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Huntsman Releases 2008 Fourth Quarter and Full Year Results

Please Click here for the PDF version of this release. FOURTH QUARTER NET INCOME OF $598 MILLION, AVAILABLE LIQUIDITY of $1.3 Billion

 

    THE WOODLANDS, Texas, Feb. 26 /PRNewswire-FirstCall/ --

    Fourth Quarter 2008 Highlights

    --  Revenues for the fourth quarter of 2008 were $2,048 million, a
        decrease of 18% compared to $2,504 million for the fourth quarter of
        2007 and a decrease of 25% compared to $2,731 million for the third
        quarter of 2008.
    --  Net income for the fourth quarter of 2008 was $598 million or $2.53
        per diluted share compared to net income of $2 million or $0.01 per
        diluted share for the same period in 2007 and compared to net loss of
        $20 million or $0.09 loss per diluted share for the third quarter of
        2008.  Adjusted net loss from continuing operations for the fourth
        quarter of 2008 was $91 million or $0.38 loss per diluted share
        compared to adjusted net income from continuing operations of $51
        million or $0.22 per diluted share for the same period in 2007 and
        adjusted net loss from continuing operations of $2 million or $0.01
        loss per diluted share for the third quarter of 2008.
    --  Adjusted EBITDA from continuing operations for the fourth quarter of
        2008 was $51 million compared to $195 million for the same period in
        2007 and compared to $194 million for the third quarter of 2008.

    2008 Highlights

    --  Revenues for 2008 were $10,215 million, an increase of 6% compared to
        $9,651 million for 2007.
    --  Net income for 2008 was $609 million or $2.60 per diluted share
        compared to net loss of $172 million or $0.74 loss per diluted share
        for 2007.  Adjusted net loss from continuing operations for 2008 was
        $57 million or $0.24 loss per diluted share compared to adjusted net
        income from continuing operations of $271 million or $1.16 per diluted
        share for 2007.
    --  Adjusted EBITDA from continuing operations for 2008 was $643 million
        compared to $926 million for 2007.


    Summarized earnings are as follows:




                                Three
                                months          Three
                                ended           months
                               December         ended      Year ended
                                  31,           -----      December 31,
    In millions, except per   ---------       September   -------------
     share amounts            2008   2007     30, 2008    2008    2007
    -----------------------   ----   ----    ----------   ----    ----

    Net income (loss)         $598     $2      $(20)     $609     $(172)
    Adjusted net (loss)
     income from
     continuing operations    $(91)   $51       $(2)     $(57)     $271

    Diluted income
     (loss) per share        $2.53  $0.01    $(0.09)    $2.60    $(0.74)
    Adjusted diluted
     (loss) income per
     share from
     continuing operations  $(0.38) $0.22    $(0.01)   $(0.24)    $1.16

    EBITDA                    $984   $102      $165    $1,529      $375
    Adjusted EBITDA from
     continuing operations     $51   $195      $194      $643      $926

    See end of press release for important explanations
    --  On December 14, 2008, we announced that the merger agreement with
        Hexion Specialty Chemicals, Inc. was terminated.  We reached a
        settlement agreement with Hexion, Apollo Management, L.P. and certain
        of its affiliates to settle our claims against them associated with
        the merger for $1 billion.  Subsequently, we received the full $1
        billion in cash before December 31, 2008, as follows: Hexion paid us a
        termination fee of $325 million and Apollo affiliates paid us $425
        million and purchased $250 million of our 7% convertible senior notes.
        We continue to pursue our multi-billion dollar tortious interference
        claims against Credit Suisse and Deutsche Bank.  The court in
        Montgomery County, Texas has ordered mediation to begin on May 11,
        2009 and trial, if necessary, to commence on June 8, 2009.
    --  On January 22, 2009, we announced a company-wide initiative to reduce
        costs across all divisions and functions.  Including steps begun in
        the fourth quarter 2008, we intend to reduce our full-time employment
        by approximately 1,250 positions - nearly 10% of all employees.  In
        addition, full-time contractor positions will be reduced by 490.
        Annualized operating cost savings from all cuts are estimated to be
        $150 million.
    --  On February 9, 2009, we announced that our board of directors decided
        to continue our dividend during the first quarter of 2009.  Our board
        declared a $0.10 per share cash dividend payable on March 31, 2009, to
        stockholders of record as of March 16, 2009.


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

"The fourth quarter of 2008 was perhaps the most challenging in the history of our industry and we acted swiftly to assure our long term prosperity. We negotiated one of the largest out of court settlements and collected $1 billion from Hexion and Apollo to settle our ongoing litigation against them and we continue to pursue a multi-billion dollar lawsuit against Credit Suisse and Deutsche Bank. We recently announced the closure of our Grimsby, UK TiO2 facility while at the same time temporarily suspending operations in a number of our other facilities to effectively manage the drop in demand we experienced during the quarter. We also announced the elimination of 1,250 positions, nearly 10% of our work force, whereby we expect to save approximately $150 million."


    Mr. Huntsman continued, "All of our business divisions have seen an
increase in demand since December 2008.  With strong liquidity, lower costs
and unfettered control of our business, we believe that we are in a unique
position to focus on our business and prosper during these challenging global
conditions."



                                  Huntsman Corporation
                                   Operating Results

                                        Three months           Year ended
    In millions, except per          ended December 31,       December 31,
     share amounts                      2008    2007          2008    2007
    --------------                      ----    ----          ----    ----
    Revenues                          $2,048  $2,504       $10,215  $9,651
    Cost of goods sold                 1,883   2,143         8,951   8,111
                                       -----   -----         -----   -----
    Gross profit                         165     361         1,264   1,540
    Operating expenses                   256     199         1,063     961
    Restructuring, impairment and
     plant closing costs                  28       8            36      42
                                          --       -            --      --
    Operating (loss) income             (119)    154           165     537
    Interest expense, net                (64)    (71)         (263)   (286)
    Loss on accounts receivable
     securitization program              (11)     (5)          (27)    (21)
    Equity in income of investment
     in unconsolidated affiliates          4       4            14      13
    Income (expenses) associated
     with the Merger                     815      (5)          780    (210)
    Other non-operating (expense) income  (1)      3             -      (2)
                                          --       -             -      --
    Income from continuing operations
     before income taxes and minority
     interest                            624      80           669      31
    Income tax (expense) benefit        (148)      3          (190)     12
    Minority interest in subsidiaries'
     loss (income)                         6      (4)           (1)      9
                                           -      --            --       -
    Income from continuing operations    482      79           478      52
    Income (loss) from discontinued
     operations, net of tax(1)           112     (76)          117    (217)
    Extraordinary gain (loss) on the
     acquisition of a business,
     net of tax(2)                         4      (1)           14      (7)
                                           -      --            --      --
    Net income (loss)                   $598      $2          $609   $(172)
                                        ====      ==          ====   =====

    Net income (loss)                   $598      $2          $609   $(172)
    Interest expense, net                 64      71           263     286
    Income tax expense (benefit)         148      (3)          190     (12)
    Depreciation and amortization        108      97           398     380
    Income taxes, depreciation and
     amortization included in
     discontinued operations(1,3)         66     (65)           69    (107)
                                          --     ---            --    ----
    EBITDA(3)                           $984    $102        $1,529    $375

    Adjusted EBITDA -
     continuing operations(3)            $51    $195          $643    $926

    Basic income (loss) per share      $2.56   $0.01         $2.62  $(0.78)
    Diluted income (loss) per share    $2.53   $0.01         $2.60  $(0.74)
    Adjusted diluted (loss) income per
     share from continuing
     operations(3)                    $(0.38)  $0.22        $(0.24)  $1.16

    Common share information:
      Basic shares outstanding           234     221           232     221
      Diluted shares                     236     234           234     233

    See end of press release for footnote explanations


                               Huntsman Corporation
                                  Segment Results

                                  Three months ended           Year ended
                                     December 31,             December 31,
      In millions                   2008     2007            2008     2007
                                    ----     ----            ----     ----
      Segment Revenues:
        Polyurethanes               $796     $989          $4,055   $3,813
        Materials and Effects        470      613           2,395    2,419
        Performance Products         606      619           2,703    2,310
        Pigments                     186      274           1,072    1,109
        Eliminations and other       (10)       9             (10)       -
                                     ---        -             ---        -

          Total from continuing
           operations              2,048    2,504          10,215    9,651
        Discontinued operations (1)    -       45               -    1,063
                                  ------   ------         -------  -------
          Total                   $2,048   $2,549         $10,215  $10,714
                                  ======   ======         =======  =======

      Segment EBITDA(3):
        Polyurethanes                $13     $142            $382     $592
        Materials and Effects        (19)      41             116      199
        Performance Products          93       49             278      202
        Pigments                     (16)       6              17       51
        Corporate and other          735       17             550     (342)
        Discontinued Base Chemicals &
         Polymers operations(1)      178     (153)            186     (327)
                                     ---     ----             ---     ----
                Total               $984     $102          $1,529     $375
                                    ====     ====          ======     ====

      Segment Adjusted EBITDA(3) :
        Polyurethanes                $13     $142            $382     $593
        Materials and Effects          2       47             140      224
        Performance Products          94       50             279      209
        Pigments                     (13)       6              21       54
        Corporate and other          (45)     (50)           (179)    (154)
                                     ---      ---            ----     ----
          Total from continuing
           operations                 51      195             643      926
        Discontinued operations (1)    -        -               -       24
                                     ---     ----            ----     ----
          Total                      $51     $195            $643     $950
                                     ===     ====            ====     ====



                             Three months ended
                                 December 31,       Year ended December 31,
                                2008 vs. 2007            2008 vs. 2007
      Period-Over-              -------------            -------------
       Period Increase        Average       Sales      Average      Sales
       (Decrease)          Selling Price   Volume   Selling Price   Volume
                           -------------   ------   -------------   ------

        Polyurethanes (a)        (3)%        (17)%         8%        (1)%
        Materials and
         Effects                  1%         (24)%         9%        (9)%
        Performance
         Products (a)            22%         (21)%        29%       (11)%
        Pigments                 10%         (38)%        10%       (12)%

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

See end of press release for footnote explanations

Three Months Ended December 31, 2008 as Compared to Three Months Ended December 31, 2007

Revenues for the three months ended December 31, 2008 decreased to $2,048 million from $2,504 million during the same period in 2007. Revenues decreased in all of our segments primarily due to lower sales volumes, partially offset by higher average selling prices in Materials and Effects, Performance Products and Pigments.

For the three months ended December 31, 2008, EBITDA was $984 million as compared to $102 million in the same period in 2007. Adjusted EBITDA from continuing operations for the three months ended December 31, 2008 was $51 million as compared to $195 million for the same period in 2007.

Polyurethanes

The decrease in revenues in the Polyurethanes segment for the three months ended December 31, 2008 compared to the same period in 2007 was due to lower sales volumes and lower average selling prices. MDI sales volumes decreased 13% primarily due to lower volumes in the U.S. and Europe related to lower auto and construction-related demand as well as production outages caused by the third quarter 2008 U.S. Gulf Coast Storms. These lower volumes were partially offset by modest growth in Asia. MDI average selling prices decreased 5% primarily due to the strength of the U.S. dollar versus foreign currencies in Europe and the sharp decline in market demand. PO and co-product MTBE sales volumes decreased due to production outages caused by the U.S. Gulf Coast Storms in the third quarter, while average selling prices decreased primarily due to the decline in market demand and lower MTBE raw material costs. The decrease in EBITDA in the Polyurethanes segment was primarily the result of lower margins related to higher valued raw material costs progressing through cost of sales, decreased volumes resulting from the overall economic slowdown, customer destocking and the lingering effects of the third quarter U.S. Gulf Coast Storms. In addition, we recognized a write-down of certain inventories to lower of cost or market values for $16 million.

Materials and Effects

The decrease in revenues in the Materials and Effects segment for the three months ended December 31, 2008 compared to the same period in 2007 was primarily due to lower sales volumes, partially offset by higher average selling prices. Total sales volumes decreased 24%, advanced materials volumes decreased 18% primarily due to lower demand in the automotive, electronics, construction and coatings markets, and textile effects sales volumes decreased 33% primarily due to lower demand in apparel, home textiles and specialty textile markets. Total average selling prices increased 1%, advanced materials average selling prices were essentially unchanged, and textile effects average selling prices increased 3%. The advanced materials business contributed $301 million in revenues for the three months ended December 31, 2008, while the textile effects business contributed $169 million in revenues for the same period. The decrease in EBITDA in the Materials and Effects segment was primarily due to lower sales volumes resulting from the overall economic slowdown, customer destocking and higher valued raw material costs progressing through cost of sales. The advanced materials business contributed $21 million of EBITDA for the three months ended December 31, 2008, while the textile effects business incurred a loss of $40 million.

Performance Products

The decrease in revenues in the Performance Products segment for the three months ended December 31, 2008 compared to the same period in 2007 was primarily due to a 21% (excluding tolling) decrease in sales volumes, partially offset by a 22% increase in average selling prices and higher tolling revenues. Sales volumes (excluding tolling), decreased across most all product lines primarily due to the overall economic slowdown, customer destocking, and the conversion of most of our ethylene glycol business to a toll manufacturing operation in 2008. Sales volumes for our surfactants were the most resilient, in fact, surfactant volumes sold into agricultural applications increased in the 2008 period. Average selling prices increased from price increase initiatives in response to higher raw material costs. The increase in EBITDA in the Performance Products segment was primarily due to higher contribution margins resulting from higher selling prices and lower raw material costs.

Pigments

The decrease in revenues in the Pigments segment for the three months ended December 31, 2008 compared to the same period in 2007 was primarily due to a 38% decrease in sales volumes partially offset by a 10% increase in average selling prices. Sales volumes decreased primarily due to the overall economic slowdown and customer destocking. The decrease in EBITDA in the Pigments segment was primarily due to lower sales volumes and higher valued raw material costs progressing through cost of sales.

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 income and expense, 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 fourth quarter of 2008, the total of these items was a gain of $735 million compared to a gain of $17 million in the 2007 period. The increase in EBITDA from these items was primarily the result of an $820 million increase in the income associated with the Hexion merger ($815 million of income recorded in the 2008 period compared to $5 million of expense in the 2007 period).

Income Taxes

During the three months ended December 31, 2008, we recorded $148 million of income tax expense compared to $3 million of income tax benefit in the comparable period of 2007. During the fourth quarter of 2008, we recorded income tax expense on the receipt of the settlement payments (net of merger related expenses) along with income tax expense due to our inability to record a tax benefit for losses in certain tax jurisdictions, partially offset by favorable tax authority dispute resolutions.

As of December 31, 2008, we have fully utilized all of our U.S. federal regular tax net operating loss carryforwards. We continue to have net operating loss carryforwards in many of our other significant tax jurisdictions.

Liquidity, Capital Resources and Outstanding Debt

During December 2008, in connection with the Settlement Agreement, we received cash proceeds of $1 billion, including the proceeds from the sale of the 7% convertible senior notes. We used $423 million of these proceeds to repay our revolving credit facility in full as of December 31, 2008. As of December 31, 2008, we had $1,291 million of combined cash and unused borrowing capacity compared with approximately $536 million for the most recent quarter ended September 30, 2008.

During the three months ended December 31, 2008, net debt plus outstandings under our off-balance sheet accounts receivable securitization program decreased approximately $601 million, primarily due to net proceeds in connection with the Settlement Agreement. During the fourth quarter, our changes in accounts receivable, and inventory net of accounts payable decreased favorably by approximately $112 million.

For the three months ended December 31, 2008, total capital expenditures were approximately $93 million compared to approximately $198 million for the same period in 2007. For the year ended December 31, 2008, total capital expenditures were approximately $418 million compared to approximately $665 million for the same period in 2007. The capital expenditures for the year ended December 31, 2007 included $157 million spent on our former Port Arthur, Texas facility that was previously damaged by fire and has since been sold to Flint Hills Resources. We expect to spend approximately $230 million on capital expenditures in 2009.

In connection with our ongoing insurance claim related to the April 29, 2006 Port Arthur, Texas fire, we have received partial insurance proceeds to date of $365 million, of which $40 million was received in December of 2008. We have claimed an additional $235 million as presently due and owing and unpaid under our insurance policies as of December 31, 2008, and anticipate filing additional claims. The settlement of insurance claims will continue during 2009. Any anticipated recoveries are expected to be used to repay secured debt.

    Below is our outstanding debt:



                                 December 31,  September 30,  December 31,
      In millions                    2008          2008          2007
                                     ----          ----          ----
      Debt:
        Senior Credit Facilities   $1,540        $1,894        $1,540
        Secured Notes                 295           295           294
        Senior Notes                  198           198           198
        Subordinated Notes          1,285         1,308         1,311
        Other Debt                    329           263           226
        Convertible Notes             235             -             -
                                      ---             -             -
      Total Debt                    3,882         3,958         3,569
                                    -----         -----         -----
      Total Cash                      662           113           154
                                      ---           ---           ---
      Net Debt                     $3,220        $3,845        $3,415
                                   ======        ======        ======
      Off-balance sheet accounts
       receivable securitization
       program                       $446          $422          $428



                             Huntsman Corporation
                        Reconciliation of Adjustments

                                           Net Income
                                         (Loss) Available      Diluted
                                            To Common       Income (Loss)
                               EBITDA      Stockholders       Per Share
                               ------      ------------      ---------
                            Three months    Three months    Three months
    In millions,               ended           ended           ended
     except per             December 31,    December 31,    December 31,
     share amounts          2008   2007     2008    2007    2008    2007
    --------------          ----   ----     ----    ----    ----    ----
    GAAP                    $984   $102     $598      $2   $2.53   $0.01
    Adjustments:
      Loss on accounts
       receivable
       securitization
       program                11      5        -       -       -       -
      Unallocated foreign
       currency loss          25      2       12       2    0.05    0.01
      Loss on early
       extinguishment
       of debt                 1      -        -       -       -       -
      Other restructuring,
       impairment and plant
       closing costs          28      8       25       8    0.11    0.03
      (Income) expenses
       associated with the
       Merger               (815)     5     (610)      5   (2.58)   0.02
      Gain on dispositions
       of assets              (1)   (69)       -     (43)      -   (0.18)
      (Income) loss from
       discontinued
       operations, net of
       tax(1)               (178)   141     (112)     76   (0.47)   0.33
      Extraordinary
       (gain) loss on
       the acquisition
       of a business,
       net of tax(2)          (4)     1       (4)      1   (0.02)      -
                             ---   ----     ----     ---  ------     ---
    Adjusted continuing
     operations              $51   $195     $(91)    $51  $(0.38)  $0.22

    Discontinued
      operations            $178  $(141)    $112    $(76)  $0.47  $(0.33)
      Restructuring,
       impairment and
       plant closing
       costs                   -      -        -       -       -       -
      (Gain) loss on
       disposition of
       assets                 (3)   142       (2)     85   (0.01)   0.36
      Gain on
       partial fire
       insurance
       settlement           (175)     -     (110)      -   (0.47)      -
      Gain on accounts
       receivable
       securitization
       program                 -     (1)       -       -       -       -
                             ---    ---      ---     ---     ---     ---
    Adjusted
     discontinued
     operations(1)            $-     $-       $-      $9      $-   $0.04



                                                            Three months
                                                               ended
                                                           September 30,
    In millions                                                2008
    -----------

    Net loss                                                    $(20)
    Interest expense, net                                         68
    Income tax expense                                            18
    Depreciation and amortization                                 99
    Income taxes, depreciation and amortization included in
     discontinued operations(1,3)                                  -
                                                                 ---
    EBITDA(3)                                                   $165



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

    GAAP                           $165            $(20)        $(0.09)
    Adjustments:
      Loss on accounts
       receivable
       securitization program         6               -              -
      Unallocated foreign
       currency gain                 (4)             (8)         (0.03)
      Other restructuring,
       impairment and plant
       closing costs                  4               3           0.01
      Expenses associated with
       the Merger                    26              26           0.11
      Income from
       discontinued
       operations, net of
       tax(1)                        (1)             (1)             -
      Extraordinary gain on
       the acquisition of a
       business, net of
       tax(2)                        (2)             (2)         (0.01)
                                    ---             ---         ------
    Adjusted continuing
     operations                    $194             $(2)        $(0.01)



                                            Net Income
                                          (Loss) Available     Diluted
                                             To Common       Income (Loss)
                               EBITDA       Stockholders      Per Share
                               ------       ------------      ---------
    In millions,             Year ended     Year ended       Year ended
     except per share       December 31,    December 31,    December 31,
     amounts                2008   2007     2008    2007    2008    2007
    -----------------       ----   ----     ----    ----    ----    ----

    GAAP                   $1,529   $375     $609   $(172)  $2.60   (0.74)
    Adjustments:
      Loss on accounts
       receivable
       securitization
       program                 27     21        -       -       -       -
      Unallocated foreign
       currency loss           31     12        9       9    0.04    0.04
      Legal and contract
       settlements              -      6        -       4       -    0.02
      Loss on early
       extinguishment of
       debt                     1      2        -       1       -       -
      Other
       restructuring,
       impairment and
       plant closing
       costs                   36     42       32      42    0.14    0.18
      (Income)
       expenses
       associated
       with the Merger       (780)   210     (575)    210   (2.45)   0.90
      Gain on
       dispositions of
       assets                  (1)   (73)      (1)    (47)      -   (0.20)
      (Income) loss from
       discontinued
       operations, net of
       tax(1)                (186)   324     (117)    217   (0.50)   0.93
      Extraordinary
       (gain) loss on
       the acquisition
       of a business,
       net of tax(2)          (14)     7      (14)      7   (0.06)   0.03
                             ----   ----     ----    ----  ------   -----
      Adjusted
       continuing
       operations            $643   $926     $(57)   $271  $(0.24)  $1.16

    Discontinued
     operations              $186  $(324)    $117   $(217)  $0.50  $(0.93)
      Restructuring,
       impairment and
       plant closing costs      -      2        -       1       -       -
      (Gain) loss on
       disposition of
       assets                 (11)   339       (7)    206   (0.03)   0.88
      Gain on partial
       fire insurance
       settlement            (175)     -     (110)      -   (0.47)      -
      Loss on accounts
       receivable
       securitization
       program                  -      7        -       -       -       -
                              ---    ---      ---     ---     ---     ---
    Adjusted
     discontinued
     operations(1)             $-    $24       $-    $(10)     $-  $(0.04)

    See end of press release for footnote explanations
    Conference Call Information

We will hold a conference call to discuss our fourth quarter and full year 2008 financial results on Thursday, February 26, 2009 at 11:00 a.m. ET.


    Call-in number for U.S. participants:           (888) 679 - 8037
    Call-in number for international participants:  (617) 213 - 4849
    Participant access code:                        39789814

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=PG6PAHWM6

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 February 26, 2009 and ending March 5, 2009.


    Call-in numbers for the replay:
      Within the U.S.:         (888) 286 - 8010
      International:           (617) 801 - 6888
    Access code for replay:    46784120

About Huntsman:

Huntsman (NYSE: HUN) is a global manufacturer and marketer of differentiated chemicals. Its operating companies manufacture products for a variety of global industries, including chemicals, plastics, automotive, aviation, textiles, footwear, paints and coatings, construction, technology, agriculture, health care, detergent, personal care, furniture, appliances and packaging. Originally known for pioneering innovations in packaging and, later, for rapid and integrated growth in petrochemicals, Huntsman today has more than 12,000 employees and operates from multiple locations worldwide. The Company had 2008 revenues of approximately $10 billion. For more information about Huntsman, please visit the company's website at www.huntsman.com.

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 transactions 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.

(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. Segment EBITDA discontinued operations only includes the results of our U.S. base chemicals, U.S. polymers and European petrochemical businesses.

(2) On June 30, 2006, we acquired the global textile effects business of Ciba Specialty Chemicals Inc. for approximately $172 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 December 31, 2008 and 2007 respectively were $4 million gain and $(1) million loss 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 income and expense; 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 the following 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; gain on partial fire insurance settlement; and (gain) loss on disposition of assets. The following table provides a reconciliation of Adjusted EBITDA from discontinued operations to income (loss) from discontinued operations:



                                           Three months
                                              ended      Year ended
                                           December 31,   December 31,
                                           2008   2007   2008   2007
                                           ----   ----   ----   ----
    Income (loss) from discontinued
     operations, net of tax                $112   $(76)  $117  $(217)
      Income tax expense (benefit)          $66   $(67)   $69  $(140)
      Depreciation and amortization          $-     $2     $-    $33
                                             --     --     --    ---
    EBITDA from discontinued operations    $178  $(141)  $186  $(324)
      Restructuring, impairment and
       plant closing costs                   $-     $-     $-     $2
      (Gain) loss on disposition of
       assets                               $(3)  $142   $(11)  $339
      Gain on partial fire insurance
       settlement                         $(175)    $-  $(175)    $-
      (Gain) loss on accounts receivable
       securitization                        $-    $(1)    $-     $7
                                             --    ---     --     --
    Adjusted EBITDA from discontinued
     operations                              $-     $-     $-    $24
                                             ==     ==     ==    ===

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 income and expense; 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; gain on partial fire insurance settlement; and (gain) loss on the disposition 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-                           02/26/2009
    /CONTACT:  Media, Russ Stolle, +1-281-719-6624, or Investors, 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

PR
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