Westlake Chemical Partners Lp · NYSE:WLKP
Westlake Chemical Partners Lp — Investor Presentation (2020)
18 slides from Westlake Chemical Partners Lp's investor presentation, 2020
Slide 1: Westlake Chemical Partners LP 4th Quarter 2019
Westlake Chemical Partners LP 4th Quarter 2019
Slide 2: Westlake Chemical Partners LP
Westlake Chemical Partners LP • Predictable and stable cash flows insulated from commodity price risk • Consistent top tier distribution growth every quarter since 2014 IPO • Long history of reliable operations from strategically located assets Stable and predictable cash flows Long history of predi
Slide 3: Predictable and Stable Cash Flows with Conservative Financial Structure
Westlake Chemical Partners LP & Westlake Chemical Corporation Predictable and Stable Cash Flows with Conservative Financial Structure Investors Investors 59.9% ownership Westlake Chemical 40.1% ownership Westlake Partners LP Chemical Corp (WLKP) (WLK) 22.8% ownership 77.2% ownership Westlake Chemica
Slide 4: Westlake Partners Assets Provide Vital Ethylene to Westlake Chemical
Westlake Partners Assets Provide Vital Ethylene to Westlake Chemical Lake Charles, Calvert City, Kentucky Longview, Texas Louisiana Complex Complex Complex • Two ethane-based processing • One ethane-based processing • A 200-mile common carrier ethylene facilities at Westlake’s Lake facility located
Slide 5: Westlake Chemical's Short Position in Ethylene Provides Demand for Westlake Partners
Westlake Chemical’s Short Position in Ethylene Provides Demand for Westlake Partners Westlake Partners’ current production capacity plus the potential 1.1B lbs in the JV cracker would still leave Westlake Chemical short an additional 1.1B lbs of Ethylene Westlake Westlake Chemical Partners Polyethyl
Slide 6: Westlake Partners Value Chain: Ethylene Sales Agreement
Westlake Partners Value Chain: Ethylene Sales Agreement Pricing Formula Promotes Stable & Predictable Cash Flows • Westlake Partners is the critical supplier of the Ethylene Westlake Chemical needs to produce it’s products • Ethylene Sales Agreement between Westlake Chemical and Westlake Partners pr
Slide 7: Sales Agreement has Insulated WLKP From Commodity Risk and Enhanced Cash Flow Stability
Sales Agreement has Insulated WLKP From Commodity Risk and Enhanced Cash Flow Stability Integrated Margin (cents / lb) 50 Industry Integrated Margins – Ethylene and Polyethylene 40 30 20 OpCo 10 Margin 0 -10 2013 2007 2008 2009 2010 2011 2012 2014 2015 2016 2017 2018 2019 Ethylene Margin PE Non-Inte
Slide 8: Strong Distribution Growth From Conservative Financial Structure
Strong Distribution Growth From Conservative Financial Structure Annual Distributable Cash Flows and Production since IPO Higher, steady production rates 4,000 $80 Distributable Cash Flow ($MM) Ethylene Production (MM lbs) lead to dependable, 3,000 $60 Capacity stable financials expansion 2,000 outa
Slide 9: Partners in the Top Tier of MLPs for Distribution Growth
Westlake Partners in the Top Tier of MLPs for Distribution Growth WLKP remains committed to offering unitholders top tier distribution growth. Distribution Publically Traded MLP Population Growth Estimated 2019 andEstimate and Growth 2020 Distribution Yield Rates as of Oct 30, 2019 40.0% 30.0% WLKP
Slide 10: Four Levers of Growth for Stable, Growing Cash Flows
Four Levers of Growth for Stable, Growing Cash Flows Increase our ownership interest in OpCo over time either by purchasing new OpCo interests or by purchasing outstanding interests in OpCo from WLK • Purchased 2.7% of OpCo for $135 Million in May 2015 • Purchased 5% of additional OpCo interests for
Slide 11: Ample Capacity to Fund Earnings Growth
Ample Capacity to Fund Earnings Growth • Recent drop down in 1Q 2019 continues growth of cash flows to unitholders with large capacity left to fund future growth • In July 2018, Westlake Chemical re-set Westlake Partners IDR schedule relieving Westlake Partners of the IDR cash flow burden and signif
Slide 12: Completed Capacity Expansions + IDR Resets + Acquisition of JV Opportunity Means Extended Growth
Completed Capacity Expansions + IDR Resets + Acquisition of JV Opportunity Means Extended Growth for Westlake Partners Net Income Attributable to WLKP unitholders ($MM) $80 LACC JV IDR reset OpCo drop Calvert City down Cracker provides Expansion eligible to longer $60 and OpCo growth path add to dro
Slide 13: Solid Leverage Metrics
Solid Leverage Metrics Well Capitalized for Financial Stability WLKP is well capitalized and has significant financial flexibility to fund future growth with its strong and supportive parent; Westlake Chemical (WLK) Westlake Partners Liquidity Liquidity (in millions) Dec 30, 2019 Cash and Equivalent
Slide 14: Key Investment Drivers
Key Investment Drivers Westlake Stable and Strategic Experienced & Chemical’s Predictable Relationship Strategically Incentivized Increasing Cash Flows with Westlake Located Assets Management Demand for Unencumbered Chemical Team Ethylene with IDR’s Global Cost Expanded Ethylene Competitive Access t
Slide 15: Appendix
Enhancing Your Life Every Day Westlake Chemical W
Slide 16: WLKP Growth Strategy
WLKP Growth Strategy Acquisition and Expansion Provides Growth Maintain financial flexibility to protect and grow distributions Expand production capacity of ethylene through cost effective debottlenecks • Approximately 250 Million pounds completed in Lake Charles in 2016 • Approximately 100 Mil
Slide 17: Reset IDR Tiers for Westlake Chemical Partners
Reset IDR Tiers for Westlake Chemical Partners Initial Newly reset distribution structure distribution structure % % Quarterly Annualized Quarterly Annualized distribution distribution distribution distribution distribution distribution IDR Tiers to IDRs to IDRs First target distribution up to: $ 0.
Slide 18: Disclaimer
Disclaimer This presentation contains certain forward-looking statements, including statements with respect to future growth, potential levers for cash flow, growth, remaining drop down capacity and the Lotte JV as a source of future drop down capacity for Westlake Chemical Partners and the timing a
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