Westlake Chemical Partners Q2 2026 Earnings Report

Westlake Chemical Partners EPS Results

• Actual EPS: $0.40
• Consensus EPS: $0.41
• Beat/Miss: Missed by -$0.01
• One Year Ago EPS: N/A

Westlake Chemical Partners Revenue Results

• Actual Revenue: $297.10 million
• Expected Revenue: $537.00 million
• Beat/Miss: Missed by -$239.90 million
• YoY Revenue Growth: N/A

Westlake Chemical Partners Announcement Details

• Quarter: Q2 2026
• Date: 8/4/2026
• Time: Before Market Opens
• Conference Call Date: Tuesday, August 4, 2026
• Conference Call Time: 1:00PM ET

Westlake Chemical Partners (NYSE:WLKP) (NYSE: WLKP) is a publicly traded master limited partnership sponsored by Westlake Chemical Corporation. The partnership owns, operates and acquires a portfolio of ethylene and vinyl manufacturing assets throughout the United States and the United Kingdom. As a downstream producer of basic chemicals and intermediates, WLKP supplies key industrial feedstocks to customers in a variety of end markets.

WLKP’s operations are organized into two primary segments: olefins and vinyls. In the olefins segment, the partnership operates an ethylene cracker and related fractionation facilities that produce ethylene and propylene, which serve as building blocks for polyethylene, polypropylene and other specialty polymers. The vinyls segment includes vinyl chloride monomer (VCM), polyvinyl chloride (PVC) and chlor-alkali production, as well as related by-product recovery units. These products are used in construction materials, pipe and profile applications, packaging and flexible film.

Founded in December 2012, Westlake Chemical Partners has grown through strategic acquisitions and expansions of its manufacturing footprint. In mid-2014, for example, WLKP acquired Westlake Chemical’s North American VCM and PVC assets, strengthening its vinyls platform. The partnership also maintains a significant presence in the United Kingdom through its Westlake Vinyls Europe joint venture, which supplies European and global markets.

Governed by an experienced board of directors and managed day-to-day by Westlake Chemical Corporation under a long-term services agreement, WLKP leverages technical expertise in process optimization and operational reliability. Its integrated asset base and focused business model are designed to deliver consistent production, flexibility in feedstock sourcing and stable distributions to unitholders.

Westlake Chemical Partners Q2 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Stable earnings and cash flow: Second-quarter net income was $14 million, or $0.40 per unit, broadly in line with both the prior-year and first-quarter results. Distributable cash flow rose to $18 million, up $3 million year over year, supported by higher production and sales volumes and lower maintenance spending.
• Positive Sentiment: Distribution remains well supported: The Partnership declared a $0.4714 per-unit quarterly distribution, marking its 48th consecutive quarterly payment and a 71% increase from its IPO-era minimum distribution. Trailing 12-month distribution coverage improved to 1.04 times.
• Positive Sentiment: Strong balance sheet and financing position: Consolidated leverage remained approximately 1.0 times, with $93 million in cash and investments and $400 million of long-term debt. Revolver agreements were extended through 2031 with a 10-basis-point interest-rate reduction.
• Positive Sentiment: Limited exposure to ethylene price volatility: Management said the fixed-margin Ethylene Sales Agreement provides a $0.10-per-pound margin on 95% of production, insulating the Partnership from heightened chemical-price volatility related to Middle East conflict.
• Neutral Sentiment: Management cited four potential future growth avenues—higher ownership of OpCo, acquisitions, facility expansions, and a higher fixed margin—but provided no specific transaction, timing, or financial targets.

Presentation

[Operator]

Good afternoon. Thank you for standing by. Welcome to the Westlake Chemical Partners second quarter 2026 earnings conference call. During the presentation, all participants will be in a listen-only mode. After the speaker's remarks, you will be invited to participate in a question and answer session. As a reminder, this conference is being recorded today, August 4th, 2026. I would now like to turn the call over to today's host, Jeff Holy, Westlake Chemical Partners Vice President and Chief Accounting Officer. Sir, you may begin.

[Jeff Holy, VP and Chief Accounting Officer at Westlake Chemical Partners]

Thank you. Good afternoon, everyone, and welcome to the Westlake Chemical Partners second quarter 2026 conference call. I am joined today by Albert Chao, our Executive Chairman, Jean Marc Gilson, our President and CEO, John Bochert, our Senior Vice President and Chief Financial Officer, Steve Bender, our Special Advisor to the President, and other members of our management team. During this call, we refer to ourselves as Westlake Partners or the Partnership. References to Westlake refer to our parent company, Westlake Corporation, and references to OpCo refer to Westlake Chemical OpCo LP, a subsidiary of Westlake and the Partnership, which owns certain olefin assets. Additionally, when we refer to distributable cash flow, we are referring to Westlake Chemical Partners MLP distributable cash flow. Definitions of these terms are available on the Partnership's website.

[Jeff Holy, VP and Chief Accounting Officer at Westlake Chemical Partners]

Today, management is going to discuss certain topics that will contain forward-looking information that is based on management's beliefs, as well as assumptions made by, and information currently available to management. These forward-looking statements suggest predictions or expectations and thus are subject to risks or uncertainties. We encourage you to learn more about the factors that could lead our actual results to differ by reviewing the cautionary statements in our regulatory filings, which are also available on our investor relations website. This morning, Westlake Partners issued a press release with details of our second quarter 2026 financial and operating results. This document is available in the press release section of our webpage at wlkpartners.com. A replay of today's call will be available beginning two hours after the conclusion of this call. The replay can be accessed via the Partnership's website.

[Jeff Holy, VP and Chief Accounting Officer at Westlake Chemical Partners]

Please note that information reported on this call speaks only as of today, August 4th, 2026, and therefore you are advised that time-sensitive information may no longer be accurate as of the time of any replay. I would finally advise you that this conference call is being broadcast live through an internet webcast system that can be accessed on our webpage at wlkpartners.com. Now, I would like to turn the call over to Jean Marc Gilson. Jean Marc?

[Jean Marc Gilson, President and CEO at Westlake Chemical Partners]

Thank you, Jeff, and good afternoon, everyone, and thank you for joining us to discuss our second quarter 2026 results. In this morning's press release, we reported Westlake Partners' second quarter 2026 net income of $14 million, or $0.40 per unit, which was in line with our net income in the first quarter. The stability of Westlake Partners' business model is consistently demonstrated through our fixed margin Ethylene Sales Agreement, which minimizes market volatility and other production risks. The high degree of stability in cash flow, when paired with the predictability of our business, has enabled us to deliver the long history of reliable distributions and coverage. This quarter distribution is the 48th consecutive quarterly distribution since our IPO in July of 2014, without any reductions.

[Jean Marc Gilson, President and CEO at Westlake Chemical Partners]

Before I turn the call over to John, I want to take this opportunity to thank Steve Bender for all of his many contributions to the Partnership as our CFO since its formation over a decade ago, and wish him the best of luck with his upcoming retirement.

[Steve Bender, Special Advisor to the President at Westlake Chemical Partners]

Thank you, Jean Marc, and it's been a pleasure working with you, Albert, and James Chao, and the entire Westlake Chemical Partners team for many years. I leave for retirement next month knowing that the Partnership is on very firm financial footing, having recently renewed both its revolver and the Ethylene Sales Agreement with Westlake. With that, I'll turn the call over to the Partnership's new Chief Financial Officer, John Bochert. John?

[John Bochert, SVP and CFO at Westlake Chemical Partners]

Thank you, Steve. Your contributions to the Partnership will be missed, and we all wish you the best of luck in your retirement. In this morning's press release, we reported Westlake Partners' second quarter 2026 net income of $14 million, or $0.40 per unit. Consolidated net income, including OpCo's earnings, was $82 million on consolidated net sales of $297 million. The Partnership had distributable cash flow for the quarter of $18 million, or $0.50 per unit. Second quarter 2026 net income for Westlake Partners of $14 million was essentially in line with the second quarter 2025 Partnership net income. Distributable cash flow of $18 million for the second quarter of 2026 increased by $3 million compared to the second quarter of 2025 due to the higher production and sales volume and lower maintenance capital expenditures as a result of last year's Petro 1 plant turnaround.

[John Bochert, SVP and CFO at Westlake Chemical Partners]

On a sequential basis, net income for Westlake Partners of $14 million in the second quarter of 2026 was in line with the first quarter on relatively stable production and sales volume. Sequentially, our trailing 12-month coverage ratio improved to 1.04 times from 1.0 times, reflecting the aging out of the impact of the Petro 1 turnaround that occurred in the first half of 2025. Turning our attention to the balance sheet and cash flows. At the end of the second quarter, we had consolidated cash balance and cash investments with Westlake through our Investment Management Agreement totaling $93 million. Long-term debt at the end of the quarter was $400 million, of which $377 million was at the partnership, and the remaining $23 million was at OpCo.

[John Bochert, SVP and CFO at Westlake Chemical Partners]

In the second quarter of 2026, OpCo spent $12 million on capital expenditures. We maintained our strong leverage metrics with a consolidated leverage ratio of approximately one time. Last month, both OpCo and the partnership extended their existing revolver agreements with Westlake for an additional four years through 2031. Additionally, we successfully negotiated a 10 basis point reduction in the associated interest rate. As was the case earlier this year when Westlake extended our Ethylene Sales Agreement, we believe that the revolver extension demonstrates the critical nature of OpCo's supply of ethylene to their operations and their commitment to support OpCo's continued safe, reliable operations through stable, predictable cash flows. On August 3, 2026, we announced a quarterly distribution of $0.4714 per unit with respect to the second quarter of 2026.

[John Bochert, SVP and CFO at Westlake Chemical Partners]

Since our IPO in 2014, the partnership has made 48 consecutive quarterly distributions to our unit holders, and we have grown distributions 71% since the partnership's original Minimum Quarterly Distribution of $0.275 per unit. The partnership's second quarter distribution will be paid on August 28, 2026 to unit holders of record on August 13, 2026. The partnership's predictable fee-based cash flow continues to prove beneficial in today's economic environment and is differentiated by the consistency of our earnings and cash flows. Looking back, since our IPO in July of 2014, we have maintained a cumulative distribution coverage ratio in excess of one time. With the partnership's stability and cash flows, we are able to sustain our current distribution without the need to access the capital markets. For modeling purposes, we have no planned turnarounds in 2026.

[John Bochert, SVP and CFO at Westlake Chemical Partners]

Now I'd like to turn the call back over to Jean Marc to make some closing comments. Jean Marc?

[Jean Marc Gilson, President and CEO at Westlake Chemical Partners]

Thank you, John. We are pleased with the partnership's financial and operational performance during the second quarter. Solid operating rates at OpCo's ethylene facilities during the quarter resulted in a quarterly coverage ratio of 1.0 time. Turning to our outlook, the conflict in the Middle East has created increased volatility in chemical prices, including ethylene. However, the partnership's ethylene margins remain largely immune to the heightened market price volatility, thanks to its Ethylene Sales Agreement with Westlake. That provides for a fixed margin of $0.10 per pound on 95% of our ethylene production. Turning to our capital structure, we maintain a strong balance sheet with conservative financial and leverage metrics.

[Jean Marc Gilson, President and CEO at Westlake Chemical Partners]

As we continue to navigate market conditions, we will evaluate opportunities via our four levers of growth in the future, including increases of our ownership interest of OpCo, acquisitions of other qualified income streams, organic growth opportunities such as expansions of our current ethylene facilities, and negotiation of a higher fixed margin in our Ethylene Sales Agreement with Westlake. We remain focused on our ability to continue to provide long-term value and distributions to our unitholders. As always, we will continue to focus on safe operations, along with being good stewards of the environment where we work and live as part of our broader sustainability efforts. Thank you very much for listening to our second quarter earnings call. Now I will turn the call back over to Jeff.

[Jeff Holy, VP and Chief Accounting Officer at Westlake Chemical Partners]

Thank you, Jean Marc. Before we begin taking questions, I would like to remind you that a replay of this teleconference will be available two hours after the call has ended. We'll provide instructions to access the replay at the end of the call. Ari, we will now take questions.

[Operator]

Thank you. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. I'm showing no questions at this time. I will turn the call back over to Jeff Holy.

[Jeff Holy, VP and Chief Accounting Officer at Westlake Chemical Partners]

Thanks. Thank you again for participating in today's call. We hope you'll join us for our next conference call to discuss our third quarter 2026 results.

[Operator]

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Participants

Executives

• Jeff Holy, VP and Chief Accounting Officer
• Jean Marc Gilson, President and CEO
• Steve Bender, Special Advisor to the President
• John Bochert, SVP and CFO