Revenue Analysis:
Total and Operating Revenue: WLK’s total revenue shows a fluctuation over the periods. In 2023-09-30, the total revenue peaked at $3,115,000,000 but decreased to $2,826,000,000 by 2023-12-31 before recovering to $2,975,000,000 by 2024-03-31. This suggests variability in market demand or price levels for WLK’s products or services.
Gross Profit Margins: Gross profit followed a similar trend, peaking at $792,000,000 in 2023-03-31 and dropping significantly to $199,000,000 in 2023-12-31 before rising again to $466,000,000 in 2024-03-31. The gross profit margin displays volatility, indicating potential changes in cost of sales or sales mix.
Cost Management:
Cost of Revenue: The cost of revenue was highest at $2,625,000,000 and $2,550,000,000 during 2023-06-30 and 2023-09-30 respectively showing a slight decrease thereafter. High cost of revenue relative to total revenue highlights potential inefficiencies or rising input costs.
Operating Expense: Operating expenses varied, with a high of $254,000,000 reported in 2023-12-31. This decrease in cost in 2024-03-31 ($239,000,000) suggests improved cost management.
Total Expenses: Total expenses peaked at $2,852,000,000 by 2023-06-30 and then saw a reduction to $2,748,000,000 by 2024-03-31, suggesting an overall effort toward cost containment.
Profitability Analysis:
EBITDA: EBITDA rebounded from a low of -$235,000,000 in 2023-12-31 to $546,000,000 by 2024-03-31, indicative of improved operational efficiency or recovering market conditions.
Operating Income: Operating income shows recovery from dismal -$55,000,000 in 2023-12-31 to $227,000,000 by 2024-03-31 suggesting successful operational adjustments.
Pretax Income: Pretax income increased from a loss of $-558,000,000 in 2023-12-31 to positive $233,000,000 in 2024-03-31 signifying a crucial financial turnaround.
Net Income: Net income significantly improved from large negative values in 2023-12-31 of $-497,000,000 to a positive $174,000,000 by 2024-03-31, demonstrating a return to profitability.
Cash Flow Indicators:
Reconciled Depreciation: Depreciation values remained somewhat consistent, indicating steady capital expenditure and asset depreciation practices.
Interest Expense: Interest expenses were substantial, impacting net income, but remained relatively stable, pointing to consistent financing strategies.
Taxation:
Tax Rate: The tax rate varied, with a peculiar dip to 0.127 by 2023-12-31, potentially reflecting variations in taxable income due to operating losses or differing fiscal regulations.
Tax Provision: Fluctuations in the tax provision correspond closely with pre-tax profitability, impacting the net income results significantly, especially noted in periods with operational losses.
Tax Effect Of Unusual Items: Tax effects of unusual items show adjustments that reflect non-recurring events affecting tax calculations.
Shareholder Metrics:
Diluted and Basic EPS: EPS was extremely volatile, moving from a low of $-3.86 in 2023-12-31 to a positive $1.34 by 2024-03-31, significantly impacting investor perspectives.
Average Shares: The average shares issued remained relatively consistent, suggesting stability in the capital structure.
Net Income Available to Common Stockholders: This figure significantly improved from negative values to a $173,000,000 net income available to common stockholders by 2024-03-31, marking a significant turnaround.
Conclusion:
WLK has demonstrated a strong financial rebound in the latest period, recovering from significant operational losses. This turnaround was supported by effective cost management, operational efficiency improvements, and perhaps favorable market conditions. Continued focus on cost containment, monitoring market trends, and maintaining financial discipline are recommended to sustain profitability.