• Cost Savings: Over $40 million in cost savings initiatives delivered in less than 12 months.
• SG&A Reduction: SG&A expenses dropped by more than 6%.
• Inflationary Costs Offset: More than $150 million of global inflationary costs offset since 2022.
• Facility Closures: Closure and relocation of multiple facilities, including Deggendorf, Germany, and King's Lynn, UK.
• Price Increases: Announced price increases in North America for MDI products.
• MDI Pricing: Publicly reported polymeric MDI prices in China at a three-year high.

• Warning! GuruFocus has detected 8 Warning Signs with HUN.

Release Date: February 18, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Huntsman Corp (NYSE:HUN) has successfully implemented cost-cutting measures, saving over $150 million since 2022, which has helped offset global inflationary pressures.
• The company has announced a series of price increases in North America for its MDI products, indicating a potential recovery in pricing and margins.
• Huntsman Corp (NYSE:HUN) has strategically relocated and consolidated its operations, including opening new global business service hubs in San Jose, Costa Rica, and Krakow, Poland.
• The company has seen early signs of recovery in demand and pricing for its MDI products, particularly in China, where prices are at a three-year high.
• Huntsman Corp (NYSE:HUN) is focusing on optimizing its asset footprint and pushing for margin expansion, positioning itself well for future demand and pricing recovery.

Negative Points

• The company is facing challenges in Europe due to industrial decline and increased competition from imports, particularly from China and Eastern Europe.
• Huntsman Corp (NYSE:HUN) has announced the closure of several facilities, including those in Germany and the UK, as part of its restructuring efforts.
• The company's Performance Products segment is experiencing a decline in profitability, primarily due to challenges in the European maleic anhydride market.
• Huntsman Corp (NYSE:HUN) is cautious about providing long-term guidance due to geopolitical uncertainties and market volatility.
• The company is dealing with the impact of tariffs and trade disruptions, which could affect its operations and profitability in the coming quarters.

Q & A Highlights

Q: In the midst of restructuring actions, can you help us understand the size and scope of these actions, particularly in the downstream business? Is there any concern about fulfilling demand improvement when it comes? A: Peter Huntsman, CEO, explained that the company is calibrating its business around customer needs and pricing. As customers relocate from Europe to Asia and the U.S., Huntsman is following them by expanding downstream capacities in those regions. The company is consolidating system houses and utilizing assets more efficiently, especially in Europe, where demand has decreased. Huntsman is also withdrawing from some Southeast Asian markets where margins are less favorable.

Q: In Performance Products, you mentioned margins improving earlier this year. What markets are driving this volume improvement? A: Peter Huntsman noted that Performance Products will improve gradually, driven by recovery in the construction sector, particularly in the maleic business. The company is also expanding its Conroe, Texas site to service the chip industry, which will contribute to sales later in the year as customer qualifications are completed.

Q: Can you provide more color on the maleic announcement and its impact on European construction? A: Peter Huntsman stated that the company is exploring options for its maleic anhydride facility in Europe due to increased competition from imports, particularly from China and Turkey. The business is currently experiencing negative EBITDA, and Huntsman is evaluating whether it is the best owner for the facility in the long term.

Q: What are your thoughts on the potential impact of U.S. antidumping probes on Chinese MDI imports? A: Peter Huntsman mentioned that the company is participating in the U.S. ITC investigation. While a final decision may take a year, Huntsman believes a ruling against dumping could benefit the company by reducing competition from Chinese imports.

Q: How do you view the potential for price increases in the U.S. MDI market, and what are the implications for volume? A: Peter Huntsman expressed optimism about price increases in the U.S. MDI market, noting that multiple players are announcing price hikes across various segments. He emphasized that the company aims to achieve price increases without sacrificing market share or volume.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.