0001307954 0001089748 false --12-31 Q3 2022 --12-31 Q3 2022 11 12 348 324 0.01 0.01 1,200,000,000 1,200,000,000 261,142,535 259,701,770 192,757,360 214,170,287 68,385,175 45,531,489 0.2125 0.2125 0.2125 0.1625 0.1875 0.1875 11 12 348 324 2,728 2,728 2,728 2,728 3 8 1.475 July 31, 2024 0.90 July 31, 2024 1.30 445 1 175 0 56 56 43 43 1 3 2 6 2 3 3 2 2 0 The applicable rate for our U.S. A/R Program is defined by the lender as USD LIBOR. The applicable rate for our EU A/R Program is either USD LIBOR, EURIBOR or SONIA (Sterling Overnight Interbank Average Rate). In anticipation of the transition away from USD LIBOR, the amendments we made in July 2021 to our A/R Programs incorporated replacement rates for the USD LIBOR. Corporate and other costs, net includes unallocated corporate overhead, unallocated foreign exchange gains and losses, LIFO inventory valuation reserve adjustments, loss on early extinguishment of debt, unallocated restructuring, impairment and plant closing costs, nonoperating income and expense and gains and losses on the disposition of corporate assets. Includes costs associated with transition activities related primarily to our Corporate program to optimize our global approach to leverage shared services capabilities. Pension and other postretirement benefits amounts in parentheses indicate credits on our condensed consolidated statements of operations. At September 30, 2022 and December 31, 2021, respectively, $22 and $1 of cash and cash equivalents, $4 and $12 of accounts and notes receivable (net), $60 and $64 of inventories, $161 each of property, plant and equipment (net), $29 and $23 of other noncurrent assets, $126 and $146 of accounts payable, $11 and $13 of accrued liabilities, $10 each of current portion of debt, $10 and $6 of current operating lease liabilities, $28 and $35 of long-term debt, $21 and $20 of noncurrent operating lease liabilities and $45 and $46 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See "Note 6. Variable Interest Entities." Amounts are net of tax of $56 million as of both September 30, 2022 and January 1, 2022, respectively. A total of 193,623 performance share unit awards are reflected in the vested shares in this table, which represents the target number of performance share unit awards for this grant and were included in the balance at December 31, 2021. During the nine months ended September 30, 2022, an additional 96,814 performance share unit awards with a grant date fair value of $29.68 were issued due to the target performance criteria being exceeded. Total assets and liabilities held for sale as of September 30, 2022 are classified as current because it is probable that the sale of our Textile Effects Business will close within a year. As of September 30, 2022, a total of 106,285 restricted stock units were vested but not yet issued, of which 7,066 vested during the nine months ended September 30, 2022. These shares have not been reflected as vested shares in this table because, in accordance with the restricted stock unit agreements, shares of common stock are not issued for vested restricted stock units until termination of employment. Amounts are net of tax of $139 million and $153 million as of September 30, 2021 and January 1, 2021, respectively. 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, certain Corporate and other items and income from discontinued operations, 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) loss on early extinguishment of debt; (d) certain legal and other settlements and related expenses; (e) costs associated with the Albemarle Settlement, net; (f) (loss) gain on sale of business/assets; (g) income from transition services arrangements related to the sale of our Chemical Intermediates Businesses to Indorama; (h) certain nonrecurring information technology project implementation costs; (i) amortization of pension and postretirement actuarial losses; (j) plant incident remediation credits (costs); and (k) restructuring, impairment, plant closing and transition costs. As of September 30, 2022, we had approximately $8 million (U.S. dollar equivalents) of letters of credit issued and outstanding under our U.S. A/R Program. On September 30, 2022, we had an additional $11 million (U.S. dollar equivalents) of letters of credit and bank guarantees issued and outstanding under our 2022 Revolving Credit Facility. Interest rates on borrowings under the 2022 Revolving Credit Facility vary based on the type of loan and Huntsman International’s debt ratings. The representative interest rate for U.S. dollar borrowings as of September 30, 2022 was 1.475% above term SOFR. Amounts are net of tax of $43 million as of both September 30, 2021 and January 1, 2021. Amounts are net of tax of $97 million and $105 million as of September 30, 2022 and January 1, 2022, respectively. Amounts are net of tax of $164 million and $178 million as of September 30, 2021 and January 1, 2021, respectively. During the nine months ended September 30, 2021, stock options were only granted during the first quarter. The amount of actual availability under our A/R Programs may be lower based on the level of eligible receivables sold, changes in the credit ratings of our customers, customer concentration levels and certain characteristics of the accounts receivable being transferred, as defined in the applicable agreements. See table below for details about these reclassifications. Amounts include approximately $4 million of actuarial losses related to discontinued operations for both of the three months ended September 30, 2022 and 2021. Amounts contain approximately $12 million and $13 million of actuarial losses related to discontinued operations for the nine months ended September 30, 2022 and 2021, respectively. Amounts are net of tax of $43 million as of September 30, 2022 and January 1, 2022, respectively. Geographic information for revenues is based upon countries into which product is sold. These accumulated other comprehensive loss components are included in the computation of net periodic pension costs. See “Note 12. 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Table of Contents



UNITED STATES 

SECURITIES AND EXCHANGE COMMISSION 

WASHINGTON, D.C. 20549

 

Form 10-Q

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                          to                         

Commission
File Number

    

Exact Name of Registrant as Specified in its Charter,
Principal Office Address and Telephone Number

    

State of
Incorporation
or Organization

    

I.R.S. Employer
Identification No.

001-32427

Huntsman Corporation
10003 Woodloch Forest Drive
The Woodlands, Texas 77380
(281) 719-6000

Delaware

42-1648585

333-85141

Huntsman International LLC
10003 Woodloch Forest Drive
The Woodlands, Texas 77380
(281) 719-6000

Delaware

87-0630358

 


Securities registered pursuant to Section 12(b) of the Act:

Registrant

 

Title of each class

 

Trading Symbol

Name of each exchange on which registered

Huntsman Corporation

 

Common Stock, par value $0.01 per share

 

HUN

New York Stock Exchange

Huntsman International LLC

 

NONE

 

NONE

NONE

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Huntsman Corporation

Yes ☒

No ☐

Huntsman International LLC

Yes ☒

No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Huntsman Corporation

Yes ☒

No ☐

Huntsman International LLC

Yes ☒

No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Huntsman Corporation

Large accelerated filer ☒

Accelerated filer ☐

Non-accelerated filer ☐

Smaller reporting company ☐

Emerging growth company ☐

Huntsman International LLC

Large accelerated filer ☐

Accelerated filer ☐

Non-accelerated filer ☒

Smaller reporting company ☐

Emerging Growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Huntsman Corporation

Huntsman International LLC

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Huntsman Corporation

Yes ☐

No ☒

Huntsman International LLC

Yes ☐

No ☒

On October 25, 2022, 192,099,455 shares of common stock of Huntsman Corporation were outstanding and 2,728 units of membership interests of Huntsman International LLC were outstanding. There is no trading market for Huntsman International LLC’s units of membership interests. All of Huntsman International LLC’s units of membership interests are held by Huntsman Corporation.


This Quarterly Report on Form 10-Q presents information for two registrants: Huntsman Corporation and Huntsman International LLC. Huntsman International LLC is a wholly-owned subsidiary of Huntsman Corporation and is the principal operating company of Huntsman Corporation. The information reflected in this Quarterly Report on Form 10-Q is equally applicable to both Huntsman Corporation and Huntsman International LLC, except where otherwise indicated. Huntsman International LLC meets the conditions set forth in General Instructions H(1)(a) and (b) of Form 10-Q and, to the extent applicable, is therefore filing this form with a reduced disclosure format.



 

 
 

HUNTSMAN CORPORATION AND SUBSIDIARIES

HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES

QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTERLY PERIOD

ENDED September 30, 2022

TABLE OF CONTENTS

Page

PART I

FINANCIAL INFORMATION

4

ITEM 1.

Condensed Consolidated Financial Statements (Unaudited)

4

Huntsman Corporation and Subsidiaries:

Unaudited Condensed Consolidated Balance Sheets

4

Unaudited Condensed Consolidated Statements of Operations

5

Unaudited Condensed Consolidated Statements of Comprehensive (Loss) Income

6

Unaudited Condensed Consolidated Statements of Equity

7

Unaudited Condensed Consolidated Statements of Cash Flows

9

Huntsman International LLC and Subsidiaries:

Unaudited Condensed Consolidated Balance Sheets

10

Unaudited Condensed Consolidated Statements of Operations

11

Unaudited Condensed Consolidated Statements of Comprehensive (Loss) Income

12

Unaudited Condensed Consolidated Statements of Equity

13

Unaudited Condensed Consolidated Statements of Cash Flows

14

Huntsman Corporation and Subsidiaries and Huntsman International LLC and Subsidiaries:

Notes to Unaudited Condensed Consolidated Financial Statements

15

ITEM 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

36

ITEM 3.

Quantitative and Qualitative Disclosures About Market Risk

54

ITEM 4.

Controls and Procedures

54

PART II

OTHER INFORMATION

55

ITEM 1.

Legal Proceedings

55

ITEM 1A.

Risk Factors

55

ITEM 2.

Unregistered Sales of Equity Securities and Use of Proceeds

55

ITEM 6.

Exhibits

56

 

FORWARD-LOOKING STATEMENTS

Certain information set forth in this report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding: projections of revenue, expenses, profit, profit margins, tax rates, tax provisions, cash flows, pension and benefit obligations and funding requirements, our liquidity position or other projected financial measures; projected impact of COVID-19 on our operations and future financial results; projected impact of the potential expansion of the Russia-Ukraine conflict on our operations and future financial results; management’s plans and strategies for future operations, including statements relating to anticipated operating performance, cost reductions, restructuring activities, new product and service developments, competitive strengths or market position, acquisitions, divestitures, business separations, spin-offs, or other distributions, strategic opportunities, securities offerings, stock repurchases, dividends and executive compensation; growth, declines and other trends in markets we sell into; new or modified laws, regulations and accounting pronouncements; outstanding claims, legal proceedings, tax audits and assessments and other contingent liabilities; foreign currency exchange rates and fluctuations in those rates; general economic and capital markets conditions; the timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that we intend or believe will or may occur in the future. In some cases, forward-looking statements can be identified by terminology such as “believes,” “expects,” “may,” “will,” “should,” “anticipates” or “intends” or the negative of such terms or other comparable terminology, or by discussions of strategy. We may also make additional forward-looking statements from time to time. All such subsequent forward-looking statements, whether written or oral, by us or on our behalf, are also expressly qualified by these cautionary statements.

All forward-looking statements, including without limitation any projections derived from management’s examination of historical operating trends, are based upon our current expectations and various assumptions. Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for them, but there can be no assurance that management’s expectations, beliefs and projections will be achieved. All forward-looking statements apply only as of the date made. We undertake no obligation to publicly update or revise forward-looking statements whether because of new information, future events or otherwise, except as required by securities and other applicable law.

There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements contained in or contemplated by this report. Any forward-looking statements should be considered in light of the risks set forth in “Part II. Item 1A. Risk Factors” below and “Part I. Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021.

 

 

 

PART I. FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

HUNTSMAN CORPORATION AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In Millions, Except Share and Per Share Amounts)

  

September 30,

  

December 31,

 
  

2022

  

2021

 

ASSETS

        

Current assets:

        

Cash and cash equivalents(a)

 $515  $1,041 

Accounts and notes receivable (net of allowance for doubtful accounts of $11 and $12, respectively), ($348 and $324 pledged as collateral, respectively)(a)

  981   988 

Accounts receivable from affiliates

  23   27 

Inventories(a)

  1,079   1,038 

Receivable associated with the Albemarle Settlement

     333 

Other current assets

  115   155 

Current assets held for sale

  483   346 

Total current assets

  3,196   3,928 

Property, plant and equipment, net(a)

  2,288   2,443 

Investment in unconsolidated affiliates

  430   470 

Intangible assets, net

  433   469 

Goodwill

  636   650 

Deferred income taxes

  167   180 

Operating lease right-of-use assets

  359   381 

Other noncurrent assets(a)

  623   689 

Noncurrent assets held for sale

     182 

Total assets

 $8,132  $9,392 
         

LIABILITIES AND EQUITY

        

Current liabilities:

        

Accounts payable(a)

 $865  $1,054 

Accounts payable to affiliates

  33   60 

Accrued liabilities(a)

  393   713 

Current portion of debt(a)

  12   12 

Current operating lease liabilities(a)

  50   49 

Current liabilities held for sale

  242   163 

Total current liabilities

  1,595   2,051 

Long-term debt(a)

  1,476   1,538 

Deferred income taxes

  249   161 

Noncurrent operating lease liabilities(a)

  326   346 

Other noncurrent liabilities(a)

  502   586 

Noncurrent liabilities held for sale

     151 

Total liabilities

  4,148   4,833 

Commitments and contingencies (Notes 15 and 16)

          

Equity

        

Huntsman Corporation stockholders’ equity:

        

Common stock $0.01 par value, 1,200,000,000 shares authorized, 261,142,535 and 259,701,770 shares issued and 192,757,360 and 214,170,287 shares outstanding, respectively

  3   3 

Additional paid-in capital

  4,155   4,102 

Treasury stock, 68,385,175 and 45,531,489 shares, respectively

  (1,686)  (934)

Unearned stock-based compensation

  (37)  (25)

Retained earnings

  2,836   2,435 

Accumulated other comprehensive loss

  (1,497)  (1,203)

Total Huntsman Corporation stockholders’ equity

  3,774   4,378 

Noncontrolling interests in subsidiaries

  210   181 

Total equity

  3,984   4,559 

Total liabilities and equity

 $8,132  $9,392 

 


(a)

At September 30, 2022 and December 31, 2021, respectively, $22 and $1 of cash and cash equivalents, $4 and $12 of accounts and notes receivable (net), $60 and $64 of inventories, $161 each of property, plant and equipment (net), $29 and $23 of other noncurrent assets, $126 and $146 of accounts payable, $11 and $13 of accrued liabilities, $10 each of current portion of debt, $10 and $6 of current operating lease liabilities, $28 and $35 of long-term debt, $21 and $20 of noncurrent operating lease liabilities and $45 and $46 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See “Note 6. Variable Interest Entities.” 

See accompanying notes to condensed consolidated financial statements.

 

 

 

HUNTSMAN CORPORATION AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Millions, Except Per Share Amounts)

   

Three months

   

Nine months

 
   

ended

   

ended

 
   

September 30,

   

September 30,

 
   

2022

   

2021

   

2022

   

2021

 

Revenues:

                               

Trade sales, services and fees, net

  $ 1,946     $ 2,042     $ 6,189     $ 5,418  

Related party sales

    65       55       184       140  

Total revenues

    2,011       2,097       6,373       5,558  

Cost of goods sold

    1,662       1,660       5,017       4,397  

Gross profit

    349       437       1,356       1,161  

Operating expenses:

                               

Selling, general and administrative

    165       176       532       536  

Research and development

    31       35       97       102  

Restructuring, impairment and plant closing costs (credits)

    12       (1 )     36       34  

Gain on sale of India-based DIY business

                      (28 )

Other operating expense (income), net

    3       (3 )     (8 )     (13 )

Total operating expenses

    211       207       657       631  

Operating income

    138       230       699       530  

Interest expense, net

    (16 )     (15 )     (46 )     (52 )

Equity in income of investment in unconsolidated affiliates

    21       34       55       118  

Fair value adjustments to Venator investment, net

    (7 )     (3 )     (9 )     (28 )

Loss on early extinguishment of debt

                      (27 )

Other income, net

    10       7       23       21  

Income from continuing operations before income taxes

    146       253       722       562  

Income tax expense

    (30 )     (34 )     (155 )     (101 )

Income from continuing operations

    116       219       567       461  

(Loss) income from discontinued operations, net of tax

    (1 )     6       30       36  

Net income

    115       225       597       497  

Net income attributable to noncontrolling interests

    (15 )     (16 )     (46 )     (49 )

Net income attributable to Huntsman Corporation

  $ 100     $ 209     $ 551     $ 448  
                                 

Basic income per share:

                               

Income from continuing operations attributable to Huntsman Corporation common stockholders

  $ 0.52     $ 0.93     $ 2.54     $ 1.87  

(Loss) income from discontinued operations attributable to Huntsman Corporation common stockholders, net of tax

    (0.01 )     0.02       0.15       0.16  

Net income attributable to Huntsman Corporation common stockholders

  $ 0.51     $ 0.95     $ 2.69     $ 2.03  

Weighted average shares

    197.7       219.4       205.2       220.2  
                                 

Diluted income per share:

                               

Income from continuing operations attributable to Huntsman Corporation common stockholders

  $ 0.51     $ 0.92     $ 2.52     $ 1.86  

(Loss) income from discontinued operations attributable to Huntsman Corporation common stockholders, net of tax

    (0.01 )     0.02       0.14       0.16  

Net income attributable to Huntsman Corporation common stockholders

  $ 0.50     $ 0.94     $ 2.66     $ 2.02  

Weighted average shares

    199.2       221.3       207.2       222.2  
                                 

Amounts attributable to Huntsman Corporation:

                               

Income from continuing operations

  $ 101     $ 203     $ 521     $ 412  

(Loss) income from discontinued operations, net of tax

    (1 )     6       30       36  

Net income

  $ 100     $ 209     $ 551     $ 448  

See accompanying notes to condensed consolidated financial statements.

 

 

HUNTSMAN CORPORATION AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(In Millions) 

   

Three months

   

Nine months

 
   

ended

   

ended

 
   

September 30,

   

September 30,

 
   

2022

   

2021

   

2022

   

2021

 

Net income

  $ 115     $ 225     $ 597     $ 497  

Other comprehensive (loss) income, net of tax:

                               

Foreign currency translations adjustments

    (204 )     (36 )     (338 )     (42 )

Pension and other postretirement benefits adjustments

    10       17       28       52  

Other, net

                (1 )      

Other comprehensive (loss) income, net of tax

    (194 )     (19 )     (311 )     10  

Comprehensive (loss) income

    (79 )     206       286       507  

Comprehensive loss (income) attributable to noncontrolling interests

    (6 )     (17 )     (29 )     (51 )

Comprehensive (loss) income attributable to Huntsman Corporation

  $ (85 )   $ 189     $ 257     $ 456  

 

 

 

HUNTSMAN CORPORATION AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(In Millions, Except Share Amounts)

  

Huntsman Corporation Stockholders' Equity

         
                          

Accumulated

         
  

Shares

      

Additional

      

Unearned

      

other

  

Noncontrolling

     
  

common

  

Common

  

paid-in

  

Treasury

  

stock-based

  

Retained

  

comprehensive

  

interests in

  

Total

 
  

stock

  

stock

  

capital

  

stock

  

compensation

  

earnings

  

loss

  

subsidiaries

  

equity

 

Balance, January 1, 2022

  214,170,287  $3  $4,102  $(934) $(25) $2,435  $(1,203) $181  $4,559 

Net income

                 223      17   240 

Other comprehensive loss

                    (11)  (1)  (12)

Issuance of nonvested stock awards

        32      (32)            

Vesting of stock awards

  1,327,568      7                  7 

Recognition of stock-based compensation

        1      8            9 

Repurchase and cancellation of stock awards

  (361,250)              (13)        (13)

Stock options exercised

  387,899      10         (5)        5 

Treasury stock repurchased

  (5,549,348)        (210)              (210)

Dividends declared on common stock ($0.2125 per share)

                 (45)        (45)

Balance, March 31, 2022

  209,975,156   3   4,152   (1,144)  (49)  2,595   (1,214)  197   4,540 

Net income

                 228      14   242 

Other comprehensive loss

                    (98)  (7)  (105)

Vesting of stock awards

  4,045                         

Recognition of stock-based compensation

        1      8            9 

Repurchase and cancellation of stock awards

  (2,416)              (1)        (1)

Stock options exercised

  66,840      1                  1 

Treasury stock repurchased

  (8,371,423)        (291)              (291)

Dividends declared on common stock ($0.2125 per share)

                 (44)        (44)

Balance, June 30, 2022

  201,672,202   3   4,154   (1,435)  (41)  2,778   (1,312)  204   4,351 

Net income

                 100      15   115 

Other comprehensive loss

                    (185)  (9)  (194)

Vesting of stock awards

  10,174                         

Recognition of stock-based compensation

        1      4            5 

Repurchase and cancellation of stock awards

  (2,533)                        

Stock options exercised

  10,432                         

Treasury stock repurchased

  (8,932,915)        (251)              (251)

Dividends declared on common stock ($0.2125 per share)

                 (42)        (42)

Balance, September 30, 2022

  192,757,360  $3  $4,155  $(1,686) $(37) $2,836  $(1,497) $210  $3,984 

 

HUNTSMAN CORPORATION AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(In Millions, Except Share Amounts)

 

  Huntsman Corporation Stockholders' Equity         
                          

Accumulated

         
  

Shares

      

Additional

      

Unearned

      

other

  

Noncontrolling

     
  

common

  

Common

  

paid-in

  

Treasury

  

stock-based

  

Retained

  

comprehensive

  

interests in

  

Total

 
  

stock

  

stock

  

capital

  

stock

  

compensation

  

earnings

  

loss

  

subsidiaries

  

equity

 

Balance, January 1, 2021

  220,046,262  $3  $4,048  $(731) $(19) $1,564  $(1,346) $154  $3,673 

Net income

                 83      17   100 

Other comprehensive loss

                    (13)     (13)

Issuance of nonvested stock awards

        25      (25)            

Vesting of stock awards

  664,818      5                  5 

Recognition of stock-based compensation

        2      6            8 

Repurchase and cancellation of stock awards

  (202,961)              (6)        (6)

Stock options exercised

  204,005      5         (2)        3 

Dividends declared on common stock ($0.1625 per share)

                 (36)        (36)

Balance, March 31, 2021

  220,712,124   3   4,085   (731)  (38)  1,603   (1,359)  171   3,734 

Net income

                 156      16   172 

Other comprehensive income

                    41   1   42 

Vesting of stock awards

  3,732                         

Recognition of stock-based compensation

        2      4            6 

Repurchase and cancellation of stock awards

  (19,912)              (1)        (1)

Stock options exercised

  263,962      6         (3)        3 

Dividends declared to noncontrolling interests

                       (30)  (30)

Dividends declared on common stock ($0.1875 per share)

                 (41)        (41)

Balance, June 30, 2021

  220,959,906   3   4,093   (731)  (34)  1,714   (1,318)  158   3,885 

Net income

                 209      16   225 

Other comprehensive (loss) income

                    (20)  1   (19)

Issuance of nonvested stock awards

        1      (1)            

Vesting of stock awards

  7,695                         

Recognition of stock-based compensation

        1      5            6 

Repurchase and cancellation of stock awards

  (1,869)                        

Stock options exercised

  34,372      1                  1 

Treasury stock repurchased

  (3,971,784)        (102)              (102)

Dividends declared on common stock ($0.1875 per share)

                 (42)        (42)

Balance, September 30, 2021

  217,028,320  $3  $4,096  $(833) $(30) $1,881  $(1,338) $175  $3,954 

 

 

 

See accompanying notes to condensed consolidated financial statements.

 

 

HUNTSMAN CORPORATION AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Millions)

  

Nine months

 
  

ended

 
  

September 30,

 
  

2022

  

2021

 

Operating Activities:

        

Net income

 $597  $497 

Less: Income from discontinued operations, net of tax

  (30)  (36)

Income from continuing operations

  567   461 

Adjustments to reconcile income from continuing operations to net cash provided by operating activities from continuing operations:

        

Equity in income of investment in unconsolidated affiliates

  (55)  (118)

Unrealized net losses on fair value adjustments to Venator investment

  9   28 

Cash received from return on investment in unconsolidated subsidiary

  61   31 

Depreciation and amortization

  207   205 

Noncash lease expense

  47   42 

Gain on disposal of businesses/assets

     (28)

Loss on early extinguishment of debt

     27 

Noncash restructuring and impairment charges

  (1)  14 

Deferred income taxes

  81   (22)

Stock-based compensation

  26   23 

Other, net

  (15)  (6)

Changes in operating assets and liabilities:

        

Accounts and notes receivable

  (60)  (335)

Inventories

  (128)  (270)

Other current assets

  357   20 

Other noncurrent assets

  (14)  (84)

Accounts payable

  (113)  134 

Accrued liabilities

  (292)  88 

Other noncurrent liabilities

  (82)  (28)

Net cash provided by operating activities from continuing operations

  595   182 

Net cash provided by (used in) operating activities from discontinued operations

  9   (20)

Net cash provided by operating activities

  604   162 
         

Investing Activities:

        

Capital expenditures

  (186)  (241)

Cash received from sale of business

     43 

Acquisition of business, net of cash acquired

     (245)

Insurance proceeds for recovery of property damage

  5   3 

Other, net

  5   10 

Net cash used in investing activities from continuing operations

  (176)  (430)

Net cash used in investing activities from discontinued operations

  (12)  (9)

Net cash used in investing activities

  (188)  (439)
         

Financing Activities:

        

Net borrowings on revolving loan facilities

     8 

Proceeds from issuance of long-term debt

     427 

Repayments of long-term debt

  (8)  (965)

Debt issuance costs paid

     (4)

Dividends paid to noncontrolling interests

     (30)

Dividends paid to common stockholders

  (132)  (119)

Repurchase and cancellation of awards

  (14)  (7)

Repurchase of common stock

  (755)  (102)

Proceeds from issuance of common stock

  6   7 

Costs of early extinguishment of debt

     (26)

Other, net

  (2)  2 

Net cash used in financing activities

  (905)  (809)

Effect of exchange rate changes on cash

  (37)  (2)

Decrease in cash and cash equivalents

  (526)  (1,088)

Cash and cash equivalents at beginning of period

  1,041   1,593 

Cash and cash equivalents at end of period

 $515  $505 
         

Supplemental cash flow information:

        

Cash paid for interest

 $41  $57 

Cash paid for income taxes

  171   83 

As of September 30, 2022 and 2021, the amount of capital expenditures in accounts payable was $27 million and $52 million, respectively. For the nine months ended September 30, 2021, the amount of cash paid for taxes in connection with the earnout provision achieved under the terms of the sales agreement of the India-based do-it-yourself (“DIY”) business was $3 million. See “Note 4. Discontinued Operations and Business Dispositions— Sale of India-Based Do-It-Yourself Consumer Adhesives Business.”

 

​See accompanying notes to condensed consolidated financial statements.

 

 

HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In Millions, Except Unit Amounts)

  

September 30,

  

December 31,

 
  

2022

  

2021

 

ASSETS

        

Current assets:

        

Cash and cash equivalents(a)

 $515  $1,039 

Accounts and notes receivable (net of allowance for doubtful accounts of $11 and $12, respectively), ($348 and $324 pledged as collateral, respectively)(a)

  981   988 

Accounts receivable from affiliates

  1,035   269 

Inventories(a)

  1,079   1,038 

Receivable associated with the Albemarle Settlement

     333 

Other current assets

  115   153 

Current assets held for sale

  483   346 

Total current assets

  4,208   4,166 

Property, plant and equipment, net(a)

  2,288   2,443 

Investment in unconsolidated affiliates

  430   470 

Intangible assets, net

  433   469 

Goodwill

  636   650 

Deferred income taxes

  167   180 

Operating lease right-of-use assets

  359   381 

Other noncurrent assets(a)

  623   690 

Noncurrent assets held for sale

     182 

Total assets

 $9,144  $9,631 
         

LIABILITIES AND EQUITY

        

Current liabilities:

        

Accounts payable(a)

 $865  $1,051 

Accounts payable to affiliates

  40   62 

Accrued liabilities(a)

  386   704 

Current portion of debt(a)

  12   12 

Current operating lease liabilities(a)

  50   49 

Current liabilities held for sale

  242   163 

Total current liabilities

  1,595   2,041 

Long-term debt(a)

  1,476   1,538 

Deferred income taxes

  251   163 

Noncurrent operating lease liabilities(a)

  326   346 

Other noncurrent liabilities(a)

  494   573 

Noncurrent liabilities held for sale

     151 

Total liabilities

  4,142   4,812 

Commitments and contingencies (Notes 15 and 16)

          

Equity

        

Huntsman International LLC members’ equity:

        

Members’ equity, 2,728 units issued and outstanding

  3,756   3,732 

Retained earnings

  2,518   2,093 

Accumulated other comprehensive loss

  (1,482)  (1,187)

Total Huntsman International LLC members’ equity

  4,792   4,638 

Noncontrolling interests in subsidiaries

  210   181 

Total equity

  5,002   4,819 

Total liabilities and equity

 $9,144  $9,631 

 


(a)

At September 30, 2022 and December 31, 2021, respectively, $22 and $1 of cash and cash equivalents, $4 and $12 of accounts and notes receivable (net), $60 and $64 of inventories, $161 each of property, plant and equipment (net), $29 and $23 of other noncurrent assets, $126 and $146 of accounts payable, $11 and $13 of accrued liabilities, $10 each of current portion of debt, $10 and $6 of current operating lease liabilities, $28 and $35 of long-term debt, $21 and $20 of noncurrent operating lease liabilities and $45 and $46 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See “Note 6. Variable Interest Entities.” 

See accompanying notes to condensed consolidated financial statements.

 

 

HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Millions)

   

Three months

   

Nine months

 
   

ended

   

ended

 
   

September 30,

   

September 30,

 
   

2022

   

2021

   

2022

   

2021

 

Revenues:

                               

Trade sales, services and fees, net

  $ 1,946     $ 2,042     $ 6,189     $ 5,418  

Related party sales

    65       55       184       140  

Total revenues

    2,011       2,097       6,373       5,558  

Cost of goods sold

    1,662       1,660       5,017       4,397  

Gross profit

    349       437       1,356       1,161  

Operating expenses:

                               

Selling, general and administrative

    166       175       528       530  

Research and development

    31       35       97       102  

Restructuring, impairment and plant closing costs (credits)

    12       (1 )     36       34  

Gain on sale of India-based DIY business

                      (28 )

Other operating expense (income), net

    3       (3 )     (8 )     (13 )

Total operating expenses

    212       206       653       625  

Operating income

    137       231       703       536  

Interest expense, net

    (16 )     (15 )     (46 )     (52 )

Equity in income of investment in unconsolidated affiliates

    21       34       55       118  

Fair value adjustments to Venator investment, net

    (7 )     (3 )     (9 )     (28 )

Loss on early extinguishment of debt

                      (27 )

Other income, net

    10       7       23       19  

Income from continuing operations before income taxes

    145       254       726       566  

Income tax expense

    (30 )     (35 )     (156 )     (102 )

Income from continuing operations

    115       219       570       464  

(Loss) income from discontinued operations, net of tax

    (1 )     6       30       36  

Net income

    114       225       600       500  

Net income attributable to noncontrolling interests

    (15 )     (16 )     (46 )     (49 )

Net income attributable to Huntsman International LLC

  $ 99     $ 209     $ 554     $ 451  

See accompanying notes to condensed consolidated financial statements.

 

 

HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME 

(In Millions)

   

Three months

   

Nine months

 
   

ended

   

ended

 
   

September 30,

   

September 30,

 
   

2022

   

2021

   

2022

   

2021

 

Net income

  $ 114     $ 225     $ 600     $ 500  

Other comprehensive (loss) income, net of tax:

                               

Foreign currency translations adjustment

    (204 )     (36 )     (339 )     (42 )

Pension and other postretirement benefits adjustments

    10       17       28       53  

Other, net

                (1 )      

Other comprehensive (loss) income, net of tax

    (194 )     (19 )     (312 )     11  

Comprehensive (loss) income

    (80 )     206       288       511  

Comprehensive loss (income) attributable to noncontrolling interests

    (6 )     (17 )     (29 )     (51 )

Comprehensive (loss) income attributable to Huntsman International LLC

  $ (86 )   $ 189     $ 259     $ 460  

See accompanying notes to condensed consolidated financial statements.

 

 

HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(In Millions, Except Unit Amounts)

  

Huntsman International LLC Members

         
  

Members'

      

Accumulated other

  

Noncontrolling

     
  

equity

      

comprehensive

  

interests in

  

Total

 
  

Units

  

Amount

  

Retained earnings

  

loss

  

subsidiaries

  

equity

 

Balance, January 1, 2022

  2,728  $3,732  $2,093  $(1,187) $181  $4,819 

Net income

        226      17   243 

Dividends paid to parent

        (45)        (45)

Other comprehensive loss

           (11)  (1)  (12)

Contribution from parent

     9            9 

Balance, March 31, 2022

  2,728   3,741   2,274   (1,198)  197   5,014 

Net income

        229      14   243 

Dividends paid to parent

        (42)        (42)

Other comprehensive loss

           (99)  (7)  (106)

Contribution from parent

     10            10 

Balance, June 30, 2022

  2,728   3,751   2,461   (1,297)  204   5,119 

Net income

        99      15   114 

Dividends paid to parent

        (42)        (42)

Other comprehensive loss

           (185)  (9)  (194)

Contribution from parent

     5