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Axiall lowers earnings expectations

10:12 AM MDT | July 10, 2014 | Clay Boswell

Axiall (Atlanta) says the extended ramp-up of its PHH vinyl chloride monomer manufacturing facility at Lake Charles, LA, and weakness in building products and aromatics have dampened expectations for the second quarter. The company now expects to report adjusted Ebitda of $125–130 million versus $180 million in the year-ago quarter.

“The PHH facility returned to full service at the end of June but followed a slower ramp-up to full operating rates, resulting in lower-than-expected sales volumes and higher operating and maintenance costs during the second quarter,” says president and CEO Paul Carrico.

Sales volumes for the building products segment increased in the United States but weakened in Canada, Carrico says. The weaker Canadian dollar also affected results. Aromatics' operating income will be about $12 million lower year-on-year owing to lower operating rates and lower margins, he says.

“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 says.

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