Exhibit 99.1

 

 

FOR IMMEDIATE RELEASE

Investor Relations:

Media:

October 27, 2014

Kurt Ogden

Gary Chapman

The Woodlands, TX

(801) 584-5959

(281) 719-4324

NYSE: HUN

 

 

 

HUNTSMAN RELEASES THIRD QUARTER 2014 RESULTS;

REPORTS STRONG EARNINGS

 

Third Quarter 2014 Highlights

 

·                  Adjusted EBITDA was $356 million compared to $376 million in the prior year period.  Third quarter 2014 EBITDA was impacted by approximately $30 million resulting from an unplanned manufacturing disruption of PO/MTBE.

 

·                  Adjusted diluted income per share was $0.60 compared to $0.54 in the prior year period.

 

·                  Net income attributable to Huntsman Corporation was $188 million compared to $64 million in the prior year period.  Third quarter 2014 was impacted by $94 million of tax benefit resulting from foreign tax credit elections.

 

 

 

Three months ended

 

Nine months ended

 

 

 

September 30,

 

June 30,

 

September 30,

 

In millions, except per share amounts, unaudited

 

2014

 

2013

 

2014

 

2014

 

2013

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$

2,884

 

$

2,842

 

$

2,988

 

$

8,627

 

$

8,374

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to Huntsman Corporation

 

$

188

 

$

64

 

$

119

 

$

361

 

$

87

 

Adjusted net income(1)

 

$

147

 

$

132

 

$

145

 

$

397

 

$

272

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted income per share

 

$

0.76

 

$

0.26

 

$

0.48

 

$

1.47

 

$

0.36

 

Adjusted diluted income per share(1)

 

$

0.60

 

$

0.54

 

$

0.59

 

$

1.62

 

$

1.12

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA(1)

 

$

293

 

$

303

 

$

327

 

$

881

 

$

664

 

Adjusted EBITDA(1)

 

$

356

 

$

376

 

$

363

 

$

1,048

 

$

900

 

 

See end of press release for footnote explanations

 



 

The Woodlands, TX — Huntsman Corporation (NYSE: HUN) today reported third quarter 2014 results with revenues of $2,884 million and adjusted EBITDA of $356 million.

 

Peter R. Huntsman, our President and CEO, commented:

 

“We continue to see growing demand for key products such as MDI polyurethanes, amines, maleic, aerospace composites and environmentally friendly textile dyes and chemicals.  Third quarter EBITDA from these products increased more than $30 million compared to the prior year.  The strength in our earnings is underpinned by broad earnings growth from multiple products across our divisions.

 

Recently, we successfully completed the acquisition of Rockwood’s performance additives and specialty titanium dioxide businesses.  We have plans to deliver $130 million of annual synergies by the middle of 2016 at which point we believe this acquisition will yield approximately $0.70 of earnings per share to shareholders.”

 

Segment Analysis for 3Q14 Compared to 3Q13

 

Polyurethanes

 

The increase in revenues in our Polyurethanes division for the three months ended September 30, 2014 compared to the same period in 2013 was primarily due to improved MDI sales partially offset by lower PO/MTBE sales volumes.  MDI average selling prices increased in the Americas and European regions, partially offset by lower component pricing in China.  PO/MTBE average selling prices were essentially unchanged.  MDI sales volumes increased 5% primarily as a result of improved demand in the Americas and Asian regions and across most major markets.  PO/MTBE sales volumes decreased primarily as a result of an unplanned manufacturing disruption at our Port Neches, Texas facility in the third quarter of 2014 which resulted in lower EBITDA of approximately $30 million.  The decrease in adjusted EBITDA was due to lower PO/MTBE earnings, partially offset by higher MDI earnings.

 

Performance Products

 

The decrease in revenues in our Performance Products division for the three months ended September 30, 2014 compared to the same period in 2013 was due to lower sales volumes partially offset by higher average selling prices.  Sales volumes decreased primarily due to the sale of our European surfactants business in the second quarter of 2014 partially offset by increased sales volumes in amines and maleic anhydride.  Average selling prices increased in response to higher raw materials costs and continued strong market conditions for amines, maleic anhydride and specialty surfactants.  The increase in adjusted EBITDA was primarily due to higher contribution margins.

Advanced Materials

 

Revenues in our Advanced Materials division for the three months ended September 30, 2014 compared to the same period in 2013 were essentially unchanged.  Average selling prices increased in all regions and across most markets primarily due to certain price increase initiatives and our focus on higher value markets.  Sales volumes decreased primarily due to our restructuring efforts.  During the fourth quarter of 2013 we closed two of our base resins production units as we focus on higher value markets such as aerospace, transportation and industrial, and coatings and construction.  The increase in adjusted EBITDA was primarily due to higher contribution margins and improved sales mix as a result of our restructuring efforts.

 

2



 

Textile Effects

 

The increase in revenues in our Textile Effects division for the three months ended September 30, 2014 compared to the same period in 2013 was primarily due to higher average selling prices, partially offset by lower sales volumes.  Average selling prices increased primarily in response to higher raw material costs and improved sales mix.  Sales volumes decreased primarily due to the de-selection of lower value business.  The increase in adjusted EBITDA was primarily due to higher contribution margins as a result of our restructuring efforts partially offset by higher selling, general and administrative costs.

 

Pigments

 

The increase in revenues in our Pigments division for the three months ended September 30, 2014 compared to the same period in 2013 was primarily due to higher sales volumes, partially offset by lower average selling prices.  Sales volumes increased primarily as a result of higher end-use demand, particularly in the Asia-Pacific region.  Average selling prices decreased primarily as a result of high industry inventory levels.  The decrease in adjusted EBITDA was primarily due to lower contribution margins, partially offset by higher sales volumes.

 

Corporate, LIFO and Other

 

Adjusted EBITDA from Corporate, LIFO and Other decreased by $5 million to a loss of $49 million for the three months ended September 30, 2014 compared to a loss of $44 million for the same period in 2013.  The decrease was primarily attributable to $6 million of unallocated foreign currency exchange losses in 2014 primarily attributable to the decline in value of the Euro versus the U.S. dollar.

 

Liquidity, Capital Resources and Outstanding Debt

 

As of September 30, 2014, we had $1,365 million of combined cash and unused borrowing capacity compared to $1,048 million at December 31, 2013.

 

On October 1, 2014, we successfully completed the acquisition of the Performance Additives and Titanium Dioxide businesses of Rockwood for $1.04 billion in cash and assumed certain unfunded European pension liabilities.  The acquisition was funded by a new $1.2 billion term loan due 2021.

 

In August 2014, we increased the capacity of our existing revolving credit facility by $200 million to $600 million.  In October 2014, our revolving credit facility was increased by an additional $25 million.

 

Total capital expenditures for the three months ended September 30, 2014 were $137 million.  We expect to spend approximately $550 million on capital expenditures in 2014, net of reimbursements and including approximately $50 million in the fourth quarter for the newly acquired Rockwood businesses and the Augusta, Georgia color pigments facility which is under construction.

 

During the three months ended September 30, 2014, assets from our 1999 acquisition of Imperial Chemical Industries became fully depreciated.  Including the impact from the newly acquired Rockwood businesses we expect our fourth quarter depreciation to be approximately $105 million.

 

Income Taxes

 

During the three months ended September 30, 2014 we recorded an income tax benefit of $40 million and paid $13 million in cash for income taxes.  Our adjusted effective income tax rate for the three months ended September 30, 2014 was 29%.

 

During the third quarter of 2014 as a result of extensive planning efforts, we made elections on our U.S. tax returns from 2008 through 2013 which allowed us to utilize substantially all of our U.S. foreign tax credits. As a

 

3



 

result of utilizing these assets that had been subject to a valuation allowance, we recognized a one-time income tax benefit of $94 million.

 

We expect our full year 2014 adjusted effective tax rate to be approximately 30% including the impact of the Rockwood acquisition.

 

Earnings Conference Call Information

 

We will hold a conference call to discuss our third quarter 2014 financial results on Monday, October 27, 2014 at 10:00 a.m. ET.

 

Call-in numbers for the conference call:

U.S. participants

(888) 713 - 4214

International participants

(617) 213 - 4866

Passcode

19019076

 

In order to facilitate the registration process, you may use the following link to pre-register for the conference call. Callers who pre-register will be given a unique PIN to gain immediate access to the call and bypass the live operator. You may pre-register at any time, including up to and after the call start time. To pre-register, please go to:

 

https://www.theconferencingservice.com/prereg/key.process?key=PKYANFAXN

 

Webcast Information

 

The conference call will be available via webcast and can be accessed from the company’s website at ir.huntsman.com.

 

Replay Information

 

The conference call will be available for replay beginning October 27, 2014 and ending November 3, 2014.

 

Call-in numbers for the replay:

U.S. participants

(888) 286 - 8010

International participants

(617) 801 - 6888

Replay code

68570447

 

4



 

Table 1 — Results of Operations

 

 

 

Three months ended

 

Nine months ended

 

 

 

September 30,

 

September 30,

 

In millions, except per share amounts, unaudited

 

2014

 

2013

 

2014

 

2013

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$

2,884

 

$

2,842

 

$

8,627

 

$

8,374

 

Cost of goods sold

 

2,369

 

2,335

 

7,157

 

7,067

 

Gross profit

 

515

 

507

 

1,470

 

1,307

 

Operating expenses

 

274

 

272

 

811

 

808

 

Restructuring, impairment and plant closing costs

 

39

 

37

 

91

 

110

 

Operating income

 

202

 

198

 

568

 

389

 

Interest expense

 

(49

)

(48

)

(148

)

(146

)

Equity in income of investment in unconsolidated affiliates

 

2

 

3

 

6

 

6

 

Loss on early extinguishment of debt

 

 

 

 

(35

)

Other (expense) income

 

(1

)

 

 

2

 

Income before income taxes

 

154

 

153

 

426

 

216

 

Income tax benefit (expense)

 

40

 

(81

)

(39

)

(105

)

Income from continuing operations

 

194

 

72

 

387

 

111

 

Loss from discontinued operations, net of tax(2)

 

 

(2

)

(7

)

(4

)

Net income

 

194

 

70

 

380

 

107

 

Net income attributable to noncontrolling interests, net of tax

 

(6

)

(6

)

(19

)

(20

)

Net income attributable to Huntsman Corporation

 

$

188

 

$

64

 

$

361

 

$

87

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA(1)

 

$

356

 

$

376

 

$

1,048

 

$

900

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income(1)

 

$

147

 

$

132

 

$

397

 

$

272

 

 

 

 

 

 

 

 

 

 

 

Basic income per share

 

$

0.77

 

$

0.27

 

$

1.49

 

$

0.36

 

Diluted income per share

 

$

0.76

 

$

0.26

 

$

1.47

 

$

0.36

 

Adjusted diluted income per share(1)

 

$

0.60

 

$

0.54

 

$

1.62

 

$

1.12

 

 

 

 

 

 

 

 

 

 

 

Common share information:

 

 

 

 

 

 

 

 

 

Basic shares outstanding

 

242.6

 

239.8

 

241.8

 

239.5

 

Diluted shares

 

246.7

 

242.5

 

245.7

 

242.1

 

Diluted shares for adjusted diluted income per share

 

246.7

 

242.5

 

245.7

 

242.1

 

 

See end of press release for footnote explanations

 

5



 

Table 2 — Results of Operations by Segment

 

 

 

Three months ended

 

 

 

Nine months ended

 

 

 

 

 

September 30,

 

Better /

 

September 30,

 

Better /

 

In millions, unaudited

 

2014

 

2013

 

(Worse)

 

2014

 

2013

 

(Worse)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

Polyurethanes

 

$

1,321

 

$

1,306

 

1

%

$

3,831

 

$

3,734

 

3

%

Performance Products

 

762

 

779

 

(2

)%

2,360

 

2,278

 

4

%

Advanced Materials

 

310

 

309

 

 

953

 

966

 

(1

)%

Textile Effects

 

221

 

198

 

12

%

693

 

602

 

15

%

Pigments

 

318

 

310

 

3

%

976

 

974

 

 

Eliminations and other

 

(48

)

(60

)

20

%

(186

)

(180

)

(3

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

2,884

 

$

2,842

 

1

%

$

8,627

 

$

8,374

 

3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Adjusted EBITDA(1):

 

 

 

 

 

 

 

 

 

 

 

 

 

Polyurethanes

 

$

187

 

$

215

 

(13

)%

$

551

 

$

567

 

(3

)%

Performance Products

 

129

 

122

 

6

%

362

 

287

 

26

%

Advanced Materials

 

57

 

39

 

46

%

156

 

98

 

59

%

Textile Effects

 

14

 

8

 

75

%

52

 

8

 

550

%

Pigments

 

18

 

36

 

(50

)%

67

 

78

 

(14

)%

Corporate, LIFO and other

 

(49

)

(44

)

(11

)%

(140

)

(138

)

(1

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

356

 

$

376

 

(5

)%

$

1,048

 

$

900

 

16

%

 

See end of press release for footnote explanations

 

6



 

Table 3 — Factors Impacting Sales Revenues

 

 

 

Three months ended

 

 

 

September 30, 2014 vs. 2013

 

 

 

Average Selling Price(a)

 

 

 

 

 

 

 

 

 

Local

 

Exchange

 

Sales Mix

 

Sales

 

 

 

Unaudited

 

Currency

 

Rate

 

& Other

 

Volume(b)

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Polyurethanes

 

 

 

6

%

(5

)%

1

%

Performance Products

 

5

%

 

1

%

(8

)%

(2

)%

Advanced Materials

 

4

%

1

%

3

%

(8

)%

 

Textile Effects

 

17

%

1

%

3

%

(9

)%

12

%

Pigments

 

(5

)%

1

%

1

%

6

%

3

%

Total Company

 

3

%

1

%

 

(3

)%

1

%

 

 

 

Nine months ended

 

 

 

September 30, 2014 vs. 2013

 

 

 

Average Selling Price(a)

 

 

 

 

 

 

 

 

 

Local

 

Exchange

 

Sales Mix

 

Sales

 

 

 

Unaudited

 

Currency

 

Rate

 

& Other

 

Volume(b)

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Polyurethanes

 

(1

)%

 

3

%

1

%

3

%

Performance Products

 

4

%

 

(1

)%

1

%

4

%

Advanced Materials

 

6

%

 

5

%

(12

)%

(1

)%

Textile Effects

 

17

%

(1

)%

2

%

(3

)%

15

%

Pigments

 

(5

)%

2

%

 

3

%

 

Total Company

 

2

%

 

(1

)%

2

%

3

%

 


(a) Excludes sales from tolling arrangements, by-products and raw materials.

(b) Excludes sales from by-products and raw materials.

 

7



 

Table 4 — Reconciliation of U.S. GAAP to Non-GAAP Measures

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax

 

Net Income

 

Diluted Income

 

 

 

EBITDA

 

Benefit (Expense)

 

Attrib. to HUN Corp.

 

Per Share

 

 

 

Three months ended

 

Three months ended

 

Three months ended

 

Three months ended

 

 

 

September 30,

 

September 30,

 

September 30,

 

September 30,

 

In millions, except per share amounts, unaudited

 

2014

 

2013

 

2014

 

2013

 

2014

 

2013

 

2014

 

2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP(1)

 

$

293

 

$

303

 

$

40

 

$

(81

)

$

188

 

$

64

 

$

0.76

 

$

0.26

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition expenses and integration costs

 

10

 

9

 

(2

)

(1

)

8

 

8

 

0.03

 

0.03

 

Impact of certain foreign tax credit elections

 

N/A

 

N/A

 

(94

)

 

(94

)

 

(0.38

)

 

Loss from discontinued operations, net of tax(2)

 

 

2

 

N/A

 

N/A

 

 

2

 

 

0.01

 

Discount amortization on settlement financing associated with the terminated merger

 

N/A

 

N/A

 

 

 

 

2

 

 

0.01

 

Certain legal settlements and related expenses

 

1

 

 

 

 

1

 

 

 

 

Amortization of pension and postretirement actuarial losses

 

12

 

19

 

(2

)

(2

)

10

 

17

 

0.04

 

0.07

 

Restructuring, impairment and plant closing and transition costs

 

40

 

43

 

(6

)

(4

)

34

 

39

 

0.14

 

0.16

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted(1)

 

$

356

 

$

376

 

$

(64

)

$

(88

)

$

147

 

$

132

 

$

0.60

 

$

0.54

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted income tax (benefit) expense

 

 

 

 

 

 

 

 

 

64

 

88

 

 

 

 

 

Net income attributable to noncontrolling interests, net of tax

 

 

 

 

 

 

 

 

 

6

 

6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted pre-tax income(1)

 

 

 

 

 

 

 

 

 

$

217

 

$

226

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted effective tax rate

 

 

 

 

 

 

 

 

 

29

%

39

%

 

 

 

 

 

 

 

 

 

Income Tax

 

Net Income

 

Diluted Income

 

 

 

EBITDA

 

(Expense) Benefit

 

Attrib. to HUN Corp.

 

Per Share

 

 

 

Three months ended

 

Three months ended

 

Three months ended

 

Three months ended

 

 

 

June 30,

 

June 30,

 

June 30,

 

June 30,

 

In millions, except per share amounts, unaudited

 

2014

 

2014

 

2014

 

2014

 

 

 

 

 

 

 

 

 

 

 

GAAP(1)

 

$

327

 

$

(43

)

$

119

 

$

0.48

 

Adjustments:

 

 

 

 

 

 

 

 

 

Acquisition expenses and integration costs

 

9

 

(2

)

7

 

0.03

 

Loss from discontinued operations, net of tax(2)

 

2

 

N/A

 

 

 

Gain on disposition of businesses/assets

 

(2

)

1

 

(1

)

 

Certain legal settlements and related expenses

 

2

 

 

2

 

0.01

 

Amortization of pension and postretirement actuarial losses

 

12

 

(4

)

8

 

0.03

 

Restructuring, impairment and plant closing and transition costs

 

13

 

(3

)

10

 

0.04

 

 

 

 

 

 

 

 

 

 

 

Adjusted(1)

 

$

363

 

$

(51

)

$

145

 

$

0.59

 

 

 

 

 

 

 

 

 

 

 

Adjusted income tax expense

 

 

 

 

 

51

 

 

 

Net income attributable to noncontrolling interests, net of tax

 

 

 

 

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted pre-tax income(1)

 

 

 

 

 

$

201

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted effective tax rate

 

 

 

 

 

25

%

 

 

 

 

 

 

 

 

 

Income Tax

 

Net Income

 

Diluted Income

 

 

 

EBITDA

 

(Expense) Benefit

 

Attrib. to HUN Corp.

 

Per Share

 

 

 

Nine months ended

 

Nine months ended

 

Nine months ended

 

Nine months ended

 

 

 

September 30,

 

September 30,

 

September 30,

 

September 30,

 

In millions, except per share amounts, unaudited

 

2014

 

2013

 

2014

 

2013

 

2014

 

2013

 

2014

 

2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP(1)

 

$

881

 

$

664

 

$

(39

)

$

(105

)

$

361

 

$

87

 

$

1.47

 

$

0.36

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition expenses and integration costs

 

27

 

14

 

(6

)

(2

)

21

 

12

 

0.09

 

0.05

 

Impact of certain foreign tax credit elections

 

N/A

 

N/A

 

(94

)

 

(94

)

 

(0.38

)

 

Loss from discontinued operations, net of tax(2)

 

9

 

3

 

N/A

 

N/A

 

7

 

4

 

0.03

 

0.02

 

Discount amortization on settlement financing associated with the terminated merger

 

N/A

 

N/A

 

 

(2

)

 

5

 

 

0.02

 

Gain on disposition of businesses/assets

 

(2

)

 

1

 

 

(1

)

 

 

 

Loss on early extinguishment of debt

 

 

35

 

 

(13

)

 

22

 

 

0.09

 

Certain legal settlements and related expenses

 

3

 

8

 

 

(2

)

3

 

6

 

0.01

 

0.02

 

Amortization of pension and postretirement actuarial losses

 

37

 

56

 

(10

)

(13

)

27

 

43

 

0.11

 

0.18

 

Restructuring, impairment and plant closing and transition costs

 

93

 

120

 

(20

)

(27

)

73

 

93

 

0.30

 

0.38

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted(1)

 

$

1,048

 

$

900

 

$

(168

)

$

(164

)

$

397

 

$

272

 

$

1.62

 

$

1.12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted income tax expense

 

 

 

 

 

 

 

 

 

168

 

164

 

 

 

 

 

Net income attributable to noncontrolling interests, net of tax

 

 

 

 

 

 

 

 

 

19

 

20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted pre-tax income(1)

 

 

 

 

 

 

 

 

 

$

584

 

$

456

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted effective tax rate

 

 

 

 

 

 

 

 

 

29

%

36

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See end of press release for footnote explanations

 

8



 

Table 5 — Reconciliation of Net Income to EBITDA

 

 

 

Three months ended

 

Nine months ended

 

 

 

September 30,

 

June 30,

 

September 30,

 

In millions, unaudited

 

2014

 

2013

 

2014

 

2014

 

2013

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to Huntsman Corporation

 

$

188

 

$

64

 

$

119

 

$

361

 

$

87

 

Interest expense

 

49

 

48

 

51

 

148

 

146

 

Income tax (benefit) expense from continuing operations

 

(40

)

81

 

43

 

39

 

105

 

Income tax benefit from discontinued operations(2)

 

 

 

(2

)

(2

)

 

Depreciation and amortization

 

96

 

110

 

116

 

335

 

326

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA(1)

 

$

293

 

$

303

 

$

327

 

$

881

 

$

664

 

 

See end of press release for footnote explanations

 

 

Table 6 — Selected Balance Sheet Items

 

 

 

September 30,

 

June 30,

 

December 31,

 

In millions

 

2014

 

2014

 

2013

 

 

 

(unaudited)

 

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

Cash

 

$

592

 

$

412

 

$

529

 

Accounts and notes receivable, net

 

1,676

 

1,870

 

1,575

 

Inventories

 

1,788

 

1,847

 

1,741

 

Other current assets

 

438

 

319

 

314

 

Property, plant and equipment, net

 

3,703

 

3,776

 

3,824

 

Other assets

 

1,212

 

1,218

 

1,205

 

 

 

 

 

 

 

 

 

Total assets

 

$

9,409

 

$

9,442

 

$

9,188

 

 

 

 

 

 

 

 

 

Accounts payable

 

$

1,176

 

$

1,162

 

$

1,113

 

Other current liabilities

 

672

 

725

 

769

 

Current portion of debt

 

274

 

257

 

277

 

Long-term debt

 

3,752

 

3,809

 

3,633

 

Other liabilities

 

1,139

 

1,181

 

1,267

 

Total equity

 

2,396

 

2,308

 

2,129

 

 

 

 

 

 

 

 

 

Total liabilities and equity

 

$

9,409

 

$

9,442

 

$

9,188

 

 

9



 

Table 7 — Outstanding Debt

 

 

 

September 30,

 

June 30,

 

December 31,

 

In millions

 

2014

 

2014

 

2013

 

 

 

(unaudited)

 

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

Debt:

 

 

 

 

 

 

 

Senior credit facilities

 

$

1,339

 

$

1,339

 

$

1,351

 

Accounts receivable programs

 

235

 

245

 

248

 

Senior notes

 

1,219

 

1,258

 

1,061

 

Senior subordinated notes

 

890

 

890

 

891

 

Variable interest entities

 

220

 

231

 

247

 

Other debt

 

123

 

103

 

112

 

 

 

 

 

 

 

 

 

Total debt - excluding affiliates

 

4,026

 

4,066

 

3,910

 

 

 

 

 

 

 

 

 

Total cash

 

592

 

412

 

529

 

 

 

 

 

 

 

 

 

Net debt- excluding affiliates

 

$

3,434

 

$

3,654

 

$

3,381

 

 

Table 8 — Summarized Statement of Cash Flows

 

 

 

Three months ended

 

Nine months ended

 

 

 

September 30,

 

September 30,

 

In millions, unaudited

 

2014

 

2014

 

2013

 

 

 

 

 

 

 

 

 

Total cash at beginning of period(a)

 

$

412

 

$

529

 

$

396

 

 

 

 

 

 

 

 

 

Net cash provided by operating activities

 

360

 

343

 

388

 

Net cash used in investing activities

 

(135

)

(337

)

(388

)

Net cash (used in) provided by financing activities

 

(41

)

62

 

12

 

Effect of exchange rate changes on cash

 

(5

)

(6

)

(2

)

Change in restricted cash

 

1

 

1

 

 

 

 

 

 

 

 

 

 

Total cash at end of period(a)

 

$

592

 

$

592

 

$

406

 

 

 

 

 

 

 

 

 

Supplemental cash flow information:

 

 

 

 

 

 

 

Cash paid for interest

 

$

(54

)

$

(145

)

$

(152

)

Cash paid for income taxes

 

(13

)

(156

)

(60

)

Cash paid for capital expenditures

 

(137

)

(351

)

(295

)

Depreciation and amortization

 

96

 

335

 

326

 

 

 

 

 

 

 

 

 

Changes in primary working capital:

 

 

 

 

 

 

 

Accounts and notes receivable

 

139

 

(161

)

(146

)

Inventories

 

(3

)

(112

)

118

 

Accounts payable

 

37

 

131

 

(18

)

 

 

 

 

 

 

 

 

Total cash used in primary working capital

 

$

173

 

$

(142

)

$

(46

)

 


(a) Includes restricted cash.

 

10



 


Footnotes

 

(1)         We use EBITDA and adjusted EBITDA to measure the operating performance of our business.  We provide adjusted net income because we feel it provides meaningful insight for the investment community into the performance of our business.  We believe that net income (loss) attributable to Huntsman Corporation is the performance measure calculated and presented in accordance with generally accepted accounting principles in the U.S. (“GAAP”) that is most directly comparable to EBITDA, adjusted EBITDA and adjusted net income.  Additional information with respect to our use of each of these financial measures follows:

 

EBITDA is defined as net income (loss) attributable to Huntsman Corporation before interest, income taxes, and depreciation and amortization. EBITDA as used herein is not necessarily comparable to other similarly titled measures of other companies. The reconciliation of EBITDA to net income (loss) attributable to Huntsman Corporation is set forth in Table 5 above.

 

Adjusted EBITDA is computed by eliminating the following from EBITDA:  acquisition expenses and integration costs; loss (gain) on initial consolidation of subsidiaries; EBITDA from discontinued operations; loss (gain) on disposition of businesses/assets; loss on early extinguishment of debt; extraordinary loss (gain) on the acquisition of a business; certain legal settlements and related expenses; amortization of pension and postretirement actuarial losses (gains); and restructuring, impairment, plant closing and transition costs (credits).  The reconciliation of adjusted EBITDA to EBITDA is set forth in Table 4 above.

 

Adjusted net income (loss) is computed by eliminating the after tax impact of the following items from net income (loss) attributable to Huntsman Corporation: acquisition expenses and integration costs; impact of certain foreign tax credit elections; loss (gain) on initial consolidation of subsidiaries; loss (income) from discontinued operations; discount amortization on settlement financing associated with the terminated merger; loss (gain) on disposition of businesses/assets; loss on early extinguishment of debt; extraordinary loss (gain) on the acquisition of a business; certain legal settlements and related expenses; amortization of pension and postretirement actuarial losses (gains); and restructuring, impairment, plant closing and transition costs (credits).   We do not adjust for changes in tax valuation allowances because we do not believe it provides more meaningful information than is provided under GAAP.  The reconciliation of adjusted net income (loss) to net income (loss) attributable to Huntsman Corporation common stockholders is set forth in Table 4 above.

 

(2)         During the first quarter 2010 we closed our Australian styrenics operations; results from this business are treated as discontinued operations.

 

About Huntsman:

 

Huntsman Corporation is a publicly traded global manufacturer and marketer of differentiated chemicals with 2013 revenues of approximately $13 billion including the acquisition of Rockwood’s performance additives and TiO2 businesses. Our chemical products number in the thousands and are sold worldwide to manufacturers serving a broad and diverse range of consumer and industrial end markets.  We operate more than 100 manufacturing and R&D facilities in more than 30 countries and employ approximately 15,000 associates within our 5 distinct business divisions.  For more information about Huntsman, please visit the company’s website at www.huntsman.com.

 

Forward-Looking Statements:

 

Statements in this release that are not historical are forward-looking statements. These statements are based on management’s current beliefs and expectations. The forward-looking statements in this release are subject to uncertainty and changes in circumstances and involve risks and uncertainties that may affect the company’s operations, markets, products, services, prices and other factors as discussed in the Huntsman companies’ filings with the U.S. Securities and Exchange Commission. Significant risks and uncertainties may relate to, but are not limited to, financial, economic, competitive, environmental, political, legal, regulatory and technological factors.  The company assumes no obligation to provide revisions to any forward-looking statements should circumstances change, except as otherwise required by applicable laws.

 

11