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DATE

Tuesday, May 5, 2026, at 1 p.m. ET

CALL PARTICIPANTS

  • Chief Executive Officer — Jean-Marc Gilson
  • Chief Financial Officer — Steve Bender
  • Director, Investor Relations — Jeff Holy

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TAKEAWAYS

  • Net income -- $14 million, or $0.40 per unit, attributable to the partnership for the quarter.
  • Consolidated net income -- $82 million, including OpCo earnings, on consolidated net sales (revenue figure partially inaudible in the transcript).
  • Distributable cash flow -- $18 million, or $0.51 per unit, up $13 million from the prior year due to higher production and lower maintenance capital following the absence of a planned turnaround.
  • Distribution -- $0.47 per unit declared for the quarter, marking the 47th consecutive quarterly distribution since IPO, with distributions up 71% from the original minimum quarterly distribution.
  • Coverage ratio -- Trailing twelve-month distribution coverage improved to 1.0x from 0.8x sequentially, reflecting normalization after last year's turnaround.
  • Operating surplus -- Increased by $1 million, resulting in a coverage ratio above 1.0x for the quarter.
  • Consolidated cash and investments -- $81 million at quarter-end, held in cash and investments managed with Westlake Corporation.
  • Long-term debt -- $400 million outstanding, with $377 million at the partnership and $23 million at OpCo.
  • Capital expenditures -- OpCo spent $6 million in the quarter.
  • Leverage ratio -- Maintained at approximately 1.0x, indicating conservative financial management.
  • Fixed-margin ethylene sales agreement -- The majority of OpCo volumes are under contract at a fixed $0.10 per pound margin to Westlake Corporation, providing stability.
  • Third-party ethylene sales -- About 5% of production benefits from higher spot pricing, with more third-party ethylene volumes sold in March to capitalize on market conditions.
  • CFO transition -- John Baxter will assume CFO duties on June 15, 2026, as Steve Bender transitions to special adviser to support the leadership handover.
  • Planned turnarounds -- No additional turnarounds are planned for 2026, according to management.

SUMMARY

Westlake Chemical Partners (WLKP 0.44%) emphasized the stability of its cash flow, supported by a fixed-margin sales structure that reduces exposure to market volatility in ethylene production. Management noted increased demand from global chemical customers for North American supply, attributing this to Middle East conflict and related supply chain disruptions. The company is evaluating four growth levers: expanding OpCo ownership, acquiring new qualified assets, pursuing organic facility growth, and potentially renegotiating for higher contract margins.

  • Chief Financial Officer Bender said, "We did sell more volume in the first quarter than might typically be done, for example, versus last year's first quarter, and it did improve the margins associated with the business as a result of doing so."
  • The partnership reported no need to access capital markets to sustain its current distribution profile, citing a stable cumulative distribution coverage ratio since IPO.
  • Leadership reiterated its commitment to regular distributions and highlighted a 71% increase in quarterly payout since 2014.
  • The operational outlook includes capital discipline and a focus on balance sheet strength, with a clear path to maintaining leverage at approximately 1.0x.

INDUSTRY GLOSSARY

  • OpCo: Westlake Chemical OpCo LP, the operating subsidiary responsible for ethylene facility ownership and operations under the partnership structure.
  • Fixed-margin ethylene sales agreement: Long-term contract structuring sales of ethylene from OpCo to Westlake Corporation at a pre-defined per-pound margin, insulating the partnership from ethylene market price swings for contracted volumes.
  • Distribution coverage ratio: A metric reflecting the ratio of distributable cash flow to distributions paid, indicating the partnership’s ability to support ongoing distributions from internal cash generation.

Full Conference Call Transcript

This morning, Westlake Chemical Partners LP issued a press release with details of our first 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. Please note that information reported on this call speaks only as of today, 05/05/2026, 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: Thank you, Jeff, and good afternoon, everyone, and thank you for joining us to discuss our first quarter 2026 results. In this morning's press release, we reported Westlake Chemical Partners LP first quarter 2026 net income of $14 million, or $0.40 per unit. Compared to the first quarter of 2025, our first quarter sales and earnings benefited from a higher third-party average sales price that was offset by slightly lower production and sales volumes. The stability of Westlake Chemical Partners LP’s business model is consistently demonstrated through our fixed-margin ethylene sales agreement, which minimizes market volatility and other production risk.

The high degree of stability in cash flow, when paired with the predictability of our business, has enabled us to deliver a long history of reliable distributions and coverage. This quarter’s distribution is the 47th consecutive quarterly distribution since our IPO in July 2014 without any reductions. Before I turn the call over to Steve, I want to provide some thoughts on our CFO transition. As you may have read, on April 20, we announced that on June 15, John Baxter will join Westlake Corporation and Westlake Chemical Partners LP as senior vice president and chief financial officer.

John brings experience from the oil and gas, packaging, and building products industries, as well as investment banking, to Westlake Corporation, and we look forward to him joining the partnership. On June 15, Steve Bender will transition to the role of special adviser and will continue to report to me as he supports the transition. We anticipate that Steve will participate in the second quarter earnings call in August. With that, I would like to turn our call over to Steve to provide more detail on the financial and operating results for the quarter. Steve?

Steve Bender: Thank you, Jean-Marc, and good afternoon, everyone. In this morning's press release, we reported Westlake Chemical Partners LP first 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 $3[inaudible]6[inaudible]. The partnership had distributable cash flow for the quarter of $18 million, or $0.51 per unit. First quarter 2026 net income for Westlake Chemical Partners LP of $14 million was $9 million above the first quarter of 2025 partnership net income, due primarily to higher production and sales volumes as a result of last year's planned turnaround at Petro 1.

Distributable cash flow of $18 million for 2026 increased by $13 million when compared to 2025, due to higher production and sales volumes, and lower maintenance capital expenditures as a result of last year's Petro 1 planned turnaround. As compared to 2025, net income for Westlake Chemical Partners LP in 2026 declined by less than $1 million due to lower production and sales volumes that were mostly offset by a higher third-party average sales price. Sequentially, our trailing twelve-month coverage ratio improved to 1.0x from 0.8x, reflecting the aging out of the impact of the Petro 1 turnaround that occurred in 2025.

Additionally, our operating surplus improved by $1 million as we achieved a coverage ratio above 1.0x in the first quarter. Turning our attention to the balance sheet and cash flows, at the end of the first quarter, we had consolidated cash and cash investments with Westlake Corporation through our investment management agreement totaling $81 million. Long-term debt at the end of the quarter was $400 million, of which $377 million was at the partnership; the remaining $23 million was at OpCo. In 2026, OpCo spent $6 million on capital expenditures. We maintained our strong leverage metrics with a consolidated leverage ratio of approximately 1.0x. On 05/04/2026, we announced a quarterly distribution of $0.4714 per unit with respect to 2026.

Since our IPO in 2014, the partnership has made 47 consecutive quarterly distributions to unitholders, and we have grown distributions 71% since the partnership's original minimum quarterly distribution of $0.275 per unit. The partnership's first quarter distribution will be paid on 06/01/2026 to unitholders of record on 05/14/2026. The partnership's predictable, fee-based cash flow continues to prove beneficial in today's environment and is differentiated by the consistency of our earnings and cash flows. Looking back since our IPO in July 2014, we have maintained a cumulative distribution coverage ratio of approximately 1.0x, and with the partnership’s stability in cash flows, we were able to sustain our current distribution without the need to access capital markets.

For modeling purposes, we have no planned turnarounds in 2026. I would like to turn the call back over to Jean-Marc to make some closing comments. Jean-Marc?

Jean-Marc Gilson: Thank you, Steve. We are pleased with the partnership’s financial and operational performance during the first quarter. Solid operating rates at OpCo's ethylene facilities during the quarter resulted in a quarterly coverage ratio of 1.0x. Turning to our outlook, the conflict in the Middle East has significantly disrupted the global supply of oil, chemical feedstocks, and polymers. Resulting supply concerns are prompting global chemical customers to source more material from North America in response to the conflict, which is supporting higher demand and prices for North American ethylene.

While most of OpCo's ethylene volume is contracted to Westlake Corporation at a fixed margin of $0.10 per pound, margin for the approximately 5% of production that OpCo typically sells to third parties is benefiting from higher selling prices as a result of the factors I just discussed. Turning to our capital structure, we maintain a strong balance sheet with conservative financial and leverage metrics.

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 Corporation. 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 first quarter earnings call.

Now I will turn the call back over to Jeff.

Jeff Holy: 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 will provide instructions to access the replay at the end of the call. Kelly, 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 11 on your telephone and wait for your name to be announced. To withdraw your question, please press 11 again. Our first question comes from the line of James Altschul of Aviation Advisory Service Inc. Your line is now open.

Analyst: Good afternoon, and thanks for taking my call. In your prepared remarks, you mentioned that you anticipate seeing increased margins on the 5% of your sales to third parties as a result of the war and the increased interest in sourcing your products from a North American–based supplier. Did we really see the impact of that in the first quarter? The war started in February, and I am not remembering exactly when the price of oil started to jump and when shipping was intercepted. Are we going to see a more significant impact in the second quarter?

Steve Bender: Yes, that is a very good question. As a result of the run-up in ethylene pricing, we took the opportunity in March to sell more third-party ethylene volumes than would normally be the case. We typically try to take opportunities to maximize margin in this business when we see conditions like this. We did sell more volume in the first quarter than might typically be done, for example, versus last year's first quarter, and it did improve the margins associated with the business as a result of doing so.

Analyst: Okay. But I am looking at the income statement, and it says on revenue the figure for third-party sales is a few million less than the comparable quarter last year. Of course, that is sales, not margin.

Steve Bender: That is correct, and it reflects the impact of only one month of activity. As we look into the second quarter, if we continue to see elevated ethylene pricing and similar opportunities, we will continue to take them, and I would expect more of a positive impact in the second quarter.

Analyst: Excellent. Thank you very much.

Steve Bender: You are quite welcome.

Operator: Thank you. I am showing no further questions at this time. I will now turn the call back over to Jeff Holy.

Jeff Holy: Thank you, Kelly. Thanks, everyone, for participating in today's call. We hope you will join us for our next conference call to discuss our second quarter 2026 results.

Operator: This concludes today's Westlake Chemical Partners LP first quarter 2026 earnings conference call. As a reminder, this call will be available for replay beginning two hours after the call has ended and may be accessed until 11:59 PM Eastern Time on Tuesday, 05/19/2026. The replay can be accessed via the partnership website. Goodbye.