Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 18, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | Huntsman CORP | |
Entity Central Index Key | 1,307,954 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 240,008,103 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 | |
Current assets: | |||
Cash and cash equivalents | [1] | $ 440 | $ 385 |
Restricted cash | [1] | 11 | 11 |
Accounts and notes receivable (net of allowance for doubtful accounts of $24 and $23, respectively), ($369 and $328 pledged as collateral, respectively) | [1] | 1,223 | 1,168 |
Accounts receivable from affiliates | 24 | 15 | |
Inventories | [1] | 1,084 | 918 |
Prepaid expenses | 47 | 49 | |
Other current assets | [1] | 193 | 232 |
Current assets held for sale | 2,745 | 777 | |
Total current assets | 5,767 | 3,555 | |
Property, plant and equipment, net | [1] | 3,035 | 3,034 |
Investment in unconsolidated affiliates | 255 | 248 | |
Intangible assets, net | [1] | 56 | 43 |
Goodwill | 139 | 121 | |
Deferred income taxes | 268 | 253 | |
Other noncurrent assets | [1] | 463 | 472 |
Noncurrent assets held for sale | 1,463 | ||
Total assets | 9,983 | 9,189 | |
Current liabilities: | |||
Accounts payable | [1] | 871 | 774 |
Accounts payable to affiliates | 20 | 16 | |
Accrued liabilities | [1] | 537 | 471 |
Current portion of debt | [1] | 29 | 50 |
Current liabilities held for sale | 1,633 | 467 | |
Total current liabilities | 3,090 | 1,778 | |
Long-term debt | [1] | 2,845 | 4,122 |
Notes payable to affiliates | 1 | ||
Deferred income taxes | 426 | 371 | |
Other noncurrent liabilities | [1] | 1,031 | 1,057 |
Noncurrent liabilities held for sale | 393 | ||
Total liabilities | 7,392 | 7,722 | |
Commitments and contingencies (Notes 13 and 14) | |||
Huntsman Corporation stockholders' equity or Huntsman International LLC members' equity: | |||
Common stock $0.01 par value, 1,200,000,000 shares authorized, 252,529,511 and 250,802,175 shares issued and 238,609,819 and 236,370,347 shares outstanding, respectively | 3 | 3 | |
Additional paid-in capital | 3,683 | 3,447 | |
Treasury stock, 12,607,223 shares | (150) | (150) | |
Unearned stock-based compensation | (19) | (17) | |
Accumulated deficit | (48) | (325) | |
Accumulated other comprehensive loss | (1,358) | (1,671) | |
Total Huntsman Corporation stockholders' equity | 2,111 | 1,287 | |
Noncontrolling interests in subsidiaries | 480 | 180 | |
Total equity | 2,591 | 1,467 | |
Total liabilities and equity | 9,983 | 9,189 | |
Huntsman International | |||
Current assets: | |||
Cash and cash equivalents | [1] | 438 | 384 |
Restricted cash | [1] | 11 | 11 |
Accounts and notes receivable (net of allowance for doubtful accounts of $24 and $23, respectively), ($369 and $328 pledged as collateral, respectively) | [1] | 1,222 | 1,168 |
Accounts receivable from affiliates | 353 | 329 | |
Inventories | [1] | 1,084 | 918 |
Prepaid expenses | 46 | 49 | |
Other current assets | [1] | 193 | 227 |
Current assets held for sale | 2,745 | 777 | |
Total current assets | 6,092 | 3,863 | |
Property, plant and equipment, net | [1] | 3,031 | 3,012 |
Investment in unconsolidated affiliates | 255 | 248 | |
Intangible assets, net | [1] | 57 | 43 |
Goodwill | 139 | 121 | |
Deferred income taxes | 268 | 253 | |
Other noncurrent assets | [1] | 464 | 472 |
Noncurrent assets held for sale | 1,463 | ||
Total assets | 10,306 | 9,475 | |
Current liabilities: | |||
Accounts payable | [1] | 871 | 773 |
Accounts payable to affiliates | 67 | 51 | |
Accrued liabilities | [1] | 538 | 468 |
Notes payable to affiliates | 100 | 100 | |
Current portion of debt | [1] | 29 | 50 |
Current liabilities held for sale | 1,633 | 467 | |
Total current liabilities | 3,238 | 1,909 | |
Long-term debt | [1] | 2,845 | 4,122 |
Notes payable to affiliates | 717 | 697 | |
Deferred income taxes | 421 | 367 | |
Other noncurrent liabilities | [1] | 1,030 | 1,051 |
Noncurrent liabilities held for sale | 393 | ||
Total liabilities | 8,251 | 8,539 | |
Commitments and contingencies (Notes 13 and 14) | |||
Huntsman Corporation stockholders' equity or Huntsman International LLC members' equity: | |||
Members' equity, 2,728 units issued and outstanding | 3,412 | 3,226 | |
Accumulated deficit | (483) | (779) | |
Accumulated other comprehensive loss | (1,354) | (1,691) | |
Total Huntsman International LLC members' equity | 1,575 | 756 | |
Noncontrolling interests in subsidiaries | 480 | 180 | |
Total equity | 2,055 | 936 | |
Total liabilities and equity | $ 10,306 | $ 9,475 | |
[1] | At September 30, 2017 and December 31, 2016, respectively, $35 and $20 of cash and cash equivalents, $11 and $10 of restricted cash, $29 and $21 of accounts and notes receivable (net), $42 and $45 of inventories, $6 and $5 of other current assets, $272 and $279 of property, plant and equipment (net), $10 each of intangible assets (net), $39 and $37 of other noncurrent assets, $81 and $89 of accounts payable, $29 and $30 of accrued liabilities, $20 and $12 of current portion of debt, $94 and $114 of longterm debt, and $80 and $76 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See “Note 5. Variable Interest Entities.” |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 | |
Accounts and notes receivable, allowance for doubtful accounts (in dollars) | $ 24 | $ 23 | |
Accounts and notes receivable, pledged as collateral (in dollars) | $ 369 | $ 328 | |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Common stock, shares authorized | 1,200,000,000 | 1,200,000,000 | |
Common stock, shares issued | 252,529,511 | 250,802,175 | |
Common stock, shares outstanding | 238,609,819 | 236,370,347 | |
Treasury stock, shares | 12,607,223 | 12,607,223 | |
Variable Interest Entity | |||
Cash and cash equivalents from continuing operations at beginning of period | [1] | $ 440 | $ 385 |
Restricted cash | [1] | 11 | 11 |
Accounts and notes receivable (net) | [1] | 1,223 | 1,168 |
Inventories | [1] | 1,084 | 918 |
Other current assets | [1] | 193 | 232 |
Property, plant and equipment (net) | [1] | 3,035 | 3,034 |
Intangible assets (net) | [1] | 56 | 43 |
Other noncurrent assets | [1] | 463 | 472 |
Accounts payable | [1] | 871 | 774 |
Accrued liabilities | [1] | 537 | 471 |
Current portion of debt | [1] | 29 | 50 |
Long-term debt | [1] | 2,845 | 4,122 |
Other noncurrent liabilities | [1] | 1,031 | 1,057 |
Consolidated VIE's | |||
Variable Interest Entity | |||
Cash and cash equivalents from continuing operations at beginning of period | 35 | 20 | |
Restricted cash | 11 | 10 | |
Accounts and notes receivable (net) | 29 | 21 | |
Inventories | 42 | 45 | |
Other current assets | 6 | 5 | |
Property, plant and equipment (net) | 272 | 279 | |
Intangible assets (net) | 10 | 10 | |
Other noncurrent assets | 39 | 37 | |
Accounts payable | 81 | 89 | |
Accrued liabilities | 29 | 30 | |
Current portion of debt | 20 | 12 | |
Long-term debt | 94 | 114 | |
Other noncurrent liabilities | 80 | 76 | |
Huntsman International | |||
Accounts and notes receivable, allowance for doubtful accounts (in dollars) | 24 | 23 | |
Accounts and notes receivable, pledged as collateral (in dollars) | $ 369 | $ 328 | |
Members' equity, units issued (in units) | 2,728 | 2,728 | |
Members' equity, units outstanding (in units) | 2,728 | 2,728 | |
Variable Interest Entity | |||
Cash and cash equivalents from continuing operations at beginning of period | [1] | $ 438 | $ 384 |
Restricted cash | [1] | 11 | 11 |
Accounts and notes receivable (net) | [1] | 1,222 | 1,168 |
Inventories | [1] | 1,084 | 918 |
Other current assets | [1] | 193 | 227 |
Property, plant and equipment (net) | [1] | 3,031 | 3,012 |
Intangible assets (net) | [1] | 57 | 43 |
Other noncurrent assets | [1] | 464 | 472 |
Accounts payable | [1] | 871 | 773 |
Accrued liabilities | [1] | 538 | 468 |
Current portion of debt | [1] | 29 | 50 |
Long-term debt | [1] | 2,845 | 4,122 |
Other noncurrent liabilities | [1] | 1,030 | 1,051 |
Huntsman International | Consolidated VIE's | |||
Variable Interest Entity | |||
Cash and cash equivalents from continuing operations at beginning of period | 35 | 20 | |
Restricted cash | 11 | 10 | |
Accounts and notes receivable (net) | 29 | 21 | |
Inventories | 42 | 45 | |
Other current assets | 6 | 5 | |
Property, plant and equipment (net) | 272 | 279 | |
Intangible assets (net) | 10 | 10 | |
Other noncurrent assets | 39 | 37 | |
Accounts payable | 81 | 89 | |
Accrued liabilities | 29 | 30 | |
Current portion of debt | 20 | 12 | |
Long-term debt | 94 | 114 | |
Other noncurrent liabilities | $ 80 | $ 76 | |
[1] | At September 30, 2017 and December 31, 2016, respectively, $35 and $20 of cash and cash equivalents, $11 and $10 of restricted cash, $29 and $21 of accounts and notes receivable (net), $42 and $45 of inventories, $6 and $5 of other current assets, $272 and $279 of property, plant and equipment (net), $10 each of intangible assets (net), $39 and $37 of other noncurrent assets, $81 and $89 of accounts payable, $29 and $30 of accrued liabilities, $20 and $12 of current portion of debt, $94 and $114 of longterm debt, and $80 and $76 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See “Note 5. Variable Interest Entities.” |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Revenues: | ||||
Trade sales, services and fees, net | $ 2,137 | $ 1,802 | $ 6,048 | $ 5,519 |
Related party sales | 32 | 29 | 107 | 95 |
Total revenues | 2,169 | 1,831 | 6,155 | 5,614 |
Cost of goods sold | 1,695 | 1,475 | 4,852 | 4,444 |
Gross profit | 474 | 356 | 1,303 | 1,170 |
Operating expenses: | ||||
Selling, general and administrative | 198 | 185 | 583 | 564 |
Research and development | 35 | 34 | 103 | 103 |
Restructuring, impairment and plant closing costs | 1 | 38 | 13 | 56 |
Merger costs | 12 | 18 | ||
Other operating expense (income), net | 5 | (2) | (9) | (3) |
Total expenses | 251 | 255 | 708 | 720 |
Operating income | 223 | 101 | 595 | 450 |
Interest expense | (39) | (52) | (134) | (153) |
Equity in income of investment in unconsolidated affiliates | 1 | 1 | 4 | 4 |
Loss on early extinguishment of debt | (35) | (1) | (36) | (3) |
Other income (loss), net | 1 | (3) | 2 | (1) |
Income from continuing operations before income taxes | 151 | 46 | 431 | 297 |
Income tax expense | (35) | (6) | (78) | (65) |
Income from continuing operations | 116 | 40 | 353 | 232 |
Income (loss) from discontinued operations, net of tax | 63 | 24 | 101 | (12) |
Net income | 179 | 64 | 454 | 220 |
Net income attributable to noncontrolling interests | (32) | (9) | (64) | (22) |
Net income attributable to Huntsman Corporation or Huntsman International LLC | $ 147 | $ 55 | $ 390 | $ 198 |
Basic income (loss) per share: | ||||
Income from continuing operations attributable to Huntsman Corporation common stockholders (in dollars per share) | $ 0.36 | $ 0.13 | $ 1.22 | $ 0.89 |
Income (loss) from discontinued operations attributable to Huntsman Corporation common stockholders, net of tax | 0.26 | 0.10 | 0.42 | (0.05) |
Net income attributable to Huntsman Corporation common stockholders (in dollars per share) | $ 0.62 | $ 0.23 | $ 1.64 | $ 0.84 |
Weighted average shares (in shares) | 238.5 | 236.3 | 238 | 236.2 |
Diluted income (loss) per share: | ||||
Income from continuing operations attributable to Huntsman Corporation common stockholders (in dollars per share) | $ 0.34 | $ 0.13 | $ 1.19 | $ 0.88 |
Income (loss) from discontinued operations attributable to Huntsman Corporation common stockholders, net of tax | 0.26 | 0.10 | 0.41 | (0.05) |
Net income attributable to Huntsman Corporation common stockholders (in dollars per share) | $ 0.60 | $ 0.23 | $ 1.60 | $ 0.83 |
Weighted average shares (in shares) | 244 | 240.1 | 243.5 | 239.1 |
Amounts attributable to Huntsman Corporation common stockholders: | ||||
Income from continuing operations | $ 84 | $ 31 | $ 289 | $ 210 |
Income (loss) from discontinued operations, net of tax | $ 63 | $ 24 | $ 101 | $ (12) |
Dividends per share (in dollars per share) | $ 0.125 | $ 0.125 | $ 0.375 | $ 0.375 |
Huntsman International | ||||
Revenues: | ||||
Trade sales, services and fees, net | $ 2,137 | $ 1,802 | $ 6,048 | $ 5,519 |
Related party sales | 32 | 29 | 107 | 95 |
Total revenues | 2,169 | 1,831 | 6,155 | 5,614 |
Cost of goods sold | 1,694 | 1,474 | 4,849 | 4,441 |
Gross profit | 475 | 357 | 1,306 | 1,173 |
Operating expenses: | ||||
Selling, general and administrative | 197 | 184 | 579 | 561 |
Research and development | 35 | 34 | 103 | 103 |
Restructuring, impairment and plant closing costs | 1 | 38 | 13 | 56 |
Merger costs | 12 | 18 | ||
Other operating expense (income), net | 5 | (2) | (9) | (3) |
Total expenses | 250 | 254 | 704 | 717 |
Operating income | 225 | 103 | 602 | 456 |
Interest expense | (44) | (55) | (146) | (162) |
Equity in income of investment in unconsolidated affiliates | 1 | 1 | 4 | 4 |
Loss on early extinguishment of debt | (35) | (1) | (36) | (3) |
Other income (loss), net | 2 | 5 | 5 | |
Income from continuing operations before income taxes | 149 | 48 | 429 | 300 |
Income tax expense | (34) | (7) | (77) | (65) |
Income from continuing operations | 115 | 41 | 352 | 235 |
Income (loss) from discontinued operations, net of tax | 62 | 22 | 98 | (17) |
Net income | 177 | 63 | 450 | 218 |
Net income attributable to noncontrolling interests | (32) | (9) | (64) | (22) |
Net income attributable to Huntsman Corporation or Huntsman International LLC | $ 145 | $ 54 | $ 386 | $ 196 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Net income | $ 179 | $ 64 | $ 454 | $ 220 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translations adjustments | 66 | 15 | 201 | (11) |
Pension and other postretirement benefits adjustments | 18 | 11 | 55 | 35 |
Other, net | (1) | 4 | (3) | (2) |
Other comprehensive income (loss), net of tax | 83 | 30 | 253 | 22 |
Comprehensive income | 262 | 94 | 707 | 242 |
Comprehensive income attributable to noncontrolling interests | (37) | (9) | (76) | (22) |
Comprehensive income attributable to Huntsman Corporation or Huntsman International LLC | 225 | 85 | 631 | 220 |
Huntsman International | ||||
Net income | 177 | 63 | 450 | 218 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translations adjustments | 65 | 15 | 199 | (11) |
Pension and other postretirement benefits adjustments | 39 | 14 | 80 | 40 |
Other, net | 3 | (2) | (2) | |
Other comprehensive income (loss), net of tax | 104 | 32 | 277 | 27 |
Comprehensive income | 281 | 95 | 727 | 245 |
Comprehensive income attributable to noncontrolling interests | (37) | (9) | (76) | (22) |
Comprehensive income attributable to Huntsman Corporation or Huntsman International LLC | $ 244 | $ 86 | $ 651 | $ 223 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Millions | Huntsman InternationalMembers' equity | Huntsman InternationalAccumulated deficit | Huntsman InternationalAccumulated other comprehensive loss | Huntsman InternationalNoncontrolling interests in subsidiaries | Huntsman International | Common stock | Additional paid-in capital | Treasury stock | Unearned stock-based compensation | Accumulated deficit | Accumulated other comprehensive loss | Noncontrolling interests in subsidiaries | Total |
Balance at the beginning of the period at Dec. 31, 2015 | $ 3 | $ 3,407 | $ (135) | $ (17) | $ (528) | $ (1,288) | $ 187 | $ 1,629 | |||||
Balance (in shares) at Dec. 31, 2015 | 237,080,026 | ||||||||||||
Balance at the beginning of the period at Dec. 31, 2015 | $ 3,196 | $ (983) | $ (1,316) | $ 187 | $ 1,084 | ||||||||
Balance (in units) at Dec. 31, 2015 | 2,728 | ||||||||||||
Increase (Decrease) in Stockholders' Equity and Members' Equity | |||||||||||||
Net income | 196 | 22 | 218 | 198 | 22 | 220 | |||||||
Dividends paid to parent | (90) | (90) | |||||||||||
Other comprehensive income | 27 | 27 | 22 | 22 | |||||||||
Contribution from parent | $ 24 | 24 | |||||||||||
Issuance of nonvested stock awards | 17 | (17) | |||||||||||
Vesting of stock awards | 2 | 2 | |||||||||||
Vesting of stock awards (in shares) | 895,660 | ||||||||||||
Recognition of stock-based compensation | 7 | 13 | 20 | ||||||||||
Repurchase and cancellation of stock awards | (3) | (3) | |||||||||||
Repurchase and cancellation of stock awards (in shares) | (249,155) | ||||||||||||
Dividends paid to noncontrolling interests | (26) | (26) | (26) | (26) | |||||||||
Stock options exercised (in shares) | 35,170 | ||||||||||||
Treasury stock repurchased | 15 | (15) | |||||||||||
Treasury stock repurchased (in shares) | (1,444,769) | ||||||||||||
Excess tax shortfall related to stock-based compensation | (3) | (3) | (3) | (3) | |||||||||
Dividends declared on common stock | (90) | (90) | |||||||||||
Balance at the end of the period at Sep. 30, 2016 | $ 3 | 3,445 | (150) | (21) | (423) | (1,266) | 183 | 1,771 | |||||
Balance (in shares) at Sep. 30, 2016 | 236,316,932 | ||||||||||||
Balance at the end of the period at Sep. 30, 2016 | $ 3,217 | (877) | (1,289) | 183 | 1,234 | ||||||||
Balance (in units) at Sep. 30, 2016 | 2,728 | ||||||||||||
Balance at the beginning of the period at Dec. 31, 2016 | $ 3 | 3,447 | (150) | (17) | (325) | (1,671) | 180 | $ 1,467 | |||||
Balance (in shares) at Dec. 31, 2016 | 236,370,347 | 236,370,347 | |||||||||||
Balance at the beginning of the period at Dec. 31, 2016 | $ 3,226 | (779) | (1,691) | 180 | $ 936 | ||||||||
Balance (in units) at Dec. 31, 2016 | 2,728 | 2,728 | |||||||||||
Increase (Decrease) in Stockholders' Equity and Members' Equity | |||||||||||||
Net income | 386 | 64 | $ 450 | 390 | 64 | $ 454 | |||||||
Dividends paid to parent | (90) | (90) | |||||||||||
Other comprehensive income | 337 | (60) | 277 | 313 | (60) | 253 | |||||||
Contribution from parent | $ 26 | 26 | |||||||||||
Issuance of nonvested stock awards | 17 | (17) | |||||||||||
Vesting of stock awards | 8 | 8 | |||||||||||
Vesting of stock awards (in shares) | 1,200,218 | ||||||||||||
Recognition of stock-based compensation | 7 | 13 | 20 | ||||||||||
Repurchase and cancellation of stock awards | (8) | (8) | |||||||||||
Repurchase and cancellation of stock awards (in shares) | (348,887) | ||||||||||||
Contribution from noncontrolling interests | 4 | 4 | 4 | 4 | |||||||||
Dividends paid to noncontrolling interests | (26) | (26) | (26) | (26) | |||||||||
Disposition of a portion of P and A Business | 209 | 209 | 209 | 209 | |||||||||
Separation costs of P and A Business | (40) | (40) | (40) | (40) | |||||||||
Conversion of restricted awards to P and A Business awards | (2) | 2 | |||||||||||
Minority interest on disposal of P and A Business | 318 | 318 | 318 | 318 | |||||||||
Pushdown of purchase accounting recorded at parent | (9) | (9) | |||||||||||
Stock options exercised | 37 | (15) | 22 | ||||||||||
Stock options exercised (in shares) | 1,388,141 | ||||||||||||
Dividends declared on common stock | (90) | (90) | |||||||||||
Balance at the end of the period at Sep. 30, 2017 | $ 3 | $ 3,683 | $ (150) | $ (19) | $ (48) | $ (1,358) | $ 480 | $ 2,591 | |||||
Balance (in shares) at Sep. 30, 2017 | 238,609,819 | 238,609,819 | |||||||||||
Balance at the end of the period at Sep. 30, 2017 | $ 3,412 | $ (483) | $ (1,354) | $ 480 | $ 2,055 | ||||||||
Balance (in units) at Sep. 30, 2017 | 2,728 | 2,728 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | ||
Operating Activities: | |||
Net income | $ 454 | $ 220 | |
Less: (Income) loss from discontinued operations | (101) | 12 | |
Income from continuing operations | 353 | 232 | |
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 | (4) | (4) | |
Depreciation and amortization | 235 | 238 | |
(Gain) loss on disposal of businesses/assets, net | (5) | 1 | |
Loss on early extinguishment of debt | 36 | 3 | |
Noncash interest expense | 7 | 12 | |
Noncash restructuring and impairment charges | 2 | ||
Deferred income taxes | 24 | 90 | |
Noncash gain on foreign currency transactions | (4) | ||
Stock-based compensation | 25 | 23 | |
Other, net | 3 | (3) | |
Changes in operating assets and liabilities | |||
Accounts and notes receivable | (148) | (3) | |
Inventories | (118) | 133 | |
Prepaid expenses | 2 | (6) | |
Other current assets | 31 | (14) | |
Other noncurrent assets | (22) | (13) | |
Accounts payable | 95 | (11) | |
Accrued liabilities | 46 | 49 | |
Other noncurrent liabilities | (18) | 7 | |
Net cash provided by operating activities from continuing operations | 538 | 736 | |
Net cash provided by operating activities from discontinued operations | 205 | 112 | |
Net cash provided by operating activities | 743 | 848 | |
Investing Activities: | |||
Capital expenditures | (159) | (214) | |
Investment in unconsolidated affiliates | (2) | ||
Acquisition of business, net of cash acquired | (14) | ||
Proceeds from sale of businesses/assets | 21 | ||
Cash received from termination of cross-currency interest rate contracts | 7 | ||
Change in restricted cash | 1 | ||
Other, net | 2 | ||
Net cash used in investing activities from continuing operations | (145) | (213) | |
Net cash used in investing activities from discontinued operations | (49) | (57) | |
Net cash provided by (used in) investing activities | (194) | (270) | |
Financing Activities: | |||
Net repayments under revolving loan facilities | (36) | ||
Net repayments on overdraft facilities | (1) | ||
Repayments of short-term debt | (10) | (41) | |
Borrowings on short-term debt | 6 | 8 | |
Repayments of long-term debt | (1,439) | (795) | |
Proceeds from long-term debt of P and A Business | 750 | ||
Proceeds from issuance of long-term debt | 24 | 552 | |
Repayments of notes payable | (20) | (25) | |
Borrowings on notes payable | 11 | 31 | |
Debt issuance costs paid | (21) | (8) | |
Dividends paid to noncontrolling interests | (26) | (26) | |
Contribution from noncontrolling interests | 4 | ||
Dividends paid to common stockholders | (90) | (90) | |
Repurchase and cancellation of stock awards | (8) | (3) | |
Proceeds from issuance of common stock | 22 | ||
Proceeds from the IPO of P and A Business | 522 | ||
Cash paid for expenses of the IPO of P and A Business | (40) | ||
Other, net | 2 | 1 | |
Net cash used in financing activities | (349) | (397) | |
Effect of exchange rate changes on cash | 12 | 1 | |
Increase in cash and cash equivalents | 212 | 182 | |
Cash and cash equivalents from continuing operations at beginning of period | 385 | [1] | 236 |
Cash and cash equivalents from discontinued operations at beginning of period | 29 | 21 | |
Cash and cash equivalents at end of period | 626 | 439 | |
Supplemental cash flow information: | |||
Cash paid for interest | 122 | 139 | |
Cash (received) paid for income taxes | (31) | 29 | |
Huntsman International | |||
Operating Activities: | |||
Net income | 450 | 218 | |
Less: (Income) loss from discontinued operations | (98) | 17 | |
Income from continuing operations | 352 | 235 | |
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 | (4) | (4) | |
Depreciation and amortization | 227 | 228 | |
(Gain) loss on disposal of businesses/assets, net | (5) | 1 | |
Loss on early extinguishment of debt | 36 | 3 | |
Noncash interest expense | 19 | 20 | |
Noncash restructuring and impairment charges | 2 | ||
Deferred income taxes | 24 | 90 | |
Noncash gain on foreign currency transactions | (4) | ||
Noncash compensation | 24 | 22 | |
Other, net | 3 | ||
Changes in operating assets and liabilities | |||
Accounts and notes receivable | (147) | (3) | |
Inventories | (118) | 133 | |
Prepaid expenses | 3 | (5) | |
Other current assets | 30 | (15) | |
Other noncurrent assets | (22) | (13) | |
Accounts payable | 84 | (20) | |
Accrued liabilities | 45 | 49 | |
Other noncurrent liabilities | (11) | 13 | |
Net cash provided by operating activities from continuing operations | 536 | 736 | |
Net cash provided by operating activities from discontinued operations | 202 | 107 | |
Net cash provided by operating activities | 738 | 843 | |
Investing Activities: | |||
Capital expenditures | (159) | (214) | |
Investment in unconsolidated affiliates | (2) | ||
Acquisition of business, net of cash acquired | (14) | ||
Proceeds from sale of businesses/assets | 21 | ||
Increase in receivable from affiliate | (3) | 3 | |
Cash received from termination of cross-currency interest rate contracts | 7 | ||
Change in restricted cash | 1 | ||
Other, net | 1 | 2 | |
Net cash used in investing activities from continuing operations | (147) | (210) | |
Net cash used in investing activities from discontinued operations | (49) | (57) | |
Net cash provided by (used in) investing activities | (196) | (267) | |
Financing Activities: | |||
Net repayments under revolving loan facilities | (36) | ||
Net repayments on overdraft facilities | (1) | ||
Repayments of short-term debt | (10) | (41) | |
Borrowings on short-term debt | 6 | 8 | |
Repayments of long-term debt | (1,439) | (795) | |
Proceeds from long-term debt of P and A Business | 750 | ||
Proceeds from issuance of long-term debt | 24 | 552 | |
Proceeds from issuance of notes payable from affiliate | 21 | ||
Repayments of notes payable to affiliate | (1) | ||
Repayments of notes payable | (20) | (25) | |
Borrowings on notes payable | 11 | 31 | |
Debt issuance costs paid | (21) | (8) | |
Dividends paid to noncontrolling interests | (26) | (26) | |
Contribution from noncontrolling interests | 4 | ||
Dividends paid to parent | (90) | (90) | |
Proceeds from the IPO of P and A Business | 522 | ||
Cash paid for expenses of the IPO of P and A Business | (40) | ||
Other, net | 1 | 1 | |
Net cash used in financing activities | (343) | (395) | |
Effect of exchange rate changes on cash | 12 | 1 | |
Increase in cash and cash equivalents | 211 | 182 | |
Cash and cash equivalents from continuing operations at beginning of period | 384 | [1] | 236 |
Cash and cash equivalents from discontinued operations at beginning of period | 29 | 21 | |
Cash and cash equivalents at end of period | 624 | 439 | |
Supplemental cash flow information: | |||
Cash paid for interest | 122 | 139 | |
Cash (received) paid for income taxes | $ (31) | $ 29 | |
[1] | At September 30, 2017 and December 31, 2016, respectively, $35 and $20 of cash and cash equivalents, $11 and $10 of restricted cash, $29 and $21 of accounts and notes receivable (net), $42 and $45 of inventories, $6 and $5 of other current assets, $272 and $279 of property, plant and equipment (net), $10 each of intangible assets (net), $39 and $37 of other noncurrent assets, $81 and $89 of accounts payable, $29 and $30 of accrued liabilities, $20 and $12 of current portion of debt, $94 and $114 of longterm debt, and $80 and $76 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See “Note 5. Variable Interest Entities.” |
CONDENSED CONSOLIDATED STATEME8
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Capital expenditures in accounts payable | $ 39 | $ 43 |
Cash paid for income taxes by P and A Business after IPO date | 5 | |
Huntsman International | ||
Capital expenditures in accounts payable | 39 | 43 |
Stock-based compensation | 24 | $ 22 |
Cash paid for income taxes by P and A Business after IPO date | $ 5 |
GENERAL
GENERAL | 9 Months Ended |
Sep. 30, 2017 | |
GENERAL | |
GENERAL | 1. GENERAL CERTAIN DEFINITIONS For convenience in this report, the terms “Company,” “Huntsman,” “our,” “us” or “we” may be used to refer to Huntsman Corporation and, unless the context otherwise requires, its subsidiaries and predecessors. In this report, “Huntsman International” refers to Huntsman International LLC (our wholly owned subsidiary). 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. INTERIM FINANCIAL STATEMENTS Our unaudited interim condensed consolidated financial statements and Huntsman International’s unaudited interim condensed consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP” or “U.S. GAAP”) and in management’s opinion reflect all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of results of operations, comprehensive income, financial position and cash flows for the periods presented. Results for interim periods are not necessarily indicative of those to be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes to consolidated financial statements included in the Annual Report on Form 10‑K for the year ended December 31, 2016 for our Company and Huntsman International. DESCRIPTION OF BUSINESS We are a global manufacturer of differentiated organic chemical products. 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, medical, packaging, coatings and construction, power generation, refining, synthetic fiber, textile chemicals and dyes industries. We are a leading global producer in many of our key product lines, including MDI, amines, surfactants, maleic anhydride, epoxy-based polymer formulations, textile chemicals and dyes. We operate in four segments: Polyurethanes, Performance Products, Advanced Materials and Textile Effects. In August 2017, we separated our Titanium Dioxide and Performance Additives business (the “P&A Business”) through an initial public offering (“IPO”) of ordinary shares of Venator Materials PLC (“Venator”), formerly our wholly-owned subsidiary (the “Separation”). Beginning in the third quarter of 2017, we reported the results of the former P&A Business as discontinued operations. See “Note 4. Discontinued Operations.” In a series of transactions beginning in 2006, we sold or shut down substantially all of our Australian styrenics operations and our North American polymers and base chemicals operations. We also report the results of these businesses as discontinued operations. COMPANY Our Company, a Delaware corporation, was formed in 2004 to hold the Huntsman businesses. Jon M. Huntsman founded the predecessor to our Company in 1970 as a small 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. HUNTSMAN CORPORATION AND HUNTSMAN INTERNATIONAL FINANCIAL STATEMENTS Except where otherwise indicated, these notes relate to the condensed consolidated financial statements for both our Company and Huntsman International. The differences between our financial statements and Huntsman International’s financial statements relate primarily to the following: · purchase accounting recorded at our Company for the 2003 step‑acquisition of Huntsman International Holdings LLC, the former parent company of Huntsman International that was merged into Huntsman International in 2005; · the different capital structures; and · a note payable from Huntsman International to us. PRINCIPLES OF CONSOLIDATION Our condensed 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. Intercompany accounts and transactions have been eliminated. 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 as held for sale and results of operations of the former P&A Business to discontinued operations. See “Note 4. Discontinued Operations.” In connection with the separation of the P&A Business, certain entities were removed from the debt guarantor structure. The unaudited condensed consolidated financial information included in “Note 19. Condensed Consolidating Financial Information of Huntsman International LLC” has been presented as if the new debt guarantor structure existed for all periods presented. RECENT DEVELOPMENTS Separation of the P&A Business 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. All of such ordinary shares were sold by Huntsman and Venator did not receive any proceeds from the offering. Venator’s ordinary shares began trading on The New York Stock Exchange under the symbol “VNTR” on August 3, 2017. Huntsman retains approximately 75% ownership in Venator. Beginning in the third quarter of 2017, we reported the results of operations of the P&A Business as discontinued operations. For more information, see “Note 4. Discontinued Operations.” In August 2017, we made early prepayments of $1,207 million on our senior credit facilities (“Senior Credit Facilities”), of which $106 million was paid on our extended term loan B facility due 2015 (“2015 Extended Term Loan B”) , $347 million was paid on our term loan B facility due 2021 (“ 2021 Term Loan B”) , and $754 million was paid on our term loan B facility due 2023 (“2023 Term Loan B”) . The funds used to pay down the debt included $732 million received from Venator ($750 million of debt raised by Venator net of $18 million of debt issuance costs), upon its payment of intercompany debt obligations owed to Huntsman and $475 million from proceeds of the Venator IPO. In connection with the $1,207 million prepayments of our term loans, we recognized a loss on early extinguishment of debt of $34 million. See “Note 7. Debt—Direct and Subsidiary Debt—Senior Credit Facilities.” Termination of Huntsman and Clariant Merger Agreement As previously disclosed, on May 21, 2017, Huntsman, Clariant and Merger Sub entered into the Merger Agreement which contemplated that Merger Sub would be merged with and into Huntsman, with Huntsman surviving the merger as a wholly-owned subsidiary of Clariant. On October 26, 2017, Huntsman, Clariant and Merger Sub entered into the Termination Agreement, dated as of October 26, 2017, pursuant to which the parties mutually terminated the Merger Agreement. No fees are currently payable under the terms of the Termination Agreement. Huntsman and Clariant also agreed to release each other from certain claims and liabilities arising out of or related to the Merger Agreement or the transactions contemplated therein or thereby. Pursuant to the Termination Agreement, each party agrees to bear its own costs, fees and expenses in connection with Merger Agreement and the transactions contemplated thereby, except for specified joint filing fees and related expenses as set forth in the Merger Agreement. During the three and nine months ended September 30, 2017 and 2016, we incurred merger-related costs of $12 million, $18 million, nil and nil, respectively. Debt Prepayment In addition to the debt prepayments made in connection with the separation of our former P&A Business and the Venator IPO described above, on October 25, 2017, we made an early prepayment of $100 million on our 2023 Term Loan B from existing cash. See “Note 7. Debt—Direct and Subsidiary Debt—Senior Credit Facilities.” USE OF ESTIMATES The preparation of financial statements in conformity with U.S. 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. |
RECENTLY ISSUED ACCOUNTING PRON
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS | 9 Months Ended |
Sep. 30, 2017 | |
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS | |
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS | 2. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS Accounting Pronouncements Adopted During 2017 In July 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory . The amendments in this ASU do not apply to inventory that is measured using last-in first-out (“LIFO”) or the retail inventory method, but rather does apply to all other inventory, which includes inventory that is measured using first-in first-out or average cost. An entity should measure in scope inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. The amendments in this ASU should be applied prospectively. We adopted the amendments in this ASU effective January 1, 2017, and the initial adoption of the amendment in this ASU did not have a significant impact on our condensed consolidated financial statements. In March 2016, the FASB issued ASU No. 2016‑09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share‑Based Payment Accounting . The amendments in this ASU simplify several aspects of the accounting for share‑based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. We adopted the amendments in this ASU effective January 1, 2017, and the initial adoption of the amendment in this ASU did not have a significant impact on our condensed consolidated financial statements. In January 2017, the FASB issued ASU No. 2017‑04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . The amendments in this ASU simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. Under the amendments in this ASU, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying value, which eliminates the current requirement to calculate a goodwill impairment charge by comparing the implied fair value of goodwill with its carrying amount. The amendments in this ASU are effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The amendments in this ASU should be applied on a prospective basis. We adopted the amendments in this ASU effective January 1, 2017 and the initial adoption of the amendments in this ASU did not have a significant impact on our condensed consolidated financial statements. Accounting Pronouncements Pending Adoption in Future Periods In May 2014, the FASB issued ASU No. 2014‑09, Revenue from Contracts with Customers (Topic 606) , outlining a single comprehensive model for entities to use in accounting for revenues arising from contracts with customers and supersedes most current revenue recognition guidance. In August 2015, the FASB issued ASU No. 2015‑14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date , deferring the effective date of ASU No. 2014‑09 for all entities by one year. Further, in March 2016, the FASB issued ASU No. 2016‑08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) , clarifying the implementation guidance on principal versus agent considerations, in April 2016, the FASB issued ASU No. 2016‑10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing , clarifying the implementation guidance on identifying performance obligations in a contract and determining whether an entity’s promise to grant a license provides a customer with either a right to use the entity’s intellectual property (which is satisfied at a point in time) or a right to access the entity’s intellectual property (which is satisfied over time), in May 2016, the FASB issued ASU No. 2016‑12, Revenue from Customers (Topic 606): Narrow‑Scope Improvements and Practical Expedients , providing clarifications and practical expedients for certain narrow aspects in Topic 606, and in December 2016, the FASB issued ASU 2016‑20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers . The amendments in these ASUs are effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. The amendments in ASU No. 2014‑09, ASU No. 2016‑08, ASU No. 2016‑10, ASU No. 2016‑12 and ASU No. 2016‑20 should be applied retrospectively, and early application is permitted. We are substantially complete with our analysis to identify areas that will be impacted by the adoption of the amendments in ASU No. 2014‑09, ASU No. 2016‑08, ASU No. 2016‑10, ASU No. 2016‑12 and ASU No. 2016‑20 on our condensed consolidated financial statements. At this time, other than additional required disclosures, we do not expect the adoption of the amendments in these ASUs to have a significant impact on our condensed consolidated financial statements. The standard will be adopted in our fiscal year 2018, and we have elected the modified retrospective approach as the transition method. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . The amendments in this ASU will 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 will 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. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early application of the amendments in this ASU is permitted for all entities. Reporting entities are required to recognize and measure leases under these amendments at the beginning of the earliest period presented using a modified retrospective approach. We are currently evaluating the impact of the adoption of the amendments in this ASU on our condensed consolidated financial statements and believe, based on our preliminary assessment, that we will record significant additional right-to-use assets and lease obligations. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments . The amendments in this ASU clarify and include specific guidance to address diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. The amendments in this ASU should be applied using a retrospective transition method to each period presented. We do not expect the adoption of the amendments in this ASU to have a significant impact on our condensed consolidated financial statements. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory . The amendments in this ASU require entities to recognize the current and deferred income taxes for an intra-entity transfer of an asset other than inventory when the transfer occurs, as opposed to deferring the recognition of the income tax consequences until the asset has been sold to an outside party. The amendments in this ASU are effective for annual reporting periods beginning after December 31, 2017, including interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities as of the beginning of an annual reporting period for which financial statements (interim or annual) have not been issued or made available for issuance. The amendments in this ASU should be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. We do not expect the adoption of the amendments in this ASU to have a significant impact on our condensed consolidated financial statements. In November 2016, the FASB issued ASU No. 2016‑18, Statement of Cash Flows (Topic 230): Restricted Cash . The amendments in this ASU require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning‑of‑period and end‑of‑period total amounts shown on the statement of cash flows. The amendments in this ASU are effective for fiscal years beginning after December 15, 2017, and interim period within those fiscal years. Early adoption is permitted, including adoption in an interim period. The amendments in this ASU should be applied using a retrospective transition method to each period presented. We do not expect the adoption of the amendments in this ASU to have a significant impact on our condensed consolidated financial statements. In January 2017, the FASB issued ASU No. 2017‑01, Business Combinations (Topic 805): Clarifying the Definition of a Business . The amendments in this ASU clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The amendments in this ASU are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early application is permitted. The amendments in this ASU should be applied prospectively on or after the effective date. No disclosures are required at transition. We do not expect the adoption of the amendments in this ASU to have a significant impact on our condensed consolidated financial statements. In March 2017, the FASB issued ASU No. 2017-07, Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost . The amendments in this ASU require that an employer report the service cost component of net periodic pension cost and net periodic postretirement benefit cost in the same line items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside of income from operations. The amendments in this ASU also allow only the service cost component to be eligible for capitalization when applicable (for example, as a cost of internally manufactured inventory or a self-constructed asset). The amendments in this ASU are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The amendments in this ASU should be applied retrospectively for the presentation of the service cost component and the other components of net periodic pension cost and net periodic postretirement benefit cost in the income statement and prospectively, on and after the effective date, for the capitalization of the service cost component of net periodic pension cost and net periodic postretirement benefit cost in assets. The amendments in this ASU will impact the presentation of our condensed consolidated financial statements. Our current presentation of service cost components is consistent with the amendments in this ASU. Upon adoption of the amendments in this ASU, we expect to present the other components within other nonoperating income, whereas we currently present these within cost of goods sold and selling, general and administrative expenses. 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. Early application is permitted in any interim period after the issuance of this ASU. 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 do not expect the adoption of the amendments in this ASU to have a significant impact on our condensed consolidated financial statements. |
INVENTORIES
INVENTORIES | 9 Months Ended |
Sep. 30, 2017 | |
INVENTORIES | |
INVENTORIES | 3. INVENTORIES Inventories are stated at the lower of cost or market, with cost determined using LIFO, first-in first-out, and average cost methods for different components of inventory. Inventories consisted of the following (dollars in millions): September 30, December 31, 2017 2016 Raw materials and supplies $ 218 $ 157 Work in progress 54 45 Finished goods 867 771 Total 1,139 973 LIFO reserves (55) (55) Net inventories $ 1,084 $ 918 For both September 30, 2017 and December 31, 2016, approximately 13% of inventories were recorded using the LIFO cost method. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 9 Months Ended |
Sep. 30, 2017 | |
DISCONTINUED OPERATIONS | |
DISCONTINUED OPERATIONS | 4. DISCONTINUED OPERATIONS 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. Following the IPO, we retained approximately 75% ownership in Venator. We intend to monetize our retained ownership in Venator at prevailing market conditions and expect to implement multiple follow-on capital market or block transactions to permit the orderly distribution of our retained shares. In August 2017, we entered into a separation agreement, a transition services agreement (“TSA”) and a registration rights agreement with Venator to effect the Separation and provide a framework for a short term set of transition services as well as a tax matters agreement and an employee matters agreement. Pursuant to the TSA, we will, for a limited time following the Separation, provide Venator with certain services and functions that the parties have historically shared, including administrative, payroll, human resources, data processing, environmental, health and safety, financial audit support, financial transaction support, marketing support, information technology systems and various other corporate and support services. We may also provide Venator with additional services that Venator and Huntsman may identify from time to time in the future. In general, the services began following the Separation and cover a period not expected to exceed 24 months; however, Venator may terminate individual services provided by us under the TSA early, as it becomes able to operate its business without such services. The following table summarizes the major classes of assets and liabilities constituting assets and liabilities held for sale: September 30, December 31, 2017 2016 Carrying amounts of major classes of assets held for sale: Accounts receivable $ 411 $ 234 Inventories 432 426 Other current assets 280 117 Total current assets(1) 777 Property, plant and equipment, net 1,290 1,178 Deferred income taxes 195 143 Other noncurrent assets 137 142 Total noncurrent assets(1) 1,463 Total assets held for sale $ 2,745 $ 2,240 Carrying amounts of major classes of liabilities in held for sale: Accounts payable $ 319 $ 297 Accrued liabilities 213 145 Other current liabilities 16 25 Total current liabilities(1) 467 Deferred income taxes — 56 Long term debt 747 — Other noncurrent liabilities 338 337 Total noncurrent liabilities(1) 393 Total liabilities held for sale $ 1,633 $ 860 (1) The assets and liabilities held for sale are classified as current as of September 30, 2017 because it is probable that the sale of the remaining 75% interest in Venator ordinary shares will occur and proceeds will be collected within one year. The following table summarizes major classes of line items constituting pretax and after-tax income of discontinued operations: Huntsman Corporation Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Major classes of line items constituting pretax income (loss) of discontinued operations: Trade sales, services and fees, net $ 589 $ 540 $ 1,700 $ 1,670 Cost of goods sold 470 496 1,421 1,566 Selling, general and administrative 54 42 128 131 Restructuring, impairment and plant closing costs 17 8 51 32 Business separation expenses 11 — 32 — Other operating income, net (51) (23) (83) (37) Other loss (income), net 8 — 9 (2) Income (loss) from discontinued operations before income taxes 80 17 142 (20) Income tax (expense) benefit (17) 7 (41) 8 Income (loss) from discontinued operations, net of tax 63 24 101 (12) Net income attributable to noncontrolling interests (2) (3) (8) (8) Net income (loss) attributable to discontinued operations $ 61 $ 21 $ 93 $ (20) Huntsman International Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Major classes of line items constituting pretax income (loss) of discontinued operations: Trade sales, services and fees, net $ 589 $ 540 $ 1,700 $ 1,670 Cost of goods sold 471 498 1,424 1,571 Selling, general and administrative 54 42 128 131 Restructuring, impairment and plant closing costs 17 8 51 32 Business separation expenses 11 — 32 — Other operating income, net (51) (23) (83) (37) Other loss (income), net 8 — 9 (2) Income (loss) from discontinued operations before income taxes 79 15 139 (25) Income tax (expense) benefit (17) 7 (41) 8 Income (loss) from discontinued operations, net of tax 62 22 98 (17) Net income attributable to noncontrolling interests (2) (3) (8) (8) Net income (loss) attributable to discontinued operations $ 60 $ 19 $ 90 $ (25) |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 9 Months Ended |
Sep. 30, 2017 | |
VARIABLE INTEREST ENTITIES | |
VARIABLE INTEREST ENTITIES | 5. 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 Chemtura 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. · Arabian Amines Company 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 Arabian Amines Company’s production and sell it to our customers. Substantially all of the joint venture’s activities are conducted on our behalf. · Sasol‑Huntsman is our 50%-owned joint venture with Sasol that owns and operates a maleic anhydride facility in Moers, Germany. This joint venture manufactures products for our Performance Products segment. The joint venture uses our technology and expertise, and we bear a disproportionate amount of risk of loss due to a related‑party loan to Sasol‑Huntsman for which we bear the default risk. Creditors of these entities have no recourse to our general credit. See “Note 7. Debt—Direct and Subsidiary Debt.” As the primary beneficiary of these variable interest entities at September 30, 2017, the joint ventures’ assets, liabilities and results of operations are included in our condensed consolidated financial statements. The following table summarizes the carrying amount of our variable interest entities’ assets and liabilities included in our condensed consolidated balance sheets as of September 30, 2017 and our consolidated balance sheets as of December 31, 2016 (dollars in millions): September 30, December 31, 2017 2016 Current assets $ 124 $ 103 Property, plant and equipment, net 272 279 Other noncurrent assets 107 99 Deferred income taxes 43 43 Intangible assets 10 10 Goodwill 14 12 Total assets $ 570 $ 546 Current liabilities $ 131 $ 131 Long-term debt 94 114 Deferred income taxes 11 10 Other noncurrent liabilities 80 76 Total liabilities $ 316 $ 331 The revenues, income from continuing operations before income taxes and net cash provided by operating activities for our variable interest entities for the three and nine months ended September 30, 2017 and 2016 are as follows (dollars in millions): Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Revenues $ 32 $ 24 $ 99 $ 72 Income from continuing operations before income taxes 8 2 22 12 Net cash provided by operating activities 20 13 42 37 Prior to the Separation, we held variable interests in two additional joint ventures for which we were the primary beneficiary: Pacific Iron Products Sdn Bhd and Viance, LLC. In connection with the Separation, these variable interests are now held by Venator. As such, the assets and liabilities of these variable interest entities are now included as part of discontinued operations. See “Note 4. Discontinued Operations.” |
RESTRUCTURING, IMPAIRMENT AND P
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS | 9 Months Ended |
Sep. 30, 2017 | |
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS | |
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS | 6. RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS As of September 30, 2017 and December 31, 2016, accrued restructuring costs of continuing operations by type of cost and initiative consisted of the following (dollars in millions): Non-cancelable Other Workforce Demolition and lease and contract restructuring reductions(1) decommissioning termination costs costs Total(2) Accrued liabilities as of January 1, 2017 $ 4 $ 19 $ 40 $ 5 $ 68 2017 charges for 2016 and prior initiatives — 5 1 1 7 2017 charges for 2017 initiatives 6 — — — 6 2017 payments for 2016 and prior initiatives — (21) (1) (2) (24) 2017 payments for 2017 initiatives (2) — — — (2) Foreign currency effect on liability balance 1 1 2 — 4 Accrued liabilities as of September 30, 2017 $ 9 $ 4 $ 42 $ 4 $ 59 (1) The workforce reduction reserves relate to the termination of 163 positions, of which 116 positions had not been terminated as of September 30, 2017. (2) Accrued liabilities by initiatives were as follows (dollars in millions): September 30, December 31, 2017 2016 2015 and prior initiatives $ 55 $ 67 2016 initiatives — 1 2017 initiatives 4 — Total $ 59 $ 68 Details with respect to our reserves for restructuring, impairment and plant closing costs are provided below by segment and initiative (dollars in millions): Performance Advanced Textile Corporate Polyurethanes Products Materials Effects and other Total Accrued liabilities as of January 1, 2017 $ 2 $ — $ 3 $ 61 $ 2 $ 68 2017 charges for 2016 and prior initiatives — — — 7 — 7 2017 charges for 2017 initiatives — — — 6 — 6 2017 payments for 2016 and prior initiatives (1) — — (23) — (24) 2017 payments for 2017 initiatives — — — (2) — (2) Foreign currency effect on liability balance — — — 4 — 4 Accrued liabilities as of September 30, 2017 $ 1 $ — $ 3 53 $ 2 $ 59 Current portion of restructuring reserves $ 1 $ — $ 2 $ 14 $ 2 $ 19 Long-term portion of restructuring reserves — — 1 39 — 40 Details with respect to cash and noncash restructuring charges from continuing operations for the three and nine months ended September 30, 2017 and 2016 by initiative are provided below (dollars in millions): Three months ended September 30, 2017 Nine months ended September 30, 2017 Cash charges: 2017 charges for 2016 and prior initiatives $ 2 $ 7 2017 charges for 2017 initiatives — 6 Pension-related charges — 1 Accelerated depreciation — 2 Gain on sale of land (1) (3) Total 2017 Restructuring, Impairment and Plant Closing Costs $ 1 $ 13 Three months ended September 30, 2016 Nine months ended September 30, 2016 Cash charges: 2016 charges for 2015 and prior initiatives $ 40 $ 56 2016 charges for 2016 initiatives 1 4 Gain on sale of land (3) (3) Reversal of reserves no longer required — (1) Total 2016 Restructuring, Impairment and Plant Closing Costs $ 38 $ 56 2017 RESTRUCTURING ACTIVITIES In September 2011, we implemented a significant restructuring of our Textile Effects segment, including the closure of our production facilities and business support offices in Basel, Switzerland (the “2011 Textile Effects Restructuring”). In connection with this restructuring plan, during the nine months ended September 30, 2017, our Textile Effects segment recorded restructuring expense of approximately $4 million associated with this initiative. We expect to receive an income of upfront installment payment from the sale of property at the Basel, Switzerland site of approximately $5 million through the end of 2017 to cover our large portion of contract settlement payments. During the first quarter of 2017, we implemented the first phase of 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 nine months ended September 30, 2017 related primarily to workforce reductions. We expect to incur additional charges of approximately $2 million through the end 2017. 2016 RESTRUCTURING ACTIVITIES In December 2015, our Performance Products segment announced plans for a reorganization of its commercial and technical functions and a refocused divisional business strategy to better position the segment for growth in coming years. In addition, a program was launched to capture growth opportunities, improve manufacturing cost efficiency and reduce inventories. In connection with this restructuring program, we recorded restructuring expense of $16 million in the nine months ended September 30, 2016. In connection with the 2011 Textile Effects Restructuring, during the nine months ended September 30, 2016, our Textile Effects segment recorded charges of $8 million for non‑cancelable long‑term contract termination costs and $28 million for decommissioning associated with this initiative. |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2017 | |
DEBT | |
DEBT | 7. DEBT Outstanding debt, net of debt issuance costs, consisted of the following (dollars in millions): Huntsman Corporation September 30, December 31, 2017 2016 Senior Credit Facilities: Term loans $ 592 $ 1,967 Amounts outstanding under A/R programs 184 208 Senior notes 1,913 1,812 Variable interest entities 114 126 Other 71 59 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Total current portion of debt $ 29 $ 50 Long-term portion 2,845 4,122 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Notes payable to affiliates-noncurrent — 1 Total debt $ 2,874 $ 4,173 Huntsman International September 30, December 31, 2017 2016 Senior Credit Facilities: Term loans $ 592 $ 1,967 Amounts outstanding under A/R programs 184 208 Senior notes 1,913 1,812 Variable interest entities 114 126 Other 71 59 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Total current portion of debt $ 29 $ 50 Long-term portion 2,845 4,122 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Notes payable to affiliates-current 100 100 Notes payable to affiliates-noncurrent 717 697 Total debt $ 3,691 $ 4,969 DIRECT AND SUBSIDIARY DEBT Huntsman Corporation’s 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). Huntsman Corporation is not a guarantor of such subsidiary debt. Certain of our subsidiaries are designated as nonguarantor subsidiaries (“Nonguarantors”) 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 September 30, 2017 and December 31, 2016, the amount of debt issuance costs directly reducing the debt liability was $25 million and $57 million, respectively. We record the amortization of debt issuance costs as interest expense. Senior Credit Facilities As of September 30, 2017, our Senior Credit Facilities consisted of our revolving facility (“Revolving Facility”) and our 2023 Term Loan B as follows (dollars in millions): Unamortized Discounts and Committed Principal Debt Issuance Carrying Facility Amount Outstanding Costs Value Interest Rate(3) Maturity Revolving Facility $ 650 $ — $ — $ — USD LIBOR plus 2.50% 2023 Term Loan B N/A 611 (19) 592 USD LIBOR plus 3.00%(2) (1) We had no borrowings outstanding under our Revolving Facility; we had approximately $8 million (U.S. dollar equivalents) of letters of credit and bank guarantees issued and outstanding under our Revolving Facility. (2) The 2023 Term Loan B is subject to a 0.75% LIBOR floor. (3) The applicable interest rate of the Revolving Facility is subject to certain secured leverage ratio thresholds. As of September 30, 2017, the weighted average interest rate on our outstanding balances under the Senior Credit Facilities was approximately 4%. Our obligations under the Senior Credit Facilities are guaranteed by substantially all of our domestic subsidiaries (collectively, the “Guarantors”), and are secured by a first priority lien on substantially all of our domestic property, plant and equipment (other than property, plant and equipment held by Venator and its subsidiaries), the stock of all of our material domestic subsidiaries (other than Venator and its subsidiaries) and certain foreign subsidiaries, and pledges of intercompany notes between certain of our subsidiaries. On October 25, 2017, we made an early prepayment of $100 million on our 2023 Term Loan B from existing cash. In connection with the $100 million prepayment of our term loan, we recognized a loss on early extinguishment of debt of $3 million. In addition, on both April 25, 2017 and July 26, 2017, we made early prepayments of $100 million each on our 2015 Extended Term Loan B from existing cash. In August 2017, we made early prepayments of $1,207 million ($450 million of which constituted a mandatory repayment as described in the seventeenth amendment to the Senior Credit Facilities) on our Senior Credit Facilities, of which $106 million was paid on our 2015 Extended Term Loan B, $347 million was paid on our 2021 Term Loan B, and $754 million was paid on our 2023 Term Loan B. The funds used to pay down the debt included $732 million received from Venator ($750 million of debt raised by Venator net of $18 million of debt issuance costs), upon its payment of intercompany debt obligations owed to Huntsman and $475 million from proceeds of the Venator IPO. In connection with the $1,207 million prepayments of our term loans, we recognized a loss on early extinguishment of debt of $34 million. In connection with the Separation, Venator raised $750 million of new financing, which included (i) $375 million of senior unsecured notes and (ii) $375 million under a new senior secured term loan facility. In addition, Venator entered into a new undrawn asset-based revolving lending facility in aggregate principal amount of up to $300 million. The Venator senior unsecured notes are guaranteed on a general unsecured senior basis by Venator and certain Venator subsidiaries. The Venator senior credit facilities are unconditionally guaranteed, jointly and severally, on a senior secured basis by Venator and certain of its subsidiaries. At Separation, the Venator debt facilities were recorded within current liabilities of discontinued operations. Huntsman Corporation and its direct and indirect subsidiaries (other than Venator and its subsidiaries) do not provide any direct or indirect guarantee for the Venator debt obligations described above and they are non recourse to Huntsman Corporation and its subsidiaries. Seventeenth Amendment to Credit Agreement On June 15, 2017, Huntsman International entered into a seventeenth amendment to the agreement governing the Senior Credit Facilities. The amendment permitted us to complete the Separation. In connection with the Separation, the amendment permitted the incurrence of certain indebtedness of Venator and the internal restructuring of the P&A Business assets. With the completion of the Separation, Venator and its subsidiaries were designated as unrestricted subsidiaries. A/R Programs Our U.S. accounts receivable securitization program (“U.S. A/R Program”) and our European accounts receivable securitization program (“EU A/R Program” and collectively with the U.S. A/R Program, “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. Information regarding our A/R Programs as of September 30, 2017 was as follows (monetary amounts in millions): Maximum Funding Amount Facility Maturity Availability(1) Outstanding Interest Rate(2) U.S. A/R Program April 2020 $ 250 $ 90 (3) Applicable rate plus 0.95% EU A/R Program April 2020 € 150 € 80 Applicable rate plus 1.30% (approximately $176) (approximately $94) (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 either USD LIBOR or CP rate. The applicable rate for our EU A/R Program is either GBP LIBOR, USD LIBOR or EURIBOR. In addition, the U.S. SPE and the EU SPE are obligated to pay unused commitment fees to the lenders based on the amount of each lender’s commitment. (3) As of September 30, 2017, we had approximately $7 million (U.S. dollar equivalents) of letters of credit issued and outstanding under our U.S. A/R Program. On April 21, 2017, we entered into amendments to our A/R Programs that, among other things, extend the scheduled termination dates to April 2020. As of September 30, 2017 and December 31, 2016, $369 million and $328 million, respectively, of accounts receivable were pledged as collateral under our A/R Programs from continuing operations. Note Payable from Huntsman International to Huntsman Corporation As of September 30, 2017, we had a loan of $817 million to our subsidiary, Huntsman International (the “Intercompany Note”). The Intercompany Note is unsecured and $100 million of the outstanding amount is classified as current as of September 30, 2017 on our condensed consolidated balance sheets. As of September 30, 2017, under the terms of the Intercompany Note, Huntsman International promises to pay us interest on the unpaid principal amount at a rate per annum based on the previous monthly average borrowing rate obtained under our U.S. A/R Program, less 10 basis points (provided that the rate shall not exceed an amount that is 25 basis points less than the monthly average borrowing rate obtained for the U.S. LIBOR-based borrowings under our Revolving Facility). COMPLIANCE WITH COVENANTS We believe that we are in compliance with the covenants contained in the agreements governing our material debt instruments, including our Senior Credit Facilities, our A/R Programs and our notes. Our material financing arrangements contain certain covenants with which we must comply. A failure to comply with a covenant could result in a default under a financing arrangement unless we obtained an appropriate waiver or forbearance (as to which we can provide no assurance). A default under these material financing arrangements generally allows debt holders the option to declare the underlying debt obligations immediately due and payable. Furthermore, certain of our material financing arrangements contain cross-default and cross-acceleration provisions under which a failure to comply with the covenants in one financing arrangement may result in an event of default under another financing arrangement. Our Senior Credit Facilities are subject to a single financial covenant (the “Leverage Covenant”), which applies only to the Revolving Facility and is calculated at the Huntsman International level. The Leverage Covenant is applicable only if borrowings, letters of credit or guarantees are outstanding under the Revolving Facility (cash collateralized letters of credit or guarantees are not deemed outstanding). The Leverage Covenant is a net senior secured leverage ratio covenant, which requires that Huntsman International’s ratio of senior secured debt to EBITDA (as defined in the applicable agreement) is not more than 3.75 to 1. If in the future Huntsman International fails to comply with the Leverage Covenant, then we may not have access to liquidity under our Revolving Facility. If Huntsman International failed to comply with the Leverage Covenant at a time when we had uncollateralized loans or letters of credit outstanding under the Revolving Facility, Huntsman International would be in default under the Senior Credit Facilities, and, unless Huntsman International obtained a waiver or forbearance with respect to such default (as to which we can provide no assurance), Huntsman International could be required to pay off the balance of the Senior Credit Facilities in full, and we may not have further access to such facilities. The agreements governing our A/R Programs also contain certain receivable performance metrics. Any material failure to meet the applicable A/R Programs’ metrics in the future 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 Senior Credit Facilities, which could require us to pay off the balance of the Senior Credit Facilities in full and could result in the loss of our Senior Credit Facilities. |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 9 Months Ended |
Sep. 30, 2017 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 8. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES We are exposed to market risks, such as changes in interest rates, foreign exchange rates and commodity pricing risks. From time to time, we enter into transactions, including transactions involving derivative instruments, to manage certain of these exposures. All derivatives, whether designated as 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. To the extent applicable, we perform effectiveness assessments in order to use hedge accounting at each reporting period. For a derivative that does not qualify as a hedge, changes in fair value are recognized in earnings. 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 as an unrealized currency translation adjustment in accumulated other comprehensive loss. Our revenues and expenses are denominated in various foreign currencies, and our cash flows and earnings are thus subject to fluctuations due to exchange rate variations. From time to time, we may 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 one year or less). We do not hedge our foreign currency exposures in a manner that would eliminate the effect of changes in exchange rates on our cash flows and earnings. As of September 30, 2017, we had approximately $81 million in notional amount (in U.S. dollar equivalents) outstanding in forward foreign currency contracts. Huntsman International had entered into several interest rate contracts to hedge the variability caused by monthly changes in cash flow due to associated changes in LIBOR under our Senior Credit Facilities. These swaps were designated as cash flow hedges and the effective portion of the changes in the fair value of the swaps were recorded in other comprehensive income (loss). These swaps expired in April 2017. Beginning in 2009, Arabian Amines Company entered into a 12-year floating to fixed interest rate contract providing for a receipt of LIBOR interest payments for a fixed payment of 5.02%. In connection with the consolidation of Arabian Amines Company as of July 1, 2010, the interest rate contract is now included in our consolidated results. See “Note 5. Variable Interest Entities.” The notional amount of the swap as of September 30, 2017 was $16 million, and the interest rate contract is not designated as a cash flow hedge. As of September 30, 2017, the fair value of the swap was $1 million and was recorded in noncurrent liabilities on our condensed consolidated balance sheets. For each of the nine months ended September 30, 2017 and 2016, we recorded a reduction of interest expense of nil due to changes in fair value of the swap. 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. This swap is designated as a hedge of net investment for financial reporting purposes. Under the cross-currency interest rate contract, we will receive fixed U.S. dollar payments of $5 million semiannually on May 15 and November 15 (equivalent to an annual rate of 5.125%) and make interest payments of approximately €3 million (equivalent to an annual rate of approximately 3.6%). 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 income on our condensed consolidated statements of comprehensive 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 September 30, 2017, we have designated approximately €505 million (approximately $592 million) of euro-denominated debt as a hedge of our net investment. For the nine months ended September 30, 2017, the amount of loss recognized on the hedge of our net investment was $85 million and was recorded in other comprehensive income (loss) on our condensed consolidated statements of comprehensive income. |
FAIR VALUE
FAIR VALUE | 9 Months Ended |
Sep. 30, 2017 | |
FAIR VALUE | |
FAIR VALUE | 9. FAIR VALUE The fair values of financial instruments were as follows (dollars in millions): September 30, 2017 December 31, 2016 Carrying Estimated Carrying Estimated Value Fair Value Value Fair Value Non-qualified employee benefit plan investments $ 30 $ 30 $ 27 $ 27 Investments in equity securities 3 3 18 18 Cross-currency interest rate contracts — — 29 29 Interest rate contracts (1) (1) (2) (2) Long-term debt (including current portion) (2,874) (3,098) (4,172) (4,345) The carrying amounts reported in our condensed consolidated 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. The fair values of non-qualified employee benefit plan investments and investments in equity securities 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 September 30, 2017 and December 31, 2016. The estimated fair value amounts have not been comprehensively revalued for purposes of these financial statements since September 30, 2017 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 in active markets observable unobservable September 30, for identical inputs inputs Description 2017 assets (Level 1)(3) (Level 2)(3) (Level 3) Assets: Available-for sale equity securities: Non-qualified employee benefit plan investments $ 30 $ 30 $ — $ — Investments in equity securities 3 3 — — Derivatives: Cross-currency interest rate contracts(1) — — — — Total assets $ 33 $ 33 $ — $ — Liabilities: Derivatives: Interest rate contracts(2) $ (1) $ — $ (1) $ — Fair Value Amounts Using Quoted prices Significant other Significant in active markets observable unobservable December 31, for identical inputs inputs Description 2016 assets (Level 1)(3) (Level 2)(3) (Level 3) Assets: Available-for sale equity securities: Non-qualified employee benefit plan investments $ 27 $ 27 $ — $ — Investments in equity securities 18 18 — — Derivatives: Cross-currency interest rate contracts(1) 29 — — 29 Total assets $ 74 $ 45 $ — $ 29 Liabilities: Derivatives: Interest rate contracts(2) $ (2) $ — $ (2) $ — (1) The income approach is used to calculate the fair value of these instruments. Fair value represents the present value of estimated future cash flows, calculated using relevant interest rates, exchange rates, and yield curves at stated intervals. There were no material changes to the valuation methods or assumptions used to determine the fair value during the current period. In November 2014, we entered into two five year cross-currency interest rate contracts and one eight year cross-currency interest rate contract. These instruments had been categorized by us as Level 3 within the fair value hierarchy due to unobservable inputs associated with the credit valuation adjustment, which we deemed to be significant inputs to the overall measurement of fair value at inception. In August 2017, we terminated these cross-currency interest rate contracts and received $7 million in payments from the counterparties. (2) The income approach is used to calculate the fair value of these instruments. Fair value represents the present value of estimated future cash flows, calculated using relevant interest rates and yield curves at stated intervals. There were no material changes to the valuation methods or assumptions used to determine the fair value during the current period. (3) There were no transfers between Levels 1 and 2 within the fair value hierarchy during the nine months ended September 30, 2017 and the year ended December 31, 2016. The following table shows a reconciliation of beginning and ending balances for the three and nine months ended September 30, 2017 and 2016 for instruments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (dollars in millions). Three months Nine months ended ended September 30, 2017 September 30, 2017 Cross-Currency Cross-Currency Interest Interest Rate Contracts Rate Contracts Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Beginning balance $ 16 $ 29 Transfers into Level 3 — — Transfers out of Level 3 — — Total (losses) gains: Included in earnings — — Included in other comprehensive income (loss) (9) (22) Purchases, sales, issuances and settlements (7) (7) Ending balance, September 30, 2017 $ — $ — The amount of total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets still held at September 30, 2017 $ — $ — Three months Nine months ended ended September 30, 2016 September 30, 2016 Cross-Currency Cross-Currency Interest Interest Rate Contracts Rate Contracts Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Beginning balance $ 26 $ 28 Transfers into Level 3 — — Transfers out of Level 3 — — Total (losses) gains: Included in earnings — — Included in other comprehensive income (loss) (5) (7) Purchases, sales, issuances and settlements — — Ending balance, September 30, 2016 $ 21 $ 21 The amount of total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets still held at September 30, 2016 $ — $ — Gains and losses (realized and unrealized) included in earnings for instruments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) are reported in interest expense and other comprehensive income (loss) as follows (dollars in millions): Three months Nine months ended ended September 30, 2017 September 30, 2017 Other Other Interest comprehensive Interest comprehensive 2017 expense income (loss) expense income (loss) Total net gains included in earnings $ — $ — $ — $ — Changes in unrealized losses — (9) — (22) Three months Nine months ended ended September 30, 2016 September 30, 2016 Other Other Interest comprehensive Interest comprehensive 2016 expense income (loss) expense income (loss) Total net gains included in earnings $ — $ — $ — $ — Changes in unrealized losses relating to assets still held at September 30, 2016 — (5) — (7) We also have assets that under certain conditions are subject to measurement at fair value on a non‑recurring basis. These assets include property, plant and equipment and those associated with acquired businesses, including goodwill and intangible assets. For these assets, measurement at fair value in periods subsequent to their initial recognition is applicable if one or more is determined to be impaired. During each of the three and nine months ended September 30, 2017 and 2016, we recorded charges of nil for the impairment of long‑lived assets. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 9 Months Ended |
Sep. 30, 2017 | |
EMPLOYEE BENEFIT PLANS | |
EMPLOYEE BENEFIT PLANS | 10. EMPLOYEE BENEFIT PLANS Components of the net periodic benefit costs from continuing operations for the three and nine months ended September 30, 2017 and 2016 were as follows (dollars in millions): Huntsman Corporation Other Postretirement Defined Benefit Plans Benefit Plans Three months Three months ended ended September 30, September 30, 2017 2016 2017 2016 Service cost $ 16 $ 15 $ 1 $ 1 Interest cost 20 22 1 1 Expected return on assets (39) (37) — — Amortization of prior service benefit (2) (2) (2) (2) Amortization of actuarial loss 19 15 1 — Net periodic benefit cost $ 14 $ 13 $ 1 $ — Other Postretirement Defined Benefit Plans Benefit Plans Nine months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Service cost $ 47 $ 44 $ 2 $ 2 Interest cost 59 67 3 3 Expected return on assets (116) (111) — — Amortization of prior service benefit (5) (7) (5) (5) Amortization of actuarial loss 56 43 2 1 Special termination benefits 1 — — — Net periodic benefit cost $ 42 $ 36 $ 2 $ 1 Huntsman International Other Postretirement Defined Benefit Plans Benefit Plans Three months Three months ended ended September 30, September 30, 2017 2016 2017 2016 Service cost $ 16 $ 15 $ 1 $ 1 Interest cost 20 22 1 1 Expected return on assets (39) (37) — — Amortization of prior service benefit (2) (2) (2) (2) Amortization of actuarial loss 20 16 1 — Net periodic benefit cost $ 15 $ 14 $ 1 $ — Other Postretirement Defined Benefit Plans Benefit Plans Nine months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Service cost $ 47 $ 44 $ 2 $ 2 Interest cost 59 67 3 3 Expected return on assets (116) (111) — — Amortization of prior service benefit (5) (7) (5) (5) Amortization of actuarial loss 58 45 2 1 Special termination benefits 1 — — — Net periodic benefit cost $ 44 $ 38 $ 2 $ 1 During the nine months ended September 30, 2017 and 2016, we made contributions to our pension and other postretirement benefit plans related to continuing operations of $80 million and $38 million, respectively. During the remainder of 2017, we expect to contribute an additional amount of approximately $17 million to these plans. |
COMMON STOCK DIVIDENDS
COMMON STOCK DIVIDENDS | 9 Months Ended |
Sep. 30, 2017 | |
COMMON STOCK DIVIDENDS | |
COMMON STOCK DIVIDENDS | 11. COMMON STOCK DIVIDENDS During each of the quarters ended September 30, 2017 and 2016, June 30, 2017 and 2016 and March 31, 2017 and 2016, we paid dividends of $30 million, or $0.125 per share, to common stockholders. |
OTHER COMPREHENSIVE INCOME (LOS
OTHER COMPREHENSIVE INCOME (LOSS) | 9 Months Ended |
Sep. 30, 2017 | |
OTHER COMPREHENSIVE INCOME (LOSS) | |
OTHER COMPREHENSIVE INCOME (LOSS) | 12. OTHER COMPREHENSIVE INCOME (LOSS) The components of other comprehensive income (loss) and changes in accumulated other comprehensive loss by component were as follows (dollars in millions): Huntsman Corporation Pension and Other Foreign other comprehensive Amounts Amounts currency postretirement income of attributable to attributable to translation benefits unconsolidated noncontrolling Huntsman adjustment(a) adjustments(b) affiliates Other, net Total interests Corporation Beginning balance, January 1, 2017 $ (459) $ (1,275) $ 4 $ 23 $ (1,707) $ 36 $ (1,671) Other comprehensive income before reclassifications, gross 170 — (1) 7 176 (12) 164 Tax benefit 31 — — (1) 30 — 30 Amounts reclassified from accumulated other comprehensive loss, gross(c) — 60 — (8) 52 — 52 Tax expense — (5) — — (5) — (5) Net current-period other comprehensive income (loss) 201 55 (1) (2) 253 (12) 241 Disposition of a portion of P&A Business — — — — — 72 72 Ending balance, September 30, 2017 $ (258) $ (1,220) $ 3 $ 21 $ (1,454) $ 96 $ (1,358) (a) Amounts are net of tax of $69 and $100 as of September 30, 2017 and January 1, 2017, respectively. (b) Amounts are net of tax of $172 and $177 as of September 30, 2017 and January 1, 2017, respectively. (c) See table below for details about these reclassifications. Pension and Other Foreign other comprehensive Amounts Amounts currency postretirement income of attributable to attributable to translation benefits unconsolidated noncontrolling Huntsman adjustment(a) adjustments(b) affiliates Other, net Total interests Corporation Beginning balance, January 1, 2016 $ (288) $ (1,056) $ 11 $ 17 $ (1,316) $ 28 $ (1,288) Other comprehensive (loss) income before reclassifications, gross (18) — (8) 6 (20) — (20) Tax benefit 7 — — — 7 — 7 Amounts reclassified from accumulated other comprehensive loss, gross(c) — 40 — — 40 — 40 Tax expense — (5) — — (5) — (5) Net current-period other comprehensive (loss) income (11) 35 (8) 6 22 — 22 Ending balance, September 30, 2016 $ (299) $ (1,021) $ 3 $ 23 $ (1,294) $ 28 $ (1,266) (a) (b) (c) Three months ended Nine months ended September 30, 2017 September 30, 2017 Amount reclassified Amount reclassified Affected line item in from accumulated from accumulated the statement Details about Accumulated Other other other where net income Comprehensive Loss Components(a): comprehensive loss comprehensive loss is presented Amortization of pension and other postretirement benefits: Prior service credit $ (4) $ (11) (b) Actuarial loss 25 71 (b)(c) 21 60 Total before tax (3) (5) Income tax expense Total reclassifications for the period $ 18 $ 55 Net of tax Three months ended Nine months ended September 30, 2016 September 30, 2016 Amount reclassified Amount reclassified Affected line item in from accumulated from accumulated the statement Details about Accumulated Other other other where net income Comprehensive Loss Components(a): comprehensive loss comprehensive loss is presented Amortization of pension and other postretirement benefits: Prior service credit $ (4) $ (12) (b) Actuarial loss 17 52 (b)(c) 13 40 Total before tax (2) (5) Income tax expense Total reclassifications for the period $ 11 $ 35 Net of tax (a) Pension and other postretirement benefits amounts in parentheses indicate credits on our condensed consolidated statements of operations. (b) These accumulated other comprehensive loss components are included in the computation of net periodic pension costs. See “Note 10. Employee Benefit Plans.” (c) Amounts contain approximately $6 and $4 of actuarial losses related to discontinued operations for the three months ended September 30, 2017 and 2016, respectively and $18 and $11 of actuarial losses related to discontinued operations for the nine months ended September 30, 2017 and 2016, respectively. Huntsman International Foreign Pension Other Other, net Total Amounts Amounts Beginning balance, January 1, 2017 $ (462) $ (1,286) $ 4 $ 17 $ (1,727) $ 36 $ (1,691) Other comprehensive income before reclassifications, gross 169 — (1) 8 176 (12) 164 Tax benefit 30 — — (1) 29 — 29 Amounts reclassified from accumulated other comprehensive loss, gross(c) — 65 — (8) 57 — 57 Contribution of other comprehensive income from Parent — 20 — — 20 — 20 Tax expense — (5) — — (5) — (5) Net current-period other comprehensive income (loss) 199 80 (1) (1) 277 (12) 265 Disposition of a portion of P&A Business — — — — — 72 72 Ending balance, September 30, 2017 $ (263) $ (1,206) $ 3 $ 16 $ (1,450) $ 96 $ (1,354) (a) Amounts are net of tax of $56 and $86 as of September 30, 2017 and January 1, 2017, respectively. (b) Amounts are net of tax of $200 and $205 as of September 30, 2017 and January 1, 2017, respectively. (c) See table below for details about these reclassifications. Foreign Pension Other Other, net Total Amounts Amounts Beginning balance, January 1, 2016 $ (292) $ (1,074) $ 11 $ 11 $ (1,344) $ 28 $ (1,316) Other comprehensive (loss) income before reclassifications, gross (18) — (8) 6 (20) — (20) Tax benefit 7 — — — 7 — 7 Amounts reclassified from accumulated other comprehensive loss, gross(c) — 46 — — 46 — 46 Tax expense — (6) — — (6) — (6) Net current-period other comprehensive income (loss) (11) 40 (8) 6 27 — 27 Ending balance, September 30, 2016 $ (303) $ (1,034) $ 3 $ 17 $ (1,317) $ 28 $ (1,289) (a) Amounts are net of tax of $69 and $76 as of September 30, 2016 and January 1, 2016, respectively. (b) Amounts are net of tax of $157 and $163 as of both September 30, 2016 and January 1, 2016, respectively. (c) See table below for details about these reclassifications. Three months ended Nine months ended September 30, 2017 September 30, 2017 Amount reclassified Amount reclassified Affected line item in from accumulated from accumulated the statement Details about Accumulated Other other other where net income Comprehensive Loss Components(a): comprehensive loss comprehensive loss is presented Amortization of pension and other postretirement benefits: Prior service credit $ (4) $ (11) (b) Actuarial loss 26 76 (b)(c) 22 65 Total before tax (3) (5) Income tax expense Total reclassifications for the period $ 19 $ 60 Net of tax Three months ended Nine months ended September 30, 2016 September 30, 2016 Amount reclassified Amount reclassified Affected line item in from accumulated from accumulated the statement Details about Accumulated Other other other where net income Comprehensive Loss Components(a): comprehensive loss comprehensive loss is presented Amortization of pension and other postretirement benefits: Prior service credit $ (4) $ (12) (b) Actuarial loss 20 58 (b)(c) 16 46 Total before tax (2) (6) Income tax expense Total reclassifications for the period $ 14 $ 40 Net of tax (a) Pension and other postretirement benefits amounts in parentheses indicate credits on our condensed consolidated statements of operations. (b) These accumulated other comprehensive loss components are included in the computation of net periodic pension costs. See “Note 10. Employee Benefit Plans.” (c) Amounts contain approximately $6 and $4 of actuarial losses related to discontinued operations for the three months ended September 30, 2017 and 2016, respectively and $18 and $11 of actuarial losses related to discontinued operations for the nine months ended September 30, 2017 and 2016, respectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2017 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 13. COMMITMENTS AND CONTINGENCIES LEGAL MATTERS Product Delivery Claim We have been notified by a customer of potential claims related to our alleged delivery of a different product than the one the customer had ordered. Our customer claims that it was unaware that the different product had been delivered until after that product had been used to manufacture materials which were subsequently sold. Originally, the customer stated that it had been notified of claims by its customers of up to an aggregate of €153 million (approximately $179 million) relating to this matter and claimed that we may be responsible for all or a portion of these potential claims. Our customer has since resolved some of these claims and the aggregate amount of the current claims is now approximately €113 million (approximately $132 million). Based on the facts currently available, we believe that we are insured for any liability we may ultimately have in excess of $10 million. However, no assurance can be given regarding our ultimate liability or costs. We believe our range of possible loss in this matter is between €0 and €113 million (approximately $132 million), and we have made no accrual with respect to this matter. Indemnification Matters On July 3, 2012, Deutsche Bank Securities Inc. and Credit Suisse Securities (USA) LLC (“the Banks”) demanded that we indemnify them for claims brought against them by certain MatlinPatterson entities that were formerly our stockholders (“MatlinPatterson”) in litigation filed by MatlinPatterson on June 19, 2012 in the 9th District Court in Montgomery County, Texas (the “Texas Litigation”). We denied the Banks’ indemnification demand for the Texas Litigation. These claims allegedly arose from the failed acquisition by and merger with Hexion. The Texas Litigation was dismissed, which was upheld by the Ninth Court of Appeals and the Texas Supreme Court denied review by final order entered January 7, 2016. On July 14, 2014, the Banks demanded that we indemnify them for additional claims brought against them by certain other former Company stockholders in litigation filed June 14, 2014 in the United States District Court for the Eastern District of Wisconsin (the “Wisconsin Litigation”). We denied the Banks’ indemnification demand for the Wisconsin Litigation and have made no accrual with respect to this matter. The stockholders in the Wisconsin Litigation have made essentially the same factual allegations as MatlinPatterson made in the Texas Litigation and, additionally, have named Apollo Global Management LLC and Apollo Management Holdings, L.P. as defendants. Stockholder plaintiffs in the Wisconsin Litigation assert claims for misrepresentation and conspiracy to defraud. On June 30, 2016, the plaintiffs voluntarily dismissed the Apollo defendants and on December 5, 2016, the court dismissed Deutsche Bank for lack of personal jurisdiction, but denied Credit Suisse's motion to dismiss. Subsequently, Credit Suisse asked the court to reconsider its decision or certify its judgment to the Seventh Circuit Court of Appeals for an immediate appeal, which remains pending. Subsequent to discovery, Credit Suisse filed a motion for summary judgment on August 25, 2017, which also remains pending. Other Proceedings 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. |
ENVIRONMENTAL, HEALTH AND SAFET
ENVIRONMENTAL, HEALTH AND SAFETY MATTERS | 9 Months Ended |
Sep. 30, 2017 | |
ENVIRONMENTAL, HEALTH AND SAFETY MATTERS | |
ENVIRONMENTAL, HEALTH AND SAFETY MATTERS | 14. 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 nine months ended September 30, 2017 and 2016, our capital expenditures for EHS matters totaled $23 million and $33 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 accrued $22 million for environmental liabilities for both September 30, 2017 and December 31, 2016. Of these amounts, $4 million and $7 million were classified as accrued liabilities in each of our condensed consolidated balance sheets as of September 30, 2017 and December 31, 2016, respectively, and $18 million and $15 million were classified as other noncurrent liabilities in our condensed consolidated balance sheets as of September 30, 2017 and December 31, 2016, respectively. 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 condensed 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. West Footscray Remediation By letter dated March 7, 2006, our former Base Chemicals and Polymers facility in West Footscray, Australia was issued a cleanup notice by the Environmental Protection Authority Victoria ("EPA Victoria") due to concerns about soil and groundwater contamination emanating from the site. On August 23, 2010, EPA Victoria revoked a second cleanup notice and issued a revised notice that included a requirement for financial assurance for the remediation. As of September 30, 2017, we had an accrued liability of approximately $15 million related to estimated environmental remediation costs at this site. We can provide no assurance that the authority will not seek to institute additional requirements for the site or that additional costs will not be required for the cleanup. 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. |
STOCK-BASED COMPENSATION PLAN
STOCK-BASED COMPENSATION PLAN | 9 Months Ended |
Sep. 30, 2017 | |
STOCK-BASED COMPENSATION PLAN | |
STOCK-BASED COMPENSATION PLAN | 15. STOCK‑BASED COMPENSATION PLANS 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. In connection with the Separation, certain individuals who were granted awards under the 2016 Stock Incentive Plan and the Prior Plan terminated from Huntsman and are now affiliated with Venator. The unvested awards previously granted to these individuals were converted to awards under Venator’s stock incentive plan during August 2017. As of September 30, 2017, we were authorized to grant up to 8.2 million shares under the 2016 Stock Incentive Plan. As of September 30, 2017, 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 annually over a three-year period. In connection with the Separation, certain individuals who were granted awards under the 2016 Stock Incentive Plan and the Prior Plan were transferred to Venator. The unvested awards under the 2016 Stock Incentive Plan and the Prior Plan previously granted to these individuals were converted to awards under Venator’s stock incentive plan during August 2017. The compensation cost from continuing operations under the 2016 Stock Incentive Plan and the Prior Plan for our Company and Huntsman International were as follows (dollars in millions): Three months ended Nine months ended ended ended September 30, September 30, 2017 2016 2017 2016 Huntsman Corporation compensation cost $ 8 $ 7 $ 25 $ 23 Huntsman International compensation cost 8 7 24 22 The total income tax benefit recognized in the condensed consolidated statements of operations for us and Huntsman International for stock-based compensation arrangements was $6 million and $5 million for the nine months ended September 30, 2017 and 2016, 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 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 average of the assumptions utilized for stock options granted during the periods. Three months ended Nine months ended ended ended September 30, September 30, 2017 2016 2017 2016 Dividend yield NA 3.3 % 2.4 % 5.6 % Expected volatility NA 57.6 % 56.9 % 57.9 % Risk-free interest rate NA 1.1 % 2.0 % 1.4 % Expected life of stock options granted during the period NA 5.9 years 5.9 years 5.9 years During the three months ended September 30, 2017, no stock options were granted. A summary of stock option activity under the 2016 Stock Incentive Plan and the Prior Plan as of September 30, 2017 and changes during the nine months then ended is presented below: Weighted Weighted Average Average Remaining Aggregate Exercise Contractual Intrinsic Option Awards Shares Price Term Value (in thousands) (years) (in millions) Outstanding at January 1, 2017 11,245 $ 13.37 Granted 997 21.04 Exercised (2,118) 17.59 Forfeited (59) 17.39 Converted to Venator awards (417) 5.00 Outstanding at September 30, 2017 9,648 13.17 5.7 $ 137 Exercisable at September 30, 2017 6,822 12.88 4.6 99 The weighted‑average grant‑date fair value of stock options granted during the nine months ended September 30, 2017 was $9.26 per option. As of September 30, 2017, there was $11 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 1.9 years. The total intrinsic value of stock options exercised during the nine months ended September 30, 2017 and 2016 was approximately $11 million and nil, respectively. Cash received from stock options exercised during the nine months ended September 30, 2017 and 2016 was approximately $22 million and nil, respectively. The cash tax benefit from stock options exercised during the nine months ended September 30, 2017 and 2016 was approximately $3 million and nil, 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 nine months ended September 30, 2017 and 2016, the weighted-average expected volatility rate was 45.0% and 39.3%, respectively, and the weighted average risk-free interest rate was 1.5% and 0.9%, respectively. For the performance share unit awards granted in the nine months ended September 30, 2017 and 2016, 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. A summary of the status of our nonvested shares as of September 30, 2017 and changes during the nine months then ended is presented below: Equity Awards Liability Awards Weighted Weighted Average Average Grant- Date Grant-Date Shares Fair Value Shares Fair Value (in thousands) (in thousands) Nonvested at January 1, 2017 2,996 $ 13.36 912 $ 12.27 Granted 779 22.60 285 21.01 Vested (937) (1) 16.30 (370) 14.11 Forfeited (21) 15.23 (32) 12.37 Converted to Venator awards (237) 11.81 (93) 13.72 Nonvested at September 30, 2017 2,580 14.92 702 14.66 (1) As of September 30, 2017, a total of 460,750 restricted stock units were vested but not yet issued, of which 25,704 vested during the nine months ended September 30, 2017. 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. As of September 30, 2017, there was $32 million of total unrecognized compensation cost related to nonvested share compensation 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 1.9 years. The value of share awards that vested during the nine months ended September 30, 2017 and 2016 was $20 million and $15 million, respectively. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2017 | |
INCOME TAXES | |
INCOME TAXES | 16. 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 an individual 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. These conclusions require significant judgment. In evaluating the objective evidence that historical results provide, we consider the cyclicality of our businesses and cumulative income or losses during the applicable period. Cumulative losses incurred over the applicable 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. During the nine months ended September 30, 2017, we released a valuation allowance of $7 million on certain net deferred assets of our Polyurethanes business in Italy. On March 1, 2017 and April 1, 2017, we demerged the Italian legal entities containing our Polyurethanes business from our combined Italian tax group. The historical and expected continued profitability of that Polyurethanes business resulted in the release of the associated valuation allowance. During the same period, we also released a valuation allowance of $13 million on certain deferred tax assets in Luxembourg 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. During the nine months ended September 30, 2017 and 2016, for unrecognized tax benefits that impact tax expense, we recorded a net increase in unrecognized tax benefits and a corresponding income tax expense of $7 million and $3 million, respectively. Additional increases and decreases in unrecognized tax benefits were offset by cash settlements or decreases in net deferred tax assets and, therefore, did not affect income tax expense. We recorded an additional income tax liability of approximately $45 million related to our tax gain on the Venator IPO proceeds, net of separation costs and IPO expenses. Huntsman Corporation We recorded income tax expense from continuing operations of $78 million and $65 million for the nine months ended September 30, 2017 and 2016, respectively. Our 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. Our effective tax rate was 18% for the nine months ended September 30, 2017. Higher than expected earnings in countries with low tax rates or valuation allowances, and the release of certain valuation allowances in Italy and Luxenbourg, resulted in a lower effective tax rate through the third quarter of 2017. Huntsman International Huntsman International recorded income tax expense from continuing operations of $77 million and $65 million for the nine months ended September 30, 2017 and 2016, respectively. Our 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. Our effective tax rate was 18% for the nine months ended September 30, 2017. Higher than expected earnings in countries with low tax rates and valuation allowances, and the release of certain valuation allowances in Italy and Luxenbourg, resulted in a lower effective tax rate through the third quarter of 2017. |
NET INCOME PER SHARE
NET INCOME PER SHARE | 9 Months Ended |
Sep. 30, 2017 | |
NET INCOME PER SHARE | |
NET INCOME PER SHARE | 17. NET INCOME PER SHARE 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): Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Numerator: Basic and diluted income from continuing operations: Income from continuing operations attributable to Huntsman Corporation $ 84 $ 31 $ 289 $ 210 Basic and diluted net income: Net income attributable to Huntsman Corporation $ 147 $ 55 $ 390 $ 198 Denominator: Weighted average shares outstanding 238.5 236.3 238.0 236.2 Dilutive shares: Stock-based awards 5.5 3.8 5.5 2.9 Total weighted average shares outstanding, including dilutive shares 244.0 240.1 243.5 239.1 Additional stock‑based awards of 0.9 million and 5.5 million weighted average equivalent shares of stock were outstanding during the three months ended September 30, 2017 and 2016, respectively, and 1.8 million and 5.9 million weighted average equivalent shares of stock were outstanding during the nine months ended September 30, 2017 and 2016, respectively. However, these stock‑based awards were not included in the computation of diluted earnings per share for the three and nine months ended September 30, 2017 and 2016 because the effect would be anti‑dilutive. |
OPERATING SEGMENT INFORMATION
OPERATING SEGMENT INFORMATION | 9 Months Ended |
Sep. 30, 2017 | |
OPERATING SEGMENT INFORMATION | |
OPERATING SEGMENT INFORMATION | 18. 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. 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 the P&A Business as discontinued operations in our condensed consolidated financial statements for all periods presented. See “Note 4. Discontinued Operations.” The major products of each reportable operating segment are as follows: Segment Products Polyurethanes MDI, PO, polyols, PG, TPU, aniline and MTBE Performance Products amines, surfactants, LAB, maleic anhydride, other performance chemicals, EG, olefins and technology licenses Advanced Materials 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 Sales between segments are generally recognized at external market prices and are eliminated in consolidation. Adjusted EBITDA is presented as a measure of the financial performance of our global business units and for reporting the results of our operating segments. 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): Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Revenues: Polyurethanes $ 1,197 $ 891 $ 3,172 $ 2,703 Performance Products 501 509 1,595 1,611 Advanced Materials 263 247 782 774 Textile Effects 193 184 586 567 Corporate and eliminations 15 — 20 (41) Total $ 2,169 $ 1,831 $ 6,155 $ 5,614 Huntsman Corporation: Segment adjusted EBITDA(1): Polyurethanes $ 245 $ 137 $ 556 $ 439 Performance Products 63 70 249 248 Advanced Materials 56 55 166 173 Textile Effects 19 17 64 59 Corporate and other(2) (43) (45) (136) (132) Total 340 234 899 787 Reconciliation of adjusted EBITDA to net income: Interest expense—continuing operations (39) (52) (134) (153) Interest (expense) income—discontinued operations (8) — (8) 1 Income tax expense—continuing operations (35) (6) (78) (65) Income tax (expense) benefit—discontinued operations (17) 7 (41) 8 Depreciation and amortization—continuing operations (80) (83) (235) (238) Depreciation and amortization—discontinued operations (9) (30) (68) (84) Net income attributable to noncontrolling interests 32 9 64 22 Other adjustments: Business acquisition and integration expenses (10) (6) (17) (11) Merger costs (12) — (18) — EBITDA from discontinued operations 97 47 218 63 Minority interest of discontinued operations (12) (3) (18) (8) Loss on early extinguishment of debt (35) (1) (36) (3) Certain legal settlements and related expenses — — (1) — Gain on sale of assets — — 8 — Amortization of pension and postretirement actuarial losses (19) (14) (55) (42) Plant incident remediation costs (13) — (13) — Restructuring, impairment and plant closing and transition costs (1) (38) (13) (57) Net income $ 179 $ 64 $ 454 $ 220 Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Huntsman International: Segment adjusted EBITDA(1): Polyurethanes $ 245 $ 137 $ 556 $ 439 Performance Products 63 70 249 248 Advanced Materials 56 55 166 173 Textile Effects 19 17 64 59 Corporate and other(2) (41) (43) (132) (128) Total 342 236 903 791 Reconciliation of adjusted EBITDA to net income: Interest expense—continuing operations (44) (55) (146) (162) Interest (expense) income—discontinued operations (8) — (8) 1 Income tax expense—continuing operations (34) (7) (77) (65) Income tax (expense) benefit—discontinued operations (17) 7 (41) 8 Depreciation and amortization—continuing operations (78) (79) (227) (228) Depreciation and amortization—discontinued operations (9) (30) (68) (84) Net income attributable to noncontrolling interests 32 9 64 22 Other adjustments: Business acquisition and integration expenses (10) (6) (17) (11) Merger costs (12) — (18) — EBITDA from discontinued operations 96 45 215 58 Minority interest of discontinued operations (12) (3) (18) (8) Loss on early extinguishment of debt (35) (1) (36) (3) Certain legal settlements and related expenses — — (1) — Gain on sale of assets — — 8 — Amortization of pension and postretirement actuarial losses (20) (15) (57) (44) Plant incident remediation costs (13) — (13) — Restructuring, impairment and plant closing and transition costs (1) (38) (13) (57) Net income $ 177 $ 63 $ 450 $ 218 (1) Segment adjusted EBITDA is defined as net income of Huntsman Corporation or Huntsman International, as appropriate, before interest, income tax, depreciation and amortization, net income attributable to noncontrolling interests and certain Corporate and other items, as well as eliminating the following adjustments: (a) business acquisition and integration expenses; (b) merger costs; (c) EBITDA from discontinued operations; (d) minority interest of discontinued operations; (e) loss on early extinguishment of debt; (f) certain legal settlements and related expenses; (g) gain on sale of assets; (h) amortization of pension and postretirement actuarial losses; (i) net plant incident credits (costs); and (j) restructuring, impairment and plant closing and transition costs. (2) Corporate and other includes unallocated corporate overhead, unallocated foreign 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, benzene sales and gains and losses on the disposition of corporate assets. |
CONDENSED CONSOLIDATING FINANCI
CONDENSED CONSOLIDATING FINANCIAL INFORMATION - HUNTSMAN INTERNATIONAL | 9 Months Ended |
Sep. 30, 2017 | |
CONDENSED CONSOLIDATING FINANCIAL INFORMATION - HUNTSMAN INTERNATIONAL | |
CONDENSED CONSOLIDATING FINANCIAL INFORMATION - HUNTSMAN INTERNATIONAL | 19. CONDENSED CONSOLIDATING FINANCIAL INFORMATION OF HUNTSMAN INTERNATIONAL LLC The following unaudited condensed consolidating financial statements present, in separate columns, financial information for the following: Huntsman International (on a parent only basis), with its investment in subsidiaries recorded under the equity method; the Guarantors on a combined, and where appropriate, consolidated basis; and the Nonguarantors on a combined, and where appropriate, consolidated basis. Additional columns present eliminating adjustments and consolidated totals as of September 30, 2017 and December 31, 2016 and for the three and nine months ended September 30, 2017 and 2016. There are no contractual restrictions limiting transfers of cash from the Guarantors to Huntsman International. Each of the Guarantors is 100% owned by Huntsman International and has fully and unconditionally guaranteed, subject to certain customary release provisions, Huntsman International’s outstanding notes on a joint and several basis. In connection with the separation of the P&A business during the third quarter of 2017 (see “Note 4. Discontinued Operations”), certain entities were removed from the debt guarantor structure. The following unaudited condensed financial statements have been presented as if the new debt guarantor structure existed for all periods presented. HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEETS AS OF SEPTEMBER 30, 2017 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC ASSETS Current assets: Cash and cash equivalents $ 56 $ — $ 382 $ — $ 438 Restricted cash — — 11 — 11 Accounts and notes receivable, net 36 73 1,108 5 1,222 Accounts receivable from affiliates 873 4,213 122 (4,855) 353 Inventories 81 201 808 (6) 1,084 Prepaid expenses 18 6 31 (9) 46 Other current assets 735 3 195 (740) 193 Current assets held for sale — — 2,745 — 2,745 Total current assets 1,799 4,496 5,402 (5,605) 6,092 Property, plant and equipment, net 451 1,111 1,469 — 3,031 Investment in unconsolidated affiliates 6,074 2,302 255 (8,376) 255 Intangible assets, net 27 — 30 — 57 Goodwill (14) 82 71 — 139 Deferred income taxes 510 — 280 (522) 268 Notes receivable from affiliates 111 565 — (676) — Other noncurrent assets 47 172 245 — 464 Total assets $ 9,005 $ 8,728 $ 7,752 $ (15,179) $ 10,306 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 60 $ 175 $ 631 $ 5 $ 871 Accounts payable to affiliates 3,783 537 602 (4,855) 67 Accrued liabilities 88 825 375 (750) 538 Note payable to affiliate 100 — — — 100 Current portion of debt 5 — 24 — 29 Current liabilities held for sale — — 1,633 — 1,633 Total current liabilities 4,036 1,537 3,265 (5,600) 3,238 Long-term debt 2,504 — 341 — 2,845 Notes payable to affiliates 717 — 676 (676) 717 Deferred income taxes — 281 66 74 421 Other noncurrent liabilities 173 268 589 — 1,030 Total liabilities 7,430 2,086 4,937 (6,202) 8,251 Equity Huntsman International LLC members’ equity Members’ equity 3,412 2,256 3,484 (5,740) 3,412 Accumulated (deficit) income (483) 2,908 166 (3,074) (483) Accumulated other comprehensive (loss) income (1,354) 1,478 (1,304) (174) (1,354) Total Huntsman International LLC members’ equity 1,575 6,642 2,346 (8,988) 1,575 Noncontrolling interests in subsidiaries — — 469 11 480 Total equity 1,575 6,642 2,815 (8,977) 2,055 Total liabilities and equity $ 9,005 $ 8,728 $ 7,752 $ (15,179) $ 10,306 HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEETS AS OF DECEMBER 31, 2016 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC ASSETS Current assets: Cash and cash equivalents $ 37 $ — $ 347 $ — $ 384 Restricted cash — — 11 — 11 Accounts and notes receivable, net 22 88 1,053 5 1,168 Accounts receivable from affiliates 1,351 4,589 149 (5,760) 329 Inventories 85 183 652 (2) 918 Prepaid expenses 68 46 36 (101) 49 Other current assets 820 3 129 (725) 227 Current assets held for sale — — 777 — 777 Total current assets 2,383 4,909 3,154 (6,583) 3,863 Property, plant and equipment, net 463 1,163 1,385 1 3,012 Investment in unconsolidated affiliates 5,870 1,458 245 (7,325) 248 Intangible assets, net 28 — 15 — 43 Goodwill (12) 82 51 — 121 Deferred income taxes 515 — 265 (527) 253 Notes receivable from affiliates 37 620 — (657) — Other noncurrent assets 74 188 210 — 472 Noncurrent assets held for sale — — 1,463 — 1,463 Total assets $ 9,358 $ 8,420 $ 6,788 $ (15,091) $ 9,475 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 63 $ 152 $ 553 $ 5 $ 773 Accounts payable to affiliates 3,667 645 1,499 (5,760) 51 Accrued liabilities 87 787 420 (826) 468 Note payable to affiliate 100 — — — 100 Current portion of debt 30 — 20 — 50 Current liabilities held for sale — — 467 — 467 Total current liabilities 3,947 1,584 2,959 (6,581) 1,909 Long-term debt 3,763 — 359 — 4,122 Notes payable to affiliates 696 — 658 (657) 697 Deferred income taxes 22 257 19 69 367 Other noncurrent liabilities 174 300 577 — 1,051 Noncurrent liabilities held for sale — — 393 — 393 Total liabilities 8,602 2,141 4,965 (7,169) 8,539 Equity Huntsman International LLC members’ equity Members’ equity 3,226 2,949 5,019 (7,968) 3,226 Accumulated (deficit) income (779) 2,332 (1,713) (619) (779) Accumulated other comprehensive (loss) income (1,691) 998 (1,652) 654 (1,691) Total Huntsman International LLC members' equity 756 6,279 1,654 (7,933) 756 Noncontrolling interests in subsidiaries — — 169 11 180 Total equity 756 6,279 1,823 (7,922) 936 Total liabilities and equity $ 9,358 $ 8,420 $ 6,788 $ (15,091) $ 9,475 HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME THREE MONTHS ENDED SEPTEMBER 30, 2017 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Revenues: Trade sales, services and fees, net $ 296 $ 498 $ 1,343 $ — $ 2,137 Related party sales 55 75 255 (353) 32 Total revenues 351 573 1,598 (353) 2,169 Cost of goods sold 275 520 1,251 (352) 1,694 Gross profit 76 53 347 (1) 475 Selling, general and administrative 34 31 132 — 197 Research and development 12 11 12 — 35 Restructuring, impairment and plant closing (credits) costs (3) 1 3 — 1 Merger costs 12 — — — 12 Other operating expense (income), net 20 (8) (7) — 5 Operating income 1 18 207 (1) 225 Interest (expense) income (43) 7 (8) — (44) Equity in income of investment in affiliates and subsidiaries 187 180 1 (367) 1 Loss on early extinguishment of debt (35) — — — (35) Dividend income (expense) 1 — (1) — — Other income, net (1) 2 1 — 2 Income from continuing operations before income taxes 110 207 200 (368) 149 Income tax benefit (expense) 26 (11) (49) — (34) Income from continuing operations 136 196 151 (368) 115 Income (loss) from discontinued operations, net of tax 9 (1) 54 — 62 Net income 145 195 205 (368) 177 Net income attributable to noncontrolling interests — — (32) — (32) Net income attributable to Huntsman International LLC $ 145 $ 195 $ 173 $ (368) $ 145 Net income $ 145 $ 195 $ 205 $ (368) $ 177 Other comprehensive income 171 329 113 (509) 104 Comprehensive income attributable to noncontrolling interests — — (36) (1) (37) Comprehensive income attributable to Huntsman International LLC $ 316 $ 524 $ 282 $ (878) $ 244 HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME THREE MONTHS ENDED SEPTEMBER 30, 2016 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Revenues: Trade sales, services and fees, net $ 264 $ 424 $ 1,114 $ — $ 1,802 Related party sales 45 64 231 (311) 29 Total revenues 309 488 1,345 (311) 1,831 Cost of goods sold 249 434 1,101 (310) 1,474 Gross profit 60 54 244 (1) 357 Selling, general and administrative 33 25 126 — 184 Research and development 13 11 10 — 34 Restructuring, impairment and plant closing costs 2 6 30 — 38 Other operating income, net 3 (8) 3 — (2) Operating income 9 20 75 (1) 103 Interest (expense) income (54) 7 (8) — (55) Equity in (loss) income of investment in affiliates and subsidiaries 82 80 2 (163) 1 Loss on early extinguishment of debt (1) — — — (1) Dividend income (expense) 1 — (2) 1 — Other (loss) income, net (3) — 3 — — Income from continuing operations before income taxes 34 107 70 (163) 48 Income tax benefit (expense) 20 (13) (14) — (7) Income from continuing operations 54 94 56 (163) 41 Loss from discontinued operations, net of tax — — 22 — 22 Net income 54 94 78 (163) 63 Net income attributable to noncontrolling interests — — (9) — (9) Net income attributable to Huntsman International LLC $ 54 $ 94 $ 69 $ (163) $ 54 Net income $ 54 $ 94 $ 78 $ (163) $ 63 Other comprehensive income 32 7 31 (38) 32 Comprehensive income attributable to noncontrolling interests — — (6) (3) (9) Comprehensive income attributable to Huntsman International LLC $ 86 $ 101 $ 103 $ (204) $ 86 HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME NINE MONTHS ENDED SEPTEMBER 30, 2017 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Revenues: Trade sales, services and fees, net $ 824 $ 1,543 $ 3,681 $ — $ 6,048 Related party sales 169 248 772 (1,082) 107 Total revenues 993 1,791 4,453 (1,082) 6,155 Cost of goods sold 792 1,551 3,585 (1,079) 4,849 Gross profit 201 240 868 (3) 1,306 Selling, general and administrative 129 94 356 — 579 Research and development 35 31 37 — 103 Restructuring, impairment and plant closing costs 1 — 12 — 13 Merger costs 18 — — — 18 Other operating expense (income), net 36 (33) (12) — (9) Operating (expense) income (18) 148 475 (3) 602 Interest (expense) income (143) 20 (23) — (146) Equity in income of investment in affiliates and subsidiaries 534 453 5 (988) 4 Loss on early extinguishment of debt (36) — — — (36) Dividend income 1 — — (1) — Other income, net (1) 2 4 — 5 Income from continuing operations before income taxes 337 623 461 (992) 429 Income tax benefit (expense) 56 (58) (75) — (77) Income from continuing operations 393 565 386 (992) 352 (Loss) income from discontinued operations, net of tax (7) (2) 107 — 98 Net income 386 563 493 (992) 450 Net income attributable to noncontrolling interests — — (64) — (64) Net income attributable to Huntsman International LLC $ 386 $ 563 $ 429 $ (992) $ 386 Net income $ 386 $ 563 $ 493 $ (992) $ 450 Other comprehensive income 337 479 289 (828) 277 Comprehensive income attributable to noncontrolling interests — — (70) (6) (76) Comprehensive income attributable to Huntsman International LLC $ 723 $ 1,042 $ 712 $ (1,826) $ 651 HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME NINE MONTHS ENDED SEPTEMBER 30, 2016 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Revenues: Trade sales, services and fees, net $ 787 $ 1,396 $ 3,336 $ — $ 5,519 Related party sales 139 222 700 (966) 95 Total revenues 926 1,618 4,036 (966) 5,614 Cost of goods sold 726 1,343 3,339 (967) 4,441 Gross profit 200 275 697 1 1,173 Selling, general and administrative 117 79 365 — 561 Research and development 35 32 36 — 103 Restructuring, impairment and plant closing costs 5 15 36 — 56 Other operating expense (income), net 11 (28) 14 — (3) Operating income 32 177 246 1 456 Interest (expense) income (165) 24 (21) — (162) Equity in income of investment in affiliates and subsidiaries 67 183 6 (252) 4 Loss on early extinguishment of debt (3) — — — (3) Dividend income (expense) 217 (430) 430 (217) — Other (loss) income , net (3) — 8 — 5 Income (loss) from continuing operations before income taxes 145 (46) 669 (468) 300 Income tax benefit (expense) 50 (71) (44) — (65) Income (loss) from continuing operations 195 (117) 625 (468) 235 Income (loss) from discontinued operations, net of tax 1 (1) (17) — (17) Net income (loss) 196 (118) 608 (468) 218 Net income attributable to noncontrolling interests — — (19) (3) (22) Net income (loss) attributable to Huntsman International LLC $ 196 $ (118) $ 589 $ (471) $ 196 Net income (loss) $ 196 $ (118) $ 608 $ (468) $ 218 Other comprehensive income 27 86 32 (118) 27 Comprehensive income attributable to noncontrolling interests — — (11) (11) (22) Comprehensive income (loss) attributable to Huntsman International LLC $ 223 $ (32) $ 629 $ (597) $ 223 HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2017 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Net cash provided by (used in) operating activities from continuing operations $ 274 $ 514 $ (252) $ — $ 536 Net cash (used in) provided by operating activities from discontinued operations (19) — 221 — 202 Net cash provided by (used in) operating activities 255 514 (31) — 738 Investing activities: Capital expenditures (26) (37) (96) — (159) Cash received from consolidated affiliates 800 — (278) (522) — Acquisition of business, net of cash acquired — — (14) — (14) Proceeds from sale of businesses/assets — — 21 — 21 Increase in receivable from affiliate (3) — — — (3) Cash received from termination of cross-currency interest rate contracts 7 — — — 7 Other, net 1 — — — 1 Net cash provided by (used in) investing activities from continuing operations 779 (37) (367) (522) (147) Net cash used in investing activities from discontinued operations — — (49) — (49) Net cash provided by (used in) investing activities 779 (37) (416) (522) (196) Financing activities: Net repayments under revolving loan facilities — — (36) — (36) Repayments of short-term debt — — (10) — (10) Borrowings on short-term debt — — 6 — 6 Repayments of long-term debt (1,416) — (23) — (1,439) Proceeds from long-term debt of P&A Business — — 750 — 750 Proceeds from issuance of long-term debt — — 24 — 24 Proceeds from issuance of notes payable from affiliate 21 — — — 21 Repayments of notes payable (20) — — — (20) Borrowings on notes payable 11 — — — 11 Debt issuance costs paid (3) — (18) — (21) Dividends paid to noncontrolling interests — — (26) — (26) Contribution from noncontrolling interests — — 4 — 4 Distribution to parent — (477) (45) 522 — Dividends paid to parent (90) — — — (90) Proceeds from the IPO of P&A Business 522 — — — 522 Cash paid for the expenses of the IPO of P&A Business (40) — — — (40) Other, net — — 1 — 1 Net cash (used in) provided by financing activities (1,015) (477) 627 522 (343) Effect of exchange rate changes on cash — — 12 — 12 Increase in cash and cash equivalents 19 — 192 — 211 Cash and cash equivalents from continuing operations at beginning of period 37 — 347 — 384 Cash and cash equivalents from discontinued operations at beginning of period — — 29 — 29 Cash and cash equivalents at end of period $ 56 $ — $ 568 $ — $ 624 During the nine months ended September 30, 2017, we made a noncash capital contribution of approximately $50 million between Parent Company and Guarantor entities. HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2016 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Net cash provided by operating activities from continuing operations $ 410 $ 87 $ 239 $ — $ 736 Net cash provided by operating activities from discontinued operations — — 107 — 107 Net cash provided by operating activities 410 87 346 — 843 Investing activities: Capital expenditures (24) (66) (124) — (214) Investment in affiliate (11) (3) (2) 14 (2) Decrease in receivable in affiliate 3 — — — 3 Change in restricted cash — — 1 — 1 Other, net — 1 1 — 2 Net cash used in investing activities from continuing operations (32) (68) (124) 14 (210) Net cash used in investing activities from discontinued operations — — (57) — (57) Net cash used in investing activities (32) (68) (181) 14 (267) Financing activities: Net repayments on overdraft facilities $ — $ (1) $ — $ — $ (1) Repayments of short-term debt — — (41) — (41) Borrowings on short-term debt — — 8 — 8 Repayments of long-term debt (774) — (21) — (795) Proceeds from issuance of long-term debt 547 — 5 — 552 Repayments of notes payable to affiliate (7) — — 6 (1) Proceeds of notes payable to affiliate — — 6 (6) — Repayments of notes payable (23) — (2) — (25) Borrowings on notes payable 30 — 1 — 31 Debt issuance costs paid (8) — — — (8) Dividends paid to noncontrolling interests — — (26) — (26) Contribution from parent — 3 31 (34) — Distribution to parent — (20) — 20 — Dividends paid to parent (89) (1) — — (90) Other, net 1 — — — 1 Net cash used in financing activities (323) (19) (39) (14) (395) Effect of exchange rate changes on cash from continuing operations — — 1 — 1 Increase in cash and cash equivalents 55 — 127 — 182 Cash and cash equivalents from continuing operations at beginning of period 44 — 192 — 236 Cash and cash equivalents from discontinued operations at beginning of period — — 21 — 21 Cash and cash equivalents at end of period $ 99 $ — $ 340 $ — $ 439 During the nine months ended September 30, 2016, we made a noncash capital contribution of approximately $215 million between Parent Company and certain Nonguarantors. |
GENERAL (Policies)
GENERAL (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
GENERAL | |
PRINCIPLES OF CONSOLIDATION | PRINCIPLES OF CONSOLIDATION Our condensed 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. Intercompany accounts and transactions have been eliminated. |
RECLASSIFICATIONS | 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 as held for sale and results of operations of the former P&A Business to discontinued operations. See “Note 4. Discontinued Operations.” In connection with the separation of the P&A Business, certain entities were removed from the debt guarantor structure. The unaudited condensed consolidated financial information included in “Note 19. Condensed Consolidating Financial Information of Huntsman International LLC” has been presented as if the new debt guarantor structure existed for all periods presented. |
USE OF ESTIMATES | USE OF ESTIMATES The preparation of financial statements in conformity with U.S. 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. |
INVENTORIES (Tables)
INVENTORIES (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
INVENTORIES | |
Schedule of components of inventory | Inventories consisted of the following (dollars in millions): September 30, December 31, 2017 2016 Raw materials and supplies $ 218 $ 157 Work in progress 54 45 Finished goods 867 771 Total 1,139 973 LIFO reserves (55) (55) Net inventories $ 1,084 $ 918 |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
DISCONTINUED OPERATIONS | |
Summarizes the financial data for discontinued operations | September 30, December 31, 2017 2016 Carrying amounts of major classes of assets held for sale: Accounts receivable $ 411 $ 234 Inventories 432 426 Other current assets 280 117 Total current assets(1) 777 Property, plant and equipment, net 1,290 1,178 Deferred income taxes 195 143 Other noncurrent assets 137 142 Total noncurrent assets(1) 1,463 Total assets held for sale $ 2,745 $ 2,240 Carrying amounts of major classes of liabilities in held for sale: Accounts payable $ 319 $ 297 Accrued liabilities 213 145 Other current liabilities 16 25 Total current liabilities(1) 467 Deferred income taxes — 56 Long term debt 747 — Other noncurrent liabilities 338 337 Total noncurrent liabilities(1) 393 Total liabilities held for sale $ 1,633 $ 860 (1) The assets and liabilities held for sale are classified as current as of September 30, 2017 because it is probable that the sale of the remaining 75% interest in Venator ordinary shares will occur and proceeds will be collected within one year. The following table summarizes major classes of line items constituting pretax and after-tax income of discontinued operations: Huntsman Corporation Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Major classes of line items constituting pretax income (loss) of discontinued operations: Trade sales, services and fees, net $ 589 $ 540 $ 1,700 $ 1,670 Cost of goods sold 470 496 1,421 1,566 Selling, general and administrative 54 42 128 131 Restructuring, impairment and plant closing costs 17 8 51 32 Business separation expenses 11 — 32 — Other operating income, net (51) (23) (83) (37) Other loss (income), net 8 — 9 (2) Income (loss) from discontinued operations before income taxes 80 17 142 (20) Income tax (expense) benefit (17) 7 (41) 8 Income (loss) from discontinued operations, net of tax 63 24 101 (12) Net income attributable to noncontrolling interests (2) (3) (8) (8) Net income (loss) attributable to discontinued operations $ 61 $ 21 $ 93 $ (20) Huntsman International Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Major classes of line items constituting pretax income (loss) of discontinued operations: Trade sales, services and fees, net $ 589 $ 540 $ 1,700 $ 1,670 Cost of goods sold 471 498 1,424 1,571 Selling, general and administrative 54 42 128 131 Restructuring, impairment and plant closing costs 17 8 51 32 Business separation expenses 11 — 32 — Other operating income, net (51) (23) (83) (37) Other loss (income), net 8 — 9 (2) Income (loss) from discontinued operations before income taxes 79 15 139 (25) Income tax (expense) benefit (17) 7 (41) 8 Income (loss) from discontinued operations, net of tax 62 22 98 (17) Net income attributable to noncontrolling interests (2) (3) (8) (8) Net income (loss) attributable to discontinued operations $ 60 $ 19 $ 90 $ (25) |
VARIABLE INTEREST ENTITIES (Tab
VARIABLE INTEREST ENTITIES (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
VARIABLE INTEREST ENTITIES | |
Schedule of financial information of VIE's | The following table summarizes the carrying amount of our variable interest entities’ assets and liabilities included in our condensed consolidated balance sheets as of September 30, 2017 and our consolidated balance sheets as of December 31, 2016 (dollars in millions): September 30, December 31, 2017 2016 Current assets $ 124 $ 103 Property, plant and equipment, net 272 279 Other noncurrent assets 107 99 Deferred income taxes 43 43 Intangible assets 10 10 Goodwill 14 12 Total assets $ 570 $ 546 Current liabilities $ 131 $ 131 Long-term debt 94 114 Deferred income taxes 11 10 Other noncurrent liabilities 80 76 Total liabilities $ 316 $ 331 The revenues, income from continuing operations before income taxes and net cash provided by operating activities for our variable interest entities for the three and nine months ended September 30, 2017 and 2016 are as follows (dollars in millions): Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Revenues $ 32 $ 24 $ 99 $ 72 Income from continuing operations before income taxes 8 2 22 12 Net cash provided by operating activities 20 13 42 37 |
RESTRUCTURING, IMPAIRMENT AND32
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS | |
Schedule of accrued restructuring, impairment and plant closing costs by type of cost and initiative | As of September 30, 2017 and December 31, 2016, accrued restructuring costs of continuing operations by type of cost and initiative consisted of the following (dollars in millions): Non-cancelable Other Workforce Demolition and lease and contract restructuring reductions(1) decommissioning termination costs costs Total(2) Accrued liabilities as of January 1, 2017 $ 4 $ 19 $ 40 $ 5 $ 68 2017 charges for 2016 and prior initiatives — 5 1 1 7 2017 charges for 2017 initiatives 6 — — — 6 2017 payments for 2016 and prior initiatives — (21) (1) (2) (24) 2017 payments for 2017 initiatives (2) — — — (2) Foreign currency effect on liability balance 1 1 2 — 4 Accrued liabilities as of September 30, 2017 $ 9 $ 4 $ 42 $ 4 $ 59 (1) The workforce reduction reserves relate to the termination of 163 positions, of which 116 positions had not been terminated as of September 30, 2017. (2) Accrued liabilities by initiatives were as follows (dollars in millions): September 30, December 31, 2017 2016 2015 and prior initiatives $ 55 $ 67 2016 initiatives — 1 2017 initiatives 4 — Total $ 59 $ 68 |
Schedule of accrued liabilities by year of initiatives | September 30, December 31, 2017 2016 2015 and prior initiatives $ 55 $ 67 2016 initiatives — 1 2017 initiatives 4 — Total $ 59 $ 68 |
Schedule of details with respect to reserves for restructuring, impairment and plant closing costs, provided by segment and initiative | Details with respect to our reserves for restructuring, impairment and plant closing costs are provided below by segment and initiative (dollars in millions): Performance Advanced Textile Corporate Polyurethanes Products Materials Effects and other Total Accrued liabilities as of January 1, 2017 $ 2 $ — $ 3 $ 61 $ 2 $ 68 2017 charges for 2016 and prior initiatives — — — 7 — 7 2017 charges for 2017 initiatives — — — 6 — 6 2017 payments for 2016 and prior initiatives (1) — — (23) — (24) 2017 payments for 2017 initiatives — — — (2) — (2) Foreign currency effect on liability balance — — — 4 — 4 Accrued liabilities as of September 30, 2017 $ 1 $ — $ 3 53 $ 2 $ 59 Current portion of restructuring reserves $ 1 $ — $ 2 $ 14 $ 2 $ 19 Long-term portion of restructuring reserves — — 1 39 — 40 |
Schedule of cash and noncash restructuring charges by initiative | Details with respect to cash and noncash restructuring charges from continuing operations for the three and nine months ended September 30, 2017 and 2016 by initiative are provided below (dollars in millions): Three months ended September 30, 2017 Nine months ended September 30, 2017 Cash charges: 2017 charges for 2016 and prior initiatives $ 2 $ 7 2017 charges for 2017 initiatives — 6 Pension-related charges — 1 Accelerated depreciation — 2 Gain on sale of land (1) (3) Total 2017 Restructuring, Impairment and Plant Closing Costs $ 1 $ 13 Three months ended September 30, 2016 Nine months ended September 30, 2016 Cash charges: 2016 charges for 2015 and prior initiatives $ 40 $ 56 2016 charges for 2016 initiatives 1 4 Gain on sale of land (3) (3) Reversal of reserves no longer required — (1) Total 2016 Restructuring, Impairment and Plant Closing Costs $ 38 $ 56 |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Debt | |
Schedule of outstanding debt | September 30, December 31, 2017 2016 Senior Credit Facilities: Term loans $ 592 $ 1,967 Amounts outstanding under A/R programs 184 208 Senior notes 1,913 1,812 Variable interest entities 114 126 Other 71 59 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Total current portion of debt $ 29 $ 50 Long-term portion 2,845 4,122 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Notes payable to affiliates-noncurrent — 1 Total debt $ 2,874 $ 4,173 |
Huntsman International | |
Debt | |
Schedule of outstanding debt | September 30, December 31, 2017 2016 Senior Credit Facilities: Term loans $ 592 $ 1,967 Amounts outstanding under A/R programs 184 208 Senior notes 1,913 1,812 Variable interest entities 114 126 Other 71 59 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Total current portion of debt $ 29 $ 50 Long-term portion 2,845 4,122 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Total debt—excluding debt to affiliates $ 2,874 $ 4,172 Notes payable to affiliates-current 100 100 Notes payable to affiliates-noncurrent 717 697 Total debt $ 3,691 $ 4,969 |
Schedule of Senior Credit Facilities | As of September 30, 2017, our Senior Credit Facilities consisted of our revolving facility (“Revolving Facility”) and our 2023 Term Loan B as follows (dollars in millions): Unamortized Discounts and Committed Principal Debt Issuance Carrying Facility Amount Outstanding Costs Value Interest Rate(3) Maturity Revolving Facility $ 650 $ — $ — $ — USD LIBOR plus 2.50% 2023 Term Loan B N/A 611 (19) 592 USD LIBOR plus 3.00%(2) (1) We had no borrowings outstanding under our Revolving Facility; we had approximately $8 million (U.S. dollar equivalents) of letters of credit and bank guarantees issued and outstanding under our Revolving Facility. (2) The 2023 Term Loan B is subject to a 0.75% LIBOR floor. (3) The applicable interest rate of the Revolving Facility is subject to certain secured leverage ratio thresholds. As of September 30, 2017, the weighted average interest rate on our outstanding balances under the Senior Credit Facilities was approximately 4%. |
Schedule of A/R Programs | Information regarding our A/R Programs as of September 30, 2017 was as follows (monetary amounts in millions): Maximum Funding Amount Facility Maturity Availability(1) Outstanding Interest Rate(2) U.S. A/R Program April 2020 $ 250 $ 90 (3) Applicable rate plus 0.95% EU A/R Program April 2020 € 150 € 80 Applicable rate plus 1.30% (approximately $176) (approximately $94) (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 either USD LIBOR or CP rate. The applicable rate for our EU A/R Program is either GBP LIBOR, USD LIBOR or EURIBOR. In addition, the U.S. SPE and the EU SPE are obligated to pay unused commitment fees to the lenders based on the amount of each lender’s commitment. (3) As of September 30, 2017, we had approximately $7 million (U.S. dollar equivalents) of letters of credit issued and outstanding under our U.S. A/R Program. |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
FAIR VALUE | |
Schedule of fair values of financial instruments | The fair values of financial instruments were as follows (dollars in millions): September 30, 2017 December 31, 2016 Carrying Estimated Carrying Estimated Value Fair Value Value Fair Value Non-qualified employee benefit plan investments $ 30 $ 30 $ 27 $ 27 Investments in equity securities 3 3 18 18 Cross-currency interest rate contracts — — 29 29 Interest rate contracts (1) (1) (2) (2) Long-term debt (including current portion) (2,874) (3,098) (4,172) (4,345) |
Schedule of assets and liabilities are measured at fair value on a recurring basis | 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 in active markets observable unobservable September 30, for identical inputs inputs Description 2017 assets (Level 1)(3) (Level 2)(3) (Level 3) Assets: Available-for sale equity securities: Non-qualified employee benefit plan investments $ 30 $ 30 $ — $ — Investments in equity securities 3 3 — — Derivatives: Cross-currency interest rate contracts(1) — — — — Total assets $ 33 $ 33 $ — $ — Liabilities: Derivatives: Interest rate contracts(2) $ (1) $ — $ (1) $ — Fair Value Amounts Using Quoted prices Significant other Significant in active markets observable unobservable December 31, for identical inputs inputs Description 2016 assets (Level 1)(3) (Level 2)(3) (Level 3) Assets: Available-for sale equity securities: Non-qualified employee benefit plan investments $ 27 $ 27 $ — $ — Investments in equity securities 18 18 — — Derivatives: Cross-currency interest rate contracts(1) 29 — — 29 Total assets $ 74 $ 45 $ — $ 29 Liabilities: Derivatives: Interest rate contracts(2) $ (2) $ — $ (2) $ — (1) The income approach is used to calculate the fair value of these instruments. Fair value represents the present value of estimated future cash flows, calculated using relevant interest rates, exchange rates, and yield curves at stated intervals. There were no material changes to the valuation methods or assumptions used to determine the fair value during the current period. In November 2014, we entered into two five year cross-currency interest rate contracts and one eight year cross-currency interest rate contract. These instruments had been categorized by us as Level 3 within the fair value hierarchy due to unobservable inputs associated with the credit valuation adjustment, which we deemed to be significant inputs to the overall measurement of fair value at inception. In August 2017, we terminated these cross-currency interest rate contracts and received $7 million in payments from the counterparties. (2) The income approach is used to calculate the fair value of these instruments. Fair value represents the present value of estimated future cash flows, calculated using relevant interest rates and yield curves at stated intervals. There were no material changes to the valuation methods or assumptions used to determine the fair value during the current period. (3) There were no transfers between Levels 1 and 2 within the fair value hierarchy during the nine months ended September 30, 2017 and the year ended December 31, 2016. |
Schedule of reconciliation of beginning and ending balances for instruments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) | The following table shows a reconciliation of beginning and ending balances for the three and nine months ended September 30, 2017 and 2016 for instruments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (dollars in millions). Three months Nine months ended ended September 30, 2017 September 30, 2017 Cross-Currency Cross-Currency Interest Interest Rate Contracts Rate Contracts Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Beginning balance $ 16 $ 29 Transfers into Level 3 — — Transfers out of Level 3 — — Total (losses) gains: Included in earnings — — Included in other comprehensive income (loss) (9) (22) Purchases, sales, issuances and settlements (7) (7) Ending balance, September 30, 2017 $ — $ — The amount of total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets still held at September 30, 2017 $ — $ — Three months Nine months ended ended September 30, 2016 September 30, 2016 Cross-Currency Cross-Currency Interest Interest Rate Contracts Rate Contracts Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Beginning balance $ 26 $ 28 Transfers into Level 3 — — Transfers out of Level 3 — — Total (losses) gains: Included in earnings — — Included in other comprehensive income (loss) (5) (7) Purchases, sales, issuances and settlements — — Ending balance, September 30, 2016 $ 21 $ 21 The amount of total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets still held at September 30, 2016 $ — $ — |
Schedule of gains and losses (realized and unrealized) included in earnings reported in interest expense and other comprehensive income (loss) | Gains and losses (realized and unrealized) included in earnings for instruments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) are reported in interest expense and other comprehensive income (loss) as follows (dollars in millions): Three months Nine months ended ended September 30, 2017 September 30, 2017 Other Other Interest comprehensive Interest comprehensive 2017 expense income (loss) expense income (loss) Total net gains included in earnings $ — $ — $ — $ — Changes in unrealized losses — (9) — (22) Three months Nine months ended ended September 30, 2016 September 30, 2016 Other Other Interest comprehensive Interest comprehensive 2016 expense income (loss) expense income (loss) Total net gains included in earnings $ — $ — $ — $ — Changes in unrealized losses relating to assets still held at September 30, 2016 — (5) — (7) |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
EMPLOYEE BENEFIT PLANS | |
Components of the net periodic benefit costs | Other Postretirement Defined Benefit Plans Benefit Plans Three months Three months ended ended September 30, September 30, 2017 2016 2017 2016 Service cost $ 16 $ 15 $ 1 $ 1 Interest cost 20 22 1 1 Expected return on assets (39) (37) — — Amortization of prior service benefit (2) (2) (2) (2) Amortization of actuarial loss 19 15 1 — Net periodic benefit cost $ 14 $ 13 $ 1 $ — Other Postretirement Defined Benefit Plans Benefit Plans Nine months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Service cost $ 47 $ 44 $ 2 $ 2 Interest cost 59 67 3 3 Expected return on assets (116) (111) — — Amortization of prior service benefit (5) (7) (5) (5) Amortization of actuarial loss 56 43 2 1 Special termination benefits 1 — — — Net periodic benefit cost $ 42 $ 36 $ 2 $ 1 |
Huntsman International | |
EMPLOYEE BENEFIT PLANS | |
Components of the net periodic benefit costs | Other Postretirement Defined Benefit Plans Benefit Plans Three months Three months ended ended September 30, September 30, 2017 2016 2017 2016 Service cost $ 16 $ 15 $ 1 $ 1 Interest cost 20 22 1 1 Expected return on assets (39) (37) — — Amortization of prior service benefit (2) (2) (2) (2) Amortization of actuarial loss 20 16 1 — Net periodic benefit cost $ 15 $ 14 $ 1 $ — Other Postretirement Defined Benefit Plans Benefit Plans Nine months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Service cost $ 47 $ 44 $ 2 $ 2 Interest cost 59 67 3 3 Expected return on assets (116) (111) — — Amortization of prior service benefit (5) (7) (5) (5) Amortization of actuarial loss 58 45 2 1 Special termination benefits 1 — — — Net periodic benefit cost $ 44 $ 38 $ 2 $ 1 |
OTHER COMPREHENSIVE INCOME (L36
OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
OTHER COMPREHENSIVE INCOME (LOSS) | |
Schedule of other comprehensive loss | The components of other comprehensive income (loss) and changes in accumulated other comprehensive loss by component were as follows (dollars in millions): Huntsman Corporation Pension and Other Foreign other comprehensive Amounts Amounts currency postretirement income of attributable to attributable to translation benefits unconsolidated noncontrolling Huntsman adjustment(a) adjustments(b) affiliates Other, net Total interests Corporation Beginning balance, January 1, 2017 $ (459) $ (1,275) $ 4 $ 23 $ (1,707) $ 36 $ (1,671) Other comprehensive income before reclassifications, gross 170 — (1) 7 176 (12) 164 Tax benefit 31 — — (1) 30 — 30 Amounts reclassified from accumulated other comprehensive loss, gross(c) — 60 — (8) 52 — 52 Tax expense — (5) — — (5) — (5) Net current-period other comprehensive income (loss) 201 55 (1) (2) 253 (12) 241 Disposition of a portion of P&A Business — — — — — 72 72 Ending balance, September 30, 2017 $ (258) $ (1,220) $ 3 $ 21 $ (1,454) $ 96 $ (1,358) (a) Amounts are net of tax of $69 and $100 as of September 30, 2017 and January 1, 2017, respectively. (b) Amounts are net of tax of $172 and $177 as of September 30, 2017 and January 1, 2017, respectively. (c) See table below for details about these reclassifications. Pension and Other Foreign other comprehensive Amounts Amounts currency postretirement income of attributable to attributable to translation benefits unconsolidated noncontrolling Huntsman adjustment(a) adjustments(b) affiliates Other, net Total interests Corporation Beginning balance, January 1, 2016 $ (288) $ (1,056) $ 11 $ 17 $ (1,316) $ 28 $ (1,288) Other comprehensive (loss) income before reclassifications, gross (18) — (8) 6 (20) — (20) Tax benefit 7 — — — 7 — 7 Amounts reclassified from accumulated other comprehensive loss, gross(c) — 40 — — 40 — 40 Tax expense — (5) — — (5) — (5) Net current-period other comprehensive (loss) income (11) 35 (8) 6 22 — 22 Ending balance, September 30, 2016 $ (299) $ (1,021) $ 3 $ 23 $ (1,294) $ 28 $ (1,266) (a) (b) (c) |
Schedule of details about reclassifications from other comprehensive loss | Three months ended Nine months ended September 30, 2017 September 30, 2017 Amount reclassified Amount reclassified Affected line item in from accumulated from accumulated the statement Details about Accumulated Other other other where net income Comprehensive Loss Components(a): comprehensive loss comprehensive loss is presented Amortization of pension and other postretirement benefits: Prior service credit $ (4) $ (11) (b) Actuarial loss 25 71 (b)(c) 21 60 Total before tax (3) (5) Income tax expense Total reclassifications for the period $ 18 $ 55 Net of tax Three months ended Nine months ended September 30, 2016 September 30, 2016 Amount reclassified Amount reclassified Affected line item in from accumulated from accumulated the statement Details about Accumulated Other other other where net income Comprehensive Loss Components(a): comprehensive loss comprehensive loss is presented Amortization of pension and other postretirement benefits: Prior service credit $ (4) $ (12) (b) Actuarial loss 17 52 (b)(c) 13 40 Total before tax (2) (5) Income tax expense Total reclassifications for the period $ 11 $ 35 Net of tax (a) Pension and other postretirement benefits amounts in parentheses indicate credits on our condensed consolidated statements of operations. (b) These accumulated other comprehensive loss components are included in the computation of net periodic pension costs. See “Note 10. Employee Benefit Plans.” (c) Amounts contain approximately $6 and $4 of actuarial losses related to discontinued operations for the three months ended September 30, 2017 and 2016, respectively and $18 and $11 of actuarial losses related to discontinued operations for the nine months ended September 30, 2017 and 2016, respectively. |
Huntsman International | |
OTHER COMPREHENSIVE INCOME (LOSS) | |
Schedule of other comprehensive loss | Foreign Pension Other Other, net Total Amounts Amounts Beginning balance, January 1, 2017 $ (462) $ (1,286) $ 4 $ 17 $ (1,727) $ 36 $ (1,691) Other comprehensive income before reclassifications, gross 169 — (1) 8 176 (12) 164 Tax benefit 30 — — (1) 29 — 29 Amounts reclassified from accumulated other comprehensive loss, gross(c) — 65 — (8) 57 — 57 Contribution of other comprehensive income from Parent — 20 — — 20 — 20 Tax expense — (5) — — (5) — (5) Net current-period other comprehensive income (loss) 199 80 (1) (1) 277 (12) 265 Disposition of a portion of P&A Business — — — — — 72 72 Ending balance, September 30, 2017 $ (263) $ (1,206) $ 3 $ 16 $ (1,450) $ 96 $ (1,354) (a) Amounts are net of tax of $56 and $86 as of September 30, 2017 and January 1, 2017, respectively. (b) Amounts are net of tax of $200 and $205 as of September 30, 2017 and January 1, 2017, respectively. (c) See table below for details about these reclassifications. Foreign Pension Other Other, net Total Amounts Amounts Beginning balance, January 1, 2016 $ (292) $ (1,074) $ 11 $ 11 $ (1,344) $ 28 $ (1,316) Other comprehensive (loss) income before reclassifications, gross (18) — (8) 6 (20) — (20) Tax benefit 7 — — — 7 — 7 Amounts reclassified from accumulated other comprehensive loss, gross(c) — 46 — — 46 — 46 Tax expense — (6) — — (6) — (6) Net current-period other comprehensive income (loss) (11) 40 (8) 6 27 — 27 Ending balance, September 30, 2016 $ (303) $ (1,034) $ 3 $ 17 $ (1,317) $ 28 $ (1,289) (a) Amounts are net of tax of $69 and $76 as of September 30, 2016 and January 1, 2016, respectively. (b) Amounts are net of tax of $157 and $163 as of both September 30, 2016 and January 1, 2016, respectively. (c) See table below for details about these reclassifications. |
Schedule of details about reclassifications from other comprehensive loss | Three months ended Nine months ended September 30, 2017 September 30, 2017 Amount reclassified Amount reclassified Affected line item in from accumulated from accumulated the statement Details about Accumulated Other other other where net income Comprehensive Loss Components(a): comprehensive loss comprehensive loss is presented Amortization of pension and other postretirement benefits: Prior service credit $ (4) $ (11) (b) Actuarial loss 26 76 (b)(c) 22 65 Total before tax (3) (5) Income tax expense Total reclassifications for the period $ 19 $ 60 Net of tax Three months ended Nine months ended September 30, 2016 September 30, 2016 Amount reclassified Amount reclassified Affected line item in from accumulated from accumulated the statement Details about Accumulated Other other other where net income Comprehensive Loss Components(a): comprehensive loss comprehensive loss is presented Amortization of pension and other postretirement benefits: Prior service credit $ (4) $ (12) (b) Actuarial loss 20 58 (b)(c) 16 46 Total before tax (2) (6) Income tax expense Total reclassifications for the period $ 14 $ 40 Net of tax (a) Pension and other postretirement benefits amounts in parentheses indicate credits on our condensed consolidated statements of operations. (b) These accumulated other comprehensive loss components are included in the computation of net periodic pension costs. See “Note 10. Employee Benefit Plans.” (c) Amounts contain approximately $6 and $4 of actuarial losses related to discontinued operations for the three months ended September 30, 2017 and 2016, respectively and $18 and $11 of actuarial losses related to discontinued operations for the nine months ended September 30, 2017 and 2016, respectively. |
STOCK-BASED COMPENSATION PLAN (
STOCK-BASED COMPENSATION PLAN (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
STOCK-BASED COMPENSATION PLAN | |
Schedule of compensation cost from continuing operations under the Stock Incentive Plan | The compensation cost from continuing operations under the 2016 Stock Incentive Plan and the Prior Plan for our Company and Huntsman International were as follows (dollars in millions): Three months ended Nine months ended ended ended September 30, September 30, 2017 2016 2017 2016 Huntsman Corporation compensation cost $ 8 $ 7 $ 25 $ 23 Huntsman International compensation cost 8 7 24 22 |
Schedule of assumptions used to calculate fair value of each stock option award estimated on the date of grant using the Black-Scholes valuation model | Three months ended Nine months ended ended ended September 30, September 30, 2017 2016 2017 2016 Dividend yield NA 3.3 % 2.4 % 5.6 % Expected volatility NA 57.6 % 56.9 % 57.9 % Risk-free interest rate NA 1.1 % 2.0 % 1.4 % Expected life of stock options granted during the period NA 5.9 years 5.9 years 5.9 years During the three months ended September 30, 2017, no stock options were granted. |
Summary of stock option activity under the Stock Incentive Plan | Weighted Weighted Average Average Remaining Aggregate Exercise Contractual Intrinsic Option Awards Shares Price Term Value (in thousands) (years) (in millions) Outstanding at January 1, 2017 11,245 $ 13.37 Granted 997 21.04 Exercised (2,118) 17.59 Forfeited (59) 17.39 Converted to Venator awards (417) 5.00 Outstanding at September 30, 2017 9,648 13.17 5.7 $ 137 Exercisable at September 30, 2017 6,822 12.88 4.6 99 |
Summary of status of nonvested shares | Equity Awards Liability Awards Weighted Weighted Average Average Grant- Date Grant-Date Shares Fair Value Shares Fair Value (in thousands) (in thousands) Nonvested at January 1, 2017 2,996 $ 13.36 912 $ 12.27 Granted 779 22.60 285 21.01 Vested (937) (1) 16.30 (370) 14.11 Forfeited (21) 15.23 (32) 12.37 Converted to Venator awards (237) 11.81 (93) 13.72 Nonvested at September 30, 2017 2,580 14.92 702 14.66 (1) As of September 30, 2017, a total of 460,750 restricted stock units were vested but not yet issued, of which 25,704 vested during the nine months ended September 30, 2017. 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. |
NET INCOME PER SHARE (Tables)
NET INCOME PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
NET INCOME PER SHARE | |
Schedule of basic and diluted income per share | Basic and diluted income per share is determined using the following information (in millions): Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Numerator: Basic and diluted income from continuing operations: Income from continuing operations attributable to Huntsman Corporation $ 84 $ 31 $ 289 $ 210 Basic and diluted net income: Net income attributable to Huntsman Corporation $ 147 $ 55 $ 390 $ 198 Denominator: Weighted average shares outstanding 238.5 236.3 238.0 236.2 Dilutive shares: Stock-based awards 5.5 3.8 5.5 2.9 Total weighted average shares outstanding, including dilutive shares 244.0 240.1 243.5 239.1 |
OPERATING SEGMENT INFORMATION (
OPERATING SEGMENT INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
OPERATING SEGMENT INFORMATION | |
Schedule of major products by reportable operating segment | Segment Products Polyurethanes MDI, PO, polyols, PG, TPU, aniline and MTBE Performance Products amines, surfactants, LAB, maleic anhydride, other performance chemicals, EG, olefins and technology licenses Advanced Materials 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 |
Schedule of revenues and EBITDA for each of the entity's reportable operating segments and reconciliation of adjusted EBITDA to net income | The revenues and EBITDA for each of our reportable operating segments are as follows (dollars in millions): Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Revenues: Polyurethanes $ 1,197 $ 891 $ 3,172 $ 2,703 Performance Products 501 509 1,595 1,611 Advanced Materials 263 247 782 774 Textile Effects 193 184 586 567 Corporate and eliminations 15 — 20 (41) Total $ 2,169 $ 1,831 $ 6,155 $ 5,614 Huntsman Corporation: Segment adjusted EBITDA(1): Polyurethanes $ 245 $ 137 $ 556 $ 439 Performance Products 63 70 249 248 Advanced Materials 56 55 166 173 Textile Effects 19 17 64 59 Corporate and other(2) (43) (45) (136) (132) Total 340 234 899 787 Reconciliation of adjusted EBITDA to net income: Interest expense—continuing operations (39) (52) (134) (153) Interest (expense) income—discontinued operations (8) — (8) 1 Income tax expense—continuing operations (35) (6) (78) (65) Income tax (expense) benefit—discontinued operations (17) 7 (41) 8 Depreciation and amortization—continuing operations (80) (83) (235) (238) Depreciation and amortization—discontinued operations (9) (30) (68) (84) Net income attributable to noncontrolling interests 32 9 64 22 Other adjustments: Business acquisition and integration expenses (10) (6) (17) (11) Merger costs (12) — (18) — EBITDA from discontinued operations 97 47 218 63 Minority interest of discontinued operations (12) (3) (18) (8) Loss on early extinguishment of debt (35) (1) (36) (3) Certain legal settlements and related expenses — — (1) — Gain on sale of assets — — 8 — Amortization of pension and postretirement actuarial losses (19) (14) (55) (42) Plant incident remediation costs (13) — (13) — Restructuring, impairment and plant closing and transition costs (1) (38) (13) (57) Net income $ 179 $ 64 $ 454 $ 220 (1) Segment adjusted EBITDA is defined as net income of Huntsman Corporation or Huntsman International, as appropriate, before interest, income tax, depreciation and amortization, net income attributable to noncontrolling interests and certain Corporate and other items, as well as eliminating the following adjustments: (a) business acquisition and integration expenses; (b) merger costs; (c) EBITDA from discontinued operations; (d) minority interest of discontinued operations; (e) loss on early extinguishment of debt; (f) certain legal settlements and related expenses; (g) gain on sale of assets; (h) amortization of pension and postretirement actuarial losses; (i) net plant incident credits (costs); and (j) restructuring, impairment and plant closing and transition costs. (2) Corporate and other includes unallocated corporate overhead, unallocated foreign 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, benzene sales and gains and losses on the disposition of corporate assets. |
Huntsman International | |
OPERATING SEGMENT INFORMATION | |
Schedule of revenues and EBITDA for each of the entity's reportable operating segments and reconciliation of adjusted EBITDA to net income | Three months Nine months ended ended September 30, September 30, 2017 2016 2017 2016 Huntsman International: Segment adjusted EBITDA(1): Polyurethanes $ 245 $ 137 $ 556 $ 439 Performance Products 63 70 249 248 Advanced Materials 56 55 166 173 Textile Effects 19 17 64 59 Corporate and other(2) (41) (43) (132) (128) Total 342 236 903 791 Reconciliation of adjusted EBITDA to net income: Interest expense—continuing operations (44) (55) (146) (162) Interest (expense) income—discontinued operations (8) — (8) 1 Income tax expense—continuing operations (34) (7) (77) (65) Income tax (expense) benefit—discontinued operations (17) 7 (41) 8 Depreciation and amortization—continuing operations (78) (79) (227) (228) Depreciation and amortization—discontinued operations (9) (30) (68) (84) Net income attributable to noncontrolling interests 32 9 64 22 Other adjustments: Business acquisition and integration expenses (10) (6) (17) (11) Merger costs (12) — (18) — EBITDA from discontinued operations 96 45 215 58 Minority interest of discontinued operations (12) (3) (18) (8) Loss on early extinguishment of debt (35) (1) (36) (3) Certain legal settlements and related expenses — — (1) — Gain on sale of assets — — 8 — Amortization of pension and postretirement actuarial losses (20) (15) (57) (44) Plant incident remediation costs (13) — (13) — Restructuring, impairment and plant closing and transition costs (1) (38) (13) (57) Net income $ 177 $ 63 $ 450 $ 218 (1) Segment adjusted EBITDA is defined as net income of Huntsman Corporation or Huntsman International, as appropriate, before interest, income tax, depreciation and amortization, net income attributable to noncontrolling interests and certain Corporate and other items, as well as eliminating the following adjustments: (a) business acquisition and integration expenses; (b) merger costs; (c) EBITDA from discontinued operations; (d) loss on early extinguishment of debt; (e) certain legal settlements and related expenses; (f) gain on sale of assets; (g) amortization of pension and postretirement actuarial losses; (h) net plant incident credits (costs); (i) restructuring, impairment and plant closing costs; and (j) business separation expenses. (2) Corporate and other includes unallocated corporate overhead, unallocated foreign 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, benzene sales and gains and losses on the disposition of corporate assets. |
CONDENSED CONSOLIDATING FINAN40
CONDENSED CONSOLIDATING FINANCIAL INFORMATION - HUNTSMAN INTERNATIONAL (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
CONDENSED CONSOLIDATING FINANCIAL INFORMATION - HUNTSMAN INTERNATIONAL | |
CONDENSED CONSOLIDATING BALANCE SHEETS | AS OF SEPTEMBER 30, 2017 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC ASSETS Current assets: Cash and cash equivalents $ 56 $ — $ 382 $ — $ 438 Restricted cash — — 11 — 11 Accounts and notes receivable, net 36 73 1,108 5 1,222 Accounts receivable from affiliates 873 4,213 122 (4,855) 353 Inventories 81 201 808 (6) 1,084 Prepaid expenses 18 6 31 (9) 46 Other current assets 735 3 195 (740) 193 Current assets held for sale — — 2,745 — 2,745 Total current assets 1,799 4,496 5,402 (5,605) 6,092 Property, plant and equipment, net 451 1,111 1,469 — 3,031 Investment in unconsolidated affiliates 6,074 2,302 255 (8,376) 255 Intangible assets, net 27 — 30 — 57 Goodwill (14) 82 71 — 139 Deferred income taxes 510 — 280 (522) 268 Notes receivable from affiliates 111 565 — (676) — Other noncurrent assets 47 172 245 — 464 Total assets $ 9,005 $ 8,728 $ 7,752 $ (15,179) $ 10,306 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 60 $ 175 $ 631 $ 5 $ 871 Accounts payable to affiliates 3,783 537 602 (4,855) 67 Accrued liabilities 88 825 375 (750) 538 Note payable to affiliate 100 — — — 100 Current portion of debt 5 — 24 — 29 Current liabilities held for sale — — 1,633 — 1,633 Total current liabilities 4,036 1,537 3,265 (5,600) 3,238 Long-term debt 2,504 — 341 — 2,845 Notes payable to affiliates 717 — 676 (676) 717 Deferred income taxes — 281 66 74 421 Other noncurrent liabilities 173 268 589 — 1,030 Total liabilities 7,430 2,086 4,937 (6,202) 8,251 Equity Huntsman International LLC members’ equity Members’ equity 3,412 2,256 3,484 (5,740) 3,412 Accumulated (deficit) income (483) 2,908 166 (3,074) (483) Accumulated other comprehensive (loss) income (1,354) 1,478 (1,304) (174) (1,354) Total Huntsman International LLC members’ equity 1,575 6,642 2,346 (8,988) 1,575 Noncontrolling interests in subsidiaries — — 469 11 480 Total equity 1,575 6,642 2,815 (8,977) 2,055 Total liabilities and equity $ 9,005 $ 8,728 $ 7,752 $ (15,179) $ 10,306 AS OF SEPTEMBER 30, 2016 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC ASSETS Current assets: Cash and cash equivalents $ 37 $ — $ 347 $ — $ 384 Restricted cash — — 11 — 11 Accounts and notes receivable, net 22 88 1,053 5 1,168 Accounts receivable from affiliates 1,351 4,589 149 (5,760) 329 Inventories 85 183 652 (2) 918 Prepaid expenses 68 46 36 (101) 49 Other current assets 820 3 129 (725) 227 Current assets held for sale — — 777 — 777 Total current assets 2,383 4,909 3,154 (6,583) 3,863 Property, plant and equipment, net 463 1,163 1,385 1 3,012 Investment in unconsolidated affiliates 5,870 1,458 245 (7,325) 248 Intangible assets, net 28 — 15 — 43 Goodwill (12) 82 51 — 121 Deferred income taxes 515 — 265 (527) 253 Notes receivable from affiliates 37 620 — (657) — Other noncurrent assets 74 188 210 — 472 Noncurrent assets held for sale — — 1,463 — 1,463 Total assets $ 9,358 $ 8,420 $ 6,788 $ (15,091) $ 9,475 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 63 $ 152 $ 553 $ 5 $ 773 Accounts payable to affiliates 3,667 645 1,499 (5,760) 51 Accrued liabilities 87 787 420 (826) 468 Note payable to affiliate 100 — — — 100 Current portion of debt 30 — 20 — 50 Current liabilities held for sale — — 467 — 467 Total current liabilities 3,947 1,584 2,959 (6,581) 1,909 Long-term debt 3,763 — 359 — 4,122 Notes payable to affiliates 696 — 658 (657) 697 Deferred income taxes 22 257 19 69 367 Other noncurrent liabilities 174 300 577 — 1,051 Noncurrent liabilities held for sale — — 393 — 393 Total liabilities 8,602 2,141 4,965 (7,169) 8,539 Equity Huntsman International LLC members’ equity Members’ equity 3,226 2,949 5,019 (7,968) 3,226 Accumulated (deficit) income (779) 2,332 (1,713) (619) (779) Accumulated other comprehensive (loss) income (1,691) 998 (1,652) 654 (1,691) Total Huntsman International LLC members' equity 756 6,279 1,654 (7,933) 756 Noncontrolling interests in subsidiaries — — 169 11 180 Total equity 756 6,279 1,823 (7,922) 936 Total liabilities and equity $ 9,358 $ 8,420 $ 6,788 $ (15,091) $ 9,475 |
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME | THREE MONTHS ENDED SEPTEMBER 30, 2017 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Revenues: Trade sales, services and fees, net $ 296 $ 498 $ 1,343 $ — $ 2,137 Related party sales 55 75 255 (353) 32 Total revenues 351 573 1,598 (353) 2,169 Cost of goods sold 275 520 1,251 (352) 1,694 Gross profit 76 53 347 (1) 475 Selling, general and administrative 34 31 132 — 197 Research and development 12 11 12 — 35 Restructuring, impairment and plant closing (credits) costs (3) 1 3 — 1 Merger costs 12 — — — 12 Other operating expense (income), net 20 (8) (7) — 5 Operating income 1 18 207 (1) 225 Interest (expense) income (43) 7 (8) — (44) Equity in income of investment in affiliates and subsidiaries 187 180 1 (367) 1 Loss on early extinguishment of debt (35) — — — (35) Dividend income (expense) 1 — (1) — — Other income, net (1) 2 1 — 2 Income from continuing operations before income taxes 110 207 200 (368) 149 Income tax benefit (expense) 26 (11) (49) — (34) Income from continuing operations 136 196 151 (368) 115 Income (loss) from discontinued operations, net of tax 9 (1) 54 — 62 Net income 145 195 205 (368) 177 Net income attributable to noncontrolling interests — — (32) — (32) Net income attributable to Huntsman International LLC $ 145 $ 195 $ 173 $ (368) $ 145 Net income $ 145 $ 195 $ 205 $ (368) $ 177 Other comprehensive income 171 329 113 (509) 104 Comprehensive income attributable to noncontrolling interests — — (36) (1) (37) Comprehensive income attributable to Huntsman International LLC $ 316 $ 524 $ 282 $ (878) $ 244 THREE MONTHS ENDED SEPTEMBER 30, 2016 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Revenues: Trade sales, services and fees, net $ 264 $ 424 $ 1,114 $ — $ 1,802 Related party sales 45 64 231 (311) 29 Total revenues 309 488 1,345 (311) 1,831 Cost of goods sold 249 434 1,101 (310) 1,474 Gross profit 60 54 244 (1) 357 Selling, general and administrative 33 25 126 — 184 Research and development 13 11 10 — 34 Restructuring, impairment and plant closing costs 2 6 30 — 38 Other operating income, net 3 (8) 3 — (2) Operating income 9 20 75 (1) 103 Interest (expense) income (54) 7 (8) — (55) Equity in (loss) income of investment in affiliates and subsidiaries 82 80 2 (163) 1 Loss on early extinguishment of debt (1) — — — (1) Dividend income (expense) 1 — (2) 1 — Other (loss) income, net (3) — 3 — — Income from continuing operations before income taxes 34 107 70 (163) 48 Income tax benefit (expense) 20 (13) (14) — (7) Income from continuing operations 54 94 56 (163) 41 Loss from discontinued operations, net of tax — — 22 — 22 Net income 54 94 78 (163) 63 Net income attributable to noncontrolling interests — — (9) — (9) Net income attributable to Huntsman International LLC $ 54 $ 94 $ 69 $ (163) $ 54 Net income $ 54 $ 94 $ 78 $ (163) $ 63 Other comprehensive income 32 7 31 (38) 32 Comprehensive income attributable to noncontrolling interests — — (6) (3) (9) Comprehensive income attributable to Huntsman International LLC $ 86 $ 101 $ 103 $ (204) $ 86 NINE MONTHS ENDED SEPTEMBER 30, 2017 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Revenues: Trade sales, services and fees, net $ 824 $ 1,543 $ 3,681 $ — $ 6,048 Related party sales 169 248 772 (1,082) 107 Total revenues 993 1,791 4,453 (1,082) 6,155 Cost of goods sold 792 1,551 3,585 (1,079) 4,849 Gross profit 201 240 868 (3) 1,306 Selling, general and administrative 129 94 356 — 579 Research and development 35 31 37 — 103 Restructuring, impairment and plant closing costs 1 — 12 — 13 Merger costs 18 — — — 18 Other operating expense (income), net 36 (33) (12) — (9) Operating (expense) income (18) 148 475 (3) 602 Interest (expense) income (143) 20 (23) — (146) Equity in income of investment in affiliates and subsidiaries 534 453 5 (988) 4 Loss on early extinguishment of debt (36) — — — (36) Dividend income 1 — — (1) — Other income, net 1 — 4 — 5 Income from continuing operations before income taxes 339 621 461 (992) 429 Income tax benefit (expense) 56 (58) (75) — (77) Income from continuing operations 395 563 386 (992) 352 (Loss) income from discontinued operations, net of tax (7) (2) 107 — 98 Net income 388 561 493 (992) 450 Net income attributable to noncontrolling interests — — (64) — (64) Net income attributable to Huntsman International LLC $ 388 $ 561 $ 429 $ (992) $ 386 Net income $ 388 $ 561 $ 493 $ (992) $ 450 Other comprehensive income 337 479 289 (828) 277 Comprehensive income attributable to noncontrolling interests — — (70) (6) (76) Comprehensive income attributable to Huntsman International LLC $ 725 $ 1,040 $ 712 $ (1,826) $ 651 NINE MONTHS ENDED SEPTEMBER 30, 2016 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Revenues: Trade sales, services and fees, net $ 787 $ 1,396 $ 3,336 $ — $ 5,519 Related party sales 139 222 700 (966) 95 Total revenues 926 1,618 4,036 (966) 5,614 Cost of goods sold 726 1,343 3,339 (967) 4,441 Gross profit 200 275 697 1 1,173 Selling, general and administrative 117 79 365 — 561 Research and development 35 32 36 — 103 Restructuring, impairment and plant closing costs 5 15 36 — 56 Other operating expense (income), net 11 (28) 14 — (3) Operating income 32 177 246 1 456 Interest (expense) income (165) 24 (21) — (162) Equity in income of investment in affiliates and subsidiaries 67 183 6 (252) 4 Loss on early extinguishment of debt (3) — — — (3) Dividend income (expense) 217 (430) 430 (217) — Other (loss) income , net (3) — 8 — 5 Income (loss) from continuing operations before income taxes 145 (46) 669 (468) 300 Income tax benefit (expense) 50 (71) (44) — (65) Income (loss) from continuing operations 195 (117) 625 (468) 235 Income (loss) from discontinued operations, net of tax 1 (1) (17) — (17) Net income (loss) 196 (118) 608 (468) 218 Net income attributable to noncontrolling interests — — (19) (3) (22) Net income (loss) attributable to Huntsman International LLC $ 196 $ (118) $ 589 $ (471) $ 196 Net income (loss) $ 196 $ (118) $ 608 $ (468) $ 218 Other comprehensive income 27 86 32 (118) 27 Comprehensive income attributable to noncontrolling interests — — (11) (11) (22) Comprehensive income (loss) attributable to Huntsman International LLC $ 223 $ (32) $ 629 $ (597) $ 223 |
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | NINE MONTHS ENDED SEPTEMBER 30, 2017 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Net cash provided by (used in) operating activities from continuing operations $ 274 $ 514 $ (252) $ — $ 536 Net cash (used in) provided by operating activities from discontinued operations (19) — 221 — 202 Net cash provided by (used in) operating activities 255 514 (31) — 738 Investing activities: Capital expenditures (26) (37) (96) — (159) Cash received from consolidated affiliates 800 — (278) (522) — Acquisition of business, net of cash acquired — — (14) — (14) Proceeds from sale of businesses/assets — — 21 — 21 Increase in receivable from affiliate (3) — — — (3) Cash received from termination of cross-currency interest rate contracts 7 — — — 7 Other, net 1 — — — 1 Net cash provided by (used in) investing activities from continuing operations 779 (37) (367) (522) (147) Net cash used in investing activities from discontinued operations — — (49) — (49) Net cash provided by (used in) investing activities 779 (37) (416) (522) (196) Financing activities: Net repayments under revolving loan facilities — — (36) — (36) Repayments of short-term debt — — (10) — (10) Borrowings on short-term debt — — 6 — 6 Repayments of long-term debt (1,416) — (23) — (1,439) Proceeds from long-term debt of P&A Business — — 750 — 750 Proceeds from issuance of long-term debt — — 24 — 24 Proceeds from issuance of notes payable from affiliate 21 — — — 21 Repayments of notes payable (20) — — — (20) Borrowings on notes payable 11 — — — 11 Debt issuance costs paid (3) — (18) — (21) Dividends paid to noncontrolling interests — — (26) — (26) Contribution from noncontrolling interests — — 4 — 4 Distribution to parent — (477) (45) 522 — Dividends paid to parent (90) — — — (90) Proceeds from the IPO of P&A Business 522 — — — 522 Cash paid for the expenses of the IPO of P&A Business (40) — — — (40) Other, net — — 1 — 1 Net cash (used in) provided by financing activities (1,015) (477) 627 522 (343) Effect of exchange rate changes on cash — — 12 — 12 Increase in cash and cash equivalents 19 — 192 — 211 Cash and cash equivalents from continuing operations at beginning of period 37 — 347 — 384 Cash and cash equivalents from discontinued operations at beginning of period — — 29 — 29 Cash and cash equivalents at end of period $ 56 $ — $ 568 $ — $ 624 NINE MONTHS ENDED SEPTEMBER 30, 2016 (In Millions) Consolidated Parent Huntsman Company Guarantors Nonguarantors Eliminations International LLC Net cash provided by operating activities from continuing operations $ 410 $ 87 $ 239 $ — $ 736 Net cash provided by operating activities from discontinued operations — — 107 — 107 Net cash provided by operating activities 410 87 346 — 843 Investing activities: Capital expenditures (24) (66) (124) — (214) Investment in affiliate (11) (3) (2) 14 (2) Decrease in receivable in affiliate 3 — — — 3 Change in restricted cash — — 1 — 1 Other, net — 1 1 — 2 Net cash used in investing activities from continuing operations (32) (68) (124) 14 (210) Net cash used in investing activities from discontinued operations — — (57) — (57) Net cash used in investing activities (32) (68) (181) 14 (267) Financing activities: Net repayments on overdraft facilities $ — $ (1) $ — $ — $ (1) Repayments of short-term debt — — (41) — (41) Borrowings on short-term debt — — 8 — 8 Repayments of long-term debt (774) — (21) — (795) Proceeds from issuance of long-term debt 547 — 5 — 552 Repayments of notes payable to affiliate (7) — — 6 (1) Proceeds of notes payable to affiliate — — 6 (6) — Repayments of notes payable (23) — (2) — (25) Borrowings on notes payable 30 — 1 — 31 Debt issuance costs paid (8) — — — (8) Dividends paid to noncontrolling interests — — (26) — (26) Contribution from parent — 3 31 (34) — Distribution to parent — (20) — 20 — Dividends paid to parent (89) (1) — — (90) Other, net 1 — — — 1 Net cash used in financing activities (323) (19) (39) (14) (395) Effect of exchange rate changes on cash from continuing operations — — 1 — 1 Increase in cash and cash equivalents 55 — 127 — 182 Cash and cash equivalents from continuing operations at beginning of period 44 192 236 Cash and cash equivalents from discontinued operations at beginning of period — — 21 — 21 Cash and cash equivalents at end of period $ 99 $ — $ 340 $ — $ 439 |
GENERAL (Details)
GENERAL (Details) $ in Millions | Oct. 25, 2017USD ($) | Jul. 26, 2017USD ($) | Apr. 25, 2017USD ($) | Aug. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)segment | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) |
GENERAL | |||||||||
Number of operating segments | segment | 4 | ||||||||
Loss on early extinguishment of debt | $ 35 | $ 1 | $ 36 | $ 3 | |||||
Debt issuance costs | 25 | 25 | $ 57 | ||||||
Merger | |||||||||
Merger costs | $ 12 | $ 18 | |||||||
Venator Materials PLC | |||||||||
GENERAL | |||||||||
Ownership interest (as a percent) | 75.00% | 75.00% | 75.00% | ||||||
Principal amount of debt | $ 750 | ||||||||
Debt issuance costs | 18 | ||||||||
Huntsman International | |||||||||
GENERAL | |||||||||
Ownership interest (as a percent) | 100.00% | 100.00% | |||||||
Net proceeds from Venator | 732 | ||||||||
Loss on early extinguishment of debt | $ 35 | 1 | $ 36 | 3 | |||||
Merger | |||||||||
Merger costs | 12 | 18 | |||||||
Huntsman International | 2015 Extended Term Loan B | |||||||||
GENERAL | |||||||||
Early repayment of term loan | $ 100 | $ 100 | 106 | ||||||
Huntsman International | Senior Credit Facilities | |||||||||
GENERAL | |||||||||
Early repayment of term loan | 1,207 | ||||||||
Proceeds from issuance of shares | 475 | ||||||||
Loss on early extinguishment of debt | 34 | ||||||||
Huntsman International | 2021 Term Loan B | |||||||||
GENERAL | |||||||||
Early repayment of term loan | 347 | ||||||||
Huntsman International | 2023 Term Loan B | |||||||||
GENERAL | |||||||||
Early repayment of term loan | $ 100 | $ 754 | |||||||
Loss on early extinguishment of debt | $ 3 | ||||||||
Termination of Huntsman and Clariant Merger Agreement | |||||||||
GENERAL | |||||||||
Amount payable per terms of agreement | 0 | 0 | |||||||
Huntsman and Clariant Merger | |||||||||
Merger | |||||||||
Merger costs | $ 12 | $ 0 | $ 18 | $ 0 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 | |
Inventories | |||
Raw materials and supplies | $ 218 | $ 157 | |
Work in progress | 54 | 45 | |
Finished goods | 867 | 771 | |
Total | 1,139 | 973 | |
LIFO reserves | (55) | (55) | |
Net inventories | [1] | $ 1,084 | $ 918 |
Percentage of inventories recorded using the LIFO cost method | 13.00% | 13.00% | |
[1] | At September 30, 2017 and December 31, 2016, respectively, $35 and $20 of cash and cash equivalents, $11 and $10 of restricted cash, $29 and $21 of accounts and notes receivable (net), $42 and $45 of inventories, $6 and $5 of other current assets, $272 and $279 of property, plant and equipment (net), $10 each of intangible assets (net), $39 and $37 of other noncurrent assets, $81 and $89 of accounts payable, $29 and $30 of accrued liabilities, $20 and $12 of current portion of debt, $94 and $114 of longterm debt, and $80 and $76 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See “Note 5. Variable Interest Entities.” |
DISCONTINUED OPERATIONS - BALAN
DISCONTINUED OPERATIONS - BALANCE SHEET (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2017 | Aug. 31, 2017 | Dec. 31, 2016 | |
Carrying amounts of major classes of assets held for sale: | |||
Total current assets | $ 2,745 | $ 777 | |
Total noncurrent assets(a) | 1,463 | ||
Carrying amounts of major classes of liabilities held for sale: | |||
Total current liabilities(a) | $ 1,633 | 467 | |
Total noncurrent liabilities(a) | 393 | ||
Venator Materials PLC | |||
DISCONTINUED OPERATIONS | |||
Ownership interest (as a percent) | 75.00% | 75.00% | |
Expected period of service provided after separation | 24 months | ||
Discontinued Operations, Disposed of by Means Other than Sale | Pigments and Additives Business and Australian Business | |||
Carrying amounts of major classes of assets held for sale: | |||
Accounts receivable | $ 411 | 234 | |
Inventories | 432 | 426 | |
Other current assets | 280 | 117 | |
Total current assets | 777 | ||
Property, plant and equipment, net | 1,290 | 1,178 | |
Deferred income taxes | 195 | 143 | |
Other noncurrent assets | 137 | 142 | |
Total noncurrent assets(a) | 1,463 | ||
Total assets held for sale | 2,745 | 2,240 | |
Carrying amounts of major classes of liabilities held for sale: | |||
Accounts payable | 319 | 297 | |
Accrued liabilities | 213 | 145 | |
Other current liabilities | 16 | 25 | |
Total current liabilities(a) | 467 | ||
Deferred income taxes | 56 | ||
Long term debt | 747 | ||
Other noncurrent liabilities | 338 | 337 | |
Total noncurrent liabilities(a) | 393 | ||
Total liabilities held for sale | $ 1,633 | $ 860 |
DISCONTINUED OPERATIONS - OPERA
DISCONTINUED OPERATIONS - OPERATIONS DATA (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Major classes of line items constituting pretax income (loss) of discontinued operations: | ||||
Income tax (expense) benefit | $ (17) | $ 7 | $ (41) | $ 8 |
Income (loss) from discontinued operations, net of tax | 63 | 24 | 101 | (12) |
Net income (loss) attributable to discontinued operations | 63 | 24 | 101 | (12) |
Pigments and Additives Business and Australian Business | Discontinued Operations, Disposed of by Means Other than Sale | ||||
Major classes of line items constituting pretax income (loss) of discontinued operations: | ||||
Trade sales, services and fees, net | 589 | 540 | 1,700 | 1,670 |
Cost of goods sold | 470 | 496 | 1,421 | 1,566 |
Selling, general and administrative | 54 | 42 | 128 | 131 |
Restructuring, impairment and plant closing costs | 17 | 8 | 51 | 32 |
Business separation expenses | 11 | 32 | ||
Other operating income, net | (51) | (23) | (83) | (37) |
Other loss (income), net | 8 | 9 | (2) | |
Income (loss) from discontinued operations before tax | 80 | 17 | 142 | (20) |
Income tax (expense) benefit | (17) | 7 | (41) | 8 |
Income (loss) from discontinued operations, net of tax | 63 | 24 | 101 | (12) |
Net income attributable to noncontrolling interests | (2) | (3) | (8) | (8) |
Net income (loss) attributable to discontinued operations | 61 | 21 | 93 | (20) |
Huntsman International | ||||
Major classes of line items constituting pretax income (loss) of discontinued operations: | ||||
Income tax (expense) benefit | (17) | 7 | (41) | 8 |
Income (loss) from discontinued operations, net of tax | 62 | 22 | 98 | (17) |
Huntsman International | Pigments and Additives Business and Australian Business | Discontinued Operations, Disposed of by Means Other than Sale | ||||
Major classes of line items constituting pretax income (loss) of discontinued operations: | ||||
Trade sales, services and fees, net | 589 | 540 | 1,700 | 1,670 |
Cost of goods sold | 471 | 498 | 1,424 | 1,571 |
Selling, general and administrative | 54 | 42 | 128 | 131 |
Restructuring, impairment and plant closing costs | 17 | 8 | 51 | 32 |
Business separation expenses | 11 | 32 | ||
Other operating income, net | (51) | (23) | (83) | (37) |
Other loss (income), net | 8 | 9 | (2) | |
Income (loss) from discontinued operations before tax | 79 | 15 | 139 | (25) |
Income tax (expense) benefit | (17) | 7 | (41) | 8 |
Income (loss) from discontinued operations, net of tax | 62 | 22 | 98 | (17) |
Net income attributable to noncontrolling interests | (2) | (3) | (8) | (8) |
Net income (loss) attributable to discontinued operations | $ 60 | $ 19 | $ 90 | $ (25) |
VARIABLE INTEREST ENTITIES (Det
VARIABLE INTEREST ENTITIES (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)item | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | ||
Assets and liabilities of VIE | ||||||
Current assets | $ 5,767 | $ 5,767 | $ 3,555 | |||
Property, plant and equipment, net | [1] | 3,035 | 3,035 | 3,034 | ||
Other noncurrent assets | [1] | 463 | 463 | 472 | ||
Deferred income taxes | 268 | 268 | 253 | |||
Intangible assets | [1] | 56 | 56 | 43 | ||
Goodwill | 139 | 139 | 121 | |||
Total assets | 9,983 | 9,983 | 9,189 | |||
Current liabilities | 3,090 | 3,090 | 1,778 | |||
Long-term debt | [1] | 2,845 | 2,845 | 4,122 | ||
Deferred income taxes | 426 | 426 | 371 | |||
Other noncurrent liabilities | [1] | 1,031 | 1,031 | 1,057 | ||
Total liabilities | 7,392 | 7,392 | 7,722 | |||
Revenues, income from continuing operations before income taxes and net cash provided by operating activities for our variable interest entities | ||||||
Revenues | 2,169 | $ 1,831 | 6,155 | $ 5,614 | ||
Income from continuing operations before income taxes | 151 | 46 | 431 | 297 | ||
Net cash provided by operating activities | $ 743 | 848 | ||||
Number of variable interests of additional joint ventures held prior to Separation | item | 2 | |||||
Rubicon, Arabian Amines, and Sasol Huntsman | ||||||
Assets and liabilities of VIE | ||||||
Current assets | 124 | $ 124 | 103 | |||
Property, plant and equipment, net | 272 | 272 | 279 | |||
Other noncurrent assets | 107 | 107 | 99 | |||
Deferred income taxes | 43 | 43 | 43 | |||
Intangible assets | 10 | 10 | 10 | |||
Goodwill | 14 | 14 | 12 | |||
Total assets | 570 | 570 | 546 | |||
Current liabilities | 131 | 131 | 131 | |||
Long-term debt | 94 | 94 | 114 | |||
Deferred income taxes | 11 | 11 | 10 | |||
Other noncurrent liabilities | 80 | 80 | 76 | |||
Total liabilities | 316 | 316 | $ 331 | |||
Revenues, income from continuing operations before income taxes and net cash provided by operating activities for our variable interest entities | ||||||
Revenues | 32 | 24 | 99 | 72 | ||
Income from continuing operations before income taxes | 8 | 2 | 22 | 12 | ||
Net cash provided by operating activities | $ 20 | $ 13 | $ 42 | $ 37 | ||
Rubicon LLC | ||||||
Identification of variable interest entities through investments and transactions | ||||||
Variable interest entity ownership percentage | 50.00% | |||||
AAC | ||||||
Identification of variable interest entities through investments and transactions | ||||||
Variable interest entity ownership percentage | 50.00% | |||||
Sasol Huntsman GmbH and Co. KG | ||||||
Identification of variable interest entities through investments and transactions | ||||||
Variable interest entity ownership percentage | 50.00% | |||||
[1] | At September 30, 2017 and December 31, 2016, respectively, $35 and $20 of cash and cash equivalents, $11 and $10 of restricted cash, $29 and $21 of accounts and notes receivable (net), $42 and $45 of inventories, $6 and $5 of other current assets, $272 and $279 of property, plant and equipment (net), $10 each of intangible assets (net), $39 and $37 of other noncurrent assets, $81 and $89 of accounts payable, $29 and $30 of accrued liabilities, $20 and $12 of current portion of debt, $94 and $114 of longterm debt, and $80 and $76 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See “Note 5. Variable Interest Entities.” |
RESTRUCTURING, IMPAIRMENT AND46
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS - ACCRUED RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS BY TYPE OF COST AND INITIATIVE (Details) $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 30, 2017USD ($) | Sep. 30, 2017USD ($)item | |
Accrued restructuring costs roll forward | ||
Accrued liabilities at the beginning of the period | $ 68 | |
Foreign currency effect on liability balance | 4 | |
Accrued liabilities at the end of the period | $ 59 | $ 59 |
Number of positions terminated | item | 163 | |
Number of positions not terminated | item | 116 | |
2016 and prior initiatives | ||
Accrued restructuring costs roll forward | ||
Restructuring charges | 2 | $ 7 |
Restructuring payments | (24) | |
2017 initiatives | ||
Accrued restructuring costs roll forward | ||
Restructuring charges | 6 | |
Restructuring payments | (2) | |
Accrued liabilities at the end of the period | 4 | 4 |
Workforce reductions | ||
Accrued restructuring costs roll forward | ||
Accrued liabilities at the beginning of the period | 4 | |
Foreign currency effect on liability balance | 1 | |
Accrued liabilities at the end of the period | 9 | 9 |
Workforce reductions | 2017 initiatives | ||
Accrued restructuring costs roll forward | ||
Restructuring charges | 6 | |
Restructuring payments | (2) | |
Demolition and decommissioning | ||
Accrued restructuring costs roll forward | ||
Accrued liabilities at the beginning of the period | 19 | |
Foreign currency effect on liability balance | 1 | |
Accrued liabilities at the end of the period | 4 | 4 |
Demolition and decommissioning | 2016 and prior initiatives | ||
Accrued restructuring costs roll forward | ||
Restructuring charges | 5 | |
Restructuring payments | (21) | |
Non-cancelable lease and contract termination costs | ||
Accrued restructuring costs roll forward | ||
Accrued liabilities at the beginning of the period | 40 | |
Foreign currency effect on liability balance | 2 | |
Accrued liabilities at the end of the period | 42 | 42 |
Non-cancelable lease and contract termination costs | 2016 and prior initiatives | ||
Accrued restructuring costs roll forward | ||
Restructuring charges | 1 | |
Restructuring payments | (1) | |
Other restructuring costs | ||
Accrued restructuring costs roll forward | ||
Accrued liabilities at the beginning of the period | 5 | |
Accrued liabilities at the end of the period | $ 4 | 4 |
Other restructuring costs | 2016 and prior initiatives | ||
Accrued restructuring costs roll forward | ||
Restructuring charges | 1 | |
Restructuring payments | $ (2) |
RESTRUCTURING, IMPAIRMENT AND47
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS - ACCRUED LIABILITIES BY INITIATIVE (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Accrued liabilities by initiatives | ||
Accrued liabilities | $ 59 | $ 68 |
2015 and prior initiatives | ||
Accrued liabilities by initiatives | ||
Accrued liabilities | 55 | 67 |
2016 initiatives | ||
Accrued liabilities by initiatives | ||
Accrued liabilities | $ 1 | |
2017 initiatives | ||
Accrued liabilities by initiatives | ||
Accrued liabilities | $ 4 |
RESTRUCTURING, IMPAIRMENT AND48
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS - RESERVES FOR RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | |
Accrued restructuring costs roll forward | |||
Accrued liabilities at the beginning of the period | $ 68 | ||
Foreign currency effect on liability balance | 4 | ||
Accrued liabilities at the end of the period | $ 59 | 59 | |
Current portion of restructuring reserves | 19 | 19 | |
Long-term portion of restructuring reserves | 40 | 40 | |
2016 and prior initiatives | |||
Accrued restructuring costs roll forward | |||
Restructuring charges | 2 | 7 | |
Restructuring payments | (24) | ||
2017 initiatives | |||
Accrued restructuring costs roll forward | |||
Restructuring charges | 6 | ||
Restructuring payments | (2) | ||
Accrued liabilities at the end of the period | 4 | 4 | |
Corporate and Other | |||
Accrued restructuring costs roll forward | |||
Accrued liabilities at the beginning of the period | 2 | ||
Accrued liabilities at the end of the period | 2 | 2 | |
Current portion of restructuring reserves | 2 | 2 | |
Polyurethanes | |||
Accrued restructuring costs roll forward | |||
Accrued liabilities at the beginning of the period | 2 | ||
Accrued liabilities at the end of the period | 1 | 1 | |
Current portion of restructuring reserves | 1 | 1 | |
Polyurethanes | 2016 and prior initiatives | |||
Accrued restructuring costs roll forward | |||
Restructuring payments | (1) | ||
Performance Products | |||
Accrued restructuring costs roll forward | |||
Restructuring charges | $ 16 | ||
Advanced Materials | |||
Accrued restructuring costs roll forward | |||
Accrued liabilities at the beginning of the period | 3 | ||
Accrued liabilities at the end of the period | 3 | 3 | |
Current portion of restructuring reserves | 2 | 2 | |
Long-term portion of restructuring reserves | 1 | 1 | |
Textile Effects | |||
Accrued restructuring costs roll forward | |||
Accrued liabilities at the beginning of the period | 61 | ||
Foreign currency effect on liability balance | 4 | ||
Accrued liabilities at the end of the period | 53 | 53 | |
Current portion of restructuring reserves | 14 | 14 | |
Long-term portion of restructuring reserves | $ 39 | 39 | |
Textile Effects | 2016 and prior initiatives | |||
Accrued restructuring costs roll forward | |||
Restructuring charges | 7 | ||
Restructuring payments | (23) | ||
Textile Effects | 2017 initiatives | |||
Accrued restructuring costs roll forward | |||
Restructuring charges | 6 | ||
Restructuring payments | $ (2) |
RESTRUCTURING, IMPAIRMENT AND49
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS - CASH AND NONCASH RESTRUCTURING CHARGES AND OTHER INFORMATION (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)item | Sep. 30, 2016USD ($) | |
Restructuring, impairment and plant closing costs | ||||
Pension-related charges | $ 1 | |||
Gain on sale of land | $ (1) | $ (3) | (3) | $ (3) |
Accelerated depreciation | 2 | |||
Reversal of reserves no longer required | (1) | |||
Total restructuring, impairment and plant closing costs | 1 | 38 | 13 | 56 |
Impairment of long-lived assets | 0 | 0 | $ 0 | 0 |
Number of positions terminated | item | 163 | |||
Performance Products | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | 16 | |||
Textile Effects | Basel, Switzerland | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | $ 4 | |||
Upfront restructuring installment income payment expected | 5 | 5 | ||
Workforce reductions | Textile Effects | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | 7 | |||
Additional costs expected to be incurred through end of 2017 | 2 | 2 | ||
Non-cancelable lease and contract termination costs | Textile Effects | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | 8 | |||
Demolition and decommissioning | Textile Effects | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | 28 | |||
2015 and prior initiatives | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | 40 | 56 | ||
2016 and prior initiatives | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | $ 2 | 7 | ||
2016 and prior initiatives | Textile Effects | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | 7 | |||
2016 and prior initiatives | Non-cancelable lease and contract termination costs | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | 1 | |||
2016 and prior initiatives | Demolition and decommissioning | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | 5 | |||
2017 initiatives | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | 6 | |||
2017 initiatives | Textile Effects | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | 6 | |||
2017 initiatives | Workforce reductions | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | $ 6 | |||
2016 initiatives | ||||
Restructuring, impairment and plant closing costs | ||||
Restructuring charges | $ 1 | $ 4 |
DEBT - DEBT OUTSTANDING (Detail
DEBT - DEBT OUTSTANDING (Details) € in Millions, $ in Millions | Oct. 25, 2017USD ($) | Jul. 26, 2017USD ($) | Jun. 15, 2017USD ($) | Apr. 25, 2017USD ($) | Aug. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017EUR (€) | Sep. 30, 2017USD ($) | Dec. 31, 2016USD ($) | |
Debt | |||||||||||||
Total debt - excluding debt to affiliates | $ 2,874 | $ 4,172 | |||||||||||
Total current portion of debt | [1] | 29 | 50 | ||||||||||
Long-term portion | [1] | 2,845 | 4,122 | ||||||||||
Notes payable to affiliates-noncurrent | 1 | ||||||||||||
Total debt | 2,874 | 4,173 | |||||||||||
Debt issuance costs | 25 | 57 | |||||||||||
Loan to subsidiary | 817 | ||||||||||||
Loss on early extinguishment of debt | $ 35 | $ 1 | $ 36 | $ 3 | |||||||||
Consolidated VIE's | |||||||||||||
Debt | |||||||||||||
Total debt - excluding debt to affiliates | 114 | 126 | |||||||||||
Total current portion of debt | 20 | 12 | |||||||||||
Long-term portion | 94 | 114 | |||||||||||
Huntsman International | |||||||||||||
Debt | |||||||||||||
Total debt - excluding debt to affiliates | 2,874 | 4,172 | |||||||||||
Total current portion of debt | [1] | 29 | 50 | ||||||||||
Long-term portion | [1] | 2,845 | 4,122 | ||||||||||
Notes payable to affiliates-current | 100 | 100 | |||||||||||
Notes payable to affiliates-noncurrent | 717 | 697 | |||||||||||
Total debt | 3,691 | 4,969 | |||||||||||
Loss on early extinguishment of debt | $ 35 | $ 1 | $ 36 | $ 3 | |||||||||
Net proceeds from Venator | $ 732 | ||||||||||||
Debt repayment required in connection with the Separation | $ 450 | ||||||||||||
Huntsman International | U.S. A/R Program | |||||||||||||
Debt | |||||||||||||
Reduction in applicable margin on borrowings (as a percent) | 0.10% | ||||||||||||
Huntsman International | Maximum | U.S. A/R Program | |||||||||||||
Debt | |||||||||||||
Reduction in applicable margin on borrowings (as a percent) | 0.25% | ||||||||||||
Huntsman International | Consolidated VIE's | |||||||||||||
Debt | |||||||||||||
Total debt - excluding debt to affiliates | 114 | 126 | |||||||||||
Total current portion of debt | 20 | 12 | |||||||||||
Long-term portion | 94 | 114 | |||||||||||
Venator Materials PLC | |||||||||||||
Debt | |||||||||||||
Debt issuance costs | 18 | ||||||||||||
Principal amount of debt | 750 | ||||||||||||
Revolving Facility | Huntsman International | |||||||||||||
Debt | |||||||||||||
Principal Outstanding | 0 | ||||||||||||
Amount of letter of credit and bank guarantees issued and outstanding | 8 | ||||||||||||
Revolving Facility | Huntsman International | Maximum | |||||||||||||
Debt | |||||||||||||
Debt instrument covenant consolidated leverage ratio | 3.75 | ||||||||||||
Revolving Facility | Huntsman International | |||||||||||||
Debt | |||||||||||||
Maximum revolving credit facility | $ 650 | ||||||||||||
Revolving Facility | Huntsman International | LIBOR | |||||||||||||
Debt | |||||||||||||
Basis spread (as a percent) | 2.50% | ||||||||||||
Senior Credit Facilities | Huntsman International | |||||||||||||
Debt | |||||||||||||
Proceeds from issuance of shares | 475 | ||||||||||||
Weighted average interest rate (as a percent) | 4.00% | 4.00% | |||||||||||
Loss on early extinguishment of debt | 34 | ||||||||||||
Early repayment of term loan | 1,207 | ||||||||||||
Term loans | |||||||||||||
Debt | |||||||||||||
Total debt - excluding debt to affiliates | $ 592 | 1,967 | |||||||||||
Term loans | Huntsman International | |||||||||||||
Debt | |||||||||||||
Total debt - excluding debt to affiliates | 592 | 1,967 | |||||||||||
2015 Extended Term Loan B | Huntsman International | |||||||||||||
Debt | |||||||||||||
Early repayment of term loan | $ 100 | $ 100 | 106 | ||||||||||
2021 Term Loan B | Huntsman International | |||||||||||||
Debt | |||||||||||||
Early repayment of term loan | 347 | ||||||||||||
2023 Term Loan B | Huntsman International | |||||||||||||
Debt | |||||||||||||
Principal Outstanding | 611 | ||||||||||||
Unamortized Discounts and Debt Issuance Costs | (19) | ||||||||||||
Total debt | 592 | ||||||||||||
Loss on early extinguishment of debt | $ 3 | ||||||||||||
Early repayment of term loan | $ 100 | 754 | |||||||||||
2023 Term Loan B | Huntsman International | LIBOR | |||||||||||||
Debt | |||||||||||||
Basis spread (as a percent) | 3.00% | ||||||||||||
2023 Term Loan B | Huntsman International | LIBOR Floor | |||||||||||||
Debt | |||||||||||||
Basis spread (as a percent) | 0.75% | ||||||||||||
Accounts receivable programs | |||||||||||||
Debt | |||||||||||||
Total debt - excluding debt to affiliates | 184 | 208 | |||||||||||
Accounts receivable programs | Huntsman International | |||||||||||||
Debt | |||||||||||||
Total debt - excluding debt to affiliates | 184 | 208 | |||||||||||
Accounts receivable pledged as collateral | 369 | 328 | |||||||||||
U.S. A/R Program Maturing April 2020 | Huntsman International | |||||||||||||
Debt | |||||||||||||
Total debt | 90 | ||||||||||||
Amount of letter of credit and bank guarantees issued and outstanding | 7 | ||||||||||||
Maximum Funding Availability | 250 | ||||||||||||
U.S. A/R Program Maturing April 2020 | Huntsman International | USD LIBOR or CP | |||||||||||||
Debt | |||||||||||||
Basis spread (as a percent) | 0.95% | ||||||||||||
EU A/R Program Maturing April 2020 | Huntsman International | |||||||||||||
Debt | |||||||||||||
Total debt | € 80 | 94 | |||||||||||
Maximum Funding Availability | € 150 | 176 | |||||||||||
EU A/R Program Maturing April 2020 | Huntsman International | GDP LIBOR, USD LIBOR, or EURIBOR | |||||||||||||
Debt | |||||||||||||
Basis spread (as a percent) | 1.30% | ||||||||||||
Senior notes | |||||||||||||
Debt | |||||||||||||
Total debt - excluding debt to affiliates | 1,913 | 1,812 | |||||||||||
Senior notes | Huntsman International | |||||||||||||
Debt | |||||||||||||
Total debt - excluding debt to affiliates | 1,913 | 1,812 | |||||||||||
Other debt instruments | |||||||||||||
Debt | |||||||||||||
Total debt - excluding debt to affiliates | 71 | 59 | |||||||||||
Other debt instruments | Huntsman International | |||||||||||||
Debt | |||||||||||||
Total debt - excluding debt to affiliates | $ 71 | $ 59 | |||||||||||
Venator Senior Unsecured Notes | |||||||||||||
Debt | |||||||||||||
Maximum revolving credit facility | 300 | ||||||||||||
Venator Senior Unsecured Notes | Venator Materials PLC | |||||||||||||
Debt | |||||||||||||
Principal amount of debt | 375 | ||||||||||||
Venator Term Loan | Venator Materials PLC | |||||||||||||
Debt | |||||||||||||
Principal amount of debt | $ 375 | ||||||||||||
[1] | At September 30, 2017 and December 31, 2016, respectively, $35 and $20 of cash and cash equivalents, $11 and $10 of restricted cash, $29 and $21 of accounts and notes receivable (net), $42 and $45 of inventories, $6 and $5 of other current assets, $272 and $279 of property, plant and equipment (net), $10 each of intangible assets (net), $39 and $37 of other noncurrent assets, $81 and $89 of accounts payable, $29 and $30 of accrued liabilities, $20 and $12 of current portion of debt, $94 and $114 of longterm debt, and $80 and $76 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See “Note 5. Variable Interest Entities.” |
DERIVATIVE INSTRUMENTS AND HE51
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details) € in Millions, $ in Millions | 1 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Aug. 31, 2017USD ($) | Nov. 30, 2014EUR (€)item | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2009 | Sep. 30, 2017EUR (€) | Sep. 30, 2017USD ($) | Nov. 30, 2014USD ($)item | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||||||
Notional Amounts | € 505 | $ 592 | ||||||
Proceeds from termination | $ 7 | |||||||
Amount of loss recognized on the hedge of net investments | 85 | |||||||
Huntsman International | ||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||||||
Proceeds from termination | $ 7 | |||||||
Forward foreign currency contracts | ||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||||||
Maximum maturity period of spot or forward exchange rate contracts | 1 year | |||||||
Notional Amounts | 81 | |||||||
Twelve-year interest rate contract entered in year 2009 | Non Designated Hedge Instrument | AAC | ||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||||||
Notional Amounts | 16 | |||||||
Fair value of the hedge | $ 1 | |||||||
Hedging period of interest rate contract | 12 years | |||||||
Additional (reduction of) interest expense due to changes in the fair value of the hedges | $ 0 | $ 0 | ||||||
Twelve-year interest rate contract entered in year 2009 | Non Designated Hedge Instrument | AAC | LIBOR | ||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||||||
Variable rate basis | LIBOR | |||||||
Fixed percentage to be paid under the hedge | 5.02% | 5.02% | ||||||
Cross currency interest rate contracts | Designated as Hedging Instrument | ||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||||||
Notional Amounts | € 161 | $ 200 | ||||||
U.S. dollar interest payments to be received twice each year | $ 5 | |||||||
Equivalent annual rate of interest receivable (as a percent) | 5.125% | 5.125% | ||||||
U.S. dollar interest payments to be made twice each year | € | € 3 | |||||||
Equivalent annual rate of interest payable (as a percent) | 3.60% | 3.60% | ||||||
Proceeds from termination | $ 7 | |||||||
Five years cross currency interest rate contract | Designated as Hedging Instrument | ||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||||||
Number of derivative instruments held | item | 2 | 2 | ||||||
Term of cross currency interest rate contract | 5 years | |||||||
Eight years cross currency interest rate contract | Designated as Hedging Instrument | ||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||||||
Number of derivative instruments held | item | 1 | 1 | ||||||
Term of cross currency interest rate contract | 8 years |
FAIR VALUE - FAIR VALUES OF FIN
FAIR VALUE - FAIR VALUES OF FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Carrying Value | ||
Fair values of financial instruments | ||
Non-qualified employee benefit plan investments | $ 30 | $ 27 |
Investments in equity securities | 3 | 18 |
Long-term debt (including current portion) | (2,874) | (4,172) |
Carrying Value | Cross currency interest rate contracts | ||
Fair values of financial instruments | ||
Derivative contracts - assets | 29 | |
Carrying Value | Interest rate contracts | ||
Fair values of financial instruments | ||
Derivative contracts - liabilities | (1) | (2) |
Estimated Fair Value | ||
Fair values of financial instruments | ||
Non-qualified employee benefit plan investments | 30 | 27 |
Investments in equity securities | 3 | 18 |
Long-term debt (including current portion) | (3,098) | (4,345) |
Estimated Fair Value | Cross currency interest rate contracts | ||
Fair values of financial instruments | ||
Derivative contracts - assets | 29 | |
Estimated Fair Value | Interest rate contracts | ||
Fair values of financial instruments | ||
Derivative contracts - liabilities | $ (1) | $ (2) |
FAIR VALUE - ASSETS AND LIABILI
FAIR VALUE - ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS (Details) $ in Millions | 1 Months Ended | 9 Months Ended | ||
Aug. 31, 2017USD ($) | Nov. 30, 2014item | Sep. 30, 2017USD ($) | Dec. 31, 2016USD ($) | |
Assets: | ||||
Proceeds from termination | $ 7 | |||
Cross currency interest rate contracts | Designated as Hedging Instrument | ||||
Assets: | ||||
Proceeds from termination | $ 7 | |||
Five years cross currency interest rate contract | Designated as Hedging Instrument | ||||
Assets: | ||||
Number of derivative instruments held | item | 2 | |||
Term of cross currency interest rate contract | 5 years | |||
Eight years cross currency interest rate contract | Designated as Hedging Instrument | ||||
Assets: | ||||
Number of derivative instruments held | item | 1 | |||
Term of cross currency interest rate contract | 8 years | |||
Recurring basis | ||||
Assets: | ||||
Total assets | 33 | $ 74 | ||
Liabilities: | ||||
Transfers from Levels 1 to 2 within the fair value hierarchy, assets | 0 | 0 | ||
Transfers from Levels 1 and 2 within the fair value hierarchy, liabilities | 0 | 0 | ||
Transfers from Levels 2 to 1 within the fair value hierarchy, assets | 0 | 0 | ||
Transfers from Levels 2 and 1 within the fair value hierarchy, liabilities | 0 | 0 | ||
Recurring basis | Cross currency interest rate contracts | ||||
Assets: | ||||
Derivatives | 29 | |||
Recurring basis | Interest rate contracts | ||||
Liabilities: | ||||
Total liabilities | (1) | (2) | ||
Recurring basis | Non-qualified employee benefit plan investments | ||||
Assets: | ||||
Available-for-sale equity securities | 30 | 27 | ||
Recurring basis | Investments in equity securities | ||||
Assets: | ||||
Available-for-sale equity securities | 3 | 18 | ||
Recurring basis | Quoted prices in active markets for identical assets (Level 1) | ||||
Assets: | ||||
Total assets | 33 | 45 | ||
Recurring basis | Quoted prices in active markets for identical assets (Level 1) | Non-qualified employee benefit plan investments | ||||
Assets: | ||||
Available-for-sale equity securities | 30 | 27 | ||
Recurring basis | Quoted prices in active markets for identical assets (Level 1) | Investments in equity securities | ||||
Assets: | ||||
Available-for-sale equity securities | 3 | 18 | ||
Recurring basis | Significant other observable inputs (Level 2) | Interest rate contracts | ||||
Liabilities: | ||||
Total liabilities | $ (1) | (2) | ||
Recurring basis | Significant unobservable inputs (Level 3) | ||||
Assets: | ||||
Total assets | 29 | |||
Recurring basis | Significant unobservable inputs (Level 3) | Cross currency interest rate contracts | ||||
Assets: | ||||
Derivatives | $ 29 |
FAIR VALUE - INSTRUMENTS MEASUR
FAIR VALUE - INSTRUMENTS MEASURED AT FAIR VALUE ON A RECURRING BASIS USING SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3) AND INSTRUMENTS MEASURED AT FAIR VALUE ON A NON-RECURRING BASIS (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Total (losses) gains: | ||||
Impairment of long-lived assets | $ 0 | $ 0 | $ 0 | $ 0 |
Other comprehensive income (loss). | ||||
Total (losses) gains: | ||||
Changes in unrealized losses | (9) | (5) | (22) | (7) |
Cross currency interest rate contracts | ||||
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) | ||||
Balance at beginning of period | 16 | 26 | 29 | 28 |
Total (losses) gains: | ||||
Included in other comprehensive income (loss) | (9) | (5) | (22) | (7) |
Purchases, sales, issuances and settlements | $ (7) | $ (7) | ||
Balance at end of period | $ 21 | $ 21 |
EMPLOYEE BENEFIT PLANS (Details
EMPLOYEE BENEFIT PLANS (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Components of net periodic benefit cost | ||||
Amortization of actuarial loss | $ 19 | $ 14 | $ 55 | $ 42 |
Contributions to pension and other postretirement benefit plans | 80 | 38 | ||
Expected contributions to pension and other postretirement benefit plans during remainder of 2017 | 17 | |||
Huntsman International | ||||
Components of net periodic benefit cost | ||||
Amortization of actuarial loss | 20 | 15 | 57 | 44 |
Defined Benefit Plans | ||||
Components of net periodic benefit cost | ||||
Service cost | 16 | 15 | 47 | 44 |
Interest cost | 20 | 22 | 59 | 67 |
Expected return on plan assets | (39) | (37) | (116) | (111) |
Amortization of prior service credit | (2) | (2) | (5) | (7) |
Amortization of actuarial loss | 19 | 15 | 56 | 43 |
Special termination benefits | 1 | |||
Net periodic benefit cost | 14 | 13 | 42 | 36 |
Defined Benefit Plans | Huntsman International | ||||
Components of net periodic benefit cost | ||||
Service cost | 16 | 15 | 47 | 44 |
Interest cost | 20 | 22 | 59 | 67 |
Expected return on plan assets | (39) | (37) | (116) | (111) |
Amortization of prior service credit | (2) | (2) | (5) | (7) |
Amortization of actuarial loss | 20 | 16 | 58 | 45 |
Special termination benefits | 1 | |||
Net periodic benefit cost | 15 | 14 | 44 | 38 |
Other Postretirement Benefit Plans | ||||
Components of net periodic benefit cost | ||||
Service cost | 1 | 1 | 2 | 2 |
Interest cost | 1 | 1 | 3 | 3 |
Amortization of prior service credit | (2) | (2) | (5) | (5) |
Amortization of actuarial loss | 1 | 2 | 1 | |
Net periodic benefit cost | 1 | 2 | 1 | |
Other Postretirement Benefit Plans | Huntsman International | ||||
Components of net periodic benefit cost | ||||
Service cost | 1 | 1 | 2 | 2 |
Interest cost | 1 | 1 | 3 | 3 |
Amortization of prior service credit | (2) | $ (2) | (5) | (5) |
Amortization of actuarial loss | 1 | 2 | 1 | |
Net periodic benefit cost | $ 1 | $ 2 | $ 1 |
COMMON STOCK DIVIDENDS (Details
COMMON STOCK DIVIDENDS (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
DIVIDENDS ON COMMON STOCK | ||||||||
Cash dividends paid | $ 30 | $ 30 | $ 30 | $ 30 | $ 30 | $ 30 | $ 90 | $ 90 |
Cash dividends paid (in dollars per share) | $ 0.125 | $ 0.125 | $ 0.125 | $ 0.125 | $ 0.125 | $ 0.125 | $ 0.375 | $ 0.375 |
OTHER COMPREHENSIVE INCOME (L57
OTHER COMPREHENSIVE INCOME (LOSS) - COMPONENTS AND CHANGES IN ACCUMULATED OTHER COMPREHENSIVE LOSS - HUNTSMAN CORPORATION (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | $ 1,467 | $ 1,629 | $ 1,629 | |||
Other comprehensive income (loss), net of tax | $ 83 | $ 30 | 253 | 22 | ||
Balance at the end of the period | 2,591 | 1,771 | 2,591 | 1,771 | 1,467 | $ 1,629 |
Total | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | (1,707) | (1,316) | (1,316) | |||
Other comprehensive (loss) income before reclassifications, gross | 176 | (20) | ||||
Tax benefit | 30 | 7 | ||||
Amounts reclassified from accumulated other comprehensive loss, gross | 52 | 40 | ||||
Tax expense | (5) | (5) | ||||
Other comprehensive income (loss), net of tax | 22 | |||||
Net current-period other comprehensive income (loss) | 253 | |||||
Balance at the end of the period | (1,454) | (1,294) | (1,454) | (1,294) | (1,707) | (1,316) |
Foreign currency translation adjustment | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | (459) | (288) | (288) | |||
Other comprehensive (loss) income before reclassifications, gross | 170 | (18) | ||||
Tax benefit | 31 | 7 | ||||
Other comprehensive income (loss), net of tax | (11) | |||||
Net current-period other comprehensive income (loss) | 201 | |||||
Balance at the end of the period | (258) | (299) | (258) | (299) | (459) | (288) |
Foreign currency translation adjustment, tax | 69 | 83 | 100 | 90 | ||
Pension and other postretirement benefits adjustments | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | (1,275) | (1,056) | (1,056) | |||
Amounts reclassified from accumulated other comprehensive loss, gross | 21 | 13 | 60 | 40 | ||
Tax expense | (3) | (2) | (5) | (5) | ||
Other comprehensive income (loss), net of tax | 35 | |||||
Net current-period other comprehensive income (loss) | 55 | |||||
Balance at the end of the period | (1,220) | (1,021) | (1,220) | (1,021) | (1,275) | (1,056) |
Pension and other postretirement benefits adjustments, tax | 172 | 130 | 177 | 135 | ||
Other comprehensive income of unconsolidated affiliates | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | 4 | 11 | 11 | |||
Other comprehensive (loss) income before reclassifications, gross | (1) | (8) | ||||
Other comprehensive income (loss), net of tax | (8) | |||||
Net current-period other comprehensive income (loss) | (1) | |||||
Balance at the end of the period | 3 | 3 | 3 | 3 | 4 | 11 |
Other, net | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | 23 | 17 | 17 | |||
Other comprehensive (loss) income before reclassifications, gross | 7 | 6 | ||||
Tax benefit | (1) | |||||
Amounts reclassified from accumulated other comprehensive loss, gross | (8) | |||||
Other comprehensive income (loss), net of tax | 6 | |||||
Net current-period other comprehensive income (loss) | (2) | |||||
Balance at the end of the period | 21 | 23 | 21 | 23 | 23 | 17 |
Amounts attributable to noncontrolling interests | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | 36 | 28 | 28 | |||
Other comprehensive (loss) income before reclassifications, gross | (12) | |||||
Net current-period other comprehensive income (loss) | (12) | |||||
Disposition of a portion of P and A Business | 72 | |||||
Balance at the end of the period | 96 | 28 | 96 | 28 | 36 | 28 |
Accumulated other comprehensive loss | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | (1,671) | (1,288) | (1,288) | |||
Other comprehensive (loss) income before reclassifications, gross | 164 | (20) | ||||
Tax benefit | 30 | 7 | ||||
Amounts reclassified from accumulated other comprehensive loss, gross | 52 | 40 | ||||
Tax expense | (5) | (5) | ||||
Other comprehensive income (loss), net of tax | 313 | 22 | ||||
Net current-period other comprehensive income (loss) | 241 | |||||
Disposition of a portion of P and A Business | 72 | |||||
Balance at the end of the period | $ (1,358) | $ (1,266) | $ (1,358) | $ (1,266) | $ (1,671) | $ (1,288) |
OTHER COMPREHENSIVE INCOME (L58
OTHER COMPREHENSIVE INCOME (LOSS) - RECLASSIFICATION DETAILS - HUNTSMAN CORPORATION (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Pension and other postretirement benefits adjustments | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | $ 21 | $ 13 | $ 60 | $ 40 |
Income tax expense | (3) | (2) | (5) | (5) |
Net of tax | 18 | 11 | 55 | 35 |
Prior service credit | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | (4) | (4) | (11) | (12) |
Actuarial loss | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | 25 | 17 | 71 | 52 |
Actuarial loss | Discontinued Operations | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | $ 6 | $ 4 | $ 18 | $ 11 |
OTHER COMPREHENSIVE INCOME (L59
OTHER COMPREHENSIVE INCOME (LOSS) - COMPONENTS AND CHANGES IN ACCUMULATED OTHER COMPREHENSIVE LOSS - HUNTSMAN INTERNATIONAL (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Components of other comprehensive loss | ||||||
Other comprehensive income (loss), net of tax | $ 83 | $ 30 | $ 253 | $ 22 | ||
Huntsman International | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | 936 | 1,084 | $ 1,084 | |||
Other comprehensive income (loss), net of tax | 104 | 32 | 277 | 27 | ||
Balance at the end of the period | 2,055 | 1,234 | 2,055 | 1,234 | 936 | $ 1,084 |
Total | ||||||
Components of other comprehensive loss | ||||||
Other comprehensive (loss) income before reclassifications, gross | 176 | (20) | ||||
Tax benefit | 30 | 7 | ||||
Amounts reclassified from accumulated other comprehensive loss, gross | 52 | 40 | ||||
Tax expense | (5) | (5) | ||||
Other comprehensive income (loss), net of tax | 22 | |||||
Net current-period other comprehensive income (loss) | 253 | |||||
Total | Huntsman International | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | (1,727) | (1,344) | (1,344) | |||
Other comprehensive (loss) income before reclassifications, gross | 176 | (20) | ||||
Tax benefit | 29 | 7 | ||||
Amounts reclassified from accumulated other comprehensive loss, gross | 57 | 46 | ||||
Contribution of other comprehensive income from Parent | 20 | |||||
Tax expense | (5) | (6) | ||||
Other comprehensive income (loss), net of tax | 27 | |||||
Net current-period other comprehensive income (loss) | 277 | |||||
Balance at the end of the period | (1,450) | (1,317) | (1,450) | (1,317) | (1,727) | (1,344) |
Foreign currency translation adjustment | ||||||
Components of other comprehensive loss | ||||||
Other comprehensive (loss) income before reclassifications, gross | 170 | (18) | ||||
Tax benefit | 31 | 7 | ||||
Other comprehensive income (loss), net of tax | (11) | |||||
Net current-period other comprehensive income (loss) | 201 | |||||
Foreign currency translation adjustment, tax | 69 | 83 | 100 | 90 | ||
Foreign currency translation adjustment | Huntsman International | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | (462) | (292) | (292) | |||
Other comprehensive (loss) income before reclassifications, gross | 169 | (18) | ||||
Tax benefit | 30 | 7 | ||||
Other comprehensive income (loss), net of tax | (11) | |||||
Net current-period other comprehensive income (loss) | 199 | |||||
Balance at the end of the period | (263) | (303) | (263) | (303) | (462) | (292) |
Foreign currency translation adjustment, tax | 56 | 69 | 86 | 76 | ||
Pension and other postretirement benefits adjustments | ||||||
Components of other comprehensive loss | ||||||
Amounts reclassified from accumulated other comprehensive loss, gross | 21 | 13 | 60 | 40 | ||
Tax expense | (3) | (2) | (5) | (5) | ||
Other comprehensive income (loss), net of tax | 35 | |||||
Net current-period other comprehensive income (loss) | 55 | |||||
Pension and other postretirement benefits adjustments, tax | 172 | 130 | 177 | 135 | ||
Pension and other postretirement benefits adjustments | Huntsman International | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | (1,286) | (1,074) | (1,074) | |||
Amounts reclassified from accumulated other comprehensive loss, gross | 22 | 16 | 65 | 46 | ||
Contribution of other comprehensive income from Parent | 20 | |||||
Tax expense | (3) | (2) | (5) | (6) | ||
Other comprehensive income (loss), net of tax | 40 | |||||
Net current-period other comprehensive income (loss) | 80 | |||||
Balance at the end of the period | (1,206) | (1,034) | (1,206) | (1,034) | (1,286) | (1,074) |
Pension and other postretirement benefits adjustments, tax | 200 | 157 | 205 | 163 | ||
Other comprehensive income of unconsolidated affiliates | ||||||
Components of other comprehensive loss | ||||||
Other comprehensive (loss) income before reclassifications, gross | (1) | (8) | ||||
Other comprehensive income (loss), net of tax | (8) | |||||
Net current-period other comprehensive income (loss) | (1) | |||||
Other comprehensive income of unconsolidated affiliates | Huntsman International | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | 4 | 11 | 11 | |||
Other comprehensive (loss) income before reclassifications, gross | (1) | (8) | ||||
Other comprehensive income (loss), net of tax | (8) | |||||
Net current-period other comprehensive income (loss) | (1) | |||||
Balance at the end of the period | 3 | 3 | 3 | 3 | 4 | 11 |
Other, net | ||||||
Components of other comprehensive loss | ||||||
Other comprehensive (loss) income before reclassifications, gross | 7 | 6 | ||||
Tax benefit | (1) | |||||
Amounts reclassified from accumulated other comprehensive loss, gross | (8) | |||||
Other comprehensive income (loss), net of tax | 6 | |||||
Net current-period other comprehensive income (loss) | (2) | |||||
Other, net | Huntsman International | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | 17 | 11 | 11 | |||
Other comprehensive (loss) income before reclassifications, gross | 8 | 6 | ||||
Tax benefit | (1) | |||||
Amounts reclassified from accumulated other comprehensive loss, gross | (8) | |||||
Other comprehensive income (loss), net of tax | 6 | |||||
Net current-period other comprehensive income (loss) | (1) | |||||
Balance at the end of the period | 16 | 17 | 16 | 17 | 17 | 11 |
Amounts attributable to noncontrolling interests | ||||||
Components of other comprehensive loss | ||||||
Other comprehensive (loss) income before reclassifications, gross | (12) | |||||
Net current-period other comprehensive income (loss) | (12) | |||||
Disposition of a portion of P and A Business | 72 | |||||
Amounts attributable to noncontrolling interests | Huntsman International | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | 36 | 28 | 28 | |||
Other comprehensive (loss) income before reclassifications, gross | (12) | |||||
Net current-period other comprehensive income (loss) | (12) | |||||
Disposition of a portion of P and A Business | 72 | |||||
Balance at the end of the period | 96 | 28 | 96 | 28 | 36 | 28 |
Accumulated other comprehensive loss | ||||||
Components of other comprehensive loss | ||||||
Other comprehensive (loss) income before reclassifications, gross | 164 | (20) | ||||
Tax benefit | 30 | 7 | ||||
Amounts reclassified from accumulated other comprehensive loss, gross | 52 | 40 | ||||
Tax expense | (5) | (5) | ||||
Other comprehensive income (loss), net of tax | 313 | 22 | ||||
Net current-period other comprehensive income (loss) | 241 | |||||
Disposition of a portion of P and A Business | 72 | |||||
Accumulated other comprehensive loss | Huntsman International | ||||||
Components of other comprehensive loss | ||||||
Balance at the beginning of the period | (1,691) | (1,316) | (1,316) | |||
Other comprehensive (loss) income before reclassifications, gross | 164 | (20) | ||||
Tax benefit | 29 | 7 | ||||
Amounts reclassified from accumulated other comprehensive loss, gross | 57 | 46 | ||||
Contribution of other comprehensive income from Parent | 20 | |||||
Tax expense | (5) | (6) | ||||
Other comprehensive income (loss), net of tax | 337 | 27 | ||||
Net current-period other comprehensive income (loss) | 265 | |||||
Disposition of a portion of P and A Business | 72 | |||||
Balance at the end of the period | $ (1,354) | $ (1,289) | $ (1,354) | $ (1,289) | $ (1,691) | $ (1,316) |
OTHER COMPREHENSIVE INCOME (L60
OTHER COMPREHENSIVE INCOME (LOSS) - RECLASSIFICATION DETAILS - HUNTSMAN INTERNATIONAL (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Pension and other postretirement benefits adjustments | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | $ 21 | $ 13 | $ 60 | $ 40 |
Income tax expense | (3) | (2) | (5) | (5) |
Net of tax | 18 | 11 | 55 | 35 |
Pension and other postretirement benefits adjustments | Huntsman International | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | 22 | 16 | 65 | 46 |
Income tax expense | (3) | (2) | (5) | (6) |
Net of tax | 19 | 14 | 60 | 40 |
Prior service credit | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | (4) | (4) | (11) | (12) |
Prior service credit | Huntsman International | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | (4) | (4) | (11) | (12) |
Actuarial loss | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | 25 | 17 | 71 | 52 |
Actuarial loss | Discontinued Operations | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | 6 | 4 | 18 | 11 |
Actuarial loss | Huntsman International | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | 26 | 20 | 76 | 58 |
Actuarial loss | Huntsman International | Discontinued Operations | ||||
Reclassification from accumulated other comprehensive loss | ||||
Total before tax | $ 6 | $ 4 | $ 18 | $ 11 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - LEGAL MATTERS (Details) - 9 months ended Sep. 30, 2017 € in Millions, $ in Millions | EUR (€) | USD ($) | USD ($) |
Product Delivery Claim | |||
LEGAL MATTERS | |||
Maximum amount of claims of customer | € 153 | $ 179 | |
Aggregate amount of current claims | 113 | 132 | |
Minimum threshold amount for insured liability | $ 10 | ||
Accrued liability relating to the cases | $ 0 | ||
Product Delivery Claim | Minimum | |||
LEGAL MATTERS | |||
Possible loss | € | 0 | ||
Product Delivery Claim | Maximum | |||
LEGAL MATTERS | |||
Possible loss | € 113 | 132 | |
Indemnification Matters | |||
LEGAL MATTERS | |||
Accrued liability relating to the cases | $ 0 |
ENVIRONMENTAL, HEALTH AND SAF62
ENVIRONMENTAL, HEALTH AND SAFETY MATTERS (Details) $ in Millions | 9 Months Ended | ||
Sep. 30, 2017USD ($)item | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | |
Environmental, Health, and Safety Matters | |||
Capital expenditures for EHS matters | $ 23 | $ 33 | |
Accrued environmental liabilities | 22 | $ 22 | |
Accrued environmental liabilities, classified as accrued liabilities | 4 | 7 | |
Accrued environmental liabilities, classified as other noncurrent liabilities | $ 18 | $ 15 | |
Maximum period for payment of remediation liabilities | 30 years | ||
Number of former facilities or third party sites with claims against the entity for cleanup liabilities | item | 6 | ||
West Footscray | |||
Environmental, Health, and Safety Matters | |||
Accrued environmental liabilities | $ 15 |
STOCK-BASED COMPENSATION PLAN -
STOCK-BASED COMPENSATION PLAN - COMPENSATION COST AND STOCK OPTIONS (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | May 05, 2016 | |
STOCK-BASED COMPENSATION PLAN | |||||
Authorized number of shares to be granted under the Stock Incentive Plan | 8,200,000 | 8,200,000 | 8,200,000 | ||
Remaining shares available for grant | 8,000,000 | 8,000,000 | |||
Compensation cost from continuing operations | $ 8 | $ 7 | $ 25 | $ 23 | |
Total income tax benefit recognized in the statements of operations for stock-based compensation arrangements | $ 6 | $ 5 | |||
the "Prior Plan" | |||||
STOCK-BASED COMPENSATION PLAN | |||||
Remaining shares available for grant | 0 | ||||
Stock options | |||||
Weighted average of the assumptions utilized for stock options granted | |||||
Dividend yield (as a percent) | 3.30% | 2.40% | 5.60% | ||
Expected volatility (as a percent) | 57.60% | 56.90% | 57.90% | ||
Risk-free interest rate (as a percent) | 1.10% | 2.00% | 1.40% | ||
Expected life of stock options granted during the period | 5 years 10 months 24 days | 5 years 10 months 24 days | 5 years 10 months 24 days | ||
Shares | |||||
Outstanding at the beginning of the period (in shares) | 11,245,000 | ||||
Granted (in shares) | 0 | 997,000 | |||
Exercised (in shares) | (2,118,000) | ||||
Forfeited (in shares) | (59,000) | ||||
Converted to Venator awards (in shares) | (417,000) | ||||
Outstanding at the end of the period (in shares) | 9,648,000 | 9,648,000 | |||
Exercisable at the end of the period (in shares) | 6,822,000 | 6,822,000 | |||
Weighted Average Exercise Price | |||||
Outstanding at the beginning of the period (in dollars per share) | $ 13.37 | ||||
Granted (in dollars per share) | 21.04 | ||||
Exercised (in dollars per share) | 17.59 | ||||
Forfeited (in dollars per share) | 17.39 | ||||
Converted to Venator awards (in dollars per share) | 5 | ||||
Outstanding at the end of the period (in dollars per share) | $ 13.17 | 13.17 | |||
Exercisable at the end of the period (in dollars per share) | $ 12.88 | $ 12.88 | |||
Outstanding, Weighted Average Remaining Contractual Term | 5 years 8 months 12 days | ||||
Exercisable, Weighted Average Remaining Contractual Term | 4 years 7 months 6 days | ||||
Outstanding, Aggregate Intrinsic Value | $ 137 | $ 137 | |||
Exercisable, Aggregate Intrinsic Value | 99 | $ 99 | |||
Weighted-average grant-date fair value of stock options granted (in dollars per share) | $ 9.26 | ||||
Total unrecognized compensation cost | 11 | $ 11 | |||
Weighted-average period over which cost is expected to be recognized | 1 year 10 months 24 days | ||||
Total intrinsic value of stock options exercised | $ 11 | $ 0 | |||
Cash received from stock options exercised | 22 | 0 | |||
Tax benefit from stock options exercised | $ 3 | 0 | |||
Stock options | Maximum | |||||
STOCK-BASED COMPENSATION PLAN | |||||
Contractual term | 10 years | ||||
Stock-based awards | |||||
STOCK-BASED COMPENSATION PLAN | |||||
Vesting period | 3 years | ||||
Huntsman International | |||||
STOCK-BASED COMPENSATION PLAN | |||||
Compensation cost from continuing operations | $ 8 | $ 7 | $ 24 | 22 | |
Total income tax benefit recognized in the statements of operations for stock-based compensation arrangements | $ 6 | $ 5 |
STOCK-BASED COMPENSATION PLAN64
STOCK-BASED COMPENSATION PLAN - NONVESTED SHARES (Details) - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Performance Awards | ||
STOCK-BASED COMPENSATION PLAN | ||
Weighted-average volatility rate | 45.00% | 39.30% |
Risk-free interest rate (as a percent) | 1.50% | 0.90% |
Performance Awards | Maximum | ||
Additional information | ||
Performance period | 3 years | 3 years |
Equity Awards | ||
Shares | ||
Nonvested at the beginning of the period (in shares) | 2,996,000 | |
Granted (in shares) | 779,000 | |
Vested (in shares) | (937,000) | |
Forfeited (in shares) | (21,000) | |
Converted to Venator awards (in shares) | (237,000) | |
Nonvested at the end of the period (in shares) | 2,580,000 | |
Weighted Average Grant-Date Fair Value | ||
Nonvested at the beginning of the period (in dollars per share) | $ 13.36 | |
Granted (in dollars per share) | 22.60 | |
Vested (in dollars per share) | 16.30 | |
Forfeited (in dollars per share) | 15.23 | |
Converted to Venator awards (Weighted average exercise price) | 11.81 | |
Nonvested at the end of the period (in dollars per share) | $ 14.92 | |
Liability Awards | ||
Shares | ||
Nonvested at the beginning of the period (in shares) | 912,000 | |
Granted (in shares) | 285,000 | |
Vested (in shares) | (370,000) | |
Forfeited (in shares) | (32,000) | |
Converted to Venator awards (in shares) | (93,000) | |
Nonvested at the end of the period (in shares) | 702,000 | |
Weighted Average Grant-Date Fair Value | ||
Nonvested at the beginning of the period (in dollars per share) | $ 12.27 | |
Granted (in dollars per share) | 21.01 | |
Vested (in dollars per share) | 14.11 | |
Forfeited (in dollars per share) | 12.37 | |
Converted to Venator awards (Weighted average exercise price) | 13.72 | |
Nonvested at the end of the period (in dollars per share) | $ 14.66 | |
Restricted stock units | ||
Shares | ||
Vested (in shares) | (25,704) | |
Additional information | ||
Units vested but not yet issued | 460,750 | |
Nonvested shares | ||
Additional information | ||
Total unrecognized compensation cost | $ 32 | |
Weighted-average period over which cost is expected to be recognized | 1 year 10 months 24 days | |
Value of share awards vested | $ 20 | $ 15 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
INCOME TAXES | ||||
Net increase (decrease) in unrecognized tax benefits with a corresponding income tax expense | $ 7 | $ 3 | ||
Income tax liability due to tax gain from Venator IPO proceeds, net of expenses | $ 45 | 45 | ||
Income tax expense | 35 | $ 6 | $ 78 | 65 |
Effective tax rate (as a percent) | 18.00% | |||
Italy | Polyurethanes | ||||
INCOME TAXES | ||||
Release of valuation allowance | $ 7 | |||
Luxembourg | ||||
INCOME TAXES | ||||
Release of valuation allowance | 13 | |||
Huntsman International | ||||
INCOME TAXES | ||||
Income tax expense | $ 34 | $ 7 | $ 77 | $ 65 |
Effective tax rate (as a percent) | 18.00% |
NET INCOME PER SHARE - BASIC AN
NET INCOME PER SHARE - BASIC AND DILUTED INCOME PER SHARE (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Basic and diluted income from continuing operations: | ||||
Income from continuing operations attributable to Huntsman Corporation | $ 84 | $ 31 | $ 289 | $ 210 |
Basic and diluted net income: | ||||
Net income attributable to Huntsman Corporation | $ 147 | $ 55 | $ 390 | $ 198 |
Shares (denominator): | ||||
Weighted average shares outstanding | 238.5 | 236.3 | 238 | 236.2 |
Dilutive shares: | ||||
Stock-based awards (in shares) | 5.5 | 3.8 | 5.5 | 2.9 |
Total weighted average shares outstanding, including dilutive shares | 244 | 240.1 | 243.5 | 239.1 |
NET INCOME PER SHARE - INFORMAT
NET INCOME PER SHARE - INFORMATION ON STOCK-BASED AWARDS (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Stock-based awards | ||||
Antidilutive shares not included in the computation of income (loss) per share | ||||
Weighted average equivalent shares | 0.9 | 5.5 | 1.8 | 5.9 |
OPERATING SEGMENT INFORMATION -
OPERATING SEGMENT INFORMATION - FINANCIAL INFORMATION BY SEGMENT (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)segment | Sep. 30, 2016USD ($) | |
OPERATING SEGMENT INFORMATION | ||||
Number of reportable segments | segment | 4 | |||
Revenues | $ 2,169 | $ 1,831 | $ 6,155 | $ 5,614 |
Segment adjusted EBITDA | 340 | 234 | 899 | 787 |
Reconciliation of adjusted EBITDA to net income: | ||||
Interest expense | (39) | (52) | (134) | (153) |
Interest (expense) income - discontinued operations | (8) | (8) | 1 | |
Income tax expense | (35) | (6) | (78) | (65) |
Income tax (expense) benefit-discontinued operations | (17) | 7 | (41) | 8 |
Depreciation and amortization - continuing operations | (80) | (83) | (235) | (238) |
Depreciation and amortization - discontinued operations | (9) | (30) | (68) | (84) |
Net income attributable to noncontrolling interests | 32 | 9 | 64 | 22 |
Other adjustments: | ||||
Business acquisition and integration expenses | (10) | (6) | (17) | (11) |
Merger costs | (12) | (18) | ||
EBITDA from discontinued operations | 97 | 47 | 218 | 63 |
Minority interest of discontinued operations | (12) | (3) | (18) | (8) |
Loss on early extinguishment of debt | (35) | (1) | (36) | (3) |
Certain legal settlements and related expenses | (1) | |||
Gain on sale of assets | 8 | |||
Amortization of pension and postretirement actuarial losses | (19) | (14) | (55) | (42) |
Plant incident remediation costs | (13) | (13) | ||
Restructuring, impairment and plant closing and transition costs | (1) | (38) | (13) | (57) |
Net income | 179 | 64 | 454 | 220 |
Operating segments | Polyurethanes | ||||
OPERATING SEGMENT INFORMATION | ||||
Revenues | 1,197 | 891 | 3,172 | 2,703 |
Segment adjusted EBITDA | 245 | 137 | 556 | 439 |
Operating segments | Performance Products | ||||
OPERATING SEGMENT INFORMATION | ||||
Revenues | 501 | 509 | 1,595 | 1,611 |
Segment adjusted EBITDA | 63 | 70 | 249 | 248 |
Operating segments | Advanced Materials | ||||
OPERATING SEGMENT INFORMATION | ||||
Revenues | 263 | 247 | 782 | 774 |
Segment adjusted EBITDA | 56 | 55 | 166 | 173 |
Operating segments | Textile Effects | ||||
OPERATING SEGMENT INFORMATION | ||||
Revenues | 193 | 184 | 586 | 567 |
Segment adjusted EBITDA | 19 | 17 | 64 | 59 |
Corporate and eliminations | ||||
OPERATING SEGMENT INFORMATION | ||||
Revenues | 15 | 20 | (41) | |
Corporate and Other | ||||
OPERATING SEGMENT INFORMATION | ||||
Segment adjusted EBITDA | (43) | (45) | (136) | (132) |
Huntsman International | ||||
OPERATING SEGMENT INFORMATION | ||||
Revenues | 2,169 | 1,831 | 6,155 | 5,614 |
Segment adjusted EBITDA | 342 | 236 | 903 | 791 |
Reconciliation of adjusted EBITDA to net income: | ||||
Interest expense | (44) | (55) | (146) | (162) |
Interest (expense) income - discontinued operations | (8) | (8) | 1 | |
Income tax expense | (34) | (7) | (77) | (65) |
Income tax (expense) benefit-discontinued operations | (17) | 7 | (41) | 8 |
Depreciation and amortization - continuing operations | (78) | (79) | (227) | (228) |
Depreciation and amortization - discontinued operations | (9) | (30) | (68) | (84) |
Net income attributable to noncontrolling interests | 32 | 9 | 64 | 22 |
Other adjustments: | ||||
Business acquisition and integration expenses | (10) | (6) | (17) | (11) |
Merger costs | (12) | (18) | ||
EBITDA from discontinued operations | 96 | 45 | 215 | 58 |
Minority interest of discontinued operations | (12) | (3) | (18) | (8) |
Loss on early extinguishment of debt | (35) | (1) | (36) | (3) |
Certain legal settlements and related expenses | (1) | |||
Gain on sale of assets | 8 | |||
Amortization of pension and postretirement actuarial losses | (20) | (15) | (57) | (44) |
Restructuring, impairment and plant closing and transition costs | (1) | (38) | (13) | (57) |
Net income | 177 | 63 | 450 | 218 |
Huntsman International | Operating segments | Polyurethanes | ||||
OPERATING SEGMENT INFORMATION | ||||
Segment adjusted EBITDA | 245 | 137 | 556 | 439 |
Huntsman International | Operating segments | Performance Products | ||||
OPERATING SEGMENT INFORMATION | ||||
Segment adjusted EBITDA | 63 | 70 | 249 | 248 |
Huntsman International | Operating segments | Advanced Materials | ||||
OPERATING SEGMENT INFORMATION | ||||
Segment adjusted EBITDA | 56 | 55 | 166 | 173 |
Huntsman International | Operating segments | Textile Effects | ||||
OPERATING SEGMENT INFORMATION | ||||
Segment adjusted EBITDA | 19 | 17 | 64 | 59 |
Huntsman International | Corporate and Other | ||||
OPERATING SEGMENT INFORMATION | ||||
Segment adjusted EBITDA | $ (41) | $ (43) | $ (132) | $ (128) |
CONDENSED CONSOLIDATING FINAN69
CONDENSED CONSOLIDATING FINANCIAL INFORMATION - HUNTSMAN INTERNATIONAL - CONDENSED CONSOLIDATING BALANCE SHEETS (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Dec. 31, 2015 | |||
Current assets: | |||||||
Cash and cash equivalents | $ 440 | [1] | $ 385 | [1] | $ 236 | ||
Restricted cash | [1] | 11 | 11 | ||||
Accounts and notes receivable, net | [1] | 1,223 | 1,168 | ||||
Accounts receivable from affiliates | 24 | 15 | |||||
Inventories | [1] | 1,084 | 918 | ||||
Prepaid expenses | 47 | 49 | |||||
Other current assets | [1] | 193 | 232 | ||||
Current assets held for sale | 2,745 | 777 | |||||
Total current assets | 5,767 | 3,555 | |||||
Property, plant and equipment, net | [1] | 3,035 | 3,034 | ||||
Investment in unconsolidated affiliates | 255 | 248 | |||||
Intangible assets, net | [1] | 56 | 43 | ||||
Goodwill | 139 | 121 | |||||
Deferred income taxes | 268 | 253 | |||||
Noncurrent assets held for sale | 1,463 | ||||||
Other noncurrent assets | [1] | 463 | 472 | ||||
Total assets | 9,983 | 9,189 | |||||
Current liabilities: | |||||||
Accounts payable | [1] | 871 | 774 | ||||
Accounts payable to affiliates | 20 | 16 | |||||
Accrued liabilities | [1] | 537 | 471 | ||||
Current portion of debt | [1] | 29 | 50 | ||||
Current liabilities held for sale | 1,633 | 467 | |||||
Total current liabilities | 3,090 | 1,778 | |||||
Long-term debt | [1] | 2,845 | 4,122 | ||||
Notes payable to affiliates | 1 | ||||||
Deferred income taxes | 426 | 371 | |||||
Other noncurrent liabilities | [1] | 1,031 | 1,057 | ||||
Noncurrent liabilities held for sale | 393 | ||||||
Total liabilities | 7,392 | 7,722 | |||||
Huntsman International LLC members' equity | |||||||
Accumulated (deficit) income | (48) | (325) | |||||
Accumulated other comprehensive (loss) income | (1,358) | (1,671) | |||||
Total liabilities and equity | $ 9,983 | 9,189 | |||||
Huntsman International | |||||||
Condensed consolidating balance sheets | |||||||
Ownership interest (as a percent) | 100.00% | ||||||
Current assets: | |||||||
Cash and cash equivalents | $ 438 | [1] | 384 | [1] | 236 | ||
Restricted cash | [1] | 11 | 11 | ||||
Accounts and notes receivable, net | [1] | 1,222 | 1,168 | ||||
Accounts receivable from affiliates | 353 | 329 | |||||
Inventories | [1] | 1,084 | 918 | ||||
Prepaid expenses | 46 | 49 | |||||
Other current assets | [1] | 193 | 227 | ||||
Current assets held for sale | 2,745 | 777 | |||||
Total current assets | 6,092 | 3,863 | |||||
Property, plant and equipment, net | [1] | 3,031 | 3,012 | ||||
Investment in unconsolidated affiliates | 255 | 248 | |||||
Intangible assets, net | [1] | 57 | 43 | ||||
Goodwill | 139 | 121 | |||||
Deferred income taxes | 268 | 253 | |||||
Noncurrent assets held for sale | 1,463 | ||||||
Other noncurrent assets | [1] | 464 | 472 | ||||
Total assets | 10,306 | 9,475 | |||||
Current liabilities: | |||||||
Accounts payable | [1] | 871 | 773 | ||||
Accounts payable to affiliates | 67 | 51 | |||||
Accrued liabilities | [1] | 538 | 468 | ||||
Notes payable to affiliates | 100 | 100 | |||||
Current portion of debt | [1] | 29 | 50 | ||||
Current liabilities held for sale | 1,633 | 467 | |||||
Total current liabilities | 3,238 | 1,909 | |||||
Long-term debt | [1] | 2,845 | 4,122 | ||||
Notes payable to affiliates | 717 | 697 | |||||
Deferred income taxes | 421 | 367 | |||||
Other noncurrent liabilities | [1] | 1,030 | 1,051 | ||||
Noncurrent liabilities held for sale | 393 | ||||||
Total liabilities | 8,251 | 8,539 | |||||
Huntsman International LLC members' equity | |||||||
Members' equity | 3,412 | 3,226 | |||||
Accumulated (deficit) income | (483) | (779) | |||||
Accumulated other comprehensive (loss) income | (1,354) | (1,691) | |||||
Total Huntsman International LLC members' equity | 1,575 | 756 | |||||
Noncontrolling interests in subsidiaries | 480 | 180 | |||||
Total equity | 2,055 | 936 | $ 1,234 | 1,084 | |||
Total liabilities and equity | 10,306 | 9,475 | |||||
Reportable legal entities | Huntsman International | Parent Company | |||||||
Current assets: | |||||||
Cash and cash equivalents | 56 | 37 | 44 | ||||
Accounts and notes receivable, net | 36 | 22 | |||||
Accounts receivable from affiliates | 873 | 1,351 | |||||
Inventories | 81 | 85 | |||||
Prepaid expenses | 18 | 68 | |||||
Other current assets | 735 | 820 | |||||
Total current assets | 1,799 | 2,383 | |||||
Property, plant and equipment, net | 451 | 463 | |||||
Investment in unconsolidated affiliates | 6,074 | 5,870 | |||||
Intangible assets, net | 27 | 28 | |||||
Goodwill | (14) | (12) | |||||
Deferred income taxes | 510 | 515 | |||||
Notes receivable from affiliates | 111 | 37 | |||||
Other noncurrent assets | 47 | 74 | |||||
Total assets | 9,005 | 9,358 | |||||
Current liabilities: | |||||||
Accounts payable | 60 | 63 | |||||
Accounts payable to affiliates | 3,783 | 3,667 | |||||
Accrued liabilities | 88 | 87 | |||||
Notes payable to affiliates | 100 | 100 | |||||
Current portion of debt | 5 | 30 | |||||
Total current liabilities | 4,036 | 3,947 | |||||
Long-term debt | 2,504 | 3,763 | |||||
Notes payable to affiliates | 717 | 696 | |||||
Deferred income taxes | 22 | ||||||
Other noncurrent liabilities | 173 | 174 | |||||
Total liabilities | 7,430 | 8,602 | |||||
Huntsman International LLC members' equity | |||||||
Members' equity | 3,412 | 3,226 | |||||
Accumulated (deficit) income | (483) | (779) | |||||
Accumulated other comprehensive (loss) income | (1,354) | (1,691) | |||||
Total Huntsman International LLC members' equity | 1,575 | 756 | |||||
Total equity | 1,575 | 756 | |||||
Total liabilities and equity | 9,005 | 9,358 | |||||
Reportable legal entities | Huntsman International | Guarantors | |||||||
Current assets: | |||||||
Accounts and notes receivable, net | 73 | 88 | |||||
Accounts receivable from affiliates | 4,213 | 4,589 | |||||
Inventories | 201 | 183 | |||||
Prepaid expenses | 6 | 46 | |||||
Other current assets | 3 | 3 | |||||
Total current assets | 4,496 | 4,909 | |||||
Property, plant and equipment, net | 1,111 | 1,163 | |||||
Investment in unconsolidated affiliates | 2,302 | 1,458 | |||||
Goodwill | 82 | 82 | |||||
Notes receivable from affiliates | 565 | 620 | |||||
Other noncurrent assets | 172 | 188 | |||||
Total assets | 8,728 | 8,420 | |||||
Current liabilities: | |||||||
Accounts payable | 175 | 152 | |||||
Accounts payable to affiliates | 537 | 645 | |||||
Accrued liabilities | 825 | 787 | |||||
Total current liabilities | 1,537 | 1,584 | |||||
Deferred income taxes | 281 | 257 | |||||
Other noncurrent liabilities | 268 | 300 | |||||
Total liabilities | 2,086 | 2,141 | |||||
Huntsman International LLC members' equity | |||||||
Members' equity | 2,256 | 2,949 | |||||
Accumulated (deficit) income | 2,908 | 2,332 | |||||
Accumulated other comprehensive (loss) income | 1,478 | 998 | |||||
Total Huntsman International LLC members' equity | 6,642 | 6,279 | |||||
Total equity | 6,642 | 6,279 | |||||
Total liabilities and equity | 8,728 | 8,420 | |||||
Reportable legal entities | Huntsman International | Nonguarantors | |||||||
Current assets: | |||||||
Cash and cash equivalents | 382 | 347 | $ 192 | ||||
Restricted cash | 11 | 11 | |||||
Accounts and notes receivable, net | 1,108 | 1,053 | |||||
Accounts receivable from affiliates | 122 | 149 | |||||
Inventories | 808 | 652 | |||||
Prepaid expenses | 31 | 36 | |||||
Other current assets | 195 | 129 | |||||
Current assets held for sale | 2,745 | 777 | |||||
Total current assets | 5,402 | 3,154 | |||||
Property, plant and equipment, net | 1,469 | 1,385 | |||||
Investment in unconsolidated affiliates | 255 | 245 | |||||
Intangible assets, net | 30 | 15 | |||||
Goodwill | 71 | 51 | |||||
Deferred income taxes | 280 | 265 | |||||
Noncurrent assets held for sale | 1,463 | ||||||
Other noncurrent assets | 245 | 210 | |||||
Total assets | 7,752 | 6,788 | |||||
Current liabilities: | |||||||
Accounts payable | 631 | 553 | |||||
Accounts payable to affiliates | 602 | 1,499 | |||||
Accrued liabilities | 375 | 420 | |||||
Current portion of debt | 24 | 20 | |||||
Current liabilities held for sale | 1,633 | 467 | |||||
Total current liabilities | 3,265 | 2,959 | |||||
Long-term debt | 341 | 359 | |||||
Notes payable to affiliates | 676 | 658 | |||||
Deferred income taxes | 66 | 19 | |||||
Other noncurrent liabilities | 589 | 577 | |||||
Noncurrent liabilities held for sale | 393 | ||||||
Total liabilities | 4,937 | 4,965 | |||||
Huntsman International LLC members' equity | |||||||
Members' equity | 3,484 | 5,019 | |||||
Accumulated (deficit) income | 166 | (1,713) | |||||
Accumulated other comprehensive (loss) income | (1,304) | (1,652) | |||||
Total Huntsman International LLC members' equity | 2,346 | 1,654 | |||||
Noncontrolling interests in subsidiaries | 469 | 169 | |||||
Total equity | 2,815 | 1,823 | |||||
Total liabilities and equity | 7,752 | 6,788 | |||||
Eliminations | Huntsman International | |||||||
Current assets: | |||||||
Accounts and notes receivable, net | 5 | 5 | |||||
Accounts receivable from affiliates | (4,855) | (5,760) | |||||
Inventories | (6) | (2) | |||||
Prepaid expenses | (9) | (101) | |||||
Other current assets | (740) | (725) | |||||
Total current assets | (5,605) | (6,583) | |||||
Property, plant and equipment, net | 1 | ||||||
Investment in unconsolidated affiliates | (8,376) | (7,325) | |||||
Deferred income taxes | (522) | (527) | |||||
Notes receivable from affiliates | (676) | (657) | |||||
Total assets | (15,179) | (15,091) | |||||
Current liabilities: | |||||||
Accounts payable | 5 | 5 | |||||
Accounts payable to affiliates | (4,855) | (5,760) | |||||
Accrued liabilities | (750) | (826) | |||||
Total current liabilities | (5,600) | (6,581) | |||||
Notes payable to affiliates | (676) | (657) | |||||
Deferred income taxes | 74 | 69 | |||||
Total liabilities | (6,202) | (7,169) | |||||
Huntsman International LLC members' equity | |||||||
Members' equity | (5,740) | (7,968) | |||||
Accumulated (deficit) income | (3,074) | (619) | |||||
Accumulated other comprehensive (loss) income | (174) | 654 | |||||
Total Huntsman International LLC members' equity | (8,988) | (7,933) | |||||
Noncontrolling interests in subsidiaries | 11 | 11 | |||||
Total equity | (8,977) | (7,922) | |||||
Total liabilities and equity | $ (15,179) | $ (15,091) | |||||
[1] | At September 30, 2017 and December 31, 2016, respectively, $35 and $20 of cash and cash equivalents, $11 and $10 of restricted cash, $29 and $21 of accounts and notes receivable (net), $42 and $45 of inventories, $6 and $5 of other current assets, $272 and $279 of property, plant and equipment (net), $10 each of intangible assets (net), $39 and $37 of other noncurrent assets, $81 and $89 of accounts payable, $29 and $30 of accrued liabilities, $20 and $12 of current portion of debt, $94 and $114 of longterm debt, and $80 and $76 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See “Note 5. Variable Interest Entities.” |
CONDENSED CONSOLIDATING FINAN70
CONDENSED CONSOLIDATING FINANCIAL INFORMATION - HUNTSMAN INTERNATIONAL - CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Revenues: | ||||
Trade sales, services and fees, net | $ 2,137 | $ 1,802 | $ 6,048 | $ 5,519 |
Related party sales | 32 | 29 | 107 | 95 |
Total revenues | 2,169 | 1,831 | 6,155 | 5,614 |
Cost of goods sold | 1,695 | 1,475 | 4,852 | 4,444 |
Gross profit | 474 | 356 | 1,303 | 1,170 |
Selling, general and administrative | 198 | 185 | 583 | 564 |
Research and development | 35 | 34 | 103 | 103 |
Restructuring, impairment and plant closing (credits) costs | 1 | 38 | 13 | 56 |
Merger costs | 12 | 18 | ||
Other operating expense (income), net | 5 | (2) | (9) | (3) |
Operating income | 223 | 101 | 595 | 450 |
Interest (expense) income | (39) | (52) | (134) | (153) |
Equity in income of investment in affiliates and subsidiaries | 1 | 1 | 4 | 4 |
Loss on early extinguishment of debt | (35) | (1) | (36) | (3) |
Other income (loss), net | 1 | (3) | 2 | (1) |
Income from continuing operations before income taxes | 151 | 46 | 431 | 297 |
Income tax benefit (expense) | (35) | (6) | (78) | (65) |
Income from continuing operations | 116 | 40 | 353 | 232 |
Income (loss) from discontinued operations, net of tax | 63 | 24 | 101 | (12) |
Net income | 179 | 64 | 454 | 220 |
Net income attributable to noncontrolling interests | (32) | (9) | (64) | (22) |
Net income attributable to Huntsman Corporation or Huntsman International LLC | 147 | 55 | 390 | 198 |
Other comprehensive income | 83 | 30 | 253 | 22 |
Comprehensive income attributable to noncontrolling interests | (37) | (9) | (76) | (22) |
Comprehensive income attributable to Huntsman Corporation or Huntsman International LLC | 225 | 85 | 631 | 220 |
Huntsman International | ||||
Revenues: | ||||
Trade sales, services and fees, net | 2,137 | 1,802 | 6,048 | 5,519 |
Related party sales | 32 | 29 | 107 | 95 |
Total revenues | 2,169 | 1,831 | 6,155 | 5,614 |
Cost of goods sold | 1,694 | 1,474 | 4,849 | 4,441 |
Gross profit | 475 | 357 | 1,306 | 1,173 |
Selling, general and administrative | 197 | 184 | 579 | 561 |
Research and development | 35 | 34 | 103 | 103 |
Restructuring, impairment and plant closing (credits) costs | 1 | 38 | 13 | 56 |
Merger costs | 12 | 18 | ||
Other operating expense (income), net | 5 | (2) | (9) | (3) |
Operating income | 225 | 103 | 602 | 456 |
Interest (expense) income | (44) | (55) | (146) | (162) |
Equity in income of investment in affiliates and subsidiaries | 1 | 1 | 4 | 4 |
Loss on early extinguishment of debt | (35) | (1) | (36) | (3) |
Other income (loss), net | 2 | 5 | 5 | |
Income from continuing operations before income taxes | 149 | 48 | 429 | 300 |
Income tax benefit (expense) | (34) | (7) | (77) | (65) |
Income from continuing operations | 115 | 41 | 352 | 235 |
Income (loss) from discontinued operations, net of tax | 62 | 22 | 98 | (17) |
Net income | 177 | 63 | 450 | 218 |
Net income attributable to noncontrolling interests | (32) | (9) | (64) | (22) |
Net income attributable to Huntsman Corporation or Huntsman International LLC | 145 | 54 | 386 | 196 |
Other comprehensive income | 104 | 32 | 277 | 27 |
Comprehensive income attributable to noncontrolling interests | (37) | (9) | (76) | (22) |
Comprehensive income attributable to Huntsman Corporation or Huntsman International LLC | 244 | 86 | 651 | 223 |
Reportable legal entities | Huntsman International | Parent Company | ||||
Revenues: | ||||
Trade sales, services and fees, net | 296 | 264 | 824 | 787 |
Related party sales | 55 | 45 | 169 | 139 |
Total revenues | 351 | 309 | 993 | 926 |
Cost of goods sold | 275 | 249 | 792 | 726 |
Gross profit | 76 | 60 | 201 | 200 |
Selling, general and administrative | 34 | 33 | 129 | 117 |
Research and development | 12 | 13 | 35 | 35 |
Restructuring, impairment and plant closing (credits) costs | (3) | 2 | 1 | 5 |
Merger costs | 12 | 18 | ||
Other operating expense (income), net | 20 | 3 | 36 | 11 |
Operating income | 1 | 9 | (18) | 32 |
Interest (expense) income | (43) | (54) | (143) | (165) |
Equity in income of investment in affiliates and subsidiaries | 187 | 82 | 534 | 67 |
Loss on early extinguishment of debt | (35) | (1) | (36) | (3) |
Dividend income (expense) | 1 | 1 | 1 | 217 |
Other income (loss), net | (1) | (3) | (1) | (3) |
Income from continuing operations before income taxes | 110 | 34 | 337 | 145 |
Income tax benefit (expense) | 26 | 20 | 56 | 50 |
Income from continuing operations | 136 | 54 | 393 | 195 |
Income (loss) from discontinued operations, net of tax | 9 | (7) | 1 | |
Net income | 145 | 54 | 386 | 196 |
Net income attributable to Huntsman Corporation or Huntsman International LLC | 145 | 54 | 386 | 196 |
Other comprehensive income | 171 | 32 | 337 | 27 |
Comprehensive income attributable to Huntsman Corporation or Huntsman International LLC | 316 | 86 | 723 | 223 |
Reportable legal entities | Huntsman International | Guarantors | ||||
Revenues: | ||||
Trade sales, services and fees, net | 498 | 424 | 1,543 | 1,396 |
Related party sales | 75 | 64 | 248 | 222 |
Total revenues | 573 | 488 | 1,791 | 1,618 |
Cost of goods sold | 520 | 434 | 1,551 | 1,343 |
Gross profit | 53 | 54 | 240 | 275 |
Selling, general and administrative | 31 | 25 | 94 | 79 |
Research and development | 11 | 11 | 31 | 32 |
Restructuring, impairment and plant closing (credits) costs | 1 | 6 | 15 | |
Other operating expense (income), net | (8) | (8) | (33) | (28) |
Operating income | 18 | 20 | 148 | 177 |
Interest (expense) income | 7 | 7 | 20 | 24 |
Equity in income of investment in affiliates and subsidiaries | 180 | 80 | 453 | 183 |
Dividend income (expense) | (430) | |||
Other income (loss), net | 2 | 2 | ||
Income from continuing operations before income taxes | 207 | 107 | 623 | (46) |
Income tax benefit (expense) | (11) | (13) | (58) | (71) |
Income from continuing operations | 196 | 94 | 565 | (117) |
Income (loss) from discontinued operations, net of tax | (1) | (2) | (1) | |
Net income | 195 | 94 | 563 | (118) |
Net income attributable to Huntsman Corporation or Huntsman International LLC | 195 | 94 | 563 | (118) |
Other comprehensive income | 329 | 7 | 479 | 86 |
Comprehensive income attributable to Huntsman Corporation or Huntsman International LLC | 524 | 101 | 1,042 | (32) |
Reportable legal entities | Huntsman International | Nonguarantors | ||||
Revenues: | ||||
Trade sales, services and fees, net | 1,343 | 1,114 | 3,681 | 3,336 |
Related party sales | 255 | 231 | 772 | 700 |
Total revenues | 1,598 | 1,345 | 4,453 | 4,036 |
Cost of goods sold | 1,251 | 1,101 | 3,585 | 3,339 |
Gross profit | 347 | 244 | 868 | 697 |
Selling, general and administrative | 132 | 126 | 356 | 365 |
Research and development | 12 | 10 | 37 | 36 |
Restructuring, impairment and plant closing (credits) costs | 3 | 30 | 12 | 36 |
Other operating expense (income), net | (7) | 3 | (12) | 14 |
Operating income | 207 | 75 | 475 | 246 |
Interest (expense) income | (8) | (8) | (23) | (21) |
Equity in income of investment in affiliates and subsidiaries | 1 | 2 | 5 | 6 |
Dividend income (expense) | (1) | (2) | 430 | |
Other income (loss), net | 1 | 3 | 4 | 8 |
Income from continuing operations before income taxes | 200 | 70 | 461 | 669 |
Income tax benefit (expense) | (49) | (14) | (75) | (44) |
Income from continuing operations | 151 | 56 | 386 | 625 |
Income (loss) from discontinued operations, net of tax | 54 | 22 | 107 | (17) |
Net income | 205 | 78 | 493 | 608 |
Net income attributable to noncontrolling interests | (32) | (9) | (64) | (19) |
Net income attributable to Huntsman Corporation or Huntsman International LLC | 173 | 69 | 429 | 589 |
Other comprehensive income | 113 | 31 | 289 | 32 |
Comprehensive income attributable to noncontrolling interests | (36) | (6) | (70) | (11) |
Comprehensive income attributable to Huntsman Corporation or Huntsman International LLC | 282 | 103 | 712 | 629 |
Eliminations | Huntsman International | ||||
Revenues: | ||||
Related party sales | (353) | (311) | (1,082) | (966) |
Total revenues | (353) | (311) | (1,082) | (966) |
Cost of goods sold | (352) | (310) | (1,079) | (967) |
Gross profit | (1) | (1) | (3) | 1 |
Operating income | (1) | (1) | (3) | 1 |
Equity in income of investment in affiliates and subsidiaries | (367) | (163) | (988) | (252) |
Dividend income (expense) | 1 | (1) | (217) | |
Income from continuing operations before income taxes | (368) | (163) | (992) | (468) |
Income from continuing operations | (368) | (163) | (992) | (468) |
Net income | (368) | (163) | (992) | (468) |
Net income attributable to noncontrolling interests | (3) | |||
Net income attributable to Huntsman Corporation or Huntsman International LLC | (368) | (163) | (992) | (471) |
Other comprehensive income | (509) | (38) | (828) | (118) |
Comprehensive income attributable to noncontrolling interests | (1) | (3) | (6) | (11) |
Comprehensive income attributable to Huntsman Corporation or Huntsman International LLC | $ (878) | $ (204) | $ (1,826) | $ (597) |
CONDENSED CONSOLIDATING FINAN71
CONDENSED CONSOLIDATING FINANCIAL INFORMATION - HUNTSMAN INTERNATIONAL - CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | ||
Condensed consolidating statements of cash flows | |||
Net cash provided by operating activities from continuing operations | $ 538 | $ 736 | |
Net cash provided by operating activities from discontinued operations | 205 | 112 | |
Net cash provided by operating activities | 743 | 848 | |
Investing Activities: | |||
Capital expenditures | (159) | (214) | |
Acquisition of businesses, net of cash acquired | (14) | ||
Proceeds from sale of businesses/assets | 21 | ||
Cash received from termination of cross-currency interest rate contracts | 7 | ||
Change in restricted cash | 1 | ||
Other, net | 2 | ||
Net cash used in investing activities from continuing operations | (145) | (213) | |
Net cash used in investing activities from discontinued operations | (49) | (57) | |
Net cash provided by (used in) investing activities | (194) | (270) | |
Financing activities: | |||
Net repayments under revolving loan facilities | (36) | ||
Net repayments on overdraft facilities | (1) | ||
Repayments of short-term debt | (10) | (41) | |
Borrowings on short-term debt | 6 | 8 | |
Repayments of long-term debt | (1,439) | (795) | |
Proceeds from long-term debt of P and A Business | 750 | ||
Proceeds from issuance of long-term debt | 24 | 552 | |
Repayments of notes payable | (20) | (25) | |
Borrowings on notes payable | 11 | 31 | |
Debt issuance costs paid | (21) | (8) | |
Dividends paid to noncontrolling interests | (26) | (26) | |
Contribution from noncontrolling interests | 4 | ||
Proceeds from the IPO of P and A Business | 522 | ||
Cash paid for expenses of the IPO of P and A Business | (40) | ||
Other, net | 2 | 1 | |
Net cash used in financing activities | (349) | (397) | |
Net cash used in investing activities from discontinued operations | (49) | (57) | |
Effect of exchange rate changes on cash | 12 | 1 | |
Increase in cash and cash equivalents | 212 | 182 | |
Cash and cash equivalents from continuing operations at beginning of period | 385 | [1] | 236 |
Cash and cash equivalents from discontinued operations at beginning of period | 29 | 21 | |
Cash and cash equivalents at end of period | 626 | 439 | |
Huntsman International | |||
Condensed consolidating statements of cash flows | |||
Net cash provided by operating activities from continuing operations | 536 | 736 | |
Net cash provided by operating activities from discontinued operations | 202 | 107 | |
Net cash provided by operating activities | 738 | 843 | |
Investing Activities: | |||
Capital expenditures | (159) | (214) | |
Investment in affiliate | (2) | ||
Acquisition of businesses, net of cash acquired | (14) | ||
Proceeds from sale of businesses/assets | 21 | ||
(Increase) decrease in receivable from affiliate | (3) | 3 | |
Cash received from termination of cross-currency interest rate contracts | 7 | ||
Change in restricted cash | 1 | ||
Other, net | 1 | 2 | |
Net cash used in investing activities from continuing operations | (147) | (210) | |
Net cash used in investing activities from discontinued operations | (49) | (57) | |
Net cash provided by (used in) investing activities | (196) | (267) | |
Financing activities: | |||
Net repayments under revolving loan facilities | (36) | ||
Net repayments on overdraft facilities | (1) | ||
Repayments of short-term debt | (10) | (41) | |
Borrowings on short-term debt | 6 | 8 | |
Repayments of long-term debt | (1,439) | (795) | |
Proceeds from long-term debt of P and A Business | 750 | ||
Proceeds from issuance of long-term debt | 24 | 552 | |
Repayments of notes payable to affiliate | (1) | ||
Proceeds from issuance of notes payable from affiliate | 21 | ||
Repayments of notes payable | (20) | (25) | |
Borrowings on notes payable | 11 | 31 | |
Debt issuance costs paid | (21) | (8) | |
Dividends paid to noncontrolling interests | (26) | (26) | |
Contribution from noncontrolling interests | 4 | ||
Dividends paid to parent | (90) | (90) | |
Proceeds from the IPO of P and A Business | 522 | ||
Cash paid for expenses of the IPO of P and A Business | (40) | ||
Other, net | 1 | 1 | |
Net cash used in financing activities | (343) | (395) | |
Net cash used in investing activities from discontinued operations | (49) | (57) | |
Effect of exchange rate changes on cash | 12 | 1 | |
Increase in cash and cash equivalents | 211 | 182 | |
Cash and cash equivalents from continuing operations at beginning of period | 384 | [1] | 236 |
Cash and cash equivalents from discontinued operations at beginning of period | 29 | 21 | |
Cash and cash equivalents at end of period | 624 | 439 | |
Noncash Capital Contribution Between Parent And Nonguarantor Entities | 215 | ||
Noncash capital contribution between Parent Company and Guarantor entities | 50 | ||
Reportable legal entities | Huntsman International | Parent Company | |||
Condensed consolidating statements of cash flows | |||
Net cash provided by operating activities from continuing operations | 274 | 410 | |
Net cash provided by operating activities from discontinued operations | (19) | ||
Net cash provided by operating activities | 255 | 410 | |
Investing Activities: | |||
Capital expenditures | (26) | (24) | |
Cash received from consolidated affiliates | 800 | ||
Investment in affiliate | (11) | ||
(Increase) decrease in receivable from affiliate | (3) | 3 | |
Cash received from termination of cross-currency interest rate contracts | 7 | ||
Other, net | 1 | ||
Net cash used in investing activities from continuing operations | 779 | (32) | |
Net cash provided by (used in) investing activities | 779 | (32) | |
Financing activities: | |||
Repayments of long-term debt | (1,416) | (774) | |
Proceeds from issuance of long-term debt | 547 | ||
Repayments of notes payable to affiliate | (7) | ||
Proceeds from issuance of notes payable from affiliate | 21 | ||
Repayments of notes payable | (20) | (23) | |
Borrowings on notes payable | 11 | 30 | |
Debt issuance costs paid | (3) | (8) | |
Dividends paid to parent | (90) | (89) | |
Proceeds from the IPO of P and A Business | 522 | ||
Cash paid for expenses of the IPO of P and A Business | (40) | ||
Other, net | 1 | ||
Net cash used in financing activities | (1,015) | (323) | |
Increase in cash and cash equivalents | 19 | 55 | |
Cash and cash equivalents from continuing operations at beginning of period | 37 | 44 | |
Cash and cash equivalents at end of period | 56 | 99 | |
Reportable legal entities | Huntsman International | Guarantors | |||
Condensed consolidating statements of cash flows | |||
Net cash provided by operating activities from continuing operations | 514 | 87 | |
Net cash provided by operating activities | 514 | 87 | |
Investing Activities: | |||
Capital expenditures | (37) | (66) | |
Investment in affiliate | (3) | ||
Other, net | 1 | ||
Net cash used in investing activities from continuing operations | (37) | (68) | |
Net cash provided by (used in) investing activities | (37) | (68) | |
Financing activities: | |||
Net repayments on overdraft facilities | (1) | ||
Contribution from parent | 3 | ||
Distribution to parent | (477) | (20) | |
Dividends paid to parent | (1) | ||
Net cash used in financing activities | (477) | (19) | |
Reportable legal entities | Huntsman International | Nonguarantors | |||
Condensed consolidating statements of cash flows | |||
Net cash provided by operating activities from continuing operations | (252) | 239 | |
Net cash provided by operating activities from discontinued operations | 221 | 107 | |
Net cash provided by operating activities | (31) | 346 | |
Investing Activities: | |||
Capital expenditures | (96) | (124) | |
Cash received from consolidated affiliates | (278) | ||
Investment in affiliate | (2) | ||
Acquisition of businesses, net of cash acquired | (14) | ||
Proceeds from sale of businesses/assets | 21 | ||
Change in restricted cash | 1 | ||
Other, net | 1 | ||
Net cash used in investing activities from continuing operations | (367) | (124) | |
Net cash used in investing activities from discontinued operations | (49) | (57) | |
Net cash provided by (used in) investing activities | (416) | (181) | |
Financing activities: | |||
Net repayments under revolving loan facilities | (36) | ||
Repayments of short-term debt | (10) | (41) | |
Borrowings on short-term debt | 6 | 8 | |
Repayments of long-term debt | (23) | (21) | |
Proceeds from long-term debt of P and A Business | 750 | ||
Proceeds from issuance of long-term debt | 24 | 5 | |
Proceeds from issuance of notes payable from affiliate | 6 | ||
Repayments of notes payable | (2) | ||
Borrowings on notes payable | 1 | ||
Debt issuance costs paid | (18) | ||
Dividends paid to noncontrolling interests | (26) | (26) | |
Contribution from noncontrolling interests | 4 | ||
Contribution from parent | 31 | ||
Distribution to parent | (45) | ||
Other, net | 1 | ||
Net cash used in financing activities | 627 | (39) | |
Net cash used in investing activities from discontinued operations | (49) | (57) | |
Effect of exchange rate changes on cash | 12 | 1 | |
Increase in cash and cash equivalents | 192 | 127 | |
Cash and cash equivalents from continuing operations at beginning of period | 347 | 192 | |
Cash and cash equivalents from discontinued operations at beginning of period | 29 | 21 | |
Cash and cash equivalents at end of period | 568 | 340 | |
Eliminations | Huntsman International | |||
Investing Activities: | |||
Cash received from consolidated affiliates | (522) | ||
Investment in affiliate | 14 | ||
Net cash used in investing activities from continuing operations | (522) | 14 | |
Net cash provided by (used in) investing activities | (522) | 14 | |
Financing activities: | |||
Repayments of notes payable to affiliate | 6 | ||
Proceeds from issuance of notes payable from affiliate | (6) | ||
Contribution from parent | (34) | ||
Distribution to parent | 522 | 20 | |
Net cash used in financing activities | $ 522 | $ (14) | |
[1] | At September 30, 2017 and December 31, 2016, respectively, $35 and $20 of cash and cash equivalents, $11 and $10 of restricted cash, $29 and $21 of accounts and notes receivable (net), $42 and $45 of inventories, $6 and $5 of other current assets, $272 and $279 of property, plant and equipment (net), $10 each of intangible assets (net), $39 and $37 of other noncurrent assets, $81 and $89 of accounts payable, $29 and $30 of accrued liabilities, $20 and $12 of current portion of debt, $94 and $114 of longterm debt, and $80 and $76 of other noncurrent liabilities from consolidated variable interest entities are included in the respective balance sheet captions above. See “Note 5. Variable Interest Entities.” |