Group 1 - Huntsman shares are yielding above 9% based on its quarterly dividend, with the stock trading as low as $10.98 [1] - Historically, dividends have contributed significantly to the total return of the stock market, exemplified by the iShares Russell 3000 ETF, which saw a 0.6% decrease in share price over twelve years but provided $10.77 per share in dividends, resulting in a total return of 13.15% [1] - Collecting a yield above 9% is considered attractive if sustainable, especially when compared to the average annual total return of about 1.0% from reinvested dividends [1] Group 2 - Dividend amounts are unpredictable and typically fluctuate with company profitability, making historical performance important for assessing future dividend sustainability [2]

Group 1 - Huntsman Corporation has completed a strategic review of its European Maleic Anhydride business, leading to the decision to permanently close its facility in Moers, Germany, by the end of the current quarter [1][2] - The closure is a response to underperformance, with the European Maleic Anhydride operations recording an adjusted EBITDA loss of approximately $10 million in 2024 [2] - Huntsman plans to serve European customers through its North American facilities located in Pensacola, FL, and Geismar, LA [2] Group 2 - The company expects to incur a one-time, non-cash asset impairment charge of around $75 million in the second quarter of 2025 due to the facility closure [2] - Huntsman shares have lost 54% in the past year, significantly underperforming compared to the Zacks Chemicals Diversified industry's 27.8% decline [3] - Order patterns in key markets such as construction and transportation are negatively impacted by low visibility and customer uncertainty regarding demand trends [4] Group 3 - Huntsman is focused on cost actions, including workforce reductions and asset optimization in both Europe and North America, in response to the current market conditions [4] - The company currently carries a Zacks Rank 5 (Strong Sell) [5] - Better-ranked stocks in the basic materials space include Carpenter Technology Corporation, Alamos Gold Inc., and Hawkins, Inc., with Carpenter Technology showing significant performance improvement [5][6][8]

Core Viewpoint - Huntsman Corporation has completed a strategic review of its European Maleic Anhydride business, leading to the closure of its facility in Moers, Germany, by the end of the current quarter [1]. Group 1: Business Operations - The closure of the Moers facility is expected to result in a one-time non-cash asset impairment charge of approximately $75 million during the second quarter of 2025 [1]. - In 2024, the European Maleic Anhydride business reported an adjusted EBITDA loss of around $10 million [1]. - Post-closure, Huntsman plans to serve European customers from its North American facilities located in Pensacola, Florida, and Geismar, Louisiana [1]. Group 2: Company Overview - Huntsman Corporation is a global manufacturer and marketer of differentiated and specialty chemicals, with revenues of approximately $6 billion in 2024 [2]. - The company operates over 60 manufacturing, R&D, and operations facilities across approximately 25 countries, employing around 6,300 associates [2].

Core Viewpoint - Huntsman Corporation reported a narrower loss in Q1 2025 compared to the previous year, but revenues fell short of expectations, indicating ongoing challenges in demand and pricing across its segments [1][5][6]. Financial Performance - The reported loss was 3 cents per share, an improvement from a loss of 22 cents per share in the same quarter last year [1]. - Adjusted loss per share was 11 cents, compared to a loss of 6 cents in the prior year, aligning with Zacks Consensus Estimate [1]. - Revenues totaled $1,410 million, down approximately 4% year over year, missing the Zacks Consensus Estimate of $1,479.2 million [1]. Segment Highlights - **Polyurethanes**: Revenues decreased by 2% to $912 million, missing estimates due to lower average selling prices, although sales volumes improved [2]. - **Performance Products**: Revenues fell 12% to $257 million, below estimates, primarily due to reduced sales volumes from lower customer demand and production outages [3]. - **Advanced Materials**: Revenues decreased by 5% to $249 million, falling short of estimates, driven by lower average selling prices and negative foreign currency impacts [4]. Cash Flow and Expenditures - Free cash flow from continuing operations was a use of $107 million, slightly higher than the $105 million used in the prior-year quarter [5]. - Capital expenditures were $36 million, down from $42 million in the previous year [5]. - As of March 31, 2025, the company had approximately $1.3 billion in combined cash and unused borrowing capacity [5]. Outlook - The company anticipates continued pressure on order patterns in key markets due to low visibility and customer uncertainty regarding demand trends [6]. - Huntsman is focusing on cost actions, including workforce reductions and asset optimization in Europe and North America [6]. - Capital expenditures for 2025 are expected to be between $180 million and $190 million [7]. Stock Performance - Huntsman shares have declined by 53.1% over the past year, compared to a 25.5% decline in the Zacks Chemicals Diversified industry [8]. Zacks Rank - Huntsman currently holds a Zacks Rank of 5 (Strong Sell), indicating a challenging outlook compared to better-ranked stocks in the Basic Materials sector [9].

Financial Performance - Revenues for Huntsman Corporation decreased by 4% to $1,410 million in Q1 2025 compared to $1,470 million in Q1 2024[141] - Gross profit remained stable at $201 million for both Q1 2025 and Q1 2024[141] - Adjusted EBITDA decreased by 11% to $72 million in Q1 2025 from $81 million in Q1 2024[141] - Net income for Huntsman Corporation was $11 million in Q1 2025, a significant improvement from a net loss of $23 million in Q1 2024[141] - Operating income improved to $42 million in Q1 2025 from a loss of $38 million in Q1 2024[141] - For the three months ended March 31, 2025, loss from continuing operations attributable to Huntsman Corporation improved by $26 million to a loss of $4 million compared to a loss of $30 million in the same period of 2024[154] - Adjusted EBITDA for total reportable segments decreased by $16 million, or 13%, to $108 million for the three months ended March 31, 2025 compared to $124 million in 2024[156] - Corporate and other adjusted EBITDA loss improved to $36 million for Huntsman Corporation from a loss of $43 million in the same period of 2024[162] Cash Flow and Capital Expenditures - Net cash used in operating activities from continuing operations increased by 13% to $(71) million in Q1 2025 compared to $(63) million in Q1 2024[141] - Capital expenditures from continuing operations decreased by 14% to $(36) million in Q1 2025 from $(42) million in Q1 2024[141] - Net cash provided by investing activities for Q1 2025 was $6 million, compared to a cash use of $(30) million in Q1 2024[165] - Free cash flow from continuing operations for Q1 2025 was a cash use of $107 million, slightly increasing from $105 million in Q1 2024[168] - The company expects to spend approximately $180 million to $190 million on capital expenditures in 2025, focusing on environmental upgrades and facility expansions[175] Tax and Interest - The effective tax rate for Huntsman Corporation was 56% in Q1 2025, consistent with the previous year[143] - Income tax expense for the three months ended March 31, 2025 was $15 million, compared to an income tax benefit of $20 million in the same period of 2024[154] - Interest expense remained unchanged at $(19) million for both Q1 2025 and Q1 2024[141] Discontinued Operations and Other Income - Loss from discontinued operations decreased by 86% to $(1) million in Q1 2025 from $(7) million in Q1 2024[141] - Equity in income of investment in unconsolidated affiliates decreased to $1 million from $19 million in the 2024 period, primarily due to a decrease in income at a joint venture in China[154] Working Capital and Debt - Working capital increased by $186 million, with total current assets rising to $2,286 million, an 8% increase from $2,125 million in Q1 2024[169] - The current portion of debt decreased by $41 million to $284 million, primarily due to the discharge of obligations under the 2025 Senior Notes[169] Inventory and Receivables - Accounts and notes receivable increased by $72 million, primarily due to higher revenues in March 2025 compared to December 2024[169] - Inventories rose by $113 million, attributed to higher inventory costs and volumes[169] Pension and Share Repurchase - The company plans to make additional contributions of approximately $27 million to pension and other postretirement benefit plans during 2025[175] - The company has approximately $547 million remaining under the existing share repurchase program, with repurchases potentially commencing or being suspended without prior notice[175]

Financial Data and Key Metrics Changes - The company did not provide specific financial data or key metrics for the first quarter of 2025, but indicated that there was significant volatility in order patterns and demand [8][29] - The management expressed concerns about the disconnect between orders and downstream demand, particularly in the automotive and aerospace sectors [8][23] Business Line Data and Key Metrics Changes - The MDI (Methylene Diphenyl Diisocyanate) market saw a significant drop in imports into the Americas, with a 60% decrease by the end of March 2025 compared to previous months [10] - The company noted that while MDI prices in China had stabilized and recovered by 10%, the overall market conditions remained uncertain [12][14] Market Data and Key Metrics Changes - The automotive industry experienced a low single-digit percentage drop in production, with some manufacturers slowing down production in Mexico [22] - The construction materials market also showed volatility, with a disconnect between the number of homes being built and sold [26] Company Strategy and Development Direction - The company is focused on capitalizing on short-term changes and volatility while aligning costs with long-term market realities [16] - Management emphasized the need for a clear and realistic industrial policy in Europe to encourage investment [15] Management's Comments on Operating Environment and Future Outlook - Management expressed uncertainty about the macroeconomic environment and the petrochemical industry, indicating that many companies might need to adjust their outlooks [7][8] - The management believes that the current supply and demand issues are largely driven by uncertainty and expects these conditions to resolve in the coming months [9] Other Important Information - The company announced the closure of its Boisbury facility in Canada for spray foam, consolidating operations in Arlington, Texas [35] - The management reiterated their commitment to maintaining the dividend, citing a strong balance sheet and confidence in future cash generation [58][59] Q&A Session Summary Question: Can you speak to the bullwhip effect and inventory levels? - Management acknowledged the bullwhip effect and noted that inventory levels are generally leaner than in previous years, with pronounced volume reductions in automotive and aerospace sectors [20][24] Question: What is the outlook for the spray foam business? - The spray foam business has seen a slowdown in both new home construction and remodeling, impacting demand [34] Question: How are pricing and margins in the MDI market? - Management indicated that while they are pushing for price increases, the lack of demand has made it challenging to implement these increases effectively [37][38] Question: What is the impact of planned turnarounds on EBITDA? - Management estimated a $15 million hit to EBITDA in the first half of the year due to planned turnarounds, with $5 million in Q1 and $10 million expected in Q2 [62] Question: How does the company view its debt levels? - Management expressed that while current margins are not satisfactory, they believe the balance sheet remains strong and that improvements in EBITDA will help reduce leverage [104]

Financial Data and Key Metrics Changes - The company did not provide specific yearly guidance but focused on quarterly guidance due to macroeconomic uncertainties and supply chain issues [4][5] - There was a significant drop in imports of MDI into the Americas, with a 60% decrease by the end of March compared to January [8][9] - The company expects to see improvements in cash conversion cycles and inventory management throughout the year [39][102] Business Line Data and Key Metrics Changes - The Performance Products and Advanced Materials divisions are not expected to be materially impacted by tariffs, although the overall market remains uncertain [11][12] - The automotive and aerospace sectors are experiencing low single-digit production drops, with significant volatility in order patterns [20][22] - The spray foam business has seen a slowdown in both new home construction and remodeling due to higher interest rates [32][33] Market Data and Key Metrics Changes - The North American MDI market is experiencing a shift due to tariffs, with domestic production expected to benefit from reduced imports [9][10] - European markets are struggling with unclear industrial policies, impacting investment and operational decisions [13][91] - The overall construction market in North America is seeing a decline, particularly in residential construction, which is attributed to changing buying patterns [103] Company Strategy and Development Direction - The company is focused on capitalizing on short-term market changes while aligning costs with long-term market realities [14] - There is an ongoing assessment of the asset footprint to explore opportunities for growth and shareholder value creation [13][30] - The company is committed to maintaining its dividend despite current economic challenges, emphasizing a strong balance sheet and cash generation capabilities [57][58] Management's Comments on Operating Environment and Future Outlook - Management expressed uncertainty about the macroeconomic environment and its impact on the petrochemical industry, indicating a potential recovery in the coming months [5][6] - There is a belief that the current supply and demand issues are largely temporary and will resolve as trade deals are finalized [7][10] - The company remains optimistic about future demand in sectors like aerospace and construction, despite current volatility [76][71] Other Important Information - The company is undergoing several planned turnarounds, which are expected to impact EBITDA in the short term [60][64] - There is a focus on managing working capital effectively, with expectations for improvements in cash flow management [39][102] Q&A Session Summary Question: Can you speak to the bullwhip effect and inventory levels? - Management acknowledged the bullwhip effect and noted that inventory levels are generally leaner than in previous years, with pronounced volume reductions in automotive and aerospace sectors [16][20] Question: How do you view growth potential in a protectionist environment? - Management believes that the majority of profits come from domestically produced products and does not foresee a need to change the asset footprint significantly [30][31] Question: What is the impact of recent disruptions on EBITDA? - Management indicated a $15 million hit to EBITDA in the first half, with specific impacts from planned turnarounds and unplanned outages [60][62] Question: How are MDI margins expected to change in Q2? - Management expects MDI margins to improve if pricing can be maintained or increased, despite current low demand [67][68] Question: What is the outlook for the dividend? - Management expressed confidence in maintaining the dividend, citing strong cash generation and a solid balance sheet [57][58] Question: How is the company managing its debt levels? - Management is focused on improving margins and believes the current debt levels are manageable, with a strong liquidity position [101][102]

Core Insights - Huntsman reported $1.41 billion in revenue for Q1 2025, a year-over-year decline of 4.1% and an EPS of -$0.11 compared to -$0.06 a year ago [1] - The revenue fell short of the Zacks Consensus Estimate of $1.48 billion, resulting in a surprise of -4.68% [1] - The company has not delivered an EPS surprise, with the consensus EPS estimate being -$0.11 [1] Performance Metrics - Huntsman's shares have returned -14.2% over the past month, while the Zacks S&P 500 composite changed by -0.7% [3] - The stock currently holds a Zacks Rank 5 (Strong Sell), indicating potential underperformance against the broader market [3] Segment Performance - Polyurethanes sales volume decreased by 3%, compared to an estimated 4.2% decline by analysts [4] - Local currency price for Polyurethanes fell by 3%, against an expected increase of 1.5% [4] - Total revenues for Polyurethanes were reported at $912 million, below the average estimate of $943.78 million, representing a year-over-year change of -1.5% [4] - Advanced Materials revenues were $249 million, compared to an estimated $264.13 million, reflecting a -4.6% change year-over-year [4] - Performance Products revenues were $257 million, below the average estimate of $282.54 million, indicating an -11.7% year-over-year change [4]

Core Viewpoint - Huntsman Corporation announces the retirement of Tony Hankins, Division President of Polyurethanes, effective at the end of 2025, with Steen Weien Hansen appointed as his successor starting June 1, 2025 [1][2]. Company Leadership Transition - Tony Hankins has had a long career at Huntsman and its predecessor, starting in 1980, and will continue to advise management until December 31, 2025 [2]. - Steen Weien Hansen has been with the company since its acquisition of the polyurethanes division in 1999 and has held various leadership roles, including Vice President of Asia Pacific operations [3]. Executive Comments - Peter R. Huntsman, President, CEO, and Chairman, praised Hankins for his distinguished service and influence on future managers, while also highlighting Hansen's strong leadership and strategic capabilities [4]. Company Overview - Huntsman Corporation is a global manufacturer of specialty chemicals with approximately $6 billion in revenues for 2024, operating over 60 facilities in about 25 countries and employing around 6,300 associates [5].

Core Viewpoint - Huntsman reported a quarterly loss of $0.11 per share, aligning with the Zacks Consensus Estimate, but this reflects a deterioration from a loss of $0.06 per share a year ago [1] - The company’s revenues for the quarter were $1.41 billion, missing the Zacks Consensus Estimate by 4.68% and down from $1.47 billion year-over-year [2] Financial Performance - Huntsman has surpassed consensus EPS estimates two times over the last four quarters, but has only topped consensus revenue estimates once [2] - The company experienced a significant surprise in the previous quarter, with an expected loss of $0.12 per share turning into an actual loss of $0.25, resulting in a surprise of -108.33% [1] Stock Performance - Huntsman shares have declined approximately 26.2% since the beginning of the year, contrasting with the S&P 500's decline of -5.3% [3] - The current Zacks Rank for Huntsman is 5 (Strong Sell), indicating expectations of underperformance in the near future [6] Earnings Outlook - The consensus EPS estimate for the upcoming quarter is $0.04 on revenues of $1.62 billion, while the estimate for the current fiscal year is -$0.05 on revenues of $6.21 billion [7] - The trend for earnings estimate revisions for Huntsman is currently unfavorable, which may impact future stock movements [6] Industry Context - The Chemical - Diversified industry, to which Huntsman belongs, is currently ranked in the bottom 16% of over 250 Zacks industries, suggesting a challenging environment [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, emphasizing the importance of monitoring these changes [5]