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WLKP, Westlake Chemical Partners LP Common

Chemicals capital-intensive

We are a Delaware limited partnership formed by Westlake in March 2014 to operate, acquire and develop ethylene production facilities and related assets.

OpCo's assets are comprised of three ethylene production facilities, which primarily convert ethane into ethylene and have an aggregate annual capacity of approximately 3.7 billion pounds, and a 200-mile ethylene pipeline.

OpCo derives substantially all of its revenue from these ethylene production facilities.

Latest annual: FY2025 10-K

WLKP · Westlake Chemical Partners LP Common

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$1.2B

+2.7% YoY · 4% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $1.2B 5-yr avg $1.3B

Gross margin 31% 5-yr avg 32%

Operating margin 29.1% 5-yr avg 29.5%

Owner-earnings margin 22% 5-yr avg 28%

Free cash flow margin 22% 5-yr avg 28%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

What moves the needle: Gross margin has run about 34% and operating margin about 32% through the cycle, a solid spread between what it charges and what the product costs to make. Read this kind of business on the spread and utilization. On its own account, the filing leans hardest on concentrated dependence, set against the numbers in what the filing emphasizes, below.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
											Income statement
$987M	$1.2B	$1.3B	$1.1B	$967M	$1.2B	$1.6B	$1.2B	$1.1B	$1.2B	$1.2B	RevenueRevenue
40%	34%	29%	35%	39%	36%	24%	33%	37%	30%	31%	Gross marginGross mgn
3%	2%	2%	3%	3%	3%	2%	2%	3%	2%	2%	SG&A / revenueSG&A/rev
$366M	$374M	$350M	$350M	$353M	$411M	$348M	$358M	$390M	$320M	$360M	Operating incomeOp. inc.
37.1%	31.9%	27.2%	32.1%	36.5%	33.8%	21.8%	30.0%	34.4%	27.4%	29.1%	Operating marginOp. mgn
$41M	$49M	$49M	$61M	$66M	$83M	$64M	$54M	$62M	$49M	$58M	Net incomeNet inc.
2%	3%	0%	1%	1%	1%	2%	1%	1%	1%	1%	Effective tax rateTax rate
											Cash flow & returns
$288M	$537M	$436M	$451M	$373M	$408M	$464M	$452M	$485M	$280M	$345M	Operating cash flowOp. cash
$98M	$114M	$109M	$107M	$103M	$109M	$121M	$110M	$112M	$128M	$135M	DepreciationDeprec.
$149M	$375M	$278M	$283M	$204M	$217M	$278M	$288M	$311M	$104M	$152M	Working capital & otherWC & other
$300M	$69M	$40M	$44M	$37M	$81M	$54M	$47M	$49M	$79M	$68M	CapexCapex
30.4%	5.9%	3.1%	4.0%	3.8%	6.7%	3.4%	3.9%	4.3%	6.8%	5.5%	Capex / revenueCapex/rev
($12M)	$468M	$396M	$407M	$336M	$327M	$410M	$405M	$436M	$202M	$276M	Owner earningsOwner earn.
−1.2%	39.9%	30.8%	37.3%	34.8%	26.9%	25.7%	34.0%	38.4%	17.3%	22.4%	Owner earnings marginOE mgn
($12M)	$468M	$396M	$407M	$336M	$327M	$410M	$405M	$436M	$202M	$276M	Free cash flowFCF
−1.2%	39.9%	30.8%	37.3%	34.8%	26.9%	25.7%	34.0%	38.4%	17.3%	22.4%	Free cash flow marginFCF mgn
											Balance sheet
$89M	$27M	$20M	$20M	$17M	$17M	$65M	$59M	$58M	$44M	$44M	Cash & investmentsCash+inv
$12M	$18M	$16M	$10M	$11M	$6M	$20M	$19M	$12M	$9M	$20M	ReceivablesReceiv.
$4M	$6M	$4M	$2M	$3M	$9M	$5M	$4M	$4M	$3M	$3M	InventoryInvent.
$10M	$11M	$5M	$6M	$13M	$35M	$15M	—	—	—	$16M	Accounts payablePayables
$6M	$13M	$16M	$6M	$1M	($20M)	$9M	$23M	$16M	$12M	$7M	Operating working capitalOper. WC
$232M	$231M	$247M	$238M	$263M	$281M	$246M	$226M	$241M	$144M	$149M	Current assetsCur. assets
$38M	$40M	$49M	$39M	$40M	$107M	$67M	$56M	$55M	$51M	$41M	Current liabilitiesCur. liab.
6.1×	5.8×	5.1×	6.1×	6.6×	2.6×	3.7×	4.0×	4.4×	2.8×	3.7×	Current ratioCurr. ratio
$6M	$6M	$6M	$6M	$6M	$6M	$6M	$6M	$6M	$6M	$6M	GoodwillGoodwill
$1.6B	$1.5B	$1.5B	$1.4B	$1.4B	$1.5B	$1.4B	$1.3B	$1.3B	$1.3B	$1.2B	Total assetsAssets
—	—	—	—	—	—	25.9×	13.5×	15.2×	14.0×	16.0×	Interest coverageInt. cov.
											Per share
27.1M	28.4M	32.2M	34.5M	35.2M	35.2M	—	—	—	—	35.2M	Shares out (diluted)Shares
$36.47	$41.31	$39.88	$31.66	$27.47	$34.51	—	—	—	—	$35.07	Revenue / shareRev/sh
$1.51	$1.71	$1.53	$1.77	$1.88	$2.34	—	—	—	—	$1.65	EPS (diluted)EPS
$-0.44	$16.50	$12.29	$11.80	$9.56	$9.30	—	—	—	—	$7.85	Owner earnings / shareOE/sh
$-0.44	$16.50	$12.29	$11.80	$9.56	$9.30	—	—	—	—	$7.85	Free cash flow / shareFCF/sh
$11.07	$2.43	$1.24	$1.27	$1.05	$2.31	—	—	—	—	$1.94	Cap. spending / shareCapex/sh

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	−1.1%/yr (5-yr)	−1.1%/yr
EPS	+9.2%/yr (5-yr)	+9.2%/yr
Capital spending / share	−26.9%/yr (5-yr)	−26.9%/yr

The year, in the company's words

the filing →

Verbatim from the 10-K's management discussion. Each sentence is shown only because its subject, direction, and stated figures check out against the filed numbers on this page. The words are the company's; the arithmetic is the record's.

Net income-21.9%
“Net income attributable to the Partnership in 2025 was $48.7 million as compared to $62.4 million in 2024, a decrease of $13.7 million.”
✓ figure matches the filed record

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked.

Share count

35Mpeak FY2021

Gross margin

30%low FY2022

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$202Mowner earningsvs.$49Mnet incomelow FY2016

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetained

Each year's operating cash, by what management did with it: the mix, and how it drifts.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business turned $49M of profit into $202M of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.

Reported net income$49M

Owner earnings$202M · 17% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$49M	$62M	$54M	$64M	$83M
Depreciation & amortizationnon-cash charge added back	+$128M	+$112M	+$110M	+$121M	+$109M
Working capital & othertiming of cash in and out, other non-cash items	+$104M	+$311M	+$288M	+$278M	+$217M
Cash from operations	$280M	$485M	$452M	$464M	$408M
Capital expenditurecash put back in to keep running and to grow	−$79M	−$49M	−$47M	−$54M	−$81M
Owner earnings	$202M	$436M	$405M	$410M	$327M
Owner-earnings marginowner earnings ÷ revenue	17%	38%	34%	26%	27%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position .

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 14.0×

Comfortable

Operating income $320M ÷ interest expense $23M

What this means
Operating profit covers interest with the kind of margin Graham wanted for a defensive holding. Necessary, not sufficient, it says solvent, not cheap.
How heavy is the debt, net of cash? +$44M

Net cash, debt-free

Cash $44M − debt $0

What this means
Cash and short-term investments exceed every dollar of debt by $44M, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? -3d

Negative, funded by others

DSO 3 + DIO 1 − DPO 7 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. A negative cycle is a quiet moat: suppliers and customers fund the operation (Buffett's “float”), the company grows on other people's money.

Is it a good business?

Return on invested capital —

Not enough data

Industry peers: median 12%

What this means
The filing data didn't include the inputs for this check.
Owner-earnings margin 31%

High through the cycle

10-yr median margin, range -1%–40%; latest $202M = operating cash $280M − maintenance capex $79M

Industry peers: median 11%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 17% of revenue this year, a 31% median across 10 years.
Are earnings backed by cash? 5.76×

Cash-backed

Cash from ops $280M ÷ net income $49M

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? —

Not enough data

What this means
The filing data didn't include the inputs for this check.
Investing or harvesting? 0.62×

Harvesting

Capex $79M ÷ depreciation $128M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 2 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Near

Revenue ≥ $2B · $1.2B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 2.80×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Earnings stability Pass

A profit every year (10-yr record) · no losses

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Near

Earnings +33% over the record · +19%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $1.57/share (latest year $1.38), the averaged base the calculator's gate runs on. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 10 of 10

What this means
Never lost money over the record, the earnings stability Graham insisted on.
Operating margin 32% → 31% (3-yr avg ends)

What this means
Through the cycle the operating margin held roughly steady — about 32% early, 31% lately, median 32%.
Owner earnings growth +4%/yr

What this means
Owner earnings grew about 4% a year over the record.
Worst year 2022 · 21.8% op. margin

What this means
Stayed profitable even in its hardest year, the resilience that survives recessions.
Share count +3.0%/yr

What this means
The share count is rising, dilution works against you on a per-share basis.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$149M

Cash & short-term investments$44M
Receivables$20M
Inventory$3M
Other current assets$82M

Current liabilities$41M

Accounts payable$16M
Other current liabilities$25M

Current ratio3.65×all current assets ÷ what's due · Graham looked for 2×

Quick ratio3.57×stricter: inventory excluded

Cash ratio1.09×strictest: cash alone against what's due

Working capital$108Mthe cushion left after near-term bills

Revenue, latest quarter vs. a year ago+28.6%the freshest read on whether the business is still growing

Current ratio, recent quarters4.7× → 3.7×

Deeper floors

Net current asset value($294M)Graham's net-net: current assets less all liabilities

From the company's latest filing.

How the cash was used, 2016–2025

Over the record, the business generated $4.2B of operating cash; how management split it reads as a balanced allocator, splitting cash between the business, owners, and the balance sheet.

Reinvested$799M · 19%
Retained (debt / cash)$3.4B · 81%

Net change in share count30.1%
The diluted count rose from 27M to 35M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.
Return on what it retained11%
Of the earnings it kept rather than paid out ($578M over the span), annual owner earnings (first three years vs last three) grew $63M, so each retained $1 added about 0.11 of yearly owner earnings. Buffett's test, run on owner earnings instead of market value.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	Mr. Albert Chao	$116k	$116k	$327M
2022	Mr. Albert Chao	$120k	$120k	$410M
2023	Mr. Albert Chao	$126k	$126k	$405M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership1.1%
The stake all directors and executive officers hold together, per the 2024 proxy: skin in the game, the first thing Munger reads.

Inverting the record

Invert: instead of why Westlake Chemical Partners LP Common is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

1 of the 4 tests turned up something to look into; the other 3 came back clean.

Look hereDid the share count rise anyway?30.1%
Diluted shares grew 30.1% over 2016–2025. Owners were diluted on net; each share owns less of the business than it did. Read the buyback line beside this one, not on its own.

And these came back clean

Is it less profitable than it was?
Did reported profit become cash?
Did receivables and inventory outpace sales?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

Peers, Chemicals

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
NEUNewMarket Corp	$2.7B	29%	15.5%	20%	11%
SXTSensient Technologies	$1.6B	33%	12.3%	9%	6%
NGVTIngevity	$1.2B	37%	30.5%	22%	14%
WLKPWestlake Chemical Partners LP Common	$1.2B	35%	32.0%	—	32%
CSWCSW Industrials Inc.	$1.1B	45%	16.3%	12%	14%
BCPCBalchem	$1.0B	32%	16.4%	10%	15%
ALTOAlto Ingredients Inc.	$918M	1%	-1.8%	-7%	0%
REXREX American Resources Corporation	$650M	11%	6.8%	13%	8%
Group median	—	33%	15.9%	—	12%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Westlake Chemical Partners LP Common has delivered.

Today’s price $

Through the cycle, Westlake Chemical Partners LP Common earns about $378M on its 32.4% median owner-earnings margin. This year’s 17.3% margin runs below that; the reported figure may understate a lean year. Normalize, below, values the price on that through-cycle figure rather than the latest year.

Base Normalize · through-cycle ($378M) Net of stock comp

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25−4%/yr

Owner-earnings growth · ’16→’25+4%/yr

Owner-earnings yield—

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Owner earnings $276M on 35M diluted shares; net debt $355M. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh WLKP against another business →

Cite: Owner Scorecard, "Westlake Chemical Partners LP Common (WLKP), the owner's record," https://ownerscorecard.com/c/WLKP, data as of 2026-07-09.

Manual order: ← WLK its page in the Manual WLTH →

Industry order: ← WLK the Chemicals chapter