Lyondell says debt repayment approaching $4 billion

By Jennifer Lanning Drey

Portland, Ore., June 11 - Lyondell Chemical Co.'s debt repayment will approach $4 billion by June 31, Kevin DeNicola, Lyondell's chief financial officer, said in a presentation given Monday at the JP Morgan Basics & Industrials Conference in New York.

Lyondell's debt repayment goal for 2007 and beyond is $3.5 billion, and the company believes meeting that goal will lead to advantages including avoided interest expense of $350 million per year and an earnings improvement of $0.90 per share, according to DeNicola's presentation.

Lyondell's long-term debt stood at $7.92 billion at March 31, while total liabilities and stockholders' equity was $18 billion on the same date, according to its 10-Q filing made with the Securities and Exchange Commission.

In addition to repaying debt, the company's current financial strategy also focuses on maintaining appropriate liquidity, managing fixed and working capital, containing costs, and achieving investment-grade credit ratings, according to the presentation.

DeNicola also said Lyondell has become a more balanced and diversified company, and while the share price has responded to that to some extent, it still lags the business transition.

Lyondell had cash and cash equivalents of $211 million at March 31, according to the 10-Q filing.

Based in Houston, Lyondell is a global producer of basic chemicals, polymers and fuels.

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