Epoxy
May 5, 2023
Huntsman Epoxy Comments from Investors Call
Huntsman Corporation (HUN) Q1 2023 Earnings Call Transcript
May 05, 2023 2:30 PM ETHuntsman Corporation (HUN)
136.83K Followers
Q1: 2023-05-05 Earnings Summary
EPS of $0.20 beats by $0.06 | Revenue of $1.61B (-32.78% Y/Y) misses by $65.15M
Huntsman Corporation (NYSE:HUN) Q1 2023 Results Conference Call May 5, 2023 10:00 AM ET
Company Participants
Ivan Marcuse – Vice President of Investor Relations
Peter Huntsman – Chairman, President, and Chief Executive Officer
Phil Lister – Executive Vice President and Chief Financial Officer
Peter Huntsman
With that, let’s turn to Slide number 7. Advanced Materials reported adjusted EBITDA of $48 million in the quarter, an increase of $7 million versus fourth quarter and down versus the prior year due primarily to lower sales volumes. Destocking appears largely behind us, though we continue to see pressure on our infrastructure coatings market. Total volumes increased quarter-on-quarter and drove the adjusted EBITDA improvement.
The sales volume decline of 21% was due in part to our ongoing reduction of bulk liquid resin commodity sales. Our core specialty business was down but less than the segment average. The Americas was the weakest region due to depressed demand, primarily from our coatings, adhesives, and general industrial markets. Our aerospace business continues to demonstrate improving trends. Sales were stable compared to quarter 1 of 2022, primarily due to some supply chain constraints and timing impacting sales in the quarter.
Our order backlog is solid, and we expect growth as we move through the rest of 2023 and into 2024. The increase in demand for our products is heavily relied to widebody production rates, which have positive tailwinds with increased travel and new airplane orders from airlines. Our expectations remain that this important and profitable sector will return to pre-pandemic levels during 2024.
We continue to seek out bolt-on acquisitions for Advanced Materials to grow and expand the overall portfolio as well as improve the overall returns of the business. We are also continuing to move forward with organic investments, such as our MIRALON business, which provides an innovative technology to capture methane, turn it into hydrogen and a carbon material that can be utilized across many different markets. While still in development, we expect to aggressively scale this business over the coming years.
With lower destocking and seasonal improvements, we expect Advanced Materials to deliver improved results in the second quarter versus the first quarter. We expect second quarter adjusted EBITDA for this division to be in the range of $50 million to $56 million, with improved EBITDA margins.
May 1, 2023
Olin Discussion
Olin Corporation (OLN) Q1 2023 Earnings Call Transcript
Apr. 28, 2023 12:42 PM ETOlin Corporation (OLN)2 Comments
136.48K Followers
Q1: 2023-04-27 Earnings Summary
EPS of $1.52 beats by $0.22 | Revenue of $1.84B (-25.07% Y/Y) misses by $204.49M
Olin Corporation (NYSE:OLN) Q1 2023 Results Conference Call April 28, 2023 9:00 AM ET
Company Participants
Steve Keenan – Director, IR
Scott Sutton – CEO
Todd Slater – CFO
Scott Sutton
All right. Thank you, Steve, and good morning, everybody. The Olin team is deeply engaged in doing what we said we would do, which is to establish a new 12-month trough EBITDA level that is significantly higher than previous peaks and additionally supports a higher equity valuation. We are halfway through that demonstration after back-to-back quarters where our EBITDA delivery was $442 million in the fourth quarter and $434 million in the first quarter.
Market conditions are quite poor, and the forward outlook of those conditions is for more of the same. But Olin is busy adjusting our market participation across the ECU to support product values fixing our prior shortfall of not recession-proofing the Epoxy business while simultaneously growing Epoxy systems and correcting commercial ammunition channel loads and landing new military business in Winchester.
Referring to Slide number 5 in our earnings presentation. The initial evolution of Olin to a higher level value state is also about halfway along. Leadership behavior in all three of our businesses through this recessionary environment will lead to more value growth opportunities that, in turn, deliver more firepower for share repurchases. We are currently on a run rate to repurchase 10% of the Company’s outstanding equity this year after repurchasing 16% in 2022.
Kevin McCarthy
Scott, you’ve taken a number of actions toward restructuring your Epoxy business. Can you talk through what you’ve done already and what lies ahead? I think there was a reference in your materials to some additional restructuring actions. It wasn’t clear as to whether that was in addition to what you communicated several weeks ago or just additional implementations against that existing communication?
Scott Sutton
Yes. Sure. Thanks a lot. So we have taken some recent actions to really recession-proof the Epoxy business. And so in March, we announced that the Terneuzen and Cumene plant and our solid epoxy resins facilities in Korea and Brazil are to be closed. And you see that we took a restructuring charge of almost $60 million in the first quarter to do that. We had additionally also closed one BPA facility in our Stade, Germany plant. And there’s more to come. We’re going to have additional asset decisions to make. And then we’re going to also change the way that we go to market in the Epoxy business as well. So, that’s going to happen through the course of this year.
Kevin McCarthy
Okay. And then secondly, perhaps for Todd. Can you speak to the inventory levels on your balance sheet? Optically, it looks like they’re up 20% year-over-year. How much of that is underlying escalation of inventory versus other factors. I’m not sure if your Blue Water joint venture establish an affects any of those numbers?
Todd Slater
Kevin thanks for the question on inventory. We normally build inventory and working capital during the first part of the year and liquidate that late in the third and fourth quarter. The inventory levels are higher than that normal seasonal activity this year because of a major turnaround as planned that we built some inventory in advance of that turnaround. You should expect those levels to decline as the year unfolds with a step down you’ll see in June.
Unidentified Analyst
So, I wanted to follow up on Kevin’s question earlier, Scott. Have you settled on maybe a more permanent vision for what the optimal footprint looks like for the Epoxy business, particularly with regards to an appropriate level of vertical integration?
Scott Sutton
Yes. Yes, I mean, thanks for the question. And look, I mean, as we go through this restructuring, right, we’re going to get to a footprint and a business presence that removes some element of the duplication that we have two of every single kind of assets all across that vertically integrated change. And we may or may not need all of those to have full capability. But what I’ll say, when we get through this Epoxy is still going to be the absolute global leader in that world. And it’s still going to be the absolute most vertically integrated business in that world as well.
Epoxy has certainly been challenge. If you go a little bit backwards in time, whenever Asia volumes became available, customers bought away. And then when those Asian volumes weren’t available because of instability or demand in Asia, they came back to Olin for security of supply. More recently, we probably overpriced a bit for a bit too long. So, now we’re just moving to a point where we’re going to partner with Epoxy customers for a bit longer run, and there’s going to be a lot more cooperation in that forward world with Epoxy customers, especially as our business pivots more to value from systems, so you need to have a longer-term profile mix with customers.
Mike Leithead
First on Epoxy. Scott, can you just maybe talk about where the Chinese export pressure currently stands today versus maybe a quarter ago? And just where you think that trends over, say, the next quarter or so?
Scott Sutton
Yes, sure. I mean, look, that export pressure, I’ll say, in the second quarter is probably even more than in the first quarter. There’s record Epoxy exports coming out of Asia. And those exports out of Asia are being driven by the fact that China has added a lot of capacity. They’ve got their supply apparatus running hard, yet their demand apparatus has not turned back on.
So that sort of reversal in trade flows out of China has caused the rest of the volume in Asia to come towards Europe and North America. So that’s the impact we’re seeing, and we see extreme pressure continuing there.
John Roberts
On Slide 9, the ECU PCI declined sequentially from 287 down to 262. But almost all the chlorine caustic products went up sequentially. So, epoxy was big enough and declined enough that it offset all the gains in the other products sequentially.
Scott Sutton
Yes. I mean, John, Epoxy was a big driver of that because per ECU, there was less delivery of contribution profit. So in epoxy, not only do you have price declines, but you have volume declines as well. So you get the impact of volume and price coming through there.
March 21, 2023
Olin Closing Epoxy Facilities
Olin Announces Epoxy Facility Closures as Part of On-Going Restructuring Program
Mar. 21, 2023 4:05 PM ETOlin Corporation (OLN)
CLAYTON, Mo., March 21, 2023 /PRNewswire/ — Olin Corporation (NYSE: OLN) announced today that it has made the decision to cease operations at its Cumene facility in Terneuzen, Netherlands and solid epoxy resin production at its facilities in Gumi, South Korea and Guaruja, Brazil. Olin’s first quarter 2023 results are forecast to include approximately $57 million of restructuring charges associated with these plans of which approximately $15 million of these restructuring charges represent non-cash asset impairment charges. The cash component of these charges is expected to be paid over the next three years.
“This is another step to right-size our global Epoxy asset footprint to the most cost-effective asset base to support our strategic operating model,” remarked Scott Sutton, Chairman, President, and Chief Executive Officer. “Our Epoxy business continues to experience weak global epoxy demand and excess supply availability. This action reinforces our commitment to lift our Epoxy business earnings to a more sustainable level. We will continue to evaluate and execute additional actions that right-size the business to achieve reinvestment economics across our Epoxy portfolio.”
March 21, 2023
Auto Sales Rebound in January
March 14, 2023
Univar Solutions Going Private
Univar Solutions to be Acquired by Apollo Funds for
$8.1 Billion
3/14/2023
Shareholders to Receive $36.15 Per Share in Cash
DOWNERS GROVE, Ill. and NEW YORK, March 14, 2023 /CNW/ — Univar Solutions Inc. (NYSE: UNVR) (“Univar
Solutions” or the “Company”) and Apollo (NYSE: APO) announced today that funds managed by affiliates of Apollo
(the “Apollo Funds”) have entered into a definitive merger agreement to acquire the Company in an all-cash
transaction that values the Company at an enterprise value of approximately $8.1 billion. The transaction includes a
minority investment from a wholly owned subsidiary of the Abu Dhabi Investment Authority (“ADIA”).
The agreement provides that Univar Solutions shareholders will receive
$36.15 per share in cash, which represents a 20.6% premium to the Company’s
undisturbed closing stock price on November 22, 2022. The transaction
consideration also represents a premium of 33.6% to the volume-weighted average price of Univar Solutions for the
30 trading days ending on November 22, 2022.
“We are pleased to have reached this agreement with Apollo, which will provide immediate and certain cash value
for Univar Solutions shareholders,” said Chris Pappas, chairman of the Univar Solutions Board of Directors (the
“Board”). “The Board’s decision follows a comprehensive review of value creation opportunities for Univar
Solutions. We are conêdent this transaction is the right path forward and achieves our goal of maximizing value for
Univar Solutions shareholders.”
David Jukes, president and chief executive officer of Univar Solutions, said, “Over the last three years, we have
transformed the Company, putting the customer at the center of all we do, which has solidified our position as a
leading value-added service and solution provider. This transaction reflects the success of our strategy and delivers
substantial value to our shareholders. It is a testament to the tireless efforts of my colleagues, whose commitment
to our purpose of helping keep our communities healthy, fed, clean, and safe has enabled our success.
In Apollo, we are pleased to gain a partner to support continued investment in our portfolio and I look forward to working
closely with their team as we grow Univar Solutions and serve our key suppliers and customers globally.”
Apollo Private Equity Partner Sam Feinstein said, “Univar is a global leader in specialty chemicals and ingredients
distribution, fueling a vast array of industries with innovative, safe and sustainable solutions. In recent years, David
and his team have made tremendous progress enhancing the customer experience, and we believe Univar can
accelerate its long-term strategy as an Apollo Fund portfolio company. We look forward to leveraging our extensive
experience in the sector to support management in this exciting next phase.”
Transaction Details
The merger agreement, which has been unanimously approved by the Univar Solutions Board of Directors,
provides that Univar Solutions shareholders will receive $36.15 in cash for each share of common stock they own.
The transaction will be enhanced with equity provided by the Apollo Funds, a minority equity investment from a
wholly owned subsidiary of ADIA and a committed debt ênancing package.
The transaction is expected to close in the second half of 2023, subject to customary closing conditions, including
approval by Univar Solutions shareholders and receipt of regulatory approvals. The transaction is not subject to a
ênancing condition.
Upon completion of the transaction, shares of Univar Solutions common stock will no longer trade on the New York
Stock Exchange, and Univar Solutions will become a privately held company. Univar Solutions will continue to
operate under the Univar Solutions name and brand and maintain a global presence.
The foregoing description of the merger agreement and the transactions contemplated thereby is subject to, and is
qualified in its entirety by reference to, the full terms of the merger agreement, which Univar Solutions will file with
the U.S. Securities and Exchange Commission as an exhibit to a Current Report on Form 8-K.
Everchem Updates Archive 
Sign Up for Email Updates