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Huntsman earnings surge on strong MDI pricing

February 15/2021

MOSCOW (MRC) -- Huntsman (The Woodlands, Texas) reports fourth-quarter adjusted net income of USD113 million, up 74% from USD65 million on strong results in the polyurethanes segment, reported Chemweek.

Adjusted earnings per share were USD0.51, beating the average analyst estimate of USD0.44 as compiled by Zacks Investment Research.

Sales totaled USD1.668 billion, up 0.7% YOY from USD1.657 billion. GAAP net income totaled USD360 million, up 17% year-over-year (YOY) from USD308 million.

Revenue in the polyurethanes segment totaled USD1.03 billion, up 5% YOY on higher average pricing for methylene di-para-phenylene diisocyanate (MDI), mainly in China and Europe, partially offset by lower sales volume, which stemmed from unplanned supplier outages. Adjusted EBITDA increased 65% YOY to USD201 million on higher MDI margins driven by higher pricing, partially offset by lower sales volumes. Volumes in building solutions and automotive increased YOY, a trend the company expects will continue in the first quarter, doubling adjusted EBITDA YOY.

Performance products revenue totaled USD265 million, down 5% YOY as sales volume and average selling prices declined owing to to weaker market conditions for several amines businesses. The slight decrease in Adjusted EBITDA declined 5% to USD41 million for the same reason. Huntsman expects first-quarter adjusted EBITDA to increase 10-15% YOY on improved volumes in Asia and the Americas.

Advanced materials revenue dropped 14% YOY to USD207 million as weakness, mainly in the aerospace and commodity markets, reduced sales volume. Adjusted EBITDA decreased due to lower sales volume, partially offset by lower fixed cost. Adjusted EBITDA dropped 36% YOY to USD27 million as the contribution of recently acquired CVC Thermoset Specialties was offset by the divestiture of the India-based DIY consumer adhesives business. The company expects a roughly 40% sequential increase in adjusted EBITDA on improvements in all markets.

Textile effects revenue declined 4% YOY to USD173 million on lower average selling price, the result of lower raw material cost, partially offset by higher sales volume, mainly in the Asia region. Adjusted EBITDA was flat at USD18 million as lower raw material and fixed costs offset the decline in revenue.

As MRC informed earlier, in late December, 2020, SK Capital Partners completed the acquisition of a 39.75% stake, roughly 42.4 million shares, in titanium dioxide maker Venator from Huntsman for roughly USD100 million. The deal includes a 30-month option for the purchase of Huntsmans remaining approximate 9.5 million shares by SK at US2.15/share. Huntsman spun off Venator in a 2017 initial public offering.

We remind that Nanjing Jinling Huntsman, a joint venture between Huntsman and Sinopec Jinling, shut its propylene oxide plant in Nanjing (Nanjing, Jiangsu Province, China) on November 1, 2020, for scheduled maintenance. This plant with a capacity of 240,000 tonnes/year of propylene oxide was closed until approximately 25 November.

Propylene is the main feedstock for the production of polypropylene (PP).

According to MRC's ScanPlast report, PP shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020).

Huntsman Corporation is a publicly traded global manufacturer and marketer of differentiated and specialty chemicals with 2019 revenues of approximately USD7 billion. The company's chemical products number in the thousands and are sold worldwide to manufacturers serving a broad and diverse range of consumer and industrial end markets. The company operates more than 70 manufacturing, R&D and operations facilities in approximately 30 countries and employ approximately 9,000 associates within our four distinct business divisions.
Author:Margaret Volkova
Tags:Asia, Europe, North America, South America, PP, poliuretan, propylene, petrochemistry, footwear, Huntsman, Sinopec, SK Corporation, China, Russia.
Category:General News
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