LyondellBasell SWOT and PESTLE Analysis
COMPANY PROFILE -LyondellBasell Industries N.V.
Business Sector :Plastics and Petrochemicals
Operating Geography :United Kingdom, Global
About LyondellBasell Industries N.V. :
LyondellBasell is a multinational petrochemical company which specializes in production of Olefins and Polyolefins, which are used to manufacture industrial and consumer plastic products. The company also manufactures “Intermediates and Derivatives”, “Advanced Polymer Solutions”, “Refinery products” and “Technology solutions”. The company’s Olefins and Polyolefins segment is further divided into the Americas and Europe, Asia and International (EAI) segments. The company’s international headquarters are located in London, UK, while it has executive offices in various locations across the world.
The company converts large amount of gaseous and liquid hydrocarbons, called as feedstock, into plastic resins and other industrial chemicals. The final products of the company act as building blocks of other chemical manufacturers. Customers of LyondellBasell use the plastic resins produced by the company to manufacture all kinds of products used in paints and coatings, automotive components, food packaging and home furnishings. As of early 2020, LyondellBasell is the second-largest producer of PO worldwide and the second-largest producer of oxyfuels worldwide.
LyondellBasell’s USP or Unique Selling Proposition sprawls in being one of the top independent chemical companies by revenue and an industry leader in some of its product lines. The company’s mission statement reads “To consistently deliver industry-leading performance by Safely and reliably delivering high quality products to customers, Being the company of choice for employees and shareholders, Being a responsible, good neighbor in the communities where we operate.” LyondellBasell’s vision statement states “We work every day to be the best operated and most valued company in our industry, today and tomorrow.”
LyondellBasell Industries N.V. Revenue :
$34.727 billion – FY ending 31st December 2019 (Y-O-Y Growth of (negative) – 12.3%)
$39.004 billion – FY ending 31st December 2018
Competitive Analysis of LyondellBasell Industries N.V.
The SWOT analysis for LyondellBasell is presented below in a matrix followed by detailed analysis
Strengths | Weaknesses |
1. Developing products which drive a range of solutions across major geographies and sectors 2. Disciplined capital allocation which generates cash consistently 3. Global leader in polyolefins and chemicals technology 4. An industry leader with a global presence 5. Focus on sustainability through value driven innovation | 1. Company is prone to cyclicality and volatility |
Opportunities | Threats |
1. Renewal of Chinese plastic demand 2. Growing demand for polyurethane based products | 1. Low crude oil prices leading to lower competitive advantage 2. Exchange rate fluctuations could lead to reduced profitability 3. PE spreads in China at a seven-year low 4. Adverse weather conditions forcing plant shutdowns |
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Detailed SWOT Analysis of LyondellBasell Industries N.V.
Strength
1. Developing products which drive a range of solutions across major geographies and sectors: LyondellBasell's products include chemicals, polymers, advanced polymers, fuels, and technologies which provide a comprehensive range of solutions in almost every geography and sector of the economy. The company offers Stronger and lighter plastics that support increased fuel efficiency rendering cleaner air. Food packaging and film solutions offer to improve freshness, portability, and extend shelf-life. The company also offers solutions like Lighter machinery, crop protection, and soil conditioning in order to enhance Agricultural efficiency. To enhance Sustainable and modern living LyondellBasell also renders materials that form components used in solar panels, wind turbines, children’s toys, cosmetics, leak- and shatter-proof containers. Additionally, the company's stronger, longer-lasting pipes are used in municipal water systems and key elements used in water filtration systems hence providing clean water. Furthermore, the company's aim at providing quality healthcare solutions relies on improving medical supplies such as synthetic latex gloves, hand sanitizers, biohazard bags, and pill coatings.
2. Disciplined capital allocation which generates cash consistently: LyondellBasell generated $5 billion in cash from operating activities. It has been generating this amount of cash consistently since the past six years. The reason cited by the company for such consistent returns is its capital allocation strategy, wherein it strategically spends its cash from operations to generate value for its shareholders. The company plans to distribute $1.4 – 1.5 billion as dividends to its shareholders for the 2020-22 period. Secondly, the company intends to invest $1.1 – 1.2 billion in sustaining capital expenditure. From 2013, the company has made many such expansions like ethylene 1000 KT, polyethylene 210 KT, polypropylene 120 KT and PP compounds 120 KT. Lastly, the company has made investments future projects like Hyperzone polyethylene 500 KT and PO/TBA 470/1000 KT.
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Weakness
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Opportunity
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Threat
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Major Competitors :
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TABLE OF CONTENTS
DELIVERY AND FORMAT
WHY CHOOSE US?
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References used in LyondellBasell Industries N.V. SWOT & PESTLE Analysis Report
1. LyondellBasell Annual Report 2019 - https://www.lyondellbasell.com/globalassets/investors/company-reports/2019/2019-annual-report.pdf?id=27882
2. LyondellBasell Investor day presentation 2019 - https://www.lyondellbasell.com/globalassets/investors/events/2019/investor-day-2019.pdf
3. LyondellBasell licensed technology brochure - https://www.lyondellbasell.com/globalassets/products-technology/technology/licensed-technologies-brochure.pdf
4. LyondellBasell About Us - https://www.lyondellbasell.com/en/about-us/
5. LyondellBasell Sustainability highlights - https://www.lyondellbasell.com/en/sustainability/
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SWOT & PESTLE.com (2024). LyondellBasell SWOT and PESTLE Analysis - SWOT & PESTLE.com. [online] Available at: https://www.swotandpestle.com/lyondellbasell/ [Accessed 12 Sep, 2024].
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LyondellBasell SWOT and PESTLE analysis has been conducted by Divyansh Kharadkarand reviewed by senior analysts from Barakaat Consulting.
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