01—Abstract
Summary
Summary of the 10-Q filed April 26, 2024. Cited figures are marked; the original filing is the authoritative source.
LyondellBasell Industries N.V. reported first-quarter 2024 net income of $473 milliona, down slightly from $474 million in the first quarter of 2023, on revenues of $9.93 billion versus $10.25 billion a year earlier.
Operating income was $704 millionb, essentially flat with $713 million in the prior-year quarter. Diluted earnings per share were $1.44, unchanged year over year. Weaker results in the Refining, Intermediates & Derivatives, and Olefins & Polyolefins-EAI segments were offset by higher Advanced Polymer Solutions results, which benefited from the absence of the prior-year $252 million goodwill impairment.
Segment EBITDA totaled $1.05 billionc, compared with $1.13 billion in the first quarter of 2023. Cash flow was weaker. Operating activities used $114 million, compared with $482 million provided in the prior-year quarter, as working capital absorbed $629 million, mainly higher receivables from increased volumes and prices.
The company spent $483 milliond on capital expenditures and paid $408 million in dividends. Cash and cash equivalents fell to $2.31 billion from $3.39 billion at year-end 2023. In February 2024 the company issued $750 million of 5.5% guaranteed notes due 2034 and used the proceeds to repay the $775 million 5.75% senior notes due 2024 in March.
The company stated that it expects seasonal demand improvements in the second quarter of 2024, with planned average operating rates of 85% for O&P-Americas and O&P-EAI and 80% for Intermediates & Derivatives. The filing also notes the planned sale of the Bayport, TX ethylene oxide and derivatives business for $700 million, expected to close in the second quarter of 2024, and a pending acquisition of a 35% interest in NATPET for approximately $500 million. Total debt including current maturities was $11.19 billion at March 31, 2024, and the company stated it was in compliance with its debt covenants.
02—Key points
Key Highlights
- Net income of $473 million and diluted EPS of $1.44 were nearly flat versus the first quarter of 2023 ($474 million and $1.44).
- Revenues fell to $9.93 billion from $10.25 billion, while operating income held at $704 million versus $713 million.
- Operating cash flow was negative $114 million, down from $482 million, due to a $629 million working capital build.
- Capital expenditures were $483 million, up from $352 million, with about 80% supporting sustaining maintenance.
- Dividends of $408 million were paid, and no share repurchases were made in the quarter; about 33.1 million shares remained under the authorization as of April 24, 2024.
- Refinanced the 2024 maturity by issuing $750 million of 5.5% notes due 2034 and repaying $775 million of 5.75% notes.
- Pending sale of the Bayport EO&D business for $700 million and planned acquisition of a 35% NATPET stake for about $500 million.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2024, LyondellBasell Industries kept $0.06.
- Revenue$8.30B100.0%
- Cost of revenue−$7.20B86.7%
- Gross profit$1.10B13.3%
- Operating costs−$453.0M5.5%
- Operating income$651.0M7.8%
- Interest, other & tax−$178.0M2.1%
- Net income$473.0M5.7%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2024filed April 26, 2024Financial Statements
Q1 FY2024 against Q1 FY2023
| Line item | Q1 FY2024Q1 FY2023 | Change |
|---|---|---|
| Revenue | $8.30B$10.25B | −19.0% |
| Cost of Revenue | $7.20B$8.86B | −18.8% |
| Gross Profit | $1.10B$1.38B | −20.2% |
| R&D Expenses | $32.00M$33.00M | −3.0% |
| SG&A Expenses | $421.00M$385.00M | +9.4% |
| Operating Expenses | $7.65B$9.53B | −19.7% |
| Operating Income | $651.00M$713.00M | −8.7% |
| Interest Expense | $127.00M$116.00M | +9.5% |
| Net Income | $473.00M$474.00M | −0.2% |
| EPS (Basic) | $1.45$1.45 | 0.0% |
| EPS (Diluted) | $1.44$1.44 | 0.0% |
05—Questions
Frequently Asked Questions
Why did operating cash flow turn negative in the first quarter of 2024?
The filing attributes the $114 million cash use in operating activities mainly to a $629 million build in working capital, driven primarily by higher accounts receivable from increased volumes and prices across most segments.
How did segment performance differ in the quarter?
Total segment EBITDA was $1.05 billion versus $1.13 billion a year earlier. Advanced Polymer Solutions improved to $35 million from a $226 million loss, which included a $252 million goodwill impairment in the prior-year period. Refining EBITDA fell to $55 million from $246 million on lower margins, and Intermediates & Derivatives EBITDA fell to $312 million from $426 million.
What is the company's debt position after the first-quarter activity?
Total debt including current maturities was $11.19 billion at March 31, 2024. The company issued $750 million of 5.5% guaranteed notes due 2034, repaid $775 million of 5.75% senior notes due 2024, and had $3.25 billion of unused availability under its senior revolving credit facility and $900 million under its U.S. Receivables Facility.
What does the company expect for the second quarter of 2024?
The company expects seasonal demand improvements across most segments, with oxyfuels and refining margins expected to rise as the summer driving season starts. It plans average operating rates of 85% for O&P-Americas and O&P-EAI and 80% for Intermediates & Derivatives.
How much did the company return to shareholders this quarter?
The company paid $408 million in common stock dividends ($1.25 per share) and made no share repurchases in the first quarter of 2024, compared with $70 million of repurchases in the first quarter of 2023.
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