Westlake Chemical Partners LP Announces Fourth Quarter and Full Year 2024 Results

Declared quarterly distribution of $0.4714 per unit; 42^nd consecutive quarterly distribution

Westlake Chemical Partners LP (the “Partnership”) reported net income attributable to the Partnership in the fourth quarter of 2024 of $15.0 million, or $0.43 per limited partner unit, which was relatively in line with fourth quarter 2023 net income of $14.3 million. Cash flows from operating activities in the fourth quarter of 2024 were $132.5 million, an increase of $24.8 million compared to fourth quarter 2023 cash flows from operating activities of $107.7 million, due to higher net income and more favorable working capital changes. For the three months ended December 31, 2024, MLP distributable cash flow was $15.0 million, a decrease of $1.4 million compared to fourth quarter 2023 MLP distributable cash flow of $16.4 million. The decrease in MLP distributable cash flow was primarily due to higher turnaround reserve contributions and maintenance capital contributions to support the planned Petro 1 turnaround.

Fourth quarter 2024 net income attributable to the Partnership of $15.0 million decreased by $3.1 million compared to third quarter 2024 net income of $18.1 million, primarily due to the impact of excess quantities on OpCo’s ethylene sales price to Westlake in the fourth quarter of 2024, which was related to the decision to push the Petro 1 turnaround to 2025. The excess quantities impact on fourth quarter 2024 sales price, in and of itself, had no effect on full year 2024 net income, MLP distributable cash flow or coverage ratio. Fourth quarter 2024 cash flows from operating activities of $132.5 million increased by $6.4 million compared to third quarter 2024 cash flows from operating activities of $126.1 million primarily due to more favorable working capital changes. Fourth quarter 2024 MLP distributable cash flow of $15.0 million decreased by $2.9 million compared to third quarter 2024 MLP distributable cash flow of $17.9 million, primarily due to lower OpCo net income.

For the full year 2024, net income attributable to the Partnership of $62.4 million, or $1.77 per limited partner unit, increased by $8.1 million compared to full year 2023 net income attributable to the Partnership of $54.3 million. The increase in net income attributable to the Partnership was primarily due to higher third-party ethylene sales prices and margins. Cash flows from operating activities for the full year 2024 were $485.0 million, an increase of $33.0 million compared to the full year 2023 cash flows from operating activities of $452.0 million. This increase in cash flows from operating activities was primarily due to higher net income. For the year ended December 31, 2024, MLP distributable cash flow was $66.9 million, an increase of $4.3 million compared to MLP distributable cash flow of $62.6 million for the year ended December 31, 2023.

“The Partnership performed well in 2024 as we exceeded our annual production plan, in part due to the decision to defer the planned turnaround at our Petro 1 ethylene unit to 2025. By postponing the Petro 1 turnaround we were able to better capture attractive third-party ethylene prices and margins in the second half of 2024, which supported an improvement in the Partnership’s distributable cash flow and coverage ratio for the full year 2024,” said Jean-Marc Gilson, President and Chief Executive Officer. “At the end of January 2025, we began our planned maintenance turnaround at our Petro 1 ethylene unit, which is expected to last approximately 60 days. As is typically the case during turnaround years, the lost production during the Petro 1 turnaround may cause the Partnership’s coverage ratio to dip below 1.00x this year. As has been the case in previous turnaround years when the Partnership’s coverage ratio dipped below 1.00x, we estimate that the Partnership will have ample cash and operating surplus to fund distributions in excess of distributable cash flow in 2025. Looking beyond 2025, we believe recent improvement in third-party ethylene prices and margins should position the Partnership for improved cash flows once production returns to expected levels.”

On January 27, 2025, the Partnership announced that the Board of Directors of Westlake Chemical Partners GP LLC had approved a quarterly distribution for the fourth quarter of 2024 of $0.4714 per unit to be payable on February 25, 2025 to unitholders of record as of February 7, 2025, representing the 42nd consecutive quarterly distribution to the Partnership’s unitholders. MLP distributable cash flow provided trailing twelve-month coverage of 1.01x the declared distributions for the fourth quarter of 2024, which was a decrease from the trailing twelve-month coverage ratio of 1.03x at the end of the third quarter of 2024.

OpCo’s Ethylene Sales Agreement with Westlake is designed to provide for stable and predictable cash flows. The agreement provides that 95% of OpCo’s ethylene production is sold to Westlake for a cash margin of $0.10 per pound, net of operating costs, maintenance capital expenditures and reserves for future turnaround expenditures.

The statements in this release and the related teleconference relating to matters that are not historical facts, such as those with respect to the timing and results of our turnaround activities, including the Petro 1 turnaround, our future coverage ratio, our ability to fund distributions in excess of distributable cash flow, our outlook for third-party ethylene margins, our expectations regarding future interest rates, the ability to deliver value and returns to unitholders, our outlook for improved cash flows, and the nature of the sales agreement with Westlake, are forward-looking statements. These forward-looking statements are subject to significant risks and uncertainties. Actual results could differ materially, based on factors including, but not limited to, pandemic infectious diseases and the response thereto; operating difficulties; the volume of ethylene that we are able to sell; the price at which we are able to sell ethylene; changes in the price and availability of feedstocks; changes in prevailing economic conditions; actions and commitments of Westlake Corporation; actions of third parties; inclement or hazardous weather conditions, including flooding, and the physical impacts of climate change; environmental hazards; changes in laws and regulations (or the interpretation thereof); inability to acquire or maintain necessary permits; inability to obtain necessary production equipment or replacement parts; technical difficulties or failures; labor disputes; difficulty collecting receivables; inability of our customers to take delivery; fires, explosions or other industrial accidents; our ability to borrow funds and access capital markets; and other risk factors. For more detailed information about the factors that could cause actual results to differ materially, please refer to the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC in February 2024, and Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, which was filed with the SEC in November 2024.

This release is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Brokers and nominees should treat one hundred percent (100.0%) of the Partnership’s distributions to non-U.S. investors as being attributable to income that is effectively connected with a United States trade or business. Accordingly, the Partnership’s distributions to non-U.S. investors are subject to federal income tax withholding at the highest applicable effective tax rate.

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About Westlake

Westlake is a global manufacturer and supplier of materials and innovative products that enhance life every day. Headquartered in Houston, we provide the building blocks for vital solutions — from building products and infrastructure materials, to packaging and healthcare products, to automotive and consumer goods. For more information, visit the company’s website at www.westlake.com.

Contact:

Ben Ederington – Media Contact – mediarelations@westlake.com – (713) 960-9111

Source: Westlake Chemical Corporation