DELAWARE | 001-32410 | 98-0420726 | ||
(State or other jurisdiction
of incorporation) |
(Commission File
Number) |
(IRS Employer
Identification No.) |
Exhibit Number
Description
Press Release February 1, 2011*
Slide Show Presentation February 1, 2011*
*
In connection with the disclosure set forth in Item 2.02 and Item 7.01, the information in
this Current Report, including the exhibits attached hereto, is being furnished and shall not
be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as
amended (the
Exchange Act
), or otherwise subject to the liabilities of such section.
The information in this Current Report, including the exhibits, shall not be incorporated by
reference into any filing under the Securities Act of 1933, as amended or the Exchange Act,
regardless of any incorporation by reference language in any such filing. This Current Report
will not be deemed an admission as to the materiality of any information in this Current
Report that is required to be disclosed solely by Regulation FD.
CELANESE CORPORATION
By
/s/ James R. Peacock III
Name:
James R. Peacock III
Title:
Vice President, Deputy General Counsel and
Assistant Corporate Secretary
Exhibit Number
Description
Press Release February 1, 2011
Slide Show Presentation February 1, 2011
|
Celanese Corporation | |
|
Investor Relations | |
Corporate News Release
|
1601 West LBJ Freeway | |
|
Dallas, Texas 75234 |
| Net sales were $1,507 million, up 9% from prior year period | ||
| Operating profit was $138 million versus $109 million in prior year period | ||
| Net earnings were $56 million versus $6 million in prior year period | ||
| Operating EBITDA was $262 million, up 15% from prior year period | ||
| Diluted EPS from continuing operations was $0.64 versus $0.00 in prior year period | ||
| Adjusted EPS was $0.73, up 43% from prior year period |
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in $ millions, except per share data) Unaudited | 2010 | 2009 | 2010 | 2009 | ||||||||||||
As adjusted 3 | As adjusted 3 | |||||||||||||||
|
||||||||||||||||
Net sales
|
1,507 | 1,388 | 5,918 | 5,082 | ||||||||||||
Operating profit (loss)
|
138 | 109 | 501 | 290 | ||||||||||||
Net earnings (loss) attributable to Celanese Corporation
|
56 | 6 | 375 | 498 | ||||||||||||
Operating EBITDA
1
|
262 | 228 | 1,122 | 857 | ||||||||||||
Diluted EPS continuing operations
|
$ | 0.64 | $ | 0.00 | $ | 2.68 | $ | 3.14 | ||||||||
Diluted EPS total
|
$ | 0.35 | $ | 0.03 | $ | 2.37 | $ | 3.17 | ||||||||
Adjusted EPS
2
|
$ | 0.73 | $ | 0.51 | $ | 3.37 | $ | 1.75 | ||||||||
1 | Non-U.S. GAAP measure. See reconciliation in Table 1. | |
2 | Non-U.S. GAAP measure. See reconciliation in Table 6. | |
3 | The companys Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes. |
Page 2 of 16
| Announced its newly developed advanced technology to produce ethanol. This innovative, new process combines the companys proprietary and industry-leading acetyl platform with highly advanced manufacturing technology to produce ethanol from hydrocarbon-sourced feedstocks. | ||
| Signed letters of intent for projects to construct and operate industrial ethanol production facilities in Nanjing, China, at the Nanjing Chemical Industrial Park and in Zhuhai, China, at the Gaolan Port Economic Zone. | ||
| Signed a memorandum of understanding (MOU) with Wison (China) Holding Co., Ltd., a Chinese synthesis gas supplier, for production of certain feedstocks used in the companys advanced ethanol production process. | ||
| Launched VitalDose, an ethylene vinyl acetate (EVA) polymer-based excipient that facilitates drug makers efforts to develop and commercialize controlled-release pharmaceutical solutions. |
Page 3 of 16
Page 4 of 16
Page 5 of 16
Investor Relations
|
Media U.S. | Media Europe | ||
Andy Green
|
Jacqueline Terry | Jens Kurth | ||
Phone: +1 972 443 4965
|
Phone: +1 972 443 4417 | Phone: +49 (0)6107 772 1574 | ||
Telefax: +1 972 443 8519
|
Telefax: +1 972 443 8519 | Telefax: +49 (0)6107 772 7231 | ||
Andy.Green@celanese.com
|
Jacqueline.Terry@celanese.com | J.Kurth@celanese.com |
Page 6 of 16
Page 7 of 16
| Operating EBITDA is defined by the company as net earnings plus loss (earnings) from discontinued operations, interest expense, taxes, and depreciation and amortization, and further adjusted for Other Charges and Adjustments as described in Table 7. We present operating EBITDA because we consider it an important supplemental measure of our operations and financial performance. We believe that operating EBITDA is more reflective of our operations as it provides transparency to investors and enhances period-to-period comparability of our operations and financial performance. Operating EBITDA is one of the measures management uses for its planning and budgeting process to monitor and evaluate financial and operating results and for the companys incentive compensation plan. Operating EBITDA should not be considered as an alternative to net income determined in accordance with U.S. GAAP. 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. | ||
| Business operating EBITDA is defined by the company as net earnings plus loss (earnings) from discontinued operations, interest expense, taxes and depreciation and amortization, and further adjusted for Other Charges and Adjustments as described in Table 7, less equity in net earnings of affiliates, dividend income from cost investments and other (income) expense. This supplemental performance measure reflects the operating results of the companys operations without regard to the financial impact of its equity and cost investments. | ||
| Proportional affiliate EBITDA is defined by the company as the proportional operating profit plus the proportional depreciation and amortization of its equity investments. Affiliate EBITDA is defined by the company as operating profit plus the depreciation and amortization of its equity affiliates. 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 proportional affiliate EBITDA as an additional measure of operating results. | ||
| 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 as described in Table 7, 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. |
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in $ millions, except per share data) | 2010 | 2009 | 2010 | 2009 | ||||||||||||
As Adjusted 1 | As Adjusted 1 | |||||||||||||||
Net sales
|
1,507 | 1,388 | 5,918 | 5,082 | ||||||||||||
Cost of sales
|
(1,194 | ) | (1,099 | ) | (4,738 | ) | (4,079 | ) | ||||||||
Gross profit
|
313 | 289 | 1,180 | 1,003 | ||||||||||||
|
||||||||||||||||
Selling, general and administrative expenses
|
(132 | ) | (133 | ) | (505 | ) | (474 | ) | ||||||||
Amortization of Intangible assets
|
(16 | ) | (19 | ) | (61 | ) | (77 | ) | ||||||||
Research and development expenses
|
(18 | ) | (17 | ) | (70 | ) | (70 | ) | ||||||||
Other (charges) gains, net
|
(1 | ) | (13 | ) | (48 | ) | (136 | ) | ||||||||
Foreign exchange gain (loss), net
|
(4 | ) | 1 | (3 | ) | 2 | ||||||||||
Gain (loss) on disposition of businesses and assets, net
|
(4 | ) | 1 | 8 | 42 | |||||||||||
Operating profit (loss)
|
138 | 109 | 501 | 290 | ||||||||||||
|
||||||||||||||||
Equity in net earnings (loss) of affiliates
|
37 | 22 | 168 | 99 | ||||||||||||
Interest expense
|
(58 | ) | (51 | ) | (204 | ) | (207 | ) | ||||||||
Refinancing expense
|
| | (16 | ) | | |||||||||||
Interest income
|
5 | 1 | 7 | 8 | ||||||||||||
Dividend income cost investments
|
| | 73 | 57 | ||||||||||||
Other income (expense), net
|
6 | 6 | 7 | 4 | ||||||||||||
Earnings (loss) from continuing operations before tax
|
128 | 87 | 536 | 251 | ||||||||||||
|
||||||||||||||||
Income tax (provision) benefit
|
(27 | ) | (85 | ) | (112 | ) | 243 | |||||||||
Earnings (loss) from continuing operations
|
101 | 2 | 424 | 494 | ||||||||||||
|
||||||||||||||||
Earnings (loss) from operation of discontinued operations
|
(72 | ) | 6 | (80 | ) | 6 | ||||||||||
Gain on disposal of discontinued operations
|
| | 2 | | ||||||||||||
Income tax (provision) benefit, discontinued operations
|
27 | (2 | ) | 29 | (2 | ) | ||||||||||
Earnings (loss) from discontinued operations
|
(45 | ) | 4 | (49 | ) | 4 | ||||||||||
|
||||||||||||||||
Net earnings (loss)
|
56 | 6 | 375 | 498 | ||||||||||||
Less: Net earnings (loss) attributable to noncontrolling interests
|
| | | | ||||||||||||
Net earnings (loss) attributable to Celanese Corporation
|
56 | 6 | 375 | 498 | ||||||||||||
|
||||||||||||||||
Cumulative preferred stock dividend
|
| (2 | ) | (3 | ) | (10 | ) | |||||||||
Net earnings (loss) available to common shareholders
|
56 | 4 | 372 | 488 | ||||||||||||
|
||||||||||||||||
Amounts attributable to Celanese Corporation
|
||||||||||||||||
Earnings (loss) per common share basic
|
||||||||||||||||
Continuing operations
|
$ | 0.65 | $ | 0.00 | $ | 2.72 | $ | 3.37 | ||||||||
Discontinued operations
|
(0.29 | ) | 0.03 | (0.31 | ) | 0.03 | ||||||||||
Net earnings (loss) basic
|
$ | 0.36 | $ | 0.03 | $ | 2.41 | $ | 3.40 | ||||||||
|
||||||||||||||||
Earnings (loss) per common share diluted
|
||||||||||||||||
Continuing operations
|
$ | 0.64 | $ | 0.00 | $ | 2.68 | $ | 3.14 | ||||||||
Discontinued operations
|
(0.29 | ) | 0.03 | (0.31 | ) | 0.03 | ||||||||||
Net earnings (loss) diluted
|
$ | 0.35 | $ | 0.03 | $ | 2.37 | $ | 3.17 | ||||||||
|
||||||||||||||||
Weighted average shares (millions)
|
||||||||||||||||
Basic
|
155.7 | 144.1 | 154.6 | 143.7 | ||||||||||||
Diluted
|
158.3 | 144.1 | 158.4 | 157.1 | ||||||||||||
1 | The companys Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes. |
Page 9 of 16
1
The companys Ibn Sina investment is now included in the Advanced Engineered Materials segment using
the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the
cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes.
Page 10 of 16
Segment Data and Reconciliation of Operating Profit (Loss) to Operating EBITDA
a Non-U.S. GAAP Measure Unaudited
Three Months Ended
Twelve Months Ended
December 31,
December 31,
(in $ millions)
2010
2009
2010
2009
As Adjusted
4
As Adjusted
4
274
239
1,109
808
281
267
1,098
1,084
249
229
1,036
974
799
743
3,082
2,603
1
1
2
2
(97
)
(91
)
(409
)
(389
)
1,507
1,388
5,918
5,082
33
34
184
38
59
47
164
231
11
16
89
89
94
72
243
92
(59
)
(60
)
(179
)
(160
)
138
109
501
290
(14
)
(3
)
(36
)
13
4
97
10
6
(8
)
(19
)
(26
)
6
7
62
103
5
17
11
30
16
17
115
117
19
19
72
72
9
13
37
50
10
11
41
46
25
29
97
111
2
2
11
11
65
74
258
290
38
50
220
110
81
64
298
291
27
19
111
109
125
108
402
306
(52
)
(41
)
(157
)
(119
)
219
200
874
697
30
18
143
76
(1
)
1
73
57
2
3
9
9
12
6
23
18
43
28
248
160
68
68
363
186
80
65
371
348
27
19
111
109
127
111
411
315
(40
)
(35
)
(134
)
(101
)
262
228
1,122
857
1 | Other Activities primarily includes corporate selling, general and administrative expenses and the results from captive insurance companies. | |
2 | See Table 7 for details. | |
3 | Excludes accelerated depreciation and amortization associated with plant closures included in Other Charges and Other Adjustments above. See Table 1A for details. | |
4 | The companys Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes. |
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in $ millions) | 2010 | 2009 | 2010 | 2009 | ||||||||||||
As adjusted 3 | As adjusted 3 | |||||||||||||||
Net earnings (loss) attributable to Celanese Corporation
|
56 | 6 | 375 | 498 | ||||||||||||
(Earnings) loss from discontinued operations
|
45 | (4 | ) | 49 | (4 | ) | ||||||||||
Interest income
|
(5 | ) | (1 | ) | (7 | ) | (8 | ) | ||||||||
Interest expense
|
58 | 51 | 204 | 207 | ||||||||||||
Refinancing expense
|
| | 16 | | ||||||||||||
Income tax provision (benefit)
|
27 | 85 | 112 | (243 | ) | |||||||||||
Depreciation and amortization expense
2
|
65 | 74 | 258 | 290 | ||||||||||||
Other charges (gains), net
1
|
1 | 13 | 48 | 136 | ||||||||||||
Other adjustments
1
|
15 | 4 | 67 | (19 | ) | |||||||||||
Operating EBITDA
|
262 | 228 | 1,122 | 857 | ||||||||||||
|
||||||||||||||||
Detail by Segment
|
||||||||||||||||
Advanced Engineered Materials
|
68 | 68 | 363 | 186 | ||||||||||||
Consumer Specialties
|
80 | 65 | 371 | 348 | ||||||||||||
Industrial Specialties
|
27 | 19 | 111 | 109 | ||||||||||||
Acetyl Intermediates
|
127 | 111 | 411 | 315 | ||||||||||||
Other Activities
4
|
(40 | ) | (35 | ) | (134 | ) | (101 | ) | ||||||||
Operating EBITDA
|
262 | 228 | 1,122 | 857 | ||||||||||||
1 | See Table 7 for details. | |
2 | Excludes accelerated depreciation and amortization associated with plant closures as detailed in the table below and included in Other adjustments above. | |
3 | The companys Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes. |
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in $ millions) | 2010 | 2009 | 2010 | 2009 | ||||||||||||
Advanced Engineered Materials
|
| 1 | 4 | 1 | ||||||||||||
Consumer Specialties
|
4 | | 5 | | ||||||||||||
Industrial Specialties
|
| (1 | ) | | 5 | |||||||||||
Acetyl Intermediates
|
| 1 | 20 | 12 | ||||||||||||
Other Activities
4
|
(1 | ) | | | | |||||||||||
Accelerated depreciation and amortization
|
3 | 1 | 29 | 18 | ||||||||||||
|
||||||||||||||||
Depreciation and amortization expense
2
|
65 | 74 | 258 | 290 | ||||||||||||
Total depreciation and amortization
|
68 | 75 | 287 | 308 | ||||||||||||
4 | Other Activities primarily includes corporate selling, general and administrative expenses and the results from captive insurance companies. |
Volume | Price | Currency | Other | Total | ||||||||||||||||
Advanced Engineered Materials
|
10 | % | 5 | % | -5 | % | 5 | % 2 | 15 | % | ||||||||||
Consumer Specialties
|
5 | % | 1 | % | -1 | % | 0 | % | 5 | % | ||||||||||
Industrial Specialties
|
4 | % | 9 | % | -4 | % | 0 | % | 9 | % | ||||||||||
Acetyl Intermediates
|
3 | % | 8 | % | -3 | % | 0 | % | 8 | % | ||||||||||
Total Company
|
5 | % | 7 | % | -3 | % | 0 | % 1 | 9 | % | ||||||||||
Volume | Price | Currency | Other | Total | ||||||||||||||||
Advanced Engineered Materials
|
35 | % | 1 | % | -3 | % | 4 | % 2 | 37 | % | ||||||||||
Consumer Specialties
|
2 | % | 0 | % | -1 | % | 0 | % | 1 | % | ||||||||||
Industrial Specialties
|
11 | % | 6 | % | -3 | % | -8 | % 3 | 6 | % | ||||||||||
Acetyl Intermediates
|
10 | % | 10 | % | -2 | % | 0 | % | 18 | % | ||||||||||
Total Company
|
13 | % | 7 | % | -2 | % | -2 | % 1 | 16 | % | ||||||||||
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) and DuPont acquisitions. | |
3 | 2010 does not include the effects of the PVOH business, which was sold on July 1, 2009. |
Twelve Months Ended | ||||||||
December 31, | ||||||||
(in $ millions) | 2010 | 2009 | ||||||
Net cash provided by operating activities
|
452 | 596 | ||||||
Net cash provided by (used in) investing activities
1
|
(560 | ) | 31 | |||||
Net cash used in financing activities
|
(388 | ) | (112 | ) | ||||
Exchange rate effects on cash
|
(18 | ) | 63 | |||||
Cash and cash equivalents at beginning of period
|
1,254 | 676 | ||||||
Cash and cash equivalents at end of period
|
740 | 1,254 | ||||||
1 | 2010 includes $0 million of cash received and $312 million of capital expenditures related to the Ticona Kelsterbach plant relocation. 2009 includes $412 million of cash received and $351 million of capital expenditures related to the Ticona Kelsterbach plant relocation. |
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(in $ millions) | 2010 | 2009 | 2010 | 2009 | ||||||||||||
As Adjusted 1 | As Adjusted 1 | |||||||||||||||
Dividends from equity investments
|
18 | 23 | 138 | 78 | ||||||||||||
Dividends from cost investments
|
| | 73 | 57 | ||||||||||||
Total
|
18 | 23 | 211 | 135 | ||||||||||||
1 | The companys Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes. |
December 31, | December 31, | |||||||
(in $ millions) | 2010 | 2009 | ||||||
Short-term
borrowings and current installments of long-term debt third party and affiliates
|
228 | 242 | ||||||
Long-term debt
|
2,990 | 3,259 | ||||||
Total debt
|
3,218 | 3,501 | ||||||
Less: Cash and cash equivalents
|
740 | 1,254 | ||||||
Net Debt
|
2,478 | 2,247 | ||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||||||||||||||
(in $ millions, except per share data) | 2010 | 2009 | 2010 | 2009 | ||||||||||||||||||||||||||||
As Adjusted 5 | As Adjusted 5 | |||||||||||||||||||||||||||||||
per | per | per | per | |||||||||||||||||||||||||||||
share | share | share | share | |||||||||||||||||||||||||||||
Earnings (loss) from continuing operations
|
101 | 0.64 | 2 | 0.00 | 424 | 2.68 | 494 | 3.14 | ||||||||||||||||||||||||
Deduct Income tax (provision) benefit
|
(27 | ) | (85 | ) | (112 | ) | 243 | |||||||||||||||||||||||||
Earnings (loss) from continuing operations
before tax
|
128 | 87 | 536 | 251 | ||||||||||||||||||||||||||||
Other charges and other adjustments
1
|
16 | 17 | 115 | 117 | ||||||||||||||||||||||||||||
Refinancing expense
2
|
| | 16 | | ||||||||||||||||||||||||||||
Adjusted earnings (loss) from continuing
operations before tax
|
144 | 104 | 667 | 368 | ||||||||||||||||||||||||||||
Income tax (provision) benefit on adjusted earnings
3
|
(29 | ) | (24 | ) | (133 | ) | (93 | ) | ||||||||||||||||||||||||
Less: Noncontrolling interests
|
| | | | ||||||||||||||||||||||||||||
Adjusted earnings (loss) from continuing
operations
|
115 | 0.73 | 80 | 0.51 | 534 | 3.37 | 275 | 1.75 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Diluted shares (in millions)
4
|
||||||||||||||||||||||||||||||||
Weighted average shares outstanding
|
155.7 | 144.1 | 154.6 | 143.7 | ||||||||||||||||||||||||||||
Assumed conversion of preferred stock
|
| 12.1 | 1.6 | 12.1 | ||||||||||||||||||||||||||||
Dilutive restricted stock units
|
0.6 | 0.3 | 0.4 | 0.2 | ||||||||||||||||||||||||||||
Dilutive stock options
|
2.0 | 1.9 | 1.8 | 1.1 | ||||||||||||||||||||||||||||
Total diluted shares
|
158.3 | 158.4 | 158.4 | 157.1 | ||||||||||||||||||||||||||||
1 | See Table 7 for details. | |
2 | Relates to the issuance of senior unsecured notes and the amendment and extension of the existing credit agreement. | |
3 | The adjusted effective tax rate is 20% for the three and twelve months ended December 31, 2010. The adjusted effective tax rate is 29% for the six months ended June 30, 2009 and 23% for the six months ended December 31, 2009. | |
4 | Potentially dilutive shares are included in the adjusted earnings per share calculation when adjusted earnings are positive. | |
5 | The companys Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes. |
Three Months Ended | Twelve Months Ended | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
(in $ millions) | 2010 | 2009 | 2010 | 2009 | |||||||||||||
Employee termination benefits
|
6 | 11 | 32 | 105 | |||||||||||||
Plant/office closures
|
| (3 | ) | 4 | 17 | ||||||||||||
Ticona Kelsterbach plant relocation
|
9 | 6 | 26 | 16 | |||||||||||||
Plumbing actions
|
(17 | ) | (7 | ) | (57 | ) | (10 | ) | |||||||||
Asset impairments
|
1 | 6 | 74 | 14 | |||||||||||||
Insurance recoveries
|
| | (18 | ) | (6 | ) | |||||||||||
Resolution of commercial disputes
|
2 | | (13 | ) | | ||||||||||||
Total
|
1 | 13 | 48 | 136 | |||||||||||||
Other Adjustments: 1 |
Three Months Ended | Twelve Months Ended | Income | ||||||||||||||||
December 31, | December 31, | Statement | ||||||||||||||||
(in $ millions) | 2010 | 2009 | 2010 | 2009 | Classification | |||||||||||||
Business optimization
|
6 | 4 | 16 | 7 | Cost of sales / SG&A | |||||||||||||
Ticona Kelsterbach plant relocation
|
(6 | ) | (3 | ) | (13 | ) | | Cost of sales | ||||||||||
Plant closures
|
3 | 9 | 17 | 25 | Cost of sales / SG&A | |||||||||||||
Contract termination
|
| | 22 | | Cost of sales | |||||||||||||
(Gain) loss on disposition of assets
|
5 | | (10 | ) | | (Gain) loss on disposition | ||||||||||||
(Gain) on sale of PVOH business
|
| | | (34 | ) | (Gain) loss on disposition | ||||||||||||
Write-off of other productive assets
|
1 | | 18 | | Cost of sales | |||||||||||||
Other
2
|
6 | (6 | ) | 17 | (17 | ) | Various | |||||||||||
Total
|
15 | 4 | 67 | (19 | ) | |||||||||||||
|
||||||||||||||||||
Total other charges and other
adjustments
|
16 | 17 | 115 | 117 | ||||||||||||||
1 | These items are included in net earnings but not included in other charges. | |
2 | The twelve months ended December 31, 2009 includes a one-time adjustment to Equity in net earnings (loss) of affiliates of $19 million. |
Page 15 of 16
Three Months Ended
Twelve Months Ended
December 31,
December 31,
(in $ millions)
2010
2009
2010
2009
As Adjusted
5
As Adjusted
5
400
344
1,543
1,105
205
203
923
630
579
642
2,070
2,186
1,184
1,189
4,536
3,921
43
23
222
58
84
87
400
253
31
16
101
103
158
126
723
414
22
21
85
87
8
11
33
31
26
28
101
103
56
60
219
221
65
44
307
145
92
98
433
284
57
44
202
206
214
186
942
635
27
134
15
74
76
357
222
20
11
75
72
121
87
566
309
53
131
53
131
(64
)
(39
)
(64
)
(39
)
277
491
277
491
266
583
266
583
1 | Ticona Affiliates Asia accounted for using the equity method includes Polyplastics (45%), Korean Engineering Plastics (50%), Fortron Industries (50%), Una SA (50%). | |
2 | Ticona Affiliates Middle East accounted for using the equity method includes National Methanol Company (IBN Sina) (25%). | |
3 | Infraserv Affiliates accounted for using the equity method includes Infraserv Hoechst (32%), Infraserv Gendorf (39%) and Infraserv Knapsack (27%). | |
4 | Affiliate EBITDA, a non-U.S. GAAP measure, is the sum of Operating Profit and Depreciation and Amortization. | |
5 | The companys Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes. |
Page 16 of 16
Three Months Ended
Twelve Months Ended
December 31,
December 31,
(in $ millions)
2010
2009
2010
2009
As Adjusted
8
As Adjusted
8
185
159
713
510
51
50
231
157
190
210
679
707
426
419
1,623
1,374
20
11
103
28
21
22
100
63
11
6
33
33
52
39
236
124
10
10
39
40
2
3
8
8
8
9
33
33
20
22
80
81
30
21
142
68
23
25
108
71
19
15
66
66
72
61
316
205
13
63
7
17
18
81
51
7
4
24
22
37
22
168
80
17
21
79
61
6
7
27
20
12
11
42
44
35
39
148
125
23
58
23
58
(16
)
(10
)
(16
)
(10
)
89
162
89
162
96
210
96
210
1 | Ticona Affiliates Asia accounted for using the equity method includes Polyplastics (45%), Korean Engineering Plastics (50%), Fortron Industries (50%), Una SA (50%). | |
2 | Ticona Affiliates Middle East accounted for using the equity method includes National Methanol Company (IBN Sina) (25%). | |
3 | Infraserv Affiliates accounted for using the equity method includes Infraserv Hoechst (32%), Infraserv Gendorf (39%) and Infraserv Knapsack (27%). | |
4 | Affiliate EBITDA, a non-U.S. GAAP measure, is the sum of Operating Profit and Depreciation and Amortization. | |
5 | Calculated by multiplying each affiliates total share amount by Celaneses respective ownership percentage, netted by reporting category. | |
6 | Calculated as Affiliate EBITDA less Equity in net earnings of affiliates; not included in Celanese operating EBITDA. | |
7 | The year ended December 31, 2009 excludes a one-time tax adjustment to Equity in net earnings of affiliates of $19 million. | |
8 | The companys Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes. |
Dave Weidman, Chairman and Chief Executive Officer Steven Sterin, Senior Vice President and Chief Financial Officer Celanese 4Q 2010 Earnings Conference Call / Webcast Tuesday, February 1, 2011 10:00 a.m. ET |
Forward looking statements Reconciliation and use of non-GAAP measures to U.S. GAAP This presentation may contain "forward-looking statements," which include information concerning the company's 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 results expressed or implied in the forward-looking statements contained in this release. These risks and uncertainties include, among other things: changes in general economic, business, political and regulatory conditions in the countries or regions in which we operate; the length and depth of business cycles, particularly in the automotive, electrical, electronics and construction industries; changes in the price and availability of raw materials; the ability to pass increases in raw material prices on to customers or otherwise improve margins through price increases; the ability to maintain plant utilization rates and to implement planned capacity additions and expansions; the ability to improve productivity by implementing technological improvements to existing plants; increased price competition and the introduction of competing products by other companies; market acceptance of our technology; the ability to obtain governmental approvals and to construct facilities on terms and schedule acceptable to the company; changes in the degree of intellectual property and other legal protection afforded to our products; compliance and other costs and potential disruption of production due to accidents or other unforeseen events or delays in construction or operation of facilities; potential liability for remedial actions and increased costs under existing or future environmental regulations, including those relating to climate change; potential liability resulting from pending or future litigation, or from changes in the laws, regulations or policies of governments or other governmental activities in the countries in which we operate; changes in currency exchange rates and interest rates; and various other factors discussed from time to time in the company's 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 presentation reflects the following performance measures: operating EBITDA, business operating EBITDA, proportional affiliate EBITDA and 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 and business EBITDA is operating profit; for proportional affiliate EBITDA is equity in net earnings of affiliates; for affiliate EBITDA is operating profit; 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 net earnings plus loss (earnings) from discontinued operations, interest expense, taxes and depreciation and amortization, and further adjusted for Other Charges and Adjustments as described in Table 7. 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. Business operating EBITDA, a measure used by management to measure performance of its internal operations, is defined by the company as net earnings plus loss (earnings) from discontinued operations, interest expense, taxes and depreciation and amortization, and further adjusted for Other Charges and Adjustments as described in Table 7, less equity in net earnings of affiliates, dividend income from cost investments and other (income) expense. This reflects the operating results of the company's operations without regard to its equity and cost investments. The company believes that investors should consider business operating EBITDA when evaluating the company's internal operations. Proportional 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. Affiliate EBITDA is defined by the company as operating profit plus the depreciation and amortization of its equity affiliates. 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. 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 management's 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 company's capital structure. Our management and credit analysts use net debt to evaluate the company's 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 company's cash flow. Our management and credit analysts use adjusted free cash flow to evaluate the company's liquidity and assess credit quality. Results Unaudited The results presented in this presentation, 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. |
Dave Weidman Chairman and Chief Executive Officer |
Celanese Corporation 4Q and full year 2010 highlights in millions (except EPS) 4th Qtr 2010 4th Qtr 2009 FY 2010 FY 2009 Net Sales $1,507 $1,388 $5,918 $5,082 Proportional Net Sales from Affiliates $426 $419 $1,623 $1,374 Total: $1,933 $1,807 $7,541 $6,456 Operating Profit/(Loss) $138 $109 $501 $290 Adjusted EPS $0.73 $0.51 $3.37 $1.75 Operating EBITDA $262 $228 $1,122 $857 Affiliate EBITDA in excess of Equity in net earnings of affiliates* $35 $39 $148 $125 Total: $297 $267 $1,270 $982 4th Quarter 2010: Strong results driven by overall higher volume and pricing with expanded margins Global demand remains healthy across all business lines * See slides 22 and 23 for equity affiliate preliminary results and Celanese proportional share |
Represents ~ $0.60 per share in 2011 earnings improvement 2x to 3x GDP revenue growth Strong earnings conversion Robust technology-rich pipeline Continued earnings growth Closure of Spondon flake and tow Strong operating margins Growth in Asia Process innovation and productivity Sustained acid margins ~ $150 million Operating EBITDA improvement Nanjing VAE capacity expansion Higher margin new products High growth EVA applications Increasingly advantaged portfolio drives 2011 earnings improvement Advanced Engineered Materials Consumer Specialties Industrial Specialties Acetyl Intermediates |
Steven Sterin Senior Vice President and Chief Financial Officer |
4th Quarter 2010: Strong volume growth and higher value-in-use pricing, offset by currency Operating EBITDA flat as improved revenue offset by raw materials, turnaround and timing of other costs Continued building inventory for European expansion Outlook: Seasonally strong demand and pricing environment, higher raw materials Continue building inventory to support European expansion mid to late 2011 Competitor outage in 2010 affects year-over-year comparisons Advanced Engineered Materials in millions 4th Qtr 2010 4th Qtr 2009 FY 2010 FY 2009 Net Sales $274 $239 $1,109 $808 Operating EBITDA $68 $68 $363 $186 |
4th Quarter 2010: Higher volume on increased global demand, primarily in acetate products Margin expansion driven by sustainable productivity initiatives that more than offset higher raw material and energy costs Outlook: Normal seasonality in first quarter Strong demand and expanded margins Year-over-year comparison magnified by outage at Narrows in 2010 Consumer Specialties in millions 4th Qtr 2010 4th Qtr 2009 FY 2010 FY 2009 Net Sales $281 $267 $1,098 $1,084 Operating EBITDA $80 $65 $371 $348 |
4th Quarter 2010: Higher pricing and volume driven by strong demand and innovation, particularly in photovoltaic applications Emulsions business in Asia at full utilization ahead of VAE capacity expansion in Nanjing, China mid-2011 Outlook: Stronger seasonal demand driving volume growth Margin expansion due to robust pricing environment and higher volumes Industrial Specialties in millions 4th Qtr 2010 4th Qtr 2009 FY 2010 FY 2009 Net Sales $249 $229 $1,036 $974 Operating EBITDA $27 $19 $111 $109 |
Acetyl Intermediates 4th Quarter 2010: Strong results driven by improved global demand and higher pricing, particularly in downstream derivatives China focus on end of year energy reduction affected competing technologies Improved pricing environment with higher raw materials Outlook: Expect modest volume seasonality associated with Chinese New Year Advantaged acetyl technology sustains acetic acid margins in millions 4th Qtr 2010 4th Qtr 2009 FY 2010 FY 2009 Net Sales $799 $743 $3,082 $2,603 Operating EBITDA $127 $111 $411 $315 |
Provide growth in emerging markets and structural raw material hedge FY 2010 results Received $73 million of cash dividends from cost investments (Q2 2010) Equity affiliates contributed $168 million to earnings with an additional $148 million proportional EBITDA not included in Operating EBITDA Affiliate performance FY 2010 FY 2009* Earnings from Equity Affiliates 168 80 Dividends from Cost Investments 73 57 Income Statement * Full year 2009 excludes a one-time tax adjustment to Equity in net earnings of affiliates of $19 million. FY 2010 FY 2009* Earnings from Equity Affiliates 168 80 Proportional Affiliate EBITDA in Excess of Equity Earnings 148 125 Earnings and Proportional EBITDA |
Free cash flow FY 2010 Adjusted Free Cash Flow Adjusted Free Cash Flow Adjusted Free Cash Flow $ in millions FY 2010 FY 2009 Net cash provided by operating activities $452 $596 Adjustments to operating cash for discontinued operations $58 $2 Net cash provided by operating activities from continuing operations $510 $598 Less: Capital expenditures ($201) ($176) Add: Other charges and adjustments1 ($15) ($12) Adjusted Free Cash Flow2 $294 $410 1Amounts primarily associated with cash outflows for purchases of other productive assets that are classified as 'investing activities' for U.S. GAAP purposes 2Excludes Ticona Kelsterbach expansion cash flows Strong business performance offset by: Higher taxes ($135 million in 2010 vs. $17 million in 2009) Increase in working capital ($224 million) to support growth |
2011E Adjusted Free Cash Outflows (off EBITDA Base) 2011E Adjusted Free Cash Outflows (off EBITDA Base) Cash Taxes $75 - $100 Capital Expenditures $300 - $350 Reserve/Other $100 - $120 Net Interest $220 - $230 Pension $120 - $140 Working Capital $30 - $50 Adjusted Cash Outflows* $845 - $990 Dividend, debt service and share repurchases of ~$90-110 million Expect approximately $100 million net cash outflow for Kelsterbach expansion in 2011, including capital expenditures and project expense Strong cash generation continues throughout economic cycle Available Cash Available Cash Cash (as of 12/31/2010) $740 Operating Cash ~($100 - $200) Cash Available for Strategic Purposes ~$600 $ in millions $ in millions * Excludes Ticona Kelsterbach expansion cash flows |
Appendix Notes: References on the following slides to tables correspond to the tables included with Celanese press release dated February 1, 2011 |
Reg G: Segment Data and Reconciliation of Operating Profit (Loss) to Operating EBITDA - Non-U.S. GAAP Measure (Table 1) - unaudited |
Reg G: Reconciliation of consolidated Operating EBITDA to net earnings (loss) - Non-U.S. GAAP Measure (Table 1A) - unaudited |
Reg G: Reconciliation of net debt (Table 5) - Non-U.S. GAAP Measure - unaudited |
Reg G: Reconciliation of adjusted EPS (Table 6) - Non-U.S. GAAP Measure - unaudited |
Reg G: Reconciliation of other charges and other adjustments (Table 7) - Non-U.S. GAAP Measure - unaudited |
4Q 2010 Other charges and other adjustments by segment - Non-U.S. GAAP Measure - unaudited |
FY 2010 Other charges and other adjustments by segment - Non-U.S. GAAP Measure - unaudited |
Reg G: Equity affiliate preliminary results - Total (Table 8) - Non-U.S. GAAP Measure - unaudited |
Reg G: Equity affiliate preliminary results and Celanese proportional share (Table 8 continued) - Non-U.S. GAAP Measure - unaudited |