HUNTSMAN CORPORATION THE WOODLANDS, Texas, Oct. 28, 2016 /PRNewswire/ --
Third Quarter 2016 Highlights
-- Net income was $64 million compared to $63 million in the prior year
period and $94 million in the prior quarter.
-- Adjusted EBITDA was $272 million compared to $311 million in the prior
year period and $325 million in the prior quarter.
-- Diluted income per share was $0.23 compared to $0.22 in the prior year
period and $0.36 in the prior quarter.
-- Adjusted diluted income per share was $0.38 compared to $0.47 in the
prior year period and $0.53 in the prior quarter.
-- Adjusted EBITDA and net income impact from weather related and other
production outages of approximately $25 million and $16 million or
approximately $0.07 per adjusted diluted share.
-- Net cash provided by operating activities was $405 million. Free cash
flow generation was $300 million; we made a $100 million early repayment
of debt in July 2016 and another $100 million early repayment of debt in
September 2016.
-- On August 3, 2016, we announced that Innospec Inc. committed to purchase
our European surfactants business at an enterprise value of $225
million. The business represents approximately $24 million of annual
adjusted EBITDA. Closing is expected to occur by the end of the fourth
quarter of 2016.
Form 10 Highlights
-- On October 28, 2016, our subsidiary, temporarily named Huntsman Spin
Corporation, filed an initial Form 10 registration statement with the
U.S. Securities and Exchange Commission for the previously announced
spin-off of our Pigments & Additives and Textile Effects businesses.
-- Subject to market conditions, we plan to separate these businesses from
Huntsman in the first half of 2017.
-- The shares of the spin-off corporation that will be distributed to
Huntsman shareholders in the spin-off are expected to be listed and
traded on the New York Stock Exchange.
-- The Form 10 filed today includes a business overview, market
information, company strengths and strategy, certain named executive
management and historical carve-out financial statements. Additional
information regarding the final company name, capitalization, additional
pro forma information and other matters will be provided in subsequent
amendments to the Form 10.
Three months ended Nine months ended
September 30, June 30, September 30,
------------- -------------
In millions,
except per
share
amounts 2016 2015 2016 2016 2015
------------ ---- ---- ---- ---- ----
Revenues $2,363 $2,638 $2,544 $7,262 $7,967
Net income $64 $63 $94 $220 $117
Adjusted net
income(1) $91 $115 $126 $305 $368
Diluted
income per
share $0.23 $0.22 $0.36 $0.83 $0.36
Adjusted
diluted
income per
share(1) $0.38 $0.47 $0.53 $1.28 $1.49
Adjusted
EBITDA(1) $272 $311 $325 $871 $981
See end of press release for
footnote explanations
Huntsman Corporation (NYSE: HUN) today reported third quarter 2016 results with revenues of $2,363 million, net income of $64 million and adjusted EBITDA of $272 million.
Peter R. Huntsman, our President and CEO, commented:
"We have been intensely focused on improving our free cash flow generation, our results this quarter are reflective of this drive for value notwithstanding weather related and other production outages that impacted our earnings. In 2016 we planned to generate more than $350 million of free cash flow, this quarter we generated $300 million of free cash flow and year-to-date we have generated $569 million. Subsequently, we made $200 million of early repayments on our debt within the third quarter. Much of the improvement has come from increased discipline related to capital expenditures and working capital management.
"Earlier today, our temporarily named Huntsman Spin Corporation, filed an initial Form 10 registration statement with the U.S. Securities and Exchange Commission for the spin-off of our Pigments & Additives and Textile Effects businesses. This filing represents an important step in the progression towards a separation. Subject to market conditions we plan to separate in the first half of 2017.
"As I consider our operational performance in the quarter there are some key trends that standout. Our MDI business is growing sales volume and improving margins. Within Performance Products, margins for our key businesses, amines and maleic anhydride have stabilized. Advanced Materials and Textile Effects continue to operate at a steady and modestly improving pace. TiO2 prices are improving and with additional increases expected in the future, the timing of our spin-off should be well positioned. Poor refining markets continue to compress our MTBE margins."
Segment Analysis for 3Q16 Compared to 3Q15
Polyurethanes
The decrease in revenues in our Polyurethanes division for the three months ended September 30, 2016 compared to the same period in 2015 was primarily due to lower average selling prices and lower MTBE sales volumes, partially offset by higher MDI sales volumes. MDI average selling prices decreased in response to lower raw material costs. MTBE average selling prices decreased primarily as a result of lower pricing for high octane gasoline. MDI sales volumes increased due to higher demand in the Americas and European regions. MTBE sales volumes decreased primarily due to the impact of weather related and other production outages. The decrease in adjusted EBITDA was primarily due to lower MTBE margins and the impact of weather related and other production outages estimated at approximately $15 million, partially offset by higher MDI margins and sales volumes.
Performance Products
The decrease in revenues in our Performance Products division for the three months ended September 30, 2016 compared to the same period in 2015 was due to lower average selling prices and lower sales volumes. Average selling prices decreased primarily in response to lower raw material costs and competitive market conditions. Sales volumes decreased primarily due to the impact of weather related and other production outages, softer demand in China and oilfield applications as well as competitive market conditions. The decrease in adjusted EBITDA was primarily due to the impact of weather related and other production outages estimated at approximately $10 million as well as lower margins in our amines, maleic anhydride and upstream intermediates businesses.
Advanced Materials
The decrease in revenues in our Advanced Materials division for the three months ended September 30, 2016 compared to the same period in 2015 was due to lower sales volumes and lower average selling prices. Sales volumes decreased primarily due to soft demand for low value business in our coatings and construction and wind markets, partially offset by global growth in our aerospace and electronics markets. Average selling prices decreased in our Asia Pacific region primarily as a result of competitive pressure in our electrical, electronics and wind markets, partially offset by higher average selling prices in our European and Americas regions. Adjusted EBITDA was essentially flat as lower sales volumes and lower margins were mostly offset by lower selling, general and administrative costs.
Textile Effects
The decrease in revenues in our Textile Effects division for the three months ended September 30, 2016 compared to the same period in 2015 was due to lower average selling prices partially offset by higher sales volumes. Average selling prices decreased primarily due to lower raw material costs and the foreign currency exchange impact of a stronger U.S. dollar against major international currencies. Sales volumes increased in key target countries, mainly in South Asia. The increase in adjusted EBITDA was primarily due to higher margins from lower raw material costs as well as lower selling, general and administrative costs.
Pigments and Additives
The decrease in revenues in our Pigments and Additives division for the three months ended September 30, 2016 compared to the same period in 2015 was due to lower average selling prices. Average selling prices decreased primarily as a result of competitive pressure, however they increased compared to the prior quarter. Sales volumes were unchanged as increased end use demand for our titanium dioxide products were offset by seasonally lower volumes for our additives products. The increase in adjusted EBITDA was primarily due to higher margins and lower fixed costs resulting from restructuring savings.
Corporate, LIFO and Other
Adjusted EBITDA from Corporate, LIFO and Other increased by $5 million to a loss of $45 million for the three months ended September 30, 2016 compared to a loss of $50 million for the same period in 2015. The increase in adjusted EBITDA was primarily the result of an increase in unallocated foreign currency exchange gains and an increase in income from benzene sales.
Liquidity, Capital Resources and Outstanding Debt
As of September 30, 2016, we had $1,247 million of combined cash and unused borrowing capacity compared to $1,023 million on December 31, 2015.
We made a $100 million early repayment of debt on July 22, 2016, followed by another $100 million early repayment of debt on September 30, 2016. Both of these early repayments were applied to our term loan B due 2019.
Total capital expenditures for the three months and nine months ended September 30, 2016 were $101 million and $290 million, respectively. During the nine months ended September 30, 2016 we have received capital reimbursements from business partners of $28 million. We expect to spend approximately $450 million on capital expenditures in 2016 and $400 million in 2017 before capital reimbursements from business partners which are expected to be approximately $30 million and $20 million, respectively.
We expect our depreciation and amortization to be approximately $435 million in 2016 and approximately $450 million in 2017.
Income Taxes
During the three months and nine months ended September 30, 2016, we recorded an income tax benefit of $1 million and income tax expense of $58 million, respectively. During the three months and nine months ended September 30, 2016, we paid cash for income taxes of $8 million and $29 million, respectively.
Our MTBE earnings are taxed at the U.S. statutory rate of 35% and variability in our MTBE earnings has a meaningful impact on our adjusted effective tax rate. The combination of significantly lower MTBE earnings, the impact of weather related and other production outages in the U.S., and higher earnings in countries with valuation allowances, resulted in an unusually low adjusted effective tax rate of 14% in the third quarter of 2016.
We expect our 2016 and 2017 adjusted effective tax rate to be approximately 25 - 30%, with variability primarily conditioned on earnings within the U.S. We expect our long term adjusted effective tax rate to be approximately 30%.
Earnings Conference Call Information
We will hold a conference call to discuss our third quarter 2016 financial results on Friday, October 28, 2016 at 10:00 a.m. ET.
Call-in numbers for the conference call:
U.S. participants (888) 680 - 0890
International participants (617) 213 - 4857
Passcode 928 629 27#
In order to facilitate the registration process, you may use the following link to pre-register for the conference call. Callers who pre-register will be given a unique PIN to gain immediate access to the call and bypass the live operator. You may pre-register at any time, including up to and after the call start time. To pre-register, please go to: https://www.theconferencingservice.com/prereg/key.process?key=P3L7W44M8
Webcast Information
The conference call will be available via webcast and can be accessed from the company's website at ir.huntsman.com.
Replay Information
The conference call will be available for replay beginning October 28, 2016 and ending November 4, 2016.
Call-in numbers for the replay:
U.S. participants (888) 286 - 8010
International participants (617) 801 - 6888
Replay code 23056817
Upcoming Conferences
During the fourth quarter a member of management is expected to present at the Citi Basic Materials Conference on November 29, 2016 and the Bank of America Merrill Lynch Leveraged Finance Conference on November 30, 2016. A webcast of the presentation, if applicable, along with accompanying materials will be available at ir.huntsman.com.
Table 1 -- Results of Operations
--------------------------------
Three months ended Nine months ended
September 30, September 30,
------------- -------------
In
millions,
except
per
share
amounts 2016 2015 2016 2015
---------- ---- ---- ---- ----
Revenues $2,363 $2,638 $7,262 $7,967
Cost
of
goods
sold 1,965 2,165 5,991 6,495
----- ----- ----- -----
Gross
profit 398 473 1,271 1,472
Operating
expenses 235 290 752 859
Restructuring,
impairment
and
plant
closing
costs 45 14 87 221
--- --- --- ---
Operating
income 118 169 432 392
Interest
expense (52) (49) (152) (158)
Equity
in
income
of
investment
in
unconsolidated
affiliates 1 - 4 5
Loss
on
early
extinguishment
of
debt (1) (8) (3) (31)
Other
loss (2) - - (2)
--- ---
Income
before
income
taxes 64 112 281 206
Income
tax
benefit
(expense) 1 (49) (58) (85)
--- ---
Income
from
continuing
operations 65 63 223 121
Loss
from
discontinued
operations,
net
of
tax(2) (1) - (3) (4)
Net
income 64 63 220 117
Net
income
attributable
to
noncontrolling
interests,
net
of
tax (9) (8) (22) (28)
Net
income
attributable
to
Huntsman
Corporation $55 $55 $198 $89
=== === ==== ===
Adjusted
EBITDA(1) $272 $311 $871 $981
Adjusted
net
income(1) $91 $115 $305 $368
Basic
income
per
share $0.23 $0.23 $0.84 $0.36
Diluted
income
per
share $0.23 $0.22 $0.83 $0.36
Adjusted
diluted
income
per
share(1) $0.38 $0.47 $1.28 $1.49
Common
share
information:
Basic
shares
outstanding 236 244 236 244
Diluted
shares 240 247 239 247
Diluted
shares
for
adjusted
diluted
income
per
share 240 247 239 247
See end of press release for
footnote explanations
Table 2 -- Results of Operations by Segment
-------------------------------------------
Three months ended Nine months ended
September 30, Better / September 30, Better /
------------- -------------
In millions 2016 2015 (Worse) 2016 2015 (Worse)
----------- ---- ---- ------ ---- ---- ------
Segment Revenues:
Polyurethanes $891 $1,017 (12)% $2,703 $2,902 (7)%
Performance Products 509 618 (18)% 1,611 1,949 (17)%
Advanced Materials 247 275 (10)% 774 847 (9)%
Textile Effects 184 196 (6)% 567 618 (8)%
Pigments & Additives 532 543 (2)% 1,648 1,707 (3)%
Corporate and eliminations - (11) n/m (41) (56) n/m
--- --- --- ---
Total $2,363 $2,638 (10)% $7,262 $7,967 (9)%
====== ====== ====== ======
Segment Adjusted EBITDA(1):
Polyurethanes $137 $168 (18)% $439 $432 2%
Performance Products 70 122 (43)% 248 384 (35)%
Advanced Materials 55 56 (2)% 173 172 1%
Textile Effects 17 10 70% 59 50 18%
Pigments & Additives 38 5 660% 84 61 38%
Corporate, LIFO and other (45) (50) 10% (132) (118) (12)%
----
Total $272 $311 (13)% $871 $981 (11)%
==== ==== ==== ====
n/m = not meaningful
See end of press release for footnote
explanations
Table 3 -- Factors Impacting Sales Revenue
------------------------------------------
Three months ended
September 30, 2016 vs. 2015
---------------------------
Average Selling Price(a)
-----------------------
Local Exchange Sales Mix Sales
Currency Rate & Other Volume(b) Total
-------- ---- ------- -------- -----
Polyurethanes (10)% (1)% 7% (8)% (12)%
Polyurethanes, adj (10)% (1)% 7% 2% (2)% (e)
Performance Products (7)% (1)% (1)% (9)% (18)%
Performance Products, adj (7)% (1)% (1)% (5)% (14)% (e)
Advanced Materials (2)% (1)% 5% (12)% (10)%
Textile Effects (8)% (2)% (1)% 5% (6)%
Pigments & Additives (3)% (1)% 2% 0% (2)%
Pigments & Additives, adj (3)% (1)% 2% (1)% (3)% (d)
Total Company (7)% (1)% 4% (6)% (10)%
Total Company, adj (7)% (1)% 4% 0% (4)% (d)(e)
Nine months ended
September 30, 2016 vs. 2015
---------------------------
Average Selling Price(a)
-----------------------
Local Exchange Sales Mix Sales
Currency Rate & Other Volume(b) Total
-------- ---- ------- -------- -----
Polyurethanes (15)% (1)% 0% 9% (7)%
Polyurethanes, adj (15)% (1)% 0% 6% (10)% (c)(e)
Performance Products (10)% (1)% (4)% (2)% (17)%
Performance Products, adj (10)% (1)% (4)% (1)% (16)% (e)
Advanced Materials (2)% (2)% 3% (8)% (9)%
Textile Effects (6)% (3)% 0% 1% (8)%
Pigments & Additives (7)% (1)% 2% 3% (3)%
Pigments & Additives, adj (7)% (1)% 2% 3% (3)% (d)
Total Company (11)% (1)% (1)% 4% (9)%
Total Company, adj (11)% (1)% (1)% 2% (11)% (c)(d)(e)
(a) Excludes sales from tolling
arrangements, by-products and raw
materials.
(b) Excludes sales from by-
products and raw materials.
(c) Excludes volume impact from the
planned maintenance at our PO/
MTBE facility that occurred in
1H15.
(d) Excludes volume impact from
nitrogen tank incident at our
Uerdingen, Germany facility in
3Q15.
(e) Excludes volume impact from
weather related and other
production outages in 3Q16.
Table 4 -- Reconciliation of U.S. GAAP to Non-GAAP Measures
-----------------------------------------------------------
Income Tax Diluted Income
EBITDA (Expense) Benefit Net Income Per Share
------ ----------------- ---------- ---------
Three months ended Three months ended Three months ended Three months ended
September 30, September 30, September 30, September 30,
------------- ------------- ------------- -------------
In millions, except per share amounts 2016 2015 2016 2015 2016 2015 2016 2015
------------------------------------- ---- ---- ---- ---- ---- ---- ---- ----
Net income $64 $63 $64 $63 $0.27 $0.26
Net income attributable to noncontrolling interests (9) (8) (9) (8) (0.04) (0.03)
Net income attributable to Huntsman Corporation 55 55 55 55 0.23 0.22
---- ----
Interest expense 52 49
Income tax (benefit) expense from continuing operations (1) 49 1 (49)
Income tax benefit from discontinued operations(2) - (1)
Depreciation and amortization 113 103
Acquisition and integration expenses, purchase accounting adjustments 8 10 (4) (2) 4 8 0.02 0.03
Loss from discontinued operations, net of tax(2) 1 1 N/A N/A 1 - - -
Gain on disposition of businesses/assets (22) - 2 - (20) - (0.08) -
Loss on early extinguishment of debt 1 8 - (3) 1 5 - 0.02
Certain legal settlements and related expenses - 1 - - - 1 - -
Plant incident remediation costs, net 4 3 - (1) 4 2 0.02 0.01
Amortization of pension and postretirement actuarial losses 16 19 (4) (4) 12 15 0.05 0.06
Restructuring, impairment, plant closing and transition costs 45 14 (11) 15 34 29 0.14 0.12
Adjusted(1) $272 $311 $(16) $(44) $91 $115 $0.38 $0.47
==== ==== ==== ==== === ==== ----- -----
Adjusted income tax expense(4) $16 $44
Net income attributable to noncontrolling interests, net of tax 9 8
Adjusted pre-tax income(1) $116 $167
==== ====
Adjusted effective tax rate 14% 26%
Income Tax Diluted Income
EBITDA (Expense) Benefit Net Income Per Share
------ ----------------- ---------- ---------
Three months ended Three months ended Three months ended Three months ended
June 30, June 30, June 30, June 30,
In millions, except per share amounts 2016 2016 2016 2016
------------------------------------- ---- ---- ---- ----
Net income $94 $94 $0.39
Net income attributable to noncontrolling interests (7) (7) (0.03)
Net income attributable to Huntsman Corporation 87 87 0.36
----
Interest expense 50
Income tax expense from continuing operations 32 (32)
Income tax benefit from discontinued operations(2) -
Depreciation and amortization 109
Acquisition and integration expenses, purchase accounting adjustments 4 - 4 0.02
Loss from discontinued operations, net of tax(2) 1 N/A 1 -
Loss on early extinguishment of debt 2 (1) 1 -
Certain legal settlements and related expenses - - - -
Plant incident remediation credits, net (7) 1 (6) (0.03)
Amortization of pension and postretirement actuarial losses 17 (3) 14 0.06
Restructuring, impairment, plant closing and transition costs 30 (5) 25 0.10
Adjusted(1) $325 $(40) $126 $0.53
==== ==== ==== -----
Adjusted income tax expense(4) $40
Net income attributable to noncontrolling interests, net of tax 7
Adjusted pre-tax income(1) $173
====
Adjusted effective tax rate 23%
Income Tax Diluted Income
EBITDA (Expense) Benefit Net Income Per Share
------ ----------------- ---------- ---------
Nine months ended Nine months ended Nine months ended Nine months ended
September 30, September 30, September 30, September 30,
------------- ------------- ------------- -------------
In millions, except per share amounts 2016 2015 2016 2015 2016 2015 2016 2015
------------------------------------- ---- ---- ---- ---- ---- ---- ---- ----
Net income $220 $117 $220 $117 $0.92 $0.47
Net income attributable to noncontrolling interests (22) (28) (22) (28) (0.09) (0.11)
Net income attributable to Huntsman Corporation 198 89 198 89 0.83 0.36
---- ----
Interest expense 152 158
Income tax expense from continuing operations 58 85 (58) (85)
Income tax (benefit) expense from discontinued operations(2) (1) 1
Depreciation and amortization 322 297
Acquisition and integration expenses, purchase accounting adjustments 21 31 (7) (7) 14 24 0.06 0.10
Loss from discontinued operations, net of tax(2) 4 3 N/A N/A 3 4 0.01 0.02
(Gain) loss on disposition of businesses/assets (22) 1 2 - (20) 1 (0.08) -
Loss on early extinguishment of debt 3 31 (1) (11) 2 20 0.01 0.08
Certain legal settlements and related expenses 1 3 - (1) 1 2 - 0.01
Plant incident remediation (credits) costs, net (2) 3 1 (1) (1) 2 - 0.01
Amortization of pension and postretirement actuarial losses 49 56 (10) (14) 39 42 0.16 0.17
Restructuring, impairment, plant closing and transition costs 88 223 (19) (39) 69 184 0.29 0.74
Adjusted(1) $871 $981 $(92) $(158) $305 $368 $1.28 $1.49
==== ==== ==== ===== ==== ==== ----- -----
Adjusted income tax expense(4) $92 $158
Net income attributable to noncontrolling interests, net of tax 22 28
Adjusted pre-tax income(1) $419 $554
==== ====
Adjusted effective tax rate 22% 29%
See end of press release for
footnote explanations
Table 5 -- Selected Balance Sheet Items
---------------------------------------
September 30, June 30, December 31,
In
millions 2016 2016 2015
--------- ---- ---- ----
Cash $450 $383 $269
Accounts
and
notes
receivable,
net 1,466 1,546 1,449
Inventories 1,444 1,522 1,692
Other
current
assets 392 340 424
Property,
plant
and
equipment,
net 4,298 4,377 4,446
Assets
held
for
sale 121 - -
Other
assets 1,536 1,559 1,540
Total
assets $9,707 $9,727 $9,820
====== ====== ======
Accounts
payable $1,026 $991 $1,061
Other
current
liabilities 655 602 686
Current
portion
of
debt 88 96 170
Long-
term
debt 4,468 4,653 4,625
Liabilities
held
for
sale 30 - -
Other
liabilities 1,669 1,677 1,649
Total
equity 1,771 1,708 1,629
Total
liabilities
and
equity $9,707 $9,727 $9,820
====== ====== ======
Table 6 -- Outstanding Debt
---------------------------
September 30, June 30, December 31,
In millions 2016 2016 2015
----------- ---- ---- ----
Debt:
Senior credit
facilities $2,234 $2,435 $2,454
Accounts
receivable
programs 218 216 215
Senior notes 1,873 1,862 1,850
Variable
interest
entities 134 142 151
Other debt 97 94 125
Total debt -
excluding
affiliates 4,556 4,749 4,795
----- ----- -----
Total cash 450 383 269
--- --- ---
Net debt-
excluding
affiliates $4,106 $4,366 $4,526
====== ====== ======
Table 7 -- Summarized Statement of Cash Flows
---------------------------------------------
Three months ended Nine months ended
September 30, September 30,
-------------
In
millions 2016 2016 2015
--------- ---- ---- ----
Total
cash
at
beginning
of
period(a) $383 $269 $870
Net
cash
provided
by
operating
activities 405 848 387
Net
cash
used
in
investing
activities (96) (270) (383)
Net
cash
used
in
financing
activities (244) (397) (418)
Effect
of
exchange
rate
changes
on
cash 1 1 (13)
Change
in
restricted
cash 1 (1) (6)
-
Total
cash
at end
of
period(a) $450 $450 $437
==== ==== ====
Supplemental
cash
flow
information:
Cash
paid
for
interest $(36) $(139) $(158)
Cash
paid
for
income
taxes (8) (29) (81)
Cash
paid
for
capital
expenditures (101) (290) (454)
Depreciation
and
amortization 113 322 297
Changes
in
primary
working
capital:
Accounts
and
notes
receivable $84 $(6) $(53)
Inventories 69 246 46
Accounts
payable 40 (16) (111)
Total
cash
provided
by
(used
in)
primary
working
capital $193 $224 $(118)
==== ==== =====
Three months ended Nine months ended
September 30, September 30,
-------------
2016 2016 2015
---- ---- ----
Free
cash
flow(3):
Net
cash
provided
by
operating
activities $405 $848 $387
Capital
expenditures (101) (290) (454)
All
other
investing
activities 5 20 71
Excluding
acquisition
and
disposition
activities(b) (9) (9) (5)
Total
free
cash
flow $300 $569 $(1)
==== ==== ===
Adjusted
EBITDA $272 $871 $981
Capital
expenditures (101) (290) (454)
Capital
reimbursements 1 28 11
Interest (36) (139) (158)
Income
taxes (8) (29) (81)
Primary
working
capital
change 193 224 (118)
Restructuring (29) (85) (82)
Pensions (18) (63) (87)
Maintenance
&
other 26 52 (13)
Total
free
cash
flow(3) $300 $569 $(1)
==== ==== ===
(a) Includes restricted cash.
(b) Represents "Acquisition of business, net
of cash acquired", "Cash received from
purchase price adjustment for business
acquired", and "Proceeds from sale of
business/assets".
Footnotes
---------
(1) We use adjusted EBITDA to measure the
operating performance of our business. We
provide adjusted net income because we feel
it provides meaningful insight for the
investment community into the performance of
our business. We believe that net income
(loss) is the performance measure calculated
and presented in accordance with generally
accepted accounting principles in the U.S.
("GAAP") that is most directly comparable to
adjusted EBITDA and adjusted net income.
Additional information with respect to our
use of each of these financial measures
follows:
Adjusted EBITDA, adjusted net income (loss)
and adjusted diluted income (loss) per share,
as used herein, are not necessarily
comparable to other similarly titled measures
of other companies.
Adjusted EBITDA is computed by eliminating the
following from net income (loss): (a) net
income attributable to noncontrolling
interest, net of tax; (b) interest; (c)
income taxes; (d) depreciation and
amortization; (e) acquisition and integration
expenses, purchase accounting adjustments;
(f) EBITDA from discontinued operations; (g)
loss (gain) on disposition of businesses/
assets; (h) loss on early extinguishment of
debt; (i) certain legal settlements and
related expenses; (j) plant incident
remediation costs (credits), net; (k)
amortization of pension and postretirement
actuarial losses (gains); and (l)
restructuring, impairment, plant closing and
transition costs (credits). The
reconciliation of adjusted EBITDA to net
income (loss) is set forth in Table 4 above.
Adjusted net income (loss) and adjusted
diluted income (loss) per share are computed
by eliminating the after tax impact of the
following items from net income (loss): (a)
net income attributable to noncontrolling
interest; (b) acquisition and integration
expenses, purchase accounting adjustments;
(c) impact of certain foreign tax credit
elections; (d) loss (income) from
discontinued operations; (e) discount
amortization on settlement financing
associated with the terminated merger; (f)
loss (gain) on disposition of businesses/
assets; (g) loss on early extinguishment of
debt; (h) certain legal settlements and
related expenses; (i) plant incident
remediation costs (credits), net; (j)
amortization of pension and postretirement
actuarial losses (gains); and (k)
restructuring, impairment, plant closing and
transition costs (credits). The income tax
impacts, if any, of each adjusting item
represent a ratable allocation of the total
difference between the unadjusted tax expense
and the total adjusted tax expense, computed
without consideration of any adjusting items
using a with and without approach. We do not
adjust for changes in tax valuation
allowances because we do not believe it
provides more meaningful information than is
provided under GAAP. The reconciliation of
adjusted net income (loss) to net income
(loss) is set forth in Table 4 above.
(2) During the first quarter 2010 we closed our
Australian styrenics operations; results from
associated business are treated as
discontinued operations.
(3) Management internally uses a free cash flow
measure: (a) to evaluate the Company's
liquidity, (b) to evaluate strategic
investments, (c) to plan stock buyback and
dividend levels and (d) to evaluate the
Company's ability to incur and service debt.
Free cash flow is not a defined term under
U.S. GAAP, and it should not be inferred that
the entire free cash flow amount is available
for discretionary expenditures. The Company
defines free cash flow as cash flow provided
by operating activities less cash flow used
in investing activities, excluding merger and
acquisition activities. Free cash flow is
typically derived directly from the Company's
condensed consolidated statement of cash
flows; however, it may be adjusted for items
that affect comparability between periods.
About Huntsman:
Huntsman Corporation is a publicly traded global manufacturer and marketer of differentiated chemicals with 2015 revenues of approximately $10 billion. Our chemical products number in the thousands and are sold worldwide to manufacturers serving a broad and diverse range of consumer and industrial end markets. We operate more than 100 manufacturing and R&D facilities in approximately 30 countries and employ approximately 15,000 associates within our 5 distinct business divisions. For more information about Huntsman, please visit the company's website at www.huntsman.com.
Social Media:
Twitter: twitter.com/Huntsman_Corp
Facebook: www.facebook.com/huntsmancorp
LinkedIn: www.linkedin.com/company/huntsman
Forward-Looking Statements:
Statements in this release that are not historical are forward-looking statements. These statements are based on management's current beliefs and expectations. The forward-looking statements in this release are subject to uncertainty and changes in circumstances and involve risks and uncertainties that may affect the company's operations, markets, products, services, prices and other factors as discussed in the Huntsman companies' filings with the U.S. Securities and Exchange Commission. Significant risks and uncertainties may relate to, but are not limited to, financial, economic, competitive, environmental, political, legal, regulatory and technological factors. The company assumes no obligation to provide revisions to any forward-looking statements should circumstances change, except as otherwise required by applicable laws.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/huntsman-announces-third-quarter-results-and-filing-of-initial-form-10-registration-statement-for-spin-off-300353090.html
SOURCE Huntsman Corporation
