Huntsman Corporation Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

OPERATING SEGMENT INFORMATION (Tables)

OPERATING SEGMENT INFORMATION (Tables)

9 Months Ended

Sep. 30, 2019

Schedule of major products by reportable operating segment


Segment		Products
Polyurethanes		MDI, PO, polyols, PG, TPU, aniline and MTBE
Performance Products		Specialty amines, ethyleneamines, maleic anhydride 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

Sales between segments are generally recognized at external market prices and are eliminated in consolidation. Adjusted EBITDA is presented as a measure of the financial performance of our global business units and for reporting the results of our operating segments. The adjusted EBITDA of our reportable operating segments excludes items that principally apply to our Company as a whole. The revenues and adjusted EBITDA from continuing operations for each of our reportable operating segments are as follows (dollars in millions):


	Three months				Nine months
	ended				ended
	September 30,				September 30,
	2019		2018		2019		2018
Revenues:
Polyurethanes	$	993	$	1,126	$	2,931	$	3,268
Performance Products		281		329		880		991
Advanced Materials		256		279		803		850
Textile Effects		179		204		583		631
Corporate and eliminations		(22)		30		(57)		43
Total	$	1,687	$	1,968	$	5,140	$	5,783

Huntsman Corporation:
Segment adjusted EBITDA(1):
Polyurethanes	$	146	$	218	$	426	$	668
Performance Products		38		54		125		158
Advanced Materials		51		56		159		177
Textile Effects		16		25		66		80
Corporate and other(2)		(36)		(45)		(112)		(129)
Total		215		308		664		954
Reconciliation of adjusted EBITDA to net income:
Interest expense—continuing operations		(27)		(30)		(86)		(86)
Interest expense—discontinued operations		—		(10)		—		(30)
Income tax expense—continuing operations		(30)		(16)		(113)		(41)
Income tax (expense) benefit—discontinued operations		(25)		41		(44)		(95)
Depreciation and amortization—continuing operations		(65)		(62)		(201)		(187)
Depreciation and amortization—discontinued operations		(13)		(23)		(59)		(63)
Net income attributable to noncontrolling interests		11		3		31		288
Other adjustments:
Business acquisition and integration expenses		(3)		(2)		(4)		(10)
Merger costs		—		(1)		—		(2)
EBITDA from discontinued operations		106		(213)		229		525
Noncontrolling interest of discontinued operations		—		21		—		(222)
Fair value adjustments to Venator investment		(148)		—		(90)		—
Loss on early extinguishment of debt		—		—		(23)		(3)
Certain legal settlements and related expenses		(1)		(1)		(1)		(4)
Certain nonrecurring information technology project implementation costs		(1)		—		(1)		—
Amortization of pension and postretirement actuarial losses		(16)		(18)		(49)		(50)
Plant incident remediation costs		(5)		—		(5)		—
Restructuring, impairment and plant closing and transition credits (costs)		43		(5)		42		(9)
Net income (loss)	$	41	$	(8)	$	290	$	965


	Three months				Nine months
	ended				ended
	September 30,				September 30,
	2019		2018		2019		2018
Huntsman International:
Segment adjusted EBITDA(1):
Polyurethanes	$	146	$	218	$	426	$	668
Performance Products		38		54		125		158
Advanced Materials		51		56		159		177
Textile Effects		16		25		66		80
Corporate and other(2)		(35)		(45)		(108)		(126)
Total		216		308		668		957
Reconciliation of adjusted EBITDA to net income:
Interest expense—continuing operations		(31)		(36)		(99)		(102)
Interest expense—discontinued operations		—		(10)		—		(30)
Income tax expense—continuing operations		(29)		(15)		(110)		(38)
Income tax (expense) benefit—discontinued operations		(25)		41		(44)		(95)
Depreciation and amortization—continuing operations		(65)		(60)		(201)		(184)
Depreciation and amortization—discontinued operations		(13)		(23)		(59)		(63)
Net income attributable to noncontrolling interests		11		3		31		288
Other adjustments:
Business acquisition and integration expenses		(3)		(2)		(4)		(10)
Merger costs		—		(1)		—		(2)
EBITDA from discontinued operations		106		(213)		229		525
Noncontrolling interest of discontinued operations		—		21		—		(222)
Fair value adjustments to Venator investment		(148)		—		(90)		—
Loss on early extinguishment of debt		—		—		(23)		(3)
Certain legal settlements and related expenses		(1)		(1)		(1)		(4)
Certain nonrecurring information technology project implementation costs		(1)		—		(1)		—
Amortization of pension and postretirement actuarial losses		(17)		(18)		(52)		(52)
Plant incident remediation costs		(5)		—		(5)		—
Restructuring, impairment and plant closing and transition credits (costs)		43		(5)		42		(9)
Net income (loss)	$	38	$	(11)	$	281	$	956

(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 the chief operating decision maker 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) certain nonrecurring information technology project implementation costs; (i) gain (loss) on sale of assets; (j) amortization of pension and postretirement actuarial losses; (k) plant incident remediation costs; (l) U.S. Tax Reform Act impact on noncontrolling interest; and (m) 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, loss on early extinguishment of debt, unallocated restructuring, impairment and plant closing costs, nonoperating income and expense and gains and losses on the disposition of corporate assets.