LyondellBasell Industries Earnings: Revenues are Down 15%, But Our Stock is Up 4.5%

LyondellBasell Industries N.V. (NYSE:LYB) reported its results for the second quarter. Lyondellbasell Industries is an independent chemical company. It is a producer of polypropylene and polypropylene compounds (PP compounds) and a producer of propylene oxide (PO), polyethylene (PE), ethylene, and propylene.

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LyondellBasell Industries N.V. Earnings Cheat Sheet

Results: Net income for LyondellBasell Industries N.V. fell to $768 million ($1.33 per share) vs. $803 million ($1.38 per share) a year earlier. This is a decline of 4.4% from the year-earlier quarter.

Revenue: Fell 15.5% to $11.25 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: LyondellBasell Industries N.V. reported adjusted net income of $1.66 per share. By that measure, the company beat the mean estimate of $1.41 per share.

Quoting Management: “During the second quarter, we continued to demonstrate the earnings power of our company as margins strengthened over the first quarter,” said Jim Gallogly, LyondellBasell Chief Executive Officer. “While global economic uncertainties dominate the headlines, our company’s performance has remained strong. NGL supply and costs continue to drive favorable U.S. olefin results particularly in the Midwest where ethane prices declined to below equivalent fuel values,” he stated. “The Olefins and Polyolefins-EAI segment benefited from improved European olefin margins and joint venture dividend payments despite weak European economic conditions, which led to lower volumes. The Intermediate and Derivatives, and Technology segments continue to demonstrate strong, steady performance. The Houston refinery operated near full capacity; however, low by-product values impacted refining results,” Gallogly said.

Key Stats:

The company has beaten estiamtes for two quarters in a row. In the first quarter, it topped expectations with net income of $1.08 versus a mean estimate of net income of $1.04 per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the third quarter has moved down from $1.36 a share to $1.33 over the last sixty days. For the fiscal year, the average estimate has moved down from $4.94 a share to $4.76 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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