LyondellBasell Industries (LYB) J.P. Morgan Industrials Conference 2025 summary

Strategic progress and value creation

• Advancing a three-pillar strategy: upgrading the core, building circular/low-carbon solutions, and enhancing performance and culture.

• Portfolio actions include asset divestitures, acquisitions, and strategic reviews to increase resiliency and returns.

• Targeting $2B incremental normalized EBITDA by 2025 and $3B by 2027; nearly two-thirds of the 2025 goal achieved by end of 2024.

• PO/TBA plant startup in 2023 adds $450M to normalized EBITDA; Value Enhancement Program exceeded $800M run-rate in 2024.

• Divested non-core ethylene oxide/derivatives, reinvesting proceeds into a 35% stake in NATPET, a cost-advantaged polypropylene JV.

Growth initiatives and capital discipline

• Joint project with Sipchem in Saudi Arabia targets a 1.5MM mt/year ethylene cracker and downstream derivatives, with expected startup in 2031 and a 40% stake.

• Final investment decision made for a second flex unit in North America, converting ethylene to propylene, reducing net long/short positions by half.

• Propylene expansion in Texas to add 400kta capacity by 2028, leveraging U.S. ethane advantage.

• Flex 2 project to start construction in 2024, operational by 2028, with capital outlay under $1B.

• Saudi project likely to be two-thirds financed with non-recourse debt, minimizing equity requirements.

Financial performance and capital allocation

• Generated $3.8B in operating cash flow in 2023; cash on hand stable at $3.4B.

• Achieved 90% cash conversion in 2024, above the 80% target; net debt-to-EBITDA at 1.8x at end of 2024.

• Returned $1.9B to shareholders through dividends and share repurchases in 2024.

• Committed to returning 70% of free cash flow to shareholders and maintaining a progressive dividend policy.

• CapEx reduced from $2.2B to $1.9B in 2024, prioritizing high-return projects and disciplined working capital management.