01—Abstract
Summary
Summary of the 10-Q filed November 1, 2024. Cited figures are marked; the original filing is the authoritative source.
LyondellBasell Industries N.V. reported third-quarter 2024 net income of $573 milliona, down from $747 million in the third quarter of 2023, on sales and other operating revenues of $10.32 billion versus $10.63 billion a year earlier.
Operating income was $802 millionb compared with $1,014 million, and EBITDA was $1,174 million compared with $1,356 million. The filing states that results for the third quarter declined compared to the second quarter of 2024, with integrated polyethylene margins in O&P-Americas increasing while I&D and Refining margins fell on lower crude prices and gasoline crack spreads. Diluted EPS was $1.75 for the quarter versus $2.29 a year earlier.
For the first nine months of 2024, net income was $1.97 billionc versus $1.94 billion in the prior-year period, and operating income was $2.48 billion versus $2.74 billion. The nine-month results include a $293 million pre-tax gain on the sale of the Ethylene Oxide & Derivatives business, which the company received $700 million in cash for. Refining segment EBITDA fell to a loss of $12 million for the nine months from $369 million a year earlier.
Operating cash flow was $1.90 billiond versus $3.44 billion, and the company returned $1.40 billion to shareholders through dividends and buybacks. The company also acquired a 35% stake in NATPET for about $500 million and is pursuing a strategic review of some European assets and a planned exit from its Houston refinery business, with exit costs estimated at $610 million to $980 million. At September 30, 2024, cash and cash equivalents were $2.62 billion, total debt including current maturities was $11.26 billion, and the company had $4.65 billion of unused credit facility availability.
The company stated it was in compliance with its debt covenants. For the fourth quarter, management expects year-end seasonality to soften demand and expects operating rates of 85% for O&P-Americas, 60% for O&P-EAI and 75% for I&D.
02—Key points
Key Highlights
- Third-quarter 2024 net income of $573 million, down from $747 million in the third quarter of 2023; diluted EPS of $1.75 versus $2.29
- Third-quarter operating income of $802 million versus $1,014 million a year earlier; EBITDA of $1,174 million versus $1,356 million
- Nine-month results include a $293 million pre-tax gain on the May 2024 sale of the EO&D business for $700 million in cash
- Refining segment EBITDA was a loss of $12 million for the first nine months of 2024, compared with $369 million in the first nine months of 2023
- Nine-month operating cash flow of $1.90 billion versus $3.44 billion, with capital expenditures of $1.34 billion
- Returned $1.40 billion to shareholders in the first nine months through $1.28 billion of dividends and $117 million of share repurchases
- Cash and cash equivalents of $2.62 billion, total debt of $11.26 billion, and $4.65 billion of unused credit facility availability at September 30, 2024
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2024, LyondellBasell Industries kept $0.07.
- Revenue$8.60B100.0%
- Cost of revenue−$7.30B84.9%
- Gross profit$1.30B15.1%
- Operating costs−$436.0M5.1%
- Operating income$865.0M10.1%
- Interest, other & tax−$292.0M3.4%
- Net income$573.0M6.7%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed November 1, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Revenue | $8.60B$10.63B | −19.0% |
| Cost of Revenue | $7.30B$9.18B | −20.4% |
| Gross Profit | $1.30B$1.45B | −10.2% |
| R&D Expenses | $31.00M$31.00M | 0.0% |
| SG&A Expenses | $400.00M$378.00M | +5.8% |
| Operating Expenses | $7.74B$9.61B | −19.5% |
| Operating Income | $865.00M$1.01B | −14.7% |
| Net Income | $573.00M$747.00M | −23.3% |
| EPS (Basic) | $1.76$2.29 | −23.1% |
| EPS (Diluted) | $1.75$2.29 | −23.6% |
05—Questions
Frequently Asked Questions
Why did third-quarter 2024 earnings decline compared with the prior year?
Net income fell to $573 million from $747 million, and operating income fell to $802 million from $1,014 million. The filing attributes the sequential decline versus the second quarter to lower margins in the Intermediates and Derivatives and Refining segments, driven by lower crude oil prices and gasoline crack spreads. Refining EBITDA was a loss of $60 million in the quarter, and I&D EBITDA was $317 million, while O&P-Americas EBITDA rose to $758 million.
How did the sale of the Ethylene Oxide & Derivatives business affect results?
In May 2024 the company sold its U.S. Gulf Coast EO&D business and the Bayport, Texas production facilities for $700 million in cash and recognized a pre-tax gain of $293 million, subject to customary post-closing adjustments. The gain was recorded in the second quarter and is the main reason nine-month operating income in the I&D segment declined less than it otherwise would have.
What is the status of the Houston refinery exit and related costs?
The company estimates total costs for its planned exit from the refinery business will range from $610 million to $980 million, largely due to asset retirement obligation estimates. Refinery exit costs were $57 million in the third quarter and $135 million for the first nine months of 2024, and the company had recorded $264 million of asset retirement obligations as of September 30, 2024.
How is the company's liquidity and debt position?
At September 30, 2024, the company had $2.62 billion of cash and cash equivalents and $11.26 billion of total debt including current maturities. Unused availability was $4.65 billion, comprising $3.75 billion under the Senior Revolving Credit Facility, which was amended in July 2024 to increase to $3.75 billion and extend to July 2029, and $900 million under the U.S. Receivables Facility. The company stated it was in compliance with its debt covenants.
What outlook did management give for the fourth quarter of 2024?
Management expects year-end seasonality to soften demand across most businesses, with higher natural gas and ethane feedstock costs expected to moderate North American integrated polyolefins margins. Oxyfuels and refining margins are expected to continue to decline. Planned fourth-quarter operating rates are 85% for O&P-Americas assets, 60% for European O&P-EAI assets and 75% for I&D assets.
06—Continue