Huntsman announced Q3 2024 earnings

Peter R. Huntsman, Chairman, President, and CEO, said: "The third quarter was consistent with our outlook of a stable environment at trough conditions in our core construction and industrial markets. Total volumes for the Company did improve 5% in the quarter versus the prior year with stable margins sequentially. Construction and transportation account for approximately three quarters of our volumes and we expect near term trough conditions to persist through a seasonally lower fourth quarter. For the medium to long-term, interest rate cuts by the Federal Reserve and ECB, combined with government stimulus in China, should have a positive impact across our global portfolio, primarily in construction. In the meantime, we are focused on what we control - improving our cost position and our balance sheet strength to maintain optionality to invest in our core businesses in a disciplined manner. We were pleased by the success of our strong bond offering in the third quarter which points to the long-term strength of our portfolio and anticipation of market improvements in the coming years."

Segment Analysis for 3Q24 Compared to 3Q23

Polyurethanes

The increase in revenues in our Polyurethanes segment for the three months ended September 30, 2024 compared to the same period of 2023 was primarily due to higher sales volumes, partially offset by lower MDI average selling prices. Sales volumes increased primarily due to improved demand and share gains in certain markets. MDI average selling prices decreased primarily due to less favorable supply and demand dynamics. The decrease in segment adjusted EBITDA was primarily due to lower MDI average selling prices and lower equity earnings from our minority-owned joint venture in China, partially offset by lower fixed costs and higher sales volumes.

Performance Products

The increase in revenues in our Performance Products segment for the three months ended September 30, 2024 compared to the same period of 2023 was primarily due to higher sales volumes, partially offset by lower average selling prices. Sales volumes increased primarily due to improved demand in fuels and lubes and coatings and adhesives markets. Average selling prices decreased primarily due to competitive pressure. The decrease in segment adjusted EBITDA was primarily due to lower average selling prices and unfavorable sales mix, partially offset by higher sales volumes and lower fixed costs.

Advanced Materials

The decrease in revenues in our Advanced Materials segment for the three months ended September 30, 2024 compared to the same period of 2023 was primarily due to lower average selling prices, partially offset by higher sales volumes. Average selling prices decreased primarily due to unfavorable sales mix. Sales volumes increased in our aerospace and coatings markets driven by market recovery, partially offset by lower demand in our industrial market. The decrease in segment adjusted EBITDA was primarily due to higher fixed costs.

Corporate, LIFO and other

For the three months ended September 30, 2024, adjusted EBITDA from Corporate and other was a loss of $34 million as compared to a loss of $41 million for the same period of 2023. The increase in adjusted EBITDA from Corporate and other resulted primarily from decreases in corporate overhead costs and unallocated foreign currency exchange losses, partially offset by an increase in LIFO valuation losses.

Liquidity and Capital Resources

During the three months ended September 30, 2024, our free cash flow from continuing operations was $93 million as compared to $117 million in the same period of 2023. As of September 30, 2024, we had approximately $1.7 billion of combined cash and unused borrowing capacity.

During the three months ended September 30, 2024, we spent $41 million on capital expenditures from continuing operations as compared to $50 million in the same period of 2023. During 2024, we expect to spend between approximately $180 million to $190 million on capital expenditures.

Income Taxes

In the third quarter of 2024, our effective tax rate was 115% and our adjusted effective tax rate was 41%. We expect our 2024 adjusted effective tax rate to be between approximately 30% to 34%. We expect our long-term adjusted effective tax rate to be between approximately 22% to 24%.

Earnings Conference Call Information

A conference call was held on Tuesday, November 5, 2024, to discuss the third quarter 2024 financial results.

Upcoming Conferences

During the fourth quarter 2024, a member of management is expected to present at:
Morgan Stanley Global Chemicals, Agriculture and Packaging Conference, November 12, 2024
Citi's Basic Materials Conference, December 3, 2024
Goldman Sachs Industrials and Materials Conference, December 4, 2024

A webcast of the presentation, if applicable, along with accompanying materials will be available at www.huntsman.com/investors.