NPRA ’10: Huntsman aims for $20 share price

30 March 2010 00:37  [Source: ICIS news]

SAN ANTONIO, Texas (ICIS news)--Huntsman’s share price could push towards $20 (€15), based on normalised levels of cash flow, president and CEO Peter Huntsman said on Monday.

“Our company has historically had an average EBITDA (earnings before interest, tax, depreciation and amortisation) of about $1bn/year. If we get back to those normalised levels, we’d be pushing towards a $20 stock price,” said Huntsman on the sidelines of the International Petrochemical Conference (IPC).

Shares of Huntsman closed at $12.60 on Monday. Huntsman posted adjusted EBITDA of $511m in 2009, down from $643m in 2008.

Asia will be the key driver of growth in the next two-to-three years, said Huntsman.

“Asia is performing better than we thought, while the US has performed within expectations, and Europe has been a bit worse,” he said.

“But we are not waiting for the US to recover,” he added.

Huntsman said Asia Pacific would likely comprise the low 20% range of total sales, with the US in the low 30% range, and Europe at about 30%.

While key end markets such as automotive and construction will recover, the nature of the recovery will be different, said Huntsman.

“More autos will be built in China than in the US and Europe. And they will be more lightweight and fuel-efficient vehicles using materials like carbon fibre,” said Huntsman.

“In construction, we won’t go back to a frenzy of homebuilding in the US where banks were giving mortgages at 110% of value. Plus, the buildings will be different as well – more energy efficient and making more use of things like UV-reflective coatings,” he added.

Hosted by the National Petrochemical & Refiners Association (NPRA), the IPC continues through Tuesday.

($1 = €0.74)

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By: Joseph Chang
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