The Huntsman group of companies will undertake a $200 million cost-cutting program over the next 18 months, with site consolidations and employee reductions to be announced soon.
The severe economic slump the chemical industry has been experiencing for the last three years continues unabated, says Peter R. Huntsman, president and CEO of the Huntsman companies. It offers, he adds, an opportunity to reposition our businesses at the bottom of the cycle to ensure their long-term competitiveness and profitability.
Each of six Huntsman chemical businesses has plans to help meet the overall minimum $200 million goal. The intention, Huntsman explains, is to manage the businesses so they can pay down debt, make interest payments, and invest in new projects. To do just that at this time last year, the Huntsman group cut a deal with its largest bondholder, handing over 49% of the company in exchange for eliminating $775 million in debt.
On a positive note, earnings for the Huntsman group stabilized between the second and third quarters. Third-quarter earnings before interest, taxes, depreciation, and amortization were $170 million, including $10.7 million in restructuring and other charges, compared with $136 million in the second quarter, including $53.7 million in charges. Revenues for the third quarter were up 8.9%, compared with 2002, to $2.30 billion, and they gained 15% over nine months to hit $6.88 billion, with
the six businesses all posting growth in sales.