Huntsman Corporation

Greetings, and welcome to the Huntsman fourth quarter 2025 earnings conference call. At this time, all participants are in listen-only mode. A question and answer session will follow the formal presentation. You may be placed in the question queue at any time by pressing star 1 on your telephone keypad, and we ask that you please ask one question and one follow-up, then return to the queue. As a reminder, this conference is being recorded. If anyone should require operator assistance, please press star 0. It's now my pleasure to turn the call over to Ivan Marcuse, Vice President, Investor Relations and Corporate Development. Please go ahead, Ivan.

Thank you, Kevin, and good morning, everyone. Welcome to Huntsman's fourth quarter 2025 earnings call. Joining us on the call today are Peter Huntsman, Chairman, CEO, and President, and Phil Lister, Executive Vice President, CFO. Yesterday, February 17, 2026, we released our earnings for the fourth quarter 2025 via press release and posted to our website, Huntsman.com. We also posted a set of slides and detailed commentary discussing the fourth quarter on our website. Peter Huntsman will provide some opening comments shortly, and 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. You should 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 adjusted EBITDA, adjusted net income and loss, and free cash flow. You can find reconciliations to the most directly comparable GAAP financial measures in our earnings release, which has been posted to our website. I will now turn the call over to Peter Huntsman, our Chairman, CEO, and President.

Ivan, thank you very much. As we reviewed 2025 results, I think it is worth commenting on a bit on this past year and on our focus on 2026. I often end my prepared remarks with these words. We will continue to focus on what we can control and where we can create value. I do not say this to be repetitive, but rather to emphasize where our focus needs to be. Our industry started this past year, 2025, with optimism that North American housing was going to pick up, Chinese consumer confidence was going to recover, and Europe would finally realize their follies and do something to reinvigorate their industrial competitiveness. Instead, shortly after our call, Liberation Day was announced and markets and consumer confidence was thrown into chaos. China repositioned and rechanneled their trade and stood toe-to-toe against the U.S. while their domestic market slowed. Europe policymakers focused on what was making them uncompetitive and decided to double down and lost a record amount of chemical production throughout the year. In North America, we saw U.S. housing and durable goods struggle to show any growth. Despite these hurdles, we continue to cut and restructure our cost basis, closing multiple facilities. We achieved growth in most of our tonnage that exceeded the general market while attempting to lead multiple price increases. And perhaps most importantly, we converted 45% of our EBITDA to free cash flow, a higher percentage than many in the industry. As we look out over 2026, we anticipate a gradual recovery in North American home building and durable goods. as well as an improvement in the Chinese domestic markets. We are seeing some very early signs of both improved volumes and pricing in Europe. It is too early to say these increases will fully materialize, but we remain hopeful. While we don't control the outcome of these large macro changes, we will be more than ready to take advantage of any opportunities to expand margins and increase revenues should they come along, and by focusing on those items we can control and conditions we can influence. On the strategic front, I believe that 2026 will continue to be another year of changing market dynamics. Even if we start to see a recovery, we will likely see further opportunities for mergers, joint ventures, and industry consolidation. As always, we will be willing to engage with interested parties and push where there is an opportunity for value to be created. We will not be sitting on the sidelines waiting to see what comes along. Like 2025, we have set expectations internally to, at a minimum, generate enough cash to cover our dividend. This requires more than just moving inventory about, and we will continue to be focused on further structural change in how and where we do business to accomplish this. With regards to pricing and growth, we will push to grow our assets at a better pace than the general industry and do this by winning business through new product development and innovation, pushing to fill out capacities and upgrade materials through our MDI splitter in Geismar, capacity increases in high purity of means for the tech industry and catalysts, and expanding capabilities in material usage in aerospace, power, in the fast evolving auto industry. We will also be selectively using AI tools, if they make economic sense, to further reduce our costs, simplify our processes, and expand our R&D capabilities. In short, I hope that 2026 will be a year of recovery compared to 2025. The coming weeks should signal to what degree we will see demand returning to the North American construction industry and China's moves following the Chinese New Year's, the March National People's Congress, and President Trump's visit to China in early April. The next several weeks should be anything but boring. With that, operator will open the call up for questions and comments.