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LyondellBasell (LYB) Starts Discourse on Production Unit Closure
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LyondellBasell Industries N.V. (LYB - Free Report) commenced discussions with local trade unions to manage potential redundancies in connection with the planned shutdown of one of its two polypropylene production units at its Brindisi location in Italy.
LyondellBasell believes that closing this unit is the most sustainable response, both strategically and financially. Some of the company's employees may be affected by the planned closure. It is committed to discussing solutions with unions and social parties to effectively serve them. Customers of the company will continue to be serviced.
This unit is the world's oldest of its kind, and it has become uncompetitive, LYB noted. The market environment for this Brindisi unit's polypropylene products has become increasingly difficult. The company intends to increase the position of its remaining assets in higher-value markets.
Shares of LYB have gained 21.1% over the past year compared with the 10.4% growth of its industry.
Image Source: Zacks Investment Research
In the third quarter, LyondellBasell expects soft demand due to ongoing economic uncertainty to offset the usual benefits from summer seasonality. Challenging petrochemical margins are being influenced by stagnant demand, volatile feedstock costs and increased capacity in North America and China.
However, the company anticipates attractive oxyfuels and refining margins, supported by summer demand for transportation fuels. During this period, LyondellBasell plans to maintain average operating rates of 85% for North American olefins and polyolefins (O&P) assets, and 75% for European O&P, as well as Intermediates & Derivatives assets, in accordance with global market demand.
Despite the current challenging economic conditions and a slower recovery in China, the company remains committed to its long-term strategy. LyondellBasell is focused on advancing in Circular & Low Carbon Solutions. Its Value Enhancement Program is benefiting shareholders.
LyondellBasell Industries N.V. Price and Consensus
LyondellBasell currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the basic materials space include Carpenter Technology Corporation (CRS - Free Report) , Denison Mine Corp. (DNN - Free Report) and Veritiv Corporation .
Carpenter Technology currently sports a Zacks Rank #1 (Strong Buy). CRS shares have rallied 85.1% in the past year. CRS beat the Zacks Consensus Estimate in three of the last four quarters and matched once. It delivered a trailing four-quarter earnings surprise of 9.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
Denison Mines currently carries a Zacks Rank #1. Denison Mines shares have gained 8.9% in the past year. DNN beat the Zacks Consensus Estimate in three of the last four quarters and met once. It delivered a trailing four-quarter earnings surprise of 75%, on average.
Veritiv currently carries a Zacks Rank #2 (Buy). Veritiv shares have rallied 36.2% in the past year. VRTV beat the Zacks Consensus Estimate in three of the last four quarters and missed once. It delivered a trailing four-quarter earnings surprise of 6%, on average.
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LyondellBasell (LYB) Starts Discourse on Production Unit Closure
LyondellBasell Industries N.V. (LYB - Free Report) commenced discussions with local trade unions to manage potential redundancies in connection with the planned shutdown of one of its two polypropylene production units at its Brindisi location in Italy.
LyondellBasell believes that closing this unit is the most sustainable response, both strategically and financially. Some of the company's employees may be affected by the planned closure. It is committed to discussing solutions with unions and social parties to effectively serve them. Customers of the company will continue to be serviced.
This unit is the world's oldest of its kind, and it has become uncompetitive, LYB noted. The market environment for this Brindisi unit's polypropylene products has become increasingly difficult. The company intends to increase the position of its remaining assets in higher-value markets.
Shares of LYB have gained 21.1% over the past year compared with the 10.4% growth of its industry.
Image Source: Zacks Investment Research
In the third quarter, LyondellBasell expects soft demand due to ongoing economic uncertainty to offset the usual benefits from summer seasonality. Challenging petrochemical margins are being influenced by stagnant demand, volatile feedstock costs and increased capacity in North America and China.
However, the company anticipates attractive oxyfuels and refining margins, supported by summer demand for transportation fuels. During this period, LyondellBasell plans to maintain average operating rates of 85% for North American olefins and polyolefins (O&P) assets, and 75% for European O&P, as well as Intermediates & Derivatives assets, in accordance with global market demand.
Despite the current challenging economic conditions and a slower recovery in China, the company remains committed to its long-term strategy. LyondellBasell is focused on advancing in Circular & Low Carbon Solutions. Its Value Enhancement Program is benefiting shareholders.
LyondellBasell Industries N.V. Price and Consensus
LyondellBasell Industries N.V. price-consensus-chart | LyondellBasell Industries N.V. Quote
Zacks Rank & Key Picks
LyondellBasell currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the basic materials space include Carpenter Technology Corporation (CRS - Free Report) , Denison Mine Corp. (DNN - Free Report) and Veritiv Corporation .
Carpenter Technology currently sports a Zacks Rank #1 (Strong Buy). CRS shares have rallied 85.1% in the past year. CRS beat the Zacks Consensus Estimate in three of the last four quarters and matched once. It delivered a trailing four-quarter earnings surprise of 9.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
Denison Mines currently carries a Zacks Rank #1. Denison Mines shares have gained 8.9% in the past year. DNN beat the Zacks Consensus Estimate in three of the last four quarters and met once. It delivered a trailing four-quarter earnings surprise of 75%, on average.
Veritiv currently carries a Zacks Rank #2 (Buy). Veritiv shares have rallied 36.2% in the past year. VRTV beat the Zacks Consensus Estimate in three of the last four quarters and missed once. It delivered a trailing four-quarter earnings surprise of 6%, on average.