Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Westlake Corporation third 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, November 2nd, 2023. I would now like to turn the call over to today's host, Jeff Holy, Westlake's Vice President and Treasurer. Sir, you may begin. Thank you, Maria. Good morning, everyone, and welcome to the Westlake Corporation conference call to discuss our third 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, which we refer to as 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 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 disclosed in Westlake's Form 10-K for the year ended December 31st, 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 third 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 of that 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, November 2nd, 2023, and therefore, you are 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 third quarter 2023 results. For the third quarter of 2023, we reported sales of $3.1 billion, net income of $285 million, and EBITDA of $682 million, including record HIP segment EBITDA of $327 million. Our HIP segment benefited from resilient North American housing and infrastructure construction activities, while higher operating rates in our PEM segment drove sequential volume growth, despite generally lower average selling prices. The strength of our business portfolio was highlighted by the quarterly earnings achieved by our HIP segment, where EBITDA exceeded the segment's previous record, set in the second quarter of 2022, during a much stronger housing and overall economic environment. HIP segment EBITDA margin of 29% was also a record, driven by our strong brands and disciplined pricing in a period of lower material costs, as well as solid progress in our cost-saving initiatives. The EBITDA, generally in our HIP segment, typically comes from with lower capital requirements than in our PEM segment and converts to cash flow generation at a higher rate, which is an additional benefit of our vertical integration and downstream diversification strategy. We'll have more to say about our HIP results and outlook later in the call, but I want to congratulate all of our HIP employees on their record performance. Overall, our third quarter results reflected the advantages of our portfolio diversification. While our PEM businesses experienced pricing pressure and margin compression, our housing and infrastructure businesses delivered significant cost and earnings improvement. As a result, Westlake EBITDA margin of 22% was consistent with our second quarter margin of 21% and our prior year margin of 20%, demonstrating the earnings and cash flow stability of our strategy to be a vertically integrated performance and essential materials producer, combined with our value-added portfolio of leading offerings for housing and infrastructure products. Our consistent focus on cash flow generation enabled Westlake to deliver $696 million in cash flow from operations in the third quarter and $1.8 billion year to date. The solid cash flow generation, the strength in the business, and our confidence in the company's future allowed us to increase our dividend by 40% in August, and to return approximately $180 million to shareholders since January. I would now like to turn our call over to Steve to highlight more detail on our financial results for the third quarter of 2023. Thank you, Albert, and good morning, everyone. Westlake reported net income of $285 million or $2.20 per share in the third quarter of 2023 on sales of $3.1 billion. Net income for the third quarter of 2023 decreased $116 million from the third quarter of 2022, as a result of lower average selling prices and integrated margins, as well as lower sales volumes. When compared to the second quarter of 2023, net income decreased by $12 million in the third quarter of 2023, due primarily to lower prices and integrated margins for most of our products in our PEM segment, partially offset by higher operating rates and sales volumes. For the third quarter of 2023, our utilization of the FIFO method of accounting had a $50 million unfavorable impact in pre-tax earnings compared to what earnings would have been if we reported on the LIFO method. This is only an estimate and has not been audited. Before I discuss our segment results, I wanna provide some high-level thoughts on the quarter. We were pleased with HIP segment's ability to deliver value to our customers while managing cost, to produce record earnings against a challenging North American housing backdrop. These results are a testament to the strength of our brands and the importance of our products to our customers. We believe this record performance illustrates the benefits of our vertical integration and diversification strategy, as lower cost materials used in our HIP segment drove margin expansion at a time when margins in our PEM segment compressed due to sales price decreases. The net result of this downstream integration was that Westlake delivered a 22% EBITDA margin in the third quarter, compared to 21% in the second quarter and 20% in the third quarter of 2022, despite a period of commodity price declines. While we are pleased with the performance of our HIP segment, the financial results in our PEM segment continue to reflect soft global demand, and we are taking actions to address the challenging macroeconomic conditions. We continue to implement targeted actions, deliver cost savings in 2023. We now expect our company-wide cost reduction program to achieve $95 million-$110 million of cost savings in 2023, up from the previous $75 million-$105 million target, after we achieved approximately $80 million of cost savings to date in 2023. We are taking a prudent approach to managing cost and capital investments in markets and regions that don't contribute to our global feedstock and energy cost advantage or our vertical integration strategy. Moving to the specifics of our segment performance, our housing and infrastructure product segment produced record quarterly EBITDA of $327 million on $1.1 billion of sales. The solid EBITDA growth of $73 million from the previous year EBITDA of $254 million. The year-over-year increase in EBITDA was due to lower materials cost that more than offset an 8% decrease in average sales price, driving an expansion in our HIP segment EBITDA margin to 29% from 20% in the prior year period. When compared to the second quarter of 2023, HIP segment sales of $1.1 billion were driven by 7% growth in sales volume, which more than offset a 5% decrease in average sales prices. Housing product sales of $963 million in the quarter increased $45 million due to solid sales volume growth in pipe and fittings applications and siding and trim. That more than offset lower average selling prices. Meanwhile, infrastructure product sales of $181 million in the third quarter of 2023 decreased $16 million from the second quarter of 2023, primarily due to lower average selling prices and sales volumes in our compound business. The overall higher HIP segment sales in the third quarter of 2023, along with lower materials cost, drove an improvement in EBITDA margin to 29% from the 22% in the second quarter. As a result, HIP segment EBITDA increased $83 million from the second quarter to $327 million in the third quarter. Turning to our performance in Essential Materials segment, third quarter 2023 sales were $2 billion, with EBITDA of $339 million. When compared to the third quarter of 2022, EBITDA fell by $222 million due to lower average selling prices, particularly for performance materials, in addition to lower sales volume, largely in epoxy, driven by weak global demand and increased competition from Asian imports. PEM segment EBITDA of $339 million in the third quarter decreased $96 million from the second quarter of 2023, as improved sales volumes, particularly for PVC resin and polyethylene, were more than offset by a combination of lower average selling prices, particularly for caustic soda, PVC resin and epoxy, higher feedstock and energy cost, and certain charges.... Net sales in our PEM segment in the third quarter were 8% lower sequentially, as volume gains over the second quarter were more than offset by price declines, which, coupled with certain charges, drove a decline in segment earnings. As the quarter progressed, we saw modest improvement in pricing in some markets, such as PVC and polyethylene, while other markets continue to face pricing pressure. Our PEM segment is globally competitive, with a well-invested, vertically integrated position, processing a low-cost feedstock as we continue to grow our specialty and differentiated product offerings. Shifting to our balance sheet, as of September 30, 2023, cash and cash equivalents were $3.1 billion, and total debt was $4.9 billion, with a staggered long-term fixed rate debt maturity schedule. For the third quarter of 2023, net cash provided by operating activities was $696 million, while capital expenditures were $245 million, resulting in free cash flow of $451 million, which reflects our strong cash generative business model. We continue to look for opportunities to strategically deploy our balance sheet in order to create long-term value. Now, let me provide some guidance for your models. Based on the current view of demand and prices, and taking into account typical seasonality, we expect fourth quarter revenue in our housing and infrastructure product segment to between $875 million-$975 million, with EBITDA margins in the mid-teens. We also expect to achieve the $95 million-$110 million of savings in 2023 that I previously mentioned. We continue to expect total capital expenditures for 2023 to be approximately $1 billion, which is unchanged from our earlier guidance and is similar to our depreciation and amortization run rate. For the full year of 2023, we now expect our effective tax rate to be approximately 21%, which we will continue to expect our cash interest expense to be approximately $160 million. Now I'll turn the call back over to Albert to provide a current outlook of our business. Albert? Thank you, Steve. Entering the fourth quarter, the economic backdrop remains challenging. The rate of inflation remains high, and the mortgage rates are at the highest level in over 20 years. These inflationary and affordability pressures are negatively impacting consumer and housing demand. This volatile economic backdrop, combined with ongoing geopolitical turmoil and a normal seasonal decline in demand, leads us to expect challenging conditions to continue throughout the fourth quarter. The uncertain macroeconomic outlook makes it difficult to predict demand trends over the next several quarters. That said, we believe that customer inventories are much lower today than they were at this time last year, which, combined with recent pricing momentum in some of our key products, should reduce the degree of customer destocking activity in both our PEM and HIP segments relative to what we experienced in the fourth quarter of last year. As we head into 2024, our leading market position with a broad product portfolio and strong brands, combined with our globally advantaged low-cost position, enable Westlake to respond to evolving market trends while executing our business strategies. Westlake has demonstrated the solid cash generative nature of our business, resulting in $2.6 billion in cash flow from operations on a trailing 12-month basis. We will continue to maintain a strong balance sheet and invest in our long-term strategic priorities while continuing to return capital to shareholders. Notably, our quarterly dividend has doubled over the last five years as a testament to our commitment to returning value to our shareholders. We are also reaffirming our commitment to our broader stakeholder community to improve the sustainability of our products and operations. We continue to introduce new products into the market to meet customers' sustainability requirements. In September, we were pleased to introduce our Pivotal line of one pellet solutions. This innovative portfolio of products incorporates up to 45% post-consumer recycled material into resin pellets, with properties comparable to that of virgin resin. The product line has already achieved GreenCircle certification, which independently validates our post-consumer recycled content efforts, and we're seeing increasing interest from our customers for this more sustainable material. Separately, I'm pleased to announce that we have achieved an 18% reduction in our Scope 1 and Scope 2 CO2 emissions intensities since 2016, moving Westlake closer to our goal of a 20% reduction by 2030. As we continue to achieve significant progress, we will look for opportunities to increase our emission intensity reduction goals. Before we open the call to our questions, I want to provide some closing thoughts on the third quarter and our outlook. Our third quarter results highlight the benefits of our vertical integration and downstream diversification strategy. A key component of the strategy is the goal to reduce volatility, earnings, and cash flow, while maximizing growth potential. Recognizing that profitability can shift up or down the value chain, depending on economic conditions, we believe that it's important to have a broad product portfolio with strong brands, supported by a manufacturing culture focused on low-cost operational excellence. In the third quarter, this strategy proved very beneficial as profitability moved to our downstream HIP businesses. Through the investment that we have made in our HIP segments in recent years, we're able to capture this value shift to enhance the stability of our EBITDA margin and cash flows. As we look forward, we seek additional ways to broaden our business through organically and through acquisitions to further this strategy. Thank you very much for listening to our third 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 is available on our website, and a replay of this teleconference will be available starting two hours after this call has ended. Maria, we will now take questions. 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 star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile our Q&A roster. Our first question comes from the line of Patrick Cunningham from Citi. Your line is now open. Hi, good morning. What drove the pricing declines in the HIP segment for the quarter? Was it broad-based, or are there any specific areas of pricing pressure to highlight? And so any sort of outlook into 4Q and into next year would be helpful. Yeah. So when you think about some of the, the pricing decline we saw, certainly, you know, we're seeing certainly, in pockets and some of these portfolio offerings where there is pressure. Certainly, you can see when you think about the quarter compared to second quarter, we certainly had nice volume, volume pickup, 7% volume pickup over Q2. But certainly, as we all know, affordability is an issue in the housing sector, and so certainly to continue to be performing very solidly as we did, in fact, record results, there is some pressure in certain segments within that portfolio within HIP. Got it. And then just a similar follow-up. You know, I appreciate the sales and EBITDA guide for the HIP segment. You know, the narrower 4Q sales range seems to point maybe towards the bottom end of your previous range. Is this some indication that, you know, the business might be more challenged beyond just what you would expect from typical seasonality, or are there any other negative trends to point to there? Well, it is a combination, Patrick, of both seasonal play, plus we've seen certainly the compounding effect of interest rates and impacting affordability. But certainly, it's a combination of both that impact of rising interest rates for mortgages and certainly a seasonal play. So that's really the two primary drivers within the guides that we've provided. Great. Thank you. You're welcome. Thank you. One moment while we compile our next question. Our next question comes from the line of Frank Mitsch from Fermium Research. Your line is now open. Hey, good morning. If I could, if I could follow up on, on HIP. Obviously, very impressive, EBITDA margins of 29% in the third quarter. Based on your guidance, it looks like the year is probably gonna come in close to like 22% or so for the full year, which is up, 200 basis points from last year. How do you think about normalized EBITDA margins in HIP, you know, as you look out, you know, into 2024 and beyond? Yeah, Frank, good question, and certainly, I think you see from the strong portfolio offering that we had and the acceptance by our broad customer base, that we continue to perform even very well in a period of rising interest rates. And so I think the portfolio we offer does provide an ability to deliver really strong and compelling EBITDA margins in this business. It is a combination of what I would call exterior building products, of course, our infrastructure products, going into some of the infrastructure markets that we're seeing, both pipes and fittings. And of course, our portfolio adds compounds, which goes into a variety of applications, whether it is building wire or other applications in automotive or medical. It's a broad portfolio offering, and I think the portfolio we offer attracts, I think, the kind of good margins that you see even in the face of these strong headwinds we've seen, given interest rates and some of the pricing pressures. So I do believe that it's performing incredibly well, and we expect it to continue to be strongly performing. That's helpful. Good morning. Yeah, hi. Yeah, go ahead, please. Hi, Albert. I just want to comment that I think Steve, in the past and have all said, our target for the HIP business EBITDA margin is the high teens. Now it can go up and down, depending on the time of the season. Usually, it's maybe higher, second and third quarter, lower, first quarter and fourth quarter. I understood. And then obviously, this does appear to be somewhat of an anomalous year, and you know, I was trying to get at that. But I also think that, you know, the cost improvement that you talked about, you've raised your target for the year, you know, fairly significantly. You did $80 million year to date. How much of that cost improvement is coming from the HIP segment versus PEM? It's actually well, well across the portfolio. Everything from procurement opportunities in both PEM and in HIP, as well as logistics opportunities. So it really is across both segments, roughly, let's say, equally so. Interesting. Okay, thank you so much. You're welcome. Thank you. One moment for our next question. Our next question comes from the line of Aleksey Yefremov from KeyBanc Capital Markets. Your line is now open. Great, this is Ryan on for Aleksey. Thanks for taking my question. My first question, you know, would be around current dynamics, you know, in Chlor-alkali. Have recent capacity reductions by some of your peers, you know, had a positive impact on the market thus far? And are there any areas like where you're seeing incremental demand for your product? Yeah. As we know that chlorine, the biggest user of chlorine is for PVC, and the biggest user of PVC is construction. And as Steve mentioned, not only we are impacted by the high interest rate, high mortgage rate impacting affordability on new housings and also on the repair remodeling activities, but also seasonality is impacting it. So I think the operating rate tends to go down for both PVC and for Chlorine and Chlor-alkali, especially in the fourth quarter, maybe even part of the first quarter. Helpful. Thank you. And then, you know, can you just talk about what you're seeing in the epoxy market? Seems like there might have been some stability in prices here in October. You know, albeit it's at a low level, and it seems like costs are kind of continuing to eat at margins. Just any commentary you can give us there would be much appreciated. Thank you, as always. Yes. As Steve mentioned, that our epoxy business is impacted by imports, both Asian imports to Europe and Asian imports to U.S. The prices, both in Europe and U.S., have dropped and very close now to the import price. We see some stability, even though the margin is pretty poor. Wonderful. Thank you. One moment for our next question. Our next question comes from the line of Bhavesh Lodaya from BMO Capital Markets. Your line is now open. Yes, this is Bhavesh for John. Good morning, Albert and Steve. Congrats on the quarter and the continued outperformance on the HIP segment. If I compare your performance in HIP this year versus last, during the quarter, so volumes are roughly flat, and your margins are up 8% year-over-year. Is that all price versus cost, or is there an element of changes in the product mix of what you are selling? No, so when you think about year-over-year results, of course, you're right, volumes are flat. But I would say that given the headwinds we've seen related to affordability driven by higher rates, it really is, I think, a testament to the strength of the portfolio offered. Obviously, we've seen some pressure on price either quarter-over-quarter or year-over-year. But nevertheless, I think the strength relative to the year-over-year, with 2022 a much stronger year than 2023, is a testament to really the strength that we have with our customers and the offerings that HIP does provide. I think if you think about the performance we had quarter-over-quarter, a nice pickup in volume of 7% from 2Q to 3Q, which tells you, even in this market that we've seen, where right, where rates are at 8%+ for 30-year mortgages, still strong performance from a volume perspective in the portfolio in our HIP business. Got it. And then a question on the PE markets here. So we are seeing international prices move higher in line with the feedstocks and pretty heavy volumes going from the U.S. into exports in general. How do you see the mix going ahead, and any color on your outlook for PE pricing year? Yeah, the U.S.'s industry is exporting in the high 40-odd% in polyethylene. And with new additional capacity coming up, U.S. local demand, domestic demand cannot absorb the capacities. So I think as the new capacity cut comes up, more export, more volume will be exported, which it was coming at a lower price, of course. Thank you. You're welcome. Thank you. One moment for our next question. Our next question comes from the line of Matthew Blair from TPH. Your line is now open. Hey, good morning, Albert. You know, with $3.1 billion of cash, could you assess the M&A landscape? What kind of areas would you be interested in adding in? And is it fair to think that if you did make an acquisition, it's more likely that would be in HIP than PEM? Matthew, it's Steve. I would say that as we look across the landscape, we look equally hard at both the material side in our PEM segment as well as in our building products space. You know, we're looking for opportunities where there is good, compelling value, good, compelling synergies that are immediately accretive to the bottom line. And so as you've seen, we're willing to invest where we find the right opportunities we have over the last year or two. But we're looking for opportunities in both segments, not necessarily focusing on one or the other, but those that really drive real value at the bottom line. And while we do have cash on the balance sheet, it doesn't compel us to really go out and do just a transaction to spend that cash. It's incredibly easy to spend the cash. It's always more challenging to get the return, and as you know, we're really focused on that return basis. That's where our focus will be as synergistic opportunities on either the HIP or the PEM segment, and we'll continue to look for those. Sounds good. And then, Steve, you mentioned the raw material tailwinds in, in HIP. Would that be PVC? And, and if so, are there any other raws that helped you out in the quarter? And also, were there any one-time boosts in, in HIP? The impact on the one-time items were, or the period items were really all in PEM. And as it relates to the reduction in inputs, it was really vinyl. We've seen actually that being the biggest input that had a benefit to the contribution of margin expansion in the HIP business. Thank you. You're welcome. Thank you. One moment for our next question. Our next question comes from the line of Michael Sisson from Wells Fargo. Your line is now open. Good morning, Mike. Are you there? Maria, maybe we put Mike back in the queue, and let's take the next question. Will do. One moment for that next question. Our next question comes from the line of Arun Viswanathan from RBC Capital Markets. Your line is now open. Arun, are you there? Maria, do we have a connectivity issue? Not that I am seeing. I, everything looks clear. Do we want to try to go on to the next person? Yeah, let's put Arun also in the next queue, and let's go to this, the next question, please. One moment for that question. Our next question comes from the line of David Begleiter from Deutsche Bank. Your line is now open. Thank you. Can you hear me? Yes, David, we can. Thank you. Thank you. So you mentioned some in PEM, some one-time, impacts in the quarter. How much were they, and should they all be a tailwind into, into Q4, and are there any other one-timers in Q4? David, I see none at this stage in terms of impacts in Q4, and I would say these all were attributable to the PEM segment, and this was a $20 million item that we called out. Very good. And Albert and Steve, looking at 2024, do you have an early view on HIP volumes next year, given the weakness you're seeing in North American construction? Yeah. We expect the HIP general housing industry to still be impacted by the high mortgage rate, high interest rate. So until the Fed starts lowering rates, we don't see any recovery in housing demand or in building-related demand. Would you expect your volumes to be down next year in HIP? Possibly. Thank you. Wonderful. Thank you. One moment for our next question. Our next question comes from the line of Duffy Fischer from Goldman Sachs. Your line is now open. Yeah, good morning, guys. Question around- Good morning. Epoxy. With the oversupply we're seeing largely out of China, which of your end markets are being impacted by that, which are not, and have you seen kind of a change in global trade flows for epoxy? I think, the coatings generally are the largest market for epoxy, and as well as, areas such as composite and windmills. I think generally, China has the largest capacity in the world, by a big stretch over the next producer. And the economy in China really has not recovered, even though the government has put in several steps of incentives. Again, we're heading to winter season, and things are slowing down in China as well. So I think it, it's the impact is across the board in all epoxy activities. Okay. And then do you think the industry, if we roughly stay at these levels, 'cause you talked about, you know, construction may still struggling next year, does the industry need to do something strategic? Meaning, you know, are people running kind of below cash breakeven, do you think, in some parts of the world, or is this just something we're gonna have to wait out until we get some demand rebound? I think generally speaking, if you talk about just chemical industry or- Oh, epoxies. I'm sorry, epoxy, epoxies in general. Epoxy. Yeah. Yeah. As I said, one of the questions earlier was where we're seeing prices, and as mentioned, that prices pretty much has dropped in both U.S. European markets to meet imports. And we're seeing the imports start slowing down as well because of cost pressures, oil price going up, and the economy is not great, and even companies in China are curtailing production, or some of the plants are not running. So we are seeing people taking actions to reduce production, reduce losses all across the world. So I think very few epoxy people we know are making any money. Great. Thank you, guys. You're welcome. One moment for our next question. Our next question comes from the line of Kevin McCarthy from Vertical Research Partners. Your line is now open. Yes, good morning. Good morning. Albert, I'd appreciate your updated view of PVC resin prospects moving into 2024. The U.S. contract price seems to be trending about flat, but seems also that there's a lot of supply length in China against the backdrop of, you know, dislocated property sector there. So how do you see that playing out? Would you anticipate rationalization of capacity or throttling back? What is your view on PVC for next year? I think, at least in the U.S. market, PVC demand were impacted by, both domestic housing construction and as well as the global economy. As you know, about a third of the U.S. production PVC are exported, and been at that ratio for quite a while. So, U.S. has the lowest cost to produce PVC in the world. We are benefited from low-cost natural gas for generating power, for making Chlor-alkali, and low-cost natural gas for producing ethane, which is predominant feedstock for the U.S. ethylene producers. And, you know, half of PVC is ethylene, and half is chlorine. And, so we have the lowest cost producer in the world to produce PVC, and we can export anywhere in the world and compete. The issue then is margin. China, one thing is going on, is that the Chinese government are moving less and less in the carbide. About 80% of the Chinese capacities are carbide-based, which is a high-cost and high-polluting process. And the Chinese government having containment of any new capacities in the carbide process, and they're switching to ethylene-based PVC production, which comes at a higher cost, because ethylene in China is all based on naphtha, which comes from cracking refining oil. So the cost base is higher, and so they are less able to compete on a global basis. Also, from that sense, again, our US-based producers are much better positioned to compete globally against even Chinese exports. So at the end is the global economy, and China construction activity is a big part of the Chinese economy and is really going through a recession right now. So until the construction and housing activity in China improves, you're not gonna see improvements in profitability in vinyl business in China either, which will impact the rest of the world as well. Thank you for that. And then, Steve, I had maybe two housekeeping ones for you. Apologies if I missed it, but how did the $50 million FIFO headwind that you referenced split between your segments? And also, curious, do you have any fourth quarter maintenance turnarounds planned? Yeah, and so, about three-quarters of that is in PEM, Kevin. And, and your second question was? Tell me again. Are you planning to turn around any of your manufacturing plants in the current quarter? In the current quarter, only a small activity from a maintenance level perspective. Our bigger activity will be in 2024, when we have an ethylene turnaround in 2024. But otherwise, in the fourth quarter, it's really small maintenance activity, not attributable to any significant turnaround levels. Okay. Thank you very much. ... You're welcome. One moment for our next question. Our next question comes from the line of Josh Spector from UBS. Your line is now open. Hi, good morning, everyone. It's Chris Perrella on for Josh. Just following the guidance for HIP for the fourth quarter, what, what's causing the halving of margins sequentially? Is that higher raw material costs, and is that final headwinds? You know, what are the moving pieces, I guess, up in the third quarter on the margin and then down in the fourth quarter, sequentially there? Yeah. A big piece of that, headwind is really attributable to seasonal slowdown and so a diminished demand level. We're also seeing, since we're a FIFO reporter, some of that cost will also roll through that, will roll through in the fourth quarter in terms of some of the feedstock cost will come through as well. And of course, the compounding of interest rates that we've seen will continue to be a headwind in terms of affordability. So it's a combination of those factors. All right, appreciate that, Steve. And then just one quick follow-up on the caustic soda. You know, Albert and Steve, I'd just like to hear your thoughts on the caustic soda market as we move through the year, given the weaker demand outlook for PVC. Yeah, caustic soda, generally, the global demand correlates well with the global GDP growth, and global GDP is really not doing that well. So this year, we have experienced price declines almost every month of the year. And I think, at least the consultants are saying that after the price erosion of this year, I think they're expecting another $20 for November and December to drop. But next year, there'll be more stable and more price increases coming up. Of course, all these subject to global economic demand, and it's hard to forecast these days. I appreciate that. Thanks, for the time this morning. You're welcome. Thank you. One moment for our next question. Our next question comes from the line of Hassan Ahmed from Alembic Global Advisors. Your line is now open. Morning, Albert and Steve. You know, wanted to revisit one of the earlier questions around, Chlor-alkali supply-demand fundamentals, particularly as they relate to your views on what, you know, ECU pricing and margins will do on a go-forward basis. Look, I mean, you know, the, the ECU pricing and margins have obviously come down over the last couple of quarters, but one of your larger competitors, you know, over the last few years, has shut down a fair bit of capacity and has recently announced the, the temporary idling of some capacity as well. And they were very vocal in saying that by the second quarter of 2024, they expect to see a positive inflection, on the ECU pricing and margin side of it. So are your views in agreement with that? Yeah. Yes, generally speaking, we agree. Westlake, because of our historical strategy of being more fully integrated, we have downstream manufacturing of chlorine to PVC and then also further integration to HIP businesses. So we have a lot more channel to sell products, both domestically and export, along the whole vinyls chain, which help us to moderate our operations and everything else. So as we explained earlier, the last quarter, the value chain really has moved down to the downstream HIP business. And since we have, as mentioned, price declines for caustic throughout this whole year, and consultants are forecasting much more stable and actually improving prices for next year, we're expecting things to get better. Now, this is subject to global economic conditions. We don't know what's going to happen. With high interest rate, we're still seeing, feeling the impact of high interest rate, which, until that reverses, will have a detrimental effect on demand, both in the U.S. and overseas as well. Fair enough. Fair enough. And as a follow-up, Albert, you know, I mean, we sure seem to be living through some unprecedented times. You know, the destock across a variety of sort of chemical product chains, including yours, has been quite severe, you know, 2022 onwards. And you know, if we were to simplistically sort of put that into historical context, you know, obviously a massive destock cycle like the one we've seen, you know, is followed by a pretty impressive restock cycle, right? But, I mean, is it fair to assume that, you know, on a go-forward basis, we may actually eventually see a pretty impressive restock cycle? Or now, with rates where they are, with housing doing what it's doing, with China doing what it's doing, are we in a new sort of paradigm shift? Absolutely. I think, you know, as you mentioned, we've been seeing destocking pretty much through the whole year, and I think most companies mentioned earlier, this destocking activity is over. The question is, what is the true demand? And people are really, because high interest rate, high, inventory costs are expensive to carry, people are really, ordering what they need. The issue is their need changes, so, and they don't know, you know, they're very short-term oriented now. And so as demand came down, we have more ability to serve. As you know, back in 2022, if our HIP business, we have, backlog over a year on certain products, and that's not good for our customers. So now, by and large, most of our businesses, we are ready to serve our customers in relatively short notice. So we, as producer, we carry a bit more inventory to serve our customers, and which also benefits from any import competition and the businesses. But having said it, is that we don't know, and customers don't know what is the true demand, and we are ordering—they are ordering as only they need, and we're supplying them. And as you said, when the market turns and they want more of a reasonable higher level inventory, then there will be a multiplier effect, if that you can say that, to production in the future. But who knows when that market turn will be? On the housing side, generally speaking, springtime, which start probably from February, March, is when people are seeing, benefits of the weather, and they start, putting sticks in the ground and do all that. So we should be see some signs of improvement on housing, in February, March related. But who knows? Well, time will tell. Very helpful, Albert. Thank you so much. You're very welcome. Thank you. As a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. One moment while we prepare our next question. Our next question comes from the line of Michael Sison from Wells Fargo. Your line is now open. Hey, guys. Can you hear me? Yes, we can, Mike. Good morning. Oh, okay, good. Yes. Sorry. Albert, what do you think you're gonna run your Chlor-alkali facilities in the fourth quarter in terms of the operating rate, and how do you think about that as you head into next year, if demand continues to be sort of challenged? Yeah. Our operating rate pretty much follows the industry operating rates. As mentioned earlier, generally, the demand goes down in the fourth quarter and first quarter, so our industry operating rate tends to go down and picks up again in the second and third quarter. This is the general pattern. Of course, as Steve mentioned, we have not only seasonality, but also impact of high interest rate on the demand for construction activities. So those are compounded effects. Got it. And then when you think about PVC demand in 2024, if demand weakens as you head into 2024, you know, how do you think you'll run your facilities to sort of compensate for that? Will you pull back some capacity or just sort of run it as is? Yeah. The industry has pulled back. We have pulled back capacities when the demand is not there. But as I mentioned that, in the vinyl industry, we are one of the more fully integrated companies going all the way from making ethylene and chlorine, down to making pipes, windows, and sidings and compounds. And the further you go down, the more easy for you to reach out a broader customer base. And for PVC resin, we don't export much HIP business, but PVC resin, as mentioned, the industry exports about 35% of its production, and we are the lowest cost producer in the world for PVC, even among American vinyl producers. So long as the margin is good enough, our industry will export PVC and will also benefit the upstream chlorine/ethylene side. Got it. Thank you. You're welcome. Thank you. One moment for our last question. Our final question comes from the line of Arun Viswanathan from RBC Capital Markets. Your line is now open. Great. Good morning. Thanks for taking my question. Hope you're all well. So I guess my first question... I'll have two questions. So first question is, on HIP. You know, when you, I think, discussed this segment in the past, you've noted kind of a 15%-20% EBITDA margin range. You've done very well in executing here. And do you think that's still the appropriate range to consider? And could you potentially go well beyond that range in a higher volume environment? I'll start with that. Thanks. You know, and so, Arun, when we think about the demand environment we've been in, we've been guiding to kind of the upper teens, and you see that we've exceeded that in a couple quarters. This quarter was record quarter with 29%.... But I think in a much stronger demand environment, given the fact that we've got a very broad product offering, there is a potential for that. But I think as we've seen here, we've got to see a much stronger demand market to be able to then move margins and pricing up. You know, we've got a very strong headwind currently with seasonality coming into play and with mortgage rates 8%+ for 30-year mortgages, that's quite a bit of a sticker shock for most homebuyers. And so to be able to get a better, a tighter market, if you will, we need a much better backdrop in terms of affordability and a more constructive macroeconomic outlook. There's a lot of uncertainty in the market these days, and that's causing a lot of people to be cautious about deploying personal capital into repair and remodeling and other construction. But yeah, there's potential, but we need a better macroeconomic backdrop. Okay, thanks, Steve. And, just on, PEM, as well, another question, I had was, I think you touched on the footprint on, Chlor-alkali. You know, you're operating rates kind of following the, the industry. But what about Epoxy? I mean, do you, do you think that there's further rationalization, required there, just given the weakness that we've experienced over the last couple of years? What's it gonna take to really, see a better market there, understanding that China appears to be the biggest driver, but, could, could there also be some capacity reductions on your part that would, that accelerate that? Thanks. Yeah, that's a good question. As we discussed earlier, that there's overcapacity in the world, and in China, build overcapacity for their anticipation of demand for both EV, lightweighting cars, windmills, generating the renewable power. So that's the reason why, China has built all these capacities. But for whatever reason, the EV demand is not that going that strong. I think adoption it still takes a while globally, and China is exporting EV cars all over the world and meeting competition. Same time, the renewable power, the windmill blades, the various activities going on, even in the U.S. and Europe, a lot of people want to do it, but the cost increases. So and all these issues are impacting the pace of further development in windmills. We think will come, and at Westlake, we have technology that can make over 100 m long blade. The longer the blades, the better the properties or efficiency of the windmills. So it just takes time. And, I think China, some of the older plants in China, not integrated plants, are running low rates or shut down. So just like anything, it'll be rationalization going on, and it takes time. But I think, the demand for epoxy globally is still very strong. Especially in the U.S., you have infrastructure. We build the bridges and it, or, or the ship and so on and so forth, and they all need coatings, car needs coatings, and, the windmill blades and epoxies and electronics. So the global demand for epoxy, we are very, optimistic on the long-term demand. I think short-term, we have these issues to go through, and I think the industry will go through that. Thank you. At this time, the Q&A session has now ended. Are there any closing remarks, Jeff? Thanks. Thank you again for participating in today's call. We hope you'll join us again for our next conference call to discuss our fourth quarter and year-end 2023 results. Thank you for participating in today's Westlake Corporation third 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.