Cheniere Energy’s profits rise as demand for LNG increases
Houston liquefied natural gas company Cheniere Energy said Tuesday that its first quarter profits rose as the LNG industry bounced back from the coronavirus pandemic and the winter storm that pummeled Texas in February.
Cheniere reported a $393 million profit in the first three months of the year, up 5 percent from $375 million during the same period in 2020. Revenues rose 14 percent to $3.1 billion in the period from $2.7 billion in the first quarter of 2020.
Cheniere CEO Jack Fusco said during a call with analysts that the company’s operations at its Corpus Christi facility were disrupted for a few days by power outages during the winter storm, but operations were quickly restored. Cargoes continued to ship from Cheniere’s Sabine Pass terminal in Louisiana, helping to set a quarterly record of 133 cargoes during the first three months of 2021.
“The global LNG market has recovered significantly for 2021 and beyond,” Fusco said. “Demand has outstripped supply, resulting in higher prices.”
During the quarter, Cheniere began a 25-year LNG purchase and sale agreement with CPC Corporation in Taiwan in January. The company said it also entered into multiple fixed-fee LNG sales agreements for about 1.7 million tons of LNG across 2022 and 2023.
Cheniere’s projects are moving ahead, with Train 3 at its CCL Project near Corpus Christi completed in March, within budget and ahead of schedule, the company said. The project has a production capacity of about 15 million metric tons per year of LNG.
The expected completion date of the sixth natural gas liquefaction unit at Cheniere’s SPL Project at its Sabine Pass facilities in Louisiana has been moved up to the first half of 2022 from the second half of 2022. Once completed, the facility will have a production capacity of around 30 million metric tons per year of LNG.
Cheniere’s stock rose 11 cents to close at $79.55 a share.
Westlake profits soar
Houston chemical manufacturer Westlake Chemical Corporation said Tuesday that first quarter profits soared despite the challenges of the global pandemic and the winter storm that disrupted operations.
The company said its earnings jumped two-thirds to $242 million in the first three months of the year, compared to $145 million during the same period in 2020. Revenues rose 22 percent to $2.36 billion in the period from $1.93 billion in the first quarter of 2020.
Westlake said its profits were driven by packaging and construction products and shortages that drove prices higher after February’s winter storm brought Texas refineries and petrochemical plants to a standstill.
U.S. production of polyethylene, one of the most common plastics, was cut by almost 75 percent because of the storm. Production of the plastic. Polyvinyl chloride, or PVC production, fell by about 57 percent, leading to a doubling of prices since the summer.
“Westlake had a strong start to 2021 as we experienced solid financial performance as we benefited from the continuing global economic recovery and robust product demand paired with higher prices and margins for many of our products,” CEO Albert Chao said in a statement.
Westlake’s stock jumped more than 3 percent to close at $97.91 a share.
Sysco rebounds
Sales at Sysco, the world’s largest food distributor, were still down during its third quarter as the pandemic continued to depress restaurant traffic across many American and European cities.
The Houston company reported a $89 million profit (17 cents a share) in the quarter ended March 27, compared to a $3 million loss (1 cent) during the same period last year. Revenues decreased 14 percent to $11.8 billion from $14 billion a year ago.
In an earnings call Tuesday, the company pointed to a pandemicera transformation that is allowing it to grab market share.
Sysco plans to hire 6,000 people in the second half of the year, the company said.
“It’s less visible in our total topline because in many cities in this country there are still significant restaurant restrictions,” said Kevin Hourican, Sysco’s president and chief executive. “But those new customer wins are going to pay dividends for us as this recovery that we are now a part of begins to further accelerate.”
Sysco’s stock lost about 1 percent Tuesday to close at $83.18 a share.
Plains All American up
Houston pipeline and storage terminal operator Plains All American Pipeline on Tuesday said it swung to a profit in the first quarter, despite the challenges of the pandemic and February winter storm.
The company reported a $422 million profit in the first three months of the year, compared to a $2.85 billion loss during the same period in 2020.
Revenues rose about 1 percent to $8.38 billion in the period from $8.27 billion in the first quarter of 2020.
“We delivered first-quarter results that exceeded our expectations,” CEO Willie Chiang said in a statement. “We are increasingly constructive in our outlook for global energy demand recovery and for a corresponding supply response to build momentum through 2022.”