Huntsman Corporation

Greetings. Welcome to the Huntsman Corporation third quarter 2023 earnings call. At this time, all participants are in a listen-only mode. The question and answer session will follow the formal presentation. If anyone should require operator assistance during the call, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. At this time, I would like to hand the call over to Ivan Marcuse, Vice President of Investor Relations and Corporate Development. Thank you. You may begin.

Thank you, Daryl. Good morning, everyone. Welcome to Huntsman's Third Quarter 2023 Earnings Call. Joining us on the call today are Peter Huntsman, Chairman, CEO, and President, and Phil Lister, Executive Vice President, CFO. Yesterday, October 31st, 2023, after the U.S. equity markets closed, we released our earnings for the third quarter 2023 via press release and posted it to our website, Huntsman.com. We also posted a set of slides and detailed commentary discussing the third quarter on our website. Peter Huntsman will provide some opening comments shortly. We will then move into the question and answer session for the remainder of the call. During the call, let me remind you that we may make statements about our projections or expectations for the future. All such statements are forward-looking statements, and while they reflect our current expectations, they involve risks and uncertainties and are not guarantees of future performance. We shall review our filings with the SEC for more information regarding the factors that could cause actual results to differ materially from these projections or expectations. We do not plan on publicly updating or revising any forward-looking statements during the quarter. We will also refer to non-GAAP financial measures such as EBITDA, adjusted net income or loss, and free cash flow. We can find reconciliations to the most directly comparable GAAP financial measures in our earnings release which has been posted to our website, huntsman.com. I'll now turn the call over to Peter Huntsman.

Ivan, thank you very much, and thank you all for taking the time to join us this morning. This past week, I had the opportunity to visit one of our largest aerospace customers with our board of directors. We watched firsthand as Huntsman's composite raw materials were applied to some of the most fuel-efficient and modern aircraft built anywhere in the world today. We also visited one of our plants, that is making Germany's premier sports cars lighter and consume less electricity. We spoke to our associates at the same plant who are responsible for making components for a smarter, more reliable power distribution and grid system. I can go on about the numerous applications that Huntsman is now producing to serve a less energy intensive, but more energy reliant economy. All of this gives the cause for optimism, and it's a great reminder about our company's position in the global marketplace. Over the past 24 months, we've seen some of the strongest economic performance as we recovered from a global pandemic and subsequently among the most chaotic economic conditions as European energy policy seemingly collapsed. China's bounce back stumbled along, and North America's construction markets took a beating over high interest rates and consumer uncertainty. As we now have some visibility into the beginning of the fourth quarter, as I said during our last earnings call, we expect this to be a tough quarter depending on the amount of customer de-inventoring we see and lack of consumer confidence. Our projections for the fourth quarter remain murky. as the real year-end seasonality does not yet start for a couple more weeks. However, our customer and plant visits demonstrate just how vital our products are in an evolving global economy. We continue to see the recovery of the aerospace industry. In all of our other divisions, we will be a vital supplier to both the EV and ICE automotive industry. We continue to see growing demand in power and electronics. building insulation materials, cleaner solvents for the chip industry, and expanding markets for lightweight and stronger materials. We will pace our share buyback program to make sure we are both returning value to our shareholders and preserving a strong balance sheet that will assure our flexibility and allow us to capitalize on M&A opportunities. During 2024, we will complete a $280 million cost realignment in European restructuring program we announced over the past two years. This will help offset inflation, flatten organization, and allow us to compete more aggressively and respond quicker to market conditions. As mentioned in our prepared remarks, we will be very conservative on our capital spend this next year. We will spend what is needed to assure our reliability and safety, as well as investing in high priority growth projects. Depending on the speed of an expected recovery in 2024, we will be ready to proceed with other projects as market conditions may warrant. In short, as we conclude what has been a year with more challenges and opportunities, we believe that we're in a unique position to rebound quickly as markets shift direction. We will also be calibrating our operations around a conservative approach to spending and capital allocation with an eye towards long-term shareholder return and reliability. Thank you very much. And with that, we will open the lineup for questions. Operator?