Huntsman Q1 Earnings Call Highlights

Key Points

• Huntsman said management has been successfully using price increases to offset rising raw material and logistics costs while maintaining reliable plant operations, and expects margin expansion and a more favorable price/mix in Q2.
• The company reported stronger-than-expected demand into Q2—driven by seasonality, customer pre-buying and trade disruptions—but warned visibility beyond Q2 is limited and higher energy/inflation could pressure demand later in the year.
• In Polyurethanes, Huntsman is aggressively raising prices with utilization in the high‑80s (sold out in China and largely in the U.S.), targeting mid‑teen EBITDA margins, while Europe still faces energy-cost pressure even as management expects the region to be EBITDA-positive.

Huntsman NYSE: HUN executives said first-quarter operating performance carried into the second quarter as the company pushed through price increases to offset higher raw material and logistics costs tied to the conflict in the Middle East, while also noting that longer-term demand visibility remains limited.

On the company’s first-quarter 2026 earnings call, Chairman, CEO and President Peter Huntsman said management’s “number one commercial priority has been to increase prices enough to offset rising costs,” adding, “I believe we’ve been successful in doing this.” He said a second priority has been reliable plant operations to ensure product availability, noting that “our operations during the first quarter and going into the second quarter have been excellent.”

Demand stronger than expected into the second quarter, but sustainability uncertain

From a sales standpoint, Huntsman said it is seeing “stronger than expected demand going well into the second quarter,” which Peter Huntsman attributed to three factors:

• Seasonality as the construction season resumes across North America, Europe, and Asia;
• Customer purchases ahead of expected price increases;
• Disruptions in trade flows affecting supply, including European customers’ dependence on Chinese-supplied maleic.

Peter Huntsman also pointed to “very low” inventory levels across supply chains as an additional backdrop supporting improved order patterns. However, he cautioned the outlook becomes less clear further into the quarter and later in the year. “I struggle to see how inflationary pressures, particularly in areas reliant on imported energy, like much of Asia and Europe, will not see an inevitable downward pressure later in the year,” he said, adding that the degree of any slowdown remains uncertain.

He highlighted mixed U.S. indicators, saying he was “heartened” by better-than-expected March housing starts and durable goods orders, while noting residential permits were down 11% in March.

Polyurethanes: pricing actions, high operating rates, and mid-cycle margin targets

On MDI and polyurethanes, Peter Huntsman said the company is “aggressively raising our prices” to both cover raw material costs and expand margins from “trough economics” experienced over the past three years. He emphasized the company’s intent not to be “a shock absorber between raw material costs and finished product pricing.”

Discussing MDI utilization, he said industry operating rates were “probably looking at the low to mid-80s,” while Huntsman’s own position was stronger. “We would be in the high 80s,” he said, adding that the company is “sold out completely” in its China operation and that its U.S. operation “for the most part is sold out.” In Europe, he said Huntsman is seeing “some green shoots.”

Peter Huntsman also described industry conditions when global utilization approaches 90%, saying that at “90%+ capacity,” the industry “starts to strain” given maintenance and outages. In response to concerns about feedstock supply, he said he had “not seen nor heard of any problems with the procurement of raw materials in MDI around the world.” His “biggest question” remained the sustainability of demand into the third and fourth quarters.

On pricing versus benzene, Peter Huntsman said Huntsman is “certainly staying ahead of the benzene curve,” though “never as far ahead as I would like to see it.” He said the company expects margin expansion driven by both volume and improved spreads beyond raw materials. He also indicated Huntsman expects a more favorable price/mix trend in the second quarter: “Certainly in Q2, hopefully beyond.”

Addressing longer-term profitability, Peter Huntsman said he has “always thought” Polyurethanes “ought to be a mid-teen sort of a business” on an EBITDA margin basis.

Huntsman also addressed customer ordering behavior, characterizing pre-buying as limited. In MDI, he estimated “two, three days” of pre-buying activity and said the company is discouraging outsized order increases to maintain equilibrium. “I’m not seeing panic buying at this point,” he said, while acknowledging higher capacity utilization.

Europe: energy-cost pressures and improving outlook

In response to questions about structural impacts, Peter Huntsman said he did not see “a great deal of structural change” in MDI overall, but he did see continuing pressure in Europe due to energy costs. He contrasted European natural gas prices “in the mid-teens” with U.S. Gulf Coast prices, noting the Houston Ship Channel price was “under $2 per MMBtu” that morning.

He said the company is at a “precipice” in Europe and wants not only positive EBITDA but “positive cash” out of the region. CFO Phil Lister added, “As we sit here today, we would expect Europe to be positive from an EBITDA perspective.”

Peter Huntsman identified areas showing improvement in Europe, including composite wood products, technical insulation (including panels used in data centers, warehouses, and prefabricated buildings), and the company’s adhesives, coatings, and elastomers business.

On the U.K. aniline facility, Peter Huntsman reiterated concern about economics, despite noting imports had eased and gas prices had fallen from $20-$22 to around $15. He praised plant personnel and reliability while criticizing what he described as “really poor energy policies.”

Performance Products and joint venture updates

In Performance Products, Peter Huntsman said strength in maleic should become more visible through the second quarter and into the third. He noted some European customers are purchasing maleic on an FOB Florida basis from the company’s Pensacola facility rather than having Huntsman ship product to Europe, which he said would reduce transit time and working capital tied up in shipments.

He also cited a headwind tied to an ethyleneamines joint venture facility in Saudi Arabia located “on the wrong side of the Strait of Hormuz.” Peter Huntsman said the facility had been down for two weeks, is operating at “around 50%,” and material is being trucked out, which is more expensive than shipping. He estimated the potential impact “could be as high as $4 million-$5 million for the quarter,” depending on the ability to move product economically.

On the company’s PO/MTBE joint venture in China, Peter Huntsman said it had previously been “a little bit of a drag,” but is now contributing “in the low to mid-single-digit millions of dollars.” Lister noted that in China, MTBE margins are not what investors might expect because gasoline pricing is managed differently, and said the joint venture’s current profitability is coming from propylene oxide margins “over and above propylene.”

Peter Huntsman also provided an update on specialty amines capacity being added to serve semiconductors, saying it is going through customer qualifications that typically take “around nine to 12 months.” He said that as Huntsman builds toward a normalized run rate, the company hopes to see “$5+ million” from that initiative in 2026.

Finally, asked how quickly exports could normalize if the Strait of Hormuz disruption eased, Peter Huntsman estimated “30-45 days,” citing shipping bottlenecks both to pick up product and move it out by sea.

About Huntsman NYSE: HUN

Huntsman Corporation is a global manufacturer and marketer of specialty chemicals with headquarters in The Woodlands, Texas. Founded in 1970 by entrepreneur Jon Huntsman Sr., the company has grown through strategic acquisitions and organic expansion to establish a broad portfolio of products serving diverse end markets. Huntsman maintains a presence in more than 30 countries, operating manufacturing facilities across North America, Europe, Asia-Pacific, Latin America and the Middle East.

The company organizes its operations into several core business segments, including Polyurethanes, Performance Products, Advanced Materials, and Textile Effects.

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