Huntsman (HUN) Q4 2004 earnings summary

Executive summary

• 2004 was a record year: revenue rose 24% to $11,426.4 million and Adjusted EBITDA rose 57.1% to $1,247.5 million versus 2003 pro forma, despite high, volatile energy and feedstock costs.

• Differentiated businesses generated 52% of 2004 revenue and approximately 60% of Adjusted EBITDA; operations spanned 62 facilities in 22 countries, with 11,300 employees.

Financial highlights

• 2004 pro forma comparison: gross profit $1,404.4 million, up 40%; operating income $408.2 million, up 92%; net loss $227.7 million versus $426.1 million.

• 2004 Adjusted EBITDA was $1,247.5 million versus $794.3 million pro forma; excluding unusual items, EBITDA was $892.6 million versus $663.5 million.

• LTM ended June 30, 2005: revenue $12,740.4 million, Adjusted EBITDA $1,654.7 million, and net income from continuing operations $106.6 million.

• 2004 net loss per share was $1.43; loss from continuing operations was $1.40 per share, with discontinued operations contributing $0.03 per share of loss.

Outlook and guidance

• Project Coronado targeted $200 million of annual fixed-cost reductions versus 2002; full implementation was expected by year-end 2005.

• If economic growth in the U.S., Europe and Asia remained stable, improving supply-demand conditions were expected to create opportunities for wider margins in 2006; energy, feedstock and natural-disaster impacts remained uncertain.

• Planned 2005 capital spending was approximately $400 million, plus $57 million for the Consolidated Chinese Splitting JV; completion of the Chinese MDI facilities was expected in 2006.

• The Wilton LDPE plant was planned for completion in late 2007, with annual capacity of approximately 900 million pounds and estimated construction cost of $300 million net of grant proceeds.