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Weak results for LyondellBasell Industries

Weak results for LyondellBasell Industries
LyondellBasell Industries announced a net loss for the fourth quarter 2011 of $218 million, or $0.38 per share.

For the full year 2011, net income was $2,140 million, or $3.74 per share. The fourth-quarter and full-year results include the impacts of $431 million included in interest expense related to the company's refinancings and $136 million of charges associated with the suspension of operations at the Berre refinery.

For 2011, LyondellBasell reported improved results across the majority of its portfolio, most notably in North American olefins and at the Houston refinery, both of which benefit from advantaged feedstocks.

The fourth quarter was negatively impacted by lower industry margins, particularly in refining, a year-end slowdown, charges primarily related to the suspension of operations at the Berre refinery and costs related to refinancing activities.

"The fourth quarter was a period of global economic slowdown and our results were impacted by broader trends," said Jim Gallogly, LyondellBasell Chief Executive Officer. "Customers responded to this slowdown by destocking inventory and delaying orders, which negatively impacted volumes in Europe and Asia and margins globally. Refining margins were particularly weak. Although overall results for the fourth quarter declined, we expect our strategy of focusing on the basics and running our assets safely and efficiently will continue to deliver value to our shareholders," Gallogly said.

"Despite a weak fourth quarter, 2011 was a strong year for LyondellBasell. Exclusive of a number of costs incurred to improve the company, including costs related to restructuring and refinancing our capital structure, full-year adjusted EBITDA was slightly over $5.4 billion and adjusted net income was over $2.7 billion, or $4.71 per adjusted diluted share. We returned $2.9 billion to shareholders through dividends. We also defined our plans for future growth, which we communicated at our December Investor Day. I am also extremely proud of all who work at our facilities as we achieved a record year in health, safety and environmental performance," Gallogly said.

Commenting on the near-term outlook, Gallogly said, "We expect overall first-quarter economic activity to remain slow in Europe and Asia for certain of our businesses. In recent weeks, we have seen indications that our market environment is improving in the U.S. Ethylene chain margins have increased from fourth-quarter lows as ethane prices have declined and co-products and polyolefin prices have increased. In refining, the benchmark Maya 2-1-1 crack spread has improved, benefiting our Houston refinery.

Importantly, certain underlying fundamentals that have supported our business remain intact. A low ratio of U.S. natural gas to crude oil prices creates a favorable condition for our U.S. operations. Our differentiated businesses such as our propylene oxide, polypropylene compounding, and our Saudi and certain Asian joint ventures remain on a solid path," added Gallogly.