Q1 2010 Earnings Call
May 07, 2010 10:00 am ET
Peter Huntsman - Chief Executive Officer, President, Director and Member of Litigation Committee
J. Esplin - Chief Financial Officer and Executive Vice President
Kurt Ogden - Vice President of Investor Relations
Robert Koort - Goldman Sachs Group Inc.
Amanda Sigouin - Jefferies & Company
William Young - Longbow Capital
Previous Statements by HUN
» Huntsman Corp. Q4 2009 Earnings Call Transcript
» Huntsman Corporation. Q3 2009 Earnings Call Transcript
» Huntsman Q2 2009 Earnings Transcript
Good day, ladies and gentlemen, and welcome to the First Quarter 2010 Huntsman Corporation Earnings Conference Call. My name is Chanel, and I will be your coordinator for today. [Operator Instructions] I would now like to turn the presentation over to your host for today's call, Mr. Kurt Ogden, Huntsman Corporation Vice President in Investor Relations. Please proceed.
Thank you, Chanel. Good morning, everyone, and welcome to Huntsman's Investor Conference Call for the first quarter 2010. Joining us on the call today are Peter Huntsman, President and CEO; and Kimo Esplin, Executive Vice President and CFO.
This morning, before the market opened, we released our earnings for the first quarter 2010 via press release and posted it on our website, huntsman.com. We also posted a set of slides on our website, which we intend to use on the call this morning in the discussion of our results.
During this call, we may make statements about our projections or expectations for the future. All such statements are forward-looking statements, and while they reflect our current expectations, they involve risks and uncertainties and are not guarantees of future performance. You should review our filings with the Securities and Exchange Commission for more information regarding the factors that could cause actual results to differ materially from these projections or expectations.
We do not plan on publicly updating or revising any forward-looking statements during the quarter. In addition, we may also refer to non-GAAP financial measures. You can find reconciliations to the most directly comparable GAAP financial measures in our earnings release posted on our website at huntsman.com.
Following my comments, Peter Huntsman will review the recent performance for each of our divisions, after which, Kimo Esplin will address certain business trends and financial-related items, and then Peter will provide some concluding thoughts. At the conclusion of our prepared remarks, we look forward to taking questions from you.
As we refer to earnings, we will be referring to adjusted EBITDA, which is EBITDA adjusted to exclude the impact of discontinued operations, restructuring impairment and plant-closing costs, income and expense associated with the terminated merger and related litigation, acquisition-related expenses, unallocated foreign exchange gains and losses, losses from the early extinguishment of debt, extraordinary gains and losses on the acquisition of a business and losses and gains on disposition of businesses and assets.
We focus on adjusted EBITDA from a management standpoint as we believe it is the best measure of the underlying performance of operations. And we have received feedback from many of you in the investment community that this is how you prefer to look at our business. A reconciliation of EBITDA, adjusted EBITDA and adjusted net loss/income can be found in the appendix of our slides and in our fourth quarter earnings release.
Let's turn to Slide 3. In our earnings release this morning, we reported first quarter 2010 revenue of $2,094,000,000, adjusted EBITDA of $123 million and adjusted earnings per share of $0.07 loss per diluted share. Our adjusted EBITDA increased to $123 million in the first quarter 2010, compared to $57 million in the prior year and decreased from $174 million in the prior quarter. Both prior-period figures have been adjusted to account for the re-class of results from our Australian Styrenics business into discontinued operations.
Our first quarter 2010 results were negatively impacted by $51 million of production disruptions. $40 million was the result of our planned maintenance outage at our Port Neches, Texas PO/MTBE facility and $11 million was the result of mechanical shutdowns at our separate Port Neches, Texas ethylene facility. With that, I will turn the call over to Peter Huntsman, our CEO, who will discuss our results in more detail.
Kurt, thank you very much, and thank you all for joining us this morning. Let's turn to Slide #4. Our Polyurethanes adjusted EBITDA results of $52 million were nearly double from the prior year despite the negative impact of $40 million from our planned maintenance outage at our Port Neches, Texas Propylene Oxide/MTBE facility, which was completed in March. It had been six years since this facility was last shut down for this type of maintenance, and we shouldn't see this magnitude of planned production disruption for another six years.
Huntsman's global demand for MDI [methyl diphenyl diisocyanate] increased 35% in the first quarter compared to the prior year. We continue to see tremendous growth in Asia. Chinese stimulus and our government-stimulus initiatives targeting infrastructure, investment and domestic consumption are a significant driver, but we are seeing strong domestic demand that are quite unrelated to what the Chinese government is promoting. Demand in the Americas improved significantly compared to the prior year, as signs of economic recovery are manifest in installation, automotive and other sectors. We are also seeing increased MDI substitution of formaldehyde resins in wood products and for TDI [toluene diisocyanate] in cushioning applications.
In Europe, our largest market, we saw a substantial year-over-year recovery and demand, albeit, somewhat hampered due to colder-than-normal weather. Notable increases were seen across the sector, not as affected by weather and including automotive, adhesives, coatings, appliances and furniture. We're also pleased with the growth in India and Eastern Europe that we are saying.