Net profit up to $1.4 billion! LyondellBasell releases Q2 2026 financial results

I. Core financial data impressive; divestment of European assets optimizes cost structure

On July 31, global petrochemical giant LyondellBasell (LYB) released its operating results for the second quarter of 2026. Benefiting from the contraction in global petrochemical supply and widening product price spreads, the company achieved significant profit growth during the period.

The financial report shows that the company's net income for the second quarter was $559 million, with diluted earnings per share of $1.71; after excluding one-time special adjustments such as asset disposals and impairments, net income reached $1.4 billion, or $4.30 per share. Quarterly EBITDA was $1.3 billion, increasing to $2.1 billion after excluding special items. Cumulative revenue for the first half of the year was $16.374 billion, with profitability levels showing significant restoration compared to the same period in 2025.

This quarter, the company completed the divestment of four European production assets. As a core move in portfolio optimization, this transaction effectively streamlined inefficient capacity in Europe, optimized the overall cost curve from the ground up, and enhanced the company's resilience against cyclical risks. Meanwhile, the company continues to implement cash optimization plans, aiming to achieve the goal of generating $500 million in additional cash flow by the end of 2026 by reducing fixed expenses and lowering capital expenditures.

II. Geopolitical disruptions cause global supply shortage; profitability improves across all segments

In the second quarter, ongoing geopolitical conflicts in the Middle East continued to escalate, obstructing the global petrochemical supply chain. The tight supply of all chemical categories brought profit dividends to the company's various business segments.

The Americas Olefins and Polyolefins segment, relying on low-cost raw material bases, maintained a plant operating rate of 90%. Spreads for polymers and co-products continued to widen, leading to a significant quarter-on-quarter recovery in performance. Olefins businesses in Europe and Asia also benefited from overseas supply gaps, with product margins recovering simultaneously.

Profitability in the Intermediates and Derivatives segment grew alongside the rising market trends for methanol, propylene oxide, and oxygenated fuels. Only the temporary shutdown of the Bayport Propylene Oxide/TBA facility briefly dragged down performance. This facility was restarted in June and is operating at full capacity, which is expected to drive product shipments in the second half of the year.

In terms of cash flow, operating cash flow for the second quarter was $752 million, and the divestment of European assets brought in $310 million in cash proceeds; capital expenditure for the period was $270 million, and dividends paid were $224 million, reflecting a balanced and robust capital allocation. As of the end of the quarter, the company held $2.6 billion in cash, with total available liquidity of $7.1 billion, indicating sufficient capital reserves.

III. Q3 operating plan released; uncertainty remains regarding Middle East geopolitical risks

The company holds a cautious outlook on the market, noting that supply disruptions caused by the Middle East conflict may extend into 2027. Price volatility in the energy and petrochemical chains will persist long-term, downstream procurement rhythms may be disrupted by short-term market fluctuations, but there is no significant risk of a sharp decline in terminal demand for now.

Combining equipment maintenance with market demand, the company released operating guidance for the third quarter: North America Olefins and Polyolefins operating rate at 85%, Europe Olefins and Polyolefins at 70%, and Intermediates and Derivatives segment at 85%. The Clinton site plans a shutdown for maintenance in the second half of the year, which will phase-wise reduce polyolefin output.

IV. Long-term business strategy unchanged; focusing on prudent operations and shareholder returns

LyondellBasell CEO Peter Vanacker stated that facing a complex macroeconomic environment, the company has fully leveraged this industry upcycle through its flexible global capacity layout and refined sales strategies. The two major measures of divesting European assets and reducing costs through cash optimization continue to lower the company's overall operating costs and strengthen its cash flow generation capabilities.

Subsequently, the company's capital allocation priorities remain stable: prioritizing the safe and stable operation of plants, repaying bonds due in September on schedule to continuously reduce leverage, maintaining stable shareholder dividends, and selectively deploying into high-quality chemical projects with long-term value-added potential to continuously create sustainable returns for shareholders.