MOSCOW (MRC) -- Houston-area chemical maker Huntsman Corporation saw mixed results in the fourth quarter as it weathered weakening demand and lower prices, but still still ended 2018 with a solid profit for the years, said the company.
The Woodlands company said it lost USD315 million in the fourth quarter, compared to a profit of USD287 million the same period last year. Its revenue for the fourth quarter stayed essentially flat at about USD2.2 billion.
For all of 2018, Huntsman reported USD615 million profit, down 17 percent from USD741 million in 2017. Revenues, however, jumped by USD1 billion, or 12 percent to USD9.3 billion last year from USD8.3 billion in 2017.
Huntsman blamed the decline in annual profits on its 49 percent holdings in Venator, the pigments and additives company that Huntsman spun off into a separate public company in 2017. Venator's stock price has plummeted 73 percent to USD5.50 per a share since it debuted because of volatility in the pigments and additives market.
Huntsman is trying to sell all or most of its shares in Venator, a Huntsman company spokesperson said.
Revenue from on its major segments, polyurethane, dipped in the fourth quarter because of lower average selling prices in China and Europe. Polyurethanes are chemicals used to make high-resilience foam seating, rigid foam insulation panels, microcellular foam seals and gaskets, durable elastomeric wheels and tires.
Lower polyurethane prices were partially offset by a 5 percent boost in production volume thanks to the start of a MDI polyurethane plant in China and the April 2018 acquisition of Demilec, a North American polyurethane spray foam company.
Uncertainty in global markets tied to Brexit and U.S.-Chinese trade talks spurred many of Huntsman's customers to rely on their existing inventories rather buy up new products in a "wait-and-see" approach known as destocking.
Despite all of this its MDI urethane business still reported the second best fourth quarter in terms of earnings in the company's history, Peter R. Huntsman, CEO of Huntsman told investors.
Looking ahead Huntsman's CEO told investors in Tuesday earnings call he expects demand to pick up in 2019 based on higher orders the company has seen so far this year. If a trade deal with China is reached that could boost demand too, Huntsman said. A Brexit deal could have a relatively minimal (USD15 million) negative impact on its supply chain in Europe, he added.
MRC