LyondellBasell Reports Third Quarter 2021 Earnings

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HOUSTON and LONDON, Oct. 29, 2021 /PRNewswire/ —

Third Quarter 2021 Highlights

  • Robust demand and tight market conditions supported strong margins
  • Accelerated our climate goals: 30% CO2 reduction by 2030 and net zero by 2050 (scope 1 and 2)
  • Net Income: $1.8 billion
  • Diluted earnings per share: $5.25 per share
  • EBITDA: $2.7 billion
  • Record cash from operating activities: $2.1 billion
  • Strong cash flow supported debt reduction of $0.7 billion with $2.4 billion year-to-date
  • Paid dividends and repurchased approximately 1 million shares totaling $0.5 billion in returns for shareholders

Comparisons with the prior quarter and third quarter 2020 are available in the following table:

Table 1 – Earnings Summary 

Millions of U.S. dollars (except share data)

Three Months Ended

Nine Months Ended

September 30,
2021

June 30,
2021

September 30,
2020

September 30,
2021

September 30,
2020

Sales and other operating revenues

$12,700

$11,561

$6,776

$33,343

$19,816

Net income

1,762

2,059

114

4,891

572

Diluted earnings per share

5.25

6.13

0.33

14.57

1.69

Weighted average diluted share count

334

335

334

334

334

EBITDA (a)

2,691

3,018

466

7,294

1,872


Excluding LCM and Impairment (a)

Net income

$1,762

$2,059

$427

$4,891

$1,148

Diluted earnings per share

5.25

6.13

1.27

14.57

3.42

LCM (benefits) charges, pre-tax

(160)

163

Impairment, pre-tax

582

582

EBITDA

2,691

3,018

888

7,294

2,617


(a) See “Information Related to Financial Measures” for a discussion of the Company’s use of EBITDA and EBITDA excluding LCM and Impairment and Table 2 for reconciliations of net income to those measures. LCM stands for “lower of cost or market.” Impairment is related to charges incurred in the Refining segment.    

LyondellBasell Industries (NYSE: LYB) today announced net income for the third quarter 2021 of $1.8 billion, or $5.25 per share.  Third quarter 2021 EBITDA was $2.7 billion.   

“Our third quarter results reflect robust demand for LyondellBasell products and tight market conditions, which supported strong margins across most of our businesses,” said Bob Patel, LyondellBasell CEO.

“In North America, solid demand supported continued strength in benchmark integrated polyethylene margins and drove polypropylene spreads to historic highs.  In contrast, higher naphtha and natural gas liquids feedstock prices in Europe led to margin compression for both olefins and polyolefins in our Olefins and Polyolefins EAI segment.  Our Intermediates and Derivatives segment was impacted by rising costs that reduced margins across most of its businesses.  We also lost volume and incurred higher costs in connection with downtime in our acetyls business.  Increasing mobility has improved demand and margins for transportation fuels produced by our Refining segment.”

“Strong market conditions and cash generation from our growth investments resulted in record cash from operating activities during the third quarter.  We redeemed $500 million in bonds to bring our year-to-date debt reduction to $2.4 billion and repurchased 1 million shares during the quarter.”

“In September, we reaffirmed our commitment to address the global challenge of climate change by increasing our goals for reducing scope 1 and scope 2 CO2 emissions at least 30 percent by 2030 relative to a 2020 baseline and achieving net zero from our global operations by 2050,” said Patel.

OUTLOOK
“We expect strong demand for LyondellBasell’s products to continue as the roll out of vaccines drives further improvement in economic activity around the world.  Over the next several quarters, we expect unmet consumer demand will extend strength in automotive, construction and other durable goods markets.  While margins are likely to moderate due to increasing feedstock prices, energy costs and winter seasonality, we anticipate ongoing benefits from strong markets and tight industry supply.” 

“At LyondellBasell, our goal is to deliver results that meet both our financial and sustainability objectives.  We have emerged stronger from last year’s downturn by investing in growth and leveraging our culture of operational excellence and financial discipline over a larger asset base.  LyondellBasell’s step change in earnings power and cash generation is increasingly visible.  With an additional $650 million of bonds redeemed during October, we continued to strengthen our investment grade balance sheet and remain on track to reduce debt by up to $4 billion in 2021.  We expect cash generation will continue to provide flexibility for opportunistic share repurchases.  At the same time, we are helping to address the global challenges of climate change by setting ambitious goals to reduce our CO2 emissions and achieve carbon neutrality for our company by the middle of the century.  Altogether, LyondellBasell’s growth strategy is creating momentum to deliver sustainable value over the coming years,” Patel said.

CONFERENCE CALL
LyondellBasell will host a conference call October 29 at 11 a.m. EDT.  Participants on the call will include Chief Executive Officer Bob Patel, Executive Vice President and Chief Financial Officer Michael McMurray and Head of Investor Relations David Kinney.  For event access, the toll-free dial-in number is 1-877-407-8029, international dial-in number is 201-689-8029 or click the CallMe link.  The slides and webcast that accompany the call will be available at www.LyondellBasell.com/earnings.  A replay of the call will be available from 1:00 p.m. EDT October 29 until November 30.  The replay toll-free dial-in numbers are 1-877-660-6853 and 201-612-7415. The access ID for each is 13723396.

ABOUT LYONDELLBASELL
LyondellBasell (NYSE: LYB) is one of the largest plastics, chemicals and refining companies in the world.  Driven by its employees around the globe, LyondellBasell produces materials and products that are key to advancing solutions to modern challenges like enhancing food safety through lightweight and flexible packaging, protecting the purity of water supplies through stronger and more versatile pipes, improving the safety, comfort and fuel efficiency of many of the cars and trucks on the road, and ensuring the safe and effective functionality in electronics and appliances.  LyondellBasell sells products into more than 100 countries and is the world’s largest producer of polypropylene compounds and the largest licensor of polyolefin technologies.  In 2021, LyondellBasell was named to Fortune magazine’s list of the “World’s Most Admired Companies” for the fourth consecutive year.  More information about LyondellBasell can be found at www.LyondellBasell.com.

FORWARD-LOOKING STATEMENTS
The statements in this release relating to matters that are not historical facts are forward-looking statements.  These forward-looking statements are based upon assumptions of management of LyondellBasell which are believed to be reasonable at the time made and are subject to significant risks and uncertainties.  When used in this presentation, the words “estimate,” “believe,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “should,” “will,” “expect,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words.  Actual results could differ materially based on factors including, but not limited to, market conditions, the business cyclicality of the chemical, polymers and refining industries; the availability, cost and price volatility of raw materials and utilities, particularly the cost of oil, natural gas, and associated natural gas liquids; uncertainties and impacts related to the extent and duration of the pandemic; competitive product and pricing pressures; labor conditions; our ability to attract and retain key personnel; operating interruptions (including leaks, explosions, fires, weather-related incidents, mechanical failure, unscheduled downtime, supplier disruptions, labor shortages, strikes, work stoppages or other labor difficulties, transportation interruptions, spills and releases and other environmental risks); the supply/demand balances for our and our joint ventures’ products, and the related effects of industry production capacities and operating rates; our ability to manage costs; future financial and operating results; benefits and synergies…

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