Westlake Corporation · NYSE:WLK
Westlake — Investor Day (June 2024)
100 slides from Westlake's investor day presentation, Jun 13, 2024
Slide 1: Welcome: HIP Teach-In
Welcome: HIP Teach-In John Zoeller Vice President and Treasurer June 13, 2024
Slide 2: Agenda
EVERY PIECE MATTERS Agenda 2 Welcome John Zoeller Vice President and Treasurer Every Piece Matters Albert Chao President and Chief Executive Officer Leading Positions Across Diverse End Markets Bob Buesinger Executive Vice President – Housing & Infrastructure Products, IT & Digital Products and Solu
Slide 3: Introduction of the Housing & Infrastructure Products (HIP) Team
EVERY PIECE MATTERS 96 Years Combined Experience at Westlake +212 Years Combined Industry Experience Introduction of the Housing & Infrastructure Products (HIP) Team Every Piece Matters: The Right People in the Right Places 3 Albert Chao President and Chief Executive Officer • 37 years at Westlake •
Slide 4: Every Piece Matters
Every Piece Matters Albert Chao President and Chief Executive Officer
Slide 5: What You Will Hear Today
EVERY PIECE MATTERS What You Will Hear Today 5 1 Westlake’s Housing & Infrastructure Products (HIP) and Performance & Essential Materials (PEM) segments are highly complementary and combined portfolio has significant commercial advantages 2 HIP comprised of robust businesses, with market-leading pos
Slide 6: Westlake's Mission and Values
EVERY PIECE MATTERS Westlake’s Mission and Values 6 Our mission is to serve our customers by safely and reliably producing quality and sustainable products and materials that enhance people’s lives every day HEALTH, SAFETY & ENVIRONMENT (“HSE”) OUR PEOPLE QUALITY & CONTINUOUS IMPROVEMENT COMPETITIVE
Slide 7: Benefits of Integrated HIP and PEM Portfolio
EVERY PIECE MATTERS Benefits of Integrated HIP and PEM Portfolio 7 More Stability in Earnings and Cashflow • PEM and HIP cycles generally do not overlap • HIP provides insight into housing and construction product demand • Vertical integration lowers unit cost production and creates highly reliable
Slide 8: High Degree of Product Integration and Low-Cost Position
EVERY PIECE MATTERS Westlake’s High Degree of Product Integration Combined With Globally Advantaged Low-Cost Position Housing and Infrastructure Products Diversified and Complementary End Products WLK Caustic Soda WLK Chlorine WLK PVC Stone, Metal, Etc… All Ethane Feedstock Capability Chlorinated Pr
Slide 9: Sustainability as a Focus and a Competitive Advantage
EVERY PIECE MATTERS Westlake has reduced total Scope 1 & 2 greenhouse gas emissions intensity by 18%2,3 Goal of reducing Scope 1 & 2 emissions intensity by 20% by 20303 Sustainability as a Focus and a Competitive Advantage 9 (1) We consider a product to be “sustainable” if it improves energy efficie
Slide 10: Committed to Excellence
EVERY PIECE MATTERS Committed to Excellence 10 Accelerate Growth Driving disciplined growth through attractive organic and inorganic opportunities across both segments Created “One Westlake” brand, including products that meet customer needs in a more sustainable way Sustainability Focus Empowering
Slide 11: Westlake Operating System
EVERY PIECE MATTERS 11 Westlake Operating System Core Market Drivers Organic Growth Enhancers Inorganic Growth Opportunities Margin Enhancers Financial Outputs • Investing organically to increase integration • Acquiring assets and technology to access higher value-added products and markets • Achiev
Slide 12: Leading Positions Across Diverse End Markets
Leading Positions Across Diverse End Markets Bob Buesinger Executive Vice President – Housing & Infrastructure Products, IT & Digital
Slide 13: HIP Key Messages
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS Key Messages 13 1 We are building on leading positions across attractive housing and infrastructure markets driven by strong underlying demand fundamentals for new residential construction and repair and remodel activity 2 We deliver superior cus
Slide 14: Housing & Infrastructure Products at a Glance
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS 14(1) Revenue is for the twelve-month period ended March 31, 2024 (2) Current data for Westlake Housing and Infrastructure Products (“HIP”) ~21,800 Customers2 45 Distribution Centers 70 Manufacturing Sites 34 Market Segment / Product Categories ~
Slide 15: End Markets Supported by Favorable Long-term Macro Trends
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS End Markets Supported by Favorable Long-term Macro Trends 15 ANNUAL U.S. HOUSING STARTS (THOUSANDS)1 0 500 1,000 1,500 2,000 2,500 2004 2008 2012 2016 2020 2024E 2028E 2032E 50-Year Average 10+ Years of Underbuilding Supports Favorable Long-Term
Slide 16: Compelling Growth Opportunities Across HIP End Markets
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS Compelling Growth Opportunities Across HIP End Markets 16(1) Overall HIP Total Addressable Market (TAM) based on internal estimates ~$84B TAM1 3%-5% Expected TAM CAGR Capturing share in attractive and steadily growing market • Offering customers
Slide 17: Growth via Acquisitions and Organic Investments
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS $1,100 $1,400 $2,600 $3,800 $4,200 $4,300 $4,600 $8,000 $9,700 HIP Westlake Has Grown Via Acquisitions and Organic Investments to Become a Leader in North American Building Products 17(1) Source: FactSet Substantial growth since 2016 driven by bo
Slide 18: Strong Brands with Expertise Across Attractive Markets
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS Strong Brands with Expertise Across Attractive Markets 18 • Residential housing growth • PVC replacing iron and concrete pipe for water usage • Aging infrastructure and U.S. infrastructure bill spending • Electrification trend • 10+ years of unde
Slide 19: Comprehensive Interior and Exterior Solutions
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS Comprehensive Interior and Exterior Solutions 19 Roofing and Accessories Aluminum and Rainware Windows Shutters, Mounts, and Vents Siding Exterior Trim Stone Veneer Columns Interior Trim Outdoor Living Indoor Pipe and Fittings Decking Municipal P
Slide 20: Partnerships with Builders and Distributors
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS Ability to Leverage Established Partnerships with Builders and Distributors Across HIP Portfolio 20(1) North America, 2021 (2) United States, 2021 (3) 2021 (4) United States, 2019 #1 Concrete Tile1 #1 Plastic Shutters1 #1 Decorative Stone1 #1 Cla
Slide 21: Leveraging Technology to Deliver Innovative Solutions
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS (1) Percent of sales from new products less than three years old Leveraging Technology to Deliver Innovative Solutions and Improve Productivity 21 Current Initiatives Driving Results Westlake Royal Building Products Innovative products to meet cu
Slide 22: Market Leadership through Breadth and Depth of Products
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS Market Leadership through Comprehensive Breadth and Depth of Products and Solutions 22 Large Geographic Footprint in North America Room for Further Expansion Underbuilt Housing Creates Under-Supplied Market Long-Lasting Products Industry-Leading
Slide 23: Infrastructure Bill Additional Growth Tailwind
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS Infrastructure Bill Additional Growth Tailwind Right Assets in Right Locations to Capitalize on Trend 23• Data as of April 2024; source: https://www.whitehouse.gov/build/ • American Society of Civil Engineers rated America’s infrastructure at a C
Slide 24: Case Study: Large Geographic Footprint in North America
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS Case Study | Large Geographic Footprint in North America with Room for Further Expansion 24 OPPORTUNITY Capture market share in growing geographies • Most of North America remains underbuilt on housing • Certain U.S. geographies are experiencing
Slide 25: Case Study: Long-Lasting Products Easy to Install
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS Case Study | Long-Lasting Products that are Easy to Install with Industry-Leading Customer Satisfaction 25 OPPORTUNITY Strong demand from homebuilders for sustainable products that are easy to install • Large demand for building products that are
Slide 26: Case Study: Sustainable Solutions as Differentiators
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS Case Study | Our Sustainable Solutions are Competitive Differentiators 26 OPPORTUNITY Customers want safe, durable products • Municipalities want to ensure longevity of their infrastructure investments • Both housing and infrastructure customers
Slide 27: HIP Key Takeaways
HOUSING & INFRASTRUCTURE PRODUCTS EVERY PIECE MATTERS Key Takeaways 27 1 We are building on leading positions across attractive housing and infrastructure markets driven by strong underlying demand fundamentals for new residential construction and repair and remodel activity 2 We deliver superior cu
Slide 28: Products and Solutions for When Every Piece Matters
Products and Solutions for When Every Piece Matters Scott Szwejbka Vice President – Westlake Royal Building Products
Slide 29: Royal Building Products Key Messages
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS Key Messages 29 1 We are a leading provider of building products and solutions for every house, including interior and exterior applications that deliver value and performance with durability and aesthetics 2 We have significant exposure to long-t
Slide 30: Royal Building Products At-a-Glance
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS 30 Royal Building Products At-a-Glance ~18,000 Customers2 41 Manufacturing Sites 20 Product Categories ~30,400 SKUs ~5,300 Employees Strong housing construction demand and steady growth in repair and remodel spend Partnerships with nationwide home
Slide 31: Favorable Long-Term Housing Demand Trends
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS Well-Positioned to Capitalize on Favorable Long-Term Housing Demand Trends 31 • Positive underlying market drivers are providing tailwinds for the business • Demographic trends support long-term growth in housing starts • U.S. is underbuilt on sin
Slide 32: Repair and Remodel Activity Expected to Deliver Durable Growth
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS 0 100 200 300 400 500 600 700 2007 2012 2017 2022 2027E Repair and Remodel Activity Expected to Deliver Durable Growth Bolstered By Secular Trends 32 U.S. RESIDENTIAL REPAIR & REMODELING ($B)1• Homeowners are looking for high-value products to mak
Slide 33: Accretive Acquisitions and Innovative New Products
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS Founded Royal Building Products, first products were in vinyl window extrusions 1970 Launched Foundry Shake Products Patented, low- cost polymer shake side wall that is realistic and panelized 1998 Marley Mouldings Acquisition Producer of cellular
Slide 34: Broad Range of Products Across Essential Categories
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS Driving Value Through Broad Range of Products and Solutions Across Essential Building Product Categories 34 Leading products across key categories delivers value to buyers, homebuilders, and distributors, enabling cross-selling opportunities Sidin
Slide 35: Relationships with National Builders and Distributors
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS Leveraging Relationships with National Builders and Distributors to Expand Market Share and Increase Cross-Selling 35 Prominent Customers Across North America • Expanding product portfolio and geography leads to larger share of customer spend (pul
Slide 36: Using Technology to Enhance Customer Experience
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS Using Technology to Enhance Customer Experience 36 • Using advanced AI to allow customer to preview all product styles and colors of their home from their phone or tablet • Ability to select type, texture, and color to match desired style • Automa
Slide 37: Significant Cross-Selling Opportunities
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS Significant Cross-Selling Opportunities 37 Through Product IntegrationThrough Building Products Acquisitions Portfolio Expansion Focused on exterior building materials as well as finding interior spaces for products like trim and stone Adding more
Slide 38: Case Study: Low Maintenance Products
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS Case Study | Delivering Solutions to Meet Increasing Demand for Low Maintenance Products 38 OPPORTUNITY Low maintenance becoming an increasingly important factor when purchasing building products • Exterior products, such as roofing and siding, mu
Slide 39: Case Study: Automation to Increase Efficiency
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS Case Study | Using Automation to Increase Operational Efficiency and Reduce Costs 39 OPPORTUNITY Trends in labor rates and availability have driven need for alternative solutions • Rising labor rates pressure margins • Difficult environment to att
Slide 40: Case Study: DaVinci Roofing
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS Case Study | DaVinci Roofing Offers Superior Durability and Low Maintenance 40 OPPORTUNITY Roof material needs to be durable and low maintenance with lasting curb appeal • Certain environments, such as areas prone to harsh winters, high wind, and
Slide 41: Case Study: Sustainable and Energy Efficient Products
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS 41 OPPORTUNITY Environmentally conscious consumers seek products that are sustainable and energy efficient • Low environmental impact in production of building products • Components that will reduce energy consumption for heating and cooling SOLUT
Slide 42: Growth Drivers and Opportunities
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS Growth Drivers and Opportunities 42 Economic Growth • U.S. GDP Building Products Growth • Underbuilt housing • Favorable demographics • Aged housing • Repair and remodel growth Organic Share Growth • Organic investments • Innovations • Cross-selli
Slide 43: Royal Building Products Key Takeaways
WESTLAKE ROYAL BUILDING PRODUCTS EVERY PIECE MATTERS 43 1 We are a leading provider of building products and solutions for every house, including interior and exterior applications that deliver value and performance with durability and aesthetics 2 We have significant exposure to long-term secular d
Slide 44: Differentiated Producer of Superior PVC and PVCO Pipe and Fittings
+ Differentiated Producer of Superior PVC and PVCO Pipe and Fittings Andre Battistin Vice President – Westlake Pipe and Fittings + + + + + +
Slide 45: Pipe & Fittings Key Messages
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS Key Messages 45(1) See PVCO explanations on pages 59 and 60 1 We are one of the nation’s largest providers of PVC-based water management solutions to a variety of municipal, infrastructure, and residential end markets 2 We serve water infrastructure marke
Slide 46: Pipe and Fittings At-a-Glance
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS Pipe and Fittings At-a-Glance 46 (1) John Burns Research and Consulting, LLC (April 2024) (2) National Association of Home Builders (NAHB) (3) Current data for Westlake Housing and Infrastructure Products (“HIP”) STRATEGIC FOOTPRINT ~2,700 Customers3 15 D
Slide 47: Heritage of Leadership in Pipe and Fittings
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS Acquisitions • Acquired first PVC pipe plant in Wichita Falls, TX • Added PVC pipe production with plants in Janesville, WI, Booneville, MS, Yucca, AZ, and Leola, PA 1993–2009 Acquisition Acquired CertainTeed’s business with PVC pipe production in McPhers
Slide 48: Leading Market Position with Attractive Growth Opportunities
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS 81% 19% Pipe Fittings Leading Market Position with Attractive Growth Opportunities 48 (1) Utah State study (2) Unibell Life Cycle Assessment / Chris DeArmitt Plastics Distraction PPI 2022 (3) Total Addressable Market (TAM) and projected market growth base
Slide 49: Integrated Pipe and Fitting Solutions for Water Management
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS A Leading Provider of Integrated Pipe and Fitting Solutions for Water Management Ecosystem 49 • Large diameter water and sewer transmission lines for new housing developments • Fabricated fittings connect larger-diameter municipal lines to small-diameter
Slide 50: Positioned to Capitalize on Growing Housing Demand
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS (1) National Association of Home Builders (NAHB) Long-Term Housing Forecast (2) U.S. Census Bureau Positioned to Capitalize on Growing Housing Demand ANNUAL U.S. HOUSING STARTS (THOUSANDS)1 0 500 1,000 1,500 2,000 2,500 2004 2008 2012 2016 2020 2024E 2028
Slide 51: Infrastructure Spending to Address Investment Gap in Water Systems
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS 51(1) Source: American Society of Civil Engineers 2021 Report Card for America’s Infrastructure Infrastructure Spending to Address Growing Investment Gap in Vital Water Systems Right Assets in Right Locations to Capitalize on Trend ASCE INFRASTRUCTURE GRA
Slide 52: Developing Innovative Solutions for Agricultural Needs
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS 52(1) Acres irrigated with ‘solid set’ sprinkler irrigation (2) Source: USDA National Agricultural Statistics Service 454,924 58,051 88,463 253,939 CA AZ OR WA ACRES IRRIGATED1,2 Developing Innovative Solutions to Meet Agricultural Needs • Irrigation is r
Slide 53: North American Footprint and Distribution Advantages
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS Robust North American Footprint and Distribution are Competitive Advantages 53 • Large diameter pipe typically sold within 500 miles of production site given high shipping cost • Westlake’s broad and geographically well-placed production footprint enables
Slide 54: Unparalleled Base of Satisfied, Repeat Customers
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS Unparalleled Base of Satisfied, Repeat Customers 54(1) Voice of Customer Analysis March 29, 2024 84% 85% 84% 74% 75% 72% Customer Service Sales Experience Product Offerings VOICE OF CUSTOMER ANALYSIS1 Westlake Pipe & Fittings Combined Competitors Customer
Slide 55: Integrated Solutions Through Best-in-Class Technology
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS Providing Integrated Solutions Through Best-in-Class Technology 55 Robust product development funnel concentrated on innovation pillars of Systems, Connectivity & Sustainability Focused on materials development and optimization improvement Continuous impr
Slide 56: Technology Leader Across Wide Array of End Markets
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS Technology Leader Across a Wide Array of End Markets 56 • We provide system solutions across our end markets, not just individual components • Innovative and integrated technologies such as PVCO, Certa-Lok, and Swing Joints deliver engineered systems to s
Slide 57: Case Study: PVC as Superior Pipe Material
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS Case Study | PVC is Superior Material for New and Replacement Pipe Installation 57 (1) Molecularly Oriented PVC (2) Life cycle phases (production, transport, installation, and use) among PVC, HDRE, ductile iron, and concrete pipes; Unibell Life Cycle Asse
Slide 58: Case Study: PVCO Pipe Sustainable Product
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS Case Study | PVCO Pipe: Sustainable Product that Provides a Strong Competitive Advantage in the Market 58 (1) Unplasticized Polyvinyl Chloride (2) Voice of Customer Analysis March 29, 2024 (3) Traditional Westlake PVC OPPORTUNITY Customers want to achieve
Slide 59: Case Study: The Certa-Lok Advantage
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS Case Study | The Certa-Lok Advantage: The Benefit of Restrained Joint Pipe 59 RESULTS Customers choosing Certa-Lok, resulting in incremental sales • Oklahoma City needed to quickly replace a damaged 18-inch steel potable water pipeline that was on an aeri
Slide 60: Growth Drivers and Opportunities
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS 60 Growth Drivers and Opportunities Economic Growth • U.S. GDP HIP Market Growth • Underbuilt housing • Favorable demographics for housing demand • Infrastructure Bill spend • Aging infrastructure replacement need • Growing agricultural irrigation demand
Slide 61: Pipe & Fittings Key Takeaways
WESTLAKE PIPE & FITTINGS EVERY PIECE MATTERS Key Takeaways 61(1) See PVCO explanations on pages 59 and 60 Key Takeaways 1 We are one of the nation’s largest providers of PVC-based water management solutions to a variety of municipal, infrastructure, and residential end markets 2 We serve water infra
Slide 62: Value-Added and Differentiated Platform
Value-Added and Differentiated Platform Renee Havrilla Vice President – Westlake Global Compounds
Slide 63: Global Compounds Key Messages
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Key Messages 63 1 We are one of the largest global suppliers of specialty compounds serving diverse and attractive end markets of building products, consumer goods, automotive, and healthcare 2 We have the technical capabilities to offer highly customiza
Slide 64: Global Compounds At-a-Glance
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Global Compounds At-a-Glance 64(1) Revenue is for the twelve-month period ended March 31, 2024 (2) Current data for Westlake Housing and Infrastructure Products (“HIP”) 1,605 Compounds2 12 R&D Facilities 60 Countries Served 14 Manufacturing Sites 1,150 C
Slide 65: Accelerating Growth through Industry Tailwinds
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Accelerating Growth through Attachment to Industry Tailwinds (1) Total Addressable Market (TAM) and projected market growth based on internal estimates $3.2B TAM1 4%-6% Overall Global Compounds Market Expected CAGR1 65 • Robust demand across primary end
Slide 66: Increasing Scale Through Organic and Inorganic Growth
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Increasing Our Leading Scale Across Diverse End Markets Through Organic and Inorganic Growth 66 Axiall Acquisition • 4 NA plants and R&D lab • Rigid, powder, and flexible compounds • Electrification, building & construction, industrial, and packaging mar
Slide 67: Innovative Solutions for Complicated Needs
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Providing Innovative Solutions for Complicated Needs Across Attractive Markets 67(1) Percent of sales from new products less than three years old Offering Customers Breadth of Highly Customized and Innovative Solutions • Extremely skilled research team,
Slide 68: Unique and Growing Geographic Footprint
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Unique and Growing Geographic Footprint to Support Global Customer Base 68 STRATEGIC FOOTPRINT • Operations, technical support centers, and research & innovation laboratories strategically located near key markets and customers • Provides flexibility to
Slide 69: Differentiated Solutions to Broad Range of Customers
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Delivering Differentiated Solutions to Broad Range of Customers 69 “They are the most consistent supplier around.” Industrial Materials Customer “Westlake has high product performance, they deliver on time, and their support teams are all available.” Wir
Slide 70: Technology Leader in Specialized Markets
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Technology Leader in Specialized Markets 70 • Attractive markets: • Unique IP and product specifications • Harder for smaller players to supply highly regulated products (e.g., automotive instrument panels, specialized wire & cable, medical devices) • Sp
Slide 71: Case Study: Growing Share in Specialized Products
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Case Study | Growing Share in Specialized Products and Applications 71 OPPORTUNITY Develop specialized products with substantial barrier to entry for competitors • Demand for enhancing current compounds for superior performance and to meet customer’s sus
Slide 72: Case Study: Recycled Plastic Products
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS 72 OPPORTUNITY Divert plastic waste from landfills • Post-industrial and post- consumer PVC and other plastic materials can be recycled • Reduce plastic waste by recycling to increase post- industrial and post consumer material usage SOLUTION Manufacture
Slide 73: Case Study: Pilot-Testing Single-use Medical Waste Recycling
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Case Study | Pilot-Testing Single-use Medical Waste Through Differentiated Mechanical Recycling 73 OPPORTUNITY Medical institutions are one of the leading consumers of single- use plastic • Mainstream plastic recycling workflows not acceptable for medica
Slide 74: Case Study: AI in R&D for Faster Compound Development
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS 74 OPPORTUNITY Growing demand for specialty compounds to quickly meet precise specifications and improve the overall customer experience • Specialty applications and new customers within existing markets require new compound development • Shortening of a
Slide 75: Growth Drivers and Opportunities
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Economic Growth • Global GDP Housing, Medical, and Automotive Growth • Underbuilt housing and infrastructure • Favorable demographics for housing demand • Growing medical needs from aging population • Increasing EV, electrification, and connectivity dema
Slide 76: Global Compounds Key Takeaways
WESTLAKE GLOBAL COMPOUNDS EVERY PIECE MATTERS Key Takeaways 76 Key Takeaways 1 We are one of the largest global suppliers of specialty compounds serving diverse and attractive end markets of building products, consumer goods, automotive, and healthcare 2 We have the technical capabilities to offer h
Slide 77: Delivering Shareholder Value
Delivering Shareholder Value Steve Bender Executive Vice President and Chief Financial Officer
Slide 78: Strong Financials and Balance Sheet With Leadership Positions
EVERY PIECE MATTERS 80% 20% N. America International 65% 35% PEM HIP A Leading Producer of North American Building Products as Well as Performance-Oriented and Essential Materials FINANCIAL PERFORMANCE1 BALANCE SHEET & CASH FLOW1 $12.2B Sales 0.62x Net Debt to EBITDA2 $2.3B EBITDA2 ~16 Years Avg. De
Slide 79: Strategic Pillars of Westlake Corporation
EVERY PIECE MATTERS Strategic Pillars of Westlake Corporation 79 More Stability in Earnings & Cashflow • PEM and HIP generally have different cycles and margin drivers, which helps to dampen overall earnings volatility • HIP is less capital intensive than PEM, which improves ROA/ROCE • HIP is less c
Slide 80: Historical HIP Performance
EVERY PIECE MATTERS Historical HIP Performance 80(1) Please see the reconciliations included in the appendix to this presentation for reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures $1.9 $2.1 $3.1 $4.8 $4.2 13.5% 18.5% 17.2% 20.0% 22.5% 2019 2020 2021 202
Slide 81: Updating FY2024 HIP Guidance
EVERY PIECE MATTERS Updating FY2024 HIP Guidance Based on Strength in Business 81 Record 1Q 2024 EBITDA and EBITDA margin driven by solid sales volume growth, lower materials costs, improved sales mix, and cost-saving actions compared to 1Q 2023 Solid 14% YoY sales volume growth reflects the strong
Slide 82: Housing and Infrastructure Products Update
EVERY PIECE MATTERS Housing and Infrastructure Products Update 82 Longer-term fundamentals for housing strength remain intact due to decade- plus of underbuilding, increasingly favorable demographics, and remote work popularity Leading positions in key markets enabling HIP to capitalize on resilient
Slide 83: Investment Criteria to Drive Growth
EVERY PIECE MATTERS Investment Criteria to Drive Growth 83(1) We consider a product to be "sustainable" if it improves energy efficiency, reduces material consumption, increases use of renewable power and/or feedstock, or contributes to a circulate economy Supporting Key Attributes Strategic Filters
Slide 84: A Proven Strategy of Creating Value
EVERY PIECE MATTERS A Proven Strategy of Creating Value 84 Vertically Integrated, Globally Advantaged Robust Shareholder Value North America Focused Branded Products Superior Stewards of Capital Integrated chain supported by a well invested production footprint with a globally advantaged low-cost po
Slide 85: Westlake's History of Delivering Strong Financial Results
EVERY PIECE MATTERS Westlake’s History of Delivering Strong Financial Results 85 (1) Please see the reconciliations included in the appendix to this presentation for reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures (2) Source: FactSet: Chemical Peers inclu
Slide 86: Delivering Outsized Shareholder Returns
EVERY PIECE MATTERS Delivering Outsized Shareholder Returns 86Source: FactSet, beginning August 11, 2004, and as of May 31, 2024 SHARE PRICE PERFORMANCE SINCE IPO (Indexed to 100)* 0 500 1,000 1,500 2,000 2,500 3,000 2004 2008 2012 2016 2020 WLK S&P 500 Index S&P MidCap 400 Building Products Index S
Slide 87: Growth and Profitability Compared with Selected Peers
EVERY PIECE MATTERS Growth and Profitability Compared with Selected Peers 87 Strong Operating Performance Driving Above-Average Margins -8.7% -2.5% 0.5% 3.5% 7.0% 7.1% 7.5% 13.1% 15.1% FBIN LPX JELD MAS HIP OC TREX JHX AZEK 2020-2023 REVENUE CAGR1 8.2% 17.9% 18.3% 18.6% 22.0% 22.5% 24.6% 28.0% 29.8%
Slide 88: History of Maintaining A Strong Balance Sheet
EVERY PIECE MATTERS Westlake History of Maintaining A Strong Balance Sheet 88 (1) Please see the reconciliations included in the appendix to this presentation for reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures (2) Source: Bloomberg, Chemical Peers includ
Slide 89: Every Piece Matters: Building Long-Term Growth
EVERY PIECE MATTERS 89 Every Piece Matters: Building Long-Term Growth Organic Growth Drivers • Investments in technical capabilities and innovation to solve customer needs • Extensive footprint to serve customers • Robust and integrated supply chain, including products with recycled content • Growin
Slide 90: Summary
EVERY PIECE MATTERS Summary 90 1 Westlake’s Housing & Infrastructure Products (HIP) and Performance & Essential Materials (PEM) segments are highly complementary and combined portfolio has significant commercial advantages 2 HIP comprised of robust businesses, with market-leading positions across We
Slide 91: Westlake
Westlake
Slide 92: Appendix
MAD. Appendix eS il ~~ Westlake
Slide 93: Forward-Looking Statements
EVERY PIECE MATTERS Forward-Looking Statements 93 This presentation contains certain forward-looking statements including statements regarding our cost savings objectives and our ability to maintain synergies, pricing and demand for our products, global macroeconomic conditions, anticipated sales vo
Slide 94: Use of Non-GAAP Financial Measures
EVERY PIECE MATTERS Use of Non-GAAP Financial Measures 94 This presentation makes reference to certain “non-GAAP financial measures” as defined in Regulation G of the U.S. Securities Exchange Act of 1934, as amended. For this purpose, a non-GAAP financial measure is generally defined by the Securiti
Slide 95: Financial Reconciliations
Financial Reconciliations
Slide 96: Reconciliation of Westlake EBITDA to Net Income and Cash Flow
EVERY PIECE MATTERS Reconciliation of Westlake EBITDA to Net Income and to Cash Flow from Operating Activities 96 (in $ millions) Non-GAAP Financial Measures This presentation includes the non-GAAP measure EBITDA. A reconciliation to net income and to cash flow from operating activities is included
Slide 97: Reconciliation of EBITDA excl. Identified Items
EVERY PIECE MATTERS Net cash provided by operating activities $ 169 $ 512 $ 573 Changes in operating assets and liabilities and other Deferred income taxes Net income (loss) Less: Other income, net Interest expense Provision for income taxes Income (loss) from operations Add: Depreciation and amorti
Slide 98: Reconciliation of Net Income and Earnings Per Share
EVERY PIECE MATTERS Net income (loss) $ 185 $ 407 $ (487) Less: Net income attributable to noncontrolling interests Net income (loss) attributable to Westlake Corporation 174 394 (497) Add: Impairment charge, after-tax Litigation settlement charge of $150 million, after-tax Net income attributable t
Slide 99: Consolidated Statements of Operations
EVERY PIECE MATTERS Consolidated Statements of Operations 99 Performance and Essential Materials Sales $ 1,931 $ 2,349 $ 1,880 Housing and Infrastructure Products Sales 1,044 1,007 946 Net sales 2,975 3,356 2,826 Cost of sales Gross profit Selling, general and administrative expenses Impairment of g
Slide 100: Reconciliation of Segment EBITDA to Operating Income
EVERY PIECE MATTERS Reconciliation of PEM EBITDA excl. Identified Items, HIP EBITDA and Corporate EBITDA to Operating Income (Loss) 100 Three months ended March 31, Three months ended December 31, 2024 2023 2023 Performance and Essential Materials EBITDA excl. Identified Items $ 253 $ 615 $ 201 Less