NEWS RELEASE
FOR IMMEDIATE RELEASE
HOUSTON and LONDON, January 28, 2022
LyondellBasell Reports 2021 Earnings
Full Year 2021 Highlights
Earnings
•Robust demand and tight markets led to record margins
•Net Income: $5.6 billion, $6.1 billion excluding LCM and impairment(a)
•Diluted earnings per share: $16.75 per share, $18.19 per share excluding LCM and impairment
•EBITDA: $8.7 billion, $9.3 billion excluding LCM and impairment, an annual record
•Record cash from operating activities of $7.6 billion with record $5.7 billion free cash flow
Disciplined Capital Allocation
•Strengthened our balance sheet with long-term debt reduction of $4 billion
•Returned approximately $2 billion to shareholders:
◦Paid $4.44 per share in dividends, our eleventh consecutive year of annual dividend growth
◦Repurchased 5.2 million shares totaling $0.5 billion
Circularity and Climate Commitments
•Launched our Circulen portfolio of polymers that provide circular and sustainable solutions
•Accelerated our climate goals: 30% CO2 reduction by 2030 and net zero by 2050 (scope 1 and 2)
Fourth Quarter 2021 Highlights
•Net Income: $0.7 billion, $1.2 billion excluding LCM and impairment
•Diluted earnings per share: $2.18 per share, $3.63 per share excluding LCM and impairment
•EBITDA: $1.4 billion, $2 billion excluding LCM and impairment
•Strong cash flow supported long-term debt reduction of $1.7 billion
•Returned $0.8 billion to shareholders through dividends and the repurchase of 4.2 million shares
Comparisons with the prior quarter, fourth quarter 2020 and year ended 2020 are available in the following table:
Table 1 - Earnings Summary | | | | | | | | | | | | | | | | | |
| Millions of U.S. dollars (except share data) | Three Months Ended | Year Ended |
| December 31, 2021 | September 30, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 |
| Sales and other operating revenues | $12,830 | $12,700 | $7,937 | $46,173 | $27,753 |
| Net income | 726 | 1,762 | 855 | 5,617 | 1,427 |
| Diluted earnings per share | 2.18 | 5.25 | 2.55 | 16.75 | 4.24 |
| Weighted average diluted share count | 332 | 334 | 334 | 334 | 334 |
EBITDA (a) | 1,395 | 2,691 | 1,413 | 8,689 | 3,285 |
Excluding LCM and Impairment (a) | | | | | | | | | | | | | | | | | |
| Net income | $1,207 | $1,762 | $736 | $6,098 | $1,884 |
| Diluted earnings per share | 3.63 | 5.25 | 2.19 | 18.19 | 5.61 |
| LCM (benefits) charges, pre-tax | — | — | (147) | — | 16 |
| Impairment, pre-tax | 624 | — | — | 624 | 582 |
| EBITDA | 2,019 | 2,691 | 1,266 | 9,313 | 3,883 |
(a) See “Information Related to Financial Measures” for a discussion of the Company’s use of EBITDA and EBITDA excluding LCM and Impairment and Table 2 for reconciliations of net income to those measures. LCM stands for “lower of cost or market.” Impairment is related to charges incurred in the Refining segment.
LyondellBasell Industries (NYSE: LYB) today announced net income for the fourth quarter 2021 of $0.7 billion, or $2.18 per share. The company recognized a $624 million non-cash impairment charge during the quarter related to the Houston refinery. The impairment reduced net income by $481 million or $1.45 per share. Fourth quarter 2021 EBITDA was $1.4 billion, or $2.0 billion excluding LCM and impairment. Debt extinguishment costs reduced fourth quarter net income by $53 million or $0.16 per share.
Full year 2021 net income was $5.6 billion, or $16.75 per share. Impairment charges related to the refinery reduced full year 2021 net income by $481 million, or $1.44 per share. Full year 2021 EBITDA was $8.7 billion, or $9.3 billion excluding LCM and impairment. Debt extinguishment costs reduced full year net income by $102 million or $0.30 per share.
“LyondellBasell achieved record profitability in 2021 supported by robust demand, tight markets and the company's recent growth investments. Our Olefins & Polyolefins Americas and Technology segments both posted record annual EBITDA. Profit margins reached all-time highs across many of LyondellBasell's businesses despite global supply chain disruptions and the spread of new COVID variants,” said Ken Lane, LyondellBasell Interim CEO.
“During the fourth quarter, higher costs for energy and feedstocks compressed margins, particularly in Europe. Strong demand drove LyondellBasell's U.S. ethylene cracker operating rates to 97 percent while planned maintenance constrained production at two of our European crackers. The resumption of our acetic acid production increased volumes in our Intermediates & Derivatives segment and offset weaker Oxyfuels margins. Improving demand for transportation fuels drove higher margins which enabled our Refining segment to post its second consecutive quarter of positive results.”
“LyondellBasell's substantial cash generation allowed the company to complete our goal of reducing long-term debt by $4 billion during 2021. We do not plan to pursue further debt reduction in 2022. At the same time, we repurchased 5.2 million shares and increased our annual dividend for the eleventh consecutive year. We are continuing to pursue a highly disciplined capital allocation strategy that aims to provide significant returns for shareholders.”
“In addition to our financial performance, LyondellBasell remains focused on substantive and ambitious goals to help address the opportunities from circularity and the challenges of climate change. During 2021, we stepped up our circularity and climate commitments with the launch of our Circulen portfolio of products and by accelerating the cadence of our carbon reduction plans with the establishment of a 2050 net zero target,” Lane said.
OUTLOOK
“With forecasts for above-average GDP growth in 2022, we expect continued strength in demand for our products. Supply chain disruptions and virus surges have been restraining pent-up consumer demand across the global economy. As vaccinations facilitate a more sustainable global reopening and supply chains normalize, LyondellBasell's businesses should benefit from increased demand for both goods and services. We are closely monitoring rising feedstock and energy costs, particularly at our European operations. Elevated levels of ethylene industry maintenance activities scheduled for the first half of 2022 are likely to constrain supply. We expect tight markets for acetyls and propylene oxide will continue to drive strong profitability within our I&D segment. In January, our Advanced Polymers Solutions segment benefited from increased order volumes for our products used in automotive production.”
“LyondellBasell's earnings and cash flows are stepping up from levels seen over the last decade. We are expanding our production with the commissioning of new facilities in China and the U.S. during 2022. We announced that we are accelerating our commitments to help address climate change. With our new CEO Peter Vanacker joining the company at the end of the second quarter, LyondellBasell is well poised to continue delivering on our track record of substantial cash generation and strong returns for shareholders,” said Lane.
CONFERENCE CALL
LyondellBasell will host a conference call January 28 at 11 a.m. EST. Participants on the call will include Interim Chief Executive Officer and Executive Vice President Ken Lane, Executive Vice President and Chief Financial Officer Michael McMurray and Head of Investor Relations David Kinney. For event access, the toll-free dial-in number is 1-877-407-8029, international dial-in number is 201-689-8029 or click the CallMe link. The slides and webcast that accompany the call will be available at www.LyondellBasell.com/earnings. A replay of the call will be available from 1:00 p.m. EST January 28 until February 28. The replay toll-free dial-in numbers are 1-877-660-6853 and 201-612-7415. The access ID for each is 13725132.
ABOUT LYONDELLBASELL
LyondellBasell (NYSE: LYB) is one of the largest plastics, chemicals and refining companies in the world. Driven by its employees around the globe, LyondellBasell produces materials and products that are key to advancing solutions to modern challenges like enhancing food safety through lightweight and flexible packaging, protecting the purity of water supplies through stronger and more versatile pipes, improving the safety, comfort and fuel efficiency of many of the cars and trucks on the road, and ensuring the safe and effective functionality in electronics and appliances. LyondellBasell sells products into more than 100 countries and is the world's largest producer of polypropylene compounds and the largest licensor of polyolefin technologies. In 2021, LyondellBasell was named to Fortune magazine's list of the “World's Most Admired Companies” for the fourth consecutive year. More information about LyondellBasell can be found at www.LyondellBasell.com.
FORWARD-LOOKING STATEMENTS
The statements in this release relating to matters that are not historical facts are forward-looking statements. These forward-looking statements are based upon assumptions of management of LyondellBasell which are believed to be reasonable at the time made and are subject to significant risks and uncertainties. When used in this presentation, the words “estimate,” “believe,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “should,” “will,” “expect,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Actual results could differ materially based on factors including, but not limited to, market conditions, the business cyclicality of the chemical, polymers and refining industries; the availability, cost and price volatility of raw materials and utilities, particularly the cost of oil, natural gas, and associated natural gas liquids; uncertainties and impacts related to the extent and duration of the pandemic; competitive product and pricing pressures; labor conditions; our ability to attract and retain key personnel; operating interruptions (including leaks, explosions, fires, weather-related incidents, mechanical failure, unscheduled downtime, supplier disruptions, labor shortages, strikes, work stoppages or other labor difficulties, transportation interruptions, spills and releases and other environmental risks); the supply/demand balances for our and our joint ventures’ products, and the related effects of industry production capacities and operating rates; our ability to manage costs; future financial and operating results; benefits and synergies of any proposed transactions; our ability to identify, evaluate and complete any strategic alternative related to the refinery; legal and environmental proceedings; tax rulings, consequences or proceedings; technological developments, and our
ability to develop new products and process technologies; our ability to meet our sustainability goals, including the ability to operate safely, increase production of recycled and renewable-based polymers, and reduce our emissions and achieve net zero emissions by the time set in our respective goals; our ability to procure energy from renewable sources; potential governmental regulatory actions; political unrest and terrorist acts; risks and uncertainties posed by international operations, including foreign currency fluctuations; and our ability to comply with debt covenants and to amend, extend, repay, redeem, service, and reduce our debt. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the “Risk Factors” section of our Form 10-K for the year ended December 31, 2020, which can be found at www.LyondellBasell.com on the Investor Relations page and on the Securities and Exchange Commission’s website at www.sec.gov. There is no assurance that any of the actions, events or results of the forward-looking statements will occur, or if any of them do, what impact they will have on our results of operations or financial condition. Forward-looking statements speak only as of the date they were made and are based on the estimates and opinions of management of LyondellBasell at the time the statements are made. LyondellBasell does not assume any obligation to update forward-looking statements should circumstances or management’s estimates or opinions change, except as required by law.
INFORMATION RELATED TO FINANCIAL MEASURES
This release makes reference to certain non-GAAP financial measures as defined in Regulation G of the U.S. Securities Exchange Act of 1934, as amended.
We report our financial results in accordance with U.S. generally accepted accounting principles, but believe that certain non-GAAP financial measures, such as EBITDA, net income and diluted EPS exclusive of adjustment for “lower of cost or market” (“LCM”) and impairment provide useful supplemental information to investors regarding the underlying business trends and performance of the company's ongoing operations and are useful for period-over-period comparisons of such operations. Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the financial measures prepared in accordance with GAAP.
We calculate EBITDA as income from continuing operations plus interest expense (net), provision for (benefit from) income taxes, and depreciation and amortization. EBITDA should not be considered an alternative to profit or operating profit for any period as an indicator of our performance, or as an alternative to operating cash flows as a measure of our liquidity. We also present EBITDA, net income and diluted EPS exclusive of adjustments for LCM and impairment. LCM is an accounting rule consistent with GAAP related to the valuation of inventory. Our inventories are stated at the lower of cost or market. Cost is determined using the last-in, first-out (LIFO) inventory valuation methodology, which means that the most recently incurred costs are charged to cost of sales and inventories are valued at the earliest acquisition costs. Fluctuation in the prices of crude oil, natural gas and correlated products from period to period may result in the recognition of charges to adjust the value of inventory to the lower of cost or market in periods of falling prices and the reversal of those charges in subsequent interim periods as market prices recover. Property, plant and equipment are recorded at historical costs. If it is determined that an asset or asset group’s undiscounted future cash flows will not be sufficient to recover the carrying amount, an impairment charge is recognized to write the asset down to its estimated fair value.
Free cash flow is a measure of profitability commonly used by investors to evaluate performance and may not be comparable to similarly titled measures reported by other companies due to differences in the way the measure is calculated. For the purposes of this release, free cash flow means net cash provided by operating activities minus capital expenditures.
These measures as presented herein, may not be comparable to similarly titled measures reported by other companies due to differences in the way the measures are calculated. This release contains time sensitive information that is accurate only as of the time hereof. Information contained in this release is unaudited and subject to change. LyondellBasell undertakes no obligation to update the information presented herein except to the extent required by law.
Additional operating and financial information may be found on our website at www.LyondellBasell.com/investorrelations. These measures as presented herein, may not be comparable to similarly titled measures reported by other companies due to differences in the way the measures are calculated.
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Source: LyondellBasell Industries
Media Contact: Kimberly Windon +1 713-309-7575
Investor Contact: David Kinney +1 713-309-7141
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| Table 2 - Reconciliation of Net Income to EBITDA, including and excluding LCM and Impairment |
| Three Months Ended | | | Year Ended |
| (Millions of U.S. dollars) | December 31,
2021 | | September 30,
2021 | | December 31,
2020 | | | December 31,
2021 | | December 31,
2020 |
| Net income | $ | 726 | | | $ | 1,762 | | | $ | 855 | | | | $ | 5,617 | | | $ | 1,427 | |
| add: LCM charges (benefits), after-tax | — | | | — | | | (119) | | | | — | | | 11 | |
| add: Impairments, after-tax | 481 | | | — | | | — | | | | 481 | | | 446 | |
| Net income excluding LCM and impairment | 1,207 | | | 1,762 | | | 736 | | | | 6,098 | | | 1,884 | |
| less: LCM (charges) benefits, after-tax | — | | | — | | | 119 | | | | — | | | (11) | |
| less: Impairments, after-tax | (481) | | | — | | | — | | | | (481) | | | (446) | |
| Net income | 726 | | | 1,762 | | | 855 | | | | 5,617 | | | 1,427 | |
| Loss (income) from discontinued operations, net of tax | 5 | | | 1 | | | 2 | | | | 6 | | | 2 | |
| Income from continuing operations | 731 | | | 1,763 | | | 857 | | | | 5,623 | | | 1,429 | |
| Provision for (benefit from) income taxes | 135 | | | 452 | | | 39 | | | | 1,163 | | | (43) | |
| Depreciation and amortization | 377 | | | 351 | | | 329 | | | | 1,393 | | | 1,385 | |
| Interest expense, net | 152 | | | 125 | | | 188 | | | | 510 | | | 514 | |
| add: LCM charges (benefits), pre-tax | — | | | — | | | (147) | | | | — | | | 16 | |
| EBITDA excluding LCM | 1,395 | | | 2,691 | | | 1,266 | | | | 8,689 | | | 3,301 | |
| add: Impairments, pre-tax | 624 | | | — | | | — | | | | 624 | | | 582 | |
| EBITDA excluding LCM and impairment | 2,019 | | | 2,691 | | | 1,266 | | | | 9,313 | | | 3,883 | |
| less: LCM (charges) benefits, pre-tax | — | | | — | | | 147 | | | | — | | | (16) | |
| less: Impairments, pre-tax | (624) | | | — | | | — | | | | (624) | | | (582) | |
| EBITDA | $ | 1,395 | | | $ | 2,691 | | | $ | 1,413 | | | | $ | 8,689 | | | $ | 3,285 | |
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| Table 3 - Reconciliation of Diluted EPS to Diluted EPS Excluding LCM and Impairment |
| | | Three Months Ended | | Year Ended |
| | | December 31,
2021 | | | | | | | | September 30,
2021 | | December 31,
2020 | | December 31,
2021 | | December 31,
2020 |
| Diluted earnings per share | | | $ | 2.18 | | | | | | | | | $ | 5.25 | | | $ | 2.55 | | | $ | 16.75 | | | $ | 4.24 | |
| Add: | | | | | | | | | | | | | | | | | |
| LCM charges (benefits) | | | — | | | | | | | | | — | | | (0.36) | | | — | | | 0.03 | |
| Impairments | | | 1.45 | | | | | | | | | — | | | — | | | 1.44 | | | 1.34 | |
| Diluted earnings per share excluding LCM and impairment | | | $ | 3.63 | | | | | | | | | $ | 5.25 | | | $ | 2.19 | | | $ | 18.19 | | | $ | 5.61 | |
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| Table 4 - Calculation of Free Cash Flow |
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| | Year Ended | |
| (Millions of U.S. dollars) | | December 31,
2021 | |
| Net cash provided by operating activities | | $ | 7,602 | | |
| Less: | | | |
| Capital expenditures | | 1,866 | | |
| Free cash flow | | $ | 5,736 | | |
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LYONDELLBASELL BUSINESS RESULTS DISCUSSION BY REPORTING SEGMENT
LyondellBasell manages operations through six operating segments: 1) Olefins and Polyolefins - Americas; 2) Olefins and Polyolefins - Europe, Asia and International; 3) Intermediates and Derivatives; 4) Advanced Polymer Solutions; 5) Refining; and 6) Technology.
This information should be read in conjunction with our Earnings Release for the period ended December 31, 2021, including the forward-looking statements and information related to financial measures. Comments and analysis represent underlying business activity and are exclusive of LCM and impairment.
Olefins & Polyolefins - Americas (O&P-Americas) - Our O&P-Americas segment produces and markets Olefins & Co-products, polyethylene and polypropylene.
Table 1 - O&P-Americas Financial Overview | | | | | | | | | | | | | | | | | |
| Millions of U.S. dollars | Three Months Ended | Year Ended |
| December 31, 2021 | September 30, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 |
| Operating income | $1,067 | $1,403 | $516 | $4,552 | $1,170 |
| EBITDA | 1,262 | 1,568 | 722 | 5,273 | 1,810 |
| LCM (benefits) charges, pre-tax | — | — | — | — | 3 |
| EBITDA excluding LCM | 1,262 | 1,568 | 722 | 5,273 | 1,813 |
Three months ended December 31, 2021 versus three months ended September 30, 2021 - EBITDA decreased $306 million versus the third quarter 2021. Compared to the prior period, olefins results declined by approximately $190 million driven by compressed margins primarily due to lower prices for ethylene and propylene. We operated our ethylene crackers at 97 percent of capacity with the raw materials being about 65 percent ethane and 20 percent other natural gas liquids. Polyolefins results decreased about $120 million driven by lower spreads with declining prices for polyethylene and polypropylene outpacing decreases in monomer prices, partially offset by record polyethylene volume driven by strong demand.
Three months ended December 31, 2021 versus three months ended December 31, 2020 - EBITDA increased $540 million versus the fourth quarter 2020. Compared to the prior period, olefins results increased more than $190 million driven by higher margins partially offset by lower volumes. Margins increased due to higher ethylene and propylene prices outpacing increased feedstock and energy costs. Ethylene volumes declined as inventories were built for planned maintenance in the first quarter 2022. Polyolefins results increased about $345 million driven by wider margins with polyethylene and polypropylene price increases outpacing monomer price increases.
Full year ended December 31, 2021 versus full year ended December 31, 2020 - EBITDA increased $3,460 million versus 2020. The record results for 2021 benefited from approximately $50 million of last-in, first out (LIFO) inventory valuation charges which occurred in the prior period. Olefins results increased $1,955 million versus 2020 driven by a significant increase in margin with higher ethylene and propylene prices outpacing higher
feedstock costs and energy prices. Polyolefins results increased $1,375 million driven by improved margins with polyethylene and polypropylene price increases outpacing monomer price increases. Joint venture equity income increased $70 million due to increased spreads and volumes.
Olefins & Polyolefins - Europe, Asia, International (O&P-EAI) - Our O&P-EAI segment produces and markets Olefins & Co-products, polyethylene and polypropylene.
Table 2 - O&P-EAI Financial Overview | | | | | | | | | | | | | | | | | |
| Millions of U.S. dollars | Three Months Ended | Year Ended |
| December 31, 2021 | September 30, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 |
| Operating income | $57 | $361 | $144 | $1,228 | $412 |
| EBITDA | 155 | 474 | 304 | 1,749 | 826 |
| LCM (benefits) charges, pre-tax | — | — | (53) | — | — |
| EBITDA excluding LCM | 155 | 474 | 251 | 1,749 | 826 |
Three months ended December 31, 2021 versus three months ended September 30, 2021 - EBITDA decreased $319 million versus the third quarter 2021. Fourth quarter 2021 results decreased approximately $30 million due to LIFO inventory valuation charges and $10 million due to a decrease in the euro versus the U.S. dollar exchange rate relative to the third quarter 2021. Olefins results decreased about $180 million due to lower margins and volumes. Margins declined driven by higher feedstock and energy costs, partially offset by higher ethylene and propylene prices. We operated the ethylene crackers at 70 percent due to planned maintenance on two of our crackers with approximately 30 percent of the raw materials derived from non-naphtha feedstocks. Combined polyolefins results decreased about $100 million driven by lower margins due to higher energy costs and lower product price spreads over monomer. Joint venture equity income decreased approximately $15 million due to higher energy costs and lower spreads.
Three months ended December 31, 2021 versus three months ended December 31, 2020 - EBITDA decreased $96 million versus the fourth quarter 2020, excluding an unfavorable $53 million variance due to LCM inventory benefits in the fourth quarter 2020. Fourth quarter 2021 results decreased approximately $50 million due to LIFO inventory valuation changes relative to the prior period. Compared with the prior period, olefins results decreased about $100 million due to lower margins and volumes. Margins declined driven by higher feedstock and energy costs, partially offset by increased ethylene and propylene prices. Volumes declined due to planned maintenance. Combined polyolefins results increased approximately $100 million largely due to higher margins. Strong demand and tight markets drove spreads higher, partially offset by increased energy costs. Joint venture equity income decreased about $50 million driven by increased energy costs and lower spreads.
Full year ended December 31, 2021 versus full year ended December 31, 2020 - EBITDA increased $923 million versus 2020. Full year 2021 results include the benefit of approximately $40 million due to an increase in the euro versus the U.S. dollar exchange rate relative to 2020 partially offset by the impact of approximately $25 million due to LIFO inventory changes. Compared with the prior period, olefins results decreased about $30 million driven by higher feedstock costs outpacing increased ethylene and propylene prices. Combined polyolefins results increased more than $815 million due to higher margins with increases in polyethylene and polypropylene prices outpacing monomer price increases. Joint venture equity income increased approximately $125 million driven by higher margins.
Intermediates & Derivatives (I&D) - Our I&D segment produces and markets Propylene Oxide & Derivatives, Oxyfuels & Related Products and Intermediate Chemicals, such as styrene monomer, acetyls, ethylene oxide and ethylene glycol.
Table 3 - I&D Financial Overview | | | | | | | | | | | | | | | | | |
| Millions of U.S. dollars | Three Months Ended | Year Ended |
| December 31, 2021 | September 30, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 |
| Operating income | $139 | $247 | $166 | $967 | $501 |
| EBITDA | 252 | 348 | 262 | 1,378 | 833 |
| LCM (benefits) charges, pre-tax | — | — | (66) | — | 10 |
| EBITDA excluding LCM | 252 | 348 | 196 | 1,378 | 843 |
Three months ended December 31, 2021 versus three months ended September 30, 2021 - EBITDA decreased $96 million versus the third quarter 2021. Results for the fourth quarter 2021 decreased approximately $95 million due to LIFO inventory valuation charges relative to the prior quarter, partially offset by a decrease of approximately $20 million in site closure costs for our ethanol business relative to the third quarter 2021. Compared to the prior period, Propylene Oxide & Derivatives results increased approximately $5 million driven by higher margins due to tight markets and strong demand partially offset by lower volumes due to planned maintenance. Intermediate Chemicals results increased about $65 million due to higher volumes and margins. Volumes increased due to the absence of planned and unplanned downtime incurred by our acetyls business during the third quarter 2021. Margins improved primarily in styrene partially offset by a decline in acetyls and methanol. Oxyfuels & Related Products results decreased about $85 million driven by lower margins due to higher butane feedstock price and a decrease in volumes due to planned maintenance.
Three months ended December 31, 2021 versus three months ended December 31, 2020 - EBITDA increased $56 million versus the fourth quarter 2020, excluding an unfavorable $66 million variance due to LCM inventory benefits in the fourth quarter 2020. Results for the fourth quarter 2021 decreased approximately $40 million due to LIFO inventory valuation changes relative to the prior quarter. Compared to the prior period, Propylene Oxide & Derivatives results increased approximately $115 million with improved margins due to strong Asian demand and market tightness partially offset by high energy costs and lower volumes. Intermediate Chemicals results increased approximately $45 million driven by higher margins partially offset by lower volumes. Margins increased due to improved product prices partially offset by higher feedstock costs. Volumes decreased due to planned and unplanned maintenance. Oxyfuels & Related Products results decreased about $25 million driven by lower margins. Margins declined primarily due to higher butane feedstock prices.
Full year ended December 31, 2021 versus full year ended December 31, 2020 - EBITDA increased $535 million versus 2020, excluding a favorable $10 million variance due to LCM inventory charges in 2020. Results for 2021 decreased approximately $60 million due to LIFO inventory valuation changes relative to the prior period and by approximately $35 million due to site closure costs for our ethanol business in 2021. Compared to the prior period, Propylene Oxide & Derivatives results increased approximately $440 million driven by increased margins as strong demand drove margins to a new record high during the year. Intermediate Chemicals results increased about $150 million driven by higher margins with strong demand and tight markets driving price increases in most products. Oxyfuels & Related Products increased approximately $45 million driven by higher margins due to improved gasoline demand.
Advanced Polymer Solutions (APS) - Our Advanced Polymer Solutions segment produces and markets in two lines of business: Compounding & Solutions and Advanced Polymers. Compounding & Solutions includes polypropylene compounds, engineered plastics, masterbatches, engineered composites, colors and powders. Advanced Polymers consists of Catalloy and polybutene-1.
Table 4 - Advanced Polymer Solutions Financial Overview | | | | | | | | | | | | | | | | | |
| Millions of U.S. dollars | Three Months Ended | Year Ended |
| December 31, 2021 | September 30, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 |
| Operating income (loss) | ($13) | $94 | $123 | $286 | $226 |
| EBITDA | 24 | 121 | 152 | 409 | 378 |
| LCM (benefits) charges, pre-tax | — | — | (26) | — | 3 |
| EBITDA excluding LCM | 24 | 121 | 126 | 409 | 381 |
Three months ended December 31, 2021 versus three months ended September 30, 2021 - EBITDA decreased $97 million versus the third quarter 2021. Fourth quarter 2021 results decreased approximately $55 million due to LIFO inventory valuation charges relative to the third quarter 2021. Compared to the prior quarter, Compounding & Solutions results decreased approximately $40 million due to lower margins and volumes. Margins declined driven by higher raw material and energy costs. Volumes declined due to lower demand in the automotive and electronics industry as a result of the continued semiconductor shortage. Advanced Polymers results were relatively unchanged with an improvement in margin offset by a decline in volume.
Three months ended December 31, 2021 versus three months ended December 31, 2020 - EBITDA decreased $102 million versus the fourth quarter 2020, excluding an unfavorable $26 million variance due to LCM inventory benefits in the fourth quarter 2020. Results for fourth quarter 2021 decreased approximately $60 million due to LIFO inventory valuation charges in the current period. Compared to the prior period, Compounding & Solutions results decreased about $60 million due to lower volumes and margins. Volumes declined driven by constrained production in automotive, appliance and other end markets as a result of semiconductor shortages. Advanced Polymers results increased approximately $10 million due to improved margins partially offset by lower volumes. Margins increased as spreads improved with higher product prices.
Full year ended December 31, 2021 versus full year ended December 31, 2020 - EBITDA increased $28 million versus 2020. Results for 2021 decreased approximately $45 million due to LIFO inventory valuation changes relative to the prior period. Compared to the prior period, results benefited from a reduction in integration costs of approximately $35 million. Compounding & Solutions results were relatively unchanged with a decline in margin offset by an improvement in volume. Advanced Polymers results increased approximately $40 million due to higher margins and volumes driven by increased construction market demand.
Refining - Our Refining segment produces and markets gasoline and distillates, including diesel fuel, heating oil and jet fuel.
Table 5 - Refining Financial Overview | | | | | | | | | | | | | | | | | |
| Millions of U.S. dollars | Three Months Ended | Year Ended |
| December 31, 2021 | September 30, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 |
| Operating income (loss) | $(496) | $25 | $(93) | $(696) | $(1,024) |
| EBITDA | (474) | 41 | (72) | (624) | (871) |
| LCM (benefits) charges, pre-tax | — | — | (2) | — | — |
| Impairment, pre-tax | 624 | — | — | 624 | 582 |
| EBITDA excluding LCM and impairment | 150 | 41 | (74) | — | (289) |
Three months ended December 31, 2021 versus three months ended September 30, 2021 - EBITDA increased $109 million versus the third quarter 2021, excluding an impairment of $624 million for the Houston Refinery. Fourth quarter 2021 results benefited approximately $50 million due to LIFO effects from reduced inventory volumes. Margins improved driven by optimization of product mix and an increase in the Maya 2-1-1 industry benchmark crack spread to $23.58 per barrel. The Houston Refinery operated at nearly full utilization rate or an average crude throughput of 266,000 barrels per day.
Three months ended December 31, 2021 versus three months ended December 31, 2020 - EBITDA increased $224 million versus the fourth quarter 2020, excluding an impairment of $624 million in the fourth quarter 2021 and an unfavorable variance of $2 million due to LCM benefits in the fourth quarter 2020. Results for the fourth quarter 2021 increased approximately $45 million due to LIFO inventory valuation changes relative to the prior period. Margin improved as the Maya 2-1-1 industry benchmark increased by $13.47 per barrel relative to same period last year, partially offset by higher renewable identification number credits (RINs) cost. The Houston Refinery operated at 266,000 barrels per day, 52,000 barrels per day higher than prior period due to improved demand for refined products.
Full year ended December 31, 2021 versus full year ended December 31, 2020 - EBITDA increased $289 million versus 2020, excluding an impairment of $624 million in the fourth quarter 2021 and $582 million in the third quarter 2020 for the Houston Refinery. Results for 2021 increased approximately $45 million due to LIFO inventory valuation changes relative to the prior period. Margins improved driven by an increase in the Maya 2-1-1 industry benchmark from $12.63 per barrel to $20.87 per barrel, partially offset by higher RINs cost. Crude throughput averaged 231,000 barrels per day, 8,000 barrels per day higher than prior period in response to market demand.
Technology - Our Technology segment develops and licenses chemical and polyolefin process technologies and manufactures and sells polyolefin catalysts.
Table 6 - Technology Financial Overview | | | | | | | | | | | | | | | | | |
| Millions of U.S. dollars | Three Months Ended | Year Ended |
| December 31, 2021 | September 30, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 |
| Operating income | $163 | $144 | $35 | $471 | $287 |
| EBITDA | 173 | 155 | 45 | 514 | 324 |
| | | | | |
| | | | | |
Three months ended December 31, 2021 versus three months ended September 30, 2021 - EBITDA increased $18 million compared to the third quarter 2021 resulting in new quarterly records for catalyst volumes, licensing revenue and segment EBITDA. Catalyst volumes were driven by increased demand in Asia. Licensing improved as a higher number of contracts attained revenue milestones.
Three months ended December 31, 2021 versus three months ended December 31, 2020 - EBITDA increased $128 million versus the fourth quarter 2020 driven by higher licensing revenue and increased catalyst volumes.
Full year ended December 31, 2021 versus full year ended December 31, 2020 - EBITDA increased $190 million versus 2020. The record 2021 EBITDA was driven by higher licensing revenue and catalyst results. Catalyst volumes increased due to strong global demand.
Capital Spending and Cash Balances
Capital expenditures, including growth projects, maintenance turnarounds, catalyst and information technology-related expenditures, were $581 million during the fourth quarter 2021 and $1.9 billion for the full year 2021. As of December 31, 2021, our cash and liquid investment balance was $1.5 billion, which includes cash and cash equivalents, restricted cash and short-term investments. We repurchased approximately 5.2 million shares during 2021. There were 330 million common shares outstanding as of December 31, 2021. The company paid dividends of $1.5 billion during 2021.
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| Table 7 - Reconciliation of EBITDA to EBITDA Excluding LCM and Impairment by Segment |
| | | | | | | | | | |
| | Three Months Ended | | Year Ended |
| Millions of U.S. dollars | | December 31, 2021 | | September 30, 2021 | | December 31, 2020 | | December 31, 2021 | | December 31, 2020 |
| EBITDA: | | | | | | | | | | |
| Olefins & Polyolefins - Americas | | $ | 1,262 | | | $ | 1,568 | | | $ | 722 | | | $ | 5,273 | | | $ | 1,810 | |
| Olefins & Polyolefins - EAI | | 155 | | | 474 | | | 304 | | | 1,749 | | | 826 | |
| Intermediates & Derivatives | | 252 | | | 348 | | | 262 | | | 1,378 | | | 833 | |
| Advanced Polymer Solutions | | 24 | | | 121 | | | 152 | | | 409 | | | 378 | |
| Refining | | (474) | | | 41 | | | (72) | | | (624) | | | (871) | |
| Technology | | 173 | | | 155 | | | 45 | | | 514 | | | 324 | |
| Other | | 3 | | | (16) | | | — | | | (10) | | | (15) | |
| Continuing Operations | | $ | 1,395 | | | $ | 2,691 | | | $ | 1,413 | | | $ | 8,689 | | | $ | 3,285 | |
| | | | | | | | | | |
| Add: LCM charges (benefits), pre-tax: | | | | | | | | | | |
| Olefins & Polyolefins - Americas | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | 3 | |
| Olefins & Polyolefins - EAI | | — | | | — | | | (53) | | | — | | | — | |
| Intermediates & Derivatives | | — | | | — | | | (66) | | | — | | | 10 | |
| Advanced Polymer Solutions | | — | | | — | | | (26) | | | — | | | 3 | |
| Refining | | — | | | — | | | (2) | | | — | | | — | |
| | | | | | | | | | |
| | | | | | | | | | |
| Continuing Operations | | $ | — | | | $ | — | | | $ | (147) | | | $ | — | | | $ | 16 | |
| | | | | | | | | | |
| EBITDA excluding LCM: | | | | | | | | | | |
| Olefins & Polyolefins - Americas | | $ | 1,262 | | | $ | 1,568 | | | $ | 722 | | | $ | 5,273 | | | $ | 1,813 | |
| Olefins & Polyolefins - EAI | | 155 | | | 474 | | | 251 | | | 1,749 | | | 826 | |
| Intermediates & Derivatives | | 252 | | | 348 | | | 196 | | | 1,378 | | | 843 | |
| Advanced Polymer Solutions | | 24 | | | 121 | | | 126 | | | 409 | | | 381 | |
| Refining | | (474) | | | 41 | | | (74) | | | (624) | | | (871) | |
| Technology | | 173 | | | 155 | | | 45 | | | 514 | | | 324 | |
| Other | | 3 | | | (16) | | | — | | | (10) | | | (15) | |
| Continuing Operations | | $ | 1,395 | | | $ | 2,691 | | | $ | 1,266 | | | $ | 8,689 | | | $ | 3,301 | |
| | | | | | | | | | |
| Add: Impairments, pre-tax: | | | | | | | | | | |
| Refining | | $ | 624 | | | $ | — | | | $ | — | | | $ | 624 | | | $ | 582 | |
| | | | | | | | | | |
| EBITDA excluding LCM and impairment: | | | | | | | | | | |
| Olefins & Polyolefins - Americas | | $ | 1,262 | | | $ | 1,568 | | | $ | 722 | | | $ | 5,273 | | | $ | 1,813 | |
| Olefins & Polyolefins - EAI | | 155 | | | 474 | | | 251 | | | 1,749 | | | 826 | |
| Intermediates & Derivatives | | 252 | | | 348 | | | 196 | | | 1,378 | | | 843 | |
| Advanced Polymer Solutions | | 24 | | | 121 | | | 126 | | | 409 | | | 381 | |
| Refining | | 150 | | | 41 | | | (74) | | | — | | | (289) | |
| Technology | | 173 | | | 155 | | | 45 | | | 514 | | | 324 | |
| Other | | 3 | | | (16) | | | — | | | (10) | | | (15) | |
| Continuing Operations | | $ | 2,019 | | | $ | 2,691 | | | $ | 1,266 | | | $ | 9,313 | | | $ | 3,883 | |
| | | | | | | | | | |
