Huntsman Corporation Reports Fourth Quarter 2024 Earnings with Continued Market Challenges

Huntsman Corporation Reports Fourth Quarter 2024 Earnings

Huntsman Corporation recently disclosed its financial performance for the fourth quarter of 2024, revealing a continued struggle amid challenging market conditions. The chemical manufacturer reported a net loss of $141 million, compared to a net loss of $71 million during the same period last year. This trend reflects ongoing difficulties in core markets, particularly in the construction and automotive sectors.

Financial Highlights
In terms of earnings per share, the diluted loss increased to $0.82 from $0.41 year-on-year. While the adjusted net loss for the same period was $43 million, this represents a slight deterioration compared to an adjusted net loss of $36 million from the prior year. The adjusted EBITDA, however, saw an increase to $71 million, up from $44 million the previous year, demonstrating some improved operational efficiency despite declining net income.

For the full year, Huntsman reported revenues of $6,036 million compared to $6,111 million in 2023. The continuing operations generated $159 million in net cash from operating activities during the quarter, contributing to a free cash flow of $108 million for Q4 2024, surpassing the $83 million recorded in Q4 2023.

Market Analysis
Peter R. Huntsman, the Chairman, President, and CEO of Huntsman Corporation, commented on the quarter's performance, indicating that although there was a volume improvement of 5% compared to last year, it has yet to translate into required margin enhancements. He pointed out that the construction and automotive markets, which comprise approximately two-thirds of the company's portfolio, are currently subdued, notably affecting overall demand.

Looking forward to 2025, he mentioned the expectation of modest growth in the automotive sector in China, along with stable profitability. On the other hand, the European markets are under significant pressure due to high energy costs and excessive regulations, coupled with an oversupply in capacity.

Segment Performance

Polyurethanes

The Polyurethanes segment reported an increase in revenues primarily attributed to higher sales volumes, driven by a rise in demand and market share gains in insulation and composite wood panels. Consequently, this segment saw significant growth in adjusted EBITDA, strengthened by improved margins and reduced operational costs, despite lower equity earnings from a joint venture in China.

Performance Products

Conversely, the Performance Products segment experienced a decline in revenues due to lower sales volumes, with some offset from rising average selling prices. The slowdown was mainly influenced by prolonged outages related to Maleic Anhydride production and a reduction in construction activity. This led to a decrease in segment adjusted EBITDA as volumes dropped, albeit with cost optimizations offsetting some losses.

Advanced Materials

The Advanced Materials segment fared better with an increase in revenues, which can be credited to higher sales volumes in infrastructure and general industry segments, despite facing lower average selling prices due to an unfavorable sales mix. The section's adjusted EBITDA remained flat, maintaining previous levels thanks to these volume increases.

Outlook and Strategic Moves
To navigate these market challenges, Huntsman plans to implement cost-control measures, including workforce reductions in the Polyurethanes segment. Moreover, the corporation will evaluate strategic options related to its European maleic anhydride business and consider potentially closing certain downstream Polyurethanes facilities.

Huntsman Corporation remains focused on protecting its balance sheet and ensuring operational readiness to capitalize on future market improvements. As the company enters 2025, it is committed to creating a leaner structure that will allow for substantial operating leverage when demands increase meaningfully.

Conclusion
In summary, Huntsman's fourth-quarter performance highlights the ongoing market challenges and the company’s proactive steps toward maintaining financial stability and operational efficiency. As the landscape continues to evolve, the company’s agility in response to these circumstances will be pivotal for its future success.

For a more in-depth discussion on these results, Huntsman will host a conference call on February 18, 2025, to elaborate on its fourth-quarter outcomes and future prospects.