利安德巴塞爾 (LYB) 2014 Q4 法說會逐字稿

Hello, and welcome to the LyondellBasell Teleconference. At the request of LyondellBasell, this conference is being recorded for instant replay purposes. Following today's presentation, we will conduct a question-and-answer session. (Operator Instructions) I'd now like to turn the conference over to Mr. Doug Pike, Vice President, Investor Relations. Sir, you may begin.

Thanks, Joan. Welcome to LyondellBasell's Fourth Quarter 2014 teleconference. And I'm joined today by Bob Patel, our CEO; Karyn Ovelmen, our CFO; and Sergey Vasnetsov, our Senior Vice President of Strategic Planning and Transactions.

Before we begin the business discussion, I'd like to point out that a slide presentation accompanies today's call is available on our website at www.lyb.com. I'd also like for you to note that the statements made in this call relating to matters that are not historical facts are forward-looking statement. These forward-looking statements are based upon assumptions of management, which are believed to be reasonable at the time made; they are subject to significant risks and uncertainties, and actual results could differ materially from those forward-looking statements. And for more detailed information about the factors that could cause our actual results to differ materially, please refer to the cautionary statements in the presentation slides and our financial reports, which are available at www.lyb.com/investorrelations.

The reconciliations of non-GAAP financial measures to GAAP financial measures, together with any other applicable disclosures, including the earnings release, are currently available at our website, www.lyb.com.

Now, finally, I'd like to point out that a recording of this call will be available by telephone beginning at 2 p.m. Eastern time today until 11 p.m. Eastern time on March 3 by calling 866-407-9260 in the United States and 203-369-0614 outside of United States, and passcode for both numbers is 4558.

During today's call, we will focus on fourth quarter and full-year 2014 performance, the current environment and the near-term outlook. But before turning the call over to Bob, I'd like to call your attention to the non-cash lower cost and market inventory adjustment that we recognized during the fourth quarter. This charge is driven by the use of LIFO accounting, our 2010 fresh start accounting as we entered the public markets, and the recent declines in pricing for many of our raw materials and finished goods inventories. And Karyn will discuss that adjustment later in the call, but the comments made on this call will be in regard to our underlying business results, excluding the impact of this LCM inventory charge. With that being said, I'd now like to turn the call over to Bob.

Thanks, Doug. Good morning to all of you and thank you for joining our earnings call. I'm pleased to be here today conducting my first earnings call as the CEO of LyondellBasell. I'm truly honored to serve all our stakeholders and am excited about what the future holds for our great Company. I joined LyondellBasell five years ago in order to be part of a team that would deliver one of this industry's great transformations and [again the outgoing] leadership we've put in place a strong work ethic, basic philosophy and a solid foundation. I'm grateful for his support and mentorship over the past five years.

I am also grateful for the hard work and support of all my colleagues at LyondellBasell. We are enormously proud of what we've accomplished together thus far. We have an excellent safety record, world-class assets, outstanding operational efficiency, a strong balance sheet and exciting growth projects underway. It's my vision to build on this success and ensure LyondellBasell continues to deliver the highest-quality products to our customers and peer-leading value to our shareholders.

I'm taking over as CEO of a company that is well positioned to excel under all circumstances. This Company has an excellent foundation upon which we will build. I'll talk more at the end of this call about my approach, philosophy and strategy, but for now, I would like to discuss the 2014 results.

As Doug mentioned at the start of this call, a set of presentation slides accompany the call and is available on our website. Let's take a look at slide number 4 and review a few financial highlights. The fourth quarter set a record for the period and marked the third consecutive quarter of record results, with EBITDA of $2.1 billion and earnings per share of $2.48.

Our EBITDA results were $578 million higher when compared to the fourth quarter of 2013. Our annual results also set a new record. For the year, our income from continuing operations was $4.7 billion or $8.92 per share. The charts on the bottom of the page highlight the strength of our earnings and the annual growth realized over the past several years.

Within our portfolio, the fundamental drivers of our performance were unchanged. Both the Olefins/Polyolefins - Americas and EAI segments again achieved record results in 2014. The Intermediates and Derivatives segment continued to be a strong, stable performer, generating approximately $1.5 billion of EBITDA in each of the past three years. Our Refining segment EBITDA more than doubled, and the Technology segment continued to generate steady and strong earnings.

I'll speak more about the performance of each segment later in the call, but I first want to highlight a few of our 2014 accomplishments.

If you turn to slide number 5 of the presentation, I'll begin with environmental, health and safety performance. Those of you who have followed us know about our commitment in this area. I want to assure you that under my leadership, LyondellBasell's focus on environmental, health and safety performance will not change. This has been and will remain our first priority. Our outstanding track record can be seen in these charts. As they were last year, our results are consistent with top and solid performance. Over a five-year period, our total recordable incident rate is down approximately 50%, and our environmental and process safety incident rates have declined by approximately two-thirds. While these numbers represent good progress, they are not zero, which is our ultimate objective. Performance in this area protect our people, our assets in the community in which we operate. We'll continue to strive for perfection and this will remain our number one focus and priority.

Turning to slide number 6, we have outlined some of our key financial and operating accomplishments. First, let's cover our financial accomplishments. OpEx during 2014 surpassed last year's record earnings. We generated $6 billion in cash flow from operations, while returning $7.2 billion to shareholders through share repurchases and dividends. We purchased more than 63 million shares and increased our dividend by 17%. Our finance team took advantage of a favorable lending market by issuing $1 billion in 30-year bonds at favorable rates, and we initiated a commercial paper program.

Turning to operating accomplishments, you will note our outstanding operating rates. The US ethylene operating rate remains near our nameplate capacity for the third consecutive year, when normalized for the La Porte turnaround and expansion. Our European ethylene operating rate of 95% was 12 percentage points higher than the industry average. Our propylene oxide and refinery rates also improved year-over-year. In addition to our excellent operating rates, we increased our feedstock flexibility, enabling more production from advantaged feedstocks.

In 2014, approximately 90% of our US ethylene production was sourced from NGLs, and approximately 53% of our European ethylene production came from advantaged feeds. At our refinery, approximately 10% to 15% of our production was sourced from lower-cost Canadian crude; and during the second half of the year, the refinery operated at 99% of capacity. As you know, we've always emphasized cost control.

For the sixth consecutive year, we offset inflation and maintained flat underlying fixed costs. During 2014, we executed on our growth program. In addition to operating the Channelview methanol plant for the full year following its restart, at the end of 2013, we delivered two significant growth projects. The first major ethylene expansion in our growth program was completed as La Porte [failed] last summer. This project brought online an additional 800 million pounds of annual ethylene capacity. We also commissioned an additional 200 million pound of polyethylene capacity at our Matagorda site. Together, these projects contributed approximately $80 million to 2014 EBITDA. During 2015, we expect to realize a full-year benefit from both projects.

Along with completing these projects, we began construction on two other ethylene expansions in the US and we are actively developing another. We also announced that we are in the process of developing plans for our new propylene oxide plant.

Slide number 7 summarizes the impact of our growth program. Overall, we will increase our US ethylene capacity by 25% and grow global propylene oxide capacity by approximately 35%.

Let's turn to slide number 8 and look at some of the metrics and go-live performance in 2014. Of the top of the page, [we brought] our key volumes. I want to focus your attention on our ethylene production. Over the past several years, our cracker operations have been strong and we've been able to operate in both regions above industry average rates. Our US data represents production after operation of our flex unit which converts ethylene into propylene. Taking into account this ethylene consumption and our planned turnaround downtime, our US crackers again operated near our nameplate capacity of approximately 10 billion pounds.

In Europe, our crackers operated at 95% of nameplate capacity, a new record for those facilities. In charts along the bottom of the page, you see a summary of product margin-based spreads. The indexed charts represent our internal data, while the others represent industry benchmarks. The charts on the left highlight the strength of the US ethylene chain and our outperformance in Europe, as we increased feedstock flexibility and operating rates during 2013 and 2014.

On the right-hand side, we have plotted MTBE and refining industry spreads. MTBE continued to deliver solid spreads during 2014. In refining, the industry Maya 2-1-1 spreads have all fairly steady, while we have pursued internal improvements in our operation and flexibility to adjust to a changing crude oil environment. Overall, these charts provide a good perspective of the margin and volume factors that helped to generate record earnings during 2014 and in each of the last three years. Perhaps most important, we captured the value that a strong market afforded through our solid operations and advantaged feedstock positions.

I'd like to now turn the call over to Karyn to discuss our financial performance.

Thanks, Bob. Before I review our cash performance, I thought I should help to understand the lower cost to market inventory adjustment or LCM as it is somewhat unique to [our businesses]. Please turn to slide number 9. This simplified chart has been added to help ascribe the reason for the non-cash LCM adjustment. This adjustment impacted our reported EBITDA numbers in the fourth quarter by $715 million and by $760 million for the full year. While this may be unique to us, and that's highlighted by our competitors, it must be remembered that we use LIFO accounting and our balance sheet was established during mid-2010 when we re-entered the public markets. It was at this time that our inventory was valued at market prices.

Crude oil was approximately $85 and natural gas was at $4 per MmBTU. In the rate, we have included industry prices for a few key raw materials and products. In the graph, you will see that at the end of each of the subsequent years, crude oil remained higher than $85 price in 2010. (inaudible) market value of our total inventory was (inaudible) in excess of the 2010 value. With the rapid decline of crude oil, of the raw materials and some finished goods pricing during the second half of 2014, GAAP accounting requires us to adjust the value of the inventory held in our balance sheets to lower market prices. This is what has generated the large non-cash inventory adjustment. You can see in the tables, there have been further declines in both raw materials and products during January. If these conditions persist, we would expect to record additional LCM adjustments during the first quarter.

Please turn to slide number 10. As Bob already mentioned, this has been a record-setting year for both EBITDA and operating income. Olefins and Polyolefins - Americas' EBITDA reached nearly $4.2 billion for the year, averaging more than $1 billion per quarter. Olefins and Polyolefins EAI's exceeded $1.4 billion for the year, a mark that seemed very faraway just a few years ago. This performance was driven by our differentiated position and internal actions with the European Olefins and Polyolefins businesses.

Intermediates and Derivatives continued to deliver stability to the portfolio and segment earnings were up approximately 4% versus 2013. While we are often focused on the results of Olefins and Polyolefins - Americas given its size, it is important to note that Olefins and Polyolefins EAI and Intermediates and Derivatives together generated EBITDA totaling nearly $3 billion. This is particularly impactful as only $432 million of capital was needed to support the operations, resulting in excellent cash flow. Refining also contributed as EBITDA more than doubled from a very difficult 2013.

Please turn to slide number 11, which provides a picture of our cash generation [and needs]. During 2014, we generated $6 billion of cash from operations. We also took advantage of favorable interest rates and borrowed $1 billion at an average coupon rate of 4.875%. Our commercial paper borrowings ended the year at $262 million. The cash and short-term security balance ended the year at $3 billion.

On slide 12, you can see the $6 billion in cash from operations. This is $1.2 billion higher than 2013. This cash generation has allowed us great flexibility. We [recorded] capital expenditures at approximately $1.5 billion during 2014, allowing us to progress our growth projects. We've also continued our commitment to return cash to our shareholders and you can see the significant step forward that was made during 2014.

During the last 12 months, we have returned $7.2 billion to our shareholders, repurchasing over 63 million shares in the process. During the past four years, we have paid dividends of $7.8 billion and devoted $7.7 billion to share repurchase. To date, we have repurchased approximately 91 million shares since the share repurchase program began in 2013. This equates to approx. 16% of the total shares outstanding at the time the program was initiated.

As you may recall, we are authorized to purchase up to 10% of our shares before the end of October 2015. Year-end, we had ample cash to acquire the remaining 20 million shares under this authorization. Continue to remain committed to returning cash to shareholders. There has been no change to our capital deployment or our financial policies in this regard.

So as this is the beginning of the year, it is that time where I address some of your 2015 modeling questions.

Regarding capital, we are currently planning to spend approximately $1.6 billion during 2015. This spending level progresses with our base maintenance and growth programs. Approximately 40% is turned (inaudible) through 2015 major projects include turnarounds at the refinery, few propylene oxide facilities and a challenging methanol. Majority of the growth spending will be divided between the Channelview and Corpus Christi ethylene expansions. Channelview expansion should be online during the second quarter and Corpus Christi is now expected to begin production during the second quarter of 2016, following our first quarter turnaround.

Our cash interest expense is expected to be approximately $360 million based on $6.8 billion of long-term debt and average interest rate of approximately 5.3%. We also expect $10 million of interest on our short-term facilities as well as an estimated $4 million per quarter of non-cash amortization. During 2014, we executed $2 billion of fixed to floating interest rate swaps and $2 billion of dollar to euro cross-currency swaps. At year-end 2014 conditions, we expect these positions to reduce our interest expense by roughly $60 million in 2015, while (inaudible) will fluctuate with annoying movements in interest and currency rates. So important, we tend to optimize our interest rate risks through the use of interest rate swaps.

We also expect to continue our short-term investment strategy which is based on ensuring the safety and preservation of our invested funds. This strategy provided over $30 million in interest income in 2014. However, this [loan can] change depending on the level of interest rates and client cash that is divested. In your book, depreciation and amortization should be approximately $1.2 billion during 2015. We plan to make regular pension contributions that total approximately $110 million and estimated pension expense of approximately $55 million. Currently expect a 2015 effective tax rate of approximately 26%. The cash tax rate is expected to be somewhat lower.

With that, I will turn things back to Bob for further discussions of our business results.

Thanks, Karyn. As mentioned previously, my discussion of business results will be in regard to our underlying business results, excluding the impact of this LCM inventory charge. Let's discuss segment performance mainly on slide number 13 with Olefins and Polyolefins - Americas. Excluding the LCM charge, fourth quarter EBITDA was $1.3 billion, $72 million greater than the third quarter. For the full year, segment EBITDA was $4.2 billion, an outstanding year.

Relative to the third quarter, ethylene margins were unchanged. The decline in pricing of approximately $0.06 per pound was offset by a lower cost of ethylene production. Our operating rates remained strong during the quarter, averaging 97%.

The additional La Porte capacity was fully online during the quarter and operated nearly at near full capacity. 73% of our production was from ethane and 88% came from NGLs. The differential between ethylene and propylene prices allowed us to profitably operate our flex unit throughout the quarter. This added approximately $19 million to our results.

In Polyolefins, our polyethylene spread expanded by approximately $0.04 a pound, while the polypropylene spread moved up approximately $0.01 per pound. Polyethylene volumes decreased by approximately 6%. Polypropylene experienced a sales volume decline of approximately 14%, due to holiday slowdowns and some late December customer destocking. For the full year, results surpassed 2013 by $617 million, primarily due to higher olefins and polyethylene results. Olefin results benefited from higher prices due to tight industry supply for much of the year as well as a lower cost of ethylene. Polyolefin's results showed the greatest improvement, increasing $530 million versus the prior year [SPE] volume and spread over ethylene improved significantly.

Overall, 2014 was an excellent year. Industry fundamentals were strong, our crackers continued to operate reliably near nameplate capacity when normalized for the La Porte turnaround. We also completed the La Porte ethylene expansion and began realizing the financial benefits of that production. In January, ethylene margins have come off their record-highs as prices in the market have followed crude oil lower. We continue to see natural gas prices below $3 per million BTU and NGL prices have been weak as inventories have reached record-high levels.

Let's turn to slide number 14 and review performance in the Olefins and Polyolefins, Europe, Asia and International segment. During the fourth quarter, underlying EBITDA was $392 million or $49 million higher than the third quarter. For the full year, underlying EBITDA was $1.4 billion, a $571 million increase versus 2013. Olefins results increased versus the third quarter by approximately $70 million, as a result of lower cost of naphtha more than offset declining ethylene prices. Polyolefin results decreased on lower volume as sales decreased approximately 3% to 4%. Our polypropylene compounding and polybutene-1 business results modestly declined due to lower sales volumes.

Seasonal declines of this magnitude are typical in polyolefin, polybutene-1 and polypropylene compounds. Equity income from JVs was relatively unchanged. For the full year, segment results increased by $571 million. Olefins results increased by approximately $260 million. This increase is largely the result of lower cost of ethylene as a result of lower naphtha cost, increased advantaged feedstock processing and higher production.

We operated our crackers at 95%, approximately 12 percentage points higher than industry rates. The benefit associated from running advantaged feeds totaled approximately $220 million. Our polyolefin results increased approximately $235 million year-on-year, reflecting improved spreads and higher volume in polyethylene. Polypropylene compounding and polybutene-1 results were relatively unchanged versus 2013. Equity income from our joint ventures increased by $55 million. 2014 also benefited from a $52 million environmental settlement that was recognized during the first quarter, while 2013 benefited from a $25 million insurance settlement. 2014 was a record year for the O&P EAI segment.

We are realizing significantly better results following the challenging few years of restructuring and difficult market conditions. Having worked with this team over the last four years, I'm very proud of their accomplishments. Their value-oriented approach to markets, focus on feedstock flexibility and restructuring activities have enabled this performance improvement, surpassing $1.4 billion of EBITDA is an achievement worth calling out.

During January, prices continued to adjust to a changing raw material environment. January orders are in line with normal order activity and our margins and operating rates have been resilient. JV-related earnings are anticipated to moderate, consistent with lower global polyolefin prices. Now, please turn to slide number 15 for a discussion of our intermediates and derivatives segment.

Fourth quarter EBITDA was $364 million, a decline from the third quarter of $19 million. For the full year, the segment generated EBITDA of nearly $1.6 billion and $60 million more than 2013. The quarterly decline was attributable to lower propylene oxide and derivatives, following a strong third quarter. In our Intermediate Chemicals business, EBITDA increased approximately $10 million, as strength in our styrene results from declining benzene more than offset a decline in C4 chemicals resulting from seasonal impacts and schedule maintenance.

Acetyl results were relatively unchanged and oxyfuel results were lower by approximately $10 million. The impact of lower gasoline prices and these typical seasonal declines were partially offset by tight oxyfuel market, declining raw material costs, and strong octane premiums during October and November.

The full-year 2014 increase versus 2013 reflects strength and stability in our propylene oxide business and increased contribution from our expanded methanol business. You will recall that the methanol [asset at] Channelview was restarted during December 2013. While this asset has not run to LyondellBasell's standards, it did contribute to our earnings and remained the sound investment for the segment. The Channelview methanol plant ran at 68% utilization rate during 2014 and was the primary driver of $175 million EBITDA improvement in the oxyfuel business.

Oxyfuel results decreased by approximately $30 million versus 2013. Volume and product mix were the primary drivers. Higher gasoline and octane premiums helped support the business for most of the year. The New Year has started with little change in propylene oxide market as the supply and demand fundamentals have remained strong. Oxyfuel prices have moderated, as crude oil and gasoline prices continue to decline. However, spreads are in line with seasonal norms. Methanol prices have also come under some pressure. During the first quarter, we will be conducting scheduled maintenance on the Channelview methanol plant. Based on January margins, we estimate that this will impact segment results by approximately $20 million versus production at full rates.

Let's move to slide number 16 for a discussion of the Refining segment. Fourth quarter EBITDA was $33 million, a decline of $77 million from the prior quarter. For the full year, the segment generated $409 million of EBITDA, an increase of $227 million versus 2013. During the fourth quarter, the Maya 2-1-1 spreads averaged $17.72 per barrel and crude throughput averaged 266,000 barrels per day at our refinery. Spreads at the refinery declined less than the nearly $7 decline in the Maya 2-1-1. The lower Maya spread was primarily driven by gasoline. The refinery benefited as the negative spread between secondary product values and crude oil price declined.

The cost of RINs during the quarter were relatively unchanged from the third quarter. 2014 saw an improvement in the refining segment. Crude throughput averaged 259,000 barrels per day, up 27,000 barrels from 2013. 2013 included a turnaround on a crude unit and a coker. The Maya 2-1-1 benchmark increased by approximately $1.50 per barrel to average $24 per barrel and cost of RINs decreased by approximately $20 million during the year. Thus far in 2015, the Maya 2-1-1 spread averaged approximately $19 per barrel. There are no major maintenance planned at our refinery during the first quarter. We received our initial shipments of Canadian crude through the Enbridge Flanagan South Pipeline system late during the fourth quarter. [Each] volume should increase across the first quarter.

Turning to slide number 17, let's step back from the details and think about the business environment more broadly. Overall, the fourth quarter and 2014 were record periods. While margins at ease, our positions remain advantaged. Importantly, we continue to generate strong earnings and cash flow. The start of the new year begin the new chapter in the life of LyondellBasell. We're always in the new chapter and many teams will sound familiar.

First, we'll always be committed to safe and reliable operations. Safety is our first priority and is a part of our core values as evidenced by our top-decile safety performance. We will also continue to pursue operational excellence, focusing on running our world-class assets reliably and efficiently.

During 2015, we should benefit from the increased production and report. We anticipate the completion of the expansion at Channelview and new volumes beginning in the second quarter. We also expect improved operating rates from the Channelview methanol unit in 2015, following the first quarter maintenance. Cost management will continue to be part of our everyday operations. I believe that our fixed costs should not vary depending on the business cycle. Our structure and resources are designed to function well under a range of industry conditions. Our costs did not escalate during good times and we don't expect them to vary much in difficult times. We've built the Company to deliver differential results for our shareholders in all business climates. My goal is to leverage a strong foundation and build upon it. While we anticipate that US ethylene margin will ease from record 2014 levels, consistent with lower oil and gas prices, they've remained relatively strong. In fact, IHS estimates current ethylene margins to remain above $0.25 per pound.

Our business continues to generate significant discretionary cash over and above our capital program and dividends. The returns in our growth program continue to be excellent and our projects are generating earnings to date. We've greatly reduced our share count and continue to repurchase shares. Furthermore, we continue to maintain a strong balance sheet, allowing us to pursue both our expansion plans and other opportunities, if and when the timing is right. I look forward to leading this team into 2015 and beyond, as we continue to build momentum across the Company.

Before we open the line for questions, I wanted to make you aware of our upcoming Investor Day. Our executive team will be conducting this session on April 29 in New York. We are tentatively planning for the meeting to occur between 8 AM and 1 PM. We will be finalizing the details and will notify you of the location in the coming weeks. Please try and join us for the event. We are now pleased to take your questions.

(Operator Instructions). P.J. Juvekar, Citi.

Thank you. And Bob, congratulations on your new position.

Thank you, P.J. Good morning.

Good morning. And as you make your mark on the Company, would like to know how do you think about buy versus build decisions? And what I mean by that is , you can build a new plant or expand an existing plant or in buying, you can buy your existing businesses or in some adjacencies? So just sort of take a step back and tell us how do you think about all the decisions?

Well, P.J., when I think about buy versus build, you really have to step back and look at free cash flow deployment. So, how do we think about our free cash flow deployment and our balance sheet? First of all, our priorities are to maintain our existing assets in top condition. So our maintenance capital is of high priority to us. Then, our current dividend is also a priority. Beyond that, our focus has been in the past is to have a stable and growing regular dividend, to have a good focus on growth CapEx to the extent that we still have opportunities. And then, share repurchases. We still see our shares as being a compelling value. We still see the ethane advantage as being alive and well, and we see a bright future for our Company. In terms of M&A, M&A competes with all of these other priorities and we'll continue to evaluate all of our options as we carry forward the strategy of our Company.

Thank you. And then, secondly, there were a lot of talk about ethane exports and capital being deployed there. With the recent change in the energy complex, how do you see exports of NGLs or exports of raw materials out of the US? Thank you.

Well, exports of ethane is probably a little bit different than exports of propane and butane. At today's crude oil price, ethane exports look less attractive but over the long run, as we've mentioned in prior calls that there are crackers in Europe and perhaps some in Asia we're uniquely placed to import ethane and benefit from those imports. We don't expect this to be a very broad sort of program. It's specific for a few crackers. In the case of propane, propane exports have been increasing, but here in the US, we still see a significant amount of propane supply and ethane supply. Ethane rejection levels today are 300,000 to 400,000 barrels per day. So while ethane exports and NGL exports in general will be persistent in the market, we don't expect those to change the outlook of the US ethylene advantage.

Thank you.

John McNulty, Credit Suisse.

Yes. Good morning. Thanks for taking my question and again congratulations on the new role. When I look at Lyondell, we see you're at levels where you are industry leader in terms of profitability, you're industry leader in terms of safety levels; and yet, in some of the opening comments and in the release, you had indicated you want to take the Company to the next level. So I guess I'm wondering how do you think about what the next level is, whether it's more cash to shareholders or M&A or new platforms being added on. I guess how should we be thinking about what the next level is in your mind?

Well, thanks, John. First of all, when I think about what gets us to the next level, our focus has to be in the near term on running what we have today as well as we possibly can. That enables the generation of free cash flow, which affords us then the opportunity to think about the other items you mentioned and I'm just in the job here less than 30 days, and we are going to build out our strategy, we're going to work with the Board to discuss an array of options, organic growth, other growth options that may be available to us, we'll develop that over time, but we do see share repurchases as being a continued focus or likely to ask our shareholders to approve another share repurchase program after this one had run its course in May-June. So share repurchases will continue to be something that you'll see from us. In addition to that, we'll build out our strategy and think about other ways to take the the Company to the new level.

Great, thanks for the color. And then, I guess the second question, you indicated as far as your fixed costs go, you don't really see that changing all that much and I guess, when we look and we see crude prices getting cut in half and commodity prices rolling over, I guess are there things that you or Lyondell can do to help to weather this, like are there actions that we should be thinking about that you'll be taking going forward or is it pretty much you're going to live and die by to some degree what the commodity prices actually do?

Well, first of all, I would remind you that we've gone through a fairly significant cost reduction program following 2009 and 2010, I can tell you that the culture of our Company is we don't wait for a crisis to change our costs. We manage our costs tightly in good times and in bad times and while we don't have a program that we're running through the Company at the moment, we have opportunities to incrementally improve our cost structure, whether it's in staff groups or in specific sites or in specific businesses, those are things that we pursue every day and we'll continue to do that. For the rest, our job is to be nimble from a commercial standpoint as these markets are dynamic and continue to run our assets as reliably and safely as possible. We think that that's our formula and it has been affected and will be affected in the future.

Great. Thanks very much.

Jeff Zekauskas, JPMC.

Hi, good morning. I was wondering, Bob, over the next five years, what do you think is the probability that Lyondell might make a significant acquisition, either to go downstream or to complement its upstream operations?

Well, Jeff, that's a good question. I want to make sure I don't get out ahead of my Board and ahead of the team that works together with me here at LyondellBasell. But certainly, we are going to build out our strategy, we are going to continue the evolution of our Company. If you think about where we've come from, we've gone from a company that was really focused on day-to-day survival in 2009 and 2010 to a company that got its cost structure right and are put in place incredibly strong operating discipline, which enable the free cash flow that we enjoy today. We've reached the benefits of internal organic growth opportunities. We still have many ahead of us which we simply can't lead our focus on those. We have some fairly big projects that are underway. And then, of course, as we mine those, we will then think about the next steps in terms of strategy. So you will hear more from us as time goes on and we will share a bit more with you when we come up to New York for our Investor Day. But, think of us going through an evolution as most companies go through and we've come a long way and I think we have a long way to go.

Thank you. And sir, my followup, the price of oil has been bouncing around between $45 and $55 a barrel on a Brent basis, and if you go back in time, maybe back to the 2008-2009 recession, the North American ethylene price holds in the high 20s rather than in the high 30s. And of course, ethylene can always fluctuate with oil though directionally, it goes with it. Do you have any thoughts on why ethylene is as high as it is given the current Brent price?

No, generally, in our markets, Jeff, the cost part of the equation tends to fall faster than the price part of the equation. Having said that, supply demand has a lot to do with how fast and how dynamic prices move. Today, operating rates are relatively high all over the world and when we think about inventories in the value chain, they're relatively low. Crude price has been dropping for the better part of 60 days. Based on our past experience from 2008 and 2009, all the participants in the value chain have a propensity to reduce inventory quickly with the values every day. We think that's kind of run its course.

As we sit here today in January, and as crude oil prices perhaps stabilize and there is an indication of a bottom, likely we are going to see some inventory replenishment and we're going to see a seasonal uptick in demand, as we move into March, April, May timeframe, and I think all of those factors point to a net positive picture from a demand standpoint. Operating rates are reasonably good. So that's why perhaps you haven't seen the kind of impact on ethylene price, and the other thing I would say is that the price of ethane is more tied to gas than it is to oil. So here, as I mentioned earlier, the ethane supply-demand indicates that there is an abundance of ethane and rejection levels have reached as high as 400,000 barrels a day. So, there is plenty of ethane, there is lots of propane here to compete with ethane to get into the cracker; and frankly, we don't see that changing in the near term.

Okay. Thank you so much.

Bob Koort, Goldman Sachs.

Thanks. And welcome back to Houston, I guess you're a month into the job, you're one of the top three performing chemical stocks, so you're setting a pretty good precedent. A couple of questions for you. One, I think you guys have said in aggregate, you're going to add maybe 2 billion pounds to your US ethylene capacity and maybe 1 billion pounds of polyethylene. I'm just curious what your approach is to being a merchant seller or how you view being long or short, olefins versus polyolefins, as we looked all the capacity additions that are coming in the industry over the next three of four years.

Bob, we are a significant merchant player today and will likely be a merchant player in the future in the ethylene market. From our expansions in terms of ethylene, so we've got the La Porte one up and running at $800 million. We have the next Channelview expansion in Q2 of 2015. We have Corpus Christi in Q2 of 2016 and then another Channelview expansion in 2017. In total, we'll add 2.3 billion to 2.4 billion pounds. A part of that is to fully support the assets we have on the ground today. You have to remember, we also have a flex unit which produces propylene which consumes a significant amount of ethylene. So our options in terms of future integration of ethylene, we could build more polyethylene, we could build another flex unit, we continue to evaluate those options, but I do expect us to be a reasonable-sized merchant seller of ethylene as well. And so with those three options, I think we have a reasonable amount of potential to place some new ethylene that will come online.

And if I might ask another sort of longer-term question. I was at a presentation yesterday by one of your soon-to-be-new polyethylene competitors, and I talked about maybe placing two-thirds of their polyethylene output into the export markets which will be a dramatic increase from the breaks of the US exports today, what's your sense on volatility of the industry as all these new units come on over the next few years and the need to export and rely more on the export markets for offtakers? Is that something that creates a greater risk or what's your sense of how it might develop?

I'm not sure of [how it presents] risk. If you sit back and look at the supply-demand outlook for ethylene globally, the US is really the only region that's adding significant amount of ethylene capacity. You don't see a lot of this in Asia. Asia is more focused on coal-based propylene or PVH-based propylene. There are some (inaudible) but not significant. In Europe, there are many expansions. So if you think about global demand growth of ethylene and you think about the amount of ethylene expansion here in the US, the two match up relatively nicely and so we don't have the Middle East adding ethane-based ethylene production. We do have some mixed feed crackers there that are planned with [Cedar] being one of them, but I really see America as being the next exporter of ethylene to support global demand growth. And therefore, ethane prices will equilibrate to kind of international arbitrage and the product will be placed. So it's only natural that more product will be exported to meet the demands for the rest of the world.

Great and that's helpful. Thank you.

Arun Viswanathan, RBC Capital Markets.

Thanks for taking my question and congrats on a great year and to move some international office problem as well to you. I guess my first question was on polyethylene and polypropylene, you mentioned some late December destocking in polyolefins. Is it your sense that some of that has run its course that you mentioned that as well and what's your outlook I guess for the next six months or so on how that continues?

Thanks, Arun, for your kind words. In terms of the inventory downstream, I think that across the world, whether you talk about Asia or Europe or US, the inventory in the value chain is on the low end of a normal range. And I think buyers are looking for signs of a bottom in prices and in crude oil. And as I mentioned earlier, if you think about some level of restocking coupled with a seasonal uptick in demand going into the next few months, I am relatively bullish about the demand outlook globally on polyolefins and I think that will carry its way through to at least June.

Okay, thanks. And I guess my next question is on your cash flow in the balance sheet, first off, do you expect a working capital benefit in 2015? And then, on your buybacks, you mentioned that in past conversations that you'd consider repurchasing up to 10% of your shares, is that still something you're considering and cash flow is lower, would you use commercial paper or other sources to make that happen? Thanks.

With regards to the working capital, we do expect to see kind of the continuing trend in terms of pricing and (inaudible) we see our receivables coming down faster than our payables and so we do expect to see somewhat consistent trend there as we head into first quarter. With regards to the next 10%, whilst we say there is completely the existing 10% cash that we're working through right now by May and as Bob indicated, our expectation is that we would our authorization coming from the shareholders the next shareholders meeting for another 10%.

And in terms of funding that, we have consistently been using the balance sheet. We have been releasing debt as well as using discretionary cash flow under working capital, [work] CapEx and our dividend needs to fund that program. We have always said we wanted to season into this investment-grade space and for this strong BBB. We have been doing that and we are aware that there is opportunities there, if indeed we need to fund the next tranche and supplement that with our free cash flow as we go through the next 12 months or so.

Okay, great. Thank you.

Vincent Andrews, Morgan Stanley.

Thank you and good morning, everyone. Probably I might ask a bit on the demand side of the equation. The GDP multiplier for ethylene has kind of been stuck around one, it's probably below one for kind of the post financial crisis period. In prior times we think of lower oil prices and lower plastics prices, the multiplier has been higher. What is your view on demand, if we're going to stay lower oil prices and consequently lower plastics prices and I guess, the second part of the question would be do you think it's possible that demand drives us into a ethylene sort of upcycle, a supercycle, if you will?

Well, from a demand standpoint, Vincent, I think net we should think about demand improving based on lower oil price and as emerging markets continue to consume more polyolefins per person. So those trends, I think are still in place. I'm not sure if I am ready to declare some sort of supercycle at this point, but I do think demand will improve incrementally. And let me again, I would point you to especially in polyethylene or ethylene and derivatives, look and see how much new capacity is coming outside of the US and there is not that much. So, we could see reasonably high operating rates over a longer period of time. But we'll have to watch all this and see how demand evolves.

Okay. Thanks very much.

David Begleiter, Deutsche Bank.

Thank you and Bob, congratulations as well. Bob, just on your ability to crack propane, butane in the Unites States, I always thought you may have cracked actually more in Q4 than you actually did. Can you talk about why that was the case and potential going forward for increasing your propane and butane crack?

Thanks, Dave. What we're known for here in the US is our feedstock flexibility. And so we can crack ethane, propane, butane; we can even crack heavy liquids, but as we've changed our cracker profile over the past -- our cracking profile over the past three, four years. We've not given up a lot of our flexibility, but what part of that does is, we can't crack a lot of any one thing, but it's -- if you look at where relative propane and ethane prices have been, we've been able to capture the value of the NGL barrel being advantaged. And so I don't think that's held us back. We might have some competitors who can crack a lot more propane than we can, but I would tell you that we have industry-leading flexibility, which I think will serve us well over the long run.

Very good. And just on the refinery, Bob, can you give us your thoughts or philosophy on how that business fits into Lyondell in the near, medium or longer term?

Well, when I think about more broadly any of our assets, I expect that every asset should realize its full potential. You've got to run well and the refinery has certainly made great strides in that area. They have to outperform their peers and our refinery has made progress in this area as well and more to go. We've identified many more improvement areas and Kevin and his team are working diligently to realize their potential. Lastly, all of our businesses at a minimum have to generate positive cash flow and the refinery is doing that. And looking forward, we see some potential upside form Canadian crude moving to Houston. We're already realizing some of that through the plant in South Pipeline and we expect more of that in full-year 2015. So I still see potential there. The refining business is challenging and we know that, but we're going to continue to work this asset and make sure it realizes its full potential.

Thank you very much.

James Sheehan, SunTrust.

Thank you. Could you give me your outlook for MTBE raw material margins over the next 12 months?

Yes, I think generally butane looks to be favored and butane is abundantly available especially going into the summer months. Recently, while I was in Europe and we were getting butane at we haven't seen in many, many years. Here in the US, this is same. So, our view is that it's part of the broader NGL storage and we think butane will be abundant and will contribute to the profitability of our MTBE business going forward.

Thank you. And also, has you attitude towards condo crackers changed in the low oil price environment?

Well, we're always open to considering different concepts and options. But, as you know, we have a strong list of projects in front of us. And as I mentioned earlier in the call, 2.3 billion pounds to 2.4 billion pounds of ethylene expansion. Beyond that, we're always open to considering other projects, but we have enough on our plate and we want to execute flawlessly on what's ahead of us.

Thank you very much.

Duffy Fischer, Barclays.

Yes, good morning. Want to jump to Europe if we could, your operating rates relative to the industry were outstanding, but do you see others trying to imitate you and going more to NGLs and basically reducing their cost so that you might have to run more in line with industry averages over the next couple of years?

Good morning, Duffy. Well, in Europe, the landscape is little different than the US because each cracker has its own set of circumstances, given that there isn't a robust logistics [backline] system for feedstocks and for products. So a lot of the crackers in Europe, they are tied to the neighboring refinery and often the ownership is the same. So while they might aspire to crack more propane or more butane, their [feedstock] may be more fixed given location and ownership structure and those kind of things. So incrementally, the industry over there likely will crack a bit more propane, but I don't see that materially impacting our operating rates or our ability to leverage propane and butane there.

Okay. And then, another one around Europe. The Middle East can basically ship product to Europe or Asia is kind of a swing factor. Do you see lower oil changing the competitive balance between Asia and Europe as a home for Middle Eastern product?

Well, those are the two most natural destinations and over time, generally, the arc tends to come in where the Middle East could be indifferent. I will tell you that the Asian market is served than in the European market and it's a more natural destination for Middle East product. We'll also have to watch the euro dollar exchange rate, as the euro weakens, Asia could look like a more attractive export destination. And lastly, European buyers are more sophisticated and at times require more higher-end products and so on, typically, not the kind of products we would produce in a large facility in the Middle East. So a lot of factors that point through Asia being the more likely destination for the Middle East exports.

Great. Thank you, guys.

Thank you.

Aleksey Yefremov, Nomura.

Good morning. I wanted to come back to MTBE. Is there any reason why demand for MTBE would be weaker in 2015 versus 2013, perhaps less demand for octane or any other reason?

Hi, Alex, this is Doug. I think, when you think of MTBE, remember really what it is, right, basically it's a high-octane gasoline component, good vapor pressure, no sulfur, fits in very well into environment. To see ups and downs based on octane demand to operating rates and things like that, but generally what you're finding is you have a market where octane is in demand, there is a number of higher vapor pressure, lower octane materials available in the forms of and things coming off of wells in the US. And MTBE, it is a natural bonding component around the world. So I think you would see a solid market. The things in there are, you would basically have another gas to oil situation and with the oil butane price and butane inventories are as long as they have, it's responded to the lower-price oil environment and margin seem to be good, volumes are good.

Great. Thank you. And I have a followup, turning to Olefins and Polyolefins. Are there any meaningful annual contracts that reprice this year in terms of annual contracts that could benefit you in 2015? For example, we saw that polypropylene contracts were reported as being more advantageous to producers this year. Is there anything like that going on in polyethylene or ethylene?

No, there is really nothing significant that I would call out here.

Great. Thank you

Kevin McCarthy, Merrill Lynch.

Yes, good morning. Can you speak to the extent to which your long-term view of US NGL supply may have changed given the collapse in crude and the impact on drilling activity? I guess I'm kind of interested in the 2018 to 2020 time frame given the probability that the early-wave crackers start up and our understanding is that somebody ethane exports have take or pay contracts. So wondering if you see a rebalance sooner than you previously did and if so, whether or not that will impact your capital allocation beyond late 2017 in your Channelview project there.

Yes. Good morning, Kevin. We haven't changed our view on ethane supply-demand longer term. In the near term, the market will go through a bit of a transition. As you've probably read and all I've read, there has been a pretty significant response on the supply side in oil. Most of the majors, they've announced 30% to 50% cut in their CapEx budgets. Smaller E&P companies have announced cuts as well. Likely, this will lead to a response in oil price, I can't tell you when likely that will happen and longer term, we think the US will continue to be a strong producer of natural gas and NGLs and we don't see the availability of ethane materially changing and to answer your question about the capital program, I don't have any plans to adjust our capital program based on the current market conditions in terms of our growth plans on ethylene. We are going to continue on the path we are on; we are going to continue both Channelview expansions and the Corpus Christi expansion.

Okay. And then, a follow-up if I may on the issue of de-stocking and restocking I suppose. If I look at the volume numbers that you have on slide 13 and 14, looks like the sequential volume decrement for whatever reason was a lot larger in the Americas versus Europe, just curious as to why that might be the case and whether or not you're seeing different behavior along the lines of inventory management in the two regions.

Kevin, it's Doug again. We're not seeing anything that's really different or unusual. The metrics might say if I was seeing sort of the normal end of season decline as Bob mentioned, you saw a little bit of a slowdown in volume which we think is some destocking with it. But overall, we're not seeing a big reaction to the pricing and so I wouldn't say anything is different across either of the two regions and both really pretty reliant, pretty typical of what we've seen at year-end.

Okay, thank you very much.

Frank Mitsch, Wells Fargo Securities.

Yes, hi good morning, folks, and let me also offer my congratulations Bob on your new position. Hey, first a clarification. As I am looking at the slide 9, you talked about polyethylene being down $0.05 in January versus December here in the US. And I guess I was hearing in certain circles that it was only down $0.04. Can you clarify where did the industry settle?

The industry settled at $0.04.

Alright, great. And then, in terms of the new projects, your predecessor laid out that the Channelview expansion would probably be contributing on an annual basis $90 million of EBITDA and the Corpus Christi expansion is going to be adding about $300 million of EBITDA. We know everything was fully up and running and obviously that was a level where oil was materially higher than it is today. How should we think about those projects in terms of what the ultimate contributions can be and then I also noted, I think on Corpus Christi, originally, that was supposed to come up late 2015 and now, it looks like it's going to be coming up in the second quarter of 2016, was there anything behind the move to delay that expansion?

Hi, Frank. This is Doug. Let's first talk about the contribution. I mean, it's still 800 million pound expansion. So we see the margins over the market turns out to be and we think of where we are now as Bob said, this is showing fully margins at over $0.25 a pound. So, we will see where things move in this world that we're in where things are moving up and down a little bit right now, but regardless of where it settles, very strong, whether it's going to be 2013 models or not, impossible for us to say at this juncture.

Now, as far as the timing of Corpus, what we've done is, we're going to do our turnaround in the first quarter at Corpus and as you can understand, where we're making a significant increase in the capacity, they're tieing in a lot of new equipment. So we have to tighten the expansion with a turnaround. So we'll do the turnaround in the first quarter, that will put us in position to bring up the expansion in the second quarter, but it's very much like we did at La Porte.

Just a matter of [training], Frank.

Alright, terrific. Okay, thank you so much.

Thank you.

Don Carson, Susquehanna.

Yes. Thank you. A lot of discussion of where ethylene margins might go, but can you also talk about polyethylene over ethylene spreads? As your chart on Page 8 shows, they've widened considerably in the US in the last few years. What drove that and where do you see that heading over the next one to two years?

Well, part of what drove that, Don, in the past year is just supply demand there. The market has been very strong in the US and we haven't had expansions here in quite some time. So market dynamics are very good here. In the near term, I think demand as I mentioned earlier should be incrementally better as we work through the year, the restocking as well as some seasonal up-tick in demand. Longer term, our prices in the US tend to be fair and will be more so in the future at times to export equivalent and so on, especially more for the commodity products. And there again, with a wide crude to gas ratio and abundance of ethane here in the US, American producers should enjoy reasonably good margins.

So it doesn't sound like you're in the bear camp at those spreads. I know there is a lot of controversy over whether those spreads are sustainable or not, so appreciate that color. And then, finally, if you can just clarify, obviously with a lot of plants in the US, you consume a lot of natural gas, just as a fuel for those plants, just ignoring the feedstocks out of the equation, what's kind of your exposure to the decline in natural gas that we've been seeing in the US?

We've certainly benefited from the natural gas price dropping some, I don't know if we have a number.

Utility specifically for us across all the facilities, $1 in the gas can be about $250 million in utilities, that's including the refinery and the crackers, et cetera.

Okay, thanks, Doug.

Hassan Ahmed, Alembic Global Advisors.

Hi, there, Bob. There were obviously a couple of questions earlier about I guess the resilience of ethylene prices in light of declining crude. I would imagine one of the reasons for that would be significantly lower co-product value contributions, right? And I would imagine again in particular propylene. So just wanted to hear your views about the near to medium-term outlook for propylene prices, particularly keeping in mind how you're running crackers in Europe pretty hard as well as a fair amount of call it PDH as well as methanol to propylene capacity coming online?

Yes. Good morning, Hassan. When we think about propylene in the US, they were net short on a capacity basis. Our derivatives' ability to consume propylene and the amount of propylene that's produced. Propylene prices already corrected significantly in the past couple of months and as ethane and propane compete to be in the [feedsplay] like crackers, the amount of propylene supply will vary. My sense is that at these prices, propylene is on the low end, but we'll just have to see how supply demand plays out, but just remember that there is more consumption capacity of propylene at the moment than there is production capacity.

Right, sir. And as a follow-up, one of the things that I sort of read in your press release was in terms of 2015 goals, improving your performance on the methanol side of thing. Just wanted to get a sense of why they were deflated operating rates through the course of 2014 on the methanol side, where you see operating rates going through the course of this year, particularly in light of significantly lower methanol prices as well?

Well, you would recall that that methanol plant was idled for many, many years and we restarted it. So generally when you restart units that had been idle for that long, you're bound to discover things after you started up that we need to address and quite frankly, we got this project done quickly and we came back and found that we need to bear a few things and we've done that, but we will do that here in Q1.

Having said all of that, that is still an incredibly profitable project for us, providing very strong returns and so we had to work through a few of the kinks last year. This year, we expect based on our view on natural gas and our methanol prices that running at full rates will be the right thing to do this year given the outlook on margins and so we expect to run after the first quarter, maintenance activity to run at [full rates].

Super. Thank you so much, Bob.

Thank you.

John Roberts, UBS.

Congratulations, Bob. Karyn, do we have to worry about foreign exchange at all in 2015 or are most of your US exports in dollars and European margins basically adjust to US dollar equivalent quickly?

I think that's basically right. So our gross transaction exposure, that essentially, the majority of that will help investor to be present of that transaction exposure, really has natural offset, and the remaining exposure is generally managed through our FX derivatives. So, the exposure to it is a combination of a lot of factors. Substantially, it's due to our naphtha purchases in Europe. Our IDE business also played a role and the inputs in US and US dollar and sales in Europe, purchases and results from euro entities in dollars. So, (inaudible) butane feedstocks. In addition, our catalyst in licensing business which isn't US dollar related but your company. So, knowing at a total FX exposure, half of that is intact internal offsets and remaining at net amount of. Well, do you have a translation impact in the balance sheet? I have always see that. other comprehensive income. And I have the total significant number next year. Let me drop from $1.38 to $0.49 year-over-year. So that's a lot of shareholders' equity, but that is surely just balance sheet only. And then, on a translation perspective, when the moderates play out, year-over-year to 2014, you really didn't have any significant impact. So, we were at $1.33 for the average for last year and we were in 2014. So, overall from an translation on a P&L perspective, very variable impact in the P&L.

Thank you.

We will take one more question. We are probably little bit over time. It's being Bob's first opportunity to speak. I believe we'll take one more question.

Nils Wallin, CLSA.

Great, thanks for taking my question. Good afternoon. I know Lyondell has been pretty forthright saying that there is some expectation in all the new builds in the US could get pushed out just because of the normal length of time it takes to build these plants. Now, with lower oil, there might be less desire to push these plants as quickly as possible to bring them up but on the offset, you obviously have probably lower labor cost due to all the energy CapEx reductions. What's your view today of when these plants come on stream? Are they delayed, it is the same? Just some color there would be appreciated, thanks.

Good afternoon, Nils. Well, there are several projects that are already underway in terms of construction and so something like seven crackers likely those, they will be built at whatever pace the projects progress at. It's likely the second wave of projects that were announced, which will be revisited, but I think the seven or so that are under construction or will be soon, they're very likely to come on.

Got it. And then, just sort of, I guess a little bit of a technical question on the difference between ethane and propane costs, I mean historically, propane was sort of thought as the ceiling to the ethane price once you net it out all the co-product credits. Now, it's below ethane. So curious as to why the projection is certainly for it to be to continue to be below ethane for the remainder of the year. So curious as to why you think ethane won't correct down to return to its historic relationship and what might be presenting that?

Well, short-term you get these kind of dislocation based on inventory or maybe specific logistics-related constraints. But longer term or later on this year, I would expect that propane will set the ceiling. We also have to remember that ethane cannot go too much below its fuel value and it's been trading right around its fuel value. So I think the two will compete, Nils, and I don't know if propane will really remain more advantaged than ethane for the entire year, that remains to be seen. The good news is that both are in abundant supply and therefore, we should see an advantaged feedstock position here in the US for this year.

Got it thanks very much.

Alright. Well, thank you for all your questions and I'd like to just close with a few comments. First of all, we had a banner year in 2014. I'm not going to repeat all of the operational accomplishments and so on, but it's worthy of highlighting that we returned $7.2 billion to shareholders in 2014 via our regular dividend and share repurchase program. We remain committed to the share repurchase program. We have a very strong and flexible balance sheet, which will be durable really in any environment and will support our strategies going forward.

While I am new to the COO role, I'm not new to the Company and I'm certainly not new to the industry. You should expect that in the near term, our focus is going to continue to be on safety and operational excellence, and cost management, and delivering on all these growth programs that we have in front of us. Longer term, we'll continue to build out our strategy and align with the Board and the kind of things we want to do and to the extent that we can discuss some of that with you, we'll do so at our Investor Day on April 29. So, thank you very much for your continued interest in our Company and we'll look forward to you next time. Thank you.

This concludes today's conference. Thank you for your participation. You may now disconnect.