LyondellBasell Industries NV · NYSE:LYB
LyondellBasell Industries NV — Q3 2019 Earnings Presentation
20 slides from LyondellBasell Industries NV's earnings presentation, Nov 1, 2019
Slide 1: Third Quarter 2019 Earnings
THIRD QUARTER 2019 EARNINGS November 1, 2019 1
Slide 2: Cautionary Statement and Information Related to Financial Measures
CAUTIONARY STATEMENT AND INFORMATION RELATED TO FINANCIAL MEASURES CAUTIONARY STATEMENT The statements in this presentation relating to matters that are not historical facts are forward-looking statements. These forward-looking statements are based upon assumptions of management which are believed t
Slide 3: Third Quarter 2019 Highlights
THIRD QUARTER 2019 HIGHLIGHTS LEADING CASH FLOW GENERATION FROM OPERATING ACTIVITIES $1.0 B $1.5 B $2.85 $1.9 B NET INCOME EBITDA DILUTED EPS CASH FROM USD/share OPERATING ACTIVITIES 3
Slide 4: Delivering, Growing, Advancing
DELIVERING, GROWING, ADVANCING APPLYING OUR STRONG CASH FLOW TO OUR DISCIPLINED, VALUE-DRIVEN GROWTH STRATEGY GROWING ADVANCING THROUGH INVESTMENT VALUE-DRIVEN OPPORTUNITIES STRONG Commissioning Propylene supply contract CASH FROM Hyperzone PE – 2H19 with Enterprise OPERATING ACTIVITIES MoU with Bor
Slide 5: Safety Leadership
SAFETY LEADERSHIP CONSISTENT FOCUS ON SAFETY Injuries per 200,000 hours worked 0.5 0.4 0.3 0.2 0.1 2015 2016 2017 2018 3Q19 YTD LyondellBasell ACC Top Quartile 5 Source: American Chemistry Council (ACC), LyondellBasell. 2019 ACC data not yet available. Number of hours worked includes employees and c
Slide 6: Advancing Sustainability
ADVANCING SUSTAINABILITY SERVING CUSTOMER NEEDS AND ADDRESSING SOCIETAL DEMANDS SUSTAINABLE AND CIRCULAR PRODUCTS Advancing sustainable technologies to create profitable business opportunities PLASTIC WASTE IN THE ENVIRONMENT Developing and deploying meaningful solutions through our leadership in th
Slide 7: Steady Earnings Improvement
STEADY EARNINGS IMPROVEMENT THREE CONSECUTIVE QUARTERS OF EPS GROWTH Earnings per share USD/share $4 RESILIENT PROFITABILITY 3 Strong seasonal demand 2 INCREASING VALUE PER SHARE 1 Significant share repurchases in 3Q19 3Q18 4Q18 1Q19 2Q19 3Q19 Tax Benefits 7 Note: 3Q19 results include a one time, no
Slide 8: Strong Cash Conversion
STRONG CASH CONVERSION EFFICIENT DELIVERY OF VALUE Cash from Operating Activities USD, billions $5.0 B $7 CASH FROM OPERATING ACTIVITIES 6 3Q19 LTM 5 4 $1.1 B 3 SUSTAINING CAPEX 2 3Q19 LTM 1 2015 2016 2017 2018 3Q19 LTM 13.2% Free Operating Cash Flow Sustaining Capex FREE OPERATING CASH FLOW YIELD 3
Slide 9: Cash Generation and Deployment
CASH GENERATION AND DEPLOYMENT CASH FLOW SUPPORTING ACCRETIVE INVESTMENTS AND SHAREHOLDER RETURNS USD, billions $6 DELIVERING STRONG RESULTS Cash from operating activities $1.9 B 5 4 GROWING THROUGH INVESTMENT 3 Hyperzone PE and PO/TBA 2 $1.9 RETURNING VALUE TO SHAREHOLDERS 1 $1.1 Completed tender o
Slide 10: Balanced Maturity Profile
BALANCED MATURITY PROFILE THOUGHTFUL APPROACH THAT MINIMIZES FINANCIAL RISK Long-Term Debt STRATEGICALLY MANAGED DEBT MATURITIES USD, billions Refinanced over $2 B in debt at favorable rates $ 1.5 DISCIPLINED INTEREST RATE RISK MANAGEMENT 1.0 Reduced long term weighted average interest rate by more
Slide 11: Disciplined Capital Allocation
DISCIPLINED CAPITAL ALLOCATION CLEAR FRAMEWORK THAT SUPPORTS VALUE CREATION AND SHAREHOLDER REMUNERATION 1 DIVIDEND Committed to a strong and progressive dividend DIVIDEND $1.4 – 1.5 B 2 SUSTAINING & GROWTH CAPEX Capital investments to sustain and expand our assets INORGANIC INVESTMENTS 2020-2022 SU
Slide 12: Resilient Portfolio
RESILIENT PORTFOLIO DIVERSE GLOBAL BUSINESS PORTFOLIO PROVIDES RESILIENCE EBITDA USD, billions $ 2.0 DURABLE Polyethylene chain margin 1.5 IMPROVING 1.0 Refining margins 0.5 COMPRESSED Intermediate Chemicals margins 3Q18 4Q18 1Q19 2Q19 3Q19 12
Slide 13: Olefins & Polyolefins – Americas
OLEFINS & POLYOLEFINS – AMERICAS AFFORDABLE NATURAL GAS LIQUIDS AND STRONG GLOBAL DEMAND EXPAND PROFITABILITY EBITDA USD, millions $704 $635 $653 $631 OLEFINS $516 Completed planned maintenance in 3Q Margin improved due to high feedstock flexibility POLYETHYLENE Volume increased with higher exports
Slide 14: Balanced Polyethylene Market
BALANCED POLYETHYLENE MARKET LOWER PRICE VOLATILITY YTD 3Q19 VERSUS PRIOR YEARS North America Industry Quarterly Polyethylene Price Change USD/ton OFFSETTING PRICE IMPACTS $200 2019 YTD net contract price change = $0 per ton 150 100 NEW CAPACITY WELL-ABSORBED BY GLOBAL MARKET 50 80% of 2015-2019 U.S
Slide 15: Olefins & Polyolefins – Europe, Asia & International
OLEFINS & POLYOLEFINS – EUROPE, ASIA & INTERNATIONAL DURABLE CONSUMER DEMAND SUPPORTS PROFITABILITY EBITDA USD, millions $331 $296 OLEFINS $291 $262 Small decline in volume POLYETHYLENE $127 Volume increased 10% Spread decreased ~$40/ton 3Q18 4Q18 1Q19 2Q19 Volume Margin Other 3Q19 15
Slide 16: Intermediates & Derivatives
INTERMEDIATES & DERIVATIVES INTERMEDIATE CHEMICALS MARGINS PRESSURED BY WELL SUPPLIED MARKET EBITDA USD, millions $504 $448 INTERMEDIATE CHEMICALS $379 $390 $390 Margins declined in all businesses, mainly styrene Acetyls planned maintenance 3Q-4Q OXYFUELS & RELATED PRODUCTS Margin improved with low-
Slide 17: Advanced Polymer Solutions
ADVANCED POLYMER SOLUTIONS CONTINUED HEADWINDS FROM AUTOMOTIVE AND MODEST IMPROVEMENT IN CONSTRUCTION DEMAND EBITDA COMPOUNDING & SOLUTIONS USD, millions Continued automotive headwinds $148 $120 ADVANCED POLYMERS $102 Modest improvement in construction demand $86 $70 SYNERGY CAPTURE $125 MM annualiz
Slide 18: Refining
REFINING STRONG OPERATIONS AND LOWER CRUDE OIL PRICING EXPAND PROFITABILITY EBITDA USD, millions $84 CRUDE THROUGHPUT 264 MBPD – 99% of Capacity $(6) IMPROVED MARGIN $(15) Lower prices for heavy sour crude oil on U.S. Gulf Coast open market $(66) $(84) 3Q18 4Q18 1Q19 2Q19 Volume Margin Other 3Q19 18
Slide 19: Technology
TECHNOLOGY CONTINUED STRONG PERFORMANCE IN OUR CATALYST AND LICENSING BUSINESSES EBITDA USD, millions $107 $98 LICENSING $83 $83 Fewer revenue milestones reached vs. strong 2Q19 $61 CATALYST Stable volumes and margins 3Q18 4Q18 1Q19 2Q19 3Q19 19
Slide 20: Third Quarter 2019 Summary & Outlook
THIRD QUARTER 2019 SUMMARY & OUTLOOK DELIVERING RESILIENT RESULTS AND DISCIPLINED CAPITAL ALLOCATION RESILIENT TANGIBLE ADVANCING RESULTS EARNINGS OPPORTUNITIES Strong cash from Expect typical seasonality in Disciplined approach to operating activities and Q4 and tangible earnings investment through
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