Materials supplier LyondellBasell posted lower sales and profit in 2024, as the firm dealt with declining margins and soft demand.
Full-year sales at Houston-based LYB were down 2 percent to $40.3 billion, as profit slid 35 percent to $1.37 billion. In a news release, officials said that, throughout 2024, petrochemical markets faced headwinds from soft global demand, rising raw material costs and economic uncertainty.
Markets “were broadly pressured” by weak demand for durable goods, which impacted margins in LYB’s Olefins & Polyolefins and Intermediates & Derivatives units, they said. Officials added that margin recovery in the company's Advanced Polymer Solutions unit was limited by global declines in automotive production.
In LYB’s sustainable portfolio, sales volumes for Circular & Low Carbon Solutions grew by 65 percent for the year. During the fourth quarter, officials said robust export demand for North American polyethylene resin offset seasonal volume moderation in domestic markets. Outside of North America, they said seasonally slower demand for olefins and polyolefins and downtime at LYB’s European assets impacted volumes and margins.
CEO Peter Vanacker said in the release that LYB “is successfully navigating difficult market conditions … during what has been the longest and deepest downturn of my career.”
“We are not wavering in the execution of our strategy,” he added. “We continue to grow and upgrade our core businesses with decisive portfolio management. The volumes of our sustainable products are rapidly growing and aligned with our profitability targets.”
Sales for 2024 at LYB’s olefins and polyolefins Americas unit grew 2 percent to $11.5 billion, with operating profit up 7 percent to $1.8 billion. The firm is a major supplier of polyethylene and polypropylene resins.
O&P Americas’ 2024 PE sales volume was up almost 1 percent to just under 6.9 billion pounds, while its PP sales volume was up 3 percent to almost 2.4 billion pounds.
LYB’s advanced polymer solutions unit, which includes North America’s largest compounding business, saw 2024 sales down 3 percent to $3.6 billion, with an operating loss of $48 million. That unit had posted an operating loss of $261 million for full-year 2023. Sales volume in 2024 for APS essentially was flat at just over 3.2 billion pounds.
Looking to 2025, officials said that LYB “remains watchful and prepared for macroeconomic catalysts that will eventually drive restocking of supply chains, improve demand for durable goods and support a more broad-based economic recovery.”
They added that one indicator of recovery is that North American domestic demand for PE and PP rebounded in 2024 after two years of declines. “Reductions in interest rates, moderation of inflation and pent-up demand should be supportive for increased consumption of durable goods,” officials said.
LYB is aligning first quarter operating rates with global demand and expects to operate Olefins & Polyolefins Americas assets at about 80 percent, with Olefins & Polyolefins EAI assets at about 75 percent.