Huntsman CORP 8-K, filed Jan 9, 2020
Huntsman CORP (HUN)
About this 8-K
Huntsman CORP filed this 8-K on January 9, 2020, reporting on events of January 3, 2020.
Items reported
- Item 2.01: Completed an acquisition or sale of assets
- Item 9.01: Financial statements and exhibits
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| Registrant | Title of each class | Trading Symbol | Name of each exchange on | |||
|---|---|---|---|---|---|---|
| Huntsman Corporation | ||||||
| Huntsman International LLC |
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Item 2.01. Completion of Acquisition or Disposition of Assets.
On January 3, 2020, Huntsman International LLC, a wholly-owned subsidiary of Huntsman Corporation (“Huntsman”), completed the previously announced sale of its chemical intermediates businesses, which included PO/MTBE, and its surfactants businesses (collectively, the “Chemical Intermediates Businesses”). The sale of the Chemical Intermediates Businesses was made pursuant to an Equity and Asset Purchase Agreement dated August 7, 2019 (as amended, waived, supplemented, modified or restated from time to time) with Indorama Ventures Holdings L.P., a Delaware limited partnership (“Indorama”), and Indorama Ventures Public Company Limited, a public company organized and existing under the laws of the Kingdom of Thailand and parent to Indorama.
The total purchase price was approximately $1.93 billion, which included estimated adjustments to the purchase price for working capital, plus the transfer of up to approximately $76 million in net underfunded pension and other post-employment benefit liabilities. The final purchase price remains subject to post-closing adjustments for deviations from net working capital, net indebtedness and assumed pension liability targets.
On January 5, 2020, Huntsman issued the press release attached hereto as Exhibit 99.1, which is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(b) Pro Forma Financial Information.
The pro forma financial information required pursuant to Article 11 of Regulation S-X is attached hereto as Exhibit 99.2 and is incorporated herein by reference.
(c) Exhibits.
| 1 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
Huntsman Corporation Huntsman International LLC | ||
| By: | /s/ Sean Douglas | |
| Name: | Sean Douglas | |
| Title: | Executive Vice President and Chief Financial Officer | |
Date: January 9, 2020
| 2 |
Exhibit 99.1
 |
 |
| FOR IMMEDIATE RELEASE | Media: | Investor Relations: | ||
| January 5, 2020 | Gary Chapman | Ivan Marcuse | ||
| The Woodlands, TX | (281) 719-4324 | (281) 719-4637 | ||
| NYSE: HUN |
Huntsman
Completes the Sale of its Chemical Intermediates and
Surfactants Businesses to Indorama Ventures for $2 Billion
THE WOODLANDS, Texas – Huntsman Corporation (NYSE: HUN) announced today it has completed the sale of its chemical intermediates businesses, which includes PO/MTBE, and its surfactants businesses to Indorama Ventures in a transaction valued at approximately $2 billion, comprising a cash purchase price of approximately $1.93 billion, which includes estimated adjustments to the purchase price for working capital, plus the transfer of up to approximately $76 million in net underfunded pension and other post-employment benefit liabilities. The final purchase price is subject to customary post-closing adjustments. The net cash proceeds are expected to be just under $1.6 billion.
Peter Huntsman, Chairman, President and CEO commented:
“This transformational transaction significantly reduces our capital-intensive upstream asset base, further bolsters our already strong balance sheet and allows us to further invest in and grow our downstream businesses. We are committed to retaining our investment grade balance sheet and our continued balanced approach to capital allocation. This transaction greatly expands our flexibility and opportunity for select strategic and accretive acquisitions, as well as for expansions in our core downstream global footprint, and for continued opportunistic repurchases of our shares. We remain disciplined and focused on the creation of long-term shareholder value.
“This is a great transaction for both Huntsman and Indorama. I am pleased to see that so many of our outstanding associates are transitioning to a company that has values like Huntsman. Led by Aloke Lohia, Indorama is a family-run business that understands the value of quality people. I look forward to an ongoing relationship with Indorama for years to come.”
About Huntsman:
Huntsman Corporation is a publicly traded global manufacturer and marketer of differentiated and specialty chemicals with 2018 revenues of more than $9 billion. Our chemical products number in the thousands and are sold worldwide to manufacturers serving a broad and diverse range of consumer and industrial end markets. We operate more than 75 manufacturing, R&D and operations facilities in approximately 30 countries and employ approximately 10,000 associates within our four distinct business divisions. For more information about Huntsman, please visit the company’s website at www.huntsman.com.
Social Media:
Twitter:
www.twitter.com/Huntsman_Corp
Facebook: www.facebook.com/huntsmancorp
LinkedIn: www.linkedin.com/company/huntsman
Forward-Looking Statements:
Certain information in this release constitutes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements are based on management’s current beliefs and expectations. The forward-looking statements in this release are subject to uncertainty and changes in circumstances and involve risks and uncertainties that may affect the company’s operations, markets, products, services, prices and other factors as discussed under the caption “Risk Factors” in the Huntsman companies’ filings with the U.S. Securities and Exchange Commission. Significant risks and uncertainties may relate to, but are not limited to, volatile global economic conditions, cyclical and volatile product markets, disruptions in production at manufacturing facilities, reorganization or restructuring of Huntsman’s operations, including any delay of, or other negative developments affecting the ability to implement cost reductions and manufacturing optimization improvements in Huntsman businesses and realize anticipated cost savings, and other financial, economic, competitive, environmental, political, legal, regulatory and technological factors. The company assumes no obligation to provide revisions to any forward-looking statements should circumstances change, except as otherwise required by applicable laws.
Exhibit 99.2
Summary of Unaudited Pro Forma Financial Information
The following unaudited financial information reflects the pro forma condensed consolidated balance sheets as of September 30, 2019 and the pro forma consolidated statements of operations for the years ended December 31, 2018, 2017 and 2016 for each of Huntsman Corporation and Huntsman International LLC (collectively, the “Company”), giving effect to the sale of its chemical intermediates businesses, which included PO/MTBE, and its surfactants businesses (collectively, the “Chemical Intermediates Businesses”). The condensed consolidated statements of operations for the nine months ended September 30, 2019, as included in the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2019, already reflect the results of operations of the Chemical Intermediates Businesses as discontinued operations. Accordingly, no pro forma condensed consolidated statements of operations for the nine months ended September 30, 2019 are included herein.
The unaudited pro forma consolidated statements of operations for the years ended December 31, 2018, 2017 and 2016 give effect to the sale as if the sale transaction occurred at the beginning of the periods presented. The unaudited pro forma condensed consolidated balance sheets as of September 30, 2019 assume the sale occurred on September 30, 2019.
The pro forma information is not necessarily indicative of the financial position or results of operations of future periods or indicative of results that would have actually occurred had the transaction been completed as of the date thereof or as of the beginning of the periods presented therein. The pro forma adjustments, as described in the accompanying notes to the pro forma condensed consolidated balance sheets and consolidated statements of operations, are based upon available information and certain assumptions the Company believes are reasonable. The pro forma financial information should be read in conjunction with the Company’s unaudited condensed consolidated financial statements included in its Form 10-Q for the quarterly period ended September 30, 2019 and the Company’s consolidated financial statements included in its Form 10-K for the year ended December 31, 2018.
HUNTSMAN CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
AS OF SEPTEMBER 30, 2019
(In millions)
| Huntsman | Pro Forma | |||||||||
| Corporation | Adjustments | Pro Forma | ||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 418 | $ | 1,895 | (2) | $ | 2,313 | |||
| Accounts and notes receivable, net | 1,078 | 1,078 | ||||||||
| Accounts receivable from affiliates | 12 | 12 | ||||||||
| Inventories | 961 | 961 | ||||||||
| Prepaid expenses | 53 | 53 | ||||||||
| Other current assets | 99 | 99 | ||||||||
| Current assets held for sale | 1,108 | (1,108 | )(1) | - | ||||||
| Total current assets | 3,729 | 787 | 4,516 | |||||||
| Property plant and equipment, net | 2,324 | 2,324 | ||||||||
| Investment in unconsolidated affiliates | 454 | 454 | ||||||||
| Intangible assets, net | 202 | 202 | ||||||||
| Goodwill | 274 | 274 | ||||||||
| Deferred income taxes | 309 | 309 | ||||||||
| Notes receivable from affiliate | 34 | 34 | ||||||||
| Operating lease right-of-use assets | 356 | 356 | ||||||||
| Other noncurrent assets | 433 | 433 | ||||||||
| Total assets | $ | 8,115 | $ | 787 | $ | 8,902 | ||||
| LIABILITIES AND EQUITY | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable | $ | 715 | $ | 715 | ||||||
| Accounts payable to affiliates | 29 | 29 | ||||||||
| Accrued liabilities | 406 | $ | 400 | (4) | 806 | |||||
| Current portion of debt | 132 | 132 | ||||||||
| Current operating lease liabilities | 37 | 37 | ||||||||
| Current liabilities held for sale | 586 | (586 | )(1) | - | ||||||
| Total current liabilities | 1,905 | (186 | ) | 1,719 | ||||||
| Long-term debt | 2,204 | 2,204 | ||||||||
| Deferred income taxes | 198 | 100 | (4) | 298 | ||||||
| Noncurrent operating lease liabilities | 349 | 349 | ||||||||
| Other noncurrent liabilities | 821 | 821 | ||||||||
| Total liabilities | 5,477 | (86 | ) | 5,391 | ||||||
| Equity | ||||||||||
| Huntsman Corporation stockholders’ equity: | ||||||||||
| Common stock | 3 | 3 | ||||||||
| Additional paid-in capital | 4,009 | 4,009 | ||||||||
| Treasury stock | (623 | ) | (623 | ) | ||||||
| Unearned stock-based compensation | (21 | ) | (21 | ) | ||||||
| Retained earnings | 424 | 825 | (3) | 1,249 | ||||||
| Accumulated other comprehensive loss | (1,310 | ) | 48 | (1) | (1,262 | ) | ||||
| Total Huntsman Corporation stockholders’ equity | 2,482 | 873 | 3,355 | |||||||
| Noncontrolling interests in subsidiaries | 156 | 156 | ||||||||
| Total equity | 2,638 | 873 | 3,511 | |||||||
| Total liabilities and equity | $ | 8,115 | $ | 787 | $ | 8,902 | ||||
| (1) | Reflects the disposition of the Chemical Intermediates Businesses as a result of the sale transaction. | |
| (2) | Reflects receipt of the sale consideration, less transaction costs. | |
| (3) | Reflects the preliminary gain on the sale transaction, net of taxes. | |
| (4) | Reflects the estimated current and deferred income taxes associated with the gain recognized upon closing of the sale transaction. |
HUNTSMAN CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
YEAR ENDED DECEMBER 31, 2018
(In Millions, Except Per Share Amounts)
| Huntsman | Pro Forma | |||||||||
| Corporation | Adjustments | Pro Forma | ||||||||
| Revenues: | ||||||||||
| Trade sales, services and fees, net | $ | 9,220 | $ | (1,769 | )(1) | $ | 7,451 | |||
| Related party sales | 159 | (6 | )(1) | 153 | ||||||
| Total revenues | 9,379 | (1,775 | ) | 7,604 | ||||||
| Cost of goods sold | 7,354 | (1,514 | )(1) | 5,840 | ||||||
| Gross profit | 2,025 | (261 | ) | 1,764 | ||||||
| Operating expenses: | ||||||||||
| Selling, general and administrative | 830 | (41 | )(1) | 789 | ||||||
| Research and development | 152 | (7 | )(1) | 145 | ||||||
| Restructuring, impairment and plant closing credits | (5 | ) | (2 | )(1) | (7 | ) | ||||
| Merger costs | 2 | 2 | ||||||||
| Other operating expense, net | 8 | 8 | ||||||||
| Total operating expenses | 987 | (50 | ) | 937 | ||||||
| Operating income | 1,038 | (211 | ) | 827 | ||||||
| Interest expense | (115 | ) | (115 | ) | ||||||
| Equity in income of investment in unconsolidated affiliates | 55 | 55 | ||||||||
| Fair value adjustments to Venator investment | (62 | ) | (62 | ) | ||||||
| Loss on early extinguishment of debt | (3 | ) | (3 | ) | ||||||
| Other income, net | 29 | 3 | (1) | 32 | ||||||
| Income from continuing operations before income taxes | 942 | (208 | ) | 734 | ||||||
| Income tax expense | (97 | ) | 52 | (2) | (45 | ) | ||||
| Income from continuing operations | $ | 845 | $ | (156 | ) | $ | 689 | |||
| Basic income per share: | ||||||||||
| Income from continuing operations attributable to Huntsman Corporation common stockholders | $ | 3.21 | $ | (0.66 | )(3) | $ | 2.55 | |||
| Weighted average shares | 238.1 | 238.1 | ||||||||
| Diluted income per share: | ||||||||||
| Income from continuing operations attributable to Huntsman Corporation common stockholders | $ | 3.16 | $ | (0.65 | )(3) | $ | 2.51 | |||
| Weighted average shares | 241.6 | 241.6 | ||||||||
| (1) | Reflects the removal of results of operations related to the disposition of the Chemical Intermediates Businesses as a result of the sale transaction. | |
| (2) | Reflects the tax effect of the pro forma adjustments. | |
| (3) | Reflects the basic and diluted per share impact of the sale transaction. |
NOTE: The above pro forma statement of operations does not reflect the net gain on the sale transaction.
HUNTSMAN CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
YEAR ENDED DECEMBER 31, 2017
(In Millions, Except Per Share Amounts)
| Huntsman | Pro Forma | |||||||||
| Corporation | Adjustments | Pro Forma | ||||||||
| Revenues: | ||||||||||
| Trade sales, services and fees, net | $ | 8,208 | $ | (1,524 | )(1) | $ | 6,684 | |||
| Related party sales | 150 | 11 | (1) | 161 | ||||||
| Total revenues | 8,358 | (1,513 | ) | 6,845 | ||||||
| Cost of goods sold | 6,552 | (1,358 | )(1) | 5,194 | ||||||
| Gross profit | 1,806 | (155 | ) | 1,651 | ||||||
| Operating expenses: | ||||||||||
| Selling, general and administrative | 798 | (39 | )(1) | 759 | ||||||
| Research and development | 138 | (6 | )(1) | 132 | ||||||
| Restructuring, impairment and plant closing costs | 20 | (1 | )(1) | 19 | ||||||
| Merger costs | 28 | 28 | ||||||||
| Other operating income, net | (23 | ) | 7 | (1) | (16 | ) | ||||
| Total operating expenses | 961 | (39 | ) | 922 | ||||||
| Operating income | 845 | (116 | ) | 729 | ||||||
| Interest expense | (165 | ) | (165 | ) | ||||||
| Equity in income of investment in unconsolidated affiliates | 13 | 13 | ||||||||
| Loss on early extinguishment of debt | (54 | ) | (54 | ) | ||||||
| Other income, net | 8 | 8 | ||||||||
| Income from continuing operations before income taxes | 647 | (116 | ) | 531 | ||||||
| Income tax expense | (64 | ) | 44 | (2) | (20 | ) | ||||
| Income from continuing operations | $ | 583 | $ | (72 | ) | $ | 511 | |||
| Basic income per share: | ||||||||||
| Income from continuing operations attributable to Huntsman Corporation common stockholders | $ | 2.01 | $ | (0.30 | )(3) | $ | 1.71 | |||
| Weighted average shares | 238.4 | 238.4 | ||||||||
| Diluted income per share: | ||||||||||
| Income from continuing operations attributable to Huntsman Corporation common stockholders | $ | 1.96 | $ | (0.30 | )(3) | $ | 1.66 | |||
| Weighted average shares | 243.9 | 243.9 | ||||||||
| (1) | Reflects the removal of results of operations related to the disposition of the Chemical Intermediates Businesses as a result of the sale transaction. | |
| (2) | Reflects the tax effect of the pro forma adjustments. | |
| (3) | Reflects the basic and diluted per share impact of the sale transaction. |
NOTE: The above pro forma statement of operations does not reflect the net gain on the sale transaction.
HUNTSMAN CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
YEAR ENDED DECEMBER 31, 2016
(In Millions, Except Per Share Amounts)
| Huntsman | Pro Forma | |||||||||
| Corporation | Adjustments | Pro Forma | ||||||||
| Revenues: | ||||||||||
| Trade sales, services and fees, net | $ | 7,387 | $ | (1,369 | )(1) | $ | 6,018 | |||
| Related party sales | 131 | (3 | )(1) | 128 | ||||||
| Total revenues | 7,518 | (1,372 | ) | 6,146 | ||||||
| Cost of goods sold | 6,000 | (1,175 | )(1) | 4,825 | ||||||
| Gross profit | 1,518 | (197 | ) | 1,321 | ||||||
| Operating expenses: | ||||||||||
| Selling, general and administrative | 772 | (29 | )(1) | 743 | ||||||
| Research and development | 137 | (7 | )(1) | 130 | ||||||
| Restructuring, impairment and plant closing costs | 47 | (16 | )(1) | 31 | ||||||
| Other operating income, net | (101 | ) | 2 | (1) | (99 | ) | ||||
| Total operating expenses | 855 | (50 | ) | 805 | ||||||
| Operating income | 663 | (147 | ) | 516 | ||||||
| Interest expense | (203 | ) | (203 | ) | ||||||
| Equity in income of investment in unconsolidated affiliates | 5 | 5 | ||||||||
| Loss on early extinguishment of debt | (3 | ) | (3 | ) | ||||||
| Other income, net | 12 | 12 | ||||||||
| Income from continuing operations before income taxes | 474 | (147 | ) | 327 | ||||||
| Income tax expense | (109 | ) | 53 | (2) | (56 | ) | ||||
| Income from continuing operations | $ | 365 | $ | (94 | ) | $ | 271 | |||
| Basic income per share: | ||||||||||
| Income from continuing operations attributable to Huntsman Corporation common stockholders | $ | 1.41 | $ | (0.40 | )(3) | $ | 1.01 | |||
| Weighted average shares | 236.3 | 236.3 | ||||||||
| Diluted income per share: | ||||||||||
| Income from continuing operations attributable to Huntsman Corporation common stockholders | $ | 1.39 | $ | (0.39 | )(3) | $ | 1.00 | |||
| Weighted average shares | 239.6 | 239.6 | ||||||||
| (1) | Reflects the removal of results of operations related to the disposition of the Chemical Intermediates Businesses as a result of the sale transaction. | |
| (2) | Reflects the tax effect of the pro forma adjustments. | |
| (3) | Reflects the basic and diluted per share impact of the sale transaction. |
NOTE: The above pro forma statement of operations does not reflect the net gain on the sale transaction.
HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
AS OF SEPTEMBER 30, 2019
(In millions)
| Huntsman | ||||||||||
| International | Pro Forma | |||||||||
| LLC | Adjustments | Pro Forma | ||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 417 | $ | 1,895 | (2) | $ | 2,312 | |||
| Accounts and notes receivable, net | 1,078 | 1,078 | ||||||||
| Accounts receivable from affiliates | 408 | 408 | ||||||||
| Inventories | 961 | 961 | ||||||||
| Prepaid expenses | 51 | 51 | ||||||||
| Other current assets | 102 | 102 | ||||||||
| Current assets held for sale | 1,108 | (1,108 | )(1) | - | ||||||
| Total current assets | 4,125 | 787 | 4,912 | |||||||
| Property plant and equipment, net | 2,324 | 2,324 | ||||||||
| Investment in unconsolidated affiliates | 454 | 454 | ||||||||
| Intangible assets, net | 202 | 202 | ||||||||
| Goodwill | 274 | 274 | ||||||||
| Deferred income taxes | 309 | 309 | ||||||||
| Notes receivable from affiliate | 34 | 34 | ||||||||
| Operating lease right-of-use assets | 356 | 356 | ||||||||
| Other noncurrent assets | 433 | 433 | ||||||||
| Total assets | $ | 8,511 | $ | 787 | $ | 9,298 | ||||
| LIABILITIES AND EQUITY | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable | $ | 714 | $ | 714 | ||||||
| Accounts payable to affiliates | 112 | 112 | ||||||||
| Accrued liabilities | 403 | $ | 400 | (4) | 803 | |||||
| Notes payable to affiliates | 100 | 100 | ||||||||
| Current portion of debt | 132 | 132 | ||||||||
| Current operating lease liabilities | 37 | 37 | ||||||||
| Current liabilities held for sale | 586 | (586 | )(1) | - | ||||||
| Total current liabilities | 2,084 | (186 | ) | 1,898 | ||||||
| Long-term debt | 2,204 | 2,204 | ||||||||
| Notes payable to affiliates | 291 | 291 | ||||||||
| Deferred income taxes | 195 | 100 | (4) | 295 | ||||||
| Noncurrent operating lease liabilities | 349 | 349 | ||||||||
| Other noncurrent liabilities | 813 | 813 | ||||||||
| Total liabilities | 5,936 | (86 | ) | 5,850 | ||||||
| Equity | ||||||||||
| Huntsman International LLC members’ equity: | ||||||||||
| Members’ equity | 3,673 | 3,673 | ||||||||
| Retained earnings | 47 | 825 | (3) | 872 | ||||||
| Accumulated other comprehensive loss | (1,301 | ) | 48 | (1) | (1,253 | ) | ||||
| Total Huntsman International LLC members’ equity | 2,419 | 873 | 3,292 | |||||||
| Noncontrolling interests in subsidiaries | 156 | 156 | ||||||||
| Total equity | 2,575 | 873 | 3,448 | |||||||
| Total liabilities and equity | $ | 8,511 | $ | 787 | $ | 9,298 | ||||
| (1) | Reflects the disposition of the Chemical Intermediates Businesses as a result of the sale transaction. |
| (2) | Reflects receipt of the sale consideration, less transaction costs. |
| (3) | Reflects the preliminary gain on the sale transaction, net of taxes. |
| (4) | Reflects the estimated current and deferred income taxes associated with the gain recognized upon closing of the sale transaction. |
HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
YEAR ENDED DECEMBER 31, 2018
(In Millions)
| Huntsman | ||||||||||
| International | Pro Forma | |||||||||
| LLC | Adjustments | Pro Forma | ||||||||
| Revenues: | ||||||||||
| Trade sales, services and fees, net | $ | 9,220 | $ | (1,769 | )(1) | $ | 7,451 | |||
| Related party sales | 159 | (6 | )(1) | 153 | ||||||
| Total revenues | 9,379 | (1,775 | ) | 7,604 | ||||||
| Cost of goods sold | 7,351 | (1,514 | )(1) | 5,837 | ||||||
| Gross profit | 2,028 | (261 | ) | 1,767 | ||||||
| Operating expenses: | ||||||||||
| Selling, general and administrative | 825 | (41 | )(1) | 784 | ||||||
| Research and development | 152 | (7 | )(1) | 145 | ||||||
| Restructuring, impairment and plant closing credits | (5 | ) | (2 | )(1) | (7 | ) | ||||
| Merger costs | 2 | 2 | ||||||||
| Other operating expense, net | 8 | 8 | ||||||||
| Total operating expenses | 982 | (50 | ) | 932 | ||||||
| Operating income | 1,046 | (211 | ) | 835 | ||||||
| Interest expense | (136 | ) | (136 | ) | ||||||
| Equity in income of investment in unconsolidated affiliates | 55 | 55 | ||||||||
| Fair value adjustments to Venator investment | (62 | ) | (62 | ) | ||||||
| Loss on early extinguishment of debt | (3 | ) | (3 | ) | ||||||
| Other income, net | 24 | 3 | (1) | 27 | ||||||
| Income from continuing operations before income taxes | 924 | (208 | ) | 716 | ||||||
| Income tax expense | (93 | ) | 52 | (2) | (41 | ) | ||||
| Income from continuing operations | $ | 831 | $ | (156 | ) | $ | 675 | |||
| (1) | Reflects the removal of results of operations related to the disposition of the Chemical Intermediates Businesses as a result of the sale transaction. |
| (2) | Reflects the tax effect of the pro forma adjustments. |
NOTE: The above pro forma statement of operations does not reflect the net gain on the sale transaction.
HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
YEAR ENDED DECEMBER 31, 2017
(In Millions)
| Huntsman | ||||||||||
| International | Pro Forma | |||||||||
| LLC | Adjustments | Pro Forma | ||||||||
| Revenues: | ||||||||||
| Trade sales, services and fees, net | $ | 8,208 | $ | (1,524 | )(1) | $ | 6,684 | |||
| Related party sales | 150 | 11 | (1) | 161 | ||||||
| Total revenues | 8,358 | (1,513 | ) | 6,845 | ||||||
| Cost of goods sold | 6,546 | (1,358 | )(1) | 5,188 | ||||||
| Gross profit | 1,812 | (155 | ) | 1,657 | ||||||
| Operating expenses: | ||||||||||
| Selling, general and administrative | 793 | (39 | )(1) | 754 | ||||||
| Research and development | 138 | (6 | )(1) | 132 | ||||||
| Restructuring, impairment and plant closing costs | 20 | (1 | )(1) | 19 | ||||||
| Merger costs | 28 | 28 | ||||||||
| Other operating income, net | (23 | ) | 7 | (1) | (16 | ) | ||||
| Total operating expenses | 956 | (39 | ) | 917 | ||||||
| Operating income | 856 | (116 | ) | 740 | ||||||
| Interest expense | (181 | ) | (181 | ) | ||||||
| Equity in income of investment in unconsolidated affiliates | 13 | 13 | ||||||||
| Loss on early extinguishment of debt | (54 | ) | (54 | ) | ||||||
| Other income, net | 6 | 6 | ||||||||
| Income from continuing operations before income taxes | 640 | (116 | ) | 524 | ||||||
| Income tax expense | (61 | ) | 44 | (2) | (17 | ) | ||||
| Income from continuing operations | $ | 579 | $ | (72 | ) | $ | 507 | |||
| (1) | Reflects the removal of results of operations related to the disposition of the Chemical Intermediates Businesses as a result of the sale transaction. |
| (2) | Reflects the tax effect of the pro forma adjustments. |
NOTE: The above pro forma statement of operations does not reflect the net gain on the sale transaction.
HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
YEAR ENDED DECEMBER 31, 2016
(In Millions)
| Huntsman | ||||||||||
| International | Pro Forma | |||||||||
| LLC | Adjustments | Pro Forma | ||||||||
| Revenues: | ||||||||||
| Trade sales, services and fees, net | $ | 7,387 | $ | (1,369 | )(1) | $ | 6,018 | |||
| Related party sales | 131 | (3 | )(1) | 128 | ||||||
| Total revenues | 7,518 | (1,372 | ) | 6,146 | ||||||
| Cost of goods sold | 5,993 | (1,175 | )(1) | 4,818 | ||||||
| Gross profit | 1,525 | (197 | ) | 1,328 | ||||||
| Operating expenses: | ||||||||||
| Selling, general and administrative | 768 | (29 | )(1) | 739 | ||||||
| Research and development | 137 | (7 | )(1) | 130 | ||||||
| Restructuring, impairment and plant closing costs | 47 | (16 | )(1) | 31 | ||||||
| Other operating income, net | (101 | ) | 2 | (1) | (99 | ) | ||||
| Total operating expenses | 851 | (50 | ) | 801 | ||||||
| Operating income | 674 | (147 | ) | 527 | ||||||
| Interest expense | (215 | ) | (215 | ) | ||||||
| Equity in income of investment in unconsolidated affiliates | 5 | 5 | ||||||||
| Loss on early extinguishment of debt | (3 | ) | (3 | ) | ||||||
| Other income, net | 14 | 14 | ||||||||
| Income from continuing operations before income taxes | 475 | (147 | ) | 328 | ||||||
| Income tax expense | (108 | ) | 53 | (2) | (55 | ) | ||||
| Income from continuing operations | $ | 367 | $ | (94 | ) | $ | 273 | |||
| (1) | Reflects the removal of results of operations related to the disposition of the Chemical Intermediates Businesses as a result of the sale transaction. |
| (2) | Reflects the tax effect of the pro forma adjustments. |
NOTE: The above pro forma statement of operations does not reflect the net gain on the sale transaction.