Westlake Chemical Partners LP Q2 FY2025 earnings call

• Second quarter sales and earnings benefited from fewer production days impacted by the planned turnaround at the Petro 1 ethylene unit. • The stability of Westlake Partners' business model is demonstrated by the fixed margin ethylene sales agreement, minimizing market volatility. • Second quarter net income for Westlake Partners was essentially in line with Q2 2024. • Announced a quarterly distribution of $0.4714 per unit for Q2 2025, with 44 consecutive quarterly distributions since IPO in 2014. • Successful completion of the Petro 1 turnaround in Q2 2025 positions the Partnership for solid earnings and distributable cash flows going forward. • Predictable fee-based cash flow is beneficial in the current economic environment, with a cumulative distribution coverage ratio of approximately 1.1x since IPO.

Westlake Partners' second quarter 2025 net income was $15 million or $0.41 per unit. Consolidated net income including OpCo's earnings was $86 million, which included a $14 million benefit to OpCo from the ethylene sales agreement. Distributable cash flow was $15 million or $0.43 per unit for Q2 2025, a decrease of $2 million compared to Q2 2024 due to higher maintenance capital expenditures from the Petro 1 turnaround. At the end of Q2, consolidated cash balance and cash investments with Westlake were $81 million. Long-term debt was $400 million, with a consolidated leverage ratio of approximately 1x.

• Global industrial and manufacturing activity has been soft in 2025, broadly impacting the chemical industry, but the Partnership's financial performance and distributions are supported by the ethylene sales agreement. • Evaluating 4 levers of growth: increasing ownership interest of OpCo, acquiring other qualified income streams, organic growth opportunities like expanding ethylene facilities, and negotiating a higher fixed margin in the ethylene sales agreement.

Q: You mentioned on the Westlake C Corp call that some outage impact from Q2 might be persisting into Q3. Would any of that outage impact affect the OpCo assets, the crackers specifically? And could you talk about how those assets have been running so far in Q3?

A: Yes, the impact we were speaking to did not affect the ethylene unit here. The Petro 1 unit was completed in Q2, and it is running very reliably and producing as expected after the turnaround.

Q: You mentioned the 4 levers of possible growth. Are there certain opportunities that look more appealing in the current environment? Certain levers that look less appealing? And how likely do you think it would be that Westlake LP would see some sort of distribution growth either in the back half of 2025 or into 2026?

A: Going back to the origination of the Partnership, it was designed to fund the C Corp at attractive yields. Today, Westlake Corporation doesn't have an immediate need for capital. Given the contraction in markets and the lack of immediate need for Westlake Corporation to attract equity capital, I don't see a need in the current year to raise equity capital through one of these 4 levers, so no immediate distribution growth expected in the current year