LyondellBasell Industries (LYB) Q2 2024 earnings summary

Executive summary

• Q2 2024 net income was $924 million ($2.82 per diluted share), with adjusted net income of $734 million ($2.24 per share), reflecting sequential improvement from higher production and seasonal demand, especially in O&P Americas and I&D segments.

• EBITDA reached $1.6 billion, or $1.4 billion excluding identified items, and cash from operating activities was $1.3 billion.

• Advanced strategic initiatives included the divestment of the EO&D business for $700 million, acquisition of a 35% stake in the NATPET JV for $500 million, and a strategic review of European assets.

• Returned $513 million to shareholders in Q2 via dividends and share repurchases, with a 7% dividend increase to $1.34 per share.

• Maintained industry-leading safety performance and continued progress toward 2027 normalized profitability and Value Enhancement Program targets.

Financial highlights

• Q2 2024 sales and operating revenues were $10.56 billion, up 6% sequentially; net income was $924 million, and EPS was $2.82.

• Adjusted EBITDA was $1.4 billion, with a 95% EBITDA-to-cash conversion rate over the last 12 months.

• Cash and cash equivalents at June 30, 2024, were $2.9 billion, with $7.0 billion in available liquidity.

• Capital expenditures were $484 million in Q2; $967 million in H1 2024.

• $1.8 billion was returned to shareholders in the last 12 months, representing 70% of $2.6 billion free cash flow.

Outlook and guidance

• Expecting slightly higher results in 2H24 versus 1H24 as global markets recover, with Q3 margins to benefit from low North American and Middle East feedstock costs.

• Value Enhancement Program is on track to contribute $400 million to 2024 EBITDA.

• Q3 average operating rates targeted: 85% for North American O&P, 80% for European O&P, and 75% for I&D.

• Oxyfuels margins anticipated to remain above historical levels during the summer driving season.

• Minimal new polyolefin capacity additions expected in North America; demand growth aligns with long-term trends.