LyondellBasell Revenue Slumps, but Profit Tops Views -- Update
24 October 2015 - 1:58AM
Dow Jones News
By Chelsey Dulaney
LyondellBasell Industries NV on Friday reported a
worse-than-expected 31% slide in revenue, as pricing for its
products remained under pressure.
Excluding an inventory adjustment, earnings easily topped Wall
Street expectations.
The Dutch chemicals-and-polymer producer, which emerged from
chapter 11 bankruptcy in 2010, provides compounds found in products
ranging from electronics to construction materials and biofuels.
Lyondell, with its U.S. headquarters in Houston, has benefited from
lower natural gas prices that have led to lower key raw material
costs--helping to offset diminished pricing power that has resulted
from cheaper oil.
In recent quarters, however, lower product prices have pressured
revenue. For the period ended Sept. 30, the price of ethylene fell
by 26 cents per pound compared with the prior year.
In a news release, Chief Executive Bob Patel said the ethylene
industry has become more balanced in the current quarter.
"Looking ahead to 2016, we continue to forecast stable industry
demand and operating rates and believe that the markets for our
products will tighten as we move into the spring," Mr. Patel
said.
In all, the company reported a profit of $1.19 billion, or $2.54
a share, down from $1.26 billion, or $2.45 a share, a year
earlier.
The quarter's results included a $181 million inventory
adjustment charge. Excluding that item, per-share earnings were
$2.80 a share.
Revenue fell to $8.33 billion from $12.07 billion in the
prior-year period.
Analysts, according to Thomson Reuters, expected earnings of
$2.57 a share and revenue of $9.05 billion.
Olefins and polyolefins in the Americas, the segment that
produces products such as ethylene and the represents the bulk of
the company's bottom line, reported operating income of $740
million, down from $1.07 billion a year earlier.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
October 23, 2015 10:43 ET (14:43 GMT)
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