HUNHIGH SIGNALFINANCIAL10-K

HUN's operating income deteriorated dramatically from -$25M to -$131M, representing a 424% decline in operating performance despite improved cash position.

The massive deterioration in operating performance, with operating losses quintupling while gross profit declined 13%, signals significant operational challenges or one-time charges that have severely impacted profitability. However, the 26% increase in cash suggests the company may have taken proactive steps to preserve liquidity amid these operational headwinds.

Comparing 2026-02-18 vs 2025-02-18View on EDGAR →
FINANCIAL ANALYSIS

HUN experienced severe financial deterioration with operating income plunging 424% to -$131M and net losses widening 50% to -$284M, while gross profit declined 13% to $751M indicating both margin compression and operational inefficiencies. The company's cash position strengthened 26% to $429M and inventory decreased 11% to $818M, suggesting management may be conserving cash and managing working capital amid the operational challenges. The combination of massive operating losses with improved liquidity presents a mixed picture where near-term performance is deeply concerning but the company appears to be taking defensive financial measures.

FINANCIAL STATEMENT CHANGES
Operating Income
P&L
-424%
-$25.0M→-$131.0M

Operating income deteriorated sharply — investigate whether driven by one-time charges or structural cost issues.

Net Income
P&L
-50.3%
-$189.0M→-$284.0M

Net income declined 50.3% — review whether driven by operations, interest costs, or non-recurring items.

Cash & Equivalents
Balance Sheet
+26.2%
$340.0M→$429.0M

Cash grew 26.2% — improving liquidity position supports investment and shareholder returns.

Gross Profit
P&L
-13.3%
$866.0M→$751.0M

Gross margin compression — rising input costs, pricing pressure, or unfavorable product mix shift.

Inventory
Balance Sheet
-10.8%
$917.0M→$818.0M

Inventory reduced 10.8% — lean inventory management or demand outpacing supply.

LANGUAGE CHANGES
NEW — 2026-02-18
PRIOR — 2025-02-18
ADDED
Segment adjusted EBITDA is the measure that our chief operating decision maker ( CODM ), who has been determined to be our Chief Executive Officer, uses to make decisions about resources to be allocated to the segments and assess their financial performance.
Our CODM evaluates segment adjusted EBITDA through the annual budget process as well as through ongoing periodic reviews of forecasts, budget-to-actual variances, changes from prior periods and when comparing the results of each reportable operating segment with one another.
Total operating lease expense includes short-term lease expense of approximately $1 million, $1 million and $3 million for the years ended December 31, 2023, 2022 and 2021, respectively.
Amounts contain approximately nil, nil and $1 million of prior service credit and actuarial loss related to discontinued operations for the years ended December 31, 2025, 2024 and 2023, respectively.
Other segment items include other operating and non-operating income and expense items and foreign currency exchange effects, less adjustments to remove the related effects of primarily the following items: business acquisition and integration gain (expenses) and purchase accounting inventory adjustments, net; certain legal and other settlements and related income (expenses), net; amortization of pension and postretirement actuarial losses; loss on sale of business/assets; and restructuring, impairment and plant closing and transition costs.
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REMOVED
Other segment items include other operating and non-operating income and expense items and foreign currency exchange effects.
A total of 191,959 performance share unit awards with a grant date fair value of $45.04 that were included in the December 31, 2023 nonvested balance did not meet the minimum performance criteria of these awards and were effectively forfeited during the first quarter of 2024.
Amounts are net of tax of $91 million and $55 million as of December 31, 2023 and January 1, 2023, respectively.
Certain legal and other settlements and related expenses for the year ended December 31, 2024 includes approximately $10 million related to the settlement of a claim in connection with a commercial dispute.
The representative interest rate as of December 31, 2024 was 1.475% above Term SOFR.
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