by approximately $33.4$50 million. Also, at March 31, 2024, we had $23 million principal amount of variable rate debt outstanding, which represents the term loans due 2026 and the tax-exempt waste disposal revenue bonds due 2027. We do not currently hedge our variable interest rate debt, but we may do so in the future. The weighted average variable interest rate for our variable rate debt of $23 million as of March 31, 2024 was 2.26%. A hypothetical 100 basis point increase in the average interest rate on our variable rate debt would not result in a material change in the interest expense.
SOFR is used as a reference rate for borrowings under our revolving line of credit. We did not have any SOFR-based borrowings outstanding at March 31, 2024.
Foreign Currency Exchange Rate Risk
We are exposed to foreign currency exchange rate risk associated with our international operations. However, the effect of fluctuations in foreign currency exchange rates caused by our international operations has not had a material impact on our overall operating results. We may engage in activities to mitigate our exposure to foreign currency exchange risk in certain instances through the use of currency exchange derivative instruments, including forward exchange contracts, cross-currency swaps or spot purchases. A forward exchange contract obligates us to exchange predetermined amounts of specified currencies at a stated

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exchange rate on a stated date. A cross-currency swap obligates us to make periodic payments in the local currency and receive periodic payments in our functional currency based on the notional amount of the instrument. In January 2018, we entered into foreign exchange hedging contracts designated as net investment hedges with an aggregate notional value of €220 million designed to reduce the volatility in stockholders' equity from changes in currency exchange rates associated with our net investments in foreign operations. In July 2019, we terminated a portion of the foreign exchange hedging contract with a notional value of €70 million. The notional value of the remaining net investment hedges was €150 million at March 31, 2024. The arrangement is scheduled to settle in 2026.


In July 2019, we completed the registered public offering of €700 million aggregate principal amount of the 1.625% 2029 Senior Notes. We designated this euro-denominated debt as a non-derivative net investment hedge of a portion of our net investments in euro functional-currency denominated subsidiaries to offset foreign currency fluctuations.
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Item 4.Controls and Procedures
Item 4. Controls and Procedures
We carried out an evaluation, under the supervision and with the participation of our management, including our President and Chief Executive Officer and our Executive Vice President and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures pursuant to Rules 13a-15 or 15d-15 under the Securities Exchange Act of 1934 as of the end of the period covered by this report. Based upon that evaluation, our President and Chief Executive Officer and our Executive Vice President and Chief Financial Officer concluded that our disclosure controls and procedures are effective with respect to (i) the accumulation and communication to our management, including our Chief Executive Officer and our Chief Financial Officer, of information required to be disclosed by us in the reports that we submit under the Exchange Act, and (ii) the recording, processing, summarizing and reporting of such information within the time periods specified in the SEC's rules and forms.
There were no changes in our internal control over financial reporting that occurred during the three months ended September 30, 2017March 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


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PART II. OTHER INFORMATION
Item 1.
Item 1. Legal Proceedings
The 20162023 Form 10-K, filed on February 22, 2017,2024, contained a description of various legal proceedings in which we are involved. See Note 1813 to the unaudited consolidated financial statements within this Quarterly Report on Form 10-Q for aan updated description of certain of those proceedings, which information is incorporated by reference herein.
From time to time, we receive notices or inquiries from government entities regarding alleged violations of environmental laws and regulations pertaining to, among other things, the disposal, emission and storage of chemical substances, including hazardous wastes. For a description of certain environmental matters involving a governmental authority as a party to the proceedings and potential monetary sanctions that we believe could exceed $1 million (which is less than one percent of our current assets on a consolidated basis as of March 31, 2024), please see the 2023 Form 10-K and Note 13 to the unaudited consolidated financial statements within this Quarterly Report on Form 10-Q, in addition to the following:
•To resolve alleged violations associated with exceedances of discharge limits under the Natrium facility's National Pollutant Discharge Elimination System ("NPDES") permit, effective August 2020, we have entered into enforcement negotiations with the West Virginia Department of Environmental Protection ("WVDEP"). The resolution of this matter may involve a penalty in excess of $1 million.
•In September 2019, U.S. EPA Region 6 issued a Notice of Violation alleging certain violations of the Clean Air Act following an inspection of the Lake Charles North facility in 2019 by the National Enforcement Investigation Center. We now reasonably believe that the resolution of this matter may involve a penalty in excess of $1 million.
In addition to the matters described above, we are also involved in other legal proceedings incidental to the conduct of our business. From time to time, we receive notices or inquiries from government entities regarding alleged violations of environmental laws and regulations pertaining to, among other things, the disposal, emission and storage of chemical substances, including hazardous wastes. We do not believe that any of these legal proceedings will have a material adverse effect on our financial condition, results of operations or cash flows.
Item 1A.
Item 1A. Risk Factors
For a discussion of risk factors, please read Item 1A, "Risk Factors" in the 20162023 Form 10-K. There have been no material changesThe risks described in the report and other documents that we file from those risk factors.
time to time with the Securities and Exchange Commission could materially and adversely affect our business, results of operations, cash flow, liquidity or financial condition.
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Item 2.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
The following table provides information on our purchasepurchases of equity securitiesour common stock during the quarter ended September 30, 2017.March 31, 2024.
Period 
Total Number
of Shares
Purchased (1)
 
Average Price
Paid Per
Share
 
Total Number
of Shares
Purchased as Part
of Publicly
Announced Plans
or Programs (2)
 
Maximum Number
(or Approximate
Dollar Value) of
Shares that
May Yet Be
Purchased Under the
Plans or Programs (2)
July 2017 —
 $—
 —
 $171,285,000
August 2017 —
 $—
 —
 $171,285,000
September 2017 1,142
 $77.67
 —
 $171,285,000
  1,142
 $77.67
 —
  
Period
Total Number
of Shares
Purchased (1)
Average Price
Paid Per
Share
Total Number
of Shares
Purchased as Part
of Publicly
Announced Plans
or Programs (2)
Maximum Number
(or Approximate
Dollar Value) of
Shares that
May Yet Be
Purchased Under the
Plans or Programs (2)
January 2024— $— — $476,162,426 
February 2024102,796 130.67 — 476,162,426 
March 20241,272 151.27 — 476,162,426 
104,068 $130.92 — 
_____________
(1)Represents
(1)    Includes 102,796 and 1,272 shares withheld in February 2024 and March 2024, respectively, in satisfaction of withholding taxes due upon the vesting of restricted stock units granted to our employees under the 2013 Omnibus Incentive Plan.
(2)In November 2014, our Board of Directors authorized a $250.0 million share repurchase program (the "2014 Program"). In November 2015, our Board of Directors approved the expansion of the 2014 Program by an additional $150.0 million. As of September 30, 2017, 4,193,598 shares of common stock had been acquired at an aggregate purchase price of approximately $228.7 million under the 2014 Program. Transaction fees and commissions are not reported in the average price paid per share in the table above. Decisions regarding the amount and the timing of purchases under the 2014 Program will be influenced by our cash on hand, our cash flow from operations, general market conditions and other factors. The 2014 Program may be discontinued by our Board of Directors at any time.

(2)    In November 2014, our Board of Directors authorized a $250 million stock repurchase program (the "2014 Program"). In November 2015, our Board of Directors approved the expansion of the 2014 Program by an additional $150 million. In August 2018, our Board of Directors approved the further expansion of the existing 2014 Program by an additional $150 million. In August 2022, our Board of Directors approved the further expansion of the existing 2014 Program by an additional $500 million. As of March 31, 2024, 8,722,550 shares of our common stock had been acquired at an aggregate purchase price of approximately $574 millionunder the 2014 Program. Transaction fees and commissions are not reported in the average price paid per share in the table above. Decisions regarding the amount and the timing of purchases under the 2014 Program will be influenced by our cash on hand, our cash flows from operations, general market conditions and other factors. The 2014 Program may be discontinued by our Board of Directors at any time.
Item 5. Other Information
Rule 10b5-1 Trading Arrangements. During the three months ended March 31, 2024, no director or officer of the Company adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408 of Regulation S-K.
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Item 6.
Item 6. Exhibits
Exhibit No.Exhibit Index
Exhibit No.
EXHIBIT INDEX

3.1
10.1†
Investment Management Agreement among Westlake Chemical Corporation, Westlake Chemical OpCo LP and Westlake Chemical Partners LP, dated as of August 1, 2017

31.1†
3.2
31.1†
31.2†
32.1#
101.INS†Inline XBRL Instance Document - The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH†Inline XBRL Taxonomy Extension Schema Document
101.CAL†Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF†Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB†Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE†Inline XBRL Taxonomy Extension Presentation Linkbase Document
104Cover Page Interactive Data File - The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document and contained in Exhibit 101


†
†    Filed herewith.
#Furnished herewith.


#    Furnished herewith.

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.




WESTLAKE CORPORATION
Date:May 2, 2024By:WESTLAKE CHEMICAL CORPORATION
Date:November 7, 2017By:
/S/    ALBERT CHAO        
Albert Chao
President and Chief Executive Officer

(Principal Executive Officer)
Date:May 2, 2024By:
/S/    M. STEVEN BENDER        
Date:November 7, 2017By:
/S/    M. STEVEN BENDER        
M. Steven Bender
Executive Vice President and Chief Financial Officer

(Principal Financial Officer)


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