01—Abstract
Summary
Summary of the 8-K filed July 31, 2026. Cited figures are marked; the original filing is the authoritative source.
LyondellBasell Industries N.V.
(LYB) reported second quarter 2026 results on July 31, 2026, with net income of $559 milliona, or $1.71 per diluted share, compared with $125 million ($0.38 per diluted share) in the first quarter of 2026 and $115 million ($0.34 per diluted share) in the second quarter of 2025. Excluding identified items, net income was $1.40 billion, or $4.30 per diluted share. EBITDA was $1.25 billion, or $2.13 billion excluding identified items.
The largest identified item was a $734 millionb pre-tax loss on the sale of business, tied to the May 2026 divestiture of select European olefins and polyolefins assets. Management attributed the improvement to supply-constrained market conditions following geopolitical instability, particularly in the Middle East, which lifted polymer margins and co-product pricing, especially in O&P-Americas, where EBITDA was $1.18 billion. Cash generation and liquidity were also in focus.
The company generated $752 millionc in cash from operating activities, though working capital was a use of cash. It included a $310 million cash contribution tied to completing the European divestiture. Capital expenditures were $270 million, and dividends totaled $224 million, with no share repurchases in the quarter.
Cash and cash equivalents were $2.63 billiond, and total liquidity was $7.09 billion at June 30, 2026. The company said it remains on target to deliver $500 million of incremental cash through its Cash Improvement Plan by the end of 2026.
For the third quarter, LYB expects operating rates of 85% for North American O&P assets, 70% for European O&P assets, and 85% for Intermediates & Derivatives assets. Management noted that the recovery in conflict-impacted supply could extend into 2027, and that a scheduled note maturity will be repaid in September.
02—Key points
Key Highlights
- Net income of $559 million, or $1.71 per diluted share, in Q2 2026, versus $125 million ($0.38) in Q1 2026; excluding identified items, net income was $1.40 billion, or $4.30 per diluted share.
- EBITDA of $1.25 billion for Q2 2026 and $2.13 billion excluding identified items, compared with $568 million and $615 million, respectively, in Q1 2026.
- Identified items included a $734 million pre-tax loss on sale of business from the divestiture of select European O&P assets, completed in May 2026, and a $74 million asset write-down tied to a Houston plastic waste sorting facility.
- O&P-Americas EBITDA reached $1.18 billion in Q2 2026 ($1.27 billion excluding identified items), with ethylene crackers operating at approximately 95% of capacity and North American assets at approximately 90% utilization.
- Operating cash flow was $752 million in Q2 2026, with working capital a use of cash and a $310 million cash contribution related to the European divestiture.
- Liquidity stood at $7.09 billion at June 30, 2026, including $2.63 billion of cash and cash equivalents and $3.75 billion of availability under the Senior Revolving Credit Facility.
- Third-quarter operating rate guidance: 85% for North American O&P, 70% for European O&P, and 85% for Intermediates & Derivatives, with the Bayport PO/TBA restart expected to add volume and planned Clinton downtime expected to weigh on polyolefins volumes.
03—Questions
Frequently Asked Questions
Why did reported net income rise so sharply from the first quarter?
Margins improved across the business as global supply constraints, tied to the conflict in the Middle East, lifted prices. O&P-Americas EBITDA rose from $327 million in Q1 2026 to $1.18 billion in Q2 2026, including a $74 million asset write-down. Reported results were also affected by a $734 million loss on the European divestiture, which offset part of the gain.
What were the main identified items that affected Q2 2026 earnings?
Identified items reduced Q2 2026 earnings by $2.59 per diluted share. The largest was the $734 million pre-tax loss on sale of business from the European O&P divestiture. Other items included a $74 million asset write-down, $31 million of Cash Improvement Plan costs, $30 million of site closure costs, and an $11 million benefit from European transaction costs net of transition service agreement income.
How is LYB positioning its cash flow and balance sheet?
The company reported $752 million of operating cash flow and $270 million of capital expenditures in Q2 2026, and paid $224 million in dividends without share repurchases. It ended the quarter with $2.63 billion of cash and cash equivalents and $7.09 billion of total liquidity. Management reiterated that it is on target to deliver $500 million of incremental cash through its Cash Improvement Plan by the end of 2026 and will repay a scheduled note maturity in September.
What does management expect for the near-term outlook?
Management said Middle East conditions remain fluid and expect continued volatility in energy and petrochemical markets. The recovery in conflict-impacted supply may extend into 2027, and uncertainty in near-term pricing could temporarily affect normal buying patterns. For Q3 2026, operating rate expectations are 85% for North American O&P assets, 70% for European O&P assets, and 85% for Intermediates & Derivatives assets.
What did the European divestiture involve, and what is its impact?
The company completed the divestiture of four European assets in May 2026, which the filing describes as a step in its Grow and Upgrade the Core strategy. Management said the transaction improves the cost position, aligns the European footprint with strategy, and increases the proportion of assets connected to advantaged feedstocks. The transaction produced a $734 million pre-tax loss on sale and a $310 million cash contribution in the quarter.
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