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8-K - FORM 8-K - Celanese Corp | d72459e8vk.htm |
EX-99.3 - EX-99.3 - Celanese Corp | d72459exv99w3.htm |
EX-10.1 - EX-10.1 - Celanese Corp | d72459exv10w1.htm |
EX-99.4 - EX-99.4 - Celanese Corp | d72459exv99w4.htm |
EX-99.2 - EX-99.2 - Celanese Corp | d72459exv99w2.htm |
Exhibit 99.1
Celanese Corporation | ||
Investor Relations | ||
Corporate News Release
|
1601 West LBJ Freeway | |
Dallas, Texas 75234 |
Celanese Corporation Reports Strong First Quarter Results
Record Quarterly Performance in Advanced Engineered Materials;
Raises Outlook for Full Year
Record Quarterly Performance in Advanced Engineered Materials;
Raises Outlook for Full Year
First quarter highlights:
| Net sales were $1,388 million, up 21% from prior year period | ||
| Operating profit was ($14) million versus $27 million in prior year period | ||
| Net earnings were $18 million versus ($20) million in prior year period | ||
| Operating EBITDA was $246 million versus $136 million in prior year period | ||
| Diluted EPS from continuing operations was $0.09 versus ($0.17) in prior year period | ||
| Adjusted EPS was $0.67 versus $0.08 in prior year period |
Three Months Ended | ||||||||
March 31, | ||||||||
(in $ millions, except per share data) | 2010 | 2009 | ||||||
Net sales |
1,388 | 1,146 | ||||||
Operating profit (loss) |
(14 | ) | 27 | |||||
Net earnings (loss) attributable to Celanese Corporation |
18 | (20 | ) | |||||
Operating EBITDA 1 |
246 | 136 | ||||||
Diluted EPS continuing operations |
$ | 0.09 | ($0.17 | ) | ||||
Diluted EPS total |
$ | 0.10 | ($0.16 | ) | ||||
Adjusted EPS 2 |
$ | 0.67 | $ | 0.08 |
1 | Non-U.S. GAAP measure. See reconciliation in Table 1. | |
2 | Non-U.S. GAAP measure. See reconciliation in Table 6. |
Dallas, April 27, 2010: Celanese Corporation (NYSE: CE), a leading, global chemical company,
today reported first quarter 2010 net sales of $1,388 million, up 21 percent from the same period
last year. The increase was primarily driven by significantly higher volumes across most
businesses, particularly in Advanced Engineered Materials, as a result of the global economic
recovery. Operating profit was a loss of $14 million compared with a profit of $27 million in the
prior year period. This quarters results included $135 million of other charges and other
adjustments, primarily associated with the proposed closure of its acetate manufacturing facility
in Spondon, Derby, United Kingdom. Net earnings were a profit of $18 million compared with a loss
of $20 million in the same period last year, with earnings from equity investments and dividends
from cost investments $49 million higher than the prior year period.
Adjusted earnings per share for the first quarter of 2010 were $0.67 compared with $0.08 in the
same period last year. Results for the first quarter of 2009 included an inventory accounting
impact of approximately $32 million before taxes primarily related to the negative effects of
first-in, first out (FIFO) accounting. Adjusted earnings per share for the first quarter of 2010
are based on an effective tax rate of 20 percent and a diluted share count of 158.9 million.
Page 2 of 13
Operating EBITDA in the period was $246 million compared with $136 million in the prior year
period. Adjusted earnings per share and operating EBITDA both exclude the $135 million of other
charges and other adjustments. The company estimated that higher raw material costs in acetyl
derivatives, primarily related to ethylene, had a total net impact of between $15 million and $20
million in the first quarter of 2010.
We are pleased with Celaneses performance in the quarter as it clearly demonstrated the operating
leverage of our advantaged portfolio, said David Weidman, chairman and chief executive officer.
As the global economy rebounded off of its 2009 low point, our businesses continued to show signs
of an accelerating sequential recovery. Our Advanced Engineered Materials business saw
significant volume increase due to improving demand and continued success in our innovation and
application development efforts. Although our acetyl chain experienced some impact from higher
raw material costs during the period, we expect to offset this over the next two quarters.
Recent Highlights
| Announced the construction of a 50,000 ton polyacetal (POM) production facility in its National Methanol Co. joint venture (Ibn Sina) in Saudi Arabia and extended the venture, which will now run until 2032. Upon successful startup of the POM facility, Celaneses economic interest in Ibn Sina will increase from 25 percent to a total of 32.5 percent. | ||
| Announced it is considering a consolidation of its global acetate manufacturing capabilities with the potential closure of its acetate manufacturing facility in Spondon, Derby, United Kingdom. The company expects this proposed action would meet its return criteria for investment in productivity-related projects. | ||
| Received formal approval of its previously announced plans to expand flake and tow capacities, each by 30,000 tons, at its joint venture facility in Nantong, China, with its joint venture partner, China National Tobacco Corporation. | ||
| Announced a 25 percent increase in its quarterly common stock cash dividend beginning August 2010. The annual dividend rate will increase from $0.16 to $0.20 per share of common stock and the quarterly rate will increase from $0.04 to $0.05 per share. |
First Quarter Segment Overview
Advanced Engineered Materials
Advanced Engineered Materials delivered record performance in both earnings and volume as it
continued to demonstrate the significant operating leverage of its specialty engineered polymers
business model. Net sales for the first quarter were $282 million compared with $165 million in
the first quarter of 2009, driven by significantly higher volumes, positive currency effects and
sales from the Future Advanced Composites Technology long-fiber reinforced thermoplastics (LFT)
business acquired in December 2009. The higher volumes were attributed to the global economic
recovery across most of its end-use industries and geographies and continued success of its
application development and product innovation strategies.
Additionally, the quarters results benefited from additional volumes due to a polyacetal (POM)
competitor outage in Europe during the period. These increases were partially offset by lower
average pricing due to product mix and the sales mix effect of lower priced, non-specified
applications related to the competitor
Page 3 of 13
outage. Operating profit increased to $46 million compared with a loss of $19 million in the same
period last year. Operating EBITDA was $82 million in the first quarter of 2010 compared with $0
in the prior year period. Equity earnings from affiliates were $29 million higher than last years
results, reflecting similar volume increases as the companys Ticona business and the positive
sequential effects of the planned turnaround in the fourth quarter of 2009.
Consumer Specialties
Consumer Specialties continued to deliver sustained earnings despite ongoing softness in industry
demand. Net sales for the first quarter were $238 million compared with $266 million in the same
period last year, driven primarily by lower volumes in Europe and North America and the timing of
sales related to an electrical disruption and subsequent production outage at the companys acetate
manufacturing facility in Narrows, Virginia. The facility resumed normal operations during the
quarter and the company expects to recover the impacted volume throughout the remainder of the
year. Operating profit was a loss of $30 million compared with a profit of $66 million in the
prior year period. First quarter 2010 results included $80 million of other charges and other
adjustments, primarily associated with a non-cash impairment charge related to the companys
proposed closure of its acetate manufacturing facility in Spondon, Derby, United Kingdom. The
companys fixed spending reduction efforts were not able to offset the lower volumes and higher
energy costs. Operating EBITDA, excluding all other charges and other adjustments, was $61 million
compared with $81 million in the prior year period.
Industrial Specialties
Industrial Specialties continued to experience volume recovery in its emulsions and EVA performance
polymers businesses. Net sales for the first quarter were $242 million, flat year-over-year, as
increased volumes in emulsions and EVA performance polymers offset lower sales resulting from the
divestiture of the polyvinyl alcohol (PVOH) business in July 2009. First quarter 2009 results
included $36 million of sales associated with the divested PVOH business. Higher volumes were
primarily driven by the availability of production following the companys force majeure event at
its EVA performance polymers facility in Edmonton, Canada, in the first quarter of 2009. Results
also benefited from customer innovation efforts and continued growth in Asia for its emulsions
business. Operating profit was $12 million compared with $10 million in the same period last year,
as higher volumes were partially offset by higher raw material costs, particularly related to
ethylene. Last years results included $3 million in other charges and other adjustments related
to the companys restructuring efforts. Operating EBITDA in the first quarter of 2010 was $22
million compared with $26 million in the prior year period.
Acetyl Intermediates
Acetyl Intermediates delivered solid results, reflecting its advantaged technology position in
acetic acid and
throughout the acetyl chain. Net sales were $724 million compared with $572 million in the same
period last year, primarily driven by higher volumes and increased average pricing. Volumes
increased with a recovery in global economic conditions compared with the prior year and reflected
expected seasonality. Industry
Page 4 of 13
pricing levels in acetic acid have remained stable over the past several quarters, despite industry
utilization rates in the high 70 percent range. The company continued to operate its acetic acid
units at elevated rates.
Operating profit was $2 million compared with $12 million in the same period last year. First
quarter 2010 results included approximately $52 million of certain other adjustments, primarily
related to the write-down of certain raw material contracts due to a supplier bankruptcy, as well
as the write-down of other productive assets. Operating EBITDA, which excluded the adjustments,
was $107 million compared with $48 million in the first quarter of 2009. While pricing and margins
remained relatively stable in acetic acid, the company experienced margin pressure in its acetyl
derivatives product lines, primarily due to rapidly rising raw material costs and low industry
utilization. The company estimated a total first quarter net impact of between $15 million and $20
million throughout the acetyl chain. The majority of the estimated net impact was in Acetyl
Intermediates, with the remainder reflected in Industrial Specialties, and the company expects to
offset the impact over the next two quarters.
Taxes
The tax rate for adjusted earnings per share was 20 percent in the first quarter of 2010 compared
with 29 percent in the first quarter of 2009. The effective tax rate for continuing operations for
the first quarter of 2010 was 667 percent versus negative 31 percent in the first quarter of 2009.
The change in the effective rate is primarily due to new tax legislation in Mexico, partially
offset by foreign losses not resulting in tax benefits in the current period, the effect of
healthcare reform in the U.S. of $7 million, and lower earnings in jurisdictions participating in
tax holidays. Cash taxes paid were $11 million in the first quarter of 2010 compared with a net
cash tax refund of $5 million in the first quarter of 2009. The increase in cash taxes paid is
primarily the result of a German tax refund in 2009 and the timing of cash taxes in certain
jurisdictions.
Equity and Cost Investments
Earnings from equity investments and dividends from cost investments, which are reflected in the
companys adjusted earnings and operating EBITDA, were $53 million compared with $4 million in the
same period last year. The increase was primarily driven by increased earnings from the companys
Advanced Engineered Materials affiliates as well as higher dividends from the companys Ibn Sina
cost affiliate. Equity and cost investment dividends, which are included in cash flows, were $57
million compared with $24 million in the same period last year.
The strategic affiliates in the Advanced Engineered Materials business reported earnings in equity
investments of $21 million in the first quarter of 2010 as reflected in Table 8. Affiliate EBITDA
in excess of equity in net earnings of affiliates, not reflected in equity earnings, was $19
million in the same period. The companys proportional net debt of affiliates was approximately
$65 million as of March 31, 2010.
Page 5 of 13
Cash Flow
Cash and cash equivalents at the end of the first quarter of 2010 were $1,139 million compared with
$1,150 at the end of the first quarter of 2009. Cash provided by operating activities was $55
million in the quarter compared with $199 million in the same period last year as the increased
earnings were offset by higher trade working capital associated with increased volume. First
quarter 2009 results also included a $75 million
value-added tax reimbursement related to the relocation of Ticonas business in Kelsterbach,
Germany, which was paid in the second quarter of 2009. During the first quarter of 2009, the
company also received a payment of $412 million related to the Kelsterbach relocation, which is
reflected in investing activities. Net debt at the end of the first quarter of 2010 was $2,352
million, a $105 million increase from the end of the fourth quarter of 2009.
Outlook
Based on the impact of the accelerating pace of the global economic recovery, primarily in Advanced
Engineered Materials, and the continued success in implementing strategies to enhance the earnings
power of its leading businesses, the company increased its expectation for growth in 2010 to more
than $250 million of operating EBITDA compared with 2009. The company had previously expected
improved operating EBITDA of approximately $200 million, absent a significant economic catalyst.
The company noted that increased volumes in Advanced Engineered Materials and higher year-over-year
dividends from its acetate China ventures are expected to drive the increased earnings growth
expectations. Over the next two quarters, the company also expects to offset approximately $15
million to $20 million impact from higher raw material costs experienced throughout the acetyl
chain during the first quarter of 2010.
We saw improved global demand across most of our businesses and expect this trend to continue into
the second quarter, particularly in Advanced Engineered Materials, Weidman said. The plans that
we have in place to drive improved earnings are on track and continue to add to our near-term
performance. With our advantaged portfolio, leading technologies, continual productivity and
profitable innovation, we remain confident in our ability to deliver improved earnings in 2010 and
beyond.
Contacts: |
||||
Investor Relations
|
Media U.S. | Media Europe | ||
Mark Oberle
|
W. Travis Jacobsen | Jens Kurth | ||
Phone: +1 972 443 4464
|
Phone: +1 972 443 3750 | Phone: +49 (0)6107 772 1574 | ||
Telefax: +1 972 443 8519
|
Telefax: +1 972 443 8519 | Telefax: +49 (0)6107 772 7231 | ||
Mark.Oberle@celanese.com
|
William.Jacobsen@celanese.com | J.Kurth@celanese.com |
As a global leader in the chemicals industry, Celanese Corporation makes products essential to
everyday living. Our products, found in consumer and industrial applications, are manufactured in
North America, Europe and Asia. Net sales totaled $5.1 billion in 2009, with approximately 73%
generated outside of North
America. Known for operational excellence and execution of its business strategies, Celanese
delivers value to customers around the globe with innovations and best-in-class technologies.
Based in Dallas, Texas, the company employs approximately 7,400 employees worldwide. For more
information on Celanese Corporation, please visit the companys website at
www.celanese.com.
Page 6 of 13
Forward-Looking Statements
This release may contain forward-looking statements, which include information concerning the
companys plans, objectives, goals, strategies, future revenues or performance, capital
expenditures, financing needs and other information that is not historical information. When used
in this release, the words outlook, forecast, estimates, expects, anticipates,
projects, plans, intends, believes, and variations of such words or similar expressions are
intended to identify forward-looking statements. All forward-looking statements are based upon
current expectations and beliefs and various assumptions. There can be no assurance that the
company will realize these expectations or that these beliefs will prove correct. There are a
number of risks and uncertainties that could cause actual results to differ materially from the
forward-looking statements contained in this release. Numerous factors, many of which are beyond
the companys control, could cause actual results to differ materially from those expressed as
forward-looking statements. Certain of these risk factors are discussed in the companys filings
with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the
date on which it is made, and the company undertakes no obligation to update any forward-looking
statements to reflect events or circumstances after the date on which it is made or to reflect the
occurrence of anticipated or unanticipated events or circumstances.
Reconciliation of Non-U.S. GAAP Measures to U.S. GAAP
This release reflects five performance measures, operating EBITDA, affiliate EBITDA, adjusted
earnings per share, net debt and adjusted free cash flow, as non-U.S. GAAP measures. These
measurements are not recognized in accordance with U.S. GAAP and should not be viewed as an
alternative to U.S. GAAP measures of performance. The most directly comparable financial measure
presented in accordance with U.S. GAAP in our consolidated financial statements for operating
EBITDA is operating profit; for affiliate EBITDA is equity in net earnings of affiliates; for
adjusted earnings per share is earnings per common share-diluted; for net debt is total debt; and
for adjusted free cash flow is cash flow from operations.
Use of Non-U.S. GAAP Financial Information
| Operating EBITDA, a measure used by management to measure performance, is defined by the company as operating profit from continuing operations, plus equity in net earnings from affiliates, other income and depreciation and amortization, and further adjusted for other charges and adjustments. We may provide guidance on operating EBITDA and are unable to reconcile forecasted operating EBITDA to a U.S. GAAP financial measure because a forecast of Other Charges and Adjustments is not practical. Our management believes operating EBITDA is useful to investors because it is one of the primary measures our management uses for its planning and budgeting processes and to monitor and evaluate financial and operating results. | ||
| Affiliate EBITDA, a measure used by management to measure performance of its equity investments, is defined by the company as the proportional operating profit plus the proportional depreciation and amortization of its equity investments. The company has determined that it does not have sufficient ownership for operating control of these investments to consider their results on a consolidated basis. The company believes that investors should consider affiliate EBITDA when determining the equity investments overall value in the company. | ||
| Adjusted earnings per share is a measure used by management to measure performance. It is defined by the company as net earnings (loss) available to common shareholders plus preferred dividends, adjusted for other charges and adjustments, and divided by the number of basic common shares, diluted preferred shares, and options valued using the treasury method. We may provide guidance on an adjusted earnings per share basis and are unable to reconcile forecasted adjusted earnings per share to a U.S. GAAP financial measure without unreasonable effort because a forecast of Other Items is not practical. We believe that the presentation of this non-U.S. GAAP measure provides useful information to management and investors regarding various financial and business trends relating to our financial condition and results of operations, and that when U.S. GAAP information is viewed in conjunction with non-U.S. GAAP information, investors are provided with a more meaningful understanding of our ongoing operating performance. Note: The tax rate used for adjusted earnings per share approximates the midpoint in a range of forecasted tax rates for the year, excluding changes in uncertain tax positions, discrete items and other material items adjusted out of our U.S. GAAP earnings for adjusted earnings per share purposes, and changes in managements assessments regarding the ability to realize deferred tax assets. We analyze this rate quarterly and adjust if there is a material change in the range of forecasted tax rates; an updated forecast would not necessarily result in a change to our tax rate used for adjusted earnings per share. The adjusted tax rate is an estimate and may differ significantly from the tax rate used for U.S. GAAP reporting in any given reporting period. It is not practical to reconcile our prospective adjusted tax rate to the actual U.S. GAAP tax rate in any future period. | ||
| Net debt is defined by the company as total debt less cash and cash equivalents. We believe that the presentation of this non-U.S. GAAP measure provides useful information to management and investors regarding changes to the companys capital structure. Our management and credit analysts use net debt to evaluate the companys capital structure and assess credit quality. Proportional net debt is defined as our proportionate share of our affiliates net debt. | ||
| Adjusted free cash flow is defined by the company as cash flow from operations less capital expenditures, other productive asset purchases, operating cash from discontinued operations and certain other charges and adjustments. We believe that the presentation of this non-U.S. GAAP measure provides useful information to management and investors regarding changes to the companys cash flow. Our management and credit analysts use adjusted free cash flow to evaluate the companys liquidity and assess credit quality. |
Results Unaudited
The results presented in this release, together with the adjustments made to present the
results on a comparable basis, have not been audited and are based on internal financial data
furnished to management. Quarterly results should not be taken as an indication of the results of
operations to be reported for any subsequent period or for the full
fiscal year.
Page 7 of 13
Preliminary Consolidated Statements of Operations Unaudited
Three Months Ended | ||||||||
March 31, | ||||||||
(in $ millions, except per share data) | 2010 | 2009 | ||||||
Net sales |
1,388 | 1,146 | ||||||
Cost of sales |
(1,170 | ) | (946 | ) | ||||
Gross profit |
218 | 200 | ||||||
Selling, general and administrative expenses |
(123 | ) | (114 | ) | ||||
Amortization of Intangible assets 1 |
(15 | ) | (17 | ) | ||||
Research and development expenses |
(19 | ) | (20 | ) | ||||
Other (charges) gains, net |
(77 | ) | (21 | ) | ||||
Foreign exchange gain (loss), net |
2 | 2 | ||||||
Gain (loss) on disposition of businesses and assets, net |
| (3 | ) | |||||
Operating profit (loss) |
(14 | ) | 27 | |||||
Equity in net earnings (loss) of affiliates |
26 | (2 | ) | |||||
Interest expense |
(49 | ) | (51 | ) | ||||
Interest income |
1 | 3 | ||||||
Dividend income cost investments |
27 | 6 | ||||||
Other income (expense), net |
6 | 1 | ||||||
Earnings (loss) from continuing operations before tax |
(3 | ) | (16 | ) | ||||
Income tax (provision) benefit |
20 | (5 | ) | |||||
Earnings (loss) from continuing operations |
17 | (21 | ) | |||||
Earnings (loss) from operation of discontinued operations |
| 1 | ||||||
Gain on disposal of discontinued operations |
2 | | ||||||
Income tax (provision) benefit, discontinued operations |
(1 | ) | | |||||
Earnings (loss) from discontinued operations |
1 | 1 | ||||||
Net earnings (loss) |
18 | (20 | ) | |||||
Less: Net earnings (loss) attributable to noncontrolling interests |
| | ||||||
Net earnings (loss) attributable to Celanese Corporation |
18 | (20 | ) | |||||
Cumulative preferred stock dividend |
(3 | ) | (3 | ) | ||||
Net earnings (loss) available to common shareholders |
15 | (23 | ) | |||||
Amounts attributable to Celanese Corporation |
||||||||
Earnings (loss) per common share basic |
||||||||
Continuing operations |
$ | 0.09 | ($0.17 | ) | ||||
Discontinued operations |
0.01 | 0.01 | ||||||
Net earnings (loss) basic |
$ | 0.10 | ($0.16 | ) | ||||
Earnings (loss) per common share diluted |
||||||||
Continuing operations |
$ | 0.09 | ($0.17 | ) | ||||
Discontinued operations |
0.01 | 0.01 | ||||||
Net earnings (loss) diluted |
$ | 0.10 | ($0.16 | ) | ||||
Weighted average shares (millions) |
||||||||
Basic |
150.3 | 143.5 | ||||||
Diluted |
152.6 | 143.5 | ||||||
1 | Customer related intangibles |
Page 8 of 13
Preliminary Consolidated Balance Sheets Unaudited
March 31, | December 31, | |||||||
(in $ millions) | 2010 | 2009 | ||||||
ASSETS |
||||||||
Current assets |
||||||||
Cash & cash equivalents |
1,139 | 1,254 | ||||||
Trade receivables third party and affiliates, net |
801 | 721 | ||||||
Non-trade receivables |
276 | 262 | ||||||
Inventories |
545 | 522 | ||||||
Deferred income taxes |
41 | 42 | ||||||
Marketable securities, at fair value |
4 | 3 | ||||||
Assets held for sale |
3 | 2 | ||||||
Other assets |
42 | 50 | ||||||
Total current assets |
2,851 | 2,856 | ||||||
Investments in affiliates |
764 | 790 | ||||||
Property, plant and equipment, net |
2,723 | 2,797 | ||||||
Deferred income taxes |
488 | 484 | ||||||
Marketable securities, at fair value |
79 | 80 | ||||||
Other assets |
266 | 311 | ||||||
Goodwill |
765 | 798 | ||||||
Intangible assets, net |
266 | 294 | ||||||
Total assets |
8,202 | 8,410 | ||||||
LIABILITIES AND SHAREHOLDERS EQUITY |
||||||||
Current liabilities |
||||||||
Short-term borrowings and current
installments of long-term debt third party and affiliates |
258 | 242 | ||||||
Trade payables third party and affiliates |
626 | 649 | ||||||
Other liabilities |
552 | 611 | ||||||
Deferred income taxes |
32 | 33 | ||||||
Income taxes payable |
72 | 72 | ||||||
Total current liabilities |
1,540 | 1,607 | ||||||
Long-term debt |
3,233 | 3,259 | ||||||
Deferred income taxes |
129 | 137 | ||||||
Uncertain tax positions |
227 | 229 | ||||||
Benefit obligations |
1,275 | 1,288 | ||||||
Other liabilities |
1,224 | 1,306 | ||||||
Commitments and contingencies |
||||||||
Shareholders equity |
||||||||
Preferred stock |
| | ||||||
Common stock |
| | ||||||
Treasury stock, at cost |
(781 | ) | (781 | ) | ||||
Additional paid-in capital |
530 | 522 | ||||||
Retained earnings |
1,511 | 1,502 | ||||||
Accumulated other comprehensive income (loss), net |
(686 | ) | (659 | ) | ||||
Total Celanese Corporation shareholders equity |
574 | 584 | ||||||
Noncontrolling interests |
| | ||||||
Total shareholders equity |
574 | 584 | ||||||
Total liabilities and shareholders equity |
8,202 | 8,410 | ||||||
Page 9 of 13
Table 1
Segment Data and Reconciliation of Operating Profit (Loss) to Operating EBITDA
a Non-U.S. GAAP Measure
Three Months Ended | ||||||||
March 31, | ||||||||
(in $ millions) | 2010 | 2009 | ||||||
Net Sales |
||||||||
Advanced Engineered Materials |
282 | 165 | ||||||
Consumer Specialties |
238 | 266 | ||||||
Industrial Specialties |
242 | 242 | ||||||
Acetyl Intermediates |
724 | 572 | ||||||
Other Activities 1 |
| | ||||||
Intersegment eliminations |
(98 | ) | (99 | ) | ||||
Total |
1,388 | 1,146 | ||||||
Operating Profit (Loss) |
||||||||
Advanced Engineered Materials |
46 | (19 | ) | |||||
Consumer Specialties |
(30 | ) | 66 | |||||
Industrial Specialties |
12 | 10 | ||||||
Acetyl Intermediates |
2 | 12 | ||||||
Other Activities 1 |
(44 | ) | (42 | ) | ||||
Total |
(14 | ) | 27 | |||||
Equity Earnings, Cost Dividend Income and Other Income (Expense) |
||||||||
Advanced Engineered Materials |
21 | (8 | ) | |||||
Consumer Specialties |
| 3 | ||||||
Industrial Specialties |
| | ||||||
Acetyl Intermediates |
28 | 4 | ||||||
Other Activities 1 |
10 | 6 | ||||||
Total |
59 | 5 | ||||||
Other Charges and Other Adjustments 2 |
||||||||
Advanced Engineered Materials |
(2 | ) | 10 | |||||
Consumer Specialties |
80 | | ||||||
Industrial Specialties |
| 3 | ||||||
Acetyl Intermediates |
52 | 5 | ||||||
Other Activities 1 |
5 | 15 | ||||||
Total |
135 | 33 | ||||||
Depreciation and Amortization Expense |
||||||||
Advanced Engineered Materials |
17 | 17 | ||||||
Consumer Specialties |
11 | 12 | ||||||
Industrial Specialties |
10 | 13 | ||||||
Acetyl Intermediates |
25 | 27 | ||||||
Other Activities 1 |
3 | 2 | ||||||
Total |
66 | 71 | ||||||
Operating EBITDA |
||||||||
Advanced Engineered Materials |
82 | | ||||||
Consumer Specialties |
61 | 81 | ||||||
Industrial Specialties |
22 | 26 | ||||||
Acetyl Intermediates |
107 | 48 | ||||||
Other Activities 1 |
(26 | ) | (19 | ) | ||||
Total |
246 | 136 | ||||||
1 | Other Activities primarily includes corporate selling, general and administrative expenses and the results from captive insurance companies. | |
2 | See Table 7 for details. |
Page 10 of 13
Table 2
Factors
Affecting First Quarter 2010 Segment Net Sales Compared to First
Quarter 2009
Volume | Price | Currency | Other1 | Total | ||||||||||||||||
Advanced Engineered Materials |
71 | % | -11 | % | 6 | % | 5 | %2 | 71 | % | ||||||||||
Consumer Specialties |
-11 | % | 0 | % | 0 | % | 0 | % | -11 | % | ||||||||||
Industrial Specialties |
16 | % | -4 | % | 3 | % | -15 | %3 | 0 | % | ||||||||||
Acetyl Intermediates |
14 | % | 10 | % | 3 | % | 0 | % | 27 | % | ||||||||||
Total Company |
18 | % | 3 | % | 3 | % | -3 | % | 21 | % | ||||||||||
1 | Includes the effects of the captive insurance companies and the impact of fluctuations in intersegment eliminations. | |
2 | 2010 includes the effects of the FACT GmbH (Future Advanced Composites Technology) acquisition. | |
3 | 2010 does not include the effects of the PVOH business, which was sold on July 1, 2009. |
Table 3
Cash Flow Information
Three Months Ended | ||||||||
March 31, | ||||||||
(in $ millions) | 2010 | 2009 | ||||||
Net cash provided by operating activities |
55 | 199 | ||||||
Net cash provided by (used in) investing activities 1 |
(132 | ) | 311 | |||||
Net cash used in financing activities |
(15 | ) | (48 | ) | ||||
Exchange rate effects on cash |
(23 | ) | 12 | |||||
Cash and cash equivalents at beginning of period |
1,254 | 676 | ||||||
Cash and cash equivalents at end of period |
1,139 | 1,150 | ||||||
1 | 2010 includes $0 million of cash received and $85 million of capital expenditures related to the Ticona Kelsterbach plant relocation. 2009 includes $412 million of cash received and $58 million of capital expenditures related to the Ticona Kelsterbach plant relocation. |
Table 4
Cash Dividends Received
Three Months Ended | ||||||||
March 31, | ||||||||
(in $ millions) | 2010 | 2009 | ||||||
Dividends from equity investments |
30 | 18 | ||||||
Dividends from cost investments |
27 | 6 | ||||||
Total |
57 | 24 | ||||||
Page 11 of 13
Table 5
Net Debt Reconciliation of a Non-U.S. GAAP Measure
March 31, | December 31, | |||||||
(in $ millions) | 2010 | 2009 | ||||||
Short-term borrowings and current
installments of long-term debt third party and affiliates |
258 | 242 | ||||||
Long-term debt |
3,233 | 3,259 | ||||||
Total debt |
3,491 | 3,501 | ||||||
Less: Cash and cash equivalents |
1,139 | 1,254 | ||||||
Net Debt |
2,352 | 2,247 | ||||||
Table 6
Adjusted Earnings (Loss) Per Share Reconciliation of a Non-U.S. GAAP Measure
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
(in $ millions, except per share data) | 2010 | 2009 | |||||||||||||||
per | per | ||||||||||||||||
share | share | ||||||||||||||||
Earnings (loss) from continuing operations |
17 | 0.09 | (21 | ) | (0.17 | ) | |||||||||||
Deduct Income tax (provision) benefit |
20 | (5 | ) | ||||||||||||||
Earnings (loss) from continuing operations
before tax |
(3 | ) | (16 | ) | |||||||||||||
Other charges and other adjustments 1 |
135 | 33 | |||||||||||||||
Adjusted earnings (loss) from continuing
operations before tax |
132 | 17 | |||||||||||||||
Income tax (provision) benefit on adjusted earnings 2 |
(26 | ) | (5 | ) | |||||||||||||
Less: Noncontrolling interests |
| | |||||||||||||||
Adjusted earnings (loss) from continuing
operations |
106 | 0.67 | 12 | 0.08 | |||||||||||||
Diluted shares (in millions) 3 |
|||||||||||||||||
Weighted average shares outstanding |
150.3 | 143.5 | |||||||||||||||
Assumed conversion of preferred stock |
6.3 | 12.1 | |||||||||||||||
Dilutive restricted stock units |
0.4 | | |||||||||||||||
Dilutive stock options |
1.9 | | |||||||||||||||
Total diluted shares |
158.9 | 155.6 | |||||||||||||||
1 | See Table 7 for details. | |
2 | The adjusted effective tax rate is 20% and 29% for the three months ended March 31, 2010 and 2009, respectively. | |
3 | Potentially dilutive shares are included in the adjusted earnings per share calculation when adjusted earnings are positive. |
Page 12 of 13
Table 7
Reconciliation of Other Charges and Other Adjustments
Other Charges:
Three Months Ended | ||||||||
March 31, | ||||||||
(in $ millions) | 2010 | 2009 | ||||||
Employee termination benefits |
5 | 24 | ||||||
Ticona Kelsterbach plant relocation |
6 | 3 | ||||||
Clear Lake insurance recoveries |
| (6 | ) | |||||
Plumbing actions |
(12 | ) | (1 | ) | ||||
Asset impairments |
72 | 1 | ||||||
Other |
6 | | ||||||
Total |
77 | 21 | ||||||
Other Adjustments: 1
Three Months Ended | Income | |||||||||||
March 31, | Statement | |||||||||||
(in $ millions) | 2010 | 2009 | Classification | |||||||||
Business optimization |
4 | 2 | SG&A | |||||||||
Ticona Kelsterbach plant relocation |
| 1 | Cost of sales | |||||||||
Plant closures |
9 | 4 | Cost of sales / SG&A | |||||||||
Contract termination |
22 | | Cost of sales | |||||||||
Write-off of other productive assets |
17 | | Cost of sales | |||||||||
Other |
6 | 5 | Various | |||||||||
Total |
58 | 12 | ||||||||||
Total other charges and other adjustments |
135 | 33 | ||||||||||
1 | These items are included in net earnings but not included in other charges. |
Page 13 of 13
Table 8 Equity Affiliate Data
Equity Affiliate Preliminary Results Total Unaudited
Three Months Ended | ||||||||
(in $ millions) | March 31, | |||||||
2010 | 2009 | |||||||
Net Sales |
||||||||
Ticona Affiliates1 |
371 | 172 | ||||||
Infraserv Affiliates2 |
530 | 510 | ||||||
Total |
901 | 682 | ||||||
Operating Profit |
||||||||
Ticona Affiliates |
65 | (19 | ) | |||||
Infraserv Affiliates |
20 | 25 | ||||||
Total |
85 | 6 | ||||||
Depreciation and Amortization |
||||||||
Ticona Affiliates |
21 | 27 | ||||||
Infraserv Affiliates |
26 | 23 | ||||||
Total |
47 | 50 | ||||||
Affiliate EBITDA3 |
||||||||
Ticona Affiliates |
86 | 8 | ||||||
Infraserv Affiliates |
46 | 48 | ||||||
Total |
132 | 56 | ||||||
Net Income |
||||||||
Ticona Affiliates |
44 | (16 | ) | |||||
Infraserv Affiliates |
15 | 19 | ||||||
Total |
59 | 3 | ||||||
Net Debt |
||||||||
Ticona Affiliates |
144 | 260 | ||||||
Infraserv Affiliates |
447 | 562 | ||||||
Total |
591 | 822 | ||||||
Equity Affiliate Preliminary Results Celanese Proportional Share Unaudited4
Three Months Ended | ||||||||
(in $ millions) | March 31, | |||||||
2010 | 2009 | |||||||
Net Sales |
||||||||
Ticona Affiliates |
171 | 80 | ||||||
Infraserv Affiliates |
174 | 163 | ||||||
Total |
345 | 243 | ||||||
Operating Profit |
||||||||
Ticona Affiliates |
30 | (8 | ) | |||||
Infraserv Affiliates |
7 | 8 | ||||||
Total |
37 | | ||||||
Depreciation and Amortization |
||||||||
Ticona Affiliates |
10 | 12 | ||||||
Infraserv Affiliates |
8 | 7 | ||||||
Total |
18 | 19 | ||||||
Affiliate EBITDA3 |
||||||||
Ticona Affiliates |
40 | 4 | ||||||
Infraserv Affiliates |
15 | 15 | ||||||
Total |
55 | 19 | ||||||
Equity in net earnings of affiliates (as reported on the Income Statement) |
||||||||
Ticona Affiliates |
21 | (8 | ) | |||||
Infraserv Affiliates |
5 | 6 | ||||||
Total |
26 | (2 | ) | |||||
Affiliate EBITDA in excess of Equity in net earnings of affiliates5 |
||||||||
Ticona Affiliates |
19 | 12 | ||||||
Infraserv Affiliates |
10 | 9 | ||||||
Total |
29 | 21 | ||||||
Net Debt |
||||||||
Ticona Affiliates |
65 | 118 | ||||||
Infraserv Affiliates |
147 | 177 | ||||||
Total |
212 | 295 | ||||||
1 | Ticona Affiliates accounted for using the equity method include Polyplastics (45% ownership), Korean Engineering Plastics (50%), Fortron Industries (50%) and Una SA (50%). | |
2 | Infraserv Affiliates accounted for using the equity method include Infraserv Hoechst (32% ownership), Infraserv Gendorf (39%) and Infraserv Knapsack (27%). | |
3 | Affiliate EBITDA, a non-U.S. GAAP measure, is the sum of Operating Profit and Depreciation and Amortization. | |
4 | Calculated by multiplying each affiliates total share amount by Celaneses respective ownership percentage, netted by reporting category. | |
5 | Calculated as Celanese proportion of Affiliate EBITDA less Equity in net earnings of affiliates; not included in Celanese operating EBITDA. |