Oct 30, 2026 earnings call — Cash strength and refinery site sale
Company reported 18% EBITDA margins and $1.4 billion in free cash flow in Q3.
Revenue $8.5B (est $8.9B) · EPS $2.54 (est $2.57)
Key quotes
"We announced that LyondellBasell has entered into an agreement with Valero to sell the site and associated assets as part of our ongoing portfolio management efforts."
"Third quarter EBITDA more than doubled sequentially to a record level of $795 million."
"Our third quarter operating rate for the segment was approximately 85%, with our crackers operating at approximately 90% during the quarter."
Analyst Q&A 10
MTBE margin decline and Q4 volumes
Q (Kevin McCarthy · Vertical Research Partners): He asked why MTBE has been relatively strong recently and wanted color on what is driving the recent moves and the sequential outlook into Q4.
A: Management said margins were at record levels coming out of September but declined steadily through October driven by falling gas cracks and MTBE premiums and higher butane costs. They said Europe has been less impacted due to Rhine logistics, and seasonality is reducing some volumes in Q4.
"As we said in our planned remarks, margins were at record levels coming out of September, and we have seen a steady decline throughout October, and that's primarily driven by declining gas cracks and MTBE premiums coming off." — Aaron Ledet
Refinery sale and MoReTec-2 plans
Q (Salvator Tiano · KeyBanc): He asked whether selling the refinery means MoReTec-2 is delayed or canceled, and whether the sale affects supply chains or creates feedstock agreements with buyers like Valero.
A: Management said their circularity strategy is unchanged but they adapt plans based on regulation, customer demand and infrastructure. They said MoReTec-2 is assumed to be in Europe after MoReTec-1 and U.S. deployment depends on demand visibility and regulation; the refinery sale is viewed as a real estate and capital allocation decision, not a change in corporate strategy.
"We view this deal here primarily from a LyondellBasell point of view as a real estate and a capital allocation decision rather than a change in our corporate strategy." — Peter Z. Vanacker (CEO)
Ethane price and supply outlook
Q (Patrick Fischer · Goldman Sachs): He asked about the ethane supply-demand balance, what changed in the last six months, and whether ethane will stay above methane or move toward propane pricing.
A: Management said ethane rose about 14% from Q2 to Q3 due to stronger domestic demand, fewer turnarounds, higher operating rates, steady export flow and new Gulf Coast capacity starting up. They said ethane is about $0.30 a gallon (24% higher than Q3 average), margins may compress short-term, but new fractionators in Q4 should support incremental ethane supply and North America should remain advantaged.
"Today, ethane is sitting at about $0.30 a gallon, which is 24% higher than the third quarter average." — Kimberly Foley
Polyethylene pricing and inventory risk
Q (Patrick Cunningham · Citi): He asked why LYB is confident it can pass October/November polyethylene price increases and whether inventories are elevated or risk destocking into year-end.
A: Management said demand is extremely good, especially in cost-advantaged regions like North America, while Europe is softer and global inventories remain below pre-conflict levels. They added logistics are constrained, customers are holding very lean inventories, supply is challenged regionally, and prices will stay dynamic and responsive to feedstock costs, demand durability, supply chain constraints and inventories.
"Demand is strong in cost advantaged regions like North America, and it's obviously softening in high-cost regions like Europe." — Kimberly Foley
How export/trade flows will normalize
Q (Christopher Parkinson · Wolfe): He asked how export dynamics will normalize over time and where regional spreads may settle by H1 2027 and beyond.
A: Management said the dislocation will take quarters, not months, to unwind and that some capacities affected by the conflict will not come online immediately. They do not expect a sudden change at the turn of the year and said the market will take time to return toward prior conditions.
"Having said that, of course, in the meantime, there has been also capacities that have suffered, I mean, from the conflicts that not immediately are expected to come online as well." — Peter Z. Vanacker (CEO)
Use of cash and capital deployment
Q (John McNulty · BMO): He asked whether the company will loosen capital deployment given stronger liquidity and cash, or remain conservative given ongoing uncertainty.
A: Management said liquidity management and cash conversion are part of the company's DNA and they will remain disciplined and prudent. They noted a $900 million maturity in Q1 and typical Q1 working capital outflows, so nothing will change in their capital allocation strategy now.
"So we will continue to be very prudent and diligent and as you've heard also from the questions before, the uncertainty remains quite high, so nothing really will change in our capital allocation strategy." — Agustin Izquierdo (CFO)
Cracker and O&P operating rates
Q (Abigail Eberts · Wells Fargo): She asked what the company expects cracker and O&P rates to be in Q4 given ethane and ethylene pricing and current ~90% cracker runs.
A: Management said crackers are at about 90% and that across Olefins & Polyolefins they have guided to 85%. The company clarified this guidance applies in the Americas.
"On the crackers 90, across O&P, we've guided to 85%." — Kimberly Foley
Freight rates impact on exports
Q (Joshua Spector · UBS): He asked how much freight rates are passed to customers and whether freight is a cost to watch or an opportunity on spreads.
A: Management said most of LYB's exports are sold at the port and competitors generally do the same, so freight is typically handled at the port sale level. They noted some competitors pay higher backhaul rates from other regions and must include those costs in their prices.
"When you think about LYB's export, most of it is sold at the port, and I think most of our competitors are also doing the same." — Kimberly Foley
APS and automotive demand in China
Q (Vincent Andrews · Morgan Stanley): He asked whether China's auto import quotas and changing trade flows affect LYB's APS and polypropylene exposure to autos.
A: Management said automotive is important for APS and they have a global footprint including China, but overall softness in automotive demand and durable goods has been a headwind. They said APS is improving profitability through customer focus, asset optimization and innovation, and EVs are positive because they require more complex formulations and more plastics content per vehicle.
"I would say, rather that the overall softness in automotive demand and durable goods have been a headwind for us." — Torkel Rhenman
China polyethylene imports and cash use
Q (Jeffrey Zekauskas · JPMorgan): He asked if China will return to ~1 million tons/month polyethylene imports in 2027 and whether the Board prefers dividends or buybacks with excess cash.
A: Management said China import levels in 2026 are volatile and capacity coming online in 2027–2028 suggests a planning range of 750 to 1 million tons, with supply-demand and plastics growth being the key factors. On capital use, they said their actions to improve earnings and cash generation remain, capital allocation philosophy is unchanged, and priorities include investment grade, reducing leverage, maintenance, dividend growth and eventual buybacks to offset dilution.
"Investment grade, very important, making sure net leverage comes down, maintenance on our assets to run them safe and reliably, dividend growth and eventually buybacks to offset dilution and that will be our philosophy." — Agustin Izquierdo (CFO)