LyondellBasell Industries NV · NYSE:LYB
LyondellBasell Industries NV — Barclays Capital 2012 Industrial Select Conference
34 slides from LyondellBasell Industries NV's conference presentation, Feb 22, 2012
Slide 1: Barclays Capital 2012 Industrial Select Conference
Barclays Capital 2012 Industrial Select Conference Sergey Vasnetsov, SVP Strategic Planning & Transactions February 22, 2012
Slide 2: Information Related to Financial Measures
Information Related to Financial Measures • We have included EBITDA , adjusted EBITDA and adjusted net income in this presentation, which are non-GAAP measures. However, EBITDA, as presented herein, may not be comparable to a similarly titled measure reported by other companies due to differences in
Slide 3: Cautionary Statement
Cautionary Statement • The information in this presentation includes forward-looking statements. These statements relate to future events, such as anticipated revenues, earnings, business strategies, competitive position or other aspects of our operations or operating results. Actual outcomes and re
Slide 4: World-Class Scale
World-Class Scale 2010 Revenues ($ in billions) $100 80 60 40 20 0 BASF Dow LYB SABIC DuPont 2011 Sales 2011 EBITDA Technology Technology 1% Refining & 4% O&P Americas Oxyfuels 20% 18% O&P Americas Refining & 40% Oxyfuels 37% Intermediates & O&P EAI Derivatives 29% 20% Intermediates & O&P EAI Deriva
Slide 5: Leading Market Positions
Leading Market Positions Global Products Position Chemicals Ethylene #5 Propylene #4 Propylene Oxide #2 Polymers Polyolefins (PE + PP) #1 Polypropylene #1 Polyethylene #4 Polypropylene Compounds #1 Refining & Oxyfuels Oxyfuels #1 Technology and R&D Polyolefins Licensing #3 Polypropylene Catalysts #1
Slide 6: Success Driven by Actions and Assets
Success Driven by Actions and Assets $5.4 billion • Improving market conditions • Cost reduction • Operational improvement $2.2 billion • Asset restructuring • Gap closure plans • U.S. feedstock advantage • Heavy crude advantage • Differentiated products • Joint venture improvements 2009 2011 EBITDA
Slide 7: "Back-To-Basics" Strategy Drives Value
“Back-To-Basics” Strategy Drives Value Our Strategy Our Results • Operational excellence • Significantly improved safety, process and environmental performance • Cost reduction / revenue • Maintaining fixed costs flat to down enhancement • Existing assets are first priority • Capital discipline • Ex
Slide 8: 2011 Accomplishments
2011 Accomplishments Overall Finance and Legal Manufacturing Commercial • Expanded number of • Capital restructuring • Increased U.S. ethane • Defined North American Independent Supervisory • $2.9 billion cash generated feedstock capabilities by olefins expansion and feed Board members from operatio
Slide 9: Strong LYB Results in Global Trough
Strong LYB Results in Global Trough Global Ethylene Effective Operating Rates 100% 95% 90% 85% Trough Peak Trough 80% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011E Global Refining Operating Rates 86% 84% 82% 80% 78% Trough Peak Trough 76% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2
Slide 10: Price Increases Benefiting Certain Businesses
Price Increases Benefiting Certain Businesses U.S. Gulf Coast Spot Ethylene Pricing and Margin Recent Price Movements (¢/lbs.) 80 50 North America Contract Propylene 70 40 Jan Feb 60 30 - +16.5 ¢/lb 50 20 Contract Butadiene Jan Feb 40 10 +7 ¢/lb +14 ¢/lb 30 0 Contract Benzene 7/1/2011 8/1/2011 9/1/2
Slide 11: Olefins & Polyolefins - Americas Overview
Olefins & Polyolefins - Americas Overview Product Capacities and Positions • Leading olefins position Product Capacity(1) NA Ranking Light Olefins 9.6 Bn lbs (ethylene) #1 Polypropylene 4.4 Bn lbs #1 Polyethylene 5.8 Bn lbs #3 • Significant ethane processing EBITDA(2) capability ($ in millions) $2,5
Slide 12: Where are We in the Ethylene Cycle?
Where are We in the Ethylene Cycle? Effective Ethylene Operating Rates Regional Cost of Ethylene Production (cents / lb) 100% 70 95% 60 90% 50 85% 40 projections 80% 30 75% 20 North America North America ethane World 70% 10 North America co-product integrated naphtha Northeast Asian spot naphtha 65%
Slide 13: Positive Outlook for U.S. Ethane Supply
Positive Outlook for U.S. Ethane Supply U.S. Ethane Supply / Demand Forecast U.S. Infrastructure Capacity Additions (MBbls / Day) (MBbls / Day) 920 1,500 400 Forecast NGL Fractionation 1,200 300 NGL Pipeline 900 Demand 200 600 Supply 100 300 0 0 2005 2007 2009 2011E 2013E 2015E 2011E 2012E 2013E 201
Slide 14: Growth and Efficiency Projects
Growth and Efficiency Projects Investment Timing Value Scope ($ million) (year) ($ million / year) Increase 500 MM Lbs Ethane ~$25 2012 $50 -$100 Capability ethylene Expand 850 MM Lbs La Porte ~$350 2014 $125 - $250 Cracker ethylene Expand Flex 500 MM Lbs Capacity ~$125 2014 $75 - $125 propylene 100
Slide 15: Olefins & Polyolefins - Europe, Asia, International
Olefins & Polyolefins - Europe, Asia, International Product Capacities and Positions Product Capacity(1) W.E. Ranking(2) • Solid olefins position Ethylene 6.4 Bn lbs #7 Butadiene 550 Mn lbs #4 Polypropylene 12.4 Bn lbs #1 Polyethylene 7.2 Bn lbs #1 • Leading polyolefins position PP Compounding 2.4 B
Slide 16: O&P EAI Earnings Drivers
O&P EAI Earnings Drivers EU Olefins • High cost on global basis O&P EAI EBITDA Scenarios EU Polyethylene • Large consuming market 2.0 EU Polypropylene • Cyclical profit Indexed, Mid-Cycle = 1.0 1.5 • Light cracking in US EU Butadiene EBITDA • Europe, net exporter of C4’s 1.0 • Feedstock advantage Jo
Slide 17: EAI Restructuring – Increasing Earnings
EAI Restructuring – Increasing Earnings • Increase efficiency by moving many functions to The Focus business Netherlands management processes • Maximize value from existing assets • Differentiate service between specialty and commodity Segment markets and segments customers • Optimize cost-to-serve
Slide 18: Robust and Diversified Portfolio
Robust and Diversified Portfolio Intermediates & Derivatives 2011 Revenue $ 6,487 million 2011 EBITDA $ 1,054 million Propylene Oxide TBA & Ethylene Oxide Acetyls Styrene & Derivatives Intermediates & Derivatives Capacity(1): Capacity: Capacity: Capacity: Capacity(1): 2.6 billion lbs 1.4 billion lbs
Slide 19: Global Propylene Oxide Industry Supply / Demand
Global Propylene Oxide Industry Supply / Demand 14 100% 12 90% 10 Global Effective Operating Rate @ 96% On-stream 80% Volume, KT (thousands) Effective Operating Rate 8 70% Effective Capacity 6 60% Demand 4 50% 2 40% 0 30% 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011E 2012E 2013E 2014E 2015E • S
Slide 20: High Return Growth and Earnings Potential
High Return Growth and Earnings Potential ($ millions) 1,600 Propylene Oxide Expansion • $70 - 90 million annual dividend 1,200 Methanol Restart 800 • $130 - 150 million annual EBITDA 400 Operating Efficiency • $70 - 90 million annual EBITDA 0 20112011 EBITDA Methanol Asia PO/TBA Efficiency Near Nea
Slide 21: LYB Refining & Oxyfuels Business Overview
LYB Refining & Oxyfuels Business Overview Capacities barrels / day Botlek, Houston Refinery 268,000 Fos-sur-Mer, France The Netherlands Oxyfuels plant Oxyfuels plant Berre Refinery 105,000 ETBE / MTBE ETBE Oxyfuels 75,000 EBITDA(1) Berre l’Etang, France ($ in millions) Berre Refinery $1,500 1,200 90
Slide 22: Houston Refinery Benefits from Excellent Configuration
Houston Refinery Benefits from Excellent Configuration Maya 2-1-1 Crack Spread Houston Crude Oil Processing Rates ($ / Bbl) (MBPD) Nameplate $30 300 capacity: 268 MBPD 25 250 20 200 15 150 10 100 5 50 0 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2008 2009 2010 Q1 '11 Q2 '11 Q3 '11 Q4 '11 Light C
Slide 23: Improving Performance at Houston Refinery
Improving Performance at Houston Refinery Potential Value Improvement Timing Cost Progress ($MM/yr)(1) 1. Returning to 2005-2007 full operating rates 2011-2012 Minor capital $125 2. Improve yield to clean fuels – Fluid Catalytic 2011 <$25 million incremental $20 Cracking Unit turnaround 3. Impro
Slide 24: Addressing Priorities for Capital Deployment
Addressing Priorities for Capital Deployment Priorities at Time of Emergence Current / Future Considerations • Maintenance capital Maintenance capital • Liquidity • Liquidity • Performance improvement capital • Performance improvement capital • Debt reduction: planned for 2012-2013 • Debt red
Slide 25: Interest Expense Continues to Decrease
Interest Expense Continues to Decrease Net Interest Expense(1) 2011 Interest / EBITDA(1) ($ million) $1,000 25% $800 20% $600 15% Potential Scenarios $400 10% $4 B @ 6% $4 B $200 @ 4% 5% $0 0% '10 '11 '12E Near Future LYB LYB Peer Peer Peer Peer Term PF A B C D Decreasing interest expense leads to h
Slide 26: Returning Cash to Shareholders Through Dividends
Returning Cash to Shareholders Through Dividends LYB Regular Dividend History Dividend Yield(1) $0.40 4% Target Range $0.30 3% $0.20 2% $0.10 1% $0.00 0% 2Q'11 3Q'11 4Q'11 LYB Peer A Peer B Peer C Peer D Growing regular dividend with a target range of 3-4% yield Source: Capital IQ. Note: Peers are D
Slide 27: Strategy, Execution and Assets Drive Outperformance
Strategy, Execution and Assets Drive Outperformance “Back-to-Basics” Strategy and Actions • $5.4 Bn 2011 Adj. EBITDA • $2.7 Bn 2011 Adj. Net Income Industry • $5.8 Bn Cash Flow from Conditions Operations since emergence • 190% total return to shareholders(1) Differentiated Assets (1) Based on emerge
Slide 28: Operational and Financial Improvements
Operational and Financial Improvements Houston Refinery Yield & Throughput Potential Pre-Tax Berre Refinery Earnings Shutdown O&P - EAI $700 - $900 Reorganization million per & Improvements year by 2013(1) Improve Capital Structure Minimal investment for high return (1) Company estimate based on his
Slide 29: Significant High-Return Growth Opportunities
Significant High-Return Growth Opportunities Olefins Feedstock Flexibility Olefins Debottlenecks Potential Co-Product Flexibility Projected Pre-Tax Spending Earnings Propylene Oxide JV $1,300 - $1,500 $800 - $1,000 PP Compounding Growth million million per year by 2016(1) Methanol Restart Other Quic
Slide 30: Industry Trends Provide Further Upside
Industry Trends Provide Further Upside Olefins Cycle Potential Pre-Tax Ethane Supply / Earnings Through Demand the Cycle ~$2 - $3 billion / year Refining Industry Rationalization & Feedstock Flexibility lyondellbasell.com 30 Barclays Capital 2012 Industrial Select Conference
Slide 31: Performing Today and Growing Tomorrow
Performing Today and Growing Tomorrow Efficiency and Cost Control • $5.4 Bn 2011 Adj. EBITDA Growth Projects • $2.7 Bn Adj. Net Income • $5.8 Bn Cash Flow from Operations since Capital Structure emergence • 190% total return to Industry Upcycle shareholders(1) Multiple Expansion (1) Based on emergen
Slide 32: 2009 Reconciliation of EBITDA to Net Income
2009 Reconciliation of EBITDA to Net Income Table 9 – Reconciliation of EBITDAR to Net Income Predecessor 2009 (Millions of U.S. dollars) Q1 Q2 Q3 Q4 YTD Segment EBITDAR: (a) Olefins and Polyolefins - Americas $ 20 $ 207 $ 272 $ 244 $ 743 Olefins and Polyolefins - Europe, Asia, International (5) 109
Slide 33: 2010 Reconciliation of EBITDA to Net Income
2010 Reconciliation of EBITDA to Net Income Table 9 - Reconciliation of EBITDA to Net Income Predecessor Successor Combined Successor Predecessor Successor Combined 2010 April 1 - May 1 - January 1 - May 1 - (Millions of U.S. dollars) Q1 April 30 June 30 Q2 Q3 Q4 April 30 December 31 YTD (a) Segment
Slide 34: 2011 Reconciliation of EBITDA to Net Income
2011 Reconciliation of EBITDA to Net Income Table 9 - Reconciliation of EBITDA to Net Income Successor 2011 (Millions of U.S. dollars) Q1 Q2 Q3 Q4 YTD Segment EBITDA: Olefins & Polyolefins - Americas $ 484 $ 578 $ 673 $ 407 $ 2,142 Olefins & Polyolefins - Europe, Asia, International 333 275 261 62 9
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