Quarterly report [Sections 13 or 15(d)]

Note 21 - Operating Segment Information

v3.25.1
Note 21 - Operating Segment Information
 3 Months Ended
Mar. 31, 2025
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]

21. OPERATING SEGMENT INFORMATION 

​

We derive our revenues, earnings and cash flows from the manufacture and sale of a wide variety of diversified organic chemical products. We have three operating segments, which are also our reportable segments: Polyurethanes, Performance Products and Advanced Materials. We have organized our business and derived our operating segments around differences in product lines. 

 

The major products of each reportable operating segment are as follows:

​

Segment

    

Products

Polyurethanes

​

MDI, polyols, TPU and other polyurethane-related products

Performance Products

​

Performance amines, ethyleneamines and maleic anhydride

Advanced Materials

​

Technologically-advanced epoxy, phenoxy, acrylic, polyurethane and acrylonitrile-butadiene-based polymer formulations; high performance thermoset resins, curing agents, toughening agents, and carbon nanomaterials

 

Sales between segments are generally recognized at external market prices and are eliminated in consolidation. We use adjusted EBITDA to measure the financial performance of our global business units and for reporting the results of our operating segments. This measure includes all operating items relating to the businesses. The adjusted EBITDA of operating segments excludes items that principally apply to our Company as a whole. The following schedule includes revenues, significant segment expenses and adjusted EBITDA for each of our reportable operating segments (dollars in millions). 

 

Huntsman Corporation

   

Three months ended March 31, 2025

  
   

Polyurethanes

    

Performance Products

    

Advanced Materials

    

Total

  

Revenues:

                                

Reportable segments’ revenues(1)

   $ 912     $ 257     $ 249     $ 1,418  
                                 

Significant segment expenses:

                                

Variable direct costs(2)

     682       137       116       935  

Adjusted fixed costs(3)

     186       84       101       371  

Other segment items(4)

     2       6       (4 )     4  

Total reportable segments’ adjusted EBITDA(5)

   $ 42     $ 30     $ 36       108  
                                 

Reconciliation of total reportable segments’ adjusted EBITDA to income from continuing operations before income taxes:

                                

Interest expense, net—continuing operations

                             (19 )

Depreciation and amortization—continuing operations

                             (69 )

Corporate and other costs, net(6)

                             (36 )

Net income attributable to noncontrolling interests

                             16  

Other adjustments:

                                

Business acquisition and integration gain and purchase accounting inventory adjustments, net

                             5  

Certain legal and other settlements and related income

                             33  

Amortization of pension and postretirement actuarial losses

                             (7 )

Restructuring, impairment and plant closing and transition costs(7)

                             (4 )

Income from continuing operations before income taxes

                             27  
                                 

Income tax expense—continuing operations

                             (15 )

Loss from discontinued operations, net of tax

                             (1 )

Net income

                           $ 11  

 

   

Three months ended March 31, 2024

  
   

Polyurethanes

    

Performance Products

    

Advanced Materials

    

Total

  

Revenues:

                                

Reportable segments’ revenues(1)

   $ 926     $ 291     $ 261     $ 1,478  
                                 

Significant segment expenses:

                                

Variable direct costs(2)

     705       160       122       987  

Adjusted fixed costs(3)

     198       83       98       379  

Other segment items(4)

     (16 )     6       (2 )     (12 )

Total reportable segments’ adjusted EBITDA(5)

   $ 39     $ 42     $ 43       124  
                                 

Reconciliation of total reportable segments’ adjusted EBITDA to loss from continuing operations before income taxes:

                                

Interest expense, net—continuing operations

                             (19 )

Depreciation and amortization—continuing operations

                             (69 )

Corporate and other costs, net(6)

                             (43 )

Net income attributable to noncontrolling interests

                             14  

Other adjustments:

                                

Business acquisition and integration expenses and purchase accounting inventory adjustments, net

                             (20 )

Certain legal and other settlements and related expenses

                             (1 )

Amortization of pension and postretirement actuarial losses

                             (8 )

Restructuring, impairment and plant closing and transition costs(7)

                             (14 )

Loss from continuing operations before income taxes

                             (36 )
                                 

Income tax benefit—continuing operations

                             20  

Loss from discontinued operations, net of tax

                             (7 )

Net loss

                           $ (23 )

 

Huntsman International

   

Three months ended March 31, 2025

  
   

Polyurethanes

    

Performance Products

    

Advanced Materials

    

Total

  

Revenues:

                                

Reportable segments’ revenues(1)

   $ 912     $ 257     $ 249     $ 1,418  
                                 

Significant segment expenses:

                                

Variable direct costs(2)

     682       137       116       935  

Adjusted fixed costs(3)

     186       84       101       371  

Other segment items(4)

     2       6       (4 )     4  

Total reportable segments’ adjusted EBITDA(5)

   $ 42     $ 30     $ 36       108  
                                 

Reconciliation of total reportable segments’ adjusted EBITDA to income from continuing operations before income taxes:

                                

Interest expense, net—continuing operations

                             (19 )

Depreciation and amortization—continuing operations

                             (69 )

Corporate and other costs, net(6)

                             (34 )

Net income attributable to noncontrolling interests

                             16  

Other adjustments:

                                

Business acquisition and integration gain and purchase accounting inventory adjustments, net

                             5  

Certain legal and other settlements and related income

                             33  

Amortization of pension and postretirement actuarial losses

                             (7 )

Restructuring, impairment and plant closing and transition costs(7)

                             (4 )

Income from continuing operations before income taxes

                             29  
                                 

Income tax expense—continuing operations

                             (17 )

Loss from discontinued operations, net of tax

                             (1 )

Net income

                           $ 11  

 

   

Three months ended March 31, 2024

  
   

Polyurethanes

    

Performance Products

    

Advanced Materials

    

Total

  

Revenues:

                                

Reportable segments’ revenues(1)

   $ 926     $ 291     $ 261     $ 1,478  
                                 

Significant segment expenses:

                                

Variable direct costs(2)

     705       160       122       987  

Adjusted fixed costs(3)

     198       83       98       379  

Other segment items(4)

     (16 )     6       (2 )     (12 )

Total reportable segments’ adjusted EBITDA(5)

   $ 39     $ 42     $ 43       124  
                                 

Reconciliation of total reportable segments’ adjusted EBITDA to loss from continuing operations before income taxes:

                                

Interest expense, net—continuing operations

                             (19 )

Depreciation and amortization—continuing operations

                             (69 )

Corporate and other costs, net(6)

                             (41 )

Net income attributable to noncontrolling interests

                             14  

Other adjustments:

                                

Business acquisition and integration expenses and purchase accounting inventory adjustments, net

                             (20 )

Certain legal and other settlements and related expenses

                             (1 )

Amortization of pension and postretirement actuarial losses

                             (8 )

Restructuring, impairment and plant closing and transition costs(7)

                             (14 )

Loss from continuing operations before income taxes

                             (34 )
                                 

Income tax benefit—continuing operations

                             20  

Loss from discontinued operations, net of tax

                             (7 )

Net loss

                           $ (21 )

 

   

March 31,

    

December 31,

  
   

2025

    

2024

  

Total assets:

                

Polyurethanes

   $ 4,224     $ 4,151  

Performance Products

     1,278       1,214  

Advanced Materials

     1,118       1,097  

Total reportable segments’ total assets

     6,620       6,462  

Corporate and other

     612       652  

Total

   $ 7,232     $ 7,114  

 

    Three months ended
    March 31,
   

2025

    

2024

  

Depreciation and amortization:

                

Polyurethanes

   $ 39     $ 37  

Performance Products

     15       17  

Advanced Materials

     13       13  

Total reportable segments’ depreciation and amortization

     67       67  

Corporate and other

     2       2  

Total

   $ 69     $ 69  

 

    Three months ended
    March 31,
   

2025

    

2024

  

Capital expenditures:

                

Polyurethanes

   $ 17     $ 15  

Performance Products

     14       22  

Advanced Materials

     4       4  

Total reportable segments’ capital expenditures

     35       41  

Corporate and other

     1       1  

Total

   $ 36     $ 42  

 

 

(1)

A reconciliation of total reportable segments’ revenues to total consolidated revenues is provided in “Note 12. Revenue Recognition.”

(2)

Variable direct costs primarily include raw materials, utilities and freight-related costs.

(3)

Adjusted fixed costs primarily include personnel and maintenance costs at our manufacturing facilities, selling, general and administrative expenses and research and development expenses, less depreciation and amortization and certain of the adjustments noted in footnote (5) below.

(4)

Other segment items include other operating and non-operating income and expense items and foreign currency exchange effects, less certain of the adjustments noted in footnote (5) below.

(5)

We use segment adjusted EBITDA as the measure of each segment’s profit or loss. We believe that segment adjusted EBITDA more accurately reflects what our chief operating decision maker, who has been determined to be our Chief Executive Officer, uses to make decisions about resources to be allocated to the segments and assess their financial performance. Segment adjusted EBITDA is defined as net income of Huntsman Corporation or Huntsman International, as appropriate, before interest, income tax, depreciation and amortization, net income attributable to noncontrolling interests and certain Corporate and other items, as well as eliminating the following adjustments: (a) business acquisition and integration gain (expenses) and purchase accounting inventory adjustments, net; (b) certain legal and other settlements and related income (expenses); (c) amortization of pension and postretirement actuarial losses; (d) restructuring, impairment, plant closing and transition costs; and (e) loss from discontinued operations, net of tax

(6)

Corporate and other costs, net includes unallocated corporate overhead, unallocated foreign exchange gains and losses, LIFO inventory valuation reserve adjustments, nonoperating income and expense and gains and losses on the disposition of corporate assets.

(7)

Includes costs associated with transition activities relating primarily to our program to realign our cost structure in Europe and our Corporate program to optimize our global approach to managed services in various information technology functions.