| Segment Reporting Disclosure [Text Block] |
19. OPERATING SEGMENT INFORMATION
We derive our revenues, earnings and cash flows from the manufacture and sale of a wide variety of diversified organic chemical products. We have three operating segments, which are also our reportable segments: Polyurethanes, Performance Products and Advanced Materials. We have organized our business and derived our operating segments around differences in product lines.
The major products of each reportable operating segment are as follows:
| Segment |
|
Products |
| Polyurethanes |
|
MDI, polyols, TPU and other polyurethane-related products |
| Performance Products |
|
Specialty amines, ethyleneamines, maleic anhydride and technology licenses |
| Advanced Materials |
|
Technologically-advanced epoxy, phenoxy, acrylic, polyurethane and acrylonitrile-butadiene-based polymer formulations; high performance thermoset resins, curing agents, toughening agents, and carbon nanotubes additives |
Sales between segments are generally recognized at external market prices and are eliminated in consolidation. We use adjusted EBITDA to measure the financial performance of our global business units and for reporting the results of our operating segments. This measure includes all operating items relating to the businesses. The adjusted EBITDA of operating segments excludes items that principally apply to our Company as a whole. The following schedule includes revenues and adjusted EBITDA for each of our reportable operating segments (dollars in millions).
| |
|
Three months |
|
|
Six months |
|
| |
|
ended |
|
|
ended |
|
| |
|
June 30, |
|
|
June 30, |
|
| |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
| Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Polyurethanes |
|
$ |
1,012 |
|
|
$ |
1,353 |
|
|
$ |
2,003 |
|
|
$ |
2,739 |
|
| Performance Products |
|
|
307 |
|
|
|
492 |
|
|
|
641 |
|
|
|
972 |
|
| Advanced Materials |
|
|
284 |
|
|
|
336 |
|
|
|
573 |
|
|
|
671 |
|
| Total reportable segments’ revenues |
|
|
1,603 |
|
|
|
2,181 |
|
|
|
3,217 |
|
|
|
4,382 |
|
| Intersegment eliminations |
|
|
(7 |
) |
|
|
(11 |
) |
|
|
(15 |
) |
|
|
(20 |
) |
| Total |
|
$ |
1,596 |
|
|
$ |
2,170 |
|
|
$ |
3,202 |
|
|
$ |
4,362 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Huntsman Corporation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Segment adjusted EBITDA(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Polyurethanes |
|
$ |
88 |
|
|
$ |
229 |
|
|
$ |
154 |
|
|
$ |
453 |
|
| Performance Products |
|
|
55 |
|
|
|
152 |
|
|
|
126 |
|
|
|
298 |
|
| Advanced Materials |
|
|
51 |
|
|
|
67 |
|
|
|
99 |
|
|
|
134 |
|
| Total reportable segments’ adjusted EBITDA |
|
|
194 |
|
|
|
448 |
|
|
|
379 |
|
|
|
885 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Reconciliation of total reportable segments’ adjusted EBITDA to income from continuing operations before income taxes: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest expense, net—continuing operations |
|
|
(15 |
) |
|
|
(16 |
) |
|
|
(33 |
) |
|
|
(30 |
) |
| Depreciation and amortization—continuing operations |
|
|
(70 |
) |
|
|
(68 |
) |
|
|
(139 |
) |
|
|
(135 |
) |
| Corporate and other costs, net(2) |
|
|
(38 |
) |
|
|
(38 |
) |
|
|
(87 |
) |
|
|
(88 |
) |
| Net income attributable to noncontrolling interests |
|
|
12 |
|
|
|
14 |
|
|
|
25 |
|
|
|
31 |
|
| Other adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Business acquisition and integration expenses and purchase accounting inventory adjustments |
|
|
(2 |
) |
|
|
(4 |
) |
|
|
(3 |
) |
|
|
(10 |
) |
| Fair value adjustments to Venator investment, net |
|
|
(4 |
) |
|
|
— |
|
|
|
(5 |
) |
|
|
(2 |
) |
| Certain legal and other settlements and related expenses |
|
|
(1 |
) |
|
|
(2 |
) |
|
|
(2 |
) |
|
|
(14 |
) |
| Costs associated with the Albemarle Settlement, net |
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
|
|
(2 |
) |
| Gain (loss) on sale of business/assets |
|
|
1 |
|
|
|
(7 |
) |
|
|
1 |
|
|
|
(11 |
) |
| Income from transition services arrangements |
|
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
2 |
|
| Certain nonrecurring information technology project implementation costs |
|
|
(1 |
) |
|
|
(1 |
) |
|
|
(3 |
) |
|
|
(3 |
) |
| Amortization of pension and postretirement actuarial losses |
|
|
(7 |
) |
|
|
(10 |
) |
|
|
(15 |
) |
|
|
(22 |
) |
| Plant incident remediation credits |
|
|
— |
|
|
|
5 |
|
|
|
— |
|
|
|
5 |
|
| Restructuring, impairment and plant closing and transition costs(3) |
|
|
(8 |
) |
|
|
(27 |
) |
|
|
(2 |
) |
|
|
(30 |
) |
| Income from continuing operations before income taxes |
|
|
61 |
|
|
|
294 |
|
|
|
116 |
|
|
|
576 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income tax expense—continuing operations |
|
|
(28 |
) |
|
|
(65 |
) |
|
|
(39 |
) |
|
|
(125 |
) |
| (Loss) income from discontinued operations, net of tax |
|
|
(2 |
) |
|
|
13 |
|
|
|
120 |
|
|
|
31 |
|
| Net income |
|
$ |
31 |
|
|
$ |
242 |
|
|
$ |
197 |
|
|
$ |
482 |
|
| |
|
Three months |
|
|
Six months |
|
| |
|
ended |
|
|
ended |
|
| |
|
June 30, |
|
|
June 30, |
|
| |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
| Huntsman International: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Segment adjusted EBITDA(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Polyurethanes |
|
$ |
88 |
|
|
$ |
229 |
|
|
$ |
154 |
|
|
$ |
453 |
|
| Performance Products |
|
|
55 |
|
|
|
152 |
|
|
|
126 |
|
|
|
298 |
|
| Advanced Materials |
|
|
51 |
|
|
|
67 |
|
|
|
99 |
|
|
|
134 |
|
| Total reportable segments’ adjusted EBITDA |
|
|
194 |
|
|
|
448 |
|
|
|
379 |
|
|
|
885 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Reconciliation of total reportable segments’ adjusted EBITDA to income from continuing operations before income taxes: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest expense, net—continuing operations |
|
|
(15 |
) |
|
|
(16 |
) |
|
|
(33 |
) |
|
|
(30 |
) |
| Depreciation and amortization—continuing operations |
|
|
(70 |
) |
|
|
(68 |
) |
|
|
(139 |
) |
|
|
(135 |
) |
| Corporate and other costs, net(2) |
|
|
(38 |
) |
|
|
(36 |
) |
|
|
(85 |
) |
|
|
(83 |
) |
| Net income attributable to noncontrolling interests |
|
|
12 |
|
|
|
14 |
|
|
|
25 |
|
|
|
31 |
|
| Other adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Business acquisition and integration expenses and purchase accounting inventory adjustments |
|
|
(2 |
) |
|
|
(4 |
) |
|
|
(3 |
) |
|
|
(10 |
) |
| Fair value adjustments to Venator investment, net |
|
|
(4 |
) |
|
|
— |
|
|
|
(5 |
) |
|
|
(2 |
) |
| Certain legal and other settlements and related expenses |
|
|
(1 |
) |
|
|
(2 |
) |
|
|
(2 |
) |
|
|
(14 |
) |
| Costs associated with the Albemarle Settlement, net |
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
|
|
(2 |
) |
| Gain (loss) on sale of business/assets |
|
|
1 |
|
|
|
(7 |
) |
|
|
1 |
|
|
|
(11 |
) |
| Income from transition services arrangements |
|
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
2 |
|
| Certain nonrecurring information technology project implementation costs |
|
|
(1 |
) |
|
|
(1 |
) |
|
|
(3 |
) |
|
|
(3 |
) |
| Amortization of pension and postretirement actuarial losses |
|
|
(7 |
) |
|
|
(10 |
) |
|
|
(15 |
) |
|
|
(22 |
) |
| Plant incident remediation credits |
|
|
— |
|
|
|
5 |
|
|
|
— |
|
|
|
5 |
|
| Restructuring, impairment and plant closing and transition costs(3) |
|
|
(8 |
) |
|
|
(27 |
) |
|
|
(2 |
) |
|
|
(30 |
) |
| Income from continuing operations before income taxes |
|
|
61 |
|
|
|
296 |
|
|
|
118 |
|
|
|
581 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income tax expense—continuing operations |
|
|
(28 |
) |
|
|
(66 |
) |
|
|
(39 |
) |
|
|
(126 |
) |
| (Loss) income from discontinued operations, net of tax |
|
|
(2 |
) |
|
|
13 |
|
|
|
120 |
|
|
|
31 |
|
| Net income |
|
$ |
31 |
|
|
$ |
243 |
|
|
$ |
199 |
|
|
$ |
486 |
|
| (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 and purchase accounting inventory adjustments; (b) fair value adjustments to Venator investment, net; (c) certain legal and other settlements and related expenses; (d) costs associated with the Albemarle Settlement, net; (e) gain (loss) on sale of business/assets; (f) income from transition services arrangements; (g) certain nonrecurring information technology project implementation costs; (h) amortization of pension and postretirement actuarial losses; (i) plant incident remediation credits (j) restructuring, impairment, plant closing and transition costs; and (k) (loss) income from discontinued operations, net of tax. |
| (2) |
Corporate and other costs, net includes unallocated corporate overhead, unallocated foreign currency exchange gains and losses, LIFO inventory valuation reserve adjustments, nonoperating income and expense and gains and losses on the disposition of corporate assets. |
| (3) |
Includes costs associated with transition activities related primarily to our Corporate program to optimize our global approach to leverage shared services capabilities. |
|