LyondellBasell Industries (LYB) 27 Oct 232023 Q3 Earnings call transcript

Company Profile

Participants

David Kinney	executive
Peter Z. Vanacker	executive
Michael McMurray	executive
Kenneth Lane	executive
Kimberly Foley	executive
Torkel Rhenman	executive
Jeffrey Zekauskas	analyst
Patrick Cunningham	analyst
David Begleiter	analyst
Steve Byrne	analyst
Matthew Blair	analyst
Michael Leithead	analyst
Frank Mitsch	analyst
Vincent Andrews	analyst
Hassan Ahmed	analyst
Aleksey Yefremov	analyst
Kevin McCarthy	analyst
Arun Viswanathan	analyst
Joshua Spector	analyst

Call transcript

Due to licensing restrictions, you must log in to view earnings call transcripts.

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'll now turn the conference over to Mr. David Kinney, Head of Investor Relations. begin. may you Sir,

David Kinney

and all everybody, call. joining thank day, for you today's Good

is website we would presentation a and I the accompanies on to call Before discussion, that like begin www.lyondellbasell.com/investorrelations. at point out today's available our slide

subject uncertainty. to and to statements more useful reviewing risk results, forward-looking available and you reasonable Today, significant to We lead our making alternative also learn assumptions, are slides cautionary to financial on about encourage We and could some our our Investor that our statements the statements which forward-looking website. are regulatory in non-GAAP reference believe presentation and the while the differ factors the we the to actual statements are filings, discussing the results will by Relations measures. be are investors. business Nonetheless, forward-looking based measures upon

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

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

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

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

will outlook our market we long-term focus strategy. third on During current near-term quarter and dynamics, our today's results, call,

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

Peter Z. Vanacker

welcome we our you, to joining Slide today We quarter us of as you X. third results. discuss with all David, you. Starting appreciate and Thank

today's call. messages key We have three for

LyondellBasell First, conditions. resilient market results to challenging generate continues despite

deployment capital approach thanks our and share display, teamwork, we quarter. we balance assets great during on investments bolster able was repaid And rewarded cash as our to funded dividends delivered time, sheet. the maturing maintain to team the through exceptional cash and conversion same bonds, to and on the shareholders Our our balanced full grow were At repurchases. to

Secondly, executing our we on remain focused strategy. long-term

recall built strategy will our You three is pillars. that on

pillar first upgrade our grow commitment with that core long-term aligned our The strategy. reflects to and actively are the businesses

our in oxide the We & facilities, propylene Derivatives successful through of train largest are Intermediates segment the the plant start-up our new single world. growing PO/TBA

the Intermediates to from In EBITDA for in a segment. on contributed minutes. for this few strong provide Kim more quarterly third our produced quarter, extremely details PO/TBA oxyfuels a record-setting assets our margins & Derivatives will

about direction. The we close other not well to units Brindisi, upgrading are half known. September, site and Italy. and in And assets involve the of one with do difficult In businesses and fit our intent plans core of the our business very growing refining transform long-term decisions to exit two our announced our really that production our polypropylene

business our the business. pillar examples other. our the managing assets of strategy, businesses profitable support of resources and pillars how our that reinforce of of strategy We're to a while portfolio These and each actions our actively low-carbon second the core, reallocate solutions circular building are toward growth

XXXX. We of recycled continue to in renewable-based XXX,XXX marketing or make producing ton-site good over this since area, progress and polymers

advanced plant catalytic Germany. our Laan webinar forward MoReTec recycling As looking month, Seward first later commercial on this and we're investment a final Yvonne discussed van in quarter our in last Jim der to decision

Houston in Dutch integrated And a companies, sitting infrastructure in capital we venture just joint a past circular venture ventures also the in announced and plans plastic renewable different an recycling support plastic a that stake are Spain. few circular still, agreement fund not we've here for joint plastic weeks, waste in two in feedstocks in our supply electricity solutions recycled and a and and low-carbon

program announce track for that exceed pillar I end recurring VEP rate strategy, third of culture. aligns $XXX our is Our performance to value target with to of by enhancement the million our EBITDA the XXXX. our stepping on pleased our in annual am run up and

our last grow our Capital phone profitable As and of core, quarter, Markets we game-changing a The while our new reminder, in business. VEP building solutions million, VEP and million we at initial value $XX by target by the our Day our that $XXX March. target investments increased supports to a circular low-carbon from unlocked announced

strengthening today business and that LyondellBasell's company to strategy future. into our ensure is is to focused well our positioned the message key portfolio third value is My capture

the competitive Our impact of these core future of competitive provide track record all maximize leading on that sharper positions operational growing attractive a can markets advantages. innovation excellence focus management, excitement LyondellBasell. returns, I with the our for and businesses in you benefit of With we share effective hope from cost advantages.

X.XX, discussion their for remains safety the our for and and the incident team our operations our performance for safety means the to year-to-date rate our congratulate Slide above with success. values I to cornerstone employees and outstanding to which contractors LyondellBasell's top Safe for XXth to want provide turn begin leadership industry. is and future that fundamental percentile performance. commitment performance. core Let's X our our safety are foundational

and X to financial turn Slide summarize our results. Let's

available $X.XX delivered billion resilient positioned quarter, EBITDA was At well businesses During billion. from end diverse our the the were liquidity. results of Earnings $X.X and third and the cash $X.X with generation was strong per cash our operating activities share. quarter, $X portfolio. LyondellBasell's of from billion,

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

Michael McMurray

Please that by record you, sheet Peter, we cash strong turn morning, and of shareholder to me track good everyone. balance X, are and and our Thank begin efficient how investment-grade conversion Slide supports extending returns. our let describing

balance end the quarter, the operating cash At X the quarters, activities. third billion $X cash of past our of During billion. $X.X LyondellBasell generated from was

over of cash into XXX% team the EBITDA Our months. XX last converted efficiently our

with capital investment to disciplined strategy, allocation X during our LyondellBasell returns the our strong continue supports long-term review Slide Let's details and quarter. our remains deployment while for shareholders. balanced that third capital and of the providing committed in

During businesses of of our covered cash conversion in expenditures, down million portfolio to from Robust generated through $XXX enabled third and activities. comfortably billion maturing $X.X capital quarter, return paid cash operating dividends the and a shareholders share repurchases. bonds

and our actively As portfolio. our Peter businesses, on while our team focused is growing upgrading mentioned, managing core

maintaining our are our With as existing projects focused asset of across capital and reliable operations PO/TBA and business our building and solutions as investments assets, profit-generating base. low-carbon in the now completion circular on a smaller profitable new expenditures safe well

$X.X of now provide I of EBITDA quarter. on of overview the third each would business a during billion our like segments LyondellBasell's to brief from the X. portfolio delivered Slide results

and exceptional Results reflected both margins olefins in from in our and fueled pressured O&P feedstock challenging margins businesses results Our capacity by record that quarterly very oxyfuel lower industry markets. higher cost, segments. European in were by EBITDA offset polyolefins conditions I&D, new

last in earnings exceeded from third segment. second primarily EBITDA that call, our that led expectation expectations, Subsequent our shared our we quarter our events I&D In results quarter results. to would decline

increased industry at During Coast the XX% assets triggered that relative I&D several Gulf the across in EBITDA August unplanned margins quarter. into and a by to oxyfuels second downtime significant improvement September, U.S.

expectations. slightly, exceeded company Our but the clearly our third end decline of quarter EBITDA for upper the did

to working to market align our with continue operating We optimize capital. demand rates

fourth rates for American XX% assets. the our polyolefins During polyolefins XX% North derivative European our expect olefins and we quarter, assets, and operating XX% intermediates and for and olefins of for

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

Kenneth Lane

Michael. you, Thank

discussions for segment the segment. with performance on and begin Let's Olefins of the Slide our Polyolefins Americas X

EBITDA Americas export polyethylene flows prices conditions. were polyethylene continued be September. U.S. million. price support and was O&P $XXX higher feedstock to normalizing toward slowly in polyethylene margins costs volumes trade helped Increasing pressured and August increases contract by quarter Third both oversupply. Integrated and pre-pandemic Global to appear

pricing polyethylene quarter, strength. continued the we volume stable domestic and In export fourth supported by expect strengthening

We potential expect polyethylene headwinds market. volatile additions The entering U.S. feedstock also market the supplied recent and energy well costs. capacity with is from

on capacity our polyethylene. is X/X approach North We disciplined LyondellBasell's high-density Roughly LyondellBasell's with rates to America remain match of polyethylene market focused demand. operating

are high-density falling September. the So during polyethylene across pleased to we see inventories industry

the In Fund. Odier's capital in solutions, from companies support to pollution in reduce circular engagement and growth innovative investment we announced comprehensive collection, of of of Circularity recycling investing aims feedstocks. value collaboration Lombard low-carbon improve sorting and offering fund in and waste. solutions to another by to our Plastic across our The example plastic plastics increase the chain of This is a recycled fund availability venture the

our in nationwide aims between announced solutions low-carbon plastics. support venture of and waste from a LyondellBasell, investment hub materials landfills area. at Cyclyx, economy week, of this recycled Houston a integrated and plastic the to provide the circular accelerate more to infrastructure joint build collaboration The development plans for and an we our to Agilux, circular in capture in Just and scale ExxonMobil

of the and naphtha turn Please Polyolefins in the loss continued an weak to performance demand, costs Europe, Asia oversupply our $XX quarter, EBITDA In of review and our International million. XX impacted third segment. margins, higher resulting Olefins Slide as European we and

costs. expect European higher approach tailwinds Chinese and remain to seems increases, normalizing be anticipate The challenging, we some will weak for return that demand offsetting markets trade price energy likely of global but demand We As year-end, we feedstock flows. to polymer modest with slow gradual providing persist.

to during advance we strategy. quarter Finally, took several the steps our long-term

made the our improve our difficult focus two to of close on of we core our assets part decision Brindisi, As assets businesses, to polypropylene and goal Italy. in one

recycling acquisition of We build and the efforts production resources. expanding two circular support Both and stakes DePaul involved products. packaging processing also the companies Dutch announced plastic companies, waste in are of XX% different recover in sustainable out scale sourcing by and of the snip our our to

XXX rapidly In electricity goals, gigawatts power renewable in LyondellBasell XXXX over agreement XX% wind Spain. of agreements. signed line purchase solar of target capacity electricity achieved for a and With renewable for capacity this, our has generation we solar under with with of sustainability our megawatts X.X

and to would actions like quick decisive advance our recognize strategy. for our to their I teams

will I turn the to Now over Kim. call

Kimberly Foley

XX at turn $XXX quarter EBITDA as & Please we segment. record the margins million. Intermediates Exceptional look of Derivatives Ken. Slide oxyfuel in you, resulted third segment Thank to

quarter, oxyfuels production blend industry unplanned to U.S. higher led oxyfuels the for on Gulf premiums for the to downtime During relative gasoline. Coast

during When resilient the raw expanded margins our America oxyfuels business global higher cost in and third capable diverse through for an quarter portfolio of prices providing coupled our cycles. results example materials, performance business outstanding market is oxyfuel low oil of butane The Europe. is and how of with significantly relatively North crude

our oxyfuels our PO/TBA portfolio. capacity global of our as With new as large LyondellBasell's polyethylene diversity capacity, growing is American asset, the highlighting now North

approach planned In and U.S. to the match each oxide Europe our were by disciplined new asset. demands volumes market from at during asset actions conditions. the with the approximately idling assets rates of for offset largely propylene challenging months in the production POSM additional reflect derivatives PO/TBA and business, These two our X

Looking end margins we during ahead, from planned of cause half and the the two the to costs are the the assets. our in towards expect fourth at driving maintenance we seen season our moderate oxyfuel existing higher first of guidance of year, of In levels quarter propylene with line conducting the beginning XXXX. will butane summer oxide

We expect quarter. XX% assets global approximately fourth capacity our at I&D run of to in the

fossil-based the our their oxide, with carbon our and for and our customers renewable provide expanded range sourced with brand targets meeting offer than from the products launch we other lower +LC styrene September, In products These a gas solutions. of solution recycled footprint that propylene of offerings sustainable and emissions are a alternatives. low-carbon greenhouse of feedstocks

Please turn asset. review new and progress PO/TBA to the our XX, of Slide let's

the As upgrade is our fit strategy long-term Peter first and that businesses strategy. pillar of in our to core grow earlier, our investing by mentioned

part Our of in that new growth. asset a Houston, key Texas PO/TBA is

largest widely oxide asset propylene highly Furthermore, LyondellBasell's more capacities to the This technologies. other and XX%. relative we single-train world's believe PO/TBA is oxide advantaged technologies propylene facility than that oxyfuels global increasing by are used

propylene the By our lowest operating advantaged And assets strategically the and cost located had technologies benefit oxide. and producing lowest carbon feedstocks. butane PO/TBA shale U.S. the from our for propylene Coast footprint analysis, Gulf

injury. test of a to is detail these work more our and part PO/TBA X plant During capacity manhours associated out facilities. success. of start-up, our a commissioning X months recordable we the new achieved the the and This key attention full start-up safety without completed the technical relentless we acceptance than of prove focus of Within on of the assets, to million the

assets, ramp-up but the be largely at to PO/TBA will in see contribution new return. beyond from XXXX PO/TBA our maintenance durable XXXX, capacity the asset planned by expect new In in volume meaningful as existing offset the our for goods we demand and more

look and has team our what these to forward reach of quickly proud accomplished incredibly am to their I milestones success. continued

let's to the discuss turn Slide the and Now segment. of XX results refining

million. impact a Maya was distillate offset the EBITDA a in mark-to-market hedging quarter benchmark Modest by crack X-X-X program. improvements were Third spread $XXX from

use risks. our risk efforts, to part As derivatives commercial ongoing of will occasionally hedge management we or financial

the attractive resulting margins particularly expectations, hedging September highly were through in relative During for our cracks, refinery in our levels. cracks to third portion our output cracks, And favorable lock distillate XXXX. of losses Distillate distillate the outperformed refinery took program. we to for mark-to-market quarter, historical in opportunity a

expect In the near million in with refined Maya catalytic quarter. are products the our the cracker, seasonally term, X-X-X demand of on an spreads executing fourth impact EBITDA we slower estimated decrease. Currently, $XX and to for planned maintenance we

XX% the of throughputs We capacity quarter. in expect crude at be fourth to refinery the approximately

high quarter through new transform the with of on than our first of no and support low-carbon circular site remain as strategy. safe in we to end We the to committed XXXX, assets of these focus of later growth reliability, a develop solutions projects the the operation

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

Torkel Rhenman

Kim. you, Thank

Let's results review quarter Polymer the for segment third on XX. Slide Solutions Advanced the

$XX our metal quarter lower and Third demand. decreased quarter This completed incremental in million. to from mostly the EBITDA offset sales partially acquisition for due by July. mix volumes was the was Margins

acquired to In pipeline now the are metal for our is the with increasing expect focused be product from in And developments With existing businesses. to compounds our customers we footprint. newly our recycled asset of fourth restored, refilling growth sustainable highly making team most and demand on quarter, customers our business. technical APS our across progress assets the third solutions levels number service our from the quarter to for across high-performing we similar good

make look goals work year Our we are Day as this in steady expectations but Markets and towards way for forward modest, last discussed the our the March. their to XXXX, mature begin we projects improvement bottom fourth pipeline at the Capital to of growth during as to quarter we the our line

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

Peter Z. Vanacker

Thank Please behalf on to you, results segment discuss XX, of Seward. for Jim Slide turn the technology Torkel. I and the will

Third the quarter, higher will unusually results. In licensing be volumes milestones and and quarter associated we expect reflected that improved with EBITDA of million decrease. fourth revenue revenue licensing will catalyst $XXX low, catalyst

XXXX. we full technology As approximately a million EBITDA $XX segment XXXX full will result, estimate that be year than year lower

our decision scale we share end commercial a the are the final recycling quarter discussed hope year, in MoReTec fourth technology telephone this beginning catalytic advanced of call, of this before As a more our targeting and conference. investment for plant using to details in

and market end I Please turn XX, by and near-term to will discuss regions outlook Slide the markets.

As we will that of the conditions challenging remainder and XXXX. from our into business market year the through you expect heard leaders, persist

quarter expect fourth year-end we addition, from holidays In seasonality associated typical management. inventory additional with and pressures

costs will increased expected is demand. pricing be higher polyethylene by Americas, market supported the constrained stable exports by feedstock polyethylene In Integrated margins to and and be likely capacity. new

feedstock rising demand, challenged. continue with margins. compress coupled likely to energy We highly expect market will remain European and are markets to that Weak costs,

some supported consumer and for slowly is initiatives consumer benefits. be seem targeted China, and markets markets. packaging the markets, providing end to In by our demand limited stimulus are industrial but slow In steady, packaging improving,

customers However, keep their to levels our low. inventory continue

Science and Building United markets Infrastructure Law the Act, the benefits Reduction enabled Chips but watchful the & are slow, for Act. in and we're from States, construction by Inflation Bipartisan potential stimulus the

has We to our will yet expect continue demand affected results. UAW from gain not The automotive strike momentum. production materially

averages, inventories the and are end end the of summer seasonal of similar declined from above to have the are XXXX. remain expected risen gasoline on to first driving remain half inventories the season. third expected averages well margins records a with quarter of Oxyfuel Distillate low to historical to but level

to We will rates optimize in remain step with operating market to demand. continue our

industry part cash repurchases and XX. balanced billion me our feedstock enabled us let Now to $X.X our and & new which costs strategy third higher demand. was by in dividends $XXX but Cash our Intermediates capacity, long-term margins oxyfuels from and pressured soft as of from summarize for enabled operations, the O&P to amid quarter, allocation Derivatives Slide the outlook approximately framework. our in with record share shareholders capital margins were company with return results generation outstanding, Exceptional stable segments. million

Looking we to confident we ahead demand challenging seasonally fourth markets and across businesses, proven in to the quarter, navigate our softer but anticipate our results. ability remain deliver

Our team will through remain value to pillars continue focused of the our strategy. creation on advancing three long-term

with quarter are our from assets, third our core. PO/TBA new Our capacity we benefits and growing demonstrate results our on core our portfolio business by upgrading the focus improving this from

noncore and are assets We from resources businesses. reallocating away

support comprehensive the we benefits we the participation a and to profitable approach At where business creation. our transforming up business, embrace to low-carbon building And from LyondellBasell comprehensive the value same a down culture model time, rapidly to performance are and are value circular and solutions chain.

accelerating Our unlocking value program is enhancement an pace. value at

And of EBITDA I annual rate am recurring XXXX confident we $XXX will exceed million. exit our run target

We laser-focused and our for sustainable growth in LyondellBasell. a profitable goal more engine deliver to are

pleased we to that, are take your questions. now With

Operator

the of Our comes Instructions] [Operator first line Zekauskas with question from JPMorgan. Jeff

Jeffrey Zekauskas

Can in question. fourth? into and repurchase Bora profitability back I China? that's minimal share How talk the think the joint and Do about? think two-part a repurchase between of bought your that And venture the in A quarter was changed of have weighting you quarter, course the you number so of third why Or dividends through small? you the shares. share you about a

Peter Z. Vanacker

you, much on to Great. questions. has I your previous Jeff, compared the pretty changed situation quarters. Thank Bora for not mean,

add want minimum at run capacity. to continue We you do something? Ken, to

Kenneth Lane

signs of the which have there, just are turnaround encouraging. we impacted the some what Jeff. in quarter, domestic asset did is is would that third I market in that say growth the Yes. seeing a we But

the But not be market that is of see, approaching breakeven new of in still very levels EBITDA, capacity. challenging needed which asset the to absorb still to where we rate is great is However, all but a to growth China.

Peter Z. Vanacker

capital with I changed. has also to allocation mean, nothing with here, And buybacks, Michael? regards our strategy, regards the share into

Michael McMurray

sure, Jeff. No,

what priorities So unchanged. would I allocation capital is remain fundamentally say our that

particular. quarter, performance pleased our cash flow really this think in with year I and this

I to good think able this as the really execution. operations of that with quarter amount of we're take well. out Pleased capital working

our I again, shareholders looking said intact. forward, remain then And to commitments

this think by previous been demonstrated I actions. our has

communicated we cash that that flow, for free XX% know payout You target stands. a

That said, on don't put autopilot. we capital allocation

clearly, little given view. the today, uncertainties being have then in sit more cautious bit a And a near and risks term. We point all the as we're here of we

Operator

line question with next Our comes from the Cunningham Patrick of Citi.

Patrick Cunningham

in had guys what quarter now derivatives, strong online. we plant And is and Maybe up but some how the think weakness ramp a the each record You up nameplate? PO/TBA should into of I&D, see from to should gets we the in with margin set about in across of chains? it as oxyfuels, XXXX EBITDA there's plant still sort PO/TBA

Peter Z. Vanacker

Very question. very me, of Patrick. in a new Maybe of North America let course, PO/TBA start-up of with the again you, has, Yes. plant, all, mix capacity that, Thank course, changed. good successful first our highlight, of

side, North in X.X tons. of tons one America. And million million global PE on capacity mean, capacity we I we X.X a of have about hand in have now oxyfuels,

I successful highlight think I changed. with So mix portfolio has, also that's that investment, mean, important our to successfully that

around Kim, you oxyfuel that, I to say outlook, with margins? So your for want mean, something

Kimberly Foley

Absolutely.

Let Markets start Day. by taking to us me back Capital

mid-cycle about I&D of produce I EBITDA for an said would cycle margins think segment X.X. then is we the what

just $XXX you new north we're of billion. $X plant million, think an if incremental So as about the

positive which really current term, capacity in this on challenged segment both the volume our oversupply, demand weak, durable continue are for Short But levels. and Margins see historical margin side, demand strong to above is environment. we by oxyfuels. and impacts

of Markets footprint, with So low-cost through Day, our combined as cycle. provides asset we global the Capital discussed it's diversity segment, that EBITDA this again, positive this in

Peter Z. Vanacker

the in lot management in The on team good and a quite chain as POs. has flexibility of as work well on global chain by supply done supply very management as up well oxyfuels more building global

in help future. the also will that So

Operator

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

David Begleiter

to think, success beyond good very Can in term? What's with Value high having time this longer the frame? you're you potential and run Program. get the rate, $X you program billion 'XX do the Enhancement Peter,

Peter Z. Vanacker

it I I'm Thank at question. David, programs the the how I've value very for other done past very, you, your embraced these pleased companies, enhancement the actually team with took longer. mean and LyondellBasell program. has in

We out in smaller have involved. having huge to with Value now a now sites success. X,XXX amount just about Enhancement rolled that E of Program, people X,XXX We or have the went also Phase

XXX As increased million Today, exceed we going original EBITDA. that I our to said, XXX we're it million. million. mean, we target rate run first actually year, was exit said XXX to We

changed said XXX have this part target. becomes million DNA. as I our We It a mean, in the haven't the of project. not we But is past,

a So beginning it have end. doesn't and an

we million going a not as definitely say So can consequence. XXX stop that it's to at

we more So be will capture value. able to

going we phase, because And I new mean, the that involved have captured. that have were that sessions brainstorming happening already again, in they they sites the first -- initiatives, started see already new through

of building have continue So increase already start new we to a identified, new projects, sites let's that first-level and value creation. group to mean, that up I certain, say, projects already

Operator

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

Steve Byrne

it process? the first your to than MoReTec your of choice quarter put the hydrocrackers Thank the for treaters would lead XXXX keep And would fuels? and you hydro the influence to operate them Texas? it and longer that Yes. of What also to utility And as if longer-term that refinery you hub where functional would renewable that DOE-funded potentially hydrogen is is, selected probability you. for put

Peter Z. Vanacker

that the Thanks, Steve. were very funding, of included Houston pleased Good receive have Velocity has project question. in High amongst seven course, announced that been the I projects we that. mean, been to that

of that velocity. part we HROs, refinery, that high on project our Our have is

So good great. That's support. we get very

a them until we There's the I project. steps, quite be investment it to decisions. are into step. lot course, that gives, develop mean, still of to course, to move we of already a need continue But next at Of taken of lot that support

have the multiple in looking that are we projects at. currently refinery, that, transformation our of we Houston said of Having course,

MoReTec upgrading will here, investment. of plastic looking projects MoReTec would much of be that X And hub. X. X are is those the of our oil out X MoReTec hub. MoReTec than is we at come Houston colon Remember, the the One larger

MoReTec that treaters our upgrade interconnection the in leveraging upon our and investment that Houston oil our X we through view So hydro with in steam channel crackers. equipment having pipelines to have Houston, plastic like then

That's the project. second

Third project that at if them leveraging would we produce treaters, the can hydro steam that hydrocarbons we leverage see is to treaters upon into are cracker. hydro looking renewable again in the feeding those upon

So they have a CapEx having projects, and multitude follow these of projects currently phase, that will we of have teams we but usual the analyzing gate. we in dedicated then, a very are early course, stage very

Operator

Our next Matthew Holt. Tudor, from Blair of question comes Pickering, the with line

Matthew Blair

Lyondell talk about the dynamics and are highest this as on you in seeing kind time trends quite What volumes actually Could think in year supply polypropylene? XXXX? this in the global of demand were some for you both area. I well as into

Peter Z. Vanacker

Matthew. to Ken. immediately that going you, question Thank to give I'm

Kenneth Lane

thanks, Matthew, question. and the very much, you for Thank Yes.

we're even in in has polypropylene in the what balanced we're dynamics seeing China similar XX has become exporting capacity amount seeing to over demand supply The and There's of last around XX still and now has pretty much been China. come online polypropylene. that some new tremendous PE. that is to months, especially a

to polypropylene back have market and challenged, seen but growth the started is So that come some in quarter-over-quarter. have demand see we

packaging. the segment year automotive showing One market across our when signs this I I of for compare when segments like others look to is of the all improvement it frankly, the market division, -- of segments

volumes seen We improvement commercial in some back some by also construction. Catalloy, driven Catalloy, in in bounce have

general, environment. in good assets, -- still a a of portfolio have very -- So challenging but it's market we very

Operator

line question Leithead the of from Barclays. with Our Mike next comes

Michael Leithead

considered EAI been scale ask I shutdowns a or profitability. any challenged for on recovering? it, highlighted or simply maybe about you I But to closure. its, there historic $X Or back X Great. being bigger quite polypropylene picture asset it the billion guess call a pathway you quarters is has to is of O&P to this level? so. larger segment wanted get a I so EBITDA here? restructuring question think past know demand EBITDA And the how potential or do question

Peter Z. Vanacker

good of have you the line Thank that Brindisi. are union southern of shutdown the of negotiating now with well Very in Mike. we you, noted, particular that the the part And as midst question. we representatives in Italy one and on

mean, also in as as usual, assets on the at APS I the but not actions limited as have that mean to joint the other seen mean, we the I to example, continue POSM. we O&P you course, have Of business. Like, I&D business, business we well look our that have the venture we for I that have, just, all [indiscernible] some taken.

We have idled the that of last a this of year. at couple like we end times did already year, just

line to of different be taken, that mean, look So these that we southern part are in we Italy. But one very continues that down, all I for us to planning at that opportunities. shut the important have I mean, decision we that

Operator

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

Frank Mitsch

results. the with a company X proactively to out high, billion I $X.XX months too $X.X third the went was quarter billion guidance ago, Congrats this that, the $X.XX billion. that on probably nice of If for and was consensus back at And X look EBITDA. thought

it in why with reasons could would feels about line results. I fourth Street that color you we no today, came billion $X.X more quarter, third the the for billion. outlined $X.XX that the that be Lyondell question you that would actually right results terms Obviously, great. here question positive EBITDA as in Any that better, is, the stand But in tact having my quarter, taken in the provide the assume at begs guidance of is

Peter Z. Vanacker

fact I capacities. guidance. And with example, of Like, PO for then not right. there in what offline. we Grail, were volumes world's that that mean of in we it, issues had They mean to peers it said Frank, didn't their call on course, I oxyfuels I But in we mean, your QX, online, about I And mean skyrocketing that I thanks had mean, absolutely, during I had a from able, were facilities to QX, take them course, markets. couple of mean, the margins we profit our had but Holy elements of for just is, the that, business. of you're with course, question. of available, the anyhow, I successfully happened the our the fact, call that due to that we also some

of we team -- the team able regions. in our can business we that a the have details a steer also available I it that that with core was upgrading first of lot behind we mean, we have strategy. core, agility maximize in our huge growing our value. there's to capacities -- have those part that that And Remember, different between and shows in that it, the the pillar the how world that So this different parts we in the is

alluded seen also about to fact also, we a margins, seasonality you that I the mean, talk alluded we in have are they historically. if oxyfuel QX. higher, normal said regards we've Kim QX, we've Now have than what with to

have place. capacities, the We I mean, in

said, was mean, on on units. an margins course, issues, in leverage above we've And more, historic to oxyfuels their like of But peak let's not mean, going situation level, a one whereby but cannot be therefore, in competition I QX. has it I or a level always are say, with

the mean, know you and I asset, polypropylene at olefins I is polyethylene mean, what and happening, business. then And

I we prudent continue think are QX. at we when So to be looking

Operator

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

Vincent Andrews

that? opportunity Or ODA collaborate technologies are you does that an in? financial the to companies that investment, And a asked things potential new do you purely the Lombard edge or on any with interact is with and that invested being the companies give have like just I investment?

Peter Z. Vanacker

looking Vincent, Yes. kind are question. for Thank when mean, at funds. I say, these more let's investments strategic you in of that we been, very We've much,

So look at strategy the strategy, Markets Capital Day, our are of low-carbon we is second in at we of building upon solutions based also clearly in that that our when a course, knowledge articulated area, looking the clear what up happening the on our circular it's enhancing at pillar profitable business, and marketplace.

we that more box the So on that ticks fund market. have because visibility

can they were make continue to that, supporting in to to we sure companies want that so that fund these we of addition In that grow. technologies, also course, early-stage that are

a looking conceptual it venture much is of and from a it investments. more just also at So point not pure strategic view. It's financial

Operator

comes question the with next of Alembic Our line Ahmed Hassan from Global.

Hassan Ahmed

the about A water levels in Mississippi. in Recently talk news, been quick a of there's lot lower one. the

guys or whether you any well? the form So way broadly or just as wondering impacting I was industry that's in

Peter Z. Vanacker

you, for No question. Hassan, our your for I mean, impact, Thank business.

Operator

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

Aleksey Yefremov

heels Your adds is a But to not of in very separately other acquisitions many them of made quite it capital. the this area, one large. I up cyclic perhaps comes announcement bit and of mean, on potentially you've

clarity sort any far these capital much would provide this? to of forward on deals you be going how so And the acquisitions? what how into spend the like on went rate Could for run

Peter Z. Vanacker

around these the building circular is focused channel and Europe, around And Cologne, beginning and [indiscernible] our [indiscernible], that one up on in where one mainly is at HRO so It's have renewable assets. and apps, Houston, the we view. other

so upstream go is Markets get important. partners, plastic in that we in do The mean, believe way that together the investing the working to at access, we our I because also getting waste waste plastic how access, strategy mean to we is I to both have articulated Day upstream Capital with

Then catalytic I technology, investments two course, the so-called the recycling, that secondly, upon investing of upon start-up MoReTec with micro have technology, FID, have recycling leveraging, but first and with also advanced companies, before. our also own relationship then recycling in mentioned we that both the advanced

here, brand Maple that to we we And have through demand And also, the acquisition then actually thirdly, the coming actually looking is business. done at the our were OEMs, to that we are owners in where have this marketplace the from. closer we closer access or so APS

value where upstream why value you the positions making we are that's in chain have let's are all say, we and the the downstream -- covering, deals that value smaller because that these company we chain or entire no is covering that see taking is chain. entire the is or So there the one

than We've XXXX, in time investments, that over the said at the investments of XXXX. the XX% bit Capital that XX% I about, talking more our Markets little were mean, maybe we period of Day around a

XX% I very Michael? our not view see more than that So has the have a said in good ballpark, pretty that mean, substantially, traction. maybe I we because much, bit we changed but

Michael McMurray

perspective. breadbox around more specifically then and give people to a bit maybe a Yes, just these investments, put to

to not they're While in important material the they're strategy, amount.

$XXX And far so less what is invested million. thus kind than we've of

Operator

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

Kevin McCarthy

please. Maybe segment, I&D on your two questions

it the as Or for Would seen First, profitability October? question? comments expectation in an that you expect be the I is and butane on maybe like oxyfuels, you understand based on first sounds your just future? to regress already Have other some that factors.

timing those [indiscernible] maybe secondly, down? considerations. up? us they back And come are then Or still can sequential XQ terms versus help you the with XQ of of your outages And have in plants modeling

Peter Z. Vanacker

oxyfuel exceptional, continue Thank we we your you, I mean because were lowest remember, I said Kevin, are questions. producer. in mean, we but the margins cost for what QX

to margins continue comfortable, I be historically. very than seen with mean, higher we We have what

your will two to more lead Kim questions. I to So in answer it detail

Kimberly Foley

Absolutely.

talk about oxyfuels first. the let's profitability of So

profitability be some the So be cracks, the your your the as key the pay of put that crude would into premium butane, of be market to price the as the gasoline ratio gasoline pool. there drivers would would octane for will well to of crude,

what their in pool. that that third people the octane out really gasoline premium quarter saw to get you that into blow wanted So was

we've the So question we than not see to your peaks in quarter. higher the but premium we as historical, why third seen that right? volatility yes, they're that it down some in saying we're to crude, relates that's -- answer saw come But October,

the to the guidance rates, we've quarter. fourth rates XX% given then operating in that on question answer for And presentation your operating earlier POSM the was

up plants meet PO/TBA got operating down, our POSM of and our plants two rate. that have to we we've So XX%

Peter Z. Vanacker

investments on of as the us these a a them of that we first at core also growing see, the mean, to into our And XX% upgrading are continue that have growing. again, in is the huge strategy, our markets are fits opportunity very And investment plant the total are can successful PO/TBA you That as running I we gives capacity. because pillar and grow. to

Operator

the Our RBC of line Arun next question Capital Viswanathan with comes Markets. from

Arun Viswanathan

your guess, here. to, get just wanted how on thoughts I detail Great. markets polyethylene about thinking you're more I some from on

for two September. as So were and the increases August noted, you there

of seeing new we're some then absorption conditions new some capacity. and challenging in But still China,

should look on out we've review against would you you here? as your do markets -- bottomed characterize with as into and you see So operating the well? some that that demand 'XX, we How and backdrop sustainable think increases PE of U.S.

Peter Z. Vanacker

to seen mean, PE the is, thing -- the that continuously of that to Before we I I have mean, exports mean, answer last during up that question, gone I the comfortable have course, positive lead, Ken I quarter.

is, course, that of So positive sign. a

But the difficulties. would the to, that at what technical not markets has of really because need capacity one we're come look has hit of mean, that reading perceived, I some the paper also or additional course, in Ken? market

Kenneth Lane

I'll to a gas we're very especially volatility is seeing the that, high production oil ratio we robust. that continue, being going for exports that to good markets add gas support Arun, oil expect just with those relatively around and to with

So in is but because very what's is of margins the inflation we terms higher naphtha the market. be down, going pricing we are impacts happening that Europe there with to That American North challenged of saw. do feel still good mainly demand. continue the the in also challenged about significantly to

fourth third and signs a seeing really momentum we've quarter, coming of into going very that's the growth market China to out going some got So in good challenging continue in quarter of Europe.

Operator

Josh final the line Spector UBS. Ladies from question and morning comes of gentlemen, this our with

Joshua Spector

that China. you're follow on to at up last want I looking Actually point when the

in of I seeing on your Or -- And impact as we of that? an into curve update year? inventory? you're next what over shape can on the are go the hump that does you the we capacity around the think additions give view terms us What's there?

Peter Z. Vanacker

mean, related, that's to PE. to take going and Josh, you, Thank then to Ken I because

question. Your

Kenneth Lane

Yes.

coming we that's bottom. going to more I then the an and still why year, comes us. out of and and half to but kind to back to industry, around some that's new end hope for next biggest the Josh, year, next we're the see Overall, bouncing back going along coming the -- absorb as start the in we're additional pressure there's watch going in capacity next be of going capacity capacity, So be first to be recovery continue think, of be year online the to see to is in, growth market

Peter Z. Vanacker

Yes.

You XX% to and there you in China, from now that look, that are been closer see, place. increase construction up incentives evaluations yet. and then motive actually being if year-on-year I don't the for example, Beijing, has is picking continuously EV market in been mean, see put the We in has has XX%. -- But

money. continue But I we a hand of consumers the to on side, I see other mean, the lot save, mean,

its continue expect course, confidence And savings these that also would would incentives, level. well. of But the at on the and, will on more So a spending one middle to durable of in course, high as have be class. of that, in population more their grow then the influence and goods

Operator

back turn time. Mr. Vanacker final and showing any other for to this Ladies gentlemen, comments. questions at I'm the I'll no floor

Peter Z. Vanacker

pleased, has done teams. QX. I again. are we are Great that mean, that been good again you, Thank very environment And let job that by considering we Very all in highlight with me the market questions. the the results,

implementation strategy. sharing to the course, We, long-term make we progress forward over on as continue months continue to updates of to of also our coming look the

great I a have weekend a a weekend. you all well stay Therefore, wish safe Stay you you. safe. and hope We one. great and Thank

Operator

concludes This conference you. call. today's Thank

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

We use cookies on this site to provide a more responsive and personalized service. Continuing to browse, clicking I Agree, or closing this banner indicates agreement. See our Cookie Policy for more information.