Executive Vice President and Chief Financial Officer at LyondellBasell Industries
Thank you, Bob. Good morning, everyone. Before I begin, I would like to share my sincere gratitude to Bob for his tireless work, inspirational energy and thought partnership in leading and growing LyondellBasell for nearly 12 years. We are all sad to see you go, Bob, but we will be eagerly watching your progress and wishing you continued success. Please turn to slide seven, and let me begin by highlighting our strong cash generation, which has been bolstered by our recent growth investments. In the third quarter, LyondellBasell generated a record $2.1 billion of cash from operating activities that contributed towards the $5.4 billion of cash generated over the last 12 months. Our free operating cash flow for the third quarter improved by more than 10% relative to the second quarter, and our free operating cash flow yield was 15% over the last 12 months. We expect this chart will continue to improve during the fourth quarter as 2020 results drop off from our trailing performance.
Let's turn to slide eight and review the details of our cash generation and deployment during the third quarter. As I have mentioned during previous calls, we are highly focused on shareholder returns. A strong and progressive dividend plays a fundamental role in our capital deployment strategy. In addition to our dividend, we also resumed share repurchases during the third quarter and reduced our share count by approximately one million. We continue to invest in maintenance and growth projects with more than $500 million in capital expenditures. Strong cash flows supported debt reduction of nearly $700 million, bringing our year-to-date debt reduction to $2.4 billion. We closed the third quarter with cash and liquid investments of $1.9 billion. In July, S&P Global Ratings recognized the improvement in our balance sheet by upgrading our credit ratings and indicating a stable outlook. During the fourth quarter, we expect that robust cash generation and an anticipated tax refund will enable continued progress on our goal to reduce debt by up to $4 billion during 2021, and further strengthen our investment-grade balance sheet. After the quarter closed, we repaid an additional $650 million of bonds in late October. We do not foresee the need for additional debt repayment in 2022. Confidence around our deleveraging targets enabled us to resume share repurchases in September, and we continued to opportunistically repurchase shares during October. As of October 22, we have repurchased a total of 1.6 million shares.
Now I would like to highlight the results for each of our segments on slide nine. In the third quarter of 2021, LyondellBasell's business portfolio delivered EBITDA of $2.7 billion. Our results reflect strong margins supported by robust demand for our products and tight market conditions, offset by higher costs, primarily in our O&P Europe, Asia, international segment and our I&D segment. Let's begin the individual segment discussions on slide 10 with the performance of our Olefins and Polyolefins - Americas segment. Robust demand drove EBITDA to about $1.6 billion, slightly lower than the second quarter. Olefins results decreased approximately $75 million compared to the second quarter due to lower margins and volumes. Despite relatively stable benchmark ethylene margins, our margins declined as we purchased ethylene to supplement production and meet strong derivative demand. Volumes decreased due to unplanned maintenance, resulting in a cracker operating rate of 89%. Polyolefins results increased more than $75 million during the third quarter as robust demand in tight markets drove spreads higher with polyolefin prices increasing slightly more than monomer prices. In fact, our polypropylene spreads reached a historic high. We continue to see strong demand for our products as we begin the fourth quarter. However, higher energy and feedstock costs, along with typical seasonality demand softness toward the end of the year are likely to compress margins for our O&P-Americas businesses.
Now please turn to slide 11 to review the performance of our Olefins and Polyolefins Europe, Asia, international segment. Higher feedstock cost and lower seasonal demand during summer holidays reduced margins and volumes in our EAI markets resulting in a third quarter EBITDA of $474 million, $234 million lower than the second quarter. Olefins results declined about $50 million as margins decreased driven by higher feedstock costs despite the higher ethylene and co-product prices. We operated our crackers at a rate of 92% of capacity due to planned maintenance. Combined polyolefin results decreased approximately $120 million compared to the prior quarter. Lower seasonal demand drove declines in polyolefin price spreads relative to monomer cost and reduced volumes. Declining polyolefin spreads also affected our joint venture equity income by about $35 million. During the fourth quarter, we expect to see further margin declines from higher energy and feedstock costs along with end-of-year seasonality. Our ethylene volumes are expected to decline due to planned maintenance.
Please turn to slide 12 as we take a look at our Intermediates and Derivatives segment. Rising feedstock and energy costs drove margin declines in most businesses resulted in third quarter EBITDA of $348 million, $248 million lower than the prior quarter. Results were impacted by approximately $25 million due to site closure costs associated with the exit of our ethanol business. Third quarter propylene oxide and derivatives results decreased about $15 million as margins declined slightly from the historical highs of the second quarter. Durable goods demand remained strong, resulting in increased volumes. Intermediate Chemicals results decreased approximately $140 million. Margins declined in most businesses, primarily styrene and volumes decreased as a result of downtime in our acetyls business. Oxyfuels and related products results decreased about $40 million as increased butane feedstock prices more than offset the increased volume from improved gasoline demand. In the fourth quarter, we expect volumes to increase with the restart of our La Porte acetyls facility and continued strength and demand for durable goods. Margins are likely to moderate with fourth quarter seasonality and higher raw material costs for our I&D segment.
Now let's move forward and review the results of our Advanced Polymer Solutions segment on slide 13. Customer supply chain constraints continue to hinge results with third quarter EBITDA of $121 million, $8 million lower than the second quarter. Compounding and solutions results were relatively unchanged. Margins were higher but partially offset by a decrease in volume due to restricted production in downstream markets, including the automotive sector, appliance manufacturing and other industries affected by semiconductor shortages. Advanced Polymer results decreased about $10 million driven by lower margins and volumes primarily due to plant maintenance. We expect results will be similar in the fourth quarter as it will likely take several quarters before supply chain constraints begin to improve.
Now let's turn to slide 14 and discuss the results of our Refining segment. Margins improved significantly in the third quarter, resulting in an EBITDA improvement of $122 million to a positive $41 million. In the third quarter, prices for byproducts increased, costs for renewable identification number credits, or RINs, decreased and the Maya 2-11 benchmark increased by $1.65 per barrel to $23.11 per barrel. The average crude throughput at the refinery increased to 260,000 barrels per day, an operating rate of 97%. Improved demand from increasing mobility should be supportive for our refining margins and could enable continued profitability during the fourth quarter.
Let's finish the segment discussion on slide 15 with the result of our Technology segment. Increased licensing revenue drove third quarter EBITDA to a record $155 million, $63 million higher than the prior quarter. We expect that fourth quarter profitability for our technology business will return to similar quarterly levels as the first half of this year based on the anticipated timing of licensing revenue and catalyst demand.
With that, I'll turn the call over to Bob.