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LyondellBasell Industries 8-K Report, Financial Results (Apr 26, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed April 26, 2024
Period End
April 26, 2024
Security
LYB
In the record · 2016–202610-K1110-Q338-K127

LYB filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 127 current reports (8-K) between 2016 and 2026.

  1. Deal closed8-K · Aug ’18Aug ’18
  2. Leadership change8-K · Jun ’20Jun ’20
  3. Leadership change8-K · May ’22May ’22
  4. Material agreement8-K · May ’26May ’26

01—Abstract

Summary

Summary of the 8-K filed April 26, 2024. Cited figures are marked; the original filing is the authoritative source.

LyondellBasell Industries N.V.

(NYSE: LYB) reported first quarter 2024 net income of $473 milliona, or $1.44 per diluted share, and $501 million, or $1.53 per diluted share, excluding identified items. First quarter EBITDA was $1.0 billion, or $1.1 billion excluding identified items ($1,047 million and $1,063 million, respectively). Identified items totaled $28 million net of tax, or $0.09 per share, related to costs of plans to exit the refining business.

Cash used by operating activities was $114 millionb, driven by a working capital build tied to expected seasonality and higher volumes and prices, while the company invested $483 million in capital expenditures and returned $408 million to shareholders through dividends. Cash and liquid investments were $2.3 billion and total liquidity was $6.5 billion at quarter end. Trailing twelve-month cash conversion was 93%, with cash provided by operating activities of $4.3 billion over that period.

By segment, Olefins & Polyolefins-Americas EBITDA was $521 millionc versus $604 million in the fourth quarter of 2023, and Intermediates & Derivatives EBITDA rose to $312 million from $73 million. Advanced Polymer Solutions and Technology both improved sequentially. Refining EBITDA was $55 million, and the Houston Refinery ran at a 79% utilization rate.

The company repaid no debt in the filing but issued $750 milliond of bonds to refinance its 2024 maturity at a lower interest rate. For the second quarter of 2024, management expects seasonal demand improvements across most businesses, with average operating rates of 85% for global olefins and polyolefins assets and 80% for Intermediates & Derivatives assets. Management also noted that low natural gas and NGL costs should support North American and Middle East margins, and that oxyfuels and refining margins are expected to rise with the start of the driving season.

02—Key points

Key Highlights

  1. Net income of $473 million ($1.44 per diluted share) versus $185 million in Q4 2023 and $474 million in Q1 2023; excluding identified items, $501 million ($1.53 per share).
  2. EBITDA of $1,047 million, or $1,063 million excluding identified items, compared with $639 million and $910 million, respectively, in Q4 2023.
  3. Cash used by operating activities of $114 million in the quarter, due to a working capital build; trailing twelve-month cash provided by operating activities was $4.3 billion, a 93% cash conversion rate.
  4. Returned $408 million to shareholders via dividends and invested $483 million in capital expenditures during the quarter.
  5. Year-end liquidity: $2,331 million in cash and liquid investments and $6,481 million in total liquidity, including $3,250 million of availability under the Senior Revolving Credit Facility and $900 million under the U.S. Receivables Facility.
  6. Issued $750 million of bonds to refinance the 2024 maturity at a lower interest rate.
  7. Q2 2024 outlook calls for seasonal demand improvement, operating rates of 85% for global olefins and polyolefins and 80% for Intermediates & Derivatives, and higher oxyfuels and refining margins.

03—Questions

Frequently Asked Questions

  1. What drove the decline in operating cash flow this quarter?

    Cash used by operating activities was $114 million, driven by a build in working capital tied to expected seasonality and higher volumes and prices in several businesses, according to the release.

  2. What were the identified items affecting first quarter earnings?

    Identified items totaled $28 million net of tax, or $0.09 per diluted share, related to costs incurred from plans to exit the refining business. Refinery exit costs were $36 million pre-tax in the quarter.

  3. How did the segments perform compared with the prior quarter?

    Intermediates & Derivatives EBITDA increased to $312 million from $73 million, and Olefins & Polyolefins-EAI EBITDA rose to $14 million from negative $125 million, helped by logistics disruptions in the Red Sea. Olefins & Polyolefins-Americas EBITDA declined to $521 million from $604 million, largely due to asset downtime.

  4. What is the company's outlook for the second quarter of 2024?

    Management expects seasonal demand improvements across most businesses, with average operating rates of 85% for global olefins and polyolefins assets and 80% for Intermediates & Derivatives assets. It also expects oxyfuels and refining margins to increase with the summer driving season and remains watchful for demand improvements in China.

  5. How strong is the company's liquidity position?

    At March 31, 2024, the company held $2,331 million in cash and liquid investments and $6,481 million in total liquidity, including $3,250 million available under its Senior Revolving Credit Facility and $900 million under its U.S. Receivables Facility.

04—Continue

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