Distributions and Net Income Per Limited Partner Unit

9 Months Ended

Sep. 30, 2021

Distributions and Net Income Per Limited Partner Unit

On November 1, 2021, the board of directors of Westlake Chemical Partners GP LLC ("Westlake GP"), the Partnership's general partner, declared a quarterly cash distribution for the three months ended September 30, 2021 of $0.4714 per unit. This distribution is payable on November 29, 2021 to unitholders of record as of November 12, 2021.

Distributions are declared subsequent to quarter end; therefore, the table below represents total cash distributions declared from earnings of the related periods pertaining to such distributions.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net income attributable to the Partnership	$	12,790	$	18,535	$	53,035	$	51,142
Less:
Limited partners' distribution declared on common units	16,600		16,591		49,788		49,772


Net income in excess of distribution (distribution in excess of net income)	$	(3,810)	$	1,944	$	3,247	$	1,370

Net income per unit applicable to common limited partner units is computed by dividing the respective limited partners' interest in net income by the weighted-average number of common units outstanding for the period. Because the Partnership has more than one class of participating securities, it uses the two-class method when calculating the net income per unit applicable to limited partners. The classes of participating securities include common units and incentive distribution rights. Net income attributable to the Partnership is allocated to the unitholders in accordance with their respective ownership percentages in preparation of the consolidated statements of changes in equity. However, when distributions related to the incentive distribution rights are made, net income equal to the amount of those distributions is first allocated to the general partner before the remaining net income is allocated to the unitholders based on their respective ownership percentages. Basic and diluted net income per unit is the same because the Partnership does not have any potentially dilutive units outstanding for the periods presented.


	Three Months Ended September 30, 2021
	Limited Partners' Common Units		Incentive Distribution Rights		Total
Net income attributable to the Partnership:
Distribution	$	16,600	$	—	$	16,600
Distribution in excess of net income	(3,810)		—		(3,810)
Net income	$	12,790	$	—	$	12,790
Weighted average units outstanding:
Basic and diluted	35,209,976				35,209,976
Net income per limited partner unit:
Basic and diluted	$	0.36


	Three Months Ended September 30, 2020
	Limited Partners' Common Units		Incentive Distribution Rights		Total
Net income attributable to the Partnership:
Distribution	$	16,591	$	—	$	16,591
Net income in excess of distribution	1,944		—		1,944
Net income	$	18,535	$	—	$	18,535
Weighted average units outstanding:
Basic and diluted	35,194,545				35,194,545
Net income per limited partner unit:
Basic and diluted	$	0.53


	Nine Months Ended September 30, 2021
	Limited Partners' Common Units		Incentive Distribution Rights		Total
Net income attributable to the Partnership:
Distribution	$	49,788	$	—	$	49,788
Net income in excess of distribution	3,247		—		3,247
Net income	$	53,035	$	—	$	53,035
Weighted average units outstanding:
Basic and diluted	35,203,609				35,203,609
Net income per limited partner unit:
Basic and diluted	$	1.51


	Nine Months Ended September 30, 2020
	Limited Partners' Common Units		Incentive Distribution Rights		Total
Net income attributable to the Partnership:
Distribution	$	49,772	$	—	$	49,772
Net income in excess of distribution	1,370		—		1,370
Net income	$	51,142	$	—	$	51,142
Weighted average units outstanding:
Basic and diluted	35,194,545				35,194,545
Net income per limited partner unit:
Basic and diluted	$	1.45

The amended Partnership Agreement provides that the Partnership will distribute cash each quarter to all the unitholders, pro rata, until each unit has received a distribution of $1.2938. If cash distributions to the Partnership's unitholders exceed $1.2938 per common unit in any quarter, the Partnership's unitholders and Westlake, as the holder of the Partnership's incentive distribution rights, will receive distributions according to the following percentage allocations:


	Marginal Percentage Interest in Distributions
Total Quarterly Distribution Per Unit	Unitholders		IDR Holders
Above $1.2938 up to $1.4063	85.0	%	15.0	%
Above $1.4063 up to $1.6875	75.0	%	25.0	%
Above $1.6875	50.0	%	50.0	%

The Partnership's distribution for the three months ended September 30, 2021 did not exceed the $1.2938 per unit threshold, and, as a result, no distribution was made with respect to the Partnership's incentive distribution rights to Westlake, as the holder of the Partnership's incentive distribution rights.

Distribution Per Common Unit

Distributions per common unit for the three and nine months ended September 30, 2021 and 2020 were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Distributions per common unit	$	0.4714	$	0.4714	$	1.4142	$	1.4142