29 October 2013 11:01 [Source: ICIS news]
LONDON (ICIS)--Huntsman’s net income in the third quarter in 2013 fell steeply to $64m (€46m) compared to $116m in the same period last year, the US-based producer said on Tuesday, following a drop in earnings from its pigments segment during the period.
However, the group’s net income was higher than $47m reported in the second quarter of 2013.
Third-quarter sales rose 4% year on year to $2.84bn, although the group’s adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) fell to $376m compared with $411m in the same period last year and $304m in the prior quarter.
“Our third quarter results were very strong, excluding results from our Pigments business our earnings improved compared to the previous year and quarter,” said Peter Huntsman, president and CEO.
“Earnings within our Pigments business have been improving throughout the year and we are encouraged by industry trends. Earnings improved across all of our businesses compared to last quarter,” he added.
Adjusted EBITDA in Huntsman’s polyurethanes business in the third quarter slipped 12% year on year to $215m, while the pigments segment saw adjusted EBITDA fall 52% to $36m.
The decrease in adjusted EBITDA in the polyurethanes business was primarily due to lower propylene oxide (PO) and methyl tertiary butyl ether (MTBE) earnings and the impact of the extended force majeure at the group’s methyl di-p-phenylene isocyanate (MDI) facility in Rotterdam, in the Netherlands.
The fall in adjusted EBITDA in pigments was mainly because of lower contribution margins partially offset by higher sales volumes and lower manufacturing and selling, general and administrative costs as a result of Huntsman’s restructuring efforts, it added.
"During the quarter, we announced an agreement with Rockwood Holdings to acquire their Performance Additives and Titanium Dioxide businesses. We expect to pursue a public offering of our new combined Pigments business to allow greater investor focus and appreciation for our differentiated businesses.
“With improving market conditions and pro forma synergies in excess of $130 million we believe this acquisition will add significant shareholder value. We also closed on an acquisition within our Polyurethanes division which strengthens our downstream and specialty capabilities,” the CEO said.
($1 = €0.72)
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