Axiall Corporation (NYSE: AXLL) today announced that the damage from the December 20 fire at its PHH vinyl chloride monomer manufacturing facility at the company’s chemicals complex in Lake Charles, Louisiana, has been repaired and the facility has resumed operations. The facility is expected to reach full operating rates in May.
On February 19, the company described its expectation that the first quarter would be impacted by three significant headwinds: the PHH incident, severe winter weather and a sequential increase to normal maintenance spending.
“The severe weather in the first quarter caused a spike in natural gas prices in line with our expectations, but the unfavorable impact of severe weather on operating rates and sales exceeded our initial estimates,” President and CEO Paul Carrico said today. “During this period of lower production and sales, we increased maintenance spending by an additional approximately $10 million compared to what we described February 19 th to prepare our plants to run at high operating rates for the remainder of the year.”
Based on these factors, the company expects to report $65-70 million of Adjusted EBITDA for the first quarter of 2014.“Long-term, we remain confident that our integrated chemicals and building products business will continue to benefit from low-cost natural gas in North America and growing global demand for our broadened product portfolio,” Carrico said. About Axiall Axiall Corporation is a leading integrated chemicals and building products company. Axiall, headquartered in Atlanta, Georgia, has manufacturing facilities located throughout North America and in Asia to provide industry-leading materials and services to customers. For more information, visit www.axiall.com. Cautionary Statements About Forward-Looking Information This press release contains certain statements relating to future events and our intentions, beliefs, expectations, and predictions for the future. Any such statements other than statements of historical fact are forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Words or phrases such as “anticipate,” “believe,” “plan,” “estimate,” “project,” “may,” “will,” “intend,” “target,” “expect,” “would” or “could” (including the negative variations thereof) or similar terminology used in connection with any discussion of future plans, actions or events generally identify forward-looking statements. These statements relate to, among other things, our expectations regarding: (i) the timing of when our PHH vinyl chloride monomer (“VCM”) manufacturing facility at our chemicals complex in Lake Charles, Louisiana will reach full operating rates; (ii) the impact of recent maintenance spending on the operating rates at our plants for the remainder of 2014; (iii) our estimates regarding our financial performance for the quarter ended March 31, 2014, and our future financial performance; (iv) the cost advantage of natural gas in North America and the degree, and duration of, any such cost advantage; (v) global demand for our products; and (vi) other statements of expectations concerning matters that are not historical facts. These statements are based on the current expectations of our management. There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements included in this press release. These risks and uncertainties include, among other things: (i) our PHH VCM manufacturing facility not reaching full capacity within the currently anticipated time frame; (ii) the recent maintenance spending on our plants not having the favorable impact on the plants’ operating rates that we currently expect, or on the currently anticipated time frame; (iii) a material adverse change, event or occurrence affecting Axiall or the newly acquired chemicals business; (iv) the ability of Axiall to successfully integrate the businesses of the chemicals business formerly owned by PPG with which Axiall has merged (the “Merger”), which may result in the combined company not operating as effectively and efficiently as expected; (v) the possibility that the Merger and related transactions may involve other unexpected costs, liabilities or delays; (vi) uncertainties regarding future prices, industry capacity levels and demand for Axiall’s products, raw materials and energy costs and availability, feedstock availability and prices, changes in governmental and environmental regulations, the adoption of new laws or regulations that may make it more difficult or expensive to operate Axiall’s businesses or manufacture its products, Axiall’s ability to generate sufficient cash flows from its business after the Merger, future economic conditions in the specific industries to which its products are sold, and global economic conditions.