Table of Contents

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549 

Form 10‑Q

(Mark One)

 

 

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2018

 

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

 

For the transition period from                          to                         

 

 

Commission
File Number

    

Exact Name of Registrant as Specified in its Charter,
Principal Office Address and Telephone Number

    

State of
Incorporation
or Organization

    

I.R.S. Employer
Identification No.

001‑32427

 

Huntsman Corporation
10003 Woodloch Forest Drive
The Woodlands, Texas 77380
(281) 719-6000

 

Delaware

 

42‑1648585

333‑85141

 

Huntsman International LLC
10003 Woodloch Forest Drive
The Woodlands, Texas 77380
(281) 719-6000

 

Delaware

 

87‑0630358


Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Huntsman Corporation

YES ☒

NO ☐

Huntsman International LLC

YES ☒

NO ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S‑T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

 

Huntsman Corporation

YES ☒

NO ☐

Huntsman International LLC

YES ☒

NO ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non‑accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b‑2 of the Exchange Act. (Check one):

 

 

 

 

 

 

Huntsman Corporation

Large accelerated filer ☒

Accelerated filer ☐

Non‑accelerated filer ☐

Smaller reporting company ☐

Emerging growth company ☐

Huntsman International LLC

Large accelerated filer ☐

Accelerated filer ☐

Non‑accelerated filer ☒

Smaller reporting company ☐

Emerging Growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 

 

Huntsman Corporation

 

Huntsman International LLC

 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Exchange Act).

Huntsman Corporation

YES ☐

NO ☒

Huntsman International LLC

YES ☐

NO ☒


On October 22, 2018, 238,321,460 shares of common stock of Huntsman Corporation were outstanding and 2,728 units of membership interests of Huntsman International LLC were outstanding. There is no trading market for Huntsman International LLC’s units of membership interests. All of Huntsman International LLC’s units of membership interests are held by Huntsman Corporation.


This Quarterly Report on Form 10‑Q presents information for two registrants: Huntsman Corporation and Huntsman International LLC. Huntsman International LLC is a wholly-owned subsidiary of Huntsman Corporation and is the principal operating company of Huntsman Corporation. The information reflected in this Quarterly Report on Form 10‑Q is equally applicable to both Huntsman Corporation and Huntsman International LLC, except where otherwise indicated. Huntsman International LLC meets the conditions set forth in General Instructions H(1)(a) and (b) of Form 10‑Q and, to the extent applicable, is therefore filing this form with a reduced disclosure format.

 

 

 

 

 


 

Table of Contents

HUNTSMAN CORPORATION AND SUBSIDIARIES

HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES

QUARTERLY REPORT ON FORM 10‑Q FOR THE QUARTERLY PERIOD

ENDED SEPTEMBER 30, 2018

 

TABLE OF CONTENTS

 

 

    

 

 

Page

PART I 

 

FINANCIAL INFORMATION

 

4

ITEM 1. 

 

Condensed Consolidated Financial Statements (Unaudited)

 

4

 

 

Huntsman Corporation and Subsidiaries:

 

 

 

 

Condensed Consolidated Balance Sheets

 

4

 

 

Condensed Consolidated Statements of Operations

 

5

 

 

Condensed Consolidated Statements of Comprehensive (Loss) Income

 

6

 

 

Condensed Consolidated Statements of Equity

 

7

 

 

Condensed Consolidated Statements of Cash Flows

 

8

 

 

Huntsman International LLC and Subsidiaries:

 

 

 

 

Condensed Consolidated Balance Sheets

 

10

 

 

Condensed Consolidated Statements of Operations

 

11

 

 

Condensed Consolidated Statements of Comprehensive (Loss) Income 

 

12

 

 

Condensed Consolidated Statements of Equity

 

13

 

 

Condensed Consolidated Statements of Cash Flows

 

14

 

 

Huntsman Corporation and Subsidiaries and Huntsman International LLC and Subsidiaries:

 

 

 

 

Notes to Condensed Consolidated Financial Statements

 

16

ITEM 2. 

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

48

ITEM 3. 

 

Quantitative and Qualitative Disclosures About Market Risk

 

66

ITEM 4. 

 

Controls and Procedures

 

67

PART II 

 

OTHER INFORMATION

 

68

ITEM 1. 

 

Legal Proceedings

 

68

ITEM 1A. 

 

Risk Factors

 

68

ITEM 2. 

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

68

ITEM 6. 

 

Exhibits

 

68

 

 

2


 

Table of Contents

HUNTSMAN CORPORATION AND SUBSIDIARIES

HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES

QUARTERLY REPORT ON FORM 10‑Q FOR THE QUARTERLY PERIOD

ENDED SEPTEMBER 30, 2018

 

FORWARD‑LOOKING STATEMENTS

 

Certain information set forth in this report contains “forward‑looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than historical factual information are forward‑looking statements, including without limitation statements regarding: projections of revenue, expenses, profit, profit margins, tax rates, tax provisions, cash flows, pension and benefit obligations and funding requirements, our liquidity position or other projected financial measures; management’s plans and strategies for future operations, including statements relating to anticipated operating performance, cost reductions, restructuring activities, new product and service developments, competitive strengths or market position, acquisitions, divestitures, business separations, spin‑offs, or other distributions, strategic opportunities, securities offerings, stock repurchases, dividends and executive compensation; growth, declines and other trends in markets we sell into; new or modified laws, regulations and accounting pronouncements; outstanding claims, legal proceedings, tax audits and assessments and other contingent liabilities; foreign currency exchange rates and fluctuations in those rates; general economic and capital markets conditions; the timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that we intend or believe will or may occur in the future. In some cases, forward‑looking statements can be identified by terminology such as “believes,” “expects,” “may,” “will,” “should,” “anticipates” or “intends” or the negative of such terms or other comparable terminology, or by discussions of strategy. We may also make additional forward‑looking statements from time to time. All such subsequent forward‑looking statements, whether written or oral, by us or on our behalf, are also expressly qualified by these cautionary statements.

 

All forward‑looking statements, including without limitation any projections derived from management’s examination of historical operating trends, are based upon our current expectations and various assumptions. Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for them, but there can be no assurance that management’s expectations, beliefs and projections will be achieved. All forward‑looking statements apply only as of the date made. We undertake no obligation to publicly update or revise forward‑looking statements whether because of new information, future events or otherwise, except as required by securities and other applicable law.

 

There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward‑looking statements contained in or contemplated by this report. Any forward‑looking statements should be considered in light of the risks set forth in “Part II. Item 1A. Risk Factors” below and “Part I. Item 1A. Risk Factors” in our Annual Report on Form 10‑K for the year ended December 31, 2017.

3


 

Table of Contents

PART I. FINANCIAL INFORMATION

 

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

HUNTSMAN CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Millions, Except Share and Per Share Amounts)

 

 

 

 

 

 

 

 

 

 

September 30, 

 

December 31, 

 

    

2018

    

2017

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents(a)

 

$

446

 

$

470

Restricted cash(a)

 

 

 —

 

 

11

Accounts and notes receivable (net of allowance for doubtful accounts of $24 and $25, respectively), ($402 and $334 pledged as collateral, respectively)(a)

 

 

1,379

 

 

1,256

Accounts receivable from affiliates

 

 

15

 

 

27

Inventories(a)

 

 

1,231

 

 

1,073

Prepaid expenses

 

 

50

 

 

60

Other current assets(a)

 

 

180

 

 

202

Current assets held for sale

 

 

2,916

 

 

2,880

Total current assets 

 

 

6,217

 

 

5,979

Property, plant and equipment, net(a)

 

 

3,004

 

 

3,098

Investment in unconsolidated affiliates

 

 

303

 

 

266

Intangible assets, net(a)

 

 

119

 

 

56

Goodwill

 

 

388

 

 

140

Deferred income taxes

 

 

300

 

 

208

Other noncurrent assets(a)

 

 

565

 

 

497

Total assets 

 

$

10,896

 

$

10,244

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable(a)

 

$

964

 

$

946

Accounts payable to affiliates

 

 

34

 

 

18

Accrued liabilities(a)

 

 

540

 

 

569

Current portion of debt(a)

 

 

200

 

 

40

Current liabilities held for sale

 

 

1,564

 

 

1,692

Total current liabilities 

 

 

3,302

 

 

3,265

Long-term debt(a)

 

 

2,277

 

 

2,258

Deferred income taxes

 

 

280

 

 

264

Other noncurrent liabilities(a)

 

 

1,073

 

 

1,086

Total liabilities 

 

 

6,932

 

 

6,873

Commitments and contingencies (Notes 15 and 16)

 

 

 

 

 

 

Equity

 

 

 

 

 

 

Huntsman Corporation stockholders’ equity:

 

 

 

 

 

 

Common stock $0.01 par value, 1,200,000,000 shares authorized, 255,949,032 and 252,759,715 shares issued and 237,446,147 and 240,213,606 shares outstanding, respectively

 

 

 3

 

 

 3

Additional paid-in capital

 

 

3,982

 

 

3,889

Treasury stock, 18,502,888 and 12,607,223 shares, respectively

 

 

(325)

 

 

(150)

Unearned stock-based compensation

 

 

(19)

 

 

(15)

Retained earnings

 

 

671

 

 

161

Accumulated other comprehensive loss

 

 

(1,354)

 

 

(1,268)

Total Huntsman Corporation stockholders’ equity 

 

 

2,958

 

 

2,620

Noncontrolling interests in subsidiaries

 

 

1,006

 

 

751

Total equity 

 

 

3,964

 

 

3,371

Total liabilities and equity 

 

$

10,896

 

$

10,244


(a)

At September 30, 2018 and December 31, 2017, respectively, $23 and $15 of cash and cash equivalents, nil and $11 of restricted cash, $32 and $35 of accounts and notes receivable (net), $56 and $46 of inventories, $6 and $7 of other current assets, $257 and $283 of property, plant and equipment (net), $11 and $10 of intangible assets (net), $54 and $43 of other noncurrent assets, $91 and $109 of accounts payable, $33 and $32 of accrued liabilities, $23 and $21 of current portion of debt, $71 and $86 of long‑term debt, and $94 and $98 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See “Note 6. Variable Interest Entities.”

 

See accompanying notes to condensed consolidated financial statements.

 

4


 

Table of Contents

HUNTSMAN CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Millions, Except Per Share Amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months

 

Nine months

 

    

ended

 

ended

 

 

September 30, 

 

September 30,

 

 

2018

 

2017

 

2018

    

2017

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Trade sales, services and fees, net

 

$

2,400

 

$

2,137

 

$

7,022

 

$

6,048

Related party sales

 

 

44

 

 

32

 

 

121

 

 

107

Total revenues 

 

 

2,444

 

 

2,169

 

 

7,143

 

 

6,155

Cost of goods sold 

 

 

1,920

 

 

1,697

 

 

5,524

 

 

4,857

Gross profit 

 

 

524

 

 

472

 

 

1,619

 

 

1,298

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

213

 

 

198

 

 

612

 

 

583

Research and development

 

 

37

 

 

35

 

 

113

 

 

103

Restructuring, impairment and plant closing costs

 

 

 5

 

 

 1

 

 

 8

 

 

13

Merger costs

 

 

 1

 

 

12

 

 

 2

 

 

18

Other operating expense (income), net

 

 

 1

 

 

 5

 

 

22

 

 

(9)

Total operating expenses

 

 

257

 

 

251

 

 

757

 

 

708

Operating income   

 

 

267

 

 

221

 

 

862

 

 

590

Interest expense

 

 

(30)

 

 

(39)

 

 

(86)

 

 

(134)

Equity in income of investment in unconsolidated affiliates

 

 

14

 

 

 1

 

 

45

 

 

 4

Loss on early extinguishment of debt

 

 

 —

 

 

(35)

 

 

(3)

 

 

(36)

Other income, net

 

 

 5

 

 

 3

 

 

20

 

 

 7

Income from continuing operations before income taxes 

 

 

256

 

 

151

 

 

838

 

 

431

Income tax expense

 

 

(27)

 

 

(35)

 

 

(84)

 

 

(78)

Income from continuing operations 

 

 

229

 

 

116

 

 

754

 

 

353

(Loss) income from discontinued operations, net of tax

 

 

(237)

 

 

63

 

 

211

 

 

101

Net (loss) income

 

 

(8)

 

 

179

 

 

965

 

 

454

Net income attributable to noncontrolling interests

 

 

(3)

 

 

(32)

 

 

(288)

 

 

(64)

Net (loss) income attributable to Huntsman Corporation 

 

$

(11)

 

$

147

 

$

677

 

$

390

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic (loss) income per share:

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations attributable to Huntsman Corporation common stockholders

 

$

0.86

 

$

0.36

 

$

2.88

    

$

1.22

(Loss) income from discontinued operations attributable to Huntsman Corporation common stockholders, net of tax

 

 

(0.91)

 

 

0.26

 

 

(0.05)

 

 

0.42

Net (loss) income attributable to Huntsman Corporation common stockholders

 

$

(0.05)

 

$

0.62

 

$

2.83

 

$

1.64

Weighted average shares

 

 

237.9

 

 

238.5

 

 

239.1

 

 

238.0

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted (loss) income per share:

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations attributable to Huntsman Corporation common stockholders

 

$

0.85

 

$

0.34

 

$

2.83

 

$

1.19

(Loss) income from discontinued operations attributable to Huntsman Corporation common stockholders, net of tax

 

 

(0.90)

 

 

0.26

 

 

(0.04)

 

 

0.41

Net (loss) income attributable to Huntsman Corporation common stockholders

 

$

(0.05)

 

$

0.60

 

$

2.79

 

$

1.60

Weighted average shares

 

 

240.8

 

 

244.0

 

 

243.0

 

 

243.5

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts attributable to Huntsman Corporation common stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

205

 

$

84

 

$

688

 

$

289

(Loss) income from discontinued operations, net of tax

 

 

(216)

 

 

63

 

 

(11)

 

 

101

Net (loss) income

 

$

(11)

 

$

147

 

$

677

 

$

390

Dividends per share 

 

$

0.1625

 

$

0.125

 

$

0.4875

 

$

0.375

 

See accompanying notes to condensed consolidated financial statements.

 

5


 

Table of Contents

HUNTSMAN CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(In Millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months

 

 

Nine months

 

 

ended

 

 

ended

 

 

September 30, 

 

 

September 30, 

 

    

2018

    

2017

    

 

2018

    

2017

Net (loss) income

 

$

(8)

 

$

179

 

 

$

965

 

$

454

Other comprehensive (loss) income, net of tax: 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

 

(41)

 

 

66

 

 

 

(156)

 

 

201

Pension and other postretirement benefits adjustments

 

 

16

 

 

18

 

 

 

61

 

 

55

Other, net

 

 

 —

 

 

(1)

 

 

 

(8)

 

 

(3)

Other comprehensive (loss) income, net of tax

 

 

(25)

 

 

83

 

 

 

(103)

 

 

253

Comprehensive (loss) income

 

 

(33)

 

 

262

 

 

 

862

 

 

707

Comprehensive income attributable to noncontrolling interests

 

 

(2)

 

 

(37)

 

 

 

(256)

 

 

(76)

Comprehensive (loss) income attributable to Huntsman Corporation 

 

$

(35)

 

$

225

 

 

$

606

 

$

631

 

See accompanying notes to condensed consolidated financial statements.

 

 

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Table of Contents

HUNTSMAN CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(In Millions, Except Share Amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Huntsman Corporation Stockholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retained

 

Accumulated

 

 

 

 

 

 

 

 

Shares

 

 

 

 

Additional

 

 

 

 

Unearned

 

earnings

 

other

 

Noncontrolling

 

 

 

 

 

Common

 

Common

 

paid-in

 

Treasury

 

stock-based

 

(accumulated

 

comprehensive

 

interests in

 

Total

 

    

stock

    

stock

    

capital

    

stock

    

compensation

    

deficit)

    

loss

    

subsidiaries

    

equity

Balance, January 1, 2018

 

240,213,606

    

$

 3

    

$

3,889

    

$

(150)

    

$

(15)

    

$

161

    

$

(1,268)

    

$

751

    

$

3,371

Cumulative effect of changes in fair value of equity investments

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

10

 

 

(10)

 

 

 —

 

 

 —

Revised balance January 1, 2018

 

240,213,606

 

 

 3

 

 

3,889

 

 

(150)

 

 

 (15)

 

 

171

 

 

(1,278)

 

 

751

 

 

3,371

Net income

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

677

 

 

 —

 

 

288

 

 

965

Other comprehensive loss

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(76)

 

 

(27)

 

 

(103)

Issuance of nonvested stock awards

 

 —

 

 

 —

 

 

14

 

 

 —

 

 

(14)

 

 

 —

 

 

 —

 

 

 —

 

 

 —

Vesting of stock awards

 

1,127,211

 

 

 —

 

 

11

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

11

Recognition of stock-based compensation

 

 —

 

 

 —

 

 

 6

 

 

 —

 

 

10

 

 

 —

 

 

 —

 

 

 —

 

 

16

Repurchase and cancellation of stock awards

 

(259,495)

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(30)

 

 

 —

 

 

 —

 

 

(30)

Dividends paid to noncontrolling interests

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(33)

 

 

(33)

Stock options exercised

 

2,260,490

 

 

 —

 

 

46

 

 

 —

 

 

 —

 

 

(29)

 

 

 —

 

 

 —

 

 

17

Repurchase of common stock

 

(5,895,665)

 

 

 —

 

 

 —

 

 

(175)

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(175)

Disposition of a portion of P&A Business

 

 —

 

 

 —

 

 

18

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

18

Costs of the secondary offering of P&A Business

 

 —

 

 

 —

 

 

(2)

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(2)

Noncontrolling interest from partial disposal of P&A Business

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

27

 

 

27

Accrued and unpaid dividends

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(1)

 

 

 —

 

 

 —

 

 

(1)

Dividends declared on common stock

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(117)

 

 

 —

 

 

 —

 

 

(117)

Balance, September 30, 2018

 

237,446,147

 

$

 3

 

$

3,982

 

$

(325)

 

$

(19)

 

$

671

 

$

(1,354)

 

$

1,006

 

$

3,964

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, January 1, 2017

 

236,370,347

 

$

 3

 

$

3,447

 

$

(150)

 

$

(17)

 

$

(325)

 

$

(1,671)

 

$

180

 

$

1,467

Net income

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

390

 

 

 —

 

 

64

 

 

454

Other comprehensive income

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

313

 

 

(60)

 

 

253

Issuance of nonvested stock awards

 

 —

 

 

 —

 

 

17

 

 

 —

 

 

(17)

 

 

 —

 

 

 —

 

 

 —

 

 

 —

Vesting of stock awards

 

1,200,218

 

 

 —

 

 

 8

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 8

Recognition of stock-based compensation

 

 —

 

 

 —

 

 

 7

 

 

 —

 

 

13

 

 

 —

 

 

 —

 

 

 —

 

 

20

Repurchase and cancellation of stock awards

 

(348,887)

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(8)

 

 

 —

 

 

 —

 

 

(8)

Contribution from noncontrolling interests

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 4

 

 

 4

Dividends paid to noncontrolling interests

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(26)

 

 

(26)

Disposition of a portion of P&A Business

 

 —

 

 

 —

 

 

209

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

209

Separation costs of P&A Business

 

 —

 

 

 —

 

 

(40)

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(40)

Conversion of restricted awards to P&A Business awards

 

 —

 

 

 —

 

 

(2)

 

 

 —

 

 

 2

 

 

 —

 

 

 —

 

 

 —

 

 

 —

Noncontrolling interest from partial disposal of P&A Business

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

318

 

 

318

Stock options exercised

 

1,388,141

 

 

 —

 

 

37

 

 

 —

 

 

 —

 

 

(15)

 

 

 —

 

 

 —

 

 

22

Dividends declared on common stock

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(90)

 

 

 —

 

 

 —

 

 

(90)

Balance, September 30, 2017

 

238,609,819

 

$

 3

 

$

3,683

 

$

(150)

 

$

(19)

 

$

(48)

 

$

(1,358)

 

$

480

 

$

2,591

See accompanying notes to condensed consolidated financial statements.

 

 

7


 

Table of Contents

HUNTSMAN CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Millions)

 

 

 

 

 

 

 

 

 

 

Nine months

 

 

ended

 

 

September 30, 

 

    

2018

    

2017

Operating Activities:

 

 

 

 

 

 

Net income

 

$

965

 

$

454

Less: Income from discontinued operations, net of tax

 

 

(211)

 

 

(101)

Income from continuing operations

 

 

754

 

 

353

Adjustments to reconcile income from continuing operations to net cash provided by operating activities from continuing operations:

 

 

 

 

 

 

Equity in income of investment in unconsolidated affiliates

 

 

(45)

 

 

(4)

Depreciation and amortization

 

 

250

 

 

235

Loss (gain) on disposal of businesses/assets, net

 

 

 3

 

 

(5)

Loss on early extinguishment of debt

 

 

 3

 

 

36

Noncash interest expense

 

 

 1

 

 

 7

Noncash restructuring and impairment charges

 

 

 2

 

 

 —

Deferred income taxes

 

 

(94)

 

 

24

Noncash loss (gain) on foreign currency transactions

 

 

 3

 

 

(4)

Stock-based compensation

 

 

22

 

 

25

Other, net

 

 

 5

 

 

 3

Changes in operating assets and liabilities, net of effects of acquisitions:

 

 

 

 

 

 

Accounts and notes receivable

 

 

(129)

 

 

(148)

Inventories

 

 

(170)

 

 

(118)

Prepaid expenses

 

 

 7

 

 

 2

Other current assets

 

 

12

 

 

31

Other noncurrent assets

 

 

(75)

 

 

(22)

Accounts payable

 

 

62

 

 

95

Accrued liabilities

 

 

(15)

 

 

46

Other noncurrent liabilities

 

 

38

 

 

(18)

Net cash provided by operating activities from continuing operations

 

 

634

 

 

538

Net cash provided by operating activities from discontinued operations

 

 

300

 

 

205

Net cash provided by operating activities

 

 

934

 

 

743

 

 

 

 

 

 

 

Investing Activities:

 

 

 

 

 

 

Capital expenditures

 

 

(180)

 

 

(159)

Acquisition of businesses, net of cash acquired

 

 

(366)

 

 

(14)

Proceeds from sale of businesses/assets

 

 

 —

 

 

21

Cash received from termination of cross-currency interest rate contracts

 

 

 —

 

 

 7

Net cash used in investing activities from continuing operations

 

 

(546)

 

 

(145)

Net cash used in investing activities from discontinued operations

 

 

(265)

 

 

(49)

Net cash used in investing activities

 

 

(811)

 

 

(194)

 

(Continued)

8


 

Table of Contents

HUNTSMAN CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(In Millions)