Westlake Corporation · NYSE:WLK
Westlake — Q3 2023 Earnings Presentation
15 slides from Westlake's earnings presentation, Nov 2, 2023
Slide 1: Earnings Presentation 3Q 2023
Earnings Presentation 3Q 2023 1
Slide 2: Third Quarter 2023 Highlights
Third Quarter 2023 Highlights 3Q 2023 Financial Results Record Housing and Infrastructure Products (HIP) segment earnings provide stability $285M $3.1B $682M Net Income Net Sales EBITDA(1) 4% decrease vs. 2Q 4% decrease vs. 2Q 1% decrease vs. 2Q $2.20 $3.1B $451M Net Income Per Share Cash and Equiva
Slide 3: Westlake Corporation 3Q 2023
Westlake Corporation 3Q 2023 Record HIP segment quarterly EBITDA of $327 million as lower material costs combined with QoQ volume growth to drive record HIP EBITDA margin of 29% ($ in millions) 3Q'23 2Q'23 QoQ% 3Q'22 YoY% Sales $3,115 $3,251 (4%) $3,956 (21%) Sequential sales volume growth in each s
Slide 4: Benefits of a Combined PEM & HIP Portfolio
Benefits of a Combined PEM & HIP Portfolio More Stability in Earnings & Cashflow Vertically • PEM and HIP have different cycles and margin drivers Integrated • HIP provides captive off-take for PEM improving operating rates and domestic sales mix • Vertical integration lowers unit cost production an
Slide 5: Housing and Infrastructure Products (HIP) Segment Performance
Housing and Infrastructure Products (“HIP”) Segment Performance Sequentially higher sales volume driven by solid demand growth for ($ in millions) 3Q'23 2Q'23 QoQ% 3Q'22 YoY% Pipe & Fittings and Siding & Trim Housing Products Sales $963 $918 5% $1,018 (5%) Infrastructure Products Sales $181 $197 (8%
Slide 6: Housing and Infrastructure Products Update
Housing and Infrastructure Products Update 1 Strong demand growth for Pipe & Fittings and Siding & Trim products drove higher sequential sales volume despite continued challenges to residential housing demand from elevated mortgage rates 2 Decreases in material costs more than offset lower average s
Slide 7: Performance and Essential Materials (PEM) Segment Performance
Performance and Essential Materials (“PEM”) Segment Performance Lower average sales price on both a QoQ and YoY basis, particularly for ($ in millions) 3Q'23 2Q'23 QoQ% 3Q'22 YoY% caustic soda and PVC resin, due to Performance Materials Sales $1,127 $1,140 (1%) $1,689 (33%) weak global demand result
Slide 8: Performance and Essential Materials Update
Performance and Essential Materials Update 1 Weak global demand drove lower average sales price compared to both the prior-quarter and prior-year periods, particularly for caustic soda, PVC resin and epoxy 2 Feedstock and energy costs were a headwind to margins compared to the second quarter, primar
Slide 9: Financial Reconciliations
Financial Reconciliations 9 9
Slide 10: Consolidated Statements of Operations
Consolidated Statements of Operations Three months ended Three months ended September 30, Nine months ended September 30, June 30, 2023 2022 2023 2023 2022 (In millions of dollars, except per share data) Performance and Essential Materials Sales $ 1,971 $ 2,711 $ 2,136 $ 6,456 $ 8,647 Housing and In
Slide 11: Reconciliation of EBITDA to Net Income, Income from Operations and Net Cash Provided by Operating Activities
Reconciliation of EBITDA to Net Income, Income from Operations and Net Cash Provided by Operating Activities Three months ended Three months ended September 30, Nine months ended September 30, June 30, 2023 2022 2023 2023 2022 (In millions of dollars) Net cash provided by operating activities $ 696
Slide 12: Reconciliation of PEM, HIP and Corporate EBITDA to Operating Income (Loss)
Reconciliation of PEM, HIP and Corporate EBITDA to Operating Income (Loss) Three months Three months ended September 30, ended June 30, Nine months ended September 30, 2023 2022 2023 2023 2022 (In millions of dollars) Performance and Essential Materials EBITDA $ 339 $ 561 $ 435 $ 1,389 $ 2,794 Less:
Slide 13: Reconciliation of Free Cash Flow to Net Cash Provided by Operating Activities
Reconciliation of Free Cash Flow to Net Cash Provided by Operating Activities Three months ended Three months ended September 30, Nine months ended September 30, June 30, 2023 2022 2023 2023 2022 (In millions of dollars) Net cash provided by operating activities $ 696 $ 947 $ 555 $ 1,763 $ 2,560 Add
Slide 14: Safe Harbor Language
Safe Harbor Language This presentation contains certain forward-looking statements including statements regarding creating value for our shareholders, pricing and demand for our products, industry outlook for both of our segments, our cost control and efficiency efforts, our ability to capture integ
Slide 15: Westlake
Vestlake