The Woodlands, Texas – Huntsman first quarter numbers are down by $70-75m when the first quarter of 2019 is compared to the 2018 period because of the 2018 MDI price spike.
Huntsman profit and earnings suffer in comparison to unusual Q1 2018
That was a key message from CEO Peter Huntsman to financial analysts in a conference call on 30 April.
Earlier in the day, the company had announced first quarter 2019 sales down 11.4% on the same period in 2018, and EBITDA down by 12.7%. At the time, Huntsman said low MDI prices had hit the 2019 numbers.
Peter Huntsman said that, although prices fell, volumes grew in the first quarter of 2019. 'We grew our overall MDI volumes by 6%. Our downstream differentiated strategy is performing as we have intended. We saw continued stable margins in the predominant differentiated end of our portfolio,' he added.
Total volume of undifferentiated MDI sold grew by 15% quarter to quarter, he said.
'We have not seen a material change in the long-term fundamentals of the MDI market,' he said. 'We continue to see industry growth of 5% to 6%/year.
However, the growth in new capacity will be a little lower. Peter Huntsman pegged it at about 4–5%. This means that the industry will be operating at high levels in 2019. He suggested that the company's US assets will be 'operating in the upper-90s. Europe is probably going to be somewhere right around 90%, high-80s, 90%. And Asia is probably going to be around 80% of capacity'.
Second quarter performance should be 'well in excess of 20% stronger in the second quarter', he predicted.
In addition, the company will commit $125m from its capital expenditure budget on a new splitter in Geismar, Louisiana. It should have a transformative effect on Huntsman's business in North America when it comes on stream in 2021, he promised.