LyondellBasell Industries N.V.

What they do

The company operates through four segments: Olefins and Polyolefins-Americas (O&P-Americas), Olefins and Polyolefins-Europe, Asia, International (O&P-EAI), Intermediates and Derivatives (I&D), and Advanced Polymer Solutions (APS). It produces base chemicals, plastics, fuels, and performance polymers sold globally. In February 2025, it ceased Houston refinery operations, reporting refining as discontinued operations. In Q2 2026, it completed the divestiture of select European olefins and polyolefins assets, with a pre-tax loss on sale of $734 million.

Revenue drivers

• Olefins and Polyolefins-Americas — Produces polyethylene and polypropylene; the largest segment, driven by polymer margins and North American feedstock advantages; operated at ~90% utilization in Q2 2026.
• Intermediates and Derivatives — Produces oxyfuels, styrene, acetyls, and other derivatives; margins pressured in 2025 by new octane capacity but improved in Q2 2026 with supply constraints.
• Olefins and Polyolefins-Europe, Asia, International — Produces polyolefins for European and international markets; 2025 margins declined due to import competition, but Q2 2026 benefited from supply chain disruptions.
• Advanced Polymer Solutions — Produces specialty polymers and compounds; delivered margin gains in 2025 through portfolio optimization and increased business win rates.

Recent performance

For Q2 2026, revenue was $9.18 billion (vs. $7.66 billion in Q2 2025) and net income was $559 million ($1.71 diluted EPS). Excluding identified items, EPS was $4.30 and EBITDA $2.1 billion. Full-year 2025 revenue fell 10% to $30.15 billion and net loss was $738 million, primarily from $1.25 billion in impairments in O&P-EAI and APS. Operating cash flow declined to $2.26 billion in 2025 from $3.82 billion in 2024. As of June 30, 2026, cash was $2.63 billion and total assets stood at $34.48 billion.

Strategy

Management is executing a 'Cash Improvement Plan' targeting fixed-cost reductions and lower capital expenditures, with Q2 2026 pre-tax costs of $31 million. The divestiture of select European olefins and polyolefins assets, completed in Q2 2026, structurally reduces the cost base and aligns the European footprint to strategy; the company expects a $700-900 million total loss, including a cash contribution of ~$300 million. It returned $2.0 billion to shareholders in 2025 via dividends and buybacks, continuing a history of increasing dividends. Management also prioritizes operating flexibility, raising utilization to ~90% in North America to capitalize on supply disruptions.

Risks

• Industry cyclicality and oversupply — New global capacity additions have outpaced demand growth, leading to oversupply and lower prices/margins across petrochemical segments.
• Crude oil price volatility — A sustained decline in crude oil relative to U.S. natural gas prices would erode the feedstock cost advantage for North American operations.
• European divestiture execution — The expected $700-900 million loss on the European asset sale includes a cash contribution of $300 million, and any closing delays could add costs.
• Trade disruptions and feedstock costs — Global trade disruptions and higher feedstock costs pressured polyethylene chain margins in 2025, which could recur if market conditions sour.

Outlook

For Q2 2026, management cited 'dynamic and supply-constrained market conditions' with improved margins across segments, driven by geopolitical instability. The company expects continued benefits from the European divestiture, which reduces its cost base and structural footprint. Management remains focused on disciplined capital allocation, cost reduction, and operating at high utilization rates to capture improved market conditions, while cautioning that industry oversupply and crude oil prices remain uncertain.