Huntsman Corporation Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

OPERATING SEGMENT INFORMATION (Tables)

OPERATING SEGMENT INFORMATION (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of major products by reportable operating segment


Segment		Products
Polyurethanes		MDI, PO, polyols, PG, TPU, aniline and MTBE
Performance Products		Amines, surfactants, LAB, maleic anhydride, other performance chemicals, EG, olefins and technology licenses
Advanced Materials		Basic liquid and solid epoxy resins; specialty resin compounds; cross-linking, matting and curing agents; epoxy, acrylic and polyurethane-based formulations
Textile Effects		Textile chemicals, dyes and digital inks

Schedule of revenues and EBITDA for each of the entity's reportable operating segments and reconciliation of adjusted EBITDA to net income

The revenues and adjusted EBITDA for each of our reportable operating segments are as follows (dollars in millions):




	Year ended December 31,
	2018		2017		2016
Revenues:
Polyurethanes	$	5,094	$	4,399	$	3,667
Performance Products		2,355		2,109		2,126
Advanced Materials		1,116		1,040		1,020
Textile Effects		824		776		751
Corporate and eliminations		(10)		34		(46)
Total	$	9,379	$	8,358	$	7,518

Huntsman Corporation:
Segment adjusted EBITDA(1):
Polyurethanes	$	946	$	850	$	569
Performance Products		367		296		316
Advanced Materials		225		219		223
Textile Effects		101		83		73
Corporate and other(2)		(170)		(189)		(184)
Total		1,469		1,259		997
Reconciliation of adjusted EBITDA to net income:
Interest expense—continuing operations		(115)		(165)		(203)
Interest (expense) income—discontinued operations		(36)		(19)		1
Income tax expense—continuing operations		(97)		(64)		(109)
Income tax (expense) benefit—discontinued operations		(34)		(67)		24
Depreciation and amortization—continuing operations		(343)		(319)		(318)
Depreciation and amortization—discontinued operations		—		(68)		(114)
Net income attributable to noncontrolling interests		313		105		31
Other adjustments:
Business acquisition and integration expenses		(5)		(19)		(12)
Purchase accounting inventory adjustments		(4)		—		—
Merger costs		(2)		(28)		—
EBITDA from discontinued operations		(125)		312		81
Noncontrolling interest of discontinued operations		(232)		(49)		(11)
Fair value adjustments to Venator investment		(62)		—		—
Loss on early extinguishment of debt		(3)		(54)		(3)
Certain legal settlements and related (expenses) income		(6)		11		(1)
Gain on sale of assets		—		9		97
Amortization of pension and postretirement actuarial losses		(71)		(73)		(55)
Plant incident remediation costs		(1)		(16)		—
U.S. Tax Reform Act impact on noncontrolling interest		—		6		—
Restructuring, impairment and plant closing and transition credits (costs)		4		(20)		(48)
Net income	$	650	$	741	$	357


	Year ended December 31,
	2018		2017		2016
Depreciation and Amortization:
Polyurethanes	$	129	$	116	$	114
Performance Products		145		137		132
Advanced Materials		37		33		35
Textile Effects		16		14		15
Corporate and other		16		19		22
Total	$	343	$	319	$	318


	Year ended December 31,
	2018		2017		2016
Capital Expenditures:
Polyurethanes	$	168	$	162	$	143
Performance Products		95		79		131
Advanced Materials		21		21		16
Textile Effects		21		16		19
Corporate and other		8		4		9
Total	$	313	$	282	$	318


	December 31,
		2018		2017		2016
Total Assets:
Polyurethanes	$	3,427	$	3,112	$	2,677
Performance Products		2,088		2,069		2,046
Advanced Materials		796		796		728
Textile Effects		571		564		523
Corporate and other		1,071		823		975
Total	$	7,953	$	7,364	$	6,949

(1)

We use segment adjusted EBITDA as the measure of each segment’s profit or loss. We believe that segment adjusted EBITDA more accurately reflects what management uses to make decisions about resources to be allocated to the segments and assess their financial performance. Segment adjusted EBITDA is defined as net income of Huntsman Corporation or Huntsman International, as appropriate, before interest, income tax, depreciation and amortization, net income attributable to noncontrolling interests and certain Corporate and other items, as well as eliminating the following adjustments: (a) business acquisition and integration expenses; (b) merger costs; (c) EBITDA from discontinued operations; (d) noncontrolling interest of discontinued operations; (e) fair value adjustments to Venator investment; (f) loss on early extinguishment of debt; (g) certain legal settlements and related income (expenses); (h) gain (loss) on sale of assets; (i) amortization of pension and postretirement actuarial losses; (j) plant incident remediation costs; (k) U.S. Tax Reform Act impact on noncontrolling interest; and (l) restructuring, impairment, plant closing and transition credits (costs).

(2)

Corporate and other includes unallocated corporate overhead, unallocated foreign exchange gains and losses, LIFO inventory valuation reserve adjustments, nonoperating income and expense, benzene sales and gains and losses on the disposition of corporate assets.

Schedule of revenues and long-lived assets by geographical area


	Year ended December 31,
		2018		2017		2016
Revenues by geographic area(1):
United States	$	3,160	$	2,729	$	2,514
China		1,281		1,147		908
Mexico		587		481		433
Germany		537		508		466
Other nations		3,814		3,493		3,197
Total	$	9,379	$	8,358	$	7,518


	December 31,
		2018		2017		2016
Long-lived assets(2):
Huntsman Corporation
United States	$	1,637	$	1,597	$	1,570
The Netherlands		331		343		294
China		247		268		235
Saudi Arabia		161		172		185
Germany		143		163		136
Switzerland		108		112		110
Singapore		96		100		110
Other nations		341		343		394
Total	$	3,064	$	3,098	$	3,034

Huntsman International
United States	$	1,637	$	1,594	$	1,548
The Netherlands		331		343		294
China		247		268		235
Saudi Arabia		161		172		185
Germany		143		163		136
Switzerland		108		112		110
Singapore		96		100		110
Other nations		341		343		394
Total	$	3,064	$	3,095	$	3,012

(1) Geographic information for revenues is based upon countries into which product is sold.

(2) Long‑lived assets consist of property, plant and equipment, net.

HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES

OPERATING SEGMENT INFORMATION

Schedule of revenues and EBITDA for each of the entity's reportable operating segments and reconciliation of adjusted EBITDA to net income


	Year ended December 31,
Huntsman International:	2018		2017		2016
Segment adjusted EBITDA(1):
Polyurethanes	$	946	$	850	$	569
Performance Products		367		296		316
Advanced Materials		225		219		223
Textile Effects		101		83		73
Corporate and other(2)		(166)		(185)		(180)
Total		1,473		1,263		1,001
Reconciliation of adjusted EBITDA to net income:
Interest expense—continuing operations		(136)		(181)		(215)
Interest (expense) income—discontinued operations		(36)		(19)		1
Income tax expense—continuing operations		(93)		(61)		(108)
Income tax (expense) benefit—discontinued operations		(34)		(67)		24
Depreciation and amortization—continuing operations		(340)		(311)		(306)
Depreciation and amortization—discontinued operations		—		(68)		(114)
Net income attributable to noncontrolling interests		313		105		31
Other adjustments:
Business acquisition and integration expenses		(5)		(19)		(12)
Purchase accounting inventory adjustments		(4)		—		—
Merger costs		(2)		(28)		—
EBITDA from discontinued operations		(125)		309		76
Noncontrolling interest of discontinued operations		(232)		(49)		(11)
Fair value adjustments to Venator investment		(62)		—		—
Loss on early extinguishment of debt		(3)		(54)		(3)
Certain legal settlements and related (expenses) income		(6)		11		(1)
Gain on sale of assets		—		9		97
Amortization of pension and postretirement actuarial losses		(75)		(76)		(58)
Plant incident remediation costs		(1)		(16)		—
U.S. Tax Reform Act impact on noncontrolling interest		—		6		—
Restructuring, impairment and plant closing and transition credits (costs)		4		(20)		(48)
Net income	$	636	$	734	$	354


	December 31,
		2018		2017		2016
Depreciation and Amortization:
Polyurethanes	$	129	$	116	$	114
Performance Products		145		137		132
Advanced Materials		37		33		35
Textile Effects		16		14		15
Corporate and other		13		11		10
Total	$	340	$	311	$	306


	December 31,
		2018		2017		2016
Capital Expenditures:
Polyurethanes	$	163	$	162	$	143
Performance Products		100		79		131
Advanced Materials		20		21		16
Textile Effects		20		16		19
Corporate and other		10		4		9
Total	$	313	$	282	$	318


	December 31,
		2018		2017		2016
Total Assets:
Polyurethanes	$	3,427	$	3,109	$	2,665
Performance Products		2,088		2,069		2,045
Advanced Materials		796		796		728
Textile Effects		571		564		523
Corporate and other		1,453		1,167		1,274
Total	$	8,335	$	7,705	$	7,235

(1) We use segment adjusted EBITDA as the measure of each segment’s profit or loss. We believe that segment adjusted EBITDA more accurately reflects what management uses to make decisions about resources to be allocated to the segments and assess their financial performance. Segment adjusted EBITDA is defined as net income of Huntsman Corporation or Huntsman International, as appropriate, before interest, income tax, depreciation and amortization, net income attributable to noncontrolling interests and certain Corporate and other items, as well as eliminating the following adjustments: (a) business acquisition and integration expenses; (b) merger costs; (c) EBITDA from discontinued operations; (d) noncontrolling interest of discontinued operations; (e) fair value adjustments to Venator investment; (f) loss on early extinguishment of debt; (g) certain legal settlements and related income (expenses); (h) gain (loss) on sale of assets; (i) amortization of pension and postretirement actuarial losses; (j) plant incident remediation costs; (k) U.S. Tax Reform Act impact on noncontrolling interest; and (l) restructuring, impairment, plant closing and transition credits (costs).

(2) Corporate and other includes unallocated corporate overhead, unallocated foreign exchange gains and losses, LIFO inventory valuation reserve adjustments, nonoperating income and expense, benzene sales and gains and losses on the disposition of corporate assets.