Huntsman (HUN) 5 Nov 242024 Q3 Earnings call transcript

Company Profile

Participants

Ivan Marcuse	executive
Peter Huntsman	executive
David Begleiter	analyst
Jeffrey Zekauskas	analyst
Philip Lister	executive
Patrick Cunningham	analyst
Michael Sison	analyst
Vincent Andrews	analyst
Frank Mitsch	analyst
Joshua Spector	analyst
Aleksey Yefremov	analyst
Salvator Tiano	analyst
John Roberts	analyst
Hassan Ahmed	analyst
Kevin McCarthy	analyst
Michael Harrison	analyst
Arun Viswanathan	analyst
Daniel Rizzo	analyst

Call transcript

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Operator

Greetings, and welcome to Huntsman Corporation Third Quarter 2024 Earnings Conference Call. [Operator Instructions]

I would now like to turn the conference over to your host, Ivan Marcuse. Thank you.

You may begin.

Ivan Marcuse

good and Rob, you, morning, everyone. Thank Huntsman's to Third Quarter Call. Earnings XXXX Welcome

and us are Phil President; President today the Lister, Huntsman, Vice Joining call and Peter on Chairman, CEO Executive CFO. and

November website, X, November markets we huntsman.com. release of our released and last quarter Yesterday, for third via XXXX, closed, the -- earnings XXXX the U.S. after posted equity night, press to our

will set discussed our question-and-answer posted of a move of some Huntsman in website. third also detail then commentary call. slides the shortly, We and session comments on the quarter Peter will remainder and provide opening in for we the the to

are remind about reflect they statements, current We're going expectations guarantees and expectations, future. or our and and risks performance. they future not we statements may the are you our out uncertainties forward-looking projections of make and statements to while for call involve such that All

with the materially cause for on review SEC more the revising our should publicly these updating projections regarding from results filings actual do or statements expectations. or information not You quarter. during forward-looking We could plan the to that any factors differ

We will as or EBITDA, such and financial also non-GAAP income flow. net refer free cash measures loss adjusted adjusted to

find in to GAAP our to can which directly has posted financial most our comparable You reconciliations the measures been release, earnings website, huntsman.com.

CEO. I'll over Peter and now call Chairman the turn Huntsman, to

Peter Huntsman

join us for We've much, you line very morning. and thank time you this thank to taking quite Ivan, people for a all got questions. in few the

be brief. very So going to I'm just

the to focused where ended and quarter it fourth we're and on about third quarter The year-end. finish, expected now we

shaping move year-end. still number year X quarter from the of to positives and it's up be, to there's we expected a X we quarter to as be better While than

in and U.S. in As we economic change mentioned you will presidential are single dropping new to housing interest be an said for the many their our American both part most improvement during impactful improvement. earnings. see of that our I'm rates of and conferences, housing North construction heartened investor to candidates platform

between the another the seeing that growth continue hopeful of we're and now to rate end are will We today. cut improve the still anemic year

In MDI to exceeds over of rates that X the a traditional GDP interest more to the quarters, we've growth return growth. rate seen addition falling past

traction As was we demand we QX growth past have improve in we meaningful MDI rates right to margin capacity quarters, little disappointed expansion. get see increase our see said utilization is customers. growth the to recent need but price with moving see I demand direction, The in and before increases

very will board, inventories see continue increases rising the to across and price demand and low expansion. We eventually margin support

sold. Additionally, chemical are we assets, see we market. assets Europe, I if see that would all a surprised on of global of these record a are amount the in be especially -- personally number

actually money. So I imagine these of that are very making few

Given its to of Europe's energy I see well I to anytime a anti-growth may rid will desire manufacturing, soon. a much adherence and itself to which term, and see doubt We be Europe. change reflected a products policies, prospects the in consolidation think in combination needed cost high due regulatory close structures. facilities there chemical Longer of number regulatory in I of a number will of

Middle and out we'll as believe housing partners visiting their continue of relatively from opportunities that China, and across the Arabia bubbles, recently see returned customers Korea, continue and markets be to should year they in to But growth. gradual Malaysia, leaders, Asia grow. low and XXXX Saudi Having government conflicts East. seeing improvement I a are these sort

to supply We our operating look of all our continue production sites agreements and and structure, at examine cost rates.

over out in million to our reduction in business. the the million taken costs initiating years. a program be past will cost the $XX we few addition in year, $XXX company entire This we've the of end Polyurethanes the global For further is of

We standards manage and settled the insulation quarter. estimated in way battery home opportunities and strike, million which efficiency such cost growing an We'll tightening, through building EV fourth dollars challenges, recently energy few will materials. continue the to Boeing will in also our as capitalize on

early lower much say about While certainty XXXX, improving and to the inventories announcements, Asian interest too stimulus conditions. demand, pent-up all greater work rates, believe towards I market political Europe and in load will housing U.S.

don't With line the that, operator, questions? open we any up for why

Operator

David Our with Instructions] from Deutsche comes question Begleiter first Bank. [Operator

David Begleiter

of be closed you do in assets MDI Peter, iteration restructuring? in expect to Europe this

Peter Huntsman

David. sorry, I I Do get didn't expect? entire the I'm question.

David Begleiter

and assets expect restructurings closed MDI you this of iteration reviews? Do to be in in Europe

Peter Huntsman

Huntsman's Of restructuring?

David Begleiter

MDI assets. of no, No, competitors'

Peter Huntsman

what idea no have doing. simply our is competition I Look,

Asia, the capacities the recent the of flat look around look size MDI relatively the given I a world, I at and you there's curve Asia, construction in in of in As think relative cost Asia. curve cost the

I an a advantage it's flat But that think Wanhua simply an just has pretty of curve. the because enjoy. they scale integration cost

players that single-site all facilities, size I the so the a about have think similar you it's locations pretty have of U.S. in forth. handful same where and

certainly, got X to look U.S. raw everything and of But facilities, countries. costs, Europe. at the versus energy operate haven't all regulatory particularly I at across Europe, curve, surprised what else smaller on I'd and if operating. from costs, non-integrated year I a versus is facilities I you at multiple that material are here in But continues -- multiple Europe outlier on look any still competition. a look costs, we're sitting that as cost idea the again, and those, [indiscernible] across be goes multiple transportation again, very Europe that. And Asia the And costs, now, just smaller the or

David Begleiter

good. Can regions Polyurethanes, removed and cost that million. from? you new where Very $XX program, is functions your the being restructuring just detail And on

Peter Huntsman

these about Europe. be will a be years. will by about ought to looking a on quarter the be of months. is pretty basis cost going sort our that in of this rate centered automotive around typically detail -- as and to a programs, it in the of $XX at cost say next gained cost, savings fourth few be over of And -- year. our a call It next the Most end during giving The same Yes. be of But We'll by is you couple some million when to more construction. the savings. run this this majority much you're this safe the

there's about So or on a X-year X-year a give payback a this. quarter to -- take,

Operator

Our next Jeff JPMorgan. with question comes from Zekauskas

Jeffrey Zekauskas

JV quarter, you operations. more flow it In through China dividends dividend And I related from million to from source? take are went to there SLIC the that cash come received of $XX a the that acquisition. any

Philip Lister

Jeff. the venture. from Yes. Thanks $XX liquidation Chinese joint million the Correct. question, for of the

the recorded quarter of restructuring We're a year. in which during liquidated $XX flow, or of You'll simply process. million this below was of of the over And impacts about million. dividend, lifetime million through JV. we is the now reinjection. the $XX the out moving a that which RMB we've recall, that first as be free about we received the can that cash amount [indiscernible] liquidation did liquidate XXX left JV. over There's net of income capital that to quarter,

expect purposes. dividend. be impact as XXXX. cash We wouldn't a therefore, None that accounting And recorded will be of flow. free occur it for It can't during that to

Jeffrey Zekauskas

fourth in can -- the you terms of by region? for and in general in your describe volume quarter And MDI expectations your

Peter Huntsman

inventories forth. not on That's that about usually on typically, to try seasonal I'm trying this. so to year-end to -- are answer think at week next the middle this, November, people and start of direct and But depending evade much so stock two, the we XX cut to see in I how we'll and to working we'll inventory Jeff, a look as see decline. trying in XX and preserve a capital or just forth.

X year, in some ordering literally, people to and cases, And as this inventories take in weeks the of will see just will, start last they'll X their you down. the to stop

very you I Now are world is regions anecdotally, low. the as just MDI, that across But growth have of well. inventories where demand look some pretty anemic are you believe as -- inventories

on XX% I seasonality which see anywhere we global see XX%. basis, typically during So that think a we'll is, what to from

Operator

comes from next Our Citi. with Patrick Cunningham question

Patrick Cunningham

reflecting increases price expectations 'XX. into declines? rebuffed are XQ? by your were material you XQ prices terms raw region So mentioned are What in you in And what MDI for of

Peter Huntsman

that looking to look at I you look pretty bit the pricing there's if I prices spot a it's think [indiscernible]. cost market, at little spot tracking I Well, mean, look flat of at little bit and QX, Europe If flat. we and U.S., it's the in for benzene. MDI of pressure in in the down as upward the a

benzene, bit of gas by little probably a benefit poly, from that not up a be offset pick but will we'll prices. higher natural partially and flat -- but pricing think I So

Patrick Cunningham

you are and this absence adhesives. then in outperforming increases Performance Or in volume here? your Products, And market in destocking? you expectations? helpful. cited mostly line this Or with Was coatings Very the the of is sales construction,

Peter Huntsman

think the margins good Performance per right it's now, side on that we're strong. is Products, remained a in pound fairly I basis, -- the business about

issue business biggest see, around demand. other in you And is Our that again, like typically seasonality you businesses. there do

demand hopeful in seasonality But back after the And so see. typical see New we we'll that start with in particular. start be Chinese coming to will Year I'm the that it line the

Operator

from with Fargo. Wells comes Mike Sison Our next question

Michael Sison

forward? appropriate are or see in seeing think doesn't just need that getting to to volume sales earnings What volume business seem you polyurethane, for you for level do leverage The start kicking going Peter, leverage of or growth. EBITDA the be yet. you leverage to

Peter Huntsman

excellent that as we and one often well. question ask an quite It's ourselves

in As XXs. we capacity in start gets high getting we really leverage see when utilization the this market,

yet in the believe what that that XX, in world, in be early the expansion we've hit market year, to be and of operating we forth, rates XXXX. exactly seen mid and continue probably if that's sort in are all global seeing look the in determined. that be growth to this see some that XX, I past we Now we have I that XX, MDI the as and But we does believe around recovery pricing segment -- ought the of might so to demand margins to

North improve, that's last continuing we America -- of Again, in we're housing. it's year. coming very upon to were look, around off low a base But predicated demand where particularly of

the of we've that look I'm XXXX into happy But when the [indiscernible] the in I've out end got And also MDI. XXXX we to of of period, we need with additions seen capacity we time demand, market. that hole to XXXX. the what that So during to course, seen at and see get continue in

think in of hopeful I XXXX. post-Chinese the XXXX start construction as kick February, other the March start look see each start to in getting we Year's, that orders materially. off New we'll that as all frame up we picking into time I'm hopefully, So offsetting season,

Michael Sison

of sort know up follow-up consultants lot should quite A with margin next things Great. see cadence? outlook. on a type bit specific EBITDA you a potentially. give or Do in little it's quick you expanding power of of Polyurethanes to potential XXXX. I year? see think early do agree a if And pick the bit do that what And a you

Peter Huntsman

agree sanity with consumer a think, got of it energy what got behind. so I predicated margin element of sort that. of see I to I again to lot to an We to may see Asia some policy and around manufacturing return. of we confidence to we've we again, North mean, XXXX, housing because America sort in And forth. continues of in would going improvement And America of comes demand housing. about consumer a lag that's in Europe's because talked Europe China, return well some just expansion be to as about demand. and North when see see

U.S., do Middle lot capacity are couple based, of a other fundamentally the been particularly utilization Asia. moving automotive to seeing materials that traditionally European East we're of moving I that has probably and the to moving and that a to believe in

from other think that So I dislocation global seeing Europe a you regions. are to

before might take an place Europe. Asia North And in see America so you actually do and improvement you

not going sure an in regions to there's the necessarily seen we've past. if eventide simultaneously be in I'm So all as

Operator

from Our Vincent with Morgan next question Andrews comes Stanley.

Vincent Andrews

you Your prepared certainly, well, comments autos, it expected. wasn't what on

you for Advanced grow you had to it in volumes. Polyurethanes seem the Materials. and EU like And quarter autos looks were did also in stable better versus third You

extent sequential all the have particularly that, 'XX, into just So outlook a And just I you the weak the is how bit comment piece quarter. market seemed wonder to of to maybe on given fourth and that be of sort a view. the what if could you EU the

Philip Lister

the question. Phil. for Yes. This Thanks is

So auto indicate. X% was year-on-year as you It sequentially. down was up X%

a of slowing did we little bit So see quarter. a the during

Europe. About in XX% break world down our exposure XX% division portfolio. us. Polyurethanes auto, you for strong That definitely our is we Asia slowed been quarter and quarter into relatively come strong into for about America off into And third rest went through which and is we If of as a around About head relatively world. of into XX% that's the and little. our did And North America the as XX% XX% fourth North then here. the the

numbers. I at look we mean, look, the

We XX year million have last 'XX. in production builds

this think I of million XX about year. most the for forecast for

So pick to a Asia. whether a across agnostic platform. But up bit whether slower. we're -- little to down little bit it's In either hybrid or in it's whether us overall. pretty in general, general, able PV and for in general, are it's sales in But good ICE,

Vincent Andrews

I'd And your Peter, view rates. curious be if get up, on I could just to follow interest

for. haven't so end I down. the of come we're all seen as curve, had much think, hoped think back far, the But I we as on wanting help it to people

to look front end of than do maybe helps where And down pace you that -- if the where where that of as think a a get curve, comes do So back think end situation lot down we recovery? into more 'XX, slows the if think maybe you the you you? you the

Peter Huntsman

shopping Well, to has probably been on hit the it's that hit But consumer economy. both engine be the started on and confidence, to levers differential One, of that able smaller quarter. a economy. in Phil versus to we on consumer areas. the third and and are been to singularly U.S. spending. larger consumer for would be to of it's got around in been particularly the that And believe U.S. items, I confidence Europe, growth in the to there buying consider has got Yes, the -- Asia as I the spend consumer able U.S. as forth has confidence home in biggest money in lot be which consumer. so U.S. They the scale between scale, continue mentioned, a -- automotive,

one and talk keep interest you consumer to we stimulated rates mortgage about U.S. We the So coming the that to potential and one. when need rates, between again, need rates down bifurcation other that interest spending. and continue

our rates for demand. believe, to housing need I stimulate importantly, company, come More mortgage down to

Operator

Our Fermium next question with Frank Mitsch Research. comes from

Frank Mitsch

non-PU-based the saw of demand item a And a in capacity Peter, company expansion a insulation about doing targeting Europe. read and about market. future for chemical I news the European materials, materials positively recently release they're insulating

get see listened was there What's obviously as read far, prepared which the materials And so for very seem excited market? in when recovery to didn't insulating about there? I and would be Europe, obviously, you your that Now helpful might like remarks a much to we you. take on

Peter Huntsman

energy European tougher reality, the state most most countries do. the and In honest To would where be In Europe rather one has of one with legislating you Frank. with higher frustrated you, than probably on could every in proactive tell, be the with materials you of areas United I'm insulation prices, think construction would standards. areas States higher a as and conservation virtually Europe, standard energy

and put upside they So conserve that at -- looking want how I an Europe, policy, that start do energy as active get they and there. as much believe when their to you act some there's really real into together

in I think that we're position. sitting

we've We got have and polyurethane Europe polyols opportunity We and a in foam forth. we We blending technologies facilities there. don't make own spray in it our can so it can from our can Europe. make the And where utilize U.S. export own We real materials.

and to see without in the that regulatory been sort correct able I we've the environment, in that growth we inducements think But the of see incentives, want U.S. Europe don't to

Frank Mitsch

but given But are bottoming that's possible the in at to the more of your of And really in what -- kind about remarks, comments close is also EBITDA. Materials. your kind about helpful. obviously, of on was there Very elevated, leverage trough the levels is so yielding And or thoughts your prepared M&A Okay. Advanced stock looking given buybacks? X%,

Peter Huntsman

to And now, we we this, And But in the an have when about focused Board investment-grade first my then decision of more make that a preserve improvement the coming the strong -- share stay the keep a in dividend. between cash all, potential of in cash ratings. free be bit on that making. confident our cash we or free and recommendation to flow Board right speak We I'd I preserving behalf look, on little it's that feel dividend. sure free flow. I I'd the balance sheet. saying preserve well, have that And to to of is want would see flow, a divvy we'll Board feel We up the M&A. buybacks

Operator

Spector from next with UBS. Josh comes Our question

Joshua Spector

and of Europe was Europe. MDI ADNOC, that Europe. has kind kind intact apparent Huntsman? for an capacity Covestro them deal the Is in I improving that's to between on curious There's impediment market of keeping for

Peter Huntsman

I've not be whole no you're not to I so want idea regulators an answer. I'm do and your plans would that lot got want what you're trying -- going going planning. and -- not closing, to between I'm assume again, matter are, just to got evade ADNOC a that no and not unions signing to would Covestro what do your to forth. -- and antagonize I labor

keep that. is. kind I'm as -- just of speculating And at let's So but everything

to So do. no less equal, capacity, they're I've idea all planning I've what look, And see got things I'd want more being capacities. -- always to

Joshua Spector

Yes, no problem.

power when a think utilization is you've higher, maybe polyurethanes what margin are said when your achieve. you I about and talked you with can rates It's mid-teens think something in had but vein. to think I where close, I Europe guess stay a in thought was I would just move on. a sticking after place, few in that I'll different that there earnings you years just the past, something maybe

around China would lag probably Europe Europe with also like higher. versus to it your and demand U.S. costs are and seems guess commentary I

higher? Huntsman's if stay is, maybe costs a achieve that question answer there you isn't around power? framework the would change, guess earnings I you have Europe any industrial Or can different So

Peter Huntsman

whatever in up made be is I'd like in can Asia Europe think and to that lost America. North

path and a I we North uncompetitive capacity locations, think the in offset Americas regions might particularly on us cost it's if to give exist this if China, splitting where earn China, and than see opportunity of those continues that more in production to both now, well and more demand a any the those pound in excess demand, that we per higher move have America may structure it's we And have Europe downstream, Europe. in Asia. see downstream going particularly in structure greater to if

But the until I I of hits it's that dynamics. in global hits market of trade there's hits, think shift I'm just the reality and don't fundamentally believe pricing -- at point. and sort this been any speculating that those major But

Operator

question with KeyBanc Aleksey next comes Yefremov Our from Markets. Capital

Aleksey Yefremov

don't I about have In much I to big a say traditionally recall you wanted don't ask prepared as to well as to in contract pricing exposure you spot. exposure Peter, you MDI. have you But remarks, much your you tied just of materials leverage explain that in state of can business America? chunk of to what's benchmark raw we sort MDI contract your North the for pricing contract just to current observe -- Can passthrough. also

Peter Huntsman

Yes, on I think touch regions. X -- I'll just well, all

buckets. much ] in publications. read or -- just consider but I to sort will how of oversimplify But I and is put just X oftentimes is One it in these ISS -- me. want so you don't kind forgive [ let's what spot, and that's of So this,

would over to it's formulated which pricing, on around be is or other The a other to than That to it's of is one if the be and be just variable it's say, if pure I going product whatever, buckets pricing, pricing. one, -- MDI formula around, MDI going variable going place. depending more pricing, all X is or the

Europe XX% typically XX% you look it's materials, So about [ XX% at around in China. if in ] Europe, and spot

basis And That's pricing. In to part, be to it going be that's customer that. it's in globally. of As most than the be for to you That will -- be of And look splitter, forward the bucket [indiscernible]. China, what's formula by the on is XX%. lesser that. lesser of pricing, than be that's customer. then formulations going that's around It's on pricing will our going be out to Europe, to going be in contract. a around at is to XX% preponderantly on that total just to throughput into a little America volume customer going And customer. negotiated variable it a on Very side, third is going North be coming that

to So read that's kind I think published do too people buckets have of into much X probably the a pricing. tendency

a the the is got pricing it's think probably that ethylene, some regional that or But of all place. unlike traded, are other the just MDI, chemicals I benzene you to indicator. it macro of over good which is and remember

Aleksey Yefremov

I best Very some are some helpful, losing -- polyurethanes In PU. in your European traditionally These biggest appears automotive business, Peter. customers, are How mean, are OEMs change that your of are right, it share. OEMs after sort sort customers addressing you strategy in changing this elsewhere? sea in in the auto China the you of and of How going of world? emerging your terms

Peter Huntsman

very strong -- Europe U.S. Asia. and the I have we Well, fortunately, regional platforms think in

other a seating, that the these Korea Today, in probably but than we like years that insulation, anything batteries in materials, auto It also in so just I did EVs our X we with Asia. a and stronger stronger traditional to than Asia. can made not with China sound years be -- in in X Hyundai the from did we more forth, the the the ago, X relationships getting and into think regions we to forth. ASEAN, just relationship have in BYD in and applications and more now with The Asian, so the money applications, European ago, about combined. platforms used said are probably be regional

As global the than the Asia, businesses the of We our automotive XX% in only money. more do combined. money regions in of other we in at. make rest we That's world, Asia more we look at make

rest the are there continue think move the the business, automotive think, the and But I Asia, very and into at and so a currents water, there between markets at to U.S. of Europe forth. between So look lot that fast-moving I world. EV, think to And look are I ICE we're us. under it the and be global Latin we doing we EV going our to, as very of trades again, Chinese stable very America rapidly are continues for -- as

that have rest very to we ICE how think EV platforms be and continue I that's to organized But address address good formations. to assured and And and been regional we've will the organized.

Operator

question of Salvator next Our America. from with Tiano Bank comes

Salvator Tiano

splitter on year, so firstly, mentioned believe earlier new Peter, the So the you your before EBITDA contract Geismar, by contract in really that base. any said far. wasn't the adding I you

stand do why that? what where So And started XXXX expect And the for on splitter? should not, we right it we Has contributing? now? if is

Philip Lister

Yes, Sal.

So America from we well. full really investment North a is be benefits brought bit in splitter quite consumer such get the the to that to What perspective splitter on efforts of needs as a Geismar. to furniture, areas happen return stronger also a at obviously needs as

still [indiscernible] needs of over the be the It's all up that benefit all which lot about. from on the and that spoke substantially splitter order It's stronger And really to to We our consumer investment. a side, some around to That's that timing. happen ends issue. confidence time. around expect consumer not Peter that in

really $XX furniture benefit. develops If automotive dependent maybe you [indiscernible] $XX develop. think about But year-on-year next how market upon million develops, our that's to as how well as million year, how

Salvator Tiano

a stimulus prop home I If don't guess, and existing the on be they because market. housing new bit little a guess check to anything, construction new wanted the measures. But prices. there's I necessarily a end stock also seem incentivizing really especially Chinese seem I market, stock to to And they Perfect. boost, new to Okay.

you MDI bit U.S. end versus your talk think Polyurethanes business? and we when about So your little there, European can differ and about markets your they a how business and

Peter Huntsman

building side for. a Well, in again, it benefit so for Again, spending of market, in the are I very see consumer housing. When and it's China. an a the -- automotive rather think -- we you and We're look pretty of installation has much that's residential material very there area a and side growing fast-growing been in market small it at China, we anemic forth, us. of

infrastructure also or -- when a outside build-out spent insulation, large well. central heating, some of central of you also maintenance, polyurethanes as and obviously the forth, pipeline in road electrical We the in projects, so sell think other infrastructure. water bit about maintenance quite That's areas

large those to look in are that. we But projects as that we across a going see of continue lot China, at demand

infrastructure So look into were we look earlier to be good so growth And we recovery in in in area this Asia. some and But we We're furniture, the elastomers the again, that as asked China. seeing And will housing of and good our obviously hopefully forth. to going comments, it's some a in spending be my of for a us, coatings, China. to both spending, automotive gradual market as that -- that as the in lot adhesives, going very markets in Asian for right market. now in in catalyst be that it's start appliances, consumer XXXX, see kind just has slow knock-on But effect. recovery

Operator

question Securities. Roberts next from John comes with Mizuho Our

John Roberts

think you Harris versus have election will Trump impact Peter, on Huntsman? any do since day, win it's

Peter Huntsman

as XX% look, No, Donald Trump. Donald versus be Trump. I definitely I Trump or it's of not mean, to for against mean, voting really. I I either going are the voting probably think Donald people

going or housing be Trump see something major But similar that really at beyond. that economy wins in and to needs So out, pretty have the kind election. it loses the catalyst 'XX is look U.S. really Donald to views, to candidates, of interesting you which it, when be think both a come going you I will keep be as to

both a lines I'm probably last been conservation and high sure is And tariffs along that's the the of of Tariffs to any as over be years. very their surprisingly, Biden going number change trade not put And both that energy of X much rhetoric on as those tariffs. in going Trump lists.

So tariffs, the housing I between pretty think common energy conservation, two. probably

the IRA some there's forth, think Chevron the that and and regulation how There's actually our taxes, carbon and how ruling and that. so a split obviously differences on forth. tax impacts I real corporate on so -- industry

I is has debt either GDP. the our of is spite unfortunately, in address as couple the a don't years. to GDP XXX-pound national of in exceeding the growing candidate And as first the is, which And our for beginning time, which rapidly last gorilla think it room, that's

here see outcome I changing the of so. materially plan course don't -- them our next year the one So any either of or of business over

Frank Mitsch

Okay. XXXX? a but turnaround more for your lower then And bit set you maybe level yet question, plans little have

Peter Huntsman

believe of I that front that us. in have sure that have we -- I'm right I not

of that got have Rotterdam, whole variety I turnaround. I on at at think do is call that we what time. site quarter, plants But the come things chemical end that as down the cluster look same a called we cluster. been there, first very the the of the large one we've at there's believe, It's docket you all our X, word X involving the the

-- the of None until first one last when one the operate us down, can one the up. shuts starts last

week quarter is and we're planning delays maybe or a at may somewhere X. timing And set we so leak next to in record and the the by everything year. of a and go when first a be of have somebody's small end have right one ready pipeline that now, that turnaround for maintenance we -- But kind of a

Operator

Hassan Our from Ahmed Global. Alembic comes next question with

Hassan Ahmed

is the of assets look, permanently put and story correctly, the a of asked if virtues you shut an mean, I of bunch going just like. some of at the obviously but to you're as assets if restructuring oligopoly, towards the polyurethane to guys, it wanted least go one European these your were And been, of I comments the heard on, right? down. it's that sale back up bore questions being sounds leaning has Not for about to sort obviously being

So like consolidated industry? looking the is sort about relatively what you question, you mean, do understand buying have I those Covestro my players there and ADNOC, Asian I up how But guess, otherwise that state of and players out is at different or and fragmenting coming the a deal, like, I assets no idea company and thinking. think obviously players ADNOC other

Peter Huntsman

facility, question, good that just if new an facility production really from decide anywhere being very in one, the even probably years opposition time that somewhere, company, Middle to given they mean, to the chemical decide very another you're East addition to at to you looking they would a forth. in it the Well, in I X changes the or a of existing away in having changed it's many site, I name see X large-scale ADNOC ADNOC. build to a take build the a between to I'm one build you're Covestro, so dynamics. yes, complicated Hassan, sense. one mean, not the -- if If and in it's that sure

those place So deal changes a -- a really ADNOC-Covestro I'm took dynamics, I'm company. not whole not sure unless splintering that that of you that saw really sure any. the

Hassan Ahmed

it think And Fair enough, of about a because I'm has fair quite times, trying a well. inventory COVID enough. as of the corporates' changed been potential since holding to of and to But complex. how back Obviously, for going question appetite the seems also lockdowns the mean, has seems I dramatically just patterns restocking. couple it out should changed now inventories. last figure one demand sort around COVID like. years inventory

of So of how of in does of some about potential pulls restock moving sort moving maybe think sort lean about light of direction. a thought think of about that inventories sort one keeping and potentially of with these mean, vis-a-vis in a one restock all and maybe companies' tugs I sort thoughts? does how processes demand these sort

Peter Huntsman

-- out we question, Well, of excellent came Hassan.

many we I inventories thought, high. there do inventory think typically they very obviously of And and of strong, companies was like was sort out with these areas the forever. people is So And in demand capital large of the amounts cheap are world, were a -- COVID that was had continue these going in around relatively that busted to chain while came times, supply things

look I when degrees at environment it's today, think XXX that you the difference.

up. capital Capital of expensive. want up or anemic be don't People seems tie in areas Demand now to is the It's to world. of inventory a lot king.

volatile until in there's seen of of point I restocking. spite of say picking course -- of up, East conflicts for So you I all have shouldn't And over the relatively been last the a forth, lot so prices no the that and energy the on year that, And relatively market terribly flat stable why Middle a or haven't see keep inventory? in They've been demand flat. way. well, last in top so. And

lot happen, demand genuine there's chemical until sure build more I when that if restocking. there's a the supply. So not in will that up though needs and a region, be to particular industry usually time I'm our that going to predict does widespread

drop a would usually North saw off or a a housing take If you supply of of to which that's get that you, chains quarter sudden, go a prices, in causes what X, X are rates period. all up gradually typically over and takes these all time America, normally And X going. sudden interest quarter

in of or All spikes X it a sudden, quarters. up X

and mismatch catalyst So quickly takes how that. between that buying restocking and the there's usually a place actual causes that panic

Operator

Vertical question next Research Our from comes with Kevin McCarthy Partners.

Kevin McCarthy

speak maleic you you in they how bilaterally MDI escalate anhydride scenario to how between? might that were to and evolve can perhaps flows and Peter, trade in see if today international tariffs

Peter Huntsman

Yes.

and probably think or few a and pretty XX% MDI give much on they'll tariff, The maleic way remain are other the points, about has products. U.S. number on a they a I of take today.

bit. on certain importing I going off. filed in tariffs And them coming see so your you I see or in roof. are might up those a cases today, and them -- the through go see forth, disappearing people up some so recently Depending necessarily that products don't don't

continue of so. around they'll flows But European have a moving in product the single in the exception to largely all of they're with site, for of China the has with from obviously do the trade the Wanhua exception most But years world. of production They and China, that I producers the produce. in flow MDI other most from with and the see is products deal of the to MDI have region that that same regional we production, maleic I trade And a would one next. true great the not with say of probably as continuing. of there's

that to I people than on think There nonetheless, with see a overcapacity are staying you China. that, maleic maleic. for in That would a be is for would material say lot biodegradable the in quite what was of raw be the China a exception of I over most some little most spilling coming Europe. anticipated. But is that's stream that of I region. than other products slower plastic But maleic bit think within supposed into

Operator

Seaport next with question Our Harrison Mike from Research comes Partners.

Michael Harrison

foam some today occurring I about in to markets? in? position years what to North compared update just competitive maybe spray they are few And talk a that ago. insulation markets you wins those you wrap versus mentioned You your America can within few improved speak construction, in new Polyurethanes. and I ago? can an construction years on also if insulation guess, adoption are if specifically was Has business wondering, Maybe a in

Peter Huntsman

kind be construction, we -- the In if Yes. mostly it's you market the into insulation I to X buckets, of to going and would that will. construction. One going and say in into see we construction, wood OSB what in is goes see what

positions positions, just have very selling solutions I think selling but we that we're also positions, not the we're stable and customers. -- in both to of those molecules,

forth. say, would and so I in be furniture would also appliances area, third The and

a lot some applications, supply lot into that also on of low-end big into of a goes But MDI construction markets good others the necessarily that out don't generally. And but material market others. for areas and we appliances of construction. bucket that it's product that are drain for While And for takes construction, third do. of goes OSB. of when MDI kind we sucks the furniture of about it the a of in housing other lot talking Huntsman Oftentimes, aren't we're a focus up

Michael Harrison

catalysts. capacity a on, expansion? give applications and projects polyurethane there X working now believe are update some to then get in on the And guys are expect one an place? and some going commercial when one us other those can Products, [indiscernible] semiconductor within or from Right. projects. see Just qualification taken to I Performance for you bit X right talk wondering those little the performance, contribution in Are can you we

Peter Huntsman

We is a in get and to And that given time for not so materials of couple are those. the X a That done into process We're various Usually, months project to as around catalyst have that. qualifying And hoping and expansion we cleaning the products going business going we're the expansion. solvents the now and and and months operating. products that, to products Pétfürdo, ultra-pure in be will that we qualifying That's mean forth. those other summer. be and believe year-end, be phases qualified, started there's past treatment Hungary. for those the right on with going our X production, looking polyurethane from you're of performance anywhere done, to should completed And to applications with is it's those on chip materials. we this project into

that So revenues I would in pure we ultra to say year start seeing early coming amines some ought production. next from the

Operator

Markets. Our RBC next Viswanathan comes with from Capital question Arun

Arun Viswanathan

to ask in what bit a little 'XX. you I just about see guess more I wanted

'XX of so say extra would into both I million bit and EBITDA, scenario? $XXX you of see such you second what similar look or recovery in that a or inventory 'XX, you substantially But ready 'XX? as to mean, higher. that So in of around 'XX, you're a you first you half little kind took and QX saw lean to 'XX that you're Or evolving really out half grow do in of parts kind in maybe range, of

We have and seen industrial auto, in some emerging weakness aero.

areas I'm the more -- if wondering recovery. require leverage would, so if customers to certain in really just would more And those you poised or of or your you're destocking for

Peter Huntsman

Yes.

our come I as the our building and don't think low product to to just and XXXX. I have about up them. at capital hoping the going our supply responsibility up inventories We'll eventually the materials. to at of kind overall lean be I'm customers. today, it's tie look cushion although think to sufficient inventories, But they for going that be buy we they're business And our going time, to into that same as

of coming see As the rest in China, think at U.S., strong and to particular, that I again, going that of And sort to the think probably world. in we pretty look environment. of automotive, see flat demand we're I out Asia we'll Europe continue

predicated -- our affect America. this to a going material that's I major in going China see much North growth, China. in around I line, where bottom upon America and consumer around is you areas So -- can the housing what where see going be North confidence to It's going of on be is, again, be drivers. to is to it's see housing.

really going this right opportunities more it's demand eventually And people for have would now the for Since board. been and the America, for to catalyst across resurgence be I just have see and pent-up in And China. that lockdowns COVID quite spending China, also now, years. to bit same growth there's that. as about and housing say many seems speculating consumer of a last happen. North again, with haven't in GDP I opportunity we of I see ended And seen a the think European couple return confidence And to the There European spending to in on of a China. particularly consumer

going business, out we're going be our XXXX, very have we as we're But taking into running and go we're costs lean. to of be to going low inventories, to

Arun Viswanathan

$XXXmillion to of so $XX of seasonality? any QX, incremental EBITDA there some inventory Or as down midpoint Or there demand would well? just some QX, that much for say that is clarify, like are of you that's weakness been seasonality? move could million there maybe I charges related you or how be And clearing mostly characterize? -- that so kind out the well. in if would Is the at could And has mostly as embedded there I imagine there in from

Peter Huntsman

going that seasonal a and some Yes. charges we be of -- There'll But this will that saw in just number to seasonal is benefit slowness. most that inventory in be is be reversal QX.

upside don't some here. seasonal we be see might there that if again, Now slowness,

we last seen seasonal that. today, the confident quarter or would our been the fourth -- numbers. I years, see But quarters where feel I given fourth fourth haven't There's we are pretty think slowness we typically in personally think in XX I always quarter. about X X we

at end to the look as we of the rate I at the stimulus that improve. the look We MDI year, look and cuts kind place to also get taking think housing here at continuing as China. and of we we I capacity earlier, As that's utilization stock in the in mentioned around housing

And taken I actions XXXX, year-on-year, a the we've our -- lot more the of SG&A cost than have highs. optimism in that XX pessimism. The past I personally strong in multi-decade-long flat a is we to into over have XX inflationary sheet. spite to think continue last going months, do balance very

that optimism to so And more I going pessimism. have XXXX, do Arun. a positive [indiscernible] I lot

Operator

And that question with comes from Laurence . Alexander Jefferies.

Daniel Rizzo

Dan is for Rizzo This Laurence.

So headwind ended, you I strike the to the just million EBITDA mentioned that seeing in and think Boeing million that strike was I was quarter. $X a $X

if and you within that, I upside? guys to So through next does kind beyond? the flow mean, for of it today or of ends how ends that couple days, provide QX Or does

Peter Huntsman

the it But part only can you a plane, had to fast affect quickly. as component, Well, you only having see to I'd plane as the make Chinese the slowest slowest tour Boeing make and manufacturers, a Airbus love opportunity arrives. and that

planes. you in planes see might lot waiting be forth. that to because so so $XX in being on you'll go into our of they're put a The inventory for wings are manufacturing some go waiting to and to sitting delayed these And are to able is of seats sites, fasteners arrive

and more week the an -- construction the X. to be So parties. more assume, will supply subbed I in is where that's seen airplane out or strike not of would normal the the This a in necessarily given being problems aerospace third back now to that we've chain, of

I line of I'm what not to and we'll say up going back not the -- things end the saying Boeing's anything is in be. that's Again, year. back get to lucky by about be that to production going -- think

is to subsequently starts and probably supply supply, I by it closer picking we up time am Boeing hits us, saying the year-end gets the who demand things Boeing, by that customers it's that time to customers today. moving, the then our than that be going the up,

Operator

conference. This today's concludes

at for we You may and participation. you time, your disconnect your thank lines this

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