Good morning, ladies and gentlemen, thank you for standing by. Welcome to the Westlake Corporation First Quarter 2023 Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. After the speaker's remarks, you will be invited to participate in a question-and-answer session. As a reminder, ladies and gentlemen, this conference is being recorded today, May 4, 2023. I would now like to turn the call over to your host today, Jeff Holy, Westlake's Vice President and Treasurer. Sir, you may begin. oThank you. Good morning, everyone, and welcome to the Westlake Corporation conference call to discuss our first quarter 2023 results. I'm joined today by Albert Chao, our President and CEO, Steve Bender, our Executive Vice President and Chief Financial Officer, and other members of our management team. During the call, we will refer to our two reporting segments, Performance and Essential Materials, or PEM, or Materials, and Housing and Infrastructure Products, which we refer to as HIP or Products. Today's conference call will begin with Albert, who will open with a few comments regarding Westlake's performance. Steve will then discuss our financial and operating results, after which Albert will add a few concluding comments, and we will open the call up to questions. Today, management is going to discuss certain topics that will contain forward-looking information that is based on management's beliefs as well as assumptions made by and information currently available to management. These forward-looking statements suggest predictions or expectations and thus are subject to risks or uncertainties. These risks and uncertainties are discussed in Westlake's Form 10-K for the year ended December 31, 2022, and other SEC filings. We encourage you to learn more about these factors that could lead our actual results to differ by reviewing these SEC filings, which are also available on our investor relations website. This morning, Westlake issued a press release with details of our first quarter results. This document is available in the press release section of our website at westlake.com. We have also included an earnings presentation, which can be found in the investor relations section on our website. A replay of today's call will be available beginning today, two hours following the conclusion of this call. This replay may be accessed via Westlake's website. Please note that information reported on this call speaks only as of today, May 4, 2023, and therefore you're advised that time-sensitive information may no longer be accurate as of the time of any replay. Finally, I would advise you that this conference call is being broadcast live through an internet webcast system that can be accessed on our webpage at westlake.com. Now, I would like to turn the call over to Albert Chao. Albert. Thank you, Jeff. Good morning, everyone. We appreciate you joining us to discuss our first quarter 2023 results. For the first quarter of 2023, we achieved sales of $3.4 billion, net income of $394 million, and EBITDA of $825 million. These solid results reflect significant improvement in volumes, margins, and earnings from the fourth quarter of 2022 as customer destocking activity moderated, end market demand improved, and we benefited from lower feedstock, fuel, and power costs. As demand improved in the first quarter, we shifted sales volumes from exports to domestic markets, contributing to better sales mix and higher integrated margins. We also benefited from lower feedstock energy costs compared to the levels of 2022 as our globally advantaged low-cost feedstock and energy position in the U.S. Gulf Coast improved further. We also saw lower energy costs in Europe as well. Our results for the first quarter also reflected the achievement of approximately $25 million of cost savings in its quarter towards our previously communicated $55 million-$105 million of targeted 2023 cost savings. Each of these factors supported solid improvement in our integrated margins from the fourth quarter of 2022. Looking at our first quarter financial results, I'm particularly proud of our HIP segment performance, which maintained an EBITDA margin of 20%, similar to the first quarter of 2022. These margins were achieved despite a 21% decline in volume when compared to the prior year period, which was driven by the decline in home building activity due to lower affordability from higher mortgage rates. This demonstrates the benefit of our product mix and strength of our brands. The margin stability of these businesses, along with the long-term growth opportunity in the U.S. housing market, were key reasons why we invested in the HIP segment in 2021 through the acquisitions of Boral Building Products, LASCO Fittings, and Dimex. We continue to have a positive long-term view of the U.S. housing market, driven by the deficit in new housing construction since the Great Recession in 2008, increasing demographic demand. Turning to our PEM segment, we continue to operate with agility as we navigated the current market dynamics. By shifting PVC and polyethylene sales volume back from export markets to rebounding domestic markets. Solid chlor-alkali markets drove higher average selling prices for both chlorine and caustic soda in North America. Lower feedstock energy prices, combined with our cost reduction actions, drove significant improvement in integrated margins from the fourth quarter of 2022. Overall, I'm very pleased with our first quarter performance and the team's ability to successfully adjust to rapidly changing end market trends. I would now like to turn our call over to Steve to provide more detail on our financial results for the first quarter 2023. Thank you, Albert. Good morning, everyone. Westlake reported net income of $394 million or $3.05 per share in the first quarter of 2023 on sales of $3.4 billion. Net income for the first quarter of 2023 decreased $362 million from the first quarter of 2022 as a result of lower average selling prices and integrated margins, particularly for PVC, polyethylene, epoxy resins, and lower production and sales volume in each segment. When compared to the fourth quarter of 2022, net income increased by $162 million in the first quarter of 2023 due to higher production and sales volume in each segment, lower feedstock fuel and power cost in North America and Europe. The challenging market conditions that we experienced in the fourth quarter of 2022 improved throughout the first quarter of 2023 as destocking abated and North American demand for PVC and polyethylene improved, which allowed us to shift sales volumes back to domestic from export markets in this stronger environment, driving higher net backs. The customer destocking in our HIP segment that occurred in the second half of 2022 also abated, which, along with a seasonal uptick in spring construction activity, drove a 10% sequential increase in HIP volumes. Overall, we were pleased with the first quarter 2023 operational and financial results, and we are cautiously optimistic about demand trends as we move into the seasonally stronger second quarter. For the first quarter of 2023, our utilization of the FIFO method of accounting resulted in an unfavorable pre-tax impact of $45 million compared to what earnings would have been reported on the LIFO method. This is only an estimate and has not been audited. Moving to our segment performance, our Performance and Essential Materials segment first quarter 2023, EBITDA of $615 million decreased $456 million from the first quarter of 2022. Compared to the prior year period, performance materials sales in the first quarter decreased $647 million, largely driven by lower average selling prices, particularly for PVC resin, in addition to lower sales volumes across our portfolio. Essential Materials sales in the first quarter of 2023 decreased $164 million over the first quarter of 2022, primarily driven by higher average selling prices for caustic soda. As compared to the first quarter of 2022, our earnings were impacted by lower integrated margins for all of our performance material products, including PVC, epoxy, polyethylene, and lower production and sales volumes across most product lines. These headwinds were partially offset by higher average selling prices in Essential Materials along with lower fuel and energy prices. PEM segment EBITDA of $615 million in the first quarter increased $172 million from the fourth quarter of 2022 as a result of six key elements: Higher production and sales volumes, particularly in PVC and epoxy resins. Improved performance material sales mix as volumes in polyethylene and PVC shifted to domestic markets. Higher essential materials average selling prices driven by caustic soda. Lower feedstock and energy cost. Reduced turnaround activity, particularly in epoxy, and benefits from the cost savings program we previously announced. Turning to our Housing and Infrastructure Products segment, we saw improved demand driven by seasonal uptick compared to the fourth quarter of 2022 as our customers saw improved demand in their markets. HIP's segment EBITDA of $205 million for the first quarter of 2023 decreased $53 million when compared to the first quarter of 2022. Housing product sales decreased $154 million from the prior year period as volumes declined by double-digit rates across all product categories. Infrastructure product sales fell $63 million from the first quarter of 2022, primarily due to a decline in sales volumes of infrastructure products servicing fresh and wastewater applications. The volume decline in Housing and Infrastructure Products were driven by lower housing starts and lower inventories carried by our customers in the first quarter of 2023. These volume declines were only partially offset by higher average selling prices and lower raw materials cost, along with the benefits realized from our cost savings program. When compared to the fourth quarter of 2022, HIP segment EBITDA of $205 million increased $72 million. Housing products sales of $818 million in the first quarter of 2023 increased $60 million, while infrastructure products of $189 million in the first quarter increased $9 million from the fourth quarter of 2022. The higher sales and earnings were the result of lower raw material cost and broad-based increases in sales volumes due to the moderating customer destocking and seasonal construction trends that I previously discussed. The overall macroeconomic backdrop remains uncertain, and our customers have kept their inventories rather tight as they look for improvements in economic activity. In our HIP segment, while the first quarter experienced the beginning of the seasonal increase in construction activity in North America, with March housing starts reported at $1.42 million, similar to the average level for the second half of 2022, we continue to see our HIP customers remaining cautious in building inventory until they see less uncertainty in the economy. We are controlling our cost, working closely with our customers to provide the PEM products they demand, and supporting our building product customers with the premium brands and products to meet their building and remodeling needs. Turning to the balance sheet and cash flows, as of March 31st, 2023, cash and cash equivalents were $2.4 billion, and total debt was $4.9 billion, with a staggered long-term fixed rate debt maturity schedule. For the first quarter of 2023, net cash provided by operating activities was $512 million, while CapEx expenditures were $267 million, resulting in free cash flow of $245 million. We continue to look for opportunities to strategically deploy our balance sheet in a shareholder-friendly manner to create long-term value and reward our shareholders. Now, let me provide some guidance for your models. We are reaffirming our earlier guidance for full year 2023 revenue in our Housing and Infrastructure Products segment to be between $4.3 billion and $4.8 billion, with an EBITDA margin in the high teens. We continue to target $55 million-$105 million of annualized savings in 2023, with approximately $25 million already achieved in the first quarter. Our significant cash balance and investment-grade credit rating position allow us to invest in our business and support our customers. We continue to expect total CapEx for 2023 to be approximately $1 billion, which is unchanged from our earlier guidance and is similar to our depreciation and amortization run rate. As a reminder, this includes a planned 30-day turnaround at our Calvert City ethylene unit in the second quarter of 2023. For the full year of 2023, we expect our effective tax rate to be approximately 23%. We also continue to expect cash interest expense to be approximately $160 million. Let me turn the call over to Albert to provide current outlook for our business. Albert? Thank you, Steve. Since the fourth quarter of 2022, the economic environment has improved, but with some mixed economic signals. This improvement in the economy drove demand growth for all our products during the first quarter of 2023 as compared to the fourth quarter of 2022. Additionally, lower natural gas, ethane, and power costs further improved our structurally advantaged low cost position in North America. Taken together, the volume improvement and lower cost position drove the improved first quarter results and highlight the strength of our business in the current economic environment. Looking ahead, we are cautiously optimistic that economic conditions have stabilized and believe demand for our products will continue to improve as 2023 progresses. We expect demand from China to continue to improve, which would spur demand for many of our products, improving integrated margins. We also expect demand in the U.S. to improve with increasing industrial and construction activity. In our HIP segment, the overall housing market continues to be impacted by affordability concerns resulting from the higher mortgage rates. Yet we have seen home builders taking action to address these conditions and adjust prices, including increased incentives. Our strong brand and product mix of 50% new construction and 50% repair and remodeling has remained resilient and supportive of margins in these market conditions. Longer term, U.S. housing remains structurally undersupplied due to the home building deficit since 2007, relative to the 50-year average of 1.5 million new homes built annually, and improving demographics support more first-time home buyers over the coming decade. As a result, we continue to have a very positive outlook on the long-term fundamentals for our building products business. In our PEM segment, growth in global population and continuing urbanization keep the outlook remaining favorable as performance materials used in everyday products such as housing, packaging, healthcare, automotive, and wind energy drive demand for PVC, polyethylene, and epoxy. At Westlake, we recognize that improving the sustainability of our products and operations remains critical to our future success. In the first quarter of 2023, we continued to make progress towards our goal to reduce our carbon intensity by 20% by 2030. We also made significant progress in the commercialization of many of our sustainable products. These exciting products include our One-Pellet Solution, an efficient polyethylene solution incorporating post-consumer resin while maintaining its strength. In our molecularly oriented PVC pipe or PVCO, which provides a lighter weight and more durable PVC pipe with a lower carbon footprint than any other water main pipe material. Our Dimex business, acquired in 2021, is one of the largest recycler of plastic materials in the United States, processing 100 million pounds of scrap and waste annually, including an increasing amount of scrap from other Westlake businesses. As part of our sustainability focus, we are continuing to introduce products into the market that include recycled and bio-attributed components that satisfy consumer demands. Finally, we continue to look for opportunities to redeploy our well-capitalized balance sheet in a disciplined manner that will create long-term value for shareholders. This includes both identifying acquisition candidates with returns that can seed our cost capital and returning cash to shareholders through both dividends and share repurchases. We expect more opportunities to redeploy capital to present themselves as economic conditions stabilize throughout 2023. In the meantime, we continue to benefit from the earnings power and the stability created by the investments we have made in our business and our increasing focus on specialty material and downstream products. Thank you very much for listening to our first quarter earnings call. I will now turn the call back over to Jeff. Thank you, Albert. Before we begin taking questions, I would like to remind listeners that our earnings presentation, which provides additional clarity into our results, is available on our website, and a replay of this teleconference will be available a few hours after this call has ended. We will provide that number again at the end of the call. We will now take questions. Thank you so much. Ladies and gentlemen, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again, and please stand by while we compile the Q&A roster. Your first question comes from the line of Michael Sison of Wells Fargo. Your line is now open. Hey, guys. Nice start to the year. Albert, I think you mentioned that, you know, 2Q tends to be seasonally better than 1Q. As you look at demand and, you know, where integrated margins are for all your businesses, how do you think that plays out this year given, you know, things are weakening across the board? Yes. We've seen inventories destocking run its course and pretty much finished that destocking process. We believe that customers are reordering as they see the demand. We believe that economy has stabilized through the changes, the interest rate increase, and it should improve from the bottoms we're seeing in fourth quarter of 2022. Having said that, you know, the Fed just raised interest rates and they could have repercussions in the economy going forward. We believe that the U.S. economy is still quite strong. Domestic demand is quite strong. We've seen that in our both in the PEM segment, polyethylene PVC, as well as in our HIP building materials business. We are cautiously optimistic that we'll see some improvements. Doesn't mean that we'll go back to 2022 or 2021 high levels before the interest rates start increasing. Got it. You know, for PVC and polyethylene, how is China recovering? Is the export market starting to improve where could really shore up the domestic operating rates? Yes. I think China's economy is improving slowly, slower than people expected after the opening up from pandemic and after Chinese New Year celebrations. We see that the economy is still strong. People are going out, about, traveling and spending. The stimulus from the government as well will take some time, but we believe that China's economy should be improving. Great. Thank you. You're welcome. Thank you so much. Your next question comes from the line of Kevin McCarthy of Vertical Research Partners. Your line is now open. Yes, good morning. Albert, in your press release, there's a comment that you saw increasing demand for epoxy resins, which surprised me a little bit. Can you, can you elaborate on what you're seeing in the epoxy market with regard to you know, demand and operating rates. Looking ahead, are you seeing any increased stability in the pricing function there? Sure. Good morning, Kevin. Yeah, we see epoxy demand improving primarily in North America. It's still quite weak in Europe, with a high-cost position in Europe and also in Asia, it's relatively weak. We are seeing signs of improvement, and the U.S. economy is still growing. We need more window blinds and coatings as well as structural products. We believe that the epoxy business should have a good position going forward, but not as, of course, robust as in 2021, 2022. We believe the demand is there, and I think when the economy recovers, there will be increased demand in epoxy, especially in the U.S., with a lower cost position as well. Okay, thank you for that. Secondly, your HIP segment margins hung in quite well given the volume decline. As you sort of prove out that business through, you know, what seems to be a tougher external environment demand-wise, Albert, do you see opportunities to add, you know, to the construction-related portfolio during the current cyclical downturn? Looks like your net debt has declined about $1.6 billion year-over-year, providing you with more financial flexibility. Curious as to your appetite to, you know, add via acquisitions to that business. Kevin, it's Steve. you're right. We've seen, I think, good performance in the first quarter to be able to maintain very strong margins in that business, and I think it illustrates the strength to the brand and the mix. As we think about the mix of products that we have and the branding, there are opportunities to add to the portfolio in that building products business. We continue to be quite interested to look to fill opportunities where we see demand and can satisfy our customers with those branded products and add to that portfolio. We'll continue to look for opportunities to build out that portfolio where it makes sense. We're constantly looking, and as you would guess, and actively in dialogue with folks. It's just finding the right opportunity and the right price. Understood. Thank you so much. Thank you so much. Our next question comes from the line of Josh Spector of UBS. Your line is now open. Hi. Thanks for taking my question. I was just wondering where you would say your cost base is now. With what you reported in the quarter, does that reflect kind of the lower energy feedstock environment or your LIFO adjustments you call out? Is that the right way to think about that? Is there another tranche that kind of flows through inventory that could help you versus where you are today? Yeah. Certainly as a FIFO reporter, you would imagine that there's still some of that lower cost that will flow through as a result, which is why I always like providing you some sense of what we would see if you're using LIFO versus our FIFO. As you look forward into the forward prices for gas or for ethane, you can see that compared to 2022, 2023 numbers for gas or for ethane will be significantly lower as we see in the forward curve. You know, I think we're very well positioned with a Gulf Coast North American footprint for a large portion of our portfolio, and that strong position will continue to play well if the forward curve plays out as it is forecasted to. Yeah. Josh, just want to add some more information, numbers. As Steve said, the average gas price in 2022 was $6.55 per MMBtu, the current and forecast estimate for 2023 is $2.95 per MMBtu, less than half of that. As you know, natural gas also impact the price of ethane, which is a feedstock for ethylene, and also impact our power price. We buy a fair amount of power. Natural gas price, natural gas is a large fuel input for power. All that has a very positive impact on our cost position. To give you some sense of the earnings potential here, when you think of the sensitivities we have just to natural gas, $1 in MMBtu on an annualized basis across the entire portfolio of Westlake is a $125 million improvement in EBITDA. Given the fact that Albert was looking at $6.55 for 2022 and the forward curve of $2.95, you've got over $3 of forward value that could play through. That, that sensitivity I gave you of $1 to $125 million of EBITDA is a huge potential opportunity for the company to see strengthened earnings this year. Thanks. No, I appreciate all that. Just quickly on the PVC sales mix, I mean, you noted it's improved in terms of shifting back to the domestic market. Would you say it's normal in terms of your mix now, or are you still a little bit more skewed to export than you typically are? Yeah, it's more normal. At the end of last year, the fourth quarter of 2022, because of lack of demand, people are destocking the inventory. We had to export a lot overseas, and those prices are being lower. As the domestic demand recover, as well as the start of building season, is really starting from March. We're seeing the second quarter, the demand has increased, improved a lot more. Okay, thank you. You're welcome. Thank you so much, Josh. Our next question comes from the line of John Roberts of Credit Suisse. Your line is now open. Thank you. You noted the increased exports of polyethylene and vinyls. Could you talk about some of the geographic shift that's going on in epoxy? We've got China epoxies moving into Europe. Are you shifting any of your geographic footprint in your epoxy sales as well? Yes. We are reacting to all the dynamics in the very competitive global marketplace. As I said earlier, that China, with its economy, have been slowing in the past year or quarters. They exported epoxy and as well as PVC to places like India and Europe. We're seeing that being slowing down. The Chinese economy is improving, but things could change. We are very cautious and cognizant of all the activities going on. Secondly, on the Westlake partnership, are you still just waiting for a better value to do more drop-downs? Does it make sense at some point to drop the Lotte cracker interest into the MLP? Yeah. When we think of the opportunity there to put the ethylene or ownership of the ethylene unit for a Lotte end of the unit, it's certainly possible. The issue is, as you noted, is really having the right valuations and the capital access. There is an opportunity to do that if we see the right valuations and the right access to capital. Okay, thank you. You're welcome. Thank you so much. Your next question comes from the line of Duffy Fischer of Goldman Sachs. Your line is now open. Duffy, are you there? Yep. Can you hear me? Yeah, I can now. Okay, sorry about that. When you look at the vinyl chain, chlorine EDC, VCM into PVC, do you see significant shifts in the relative contribution between the steps as we go forward this year? Yeah. Well, we looked at the chain economics, and you're right, they do move up and down the chain. Right now, the chlorine value is very high, so the chain value is more on the chlor-alkali business rather than downstream PVC, but that could change also. Fair enough. One of your large competitors in Epoxy has talked about doing some pretty significant restructuring of their assets. You've had yours for about a year. As you look at it, do you have the right footprint, do you think, in Epoxy, or do you think you need to do some significant restructuring of your asset base as well? Yes. Certainly, we are new to the epoxy business and have had ownership for a year. We find a lot of opportunity to improve. As we go forward, we'll try to improve our positions. Great. Thank you, guys. You're welcome. Thank you so much. Our next question comes from the line of Steve Byrne of Bank of America. Your line is now open. Morning. This is, actually Matthew on for Steve Byrne. We spoke a little bit to this, but Chinese coal prices have been kind of softening up here a bit. I know there was some expectation that perhaps China could rationalize some capacity of PVC 'cause carbide margins are pretty weak. If we think about the competitive position out of Asia right now with maybe a softer feedstock market, do you expect that maybe just goes to some margin relief for those producers and prices will stay kind of where we are, or do you see this as deflationary for global prices? Do you think the demand can kind of soak that up? Yeah, that's a very good question. I think China, the dual control on the carbon emissions, environmental impact per dollar of GDP they generate is still very much concerned by the government at implementing dual control. With the PVC, 80% of Chinese PVC are produced from the coal-based carbide process. The non-integrated producers who are not integrated coal mines with low PVC price cannot really compete at losing money. There could be quite a chunk of Chinese non-integrated producers getting out of business. Doesn't mean that there's also still some expansions announced by the integrated producers. We'll see how those dynamics play out. It should improve the global economy when Chinese coal-based PVC producers are shut down or phased out. Okay. If I look at the U.S. vinyls, like vinyl derivatives, PVC, and just merchant chlorine markets, I mean, is there room for these markets to absorb further chlorine prices should, you know, caustic weaken and we see the, you know, chlorine side of the ECU push further pricing? That's a good question. I think today, U.S. exports around 30 odd percent of its PVC already. I think the caustic wise will export around 20 odd percent. New capacity added on will also be accessing the export market, which is very volatile. Can be good, can be bad. From a price perspective and like the implied margins that we're dealing with in PVC, do you see a world where you can kind of push further chlorine prices into this market, or do you think there's gonna be buyer pushback? If you're integrated, certainly there's margin to be shared. If you're not integrated, then depending where the chain you have, and the biggest use of chlorine in the U.S. is still PVC. If you have chlor-alkali but no PVC, you're not able to access that market. Vice versa, if you have PVC and no chlor-alkali, you can't get a margin. I think Westlake one of the best integrated producer in the U.S. or in the world. Okay. Thanks, Albert. You're welcome. Thank you so much. Our next question comes from the line of Matthew Blair of TPH. Your line is now open. Hey, good morning, Albert and Steve. The HIP volume improvement of up 9.6% quarter-over-quarter appears quite strong, especially in light of just the weak construction markets. Are you able to break this out into, one, what is just the normal seasonal move for HIP in Q1? two, what was the impact of less destocking? three, you know, what was the impact of just underlying demand improvement, if any, in the segment? Matthew, good morning. I think it's probably a large part is the impact of a reduction of destocking. Because of the sharp interest rate increase last year and the mortgage rate, high mortgage rates, people really reduced home purchases. I think many of the builders are very cautious and destocked and used up all their products that are in the inventory. Even then, you still compare with first quarter 2022, that's kind... Maybe a high peak of our infrastructure business is still 21% reduction in volume. It's quite a dramatic reduction despite that compared with fourth quarter last year, it was improvement. The second quarter usually is the strongest quarter construction, as we said earlier. Hopefully we as we read that, some of the home builders, they had incentives and everything else to increase the demand. We read that recently they are reducing some incentives because the demand's coming back. The 10-year average treasury rate is coming down from the four odd percent. It's down to 3.4%. It is a benefit from the mortgage interest rate. We are seeing some improvement, but it's still a bit early. We don't know how the economy will pan out second half of this year. I think most people are reading that housing will be poor this year compared to last year, it will improve 2024 and 2025 sequentially. Great. Thanks for that. It looks like Southeast Asia spot caustic prices are down about 20% versus Q1 levels. Is that mostly a function of weaker industrial demand? How likely is it that those weaker Asia prices will flow into the U.S. market? As Asia was exporting PVC to have more excess caustic, coupled with a weak economy, generally speaking, in Asia, caustic price came down. We believe that export or Asia caustic price has bottomed out. We're seeing signs of improvement. Also the economy in Asia are improving gradually, especially China. That will help. We think that the demand will absorb some of those excess capacity. Thank you. You're welcome. Thank you so much. Our next question comes from the line of Arun Viswanathan of RBC Capital Markets. Your line is now open. Great. Thanks for taking my question. Congrats on the quarter. I guess first question is you guys commented on some improving trends in, you know, PVC and epoxy. Could you just elaborate on those? I guess, is that, you know, do you expect that to continue and then maybe accelerate with China reopening? Thanks. Well, PVC demand should be improving from fourth quarter level and into the first quarter and second quarter. You know, I think some of the consultants, Chemical Market Analytics, are saying that they foresee the rest of the year pretty much flat in prices, which shows that this is domestic U.S. price. They are looking at somewhat improving prices for next year. This is forward looking. I think people believe that we've seen the bottom of fourth quarter last year, and things will improve gradually as demand improves. Great. Thanks. Maybe you can just update on your thoughts on caustic as you move through the year. You still expect declines. Is there really any stabilization there? Thanks. Yeah. Again, Caustic price has probably reached very high levels on first end of last year, early this year. The forecast by consultants are saying the price will decline gradually throughout the year and stabilize by the end of the year next year. Well, it depends again on the U.S. industrial economy, because caustic is used very broadly in many areas. Pulp and paper right now is a bit weak, reflecting the economy. Who knows, things will improve. You know, alumina, aluminium is demand is increasing, the infrastructure construction is increasing. Also mining, or lithium mining, other kind of mining is increasing. Demand in caustic could improve. We don't know. As we said earlier in our call, that, caustic and chlorine prices are very high levels, and we are benefiting from those, with lower power costs and natural gas prices. We're benefiting from the margins. Thanks. Thank you so much. You're welcome. Our next question comes from the line of David Begleiter of Deutsche Bank. Your line is now open. Morning. Morning. Albert, we've seen Brent oil price drop from the high 80s to the low 70s in the last three weeks. How you think about that drop and its impact on both the U.S. cost advantage and your own ethylene chain profitability? Well, definitely, it would have some impact. As you know, most of the world, probably two-thirds or so are using naphtha as feedstock for the ethylene cracker. As oil price drop, naphtha price drop, it improves the economics. Especially in Asia, the naphtha-based ethylene, polyethylene producers have been losing money selling polyethylene based on the naphtha price. This should help them improve the economics. We are still very competitive with ethane cracking. Our cost is really, well, definitely is the lowest among all the feedstocks, and still a wide margin apart from naphtha cracking. Very good. Just on U.S. polyethylene prices, I don't believe the April contract has settled yet. How do you think about Q2 U.S. polyethylene prices as they trend through the quarter? Yeah. I think the polyethylene price for April has been flat. It came out settled at flat. I think again, some of the consultants are looking pretty much flat price through the rest of the year. The industry has announced five cents a pound price increase, actually it's for April, and now push it to May. Industry believes that the demand is improving. The price has been low compared with last year. It dropped sharply since the second half of last year, that we deserve some improvements in margins. Time will tell whether the five cents can be or part of it can be realized in May or second quarter of this year. Thank you very much. You're welcome. Thank you so much. Our next question comes from the line of Aleksey Yefremov of KeyBank. Your line is now open. Good morning, everyone. Albert, can you talk about your utilization in the U.S. PVC assets and chlor-alkali assets? If you can provide any comments about your levels and also relative to industry averages? The, there's some turnaround going on and some plant outages. I think the chlor-alkali running on 80% and PVC is in the mid-80s operating rates, and also reflecting the supply-demand dynamics globally. Thanks, Albert. Staying with PVC, how do you see domestic market if we try to break it down in terms of demand between new housing, R&R and infrastructure? If you do know the kind of the rough percentages between those three buckets? The infrastructure is the smallest component, and housing, I would think the largest component, as we show in our HIP separations. We show the sales of the housing and infrastructure segment, part of the segment. Within housing, probably two-thirds of the sales are related to repair and modeling in general. New homes is one third. You know, there are lots and lots, I don't know how many homes, close to 100 million homes out there. We're talking about 1.5 million, 1.4 million new home construction. Depending on the repair and modeling, what they use, whether it's siding, PVC window, you know, roofing, so on and so forth. They use fair amount of PVC in repair and modeling than in new construction. New construction is still a big part of it. For Westlake, we're about 50/50 with our capacities of in our HIP business. Our sales split about 50/50% goes into new construction homes and 50% go to repair and remodeling. You could see that in the first quarter, repair and remodeling was fairly resilient, even though we saw some continued concern in the new start levels. You could see that repair and remodeling in the first quarter was resilient. You know, there are forecasters that would continue to suggest that repair and remodeling will continue to grow this year, probably at lower rates than last year, but nevertheless remain resilient through 2023. Thanks a lot. You're welcome. Thank you so much. Our next question comes from the line of Hassan Ahmed of Alembic Global Advisors. Your line is now open. Steve, you know, question around polyethylene. You know, you talked a bit about the pricing dynamics. You know, obviously there's a fair bit of capacity coming online this year. As I sort of sit there and look through the different grades of polyethylene, you guys are fairly sort of exposed to the LDPE side of it. It seems that the capacity growth on the LDPE side is far more debted than the other grades. Should we sort of expect to see divergent sort of pricing trends between the different grades? This is Albert. Morning. Good question. We always felt that LDPE should be separately priced. As you get low and high density, they're all different, they're all polyethylene, but serve different segments. Somehow our industry lump all together. As you said, all the new capacity and those haven't started yet, but have mechanical completion, but having difficulty starting up. Those are primarily high density and linear low density and not LDPE. I think the LDPEs already started. Nevertheless, it has impact on all the industry. They lump together, and the pricing ups and downs are linked together. Understood. Understood. One point I want to make is that the margins, even the price move up and down together, the margin for LDPE is far better than the margins for making linear low density or high density. Fair enough. Fair enough. Earning better margin. Yeah. Okay. Now on the epoxy side of it, Albert, you know, you obviously, you know, the commentary sounded incrementally positive. Is it fair to assume that potentially Q4 and Q1 were the trough and sort of things start cycling up from there? If that is the case, you know, this inflection, will this be primarily sort of demand-driven with sort of China picking up and the like, or will it be partly demand-driven and partly supply-driven as well? Where sort of in that, in that sort of positive commentary you're baking in maybe some capacity rationalization in the marketplace, maybe less disruptive pricing. You know, you talked obviously about China exporting less now. You know, just trying to figure out supply and demand wise, what you guys are seeing there. Yeah, that's a very good question. I think for PVC, we think you're right, that China's demand increasing, especially with real estate, which is a big component of the economy, and the government try to stimulate that part as well, that demand should increase, a less export and pricing should improve and so is profit. On the epoxy side, a bit different. It's not as a big business. The Chinese are building, looking for the windmills, and windmills are just getting back in China of new construction. Certainly, everybody needs renewable energy at lower cost. Takes time for that come into place. Meanwhile, as one of the earlier questions that they have been exporting fair amount overseas. As the year progresses and next year, I think next two years, definitely the demand for epoxy globally will increase, improve. This year is still a, maybe it's a bottom of the cycle year. Very helpful. Thank you so much. You're very welcome. Thank you so much. Again, to ask a question, please press star one one on your telephone and wait for your name to be announced. Our next question comes from the line of Angel Castillo of Morgan Stanley. Your line is now open. Hi, this is Turner Hinrichs on for Angel. I was wondering if you could give us a little more color on your epoxy business results, specifically, you know, how they compare to 1Q 2022 of last year and 4Q 2022 of last year as well. As part of that, would you say your epoxy business is gaining share in the market? How is Westlake's positioning evolving in light of the ongoing imports from Asia and strategic moves by one of your peers? Good question. You know, the market was meaningfully stronger in the first quarter 2022. You certainly have seen, you know, a change in market dynamic in terms of demand from first quarter of 2022. I'd say that with the energy power circumstance that we have, let's say in Europe, European epoxy is in a much better position to be able to compete. You're right, there is still imports of Asian epoxy into the European market, though, as the Asian markets begin to rebound, less so in terms of the volume of epoxy resins into that market. You know, when you think of the domestic market for our epoxy resin, as Albert noted earlier, it's a stronger position that we see there in terms of overall market demand. So I would say that, you know, the troughs that we saw in fourth quarter as everybody was destocking across all product chains, you know, we certainly saw that really come to an end at the end of the fourth quarter. I would say that we see some recovery as we get into 2023, with 2024 and beyond being stronger markets as we see greater demand for wind energy and windmill contracts being let in 2022, 2023, and 2024 and beyond. Those will take time before those windmills are constructed and demand really gets much stronger. I'd say 2023 is one of those years where we see a strengthening of the market, but not fully back by any means back to the levels that we saw in 2021 and first quarter of 2022. Thank you so much. That's great color. another one. Could we get a little more color on the export mix picture for PVC and PE respectively? Can you give any comments on your domestic and export sales mix and mix shifts relative to levels seen in the industry? This is Albert. The industry exports for polyethylene is about 41% in March. Year to date, about 42%. For PVC, it's about 34% for March and 38% year to date. For Westlake, we export less than industry average in general. All right. Thank you so much. You're welcome. Thank you so much. There are no further questions at this time. The QA session has now ended. I would like to turn it back to Jeff for closing comments. Thank you. Thank you again for participating in today's call. We hope you will join us again for our next conference call to discuss our second quarter 2023 results. Thank you for participating today's Westlake Corporation's first quarter conference call. As a reminder, this call will be available for replay beginning two hours after the call has ended. The replay can be accessed via Westlake's website. Goodbye.