1. GENERAL

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Certain Definitions

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For convenience in this report, the terms “Company,” “Huntsman,” “our,” “us” or “we” may be used to refer to Huntsman Corporation and, unless the context otherwise requires, its subsidiaries and predecessors. In this report, “Huntsman International” refers to Huntsman International LLC (our wholly-owned subsidiary).

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In this report, we may use, without definition, the common names of competitors or other industry participants. We may also use the common names or abbreviations for certain chemicals or products.

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Interim Financial Statements

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Our unaudited interim condensed consolidated financial statements and Huntsman International’s unaudited interim condensed consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP” or “U.S. GAAP”) and in management’s opinion reflect all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of results of operations, comprehensive income, financial position and cash flows for the periods presented. Results for interim periods are not necessarily indicative of those to be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes to consolidated financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2021 for our Company and Huntsman International.

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Description of Businesses

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We are a global manufacturer of differentiated organic chemical products. We operate in three segments: Polyurethanes, Performance Products and Advanced Materials. Our products comprise a broad range of chemicals and formulations, which we market globally to a diversified group of consumer and industrial customers. Our products are used in a wide range of applications, including those in the adhesives, aerospace, automotive, construction products, durable and non-durable consumer products, electronics, insulation, medical, packaging, coatings and construction, power generation, refining and synthetic fiber industries. We are a leading global producer in many of our key product lines, including MDI, amines, maleic anhydride and epoxy-based polymer formulations.

On August 9, 2022, we entered into a definitive agreement to sell our textile chemicals and dyes business (“Textile Effects Business”) to Archroma, a portfolio company of SK Capital Partners (“Archroma”). Beginning in the third quarter of 2022, the results of our Textile Effects Business are reported as discontinued operations for all periods presented. For more information, see “Note 4. Discontinued Operations and Business Dispositions—Sale of Textile Effects Business.” An insignificant impact on earnings from businesses previously divested is also reported in discontinued operations.

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We operate our businesses through Huntsman International, our wholly-owned subsidiary. Huntsman International is a Delaware limited liability company and was formed in 1999.

Huntsman Corporation and Huntsman International Financial Statements

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Except where otherwise indicated, these notes relate to the condensed consolidated financial statements for both our Company and Huntsman International. The differences between our financial statements and Huntsman International’s financial statements relate primarily to different capital structures and purchase accounting recorded at our Company for the 2003 step-acquisition of Huntsman International Holdings LLC, the former parent company of Huntsman International that was merged into Huntsman International in 2005.

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​Principles of Consolidation

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Our condensed consolidated financial statements include the accounts of our wholly-owned and majority-owned subsidiaries and any variable interest entities for which we are the primary beneficiary. Intercompany accounts and transactions have been eliminated.

Reclassfications 

Certain amounts in the condensed consolidated financial statements for prior periods have been recast for all periods presented to conform with the current presentation. These reclassifications were to present the assets and liabilities of our Textile Effects Business as held for sale and its results of operations as discontinued operations. See “— Recent Developments” below as well as “Note 4. Discontinued Operations and Business Dispositions—Sale of Textile Effects Business.” 

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Recent Developments 

European Restructuring Program

In early November 2022, we announced our commitment and specific plans to further realign our cost structure beyond the current in-progress cost optimization programs with additional restructuring in Europe. The new program will include exiting and consolidating certain facilities, workforce relocation to lower cost locations and further personnel rationalization. In connection with this program, we expect to record restructuring expenses of approximately $50 million through 2023.

Sale of Textile Effects Business 

On August 9, 2022, we entered into a definitive agreement to sell our Textile Effects Business to Archroma for a total enterprise value of $718 million, which includes the assumption of approximately $125 million in net underfunded pension liabilities as of December 31, 2021. We anticipate the transaction will close no later than the first half of 2023. Beginning in the third quarter of 2022, the results of our Textile Effects Business are reported as discontinued operations for all periods presented. For more information, see “Note 4. Discontinued Operations and Business Dispositions—Sale of Textile Effects Business.”