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Huntsman Corporation | 2019 Annual Report
WE ARE GROWING OUR DOWNSTREAM SPECIALTY AND DIFFERENTIATED BUSINESSES.
Huntsman Corporation is a publicly traded global manufacturer and marketer of
specialty and differentiated chemicals. Our products are sold worldwide and
serve a broad and diverse range of consumer and industrial end markets.
2019 Milestones
➢
➢
➢
➢
➢
➢
➢
➢
Agreed to sell our Chemical Intermediates and Surfactants businesses to Indorama Ventures for
approximately $2 billion, which further strengthens our investment grade balance sheet and reduces
our upstream footprint. (The divesture was completed on January 3, 2020.)
Achieved investment grade ratings from Moody’s Investor Services, Inc. and Fitch Ratings, Inc. and
issued $750 million of senior notes due 2029. Proceeds were used to redeem $650 million of our senior
notes due 2020 and for general corporate purposes.
Generated free cash flow of $389 million in 2019 and ended the year with net debt leverage of 1.7 times;
pro forma net debt leverage considering the net proceeds from the sale of our Chemical Intermediates
and Surfactants businesses that closed on January 3, 2020 is less than 0.5 times.
Paid out $150 million in dividends to our shareholders and repurchased 10.1 million shares for
approximately $208 million. Total shareholder return for 2019 was approximately 29%.
Published our “Horizon 2025” corporate EHS strategy and set targets for our occupational safety,
process safety and environmental performance over the next six years.
Announced an agreement in December 2019 to acquire Icynene-Lapolla for $350 million, which will
nearly double the size of Huntsman’s existing spray polyurethane foam insulation business.
Acquired the remaining 50% interest in the Sasol-Huntsman maleic anhydride joint venture from Sasol
for approximately $100 million in September 2019.
Expanded our polyurethanes downstream system house network by opening a new facility in Dubai, UAE.
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Huntsman Corporation | 2019 Annual Report
Peter R. Huntsman
Chairman, President and Chief Executive Officer
paid $150 million in dividends and repurchased 10.1 million
shares for $208 million. We have $516 million remaining on
our authorized share repurchase program as of December
31, 2019 and will remain balanced in our capital allocation
program going forward in 2020.
As we enter a new decade, we will continue to manage
that which is within our control—costs, financial strength,
and improving our overall portfolio through internal
investments and strategic complementary acquisitions.
Additionally, we will maintain a laser focus on three
strategic fronts.
First: The safety and well-being of our associates and
stakeholders. This includes not only our commitment
to safety, but also our continuous improvement to the
environment, our local communities and making sure
we listen to our customers, suppliers, shareholders,
and the communities where we do business.
Second: Growth and capital allocation. With an
exceptional balance sheet and core global business
platform, Huntsman Corporation has never been better
positioned to take advantage of growth opportunities,
including strategic acquisitions, as well as provide
enhanced shareholder returns through a competitive
dividend and opportunistic share repurchases.
Third: Innovation. We will continue to introduce innovative
solutions, products and value-adding services to our
customers, particularly in markets striving to improve
energy efficiency and light-weighting. We will provide the
tools for this innovation and maintain an environment that
rewards creativity.
Thank you for your confidence in Huntsman. I look forward
to updating you again in next year’s letter.
Peter R. Huntsman
Chairman, President and CEO
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Dear Fellow Shareholders:
As I write this letter, Huntsman Corporation is just a few
weeks beyond having closed the sale of our Chemical
Intermediates and Surfactants businesses to Indorama
Ventures for approximately $2 billion, which was finalized
on January 3, 2020, and which concluded a strategically
eventful 2019 that left us firmly positioned to drive consistent
shareholder value for years to come. This transformational
divestiture significantly reduces our capital-intensive
upstream asset base, further bolstering an already strong
balance sheet and enabling us to more aggressively invest
in and grow our downstream businesses.
Throughout the year, we continued to invest in our core
downstream businesses. In September, we not only
opened a new polyurethanes systems house in Dubai,
strengthening our downstream capabilities in the Middle
East and North Africa, but we also acquired the remaining
50% interest in the Sasol-Huntsman maleic anhydride joint
venture for $100 million, consistent with our strategy to
invest in our businesses that deliver higher, more stable
margins and strong free cash flow.
In December, we announced our intention to acquire
Icynene-Lapolla, a leading North American manufacturer
and distributor of spray polyurethane foam (SPF) insulation
systems, for $350 million. This strategic move substantially
expands our energy-efficient, downstream SPF business
globally.
We remain steadfast in our commitment to maintain an
investment grade balance sheet and generate solid annual
free cash flow. We exited 2019 with a net debt to adjusted
EBITDA ratio of 1.7 times, which is now below 0.5 times
on a pro forma basis when adjusting for the sale of the
Chemical Intermediates and Surfactants businesses and
the net cash proceeds received on January 3, 2020.
Our free cash flow generation of $389 million in 2019
represented another solid year for cash flow generation
at Huntsman.
In addition to our downstream investments, we remained
committed to a balanced approach to capital allocation
in 2019 by repurchasing shares opportunistically and
supporting a competitive quarterly dividend. In 2019, we
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Huntsman Corporation | 2019 Annual Report
Overview of Business Divisions
2019
R E V E N U E
4 B u s i n e s s D i v i s i o n s
$6.8 billion
57%
11%
15%
17%
Polyurethanes
Polyurethanes is a leading global
producer of MDI-based polyure-
thanes focused on formulating
innovative, differentiated products
for key downstream markets
including energy-saving insulation,
light-weighting and performance
materials for automotive, comfort
foam for bedding and furniture,
protective coatings, adhesives,
and elastomers for footwear.
Textile Effects
Advanced Materials
Performance Products
Textile Effects is a major global
solutions provider of textile dyes,
textile chemicals and digital inks to
the textile industry that enhance
color and improve fabric perfor-
mance such as wrinkle resistance,
faster drying properties and the
ability to repel water and stains
in apparel, home and technical
textiles.
Advanced Materials provides
specialty epoxy, acrylic and
polyurethane-based polymer resin
systems and adhesive products,
which are replacing traditional
materials in aircraft, automobiles
and electrical power transmission.
These products are also used in
coatings, construction materials,
circuit boards and sports
equipment.
Performance Products manufac-
tures a wide variety of chemical
products that provide important
properties in everyday items
people want and need. The
primary product categories of
amines and maleic anhydride are
used in coating & adhesives, fuels
& lubricants, urethane catalysts,
composites, gas treating, and
epoxy curing.
2
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Huntsman Corporation | 2019 Annual Report
Sustainability at Huntsman: Innovating Toward a Circular Economy
HUNTSMAN IS REDUCING PLASTIC WASTE AND SAVING ENERGY THROUGH ITS WORLD-CLASS INSULATION PRODUCTS.
Huntsman does not manufacture polyethylene terephthalate (PET) plastic bottles, but we recognize their
impact on the environment and we are taking action.
WE’VE
RECYCLED
the equivalent of
5
billion
bottles
since
2015
to produce
approx.
MILLION lbs
290
131
MILLION kgs
OF
TEROL®
polyols
CONTAINING UP TO
RECYCLED
CONTENT
to insulate
More than
67,000
HOMES
In Houston, Texas, not far from Huntsman’s headquarters, we transform PET scrap
that may otherwise be destined for landfills or possibly find its way into the
oceans into TEROL® polyester polyols for use in energy-saving spray
polyurethane foam (SPF) and other polyurethane (PU) insulation products.
Not only do these products enable the conservation of energy, they also
significantly reduce the long-term cost of climate control in homes and
commercial buildings.
We transform
PET scrap that may
It has been estimated that approximately 50% of all energy is consumed in
the heating and cooling of buildings and industry.* When comparing the
energy requirements and savings of climate control in PU-insulated buildings
with non-insulated buildings, studies demonstrate that PU insulation saves
approximately 137 times the amount of energy used in its production over the
lifetime of a building.**
otherwise be destined for
landfills or possibly find its
way into the oceans.
Since 2015, Huntsman has recycled the equivalent of five billion PET bottles in the
manufacture of 290 million pounds of TEROL® polyols—enough to insulate more than 67,000
homes with the world’s most energy-efficient insulation products and thereby reducing the
environmental impact and carbon footprint of climate control.
WE’RE RISING TO MEET THE PLASTIC WASTE AND CLIMATE CONTROL CHALLENGES GLOBALLY.
We are expanding our capacity to provide PU insulation offerings for residential and commercial applications globally.
In 2018, we acquired Demilec, and in late 2019, we announced an agreement to acquire Icynene-Lapolla. Both
businesses are leading manufacturers and distributors of SPF insulation, both businesses are consumers of
TEROL® polyols, and both businesses focus on bio-preferred, renewable and recyclable products that reduce
energy consumption through highly efficient insulation properties.
In 2019, we opened a new PU systems house in Dubai, which is serving, among
other purposes, as a regional base for our SPF business. We have multiple ongoing
PU-focused capital investments in Asia, and in 2020, our production facility in
Taiwan will begin manufacturing TEROL® polyols with recycled PET for the
growing regional polyisocyanurate foam insulation market. And, with our
soon-to-be-combined SPF platform, we will further accelerate the domestic
and international use of these recycled, energy-saving insulation products.
Learn more about what we’re doing to create a more sustainable future.
See Huntsman’s 2018/2019 sustainability report, “Innovating Toward a
Circular Economy” and visit huntsman.com/PETrecycling.
*“Heating and cooling: facts and figures.” European Commission.
** “Environmental product declaration (EPD) for PU (PUR/PIR) thermal insulation boards and energy saving potential.” Federation of European Rigid Polyurethane
Foam Associations.
3
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Huntsman Corporation | 2019 Annual Report
Financial Highlights—2019 at a Glance
$ in millions, except per share amounts
Revenues
Gross profit
Interest expense, net
Net income
Adjusted net income(1)
Diluted adjusted net income per share(1)
Adjusted EBITDA(1)
Free cash flow(1)
Capital expenditures, net(2)
$ in millions
Total assets
Net debt(3)
57%
Polyurethanes
11%
Textile Effects
15%
Advanced
Materials
17%
Performance
Products
REVENUES
BY DIVISION(4)
55%
Polyurethanes
8%
Textile Effects
20%
Advanced
Materials
17%
Performance
Products
Year Ended December 31,
2019
$ 6,797
$ 1,382
$ 111
$ 598
$ 353
$ 1.53
$ 846
$ 389
$ 263
2018
2017
$ 7,604
$ 6,845
$ 1,764
$ 1,651
$ 115
$ 650
$ 642
$
$
$
165
741
519
$ 2.66
$ 2.13
$ 1,161
$ 1,040
$ 454
$ 243
$
$
472
231
December 31,
2019
$ 8,320
$ 1,864
2018
2017
$ 7,953
$ 10,244
$ 1,980
$ 1,817
ADJUSTED
EBITDA
BY DIVISION(4)
Note: The Chemical Intermediates and Surfactants businesses sold to Indorama Ventures on January 3, 2020 is treated as discontinued operations in all
periods shown.
(1) Reconciliations of non-GAAP measures to GAAP are provided on pages 41–46 of our annual report on Form 10-K for the year ended December 31, 2019,
as filed with the SEC on February 13, 2020.
(2) Net of reimbursements of $11 million, $8 million and $3 million in 2019, 2018 and 2017, respectively.
(3) Net debt calculated as total debt, excluding affiliates, less cash of $525 million, $340 million and $481 million in 2019, 2018 and 2017, respectively.
(4) Divisional allocation before Corporate and other unallocated items.
4
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Huntsman Corporation | 2019 Annual Report
Financial Review and Form 10-K
6
7
8
25
25
27
30
31
32
33
34
36
88
92
IBC
Definitions
Selected Financial Data
Management’s Discussion and Analysis of
Financial Condition and Results of Operations
Quantitative and Qualitative Disclosures about Market Risk
Controls and Procedures
Reports of Independent Registered Public Accounting Firm
Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Comprehensive Income
Consolidated Statements of Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
Market for Registrant’s Common Equity, Related Stockholder
Matters and Issuer Purchases of Equity Securities
Directors & Officers
Corporate Information
Each capitalized term used without definition in this report has the meaning specified in the Annual Report on
Form 10-K for the year ended December 31, 2019, which was filed with the Securities and Exchange Commission on
February 13, 2020.
DEFINITIONS
6
SELECTED FINANCIAL DATA
The selected historical financial data set forth below presents our historical financial data as of and for the dates
and periods indicated. You should read the selected financial data in conjunction with “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and accompanying
notes.
2019
Year ended December 31,
2017
(in millions, except per share amounts)
2016
2018
2015
Statements of Operations Data:
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,797 $ 7,604 $ 6,845 $ 6,146 $ 6,674
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,382 1,764
1,651 1,321 1,430
Restructuring, impairment and plant closing (credits) costs . . . .
74
(7)
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
468
827
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . .
271
689
(145)
(39)
Income (loss) from discontinued operations, net of tax(1) . . . . .
126
650
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(33)
(313)
Net income attributable to noncontrolling interests . . . . . . . . . . .
Net income attributable to Huntsman Corporation . . . . . . . . . . .
93
337
Basic income (loss) per common share:
Income from continuing operations attributable to Huntsman
19
729
511
230
741
(105)
636
(41)
469
429
169
598
(36)
562
31
516
271
86
357
(31)
326
Corporation common stockholders . . . . . . . . . . . . . . . . . . . . . . $ 1.72 $ 2.55 $
1.71 $ 1.02 $ 0.98
Income (loss) from discontinued operations attributable to
Huntsman Corporation common stockholders, net of tax(1) . .
0.74 (1.13)
0.96
0.36 (0.60)
Net income attributable to Huntsman Corporation common
stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2.46 $ 1.42 $
2.67 $ 1.38 $ 0.38
Diluted income (loss) per common share:
Income from continuing operations attributable to Huntsman
Corporation common stockholders . . . . . . . . . . . . . . . . . . . . . . $ 1.70 $ 2.52 $
1.66 $ 1.00 $ 0.97
Income (loss) from discontinued operations attributable to
Huntsman Corporation common stockholders, net of tax(1) . .
0.74 (1.13)
0.95
0.36 (0.59)
Net income attributable to Huntsman Corporation common
stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2.44 $ 1.39 $
2.61 $ 1.36 $ 0.38
Other Data:
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Dividends per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Balance Sheet Data (at period end):
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 8,320 $ 7,953 $ 10,244 $ 9,189 $ 9,820
Total debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,389 2,320
2,298 4,173 4,770
6,873 7,722 8,191
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,496 5,204
243 $ 238
0.50
0.50
270 $
0.65
255 $
0.65
236 $
0.50
(1) Discontinued operations include our chemical intermediates businesses, which includes PO/MTBE, and our
surfactants businesses (collectively, our “Chemical Intermediates Businesses”), our Australian styrenics
operations and our North American polymers and base chemicals operations for all periods presented. In
addition, discontinued operations for the years ended December 31, 2018, 2017, 2016 and 2015 also include the
results of Venator Materials PLC (“Venator”). Beginning in the fourth quarter of 2018, Venator was no longer
accounted for as discontinued operations.
7
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
RECENT DEVELOPMENTS
Sale of Chemical Intermediates Businesses
On January 3, 2020, we completed the sale of our Chemical Intermediates Businesses to Indorama Ventures
Holdings L.P. (“Indorama”) in a transaction valued at approximately $2 billion, comprising a cash purchase price of
approximately $1.93 billion, which includes estimated adjustments to the purchase price for working capital, plus the
transfer of approximately $72 million in net underfunded pension and other post-employment benefit liabilities. The final
purchase price is subject to customary post-closing adjustments. The net after tax cash proceeds are expected to be
approximately $1.6 billion. For more information, see “Note 4. Discontinued Operations and Business Dispositions—
Sale of Chemical Intermediates Businesses” to our consolidated financial statements.
Icynene-Lapolla Acquisition
On December 5, 2019, we entered into an agreement with an affiliate of FFL Partners, LLC to acquire Icynene-
Lapolla, a leading North American manufacturer and distributor of spray polyurethane foam insulation systems for
residential and commercial applications. Icynene-Lapolla operates two manufacturing facilities located in Houston,
Texas and Mississauga, Ontario. Under terms of the agreement, we agreed to pay $350 million, subject to customary
closing adjustments, in an all-cash transaction to be funded from available liquidity. The transaction is expected to close
in the first quarter of 2020. The acquired business is expected to be integrated into our Polyurethanes segment.
Acquisition of Remaining Interest in Sasol-Huntsman Joint Venture
On September 30, 2019, we acquired from Sasol, our former joint venture partner, the 50% noncontrolling
interest that we did not own in the Sasol-Huntsman GmbH and Co. KG (“Sasol-Huntsman”) maleic anhydride joint
venture. The joint venture owned a manufacturing facility in Moers, Germany with capacity to produce 230 million
pounds of maleic anhydride. We paid Sasol $101 million, which included acquired cash, net of any debt. The purchase
price was funded from a new 364-day term loan facility (“the 2019 Term Loan”). See “Note 15. Debt—Direct and
Subsidiary Debt—Term Loan Credit Facility” to our consolidated financial statements.
8
RESULTS OF OPERATIONS
The following tables set forth our consolidated results of operations for the years ended December 31, 2019,
2018 and 2017 (dollars in millions, except per share amounts).
Percent Change
2019 vs 2018 2018 vs 2017
11%
12%
7%
8%
NM
(93)%
13%
(30)%
323%
NM
(94)%
300%
38%
125%
35%
NM
(12)%
(11)%
(7)%
(22)%
1%
486%
(100)%
(43)%
(3)%
(2)%
(71)%
667%
(38)%
(47)%
NM
(38)%
NM
(8)%
(88)%
(3)%
(100)%
NM
(59)%
6%
(31)%
198%
(30)%
89%
125%
(23)%
8%
(42)%
(27)%
12%
(7)%
(67)%
6%
9%
5%
183%
(18)%
7%
2019
December 31,
2018
2017
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,797 $ 7,604 $ 6,845
5,194
Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,651
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
875
Operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Restructuring, impairment and plant closing (credits) costs . . . . . . . . . . . .
19
28
Merger costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
729
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(165)
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
13
Equity in income of investment in unconsolidated affiliates . . . . . . . . . . .
—
Fair value adjustments to Venator investment . . . . . . . . . . . . . . . . . . . . . . .
(54)
Loss on early extinguishment of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8
Other income, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
531
Income from continuing operations before income taxes . . . . . . . . . . .
(20)
Income tax benefit (expense) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
511
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . .
230
Income (loss) from discontinued operations, net of tax . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
741
Reconciliation of net income to adjusted EBITDA:
Net income attributable to noncontrolling interests . . . . . . . . . . . . . . . . . .
Interest expense from continuing operations . . . . . . . . . . . . . . . . . . . . . . .
Interest expense from discontinued operations . . . . . . . . . . . . . . . . . . . . . .
Income tax (benefit) expense from continuing operations . . . . . . . . . . . . .
Income tax expense from discontinued operations . . . . . . . . . . . . . . . . . . .
Depreciation and amortization of continuing operations . . . . . . . . . . . . . . .
Depreciation and amortization of discontinued operations . . . . . . . . . . . . .
Other adjustments:
5,840
1,764
942
(7)
2
827
(115)
55
(62)
(3)
32
734
(45)
689
(39)
650
5,415
1,382
954
(41)
—
469
(111)
54
(18)
(23)
20
391
38
429
169
598
(105)
165
19
20
111
236
151
(313)
115
36
45
86
255
88
(36)
111
—
(38)
35
270
61
Business acquisition and integration expenses and purchase accounting
inventory adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Merger costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EBITDA from discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncontrolling interest of discontinued operations . . . . . . . . . . . . . . . . . .
Fair value adjustments to Venator investment . . . . . . . . . . . . . . . . . . . . .
Loss on early extinguishment of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Certain legal settlements and related expenses (income) . . . . . . . . . . . . .
Loss (gain) on sale of businesses/assets . . . . . . . . . . . . . . . . . . . . . . . . . .
Certain nonrecurring information technology project implementation
costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of pension and postretirement actuarial losses . . . . . . . . . .
Plant incident remediation costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. Tax Reform Act impact on noncontrolling interest . . . . . . . . . . . . . .
Restructuring, impairment and plant closing and transition (credits)
5
—
(265)
—
18
23
6
21
4
66
8
—
9
2
(171)
232
62
3
1
—
—
67
—
—
19
28
(511)
49
—
54
(11)
(9)
—
69
1
(6)
costs(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
19
Adjusted EBITDA(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 846 $ 1,161 $ 1,040
(41)
(6)
Net cash provided by operating activities from continuing operations . . . . $ 656 $ 704 $ 672
(217)
Net cash used in investing activities from continuing operations . . . . . . . .
(519)
Net cash used in financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(234)
Capital expenditures from continuing operations . . . . . . . . . . . . . . . . . . . .
(615)
(424)
(251)
(201)
(450)
(274)
9
Reconciliation of net income to adjusted net income
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income attributable to noncontrolling interests . . . . . . . . . . . . .
Business acquisition and integration expenses and purchase
$ 598
(36)
$ 650
(313)
$ 741
(105)
Year ended
December 31, 2019
Tax
and
other(3)
Net
Gross
Year ended
December 31, 2018
Tax
and
other(3)
Gross
Net
Year ended
December 31, 2017
Tax
and
other(3)
Net
Gross
accounting inventory adjustments . . . . . . . . . . . . . . . . . . . . . . . .
$
—
Merger costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income from discontinued operations(5) . . . . . . . . . . . . . . . . . . . . (265)
—
Noncontrolling interest of discontinued operations . . . . . . . . . . . . .
18
Fair value adjustments to Venator investment . . . . . . . . . . . . . . . . .
23
Loss on early extinguishment of debt . . . . . . . . . . . . . . . . . . . . . . .
6
Certain legal settlements and related expenses (income) . . . . . . . . .
Loss (gain) on sale of businesses/assets . . . . . . . . . . . . . . . . . . . . .
21
Certain nonrecurring information technology project
5 $ —
5 $
—
9 $
2
(169) (171)
232
62
3
1
—
—
18
18
5
16
(3)
—
210
—
—
(1)
(1)
—
6 $ 19 $ (5)
2
28 (10)
39 (511) 281
49
232
—
—
—
62
54 (19)
2
(11)
—
4
—
(9)
—
14
18
(230)
49
—
35
(7)
(9)
—
96
—
—
(5)
(1)
(5)
implementation costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of pension and postretirement actuarial losses . . . . . .
Significant activities related to deferred tax assets and liabilities(4) .
U.S. Tax Reform Act impact on income tax expense . . . . . . . . . . .
U.S. Tax Reform Act impact on noncontrolling interest . . . . . . . . .
Plant incident remediation costs . . . . . . . . . . . . . . . . . . . . . . . . . . .
Restructuring, impairment and plant closing and transition
(credits) costs(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Adjusted net income(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1)
4
66
(16)
— (128)
(1)
—
—
—
(2)
8
3
50
(128)
(1)
—
6
—
67
—
—
—
—
—
(13)
(119)
32
—
—
—
54
(119)
32
—
—
—
—
69 (15)
—
—
— (52)
—
(6)
—
1
—
54
—
(52)
(6)
1
(41)
9
(32)
(6)
1
(5)
19
$ 353
$ 642
Weighted average shares-basic . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted average shares-diluted . . . . . . . . . . . . . . . . . . . . . . . . . .
228.9
230.6
238.1
241.6
(3)
16
$ 519
238.4
243.9
$ 1.71
0.96
$ 2.67
$ 1.66
0.95
$ 2.61
$ 1.72
0.74
$ 2.46
$ 1.70
0.74
$ 2.44
$ 2.55
(1.13)
$ 1.42
$ 2.52
(1.13)
$ 1.39
$ 1.53
$ 2.66
$ 2.13
$ 656
(274)
7
—
$ 389
$
704
(251)
(1)
2
$ 454
$ 672
(234)
6
28
$ 472
Basic net income (loss) attributable to Huntsman
Corporation per share:
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . .
Income (loss) from discontinued operations . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Diluted net income (loss) attributable to Huntsman
Corporation per share:
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . .
Income (loss) from discontinued operations . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other non-GAAP measures:
Diluted adjusted net income per share(1) . . . . . . . . . . . . . . . . . . . .
Net cash provided by operating activities from continuing
operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Capital expenditures from continuing operations . . . . . . . . . . . . . .
All other investing activities from continuing operations,
excluding acquisition and disposition activities . . . . . . . . . . . . . .
Non-recurring merger costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Free cash flow from continuing operations(1) . . . . . . . . . . . . . . . . .
NM—Not meaningful
(1) See “—Non-GAAP Financial Measures.”
(2) Includes costs associated with transition activities relating to the migration of our information system data centers
and the transition of our Textile Effects segment’s production from Basel, Switzerland to a tolling facility. These
transition costs were included in either selling, general and administrative expenses or cost of sales on our
consolidated statements of operations.
(3) The income tax impacts, if any, of each adjusting item represent a ratable allocation of the total difference between
the unadjusted tax expense and the total adjusted tax expense, computed without consideration of any adjusting
items using a with and without approach.
(4) During the year ended December 31, 2019, we recorded $153 million of tax benefit relating to the outside basis
difference in our investment in Venator, we recorded $18 million of tax benefit relating to realized tax losses on our
remaining interest in Venator, we established $11 million of significant income tax valuation allowance in Australia
10
and we recorded $32 million of deferred tax expense due to the reduction of tax rates in Switzerland. During the
year ended December 31, 2018, we released $119 million of significant income tax valuation allowances in
Switzerland, the U.K. and Luxembourg. We eliminated the effect of these significant changes in tax valuation
allowances and deferred tax assets and liabilities from our presentation of adjusted net income to allow investors to
better compare our ongoing financial performance from period to period.
(5) In addition to income tax impacts, this adjusting item is also impacted by depreciation and amortization expense and
interest expense.
Non-GAAP Financial Measures
Our consolidated financial statements are prepared in accordance with generally accepted accounting principles
in the U.S. (“GAAP” or “U.S. GAAP”), which we supplement with certain non-GAAP financial information. These non-
GAAP measures should not be considered in isolation or as a substitute for the related GAAP measures, and other
companies may define such measures differently. We encourage investors to review our financial statements and the
reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures in their
entirety and not to rely on any single financial measure. These non-GAAP measures exclude the impact of certain
expenses that we do not believe are indicative of our core operating results.
Adjusted EBITDA
Our management uses adjusted EBITDA to assess financial performance. Adjusted EBITDA is defined as net
income of Huntsman Corporation before interest, income tax, depreciation and amortization, net income attributable to
noncontrolling interests and certain Corporate and other items, as well as eliminating the following adjustments:
(a) business acquisition and integration expenses and purchase accounting inventory adjustments; (b) merger costs;
(c) EBITDA from discontinued operations; (d) noncontrolling interest of discontinued operations; (e) fair value
adjustments to Venator investment; (f) loss on early extinguishment of debt; (g) certain legal settlements and related
expenses (income); (h) gain on sale of businesses/assets; (i) certain nonrecurring information technology project
implementation costs; (j) amortization of pension and postretirement actuarial losses; (k) plant incident remediation
costs; (l) U.S. Tax Cuts and Jobs Act (“U.S. Tax Reform Act”) impact on noncontrolling interest; and (m) restructuring,
impairment and plant closing and transition (credits) costs. We believe that net income of Huntsman Corporation is the
performance measure calculated and presented in accordance with U.S. GAAP that is most directly comparable to
adjusted EBITDA.
We believe adjusted EBITDA is useful to investors in assessing the businesses’ ongoing financial performance
and provides improved comparability between periods through the exclusion of certain items that management believes
are not indicative of the businesses’ operational profitability and that may obscure underlying business results and trends.
However, this measure should not be considered in isolation or viewed as a substitute for net income of Huntsman
Corporation or other measures of performance determined in accordance with U.S. GAAP. Moreover, adjusted EBITDA
as used herein is not necessarily comparable to other similarly titled measures of other companies due to potential
inconsistencies in the methods of calculation. Our management believes this measure is useful to compare general
operating performance from period to period and to make certain related management decisions. Adjusted EBITDA is
also used by securities analysts, lenders and others in their evaluation of different companies because it excludes certain
items that can vary widely across different industries or among companies within the same industry. For example,
interest expense can be highly dependent on a company’s capital structure, debt levels and credit ratings. Therefore, the
impact of interest expense on earnings can vary significantly among companies. In addition, the tax positions of
companies can vary because of their differing abilities to take advantage of tax benefits and because of the tax policies of
the various jurisdictions in which they operate. As a result, effective tax rates and tax expense can vary considerably
among companies. Finally, companies employ productive assets of different ages and utilize different methods of
acquiring and depreciating such assets. This can result in considerable variability in the relative costs of productive assets
and the depreciation and amortization expense among companies.
Nevertheless, our management recognizes that there are material limitations associated with the use of adjusted
EBITDA in the evaluation of our Company as compared to net income of Huntsman Corporation, which reflects overall
financial performance. For example, we have borrowed money in order to finance our operations and interest expense is
a necessary element of our costs and ability to generate revenue.
11
Our management compensates for the limitations of using adjusted EBITDA by using this measure to
supplement U.S. GAAP results to provide a more complete understanding of the factors and trends affecting the business
rather than U.S. GAAP results alone.
Adjusted Net Income
Adjusted net income is computed by eliminating the after tax amounts related to the following from net income
attributable to Huntsman Corporation: (a) business acquisition and integration expenses and purchase accounting
inventory adjustments; (b) merger costs; (c) loss (income) from discontinued operations; (d) noncontrolling interest of
discontinued operations; (e) fair value adjustments to Venator investment; (f) loss on early extinguishment of debt;
(g) certain legal settlements and related (income) expenses; (h) gain on sale of businesses/assets; (i) certain nonrecurring
information technology project implementation costs; (j) amortization of pension and postretirement actuarial losses;
(k) significant activities related to deferred tax assets and liabilities; (l) U.S. Tax Reform Act impact on income tax
expense; (m) U.S. Tax Reform Act impact on noncontrolling interest; (n) plant incident remediation costs; and
(o) restructuring, impairment and plant closing and transition (credits) costs. Basic adjusted net income per share
excludes dilution and is computed by dividing adjusted net income by the weighted average number of shares
outstanding during the period. Adjusted diluted net income per share reflects all potential dilutive common shares
outstanding during the period and is computed by dividing adjusted net income by the weighted average number of
shares outstanding during the period increased by the number of additional shares that would have been outstanding as
dilutive securities. Adjusted net income and adjusted net income per share amounts are presented solely as supplemental
information.
Free Cash Flow
Management internally uses a free cash flow measure: (a) to evaluate our liquidity, (b) evaluate strategic
investments, (c) plan stock buyback and dividend levels, and (d) evaluate our ability to incur and service debt. Free cash
flow is not a defined term under U.S. GAAP, and it should not be inferred that the entire free cash flow amount is
available for discretionary expenditures. The Company defines free cash flow as cash flows provided by operating
activities from continuing operations and used in investing activities from continuing operations, including non-recurring
merger costs. Free cash flow as used herein is not necessarily comparable to other similarly titled measures of other
companies due to potential inconsistencies in the method of calculation. Free cash flow is typically derived directly from
the Company’s consolidated statement of cash flows; however, it may be adjusted for items that affect comparability
between periods.
Adjusted Effective Tax Rate
We believe that the effective tax rate of Huntsman Corporation is the performance measure calculated and
presented in accordance with U.S. GAAP that is most directly comparable to adjusted effective tax rate. We believe our
adjusted effective tax rate provides improved comparability between periods through the exclusion of certain items that
management believes are not indicative of the businesses’ operational profitability and that may obscure underlying
business results and trends. We do not provide reconciliations for adjusted effective tax rate on a forward-looking basis
because we are unable to provide a meaningful or accurate calculation or estimation of reconciling items and the
information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing
and amount of certain items, such as business acquisition and integration expenses, merger costs, certain legal and other
settlements and related costs, gains on sale of business/assets, and amortization of pension and postretirement actuarial
losses. Each of such adjustments has not yet occurred, is out of our control and/or cannot be reasonably predicted. For
the same reasons, we are unable to address the probable significance of the unavailable information.
Year Ended December 31, 2019 Compared with Year Ended December 31, 2018
As discussed in “Note 4. Discontinued Operations and Business Dispositions—Sale of Chemical Intermediates
Businesses” and “Note 4. Discontinued Operations and Business Dispositions—Separation and Deconsolidation of
Venator” to our consolidated financial statements, the results from continuing operations for all periods presented
exclude the results of our Chemical Intermediates Businesses and the results of our former polymers, base chemicals and
12
Australian styrenics businesses for all periods presented as well as the results of Venator for 2018. The increase of $225
million in net income attributable to Huntsman Corporation was the result of the following items:
• Revenues for the year ended December 31, 2019 decreased by $807 million, or 11%, as compared with the
2018 period. The decrease was primarily due to lower average selling prices in all our segments, except for
our Textile Effects segment, and lower sales volumes in all our segments, except for our Polyurethanes
segment. See “—Segment Analysis” below.
• Our gross profit for the year ended December 31, 2019 decreased by $382 million, or 22%, as compared
with the 2018 period. The decrease resulted from lower gross margins in all our segments. See “—Segment
Analysis” below.
• Our operating expenses for the year ended December 31, 2019 increased by $12 million, or 1%, as
compared with the 2018 period, primarily related to an increase in divestiture related costs, partially offset
by the impact of translating foreign currency amounts to the U.S. dollar.
• Restructuring, impairment and plant closing (credits) costs for the year ended December 31, 2019 was a
credit of $41 million compared to a credit of $7 million in the 2018 period. For more information on
restructuring activities, see “Note 13. Restructuring, Impairment and Plant Closing (Credits) Costs” to our
consolidated financial statements.
• We recorded a loss of $18 million in fair value adjustments to our investment in Venator for the year ended
December 2019 compared to a loss of $62 million in 2018. See “Note 4. Discontinued Operations and
Business Dispositions—Separation and Deconsolidation of Venator” to our consolidated financial
statements.
• Loss on early extinguishment of debt for the year ended December 31, 2019 increased to $23 million from
$3 million in the 2018 period in relation to the early repayment in full of our 4.875% senior notes due 2020
(“2020 Senior Notes”) in the first quarter of 2019. See “Note. 15. Debt—Notes” to our consolidated
financial statements.
• Our other income, net for the year ended December 31, 2019 decreased by $12 million as compared with
the 2018 period, primarily attributable to higher pension-related credits in the 2018 period.
• Our income tax benefit for the year ended December 31, 2019 increased to $38 million from an expense of
$45 million in the 2018 period. The increase in tax benefit was primarily due to the decrease in pretax
income along with discrete items in each period. In 2019, discrete items include tax benefits related to
built-in capital losses and realized tax losses both on our remaining interest in Venator, partially offset by
tax expense related to the establishment of a valuation allowance in Australia and the change in tax rate in
Switzerland. In 2018, discrete items include tax benefits related to the release of valuation allowances in
Switzerland, Luxembourg and the U.K., partially offset by additional provisional deemed repatriation
transition tax. Our income tax expense is significantly affected by the mix of income and losses in the tax
jurisdictions in which we operate, as impacted by the presence of valuation allowances in certain tax
jurisdictions. For further information concerning income taxes, see “Note 20. Income Taxes” to our
consolidated financial statements.
13
Segment Analysis
Year Ended December 31, 2019 Compared to Year Ended December 31, 2018
Year ended December 31,
(Dollars in millions)
Revenues
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,911 $ 4,282
1,301
Performance Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,116
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
824
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate and eliminations . . . . . . . . . . . . . . . . . . . . . . . . . .
81
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,797 $ 7,604
1,158
1,044
763
(79)
2019
2018
Segment adjusted EBITDA(1)
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Performance Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
809
548 $
197
168
225
201
101
84
(155)
(171)
846 $ 1,161
NM—Not meaningful
Percent
Change
Favorable
(Unfavorable)
(9)%
(11)%
(6)%
(7)%
NM
(11)%
(32)%
(15)%
(11)%
(17)%
9%
(27)%
(1) For more information, including reconciliation of segment adjusted EBITDA to net income
of Huntsman Corporation, see “Note 27. Operating Segment Information” to our
consolidated financial statements.
Year ended December 31, 2019 vs 2018
Average Selling Price(1)
Local
Mix &
Currency Translation Impact Other
Foreign Currency
Sales
Volumes(2)
Period-Over-Period (Decrease) Increase
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Performance Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(13)%
(2)%
2%
4%
(2)%
(2)%
(3)%
(3)%
1%
1%
2%
—
5%
(8)%
(7)%
(8)%
Fourth Quarter 2019 vs Third Quarter 2019
Average Selling Price(1)
Local
Mix &
Currency Translation Impact Other
Foreign Currency
Sales
Volumes(2)
Period-Over-Period (Decrease) Increase
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Performance Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3)%
(4)%
1%
(1)%
(1)%
(1)%
(1)%
(1)%
2%
3%
—
1%
1%
1%
(6)%
2%
(1) Excludes revenues from tolling arrangements, byproducts and raw materials.
(2) Excludes sales volumes of byproducts and raw materials.
Polyurethanes
The decrease in revenues in our Polyurethanes segment for 2019 compared to 2018 was due to lower MDI
average selling prices, partially offset by higher MDI sales volumes. MDI average selling prices decreased primarily due
to a decline in component MDI selling prices in China and Europe. MDI sales volumes increased primarily due to the
14
start-up of our new Chinese MDI facility in the third quarter of 2018. The decrease in segment adjusted EBITDA was
primarily due to lower MDI margins driven by lower MDI pricing, partially offset by higher MDI sales volumes.
Performance Products
The decrease in revenues in our Performance Products segment for 2019 compared to 2018 was due to lower
sales volumes and lower average selling prices. Sales volumes decreased primarily due to weakened market conditions.
Average selling prices decreased primarily due to lower raw material costs and weakened market conditions. The
decrease in segment adjusted EBITDA was primarily due to lower sales volumes and lower margins, primarily in our
ethyleneamines and maleic anhydride businesses, partially offset by higher margins in our performance amines business.
Advanced Materials
The decrease in revenues in our Advanced Materials segment for 2019 compared to 2018 was due to lower sales
volumes and lower average selling prices. Sales volumes decreased primarily due to lower sales volumes in our
industrial, power and automotive related markets, partially offset by favorable product mix effect from sales volumes in
our aerospace components market. Average selling prices decreased primarily due to the impact of a stronger U.S. dollar
against major international currencies, partially offset by higher local currency selling prices. The decrease in segment
adjusted EBITDA was primarily due to lower sales volumes, higher raw material and fixed costs and the impact of a
stronger U.S. dollar against major international currencies.
Textile Effects
The decrease in revenues in our Textile Effects segment for 2019 compared to 2018 was due to lower sales
volumes, partially offset by higher average selling prices. Sales volumes decreased primarily due to lower demand
resulting from market uncertainties surrounding U.S. and China trade. Average selling prices increased in response to
higher raw material costs, partially offset by the impact of a stronger U.S. dollar against major international currencies.
The decrease in segment adjusted EBITDA was primarily due to lower sales volumes and higher raw materials costs,
partially offset by higher average selling prices and lower fixed costs.
Corporate and other
Corporate and other includes unallocated corporate overhead, unallocated foreign currency exchange gains and
losses, LIFO inventory valuation reserve adjustments, loss on early extinguishment of debt, unallocated restructuring,
impairment and plant closing costs, nonoperating income and expense and gains and losses on the disposition of
corporate assets. For 2019, adjusted EBITDA from Corporate and other increased by $16 million to a loss of $155
million from a loss of $171 million for 2018. The increase in adjusted EBITDA from Corporate and other resulted
primarily from a benefit from a LIFO inventory reserve adjustment and a decrease in corporate overhead costs, partially
offset by an increase in unallocated foreign currency exchange loss.
Year Ended December 31, 2018 Compared with Year Ended December 31, 2017
As discussed in “Note 4. Discontinued Operations and Business Dispositions—Sale of Chemical Intermediates
Businesses” and “Note 4. Discontinued Operations and Business Dispositions—Separation and Deconsolidation of
Venator” to our consolidated financial statements, the results from continuing operations for all periods presented
exclude the results of our Chemical Intermediates Businesses, the results of Venator and the results of our former
polymers, base chemicals and Australian styrenics businesses for all periods presented. The decrease of $299 million in
net income attributable to Huntsman Corporation was the result of the following items:
• Revenues for the year ended December 31, 2018 increased by $759 million, or 11%, as compared with the
2017 period. The increase was primarily due to higher average selling prices in all our segments and higher
sales volumes in our Polyurethanes and Performance Products segments. See “—Segment Analysis” below.
• Our gross profit for the year ended December 31, 2018 increased by $113 million, or 7%, as compared with
the 2017 period. The increase resulted from higher gross margins in all our segments. See “—Segment
Analysis” below.
15
• Our operating expenses for the year ended December 31, 2018 increased by $67 million, or 8%, as
compared with the 2017 period, primarily related to an increase in selling, general and administrative
expenses and research and development costs.
• Restructuring, impairment and plant closing (credits) costs for the year ended December 31, 2018 was a
credit of $7 million compared to a cost of $19 million in the 2017 period. For more information on
restructuring activities, see “Note 13. Restructuring, Impairment and Plant Closing Costs” to our
consolidated financial statements.
• During 2018 and 2017, we incurred $2 million and $28 million, respectively, in merger-related costs
related to the terminated merger between Huntsman and Clariant Ltd.
• Our interest expense for the year ended December 31, 2018 decreased by $50 million, or 30%, as compared
with the 2017 period. The decrease was due to the early repayments on our term loans during the second
half of 2017.
• Equity in income of investment in unconsolidated affiliates for the year ended December 31, 2018 was $55
million compared to $13 million in the 2017 period. The increase was primarily attributable to the
PO/MTBE joint venture with Sinopec, of which we hold a 49% interest, which began commercial
operations during the second half of 2017.
• We elected the fair value option to account for our equity method investment in Venator post
deconsolidation. Accordingly, in December 2018, we recorded a pretax loss of $57 million to record our
equity method investment in Venator at fair value. This loss was recorded in “Fair value adjustments to
Venator investment” in the accompanying statements of operations. Furthermore, in connection with the
December 3, 2018 sale of Venator shares to Bank of America N.A., we recorded a forward swap. At
December 31, 2018, we recorded a loss of $5 million in “Fair value adjustments to Venator investment” in
the accompanying statements of operations to record the forward swap at fair value. Under the fair value
option to account for our equity method investment in Venator, amounts recorded in “Fair value
adjustments to Venator investment” could fluctuate depending upon the change in market value of Venator
common stock.
• Loss on early extinguishment of debt for the year ended December 31, 2018 decreased to $3 million from
$54 million in the 2017 period. During the year ended December 31, 2017, we recorded a loss on early
extinguishment of debt of $49 million related to early repayments on our term loans.
• Our other income, net for the year ended December 31, 2018 increased by $24 million as compared with
the 2017 period, primarily attributable to higher pension-related credits in the 2018 period.
• Our income tax expense for the year ended December 31, 2018 increased to $45 million from $20 million
in the 2017 period. The increase in tax expense was primarily due to the increase in pre-tax income and the
additional finalized impact of the U.S. Tax Reform Act, resulting in an additional net $32 million tax
expense, which is partially offset by the release of valuation allowances in Switzerland, the U.K. and
Luxembourg. Our income tax expense is significantly affected by the mix of income and losses in the tax
jurisdictions in which we operate, as impacted by the presence of valuation allowances in certain tax
jurisdictions. For further information concerning income taxes, see “Note 20. Income Taxes” to our
consolidated financial statements.
16
Segment Analysis
Year Ended December 31, 2018 Compared to Year Ended December 31, 2017
December 31,
2018
2017
Percent
Change
Favorable
(Unfavorable)
Revenues
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,282 $ 3,764
1,156
Performance Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,301
1,040
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,116
776
824
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate and eliminations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
109
81
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 7,604 $ 6,845
Segment adjusted EBITDA(1)
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
776
155
Performance Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
219
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
83
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(193)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,161 $ 1,040
809 $
197
225
101
(171)
14%
13%
7%
6%
NM
11%
4%
27%
3%
22%
11%
12%
NM—Not meaningful
(1) For more information, including reconciliation of segment adjusted EBITDA to net income of Huntsman
Corporation, see “Note 27. Operating Segment Information” to our consolidated financial statements.
Year ended December 31, 2018 vs 2017
Average Selling Price(1)
Local
Mix &
Currency Translation Impact Other
Foreign Currency
Sales
Volumes(2)
Period-Over-Period (Decrease) Increase
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Performance Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3%
15%
1%
2%
2%
1%
2%
—
1%
(5)%
4%
4%
8%
2%
—
—
(1) Excludes revenues from tolling arrangements, byproducts and raw materials.
(2) Excludes sales volumes of byproducts and raw materials.
Polyurethanes
The increase in revenues in our Polyurethanes segment for 2018 compared to 2017 was due to higher average
selling prices and higher sales volumes. MDI average selling prices increased in response to strong market conditions
during the first three quarters of 2018. MDI sales volumes increased due to increased demand across most major markets
as well as the start-up of our new Chinese MDI facility in 2018. The increase in segment adjusted EBITDA was
primarily due to higher MDI margins and volumes in 2018.
Performance Products
The increase in revenues in our Performance Products segment for 2018 compared to 2017 was due to higher
average selling prices and higher sales volumes. Average selling prices increased primarily due to strong market
conditions across several of our derivatives businesses and in response to higher raw material costs. Sales volumes
increased in our amines and maleic anhydride businesses. The increase in segment adjusted EBITDA was primarily due
to higher margins and the impact of hurricane related production outages during 2017.
17
Advanced Materials
The increase in revenues in our Advanced Materials segment for 2018 compared to 2017 was due to higher
average selling prices as sales volumes remained relatively unchanged. Average selling prices increased in response to
higher raw material costs and the impact of a weaker U.S. dollar against major international currencies. Sales volumes
remained relatively unchanged as higher sales volumes across most markets in our core specialty business were offset by
lower sales volumes in our commodity markets due to challenging industry conditions. The increase in segment adjusted
EBITDA was primarily due to higher specialty sales volumes, partially offset by higher raw material and fixed costs.
Textile Effects
The increase in revenues in our Textile Effects segment for 2018 compared to 2017 was due to higher average
selling prices as sales volumes remained relatively unchanged. Average selling prices increased in response to higher
raw material costs. Sales volumes remained relatively unchanged as higher sales volumes in our specialty business was
offset by lower sales volumes in our value business. The increase in segment adjusted EBITDA was primarily due to
higher average selling prices, partially offset by higher raw material costs and higher selling, general and administrative
costs.
Corporate and other
Corporate and other includes unallocated corporate overhead, unallocated foreign currency exchange gains and
losses, LIFO inventory valuation reserve adjustments, loss on early extinguishment of debt, unallocated restructuring,
impairment and plant closing costs, nonoperating income and expense and gains and losses on the disposition of
corporate assets. For 2018, adjusted EBITDA from Corporate and other increased by $22 million to a loss of $171
million from a loss of $193 million for 2017. The increase in segment adjusted EBITDA from Corporate and other
resulted primarily from a decrease in unallocated corporate overhead and a decrease in LIFO inventory reserves.
LIQUIDITY AND CAPITAL RESOURCES
Cash Flows Year Ended December 31, 2019 Compared with Year Ended December 31, 2018
Net cash provided by operating activities from continuing operations for 2019 and 2018 was $656 million and
$704 million, respectively. The decrease in net cash provided by operating activities from continuing operations during
2019 compared with 2018 was primarily attributable to decreased operating income as described in “—Results of
Operations” above, partially offset by a $74 million favorable variance in operating assets and liabilities for 2019 as
compared with 2018.
Net cash used in investing activities from continuing operations for 2019 and 2018 was $201 million and
$615 million, respectively. During 2019 and 2018, we paid $274 million and $251 million, respectively, for capital
expenditures. During 2018, we paid $366 million for the acquisition of a business, net of cash acquired. During 2019, we
received $49 million in proceeds from the sale of assets in connection with the closure of our Textile Effects facilities in
Basel, Switzerland. During 2019 and 2018, we received proceeds of $16 million and $3 million, respectively, from the
settlement of the December 3, 2018 sale of Venator ordinary shares to Bank of America N.A.
Net cash used in financing activities for 2019 and 2018 was $450 million and $424 million, respectively. The
increase in net cash used in financing activities was primarily due to increased repayments on our $1.2 billion senior
unsecured revolving credit facility (“2018 Revolving Credit Facility”) in the 2019 period, the repayment of our 2020
Senior Notes in the first quarter of 2019 and cash paid to acquire the 50% noncontrolling interest that we did not own in
the Sasol-Huntsman joint venture. The increase was partially offset by proceeds from the issuance of our 4.50% senior
notes due 2029 (“2029 Senior Notes”) in the first quarter of 2019, proceeds from the 2019 Term Loan in the third quarter
of 2019 and a decrease in our repurchase of shares of our common stock under the share repurchase program.
Free cash flow from continuing operations for 2019 and 2018 were proceeds of cash of $389 million and
$454 million, respectively. The reduction in free cash flow was attributable to the changes in cash flows from operating
and investing activities from continuing operations, excluding acquisition and disposition activities.
18
Cash Flows for Year Ended December 31, 2018 Compared to the Year Ended December 31, 2017
Net cash provided by operating activities from continuing operations for 2018 and 2017 was $704 million and
$672 million, respectively. The increase in net cash provided by operating activities from continuing operations during
2018 compared with 2017 was primarily attributable to increased operating income as described in “—Results of
Operations” above, partially offset by a $35 million unfavorable variance in operating assets and liabilities for 2018
compared with 2017.
Net cash used in investing activities from continuing operations for 2018 and 2017 was $615 million and
$217 million, respectively. During 2018 and 2017, we paid $251 million and $234 million, respectively, for capital
expenditures and paid $366 million and $14 million, respectively, for the acquisition of businesses, net of cash acquired.
For more information concerning business acquisitions, see “Note 3. Business Combinations and Acquisitions” to our
consolidated financial statements. During 2018 and 2017, we received proceeds of nil and $25 million, respectively,
from the sale of assets and received nil and $7 million, respectively, from the termination of cross-currency interest rate
contracts.
Net cash used in financing activities for 2018 and 2017 was $424 million and $519 million, respectively. The
decrease in net cash used in financing activities was primarily due to borrowings on our 2018 Revolving Credit Facility
and proceeds from the secondary offering of Venator in 2018 as well as net repayments of long-term debt in the 2017
period, partially offset by our repurchase of shares of our common stock under the share repurchase program and
increased dividends paid to common stockholders and noncontrolling interests in 2018 as well as proceeds from the IPO
of Venator in 2017.
Free cash flow from continuing operations for 2018 and 2017 were cash proceeds of $454 million and
$472 million, respectively. The reduction in free cash flow was attributable to the changes in cash flows from operating
and investing activities from continuing operations, excluding acquisition and disposition activities.
Changes in Financial Condition
The following information summarizes our working capital (dollars in millions):
December 31, December 31,
2019
2018
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts and notes receivable, net . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current assets held for sale(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current portion of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current liabilities held for sale(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Working capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
525 $
953
914
83
72
1,208
3,755
822
420
212
42
512
2,008
1,747 $
340 $
Increase Percent
(Decrease) Change
54%
185
(19)%
(230)
(9)%
(86)
43%
25
(73)
(50)%
976 421%
27%
797
4%
29
(77)
(15)%
116 121%
NM
287 128%
25%
397
30%
400
1,183
1,000
58
145
232
2,958
793
497
96
—
225
1,611
1,347 $
42
NM—Not meaningful
(1) The assets and liabilities held for sale are classified as current as of December 31, 2019 because we completed the
sale of our Chemical Intermediates Businesses on January 3, 2020. For more information, see “Note 4.
Discontinued Operations and Business Dispositions—Sale of Chemical Intermediates Businesses” to our
consolidated financial statements.
19
Our working capital increased by $400 million as a result of the net impact of the following significant changes:
• The increase in cash and cash equivalents of $185 million resulted from the matters identified on our
consolidated statements of cash flows.
• Accounts and notes receivable decreased by $230 million primarily due to lower revenues in the fourth
quarter of 2019 compared to the fourth quarter of 2018.
•
Inventories decreased by $86 million primarily due to lower inventory costs and volumes.
• Prepaid expenses increased by $25 million primarily due to higher prepaid insurance.
• Other current assets decreased by $73 million primarily due to lower bank acceptance drafts and lower
current income taxes receivable.
• Accrued liabilities decreased by $77 million primarily due to a decrease in current income taxes payable
and the payment of accrued compensation, partially offset by an increase in taxes other than income.
• Current portion of debt increased by $116 million primarily due to new borrowings under the 2019 Term
Loan in the third quarter of 2019, partially offset by increased repayments on our 2018 Revolving Credit
Facility.
• Current operating lease liabilities were $42 million as of December 31, 2019 as a result of the adoption of
the new lease standard on January 1, 2019.
DIRECT AND SUBSIDIARY DEBT
See “Note 15. Debt—Direct and Subsidiary Debt” to our consolidated financial statements.
Debt Issuance Costs
See “Note 15. Debt—Direct and Subsidiary Debt—Debt Issuance Costs” to our consolidated financial
statements.
Revolving Credit Facility
See “Note 15. Debt—Direct and Subsidiary Debt—Revolving Credit Facility” to our consolidated financial
statements.
Term Loan Credit Facility
See “Note 15. Debt—Direct and Subsidiary Debt—Term Loan Credit Facility” to our consolidated financial
statements.
A/R Programs
See “Note 15. Debt—Direct and Subsidiary Debt—A/R Programs” to our consolidated financial statements.
Notes
See “Note 15. Debt—Direct and Subsidiary Debt—Notes” to our consolidated financial statements.
Variable Interest Entity Debt
See “Note 15. Debt—Direct and Subsidiary Debt—Variable Interest Entity Debt” to our consolidated financial
statements.
20
COMPLIANCE WITH COVENANTS
See “Note 15. Debt—Compliance with Covenants” to our consolidated financial statements.
MATURITIES
See “Note 15. Debt—Maturities” to our consolidated financial statements.
SHORT-TERM AND LONG-TERM LIQUIDITY
We depend upon our cash, 2018 Revolving Credit Facility, U.S. accounts receivable securitization program
(“U.S. A/R Program”) and European accounts receivable securitization program (“EU A/R Program” and collectively
with the U.S. A/R Program, “A/R Programs”) and other debt instruments to provide liquidity for our operations and
working capital needs. As of December 31, 2019, we had $1,684 million of combined cash and unused borrowing
capacity, consisting of $525 million in cash, $1,153 million in availability under our 2018 Revolving Credit Facility and
$6 million in availability under our A/R Programs. Our liquidity can be significantly impacted by various factors. The
following matters had, or are expected to have, a significant impact on our liquidity:
• Cash proceeds from our accounts receivable and inventory, net of accounts payable, were approximately
$236 million for 2019, as reflected in our consolidated statements of cash flows. We expect volatility in our
working capital components to continue.
• During 2020, we expect to spend between approximately $300 million to $325 million on capital
expenditures for continuing operations, including spending of approximately $80 million on a new MDI
splitter in Geismar, Louisiana. We expect to fund spending on all capital expenditures with cash provided
by operations.
• During 2019, we made contributions to our pension and postretirement benefit plans of $92 million. During
2020, we expect to contribute an additional amount of approximately $88 million to these plans.
• On February 7, 2018 and on May 3, 2018, our Board of Directors authorized our Company to repurchase
up to an additional $950 million in shares of our common stock in addition to the $50 million remaining
under our September 2015 share repurchase authorization. Repurchases may be made through the open
market, including through accelerated share repurchase programs, or in privately negotiated transactions,
and repurchases may be commenced or suspended from time to time without prior notice. Shares of
common stock acquired through the repurchase program are held in treasury at cost. During 2019, we
repurchased 10,099,892 shares of our common stock for approximately $208 million, excluding
commissions, under the repurchase program. From January 1, 2020 through January 31, 2020, we
repurchased an additional 336,478 shares of our common stock for approximately $7 million, excluding
commissions.
• On December 3, 2018, we sold an aggregate of 4,334,389, or 4% of Venator ordinary shares to Bank of
America N.A. at a price determined based on the average of the daily volume weighted average price of the
ordinary shares over an agreed period. Over this agreed period, we received aggregate proceeds of $19
million, $16 million of which was received in the first quarter of 2019. The transaction allowed us to
deconsolidate Venator beginning in December 2018, and following this transaction, we retained
approximately 49% ownership in Venator. We elected the fair value option to account for our equity
method investment in Venator post deconsolidation. Accordingly, in 2019, we recorded a loss of $19
million to record our equity method investment in Venator at fair value. Under the fair value option to
account for our equity method investment in Venator, amounts recorded in “Fair value adjustments to
Venator investment” could fluctuate depending upon the change in market value of Venator common stock.
See “Note 4. Discontinued Operations and Business Dispositions—Separation and Deconsolidation of
Venator” to our consolidated financial statements.
• On March 13, 2019, we completed a $750 million offering of our 2029 Senior Notes. On March 27, 2019,
we applied the net proceeds of this offering to redeem in full $650 million in aggregate principal amount of
our 2020 Senior Notes and associated costs and accrued interest of $21 million and $12 million,
21
respectively. In addition, we recognized a loss on early extinguishment of debt of $23 million. See “Note
15. Debt—Direct and Subsidiary Debt—Notes” to our consolidated financial statements.
• On April 18, 2019, we entered into an Amended and Restated European Receivables Loan Agreement and
a Master Amendment No. 7 to the U.S. Receivables Loan Agreement to, among other things, extend the
respective scheduled termination dates to April 2022. See “Note 15. Debt—Direct and Subsidiary Debt—
A/R Programs” to our consolidated financial statements.
•
In September 2011, we initiated a restructuring program in our Textile Effects segment to close its
production facilities and business support offices in Basel, Switzerland. In July 2019, we sold the
production facilities and business support offices in Basel. Accordingly, during the third quarter of 2019,
we received proceeds of $49 million related to this sale and recognized a corresponding gain on disposal of
assets of $49 million.
• On January 3, 2020, we completed the sale of our Chemical Intermediates Businesses to Indorama in a
transaction valued at approximately $2 billion, comprising a cash purchase price of approximately $1.93
billion, which includes estimated adjustments to the purchase price for working capital, plus the transfer of
approximately $72 million in net underfunded pension and other post-employment benefit liabilities. The
final purchase price is subject to customary post-closing adjustments. The net after tax cash proceeds are
expected to be approximately $1.6 billion. We expect to use the net proceeds from this sale to: 1) invest in
complementary strategic acquisitions that develop our technology and product portfolio, 2) continue
investing in organic, internal opportunities, 3) prepay certain prepayable debt, and 4) continue to
repurchase shares opportunistically and pay a competitive dividend.
•
In connection with the January 3, 2020 sale of our Chemical Intermediates Businesses to Indorama, we
assigned Indorama an insurance claim related to damages we incurred from a recent fire at a neighboring
third-party property near the Port Neches, Texas site. We agreed with Indorama that we will receive the
first $50 million of the potential insurance recovery when and if paid. In addition, we agreed with Indorama
to cover certain reinstatement costs pertaining to our damaged assets at the third-party site. We currently do
not expect these costs to be material.
• On September 24, 2019, we entered into the 2019 Term Loan, pursuant to which we borrowed an aggregate
principal amount of $101 million. We used the net proceeds of the 2019 Term Loan to finance the
acquisition of the 50% noncontrolling interest that we did not own in the Sasol-Huntsman maleic anhydride
joint venture. Borrowings under the 2019 Term Loan will bear interest at an interest rate margin of
EURIBO Rate plus 0.75%. Unless earlier terminated or prepaid in accordance with the credit agreement
governing the 2019 Term Loan, the 2019 Term Loan will mature on September 22, 2020. The 2019 Term
Loan is subject to substantially the same terms and conditions as the 2018 Revolving Credit Facility.
• On September 30, 2019, we acquired from Sasol the 50% noncontrolling interest that we did not own in the
Sasol-Huntsman maleic anhydride joint venture. We paid Sasol $101 million, which included acquired
cash, net of any debt. The purchase price was funded from the 2019 Term Loan.
As of December 31, 2019, we had $212 million classified as current portion of debt, including $103 million on
our 2019 Term Loan, $40 million on borrowings of our 2018 Revolving Credit Facility, debt at our variable interest
entities of $36 million and certain other short-term facilities and scheduled amortization payments totaling $33 million.
Although we cannot provide assurances, we intend to renew, repay or extend the majority of these short-term facilities in
the next twelve months.
As of December 31, 2019, we had approximately $440 million of cash and cash equivalents, including restricted
cash, held by our foreign subsidiaries, including our variable interest entities. We intend to use cash held in our foreign
subsidiaries to fund our local operations. Nevertheless, we could repatriate cash as dividends and the repatriation of cash
as a dividend would generally not be subject to U.S. taxation as a result of the U.S. Tax Reform Act. However, such
repatriation may potentially be subject to limited foreign withholding taxes.
22
Contractual Obligations and Commercial Commitments
Our obligations under long-term debt (including the current portion), lease agreements and other contractual
commitments as of December 31, 2019 are summarized below (dollars in millions):
Long-term debt, including current portion . $ 212 $ 1,092 $
167
110
Interest(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating leases . . . . . . . . . . . . . . . . . . . . . .
81
42
1,656
Purchase commitments(2) . . . . . . . . . . . . . . 1,364
2021 - 2022 2023 - 2024 After 2024 Total
3 $ 1,082 $ 2,389
537
156
426
231
840 1,894 5,754
Total(3)(4). . . . . . . . . . . . . . . . . . . . . . . . . $ 1,728 $ 2,996 $ 1,019 $ 3,363 $ 9,106
104
72
2020
(1) Interest calculated using interest rates as of December 31, 2019 and contractual maturity dates assuming
no refinancing or extension of debt instruments.
(2) We have various purchase commitments extending through 2039 for materials, supplies and services
entered into in the ordinary course of business. Included in the purchase commitments table above are
contracts which require minimum volume purchases that extend beyond one year or are renewable
annually and have been renewed for 2018. Certain contracts allow for changes in minimum required
purchase volumes in the event of a temporary or permanent shutdown of a facility. To the extent the
contract requires a minimum notice period, such notice period has been included in the above table. The
contractual purchase price for substantially all of these contracts is variable based upon market prices,
subject to annual negotiations. We have estimated our contractual obligations by using the terms of our
current pricing for each contract. We also have a limited number of contracts which require a minimum
payment even if no volume is purchased. We believe that all of our purchase obligations will be utilized
in our normal operations. For the years ended December 31, 2019, 2018 and 2017, we made minimum
payments of $1 million, nil and nil, respectively, under such take or pay contracts without taking the
product.
(3) Totals do not include commitments pertaining to our pension and other postretirement obligations. Our
estimated future contributions to our pension and postretirement plans related to continuing operations
are as follows (dollars in millions):
Pension plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 83 $
Other postretirement obligations . . . . . . . . . . . . . . . . . . . .
5
5-Year
Average
2020 2021 - 2022 2023 - 2024 Annual
61
5
121 $
10
148 $
11
(4) The above table does not reflect expected tax payments and unrecognized tax benefits due to the
inability to make reasonably reliable estimates of the timing and amount of payments. Totals also do not
include installment obligations for the U.S. Tax Reform Act deemed repatriation transition tax of
approximately $44 million, to be paid $5 million in 2023 and $39 million after 2023. For additional
discussion on unrecognized tax benefits, see “Note 20. Income Taxes” to our consolidated financial
statements.
Off-Balance Sheet Arrangements
No off-balance sheet arrangements exist.
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS
For a discussion of restructuring plans and the costs involved, see “Note 13. Restructuring, Impairment and
Plant Closing Costs” to our consolidated financial statements.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
For a discussion of recently issued accounting pronouncements, see “Note 2. Summary of Significant
Accounting Policies—Recently Issued Accounting Pronouncements” to our consolidated financial statements.
23
CRITICAL ACCOUNTING POLICIES
The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires
management to make judgments, estimates and assumptions that affect the reported amounts in our consolidated
financial statements. Our significant accounting policies are summarized in “Note 2. Summary of Significant Accounting
Policies” to our consolidated financial statements. Summarized below are our critical accounting policies:
Income Taxes
We use the asset and liability method of accounting for income taxes. Deferred income taxes reflect the net tax
effects of temporary differences between the carrying amounts of assets and liabilities for financial and tax reporting
purposes. We evaluate deferred tax assets to determine whether it is more likely than not that they will be realized.
Valuation allowances are reviewed on a tax jurisdiction basis to analyze whether there is sufficient positive or negative
evidence to support a change in judgment about the realizability of the related deferred tax assets for each jurisdiction.
These conclusions require significant judgment. In evaluating the objective evidence that historical results provide, we
consider the cyclicality of businesses and cumulative income or losses during the applicable period. Cumulative losses
incurred over the period limits our ability to consider other subjective evidence, such as our projections of future taxable
income. Changes in expected future income in applicable jurisdictions could affect the realization of deferred tax assets
in those jurisdictions. As of December 31, 2019, we had total valuation allowances of $231 million. See “Note 20.
Income Taxes” to our consolidated financial statements for more information regarding our valuation allowances.
Employee Benefit Programs
We sponsor several contributory and non-contributory defined benefit plans, covering employees primarily in
the U.S., the U.K., The Netherlands, Belgium and Switzerland, but also covering employees in a number of other
countries. We fund the material plans through trust arrangements (or local equivalents) where the assets are held
separately from us. We also sponsor unfunded postretirement plans which provide medical and, in some cases, life
insurance benefits covering certain employees in the U.S. and Canada. Amounts recorded in our consolidated financial
statements are recorded based upon actuarial valuations performed by various independent actuaries. Inherent in these
valuations are numerous assumptions regarding expected long-term rates of return on plan assets, discount rates,
compensation increases, mortality rates and health care cost trends. These assumptions are described in “Note 19.
Employee Benefit Plans” to our consolidated financial statements.
Management, with the advice of actuaries, uses judgment to make assumptions on which our employee pension
and postretirement benefit plan obligations and expenses are based. The effect of a 1% change in three key assumptions
is summarized as follows (dollars in millions):
Statement of Balance Sheet
Operations(1) Impact(2)
Assumptions
Discount rate
—1% increase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
—1% decrease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected long-term rates of return on plan assets
—1% increase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—1% decrease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Rate of compensation increase
—1% increase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—1% decrease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(36) $
43
(482)
562
(26)
26
11
(11)
—
—
49
(56)
(1) Estimated increase (decrease) on 2019 net periodic benefit cost
(2) Estimated increase (decrease) on December 31, 2019 pension and postretirement liabilities and
accumulated other comprehensive loss
Contingent Loss Accruals
We are subject to legal proceedings and claims arising out of our business operations. We routinely assess the
likelihood of any adverse outcomes to these matters, as well as ranges of probable losses. A determination of the amount
24
of the reserves required, if any, for these contingencies is made after analysis of each known claim. We have an active
risk management program consisting of numerous insurance policies secured from many carriers. These policies often
provide coverage that is intended to minimize the financial impact, if any, of the legal proceedings. The required reserves
may change in the future due to new developments in each matter. For further information, see “Note 21. Commitments
and Contingencies—Legal Matters” to our consolidated financial statements.
Goodwill
We test our goodwill for impairment at least annually (at the beginning of the third quarter) and when events
and circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying
amount. Goodwill has been assigned to reporting units for purposes of impairment testing. Approximately 64% and 30%
of our goodwill balance relates to our MDI urethanes reporting unit and our Advanced Materials reporting unit,
respectively. The remaining goodwill relates to two other reporting units.
Fair value is estimated using the market approach, as well as the income approach based on discounted cash
flow projections. The estimated fair values of our reporting units are dependent on several significant assumptions
including, among others, market information, discount rates, operating results, earnings projections and anticipated
future cash flows.
We tested goodwill for impairment at the beginning of the third quarter of 2019 as part of the annual
impairment testing procedures and determined that no goodwill impairment existed. Our most recent fair value
determination resulted in an amount that exceeded the carrying amounts of all reporting units by a significant margin.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are exposed to market risks, such as changes in interest rates, foreign exchange rates and commodity prices.
From time to time, we enter into transactions, including transactions involving derivative instruments, to manage certain
of these exposures. We also hedge our net investment in certain European operations. Changes in the fair value of the
hedge in the net investment of certain European operations are recorded in accumulated other comprehensive loss.
INTEREST RATE RISKS
See “Note 16. Derivative Instruments and Hedging Activities—Interest Rate Risk” to our consolidated financial
statements.
FOREIGN EXCHANGE RATE RISK
See “Note 16. Derivative Instruments and Hedging Activities—Foreign Exchange Rate Risk” to our
consolidated financial statements.
COMMODITY PRICES RISK
See “Note 16. Derivative Instruments and Hedging Activities—Commodity Prices Risk” to our consolidated
financial statements.
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
CONTROLS AND PROCEDURES
Our management, with the participation of our chief executive officer and chief financial officer, has evaluated
the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the
Exchange Act) as of December 31, 2019. Based on this evaluation, our chief executive officer and chief financial officer
have concluded that, as of December 31, 2019, our disclosure controls and procedures were effective, in that they ensure
that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is
(1) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and
(2) accumulated and communicated to our management, including our chief executive officer and chief financial officer,
as appropriate to allow timely decisions regarding required disclosure.
25
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
No changes to our internal control over financial reporting occurred during the quarter ended December 31,
2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial
reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act).
MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Management is responsible for establishing and maintaining adequate internal control over financial reporting.
Our internal control framework and processes are designed to provide reasonable assurance to management and our
Board of Directors regarding the reliability of financial reporting and the preparation of our consolidated financial
statements in accordance with accounting principles generally accepted in the United States of America.
Our internal control over financial reporting includes those policies and procedures that:
•
•
•
•
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions
and dispositions of the assets of our Company;
provide reasonable assurance that transactions are recorded properly to allow for the preparation of
financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of our Company are being made only in accordance with authorizations of management and
Directors of our Company;
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or
disposition of our assets that could have a material effect on our consolidated financial statements; and
provide reasonable assurance as to the detection of fraud.
Because of its inherent limitations, a system of internal control over financial reporting can provide only
reasonable assurance and may not prevent or detect misstatements. Further, because of changing conditions,
effectiveness of internal control over financial reporting may vary over time.
Our management assessed the effectiveness of our internal control over financial reporting and concluded that,
as of December 31, 2019, such internal control is effective. In making this assessment, management used the criteria set
forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control—Integrated
Framework (2013).
Our independent registered public accounting firm, Deloitte & Touche LLP, with direct access to our Board of
Directors through our Audit Committee, have audited our consolidated financial statements prepared by us and have
issued attestation reports on internal control over financial reporting for our Company.
26
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of
Huntsman Corporation
Opinion on Internal Control over Financial Reporting
We have audited the internal control over financial reporting of Huntsman Corporation and subsidiaries (the “Company”) as of
December 31, 2019, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects,
effective internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control —
Integrated Framework (2013) issued by COSO.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated financial statements as of and for the year ended December 31, 2019 of the Company and our report dated
February 13, 2020, expressed an unqualified opinion on those financial statements and included an explanatory paragraph regarding
the Company’s adoption of a new accounting standard.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of
the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control
Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based
on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the
Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange
Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness
exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such
other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our
opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the
maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the
company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect
on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ DELOITTE & TOUCHE LLP
Houston, Texas
February 13, 2020
We have served as the Company’s auditor since 1984.
27
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of Huntsman Corporation
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Huntsman Corporation and subsidiaries (the
“Company”) as of December 31, 2019 and 2018, the related consolidated statements of operations, comprehensive
income (loss), equity, and cash flows for each of the three years in the period ended December 31, 2019, and the related
notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all
material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its
operations and its cash flows for each of the three years in the period ended December 31, 2019, in conformity with
accounting principles generally accepted in the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2019, based on criteria
established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of
the Treadway Commission and our report dated February 13, 2020, expressed an unqualified opinion on the Company’s
internal control over financial reporting.
Change in Accounting Principle
As discussed in Note 2 to the financial statements, effective January 1, 2019, the Company adopted the Financial
Accounting Standards Board Accounting Standards Update No. 2016-02, Leases (Topic 842).
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an
opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the
PCAOB and are required to be independent with respect to the Company in accordance with the US federal securities
laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the financial statements are free of material
misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material
misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those
risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the
financial statements. Our audits also included evaluating the accounting principles used and significant estimates made
by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits
provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements
that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or
disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or
complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial
statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate
opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Income Taxes—Realizability of Deferred Tax Assets—Refer to Notes 2 and 20 to the financial statements
Critical Audit Matter Description
The Company recognizes deferred income taxes for tax attributes and for differences between the financial statement and
tax carrying amounts of assets and liabilities at enacted statutory tax rates in effect for the years in which the deferred tax
liability or asset are expected to be settled or realized. A valuation allowance is provided to offset deferred tax assets if,
28
based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be
realized. The Company files tax returns in multiple jurisdictions with complex tax laws and regulations. Valuation
allowances are evaluated on a tax jurisdiction basis to analyze whether there is sufficient positive or negative evidence to
support a change in judgment about the realizability of the related deferred tax assets for each jurisdiction. In evaluating
the objective evidence that historical results provide, the Company considers the cyclicality of businesses and cumulative
income or losses during the applicable period. Cumulative losses incurred over the period limits the Company’s ability to
consider other subjective evidence such as taxable income for the future. The Company’s valuation allowances as of
December 31, 2019, were $231 million.
We identified management’s determination that it is not more likely than not that sufficient taxable income will be
generated in the future to realize some of its deferred tax assets as a critical audit matter because of the significant
judgments and estimates management makes related to future taxable income. This required a high degree of auditor
judgment and an increased extent of effort, including the need to involve our income tax specialists, when performing
audit procedures to evaluate the reasonableness of management’s estimates of future taxable income.
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to estimated future taxable income and the determination of whether it is more likely than
not that the deferred tax assets will be realized included the following, among others:
• We tested the effectiveness of controls over the valuation allowance for income taxes, including management’s
controls over the estimates of future taxable income and the determination of whether it is more likely than not that
the deferred tax assets will be realized.
• With the assistance of our income tax specialists, we considered the following sources of management’s estimated
future taxable income:
– Estimates of future taxable income
– Future reversals of existing temporary differences
– Taxable income in historical periods (when carryback was permitted)
• We tested the reasonableness of management’s estimates of future taxable income by comparing the estimates to:
– Historical taxable income
–
Internal communications to management and the Board of Directors
– Forecasted information included in Company press releases as well as in analyst and industry reports for the
Company and certain of its peer companies
• We evaluated whether the taxable income in prior carryback years was of the appropriate character and available
under the tax law.
• We evaluated the reasonableness of the methods, assumptions, and judgments used by management to determine
whether a valuation allowance was necessary.
/s/ DELOITTE & TOUCHE LLP
Houston, Texas
February 13, 2020
We have served as the Company’s auditor since 1984.
29
HUNTSMAN CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Millions, Except Share Amounts)
ASSETS
Current assets:
Cash and cash equivalents(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Accounts and notes receivable (net of allowance for doubtful accounts of $19 and $21, respectively),
525 $
340
December 31, December 31,
2019
2018
($221 and $341 pledged as collateral, respectively)(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts receivable from affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Inventories(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current assets(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current assets held for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Property, plant and equipment, net(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment in unconsolidated affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intangible assets, net(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Notes receivable from affiliate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease right-of-use assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent assets(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent assets held for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Accounts payable to affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued liabilities(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current portion of debt(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current operating lease liabilities(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current liabilities held for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term debt(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent operating lease liabilities(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent liabilities(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent liabilities held for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commitments and contingencies (Notes 21 and 22)
Equity
Huntsman Corporation stockholders’ equity:
Common stock $0.01 par value, 1,200,000,000 shares authorized, 257,405,496 and 256,006,849 shares
issued and 224,295,868 and 232,994,172 shares outstanding, respectively. . . . . . . . . . . . . . . . . . . . . . . . . .
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Treasury stock, 33,112,572 and 23,012,680 shares, respectively . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unearned stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accumulated other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total Huntsman Corporation stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncontrolling interests in subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total liabilities and equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
940
13
914
83
72
1,208
3,755
2,383
535
197
276
292
34
396
452
—
8,320 $
765 $
57
420
212
42
512
2,008
2,177
29
384
898
—
5,496
3
4,008
(635)
(17)
690
(1,362)
2,687
137
2,824
8,320 $
1,165
18
1,000
58
145
232
2,958
2,353
526
213
275
324
34
—
393
877
7,953
761
32
497
96
—
225
1,611
2,224
137
—
949
283
5,204
3
3,984
(427)
(16)
292
(1,316)
2,520
229
2,749
7,953
(a) At December 31, 2019 and December 31, 2018, respectively, nil and $7 of cash and cash equivalents, $13 and $30
of accounts and notes receivable (net), $35 and $49 of inventories, nil and $5 of other current assets, $180 and $265
of property, plant and equipment (net), nil and $10 of intangible assets (net), $20 and $52 of other noncurrent assets,
$100 and $123 of accounts payable, $10 and $30 of accrued liabilities, $36 and $25 of current portion of debt, $4
and nil of current operating lease liabilities, $29 and $61 of long-term debt, $11 and nil of noncurrent operating lease
and $87 and $97 of other noncurrent liabilities from consolidated variable interest entities are included in the
respective Balance Sheet captions above. See “Note 8. Variable Interest Entities.”
See accompanying notes to consolidated financial statements.
30
HUNTSMAN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Millions, Except Share and Per Share Amounts)
Revenues:
Year ended December 31,
2018
2017
2019
Trade sales, services and fees, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,664 $ 7,451 $ 6,684
Related party sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
161
6,845
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,194
Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,651
Operating expenses:
133
6,797
5,415
1,382
153
7,604
5,840
1,764
Selling, general and administrative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Research and development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Restructuring, impairment and plant closing (credits) costs . . . . . . . . . . . . . . . . . . . . . .
Merger costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other operating expense (income), net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity in income of investment in unconsolidated affiliates . . . . . . . . . . . . . . . . . . . . . . .
Fair value adjustments to Venator investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Loss on early extinguishment of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other income, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income from continuing operations before income taxes . . . . . . . . . . . . . . . . . . . . . .
Income tax benefit (expense) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income (loss) from discontinued operations, net of tax . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income attributable to noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income attributable to Huntsman Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . $
786
137
(41)
—
31
913
469
(111)
54
(18)
(23)
20
391
38
429
169
598
(36)
562 $
789
145
(7)
2
8
937
827
(115)
55
(62)
(3)
32
734
(45)
689
(39)
650
(313)
337 $
759
132
19
28
(16)
922
729
(165)
13
—
(54)
8
531
(20)
511
230
741
(105)
636
Basic (loss) income per share:
Income from continuing operations attributable to Huntsman Corporation common
stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1.72 $ 2.55 $ 1.71
Income (loss) from discontinued operations attributable to Huntsman Corporation
common stockholders, net of tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.96
Net income attributable to Huntsman Corporation common stockholders . . . . . . . . . . . . $ 2.46 $ 1.42 $ 2.67
238.4
Weighted average shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
238.1
228.9
(1.13)
0.74
Diluted (loss) income per share:
Income from continuing operations attributable to Huntsman Corporation common
stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1.70 $ 2.52 $ 1.66
Income (loss) from discontinued operations attributable to Huntsman Corporation
common stockholders, net of tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.95
Net income attributable to Huntsman Corporation common stockholders . . . . . . . . . . . . $ 2.44 $ 1.39 $ 2.61
243.9
Weighted average shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
241.6
230.6
(1.13)
0.74
Amounts attributable to Huntsman Corporation common stockholders:
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Income (loss) from discontinued operations, net of tax . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
393 $
169
562 $
608 $
(271)
337 $
406
230
636
See accompanying notes to consolidated financial statements.
31
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S
HUNTSMAN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EQUITY
(In Millions, Except Share Amounts)
Huntsman Corporation Stockholders’ Equity
(Accumulated Accumulated
3
3
Beginning balance, January 1, 2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other comprehensive income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Issuance of nonvested stock awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Vesting of stock awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Recognition of stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Repurchase and cancellation of stock awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Stock options exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Disposition of a portion of Venator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Costs of the IPO and secondary offering of Venator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Conversion of restricted awards to Venator awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncontrolling interest from partial disposal of Venator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends paid to noncontrolling interests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Contribution from noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends declared on common stock ($0.50 per share) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Balance, December 31, 2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cumulative effect of changes in fair value of equity investments . . . . . . . . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Issuance of nonvested stock awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Vesting of stock awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Recognition of stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Repurchase and cancellation of stock awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Stock options exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Treasury stock repurchased . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Disposition of a portion of Venator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Costs of the secondary offering of Venator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncontrolling interest from partial disposal of Venator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deconsolidation of Venator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued and unpaid dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends paid to noncontrolling interests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends declared on common stock ($0.65 per share) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Balance, December 31, 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Issuance of nonvested stock awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Vesting of stock awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Recognition of stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Repurchase and cancellation of stock awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Stock options exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Treasury stock repurchased . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Acquisition of noncontrolling interests, net of tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends declared to noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends declared on common stock ($0.65 per share) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Balance, December 31, 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Shares
Common
stock
236,370,347 $
—
—
—
1,316,975
—
(402,978)
2,929,262
—
—
—
—
—
—
—
240,213,606
—
—
—
—
1,135,003
—
(259,643)
2,310,663
(10,405,457)
—
—
—
—
—
—
—
232,994,172
—
—
—
1,643,368
—
(488,441)
246,661
(10,099,892)
—
—
—
224,295,868 $
Additional
Common
stock
paid-in
capital
Treasury
stock
Unearned
stock-based
compensation
deficit)
retained
earnings
other
Noncontrolling
comprehensive
loss
interests in
subsidiaries
3 $
—
—
—
—
—
—
—
—
—
—
—
—
—
—
3
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
3
—
—
—
—
—
—
—
—
—
—
—
3 $
3,447 $
—
—
18
8
10
—
53
413
(58)
(2)
—
—
—
—
3,889
—
—
—
14
11
8
—
46
—
18
(2)
—
—
—
—
—
3,984
—
—
17
7
7
—
4
—
(11)
—
—
4,008 $
(150) $
—
—
—
—
—
—
—
—
—
—
—
—
—
—
(150)
—
—
—
—
—
—
—
—
(277)
—
—
—
—
—
—
—
(427)
—
—
—
—
—
—
—
(208)
—
—
—
(635) $
(17) $
—
—
(18)
—
18
—
—
—
—
2
—
—
—
—
(15)
—
—
—
(14)
—
13
—
—
—
—
—
—
—
—
—
—
(16)
—
—
(17)
—
16
—
—
—
—
—
—
(17) $
(325) $
636
—
—
—
—
(12)
(18)
—
—
—
—
—
—
(120)
161
10
337
—
—
—
—
(30)
(29)
—
—
—
—
—
(1)
—
(156)
292
562
—
—
—
—
(12)
(2)
—
—
—
(150)
690 $
(1,671) $
—
403
—
—
—
—
—
—
—
—
—
—
—
—
(1,268)
(10)
—
(198)
—
—
—
—
—
—
—
—
—
160
—
—
—
(1,316)
—
(46)
—
—
—
—
—
—
—
—
—
(1,362) $
180 $
105
(107)
—
—
—
—
—
—
—
—
602
(34)
5
—
751
—
313
(42)
—
—
—
—
—
—
—
—
27
(751)
—
(69)
—
229
36
10
—
—
—
—
—
—
(73)
(65)
—
137 $
Total
equity
1,467
741
296
—
8
28
(12)
35
413
(58)
—
602
(34)
5
(120)
3,371
—
650
(240)
—
11
21
(30)
17
(277)
18
(2)
27
(591)
(1)
(69)
(156)
2,749
598
(36)
—
7
23
(12)
2
(208)
(84)
(65)
(150)
2,824
See accompanying notes to consolidated financial statements.
HUNTSMAN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Millions)
Year ended December 31,
2018
2019
2017
Operating Activities:
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Less: (Income) loss from discontinued operations, net of tax . . . . . . . . . . . . . . . . . . .
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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 . . . . . . . . . . . . . . . . . . . .
Unrealized losses on fair value adjustments to Venator investment . . . . . . . . . . . . . .
Cash received from return on investment in unconsolidated subsidiary . . . . . . . . . . .
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncash lease expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(Gain) loss on disposal of businesses/assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Loss on early extinguishment of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncash interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncash restructuring and impairment charges (credits) . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncash loss (gain) on foreign currency transactions . . . . . . . . . . . . . . . . . . . . . . . . .
Stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changes in operating assets and liabilities:
Accounts and notes receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash provided by operating activities from continuing operations . . . . . . . .
Net cash provided by operating activities from discontinued operations . . . . . .
Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investing Activities:
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Acquisition of a business, net of cash acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from sale of assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash received from termination of cross-country interest rate contacts . . . . . . . . . . .
Cash received from forward swap contract related to the sale of investment in
Venator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash used in investing activities from continuing operations . . . . . . . . . . . . .
Net cash used in investing activities from discontinued operations . . . . . . . . . . .
Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
598 $
(169)
429
650 $
39
689
741
(230)
511
(54)
19
24
270
55
(49)
23
3
3
(93)
8
29
9
138
77
(27)
53
(90)
21
(50)
(142)
656
241
897
(274)
—
50
—
16
7
(201)
(59)
(260)
(55)
62
—
255
—
3
3
1
(22)
(167)
(3)
27
5
(22)
(80)
(9)
59
(41)
12
44
(57)
704
503
1,207
(251)
(366)
—
—
3
(1)
(615)
(358)
(973)
(13)
—
—
236
—
(8)
54
8
1
(95)
(5)
36
6
(161)
(88)
(11)
23
(46)
127
54
43
672
547
1,219
(234)
(14)
25
7
—
(1)
(217)
(207)
(424)
(continued)
34
HUNTSMAN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(In Millions)
Year ended December 31,
2018
2019
2017
Financing Activities:
Net (repayments) borrowings on revolving loan facilities . . . . . . . . . . . . . . . . . . . . . $
Net (repayments) borrowings on overdraft facilities . . . . . . . . . . . . . . . . . . . . . . . . .
Repayments of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from issuance of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from long-term debt of Venator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Repayments of short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Borrowings on short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Repayments of notes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Borrowings on note payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt issuance costs paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Costs of early extinguishment of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends paid to common stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends paid to noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash paid for noncontrolling interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Contribution from noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Repurchase of common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Repurchase and cancellation of stock awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from issuance of common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from the IPO of Venator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash paid for expenses for the IPO of Venator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from the secondary offering of Venator . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash paid for expenses of the secondary offering of Venator . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash used in financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of exchange rate changes on cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Increase in cash, cash equivalents and restricted cash . . . . . . . . . . . . . . . . . . . . . . . .
Cash, cash equivalents and restricted cash from continuing operations at
(89) $
—
(676)
742
—
—
102
(27)
37
(8)
(21)
(150)
(41)
(101)
—
(208)
(12)
2
—
—
—
—
—
(450)
(2)
185
125 $
(1)
(68)
—
—
(8)
6
(29)
27
(4)
—
(156)
(69)
—
—
(277)
(30)
17
—
—
44
(2)
1
(424)
(35)
(225)
(41)
1
(2,058)
24
750
(15)
8
(27)
31
(21)
—
(120)
(34)
—
5
—
(12)
35
1,012
(58)
—
—
1
(519)
18
294
beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
340
481
Cash, cash equivalents and restricted cash from discontinued operations at
beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deconsolidation of cash, cash equivalents and restricted cash from Venator . . . . . .
Cash, cash equivalents and restricted cash at end of period . . . . . . . . . . . . . . . . . . . . $
—
—
525 $
238
(154)
340 $
396
29
—
719
Supplemental cash flow information:
Cash paid for interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash paid for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
111 $
100
163 $
179
175
25
As of December 31, 2019, 2018 and 2017, the amount of capital expenditures in accounts payable was
$64 million, $66 million and $51 million, respectively. In addition, as of December 31, 2018, the amount of cash interest
and cash income taxes included in our supplemental cash flow information related to cash paid for interest and cash paid
for income taxes that was paid by Venator was $46 million and $38 million, respectively. As of December 31, 2017, the
amount of cash interest and cash income taxes included in our supplemental cash flow information related to cash paid
for interest and cash paid for income taxes that was paid by Venator after the IPO date was $6 million and $16 million,
respectively.
See accompanying notes to consolidated financial statements.
35
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. GENERAL
DEFINITIONS
For convenience in this report, the terms “Company,” “our” or “we” may be used to refer to Huntsman
Corporation and, unless the context otherwise requires, its subsidiaries and predecessors. Any references to the
“Company” “we” “us” or “our” as of a date prior to October 19, 2004 (the date of our Company’s formation) are to
Huntsman Holdings, LLC and its subsidiaries (including their respective predecessors). In this report, “Huntsman
International” refers to Huntsman International LLC (our wholly-owned subsidiary) and, unless the context otherwise
requires, its subsidiaries; “AAC” refers to Arabian Amines Company, our consolidated manufacturing joint venture with
the Zamil Group; “HPS” refers to Huntsman Polyurethanes Shanghai Ltd. (our consolidated splitting joint venture with
Shanghai Chlor-Alkali Chemical Company, Ltd); and “SLIC” refers to Shanghai Liengheng Isocyanate Company (our
unconsolidated manufacturing joint venture with BASF and three Chinese chemical companies).
In this report, we may use, without definition, the common names of competitors or other industry participants.
We may also use the common names or abbreviations for certain chemicals or products. Each capitalized term used
without definition in this report has the meaning specified in the Annual Report on Form 10-K for the year ended
December 31, 2019, which was filed with the Securities and Exchange Commission on February 13, 2020.
DESCRIPTION OF BUSINESS
We are a global manufacturer of differentiated organic chemical products. We operate in four segments:
Polyurethanes, Performance Products, Advanced Materials and Textile Effects. Our products comprise a broad range of
chemicals and formulations, which we market globally to a diversified group of consumer and industrial customers. Our
products are used in a wide range of applications, including those in the adhesives, aerospace, automotive, construction
products, personal care and hygiene, durable and non-durable consumer products, digital inks, electronics, insulation,
medical, packaging, coatings and construction, power generation, refining, synthetic fiber, textile chemicals and dye
industries. We are a leading global producer in many of our key product lines, including MDI, amines, maleic anhydride,
epoxy-based polymer formulations, textile chemicals and dyes.
COMPANY
Our Company, a Delaware corporation, was formed in 2004 to hold the Huntsman businesses, which were
founded by Jon M. Huntsman. Mr. Huntsman founded the predecessor to our Company in 1970 as a small polystyrene
plastics packaging company. Since then, we have grown through a series of acquisitions and now own a global portfolio
of businesses.
Currently, we operate all of our businesses through Huntsman International, our wholly-owned subsidiary.
Huntsman International is a Delaware limited liability company and was formed in 1999.
RECENT DEVELOPMENTS
Sale of Chemical Intermediates Businesses
On January 3, 2020, we completed the sale of our Chemical Intermediates Businesses to Indorama in a
transaction valued at approximately $2 billion, comprising a cash purchase price of approximately $1.93 billion, which
includes estimated adjustments to the purchase price for working capital, plus the transfer of approximately $72 million
in net underfunded pension and other post-employment benefit liabilities. The final purchase price is subject to
customary post-closing adjustments. The net after tax cash proceeds are expected to be approximately $1.6 billion. For
more information, see “Note 4. Discontinued Operations and Business Dispositions—Sale of Chemical Intermediates
Businesses.”
36
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
1. GENERAL (Continued)
Icynene-Lapolla Acquisition
On December 5, 2019, we entered into an agreement with an affiliate of FFL Partners, LLC to acquire Icynene-
Lapolla, a leading North American manufacturer and distributor of spray polyurethane foam insulation systems for
residential and commercial applications. Icynene-Lapolla operates two manufacturing facilities located in Houston,
Texas and Mississauga, Ontario. Under terms of the agreement, we agreed to pay $350 million, subject to customary
closing adjustments, in an all-cash transaction to be funded from available liquidity. The transaction is expected to close
in the first quarter of 2020. The acquired business is expected to be integrated into our Polyurethanes segment.
Acquisition of Remaining Interest in Sasol-Huntsman Joint Venture
On September 30, 2019, we acquired from Sasol, our former joint venture partner, the 50% noncontrolling
interest that we did not own in the Sasol-Huntsman maleic anhydride joint venture. The joint venture owned a
manufacturing facility in Moers, Germany with capacity to produce 230 million pounds of maleic anhydride. We paid
Sasol $101 million, which included acquired cash, net of any debt. The purchase price was funded from the 2019 Term
Loan.”
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CARRYING VALUE OF LONG-LIVED ASSETS
We review long-lived assets and all amortizable intangible assets for impairment whenever events or changes in
circumstances indicate that the carrying amount of these assets may not be recoverable. Recoverability is based upon
current and anticipated undiscounted cash flows, and we recognize an impairment when such estimated cash flows are
less than the carrying value of the asset. Measurement of the amount of impairment, if any, is based upon the difference
between carrying value and fair value. Fair value is generally estimated by discounting estimated future cash flows using
a discount rate commensurate with the risks involved or selling price of assets held for sale.
CASH AND CASH EQUIVALENTS
We consider cash in checking accounts and cash in short-term highly liquid investments with remaining
maturities of three months or less at the date of purchase, to be cash and cash equivalents.
COST OF GOODS SOLD
We classify the costs of manufacturing and distributing our products as cost of goods sold. Manufacturing costs
include variable costs, primarily raw materials and energy, and fixed expenses directly associated with production.
Manufacturing costs also include, among other things, plant site operating costs and overhead (including depreciation),
production planning and logistics costs, repair and maintenance costs, plant site purchasing costs, and engineering and
technical support costs. Distribution, freight and warehousing costs are also included in cost of goods sold.
DERIVATIVES AND HEDGING ACTIVITIES
All derivatives, whether designated in hedging relationships or not, are recorded on our balance sheet at fair
value. If the derivative is designated as a fair value hedge, the changes in the fair value of the derivative and the hedged
items are recognized in earnings. If the derivative is designated as a cash flow hedge, changes in the fair value of the
derivative are recorded in accumulated other comprehensive loss, to the extent effective, and will be recognized in the
income statement when the hedged item affects earnings. Changes in the fair value of the hedge in the net investment of
certain international operations are recorded in other comprehensive income (loss), to the extent effective. The
effectiveness of a cash flow hedging relationship is established at the inception of the hedge, and after inception we
perform effectiveness assessments at least every three months. A derivative designated as a cash flow hedge is
37
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
determined to be effective if the change in value of the hedge divided by the change in value of the hedged item is within
a range of 80% to 125%. Hedge ineffectiveness in a cash flow hedge occurs only if the cumulative gain or loss on the
derivative hedging instrument exceeds the cumulative change in the expected future cash flows on the hedged
transaction. For a derivative that does not qualify or has not been designated as a hedge, changes in fair value are
recognized in earnings.
ENVIRONMENTAL EXPENDITURES
Environmental related restoration and remediation costs are recorded as liabilities when site restoration and
environmental remediation and clean-up obligations are either known or considered probable and the related costs can be
reasonably estimated. Other environmental expenditures that are principally maintenance or preventative in nature are
recorded when expended and incurred and are expensed or capitalized as appropriate. See “Note 22. Environmental,
Health and Safety Matters.”
EQUITY METHOD INVESTMENTS
We account for our equity investments where we own a non-controlling interest, but exercise significant
influence, under the equity method of accounting. Under the equity method of accounting, our original cost of the
investment is adjusted for our share of equity in the earnings of the equity investee and reduced by dividends and
distributions of capital received, unless the fair value option is elected, in which case the investment balance is marked to
fair value each reporting period and the impact of changes in fair value of the equity investment are reported in earnings.
We elected the fair value option to account for our equity method investment in Venator. For more information, see
“Note 4. Discontinued Operations and Business Dispositions—Separation and Deconsolidation of Venator.” The change
in the fair value related to our equity method investment in Venator is presented in “Fair value adjustments to Venator
investment” on the consolidated statements of operations.
FOREIGN CURRENCY TRANSLATION
The accounts of our operating subsidiaries outside of the U.S., unless they are operating in highly inflationary
economic environments, consider the functional currency to be the currency of the economic environment in which they
operate. Accordingly, assets and liabilities are translated at rates prevailing at the balance sheet date. Revenues,
expenses, gains and losses are translated at a weighted average rate for the period. Cumulative translation adjustments
are recorded to equity as a component of accumulated other comprehensive loss.
If a subsidiary operates in an economic environment that is considered to be highly inflationary (100%
cumulative inflation over a three-year period), the U.S. dollar is considered to be the functional currency and gains and
losses from remeasurement to the U.S. dollar from the local currency are included in the statement of operations. Where
a subsidiary’s operations are effectively run, managed, financed and contracted in U.S. dollars, such as certain finance
subsidiaries outside of the U.S., the U.S. dollar is considered to be the functional currency.
Foreign currency transaction gains and losses are recorded in other operating expense (income), net in our
consolidated statements of operations and were (losses) gains of $(8) million, $3 million and $5 million for the years
ended December 31, 2019, 2018 and 2017, respectively.
INCOME TAXES
We use the asset and liability method of accounting for income taxes. Deferred income taxes reflect the net tax
effects of temporary differences between the carrying amounts of assets and liabilities for financial and tax reporting
purposes. We evaluate deferred tax assets to determine whether it is more likely than not that they will be realized.
Valuation allowances are reviewed on a tax jurisdiction basis to analyze whether there is sufficient positive or negative
evidence to support a change in judgment about the realizability of the related deferred tax assets for each jurisdiction.
38
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
These conclusions require significant judgment. In evaluating the objective evidence that historical results provide, we
consider the cyclicality of businesses and cumulative income or losses during the applicable period. Cumulative losses
incurred over the period limits our ability to consider other subjective evidence such as our projections for the future.
Changes in expected future income in applicable jurisdictions could affect the realization of deferred tax assets in those
jurisdictions.
On December 22, 2017, the U.S. Tax Reform Act was signed into law. The U.S. Tax Reform Act significantly
revised the U.S. corporate income tax regime by, among other things, lowering the U.S. corporate tax rate from 35% to
21%, (effective January 1, 2018), creation of the base erosion anti-abuse tax provision (“BEAT”) and a new provision
designed to tax global intangible low-taxed income (“GILTI”) (effective January 1, 2018) and imposing a repatriation
tax on deemed repatriated earnings of foreign subsidiaries.
As a result of the enactment of the U.S. Tax Reform Act, the Company recorded a net tax benefit of $20 million
over 2017 and 2018. We recorded a net tax benefit of $135 million due to a remeasurement of deferred U.S. tax assets
and liabilities (including a provisional tax benefit of $137 million in 2017, partially offset by a final tax expense of $2
million in 2018) offset by tax expense of $115 million due to the transition tax on the deemed repatriation of deferred
foreign income (including a provisional tax expense of $85 million in 2017 and a $30 million measurement period
adjustment in 2018). We did not make the election to reclassify the income tax effects of the U.S. Tax Reform Act from
accumulated other comprehensive income to retained earnings.
Accounting for uncertainty in income taxes prescribes a recognition threshold and measurement attribute for the
financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The
application of income tax law is inherently complex. We are required to determine if an income tax position meets the
criteria of more-likely-than-not to be realized based on the merits of the position under tax law, in order to recognize an
income tax benefit. This requires us to make significant judgments regarding the merits of income tax positions and the
application of income tax law. Additionally, if a tax position meets the recognition criteria of more-likely-than-not we
are required to make judgments and apply assumptions to measure the amount of the tax benefits to recognize. These
judgments are based on the probability of the amount of tax benefits that would be realized if the tax position was
challenged by the taxing authorities. Interpretations and guidance surrounding income tax laws and regulations change
over time. As a consequence, changes in assumptions and judgments can materially affect amounts recognized in our
consolidated financial statements. For further information concerning taxes, see “Note 20. Income Taxes.”
INTANGIBLE ASSETS AND GOODWILL
Intangible assets are stated at cost (fair value at the time of acquisition) and are amortized using the straight-line
method over the estimated useful lives or the life of the related agreement as follows:
Patents and technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Trademarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Licenses and other agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5 - 30 years
9 - 30 years
5 - 15 years
5 - 15 years
Goodwill represents costs in excess of fair values assigned to the underlying net assets of acquired businesses.
Goodwill is not subject to any method of amortization, but is tested for impairment annually (at the beginning of the
third quarter) and when events and circumstances change that would more likely than not reduce the fair value of a
reporting unit below its carrying amount. When the fair value is less than the carrying value of the related reporting unit,
we are required to reduce the amount of goodwill through a charge to earnings. Fair value is estimated using the market
approach, as well as the income approach based on discounted cash flow projections. Goodwill has been assigned to
reporting units for purposes of impairment testing.
39
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
During 2019, goodwill decreased by approximately $2 million due to the finalization of the valuation of the
assets and liabilities of an acquisition, partially offset by a net increase of approximately $1 million due to changes in
foreign currency exchange rates. See “Note 3. Business Combinations and Acquisitions.”
INVENTORIES
Inventories are stated at the lower of cost or market, with cost determined using LIFO, first-in first-out, and
average costs methods for different components of inventory.
LEGAL COSTS
We expense legal costs, including those legal costs incurred in connection with a loss contingency, as incurred.
NET INCOME PER SHARE ATTRIBUTABLE TO HUNTSMAN CORPORATION
Basic income per share excludes dilution and is computed by dividing net income attributable to Huntsman
Corporation common stockholders by the weighted average number of shares outstanding during the period. Diluted
income per share reflects all potential dilutive common shares outstanding during the period and is computed by dividing
net income available to Huntsman Corporation common stockholders by the weighted average number of shares
outstanding during the period increased by the number of additional shares that would have been outstanding as dilutive
securities.
Basic and diluted income per share is determined using the following information (in millions):
Numerator:
Basic and diluted income from continuing operations:
Income from continuing operations attributable to Huntsman
Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 393 $ 608 $ 406
Year ended December 31,
2019
2018
2017
Basic and diluted net income:
Net income attributable to Huntsman Corporation . . . . . . . . . . . . . . . . . $ 562 $ 337 $ 636
Denominator:
Weighted average shares outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dilutive shares:
Stock-based awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total weighted average shares outstanding, including dilutive shares . .
1.7
230.6
3.5
241.6
5.5
243.9
228.9
238.1
238.4
Additional stock-based awards of 3.0 million, 0.8 million and 0.8 million weighted average equivalent shares of
stock were outstanding during the years ended December 31, 2019, 2018 and 2017, respectively. However, these
stock-based awards were not included in the computation of diluted earnings per share for the respective periods
mentioned because the effect would be anti-dilutive.
OTHER NONCURRENT ASSETS
Periodic maintenance and repairs applicable to major units of manufacturing facilities (a “turnaround”) are
accounted for on the deferral basis by capitalizing the costs of the turnaround and amortizing the costs over the estimated
period until the next turnaround.
40
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
PRINCIPLES OF CONSOLIDATION
Our consolidated financial statements include the accounts of our wholly owned and majority owned
subsidiaries and any variable interest entities for which we are the primary beneficiary. All intercompany accounts and
transactions have been eliminated.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment is stated at cost less accumulated depreciation. Depreciation is computed using
the straight-line method over the estimated useful lives or lease term as follows:
Buildings and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 - 50 years
Plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 - 30 years
Furniture, fixtures and leasehold improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 - 20 years
Interest expense capitalized as part of plant and equipment was $4 million, $4 million and $9 million for the
years ended December 31, 2019, 2018 and 2017, respectively.
Normal maintenance and repairs of plant and equipment are charged to expense as incurred. Renewals,
betterments and major repairs that materially extend the useful life of the assets are capitalized, and the assets replaced, if
any, are retired.
RECLASSIFICATIONS
Certain amounts in the consolidated financial statements for prior periods have been reclassified to conform with the
current presentation. These reclassifications were to record the assets and liabilities of our Chemical Intermediates
Businesses as held for sale and its results of operations as discontinued operations. See “Note 1. General—Recent
Developments—Sale of Chemical Intermediates Businesses” as well as “Note 4. Discontinued Operations and Business
Dispositions—Sale of Chemical Intermediates Businesses.”
REVENUE RECOGNITION
We generate substantially all of our revenue through product sales in which revenue is recognized at a point in
time. We recognize revenue when control of the promised goods is transferred to our customers. Control of goods
usually passes to the customer at the time shipment is made. Revenue is measured as the amount that reflects the
consideration that we expect to be entitled to in exchange for those goods. See “Note 18. Revenue Recognition.”
SECURITIZATION OF ACCOUNTS RECEIVABLE
Under our A/R Programs, we grant an undivided interest in certain of our trade receivables to the special
purpose entities (“SPE”) in the U.S. and EU. This undivided interest serves as security for the issuance of debt. The A/R
Programs provide for financing in both U.S. dollars and euros. The amounts outstanding under our A/R Programs are
accounted for as secured borrowings. See “Note 15. Debt—Direct and Subsidiary Debt—A/R Programs.”
STOCK-BASED COMPENSATION
We measure the cost of employee services received in exchange for an award of equity instruments based on the
grant-date fair value of the award. That cost, net of estimated forfeitures, will be recognized over the period during which
the employee is required to provide services in exchange for the award. See “Note 24. Stock-Based Compensation Plan.”
41
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
USE OF ESTIMATES
The preparation of financial statements in conformity with GAAP requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
ACCOUNTING PRONOUNCEMENTS ADOPTED DURING 2019
In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update
(“ASU”) No. 2016-02, Leases (Topic 842). The amendments in this ASU increase transparency and comparability
among entities by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about
leasing arrangements. The amendments in this ASU require lessees to recognize in the statement of financial position a
liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying
asset for the lease term. In January 2018, the FASB issued ASU No. 2018-01, Leases (Topic 842): Land Easement
Practical Expedient for Transition to Topic 842, providing an optional transition practical expedient to not evaluate
under Topic 842 existing or expired land easements that were not previously accounted for as leases under the current
leases guidance in Topic 840, and in July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted
Improvements, providing an optional transition method allowing entities to initially apply the new lease standard at the
adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of
adoption. The amendments in these ASUs are effective for fiscal years, and interim periods within those fiscal years,
beginning after December 15, 2018. Reporting entities can elect to recognize and measure leases under these
amendments at the beginning of the earliest period presented using a modified retrospective approach or otherwise elect
the transition method provided under ASU No. 2018-11. On January 1, 2019, we adopted the amendments in these ASUs
using the transition method that allowed us to initially apply the new lease standard at the adoption date. The initial
adoption of the new lease standard had a material impact on our consolidated balance sheets, but did not have an impact
on our consolidated statements of operations. The most significant impact was the recognition of operating lease
liabilities and operating lease right-of-use assets. On January 1, 2019, we recognized operating lease liabilities of $400
million and operating lease right-of-use assets of $371 million. As a result of the adoption of these amendments, we
revised our accounting policy for leases as detailed in “Note 9. Leases.”
In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815): Targeted
Improvements to Accounting for Hedging Activities. The amendments in this ASU better align an entity’s risk
management activities and financial reporting for hedging relationships through changes to both the designation and
measurement guidance for qualifying hedging relationships as well as the recognition and presentation of the effects of
the hedging instrument and the hedged item in the financial statements to increase the understandability of the results of
an entity’s intended hedging strategies. The amendments in this ASU also include certain targeted improvements to ease
the application of current guidance related to the assessment of hedge effectiveness. The amendments in this ASU are
effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.
Transition requirements and elections should be applied to hedging relationships existing on the date of adoption. For
cash flow and net investment hedges, an entity should apply a cumulative-effect adjustment related to eliminating the
separate measurement of ineffectiveness, and the amended presentation and disclosure guidance is required only
prospectively. We adopted the amendments in this ASU effective January 1, 2019, and the initial adoption of this ASU
did not have a significant impact on our consolidated financial statements.
In August 2018, the SEC issued a final rule, SEC Final Rule Release No. 33-10532, Disclosure Update and
Simplification, that amends certain of its disclosure requirements that have become redundant, duplicative, overlapping,
outdated or superseded, in light of other SEC disclosure requirements or U.S. GAAP. For filings on Form 10-Q, the final
rule, amongst other items, extends to interim periods the annual requirement to disclose changes in stockholders’ equity.
As amended by the final rule, registrants must now analyze changes in stockholders’ equity, in the form of a
reconciliation, for the then current and comparative year-to-date interim periods, with subtotals for each interim period.
42
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
The final rule became effective on November 5, 2018, that date being 30 days after its publication in the Federal
Register. We applied these changes in the presentation of stockholders’ equity beginning in the first quarter of 2019.
ACCOUNTING PRONOUNCEMENTS PENDING ADOPTION IN FUTURE PERIODS
In August 2018, the FASB issued ASU No. 2018-14, Compensation—Retirement Benefits—Defined Benefit
Plans—General (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit
Plans. The amendments in this ASU modify certain disclosure requirements for employers that sponsor defined benefit
pension or other postretirement plans by removing disclosures that no longer are considered cost beneficial, clarifying
the specific requirements of disclosures and adding disclosure requirements identified as relevant. The amendments in
this ASU are effective for fiscal years ending after December 15, 2020 and should be applied on a retrospective basis to
all periods presented. Early adoption is permitted. We do not expect the adoption of the amendments in this ASU to have
a significant impact on our consolidated financial statements.
In August 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software
(Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That
Is a Service Contract. The amendments in this ASU align the requirements for capitalizing implementation costs
incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs
incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software
license). The amendments in this ASU are effective for fiscal years beginning after December 15, 2019, including
interim periods within those fiscal years. Early adoption is permitted in any interim period after the issuance of this ASU.
We do not expect the adoption of the amendments in this ASU to have a significant impact on our consolidated financial
statements.
3. BUSINESS COMBINATIONS AND ACQUISITIONS
Acquisition of Remaining Interest in Sasol-Huntsman Joint Venture
On September 30, 2019, we acquired from Sasol, our former joint venture partner, the 50% noncontrolling
interest that we did not own in the Sasol-Huntsman maleic anhydride joint venture. We paid Sasol $101 million, which
included acquired cash, net of any debt. The purchase price was funded from the 2019 Term Loan. See “Note 15. Debt—
Direct and Subsidiary Debt—Term Loan Credit Facility.” In connection with this acquisition, we recorded an adjustment
to additional paid-in capital, net of tax, of $11 million. Prior to acquiring the 50% noncontrolling interest that we did not
own, we accounted for Sasol-Huntsman as a variable interest entity. See “Note 8. Variable Interest Entities.”
The effects of changes in our ownership interest in Sasol-Huntsman on the equity attributable to Huntsman
Corporation is as follows (dollars in millions):
Year ended December 31,
2018
2017
2019
Net income attributable to Huntsman Corporation shareholders . . . . . $
562 $
337 $
636
Decrease in Huntsman Corporation’s paid-in capital for
purchase of 50% interest in Sasol-Huntsman . . . . . . . . . . . . . . . . . . .
Net transfers to noncontrolling interest . . . . . . . . . . . . . . . . . . . . . . . . .
Change from net income attributable to Huntsman Corporation
(11)
(11)
—
—
—
—
shareholders and transfers to noncontrolling interest . . . . . . . . . . . .
$
551 $
337 $
636
43
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
3. BUSINESS COMBINATIONS AND ACQUISITIONS (Continued)
Acquisition of Demilec
On April 23, 2018, we acquired 100% of the outstanding equity interests of Demilec for approximately $353
million, including working capital adjustments, in an all-cash transaction, which was funded from our Prior Credit
Facility and our U.S. A/R Program. Demilec is a leading North American manufacturer and distributor of spray
polyurethane foam formulations for residential and commercial applications. The acquired business was integrated into
our Polyurethanes segment. Transaction costs charged to expense related to this acquisition were approximately $5
million in 2018 and were recorded in other operating expense (income), net in our consolidated statements of operations.
The Demilec Acquisition was aligned with our stated strategy to grow our downstream polyurethanes business and
leverage our global platform to expand Demilec’s portfolio of spray polyurethane foam formulations into international
markets.
We have accounted for the Demilec Acquisition using the acquisition method. As such, we determined the fair
value of tangible and intangible assets acquired and liabilities assumed. The allocation of acquisition cost to the assets
acquired and liabilities assumed is summarized as follows (dollars in millions):
Fair value of assets acquired and liabilities assumed:
Cash paid for the Demilec Acquisition in Q2 2018 . . . . . . . . . . . . . . . . . . . . . . . . $
Purchase price adjustment received in Q3 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net acquisition cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Property, plant and equipment, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total fair value of net assets acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
357
(4)
353
1
31
23
1
21
177
140
(16)
(3)
(22)
—
353
As a result of a preliminary valuation of the assets and liabilities, reallocations were made during 2018 in
certain property, plant and equipment, intangible asset, goodwill and deferred tax balances. As a result of the finalization
of the valuation of the assets and liabilities, additional reallocations were made in 2019 in certain goodwill, other
noncurrent liabilities and deferred tax balances. Intangible assets acquired consist primarily of trademarks, trade secrets
and customer relationships, all of which are being amortized over 15 years. We have assigned any excess of the
acquisition cost of the fair values to goodwill. During the third quarter of 2018, we received $4 million related to the
settlement of certain purchase price adjustments. The goodwill recognized is attributable primarily to projected future
profitable growth, penetration into downstream markets and synergies.
The acquired business had revenues and net income of $142 million and $5 million, respectively, for the period
from the date of acquisition to December 31, 2018.
44
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
3. BUSINESS COMBINATIONS AND ACQUISITIONS (Continued)
If this acquisition were to have occurred on January 1, 2017, the following estimated pro forma revenues, net
income and net income attributable to Huntsman Corporation and would have been reported (dollars in millions):
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income attributable to Huntsman Corporation . . . . . . . . . .
$
7,662
639
326
7,010
728
623
Pro Forma (Unaudited)
Year ended December 31,
2017
2018
4. DISCONTINUED OPERATIONS AND BUSINESS DISPOSITIONS
Sale of Chemical Intermediates Businesses
On January 3, 2020, we completed the sale of our Chemical Intermediates Businesses to Indorama in a
transaction valued at approximately $2 billion, comprising a cash purchase price of approximately $1.93 billion, which
includes estimated adjustments to the purchase price for working capital, plus the transfer of approximately $72 million
in net underfunded pension and other post-employment benefit liabilities. The final purchase price is subject to
customary post-closing adjustments. The net after tax cash proceeds are expected to be approximately $1.6 billion.
Beginning in the third quarter of 2019, we reported the assets and liabilities of our Chemical Intermediates Businesses as
held for sale and reported its results of operations as discontinued operations. Certain amounts for prior periods have
similarly been retrospectively reflected for all periods presented. In connection with this sale, we entered into long-term
supply agreements with Indorama for certain raw materials at market prices supplied by the Chemical Intermediates
Businesses.
The following table reconciles the carrying amounts of major classes of assets and liabilities of discontinued
operations to total assets and liabilities of discontinued operations that are classified as held for sale in our consolidated
balance sheets (dollars in millions):
December 31,
2019
December 31,
2018
Carrying amounts of major classes of assets held for sale:
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Property, plant and equipment, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease right-of-use assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
145 $
105
—
720
69
4
165
Total assets held for sale(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,208 $
Carrying amounts of major classes of liabilities held for sale:
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total noncurrent liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
152 $
26
20
135
51
128
Total liabilities held for sale(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
512 $
89
134
9
232
711
—
—
166
877
1,109
168
57
—
225
159
—
124
283
508
45
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
4. DISCONTINUED OPERATIONS AND BUSINESS DISPOSITIONS (Continued)
(1)
The assets and liabilities held for sale are classified as current as of December 31, 2019 because the sale of our
Chemical Intermediates Businesses was completed on January 3, 2020.
The following table reconciles major line items constituting pretax income of discontinued operations to after-
tax income (loss) of discontinued operations as presented in our consolidated statements of operations (dollars in
millions):
Major line items constituting pretax income of discontinued operations(1):
Trade sales, services and fees, net(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Cost of goods sold(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other expense items, net that are not major . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income from discontinued operations before income taxes . . . . . . . . . . . . .
Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Loss on disposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income (loss) from discontinued operations, net of tax . . . . . . . . . . . . . . . . .
Net income attributable to noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . .
Net income (loss) attributable to discontinued operations . . . . . . . . . . . . . . . $
Year ended December 31,
2018
2017
2019
1,545 $
1,287
54
204
(35)
—
—
169
—
169 $
3,923 $
2,847
332
744
(86)
(427)
(270)
(39)
(6)
(45) $
3,747
3,198
208
341
(111)
—
—
230
(10)
220
(1) Discontinued operations include our Chemical Intermediates Businesses, our Australian styrenics operations and
our North American polymers and base chemicals operations for all periods presented. We began accounting for
our investment in Venator as an equity method investment on December 3, 2018. Therefore, the summarized
financial data only includes the results of Venator applicable to the period from January 1, 2017 through
December 2, 2018.
(2)
Includes eliminations of trade sales, services and fees, net and cost of sales between continuing operations and
discontinued operations.
Separation and Deconsolidation of Venator
In August 2017, we separated the P&A Business and conducted an IPO of ordinary shares of Venator, formerly
a wholly-owned subsidiary of Huntsman. Additionally, in December 2017, we conducted a secondary offering of
Venator ordinary shares. All of such ordinary shares were sold by Huntsman, and Venator did not receive any proceeds
from the offerings.
On January 3, 2018, the underwriters purchased an additional 1,948,955 Venator ordinary shares pursuant to
their over-allotment option, which reduced Huntsman’s ownership interest in Venator to approximately 53%. Beginning
in the third quarter of 2017, we reported the results of operations of Venator as discontinued operations.
On December 3, 2018, we sold an aggregate of 4,334,389, or 4%, of Venator ordinary shares to Bank of
America N.A. at a price determined based on the average of the daily volume weighted average price of Venator
ordinary shares over an agreed period (the “Forward Swap”). Over this agreed period, we received aggregate proceeds of
$19 million, $16 million of which was received in the first quarter of 2019. Following this transaction, we retained
approximately 49% ownership in Venator and this transaction allowed us to deconsolidate Venator beginning in
December 2018, and thus we began accounting for our remaining interest in Venator as an equity method investment and
elected the fair value option to account for our equity method investment in Venator.
46
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
4. DISCONTINUED OPERATIONS AND BUSINESS DISPOSITIONS (Continued)
Although we intend to monetize our remaining 49% ownership in Venator, our ability to sell our ordinary
shares of Venator at a reasonable price is dependent upon the prevailing market value of Venator common stock. The
depressed Venator stock price inhibits our ability to sell our remaining shares of Venator at a reasonable price, which
could continue for more than twelve months. Therefore, in December 2018, our equity method investment in Venator did
not meet the held for sale criteria and our equity method investment in Venator was recorded in continuing operations.
During the first quarter of 2019, we recorded a gain of $1 million to record the Forward Swap at fair value.
Additionally, for year ended December 31, 2019, we recorded a loss of $19 million to record our investment in Venator
at fair value. These gains and losses were recorded in “Fair value adjustments to Venator investment” on our
consolidated statements of operations.
5. INVENTORIES
Inventories consisted of the following (dollars in millions):
Raw materials and supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Work in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Finished goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
LIFO reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
175 $
49
718
942
(28)
914 $
191
51
798
1,040
(40)
1,000
December 31, December 31,
2019
2018
For December 31, 2019 and 2018, approximately 9% and 6% of inventories were recorded using the LIFO cost
method, respectively.
6. PROPERTY, PLANT AND EQUIPMENT
The cost and accumulated depreciation of property, plant and equipment were as follows (dollars in millions):
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Construction in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
December 31,
2019
2018
105
103 $
602
605
4,550
4,695
249
285
5,506
5,688
(3,305)
(3,153)
2,383 $ 2,353
Depreciation expense for 2019, 2018 and 2017 was $245 million, $239 million and $226 million, respectively.
47
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
7. INVESTMENT IN UNCONSOLIDATED AFFILIATES
Our ownership percentage and investment in unconsolidated affiliates were as follows (dollars in millions):
Equity Method:
Venator Materials PLC (49%)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
BASF Huntsman Shanghai Isocyanate Investment BV (50%)(2) . . . . . .
Nanjing Jinling Huntsman New Material Co., Ltd. (49%) . . . . . . . . . . . .
Jurong Ningwu New Material Development Co., Ltd. (30%) . . . . . . . . .
Total investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
December 31,
2019
2018
200 $
112
196
27
535 $
219
120
163
24
526
(1) We account for our remaining investment in Venator as an equity method investment using the fair
value option. For more information see “Note 4. Discontinued Operations and Business Dispositions—
Separation and Deconsolidation of Venator.”
(2) We own 50% of BASF Huntsman Shanghai Isocyanate Investment BV. BASF Huntsman Shanghai
Isocyanate Investment BV owns a 70% interest in SLIC, thus giving us an indirect 35% interest in
SLIC.
SUMMARIZED FINANCIAL INFORMATION OF UNCONSOLIDATED AFFILIATES
Summarized financial information of our unconsolidated affiliates as of December 31, 2019 and 2018 and for
the years ended December 31, 2019, 2018 and 2017 is as follows (dollars in millions):
Current assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Non-current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
December 31,
2019
1,439 $
2,436
688
1,614
7
2018
1,548
2,444
781
1,683
8
Year ended December 31,
2019(1) 2018(1)
2017
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,025 $ 2,181 $ 1,109
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
112
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . .
34
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
34
454
99
99
221
124
124
(1) We began accounting for our investment in Venator as an equity method investment on December 3,
2018. Therefore, the summarized financial data only includes information for Venator for the year
ended December 31, 2019 and the period from December 3, 2018 through December 31, 2018.
8. VARIABLE INTEREST ENTITIES
We evaluate our investments and transactions to identify variable interest entities for which we are the primary
beneficiary. We hold a variable interest in the following joint ventures for which we are the primary beneficiary:
• Rubicon LLC is our 50%-owned joint venture with Lanxess that manufactures products for our
Polyurethanes and Performance Products segments. The structure of the joint venture is such that the total
equity investment at risk is not sufficient to permit the joint venture to finance its activities without
additional financial support. By virtue of the operating agreement with this joint venture, we purchase a
majority of the output, absorb a majority of the operating costs and provide a majority of the additional
funding.
48
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
8. VARIABLE INTEREST ENTITIES (Continued)
• AAC is our 50%-owned joint venture with Zamil group that manufactures products for our Performance
Products segment. As required in the operating agreement governing this joint venture, we purchase all of
AAC’s production and sell it to our customers. Substantially all of the joint venture’s activities are
conducted on our behalf.
• Sasol-Huntsman was our 50%-owned joint venture with Sasol that owned and operated a maleic anhydride
facility in Moers, Germany. This joint venture manufactured products for our Performance Products
segment. Sasol-Huntsman used our technology and expertise, and we bore a disproportionate amount of
risk of loss due to a related-party loan to Sasol-Huntsman for which we bore the default risk. On
September 30, 2019, we acquired the 50% noncontrolling interest that we did not own in the Sasol-
Huntsman. As such, as of September 30, 2019, this joint venture was no longer accounted for as a variable
interest entity. See “Note 3. Business Combinations and Acquisitions.”
Creditors of these entities have no recourse to our general credit. See “Note 15. Debt—Direct and Subsidiary
Debt.” As the primary beneficiary of these variable interest entities at December 31, 2019, the joint ventures’ assets,
liabilities and results of operations are included in our consolidated financial statements.
The following table summarizes the carrying amount of our variable interest entities’ assets and liabilities
included in our consolidated balance sheets as of December 31, 2019 and 2018 (dollars in millions):
December 31, December 31,
2019(1)
2018
Current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Property, plant and equipment, net . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease right-of-use assets. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
50 $
180
16
132
30
—
—
408 $
151 $
29
—
11
87
278 $
92
265
—
136
32
10
14
549
178
61
11
—
97
347
(1) As of September 30, 2019, Sasol-Huntsman was no longer accounted for as a variable interest entity.
The revenues, income from continuing operations before income taxes and net cash provided by operating
activities for our variable interest entities are as follows (dollars in millions):
Year ended December 31,
2018
2017
2019(1)
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Income from continuing operations before income taxes . . . . . .
Net cash provided by operating activities . . . . . . . . . . . . . . . . . .
95 $
17
81
154 $
40
65
132
25
51
(1) As of September 30, 2019, Sasol-Huntsman was no longer accounted for as a variable interest entity.
Therefore, this financial data only includes information for Sasol-Huntsman applicable to the period
from January 1, 2019 through September 30, 2019.
49
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
9. LEASES
On January 1, 2019, we adopted the new lease standard using the optional transition method provided under
ASU No. 2018-11, which allowed us to initially apply the amendments of the new lease standard at the adoption date.
Upon adoption of the new lease standard, we elected the package of three practical expedient permitted under the
transition guidance within the new lease standard, which among other things, allowed us to carry forward the historical
lease classification on existing leases at adoption. In addition, we elected the practical expedient related to land
easements, which allowed us to carry forward our accounting treatment for land easements on existing agreements. We
also elected the hindsight practical expedient to determine the lease term for existing leases.
The determination of whether a contract is or contains a lease is performed at the lease inception date. Lease
right-of-use assets and lease liabilities are recognized at the lease commencement date based on the present value of
lease payments over the lease term, using incremental borrowing rates as the implicit rates are not readily determinable
for our leases. The incremental borrowing rates are determined on a collateralized basis and vary from lease to lease
depending on the country where the leased asset exists and the term of the lease arrangement. We combine lease
components with non-lease components and account for them as a single lease component for all classes of underlying
assets, except for leases of manufacturing and research facilities and administrative offices. For these assets, non-lease
components are separated from lease components and accounted for as normal operating expenses.
We primarily lease manufacturing and research facilities, administrative offices, land, tanks, railcars and
equipment. Leases with an initial term of 12 months or less are not recognized on the balance sheet; we recognize lease
expense for these leases on a straight-line basis over the lease term. Our variable lease cost was nil for the year ended
December 31, 2019. Our leases have remaining lives from one month to 38 years. Certain lease agreements include one
or more options to renew, at our discretion, with renewal terms that can extend the lease term by approximately one year
to 30 years or more. Renewal and termination options that we are reasonably certain to exercise have been included in
the calculation of the lease right-of-use assets and lease liabilities. None of our lease agreements contain material
residual value guarantees or material restrictions or covenants.
The components of operating lease expense, cash flows and supplemental noncash information from continuing
operations are as follows (dollars in millions):
Year ended
December 31, 2019
Operating lease expense:
Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Selling, general and administrative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Research and development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total operating lease expense(1)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases . . . . . . . . . . . . . . . . . . . . . . . . . . $
35
15
6
56
53
Supplemental noncash information:
Leased assets obtained in exchange for new operating lease liabilities . . . . $
416
(1) Total operating lease expense includes short-term lease expense of approximately $1 million for the
year ended December 31, 2019.
(2) Total operating lease expense for the years ended December 31, 2018 and 2017 were $55 million and
$60 million, respectively.
50
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
9. LEASES (Continued)
The weighted-average lease term and discount rate for our operating leases from continuing operations are as
follows:
Weighted-average remaining lease term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted-average discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11 years
4.1%
The undiscounted future cash flows of operating lease liabilities from continuing operations as of December 31,
2019 are as follows (dollars in millions):
Year ending December 31,
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total lease payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less imputed interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
58
57
52
48
45
268
528
(102)
426
Future minimum lease payments under operating leases from continuing operations as of December 31, 2018
are as follows (dollars in millions):
Year ending December 31,
2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
37
33
36
34
32
224
396
As of December 31, 2019, we have additional leases, primarily for leases of manufacturing facilities, that have
not yet commenced of approximately $43 million. These leases will commence beginning in 2020 through 2021 with
lease terms of up to 20 years.
10. INTANGIBLE ASSETS
The gross carrying amount and accumulated amortization of intangible assets were as follows (dollars in
millions):
December 31, 2019
Carrying Accumulated
Amount
Amortization Net
December 31, 2018
Carrying Accumulated
Amount
Amortization Net
Patents, trademarks and
technology . . . . . . . . . . . . . . . . $ 314 $
230 $ 84 $ 293 $
Licenses and other agreements . .
Non-compete agreements . . . . . .
Other intangibles . . . . . . . . . . . . .
Total. . . . . . . . . . . . . . . . . . . . . . . $ 518 $
140
3
61
48
2
41
92
1
20
134
3
64
321 $ 197 $ 494 $
209 $ 84
105
1
23
281 $ 213
29
2
41
51
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
10. INTANGIBLE ASSETS (Continued)
Amortization expense was $16 million, $6 million and $3 million for the years ended December 31, 2019, 2018
and 2017, respectively.
Our estimated future amortization expense for intangible assets over the next five years is as follows (dollars in
millions):
Year ending December 31,
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 16
15
2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15
2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15
2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15
2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11. OTHER NONCURRENT ASSETS
Other noncurrent assets consisted of the following (dollars in millions):
Capitalized turnaround costs, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Catalyst assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
223 $
24
205
452 $
172
26
195
393
December 31,
2019
2018
Amortization expense of catalyst assets for the years ended December 31, 2019, 2018 and 2017 was $9 million,
$10 million and $7 million, respectively.
12. ACCRUED LIABILITIES
Accrued liabilities consisted of the following (dollars in millions):
Payroll and related accruals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Taxes other than income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Volume and rebate accruals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other miscellaneous accruals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
100 $
64
59
53
144
420 $
126
44
86
59
182
497
December 31,
2019
2018
13. RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING (CREDITS) COSTS
2019 RESTRUCTURING ACTIVITIES
In September 2011, we implemented the Textile Effects Restructuring Plan, including the closure of our
production facilities and business support offices in Basel, Switzerland. In connection with this plan, in July 2019, we
sold the production facilities and business support offices in Basel. Accordingly, during the third quarter of 2019, we
received proceeds of $49 million related to this sale and recognized a corresponding gain on disposal of assets of $49
million.
52
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
13. RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING (CREDITS) COSTS (Continued)
2018 RESTRUCTURING ACTIVITIES
In September 2011, we implemented the Textile Effects Restructuring Plan. In connection with this plan, we
recorded restructuring reserves covering, among other things, a non-cancelable long-term service agreement. In the
fourth quarter of 2018, we settled this agreement in exchange for the payment of $10 million, $8 million of which was
paid in 2019 and $2 million will be paid in 2023. In connection with this settlement, we reversed the related restructuring
reserve and recorded a net credit of $29 million in the fourth quarter of 2018. In addition, during 2018, we recorded a
credit of $4 million primarily related to a gain on the sale of land at the Basel, Switzerland site.
Our Corporate and other segment recorded restructuring expense of $15 million in 2018 related to corporate
initiatives.
2017 RESTRUCTURING ACTIVITIES
In September 2011, we implemented the Textile Effects Restructuring Plan. In connection with this
restructuring plan, during the year ended December 31, 2017, our Textile Effects segment recorded restructuring expense
of approximately $6 million associated with this initiative, including $2 million for non-cancelable long-term contract
termination costs and $4 million for decommissioning.
During the first quarter of 2017, we implemented a restructuring program to improve competitiveness in our
Textile Effects segment. In connection with this restructuring program, we recorded restructuring expense of $7 million
in the year ended December 31, 2017 related primarily to workforce reductions.
14. OTHER NONCURRENT LIABILITIES
Other noncurrent liabilities consisted of the following (dollars in millions):
Pension liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Other postretirement benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Employee benefit accrual . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
December 31,
2019
650 $
55
38
155
898 $
2018
664
54
32
199
949
53
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
15. DEBT
Outstanding debt, net of debt issuance costs, of consolidated entities consisted of the following (dollars in
millions):
Senior Credit Facilities:
December 31,
2019
December 31,
2018
Revolving facility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Amounts outstanding under A/R programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Term loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Senior notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Variable interest entities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Total current portion of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Long-term portion of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
40 $
167
103
1,963
65
51
2,389 $
212 $
2,177
2,389 $
50
252
—
1,892
86
40
2,320
96
2,224
2,320
DIRECT AND SUBSIDIARY DEBT
Our direct debt and guarantee obligations consist of a guarantee of certain indebtedness incurred from time to
time to finance certain insurance premiums. Substantially all of our other debt, including the facilities described below,
has been incurred by our subsidiaries (primarily Huntsman International); we are not a guarantor of such subsidiary debt.
Certain of our subsidiaries are designated as nonguarantor subsidiaries and have third-party debt agreements.
These debt agreements contain certain restrictions with regard to dividends, distributions, loans or advances. In certain
circumstances, the consent of a third party would be required prior to the transfer of any cash or assets from these
subsidiaries to us.
Debt Issuance Costs
We record debt issuance costs related to a debt liability on the balance sheet as a reduction in the face amount of
that debt liability. As of December 31, 2019 and 2018, the amount of debt issuance costs directly reducing the debt
liability was $11 million and $8 million, respectively. We record the amortization of debt issuance costs as interest
expense.
Revolving Credit Facility
On May 21, 2018, we entered into the 2018 Revolving Credit Facility. Borrowings under the 2018 Revolving
Credit Facility will bear interest at the rates specified in the credit agreement governing the 2018 Revolving Credit
Facility, which will vary based on the type of loan and our debt ratings. Unless earlier terminated, the 2018 Revolving
Credit Facility will mature in May 2023. We may increase the 2018 Revolving Credit Facility commitments up to an
additional $500 million, subject to the satisfaction of certain conditions.
In connection with entering into the 2018 Revolving Credit Facility, we terminated all commitments and repaid
all obligations under the Prior Credit Facility. In addition, we recognized a loss of early extinguishment of debt of $3
million. Upon the termination of the Prior Credit Facility, all guarantees of the obligations under the Prior Credit Facility
54
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
15. DEBT (Continued)
were terminated, and all liens granted under the Prior Credit Facility were released. As of December 31, 2019, our 2018
Revolving Credit Facility was as follows (dollars in millions):
Facility
2018 Revolving Credit Facility . $ 1,200
Committed
Amount Outstanding
$
40 (1) $
— (1) $
Maturity
Interest Rate(2)
40 (1) USD LIBOR plus 1.50% 2023
Unamortized
Discounts and
Principal Debt Issuance Carrying
Costs
Value
(1) On December 31, 2019, we had an additional $7 million (U.S. dollar equivalents) of letters of credit and bank
guarantees issued and outstanding under our 2018 Revolving Credit Facility.
(2) Interest rates on borrowings under the 2018 Revolving Credit Facility vary based on the type of loan and our debt
ratings. The then applicable interest rate as of December 31, 2019 was 1.50% above LIBOR.
Term Loan Credit Facility
On September 24, 2019, we entered into the 2019 Term Loan, pursuant to which we borrowed an aggregate
principal amount of €92 million (or $101 million equivalent). We used the net proceeds from the 2019 Term Loan to
finance our acquisition of the 50% noncontrolling interest that we did not own in the Sasol-Huntsman maleic anhydride
joint venture. Borrowings under the 2019 Term Loan will bear interest at an interest rate of EURIBO Rate plus 0.75%,
with a EURIBO Rate floor at zero. Unless earlier terminated or prepaid in accordance with the credit agreement
governing the 2019 Term Loan, the 2019 Term Loan will mature on September 22, 2020. The 2019 Term Loan is subject
to substantially the same terms and conditions as the 2018 Revolving Credit Facility.
A/R Programs
Our A/R Programs are structured so that we transfer certain of our trade receivables to the U.S. special purpose
entity (“U.S. SPE”) and the European special purpose entity (“EU SPE”) in transactions intended to be true sales or true
contributions. The receivables collateralize debt incurred by the U.S. SPE and the EU SPE.
On April 18, 2019, we entered into amendments to the EU A/R Program (the “European Amendment”) and the
U.S. A/R Program (the “U.S. Amendment”). The European Amendment, among other things, extended the scheduled
commitment termination date of the loan facility to April 2022, reduced the facility maximum funding availability from
€150 million to €100 million and made certain other amendments. The U.S. Amendment, among other things, extended
the scheduled commitment termination date of the loan facility to April 2022 and made certain other amendments.
Information regarding our A/R Programs as of December 31, 2019 was as follows (monetary amounts in
millions):
Facility
U.S. A/R Program . . . April 2022 $
EU A/R Program . . . . April 2022 €
Maturity
Maximum Funding
Availability(1)
250
100
(or approximately $112)
Amount
Outstanding
100
60
(or approximately $67)
$
€
Interest Rate(2)
(3) Applicable rate plus 0.90%
Applicable rate plus 1.30%
(1) The amount of actual availability under our A/R Programs may be lower based on the level of eligible receivables
sold, changes in the credit ratings of our customers, customer concentration levels and certain characteristics of the
accounts receivable being transferred, as defined in the applicable agreements.
(2) The applicable rate for our U.S. A/R Program is defined by the lender as USD LIBOR. The applicable rate for our
EU A/R Program is either GBP LIBOR, USD LIBOR or EURIBOR.
55
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
15. DEBT (Continued)
(3) As of December 31, 2019, we had approximately $5 million (U.S. dollar equivalents) of letters of credit issued and
outstanding under our U.S. A/R Program.
In December 2019, we entered into amendments to the U.S. A/R program and the EU A/R program. The
European amendment allowed the removal of pledged obligors related to the Chemical Intermediates Businesses sold to
Indorama. The U.S. amendment allowed the removal of pledged obligors related to the Chemical Intermediates
Businesses sold to Indorama as well as reduced the maximum funding capacity from $250 million to $150 million upon
completion of the sale on January 3, 2020.
As of December 31, 2019 and December 31, 2018, $221 million and $341 million, respectively, of accounts
receivable were pledged as collateral under our A/R Programs.
Notes
As of December 31, 2019, we had outstanding the following notes (monetary amounts in millions):
Unamortized
Premiums,
Discounts
and Debt
Notes
2021 Senior Notes . . . . . . . . . . . . .
2022 Senior Notes . . . . . . . . . . . . . November 2022
2025 Senior Notes . . . . . . . . . . . . .
2029 Senior Notes . . . . . . . . . . . . . February 2029
Maturity
April 2021
April 2025
Interest Rate
Amount Outstanding
5.125 % €445 (€445 carrying value $(496)) $ —
(2)
$400 ($398 carrying value)
5.125 %
4.250 % €300 (€298 carrying value $(333))
(2)
(14)
4.500 %
$750 ($736 carrying value)
Issuance Costs
The 2021, 2022, 2025 and 2029 Senior Notes are general unsecured senior obligations of ours. The indentures
impose certain limitations on our ability to, among other things, incur additional indebtedness secured by any principal
properties, incur indebtedness of nonguarantor subsidiaries, enter into sale and leaseback transactions with respect to any
principal properties and consolidate or merge with or into any other person or lease, sell or transfer all or substantially all
of our properties and assets. Upon the occurrence of certain change of control events, holders of the 2021, 2022, 2025
and 2029 Senior Notes will have the right to require that we purchase all or a portion of such holder’s notes in cash at a
purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest to the date of repurchase.
On March 13, 2019, we completed a $750 million offering of our 2029 Senior Notes. On March 27, 2019, we
applied the net proceeds of the offering of the 2029 Senior Notes to redeem in full $650 million in aggregate principal
amount of our 2020 Senior Notes and also paid associated costs and accrued interest of $21 million and $12 million,
respectively. In addition, we recognized a loss on early extinguishment of debt of $23 million.
The 2029 Senior Notes bear interest at 4.50% per year, payable semi-annually on May 1 and November 1, and
will mature on May 1, 2029. We may redeem the 2029 Senior Notes in whole or in part at any time prior to February 1,
2029 at a price equal to 100% of the principal amount thereof plus a “make-whole” premium and accrued and unpaid
interest. We may redeem the 2029 Senior Notes at any time, in whole or from time to time in part, on or after February 1,
2029 at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid
interest.
Variable Interest Entity Debt
As of December 31, 2019, AAC, our consolidated 50%-owned joint venture, had $65 million outstanding under
its loan commitments and debt financing arrangements. As of December 31, 2019, we have $36 million classified as
current debt and $29 million as long-term debt on our consolidated balance sheets. We do not guarantee these loan
commitments, and AAC is not a guarantor of any of our other debt obligations.
56
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
15. DEBT (Continued)
COMPLIANCE WITH COVENANTS
Our 2018 Revolving Credit Facility contains a financial covenant regarding the leverage ratio of Huntsman
International and its subsidiaries. The 2018 Revolving Credit Facility also contains other customary covenants and
events of default for credit facilities of this type. Upon an event of default that is not cured or waived within any
applicable cure periods, in addition to other remedies that may be available to the lenders, the obligations under the 2018
Revolving Credit Facility may be accelerated.
The agreements governing our A/R Programs also contain certain receivable performance metrics. Any material
failure to meet the applicable A/R Programs’ metrics could lead to an early termination event under the A/R Programs,
which could require us to cease our use of such facilities, prohibiting us from additional borrowings against our
receivables or, at the discretion of the lenders, requiring that we repay the A/R Programs in full. An early termination
event under the A/R Programs would also constitute an event of default under our 2018 Revolving Credit Facility, which
could require us to pay off the balance of the 2018 Revolving Credit Facility in full and could result in the loss of our
2018 Revolving Credit Facility.
We believe that we are in compliance with the covenants governing our material debt instruments, including our
2018 Revolving Credit Facility, our A/R Programs and our notes.
MATURITIES
The scheduled maturities of our debt (excluding debt to affiliates) by year as of December 31, 2019 are as
follows (dollars in millions):
Year ending December 31,
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
212
522
570
1
2
1,082
2,389
16. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
We are exposed to market risks, such as changes in interest rates, foreign exchange rates and commodity prices.
From time to time, we enter into transactions, including transactions involving derivative instruments, to manage certain
of these exposures. We also hedge our net investment in certain European operations. Changes in the fair value of the
hedge in the net investment of certain European operations are recorded in accumulated other comprehensive loss.
In connection with the December 3, 2018 sale of Venator ordinary shares to Bank of America N.A., we
recorded a forward swap. See “Note 4. Discontinued Operations and Business Dispositions—Separation and
Deconsolidation of Venator” and “Note 17. Fair Value.”
INTEREST RATE RISK
Through our borrowing activities, we are exposed to interest rate risk. Such risk arises due to the structure of
our debt portfolio, including the mix of fixed and floating interest rates. Actions taken to reduce interest rate risk include
managing the mix and rate characteristics of various interest-bearing liabilities, as well as entering into interest rate
derivative instruments.
57
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
16. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Continued)
From time to time, we may purchase interest rate swaps and/or other derivative instruments to reduce the impact
of changes in interest rates on our floating-rate exposures. Under interest rate swaps, we agree with other parties to
exchange, at specified intervals, the difference between fixed-rate and floating-rate interest amounts calculated by
reference to an agreed notional principal amount. On January 9, 2019, we entered into a six-year $17 million notional
value interest rate hedge with a fixed rate of 2.66%. This swap was designated as a cash flow hedge and the effective
portion of the changes in the fair value of the swap was recorded in other comprehensive (loss) income. In
November 2019, we terminated this swap and paid $1 million to our counterparties. This $1 million settlement will be
amortized from accumulated other comprehensive loss to earnings.
During 2019, there were no other reclassifications from accumulated other comprehensive loss to earnings. The
actual amount that will be reclassified to earnings over the next twelve months may vary from this amount due to
changing market conditions. We would be exposed to credit losses in the event of nonperformance by a counterparty to
our derivative financial instruments. We anticipate, however, that the counterparties will be able to fully satisfy their
obligations under the contracts. Market risk arises from changes in interest rates.
FOREIGN EXCHANGE RATE RISK
Our cash flows and earnings are subject to fluctuations due to exchange rate variation. Our revenues and
expenses are denominated in various currencies. We enter into foreign currency derivative instruments to minimize the
short-term impact of movements in foreign currency rates. Where practicable, we generally net multicurrency cash
balances among our subsidiaries to help reduce exposure to foreign currency exchange rates. Certain other exposures
may be managed from time to time through financial market transactions, principally through the purchase of spot or
forward foreign exchange contracts (generally with maturities of three months or less). We do not hedge our currency
exposures in a manner that would eliminate the effect of changes in exchange rates on our cash flows and earnings. As of
December 31, 2019 and 2018, we had approximately $135 million and $151 million, respectively, notional amount (in
U.S. dollar equivalents) outstanding in foreign currency contracts with a term of approximately one month.
In November 2014, we entered into two five-year cross-currency interest rate contracts and one eight-year
cross-currency interest rate contract to swap an aggregate notional $200 million for an aggregate notional €161 million.
The swap was designated as a hedge of net investment for financial reporting purposes. In August 2017, we terminated
these cross-currency interest rate contracts and received $7 million from the counterparties.
A portion of our debt is denominated in euros. We also finance certain of our non-U.S. subsidiaries with
intercompany loans that are, in many cases, denominated in currencies other than the entities’ functional currency. We
manage the net foreign currency exposure created by this debt through various means, including cross-currency swaps,
the designation of certain intercompany loans as permanent loans because they are not expected to be repaid in the
foreseeable future and the designation of certain debt and swaps as net investment hedges.
Foreign currency transaction gains and losses on intercompany loans that are not designated as permanent loans
are recorded in earnings. Foreign currency transaction gains and losses on intercompany loans that are designated as
permanent loans are recorded in other comprehensive (loss) income. From time to time, we review such designation of
intercompany loans.
We review our non-U.S. dollar denominated debt and derivative instruments to determine the appropriate
amounts designated as hedges. As of December 31, 2019, we have designated approximately €435 million
(approximately $485 million) of euro-denominated debt as a hedge of our net investment. For the years ended
December 31, 2019, 2018 and 2017, the amounts recognized on the hedge of our net investment were a gain of $14
million, a gain of $35 million and a loss of $96 million, respectively, and were recorded in other comprehensive (loss)
income.
58
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
16. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Continued)
COMMODITY PRICES RISK
Inherent in our business is exposure to price changes for several commodities. However, our exposure to
changing commodity prices is somewhat limited since the majority of our raw materials are acquired at posted or market
related prices, and sales prices for many of our finished products are at market related prices which are largely set on a
monthly or quarterly basis in line with industry practice. Consequently, we do not generally hedge our commodity
exposures.
17. FAIR VALUE
The fair values of our financial instruments were as follows (dollars in millions):
December 31, 2019
December 31, 2018
Non-qualified employee benefit plan investments . . . . . . . . . . . . . . . . . . $
Forward swap contract related to the sale of investment in Venator . . . .
Long-term debt (including current portion) . . . . . . . . . . . . . . . . . . . . . . .
Value
Carrying Estimated Carrying Estimated
Fair Value
23
14
(2,403)
Fair Value Value
28 $
—
(2,544)
28 $
—
(2,389)
23 $
14
(2,320)
The carrying amounts reported in the balance sheets of cash and cash equivalents, accounts receivable and
accounts payable approximate fair value because of the immediate or short-term maturity of these financial instruments.
We elected the fair value option to account for our equity method investment in Venator post deconsolidation. The fair
value of our remaining investment in Venator reported in investment in unconsolidated affiliates is obtained through
market observable pricing using prevailing market prices (Level 1). See “Note 4. Discontinued Operations and Business
Dispositions—Separation and Deconsolidation of Venator.” The fair values of non-qualified employee benefit plan
investments are obtained through market observable pricing using prevailing market prices. The estimated fair values of
our long-term debt are based on quoted market prices for the identical liability when traded as an asset in an active
market (Level 1).
The fair value estimates presented herein are based on pertinent information available to management as of
December 31, 2019 and 2018. Although management is not aware of any factors that would significantly affect the
estimated fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial
statements since December 31, 2019, and current estimates of fair value may differ significantly from the amounts
presented herein.
The following assets and liabilities are measured at fair value on a recurring basis (dollars in millions):
Fair Value Amounts Using
Quoted prices Significant other
Significant
Description
Assets:
Equity securities:
2019
December 31,
in active markets
for identical
assets (Level 1)
observable
inputs
(Level 2)
unobservable
inputs
(Level 3)
Non-qualified employee benefit plan investments . . . . . . $
28 $
28 $
— $
—
59
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
17. FAIR VALUE (Continued)
Fair Value Amounts Using
Quoted prices Significant other
Significant
Description
Assets:
Equity securities:
2018
December 31,
in active markets
for identical
assets (Level 1)
observable
inputs
(Level 2)
unobservable
inputs
(Level 3)
Non-qualified employee benefit plan investments . . . . . . $
23 $
23 $
— $
—
Derivatives:
Forward swap contract related to the sale of
investment in Venator(1) . . . . . . . . . . . . . . . . . . . . . . . .
$
14
37 $
—
23 $
14
14 $
—
—
(1) In connection with the December 3, 2018 sale of Venator ordinary shares to Bank of America N.A., we recorded a
forward swap. In February 2019, we settled this forward swap and received $16 million from the counterparty.
During the years ended December 31, 2019 and 2018, there were no instruments measured at fair value on a
recurring basis using significant unobservable inputs (Level 3), and there were no gains or losses (realized or unrealized)
included in earnings for instruments categorized as Level 3 within the fair value hierarchy.
18. REVENUE RECOGNITION
We generate substantially all of our revenues through sales in the open market and long-term supply
agreements. We recognize revenue when control of the promised goods is transferred to our customers. Control of goods
usually passes to the customer at the time shipment is made. Revenue is measured as the amount that reflects the
consideration that we expect to be entitled to in exchange for those goods. Sales, value add, and other taxes we collect
concurrent with revenue-producing activities are excluded from revenue. Incidental items that are immaterial in the
context of the contract are recognized as expense. We have elected to account for all shipping and handling activities as
fulfillment costs. We have also elected to expense commissions when incurred as the amortization period of the
commission asset that we would have otherwise recognized is less than one year.
60
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
18. REVENUE RECOGNITION (Continued)
The following table disaggregates our revenue by major source for the years ended December 31, 2019 and
2018 (dollars in millions):
2019
Primary Geographic Markets(1)
U.S. and Canada . . . . . . . . . . . . . . . . . . . . . $
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia Pacific . . . . . . . . . . . . . . . . . . . . . . . . .
Rest of world . . . . . . . . . . . . . . . . . . . . . . . .
$
Major Product Groupings
MDI urethanes . . . . . . . . . . . . . . . . . . . . . . . $
Differentiated . . . . . . . . . . . . . . . . . . . . . . . .
Specialty . . . . . . . . . . . . . . . . . . . . . . . . . . .
Non-specialty . . . . . . . . . . . . . . . . . . . . . . . .
Textile chemicals and dyes and digital inks .
Eliminations . . . . . . . . . . . . . . . . . . . . . . . . .
$
2018
Primary Geographic Markets(1)
U.S. and Canada . . . . . . . . . . . . . . . . . . . . . $
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia Pacific . . . . . . . . . . . . . . . . . . . . . . . . .
Rest of world . . . . . . . . . . . . . . . . . . . . . . . .
$
Major Product Groupings
MDI urethanes . . . . . . . . . . . . . . . . . . . . . . . $
Differentiated . . . . . . . . . . . . . . . . . . . . . . . .
Specialty . . . . . . . . . . . . . . . . . . . . . . . . . . .
Non-specialty . . . . . . . . . . . . . . . . . . . . . . . .
Textile chemicals and dyes and digital inks .
Eliminations . . . . . . . . . . . . . . . . . . . . . . . . .
$
Polyurethanes
Performance
Products
Advanced
Materials
Textile
Effects
Corporate
and
Eliminations
Total
1,475 $
1,051
1,078
307
3,911 $
531 $
316
248
63
1,158 $
289 $
410
269
76
1,044 $
62 $
128
446
127
763 $
(64) $
(9)
(2)
(4)
(79) $
2,293
1,896
2,039
569
6,797
3,911
$
1,158
$
$
891
153
$
763
3,911 $
1,158 $
1,044 $
$
763 $
(79)
(79) $
3,911
1,158
891
153
763
(79)
6,797
Polyurethanes
Performance
Products
Advanced
Materials
Textile
Effects
Corporate
and
Eliminations
Total
1,426 $
1,277
1,236
343
4,282 $
586 $
368
278
69
1,301 $
285 $
445
301
85
1,116 $
68 $
135
485
136
824 $
4,282
$
1,301
$
932
184
$
824
122 $
(16)
(24)
(1)
81 $
$
4,282 $
1,301 $
1,116 $
$
824 $
81
81 $
2,487
2,209
2,276
632
7,604
4,282
1,301
932
184
824
81
7,604
(1) Geographic information for revenues is based upon countries into which product is sold.
Substantially all of our revenue is generated through product sales in which revenue is recognized at a point in
time. At contract inception, we assess the goods and services, if any, promised in our contracts and identify a
performance obligation for each promise to transfer to the customer a good or service that is distinct. In substantially all
cases, a contract has a single performance obligation to deliver a promised good to the customer. Revenue is recognized
when control of the product is transferred to the customer (i.e., when our performance obligation is satisfied), which
typically occurs at shipment. Further, in determining whether control has transferred, we consider if there is a present
right to payment and legal title, along with risks and rewards of ownership having transferred to the customer.
The amount of consideration we receive and revenue we recognize is based upon the terms stated in the sales
contract, which may contain variable consideration such as discounts or rebates. We allocate the transaction price to each
distinct product based on their relative standalone selling price. The product price as specified on the purchase order or in
61
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
18. REVENUE RECOGNITION (Continued)
the sales contract is considered the standalone selling price as it is an observable input that depicts the price as if sold to a
similar customer in similar circumstances. In order to estimate the applicable variable consideration, we use historical
and current trend information to estimate the amount of discounts or rebates to which customers are likely to be entitled.
Historically, actual discount or rebate adjustments relative to those estimated and included when determining the
transaction price have not materially differed. Payment terms vary but are generally less than one year. As our standard
payment terms are less than one year, we have elected to not assess whether a contract has a significant financing
component. In the normal course of business, we do not accept product returns unless the item is defective as
manufactured. We establish provisions for estimated returns based on an analysis of historical experience.
19. EMPLOYEE BENEFIT PLANS
DEFINED BENEFIT AND OTHER POSTRETIREMENT BENEFIT
We provide a trusteed, non contributory defined benefit pension plan (the “Plan”) that covers the majority of
our U.S. employees. Effective July 1, 2004, the Plan formula for employees not covered by a collective bargaining
agreement was converted to a cash balance design. For represented employees, participation in the cash balance design
was subject to the terms of negotiated contracts. For participating employees, benefits accrued under the prior formula
were converted to opening cash balance accounts. The cash balance benefit formula provides annual pay credits from 6%
to 12% of eligible pay, depending on age and service, plus accrued interest. The conversion to the cash balance plan did
not have a significant impact on the accrued benefit liability, the funded status or ongoing pension expense.
Beginning July 1, 2014, the Huntsman Defined Benefit Pension Plan was closed to new non-union entrants and
as of April 1, 2015, it was closed to new union entrants. In addition, as of January 1, 2015, Rubicon LLC closed its
defined benefit plan to new entrants. Following the closure of these plans, new hires have been provided with a defined
contribution plan with a non-discretionary employer contribution of 6% of pay and a company match of up to 4% of pay,
for a total company contribution of up to 10% of pay. We also sponsor unfunded postretirement benefit plans other than
pensions, which provide medical and life insurance benefits. Effective August 1, 2015, the post retirement benefit plans
were closed to new entrants.
Our postretirement benefit plans provide access to two fully insured Medicare Part D plans including
prescription drug benefits affected by the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (the
“Act”). We cannot determine whether the medical benefits provided by our postretirement benefit plans are actuarially
equivalent to those provided by the Act. We do not collect a subsidy and our net periodic postretirement benefits cost,
and related benefit obligation, do not reflect an amount associated with the subsidy. We do not subsidize the premium
cost of these plans; the premiums are entirely paid by the retirees.
We sponsor defined benefit plans in a number of countries outside of the U.S. The availability of these plans,
and their specific design provisions, are consistent with local competitive practices and regulations.
62
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. EMPLOYEE BENEFIT PLANS (Continued)
The following table sets forth the funded status of our plans and the amounts recognized in our consolidated
balance sheets at December 31, 2019 and 2018 (dollars in millions):
Defined Benefit Plans
Other Postretirement Benefit Plans
2019
Non-U.S.
Plans
U.S.
Plans
2018
Non-U.S.
Plans
U.S.
Plans
2019
U.S. Non-U.S.
Plans
Plans
2018
U.S. Non-U.S.
Plans
Plans
Change in benefit obligation
Benefit obligation at beginning of
year . . . . . . . . . . . . . . . . . . . . . . . . . $ 956 $ 2,157 $ 1,028 $ 2,259 $ 59 $
Service cost . . . . . . . . . . . . . . . . . . . .
20
Interest cost . . . . . . . . . . . . . . . . . . . .
41
Participant contributions . . . . . . . . . —
Plan amendments . . . . . . . . . . . . . . . —
Foreign currency exchange rate
changes . . . . . . . . . . . . . . . . . . . . . . . —
20
Settlements/transfers/divestitures . .
Actuarial (gain) loss . . . . . . . . . . . . .
65
Benefits paid . . . . . . . . . . . . . . . . . . .
(78)
30
37
6
(9)
23
39
—
—
32
37
5
4
1
3
2
—
— $ 69 $
—
—
—
—
2
2
2
—
—
—
—
—
—
7
(2)
224
(73)
(74)
—
(3)
(6)
(30)
(67)
(61)
(73)
956 $ 2,157 $ 60 $
—
1
—
(6)
—
—
—
—
— $ 59 $
—
—
(9)
(7)
—
—
—
—
—
Benefit obligation at end of year . . . . . $ 1,024 $ 2,377 $
Change in plan assets
Fair value of plan assets at
beginning of year . . . . . . . . . . . . . . $ 697 $ 1,751 $
Actual return on plan assets . . . . . . .
Foreign currency exchange rate
107
224
747 $ 1,883 $ — $
(38)
(27)
—
— $ — $
—
—
—
—
changes . . . . . . . . . . . . . . . . . . . . . .
—
Participant contributions . . . . . . . . . —
19
Settlement/transfers/divestitures . . .
Company contributions . . . . . . . . . .
45
Benefits paid . . . . . . . . . . . . . . . . . . .
(78)
11
6
(2)
43
(73)
Fair value of plan assets at end of year . $ 790 $ 1,960 $
(62)
—
5
—
(3)
(6)
39
44
(73)
(61)
697 $ 1,751 $ — $
—
2
—
4
(6)
—
—
—
—
—
— $ — $
—
2
—
5
(7)
—
—
—
—
—
—
Funded status
Fair value of plan assets . . . . . . . . . . . . $ 790 $ 1,960 $
Benefit obligation . . . . . . . . . . . . . . . . . 1,024
Accrued benefit cost . . . . . . . . . . . . . . . $ (234) $ (417) $ (259) $ (406) $ (60) $
697 $ 1,751 $ — $
956
2,157
2,377
60
— $ — $
—
— $ (59) $
59
—
—
—
Amounts recognized in balance
sheet:
Noncurrent asset . . . . . . . . . . . . . . . . . . $ — $
Current liability . . . . . . . . . . . . . . . . . . .
(5)
Noncurrent liability . . . . . . . . . . . . . . . .
(229)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (234) $ (417) $ (259) $ (406) $ (60) $
— $
(5)
(254)
10 $
(6)
(421)
10 $ — $ — $ — $ —
—
—
(6)
—
—
(410)
— $ (59) $
—
(5)
(54)
(5)
(55)
63
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. EMPLOYEE BENEFIT PLANS (Continued)
Defined Benefit Plans
Other Postretirement Benefit Plans
2019
Non-U.S.
Plans
U.S.
Plans
2018
Non-U.S.
Plans
U.S.
Plans
2019
Non-U.S.
Plans
U.S.
Plans
2018
U.S. Non-U.S.
Plans
Plans
Amounts recognized in accumulated
other comprehensive loss:
Net actuarial loss . . . . . . . . . . . . . . . . . . . $ 394 $
Prior service credit . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 383 $
(11)
840 $ 401 $
(32)
808 $ 388 $
(13)
784 $ 20 $
(27)
757 $ (13) $
(33)
— $ 21 $
—
— $ (17) $
(38)
—
—
—
The amounts in accumulated other comprehensive loss that are expected to be recognized as components of net
periodic benefit cost of continuing operations during the next fiscal year are as follows (dollars in millions):
Defined Benefit Plans
Non-U.S.
Other Postretirement
Benefit Plans
Non-U.S.
Actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Prior service credit . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
28 $
(2)
26 $
53 $
(5)
48 $
1 $
(5)
(4) $
U.S. Plans
Plans
U.S. Plans
Plans
—
—
—
Components of net periodic benefit costs of continuing operations for the years ended December 31, 2019, 2018
and 2017 were as follows (dollars in millions):
Defined Benefit Plans
U.S. plans
2018
2019
2017
Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 20 $ 23 $ 22 $
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of prior service credit . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlement loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Special termination benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net periodic benefit cost (credit) . . . . . . . . . . . . . . . . . . . . . . . . . . $ 29 $ 39 $ 38 $
39
(48)
(2)
27
—
—
39
(54)
(2)
31
2
—
41
(53)
(2)
23
—
—
Non-U.S. plans
2018
2019
2017
30 $ 32 $ 33
35
37
37
(100)
(109)
(102)
(5)
(5)
(4)
45
38
45
—
—
1
1
—
—
9
7 $ (7) $
Other Postretirement Benefit Plans
2017
Non-U.S. plans
2018
2019
2017
2 $ — $ — $ —
—
3
—
(6)
3
—
2 $ — $ — $ —
—
—
—
—
—
—
Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of prior service credit . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net periodic benefit cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ — $
1 $
3
(5)
1
2 $
2
(5)
2
1 $
U.S. plans
2018
2019
64
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. EMPLOYEE BENEFIT PLANS (Continued)
The amounts recognized in net periodic benefit cost and other comprehensive income (loss) as of December 31,
2019, 2018 and 2017 were as follows (dollars in millions):
Defined Benefit Plans
U.S. plans
2018
2017
Non-U.S. plans
2018
2019
2017
2019
Current year actuarial loss (gain) . . . . . . . . . . . . . . . . . . . . . . . . . $ 19 $ 18 $ 42 $ 101 $ 117 $ (42)
(61)
Amortization of actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current year prior service (credits) cost . . . . . . . . . . . . . . . . . . .
(2)
Amortization of prior service credit . . . . . . . . . . . . . . . . . . . . . . .
4
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
Curtailment (gain)/loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3
Total recognized in other comprehensive income (loss) . . . . . .
(98)
37
Amounts related to discontinued operations . . . . . . . . . . . . . . . .
Total recognized in other comprehensive income (loss) in
(26)
—
2
—
—
(5)
9
(30)
—
2
—
—
14
—
(38)
4
5
—
—
88
—
(45)
(10)
4
1
—
51
—
(34)
—
2
(2)
—
(16)
(4)
continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net periodic benefit cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total recognized in net periodic benefit cost and other
4
29
(20)
39
14
38
51
7
88
(7)
(61)
9
comprehensive income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . $ 33 $ 19 $ 52 $ 58 $ 81 $ (52)
Other Postretirement Benefit Plans
U.S. plans
2018
2019
2017
2019
Non-U.S. plans
2018
2017
—
(1)
—
2
1
(1)
Current year actuarial loss (gain) . . . . . . . . . . . . . . . . . . . . . . . . . $ — $ (10) $ (12) $ — $ — $
Amortization of actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current year prior service credit . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of prior service credit . . . . . . . . . . . . . . . . . . . . . . .
Total recognized in other comprehensive income (loss) . . . . . .
Amounts related to discontinued operations . . . . . . . . . . . . . . . .
Total recognized in other comprehensive income (loss) in
—
—
—
—
—
(1)
—
5
4
(6)
—
—
—
—
—
(3)
—
6
(9)
—
(2)
—
6
(6)
—
continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net periodic benefit cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total recognized in net periodic benefit cost and other
(2)
—
(6)
1
(9)
2
—
—
—
—
—
—
comprehensive income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . $
(2) $
(5) $
(7) $ — $ — $
—
The following weighted-average assumptions were used to determine the projected benefit obligation at the
measurement date and the net periodic pension cost for the year:
Defined Benefit Plans
U.S. plans
2018
2019
2017
Non-U.S. plans
2018
2019
2017
Projected benefit obligation
Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Rate of compensation increase . . . . . . . . . . . . . . . . . . . . . . . .
3.59 % 4.39 % 3.74 % 1.07 % 1.75 % 1.65 %
4.09 % 4.10 % 4.10 % 2.65 % 2.95 % 3.38 %
Net periodic pension cost
Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Rate of compensation increase . . . . . . . . . . . . . . . . . . . . . . . .
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . .
4.39 % 3.74 % 4.24 % 1.75 % 1.65 % 1.82 %
4.07 % 4.10 % 4.14 % 2.64 % 3.38 % 3.51 %
7.52 % 7.52 % 7.53 % 5.89 % 5.88 % 5.68 %
65
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. EMPLOYEE BENEFIT PLANS (Continued)
Other Postretirement Benefit Plans
U.S. plans
2018
2019
2017
Non-U.S. plans
2018
2019
2017
Projected benefit obligation
Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3.46 % 4.26 % 3.58 % 2.90 % 3.50 % 3.30 %
Net periodic pension cost
Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4.26 % 3.58 % 4.04 % 3.50 % 3.30 % 3.50 %
At December 31, 2019 and 2018 the health care trend rate used to measure the expected increase in the cost of
benefits was assumed to be 6.50%, decreasing to 5% in 2025 and after. Assumed health care cost trend rates can have a
significant effect on the amounts reported for the postretirement benefit plans. A one-percent point change in assumed
health care cost trend rates would have the following effects (dollars in millions):
Asset category
Effect on total of service and interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ — $ —
Effect on postretirement benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1)
2
Increase Decrease
The projected benefit obligation and fair value of plan assets for the defined benefit plans with projected benefit
obligations in excess of plan assets as of December 31, 2019 and 2018 were as follows (dollars in millions):
Projected benefit obligation in excess of plan assets
Projected benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,024 $ 956 $ 2,203 $ 1,790
790 697 1,777 1,375
Fair value of plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. plans
2019
2018
Non-U.S. plans
2018
2019
The projected benefit obligation, accumulated benefit obligation and fair value of plan assets for the defined
benefit plans with an accumulated benefit obligation in excess of plan assets as of December 31, 2019 and 2018 were as
follows (dollars in millions):
Accumulated benefit obligation in excess of plan
assets
Projected benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,024 $ 956 $ 1,066 $ 986
Accumulated benefit obligation . . . . . . . . . . . . . . . . . . . . . . 1,019 935
991 919
664 608
790 697
Fair value of plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. plans
2019
2018
Non-U.S. plans
2018
2019
66
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. EMPLOYEE BENEFIT PLANS (Continued)
Expected future contributions and benefit payments related to continuing operations are as follows (dollars in
millions):
U.S. Plans
Other
Non-U.S. Plans
Other
Defined Postretirement Defined Postretirement
Benefit
Plans
Benefit
Plans
Benefit
Plans
Benefit
Plans
2020 expected employer contributions
To plan trusts . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 45 $
5 $ 38 $
Expected benefit payments
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2025 - 2029 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
59
62
65
69
98
325
5
5
5
5
5
24
78
77
81
85
84
447
—
—
—
—
—
—
—
Our investment strategy with respect to pension assets is to pursue an investment plan that, over the long term,
is expected to protect the funded status of the plan, enhance the real purchasing power of plan assets, and not threaten the
plan’s ability to meet currently committed obligations. Additionally, our investment strategy is to achieve returns on plan
assets, subject to a prudent level of portfolio risk. Plan assets are invested in a broad range of investments. These
investments are diversified in terms of domestic and international equities, both growth and value funds, including small,
mid and large capitalization equities; short-term and long-term debt securities; real estate; and cash and cash equivalents.
The investments are further diversified within each asset category. The portfolio diversification provides protection
against a single investment or asset category having a disproportionate impact on the aggregate performance of the plan
assets.
Our pension plan assets are managed by outside investment managers. The investment managers value our plan
assets using quoted market prices, other observable inputs or unobservable inputs. For certain assets, the investment
managers obtain third-party appraisals at least annually, which use valuation techniques and inputs specific to the
applicable property, market, or geographic location. During 2019, there were no transfers into or out of Level 3 assets.
We have established target allocations for each asset category. Our pension plan assets are periodically
rebalanced based upon our target allocations.
67
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. EMPLOYEE BENEFIT PLANS (Continued)
The fair value of plan assets for the pension plans was $2.8 billion and $2.4 billion at December 31, 2019 and
2018, respectively. The following plan assets are measured at fair value on a recurring basis (dollars in millions):
Asset category
U.S. pension plans:
Quoted prices in active
December 31, markets for identical
Significant other
observable inputs unobservable inputs
Significant
2019
assets (Level 1)
(Level 2)
(Level 3)
Fair Value Amounts Using
Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Fixed income . . . . . . . . . . . . . . . . . . . . . . . .
Real estate/other . . . . . . . . . . . . . . . . . . . . . .
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total U.S. pension plan assets. . . . . . . . . . $
422 $
301
67
—
790 $
Non-U.S. pension plans:
Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Fixed income . . . . . . . . . . . . . . . . . . . . . . . .
Real estate/other . . . . . . . . . . . . . . . . . . . . . .
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total Non-U.S. pension plan assets . . . . . $
535 $
847
505
73
1,960 $
283 $
220
—
—
503 $
228 $
560
99
72
959 $
139 $
81
—
—
220 $
307 $
287
349
1
944 $
—
—
67
—
67
—
—
57
—
57
Asset category
U.S. pension plans:
Quoted prices in active Significant other
Significant
December 31, Markets for identical
Observable inputs Unobservable inputs
2018
assets (Level 1)
(Level 2)
(Level 3)
Fair Value Amounts Using
Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Fixed income . . . . . . . . . . . . . . . . . . . . . . .
Real estate/other . . . . . . . . . . . . . . . . . . . . .
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total U.S. pension plan assets . . . . . . . . . $
349 $
283
65
—
697 $
Non-U.S. pension plans:
Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Fixed income . . . . . . . . . . . . . . . . . . . . . . .
Real estate/other . . . . . . . . . . . . . . . . . . . . .
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total Non-U.S. pension plan assets . . . . $
471 $
747
497
36
1,751 $
242 $
212
—
—
454 $
161 $
496
93
36
786 $
107 $
71
—
—
178 $
310 $
251
348
—
909 $
—
—
65
—
65
—
—
56
—
56
The following table reconciles the beginning and ending balances of plan assets measured at fair value using
unobservable inputs (Level 3) (dollars in millions):
Fair Value Measurements of Plan Assets Using Significant Unobservable
Inputs (Level 3)
Balance at beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Return on pension plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchases, sales and settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers into (out of) Level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Balance at end of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
121 $
4
(1)
—
124 $
117
4
—
—
121
Real Estate/Other
Year ended December 31,
2018
2019
68
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. EMPLOYEE BENEFIT PLANS (Continued)
Based upon historical returns, the expectations of our investment committee and outside advisors, the expected
long-term rate of return on the pension assets is estimated to be between 5.68% and 7.53%. The asset allocation for our
pension plans at December 31, 2019 and 2018 and the target allocation for 2020, by asset category are as follows:
Asset category
U.S. pension plans:
Target
Allocation
Allocation at December 31,
2020
2019
2018
Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fixed income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Real estate/other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total U.S. pension plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Non-U.S. pension plans:
Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fixed income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Real estate/other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total non-U.S. pension plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
53 %
39 %
5 %
3 %
100 %
31 %
44 %
15 %
10 %
100 %
54 %
38 %
8 %
— %
100 %
27 %
43 %
26 %
4 %
100 %
50 %
41 %
9 %
—
100 %
27 %
43 %
28 %
2 %
100 %
Equity securities in our pension plans did not include any direct investments in equity securities of our
Company or our affiliates at the end of 2019.
DEFINED CONTRIBUTION PLANS—U.S.
We had a money purchase pension plan that covered substantially all of our domestic employees who were
hired prior to January 1, 2004. Employer contributions were made based on a percentage of employees’ earnings
(ranging up to 8%). During 2014, we closed this plan to non-union participants, and in 2015, we closed this plan to union
associates. We continue to provide equivalent benefits to those who were covered under this plan into their salary
deferral account.
We have a salary deferral plan covering substantially all U.S. employees. Plan participants may elect to make
voluntary contributions to this plan up to a specified amount of their compensation. We contribute an amount equal to
the participant’s contribution, not to exceed 4 % of the participant’s compensation. For new hires who are not eligible for
the cash balance plan, and associates who were covered by the money purchase pension plan prior to its closure, we
contribute an additional amount into their salary deferral accounts, not to exceed 6% of the participant’s compensation.
Our total combined expense for the above defined contribution plans for each of the years ended December 31,
2019, 2018 and 2017 was $17 million, $16 million and $16 million, respectively.
DEFINED CONTRIBUTION PLANS—NON-U.S.
We have defined contribution plans in a variety of non-U.S. locations.
All UK associates are eligible to participate in the Huntsman UK Pension Plan, a contract–based arrangement
with a third party. Company contributions vary by business during a five-year transition period. Plan participants elect to
make voluntary contributions to this plan up to a specified amount of their compensation. We contribute a matching
amount not to exceed 12% of the participant’s salary for new hires and 15% of the participant’s salary for all other
participants.
Our total combined expense for these defined contribution plans for the years ended December 31, 2019, 2018
and 2017 was $4 million, $4 million and $5 million, respectively, primarily related to the Huntsman UK Pension Plan.
69
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. EMPLOYEE BENEFIT PLANS (Continued)
SUPPLEMENTAL SALARY DEFERRAL PLAN AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
The Huntsman Supplemental Savings Plan (the “SSP”) is a non-qualified plan covering key management
employees and allows participants to defer amounts that would otherwise be paid as compensation. The participant can
defer up to 75% of their salary and bonus each year. This plan also provides benefits that would be provided under the
Huntsman Salary Deferral Plan if that plan were not subject to legal limits on the amount of contributions that can be
allocated to an individual in a single year. The SSP was amended and restated effective as of January 1, 2005 to allow
eligible executive employees to comply with Section 409A of the Internal Revenue Code of 1986.
The Huntsman Supplemental Executive Retirement Plan (the “SERP”) is an unfunded non-qualified pension
plan established to provide certain executive employees with benefits that could not be provided, due to legal limitations,
under the Huntsman Defined Benefit Pension Plan, a qualified defined benefit pension plan, and the Huntsman Money
Purchase Pension Plan, a qualified money purchase pension plan.
Assets of these plans are included in other noncurrent assets and as of December 31, 2019 and 2018 were
$39 million and $32 million, respectively. During each of the years ended December 31, 2019, 2018 and 2017, we
expensed a total of $1 million as contributions to the SSP and the SERP.
STOCK-BASED INCENTIVE PLAN
On May 5, 2016, our stockholders approved a new Huntsman Corporation 2016 Stock Incentive Plan (the “2016
Stock Incentive Plan”), which reserved 8.2 million shares for issuance. The Huntsman Corporation Stock Incentive Plan,
as amended and restated (the “Prior Plan”), remains in effect for outstanding awards granted pursuant to the Prior Plan,
but no further awards may be granted under the Prior Plan. Under the 2016 Stock Incentive Plan, we may grant
nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock, phantom stock,
performance share units and other stock-based awards to our employees, directors and consultants and to employees and
consultants of our subsidiaries, provided that incentive stock options may be granted solely to employees. The terms of
the grants under both the 2016 Stock Incentive Plan and the Prior Plan are fixed at the grant date. As of December 31,
2019, we had approximately 8 million shares remaining under the 2016 Stock Incentive Plan available for grant. See
“Note 24. Stock-Based Compensation Plan.”
INTERNATIONAL PLANS
International employees are covered by various post-employment arrangements consistent with local practices
and regulations. Such obligations are included in other long-term liabilities in our consolidated balance sheets.
20. INCOME TAXES
The following is a summary of U.S. and non-U.S. provisions for current and deferred income taxes (dollars in
millions):
Year ended December 31,
2017
2018
2019
Income tax (benefit) expense:
U.S.
Current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (17) $ 57 $
Deferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(30)
(181)
23
(133)
Non-U.S.
Current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
71
89
153
(135)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (38) $ 45 $
88
42
20
70
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
20. INCOME TAXES (Continued)
The following schedule reconciles the differences between the U.S. federal income taxes at the U.S. statutory
rate to our provision for income taxes (dollars in millions):
Income from continuing operations before income taxes . . . . . . . . . . . . $
Expected tax expense at U.S. statutory rate of 21%, 21% and 35%,
2019
Year ended December 31,
2018
2017
391 $
734 $
531
respectively . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
82 $
154 $
186
Change resulting from:
State tax expense net of federal benefit . . . . . . . . . . . . . . . . . . . . . . .
Non-U.S. tax rate differentials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. Tax Reform Act impact . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Currency exchange gains/losses(net) . . . . . . . . . . . . . . . . . . . . . . . . .
Venator investment basis difference and fair market value
adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Tax losses related to Venator investment . . . . . . . . . . . . . . . . . . . . . .
Non-U.S. income subject to U.S. tax not offset by U.S. foreign
tax credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Tax authority audits and dispute resolutions . . . . . . . . . . . . . . . . . . .
Share-based compensation excess tax benefits . . . . . . . . . . . . . . . . .
Change in valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred tax effects of non-U.S. tax rate changes . . . . . . . . . . . . . . .
Impact of equity method investments . . . . . . . . . . . . . . . . . . . . . . . . .
Other non-U.S. tax effects, including nondeductible expenses
transfer pricing adjustments and various withholding taxes . . . . .
Other U.S. tax effects, including nondeductible expenses and
(3)
9
(1)
(5)
(199)
(18)
7
(6)
(4)
56
36
(13)
19
(1)
27
32
(10)
18
—
16
5
(14)
(185)
(2)
(14)
19
other credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total income tax (benefit) expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2
(38) $
—
45 $
(2)
(67)
(52)
15
—
—
—
9
(10)
(72)
4
(3)
3
9
20
During 2019 and 2018, the average statutory rate for countries with pre-tax income, primarily our operations in
China, Germany, India and Luxembourg, was higher than the average statutory rate for countries with pre-tax losses,
resulting in a net expense of $9 million and $27 million, respectively, as compared to the 21% U.S. statutory rate
reflected in the reconciliation above. During 2017, the average statutory rate for countries with pre-tax income, primarily
our Polyurethanes segment in The Netherlands, China and the U.K., as well as our Advanced Materials segment in
Switzerland and our Corporate segment in Luxembourg, was lower than the average statutory rate for countries with pre-
tax losses, almost all of which had statutory rates lower than the U.S. of 35%, resulting in net benefits as compared to the
U.S. statutory rate of $67 million, reflected in the reconciliation above. In certain non-U.S. tax jurisdictions, our U.S.
GAAP functional currency is different than the local tax currency. As a result, foreign exchange gains and losses will
impact our effective tax rate. For 2019, 2018 and 2017, this resulted in a $5 million tax benefit, a $10 million tax benefit
and a $15 million tax expense, respectively.
In 2019, we recorded $199 million of deferred tax assets in connection with our tax basis in our Venator
investment being greater than our book basis, which the deferred tax asset was partially offset by a valuation allowance
of $46 million (for a net tax benefit of $153 million), as further discussed below. Effective January 1, 2019, Switzerland
reduced certain conditional income tax rates resulting in a decrease in our net deferred tax assets and a corresponding
noncash income tax expense of $32 million for the year ended December 31, 2019.
The U.S. Tax Reform Act established new tax laws that affected 2019 and 2018, including, but not limited to, a
reduction of the U.S. federal corporate tax rate and the creation of the BEAT and GILTI provisions. Under U.S. GAAP,
we have elected to treat the GILTI as a current-period expense when incurred.
71
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
20. INCOME TAXES (Continued)
The stated purpose of the GILTI rules is to generate additional U.S. tax related to income in non-U.S.
jurisdictions which incur less than a blended 13.125% non-U.S. tax rate. Our non-U.S. income is subject to a blended
rate greater than 13.125%; however, in practice, the GILTI regulations result in additional tax liability as a result of
expense allocations which limit the ability to utilize foreign tax credits against the GILTI inclusion. For 2019 and 2018
we have incurred $ 7 million and $16 million of tax expense resulting from these expense allocations.
We recorded a net tax benefit of $20 million over 2017 and 2018 related to enactment of the U.S. Tax Reform
Act. As a result of the U.S. Tax Reform Act, we recorded a net tax benefit of $135 million due to remeasurement of
deferred U.S. tax assets and liabilities (including a provisional tax benefit of $137 million in 2017 offset by a final tax
expense of $2 million in 2018), offset by a tax expense of $115 million due to the transition tax on deemed repatriation
of deferred foreign income (including a provisional tax expense of $85 million in 2017 and a $30 million remeasurement
period adjustment in 2018). We did not make the election to reclassify the income tax effects of the U.S. Tax Reform Act
from accumulated other comprehensive income to retained earnings.
The components of income (loss) from continuing operations before income taxes were as follows (dollars in
millions):
Year ended December 31,
2017
2018
2019
U.S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (106) $ (38) $ (143)
Non-U.S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
674
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 391 $ 734 $ 531
497
772
Components of deferred income tax assets and liabilities were as follows (dollars in millions):
December 31,
2019
2018
Deferred income tax assets:
Net operating loss carryforwards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 281 $ 359
Pension and other employee compensation . . . . . . . . . . . . . . . . . . . . . . . .
180
Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
76
—
Basis difference in Venator investment . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
50
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 893 $ 680
172
15
56
199
98
72
Deferred income tax liabilities:
Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (218) $ (199)
Pension and other employee compensation . . . . . . . . . . . . . . . . . . . . . . . .
—
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(33)
Unrealized currency gains . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(37)
Operating leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(9)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (399) $ (278)
Net deferred tax asset before valuation allowance . . . . . . . . . . . . . . . . . . . . . $ 494 $ 402
Valuation allowance—net operating losses and other . . . . . . . . . . . . . . . . . .
(215)
Net deferred tax asset . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 263 $ 187
Non-current deferred tax asset . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
324
(137)
Non-current deferred tax liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net deferred tax asset . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 263 $ 187
(1)
(27)
(43)
(102)
(8)
292
(29)
(231)
72
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
20. INCOME TAXES (Continued)
We evaluate deferred tax assets to determine whether it is more likely than not that they will be realized.
Valuation allowances are reviewed each period on a tax jurisdiction by jurisdiction basis to analyze whether there is
sufficient positive or negative evidence to support a change in judgment about the realizability of the related deferred tax
assets. These conclusions require significant judgment. In evaluating the objective evidence that historical results
provide, we consider the cyclicality of businesses and cumulative income or losses during the applicable period.
Cumulative losses incurred over the period limits our ability to consider other subjective evidence such as our
projections for the future. Our judgments regarding valuation allowances are also influenced by the costs and risks
associated with any tax planning idea associated with utilizing a deferred tax asset.
We have gross net operating losses (“NOLs”) of $1,185 million in various non-U.S. jurisdictions. While the
majority of the non-U.S. NOLs have no expiration date, $175 million have a limited life (of which $162 million are
subject to a valuation allowance) and $88 million are scheduled to expire in 2020 (of which $87 million are subject to a
valuation allowance). We had $111 million and $91 million of NOLs expire unused in 2019 and 2018, respectively, all
of which were subject to a valuation allowance.
Included in the $1,185 million of gross non-U.S. NOLs is $581 million attributable to our Luxembourg entities.
As of December 31, 2019 due to the uncertainty surrounding the realization of the benefits of these losses, there is a
valuation allowance of $92 million against these net tax-effected NOLs of $145 million.
During 2019, based on our expectation that our remaining interest in Venator will be sold on or before
December 31, 2023, we recorded $153 million of deferred tax benefit relating to the portion of the $199 million tax basis
greater than book basis in our Venator investment. We expect to be able to utilize such future capital losses on our
Venator investment against capital gains anticipated on the sale of our Chemical Intermediates Businesses. We
established a valuation allowance of $46 million on the excess unrealizable built-in capital loss deferred tax asset. We
also realized $18 million of tax benefit relating to realized tax losses on our investment in Venator. During 2019, we also
established $11 million of valuation allowances on the remaining Australia NOLs that are no longer more-likely-than-not
realizable following the sale of the Australia portion of the Chemical Intermediates Businesses.
During 2018, we released valuation allowances of $132 million. We released significant valuation allowances
on certain net deferred tax assets in Switzerland based upon the increased and sustained profitability in our Advanced
Materials and Textile Effects businesses. Given Switzerland’s limited seven-year carryover of NOLs, we expect that
some of our NOLs will expire unused. Therefore, we recorded a partial release of the valuation allowance of $80 million
in the second quarter of 2018. In addition, based upon the separation of Venator from our U.K. combined group and the
increased and sustained profitability in our Polyurethanes business in the U.K., we released significant valuation
allowances on certain net deferred tax assets in the U.K. Because the U.K. places limitations on the utilization of certain
NOLs and limitations on other deferred tax assets, we recorded a partial valuation allowance release of $15 million in the
second quarter of 2018. We also released $24 million of significant valuation allowances on certain net deferred tax
assets in Luxembourg in the third quarter of 2018 as a result of changes in estimated future taxable income resulting
from increased intercompany receivables and, therefore, increased income in Luxembourg, our primary treasury center
outside of the U.S. We also had miscellaneous non-significant valuation allowance releases totaling $13 million in 2018.
During 2017, we released valuation allowances of $22 million. In Italy, we released valuation allowances of
$7 million on certain net deferred assets of our Polyurethanes business. On March 1, 2017 and April 1, 2017, we de-
merged the Italian legal entities containing our Polyurethanes business from our combined Italian tax group. The
historical and expected continued profitability of those Polyurethanes businesses resulted in the release of the associated
valuation allowance. In Luxembourg, we released valuation allowances of $15 million as a result of changes in estimated
future taxable income resulting from increased intercompany receivables and, therefore, increased income in
Luxembourg, our primary treasury center outside of the U.S.
Uncertainties regarding expected future income in certain jurisdictions could affect the realization of deferred
tax assets in those jurisdictions and result in additional valuation allowances in future periods, or, in the case of
unexpected pre-tax earnings, the release of valuation allowances in future periods.
73
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
20. INCOME TAXES (Continued)
The following is a summary of changes in the valuation allowance (dollars in millions):
2017
Valuation allowance as of January 1 . . . . . . . . . . . . . . . . . . . . . . . . . . $ 215 $ 412 $ 484
412
Valuation allowance as of December 31 . . . . . . . . . . . . . . . . . . . . . . . 231
72
(16)
Net (increase) decrease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign currency movements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11
—
(Decrease) increase to deferred tax assets with no impact on
operating tax expense, including an offsetting (decrease)
increase to valuation allowances . . . . . . . . . . . . . . . . . . . . . . . . . . . .
215
197
3
2018
2019
(40)
(15)
Change in valuation allowance per rate reconciliation . . . . . . . . . . . . $ (56) $ 185 $
Components of change in valuation allowance affecting tax
expense:
Pre-tax income and losses in jurisdictions with valuation
(11)
72
allowances resulting in no tax expense or benefit . . . . . . . . . . . . $ (133) $
53 $
Releases of valuation allowances in various jurisdictions . . . . . . .
Establishments of valuation allowances in various jurisdictions .
—
77
132
—
Change in valuation allowance per rate reconciliation . . . . . . . . . . . . $ (56) $ 185 $
50
22
—
72
The following is a reconciliation of our unrecognized tax benefits (dollars in millions):
Unrecognized tax benefits as of January 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Gross increases and decreases—tax positions taken during a prior period . .
Gross increases and decreases—tax positions taken during the current
period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Decreases related to settlements of amounts due to tax authorities . . . . . . . .
Reductions resulting from the lapse of statutes of limitation . . . . . . . . . . . . .
Foreign currency movements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unrecognized tax benefits as of December 31 . . . . . . . . . . . . . . . . . . . . . . . . $
2019
2018
26 $
4
23
1
1
—
(4)
1
28 $
3
—
—
(1)
26
As of December 31, 2019 and 2018, the amount of unrecognized tax benefits (not including interest and penalty
expense) which, if recognized, would affect the effective tax rate is $15 million and $23 million, respectively.
During 2019, we concluded and settled tax examinations in the U.S. (federal and various states). During 2018,
we concluded and settled tax examinations in various jurisdictions including but not limited to, Egypt and the U.S.
(federal and various states). During 2017, we concluded and settled tax examinations in various jurisdictions, including,
but not limited to, China and the U.S. (various states).
During 2019 for unrecognized tax benefits that impact tax expense, we recorded a net decrease in unrecognized
tax benefits with a corresponding income tax benefit (not including interest and penalty expense) of $10 million. During
2018 and 2017, for unrecognized tax benefits that impact tax expense, we recorded a net increase in unrecognized tax
benefits with a corresponding income tax expenses (not including interest and penalty expense) of $5 million and $9
million, respectively.
74
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
20. INCOME TAXES (Continued)
In accordance with our accounting policy, we continue to recognize interest and penalties accrued related to
unrecognized tax benefits in income tax expense.
Interest expense included in tax expense . . . . . . . . . . . . . . . . . . . . . . $
Penalties expense included in tax expense . . . . . . . . . . . . . . . . . . . .
Year ended December 31,
2017
2018
2019
—
2 $ — $
—
—
2
Accrued liability for interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Accrued liability for penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5 $
2
3
—
December 31,
2019
2018
We conduct business globally and, as a result, we file income tax returns in U.S. federal, various U.S. state and
various non-U.S. jurisdictions. The following table summarizes the tax years that remain subject to examination by
major tax jurisdictions:
Tax Jurisdiction
Open Tax Years
Belgium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2017 and later
China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2009 and later
Germany. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2014 and later
Hong Kong . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2013 and later
India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2004 and later
Italy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2015 and later
Mexico . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2014 and later
Switzerland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2013 and later
The Netherlands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2016 and later
Thailand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2012 and later
United Kingdom . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2017 and later
United States federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2017 and later
Certain of our U.S. and non-U.S. income tax returns are currently under various stages of audit by applicable
tax authorities and the amounts ultimately agreed upon in resolution of the issues raised may differ materially from the
amounts accrued.
We estimate that it is reasonably possible that certain of our non-U.S. unrecognized tax benefits could change
within 12 months of the reporting date with a resulting decrease in the unrecognized tax benefits within a reasonably
possible range of $12 million to $14 million. For the 12-month period from the reporting date, we would expect that a
substantial portion of the decrease in our unrecognized tax benefits would not result in a corresponding benefit to our
income tax expense.
The U.S. Tax Reform Act included a mandatory one-time tax on accumulated earnings of foreign subsidiaries,
and as a result, all previously unremitted earnings for which no U.S. deferred tax liability had been accrued have now
been subject to U.S. tax. For subsidiaries with local withholding taxes, we intend to continue to invest most of these
earnings indefinitely within the local country and do not expect to incur any significant, additional taxes related to such
amounts.
75
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
21. COMMITMENTS AND CONTINGENCIES
PURCHASE COMMITMENTS
We have various purchase commitments extending through 2039 for materials, supplies and services entered
into in the ordinary course of business. Included in the purchase commitments table below are contracts which require
minimum volume purchases that extend beyond one year or are renewable annually and have been renewed for 2019.
Certain contracts allow for changes in minimum required purchase volumes in the event of a temporary or permanent
shutdown of a facility. To the extent the contract requires a minimum notice period, such notice period has been included
in the table below. The contractual purchase prices for substantially all of these contracts are variable based upon market
prices, subject to annual negotiations. We have estimated our contractual obligations by using the terms of our current
pricing for each contract. We also have a limited number of contracts which require a minimum payment even if no
volume is purchased. We believe that all of our purchase obligations will be utilized in our normal operations. We made
minimum payments of $1 million, nil and nil for the years ended December 31, 2019, 2018 and 2017, respectively, under
such take or pay contracts without taking the product.
Total purchase commitments as of December 31, 2019 are as follows (dollars in millions):
Year ending December 31,
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,364
905
2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
751
2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
424
2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
416
2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,894
$ 5,754
LEGAL MATTERS
We are a party to various other proceedings instituted by private plaintiffs, governmental authorities and others
arising under provisions of applicable laws, including various environmental, products liability and other laws. Except as
otherwise disclosed in this report, we do not believe that the outcome of any of these matters will have a material effect
on our financial condition, results of operations or liquidity.
22. ENVIRONMENTAL, HEALTH AND SAFETY MATTERS
EHS CAPITAL EXPENDITURES
We may incur future costs for capital improvements and general compliance under environmental, health and
safety (“EHS”) laws, including costs to acquire, maintain and repair pollution control equipment. For the years ended
December 31, 2019, 2018 and 2017, our capital expenditures for EHS matters totaled $42 million, $32 million and
$32 million, respectively. Because capital expenditures for these matters are subject to evolving regulatory requirements
and depend, in part, on the timing, promulgation and enforcement of specific requirements, our capital expenditures for
EHS matters have varied significantly from year to year and we cannot provide assurance that our recent expenditures
are indicative of future amounts we may spend related to EHS and other applicable laws.
ENVIRONMENTAL RESERVES
We have accrued liabilities relating to anticipated environmental cleanup obligations, site reclamation and
closure costs and known penalties. Liabilities are recorded when potential liabilities are either known or considered
probable and can be reasonably estimated. Our liability estimates are calculated using present value techniques as
appropriate and are based upon requirements placed upon us by regulators, available facts, existing technology and past
experience. The environmental liabilities do not include amounts recorded as asset retirement obligations. We had
76
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
22. ENVIRONMENTAL, HEALTH AND SAFETY MATTERS (Continued)
accrued $4 million and $5 million for environmental liabilities as of December 31, 2019 and 2018, respectively. Of these
amounts, $1 million and $2 million were classified as accrued liabilities in our consolidated balance sheets as of
December 31, 2019 and 2018, respectively, and $3 million were classified as other noncurrent liabilities in our
consolidated balance sheets for both December 31, 2019 and 2018. In certain cases, our remediation liabilities may be
payable over periods of up to 30 years. We may incur losses for environmental remediation in excess of the amounts
accrued; however, we are not able to estimate the amount or range of such potential excess.
ENVIRONMENTAL MATTERS
Under the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”) and similar
state laws, a current or former owner or operator of real property in the U.S. may be liable for remediation costs
regardless of whether the release or disposal of hazardous substances was in compliance with law at the time it occurred,
and a current owner or operator may be liable regardless of whether it owned or operated the facility at the time of the
release. Outside the U.S., analogous contaminated property laws, such as those in effect in France and Australia, can
hold past owners and/or operators liable for remediation at former facilities. Currently, there are approximately six
former facilities or third-party sites in the U.S. for which we have been notified of potential claims against us for cleanup
liabilities, including, but not limited to, sites listed under CERCLA. Based on current information and past experiences at
other CERCLA sites, we do not expect these third-party claims to have a material impact on our consolidated financial
statements.
Under the Resource Conservation and Recovery Act (“RCRA”) in the U.S. and similar state laws, we may be
required to remediate contamination originating from our properties as a condition to our hazardous waste permit. Some
of our manufacturing sites have an extended history of industrial chemical manufacturing and use, including on-site
waste disposal. We are aware of soil, groundwater or surface contamination from past operations at some of our sites,
and we may find contamination at other sites in the future. For example, our Port Neches, Texas, and Geismar,
Louisiana, facilities are the subject of ongoing remediation requirements imposed under RCRA. Similar laws exist in a
number of locations in which we currently operate, or previously operated, manufacturing facilities, such as Australia,
India, France, Hungary and Italy.
North Maybe Mine Remediation
The North Maybe Canyon Mine site is a CERCLA site and involves a former phosphorous mine near Soda
Springs, Idaho, which is believed to have been operated by several companies, including a predecessor company to us. In
2004, the U.S. Forest Service notified us that we are a CERCLA potentially responsible party (“PRP”) for contamination
originating from the site. In February 2010, we and Wells Cargo (another PRP) agreed to conduct a Remedial
Investigation/Feasibility Study of a portion of the site and are currently engaged in that process. At this time, we are
unable to reasonably estimate our potential liabilities at this site.
23. HUNTSMAN CORPORATION STOCKHOLDERS’ EQUITY
SHARE REPURCHASE PROGRAM
On February 7, 2018 and on May 3, 2018, our Board of Directors authorized us to repurchase up to an
additional $950 million in shares of our common stock in addition to the $50 million remaining under our
September 2015 share repurchase authorization. The share repurchase program will be supported by our free cash flow
generation. Repurchases may be made through the open market, including through accelerated share repurchase
programs, or in privately negotiated transactions, and repurchases may be commenced or suspended from time to time
without prior notice. Shares of common stock acquired through the repurchase program are held in treasury at cost.
During the year ended December 31, 2019, we repurchased 10,099,892 of our common stock for approximately $208
million, excluding commissions, under the repurchase program. From January 1, 2020 through January 31, 2020, we
repurchased an additional 336,478 shares of our common stock for approximately $7 million, excluding commissions.
77
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
23. HUNTSMAN CORPORATION STOCKHOLDERS’ EQUITY (Continued)
DIVIDENDS ON COMMON STOCK
The following tables represent dividends on common stock for our Company for the years ended December 31,
2019 and 2018 (dollars in millions, except per share payment amounts):
2019
Approximate
Quarter ended
March 31, 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
June 30, 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
December 31, 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Per share
payment amount
amount
paid
0.1625 $
0.1625
0.1625
0.1625
39
38
38
35
2018
Approximate
Quarter ended
March 31, 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
June 30, 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
December 31, 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.1625 $
0.1625
0.1625
0.1625
39
39
39
39
Per share
payment amount
amount
paid
24. STOCK-BASED COMPENSATION PLAN
Under the 2016 Stock Incentive Plan, we may grant nonqualified stock options, incentive stock options, stock
appreciation rights, restricted stock, phantom stock, performance share units and other stock-based awards to our
employees, directors and consultants and to employees and consultants of our subsidiaries, provided that incentive stock
options may be granted solely to employees. The terms of the grants under both the 2016 Stock Incentive Plan and the
Prior Plan are fixed at the grant date. Initially, there were approximately 8.2 million shares available for issuance under
the 2016 Stock Incentive Plan. However, the number of shares available for issuance may be adjusted to include any
shares surrendered, exchanged, forfeited or settled in cash pursuant to the Prior Plan. As of December 31, 2019, we had
approximately 8 million shares remaining under the 2016 Stock Incentive Plan available for grant. Option awards have a
maximum contractual term of 10 years and generally must have an exercise price at least equal to the market price of our
common stock on the date the option award is granted. Outstanding stock-based awards generally vest over a three-year
period.
The compensation cost under the 2016 Stock Incentive Plan and the Prior Plan was as follows (dollars
in millions):
Year ended December 31,
2018
2017
2019
Compensation cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
29
$
27 $
36
The total income tax benefit recognized in the statement of operations for stock-based compensation
arrangements was $8 million, $18 million and $18 million for the years ended December 31, 2019, 2018 and 2017,
respectively.
STOCK OPTIONS
The fair value of each stock option award is estimated on the date of grant using the Black-Scholes valuation
model that uses the assumptions noted in the following table. Expected volatilities are based on the historical volatility of
our common stock through the grant date. The expected term of options granted was estimated based on the contractual
78
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
24. STOCK-BASED COMPENSATION PLAN (Continued)
term of the instruments and employees’ expected exercise and post-vesting employment termination behavior. The
risk-free rate for periods within the contractual life of the option was based on the U.S. Treasury yield curve in effect at
the time of grant. The assumptions noted below represent the weighted averages of the assumptions utilized for all stock
options granted during the year.
Dividend yield . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected volatility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Risk-free interest rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected life of stock options granted during the period . . . . . . . . . . . . . . .
2019
2.9 %
54.0 %
2.5 %
5.9 years
Year ended December 31,
2018
1.6 %
55.2 %
2.6 %
5.9 years
2019
2.4 %
56.9 %
2.0 %
5.9 years
A summary of stock option activity under the 2016 Stock Incentive Plan and the Prior Plan as of December 31,
2019 and changes during the year then ended is presented below:
Option Awards
Outstanding at January 1, 2019 . . . . . . . . . . . . . . . . . . . . . . . . . .
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Outstanding at December 31, 2019 . . . . . . . . . . . . . . . . . . . . . . .
Exercisable at December 31, 2019 . . . . . . . . . . . . . . . . . . . . . . . .
Weighted
Average
Exercise
Price
$ 17.81
22.66
11.19
25.59
19.08
16.90
Weighted
Average
Remaining
Contractual
Term
(years)
Aggregate
Intrinsic
Value
(in millions)
6.2 $
5.3
30
27
Shares
(in thousands)
4,545
896
(366)
(50)
5,025
3,600
The weighted-average grant-date fair value of stock options granted during 2019, 2018 and 2017 was $9.27,
$15.20 and $9.26 per option, respectively. As of December 31, 2019, there was $8 million of total unrecognized
compensation cost related to nonvested stock option arrangements granted under the 2016 Stock Incentive Plan and the
Prior Plan. That cost is expected to be recognized over a weighted-average period of approximately 1.8 years.
During the years ended December 31, 2019, 2018 and 2017, the total intrinsic value of stock options exercised
was approximately $4 million, $78 million and $48 million, respectively. Cash received from stock options exercised
during the years ended December 31, 2019, 2018 and 2017 was approximately $2 million, $17 million and $35 million,
respectively. The cash tax benefit from stock options exercised during the years ended December 31, 2019, 2018 and
2017 was approximately $1 million, $17 million, and $15 million, respectively.
NONVESTED SHARES
Nonvested shares granted under the 2016 Stock Incentive Plan and the Prior Plan consist of restricted stock and
performance share unit awards, which are accounted for as equity awards, and phantom stock, which is accounted for as
a liability award because it can be settled in either stock or cash.
The fair value of each performance share unit award is estimated using a Monte Carlo simulation model that
uses various assumptions, including an expected volatility rate and a risk-free interest rate. For the years ended
December 31, 2019, 2018 and 2017, the weighted-average expected volatility rate was 34.6%, 44.3% and 45.0%,
respectively, and the weighted average risk-free interest rate was 2.5%, 2.3% and 1.5%, respectively. For the
performance share unit awards granted during the years ended December 31, 2019, 2018 and 2017, the number of shares
earned varies based upon the Company achieving certain performance criteria over a three-year performance period. The
performance criteria are total stockholder return of our common stock relative to the total stockholder return of a
specified industry peer group for the three-year performance periods.
79
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
24. STOCK-BASED COMPENSATION PLAN (Continued)
A summary of the status of our nonvested shares as of December 31, 2019 and changes during the year then
ended is presented below:
Equity Awards
Liability Awards
Nonvested at January 1, 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nonvested at December 31, 2019 . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted
Average
Grant-Date
Fair Value
$ 19.08
24.60
13.65
26.29
24.61
Weighted
Average
Grant-Date
Fair Value
Shares
(in thousands)
504 $ 20.66
22.64
256
16.32
(313)
25.33
(20)
24.80
427
Shares
(in thousands)
1,923
709
(974)(1)(2)
(18)
1,640
(1) As of December 31, 2019, a total of 389,095 restricted stock units were vested but not yet issued, of which 30,486
vested during 2019. These shares have not been reflected as vested shares in this table because, in accordance with
the restricted stock unit agreements, shares of common stock are not issued for vested restricted stock units until
termination of employment.
(2) A total of 412,246 performance share unit awards are reflected in the vested shares in this table, which represents the
target number of performance share unit awards for this grant and were included in the balance at December 31,
2018. During the year ended December 31, 2019, an additional 357,006 performance share unit awards with a grant
date fair value of $10.22 vested above the target in accordance the performance criteria of these awards.
As of December 31, 2019, there was $22 million of total unrecognized compensation cost related to nonvested
share compensation arrangements granted under the Stock Incentive Plan and the Prior Plan. That cost is expected to be
recognized over a weighted-average period of approximately 1.8 years. The value of share awards that vested during the
years ended December 31, 2019, 2018 and 2017 was $24 million, $24 million and $22 million, respectively.
80
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
25. OTHER COMPREHENSIVE (LOSS) INCOME
Other comprehensive loss consisted of the following (dollars in millions):
Beginning balance, January 1, 2019 . . . . . . . . . . . . . . . . . $
Foreign
currency
translation
adjustment(a)
(371)
Pension and
Other
other
postretirement
benefits
adjustments(b)
(994)
$
comprehensive
income of
unconsolidated
affiliates
Other, net
Total
interests
attributable to
noncontrolling
attributable to
Huntsman
Corporation
Amounts
Amounts
$
8
$
5
$
(1,352)
$
36
$
(1,316)
Other comprehensive (loss) income before
reclassifications, gross . . . . . . . . . . . . . . . . . . . . . .
Tax benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amounts reclassified from accumulated other
comprehensive loss, gross(c) . . . . . . . . . . . . . . . . . .
Tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net current-period other comprehensive (loss) income . . . . .
Acquisition of noncontrolling interest . . . . . . . . . . . . . . . .
Ending balance, December 31, 2019 . . . . . . . . . . . . . . . . . $
—
2
—
—
2
—
(369)
$
(112)
25
62
(12)
(37)
—
(1,031)
$
—
—
—
—
—
—
8
$
(1)
—
—
—
(1)
—
4
$
(113)
27
62
(12)
(36)
—
(1,388)
$
5
—
—
—
5
(15)
26
$
(108)
27
62
(12)
(31)
(15)
(1,362)
(a) Amounts are net of tax of $68 and $71 as of December 31, 2019 and January 1, 2019, respectively.
(b) Amounts are net of tax of $148 and $135 as of December 31, 2019 and January 1, 2019, respectively.
(c) See table below for details about these reclassifications.
Beginning balance, January 1, 2018 . . . . . . . . . . . . . . . . . . $
Cumulative effect of changes in fair value of equity investments . .
Revised beginning balance, January 1, 2018 . . . . . . . . . . . . .
Foreign
currency
translation
adjustment(a)
(249)
—
(249)
Pension and
other
postretirement
benefits
adjustments(b)
(1,189)
—
(1,189)
$
Other comprehensive (loss) income before
reclassifications, gross . . . . . . . . . . . . . . . . . . . . . . .
Tax expense (benefit) . . . . . . . . . . . . . . . . . . . . . . . . .
Amounts reclassified from accumulated other
comprehensive loss, gross(c) . . . . . . . . . . . . . . . . . . .
Tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net current-period other comprehensive (loss) income . . . . . .
Disposition of a portion of Venator . . . . . . . . . . . . . . . . . .
Deconsolidation of Venator . . . . . . . . . . . . . . . . . . . . . . .
Tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ending balance, December 31, 2018 . . . . . . . . . . . . . . . . . . $
(186)
(6)
—
—
(192)
—
70
—
(371)
$
(130)
27
77
(13)
(39)
—
285
(51)
(994)
Other
comprehensive
income of
unconsolidated
affiliates
Other, net
Total
interests
attributable to
noncontrolling
attributable to
Huntsman
Corporation
Amounts
Amounts
$
$
3
—
3
—
—
—
—
—
—
5
—
8
$
$
$
24
(10)
14
—
(3)
—
(6)
(9)
—
—
—
5
$
(1,411)
(10)
(1,421)
(316)
18
77
(19)
(240)
—
360
(51)
(1,352)
$
$
143
—
143
47
—
—
—
47
(5)
(149)
—
36
$
$
(1,268)
(10)
(1,278)
(269)
18
77
(19)
(193)
(5)
211
(51)
(1,316)
(a) Amounts are net of tax of $71 and $65 as of December 31, 2018 and January 1, 2018, respectively.
(b) Amounts are net of tax of $135 and $172 as of December 31, 2018 and January 1, 2018, respectively.
(c) See table below for details about these reclassifications.
Details about Accumulated Other
Comprehensive Loss Components(a):
Amortization of pension and other postretirement
benefits:
Prior service credit . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Settlement loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total reclassifications for the period . . . . . . . . . . . . . .
$
Amounts reclassified
from accumulated
other
comprehensive loss
Year ended December 31,
2018
2019
Affected line item in
where net income
2017
is presented
(11) $
1
72
62
(12)
50 $
(12) $
2
87
77
(13)
64 $
(15)
—
95
80
(14)
66
(b)
(b)(c)
Total before tax
Income tax expense
Net of tax
(a) Pension and other postretirement benefits amounts in parentheses indicate credits on our consolidated statements of
operations.
(b) These accumulated other comprehensive loss components are included in the computation of net periodic pension
costs. See “Note 19. Employee Benefit Plans.”
81
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
25. OTHER COMPREHENSIVE (LOSS) INCOME (Continued)
(c) Amounts contain approximately $7, $22 and $22 of prior service credit and actuarial loss related to discontinued
operations for the years ended December 31, 2019, 2018 and 2017, respectively.
Items of other comprehensive income (loss) of our Company and our consolidated affiliates have been recorded
net of tax, with the exception of the foreign currency translation adjustments related to subsidiaries with earnings
permanently reinvested. The tax effect is determined based upon the jurisdiction where the income or loss was
recognized and is net of valuation allowances.
26. RELATED PARTY TRANSACTIONS
Our consolidated financial statements include the following transactions with our affiliates not otherwise
disclosed (dollars in millions):
Sales to:
Unconsolidated affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 133 $ 153 $ 161
Inventory purchases from:
Unconsolidated affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
434
411
291
Year ended December 31,
2017
2018
2019
27. OPERATING SEGMENT INFORMATION
We derive our revenues, earnings and cash flows from the manufacture and sale of a wide variety of
differentiated and commodity chemical products. We have four operating segments, which are also our reportable
segments: Polyurethanes, Performance Products, Advanced Materials and Textile Effects. We have organized our
business and derived our operating segments around differences in product lines. Beginning in the third quarter of 2019,
we reported the results of our Chemical Intermediates Businesses as discontinued operations and the related assets and
liabilities as held for sale in our consolidated financial statements for all periods presented. See “Note 4. Discontinued
Operations and Business Dispositions—Sale of Chemical Intermediates Businesses.” In addition, in connection with the
Venator IPO in August 2017, we separated Venator and, beginning in the third quarter of 2017, we reported the results of
operations of Venator as discontinued operations in our consolidated financial statements. On December 3, 2018, we
further reduced our remaining investment in Venator by the sale of Venator ordinary shares which allowed us to
deconsolidate Venator and account for our remaining interest in Venator as an equity method investment using the fair
value option post consolidation. See “Note 4. Discontinued Operations and Business Dispositions—Separation and
Deconsolidation of Venator.”
The major products of each reportable operating segment are as follows:
Segment
Polyurethanes
Performance Products
Advanced Materials
Products
MDI, polyols, TPU and aniline
Specialty amines, ethyleneamines, maleic anhydride and technology licenses
Basic liquid and solid epoxy resins; specialty resin compounds; cross-linking, matting
and curing agents; epoxy, acrylic and polyurethane-based formulations
Textile Effects
Textile chemicals, dyes and digital inks
82
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
27. OPERATING SEGMENT INFORMATION (Continued)
Sales between segments are generally recognized at external market prices and are eliminated in consolidation.
We use adjusted EBITDA to measure the financial performance of our global business units and for reporting the results
of our operating segments. This measure includes all operating items relating to the businesses. The adjusted EBITDA of
operating segments excludes items that principally apply to our Company as a whole. The revenues and adjusted
EBITDA for each of our reportable operating segments are as follows (dollars in millions):
Year ended December 31,
2018
2017
2019
Revenues:
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,911 $ 4,282 $ 3,764
1,156
Performance Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,040
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
776
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
109
Corporate and eliminations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,797 $ 7,604 $ 6,845
1,158
1,044
763
(79)
1,301
1,116
824
81
Segment adjusted EBITDA(1):
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Performance Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate and other(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
548 $
168
201
84
(155)
846
809 $
197
225
101
(171)
1,161
776
155
219
83
(193)
1,040
Reconciliation of adjusted EBITDA to net income:
Interest expense—continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest expense—discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income tax benefit (expense)—continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income tax expense—discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization—continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization—discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . .
Net income attributable to noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other adjustments:
Business acquisition and integration expenses and purchase accounting inventory
adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Merger costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EBITDA from discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncontrolling interest of discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fair value adjustments to Venator investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Loss on early extinguishment of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Certain legal settlements and related (expenses) income . . . . . . . . . . . . . . . . . . . . . . .
(Loss) gain on sale of businesses/assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Certain nonrecurring information technology project implementation costs . . . . . . . .
Amortization of pension and postretirement actuarial losses . . . . . . . . . . . . . . . . . . . .
Plant incident remediation costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. Tax Reform Act impact on noncontrolling interest . . . . . . . . . . . . . . . . . . . . . . . .
Restructuring, impairment and plant closing and transition credits (costs) . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
(111)
—
38
(35)
(270)
(61)
36
(115)
(36)
(45)
(86)
(255)
(88)
313
(5)
—
265
—
(18)
(23)
(6)
(21)
(4)
(66)
(8)
—
41
598 $
(9)
(2)
171
(232)
(62)
(3)
(1)
—
—
(67)
—
—
6
650 $
(165)
(19)
(20)
(111)
(236)
(151)
105
(19)
(28)
511
(49)
—
(54)
11
9
—
(69)
(1)
6
(19)
741
83
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
27. OPERATING SEGMENT INFORMATION (Continued)
Depreciation and Amortization:
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Performance Products. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
120 $
81
36
16
17
270 $
108 $
78
37
16
16
255 $
92
78
33
14
19
236
Year ended December 31,
2018
2017
2019
Year ended December 31,
2018
2017
2019
Capital Expenditures:
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Performance Products. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
185 $
32
24
22
11
274 $
153 $
48
20
20
10
251 $
158
35
21
16
4
234
December 31,
2019
2018
Total Assets:
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Performance Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textile Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
3,437 $
1,125
774
511
1,265
7,112 $
3,129
1,161
796
571
1,187
6,844
December 31,
2019
2018
Goodwill:
Polyurethanes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Performance Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Advanced Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
177 $
16
83
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
276 $
173
16
86
275
(1) We use segment adjusted EBITDA as the measure of each segment’s profit or loss. We believe that segment
adjusted EBITDA more accurately reflects what management uses to make decisions about resources to be
allocated to the segments and assess their financial performance. Segment adjusted EBITDA is defined as net
income of Huntsman Corporation before interest, income tax, depreciation and amortization, net income
attributable to noncontrolling interests and certain Corporate and other items, as well as eliminating the
following adjustments: (a) business acquisition and integration expenses and purchase accounting inventory
adjustments; (b) merger costs; (c) EBITDA from discontinued operations; (d) noncontrolling interest of
discontinued operations; (e) fair value adjustments to Venator investment; (f) loss on early extinguishment of
debt; (g) certain legal settlements and related income (expenses); (h) gain on sale of businesses/assets;
(i) certain nonrecurring information technology project implementation costs; (j) amortization of pension and
postretirement actuarial losses; (k) plant incident remediation costs; (l) U.S. Tax Reform Act impact on
noncontrolling interest; and (m) restructuring, impairment, plant closing and transition credits (costs).
84
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
27. OPERATING SEGMENT INFORMATION (Continued)
(2) Corporate and other includes unallocated corporate overhead, unallocated foreign exchange gains and losses,
LIFO inventory valuation reserve adjustments, nonoperating income and expense, benzene sales and gains and
losses on the disposition of corporate assets.
Year ended December 31,
2018
2019
2017
Revenues by geographic area(1):
United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,025 $ 2,136 $ 1,828
1,122
China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Germany . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
507
336
India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,052
Other nations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,797 $ 7,604 $ 6,845
1,076
541
319
2,836
1,260
537
352
3,319
December 31,
2019
2018
Long-lived assets(2):
United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
The Netherlands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Saudi Arabia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Germany . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Switzerland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Singapore . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other nations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
970 $
334
247
154
137
106
94
341
2,383 $
944
331
247
161
143
108
96
323
2,353
(1) Geographic information for revenues is based upon countries into which product is sold.
(2) Long-lived assets consist of property, plant and equipment, net.
85
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
28. SELECTED UNAUDITED QUARTERLY FINANCIAL DATA
A summary of selected unaudited quarterly financial data for the years ended December 31, 2019 and 2018 is as
follows (dollars in millions, except per share amounts):
March 31,
June 30, September 30, December 31,
Three months ended
2019
2019
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,669 $ 1,784 $
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Restructuring, impairment and plant closing costs (credits) . . . . . . .
Income (loss) from continuing operations . . . . . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income attributable to noncontrolling interests . . . . . . . . . . . . . .
Net income attributable to Huntsman Corporation . . . . . . . . . . . . . . .
Basic income per share(4):
373
—
83
118
8
110
359
1
108
131
12
119
2019
1,687 $
340
(43)
(27)
41
11
30
2019
1,657
310
1
265
308
5
303
Income (loss) from continuing operations attributable to
Huntsman Corporation common stockholders . . . . . . . . . . . . . .
0.41
0.33
(0.17)
Net income attributable to Huntsman Corporation common
stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.51
0.48
0.13
Diluted income per share(4):
Income (loss) from continuing operations attributable to
Huntsman Corporation common stockholders . . . . . . . . . . . . . .
0.41
0.32
(0.17)
Net income attributable to Huntsman Corporation common
stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.51
0.47
0.13
1.16
1.35
1.15
1.34
Three months ended
March 31,
June 30, September 30, December 31,
2018
2018
2018(1)
2018(2)
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,838 $ 1,977 $
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Restructuring, impairment and plant closing costs (credits) . . . . . . .
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income attributable to noncontrolling interests(3) . . . . . . . . . . . .
Net income (loss) attributable to Huntsman Corporation . . . . . . . . . .
Basic income per share(4):
479
1
242
623
209
414
466
2
189
350
76
274
1,968 $
467
5
197
(8)
3
(11)
1,821
352
(15)
61
(315)
25
(340)
Income from continuing operations attributable to Huntsman
Corporation common stockholders . . . . . . . . . . . . . . . . . . . . . . .
0.70
0.93
0.72
0.20
Net income (loss) attributable to Huntsman Corporation
common stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1.14
1.73
(0.05)
(1.45)
Diluted income per share(4):
Income from continuing operations attributable to Huntsman
Corporation common stockholders . . . . . . . . . . . . . . . . . . . . . . .
0.68
0.91
0.72
0.19
Net income (loss) attributable to Huntsman Corporation
common stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1.11
1.71
(0.05)
(1.43)
(1) During the third quarter of 2018, we recognized a net after tax valuation allowance of $270 million to adjust the
carrying amount of the assets and liabilities held for sale and the amount of accumulated comprehensive income
recorded in equity related to Venator to the lower of cost or estimated fair value, less cost to sell. This loss was
recorded in discontinued operations on our consolidated statements of operations. For more information see “Note 4.
Discontinued Operations and Dispositions – Separation and Deconsolidation of Venator.”
86
HUNTSMAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
28. SELECTED UNAUDITED QUARTERLY FINANCIAL DATA (Continued)
(2) In connection with the deconsolidation of Venator, we recorded a pretax loss of $427 million during the fourth
quarter of 2018 to record our remaining ownership interest in Venator at fair value. This loss was recorded in
discontinued operations on our consolidated statements of operations. We elected the fair value option to account for
our equity method investment in Venator post deconsolidation. Accordingly, at December 31, 2018, we recorded a
pretax loss of $57 million to record our equity method investment in Venator at fair value. This loss was recorded in
“Fair value adjustments to Venator investment” on our consolidated statements of operations. Furthermore, in
connection with the December 3, 2018 sale of Venator shares to Bank of America N.A., we recorded a forward
swap. During December 2018, we recorded a loss of $5 million in “Fair value adjustments to Venator investment”
on our consolidated statements of operations to record the forward swap at fair value. For more information, see
“Note 4. Discontinued Operations and Dispositions – Separation and Deconsolidation of Venator.”
(3) In connection with the Venator IPO in August 2017, we separated the P&A Business and, beginning in the third
quarter of 2017, we reported the results of operations of Venator as discontinued operations on our consolidated
financial statements. On December 3, 2018, we further reduced our investment in Venator by the sale of Venator
ordinary shares which allowed us to deconsolidate Venator beginning in December 2018. See “Note 4. Discontinued
Operations and Business Dispositions—Separation of Venator.”
(4) Basic and diluted income per share are computed independently for each of the quarters presented based on the
weighted average number of common shares outstanding during that period. Therefore, the sum of quarterly basic
and diluted per share information may not equal annual basic and diluted earnings per share.
∗∗∗∗∗∗
87
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES
MARKET INFORMATION AND HOLDERS
Our common stock is listed on the New York Stock Exchange under the symbol “HUN.” As of January 31,
2020, there were approximately 68 stockholders of record and the closing price of our common stock on the New York
Stock Exchange was $20.56 per share.
DIVIDENDS
The payment of dividends is a business decision made by our Board of Directors from time to time based on our
earnings, financial position and prospects, and such other considerations as our Board of Directors considers relevant.
Accordingly, while management currently expects that the Company will continue to pay the quarterly cash dividend, its
dividend practice may change at any time. On February 7, 2018, the Board of Directors approved an increase to the
quarterly cash dividend to $0.1625 per share of common stock beginning with the March 30, 2018 quarterly dividend.
PURCHASES OF EQUITY SECURITIES BY THE COMPANY
The following table provides information with respect to shares of our common stock that we repurchased as
part of our share repurchase program and shares of restricted stock granted under our stock incentive plans that we
withheld upon vesting to satisfy our tax withholding obligations during the three months ended December 31, 2019.
Total number Average
price paid
of shares
Maximum number
Total number of
shares purchased
as part of publicly
announced plans
(or approximate
dollar value) of
shares that may yet
be purchased under
October . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
November . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
December . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
purchased per share(1) or programs(2) the plans or programs(2)
528,000,000
523,000,000
516,000,000
— $
— $
183,495
321,448
504,943 $
—
22.79
23.35
23.14
183,059
320,501
503,560
(1) Represents net purchase price per share, exclusive of any fees or commissions.
(2) On February 7, 2018 and on May 3, 2018, our Board of Directors authorized our Company to repurchase up to an
additional $950 million in shares of our common stock in addition to the $50 million remaining under our
September 2015 share repurchase authorization. The share repurchase program will be supported by our free cash
flow generation. Repurchases may be made in the open market, including through accelerated share repurchase
programs, or in privately negotiated transactions, and repurchases may be commenced or suspended from time to
time without prior notice. Shares of common stock acquired through the repurchase program are held in treasury at
cost.
88
STOCK PERFORMANCE GRAPH
Comparison of Cumulative Five Year Total Return
$200
$150
$100
$50
$0
12/31/14
12/31/15
12/31/16
12/31/17
12/31/18
12/31/19
Huntsman Corporation
S&P 500 Index
S&P 500 Chemicals
89
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91
Huntsman Corporation | 2019 Annual Report
Huntsman Corporation—Directors & Officers
BOARD OF DIRECTORS
NAME
PRINCIPAL OCCUPATION
Peter R. Huntsman
Chairman of the Board, President and Chief Executive Officer
Nolan D. Archibald
Former Executive Chairman of Stanley Black & Decker
Mary C. Beckerle
Chief Executive Officer of Huntsman Cancer Institute at the University of Utah
M. Anthony Burns
Chairman Emeritus of Ryder System, Inc.
Daniele Ferrari
Chief Executive Officer of Versalis S.p.A.
Sir Robert J. Margetts
Former Deputy Chairman, OJSC Uralkali
Wayne A. Reaud
Trial Lawyer
Jan E. Tighe
Retired Vice Admiral of the U.S. Navy
CORPORATE OFFICERS
NAME
TITLE
Peter R. Huntsman
Chairman of the Board, President and Chief Executive Officer
Sean Douglas
Executive Vice President and Chief Financial Officer
David M. Stryker
Executive Vice President, General Counsel and Secretary
Anthony P. Hankins
Division President, Polyurethanes and Chief Executive Officer, Asia-Pacific
Rohit Aggarwal
Division President, Textile Effects
Monte G. Edlund
Division President, Performance Products
Scott J. Wright
Division President, Advanced Materials
Ronald W. Gerrard
Senior Vice President, Environmental, Health & Safety and Manufacturing Excellence
and Corporate Sustainability Officer
R. Wade Rogers
Senior Vice President, Global Human Resources
Randy W. Wright
Vice President and Controller
Twila Day
Vice President and Chief Information Officer
Kevin C. Hardman
Vice President, Tax
Philip M. Lister
Vice President, Corporate Development
Ivan M. Marcuse
Vice President, Investor Relations
Claire Mei
Vice President and Treasurer
Pierre Poukens
Vice President, Internal Audit
Nooshin E. Vaughn
Vice President, Financial Planning and Analysis
92
Huntsman Corporation | 2019 Annual Report
Huntsman Corporation—Corporate Information
GLOBAL HEADQUARTERS
10003 Woodloch Forest Drive
The Woodlands, Texas 77380 USA
Tel.: +1-281-719-6000
WEBSITE
www.huntsman.com
INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
Deloitte & Touche LLP
STOCKHOLDER INQUIRIES
Inquiries from stockholders and
other interested parties regarding
our company are always welcome.
Please direct your requests to:
INVESTOR RELATIONS
10003 Woodloch Forest Drive
The Woodlands, Texas 77380 USA
Tel.: +1-281-719-4637
Email: ir@huntsman.com
STOCK TRANSFER AGENT
Computershare
Toll Free: 1-866-210-6997
International: +1-201-680-6578
www.computershare.com/investor
By Regular Mail:
P.O. Box 505000
Louisville, Kentucky 40233 USA
By Overnight Delivery:
462 South 4th Street
Suite 1600
Louisville, Kentucky 40202 USA
STOCK LISTING
Our common stock is listed on the New York
Stock Exchange under the symbol HUN.
ANNUAL MEETING
The 2020 annual meeting of stockholders will take
place on Wednesday, April 29, 2020 at 8:30 a.m.,
local time, at the following location:
The Woodlands® Resort & Conference Center
2301 North Millbend Drive
The Woodlands, Texas 77380 USA
Tel.: +1-281-367-1100
FORM 10-K AND OTHER REPORTS
Paper copies of Huntsman’s (1) Annual Report on
Form 10-K, (2) Quarterly Reports on Form 10-Q,
and (3) Proxy Statement may be obtained without
charge from:
Investor Relations
Huntsman Corporation
10003 Woodloch Forest Drive
The Woodlands, Texas 77380 USA
Tel: +1-281-719-4637
Copies of these reports may also be obtained
from the company’s Investor Relations website:
http://ir.huntsman.com/
FORWARD-LOOKING STATEMENTS
Statements in this report 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 circum-
stances 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, volatile global economic conditions, cyclical and volatile product markets, disruptions
in production at manufacturing facilities, reorganization or restructuring of Huntsman’s operations, the ability to implement cost
reductions and manufacturing optimization improvements in Huntsman businesses, and other financial, economic, competitive,
environmental, political, legal, regulatory and technological factors. The company assumes no obligation to provide revisions to any
forward-looking statements should circumstances change, except as otherwise required by applicable laws.
Annual Report Design by Curran & Connors, Inc.
www.curran-connors.com
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Global Headquarters
Huntsman Corporation
10003 Woodloch Forest Drive
The Woodlands, Texas 77380 USA
Telephone +1-281-719-6000
www.huntsman.com
Copyright © 2020 Huntsman Corporation or an affiliate thereof. All rights reserved.
The use of the symbol ® herein signifies the registration of the associated trademark in one or more, but not all, countries.
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