Alpek - Q1 2026 Earnings Analysis

Performance Highlights

Alpek reported first-quarter 2026 comparable EBITDA of $150 million, a 50% sequential and 19% year-over-year improvement that came in ahead of the company's own initial expectations. Total revenues reached $1.69 billion, roughly flat year-over-year, while reported EBITDA of $162 million surged 133% quarter-over-quarter, aided by a $23 million favorable inventory adjustment from rising raw material prices.

The single most important driver was the sharp recovery in Polyester segment margins, with Chinese PET reference margins averaging $246 per ton in March — up 41% sequentially and 44% year-over-year — as Middle East geopolitical tensions disrupted global petrochemical and feedstock flows. Supporting this, the Plastics and Chemicals segment delivered comparable EBITDA of $60 million, up 8% both sequentially and year-over-year on stronger polypropylene volumes, while the emerging Natural Gas business contributed an incremental $3–5 million from Gulf Coast winter storm pricing opportunities in January.

Management Outlook and Forward Catalysts

For the second quarter, management guided for comparable EBITDA of at least $200 million, citing Chinese PTA reference margins approaching $300 per ton, polypropylene spreads expanding by at least four cents per pound in April, and ocean freight costs to South America near $110 per metric ton. Based on this trajectory, Alpek indicated it expects to reach or exceed the high end of its full-year guidance range of $550 million, though it declined to formally revise guidance given uncertainty around the duration of Middle East supply disruptions.

The central investor debate heading into Q2 centres on how long elevated spreads persist and whether Alpek can translate this tailwind into durable deleveraging toward its 2.5x net debt-to-EBITDA target, currently at 3.9x. Bulls will watch for continued margin strength, $30–50 million in additional non-strategic asset sales in the second half, and the $20–30 million EBITDA uplift expected from the three-year $70 million polypropylene differentiated-products investment, while bears will focus on a potential rapid normalization of PET spreads once Middle East flows resume, working capital consumption from rising raw material prices, and execution risk at the Oman facility.