LyondellBasell(US:LYB)2021-10-28 16:00Financial Performance - Revenues increased by $5,924 million, or 87%, in Q3 2021 compared to Q3 2020, and by $13,527 million, or 68%, in the first nine months of 2021 compared to the same period in 2020[122] - Operating income rose by $2,225 million, or 9,674%, in Q3 2021 compared to Q3 2020, and by $5,196 million, or 780%, in the first nine months of 2021 compared to the same period in 2020[126] - Comprehensive income increased by $1,443 million in Q3 2021 compared to Q3 2020, primarily due to higher net income[129] - Revenues increased by $1,187 million, or 108%, in Q3 2021 compared to Q3 2020, and by $1,891 million, or 55%, in the first nine months of 2021 compared to the same period in 2020, driven by higher product prices and improved demand[160] Segment Performance - The O&P–Americas segment generated sales of $4,408 million in Q3 2021, up from $1,840 million in Q3 2020[137] - O&P–Americas segment revenues increased by $2,568 million, or 140%, in Q3 2021 compared to Q3 2020, and by $5,925 million, or 117%, in the first nine months of 2021 compared to the same period in 2020[142] - EBITDA for the O&P–Americas segment rose by $1,094 million, or 231%, in Q3 2021 compared to Q3 2020, and by $2,923 million, or 269%, in the first nine months of 2021 compared to the same period in 2020[143] - O&P–EAI segment revenues increased by $1,476 million, or 74%, in Q3 2021 compared to Q3 2020, and by $4,052 million, or 69%, in the first nine months of 2021 compared to the same period in 2020[147] - EBITDA for the I&D segment increased by $1,356 million, or 88%, in Q3 2021 compared to Q3 2020, and by $2,781 million, or 62%, in the first nine months of 2021 compared to the same period in 2020[150] - Advanced Polymer Solutions segment revenues increased by $282 million, or 28%, in Q3 2021 compared to Q3 2020, and by $1,087 million, or 39%, in the first nine months of 2021 compared to the same period in 2020[154] - EBITDA for the Refining segment increased by $733 million, or 106%, in Q3 2021 compared to Q3 2020, primarily due to margin improvements and the absence of a non-cash impairment charge recognized in Q3 2020[161] - The Technology segment's revenues increased by $45 million, or 23%, in Q3 2021 compared to Q3 2020, driven by higher catalyst volumes and licensing revenues[164] Costs and Expenses - Cost of sales increased by $4,224 million, or 72%, in Q3 2021 compared to Q3 2020, primarily due to higher feedstock and energy costs[123] - EBITDA decreased by $36 million, or 23%, in Q3 2021 compared to Q3 2020, but increased by $159 million, or 70%, in the first nine months of 2021 compared to the same period in 2020[155] - Polyethylene results led to a 86% and 78% increase in EBITDA in the O&P–EAI segment for Q3 and the first nine months of 2021, respectively[148] - The absence of LCM inventory valuation benefits in the APS segment resulted in a decrease in EBITDA for Q3 2021 compared to Q3 2020[153] Debt and Cash Management - The company repaid $2,378 million of debt during the first nine months of 2021 and an additional $650 million in October 2021[118] - Total debt, including current maturities, was $13,516 million, with an additional $224 million in outstanding letters of credit and guarantees[186] - The company repaid $2,275 million in debt during the first nine months of 2021 and expects a total debt reduction of up to $4 billion for the year[187] - Cash provided by operating activities was $4,616 million in the first nine months of 2021, reflecting a significant increase from $2,661 million in the same period in 2020[168] - Capital expenditures totaled $1,285 million in the first nine months of 2021, down from $1,673 million in the same period in 2020, with a focus on profit-generating growth projects[177] - The company made dividend payments totaling $1,110 million in the first nine months of 2021, compared to $1,053 million in the same period in 2020[178] - As of September 30, 2021, the company had cash and cash equivalents totaling $1,929 million, with $1,593 million held outside the U.S.[185] - The company has $3,004 million in unused availability under its credit facilities as of September 30, 2021[187] Strategic Initiatives - The company is considering strategic options for its Houston refinery, including a potential sale, which would require Board approval and regulatory clearances[162] - The company plans to prioritize debt reduction while maintaining a strong investment-grade balance sheet as part of its capital allocation strategy[184] - The company has approximately 32.2 million shares remaining under its current share repurchase authorization, with 1.0 million shares repurchased for $89 million in the first nine months of 2021[190][191] - Cash generation is expected to improve, allowing for further strengthening of the investment-grade balance sheet and opportunistic share repurchases[193] - The company extended the term of its $900 million U.S. Receivables Facility to June 2024[190] Market Outlook and Risks - The company anticipates strong demand for its products due to vaccine rollouts and expects ongoing benefits from strong markets despite potential margin moderation[192] - The company faces various risks, including raw material cost volatility and potential operational interruptions, which could impact future results[198] - The effective income tax rate for Q3 2021 was 20.4%, compared to 1,136.4% for Q3 2020[128] - Approximately 60% of the raw materials used in North American olefins plants were ethane during Q3 2021[140] - The I&D segment's EBITDA increased due to higher margins across most businesses driven by tight market supply and strong demand recovery[150] - The company may enter into interest rate swap agreements to manage interest rate risk, converting fixed rate debt to variable rate debt or vice versa[189]