Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Westlake Chemical Corporations' Third Quarter 2015 Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. After the speaker’s remarks, you will be invited to participate in the question-and-answer session. As a reminder, ladies and gentlemen, this conference is being recorded today, November 3, 2015. I would now like to turn the call over to today's host, Mr. David Hansen, Westlake Chemical Partners’ Senior Vice President of Administration. Sir, you may begin.

Thank you very much. Good morning, everyone, and welcome to the Westlake Chemical Corporation third quarter 2015 conference call. I’m joined today by Albert Chao, our President and CEO; Steve Bender, our Senior Vice President and Chief Financial Officer and other members of our management team. The conference call agenda will begin with Albert, who will open with a few comments regarding Westlake's performance in the third quarter of 2015 followed by a current perspective on the industry. Steve will then provide a more detailed look at our financial and operating results. Finally, Albert will add a few concluding comments, and we will then open the call up to questions. During this call we refer to ourselves as Westlake Chemical, any reference to Westlake Partners is to the Master Limited Partnership, Westlake Chemical Partners LP references to OpCo referred to Westlake Chemical OpCo LP who owns certain ores in the facilities. Today, management is going to discuss certain topics that will contain forward-looking information that is based on management's beliefs, as well as assumptions made by and information currently available to management. These forward-looking statements suggest predictions or expectations and thus, are subject to risks or uncertainties. Actual results could differ materially based upon many factors, including the cyclical nature of the chemical industry; availability, cost and volatility of raw materials energy and utilities; governmental regulatory actions and political unrest; global economic conditions industry operating rates; the supply demand balance for Westlake's products; competitive products and pricing pressures; access to capital markets; technological developments and other risk factors discussed in our SEC filings. This morning, Westlake issued a press release with details of our third quarter 2015 financial and operating results. This document is available in the press release section of our webpage at westlake.com. A replay of today's call will be available beginning two hours after completion of this call until 11:59 PM Eastern time on November 10, 2015. The replay may be accessed by dialing the following numbers; domestic callers should dial 1-855-859-2056; international callers may access the replay at 404-537-3406. The access code for both numbers is 58784977. Please note that information reported on this call speaks only as of today, November 3, 2015, and therefore, you are advised that time-sensitive information may no longer be accurate as of the time of any replay. I would finally advise you that this conference call is being broadcast live through an Internet webcast system that can be accessed on our webpage at westlake.com. Now, I would like to turn the call over to Albert Chao. Albert?

Thank you, Dave. Good morning, ladies and gentlemen and thank you for joining us on our earnings call to discuss our third quarter results. In this morning's press release, we reported quarterly net income of $184 million or $1.39 per diluted share on sales of $1.2 billion. Our results this quarter reflect the value of our investments to fully integrate our Vinyls chain and the contributions from our acquisitions of Vinnolit and North American Specialty Pipe that were made over the past few years. Our third quarter results were impacted by the downward pressure on integrated olefins margins and ethylene prices resulting from the new ethylene capacity that came on steam and by lower crude oil prices which saw a 24% decline in the quarter and which represents a 50% decline year-over-year. In spite of the lower prices in the third quarter we saw solid demand for our end products and increased volumes in polyethylene sales was improvement over prior year levels. We benefited from good domestic and strong export demand in spite of concerns over the pace and strength of global growth. Results for our Vinyls business also improved, driven by the addition of Vinnolit and the gradual recovery of the housing and construction markets. Now I would like to turn our call over to Steve to provide more details on the financial and operating results for the third quarter. Steve?

Thank you, Albert, and good morning, everyone. I will start with discussing our consolidated financial results followed by a detailed review of our olefins and Vinyls segment results. Let me begin with our consolidated results. In this morning's press release Westlake reported net income for the third quarter of 2015 of $184 million or $1.39 per diluted share on net sales of $1.2 billion. This represents an increase to net income of $16 million or $0.14 per diluted share compared to the third quarter 2014 net income of $168 million or $1.25 per diluted share on net sales of $1.3 billion. Third quarter 2015 net income benefited from approximately $23 million or $0.17 per share primarily due to tax planning initiatives resulting in increased tax benefit in certain prior years and the current year. We estimate that as a result of the tax planning initiatives, our ongoing effective tax rate on ordinary income will be approximately 33.5%. Additionally our third quarter income from operations is lower by approximately $34 million due to both unplanned outages and planned maintenance turnaround at various North American and European facilities. For the third quarter 2015 net sales decreased by $65 million over the same period in 2014 due to lower sales prices for all of our major products, partially offset by higher sales volumes for most of our major products and from sales contributed by Huasu, our Chinese PVC operation in which we acquired a controlling interest on June 1, 2015 and from Vinnolit which we acquired on July 31, 2014. Third quarter 2015 income from operations was $254 million, a decrease of $53 million from the third quarter of 2014 driven by lower integrated product margins that were the result of lower sales prices and the planned and unplanned outages. These results were…

Thank you, Steve. The current oil to gas ratio remains favorable for U.S. petrochemical industry competitiveness and counties to provide an advantage of lower cost energy and feedstocks from which we are well-positioned to benefit. We are working to continue to capitalize on this advantage and complete work to expand our ethylene capacity by approximately 250 million pounds in Lake Charles in the first half of 2016 in order to further lower our cost position and balance our ethylene integration, Our new world class, [road scale] Geismar chlor-alkali plant and feedstock conversion and ethylene expansion of our Calvert City facility and the acquisitions of Vinnolit and North American Specialty Pipe continue to make solid contributions to the operating margin and cash flow of our Vinyls segment and highlight our integration strategy as specialty product focused. Demand for our products has steadily improved over the past several years as we expect this trend to continue. The consumer flexible packaging market that our Olefins segment serves continues to grow consistently and we are the leading producer in the Americas of low-density polyethylene and love to grow with this market. With the completion of our ethylene integration in 2016 we will be one of the most integrated and the lower-cost producers of PVC. Export opportunities for our polyethylene and PVC should continue to grow consistently as global economies recover and global GDP growth improves over current levels. We remain focused on identifying opportunities that will strengthen our product integration and grow our earnings potential. Thank you very much for listening to our earnings call this morning. Now I will turn the call back over to Dave Hansen. Dave?

Thank you, Albert. Before we begin taking questions I would like to remind you that replay of this teleconference will be available starting in 2 hours after we conclude the call. We’ll provide that number again to you at the end of the call. Operator we’re now prepared to take questions.

[Operator Instructions] Our the first question comes from the line of Aleksey Yefremov from Nomura Securities. Your line is now open.

Good morning. Thank you. I apologize if I missed this but what was the impact of Vinnolit outages and the gas outages in the third quarter?

The total outages impact in the third quarter was $34 million impact. That includes both European and North American impacts.

Did you have any negative impact from shortage of ethylene in Europe in the third quarter?

The impact that we saw was in the second quarter and not in the third quarter.

Can you provide your thoughts on U.S. polyethylene pricing outlook and also the level of polyethylene inventory in the U.S.?

Yes. Certainly. There is a price increase announced by members of the industry of $0.05 a pound and it's effective on November 1st. I think the inventory levels I would say for polyethylene in the U.S. are about average for producers and on the lower side for customers.

Thank you very much.

You are welcome.

Our next question is from the line of Jim Sheehan from SunTrust. Your line is now open.

Operator can we move to the next one. He can re-queue in.

Our next question is from the line of David Begleiter from Deutsche Bank. Your line is now open.

Good morning. This is actually Jermaine Brown filling in for David. Two questions. Can you talk about the caustic demand that you are seeing in the Asia-Pacific region and how it is tracking versus historical levels?

We don’t sell caustic in Asia and we don’t export caustic much internationally. But I understand that the chlor-alkali demand has slowed down a bit so the caustic production probably has slowed down a bit in Asia in the upcoming winter months. So if the industry can manage weak caustic [indiscernible] caustic production as well.

Understood. Can you comment on the pace of the buybacks out through 2016?

Our program of buybacks was active in the third quarter as well as the second quarter of this year and what we have said is that the program is an opportunistic program that you see that we have been active throughout the second and third quarter and as I mentioned we have returned about $200 million back to shareholders in the form -- and unit holders in the form of share buybacks, dividends and distributions to our partners' unit holders. But as I said the program itself is discretionary but you can see that we have been active in the last two quarters.

It's fair to assume that the pace would continue at a similar amount going forward.

Definitely it will.

Thank you. That's all that I have.

Our next question is from the line of Hassan Ahmed from Alembic Global. Your line is now open.

Good morning, Albert and Steve. A question around near term effective utilization rates for ethylene. I mean you guys yourselves are talking about some turnaround in sort of Q2 of '16 and it seems a fair number of people are doing that. So are we sort of setting ourselves up for a year in '16 similar to '15 where all of a sudden you see tight effective utilization rates on the back of a number of call it planned and certainly some unplanned outages and maybe potentially [spite] and spot ethylene prices?

From what we understand that's over 10% of our capacity that will be out -- lie in turnaround about March-April-May period. So potentially the interest rate could be tighter at that time.

Now just a longer term question. You talked about sort of LDP demand and the strength associated with that. I guess one of the virtues of polyethylene side of things has been that polyethylene supply demand has been tighter than ethylene supply demand. So hence sort of a pricing premium. Now going forward as and when all of this announced North American ethylene capacity comes online it just seems that a number of people haven't really announced this derivative intention. So what are you hearing in terms of ethylene integration into polyethylene in general? Is the bulk of the ethylene sort of capacity increment going into polyethylene? So that's kind of on the general side. And beyond that LDPE in particular.

Certainly. I think you are right that with the increased capacity in ethylene, the ethylene prices in stock has resulted because of lack of derivative demand to catch up with the ethylene supply. I presume people do expand without broadcasting to the market. That people are looking at expansions down derivatives. As far as new ethylene plants that have been announced. They are usually tied with the downstream derivative plants and most of that is polyethylene, about 60% of ethylene today goes into polyethylene. But most of the capacities are not in LDPE, that's where Westlake's major product in polyethylene is. So we will be seeing more of the commodity grades [are being] low in high density and less of LDPE in the market on a global basis.

Super. Thanks so much, Albert.

Our next question is from Arun Viswanathan from RBC Capital Markets. Your line is now open.

So I guess just curious on the caustic side, what are your observations in the market right now? Are your customers accepting the current $30 that we have seen built through the indices and what's your expectations for the rest of the $65 that's been announced?

Yes. I think in October that industry accepted the $30 to $35 price increase in caustic and the export demand is good as well. So we look forward to the rest of the $55 price announcement that's been put in place for [fourth] quarter.

Albert, do you believe that the market is tight enough that these prices will stick well in the Q1 even when maintenance comes back online?

Well it depends also on the demand for PVC. We are heading into winter months now. If the weather is steadier and PVC demand slows down a lot then there will be less production of chlorine hence the less production of caustic.

Thanks. If I may another one on your overall cash use priorities. You discussed in the past your preference for potentially buying assets in somewhat depressed regions. Are you still seeing those opportunities? You definitely have quite a nice cash balance on your balance sheet, how do you expect to deploy that and maybe you can just discuss a little bit on the M&A pipeline right now? Thanks.

Arun as we have said and as Albert noted in his closing comments or in the prepared comments that we continue to look for opportunities to deploy this capital and you will see that in '13 and '14 we acquired some I think attractive assets that contributed to results this quarter and I am speaking to the North American Specialty Pipe business that we acquired in '13 and Vinnolit last year. We will continue to look for good opportunities such as those and that's confidently something that we look at as well as the organic initiatives reports that we always pursue.

Thank you.

You are welcome.

Our next question is from the line of Frank Mitsch from Wells Fargo. Your line is now open.

Good morning. Steve I will take that last response as a yes in terms of the M&A. There's a lot of capacity coming online in VCM and PVC, not a lot but a material amount and this has not been the best of years 2015 in terms of utilization rates and demand. As we start to think about 2016 and a little bit more capacity out there, what are you guys thinking about in terms of the demand side? How should we start thinking about 2016 in terms of that part of your business?

Certainly the U.S. construction market has improved albeit still gradually. In September we have the housing construction at 1.2 million annual rate which is better than last year's average about 1 million units. Hopefully with a recovering economy that next year that the construction and the multi-family and single-family homes continues to grow. And also because of the advantage, the cost position we have in the U.S., the U.S. is ready to export more PVC to international markets. The international market demand is still good and so there will be more exports from the U.S.

I mean we have been exporting quite a significant amount so far, so you anticipate that that will continue to grow if we do not see the sort of housing recovery or at least enough of a robust to housing recovery, you think that that's where we are going to put all this parts then?

Yes.

On the -- as we think about the further upstream I guess on the chlor-alkali side, a couple of competitors are at least talking about rationalizing some capacity there. What would your expectation be for operating rates in chlor-alkali which I guess has been around the mid-80s in 2015? How should we be thinking about that in 2016?

I think probably it will be the same ballpark. There is about 300,000 tons of chlor-alkali capacity coming on stream next year as well. So probably would still be in the mid-80s.

Thanks so much.

You are welcome.

Our next question is from Brian Maguire from Goldman Sachs. Your line is now open.

Good morning. This is Ryan Berney on for Brian. Just had a quick question. Could you maybe give us an update on the planned turnaround that you have early next year? You still kind of thinking it will be around 90 days and then maybe comment on how that will impact maybe the first quarter versus the second quarter?

As we noted it will be a planned 80 day outage. It will be completed in the second quarter, so it starts earlier in that second quarter and will be completed in that second quarter. As I noted in our remarks we expect the impact for those 80 day outages will be about $45 million to $50 million between that and some other planned turnaround activity occurring in that second quarter.

Great. Thank you. Then maybe could you also give a sense from a bridge perspective for the maintenance CapEx for '15 versus '16?

So I think the maintenance capital certainly is other than the turnaround related activity is going to be as we normally would expect it to be year-on-year. That's to say when I think of the total capital spending that we have for our business maintenance capital tends to run in the neighborhood of about $150 million. But of course it will be higher in '16 because we will focus some of that into the work-related to the expansion and debottleneck of Petro 1.

Great. Thank you.

We haven't given guidance yet for the '16 total capital spending budget. We will do that once we have finished our budgeting processes.

[Operator Instructions] Our next question is from the line of Don Carson from Susquehanna Financial. Your line is now open.

Yes. A question on polyethylene inventories. Albert you mentioned you thought that producer PE inventories were at about average levels. When will you start anticipating that to rise? Because, for example, considering your own situation as you take down Lake Charles, at what point you start building inventory to see it through that turnaround? I know some of your competitors have even earlier turnarounds coming. So do you expect that that need to build inventory will offset any softness we are seeing in spot chlor-alkali ethylene prices?

We expect that people will stop using more inventory heading into the winter months and early part of next year, ready for a turnaround in spring which is more rightly between March and May period.

Then finally, any update on the IRS MLP proposals. What further discussions have you had with them?

Don, we certainly participated in the formal 90 day comment period that ended in early August. Then there was a hearing that the IRS held in October where they took formal comments from all the commenting companies and we have participated in that hearing process. No update from the IRS in terms of their timing other than what they told us earlier this year back in May which would be a targeted day of late spring or early summer of '16 for final regulations. But no update since May on that timeframe. So we are still working with that timeframe.

Thank you.

Our next question is from Jeff Zekauskas from JPMorgan. Your line is now open.

Good morning. Are you surprised that price of ethane isn't lower with natural gas being pretty close to $2?

Well the demand for ethane is still very strong. Ethane still among the [holistic stock] cost in U.S. and there will be also ethane export in the coming months. So I think the ethane price is reasonable.

Some people think there is 500,000 barrels per day of ethane being rejected. Why would there be a $0.05 premium to the ethane price over its fueled out value given there is so much rejection? Do you have any feeling on that?

No. Your guess is as good as mine.

I noticed that you had bought back about $50 million of stock in the quarter and I think your share price averaged maybe $58 or so.

Yes. It was $53 and we were -- and you are right we are in the mid-50 in terms of millions of dollars but it's got a $53 price.

$53 price. Well I think in the previous quarter you bought back $60 million worth of stock maybe at around $72. So?

Yes, that's right.

Yes. So why is that that you have spent less even though your stock price went down quite a bit?

Opportunities Jeff. We continue to be opportunistic and certainly we continue to be opportunistic and as I mentioned to one of the earlier questionnaires, we will continue to look at the program and buy shares.

So you are citing that the probability that you might need cash for acquisitions went up?

No, Jeff. I think the level of granularity between the number of the shares, of the dollars and at where volume is relatively insignificant to the balance that you see that we had at the end of the quarter.

How much do you still have to spend for your ethylene expansion next year?

Well we are largely through the long lead items and what we have said is that -- so we are about half way through that spending. But the great majority of that spending will occur when we get to that second quarter of '16.

And forgive me, did you talk about what the total cost of the expansion project was?

We have given -- we have given no direct guidance on the amount of that other than to say and I am talking about the expansion and not the turnaround related item.

Yes. Exactly right. So how much did you say you are spending for expansion or when you have done it similarly in the past how much did you spend?

The guidance range we gave was $350 million to -- $350 million is the midpoint of that range.

Okay. Good. Thank you so much.

Our next question is from David Wang from Morningstar. Your line is now open.

Also would like to talk a little bit more about the polyethylene margin, we see more of the accelerated margin come from that part this quarter. I was wondering, if you can talk about if you think that this segment could sort of tighten in the future or if you think that these prices are sort of sustainable?

Well the $0.05 of current price announced for November 1st and demand has been quite strong automatically -- internationally for polyethylene in general.

Can you talk about what your thinking is around propane versus ethane for feedstock given the recent decline in propane prices?

Sure. Propane price has fluctuated a lot and in the summer time it was very [advantaged] over ethane. Since then it has risen and today it's probably on par with ethane.

Thank you so much.

You are welcome.

Our next question is from the line of John Roberts from UBS. Your line is now open.

Once you finish ethylene expansion I think your capital spending cupboard is kind of bare. Do you have any engineering studies underway for anything else significant beyond that?

John as you can imagine we are always looking at opportunities to take further debottleneck opportunities in this business and so while we have made no formal announcements at all, as you can imagine and that's a constant study and analysis process that we aim to take.

Is there any update on the Eastman litigation?

No, John. I think you remember that there were two issues there. One was, the directional flow and one was, the tariff itself, terms of the value of tariff. The tariff itself has been agreed I think in terms of being market oriented and we have taken into the court system the other matter and that's going to take some time to get resolved.

Is there a date for an initial hearing or fact finding meet?

It will be later this quarter.

Thank you.

At this time the Q&A session has now ended. Are there any closing remarks?

We would like to thank you very much for participating in today's call. We hope that you will join us again for our next conference call to discuss our fourth quarter and full year 2015 results. Thank you very much and have a wonderful day.

Thank you for participating in today's Westlake Chemical Corporation's third quarter earnings conference call. As a reminder, this call will be available for replay beginning two hours after the call has ended, and may be accessed until 11:59 P.M. Eastern time on Tuesday, November 10, 2015. The replay can be accessed by calling the following numbers; domestic callers should dial 1-855-859-2056; international callers may access the replay at 404-537-3406. The access code at both numbers is 58784977. Thank you.