WLKP - Earnings call transcript Q2 2024 | Westlake Chemical Partners LP

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Operator

Good afternoon. Thank you for standing by. Welcome to the Westlake Chemical Partners Second Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded today, August 6, 2024. I would now like to turn the call over to today's host, John Zoeller, Westlake Chemical Partners Vice President and Treasurer. begin. may you Sir,

Johnathan S. Zoeller

Gilson, afternoon, Officer; Quarter welcome am XXXX Chao, management President Sean by Good Bender, CEO; Chemical Executive team. other our joined the members Partners Albert Vice Mark Chairman; Executive Second Conference Chief our President everyone, you. and to Steve Financial and and Westlake today our and Thank Call. our I of

company, or Westlake call, subsidiary refer Partnership, and OpCo to to the Partners partnership. assets. olefins we Westlake refer Chemical References owns this which OpCo During our of to as parent Corporation, references Westlake the refer Westlake to ourselves certain Westlake to and a LP,

These Additionally, wlkpartners.com. by in management. website. after which call. our lead topics subject accurate or the that you also as to conclusion expectations terms being call assumptions in as reported would going webcast you of is when encourage time-sensitive quarter made uncertainties. We of about partnership X by any of we via certain these a flow, may our suggest Partners' Today, forward-looking of X, cautionary through to the Relations be to note learn Investor predictions filings, section information management's This replay. I are more press to or the information risks speaks wlkpartners.com. be today's today, results this differ available discuss available forward-looking This actual be contain factors live advised of as flow. an operating is can are based that Partners to the accessed XXXX, at cash as release on finally web the website. Definitions can A available that on management Westlake beliefs are The issued to our the the results. currently our call we is web hours call of on and could of page information on is second be regulatory Partnership's conference referring beginning Westlake you no our will and MLP Release that Please broadcast information reviewing therefore, refer this statements distributable financial on replay thus will accessed statements Internet are to available morning, website. available details are that Chemical distributable and cash time of replay with page at XXXX our longer Press August that this advise only and system document that well

Now I'd like to call over Albert? to turn Chao. the Albert

Albert Chao

us of margin coverage. of our Westlake volatility agreement with and City ethylene business is Calvert market Thank discuss you, of our thank unit. and and our per distributions press cash second income the higher and XXXX, $X.XX production paired the in XXXX reliable or high to release, and second Joe. of predictability as results. quarter has when we stability history risks. The flow quarter the second Good business, other Partners' this million of long sales XXXX to enabled degree through deliver Partners $XX third-party quarter us from net demonstrated for a and of year's and sales The of you In stability last joining prices XXXX, a ethylene morning's quarter Westlake second production everyone, turnaround to minimizes of Compared model result reported earnings sales fixed higher volume consistently afternoon, benefited margins. which sales

his of to new Mitsubishi ensures Jean-Marc's seasoned XXth IPO predictable happy a the the strategy CEO financial the proven sustained provide flows, delivering of leader appointment thoughtful President distribution plan since a as cash combination industry is a performance, quarterly of our recently July quarter's Chemical our distribution track to of partnership a our supporting that He and unitholders. of with Group. record Jean-Marc continuation This is in is to most stable, appointment and succession as with distributions CEO. welcome to XXXX, reductions. We're without President consecutive Gilson the any

I would over initial to to Now call like to turn Jean-Marc Jean-Marc? thoughts. the some provide

Jean Marc Gilson

predictable to its the you, by Thank everyone. and Westlake has flow it XX It's cash earnings a from afternoon, ago, flows. good and Albert, and the supported Westlake formation agreement years sales with ethylene CEO. Since peers consistency OpCo's with pleasure of Partners President join its cash differentiated Partnership's fee-based

Looking a opportunities stability has detail income we to attractive approximately partnership of look forward X.Xx. in Steve? opportunities, and back, interest via cash distribution evaluating current maintained grow agreement higher ethylene sales in growth our operating ownership X distribution including margin of acquisitions expansions in to distribution to since to ratio our the would more like future, of our to on an July such our growth XXXX, now organic IPO flows for streams, of to to with OpCo, the investors. the the call of financial of and levers coverage Steve provide to in ethylene our facilities other of fixed Westlake. I continued qualified of provide our turn quarter. the And our have negotiation a deliver as cumulative over increases I results

Steven Bender

OpCo's had sales earnings partnership income, of or on quarter per million million. partnership, release, and Partners for reported Jean-Marc, In million of morning's this $XXX good $XX including unit. the consolidated The income was million we $X.XX net afternoon, or cash press net flows and quarter $XX welcome the you, per of Thank XXXX distributable second unit. net Consolidated $X.XX Westlake to everyone. $XX

to second partnership million sales net second last Westlake Second increased million City's second the ethylene of quarter for turnaround to $XX XXXX partnership volumes income. Compared the primarily $X third-party Distributable net $XX the and volumes. for year partially higher to to from second and million the was quarter Partners Calvert offset of of higher due production margins, income of higher quarter expense. compared by interest flow XXXX, XXXX prices XXXX sales OpCo's than higher production quarter benefited due quarter XXXX and were and sales million $X of the which higher cash by

leverage distribution the XXXX, the announced with distributions we distribution second our quarterly balance the spent flows. cash quarter quarterly of In of which unitholders, the strong and quarterly The Xx. On quarter management and Westlake grown has of XXXX, XX distributions consecutive XX, consolidated of since million on and million $XXX Partnership was sheet quarter of per XXXX, remaining partnership's and investment XX, of be totaling our approximately we XXXX. had million, have the record with XXXX. the our $X.XXXX capital at million. second was August leverage per a $XXX our second Long-term July investments distribution of August the a through Turning balances was we IPO $X.XXX our original ratio $XXX of to quarter, expenditures. $XX at the to XX, We OpCo unit Partnership's made cash at end agreement million XXXX, maintained unit. with on OpCo. Partnership the paid $XX second of to quarter XX% of cash Since in At consolidated minimum end will respect the the debt attention metrics unitholders to

month XX cost to this result. turnaround, we distribution planned The in we begin has approximately commence for expect and charge been turnaround And turnaround, This coverage and ratio years, For is in is have this is Louisiana. as period and for we next a projected Westlake our X the at the the modeling Charles, has ethylene prior X turnaround scheduled such fully Petro had to we've impacted days. of XXXX amount unit to for a Wake last as similar funded been where turnaround planned purposes, reserved included before recovering. In in one, this we turnaround. the

comments. to like the I'd back Albert? over call make turn to Now Albert closing to some

Albert Chao

Thank you, Steve.

of ethylene and are a in third-party polyethylene the in with performance We of period a the low particular, margin industry-wide ethylene result is new the encouraging online on financial In primarily sales in parties third second quarter. following as sales capacity recent partnership's improvement to margins U.S. pleased XXXX. coming operational

predictable for OpCo's contract While turnarounds. our predictable and the planned unpredictable, environment through and global provides ups sales of our to flows from macroeconomic production base will unplanned stable continue Westlake structure take-or-pay cash agreement, and downs well a fee which economic deliver overall as with XX% remains ethylene cashflow as

very As will where with environment focus operations, we call. along we work listening safe quarter you part earnings our for of always, to to as much of continue stewards sustainability on Thank being efforts. the live our broader second and good

back John. to I'll over the Now turn call

Johnathan S. Zoeller

Thank you, Albert.

the replay begin call that Before of questions, we ended. you remind would has hours available this like to X I after a teleconference will be taking

call. Lauren, the instructions provide the replay take access we now the of to questions. will will end at We

Operator

TPH. comes Instructions] Matthew the [Operator line of question with Our from first Blair

Matthew Blair

turnaround well. XX days at assume fourth your you the this X, depress and will approximately should that temporarily in XX a Petro impact, of coverage quarter days temporary Is also is in mentioned the we impact financial quarter terms the and this your to ratio, the but Regarding third in correct? earnings as

Steven Bender

Yes.

falls Matthew. you're quarter. impact is From probably how assumptions appropriate. earnings think I so in production And are half-half a plan planning it right, Since the your XX-day a And perspective, turnaround. of terms of in it and it's

Matthew Blair

the year, kind you inference? like cracker margins And first in exposure right the sounds rising X% forward, the of And on going ethane guess, below that at the It the sounds be maximum in X% were I expect you to that level. actually spot good. half then the quarter? it to -- of Is third would

Steven Bender

should normal because year. margins actually been actually margin or we've earlier this selling, were advanced say, been I the advance over elevated -- We've ethylene buying in $X.XX ethylene

target we selling normal of actually good progress course through that had the in major X% 'XX. have So

So we shape. we're as in good year. -- half elevated rest we've I that the ethylene we And especially wanted back pretty for try have of of hope margins. of about outage, the the this able advance we to actually get seen participate that to since that, knowing the year, to that participate we're But in think that margins

Matthew Blair

I of Or interest still you? there stalling off fairly last area markets? Sounds good. been And are for the equity seeing you increase that's guess, any closed MLP there? question, in an sort then Or that has of any is

Steven Bender

we're area that say. I an exploring, would still It's

continue interest to MLP while remains price. have There the we As I'd investors shrink. right still number look at values active the opportunities in of looking in the at for say, names marketplace, the

make maintain dialogue arbitrage the for moment levers so valuations that looking heard mention of to and the the X you opportunities pull us we And where to ago. continue those good sense X for us a just a on

Operator

will Zoeller. now John over Thank time, now At to turn the the session this you. has ended. Q&A call back I

Johnathan S. Zoeller

XXXX quarter in participating call. third for our next We results. call you for hope again us discuss you to join Thank today's will conference our

Operator

Chemical Thank Westlake for XXXX Earnings participating you Conference in today's Call. Second Partners Quarter

XX, this Eastern partnership until reminder, will on be ended has call be and the XX:XX The via can call for beginning available Time a accessed Tuesday, p.m. August As XXXX. after replay the X accessed hours replay be Goodbye. website. may

Westlake Chemical Partners (WLKP) 6 Aug 242024 Q2 Earnings call transcript