Earnings call transcript Q4 2022

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Operator

Hello, and welcome to the LyondellBasell Teleconference. At the request of LyondellBasell, this conference is being recorded for instant replay purposes. [Operator Instructions]

I would now like to turn the conference over to Mr. David Kinney, Head of Investor Relations. begin. may you Sir,

David Kinney

operator. you, Thank

investors. be we and financial begin out is like point statements upon forward-looking we I on making based results reference are to alternative We the a slide believe measures discussion, some are will Today, that www.lyondellbasell.com/investorrelations. call and website would our presentation useful business our while the non-GAAP to to statements at Before assumptions discussing measures. accompanies available forward-looking reasonable today's the

the subject learn available uncertainty. about website. Relations lead Nonetheless, are statements We presentation and encourage differ the could in and statements significant risk cautionary slides to our forward-looking to that reviewing our results you more our also regulatory on Investor the the are by filings, to actual factors which

this call as measures financial be identified items. will using to per excluding in such results business our share, made Comments on underlying non-GAAP EBITDA earnings and regard

financial documents on GAAP business Investor reconciliations together website discussion. financial and provide Additional the our other including release the measures results measures, our earnings to with disclosures, non-GAAP of

call (XXX) be United The A (XXX) this XXXXXXXX. is X access in for calling at States today until will Eastern the of available March by beginning by XXX-XXXX United both numbers the X:XX XXX-XXXX recording outside p.m. and telephone Time code States.

EVP Solutions. Ken our our of Advanced Vice Foley, President EVP Executive Joining today's Olefins and Intermediates call CFO, Polyolefins; Torkel will be and Peter Refining; Kim Vanacker, Lane, our our Michael of LyondellBasell's Chief and Polymer Executive McMurray; Rhenman, Officer; and Derivatives Global of

current and market quarter the outlook. results, we dynamics XXXX today's will near-term call, During on year fourth focus and our full

now would call turn the that over to said, Peter. With to being like I

Peter Vanacker

year welcome you. as results. you to XXXX and us full fourth our We David, today appreciate quarter of and you, Thank we discuss joining all

our Slide begin Let's safety number results on X. with

worked. global last [X.X] finished Bayport workforce consecutive year, roughly for complex XXXX. performance outside But our by to XXXX we hours at across consistently company have rate Houston, safe of contractors X work the team new LyondellBasell's among lowest safety injuries employees of outstanding the with over an million our Injury injuries been per and At during rates our delivered XXX,XXX industry. a hours, company record. X.XX our reduced our

a work our on of put, focus DNA Simply extending shared solid embedded focus provides safe across in foundation consistent a the company's is company's that dimensions other culture. and for

Let's XXXX a inflation changing pandemic, COVID now energy number Ukraine, characterized the results. monetary rapidly very Slide to by was responses turn challenging and volatility, to war to policies. discuss X year financial our in a evolving

$X.X second resulted with strong LyondellBasell, of earnings of global $X was to At a exceptional billion. products our with value cash our to $XX.XX with In provide rate 'XX, ended balance XXXX results. share per We from only LyondellBasell are portfolio and for in billion EBITDA investment of of and sheet. continued solutions liquidity by operations; essential $X.X Cash generation businesses our that of billion the for year society. modern customers delivered supported

capital. invested Interim of exceeding our far was XX%, cost capital

we shareholders safety, strategic maximize our focus under for value on and are focus our sharpening customers, of to range addition In a our scenarios. society to

this outlined On from on value progress the X, past strategy Slide over year. our number delivering we

evolving adjust excellence in hold enabled well operating market management quickly inflation, leadership below costs cost and in operational conditions. rates Our and LyondellBasell to to fixed response

sell refining And cash business. time, challenging decisions changing diverse for during the generation provided our portfolio year. positioned exit at we and a times to outstanding polypropylene Australian portfolio Our business global with same the

low-carbon our chains, are for products. growing established low-carbon serve circular and providing a advancing these rapidly customers. we unit, markets new and We supply in our to sustainable for focused on circular capacity and business establishing production leadership assets solutions And

as manage we value Last costs. on quarter, we announced continue our to capturing focus increased

expect program XXXX. EBITDA by generate We $XXX the in annual least at recurring end of value our enhancement will million

improvement announced in and percent Agreement, recent target helped degrees On be relative focus of should supported global [XX cash Slide goals value doing more established like Celsius climate in XX% and increased X.X decisions levels. highlight I the and above and warming X progress December, Paris to Climate X conversion of pre-industrial LyondellBasell's create a than In new our the shareholder Scope would XXXX. reducing to In number scope XXXX That increase our a XXXX Scope drive more order to reduction X, emissions to generous emission targets our Our to on climate meet so. scientists returns. we point] no XX% accelerate that capital further our structure by targets limited decision bolstered levels. for believe X to to

with guidance are Targets science-based now Celsius aligned the X.X degree scenario. the and

XX% sourcing, In in priced increased procure least and progress addition, as we make continue renewable of our from needs power global we low-carbon to our favorably to generation at renewable XXXX goal sources. electricity, have

we week, power first in global of announced in now megawatts X power which of capacity, renewable Altogether, United agreements agreements roughly Europe States. purchase for this Earlier needs. have agreements X/X XXX X represents the we our X our additional renewable and in place

greenhouse will gas agreements prevent X tons These nearly emissions. million annual of

that renewable we work X net global by continued and this our Scope time, by Scope become recycled build sell zero tons least At emissions base in the XXXX. same polymers and of supports X XXXX. of will million businesses to at All X to goal

we X, Slide of look how let's and polymers. building recycled our a number On renewable base brands at Circle take are

facilities sorting X and China. fourth new the waste and progress India in During quarter, we Germany, developing recycling in Houston, announced plastic

with and supply be provide recycling, feedstocks for strong with mechanical the solutions global X value product able for CirculenRecover for platforms, recycling, will foundation and feedstocks, match for for highest plastic And customers. chain our a products for to facilities robust grade CirculenRevive advanced a our renewable-based feedstocks. LyondellBasell These CirculenRenew

to powerful The build combination the with world's and of our Solutions global low-carbon advantages and LyondellBasell focus, leading platforms detail, circular business. technologies provides

call will business over Now our then more to financial with that, first, and and in of each results who Michael the to segment detail. leaders our describe will I turn

Michael McMurray

let turn the our excellent everyone. total Slide cash Please me from you, X, business billion highlighting and and good past our portfolio from of to a activities operating generated year. by morning, over $X.X Thank LyondellBasell cash generation of begin XXXX. during Peter,

Our hand cash on at increased fourth quarter. billion to of end the $X.X the

than conversion we XXX%. cash XX fourth cash of conversion achieved an XXXX, During the rate of higher percentage points XX%, conversion. quarter, XXXX outstanding In cash reached our

cash a This of robust to allowed company LyondellBasell billion the to efficient total and XXXX. $X.X shareholders in generation return

X of details and the continue capital the allocation Slide Let's our over review past with year.

strong our capital shareholders. disciplined returns for and on focused remains approach Our allocation

activities in and repurchases the We million This dividend expenditures. operating by $XXX approximately and from dividends and cash funded activities repurchases. fully increased May, $X.X X%. billion our returned quarterly cash XXXX, operating share dividends, in share included special quarterly shareholders. During from we to capital of XX% In

dividend our of annual represents year XXth consecutive This growth.

continue projects funded maintenance and of final to construction We of significant our invest stages plant. with in of PO/TBA in this world-scale billion $X.X capital growth A capital the portion expenditures.

remain activities Startup on of end the this track for quarter.

at program. our in the is sharing manage progress of to working and across track progress transformation Our Day company this to March. look the our We forward program enhancement of our value rigorously Markets Capital of

quarter. delivered quarterly of business during for an $XXX provide the each of fourth segments to Slide EBITDA XX. our of results million on the overview like I'd portfolio Now LyondellBasell's

towards end reflected the quarter. levels Our at low margins results stabilizing the of third seen the

declined and lower and energy vessel compressed modest Moderating in and on shipments. Derivatives China. polyolefins in provided sequentially remained the Overall, feedstock olefins businesses. volumes timing particularly for offsets results low, Intermediates our oxyfuel margins demand costs and OMP to quarterly due Europe of

and oxyfuels seasonal businesses High demand with averages segment. our Solutions utilities remained Polymer negatively refining above to strong at raw for materials and Margins global impacted mobility. our low due demand for historical fuels as remained coupled increasing Advanced cost

quarter by and refining the Across charge the LIFO $XX million. for the intermediates O&P the for noncash approximately each LIFO derivatives segments, [EII] fourth for $XX million for segment, results and benefit segment. $XX in $XX quarter portfolio, million APS O&P $XX segment inventory charges a segment Americas pretax were Technology million a million the for approximately impacts Fourth valuation

and As energy change in a natural in of Europe. per XX% impacts million not cost $X in $XXX but our XX% volatility a million of gas, reminder, cost We that also prices price year the BTU electricity. operated our with for steam gas directly America by only the North the approximately across assets impacts and company in per gas of natural this estimate impact

include not the of do estimates cost. These feedstock price on impact gas

leaders, segment business your the to each our Before more our results me questions detail, describe and Slide some of XX. call let who of I on turn XXXX for annual will then Ken modeling address to over in

confident remain of half achieve about projects. EBITDA execution about As world-scale that produce asset's program PO/TBA million nameplate end enhancement capacity ramps to value XXXX $XXX sell new of XXXX. expect recurring up, by in the We through our we of the the our annual of X,XXX can plant and

In order about a benefit, costs capital the to capital. allocated to amount I&D cost we million, this expect maintenance our to planned plant of of at Major within crackers for XXXX achieve propylene acetyls segment. of included $XXX Midwest majority segment, the similar these operational and onetime Americas with O&P oxide ethylene X our of our turnarounds turnaround a turnarounds and one assets in at incur

EBITDA with volumes $XXX downtime and and expected this on associated XXXX of lost production impact we approximately all that estimate maintenance Based million. margins, will by

are capitalized costs maintenance of and turnarounds in expenditure our arising expensed, units are forecast. costs maintenance included routine production from major While capital

fourth impacted quarter, $XX refining the the which costs exit million. to from we EBITDA During our by business, recognized related

quarter quarter, As incur expect impacts will each during XXXX. I mentioned last similar the business we EBITDA of

quarter asset will to reflect recognize charges down. be each cost that million will for about decommissioning the after We incurred for accrued also depreciation $XX shuts asset

this will targeted and completion approximately of expect with CapEx profit-generating the Approximately year current projects spend sustaining PO/TBA supporting that plant the our resulting $XXX remaining disciplined from capital $X.X billion We million maintenance. is $XXX million about the by to with balance decline business of the growth environment. towards expenditures

for include estimates tax financial pension requirements We net interest within expect rates. value our capital be metrics Other amortization, noting expense, year's budget. worth CapEx that funded billion depreciation program enhancement the $X.X this will related and and

Depreciation interest be charges be decommissioning. expected refinery net billion, of approximately $XXX $X.X the million. XXXX million] [$XXX additional XXXX asset to amortization depreciation and charges related expect which to are expense We for will includes

the approximately pension to year. for XXXX, contributions We totaling million about $XXX with plan of expense regular $XX pension make million in

XX% our will approximately than lower will We our be be tax expect ETR. effective cash tax and our rate rate

Ken. that, over turn I'll call With Ken? the to

Kenneth Lane

Michael. you, Thank

Olefins third of we the Slide quarter. also levels Fourth Prices at Market margins saw quarter our segment. stabilized performance was EBITDA we begin the low with Polyolefins Americas the the end saw Americas customer million. and segment the quarter. the destocking XX declined, $XXX at and Let's on of discussions demand and O&P during

at assets and our with That, capacity capital. XX% polymer reduced approximately in well-supplied new markets. operated market combined resulted manage the demand match of capacity working nameplate We to

we During export January, constraints domestic volumes. have of seen facilitated demand. in Normalization improvements increased and modest export have logistics

tailwinds. and costs providing moderating are Also, feedstock some energy margin

we a approximately XX% O&P an quarter. As expect average first the of result, operate to at Americas our asset during

our want developing Looking to back our Circulen at highlight on business. We progress XXXX, I

projects established product will have Revive feedstock that for recover waste the provide for our lines. sorting certain to used be classic and facilities circular

from We produced sources feedstocks are moving also oil. cooking as phoned our such used of olefins usage renewable

XXXX, During produce premium that Channelview, ultimately, tons under customers polypropylene brand. Circular to to and at ethylene, Texas of renewable XX,XXX processed at our we polyethylene we sold our cracker, prices and feedstocks propylene

LyondellBasell polyethylene our certificates ISCC and market's Last growing of sites these attained the and offer year, U.S. customers to Plus manufacturing X mass enables balance products for grades serve rapidly the for demand. certification polypropylene. This of certain

We used. where more can application be and virgin that customers circular proving used sustainable any is new new and our to these are delivering polymers polymer products in

Now and turn review Olefins performance Europe, XX please International Slide segment. to Polyolefins, of Asia our the to and

pressured In quarter. and our high O&P curtailed energy exacerbated operated rates were our pressures $XX that quarter. approximately million at Europe, and during were LyondellBasell consumer demand. operations the by LIFO XX% assets inventory the at during macroeconomic costs inflation customers fourth of charges

a in loss million. EBITDA this of of result fourth $XXX combined to All quarter

the some signs in European have December. improvement moderated demand over considerably showing extremely of in low energy and level seen January, is costs

rate we repairs in during cracker a have our at and started XX% of operate quarter. of completed European XXXX and at first expect We France the integrated the to end our assets

to Low Solutions Asia. the Circulen in long-term our in continue and business strategies As on to we and Americas, Carbon Europe focus support

mechanical announced recycling we sorting facilities and India. waste new for automated a China, October, plastic and Germany in During fully in partnerships facility

forward we develop plants with scale to in allow engineering to served partnerships announced circular These each region our in Germany. rapidly first decision move our circular feedstocks recycling In growing our will November, us supply to fit-for-purpose solutions. commercial products for to market swiftly for a plant advanced has build

pyrolysis technology sorting process. to proprietary in can plastic This facility new utilize waste as waste be a to from a our resins that LyondellBasell's will used produce into convert plastic feedstock plant MoReTec circular oil

We circular for solutions industry are moving rapidly unmatched build low-carbon scale. our and at to an

With will turn call that, I to Kim. the over

Kimberly Foley

to our due margins at XX fourth Ken. Slide $XXX above we intermediates improved EBITDA Oxyfuel remained quarter segment. to well Fourth and a as Derivatives feedstock costs. Please historical turn you, Thank margins look Styrene lower take quarter averages. million. was

volumes declined Oxyfuel volumes. XX%. vessel rates the the of at timing We sailings high assets approximately unusually quarter in operated of as our resulted third

Our volatile this of X in month European restart after venture in demand. costs expected lower and propylene to oxide the energy and joint styrene to is response Netherlands months downtime

quarter. in by plan new the January, quarter. feedstock segment IND and PO/TBA oxyfuel the butane we the We the the operate blend across to look unseasonably XX% assets strong by first oxyfuel our forward in In of from to premiums. at margins We are costs encouraged low initial asset with end volumes Houston approximately strong

We to that ensure expect segment our the plants quarter. serve for for stable first the our and safely maintenance We relatively reliably multiyear customers. developed schedules can margins

XXXX our out, for be works year heavy assets. maintenance of several it a will As across PO/TBA

Maintenance of for plants in X and the scheduled quarters. facility second our at our Bayport, is PO/TBA Texas fourth X

the Our September [indiscernible] in will through PO/TBA undergo facility maintenance from November. Netherlands also

the partially from volumes our maintenance. expect of new We be planned by plant loss in production will offset this ramp-up

typical growth. In we capture XXXX, volumes and Nonetheless, will sufficient assets scheduled from maintenance the production provide to should of to market serve XXXX be PO year full expect less our and volumes market new additional the TBA incremental growth.

the results discuss quarter Refining segment. of let's higher the higher the valuation included approximately million. $XX slightly and of offset volumes Now LIFO planned on freeze. a turn the the Fourth margins of increased XX by December and third Results following Slide benefit to of disruptions maintenances, inventory the EBITDA

spread the at with the rate operated average Despite we barrel, In per fourth of Maya per XXX,XXX averages. historical remaining $XX barrels quarter, X-X-X increased downtime, an capacity to well above modestly the of day. unplanned crude refinery XX%

more Maya at January, strong heavy than In X-X-X for also unseasonally have by per spreads been discounts the crudes. strong $XX driven barrel,

We in refinery expect approximately capacity first at XX% to operate the the of quarter.

year in in at such Finally, the recognize of the is for I has with finishing achieved the injuries This X record would team recordable XXX-year refinery to time a the like this history our XXXX. first been facility.

and dedicated the Our we team exit is to until safely reliably operating these assets business.

to With Torkel. over that, turn will I it

Torkel Rhenman

Thank you, Kim.

let's well noncash the of Margins Advanced to LIFO declined $X million. charge. million Solutions Now feedstock pressured XX. Polymer valuation the and our costs on as by segment Slide $XX EBITDA quarter energy as remain review inventory results Fourth

that quarter, journey transform exacerbated customers' Volumes segment. fell by prices impacted a businesses. the on to demand high the fourth our In seasonal power embarked on APS lower European we

value for LyondellBasell. for development goal maximize to Our service to customers our our on customer sharpen product focus and is and

operating and with and With strategies. segment a media are developing agile meaningful autonomy accountability, more model we growth increased

part of January businesses Catalloy XXXX. reintegrated polybutene will transformation, moved from and segment into this and the APS As be beginning X, O&P the

shift This approximately move portfolio Americas very and focus APS view, of business, we $XXX the the APS to between our will a allow serves distinct segments polybutene, From on annual EAI the equally. chain. sharpen estimate which and Polymer point O&P EBITDA their business will team value of O&P from of Cattaloy million O&P compounding

our Markets platform team's of information forward this Capital look delivering transformation progress We our this has believe March. to and to in potential reporting a in on I change plan that the Day impact on during our additional in provide regarding lot March. strongly of APS I

call return Peter. With will that, back I to the

Peter Vanacker

To to business LyondellBasell Thank of on the you, team, the for delivering and the results year. during again close a Torkel. the And behalf thank Slide out turn let's Seward. strong our technology entire segments, for work in to discuss on Jim you all XX results hard challenging

the reduced by quarter, recognition. global to licensing in results timing as catalyst quarter for resulted licensing volumes, first segment moderating XXXX revenue. quarter lower catalyst revenue of improve, fourth due volumes estimate operating revenue industry milestones will that similar the the rates to During fourth be offset We moderated for polyolefin Technology the

Our to will advanced first plant. closing plant at LyondellBasell's mixed feedstocks technology on is and technology proprietary Italian most extract engineering commercial sale recycling team advancing by consumer leverage hard crackers. our This MoReTec waste work on the loop from for plastic producing

designs reducing innovative by advantages distinct through provides process improving catalysis. yields technology Our consumption, and energy

now me XX. summarize results outlook with Let first our and quarter Slide

on forward sharpening Most of resilient portfolio values. capturing our are deliver Despite targets, on we value leveraging our the is strategic to remain priorities. our results. on focus We team focused core and moving scale clear importantly, highly our LyondellBasell's

speaks ingrained corporate culture. safety depth Last year's in safety is which outstanding to performance our the with

foundations value to we our is and Executive Committee Executive welcomed more to goal Vice comprehensive creation. as encompass Our core Culture. week, a President, to People expand for petro passion Trisha our This Conley

strategy leading play vision elevate our culture organizational best Trisha inspiring industry. the most to the enhance and role create employee our a will in and and in pivotal LyondellBasell's experience, performance

our businesses from our pressured energy reduction and XXXX, emergence cash portfolio global and the with by maximizing business policy. the volatile We the In changing costs were war, by matching our generation. leveraging of demand, pandemic monetary responded effects

cash Over strong. commitment our and The Lander needs the carbon brand meeting businesses of the past dividends and formed owners and operations generated of remains our and $X on annuity business, circular $X.X society. from more year, over laser-focused shareholder solutions focus we repurchases. and share to in customers, to billion returned billion returns are shareholders

progress procure low-carbon of sources. substantial and made business our and address electricity well from science-based positioned to Circular towards are to decarbonization the Solutions sustainability goals Carbon The our waste. challenges is have goal of and Our Low plastic and XX% now with aligned renewable guidance, we XXXX

transforming we're can an expanding that and a building end-to-end valuable network, position technology we and By market. global robust with business confident leadership proprietary chains, build and supply manufacturing materials for this marketing and exciting in our large-scale

be the sustainable a platform for focus December, procurement sustainability gaining identification EcoVadis sustainability our were of the and EcoVadis professionals to recognition. awarded is percentile valued is in by Medal The on evaluation honored solutions. with In And ranking. XXst supply we assisting Gold for performance

of quarter the improvements modest fourth charges. for expect stable demand life and from feedstock the in first absence quarter moderating We costs, energy and

Normalizing supply Middle that North trade we our East. continue the ensure and global matched feedstock our from across and discipline chains maintain or to Nonetheless, enabling will are improved advantaged America in positions flows to operating focus portfolio to conditions. market rates

As seasonal demand and And quarter. the Covet half of second XXXX. third from and anticipate potential second eye we're year progresses, economic close China's during during keeping activity a benefits on improvements from the we the emergence increased

identifying exciting that and during most already, is as process some the for has The decisions a my initial substantial shared of first customers, suppliers, our shareholders compelling but ahead. building challenge LyondellBasell CEO over We've more with value decade. of next months communities employees, the X the you been much strategy generates and

we our us strategy person. waited virtually more right speed As all ask join we date York, until New share and details great have for Capital you we Day XX, in with have direction. the will March or Slide hope the XX, moving in the Capital recognized, save in you on can our that Markets at when but will forward and that Markets you On ahead focus we Day, started

your to now take are questions. pleased We

Operator

first Citi. Instructions] [Operator P.J. the line from question Juvekar comes of Our with

P.J. Juvekar

Yes.

the make venture terms there? joint quick see -- maybe inventory And you on Bora China reopening. can in China in where ports? comment the then at rates and you with what question operating were do of had a China a What you Just on your

Peter Vanacker

is This P.J. Thanks, Peter.

first take say to also we to China, potentially me and still then see that. early it's add When your a Ken about recovery. Let question we talk can stage that sustainable

recovery until mean that, actually probably see another happening. take X, We X -- I is that expect that will we months

know very still on there expectations that opening. So the we in I our modest has at least, China. mean, we're But been

-- that I to So how look COVID. changed at has government the at their way. mean,

very And capacity because and rates of positive because technical locally hanging of market Bora, Ken? in situation there, say. at in I being the still Not the would utilization minimums.

Kenneth Lane

Yes, that's right.

to We've going challenged. venture in a to weeks, continue. it's to but that early continue we're in -- too two joint be bit demand, technical minimums. really operate Margins little seen improvement continuing of the consumer far are to of that's We seeing say

red So spread there we're seeing still. load

that improvement of So yet into spreads. improved not demand, even with it's translating

-- that very So watching we're closely, course, P.J. of

P.J. Juvekar

no polyolefins? is PO the different on situation situation the on than And of

Kenneth Lane

Correct.

Operator

question comes the of Our America. Steve with next Byrne line Bank from of

Steve Byrne

EBITDA quarter? in cash to a fixed EAI cost XX% Is result of absorption the just the margins segment into the were I here. drill running in loss-making just at the region negative the wanted or of

XX%. do lower lower you And rates that operating others Ken, Do you risk Or to remain energy margins stable? restart that mentioned demand that XX% and sufficient improving. of see Is will given you well? with may think drive from as to costs

Kenneth Lane

on Steve. to you, add, of the also -- question. the other question mean, costs. Good I aspect I course, your would energy Thank what to that And is, you

know, on you moderated high still have mean, energy level. I also very As a costs

[indiscernible] so also but very the the in at moderate expensive United least, winter at peak helped factor has by far Europe. versus been X we're that mean, of them more I anymore not that States,

-- hand over the market bit give to mean, color to more a to in would So is I I happening Ken. what

Kenneth Lane

remind And $XX of have did you. just to that quarter we LIFO in million. fourth charge Thank the Yes. you,

a So were point low looking energy coming because fourth at hit -- was costs but high. we the what very of coming demand quarter, see out there we off,

quarter, They seeing the that moderated the we're at the and quarter. end first continue in of

fourth [indiscernible] our down also during We fracker the quarter. had

early. to we consumer it's say in in Similar we're still repairs the So I is improvement -- China, seeing back lower. what see some demand. But rates our complete, that's why again, operating were Those fracker are up. would

it signs consumer Let's early there. definitely but demand seeing win a improving we're some not call yet, of

had Peter margin costs. the overall, to So is the of environment said going energy because around mainly what improve

Operator

of line Securities. Our comes Parkinson with Mizuho Christopher next from quarter the

Christopher Parkinson

been [PE] operating NGL feedstocks? progression give and the latest on that for give just across means generally integrated us margins you just throughout what the and your update what's your of Could just Could regional you front outlook rates year? on NGL happening and various Great. the

Peter Vanacker

Thank Ken, want you you, to? Chris. do

Kenneth Lane

Yes, NGL production continues take I'll Sure. that. to Listen, increase.

tailwind, to -- be our that going in continue So ratio be continue is to expect for gas here be for our we especially portfolio. or America. oil a North to The favorable position and

We some don't see that expect oil year as could the really we back there potentially reopening. be do through changing. strengthening just comes demand with China in We as go price the

So all in all, in year around last I would say that than synergy the our environment half we where today of feedstock second in should be were better the portfolio.

Peter Vanacker

nat [indiscernible] mean, was think $XX where XXXX. I to And to I of gas, first the half back in it

Operator

Capital comes Our BMO line from Markets. from John next of question McNulty

Bhavesh Lodaya

Lodaya This is Bhavesh John. for

You operating in in America North rates first quarter. the highlighted improving

on we of we domestic think there? reducing out levels, depends rising some further of like of do expect? recovery demand about growth in XXXX, constraints type As then you historical the that exports as U.S. much and what rates like think a how back about And logistic operating to

Peter Vanacker

will a to continue for still being very expect at to very we being least which of house are up foreseeable needless to be rates base, course. builds say inflation when for broad It's -- future with go to high that that houses low digest high sold durable clear yes, try goods goods it's me with put continue rates, depressed. about mean, I I to in that the mature that buckets the and still it a with the talk demand question, here. very we interest different for new demand mean, let

strong. seen in goods the we stable, cycles, not on What in that seen hand even have side, I is certain relatively as to other for say, we is other nondurable mean, have areas, demand

that given now utilization. this have So that we fact I we guidance Americas that are has mean, the say, led XX% at to in we the operating

we up turnarounds oxide a of we able of was already periods grow Stock the utilization you that overreact at alluded not mean, is talked year. currently last -- we'll mean, scheduled a I the starting rates, mean, end I XX%. because about which In have at let's the a sands, the Ken Kim said, this but and higher our a [indiscernible] have when to add, more I XX%. but of Also quarter, at course, bit to as starting the than which to I&D, start-up of we either European up, volumes facilities. the know PO/TBA at we will propylene moved the end bit, that shutdowns, was here, on we be of tick have, it that operating new assets are And

Operator

of comes next the Jeff Our question Zekauskas JPMorgan. with from line

Jeff Zekauskas

and A it you that that have of end is, the shutdown get think the fourth really down? shut refinery about you year your When at of are of the XXXX? prepare it does two-part question. you to mean XXXX, the That down operating shut the there or quarter reduced to rates in you do to end of

sensitivity to price changes. a natural Second you question gave gas is,

MMBtu you XX% is Europe. dollar You said [$XXX per And in is said every million].

XX $XX. an European year, is that's it million maybe $XX The MMBtus. So MMBtu. averaged And roughly price last today gas

$XX. down it's $XX million. So times XX, $XXX

if relative the done XXXX Have calculation for are they where benefit gas the I last Europe that correctly? is stay prices to year? So in

Peter Vanacker

as by shut to said, Very down you, have about refinery XXXX. mean, questions. the we want we refinery, the talking Jeff. mean, I good the Thank end in I Houston of

So in in that the there preparation has for be course, that year. opinion. be to is end the free The And some has changed either. needs that rationale our to not order of hydrocarbon changed by of not done

on add that Kim, something you to So want question? if

Kimberly Foley

working to plans detailed that through tell how just would of audience we're the do that. the I

the and through year], by we're you clearing we on alluded, shutdown have just with the do the do the slow ramp different effective pulling scenarios working you that a that plug can As efficient an you sure that make down? XXst to to Or most in going are process. [of the

Peter Vanacker

energy if your hand to also just hand that surcharges. done conclusion. up our second the an one on increasing not implementing that course, forget the prices side, let's But Answer do you job make you then on side, mean, by have Europe, of excellent other I also question, math, in teams

can't actually the you did, you way So that net Jeff. out

Operator

comes from line Fermium with next Mitsch Our of Frank question Research. the

Frank Mitsch

Investor on is of fourth uses a coming quarter. in Congrats, made working the down What on are Magazine expectation resumption you what is and deserved. the buybacks? David Michael here of capital XXXX. recognition, your wondering CapEx Michael, breather cash, of progress thoughts a and I'm Institutional in 'XX. XXXX, well for the there on buybacks terms in in in terms good was of And the

Michael McMurray

So good question.

the just working Excellent extremely perspective I'd businesses think, So by year. cash during that the from execution -- in was out again point strong. capital I mean first, I the I generation XXXX a

In longer-term well. of the that, year remain unchanged. allocation fourth forward, and priorities foremost, think, perspective in this as capital and I first say quarter, Kind to looking would I turning our particular,

know going that that strong and have we to specifically cash to returning flow would be point all generating our CapEx reputation about XXXX, to gain materially. Thinking flow shareholders, I cash not expectation and a you And is for out that has changed. down

expectation So expectations second this X half for an tale year gets capital It the of for be is with about going that a is to $X.X halves stronger. billion.

actually towards consume working working here some sales move flattish. it's capital I first should my and capital as hope look the be with As into quarter, pricing. balance better of better the we year, I the expectation But that to

with starting are investments growth as dividends our of remember, then particular, in PO/TBA. pay start-up And to well, the

But I'm dividend. return shareholders, nodding my and our recurring as expectation, we including growing again, the think continue me. so I full at Peter and will at to year, meaningful about looking And he's cash it's to

Operator

with from Morgan Our line question comes the Vincent Stanley. next Andrews of

Vincent Andrews

demand is also their to give Could view to during helpful. will if market? sourced be on how back a you from Shifting And of anticipate reasonable outcomes need think would of that you out us polyethylene XXXX, ex-China had for growth XXXX? in be range you a the much what polyethylene. growth demand actually turned Chinese be And that you what to

Peter Vanacker

Yes. you, close already to Ken Thank Vincent. is that.

So...

Kenneth Lane

for you that. China in the Look, the close been very are relatively years for we polyethylene X last is our flat. Yes, for demand view question. Vincent, has to thank the

significant a that, it guarantee. range snapback that's outcomes if but look you XXXX, in doesn't So years a when to would expect historically, of talk you see X growth, for a about after like mean that you

has see That's markets we It's could some of new very the one the closely But to to more absorption because flat watch in the of recovery the are is closely just hope it come plus and we'll capacity you largely all drive X%. watch anything very and price will to hard come. see from of that's that near that call. the future the why So And it to on. in signs market. that more

Operator

of with KeyBanc Markets. next the question Yefremov Our from Aleksey comes line Capital

Aleksey Yefremov

a long-winded I have question.

-- there's has there's thesis So anywhere and ethylene export much advantage, advantage. cost polyethylene necessary. almost can a due to as long-standing to U.S. the And cost that U.S. as capacity world in

and happening industry lower utilization. of the now, It's the not rest right? You has what's right capacity

economical So Is increase export? in that why logistical it limitations an is it? not or there not other allow don't

And a as go could go as rates this due imbalance result? utilization domestic exports the there's market we up XXXX higher to your change in through and no that such

Kenneth Lane

quarter, the as during an -- We've but both question. that industry increase exports. in did take well I'll see Ken. as we actually is in an LyondellBasell this Alex,

improvement some into some demand that less coming the overseas, imports to of regions. Some from was South like of related in closer America some markets other

dealing we year, relief those in really up the in quarter. also first quarters of it the started were to with of logistics [indiscernible] X of fourth the that constraints But free the some

exports start that more and see continue in that the get we'll think first going to you're XXXX. I to quarter for a normal level to back So of

Operator

line Our Michael from Fargo. next question Wells the of with comes Sison

Unidentified Analyst

Mike. for on Richard is This

program. the enhancement to touch value Just wanted on

You've details million buckets coming the just But where then details savings are the we're more probably great. from? early to able for Markets I identified would through call know to Day. terms of And XXXX. you've savings the on identify are in be on year any also of get of what $XXX in going savings this the cost cadence

Peter Vanacker

beginning sites United I next speak in also year -- Europe. as States. you, And the mean as as Thank The sites -- the sites enhancement since is in say. program mean, major now X is to of Good question. United major up both done I value the in Germany. other Yes. Peter. ramping I during quarters, the impressively, process in This the the We're Richard. the must quite well States expanding we We've actually the

excellence, mean, areas projects than that from manufacturing chain identified goes, so to it commercial management. been side in X,XXX more And supply I far. have the procurements to

of very a it's portfolio broad different projects. So

it during a We will to the examples Capital make Day give couple of tangible. Markets more

to that stage we very the focusing Today, based prioritize a the and seeing on continuous so if that is process at mainly where not are have returns we continue much a is based projects projects we which we where capacity, in are look fast payback you time, gate upon the projects and that add upon what it have, market increase marketplace. but logical is,

XXth would the tuned, say, at more Day. the Capital stay I of March of couple on So get to examples on a Markets specifics

Operator

line of Fischer next comes with Sachs. Duffy Goldman the Our from question

Duffy Fischer

contemplate I for for or questions. as polymers One, plan, across the between the operating next America? do have what's you rates your segments, QX? percent versus also that improve North quick capacity you or your year the to export in of kind U.S. for export split year? meaningfully sold increase the does summer as the what Americas, some sell-through in this see season? guess, on in Or build Do does that -- that for then and -- new well Two inventory with your And

Peter Vanacker

mean, split on Thank X parts capital it on working let you, I question. Duffy. your inventory in me question up the

also about PO Kim First Kim side. can bit And of give overview will talk then of the olefins, all, a polyolefins. the on

Kimberly Foley

Thank you, Peter.

level which side, of startup have as yes, oxide is capital that the once bit expect And propylene working about in now. confidence to the successful, come we operate based on we down. modest throughout a the XX% relates slight it as we inventory building demand contingency the year will the oxide But to we're at see a startup. So propylene in right capacity for a tremendous

Peter Vanacker

Yes.

a in producing be quarter I flow the and want echo cash It's to to that what able our to talk customers. outstanding the and I with assets just deliver maximize teams an we So Michael. need have to about fourth the managing little job -- on products bit done O&P, really focused

and that increase working that, I'm we're stronger going capital, in and manage operating We'll everything going that quite will taking a that's may Michael we a the as a continue result. to rates up to markets but which to as that as did end But just to forward very that have they see match improve, because time. we thing team said, proud during business was markets our of do difficult a quarter, the good fourth

see in to coming exports, think, an to in just your on. from going we're market, with new exports, increase or general in from the To Coast increase continue all around States I to United question the market Gulf capacity the

increasing the a assets. that we continue portion going ramp us as have the see to As hypers new been happen. up capacity the for We're we exports of company, to with

But around value clearly, tends to customers market find and and segments home. closer to our to the strategy highest channels that to is be

trying and So really find we to exports we're the the to more business always portfolio. here use optimize

Operator

Our with next question Vertical comes from Kevin Partners. Research McCarthy

Kevin McCarthy

rationalized spot you while have of up prices come though to has extent. producer export U.S. some contract polyethylene year-to-date, your as seems view discuss appreciably the Can pricing opportunities inventory been

see turn move that start as through what So confidence corner will and contract quarter and currently you're perhaps seeking you your the prices to first can progresses? level the higher talk of

Peter Vanacker

clear the hopeful there at continue the in a U.S. these Well, marketplace. Kevin. And least that we we're good there is market. price development increases, Thank it's out that price increases in you, have see Ken? to we

Kenneth Lane

Yes.

in we've So we see market year. did seen that last look, I'm export strength the confident not

And So on down call, sort those pricing. think indication. of the mentioned third quarter I export that's I we've all to this with seen earnings prices parity good a come

should increases exports the confident prices you quarter, going see up, go and we're some moving first as here. see you domestic So I'm up, then to see

Operator

the Joshua UBS. question with Spector from line comes next Our

Joshua Spector

comment I'd I maybe million normalized curious to prepandemic, I $XXX move even synergies earnings Just mean, if business think on on Schulman $XXX got $XXX million million that. used the is what want residual, about if like be $XXX you some be on you've residual just you and there's residual. in that million, -- top of of over, looking APS, to

could you some there. if give us curious color So

Peter Vanacker

costs to the well Definitely business this LyondellBasell. APS is add? are, separate the costs reposition decided demand are they there as -- cost the you of one [indiscernible] last this to within that on reasons happy business. in very not with therefore, we lots seen roll run results mic a good question, all company market year, energy repositioned and we APS higher so this factors Michael, business. feedstock of And have yes, Josh. we want as have we And have that And because like of course, why do it at

Michael McMurray

This core [PB-X], to APS, model new taking, O&P our we're or -- I solutions very first, lead the bottomer of or the lot Peter, customer I have owners business value-creating polybutenes solutions this to enables fit where the the compounding be a that can and think potential really express embarking deliver. want a Catalloy through the transformation it OEMs. view that Yes. in really and brand focused the to [indiscernible] place opportunity see I team we're to we're And in that steps say I business. just call a segment. this Advanced of And on. on we for better excited as the in that and And I new, put I'm what and that

transformation did well now more on the cost integration the much we reductions, and I'm We at And And the forward to up. with intimacy, about to a operating Markets of Day grow business and us will this coming customer improvements the in but support going it that customer-centric in business our part Capital are think And way. profitable to focused model. this our I looking on journey more APS is levels it needs a technical really journey embarking this and share transformation. service allow be fix

Operator

with the line Deutsche Begleiter next Bank. comes of David question from Our

David Begleiter

receiving premiums Peter, are you’re types Circulen of on and the what your what volumes? Circulen on volumes, margins price these are realizing you

A –Peter Vanacker

of question, Good course. Yes.

entire go we an recycled have circular portfolio, part the of the either a which the is have we portfolio, with As mechanical markets or we portfolio, part into advanced the recycled. reasonable of so

the aspirations market give mean, have Capital up the entire will go-to Day strategic insights with I in this business our set during more that Markets units, also in market our with we family. are We having Yvonne the by –

market than higher supply a substantially the is the is which short. this Currently, is Demand in market. extremely

we premiums are available. The we quite in sold completely getting out we’re So products are that the that have attractive.

Yes. to put we speak. it I’m as on not going number a

calls. Capital Markets mean, That we And the said, Day. we numbers, from least more are the other heard on I that aspirations that insights level. have can be on will at during You’ve I say Yvonne

Operator

to Mr. gentlemen, our floor for questions. any and for turn Vanacker the I'll time concludes back Ladies that allowed comments. final

Peter Vanacker

will Thank advance on much, the you we unlock March substantial as very coming XX I will our and and once you very that questions, good again, then on share And LyondellBasell how will questions. us thoughtful Very strategy hope join thanks again. over years. value

have As waited we call, have prepared not until Markets we said in for this the Capital Day. comments the

of all our into already put new Day more wish action. stay on a Capital the specifics the as to different is you weekend, of great have strategy. the of things Markets lot into And purpose go pillars We usual, and the deeper safe. a I

Operator

you. Thank call. today's This concludes conference

disconnect your your may participation. you Thank lines You time. this for at

LyondellBasell Industries (LYB) 3 Feb 232022 Q4 Earnings call transcript