[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section provides the unaudited consolidated financial statements for Westlake Chemical Partners LP, detailing financial position, operational results, and cash flows for the period ended June 30, 2025 [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements, including balance sheets, statements of operations, and cash flows, for the period ended June 30, 2025 [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheet Highlights (Unaudited) | Account | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :--- | :--- | :--- | | **Total current assets** | 156,524 | 240,926 | | **Total assets** | **1,307,187** | **1,287,956** | | **Total current liabilities** | 72,906 | 55,372 | | **Long-term debt payable to Westlake** | 399,674 | 399,674 | | **Total liabilities** | 476,022 | 458,642 | | **Total equity** | 831,165 | 829,314 | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) Consolidated Statements of Operations Highlights (Unaudited) | Metric | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | | **Total net sales** | 297,119 | 284,168 | 534,748 | 568,841 | | **Gross profit** | 97,532 | 101,232 | 151,613 | 203,412 | | **Income from operations** | 91,232 | 93,627 | 137,839 | 188,730 | | **Net income** | 85,795 | 88,026 | 128,104 | 177,672 | | **Net income attributable to Westlake Chemical Partners LP** | 14,558 | 14,427 | 19,506 | 29,260 | | **Net income per limited partner unit (basic and diluted)** | $0.41 | $0.41 | $0.55 | $0.83 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Consolidated Statements of Cash Flows Highlights (Unaudited) | Cash Flow Activity | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :--- | :--- | :--- | | **Net cash provided by operating activities** | 54,852 | 226,461 | | **Net cash provided by (used for) investing activities** | 49,664 | (19,951) | | **Net cash used for financing activities** | (126,253) | (199,130) | | **Net increase (decrease) in cash and cash equivalents** | (21,737) | 7,380 | | **Cash and cash equivalents at end of period** | 36,579 | 65,999 | [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) - The Partnership was formed to operate ethylene production facilities, holding a **22.8% limited partner interest** in Westlake Chemical OpCo LP ("OpCo") and consolidating OpCo's financial results as the primary beneficiary, with Westlake Corporation owning the remaining **77.2% interest**[23](index=23&type=chunk)[24](index=24&type=chunk)[27](index=27&type=chunk) - A quarterly cash distribution of **$0.4714 per common unit** for Q2 2025 was declared on July 30, 2025, payable on August 27, 2025[39](index=39&type=chunk) - The Partnership has significant related-party transactions with Westlake, its major customer, with sales to Westlake accounting for approximately **86.0% of the Partnership's net sales** for the six months ended June 30, 2025[50](index=50&type=chunk)[70](index=70&type=chunk) - As of June 30, 2025, the Partnership had **$399.7 million in long-term debt** payable to Westlake, comprising borrowings under the OpCo Revolver and the MLP Revolver[71](index=71&type=chunk) - The Partnership operates as a **single reportable segment, OpCo**, encompassing its ethylene production operations[85](index=85&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the financial performance and condition of the Partnership, highlighting decreased net income and operating cash flow due to a planned maintenance turnaround [Partnership Overview and Revenue Generation](index=20&type=section&id=Partnership%20Overview%20and%20Revenue%20Generation) - The Partnership's primary asset is its **22.8% limited partner interest in OpCo**, which owns and operates three ethylene production facilities and a pipeline[90](index=90&type=chunk)[91](index=91&type=chunk) - Revenue is primarily generated through a long-term, fee-based Ethylene Sales Agreement with Westlake, including a minimum purchase commitment of **95% of budgeted production** and a fixed margin of **$0.10 per pound**, ensuring stable cash flows[93](index=93&type=chunk) [Results of Operations](index=23&type=section&id=Results%20of%20Operations) - **Q2 2025 vs Q2 2024:** Net income decreased by **$2.2 million to $85.8 million**, driven by higher feedstock and natural gas costs, partially offset by higher ethylene sales prices and a **$13.6 million buyer deficiency fee** from the Petro 1 turnaround[109](index=109&type=chunk)[111](index=111&type=chunk)[112](index=112&type=chunk) - **H1 2025 vs H1 2024:** Net income decreased by **$49.6 million to $128.1 million**, primarily due to lower sales volumes from the Petro 1 turnaround and higher feedstock and natural gas costs[110](index=110&type=chunk)[118](index=118&type=chunk)[119](index=119&type=chunk) Non-GAAP Financial Measures Reconciliation | Metric ($ thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net Income** | 85,795 | 88,026 | 128,104 | 177,672 | | **MLP distributable cash flow** | 15,007 | 17,135 | 19,721 | 34,027 | | **EBITDA** | 124,391 | 123,199 | 199,412 | 247,630 | [Cash Flow and Liquidity](index=27&type=section&id=Cash%20Flow%20and%20Liquidity) - Cash from operating activities decreased by **$171.6 million in H1 2025** compared to H1 2024, falling to **$54.9 million**, mainly due to Petro 1 turnaround costs and lower income from operations[125](index=125&type=chunk) - Sources of liquidity include cash from operations, a **$600 million OpCo Revolver**, a **$600 million MLP Revolver**, and an Investment Management Agreement with Westlake; cash and cash equivalents were **$36.6 million**, with an additional **$43.9 million invested with Westlake** as of June 30, 2025[130](index=130&type=chunk)[136](index=136&type=chunk)[137](index=137&type=chunk) - Total debt outstanding as of June 30, 2025, was **$399.7 million**, entirely owed to Westlake through the OpCo and MLP revolvers[138](index=138&type=chunk)[139](index=139&type=chunk)[148](index=148&type=chunk) - Capital expenditures for H1 2025 were **$40.3 million**, an increase from **$20.0 million in H1 2024**, primarily due to the Petro 1 turnaround[126](index=126&type=chunk)[135](index=135&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=29&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The Partnership's primary market risk is interest rate exposure on variable-rate debt, while commodity price risk is mitigated by a fee-based sales agreement - Direct exposure to commodity price risk is limited as the Ethylene Sales Agreement with Westlake provides for cost-plus based pricing and a minimum purchase commitment[147](index=147&type=chunk) - The main market risk is interest rate risk on **$399.7 million of variable-rate debt**, where a **1% (100 basis points) increase** in the average interest rate would increase annual interest expense by approximately **$4.0 million**[148](index=148&type=chunk) [Item 4. Controls and Procedures](index=29&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - Management concluded that the company's disclosure controls and procedures are effective as of the end of the period covered by the report[149](index=149&type=chunk) - There were no changes in internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[150](index=150&type=chunk) [PART II. OTHER INFORMATION](index=30&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, other information, and a list of exhibits filed with the report [Item 1. Legal Proceedings](index=30&type=section&id=Item%201.%20Legal%20Proceedings) The Partnership is involved in various legal proceedings but does not anticipate any material adverse effects, with Westlake Corporation providing indemnification for certain liabilities - The Partnership does not believe that any ongoing legal proceedings will have a material adverse effect on its financial condition, results of operations, or cash flows[154](index=154&type=chunk) - Westlake has agreed to indemnify the Partnership for certain environmental liabilities existing before August 4, 2014, and for liabilities related to services performed under the Services and Secondment Agreement[153](index=153&type=chunk) [Item 1A. Risk Factors](index=30&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred from the risk factors previously disclosed in the Partnership's Annual Report on Form 10-K for the fiscal year ended December 31, 2024 - There have been no material changes from the risk factors disclosed in the 2024 Form 10-K[155](index=155&type=chunk) [Item 5. Other Information](index=30&type=section&id=Item%205.%20Other%20Information) No director or officer of the Partnership's general partner adopted or terminated a Rule 10b5-1 trading arrangement during the second quarter of 2025 - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the second quarter of 2025[156](index=156&type=chunk) [Item 6. Exhibits](index=31&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including corporate governance documents and officer certifications - The report lists various exhibits filed, including the CEO and CFO certifications under Rule 13a-14(a) and Section 1350[158](index=158&type=chunk)

Core Insights - Westlake Chemical Partners reported a strong sequential rebound in key operating and cash metrics for Q2 2025, following a challenging prior quarter due to the Petro 1 turnaround [1][5] - Despite the recovery, the company fell short of market expectations for earnings per limited partner unit and revenue [1][6] - The partnership's reliance on a fixed-margin, take-or-pay contract with Westlake Corporation provides stability but also exposes it to volume risks [4][9] Financial Performance - Q2 2025 earnings per limited partner unit (GAAP) were $0.41, below the $0.47 analyst estimate, while revenue (GAAP) was $297.1 million, missing the $301.0 million consensus [1][2] - MLP distributable cash flow was $15.0 million, down 12.3% year-over-year from $17.1 million in Q2 2024, attributed to higher maintenance capital expenses [2][5] - Cash flows from operating activities plummeted 92.5% year-over-year, from $121.9 million in Q2 2024 to $9.1 million in Q2 2025, primarily due to the Petro 1 turnaround [2][7] Operational Context - The partnership's ethylene production facilities have a nameplate capacity of approximately 3.7 billion pounds per year, with 95% of output sold to Westlake under a long-term agreement [3][9] - The second quarter saw a recovery in net income attributable to the partnership, increasing from $4.9 million in Q1 2025 to $14.6 million in Q2 2025 [5] - Third-party ethylene sales decreased significantly to $28.0 million from $44.6 million in the prior-year period, reflecting the partnership's dependence on Westlake [6][10] Future Outlook - Management anticipates a solid improvement in distributable cash flow and distribution coverage ratio in the second half of 2025 as operations normalize [11] - No further maintenance shutdowns are scheduled for the next eighteen months, with no additional planned turnarounds in 2025 or 2026 [11][12] - The quarterly distribution remains unchanged at $0.4714 per unit, marking the forty-fourth consecutive quarter since the 2014 IPO [8][12]

Financial Data and Key Metrics Changes - Westlake Partners reported a net income of $15 million or $0.41 per unit for Q2 2025, which is consistent with Q2 2024 net income [6][8] - Consolidated net income, including OpCo's earnings, was $86 million, benefiting from a $14 million protection from the ethylene sales agreement [7][8] - Distributable cash flow decreased to $15 million or $0.43 per unit, down by $2 million compared to 2024 due to higher maintenance capital expenditures [8][9] - The partnership maintained a strong cash balance of $81 million and a long-term debt of $400 million, with a consolidated leverage ratio of approximately one time [9][10] Business Line Data and Key Metrics Changes - The stability of cash flow is attributed to the fixed margin ethylene sales agreement, which minimizes market volatility and production risks [6][12] - The successful completion of the PetroR1 turnaround positions the partnership for solid earnings and cash flows in the future [11][12] Market Data and Key Metrics Changes - Global industrial and manufacturing activity has been soft in 2025, impacting the global chemical industry [11] - The ethylene sales agreement provides a predictable fee-based cash flow structure, insulating the partnership from market fluctuations [12] Company Strategy and Development Direction - The company plans to evaluate growth opportunities through four levers: increasing ownership interest in OpCo, acquiring other qualified income streams, organic growth through facility expansions, and negotiating higher fixed margins in the ethylene sales agreement [12] - The focus remains on providing long-term value and distributions to unitholders while maintaining safe operations and environmental stewardship [12] Management's Comments on Operating Environment and Future Outlook - Management noted that despite the challenging macroeconomic backdrop, financial performance and distributions will continue to be supported by the ethylene sales agreement [11][12] - There is no immediate need for Westlake Corporation to raise equity capital, indicating a stable financial position [18] Other Important Information - The partnership has made 44 consecutive quarterly distributions since its IPO in July 2014, with a 71% increase in distributions since the original minimum quarterly distribution [9][10] Q&A Session Summary Question: Will the outage impact from Q2 affect OpCo assets in Q3? - Management confirmed that the ethylene unit was not affected by the outage and is running reliably post-turnaround [17] Question: Are certain growth opportunities more appealing in the current environment? - Management indicated that there is no immediate need for capital, and the markets have contracted, making it unlikely to raise equity capital in the current year [18]

Westlake Chemical Partners LP Second Quarter 2025 Earnings Release [Financial and Operational Highlights](index=1&type=section&id=Financial%20and%20Operational%20Highlights) The Partnership reported stable net income but lower cash flow in Q2 2025 due to a major facility turnaround, with results improving sequentially [Second Quarter 2025 Performance vs. Prior Periods](index=1&type=section&id=Second%20Quarter%202025%20Performance%20vs.%20Prior%20Periods) Q2 2025 net income was flat year-over-year, but cash flow declined significantly due to higher maintenance capital expenditures Q2 2025 vs. Q2 2024 Performance | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net Income Attributable to Partnership | $14.6 million | $14.4 million | +$0.2 million | | Cash Flows from Operating Activities | $9.1 million | $121.9 million | -$112.8 million | | MLP Distributable Cash Flow | $15.0 million | $17.1 million | -$2.1 million | Q2 2025 vs. Q1 2025 Performance | Metric | Q2 2025 | Q1 2025 | Change | | :--- | :--- | :--- | :--- | | Net Income Attributable to Partnership | $14.6 million | $4.9 million* | +$9.7 million | | Cash Flows from Operating Activities | $9.1 million | $45.8 million | -$36.7 million | | MLP Distributable Cash Flow | $15.0 million | $4.7 million | +$10.3 million | *Note: Q1 2025 Net Income calculated from Q2 increase ($14.6M - $9.7M)* - The year-over-year decrease in MLP distributable cash flow was primarily due to **higher maintenance capital expenditures** resulting from the Petro 1 turnaround[2](index=2&type=chunk) - The sequential increase in net income and MLP distributable cash flow from Q1 2025 was driven by **higher production and sales volume** as the Petro 1 turnaround had fewer impactful days in Q2[3](index=3&type=chunk) [Management Commentary and Outlook](index=1&type=section&id=Management%20Commentary%20and%20Outlook) Management noted significant sequential improvement post-turnaround and expects a strong recovery in cash flow for the second half of 2025 - Financial results improved significantly from Q1 2025 due to **higher production and sales volume** at the Petro 1 facility after its turnaround[5](index=5&type=chunk) - Management expects distributable cash flow and the associated coverage ratio to **"solidly improve in the second half of 2025 back towards our strong historical levels"**[5](index=5&type=chunk) [Distributions and Coverage Ratio](index=1&type=section&id=Distributions%20and%20Coverage%20Ratio) The Partnership declared its 44th consecutive quarterly distribution, though the trailing twelve-month coverage ratio declined to 0.79x Key Distribution Metrics | Metric | Value | | :--- | :--- | | Quarterly Distribution per Unit | $0.4714 | | Consecutive Quarterly Distributions | 44 | | Trailing 12-Month Coverage Ratio | 0.79x | | Cumulative IPO Coverage Ratio | ~1.05x | - The decline in the trailing twelve-month coverage ratio to **0.79x** from 0.82x in Q1 2025 was attributed to the planned Petro 1 turnaround[5](index=5&type=chunk) [Financial Statements](index=4&type=section&id=Financial%20Statements) Unaudited consolidated statements show stable Q2 net income year-over-year, but a significant decrease in cash from operations [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) Q2 2025 net sales increased, but higher cost of sales resulted in stable net income attributable to the Partnership Statement of Operations Summary | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total net sales | $297,119 | $284,168 | | Gross profit | $97,532 | $101,232 | | Income from operations | $91,232 | $93,627 | | Net income attributable to Westlake Partners | $14,558 | $14,427 | | Net income per limited partner unit | $0.41 | $0.41 | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets and equity remained stable as of June 30, 2025, while cash and cash equivalents decreased since year-end 2024 Balance Sheet Summary | (In thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $36,579 | $58,316 | | Total current assets | $156,524 | $240,926 | | Total assets | $1,307,187 | $1,287,956 | | **Liabilities and Equity** | | | | Total liabilities | $476,022 | $458,642 | | Total equity | $831,165 | $829,314 | | Total liabilities and equity | $1,307,187 | $1,287,956 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities for the first half of 2025 was significantly lower than the prior-year period Cash Flow Summary | (In thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $54,852 | $226,461 | | Net cash provided by (used for) investing activities | $49,664 | $(19,951) | | Net cash used for financing activities | $(126,253) | $(199,130) | | Net (decrease) increase in cash | $(21,737) | $7,380 | | Cash and cash equivalents at end of period | $36,579 | $65,999 | [Reconciliation of Non-GAAP Financial Measures](index=7&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) This section provides reconciliations from GAAP figures to the Partnership's key non-GAAP performance metrics, MLP Distributable Cash Flow and EBITDA [Reconciliation of MLP Distributable Cash Flow](index=7&type=section&id=Reconciliation%20of%20MLP%20Distributable%20Cash%20Flow) Q2 2025 MLP distributable cash flow of $15.0 million is reconciled from net income by adjusting for non-cash items and other factors MLP Distributable Cash Flow Reconciliation | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net income | $85,795 | $88,026 | | Add: Depreciation, etc. | $32,872 | $29,869 | | Less: Maintenance capital expenditures | $(20,506) | $(9,306) | | Less: Distributable cash flow attributable to noncontrolling interest | $(72,758) | $(82,782) | | **MLP distributable cash flow** | **$15,007** | **$17,135** | [Reconciliation of EBITDA](index=8&type=section&id=Reconciliation%20of%20EBITDA) EBITDA for Q2 2025 was $124.4 million, showing a slight year-over-year increase and a substantial sequential improvement EBITDA Reconciliation | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net income | $85,795 | $88,026 | | Interest expense—Westlake | $5,907 | $6,651 | | Provision for income taxes | $205 | $207 | | Depreciation and amortization | $32,484 | $28,315 | | **EBITDA** | **$124,391** | **$123,199** | [Disclosures and Other Information](index=2&type=section&id=Disclosures%20and%20Other%20Information) This section contains standard corporate disclosures, including forward-looking statements, non-GAAP measure definitions, and company information [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) The company cautions that forward-looking remarks regarding future performance are subject to significant risks and uncertainties - Statements regarding future expectations, such as **improved distributable cash flow and coverage ratios**, are considered forward-looking and are not guarantees of future performance[7](index=7&type=chunk) [Use of Non-GAAP Financial Measures](index=2&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) The release defines and justifies the use of non-GAAP measures to provide supplemental information for assessing operating performance - The company uses non-GAAP measures like **MLP distributable cash flow, coverage ratio, and EBITDA** to provide supplemental information on business trends and performance[9](index=9&type=chunk) - These measures are used by management and external parties to assess **operating performance, ability to service debt, and fund capital expenditures**[9](index=9&type=chunk) [Company Overview](index=2&type=section&id=Company%20Overview) Westlake Chemical Partners LP is a limited partnership focused on operating and developing ethylene production facilities - The Partnership was formed by Westlake Corporation to **operate, acquire, and develop ethylene production facilities**[10](index=10&type=chunk) - It owns a **22.8% interest in Westlake Chemical OpCo LP**, whose assets include three ethylene production facilities and a pipeline[10](index=10&type=chunk) [Conference Call Information](index=3&type=section&id=Conference%20Call%20Information) A conference call to discuss Q2 2025 financial results is scheduled for Tuesday, August 5, 2025, at 1:00 PM Eastern Time - A conference call to discuss Q2 2025 results is scheduled for **August 5, 2025, at 1:00 PM Eastern Time**[11](index=11&type=chunk)

Core Viewpoint - Westlake Chemical Partners LP (NYSE: WLKP) is currently trading at $22.05 per share, with the market exhibiting a pessimistic outlook due to a temporary operational downturn, which may have led to an undervaluation of the company [1]. Group 1 - The market's focus on the temporary operational downturn has overshadowed the company's long-term potential and fundamentals [1]. - The current share price reflects an overly negative sentiment that may not align with the company's intrinsic value [1].

Financial Performance - Total net sales for the three months ended March 31, 2025, were $237.629 million, a decrease of 16.5% compared to $284.673 million for the same period in 2024[10] - Gross profit for the first quarter of 2025 was $54.081 million, down 47% from $102.180 million in the first quarter of 2024[10] - Net income attributable to Westlake Chemical Partners LP for Q1 2025 was $4.948 million, a decline of 66.7% from $14.833 million in Q1 2024[10] - The Partnership's net income attributable for the three months ended March 31, 2025, was $4,948,000, a decrease of 66.7% compared to $14,833,000 for the same period in 2024[40] - For the three months ended March 31, 2025, net income was $42,309, a decrease of 52.8% compared to $89,646 for the same period in 2024[83] Cash and Liquidity - Cash and cash equivalents decreased to $49.624 million as of March 31, 2025, from $58.316 million at the end of 2024, representing a decline of 14.5%[18] - The company reported a net cash provided by operating activities of $45.781 million for Q1 2025, down from $104.565 million in Q1 2024, a decrease of 56.3%[18] - Distributions to unitholders for the first quarter of 2025 totaled $16.611 million, compared to $16.607 million in the same period of 2024, showing a marginal increase[18] - The Partnership's distribution in excess of net income for the three months ended March 31, 2025, was $11,663,000, compared to $1,774,000 for the same period in 2024, indicating a significant increase in distribution pressure[40] Assets and Liabilities - Total assets increased to $1.371 billion as of March 31, 2025, compared to $1.288 billion at the end of 2024, reflecting a growth of 6.4%[8] - Total liabilities rose to $568.246 million as of March 31, 2025, up from $458.642 million at the end of 2024, indicating a 24% increase[8] - The Partnership's total equity decreased to $803.1 million as of March 31, 2025, from $829.3 million at the end of 2024, a decline of 3.2%[8] - Accrued and other liabilities increased significantly to $63,336 as of March 31, 2025, from $16,920 as of December 31, 2024[75] Accounts Receivable and Inventory - Accounts receivable from trade customers increased to $13,310,000 as of March 31, 2025, from $11,757,000 as of December 31, 2024, representing a growth of 13.2%[33] - Total inventories decreased to $2,733,000 as of March 31, 2025, down from $4,058,000 as of December 31, 2024, indicating a decline of 32.7%[34] - Accounts receivable from Westlake rose to $55,051 as of March 31, 2025, compared to $31,975 as of December 31, 2024, indicating a significant increase of 72.5%[59] Related Party Transactions - Sales to related parties (Westlake) for the three months ended March 31, 2025, were $190,781,000, down 19.0% from $235,209,000 in 2024[49] - Charges for feedstock purchased from Westlake included in cost of sales were $85,499,000 for the three months ended March 31, 2025, compared to $78,537,000 in 2024, reflecting an increase of 8.3%[50] - Interest expense related to debt payable to Westlake decreased to $5,537 for the three months ended March 31, 2025, from $6,581 in 2024, a reduction of 15.9%[65] - Operating lease rentals paid to Westlake were $338 for the three months ended March 31, 2025, down from $425 in 2024, a decrease of 20.5%[62] Operational Focus - The company plans to continue focusing on the development of ethylene production facilities and related assets to enhance operational efficiency and market presence[22]

Financial Data and Key Metrics Changes - Westlake Partners reported a net income of $5 million or $0.14 per unit for Q1 2025, which is $10 million lower than Q1 2024 due to lower production and sales volume from the planned turnaround at Petro one [6][7] - Consolidated net income, including OpCo's earnings, was $42 million on consolidated net sales of $238 million [7] - Distributable cash flow for the quarter was $5 million or $0.13 per unit, a decrease of $12 million compared to Q1 2024 [7][8] Business Line Data and Key Metrics Changes - The planned turnaround at the Petro one ethylene unit in Lake Charles, Louisiana, resulted in lower production and sales volume, impacting overall earnings [6][7] - The partnership maintained a strong leverage ratio of approximately one times, with long-term debt at $400 million [8] Market Data and Key Metrics Changes - The company noted that global trade tensions have intensified, creating uncertainty for businesses and investors, which may lead to market volatility [10][11] Company Strategy and Development Direction - The company plans to evaluate growth opportunities through increasing ownership interest in OpCo, acquiring other qualified income streams, and organic growth opportunities such as facility expansions [11] - The ethylene sales agreement provides a predictable fee-based cash flow structure, supporting financial performance and distributions [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the stability of cash flows due to the fixed margin ethylene sales agreement, which mitigates market volatility [6][10] - The company anticipates solid production levels following the successful completion of the Petro one turnaround [10] Other Important Information - The partnership has maintained a cumulative distribution coverage ratio of approximately 1.1 times since its IPO in 2014, with 43 consecutive quarterly distributions [8][9] - The first quarter distribution of $0.04 per unit will be paid on May 29, 2025 [9] Q&A Session Summary Question: The financial impact of the Q1 turnaround at TETRA one seems significant. Can you explain? - Management indicated that the impact was as planned, with the unit down for February and March, and elevated interest rates may also be a factor affecting financial performance [15][16] Question: Is there still enough valuation difference to justify keeping Westlake healthy around? - Management noted that while the parent company has seen some valuation compression, the value proposition remains strong over the business cycle [17][18]

Financial Data and Key Metrics Changes - Westlake Partners reported a net income of $5 million or $0.14 per unit for Q1 2025, which is $10 million lower than Q1 2024 due to lower production and sales volume from the planned turnaround at Petro one [6][7] - Consolidated net income, including OpCo's earnings, was $42 million on consolidated net sales of $238 million [7] - Distributable cash flow for the quarter was $5 million or $0.13 per unit, a decrease of $12 million compared to Q1 2024 [7][8] Business Line Data and Key Metrics Changes - The planned turnaround at the Petro one ethylene unit in Lake Charles, Louisiana, resulted in lower production and sales volume, impacting overall earnings [6][7] - The partnership maintained a strong leverage ratio of approximately one times, with long-term debt at $400 million [8] Market Data and Key Metrics Changes - The partnership's predictable fee-based cash flow structure continues to provide stability amid global trade tensions and market volatility [10][11] - The ethylene sales agreement with Westlake ensures predictable cash flows, covering 95% of OpCo's production [10][11] Company Strategy and Development Direction - The company plans to evaluate growth opportunities through increasing ownership interest in OpCo, acquiring other qualified income streams, and organic growth through facility expansions [11] - The focus remains on providing long-term value and distributions to unitholders while maintaining safe operations and environmental stewardship [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledged intensified global trade tensions creating uncertainty but emphasized the stability provided by the ethylene sales agreement [10] - The successful completion of the Petro one turnaround positions the company for solid production levels in the future [10][11] Other Important Information - The partnership has maintained 43 consecutive quarterly distributions since its IPO in July 2014, with a cumulative distribution coverage ratio of approximately 1.1 times [8][9] - The first quarter distribution of $0.04 per unit will be paid on May 29, 2025, to unitholders of record on May 13, 2025 [9] Q&A Session Summary Question: Financial impact of the Q1 turnaround at TETRA one - Management indicated that the impact was as planned, with the unit down for February and March, and elevated interest rates may have affected loan obligations [15][16] Question: Evaluation difference between Westlake and Westlake LP - Management noted that while the parent company has seen valuation compression, the value proposition remains strong over the business cycle, and the valuation differential remains elevated [17][18]

Financial Data and Key Metrics Changes - Westlake Partners reported a net income of $5 million or $0.14 per unit for Q1 2025, which is $10 million lower than Q1 2024 due to lower production and sales volume from the planned turnaround at Petro one [6][8] - Consolidated net income, including OpCo's earnings, was $42 million on consolidated net sales of $238 million [8] - Distributable cash flow for the quarter was $5 million or $0.13 per unit, a decrease of $12 million compared to Q1 2024 [8][10] Business Line Data and Key Metrics Changes - The planned turnaround at the Petro one ethylene unit in Lake Charles, Louisiana, resulted in lower production and sales volume, impacting overall earnings [6][8] - The partnership maintained a strong leverage ratio of approximately one times, with long-term debt at $400 million [9] Market Data and Key Metrics Changes - The company noted that global trade tensions have intensified, creating uncertainty for businesses and investors, which may lead to market volatility [11] - The ethylene sales agreement provides a predictable fee-based cash flow structure, supporting financial performance despite market conditions [11] Company Strategy and Development Direction - The company plans to evaluate growth opportunities through increasing ownership interest in OpCo, acquisitions of other income streams, and organic growth through facility expansions [12] - The focus remains on maintaining a strong balance sheet and conservative financial metrics while providing long-term value and distributions to unitholders [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the stability of cash flows due to the fixed margin ethylene sales agreement, which mitigates market volatility [6][11] - The successful completion of the Petro one turnaround positions the company for solid production levels in the future [12] Other Important Information - The partnership has made 43 consecutive quarterly distributions since its IPO in July 2014, with a cumulative distribution coverage ratio of approximately 1.1 times [10][12] - The first quarter distribution of $0.04 per unit will be paid on May 29, 2025 [10] Q&A Session Summary Question: The financial impact of the Q1 turnaround at TETRA one seems significant. Can you explain? - Management indicated that the impact was as planned, with the unit down for February and March, and elevated interest rates may have also affected performance [17][18] Question: Is there still enough valuation difference to justify keeping Westlake healthy around? - Management noted that while the parent company has seen some valuation compression, the value proposition remains strong over the business cycle [19][20]

[First Quarter 2025 Results Overview](index=1&type=section&id=first-quarter-2025-results-overview) Westlake Chemical Partners LP experienced a significant decline in Q1 2025 financial performance due to the planned Petro 1 turnaround, impacting net income and cash flows [Key Financial Highlights](index=1&type=section&id=key-financial-highlights) Westlake Chemical Partners LP reported a significant decrease in net income, cash flows from operating activities, and MLP distributable cash flow for Q1 2025 compared to Q1 2024 and Q4 2024, primarily due to the planned Petro 1 turnaround Key Financial Highlights (in millions of dollars) | Metric | Q1 2025 | Q1 2024 | Change (YoY) | Q4 2024 | Change (QoQ) | | :-------------------------------- | :------ | :------ | :----------- | :------ | :----------- | | Net income attributable to Partnership | $4.9 | $14.8 | -$9.9 | $15.0 (approx) | -$10.1 | | Cash flows from operating activities | $45.8 | $104.6 | -$58.8 | $132.5 | -$86.7 | | MLP distributable cash flow | $4.7 | $16.9 | -$12.2 | $15.0 | -$10.3 | - The decrease in financial performance was primarily attributed to lower production and sales volume and higher maintenance capital expenditures resulting from the planned Petro 1 turnaround[2](index=2&type=chunk)[3](index=3&type=chunk) [Management Commentary & Outlook](index=1&type=section&id=management-commentary-and-outlook) The CEO confirmed that the negative impact on Q1 2025 distributable cash flow and coverage ratio was expected due to the Petro 1 turnaround, which began in late January and extended into early April. The facility has since returned to full operating rates, and the Partnership anticipates a return to strong historical levels for distributable cash flow and coverage ratio in coming quarters, with no further turnarounds planned for several years - The planned turnaround at the Petro 1 ethylene facility in Lake Charles, Louisiana, negatively impacted Q1 2025 distributable cash flow and coverage ratio[4](index=4&type=chunk) - Petro 1 returned to full operating rates in April 2025 and has been operating well since[4](index=4&type=chunk) - Management expects distributable cash flow and coverage ratio to return to strong historical levels in coming quarters, with no further turnarounds planned for several years[4](index=4&type=chunk) [Quarterly Distribution](index=1&type=section&id=quarterly-distribution) The Partnership declared its 43rd consecutive quarterly distribution of $0.4714 per common unit for Q1 2025. The trailing twelve-month coverage ratio for Q1 2025 was 0.82x, a decrease from 1.01x in Q4 2024, primarily due to the Petro 1 turnaround Quarterly Distribution and Coverage Ratio | Metric | Q1 2025 | Q4 2024 | | :-------------------------------- | :------ | :------ | | Quarterly distribution per unit | $0.4714 | $0.4714 | | Trailing twelve-month coverage ratio | 0.82x | 1.01x | - The decrease in the coverage ratio was attributed to the planned Petro 1 turnaround[4](index=4&type=chunk) [Company Information](index=1&type=section&id=company-information) Westlake Chemical Partners LP, a limited partnership formed by Westlake Corporation, operates and develops ethylene production facilities, holding a 22.8% interest in Westlake Chemical OpCo LP [Business Description](index=2&type=section&id=business-description) Westlake Chemical Partners LP is a limited partnership formed by Westlake Corporation to operate, acquire, and develop ethylene production facilities and other qualified assets. It holds a 22.8% interest in Westlake Chemical OpCo LP, which owns three ethylene production facilities and an ethylene pipeline - Westlake Chemical Partners LP is a limited partnership formed by Westlake Corporation[9](index=9&type=chunk) - The Partnership owns a **22.8% interest** in Westlake Chemical OpCo LP[9](index=9&type=chunk) - OpCo's assets include three ethylene production facilities in Calvert City, Kentucky, and Lake Charles, Louisiana, and an ethylene pipeline[9](index=9&type=chunk) [Ethylene Sales Agreement](index=1&type=section&id=ethylene-sales-agreement) OpCo's Ethylene Sales Agreement with Westlake Corporation is structured to provide stable and predictable cash flows. Under this agreement, 95% of OpCo's ethylene production is sold to Westlake for a fixed cash margin of $0.10 per pound, after accounting for operating costs, maintenance capital expenditures, and reserves for future turnaround expenditures - The Ethylene Sales Agreement with Westlake is designed to provide stable and predictable cash flows[5](index=5&type=chunk) - **95%** of OpCo's ethylene production is sold to Westlake for a cash margin of **$0.10 per pound**[5](index=5&type=chunk) - The margin is net of operating costs, maintenance capital expenditures, and reserves for future turnaround expenditures[5](index=5&type=chunk) [Financial Statements](index=4&type=section&id=financial-statements) Westlake Partners' Q1 2025 financial statements reveal a significant decline in operational profitability and cash flow compared to the prior year, alongside an increase in total assets and liabilities [Consolidated Statements of Operations](index=4&type=section&id=consolidated-statements-of-operations) For the three months ended March 31, 2025, Westlake Partners reported a significant decline in total net sales, gross profit, and net income attributable to the Partnership compared to the same period in 2024, primarily driven by lower sales to Westlake Corporation Consolidated Statements of Operations (in thousands of dollars) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--------------------------------- | :-------------------------------- | :-------------------------------- | | Total net sales | $237,629 | $284,673 | | Cost of sales | $183,548 | $182,493 | | Gross profit | $54,081 | $102,180 | | Income from operations | $46,607 | $95,103 | | Net income attributable to Westlake Partners | $4,948 | $14,833 | | Net income per limited partner unit | $0.14 | $0.42 | [Condensed Consolidated Balance Sheets](index=5&type=section&id=condensed-consolidated-balance-sheets) As of March 31, 2025, Westlake Partners' total assets increased compared to December 31, 2024, mainly due to a significant rise in other assets, net. Total liabilities also saw a substantial increase, primarily in current liabilities, while total equity decreased Condensed Consolidated Balance Sheets (in thousands of dollars) | Metric | March 31, 2025 | December 31, 2024 | | :------------------------------- | :------------- | :---------------- | | Total current assets | $225,151 | $240,926 | | Property, plant and equipment, net | $903,497 | $903,588 | | Other assets, net | $242,704 | $143,442 | | Total assets | $1,371,352 | $1,287,956 | | Total liabilities | $568,246 | $458,642 | | Total equity | $803,106 | $829,314 | - Current liabilities increased significantly from **$55,372 thousand** at December 31, 2024, to **$164,822 thousand** at March 31, 2025[14](index=14&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=condensed-consolidated-statements-of-cash-flows) For the three months ended March 31, 2025, net cash provided by operating activities decreased significantly compared to the prior year. Investing activities shifted from a net use of cash to a net provision of cash, while net cash used for financing activities also decreased Condensed Consolidated Statements of Cash Flows (in thousands of dollars) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--------------------------------- | :-------------------------------- | :-------------------------------- | | Net cash provided by operating activities | $45,781 | $104,565 | | Net cash provided by (used for) investing activities | $14,044 | ($9,773) | | Net cash used for financing activities | ($68,517) | ($97,651) | | Net decrease in cash and cash equivalents | ($8,692) | ($2,859) | | Cash and cash equivalents at end of period | $49,624 | $55,760 | - The shift in investing activities was primarily due to maturities of investments with Westlake under the Investment Management Agreement[16](index=16&type=chunk) [Non-GAAP Financial Measures](index=2&type=section&id=non-gaap-financial-measures) Westlake Partners utilizes non-GAAP financial measures, including MLP distributable cash flow, coverage ratio, and EBITDA, to offer investors supplemental insights into its operational performance and financial health [Definition and Purpose](index=2&type=section&id=definition-and-purpose) Westlake Partners uses non-GAAP financial measures such as MLP distributable cash flow, coverage ratio, and EBITDA to provide supplemental information to investors. These measures help assess underlying business trends, operating performance, debt servicing ability, and investment viability, complementing U.S. GAAP results - Non-GAAP measures like MLP distributable cash flow, coverage ratio, and EBITDA provide useful supplemental information for investors[8](index=8&type=chunk) - MLP distributable cash flow is defined as distributable cash flow less amounts attributable to noncontrolling interest and incentive distribution rights holder, not reflecting changes in working capital[8](index=8&type=chunk) - EBITDA is defined as net income before interest expense, income taxes, depreciation, and amortization[8](index=8&type=chunk) [MLP Distributable Cash Flow Reconciliation](index=7&type=section&id=mlp-distributable-cash-flow-reconciliation) The reconciliation shows a significant decrease in MLP distributable cash flow for Q1 2025 compared to both Q4 2024 and Q1 2024, primarily due to higher maintenance capital expenditures and lower net cash provided by operating activities MLP Distributable Cash Flow Reconciliation (in thousands of dollars) | Metric | Three Months Ended Dec 31, 2024 | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--------------------------------- | :------------------------------ | :-------------------------------- | :-------------------------------- | | Net cash provided by operating activities | $132,469 | $45,781 | $104,565 | | Net income | $87,387 | $42,309 | $89,646 | | Add: Depreciation, amortization and disposition of property, plant and equipment | $27,582 | $27,171 | $28,265 | | Less: Contribution to turnaround reserves | ($11,829) | ($7,622) | ($11,476) | | Less: Maintenance capital expenditures | ($15,923) | ($20,577) | ($7,749) | | Less: Distributable cash flow attributable to noncontrolling interest in OpCo | ($72,259) | ($36,567) | ($81,794) | | MLP distributable cash flow | $14,958 | $4,714 | $16,892 | [EBITDA Reconciliation](index=8&type=section&id=ebitda-reconciliation) EBITDA for Q1 2025 decreased substantially compared to both Q4 2024 and Q1 2024, reflecting the lower net income and income from operations during the period EBITDA Reconciliation (in thousands of dollars) | Metric | Three Months Ended Dec 31, 2024 | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--------------------------------- | :------------------------------ | :-------------------------------- | :-------------------------------- | | Net cash provided by operating activities | $132,469 | $45,781 | $104,565 | | Net income | $87,387 | $42,309 | $89,646 | | Income from operations | $92,025 | $46,607 | $95,103 | | Add: Depreciation and amortization | $27,478 | $27,068 | $27,994 | | EBITDA | $120,838 | $75,021 | $124,431 | [Additional Information](index=2&type=section&id=additional-information) This section provides crucial context regarding forward-looking statements, a qualified notice for tax purposes, and details for the Q1 2025 earnings conference call [Forward-Looking Statements](index=2&type=section&id=forward-looking-statements) The release contains forward-looking statements regarding future events, such as turnaround timing, future distributable cash flow, and market conditions. These statements are subject to significant risks and uncertainties, including operating difficulties, market prices, feedstock costs, and regulatory changes, which could cause actual results to differ materially - Statements about future turnarounds, distributable cash flow, ethylene margins, and feedstock costs are forward-looking[6](index=6&type=chunk) - Actual results may differ materially due to risks such as operating difficulties, sales volume and price, feedstock availability, economic conditions, and regulatory changes[6](index=6&type=chunk) [Qualified Notice](index=2&type=section&id=qualified-notice) This release serves as a qualified notice under Treasury Regulation Section 1.1446-4(b). Brokers and nominees should treat 100% of the Partnership's distributions to non-U.S. investors as income effectively connected with a U.S. trade or business, making them subject to federal income tax withholding at the highest applicable effective tax rate - The release is a qualified notice under Treasury Regulation Section 1.1446-4(b)[7](index=7&type=chunk) - **100%** of distributions to non-U.S. investors are considered effectively connected with a U.S. trade or business[7](index=7&type=chunk) - Distributions to non-U.S. investors are subject to federal income tax withholding at the highest applicable effective tax rate[7](index=7&type=chunk) [Conference Call Details](index=3&type=section&id=conference-call-details) A conference call to discuss Westlake Chemical Partners' first quarter 2025 results was scheduled for Friday, May 2, 2025, at 1:00 PM Eastern Time. Registration and webcast details were provided - Conference call for Q1 2025 results was held on Friday, May 2, 2025, at **1:00 PM Eastern Time**[10](index=10&type=chunk) - Registration and webcast links were provided for access[10](index=10&type=chunk)