Company News
August 10, 2026
An Overview of ADNOC
ADNOC Global Expansion Accelerates After UAE’s OPEC Exit
Friday 07/August/2026 – 03:54 PM
Abu Dhabi National Oil Company is pursuing higher production, overseas acquisitions and new export infrastructure as the UAE seeks to strengthen its position in global energy markets.
The ADNOC global expansion strategy is gathering momentum following the United Arab Emirates’ departure from OPEC, giving Abu Dhabi’s state oil company greater freedom to pursue higher production, international acquisitions and new export routes as it seeks to establish itself as a major global energy player.
When the UAE left OPEC, ADNOC leadership said the decision should not be interpreted as a rebuke to Saudi Arabia or other producers. Instead, the departure was presented as reflecting confidence in the country’s capabilities and ambitions.
Three months later, ADNOC’s activities point toward an increasingly assertive strategy: maximizing domestic oil production, expanding internationally and reducing its vulnerability to disruptions around the Strait of Hormuz.
The shift represents another stage in ADNOC’s transformation from a traditionally domestically focused national oil company into an energy group with ambitions extending far beyond the UAE.
“This is a very interesting period for ADNOC,” said Robin Mills, chief executive of energy advisory firm Qamar Energy. “It’s an evolution of where they have been going over the past five or six years but the plan has been accelerated and they’re more aggressive.”
ADNOC’s Transformation Carries National Importance
ADNOC occupies an unusually important position within the UAE economy.
Oil revenues generated by the company played a central role in financing the transformation of the federation from a group of desert sheikhdoms into a modern international center for trade, investment and finance.
Its future strategy therefore carries implications extending well beyond the energy industry.
The UAE itself has adopted an increasingly assertive posture internationally during the past decade, including in diplomacy and military affairs — a reputation that has earned it the nickname “Little Sparta” in some diplomatic circles.
ADNOC’s more expansive strategy can be viewed against that broader backdrop.
The central question is whether the company can successfully capitalize on its greater freedom outside OPEC while managing the financial, geopolitical and market risks that accompany aggressive expansion.
UAE-Saudi Competition Could Reshape the Oil Market
One significant uncertainty is the future relationship between the UAE and Saudi Arabia, OPEC’s dominant producer.
Signs of possible competition have already emerged.
ADNOC increased production to a record level in June, while Saudi Arabia reduced its official crude selling prices, particularly for Asian customers.
If both countries pursue maximum production simultaneously, the resulting increase in supply could place substantial downward pressure on crude prices.
That would create a dilemma.
Higher production could help the UAE capture additional market share, but significantly lower oil prices could reduce revenues and make new investments less attractive.
Both Saudi Arabia and the UAE also need revenue as they seek to repair financial damage resulting from the Iran war.
One factor potentially providing producers with greater flexibility is the decline in global oil inventories during the conflict, which could allow additional supply to enter the market without immediately creating the degree of oversupply that might occur under different conditions.
ADNOC maintains that leaving OPEC has not altered its underlying strategy.
“We have accelerated our growth plans in the UAE and internationally to meet [growing] demand,” an ADNOC spokesperson said.
ADNOC Pushes to Maximize Oil Production
Increasing crude production has been part of ADNOC’s strategy for years rather than a policy developed only after the UAE left OPEC.
Some observers believe the accelerated approach reflects a desire to monetize the country’s petroleum resources while they retain substantial economic value amid the global energy transition.
ADNOC chief executive Sultan al-Jaber has argued that global oil demand will remain strong for longer than many forecasts suggest.
Al-Jaber, who also served as president of the United Nations climate talks in 2023, has nevertheless overseen a strategy that increasingly extends ADNOC beyond conventional crude production.
Petrochemicals are a major component of that diversification.
Demand for petroleum as a transportation fuel could eventually face greater pressure from electric vehicles and renewable energy. Petrochemicals, by contrast, are widely expected to remain an important source of hydrocarbon demand.
ADNOC has consequently invested tens of billions of dollars internationally as it seeks to establish a much larger position in the sector.
$60 Billion Petrochemicals Group Expands ADNOC’s Reach
One of the most significant steps in the ADNOC global expansion came through the combination of its petrochemicals operations with Austrian energy company OMV’s feedstock business.
The transaction created Borouge Group International AG, valued at approximately $60 billion.
ADNOC also completed its $17 billion acquisition of German polymer manufacturer Covestro at the end of last year.
Together, those deals significantly expanded the UAE company’s presence across the international chemicals and advanced-materials industries.
The company has also pursued smaller transactions.
Its distribution business recently acquired Shell fuel stations in South Africa for $1 billion, establishing a UAE retail presence in Africa’s largest economy and providing ADNOC with another platform for international expansion.
The moves suggest ADNOC is seeking to develop assets across multiple stages of the energy value chain rather than remaining primarily a producer and exporter of Abu Dhabi crude.
“If they want to build an oil company that’s a genuine international competitor, they need a proper set of international assets,” Mills said.
“They’re throwing off a huge amount of cash and it’s a potential engine to the rest of the economy because they’ve proven in the past that they can get stuff done.”
Strait of Hormuz Disruption Exposes Strategic Vulnerability
ADNOC’s ambitions are not limited to increasing production and acquiring overseas assets.
Finding secure ways to deliver oil to customers has become an immediate priority.
Since March, much of the company’s production has struggled to reach international markets because of the closure of the Strait of Hormuz, exposing a longstanding vulnerability facing Gulf energy exporters.
The waterway is one of the world’s most strategically important oil transit routes.
ADNOC already operates a pipeline capable of transporting approximately 1.5 million barrels per day overland to Fujairah on the UAE’s eastern coast, allowing crude to bypass Hormuz.
But the company is now accelerating efforts to increase that capacity.
Second Fujairah Pipeline Could Double Export Capacity
ADNOC is constructing a second pipeline to Fujairah that is expected to double the volume of crude that can be exported from the UAE’s east coast beginning in 2027.
The strategic logic is straightforward: the more oil the UAE can transport directly to the Arabian Sea side of the country, the less dependent its exports become on passage through the Strait of Hormuz.
ADNOC is also considering a pipeline for refined petroleum products.
Those plans could be expanded further if the struggle over control and security of Hormuz continues.
For the UAE, the infrastructure is therefore about more than transportation efficiency. It represents an attempt to reduce a significant geopolitical vulnerability affecting the country’s most important export industry.
Leaving OPEC Removes Production Quotas
Despite ADNOC’s growing international portfolio, maximizing domestic crude production remains central to its strategy.
The foundations of that expansion were established about a decade ago.
After Sultan al-Jaber became ADNOC chief executive in 2016, he was presented with a proposal to increase oil exploration. According to people familiar with the company’s history, he quickly became a strong advocate of the plan.
Increasing the UAE’s proven reserves would strengthen Abu Dhabi’s argument for a larger OPEC production quota, enabling ADNOC to produce more crude while remaining within the organization’s framework.
Within approximately six weeks, al-Jaber had put an expansion plan in place, according to one person involved in the discussions.
By 2018, ADNOC had established a goal of increasing oil production capacity from 3.5 million barrels per day to 5 million b/d by 2030.
The timetable was subsequently accelerated, with the company targeting 2027 instead.
Leaving OPEC fundamentally changes one constraint surrounding that ambition: the UAE is no longer required to operate within the cartel’s production quotas.
UAE Production Reaches Record Levels
ADNOC says it can already produce as much as 4.8 million barrels per day after bringing additional reserves into production.
The company has also tested production at 5 million b/d for a limited period.
According to the International Energy Agency, UAE oil production averaged approximately 4.1 million barrels per day in June, its highest level since the agency’s records began, despite disruptions caused by the war.
ADNOC says its strategy itself has not changed following the UAE’s OPEC departure.
“The UAE’s participation in international organisations is a matter for the relevant government authorities,” a company spokesperson said.
Yet analysts believe ADNOC’s production ambitions could ultimately move beyond its existing 5 million-barrel-per-day capacity target.
International Oil Majors See New Opportunities
ADNOC is already exploring projects that could raise production capacity further in cooperation with international energy companies, according to Dalia Salem, Middle East upstream analyst at Wood Mackenzie.
The UAE’s departure from OPEC could improve the economics of those investments because production would no longer be restricted by cartel quotas.
“There’s a lot more excitement from international oil companies now that they’re no longer an OPEC member,” Salem said.
“There are no restrictions and quotas limiting the rates that they have to produce and this improves project economics and makes unconventional oil more attractive to investors.”
The UAE’s partnership strategy differs notably from neighboring Saudi Arabia.
While Saudi Aramco has restricted the extent to which foreign companies can profit directly from Saudi crude production, ADNOC has expanded partnerships with international oil companies.
Foreign Oil Companies Expand UAE Production
Between 2020 and 2025, oil and gas production in the UAE by international majors including BP and TotalEnergies increased 34 percent, according to Wood Mackenzie research.
During that period, private international oil majors produced approximately 10 times more oil in the UAE than in Saudi Arabia.
Wood Mackenzie expects their role to continue expanding.
Over the next decade, international companies are projected to increase their UAE oil and gas production by another 25 percent, eventually producing approximately 1.2 million barrels per day out of projected total UAE production of 7.9 million b/d.
Those forecasts illustrate how international partnerships could become a crucial component of ADNOC’s next phase of growth.
Partnerships Have Not Been Without Friction
Relations between ADNOC and international oil companies have occasionally faced difficulties.
During the Iran war, several private-sector partners complained about aspects of ADNOC’s decision-making, including what they viewed as the company prioritizing exports of its own crude over those of its partners.
Those tensions have not eliminated international interest in UAE resources.
Access to the country’s substantial hydrocarbon reserves remains commercially attractive, and major European energy companies have continued pursuing opportunities with ADNOC.
TotalEnergies, Eni and BP are among the companies that have sought involvement in ADNOC’s gas-cap developments since the Iran war began.
ADNOC’s Post-OPEC Strategy Extends Beyond Producing More Oil
The significance of the ADNOC global expansion is therefore broader than the UAE simply producing more crude after leaving OPEC.
Three strategic priorities are emerging simultaneously: higher production, greater international reach and stronger control over export routes.
Its growing petrochemicals portfolio gives ADNOC exposure to an area of petroleum demand that could remain resilient even as transportation becomes increasingly electrified.
Its investments in pipelines to Fujairah could reduce the UAE’s dependence on the Strait of Hormuz.
Its partnerships with international oil companies could accelerate development of additional reserves and unconventional resources.
And freedom from OPEC quotas potentially allows Abu Dhabi to pursue production based more directly on its own commercial and strategic calculations.
But that freedom introduces risks of its own.
If the UAE and Saudi Arabia aggressively compete for market share, increased production could push global oil prices lower. Such a decline could undermine the economics of the very investments ADNOC is attempting to accelerate.
The company must therefore balance two potentially competing objectives: maximizing the value of the UAE’s enormous petroleum resources while maintaining prices high enough to sustain profitability and investment.
ADNOC’s transformation has been underway for years. The UAE’s departure from OPEC did not create those ambitions.
What it appears to have done is remove one of the principal constraints on how aggressively the company can pursue them.
Whether that freedom ultimately transforms ADNOC into a global energy major — or contributes to a more disruptive period of competition among Gulf producers — will depend not only on Abu Dhabi’s strategy, but also on oil demand, regional geopolitics and how Saudi Arabia responds.
August 10, 2026
Covestro Declares FM on Polyol
Rhine River water levels critical! Covestro declares force majeure on polyether polyols
2026-08-10 08:54:07Source:ChemNet中文
Market news on August 7, 2026: Covestro Germany officially issued a force majeure notice for its polyether polyol series products. Extreme low water levels on the Rhine River impact raw material transportation to the factory, and the supply of related chemical raw materials in Europe faces disruption.
I. Core Trigger for Force Majeure: Rhine River Water Level Drops to a Historic Low
Recently, the water level of the Rhine River has continued to decline, with the water level at the Düsseldorf monitoring station hitting a new historic low. Covestro’s Dormagen plant is constrained by river water levels and has encountered sudden circumstances beyond the company’s control.
The core raw material for polyether polyols, propylene oxide (PO), is restricted by the plant’s supporting technical conditions and can only be transported by ship. Under current Rhine River water level conditions, it is no longer possible to guarantee the stable acquisition of sufficient volumes of shipped PO raw materials for the Dormagen plant, directly limiting raw material supply.
II. Factory Production Impeded, Supply Gap Difficult to Fill in the Short Term
The direct cutoff of raw material supply has led to insufficient capacity utilization for polyether polyols at the Dormagen plant, making it impossible to complete product delivery according to original contracts.
Covestro stated that at this stage, relying on means such as allocation from other group plants and external procurement cannot fully bridge the supply gap caused by this incident. As a result, related products will experience severe delivery delays, production reductions, or even supply interruptions. During the validity period of the force majeure, the company cannot guarantee product supply but will promote feasible alternative supply plans as much as possible.
III. Multiple Product Series Involved, Downstream Polyurethane Industry Chain Under Pressure
The products affected by this force majeure cover multiple mainstream product lines, including Acclaim Polyol, Arcol Polyol, Baydur, Bayfill, Bayfit, Bayflex, Baymer, Baytherm, Desmophen, and other series.
Polyether polyols are a key basic raw material for the polyurethane industry chain. The obstruction of supply from European local facilities may disrupt global polyether polyol trade flows and form an indirect impact on downstream industry chains such as foams and composite materials.
Related link: High temperatures and drought severely hit Rhine River shipping; German industrial supply chain encounters serious impact
August 9, 2026
L&P Quarterly Results
Leggett & Platt Reports 2Q 2026 Results
Aug 06, 2026, 6:30 AM ETSomnigroup International Inc. (SGI), LEG
Q2: 2026-08-06 Earnings Summary
EPS of $0.58 beats by $0.00
| Revenue of $1.82B (-3.05% Y/Y) misses by $58.97M
CARTHAGE, Mo., Aug. 6, 2026 /PRNewswire/ —
- 2Q sales of $1.0 billion, a 6% decrease vs 2Q25, including a 5% decrease from divestitures
- 2Q EPS of $.33, 2Q adjusted1 EPS of $.39, a $.09 increase vs adjusted1 2Q25 EPS
President and CEO Karl Glassman commented, “We are pleased with how our teams managed through a challenging environment in the second quarter. Our employees remained focused on disciplined execution and cost management which, along with favorable items that we do not expect to repeat in future quarters, contributed to improved adjusted earnings.
“Bedding industry conditions remain challenged both by sluggish consumer activity and continued consolidations and bankruptcies across the value chain. We estimate that U.S. mattress market units declined by low double digits in the second quarter, similar to the declines we saw in the first quarter. In our Bedding Products segment, continued strong performance of our trade rod and wire business partially offset the decline from lower mattress demand.
“Across our other segments, demand remained soft in markets tied to housing and broader consumer spending as consumers were faced with additional uncertainty resulting from the war in the Middle East and higher gas prices. In Specialized Products, Automotive performed slightly below the market, which saw lower consumer demand across all regions. In Furniture, Flooring & Textile Products, growth in Textiles offset lower demand in the remaining businesses, which are more directly exposed to U.S. residential spending, leading to a slight improvement in trade sales.
“As we look forward, we remain focused on executing our strategic priorities while expecting ongoing macroeconomic headwinds to temper consumer demand across most of our businesses for the remainder of the year.
“Finally, we continue to progress towards the planned merger with Somnigroup. As previously announced, the waiting period under the HSR Antitrust Improvements Act expired in June. We anticipate the transaction to close upon satisfaction of the remaining closing conditions, including Leggett & Platt (LEG) shareholder approval at the special meeting planned for August 20th and the remaining required regulatory approvals. As previously stated, we believe this combination with a valued long–standing customer will create a leading global company – providing compelling strategic and financial value for our customers, employees, and the Leggett & Platt shareholders.”
SECOND QUARTER RESULTS
Second quarter sales were $1.0 billion, a 6% decrease versus second quarter last year
- 2025 divestitures decreased sales 5%
- Organic sales2 were down 1%
- Volume was down 4%, primarily from continued weak demand across most of our end markets, retailer merchandising changes in Adjustable Bed, and the decision during the fourth quarter of 2025 to walk away from a financially challenged customer in U.S. Spring
- Raw material-related selling price increases added 2% to sales
- Currency benefit increased sales 1%
Second quarter EBIT was $80 million, down from $90 million in second quarter 2025. Adjusted1 EBIT was $89 million, up from second quarter 2025 adjusted1 EBIT of $76 million.
- Adjusted1 EBIT increased primarily from metal margin expansion, restructuring benefit, and other favorable items, most of which are not expected to repeat in future quarters. EBIT margin was 8.0%, down from 8.5% in the second quarter of 2025, and adjusted1 EBIT margin was 8.9%, up from 7.1%.
Second quarter EPS was $.33, a $.05 decrease versus second quarter 2025 EPS of $.38. Second quarter adjusted1 EPS was $.39, up $.09 versus second quarter 2025 adjusted1 EPS of $.30.
| Second Quarter Results 1 | ||||||||||||||
| EBIT (millions) | EPS | |||||||||||||
| Bedding | Specialized | FF&T | Other | Total | ||||||||||
| 2Q26 | 2Q25 | 2Q26 | 2Q25 | 2Q26 | 2Q25 | 2Q26 | 2Q25 | 2Q26 | 2Q25 | 2Q26 | 2Q25 | |||
| Reported results | $42 | $27 | $19 | $39 | $29 | $24 | $(10) | $— | $80 | $90 | $.33 | $.38 | ||
| Adjustment items: | ||||||||||||||
| Gain on sale of real estate | (11) | (17) | — | (2) | — | — | — | — | (11) | (19) | (.06) | (.10) | ||
| Restructuring, restructuring-related, and impairment charges | 6 | 2 | 3 | 1 | 1 | 1 | — | — | 10 | 4 | .05 | .02 | ||
| Somnigroup merger costs | — | — | — | — | — | — | 10 | — | 10 | — | .07 | — | ||
| Total adjustments | (5) | (15) | 3 | (1) | 1 | 1 | 10 | — | 9 | (15) | .06 | (.08) | ||
| Adjusted results | $37 | $13 | $22 | $38 | $30 | $25 | $— | $— | $89 | $76 | $.39 | $.30 | ||
| 1 Calculations impacted by rounding | ||||||||||||||
DEBT AND CASH FLOW
- Net Debt1 was 2.6x trailing 12-month adjusted EBITDA1
- Total Debt at June 30 was $1.5 billion in three tranches of long-term bonds at $500 million each
- Operating cash flow was $46 million in the second quarter, a decrease of $38 million versus second quarter 2025, reflecting an expected larger investment in working capital and lower earnings
- Capital expenditures were $21 million
- Dividends were $7 million
- In May, Leggett & Platt’s Board of Directors declared a second quarter dividend of $.05 per share, flat versus last year’s second quarter dividend
- In July, Leggett & Platt’s Board of Directors declared a third quarter dividend of $.05 per share, flat versus last year’s third quarter dividend. The dividend will be paid on August 24, 2026.
SEGMENT RESULTS – Second Quarter 2026 (versus 2Q 2025)
Bedding Products –
- Trade sales decreased 1%
- Volume decreased 7%, primarily due to retailer merchandising changes and lower volume with a certain customer in Adjustable Bed, demand softness in U.S. and European bedding markets, and the decision during the fourth quarter of 2025 to walk away from a financially challenged customer in U.S. Spring. These declines were partially offset by higher trade rod and wire sales.
- Raw material-related selling price increases and currency benefit added 6% to sales
- EBIT increased $15 million and adjusted1 EBIT increased $24 million
- Adjusted1 EBIT increased primarily from metal margin expansion, favorable sales mix, temporary price-cost timing benefit in Specialty Foam, and restructuring benefit. These increases were partially offset by lower volume.
- We believe U.S. mattress market units were down low double digits in the second quarter
Specialized Products –
- Trade sales decreased 19%
- 2025 divestiture of Aerospace reduced sales 16%
- Volume decreased 4% from softer market demand
- Currency benefit increased sales 1%
- EBIT decreased $20 million and adjusted1 EBIT decreased $15 million
- Adjusted1 EBIT decreased primarily from earnings associated with the divested Aerospace business, currency impact, and lower volume
- Automotive volume was slightly below major market production in the quarter, driven by underperformance in Asia partially offset by outperformance in Europe and North America
Furniture, Flooring & Textile Products –
- Trade sales increased 1%
- Volume was flat with growth in Textiles offset by declines in Home Furniture, Work Furniture, and Flooring
- Raw material-related selling price increases added 1% to sales
- 2025 divestiture of a small facility in Work Furniture reduced sales <1%
- EBIT and adjusted1 EBIT increased $5 million
- Adjusted1 EBIT benefited from refunds of IEEPA tariffs that were paid during the eleven-month period they were in force. During that period, competitive pressures led to margin compression as cost increases, including tariffs, were not fully recovered through increased selling prices.
https://seekingalpha.com/pr/20609439-leggett-and-platt-reports-2q-2026-results
August 9, 2026
Somnigroup Call Highlights
Somnigroup anticipates $2.85-$3.15 adjusted EPS in 2026 while targeting Leggett & Platt close before end of Q3
Aug 06, 2026, 5:26 PM ETSomnigroup International Inc. (SGI) Stock
AI-Generated Earnings Calls Insights
Earnings Call Insights: Somnigroup International Inc. (SGI) Q2 2026
Management view
- “We are pleased to deliver a record second quarter in adjusted earnings per share” (Chairman of the Board, CEO & President Scott Thompson) as the company reported “net sales of $1.8 billion, adjusted EBITDA of $297 million and adjusted EPS of $0.58” while describing “a market that we believe to be down mid- to high single digits over prior years” (CEO Thompson).
- “Following very encouraging results from a 3-month pilot program of Kingsdown’s products in 200 Mattress Firm stores… we have expanded our relationship with Kingsdown” and expect the assortment “to be available in nearly 800 stores nationwide” over the next 6 months (CEO Thompson).
- “Dreams continued to strengthen its brand assortment… while managing through a difficult macro backdrop, a highly promotional competitive landscape and an ERP implementation” that “has created some transitory challenges” (CEO Thompson).
- “The launch will begin at the end of the third quarter and continue to roll out through the early 2027” and “most of the expected financial benefit will materialize in 2027 and beyond” for the new Stearns & Foster collection, alongside actions to “increase the entry-level price” and “focus on the higher-end products” (CEO Thompson).
- “In the second quarter of 2026, consolidated sales were a solid $1.8 billion, and adjusted earnings per share was $0.58, up 9% over prior year” (Executive VP & CFO Bhaskar Rao).
- “We’re expecting to close the transaction before the end of the third quarter” for Leggett & Platt, with management saying it is “expected to expand our addressable market” and “deliver immediate adjusted EPS accretion before synergies” (CEO Thompson).
Outlook
- “We expect adjusted earnings per share to be between $2.85 and $3.15 for the full year” and the range “contemplates a sales at the midpoint of approximately $7.6 billion after intercompany eliminations” (CFO Rao).
- Management updated demand assumptions: “our expectation is that the industry will be down mid-single digits” and the full-year outlook assumes “Tempur Sealy North America like-for-like sales growing low single digits, International business growing low single digits and like-for-like Mattress Firm sales down slightly” (CFO Rao).
- Margin and investment framework in the guide included “reported gross margin slightly above 45%” and an assumption that Tempur Sealy brands/private label are “in the mid-60s percent of Mattress Firm total sales” plus “approximately $690 million of advertising investments” (CFO Rao).
- Compared with last quarter, management lowered the full-year range from “between $3 and $3.40” (Q1) to “between $2.85 and $3.15” (Q2) and lowered the sales midpoint from “approximately $7.8 billion” (Q1) to “approximately $7.6 billion” (Q2), while shifting industry expectations from “flat to slightly down” (Q1) to “down mid-single digits” (Q2) (CFO Rao).
Financial results
- Segment detail included “net sales through Mattress Firm… approximately $922 million” with “same-store sales” that “grew slightly” and Mattress Firm “adjusted operating margin” that “declined 130 basis points to 6.5%” (CFO Rao).
- Tempur Sealy North America results included “sales were flat on a like-for-like basis” and “North American adjusted gross margins increased… to 61.8%” while the company said it achieved “$30 million of net benefit from sales and cost synergies” (CFO Rao).
- International results included “International net sales grew 2% on a reported basis” and “International operating margin declined 120 basis points to 12.4%” (CFO Rao).
- Cash flow and leverage updates included “record operating cash flow of $236 million and free cash flow of $182 million” and “consolidated debt less cash was $4.3 billion” with leverage ratio “2.99x” (CFO Rao).
Q&A
- Susan Maklari, Goldman Sachs: asked what drove “the decision to take the numbers down”; CEO Thompson cited “the industry trends in the second quarter were not as strong as we expected” and “Dreams, their ERP system was a little rougher than we expected,” plus “the Middle East activity”; CFO Rao added the midpoint assumes “the current trends… continue” and said the company “did take up our expectation” for sales synergies.
- Pedro Gil, Morgan Stanley: asked what drove North America margin expansion; CFO Rao pointed to “about $15 million” of cost synergies, stronger-than-expected “balance of sales at Mattress Firm,” and “productivity… doing more with less,” while noting continued investments “in the form of advertising or supporting the new Stearns line.”
- Rafe Jadrosich, BofA Securities: asked about EPS cadence; CFO Rao said the midpoint “would imply about a 10% year-on-year EPS increase” and that growth should be “more… in Q4 versus in Q3” given Q3 2025 was “strong.”
- Robert Griffin, Raymond James: asked about U.S. demand and channel shifts; CEO Thompson said “the large retailers are clearly taking share from the smaller retailers” and added “the web side of the industry has been challenged” while “brick-and-mortar” has done better; he also said Tempur stores “were up almost 3%” in Q2.
- Keith Hughes, Truist: asked about the “$10 million” commodity headwind and second-half pressures; CFO Rao said it was “as a result of the Middle Eastern crisis” and reiterated pricing was sized “to make up for the $10 million in the back half,” while describing “around $90 million of annualized inflation.”
- Peter Keith, Piper Sandler: asked about a K-shaped economy; CEO Thompson said “Entry-level bedding has been the hardest hit by far, and luxury bedding… has been very resilient” and linked financing costs to “selling more higher-end beds” and rates that “have ticked up.”
- Michael Lasser, UBS: asked about third-party pullback and complexity; CEO Thompson responded “No, we’re not seeing any significant impact” from third parties and called complexity “Oh, without question,” while saying Dreams ERP issues were “maybe another 1 quarter” and management is “delegating authority and responsibilities.”
- Bradley Thomas, KeyBanc: asked about the multiyear “24% CAGR to 2028” outlook; CEO Thompson said “I’m not going to update our perspective” and added that if updated, “we will lower the industry growth” but noted margins are “significantly better” than in that profile and capital allocation could add upside.
- Phillip Blee, William Blair: asked about initiatives beyond synergy targets; CEO Thompson said logistics work is “going well” with numbers potentially by “the year-end call,” real estate benefits are “minor” near term, and he expects “net new stores at Mattress Firm” going forward.
- Jeffrey Lick, Stephens: asked about July 4 weakness and the “E-shaped economy”; CEO Thompson called July 4 “kind of a dud” and said he does not think it was “any anything significant turning point,” and added Sealy Posturepedic sales were “good” while entry level remains pressured.
- Marius Morar, Zelman: asked about limits to e-commerce; CEO Thompson said “we have reached more of a natural size of e-commerce bedding” and added retailers have “gotten smarter” about not “chase sales with extremely low prices.”
- William Reuter, BofA Securities: asked about future M&A after Leggett; CEO Thompson said “We may never do another deal, or we may do some more deals” and emphasized discipline: “It’s always price” and the company would be “very disciplined” and could be “very aggressive in buying our stock” as leverage declines.
Sentiment analysis
- Analysts were slightly negative to skeptical on guidance and demand, pressing on what changed and short-term disruptions, including “the decision to take the numbers down” (Maklari) and questions on complexity and ERP issues (Lasser).
- Management tone was slightly positive in prepared remarks (“record second quarter”; CEO Thompson) and more explanatory/defensive in Q&A, using clarifiers such as “to be clear” and “Oh, without question” when addressing complexity (CEO Thompson).
- Versus Q1, the dialogue shifted from reaffirmation to explaining a lower guide and calling out specific negatives (weaker Q2 industry, U.K. ERP, July 4 softness, and Middle East uncertainty) (CEO Thompson; CFO Rao).
Quarter-over-quarter comparison
- Guidance language and assumptions shifted from Q1 “reaffirmed 2026 earnings guidance” to Q2 addressing a “revision to the guide” and factors behind the reduction, with Q2 incorporating a faster Leggett timeline: Q1 expected close “by year-end” vs. Q2 “before the end of the third quarter” (CEO Thompson).
- Operational narrative changed in the U.K. as Q1 described Dreams as having “healthy order volume” and “outperformed the market” while Q2 emphasized an ERP rollout that “has created some transitory challenges” amid a “highly promotional” environment (CEO Thompson).
Risks and concerns
- Management cited demand volatility and promotional disruptions: “the July 4 holiday period… was weak” and added that “the Middle East activity… has created some additional uncertainty” (CEO Thompson).
- Execution risks highlighted included Dreams ERP as “a little rougher than we expected” with mitigation framed as transitory: “the system is functioning” and management expects it is “maybe another 1 quarter” issue (CFO Rao; CEO Thompson).
- Input cost pressures were described as an inflation headwind tied to geopolitical events, with mitigation through pricing: “We implemented modest pricing actions following the July 4 promotional period” and management expects second-half pricing to offset the earlier impact (CFO Rao).
Final takeaway
Management framed Q2 as resilient performance in a weaker-than-expected market, while lowering full-year guidance alongside a more cautious industry view and pointing to specific pressure points in the U.S. holiday cadence, U.K. ERP disruption at Dreams, and geopolitical-driven commodity volatility. The company reiterated cost and sales synergy execution, emphasized strong cash generation and a return to the target leverage range, and highlighted an accelerated timeline to close the Leggett & Platt transaction before the end of Q3, which management said will be incorporated into guidance after closing and is expected to be immediately accretive to adjusted EPS before synergies.
August 4, 2026
Urethane Highlights from Huntsman Call
Huntsman Corporation (HUN) Q2 2026 Earnings Call Transcript
Jul 31, 2026, 1:03 PM ETHuntsman Corporation (HUN) Stock
Q2: 2026-07-30 Earnings Summary
EPS of $0.00 misses by $0.06
| Revenue of $1.66B (14.06% Y/Y) beats by $56.62M
Huntsman Corporation (HUN) Q2 2026 Earnings Call July 31, 2026 10:00 AM EDT
Company Participants
Ivan Marcuse – Vice President of Investor Relations & Corporate Development
Peter Huntsman – Chairman, President & CEO
Philip Lister – Executive VP & CFO
Peter Huntsman
Chairman, President & CEO
Ivan, thank you very much, and thank you, everybody, for taking the time to join us this morning. It’s been 3 months since the last time we were able to report on market conditions and what we were doing as a company to enhance shareholder value. Needless to say, it has been a rather busy few months on a number of fronts. I’d like to comment on a few things, but I plan to be brief as your questions and comments are the reason for this call.
I stated during our last quarter’s call that while I was heartened to see the prices and margins were improving across most of our product lines, I emphasize the need for “stable and long-term demand trends to continue”. While we improved our margins from the first quarter, I remain concerned as to the growth rates and consumer confidence that we are seeing.
Since our last call, North American housing stats have softened and Chinese consumer confidence continues to languish. Europe continues its ill-fated energy policy and all that free wind is now costing European consumers and industry near-record amounts. As ongoing conflicts in the Middle East seemingly move weekly from a ceased fire to all-out war, moving energy prices, stock markets and consumer sentiment with each action, we continue to keep a wary eye on inflation and consumer spending, especially on durable goods. It seems much of this turbulence will continue through the third quarter.
While this is playing havoc on costs and order patterns, it is also demonstrating the value of reliable supply lines contractual assurance of supply and the value of pricing and consistent quality. We will continue to push for greater margins as we believe that this industry still has a lot of room for improvement.
In the — on the 16th of June, we announced a merger of equals with Olin Corporation. Since that time, we’ve had the opportunity to visit one-on-one with the majority of our largest shareholders. If I had to summarize my feelings towards this transaction, it would be in the answer that I shared when I was asked if I could do anything different than what had been done. My response was that I wish I had met Ken Lane a year earlier and that we were here today earning materially more than we otherwise would be earning. Regardless of market conditions, whether they improve or continue to languish, our company and shareholders will be better off with this proposed merger. If this transaction was a year behind us, we would be today, well on our way to achieving an additional $300 million in synergies.
We would be earning more through newfound commercial opportunities that are not even part of our $300 million in synergies. We would have a stronger balance sheet that would be improving quarter-by-quarter. In short, should today’s market conditions continue through next year, we will be better off than we are today. Should markets improve, we will be the benefactors of not only the forthcoming synergies, but also higher combined volumes and greater integration.
Either way, this positions us to improve regardless of market conditions. I have been impressed with the strong collaboration and interaction between the Huntsman and Olin teams that are advancing our closing at a rapid pace. Our teams will be ready on day one of closing to commence with achieving our outlined synergies. Between now and closing, we will continue to focus on creating as much shareholder value as possible. Following the completion of this transaction, we’ll be able to achieve far more.
Frank Mitsch
Fermium Research, LLC
I was wondering if you could update us on the state of the MDI business from a demand and a supply standpoint, particularly on the supply side, given what’s been going on with the Iranian conflict. How do you see that — how did you see that impact 2Q? What are your expectations for 3Q and beyond?
Peter Huntsman
Chairman, President & CEO
Well, I think on 2Q, we had the ability to be able to put prices up. Much of that was to recover the increase of raw materials that we were seeing at the time, but we were also able to get ahead as our results indicate that we’ve nearly doubled our EBITDA since second quarter of last year. Look, on a supply basis, we obviously have a large global MDI plant that is on the wrong side of the Strait of Hormuz, I would say. And that is probably representing somewhere around 4% of industry average.
So from a supply point of view, Frank, I think that it’s pretty well balanced. My disappointment, if I have one, is that we’re not seeing greater demand and greater improvement in the macroeconomic situation. I don’t want to be overly dire on this. I’m just saying that yes, on the supply side, I think it’s pretty well balanced. On the demand side, I’d like to see a little bit more. Right now, depending on where you are around the world, you’re probably seeing anywhere from 0% to 2% very low single-digit sort of growth that is taking place. So an improved economy, improved housing demand, particularly in North America would be very helpful, return consumer confidence in Asia would be very good to see. And frankly, improved sentiment — consumer sentiment and lower energy inflation in Europe, I think would all be benefactors this time.
Hassan Ahmed
Alembic Global Advisors
First question on polyurethanes. Obviously, a lot of stuff moving around. I mean we’ve seen some TDI outages. I would imagine that may result in some incremental demand on the MDI side of it, then we’ve obviously seen some outages in MDI itself. So just in terms of effective utilization rates, where do you see the industry and should it be relatively snug over the next quarter or 2? And part and parcel with that, I know you guys have taken some pricing actions in Europe in particular. But obviously, nat gas prices, they continue to rise. So I mean, will you guys be EBITDA positive over there after the price actions? And will the industry over there be EBITDA positive as well.
Peter Huntsman
Chairman, President & CEO
Well, if I had — Hassan, thanks very much. Good question. If I had to look at the market today in the snapshot, I would say that, yes, Europe with the pricing actions and with the cost structure that we have, Europe should be positive as we look into the third quarter. Now again, over the last couple of weeks here, and I’m talking the last 2 or 3 weeks, I’ve seen gas in Europe go from about $13, $14 per MMBtu rise above $20 per MMBtu. Now should it continue to do that, should electricity continue to rise at these rates. I don’t believe that will be the case. But if they were to continue, that obviously is going to pose some headwinds. That’s my biggest concern around Europe right now on a macro basis or energy costs and overall consumer demand. It’s tough to get prices up when you see demand going down and — or languishing and people are obviously fighting over a shrinking pie.
So as I think about Europe, I continue to be optimistic that we will be EBITDA positive in the third quarter there. As you look at it on a macro basis, I would imagine without looking at industry data because there’s not a whole lot that’s published, we’re probably operating in a capacity utilization rate somewhere in the mid-80s on a global basis.
Some areas, I think in the U.S., it’s tighter than that. I think in Europe, it might be a little looser than that. Asia is probably right on top of that. There have been a number of outages that are around. And again, if demand were rising at traditional levels of 4% to 6% per annum sort of growth rate, I think you’d see much tighter markets than today.
Matthew DeYoe
BofA Securities, Research Division
Good morning, everyone. Can you talk through the potential impacts of the antidumping duties on U.S. MDI and whether you think that lends to a higher floor over time for that business, what that floor could ultimately look like?
Peter Huntsman
Chairman, President & CEO
I think that — well, what the floor ultimately looks like. I don’t want to — I wouldn’t speculate on that, not that I’m trying to avoid an answer as much as I just simply don’t know, but it ought to be better than where we were a year ago. But let’s also be honest, I believe that you’re going to need demand to pick up.
You’re going to need housing to get back to a more normalized run rate to see any real material benefit come from this. And let’s remember, there’s a lot of MDI that’s exported from the United States. It goes into Canada that goes into Mexico. It goes into Latin America and so forth.
There are still imports from around the world that are going into those regions. And for every ton that goes into those regions and pushes U.S.-produced MDI back from those regions back into the United States market. I mean, we can say that, that export-oriented MDI is not coming to the U.S., but it kind of is in a roundabout way, right? And so I think that a lot of people were expecting as soon as this was implemented and put into place, you’re going to see a benefit the next quarter.
Now this is something that will play out over a multi-quarter basis. And you’ll see the greatest benefit of this come about when demand returns and housing returns to a more normalized basis.
Matthew DeYoe
BofA Securities, Research Division
Appreciate the answer, Peter. And I’ve been jumping around a little bit, so I apologize if I missed it, but polyol pricing was pretty strong in the quarter. You had an outage, obviously, one of the large competitors, which tightened a fair amount of the market. What was the benefit there? What does that look like in 3Q, 4Q? How is that market managing all that because we also heard some customers on the coating side talking about these shortages domestically as well.
Peter Huntsman
Chairman, President & CEO
I wouldn’t say that it was — I heard a lot more horror stories than I think actually happened to the industry. Look, our impact and benefit would be in the low $2 million to $3 million sort of a range — so yes, I’m not sure that it was as big of a deal as some maybe put it out in the media.
David Begleiter
Deutsche Bank AG, Research Division
Peter, U.S. MDI supply disruptions in Q2 helped you guys as these disruptions come back online in Q3. Is there a way to quantify the impact to you guys quarter-over-quarter?
Peter Huntsman
Chairman, President & CEO
Yes. I’m — we — I wish I could say that we had 100% operating rates during the quarter as well. we had some minor issues, I believe that were reported. But I think across the industry going from second quarter into third quarter, there’s quite a bit of inventory going into second quarter. That was built up for a housing season that really didn’t take off as much as probably some anticipated. Bottom line, I don’t see a whole lot of impact with those restarts going into the third quarter. It looks like it’s pretty flat from a demand — or from a supply/demand basis.
Matthew Blair
TPH Research
Thanks and good morning, Peter. Would you say that spray foam is holding up relatively well despite the tough construction environment. I think the prepared remarks mentioned some new wins in select markets. Could you elaborate a little bit more on that?
Peter Huntsman
Chairman, President & CEO
Yes. I think that the spray foam, we’ve got excellent leadership in spray foam that’s done a phenomenal job and looking and making their supply chain more efficient, their cost better. And most importantly, their marketing and their sales have been very effective in a lethargic construction environment. We’re seeing low double-digit growth continue to consistently take place. in spray foam energy efficiency. I think that I’m a bit disappointed as to where we were 2 years ago in that business. But I look at where we are today and they’re hitting on all cylinders. They’re doing a great job. So it’s been a great business for us.
Abigail Eberts
Wells Fargo Securities, LLC, Research Division
Again, trying to focus on the positives and polyurethanes. Can you speak to the underlying trends driving the growth in the industrial side of the market that you’re seeing?
Peter Huntsman
Chairman, President & CEO
Yes, Abigail, thank you very much. As we think about the industrial growth for us, that’s mostly our elastomers business, smaller volumes but much better margins there. And as we see that on a second quarter versus the prior year. In our lastomers business, we’re up double digits in Asia, Europe and in the Americas. So again, that’s going to be a lot of your coatings, a lot of your specialty coatings, adhesives and so forth. Think about when you put coatings on the back of a pickup truck and you’re looking at industrial coatings. So these are fast-growing markets. We’ve got great innovation in these areas and a strong customer base.
Arun Viswanathan
RBC Capital Markets, Research Division
Yes, I just wanted to go back to the supply/demand in MDI and we are seeing still some continued — would you characterize the market still in slightly oversupplied situations? And is that mainly rectified through demand improvement? I think you referenced that earlier, but — are there any supply actions that you think would be required at this point?
Peter Huntsman
Chairman, President & CEO
No, I think — I believe that it’s pretty well balanced. There’s not a lot of new capacity that’s come on. Industry — look, the industry continues to grow, but it’s just growing at a much slower pace than it has in years past. And what it means is North American housing durable goods. It needs Asia domestic economy to come back and European consumerism to return.
Arun Viswanathan
RBC Capital Markets, Research Division
And then I guess when you look out into downstream spray foam and maybe some of the system houses capacity that you have, would you also characterize that as balanced? And does that — and are tight and does that lead to potentially some some greater pricing opportunities downstream, but is it the case that you’re just not able to take advantage of that because of weak demand as well.
Peter Huntsman
Chairman, President & CEO
Yes. I think those areas continue to be well balanced. Look, it’s always a — as you go further downstream, there’s always plenty of competition. And you’re always in a race to make sure that as products are commoditized as you’ve got a healthy supply chain of new products, new ideas, new innovation. And I think that we do a good job in that area. But it’s a good balance, I think, between — as things go commodity and as you have new opportunities and new innovation going in.
Michael Harrison
Seaport Research Partners
Wanted to ask about polyurethanes pricing in the Americas. Can you give us a sense of what portion of your contracts turn over every quarter — and are there any actions that you can take to maybe work around the contract structure, things like surcharges? Or is there some kind of an opener that would allow you to renegotiate the terms.
Peter Huntsman
Chairman, President & CEO
Yes. About 40% of our contracts are formula, meaning that they’re going to be on a longer than a quarter-to-quarter basis. Now those open up on anywhere from every 6 months, every 12 months where you can renegotiate what you’re charging somebody. But those are designed to be able to take in and absorb benzene and natural gas prices and so forth. So as you think about that, about every 6 to 12 months, most of these contracts will have a pit stop where you can pull over and renegotiate, if you will, which I’m not a big fan of either of those, I’d rather have it where we can move prices instantaneous with market conditions. But — we are where we are in polyurethanes that’s largely dictated by competition.
But yes, we are aggressively moving on surcharges on everything and everywhere that we can. And at the same time, we also want to make sure that as you think about your customer relationships that you’re taking care of your customers because if you’re taking advantage of them today, the table turn pretty quickly in this industry. So yes, we do honor our contracts. We do honor our pricing formulas that we entered into. It doesn’t mean I’m always happy with those, but it is what it is.
Michael Harrison
Seaport Research Partners
And then I was hoping you could also provide some more color on how the situation in the Middle East is impacting your PO MTBE business in China. It looks like there was a nice benefit in the second quarter. And I’m just curious, would you expect the third quarter benefit to be greater than what you saw in Q2?
Peter Huntsman
Chairman, President & CEO
I think you’re probably going to be flat Q2 to Q3. A lot of the gasoline supplies oxygenated levels and values and so forth. To some degree, those are going to be government dictate. And so it’s not as free-flowing. I would say, as you would see in the Americas or even in Europe. But I’d say, from Q2 to Q3, it’s going to be flat.
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