Many major O&G companies have released their Q1 reports for 2024, detailing their financial performance and earnings for the beginning of the year.
Plastics and chemical refiner, LyondellBasell (LYB), reported a net income of $473 million or $1.44 per diluted share, with a focus on building a profitable Circular & Low Carbon Solutions (CLCS) business. During the quarter, the company recognized identified items of $28 million, net of tax. These items, which impacted Q1 earnings by $0.09 per share, were related to costs incurred from plans to exit the refining business.
Q1 2024 EBITDA was $1.0 billion or $1.1 billion excluding identified items. In the U.S., lower costs for natural gas-based feedstocks and energy benefited olefins and polyolefins margins while regional demand for polyethylene improved. The company's North American volumes were constrained by downtime in olefins, polyolefins, propylene oxide, oxyfuels and acetyls. Globally, tepid demand for durable goods continued to challenge volumes and margins for polypropylene and propylene oxide.
The company remains committed to its balanced and disciplined capital allocation strategy. LYB used $114 million of cash for operating activities, invested $483 million in capital expenditures for the businesses and returned $408 million to shareholders through dividends. The use of cash by operating activities during the quarter was due to a build in working capital driven by expected seasonality as well as higher volumes and prices in several businesses. LYB successfully issued $750 million of bonds to refinance its 2024 maturity at a lower interest rate. At the end of the quarter, the company held $2.3 billion in cash and short-term investments and $6.5 billion in available liquidity.
LYB is methodically building a profitable CLCS business as one of the key pillars of its three-pillar corporate strategy. Since 2019, sales volumes of the company's recycled and renewable-based polymers have grown at a compound annual growth rate of 55%. LYB produced and marketed over 120 thousand tons of recycled and renewable-based polymers in 2023.
"LyondellBasell remains focused on unlocking significant value through our strategy while managing challenging market conditions. Our team continues to grow our CLCS business, with LYB building capabilities across the value chain, from upstream plastic waste sourcing to providing recycled and renewable-based polymers that meet the increasing demand from our customers," said Peter Vanacker, LyondellBasell CEO.
Olin Corp. reported net income of $48.6 million or $0.40 per diluted share, with an adjusted EBITDA of $242.1 million, excluding depreciation and amortization expense of $129.7 million and restructuring charges of $8.3 million. Sales were $1,635.3 million.
Olin President and CEO Ken Lane said, "All first quarter 2024 business segment results improved sequentially from fourth quarter 2023, which begins Olin's recovery from trough-level earnings. During the quarter, the Olin team delivered on our commitment to accelerate a favorable inflection point for our Chlor Alkali Products and Vinyls business. We expect this momentum to continue with second quarter 2024 results, as demand and pricing continue to improve. We expect our chemical businesses to be sequentially higher than first quarter 2024 levels and our Winchester business to be in line with first quarter results, as a less favorable mix and higher raw material costs offset stronger military volumes. Overall, we anticipate Olin's second quarter 2024 adjusted EBITDA to improve from first quarter 2024 levels. Based on our current outlook for the pace of demand and pricing improvement for our chemical businesses, we currently believe Olin's full year 2024 adjusted EBITDA to be similar to or slightly higher than 2023 levels," he said.
Olin’s Chlor Alkali Products and Vinyls sales were $884.6 million. This was a decrease in sales primarily due to lower pricing and volumes. Q1 2024 segment earnings were $76.6 million, a decrease in segment earnings primarily due to lower pricing - primarily caustic soda - and lower volumes, partially offset by decreased costs associated with products purchased from other parties. Chlor Alkali Products and Vinyls results included depreciation and amortization expense of $106.8 million.
Epoxy sales were $341.3 million and included depreciation and amortization expense of $13.5 million. Winchester sales were $409.4 million, and earnings were $72.2 million. Q1 2024 results included depreciation and amortization expense of $7.9 million. The cash balance on March 31, 2024, was $150.9 million. Olin ended Q1 2024 with net debt of approximately $2.6 billion and a net debt to adjusted EBITDA ratio of 2.3 times. Net debt increased by $115.0 million, primarily due to typical seasonal working capital. The increase in working capital was $89.0 million.
On March 31, 2024, Olin had approximately $1.2 billion of available liquidity.
Approximately 2.0 million shares of common stock were repurchased at a cost of $105.4 million. On March 31, 2024, Olin had approximately $0.9 billion available under its share repurchase authorization.
Dow experienced a 9% decrease in net sales compared to the same period last year, with volume increasing by 1%, and returned $693 million in cash to shareholders.
“In the first quarter, Dow captured improving demand, maintained pricing and benefited from lower feedstock and energy costs,” said Dow Chair and CEO Jim Fitterling. “The strength of our cost-advantaged positions around the world led to higher operating rates. As a result, Team Dow delivered volume growth and margin expansion sequentially across our diverse portfolio. We also delivered on our capital allocation priorities," he said.
Dow’s net sales amounted to $10.8 billion, a 9% decrease compared to the same period last year, but a 1% increase sequentially, driven by growth in Performance Materials & Coatings and Industrial Intermediates & Infrastructure. Volume increased by 1% compared to the same period last year, with growth in all regions except Europe, the Middle East, Africa and India (EMEAI). Excluding Hydrocarbons & Energy, volume increased by 5% year-over-year and 1% sequentially, led by Performance Materials & Coatings. Local prices decreased by 10% year-over-year but remained flat sequentially, with gains in EMEAI offset by slight declines in Asia Pacific and the U.S. and Canada.
Equity earnings improved by $65 million compared to the same period last year, totaling $17 million, reflecting improvements in all principal joint ventures. GAAP net income was $538 million, while operating earnings before interest was $674 million, down by $34 million year-over-year due to lower prices but up by $115 million sequentially, driven by gains in Performance Materials & Coatings and Industrial Intermediates & Infrastructure. Cash provided by operating activities from continuing operations was $460 million, down by $71 million year-over-year and $1.2 billion compared to the prior quarter, primarily due to a seasonal increase in working capital as sales rose during the quarter.
Returns to shareholders totaled $693 million, including $493 million in dividends and $200 million in share repurchases.
ExxonMobil Corp. had earnings of $8.2 billion, or $2.06 per share assuming dilution. Capital and exploration expenditures were $5.8 billion, consistent with the company's full-year guidance of $23 billion to $25 billion.
Upstream first-quarter earnings were $5.7 billion, a decrease of $797 million compared to the same quarter last year. The prior-year period was negatively impacted by tax-related identified items. Excluding identified items, earnings decreased $955 million driven by a 32% decrease in natural gas realizations and other primarily non-cash impacts from tax and inventory adjustments as well as divestments. These factors were partially offset by a 4% increase in liquids realizations and less unfavorable timing effects mainly from derivatives mark-to-market impacts.
ExxonMobil generated a strong cash flow from operations of $14.7 billion and free cash flow of $10.1 billion in Q1. Shareholder distributions of $6.8 billion included $3.8 billion of dividends and $3.0 billion of share repurchases. The share-repurchase program was paused briefly following Pioneer Natural Resources’ S-4 filing and resumed after Pioneer's special shareholder meeting. In Q2 of 2024, ExxonMobil and Pioneer Natural Resources will close on an anticipated merger — a $59.5 billion all-stock transaction that was approved by Pioneer shareholders and is pending regulatory approval. The annual pace of share repurchases will increase to $20 billion per year after the transaction closes, assuming reasonable market conditions.
The company declared a second-quarter dividend of $0.95 per share, payable on June 10, 2024, to shareholders of record of Common Stock at the close of business on May 15, 2024.
ExxonMobil's debt-to-capital ratio was 16% and the net-debt-to-capital ratio was 3%, reflecting a period-end cash balance of $33.3 billion.
Also in its report, ExxonMobil achieved a quarterly gross production of over 600,000 oil-equivalent bpd in Guyana and made a final investment decision on the sixth major development. The company also saw growth in performance chemical sales volumes and achieved a record first-quarter refining throughput, maintaining excellent turnaround performance. ExxonMobil reduced its operated methane emissions intensity by more than 60% since 2016 and invested in technology to expand its reach into new high-value, high-growth markets, including advanced recycling, ProxximaTM, carbon materials and direct air capture of carbon dioxide.
“We delivered a strong quarter with continued growth in advantaged assets, such as Guyana, where production continues at higher-than-expected levels, contributing to historic economic growth for the Guyanese people. In Product Solutions, our strong turnaround performance on cost and schedule helped drive record first-quarter refining throughput1,” said Darren Woods, chairman and CEO. “Looking ahead, we’re making great progress on our plans to grow the earnings power of our existing businesses from investments in advantaged assets and higher-value products, and further reduce structural costs. We are investing in technology to transform the molecules derived from oil and natural gas into products that extend our reach into new, high-value, high-growth markets to capture even greater value from our core competitive advantages.”
Chevron's Q1 2024 earnings of $5.5 billion, or $2.97 per share - diluted, reflect a strong operational and financial performance, boosted by $85 million from foreign currency effects. The company's return on capital employed exceeded 12%, and it increased its dividend per share payout by 8% from Q4 2023 and repurchased nearly $3 billion of its shares.
Mike Wirth, Chevron’s chairman and CEO, highlighted strong operational and financial performance. “We had another quarter of strong operational and financial performance and delivered superior cash returns to shareholders. U.S. production increased by 35% from a year ago, and we continued to meet major project milestones,” he said.
Earnings and cash flow from operations for Q1 2024 decreased compared to last year, primarily due to lower margins on expanding the retail marketing network, asset retirements and refined product sales and natural gas realizations, despite higher upstream sales volumes in the U.S.
U.S. net oil-equivalent production rose mainly due to higher investments in upstream. This was driven by the acquisition of PDC Energy (PDC) and strong performance in the Permian and Denver-Julesburg Basins. Chevron's affiliate Tengizchevroil launched the Wellhead Pressure Management Project in April, and Chevron advanced its carbon capture, hydrogen and renewable fuels businesses during the quarter.
Worldwide production was 12% higher than a year ago, led by acquisitions and operational success in the U.S. and Kazakhstan, partly offset by planned downtime in Nigeria. Chevron returned $6 billion in cash to shareholders, marking an eighth straight quarter of over $5 billion in returns. Key project milestones were achieved in Kazakhstan, the East Mediterranean and the U.S.
Chevron’s Board of Directors declared a quarterly dividend of $1.63 per share, payable on June 10, 2024, to all holders of common stock as of the close of business on May 17, 2024.
These Q1 2024 company reports reflect both challenges and opportunities within the industry while showcasing the wide spectrum of financial performances and strategic initiatives.
