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Huntsman Posts Stable 2008 Third Quarter Results

Please Click here for the PDF version of this release. EXCLUDING IMPACT OF HURRICANES, ADJUSTED EBITDA EQUALS 2007 THIRD QUARTER THE WOODLANDS, Texas, Nov. 6 /PRNewswire-FirstCall/ -- Huntsman Corporation (NYSE: HUN) Third Quarter 2008 Highlights

Third Quarter 2008 Highlights

-- Revenues for the third quarter of 2008 were $2,730.5 million, an increase of 13% compared to $2,423.8 million for the third quarter of 2007 and a decrease of 6% compared to $2,895.7 million for the second quarter of 2008.

-- We estimate that we incurred $49 million of costs and lost profit margin as a result of hurricanes during the third quarter of 2008 ($21 million of costs and $28 million of lost profit margin). This had the effect of decreasing our third quarter 2008 adjusted EBITDA and adjusted net loss by approximately $49 million and $32 million ($0.14 per diluted share), respectively.

-- Net loss for the third quarter of 2008 was $20.2 million or $0.09 per diluted share compared to a net loss of $150.0 million or $0.68 loss per diluted share for the same period in 2007 and compared to net income of $23.7 million or $0.10 per diluted share for the second quarter of 2008. Adjusted net loss from continuing operations for the third quarter of 2008 was $1.9 million or $0.01 per diluted share compared to adjusted net income of $80.0 million or $0.34 per diluted share for the same period in 2007 and $19.9 million or $0.09 per diluted share for the second quarter of 2008.

-- Adjusted EBITDA from continuing operations for the third quarter of 2008 was $193.9 million (and would have been approximately $242.9 without the hurricane impact) compared to $240.2 million for the same period in 2007 and compared to $209.8 million for the second quarter of 2008.

    Summarized earnings are as follows:



                                       Three months  Three months Nine months
                                          ended        ended        ended
                                       September 30,  June 30,   September 30,
    In millions, except per share      2008    2007     2008    2008     2007
    amounts

    Net (loss) income                $(20.2) $(150.0)  $23.7   $10.8  $(174.3)
    Adjusted net (loss) income from
     continuing operations            $(1.9)   $80.0   $19.9   $34.9   $221.2

    Diluted (loss) income per share  $(0.09)  $(0.68)  $0.10   $0.05   $(0.79)
    Adjusted diluted (loss) income
     per share from continuing
     operations                      $(0.01)   $0.34   $0.09   $0.15    $0.95

    EBITDA                           $165.0     $7.9  $210.2  $544.7   $272.5
    Adjusted EBITDA from continuing
     operations                      $193.9   $240.2  $209.8  $592.0   $731.1

    See end of press release for important explanations


-- On the evening of October 27, 2008, hours before the planned closing of the merger the following morning, counsel to Credit Suisse and Deutsche Bank (the "Banks"), lenders that had previously committed to Hexion to loan the funds to consummate the merger, notified Hexion that it was not prepared to fund the closing of the merger, citing concerns that the solvency opinion and certificate proposed to be provided did not meet the condition of the commitment letter. As such, the merger did not close as scheduled. On October 29, 2008, Hexion sued the Banks in New York state court seeking specific performance of the Banks' obligations under the commitment letter. A trial has been set for January 8, 2009.

-- On October 13, 2008, a Texas court imposed a temporary injunction on Credit Suisse and Deutsche Bank who had earlier committed to finance the merger of Huntsman Corporation and Hexion Specialty Chemicals, Inc. This ruling was subsequently upheld by the Court of Appeals. The court has set a trial date of February 9, 2008.

-- On October 6, 2008, we announced that in order to comply with the annual meeting requirements of the New York Stock Exchange we are taking steps to hold an annual meeting on November 19, 2008. Proxy materials have been mailed to stockholders.

-- On September 29, 2008, the Delaware Court of Chancery ruled in favor of Huntsman Corporation denying Apollo Management, L.P. and Hexion Specialty Chemicals, Inc.'s request for declaratory relief that Hexion was excused from consummating the pending merger. The court ordered Hexion to perform its covenants and found Hexion in knowing and intentional breach of the Merger Agreement, meaning that potential damages against them would be uncapped.

Peter R. Huntsman, our President and CEO, stated:

"I am pleased with our third quarter results. Excluding the approximately $49 million impact of Hurricanes Gustav and Ike, our Adjusted EBITDA was in line with prior year results and significantly greater than the previous quarter. Our swift and sustained efforts begun earlier this year to increase selling prices have proven effective and are reflected in this quarter's results, as each of our divisions realized currency adjusted increases in their average selling prices.

"During the quarter we continued to see significant headwinds in the form of high raw material and energy costs measured on a sequential and year-over- year basis. We note however that crude oil and natural gas prices have retreated and we are optimistic that this relief will work its way through the value chain and into our costs in the coming months."



                             Huntsman Corporation
                              Operating Results


                                 Three months ended    Nine months ended
    In millions, except per          September 30,       September 30,
     share amounts                  2008       2007      2008      2007

    Revenues                       $2,730.5  $2,423.8  $8,166.6  $7,146.9
    Cost of goods sold              2,379.7   2,023.1   7,067.4   5,967.6
    Gross profit                      350.8     400.7   1,099.2   1,179.3
    Operating expenses                254.3     259.5     806.8     762.6
    Restructuring, impairment
     and plant closing costs            3.6       9.1       8.6      33.5
    Operating income                   92.9     132.1     283.8     383.2
    Interest expense, net             (68.2)    (71.5)   (198.5)   (215.3)
    Loss on accounts receivable
     securitization program            (6.2)     (7.1)    (15.7)    (16.0)
    Equity in income of investment
     in unconsolidated affiliates       2.9       1.6       9.6       8.9
    Expenses associated with the
     Merger                           (25.8)   (205.0)    (34.8)   (205.0)
    Other non-operating expense           -      (2.4)      0.7      (4.5)
    (Loss) income from continuing
     operations before income taxes
     and minority interest             (4.4)   (152.3)     45.1     (48.7)
    Income tax (expense) benefit      (17.7)     13.1     (42.3)      8.7
    Minority interest in
     subsidiaries' income              (0.5)      2.9      (7.0)     13.6
    (Loss) income from continuing
     operations                       (22.6)   (136.3)     (4.2)    (26.4)
    Income (loss) from discontinued
     operations, net of tax(1)          0.8     (13.7)      4.6    (141.4)
    Extraordinary gain on the
     acquisition of a business,
     net of tax(2)                      1.6         -      10.4      (6.5)
    Net (loss) income                $(20.2)  $(150.0)    $10.8   $(174.3)

    Net (loss) income                $(20.2)  $(150.0)    $10.8   $(174.3)
    Interest expense, net              68.2      71.5     198.5     215.3
    Income tax expense (benefit)       17.7     (13.1)     42.3      (8.7)
    Depreciation and amortization      98.8      93.0     290.1     281.9
    Income taxes, depreciation and
     amortization included in
     discontinued operations(1,3)       0.5       6.5       3.0     (41.7)
    EBITDA(3)                        $165.0      $7.9    $544.7    $272.5

    Adjusted EBITDA - continuing
     operations(3)                   $193.9    $240.2    $592.0    $731.1

    Basic (loss) income per share    $(0.09)   $(0.68)    $0.05    $(0.79)
    Diluted (loss) income per
     share                           $(0.09)   $(0.68)    $0.05    $(0.79)
    Adjusted diluted (loss)
     income per share from
     continuing operations(3)        $(0.01)    $0.34     $0.15     $0.95

    Common share information:
      Basic shares outstanding        233.6     221.0     231.4     220.9
      Diluted shares                  233.6     221.0     231.4     220.9
      Diluted shares for adjusted
       diluted income per share
       from continuing operations     233.6     232.9     233.6     232.2

    See end of press release for footnote explanations



                             Huntsman Corporation
                               Segment Results

                                        Three months ended  Nine months ended
                                           September 30,       September 30,
    In millions                           2008      2007      2008      2007

    Segment Revenues:
      Polyurethanes                    $1,096.0    $974.4  $3,258.6  $2,824.6
      Materials and Effects               614.0     594.9   1,925.2   1,806.0
      Performance Products                740.7     590.2   2,097.1   1,690.5
      Pigments                            279.8     271.1     885.7     834.5
      Eliminations and other                  -      (6.8)        -      (8.7)
        Total from continuing
         operations                     2,730.5   2,423.8   8,166.6   7,146.9
      Discontinued operations (1)             -     190.6         -   1,018.0

        Total                          $2,730.5  $2,614.4  $8,166.6  $8,164.9

    Segment EBITDA(3):
      Polyurethanes                       $89.3    $172.8    $368.8    $449.7
      Materials and Effects                46.2      48.6     135.3     158.2
      Performance Products                 81.0      48.0     184.5     153.3
      Pigments                             15.2      (0.4)     32.9      45.0
      Corporate and other                 (68.0)   (258.7)   (184.4)   (358.9)
      Discontinued operations (1)           1.3      (2.4)      7.6    (174.8)
        Total                            $165.0      $7.9    $544.7    $272.5

    Segment Adjusted EBITDA(3):
      Polyurethanes                       $89.3    $172.8    $368.8    $450.7
      Materials and Effects                47.7      52.8     138.2     176.8
      Performance Products                 81.0      47.9     184.6     159.9
      Pigments                             15.6       3.7      34.2      47.6
      Corporate and other                 (39.7)    (37.0)   (133.8)   (103.9)
        Total from continuing operations  193.9     240.2     592.0     731.1
      Discontinued operations (1)             -     (14.1)        -      23.4
        Total                            $193.9    $226.1    $592.0    $754.5


                                          Three months ended Nine months ended
                                              September 30,     September 30,
                                              2008 vs. 2007     2008 vs. 2007
                                            Average           Average
                                            Selling   Sales   Selling   Sales
     Period-Over-Period Increase (Decrease) Price     Volume   Price    Volume

      Polyurethanes (a)                       8%        4%       11%        4%
      Materials and Effects                  13%      (9)%       12%      (5)%
      Performance Products (a)               34%      (8)%       32%      (7)%
      Pigments                               17%     (12)%       10%      (4)%

      (a) Excludes revenues and sales volumes from tolling arrangements.

      See end of press release for footnote explanations


Three Months Ended September 30, 2008 as Compared to Three Months Ended September 30, 2007

Revenues from continuing operations for the three months ended September 30, 2008 increased to $2,730.5 million from $2,423.8 million during the same period in 2007. Revenues increased in all of our segments primarily due to higher average selling prices, while sales volumes were higher in Polyurethanes.

For the three months ended September 30, 2008, EBITDA was $165.0 million as compared to $7.9 million in the same period in 2007. Adjusted EBITDA from continuing operations for the three months ended September 30, 2008 was $193.9 million (including the negative affect of approximately $49 million of costs and lost profit margins) as compared to $240.2 million for the same period in 2007.

Polyurethanes

The increase in revenues in the Polyurethanes segment for the three months ended September 30, 2008 compared to the same period in 2007 was due to higher average selling prices and higher sales volumes. MDI average selling prices increased 6% primarily due to global price increase initiatives and in Europe primarily due to the strength of foreign currencies versus the U.S. dollar. MDI sales volumes decreased 2%, as growth in Europe was strong but more than offset by lower volumes in the U.S. due to Hurricanes Gustav and Ike and lower volumes in Asia following government imposed restrictions in China. PO and co-product MTBE average selling prices increased primarily due to improved market demand and higher raw material costs, while sales volumes decreased due to the effect of Hurricanes Gustav and Ike.

The decrease in EBITDA in the Polyurethanes segment was primarily the result of the impact of Hurricanes Gustav and Ike, higher raw material costs and energy costs. In urethanes, higher MDI selling prices were more than offset by higher costs for raw materials such as benzene, natural gas, propylene, ammonia and caustic soda as well as increased fixed manufacturing and selling, general and administrative costs due primarily to the strength of the Euro versus the U.S. dollar. PO and co-product MTBE margins decreased primarily due to the impact of Hurricanes Gustav and Ike, which more than offset higher average selling prices. We estimate the financial impact including unabsorbed costs, repairs and lost profit margin of Hurricanes Gustav and Ike to be approximately $39 million in the third quarter of 2008 in our Polyurethanes division.

Materials and Effects

The increase in revenues in the Materials and Effects segment for the three months ended September 30, 2008 compared to the same period in 2007 was primarily due to higher average selling prices. Average selling prices increased by 13% as average selling prices increased in both advanced materials and textile effects due to the strength of major European currencies versus the U.S. dollar and price increase initiatives in certain markets and regions. Total sales volumes decreased 9%, advanced materials sales volumes decreased by 4% primarily as a result of lower demand in Europe, textile effects sales volumes decreased by 18% primarily as the result of lower demand for dyes and chemicals in all regions. The advanced materials business contributed $385.4 million in revenues for the three months ended September 30, 2008, while the textile effects business contributed $228.6 million in revenues for the same period.

The decrease in EBITDA in the Materials and Effects segment was primarily due to higher raw material costs and energy costs. In addition, fixed costs and selling, general and administrative costs for textile effects were higher, primarily due to the strength of the Euro and Swiss franc relative to the U.S. dollar. The advanced materials business contributed $41.7 million of EBITDA for the three months ended September 30, 2008, while the textile effects business contributed $4.5 million. During the three months ended September 30, 2008 the Materials and Effects segment recorded restructuring, impairment and plant closing costs of $1.5 million in textile effects compared to $4.2 million for the same period in 2007.

Performance Products

The increase in revenues in the Performance Products segment for the three months ended September 30, 2008 compared to the same period in 2007 was primarily due to a 34% increase in average selling prices. Average selling prices increased from price increase initiatives in response to higher raw material costs and the strength of major European and Australian currencies against the U.S. dollar. Sales volumes (excluding tolling), decreased 8% primarily due to the conversion of most of our ethylene glycol business to a toll manufacturing operation in 2008 and lower surfactant sales that more than offset volume increases in other products. Toll manufacturing volumes were higher in the 2008 period.

The increase in EBITDA in the Performance Products segment was primarily due to higher average selling prices which were partially offset by higher raw material and energy costs. Higher margins were partially offset by higher fixed production costs and selling, general and administrative costs due in part to the strength of major European and Australian currencies against the U.S. dollar. We estimate the financial impact including unabsorbed costs, repairs and lost profit margin of hurricanes Gustav and Ike at approximately $9 million in the third quarter of 2008 in our Performance Products division.

Pigments

The increase in revenues in the Pigments segment for the three months ended September 30, 2008 compared to the same period in 2007 was primarily due to a 17% increase in average selling prices partially offset by a decrease in volumes. Average selling prices increased primarily due to price increase initiatives and the strength of the Euro versus the U.S. dollar, local currency selling prices were higher in all regions of the world. Volumes decreased primarily due to lower demand in Europe.

The increase in EBITDA in the Pigments segment was primarily due to the higher local currency selling prices discussed above, partially offset by higher raw material energy and freight costs. In addition, indirect costs and selling, general and administrative costs were lower due to ongoing cost savings initiatives offset by the foreign currency translation effect of a stronger Euro versus the U.S. dollar. We estimate the financial impact including unabsorbed costs, repairs and lost profit margin of Hurricanes Gustav and Ike at approximately $1 million in the third quarter of 2008 in our Pigments division.

Discontinued Operations

On November 5, 2007, we completed the sale of the assets that comprise our U.S. base chemicals business to Flint Hills Resources. On August 1, 2007, we completed the sale of the majority of the assets that comprise our Polymers segment to Flint Hills Resources. Results from these businesses have been classified as discontinued operations.

Corporate and Other

Corporate and other items include the results of our Australia styrenics business, unallocated foreign exchange gains and losses, unallocated corporate overhead, loss on the sale of accounts receivable, losses on the early extinguishment of debt, merger associated expenses, minority interest, unallocated restructuring costs, gain and loss on the disposition of assets, the extraordinary gain on the acquisition of a business and other non- operating income and expense. In the third quarter of 2008, the total of these items was a loss of $68.0 million compared to a loss of $258.7 million in the 2007 period. The increase in EBITDA from these items was primarily the result of $179.2 million decrease in expenses associated with the pending Hexion merger ($25.8 million recorded in the 2008 period compared to $205.0 million in the 2007 period), $7.7 million of unallocated foreign exchange gains ($3.8 million in gains for the 2008 period compared to losses of $3.9 million during 2007) and a $4.8 million loss on the accounts receivable securitization program for discontinued operations recorded in 2007. These increases to EBITDA were partially offset by $3.4 million of lower minority interest in subsidiaries' income.

Income Taxes

During the three months ended September 30, 2008, we recorded $17.7 million of income tax expense compared to $13.1 million of income tax benefit in the comparable period of 2007. We experienced higher effective taxes in the 2008 period compared to 2007 due primarily to higher losses related to our Textile Effects and Pigments businesses in certain European jurisdictions, where we were unable to record a tax benefit.

Liquidity, Capital Resources and Outstanding Debt

As of September 30, 2008, we had approximately $536 million in cash and unused borrowing capacity compared with approximately $579 million for the most recent quarter ended June 30, 2008. During the three months ended September 30, 2008, net debt plus outstandings under our off-balance sheet accounts receivable securitization program decreased approximately $46 million, primarily due to the foreign currency translation impact on Euro denominated debt resulting from the decline in the Euro versus the U.S. dollar. Outstandings under our off-balance sheet securitization program as of September 30, 2008 were $422 million compared to $503 million as of June 30, 2008, primarily due to a reduction in accounts receivable sold into the program largely resulting from the impact of Hurricanes Gustav and Ike on our sales during the quarter.

For the three months ended September 30, 2008, total capital expenditures were approximately $101 million compared to approximately $184 million for the same period in 2007. The $83 million reduction in capital expenditures is primarily due to the rebuild of the fire damaged Port Arthur, Texas olefins facility, which was ongoing during the three months ended September 30, 2007 and which was subsequently sold in the fourth quarter of 2007 to Flint Hills Resources.

    Below is our outstanding debt:



                                    September 30,  June 30,  December 31,
    In millions                          2008        2008        2007

    Debt:
      Senior Credit Facilities         $1,893.7    $1,863.4    $1,540.0
      Secured Notes                       294.8       294.6       294.4
      Senior Notes                        198.0       198.0       198.0
      Subordinated Notes                1,308.6     1,368.9     1,310.5
      Other Debt                          262.9       228.6       225.9
      Total Debt                        3,958.0     3,953.5     3,568.8

    Total Cash                            113.1       144.1       154.0

    Net Debt                           $3,844.9    $3,809.4    $3,414.8

    Off-balance sheet accounts
     receivable securitization program   $422.0      $503.0      $427.5



                             Huntsman Corporation
                        Reconciliation of Adjustments

                                            Net Income
                                         (Loss) Available    Diluted Income
                                            To Common            (Loss)
                             EBITDA        Stockholders         Per Share
                          Three months     Three months       Three months
                             ended            ended              ended
    In millions, except  September 30,     September 30,      September 30,
    per share amounts     2008    2007    2008      2007      2008      2007

    GAAP                 $165.0   $7.9  $(20.2)   $(150.0)  $(0.09)   $(0.68)
    Adjustments:
      Loss on accounts
       receivable
       securitization
       program              6.2    7.1       -          -        -        -
      Unallocated foreign
       currency (gain)
       loss                (3.8)   3.9    (7.8)       2.6    (0.03)    0.01
      Other
       restructuring,
       impairment and
       plant closing costs  3.6    9.1     2.7        8.7     0.01     0.04
      Merger associated
       expenses            25.8  205.0    25.8      205.0     0.11     0.88
      (Income) loss from
       discontinued
       operations, net
       of tax(1)           (1.3)   7.2    (0.8)      13.7        -     0.06
      Extraordinary gain
       on the acquisition
       of a business,
       net of tax(2)       (1.6)     -    (1.6)         -    (0.01)       -


    Adjusted continuing
      operations         $193.9 $240.2   $(1.9)     $80.0   $(0.01)   $0.34

    Discontinued
     operations            $1.3  $(7.2)   $0.8     $(13.7)      $-   $(0.06)
      Restructuring,
       impairment and
       plant closing costs    -    1.1       -        0.3        -        -
      (Gain) on disposition
       of assets           (1.3) (12.8)   (0.8)      (8.8)       -    (0.04)
      Loss on accounts
       receivable
       securitization
       program                -    4.8       -          -        -        -

    Adjusted discontinued
     operations(1)           $- $(14.1)     $-     $(22.2)       $-  $(0.10)


                  Three months ended June 30,
    In millions            2008

    Net income            $23.7
    Interest expense, net  65.5
    Income tax expense     21.2
    Depreciation and
     amortization          97.5
    Income taxes,
     depreciation and
     amortization
     included in
     discontinued
     operations(1,3)       2.3
    EBITDA(3)           $210.2



    In millions, except per share amounts
                                       Net Income
                                   (Loss) Available
                                       To Common     Diluted Income (Loss)
                                      Stockholders         Per Share
                        EBITDA        Three months        Three months
                  Three months ended     ended                ended
                       June 30,         June 30,             June 30,
                         2008             2008                 2008

    GAAP                $210.2           $23.7                $0.10
    Adjustments:
      Loss on accounts
       receivable
       securitization
       program             4.9               -                    -
      Unallocated foreign
       currency loss       5.5             4.4                 0.02
      Other restructuring,
       impairment and
       plant closing costs 1.0             1.3                 0.01
      Merger associated
       expenses            3.8             3.8                 0.02
      Income from
       discontinued
       operations, net
       of tax(1)          (7.2)           (4.9)               (0.02)
      Extraordinary gain
       on the acquisition
       of a business, net
       of tax(2)          (8.4)           (8.4)               (0.04)

     Adjusted continuing
      operations        $209.8           $19.9                $0.09


    In millions, except per share amounts
                                           Net Income
                                        (Loss) Available
                                           To Common     Diluted Income (Loss)
                           EBITDA         Stockholders          Per Share
                         Nine months       Nine months         Nine months
                            ended             ended               ended
                         September 30,     September 30,       September 30,
                         2008    2007     2008       2007      2008    2007

    GAAP                $544.7  $272.5   $10.8    $(174.3)    $0.05  $(0.79)
    Adjustments:
      Loss on accounts
       receivable
       securitization
       program            15.7    16.0       -          -         -
      Unallocated
       foreign
       currency (gain)
       loss                6.2    10.5    (3.0)       7.9     (0.01)   0.03
      Legal and contract
       settlements           -     6.3       -        4.4         -    0.02
      Loss on early
       extinguishment
       of debt               -     1.8       -        1.1         -    0.00
      Other restructuring,
       impairment and
       plant closing
       costs               8.6    33.5     7.3       33.3      0.03    0.14
      Merger associated
       expenses           34.8   205.0    34.8      205.0      0.15    0.88
      Gain on
       dispositions of
       assets                -    (4.1)      -       (4.1)        -   (0.02)
      (Income) loss
       from discontinued
       operations, net
       of tax(1)          (7.6)  183.1    (4.6)     141.4     (0.02)   0.61
      Extraordinary
       (gain) loss on
       the acquisition
       of a business,
       net of tax(2)     (10.4)    6.5   (10.4)       6.5     (0.04)   0.03

     Adjusted
      continuing
      operations        $592.0  $731.1   $34.9     $221.2     $0.15   $0.95

    Discontinued
     operations           $7.6 $(183.1)   $4.6    $(141.4)    $0.02  $(0.61)
      Restructuring,
       impairment and
       plant closing
       costs                 -     2.2       -        1.4         -    0.01
      (Gain) loss on
       disposition of
       assets             (7.6)  197.0    (4.6)     120.1     (0.02)   0.52
      Loss on accounts
       receivable
       securitization
       program               -     7.3       -          -         -       -


    Adjusted discontinued
     operations(1)          $-   $23.4      $-     $(19.9)       $-  $(0.09)

    See end of press release for footnote explanations


Conference Call Information

We will hold a conference call to discuss our third quarter 2008 financial results on Thursday, November 6, 2008 at 11:00 a.m. ET. Third quarter 2008 results will be released to the public prior to the market opening that day via PR Newswire.

    Call-in number for U.S. participants:             (888) 713 - 4214
    Call-in number for international participants:    (617) 213 - 4866
    Participant access code:                           51604516

In order to facilitate the registration process, you may use the following link to pre-register for the conference call. Callers who pre-register will be given a unique PIN to gain immediate access to the call and bypass the live operator. You may pre-register at any time, including up to and after the call start time. To pre-register, please go to: https://www.theconferencingservice.com/prereg/key.process?key=P73EPHEFM

The conference call will be available via webcast and can be accessed from the investor relations portion of the company's website at http://www.huntsman.com.

The conference call will be available for replay beginning November 6, 2008 and ending November 13, 2008.

    Call-in numbers for the replay:
      Within the U.S.:       (888) 286 - 8010
      International:         (617) 801 - 6888
    Access code for replay:  83791974

Forward Looking Statements:

Statements in this release that are not historical are forward-looking statements. These statements are based on management's current beliefs and expectations. The forward-looking statements in this release are subject to uncertainty and changes in circumstances and involve risks and uncertainties that may affect the company's operations, markets, products, services, prices and other factors as discussed in the Huntsman companies' filings with the U.S. Securities and Exchange Commission. Significant risks and uncertainties may relate to, but are not limited to, financial, economic, competitive, environmental, political, legal, regulatory and technological factors. In addition, the completion of any transaction described in this release is subject to a number of uncertainties and closing will be subject to approvals and other customary conditions. Accordingly, there can be no assurance that such transactions will be completed or that the company's expectations will be realized. The company assumes no obligation to provide revisions to any forward-looking statements should circumstances change, except as otherwise required by applicable laws.

Additional Information and Where to Find It:

In connection with the proposed merger, the Company has filed a definitive proxy statement with the Securities and Exchange Commission (the "SEC"), which definitive proxy statement has been mailed to its stockholders. INVESTORS AND SECURITY HOLDERS ARE ADVISED TO READ THE DEFINITIVE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS THEY CONTAIN IMPORTANT INFORMATION ABOUT THE MERGER AND THE PARTIES TO THE MERGER. Investors and security holders may obtain a free copy of the definitive proxy statement and other relevant documents filed with the SEC from the SEC's website at http://www.sec.gov. The Company's security holders and other interested parties will also be able to obtain, without charge, a copy of the proxy statement and other relevant documents by directing a request by mail or telephone to Huntsman Corporation Investor Relations, 500 Huntsman Way, Salt Lake City, Utah 84108, telephone: (801) 584-5700 or on the company's website at http://www.huntsman.com.

(1) On November 5, 2007, we completed the sale of our U.S. base chemicals business to Flint Hills Resources. On August 1, 2007, we completed the sale of our U.S. polymers business to Flint Hills Resources. On December 29, 2006, we completed the sale of our European petrochemicals business to SABIC. On July 6, 2005, we completed the sale of our toluene di-isocyanate (TDI) business to BASF. Results from these businesses are treated as discontinued operations.

(2) On June 30, 2006, we acquired the global textile effects business of Ciba Specialty Chemicals Inc. for approximately $172.1 million. Because the fair value of acquired current assets less liabilities assumed exceeded the acquisition price and planned restructuring costs the excess was recorded as an extraordinary gain on the acquisition of a business. The extraordinary amounts recorded during the three months ended September 30, 2008 and 2007 respectively were $1.6 million gain and nil, of which taxes were not applicable.

(3) We use EBITDA, Adjusted EBITDA from continuing operations, Adjusted EBITDA from discontinued operations, Adjusted net income from continuing operations and Adjusted net income from discontinued operations. We believe that net income (loss) available to common stockholders is the performance measure calculated and presented in accordance with generally accepted accounting principles in the U.S. ("GAAP") that is most directly comparable to EBITDA, Adjusted EBITDA from continuing operations and Adjusted net income from continuing operations. We believe that income (loss) from discontinued operations is the performance measure calculated and presented in accordance with GAAP that is most directly comparable to Adjusted EBITDA from discontinued operations and Adjusted net income from discontinued operations. Additional information with respect to our use of each of these financial measures follows.

EBITDA is defined as net income before interest, income taxes, and depreciation and amortization. EBITDA as used herein is not necessarily comparable to other similarly titled measures of other companies. The reconciliation of EBITDA to net income (loss) available to common stockholders is set forth in the operating results table above.

Adjusted EBITDA from continuing operations is computed by eliminating the following from EBITDA: gains and losses from discontinued operations; restructuring, impairment and plant closing (credits) costs; merger associated expenses; losses on the sale of accounts receivable to our securitization program; unallocated foreign currency (gain) loss; certain legal and contract settlements; losses from early extinguishment of debt; extraordinary loss (gain) on the acquisition of a business; and loss (gain) on dispositions of assets. The reconciliation of Adjusted EBITDA from continuing operations to EBITDA is set forth in the Reconciliation of Adjustments table above.

Adjusted EBITDA from discontinued operations is computed by eliminating from income (loss) from discontinued operations: income taxes; depreciation and amortization; restructuring, impairment and plant closing (credits) costs; losses on the sale of accounts receivable to our securitization program; unallocated foreign currency (gain) loss; and loss on the sale of assets. The following table provides a reconciliation of Adjusted EBITDA from discontinued operations to income (loss) from discontinued operations:



                                        Three months ended   Nine months ended
                                            September 30,      September 30,
                                            2008     2007      2008     2007

    Income (loss) from discontinued
     operations, net of tax                 $0.8    $(13.7)   $4.6    $(141.4)
      Income tax expense (benefit)           0.5       3.2     3.0      (73.1)
      Depreciation and amortization            -       3.3       -       31.4
    EBITDA from discontinued operations      1.3      (7.2)   $7.6    $(183.1)
      Restructuring, impairment and plant
       closing costs                           -       1.1       -        2.2
      (Gain) loss on disposition of assets  (1.3)    (12.8)   (7.6)     197.0
      Loss on accounts receivable
       securitization                          -       4.8       -        7.3
    Adjusted EBITDA from discontinued
     operations                               $-    $(14.1)     $-      $23.4


Adjusted net income from continuing operations is computed by eliminating the after tax impact of the following from net income (loss) available to common stockholders: loss (income) from discontinued operations; restructuring, impairment and plant closing (credits) costs; merger associated expenses; unallocated foreign currency (gain) loss; certain legal and contract settlements; losses on the early extinguishment of debt; extraordinary loss (gain) on the acquisition of a business; and loss (gain) on dispositions of assets. The reconciliation of Adjusted net income from continuing operations to net income (loss) available to common stockholders is set forth in the Reconciliation of Adjustments table above.

Adjusted net income from discontinued operations is computed by eliminating the after tax impact of the following from income (loss) from discontinued operations: restructuring, impairment and plant closing (credits) costs; and loss on the sale of assets. The reconciliation of Adjusted net income from discontinued operations to net income (loss) available to common stockholders is set forth in the Reconciliation of Adjustments table above.

SOURCE  Huntsman Corporation
    -0-                             11/06/2008
    /CONTACT:  Media, Russ Stolle, +1-281-719-6624, or Investor Relations,
Kurt Ogden, +1-801-584-5959, both of Huntsman Corporation/
    /Web site:  http://www.huntsman.com /
    (HUN)

CO:  Huntsman Corporation
ST:  Texas
IN:  CHM
SU:  ERN CCA ERP

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