LyondellBasell Industries

Hello, and welcome to the Lionel Bissell teleconference. At the request of Lionel Bissell, this conference is being recorded for instant replay purposes. Following today's presentation, we will conduct a question and answer session. I would now like to turn the conference over to Mr. David Kinney, Head of Investor Relations. Sir, you may begin.

Thank you, Operator. Before we begin the discussion, I would like to point out that a slide presentation accompanies today's call and is available on our website at www.LyondellBassell.com slash investor relations. Today, we will be discussing our business results while making reference to some forward-looking statements and non-GAAP financial measures. We believe the forward-looking statements are based upon reasonable assumptions and the alternative measures are useful to investors. Nonetheless, the forward-looking statements are subject to significant risk and uncertainty. We encourage you to learn more about the factors that can lead our actual results to differ by reviewing the cautionary statements in the presentation slides and our regulatory filings, which are also available on our investor relations website. Comments made on this call will be in regard to our underlying business results using non-GAAP financial measures such as EBITDA and earnings per share excluding identified items. Additional documents on our investor website provide reconciliations of the non-GAAP financial measures to GAAP financial measures, together with other disclosures, including the earnings release and our business results discussion. A recording of this call will be available by telephone beginning at 1 p.m. Eastern time today until March 3rd by calling 877-660-6853 in the United States and 201-612-7415 outside the United States. The access code for both numbers is 137-342-90. Joining today's call will be Peter Banneker, Lyon Delta Cells Chief Executive Officer, our CFO, Michael McMurray, Ken Lane, our Executive Vice President of Global Olefins and Polyolefins, Kim Foley, our EVP of Intermediates and Derivatives in Refining, and Torkel Renman, our EVP of Advanced Polymer Solutions. During today's call, we will focus on fourth quarter and full year 2022 results, current market dynamics, and our near-term outlook. With that being said, I would now like to turn the call over to Peter.

Thank you, David, and welcome to all of you. We appreciate you joining us today as we discuss our fourth quarter and full year 2022 results. Let's begin with our safety results on slide number three. Reiner Basel's employees and contractors delivered an outstanding safety performance during 2022. Injury rates at our company have consistently been among the lowest for our industry. But last year, we reduced the rate of injuries across our global workforce by roughly 1.5 to 0.12 injuries per 200,000 hours worked. At our Bayport complex outside of Houston, our team finished 2022 with over 6 million consecutive safe work hours, a new company record. Simply put, a consistent focus on safe work is embedded in our company's DNA and provides a solid foundation for extending that shared focus across other dimensions of the company's culture. Let's now turn to slide number four to discuss our financial results. 2022 was a very challenging year characterized by a war in Ukraine, evolving responses to the COVID pandemic, energy volatility, inflation, and rapidly changing monetary policies. At Lionel Basel, our portfolio of businesses continued to provide value for our global customers with products and solutions that are essential for modern society. In 2022, Linder Basel delivered earnings of $12.46 per share with EBITDA of $6.5 billion. Cash generation was exceptional and resulted in $6.1 billion of cash from operations, second only to our 2021 results. We ended the year with $6 billion of liquidity supported by a strong investment grade balance sheet. Return on invested capital was 16%, far exceeding our cost of capital. In addition to our focus on safety, we're sharpening our strategic focus to maximize value for our customers, shareholders, and society under a range of scenarios. On slide number five, we outline our progress on delivering value from this strategy over the past year. Our leadership in cost management and operational excellence enabled Linder Basel to hold fixed costs well below inflation and quickly adjust operating rates in response to evolving market conditions. Our diverse global business portfolio provided outstanding cash generation during a challenging year. And at the same time, we positioned the portfolio for changing times with decisions to exit refining and sell our Australian polypropylene business. We established a new business unit focused on establishing leadership in providing circular and low-carbon solutions for our customers. And we are advancing our supply chains, production capacity, and sustainable assets to serve rapidly growing markets for these circular and low-carbon products. Last quarter, we announced our increased focus on capturing value as we continue to manage costs. We expect our value enhancement program will generate at least $750 million in recurring annual EBITDA by the end of 2025. Our increased focus helped drive a 13% point improvement in cash conversion in 2022. that further bolstered our capital structure and supported generous shareholder returns. On slide number six, I would like to highlight our recent decisions to accelerate progress on our climate targets and create more value by doing so. In order to meet the goals of the Paris Climate Agreement, climate scientists believe that global warming should be limited to no more than 1.5 degrees Celsius above pre-industrial levels. In December, we announced our decision to increase Lionel Bazel's 2030 targets for reducing Scope 1 and Scope 2 emissions to 42% and established a new Scope 3 emission reduction target of 30% relative to 2020 levels. Our targets are now aligned with the science-based guidance and the 1.5 degrees Celsius scenario. In addition, as we continue to make progress in sourcing favorably priced renewable electricity, we have increased our 2030 goal to procure at least 75% of our global power generation needs from renewable and low-carbon sources. Earlier this week, we announced our first two renewable power purchase agreements in Europe and two additional agreements in the United States, all together We now have eight agreements in place for 930 megawatts of renewable power capacity, which represents roughly one-third of our global needs. These agreements will prevent nearly 1 million tons of annual greenhouse gas emissions. All of this work supports our goal to become net zero in scope one and scope two emissions by 2050. At the same time, we continued to build global businesses that will sell at least 2 million tons of recycled and renewable-based polymers by 2030. On slide number seven, let's take a look at how we are building our circle and brands of recycled and renewable-based polymers. During the fourth quarter, we announced progress in developing four new plastic waste sorting and recycling facilities in Houston, Germany, India, and China. These facilities provide a strong foundation for a robust global supply chain for plastic waste feedstocks. And with our three product platforms, Circle and Recover for mechanical recycling, Circle and Revive for advanced recycling, and Circle and Renew for renewable-based feedstocks, Linder Basel will be able to match both feedstocks and products with the highest value solutions for all customers. The combination of our focus, scale, technologies, and global platforms provides Lionel Basel with powerful advantages to build a world-leading circular and low-carbon solutions business. Now, with that, I will turn the call over to Michael first, and then to each of our business leaders who will describe our financial and segment results in more detail.