Quantcast

LyondellBasell Reports Second-Quarter 2014 Results

July 25, 2014

HOUSTON and LONDON, July 25, 2014 /PRNewswire/ –

Second-Quarter 2014 Highlights

    --  Record quarterly EBITDA of $1.94 billion
    --  Record diluted earnings per share of $2.22; income from continuing
        operations of $1.17 billion
    --  Solid results in all segments, with O&P Americas segment approaching
        EBITDA of $1 billion
    --  Completed initial 10% share repurchase and initiated purchases under
        second 10% authorization;  repurchased approximately 19 million shares
        during the quarter

LyondellBasell Industries (NYSE: LYB) today announced earnings from continuing operations for the second quarter 2014 of $2.22 diluted earnings per share, or $1.17 billion. Second quarter 2014 EBITDA was $1.94 billion. The increase from the first quarter 2014 was primarily due to Olefins and Polyolefins – Americas segment results.

Comparisons with the prior quarter and second quarter 2013 are shown below:


    Table 1 - Earnings Summary
    --------------------------

                                                                                                                                                       Three Months Ended             Six Months Ended
                                                                                                                                                       ------------------

                                                                                           June 30,                                            March 31,      June 30,    June 30,
                                                                                                                                                              --------

    Millions of U.S. dollars (except share data)                                                                                                   2014           2014         2013        2014         2013
                                                                                                                                                   ----           ----         ----        ----         ----

    Sales and other operating revenues                                                                                                          $12,117        $11,135      $11,103     $23,252      $21,772
    ----------------------------------                                                                                                          -------        -------      -------     -------      -------

    Net income(a)                                                                                                                                 1,176            944          927       2,120        1,827
    ------------                                                                                                                                  -----            ---          ---       -----        -----

    Income from continuing operations(b)                                                                                                          1,173            943          923       2,116        1,829
    -----------------------------------                                                                                                           -----            ---          ---       -----        -----

    Diluted earnings per share (U.S. dollars):
    ------------------------------------------

                                                  Net income(c)                                                                                      2.23           1.72         1.61        3.94         3.16
                                                  ------------                                                                                       ----           ----         ----        ----         ----

                                                  Income from continuing operations(b)                                                               2.22           1.72         1.60        3.93         3.16
                                                  -----------------------------------                                                                ----           ----         ----        ----         ----

    Diluted share count (millions)                                                                                                                  527            548          578         537          578
    -----------------------------                                                                                                                   ---            ---          ---         ---          ---

    EBITDA(d)                                                                                                                                     1,941          1,668        1,652       3,609        3,237
    --------                                                                                                                                      -----          -----        -----       -----        -----

    (a)  Includes net loss attributable to non-controlling interests and income (loss) from discontinued operations, net of tax. See Table 10.

    (b)  Please see Table 11 for charges and benefits to income from continuing operations.

    (c)  Includes diluted earnings per share attributable to discontinued operations.

    (d)  See the end of this release for an explanation of the Company's use of EBITDA and Table 8 for reconciliations of EBITDA to income

    from continuing operations.

“We had record earnings this quarter of $2.22 per share, while our EBITDA approached $2 billion. Importantly, every segment contributed to this achievement. Of particular note was the strength in our Olefins and Polyolefins- Americas segment which generated nearly $1 billion of EBITDA even while we were performing significant scheduled maintenance at our La Porte ethylene site. In addition to the strong quarterly earnings, we repurchased approximately 19 million of our shares during the second quarter, completing the initial 10 percent share repurchase authorization. We also initiated repurchases under the second 10 percent authorization,” said Jim Gallogly, LyondellBasell Chief Executive Officer.

“As encouraging as these results are, we did not fully deliver on our reliability expectations, and the quarterly earnings could have been better. Specifically, we were late in completing our La Porte ethylene turnaround in part due to a mechanical issue with a compressor. Both supplier upsets and mechanical issues impacted our Intermediates and Derivatives business as well. Despite these temporary setbacks, our commitment to Operational Excellence continues to be the foundation of our success,” Gallogly said.

“Industry fundamentals remain strong, and we continue to execute on our investment program. During the third quarter we expect to begin production from the 800 million pound per year La Porte ethylene expansion. This is the first of three ethylene expansions and continues to put us well ahead of new greenfield plants pursued by others in the industry,” Gallogly added.

OUTLOOK

“During the first weeks of the third quarter, industry conditions have been similar to the second quarter environment. U.S. oil, natural gas, and natural gas liquids production remain strong. Together these support margins in our Olefins and Polyolefins – Americas, Intermediates and Derivatives, and Refining segments. However, our results in the next quarter will be negatively impacted by the delayed start-up of our La Porte ethylene plant,” Gallogly noted.

LYONDELLBASELL BUSINESS RESULTS DISCUSSION BY REPORTING SEGMENT

LyondellBasell manages operations through five operating segments: 1) Olefins and Polyolefins – Americas; 2) Olefins and Polyolefins – Europe, Asia and International (EAI); 3) Intermediates and Derivatives; 4) Refining; and 5) Technology.

Olefins and Polyolefins – Americas (O&P-Americas) – The primary products of this segment include ethylene and its co-products (propylene, butadiene and benzene), polyethylene, polypropylene and Catalloy process resins.


    Table 2 - O&P-Americas Financial Overview
    -----------------------------------------

                                              Three Months Ended    Six Months Ended
                                              ------------------

                                                   June 30,             March 31,         June 30,      June 30,
                                                                                                        --------

    Millions of U.S. dollars                                   2014                  2014          2013            2014   2013
    ------------------------                                   ----                  ----          ----            ----   ----

    Operating income                                           $898                  $656          $872          $1,554 $1,693
    ----------------                                           ----                  ----          ----          ------ ------

    EBITDA                                                      978                   736           951           1,714  1,849
    ------                                                      ---                   ---           ---           -----  -----

Three months ended June 30, 2014 versus three months ended March 31, 2014 - The segment achieved record EBITDA results in the second quarter of 2014. EBITDA increased $242 million versus the first quarter 2014. Compared to the prior period, olefins results increased approximately $220 million. The first quarter was negatively impacted by ethylene purchases and inventory build in preparation for the second quarter La Porte plant turnaround. The second quarter was also negatively impacted, but to a lesser extent, by the delayed restart of the La Porte olefin plant and the subsequent purchase of ethylene. This impacted results by approximately $50 million. Olefins benefited in the second quarter from lower NGL costs and improved co-product values. Combined polyolefin results increased by approximately $20 million from the first quarter 2014 driven by higher polyethylene margins. The ethylene to polyethylene price spread increased 2 cents per pound. Joint venture equity income increased by $2 million.

Three months ended June 30, 2014 versus three months ended June 30, 2013 - EBITDA increased $27 million versus the second quarter 2013. Olefins results declined approximately $130 million compared to the prior year period. Olefins sales and production volumes declined. However, margins benefited from lower NGL costs and higher co-product values. The price of ethylene decreased by approximately 2 cents per pound compared to the prior year period. Polyethylene results increased by approximately $150 million as the ethylene to polyethylene price spread improved by 10 cents per pound and sales volumes increased approximately 4 percent versus the prior year period. Polypropylene results increased by approximately $15 million due to slightly higher margins. Joint venture equity income decreased by $2 million.

Olefins and Polyolefins – Europe, Asia, International (O&P-EAI) – The primary products of this segment include ethylene and its co-products (propylene and butadiene), polyethylene, polypropylene, global polypropylene compounds, Catalloy process resins and polybutene-1 resins.


    Table 3 - O&P-EAI Financial Overview
    ------------------------------------

                                                  Three Months Ended                 Six Months
                                                                                       Ended
                                                           ------------------

                                         June 30,     March 31,     June 30,    June 30,
                                                                                --------

    Millions of U.S. dollars                  2014           2014          2013        2014     2013
    ------------------------                  ----           ----          ----        ----     ----

    Operating income                          $190           $225          $189        $415     $282
    ----------------                          ----           ----          ----        ----     ----

    EBITDA                                     319            356           295         675      520
    ------                                     ---            ---           ---         ---      ---

Three months ended June 30, 2014 versus three months ended March 31, 2014 - EBITDA decreased $37 million versus the first quarter 2014. Excluding the benefits of a $52 million environmental settlement in the first quarter, EBITDA increased by $15 million. Olefins results increased modestly. Naphtha cost increases and a decline in the price of ethylene of approximately 2 cents per pound were more than offset by increased co-product prices and from cracking more advantaged feedstocks. Approximately 55 percent of our ethylene production was sourced from advantaged raw materials. Combined polyolefin results increased from higher volumes. Combined polypropylene compounds and polybutene-1 results were unchanged. Equity income from joint ventures increased by $9 million from the first quarter 2014.

Three months ended June 30, 2014 versus three months ended June 30, 2013 - EBITDA increased $24 million versus the second quarter 2013. Olefins results declined by approximately $20 million as a result of margins that were lower by approximately 3 cents per pound. This was partially mitigated by higher operating rates and from higher butadiene volumes following a 2013 expansion project. Combined polyolefin results increased primarily as a result of higher polyethylene and polypropylene margins of approximately 1 cent per pound. Polypropylene compounds and polybutene-1 results decreased by approximately $10 million from the prior year period as a result of lower polypropylene compound margins. Equity income from joint ventures increased $32 million from the second quarter 2013.

Intermediates and Derivatives (I&D) – The primary products of this segment include propylene oxide (PO) and its co-products (styrene monomer, tertiary butyl alcohol (TBA), isobutylene and tertiary butyl hydroperoxide), and derivatives (propylene glycol, propylene glycol ethers and butanediol), acetyls (acetic acid, vinyl acetate monomer and methanol), ethylene oxide and its derivatives, and oxyfuels.


    Table 4 -I&D Financial
     Overview
    ----------------------

                             Three Months Ended    Six Months
                                                     Ended
                                ------------------

                                  June 30,         March 31,       June 30,      June 30,
                                                                                 --------

    Millions of U.S. dollars                  2014            2014          2013          2014 2013
    ------------------------                  ----            ----          ----          ---- ----

    Operating income                          $375            $316          $285          $691 $608
    ----------------                          ----            ----          ----          ---- ----

    EBITDA                                     430             375           338           805  711
    ------                                     ---             ---           ---           ---  ---

Three months ended June 30, 2014 versus three months ended March 31, 2014 - EBITDA increased $55 million versus the first quarter 2014. Results for PO and PO derivatives decreased by approximately $20 million. Seasonally lower sales of propylene glycol sold into aircraft deicing were offset by higher sales of propylene oxide. Solvent margins declined. Intermediate chemicals results increased by approximately $10 million as styrene and ethylene glycol volumes improved. Additionally, acetic acid, vinyl acetate, and styrene margins improved but lower margins from methanol and ethylene glycol pricing partially offset the benefit. Oxyfuels results improved by approximately $70 million due to seasonal increases in both volume and margin. Equity income from joint ventures decreased by $4 million.

Three months ended June 30, 2014 versus three months ended June 30, 2013 - EBITDA increased $92 million compared to the second quarter 2013. Results for PO and PO derivatives increased by approximately $25 million primarily due to higher volumes. Intermediate chemicals results were higher by approximately $60 million due to higher methanol and styrene volumes, and higher methanol and vinyl acetate margins. Oxyfuels results increased by approximately $10 million. Equity income from joint ventures decreased by $5 million from the second quarter in 2013.

Refining - The primary products of this segment include gasoline, diesel fuel, heating oil, jet fuel, and petrochemical raw materials.


    Table 5 - Refining Financial Overview
    -------------------------------------

                                                   Three Months Ended              Six Months Ended
                                                   ------------------

                                          June 30,     March 31,     June 30,    June 30,
                                                                                 --------

    Millions of U.S. dollars                   2014           2014          2013        2014        2013
    ------------------------                   ----           ----          ----        ----        ----

    Operating income (loss)                     $95            $86         ($16)       $181       ($33)
    ----------------------                      ---            ---          ----        ----        ----

    EBITDA                                      137            129            20         266          40
    ------                                      ---            ---           ---         ---         ---

Three months ended June 30, 2014 versus three months ended March 31, 2014 - EBITDA increased $8 million versus the first quarter 2014. The refinery processed 257,000 barrels per day, up 10,000 barrels per day from the prior quarter. Compared to the prior quarter, the Maya 2-1-1 benchmark crack spread declined by $1.25 per barrel, averaging $27.01 per barrel. The corresponding Houston refinery spread was relatively unchanged. The cost of Renewable Identification Numbers (RINs) to meet U.S. renewable fuel standards was relatively unchanged versus the first quarter 2014.

Three months ended June 30, 2014 versus three months ended June 30, 2013 - EBITDA increased $117 million versus the second quarter 2013. The refinery processed 257,000 barrels per day, down 8,000 barrels per day from the prior year period. Compared to the second quarter 2013, the Maya 2-1-1 benchmark spread increased $5.43 per barrel, and we benefited from improved yields and higher margins on secondary products. The cost of RINs decreased by approximately $20 million compared to the same quarter last year.

Technology – The principal products of the Technology segment include polyolefin catalysts and production process technology licenses and related services.


    Table 6 - Technology Financial Overview
    ---------------------------------------

                                            Three Months Ended    Six Months
                                                                    Ended
                                               ------------------

                                                 June 30,         March 31,       June 30,      June 30,
                                                                                                --------

    Millions of U.S. dollars                                 2014            2014          2013          2014 2013
    ------------------------                                 ----            ----          ----          ---- ----

    Operating income                                          $56             $60           $39          $116  $89
    ----------------                                          ---             ---           ---          ----  ---

    EBITDA                                                     71              76            59           147  125
    ------                                                    ---             ---           ---           ---  ---

Three months ended June 30, 2014 versus three months ended March 31, 2014 - EBITDA decreased by $5 million.

Three months ended June 30, 2014 versus three months ended June 30, 2013 - EBITDA increased by $12 million from higher catalyst and licensing results.

Capital spending and cash balances

Capital expenditures, including growth projects, maintenance turnarounds, catalyst and information technology-related expenditures, were $415 million in the second quarter 2014. Our cash and short-term securities balance was $3.5 billion at June 30, 2014. We repurchased approximately 19 million of our outstanding ordinary shares and paid $370 million in dividends during the second quarter of 2014. There were 515 million common shares outstanding as of June 30(th).

CONFERENCE CALL

LyondellBasell will host a conference call July 25 at 11 a.m. ET. Participants on the call will include Chief Executive Officer Jim Gallogly, Executive Vice President and Chief Financial Officer Karyn Ovelmen, Senior Vice President – Strategic Planning and Transactions Sergey Vasnetsov, and Vice President of Investor Relations Doug Pike.

The toll-free dial-in number in the U.S. is 888-677-1826. For international numbers, go to www.lyondellbasell.com/teleconference, for a complete listing of toll-free numbers by country. The pass code for all numbers is 1231245.

A replay of the call will be available from 2 p.m. ET July 25 until Aug. 25 at 11 p.m. ET. The replay dial-in numbers are 800-839-1171 (U.S.) and +1 203-369-3030 (international). The pass code for each is 3675.

The slides that accompany the call will be available at http://www.lyondellbasell.com/earnings.

ABOUT LYONDELLBASELL

LyondellBasell (NYSE: LYB) is one of the world’s largest plastics, chemical and refining companies and a member of the S&P 500. LyondellBasell (www.lyondellbasell.com) manufactures products at 55 sites in 18 countries. LyondellBasell products and technologies are used to make items that improve the quality of life for people around the world including packaging, electronics, automotive parts, home furnishings, construction materials and biofuels.

FORWARD-LOOKING STATEMENTS

The statements in this release and the related teleconference 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 to be reasonable at the time made and are subject to significant risks and uncertainties. Actual results could differ materially based on factors including, but not limited to, the business cyclicality of the chemical, polymers and refining industries; the availability, cost and price volatility of raw materials and utilities, particularly the cost of oil, natural gas, and associated natural gas liquids; competitive product and pricing pressures; labor conditions; our ability to attract and retain key personnel; operating interruptions (including leaks, explosions, fires, weather-related incidents, mechanical failure, unscheduled downtime, supplier disruptions, labor shortages, strikes, work stoppages or other labor difficulties, transportation interruptions, spills and releases and other environmental risks); the supply/demand balances for our and our joint ventures’ products, and the related effects of industry production capacities and operating rates; our ability to achieve expected cost savings and other synergies; our ability to successfully execute projects and growth strategies; legal and environmental proceedings; tax rulings, consequences or proceedings; technological developments, and our ability to develop new products and process technologies; potential governmental regulatory actions; political unrest and terrorist acts; risks and uncertainties posed by international operations, including foreign currency fluctuations; and our ability to comply with debt covenants and service our debt. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the “Risk Factors” section of our Form 10-K for the year ended December 31, 2013, which can be found at www.lyondellbasell.com on the Investor Relations page and on the Securities and Exchange Commission’s website at www.sec.gov.

NON-GAAP MEASURES

This release makes reference to certain “non-GAAP” financial measures, such as EBITDA, as defined in Regulation G of the U.S. Securities Exchange Act of 1934, as amended. We report our financial results in accordance with U.S. generally accepted accounting principles, but believe that certain non-GAAP financial measures, such as EBITDA, provide useful supplemental information to investors regarding the underlying business trends and performance of the company’s ongoing operations and are useful for period-over-period comparisons of such operations. These non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the financial measures prepared in accordance with GAAP.

EBITDA, as presented herein, may not be comparable to a similarly titled measure reported by other companies due to differences in the way the measure is calculated. We calculate EBITDA as income from continuing operations plus interest expense (net), provision for (benefit from) income taxes, and depreciation & amortization. EBITDA should not be considered an alternative to profit or operating profit for any period as an indicator of our performance, or as alternative to operating cash flows as a measure of our liquidity.

Quantitative reconciliations of EBITDA to net income, the most comparable GAAP measure, are provided in Table 8 at the end of this release.

OTHER FINANCIAL MEASURE PRESENTATION NOTES

This release contains time sensitive information that is accurate only as of the time hereof. Information contained in this release is unaudited and subject to change. LyondellBasell undertakes no obligation to update the information presented herein except to the extent required by law.




    Table 7 - Reconciliation of Segment Information to Consolidated Financial Information
    -------------------------------------------------------------------------------------

                                                                                                                 2013                     2014
                                                                                                                 ----                     ----

                           (Millions of U.S.
                           dollars)                   Q1                              Q2       Q3             Q4                Total           Q1                Q2              YTD
                          ------------------          ---                             ---     ---             ---               -----          ---                ---             ---

                           Sales and other
                           operating
                           revenues:

                           Olefins &
                           Polyolefins -
                           Americas                                      $3,244                $3,251                    $3,315                   $3,279                  $13,089                  $3,357                   $3,462                     $6,819

                           Olefins &
                           Polyolefins -
                           Europe, Asia,
                           International                                  3,800                 3,708                     3,594                    3,583                   14,685                   3,778                    4,069                      7,847

                           Intermediates &
                           Derivatives                                    2,282                 2,217                     2,452                    2,521                    9,472                   2,429                    2,706                      5,135

                          Refining                                        2,468                 3,077                     3,177                    2,976                   11,698                   2,756                    3,250                      6,006

                          Technology                                        134                   132                       124                      142                      532                     136                      144                        280

                          Other                                         (1,259)              (1,282)                  (1,510)                 (1,363)                 (5,414)                (1,321)                 (1,514)                   (2,835)
                                                                         ------                ------                    ------                   ------                   ------                  ------                   ------                     ------

                                                 Continuing
                                                 Operations                          $10,669          $11,103                     $11,152                 $11,138                    $44,062                 $11,135                   $12,117                     $23,252
                                                                                     =======          =======                     =======                 =======                    =======                 =======                   =======                     =======

                           Operating income
                           (loss):

                           Olefins &
                           Polyolefins -
                           Americas                                        $821                  $872                      $759                     $801                   $3,253                    $656                     $898                     $1,554

                           Olefins &
                           Polyolefins -
                           Europe, Asia,
                           International                                     93                   189                        78                       17                      377                     225                      190                        415

                           Intermediates &
                           Derivatives                                      323                   285                       371                      321                    1,300                     316                      375                        691

                          Refining                                         (17)                 (16)                     (37)                      92                       22                      86                       95                        181

                          Technology                                         50                    39                        35                       33                      157                      60                       56                        116

                          Other                                             (3)                  (5)                        1                             - -                       (7)                    (3)                      (1)                        (4)
                                                                            ---                   ---                       ---                             ---                       ---                     ---                       ---                         ---

                                                 Continuing
                                                 Operations                           $1,267           $1,364                      $1,207                  $1,264                     $5,102                  $1,340                    $1,613                      $2,953
                                                                                      ======           ======                      ======                  ======                     ======                  ======                    ======                      ======

                           Depreciation and
                           amortization:

                           Olefins &
                           Polyolefins -
                           Americas                                         $75                   $69                       $73                      $76                     $293                     $73                      $74                       $147

                           Olefins &
                           Polyolefins -
                           Europe, Asia,
                           International                                     77                    76                        78                       56                      287                      70                       67                        137

                           Intermediates &
                           Derivatives                                       48                    50                        50                       56                      204                      55                       56                        111

                          Refining                                           36                    37                        45                       42                      160                      42                       42                         84

                          Technology                                         17                    20                        16                       22                       75                      16                       15                         31

                          Other                                             - -                    2                               - -                    - -                         2                     - -                      - -                        - -
                                                                            ---                  ---                               ---                    ---                       ---                     ---                      ---                        ---

                                                 Continuing
                                                 Operations                             $253             $254                        $262                    $252                     $1,021                    $256                      $254                        $510
                                                                                        ====             ====                        ====                    ====                     ======                    ====                      ====                        ====

                          EBITDA: (a)

                           Olefins &
                           Polyolefins -
                           Americas                                        $898                  $951                      $841                     $883                   $3,573                    $736                     $978                     $1,714

                           Olefins &
                           Polyolefins -
                           Europe, Asia,
                           International                                    225                   295                       204                      115                      839                     356                      319                        675

                           Intermediates &
                           Derivatives                                      373                   338                       427                      354                    1,492                     375                      430                        805

                          Refining                                           20                    20                         8                      134                      182                     129                      137                        266

                          Technology                                         66                    59                        52                       55                      232                      76                       71                        147

                          Other                                               3                  (11)                      (1)                       2                      (7)                    (4)                       6                          2
                                                                            ---                   ---                       ---                      ---                      ---                     ---                      ---                        ---

                                                 Continuing
                                                 Operations                           $1,585           $1,652                      $1,531                  $1,543                     $6,311                  $1,668                    $1,941                      $3,609
                                                                                      ======           ======                      ======                  ======                     ======                  ======                    ======                      ======

                           Capital,
                           turnarounds and IT
                           deferred spending:

                           Olefins &
                           Polyolefins -
                           Americas                                        $122                  $122                      $218                     $183                     $645                    $231                     $306                       $537

                           Olefins &
                           Polyolefins -
                           Europe, Asia,
                           International                                     63                    46                        44                       76                      229                      33                       27                         60

                           Intermediates &
                           Derivatives                                      106                   141                       119                       77                      443                      45                       52                         97

                          Refining                                           93                    67                        36                       13                      209                      32                       20                         52

                          Technology                                          7                     6                         7                       10                       30                       2                        6                          8

                          Other                                             - -                    5                       (1)                       1                        5                              - -                        4                           4
                                                                            ---                  ---                       ---                      ---                      ---                              ---                      ---                         ---

                                                Total                                    391              387                         423                     360                      1,561                     343                       415                         758

                           Deferred charges
                           included above                                   - -                        - -                        - -                    - -                       - -                    - -                      - -                        - -
                                                                            ---                        ---                        ---                    ---                       ---                    ---                      ---                        ---

                                                 Continuing
                                                 Operations                             $391             $387                        $423                    $360                     $1,561                    $343                      $415                        $758
                                                                                        ====             ====                        ====                    ====                     ======                    ====                      ====                        ====

    (a) See Table 8 for EBITDA calculation.



    Table 8 - EBITDA Calculation
    ----------------------------

                                                                                2013                          2014
                                                                                ----                          ----

                  (Millions of
                  U.S. dollars)        Q1             Q2     Q3             Q4              Total     Q1               Q2         YTD
                 -------------         ---            ---    ---            ---             -----     ---              ---        ---

                  Net income
                  attributable to
                  the Company
                  shareholders                   $901              $929                $853               $1,174           $3,857              $945       $1,178        $2,123

                 Net income
                  (loss)
                  attributable to
                  non-
                  controlling
                  interests                       (1)              (2)                (2)                   1              (4)              (1)         (2)          (3)

                 (Income) loss
                  from
                  discontinued
                  operations, net
                  of tax                            6               (4)                  3                    2                7               (1)         (3)          (4)
                                                  ---               ---                 ---                  ---              ---               ---          ---           ---

                  Income from
                  continuing
                  operations                      906               923                 854                1,177            3,860               943        1,173         2,116

                                  Provision
                                  for income
                                  taxes                  357            410                       339               30                1,136         383          425           808

                                  Depreciation
                                  and
                                  amortization           253            254                       262              252                1,021         256          254           510

                                  Interest
                                  expense,
                                  net                     69             65                        76               84                  294          86           89           175
                                                         ---            ---                       ---              ---                  ---         ---          ---           ---

                 EBITDA                        $1,585            $1,652              $1,531               $1,543           $6,311            $1,668       $1,941        $3,609
                                               ======            ======              ======               ======           ======            ======       ======        ======



    Table 9 - Selected Segment Operating Information
    ------------------------------------------------

                                                                                                                                   2013            2014
                                                                                                                                   ----            ----

                                                                                                        Q1                     Q2              Q3              Q4         Total        Q1         Q2         YTD
                                                                                                        ---                    ---             ---             ---        -----        ---        ---        ---

                        Olefins and
                        Polyolefins -
                        Americas

                        Volumes (million
                        pounds)
                       -----------------

                                             Ethylene
                                             produced                                  2,337                             2,412           2,111           2,156      9,016        1,979      1,721      3,700

                                             Propylene
                                             produced                                    624                               529             652             646      2,451          611        648      1,259

                                             Polyethylene
                                             sold                                      1,396                             1,389           1,378           1,409      5,572        1,406      1,451      2,857

                                             Polypropylene
                                             sold                                        565                               637             669             642      2,513          614        632      1,246

                        Benchmark Market
                        Prices
                       -----------------

                        West Texas
                                             Intermediate
                                             crude oil
                                             (USD per
                                             barrel)                                   94.43                             94.17          105.80           97.60      98.06        98.61     102.99     100.84

                        Light
                                             Louisiana
                                             Sweet ("LLS")
                                             crude oil
                                             (USD per
                                             barrel)                                  113.86                            104.64          109.94          101.12     107.31       104.36     105.55     104.97

                                             Natural gas
                                             (USD per
                                             million BTUs)                              3.45                              4.22            3.68            3.70       3.78         5.01       4.74       4.87

                        U.S. weighted
                                             average cost
                                             of ethylene
                                             production
                                             (cents/
                                             pound)                                     13.8                              15.7            16.6            18.6       16.2         20.0       17.1       18.6

                                             U.S. ethylene
                                             (cents/
                                             pound)                                     48.0                              46.3            45.8            46.5       46.7         48.3       47.2       47.8

                        U.S.
                                             polyethylene
                                             [high
                                             density]
                                             (cents/
                                             pound)                                     66.7                              68.7            71.7            75.0       70.5         76.3       77.0       76.7

                                             U.S. propylene
                                             (cents/
                                             pound)                                     75.0                              63.3            68.3            68.2       68.7         73.3       69.7       71.5

                        U.S.
                                             polypropylene
                                             [homopolymer]
                                             (cents/
                                             pound)                                     88.0                              76.2            82.3            82.2       82.2         88.3       84.7       86.5

                        Olefins and
                        Polyolefins -
                        Europe, Asia,
                        International

                        Volumes (million
                        pounds)
                       -----------------

                                             Ethylene
                                             produced                                    912                               991             984             930      3,817          989      1,024      2,013

                                             Propylene
                                             produced                                    577                               610             597             568      2,352          582        617      1,199

                                             Polyethylene
                                             sold                                      1,206                             1,314           1,212           1,167      4,899        1,275      1,363      2,638

                                             Polypropylene
                                             sold                                      1,657                             1,821           1,612           1,531      6,621        1,509      1,707      3,216

                        Benchmark Market
                        Prices (EUR0.01
                        per pound)
                       -----------------

                        Western Europe
                                             weighted
                                             average cost
                                             of ethylene
                                             production                                 36.2                              29.3            34.9            38.5       34.7         32.9       34.3       33.6

                                             Western Europe
                                             ethylene                                   58.6                              54.4            55.0            55.1       55.8         54.7       52.8       53.8

                                             Western Europe
                                             polyethylene
                                             [high
                                             density]                                   61.2                              56.8            57.9            57.1       58.2         56.1       54.8       55.5

                                             Western Europe
                                             propylene                                  50.6                              47.9            49.6            49.9       49.5         51.3       52.2       51.7

                                             Western Europe
                                             polypropylene
                                             [homopolymer]                              59.1                              56.1            58.1            58.2       57.9         59.9       61.3       60.6

                        Intermediates and
                        Derivatives

                        Volumes (million
                        pounds)
                       -----------------

                                             Propylene
                                             oxide and
                                             derivatives                                 683                               665             665             729      2,742          772        781      1,553

                                             Ethylene oxide
                                             and
                                             derivatives                                 260                               277             294             346      1,177          262        319        581

                                             Styrene
                                             monomer                                     703                               589             756             832      2,880          683        870      1,553

                                            Acetyls                                      431                               470             506             510      1,917          683        592      1,275

                                             TBA
                                             Intermediates                               434                               357             425             442      1,658          416        391        807

                        Volumes (million
                        gallons)
                       -----------------

                                            MTBE/ETBE                                    185                               235             241             222        883          188        266        454

                        Benchmark Market
                        Margins  (cents
                        per gallon)
                       -----------------

                                             MTBE -
                                             Northwest
                                             Europe                                    104.9                              88.4            86.8            37.8       79.1         63.4       90.7       76.8

                       Refining

                        Volumes
                        (thousands of
                        barrels per day)
                       -----------------

                                             Heavy crude
                                             oil
                                             processing
                                             rate                                        173                               265             250             239        232          247        257        252

                        Benchmark Market
                        Margins
                       -----------------

                                             Light crude
                                             oil -2-1-1                                11.53                             14.63           12.63           12.67      12.89        13.18      17.29      15.27

                                             Light crude
                                             oil -Maya
                                             differential                              11.17                              6.95           10.59           11.65      10.05        15.08       9.72      12.41

    Source:  LYB and third party consultants

    Note:  Benchmark market prices for U.S. and Western Europe polyethylene and polypropylene reflect discounted prices.



    Table 10 - Unaudited Income Statement Information
    -------------------------------------------------

                                                                                                                        2013                              2014
                                                                                                                        ----                              ----

                  (Millions of U.S.
                  dollars)                        Q1                                  Q2             Q3               Q4                      Total              Q1                  Q2                     YTD
                 ------------------              ---                                  ---           ---               ---                     -----             ---                  ---                    ---

                  Sales and other
                  operating revenues                                   $10,669                   $11,103                          $11,152                      $11,138                          $44,062                      $11,135                     $12,117                         $23,252

                 Cost of sales                                           9,153                     9,496                            9,690                        9,601                           37,940                        9,577                      10,255                          19,832

                  Selling, general and
                  administrative expenses                                       213                       208                             220                          229                              870                          186                         215                             401

                  Research and development
                  expenses                                                  36                        35                               35                           44                              150                           32                          34                              66
                                                                           ---                       ---                              ---                          ---                              ---                          ---                         ---                             ---

                             Operating income                                       1,267                     1,364                            1,207                         1,264                            5,102                        1,340                       1,613                          2,953

                  Income from equity
                  investments                                               59                        43                               61                           40                              203                           61                          68                             129

                 Interest expense, net                                      (69)                     (65)                            (76)                        (84)                           (294)                        (86)                       (89)                          (175)

                  Other income (expense),
                  net                                                        6                       (8)                               1                         (13)                            (14)                          11                           6                              17

                 Reorganization items                                       - -                      (1)                                      - -                          - -                             (1)                         - -                        - -                            - -
                                                                           ---                      ---                                       ---                          ---                             ---                          ---                        ---                            ---

                              Income from
                              continuing
                              operations before
                              income taxes                                          1,263                     1,333                            1,193                         1,207                            4,996                        1,326                       1,598                          2,924

                  Provision for income
                  taxes                                                    357                       410                              339                           30                            1,136                          383                         425                             808
                                                                           ---                       ---                              ---                          ---                            -----                          ---                         ---                             ---

                              Income from
                              continuing
                              operations                                              906                       923                              854                         1,177                            3,860                          943                       1,173                          2,116

                  Income (loss) from
                  discontinued
                  operations,

                             net of tax                                               (6)                        4                              (3)                          (2)                             (7)                           1                           3                              4
                                                                                      ---                       ---                              ---                           ---                              ---                          ---                         ---                            ---

                                         Net income                                     900                       927                              851                         1,175                            3,853                          944                       1,176                          2,120

                  Net (income) loss
                  attributable to non-
                  controlling

                             interests                                                  1                         2                                2                           (1)                               4                            1                           2                              3
                                                                                      ---                       ---                              ---                           ---                              ---                          ---                         ---                            ---

                                          Net income
                                          attributable to
                                          the Company

                                                          shareholders                      $901                             $929                      $853                              $1,174                       $3,857                       $945                        $1,178                         $2,123
                                                                                            ====                             ====                      ====                              ======                       ======                       ====                        ======                         ======



    Table 11 - Charges (Benefits) Included in Income from Continuing Operations
    ---------------------------------------------------------------------------

                                                                                            2013                   2014
                                                                                            ----                   ----

    Millions of U.S. dollars
     (except share data)                                     Q1                    Q2          Q3     Q4                Total    Q1      Q2         YTD
    ------------------------                                 ---                  ---          ---    ---               -----   ---      ---        ---

    Pretax charges (benefits):

                                   Impairments                   $            - -         $       - -     $    - -                   $10        $10     $       - -    $    - - $      - -

                                    Insurance
                                    settlement                                - -                 - -          - -                  (25)      (25)            - -         - -        - -

                                    Settlement of
                                    environmental
                                    indemnification
                                    agreement                                 - -                 - -          - -                   - -       - -           (52)         - -       (52)

                                    Loss on sale
                                    of investment                             - -                 - -          - -                    16         16             - -         - -        - -

    Total pretax charges (benefits)                                        - -                 - -          - -                     1          1            (52)         - -       (52)

    Provision for income tax related to these
     items                                                                 - -                 - -          - -                     4          4             - -         - -        - -
                                                                           ---                 ---          ---                   ---        ---             ---         ---        ---

    After-tax effect of net
     charges (benefits)                                        $            - -         $       - -     $    - -                    $5         $5           $(52)    $    - -      $(52)
                                                             ===            ===       ===       ===   ===    ===                   ===        ===            ====   ===    ===       ====

    Effect on diluted earnings per
     share                                                     $            - -         $       - -     $    - -              $    - -     $ - -          $0.09     $    - -      $0.09



    Table 12 - Unaudited Cash Flow Information
    ------------------------------------------

                                                                        2013                         2014
                                                                        ----                         ----

                  (Millions of
                  U.S. dollars)       Q1              Q2  Q3        Q4              Total  Q1              Q2             YTD
                 -------------       ---             --- ---        ---             ----- ---             ---             ---

                  Net cash
                  provided by
                  operating
                  activities                    $799         $1,246          $1,116              $1,674            $4,835             $801       $1,797         $2,598

                  Net cash used
                  in investing
                  activities                   (408)         (389)          (438)              (367)          (1,602)         (2,011)       (246)       (2,257)

                 Net cash
                  provided by
                  (used in)
                  financing
                  activities                   (234)         (508)            452             (1,299)          (1,589)           (550)     (2,217)       (2,767)


    Table 13 - Unaudited Balance Sheet Information
    ----------------------------------------------

                                                                                March 31,            June 30,               September 30,         December 31,                March 31,           June 30,

                (Millions of U.S.
                dollars)                               2013                2013         2013                 2013                            2014               2014
               ------------------                      ----                ----         ----                 ----                            ----               ----

                Cash and cash
                equivalents                                 $2,879                $3,233                          $4,414                                 $4,450                         $2,702                       $2,030

               Restricted cash                                   6                     2                               4                                     10                              3                            2

               Short-term investments                                  - -                   - -                                      - -                            - -                                1,402                  1,299

               Accounts receivable, net                         3,878                 4,023                           4,041                                  4,030                          4,141                        4,264

               Inventories                                   5,270                 5,197                           5,382                                  5,279                          5,589                        5,326

                Prepaid expenses and
                other current assets                           622                   577                             784                                    830                          1,156                          784
                                                               ---                   ---                             ---                                    ---                          -----                          ---

                                          Total current
                                          assets                       12,655                 13,032                                    14,625                          14,599                                14,993                 13,705

                Property, plant and
                equipment, net                               7,779                 7,979                           8,223                                  8,457                          8,556                        8,740

                Investments and long-
                term receivables:

                                          Investment in PO
                                          joint ventures                  401                    409                                       423                             421                                   424                    418

                                          Equity
                                          investments                   1,607                  1,622                                     1,615                           1,629                                 1,693                  1,702

                                          Other
                                          investments and
                                          long-term
                                          receivables                     421                    231                                       164                              64                                    62                     58

               Goodwill                                        582                   588                             598                                    605                            605                          602

               Intangible assets, net                           999                   966                             934                                    904                            870                          838

               Other assets                                    233                   221                             229                                    619                            624                          593
                                                               ---                   ---                             ---                                    ---                            ---                          ---

                                         Total assets                 $24,677                $25,048                                   $26,811                         $27,298                               $27,827                $26,656
                                                                      =======                =======                                   =======                         =======                               =======                =======

                Current maturities of
                long-term debt                                  $1                    $1                              $1                                     $1                             $3                           $3

               Short-term debt                                 115                   114                             114                                     58                             58                           55

               Accounts payable                              3,217                 3,324                           3,241                                  3,572                          3,642                        3,690

               Accrued liabilities                           1,217                 1,047                           1,528                                  1,299                          1,477                        1,310

               Deferred income taxes                           557                   550                             494                                    580                            540                          570
                                                               ---                   ---                             ---                                    ---                            ---                          ---

                                          Total current
                                          liabilities                   5,107                  5,036                                     5,378                           5,510                                 5,720                  5,628

               Long-term debt                                4,307                 4,306                           5,774                                  5,776                          6,766                        6,766

               Other liabilities                             2,306                 2,325                           2,278                                  1,839                          1,838                        1,851

               Deferred income taxes                         1,277                 1,312                           1,472                                  1,659                          1,677                        1,623

               Stockholders' equity                         11,641                12,032                          11,874                                 12,478                         11,791                       10,753

                Non-controlling
                interests                                       39                    37                              35                                     36                             35                           35
                                                               ---                   ---                             ---                                    ---                            ---                          ---

                                          Total
                                          liabilities and
                                          stockholders'
                                          equity                      $24,677                $25,048                                   $26,811                         $27,298                               $27,827                $26,656
                                                                      =======                =======                                   =======                         =======                               =======                =======

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SOURCE LyondellBasell Industries


Source: PR Newswire



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