Huntsman (HUN) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenues were $1.54 billion, up 2% year-over-year, with adjusted EBITDA of $131 million and a net loss of $33 million; volumes improved 5% year-over-year across all segments, but margin pressure and weak demand, especially in Europe, persisted.

• Net loss attributable to the company ranged from $17 million to $33 million due to higher interest expense and lower equity income; adjusted net income was $17 million.

• Free cash flow from continuing operations was $93 million, supported by a $34–$35 million dividend from the SLIC China JV liquidation.

• Management expects trough conditions in core construction and industrial markets to persist through Q4, with medium-term improvement possible from global rate cuts and Chinese stimulus.

• Cost reduction programs totaling $50 million are underway in polyurethanes, mainly targeting Europe, with further restructuring actions planned for 2025–2026.

Financial highlights

• Adjusted EBITDA margin for Q3 2024 was 8–9%; gross profit was $234 million; operating cash flow from continuing operations was $134 million.

• Dividend per share increased to $0.25, yielding about 4.5%; no share repurchases in Q3.

• SG&A expenses were flat or down year-over-year, mainly due to reduced incentive compensation.

• Net debt at quarter-end was $1.5 billion, with $1.7 billion in available liquidity.

• Free cash flow conversion improved year-over-year, with capital expenditures of $41 million in Q3 and $133 million year-to-date.

Outlook and guidance

• Q4 2024 adjusted EBITDA guidance is $60–$90 million, with Polyurethanes $45–$60 million, Performance Products $20–$30 million, and Advanced Materials $35–$40 million.

• Seasonally lower Q4 volumes expected (down 5–10% sequentially), with stable pricing and continued margin pressure in Europe.

• Full-year 2024 capital expenditures expected at $180–$190 million; adjusted effective tax rate guidance is 30–34%.

• Management anticipates gradual improvement in 2025, especially in Asia and North America, driven by housing, automotive, and potential interest rate cuts.

• Additional Polyurethanes restructuring actions are planned for 2025–2026, targeting $40–$50 million in adjusted EBITDA improvements.