Huntsman(US:HUN)2024-05-03 16:28PART I FINANCIAL INFORMATION This section presents the unaudited condensed consolidated financial statements and management's analysis for Q1 2024 Condensed Consolidated Financial Statements (Unaudited) This section presents the unaudited condensed consolidated financial statements for Huntsman Corporation and its subsidiary for Q1 2024 Huntsman Corporation and Subsidiaries Financial Statements Huntsman Corporation reported a net loss of $23 million in Q1 2024, with revenues of $1,470 million and diluted loss per share of $0.22 Huntsman Corporation - Consolidated Statement of Operations (Q1 2024 vs Q1 2023) | Metric | Q1 2024 (Millions) | Q1 2023 (Millions) | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $1,470 | $1,606 | -8.5% | | Gross Profit | $201 | $269 | -25.3% | | Operating (Loss) Income | $(38) | $61 | NM | | (Loss) Income from Continuing Operations | $(16) | $44 | NM | | Net (Loss) Income | $(23) | $166 | NM | | Net (Loss) Income Attributable to Huntsman | $(37) | $153 | NM | | Diluted (Loss) Income per Share | $(0.22) | $0.83 | NM | Huntsman Corporation - Consolidated Balance Sheet Highlights | Metric | March 31, 2024 (Millions) | Dec 31, 2023 (Millions) | | :--- | :--- | :--- | | Total Current Assets | $2,443 | $2,314 | | Total Assets | $7,572 | $7,248 | | Total Current Liabilities | $1,579 | $1,172 | | Total Liabilities | $4,178 | $3,770 | | Total Equity | $3,394 | $3,478 | Huntsman Corporation - Consolidated Cash Flow Summary (Q1 2024 vs Q1 2023) | Metric | Q1 2024 (Millions) | Q1 2023 (Millions) | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | $(65) | $(154) | | Net Cash (Used in) Provided by Investing Activities | $(30) | $489 | | Net Cash Provided by (Used in) Financing Activities | $108 | $(379) | | Increase (Decrease) in Cash | $12 | $(39) | Huntsman International LLC and Subsidiaries Financial Statements Huntsman International LLC reported a net loss of $21 million in Q1 2024, with total revenues of $1,470 million, mirroring consolidated performance Huntsman International LLC - Statement of Operations (Q1 2024 vs Q1 2023) | Metric | Q1 2024 (Millions) | Q1 2023 (Millions) | | :--- | :--- | :--- | | Total Revenues | $1,470 | $1,606 | | Gross Profit | $201 | $269 | | Operating (Loss) Income | $(36) | $63 | | Net (Loss) Income | $(21) | $168 | Huntsman International LLC - Balance Sheet Highlights | Metric | March 31, 2024 (Millions) | Dec 31, 2023 (Millions) | | :--- | :--- | :--- | | Total Assets | $7,577 | $7,253 | | Total Liabilities | $4,174 | $3,762 | | Total Equity | $3,403 | $3,491 | Notes to Unaudited Condensed Consolidated Financial Statements These notes detail significant Q1 2024 events, including the SLIC joint venture asset acquisition, Textile Effects sale, restructuring, and debt structure - On January 31, 2024, the company completed the separation and acquisition of assets from its SLIC joint venture, resulting in a preliminary net bargain purchase gain of approximately $52 million and a write-off of certain prepaid assets of approximately $71 million5152 - In Q1 2024, the purchase price for the sale of the Textile Effects Business was finalized at $597 million, with a net charge of approximately $8 million recorded for post-closing obligations54 - The company recorded net restructuring expenses of $11 million in Q1 2024, primarily related to a new program in the Advanced Materials segment and ongoing European cost realignment efforts626364 Total Debt Composition (as of March 31, 2024) | Debt Instrument | Amount Outstanding (Millions) | | :--- | :--- | | Revolving facility | $195 | | Senior notes | $1,463 | | A/R programs | $163 | | Note payable (SLIC) | $190 | | Other | $45 | | Total Debt | $2,056 | - The company amended its U.S. and EU A/R Programs in January 2024, extending their maturity dates to January 2027 and July 2027, respectively77 - The Board of Directors has authorized a $2 billion share repurchase program, of which approximately $547 million remained available as of March 31, 2024, with no shares repurchased in Q1 202497182 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q1 2024 financial results, noting an 8% revenue decrease and a 40% adjusted EBITDA drop, driven by lower selling prices Results of Operations Huntsman's Q1 2024 revenues decreased 8% to $1,470 million, with a 25% gross profit decline and a 40% adjusted EBITDA drop to $81 million Huntsman Corporation - Key Financial Results (Q1 2024 vs Q1 2023) | Metric | Q1 2024 (Millions) | Q1 2023 (Millions) | % Change | | :--- | :--- | :--- | :--- | | Revenues | $1,470 | $1,606 | (8)% | | Gross Profit | $201 | $269 | (25)% | | Operating (Loss) Income | $(38) | $61 | NM | | Adjusted EBITDA | $81 | $136 | (40)% | - The decrease in revenue was primarily due to lower average selling prices across all segments, partially offset by higher sales volumes in the Polyurethanes and Performance Products segments163 - Q1 2024 results include a $52 million gain on the acquisition of SLIC assets and a concurrent $71 million write-off of related prepaid assets163 Segment Analysis All three segments experienced revenue and adjusted EBITDA declines in Q1 2024, driven by lower selling prices and volumes Segment Revenues and Adjusted EBITDA (Q1 2024 vs Q1 2023) | Segment | Revenues Q1 2024 (Millions) | Revenues Q1 2023 (Millions) | Adj. EBITDA Q1 2024 (Millions) | Adj. EBITDA Q1 2023 (Millions) | | :--- | :--- | :--- | :--- | :--- | | Polyurethanes | $926 | $991 | $39 | $66 | | Performance Products | $291 | $334 | $42 | $71 | | Advanced Materials | $261 | $289 | $43 | $48 | - Polyurethanes: Revenue decreased 7% due to a 16% drop in average selling prices, partially offset by a 9% increase in sales volumes165167 - Performance Products: Revenue fell 13% as average selling prices declined 17%, despite a 4% rise in sales volumes165168 - Advanced Materials: Revenue declined 10% due to a 6% decrease in average selling prices and a 4% drop in sales volumes165169 Liquidity and Capital Resources As of March 31, 2024, Huntsman reported total liquidity of $1,607 million, with improved operating cash flow and planned 2024 capital expenditures of $200 million - Total liquidity as of March 31, 2024, was $1,607 million, comprising $552 million in cash, $995 million available under the revolving credit facility, and $60 million under A/R Programs180 - Net cash used in operating activities from continuing operations was $63 million, an improvement from $122 million in the prior-year period, primarily due to favorable changes in operating assets and liabilities173 - The company plans to spend approximately $200 million on capital expenditures in 2024182 - The company expects to pay the remainder of the note payable related to the SLIC asset acquisition by the end of 2024 using available funds at its HPS joint venture182 Quantitative and Qualitative Disclosures About Market Risk The company faces market risks from interest rates, foreign exchange rates, and commodity prices, which it manages using derivative instruments and hedging strategies - Huntsman is exposed to market risks from interest rates, foreign exchange rates, and commodity prices188 - The company uses derivative instruments from time to time to manage these exposures and hedges its net investment in some European operations188 Controls and Procedures Management concluded that disclosure controls and procedures were effective as of March 31, 2024, with no material changes to internal control over financial reporting - Based on an evaluation as of March 31, 2024, the CEO and CFO concluded that the company's disclosure controls and procedures were effective189 - There were no changes to internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, these controls190 PART II OTHER INFORMATION This section covers other information including legal proceedings, risk factors, equity security sales, and exhibits for the reporting period Legal Proceedings No material developments in legal proceedings have occurred since the 2023 Annual Report on Form 10-K - No material developments have occurred in legal proceedings since the 2023 Annual Report on Form 10-K192 Risk Factors This section refers to the risk factors detailed in the 2023 Annual Report on Form 10-K, with no material changes noted - For information on risk factors, the report refers to the 'Part I. Item 1A. Risk Factors' section of the Annual Report on Form 10-K for the year ended December 31, 2023193 Unregistered Sales of Equity Securities and Use of Proceeds Huntsman did not repurchase shares in Q1 2024, with $547 million remaining available under the $2 billion share repurchase program - The company did not repurchase any shares of its common stock during the three months ended March 31, 2024196 - Approximately $547 million remains available for repurchase under the company's $2 billion share repurchase program authorization195 Exhibits This section lists exhibits filed with the Form 10-Q, including CEO/CFO certifications and XBRL data files - Lists exhibits filed with the report, including CEO/CFO certifications and XBRL documents199