SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 28, 2009
CELANESE CORPORATION
(Exact Name of Registrant as specified in its charter)
         
DELAWARE   001-32410   98-0420726
         
(State or other jurisdiction   (Commission File   (IRS Employer
of incorporation)   Number)   Identification No.)
1601 West LBJ Freeway, Dallas, Texas 75234-6034
(Address of Principal Executive Offices) (Zip Code)
Registrant’s telephone number, including area code: (972) 443-4000
Not Applicable
(Former name or former address, if changed since last report):
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
o   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
o   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 

 


 

Item 2.02 Results of Operations and Financial Condition
     On April 28, 2009, Celanese Corporation (the “ Company ”) issued a press release reporting the financial results for its first quarter 2009. A copy of the press release is attached to this Current Report on Form 8-K (“ Current Report ”) as Exhibit 99.1 and is incorporated herein solely for purposes of this Item 2.02 disclosure.
Item 7.01 Regulation FD Disclosure
     On April 28, 2009, David N. Weidman, Chairman and Chief Executive Officer of the Company, and Steven M. Sterin, Senior Vice President and Chief Financial Officer of the Company, will make a presentation to investors and analysts via a webcast hosted by the Company at 9:00 a.m. CT. The webcast and slide presentation may be accessed on our website at www.celanese.com under Investor/Presentations & Webcasts. A copy of the slide presentation posted during the webcast is attached to this Current Report as Exhibit 99.2 and is incorporated herein solely for purposes of this Item 7.01 disclosure.
Item 9.01 Financial Statements and Exhibits.
     (d) Exhibits
     
Exhibit Number   Description
 
   
99.1
  Press Release dated April 28, 2009*
 
   
99.2
  Slide Presentation dated April 28, 2009*
 
*   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.

 


 

SIGNATURES
     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
             
    CELANESE CORPORATION    
 
           
 
  By:   /s/ Steven M. Sterin
 
Name:     Steven M. Sterin
Title:       Senior Vice President and
                Chief Financial Officer
   
Date: April 28, 2009

 


 

Exhibit Index
     
Exhibit Number   Description
 
   
99.1
  Press Release dated April 28, 2009*
 
99.2
  Slide Presentation dated April 28, 2009*
 
*   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.

 

Exhibit 99.1
(CELANESE LOGO)
     
 
  Celanese Corporation
 
  Investor Relations
Corporate News Release
  1601 West LBJ Freeway
 
  Dallas, Texas 75234-6034
Celanese Corporation Reports First Quarter Results; Strong Cash Position
First quarter highlights:
  §   Net sales were $1,146 million, down 38% from prior year period
 
  §   Operating profit was $27 million versus $234 million in prior year period
 
  §   Net earnings were ($20) million versus $145 million in prior year period
 
  §   Operating EBITDA was $136 million versus $381 million in prior year period
 
  §   Diluted EPS from continuing operations was ($0.17) versus $0.87 in prior year period
 
  §   Adjusted EPS was $0.08 versus $1.06 in prior year period
                 
    Three Months Ended
    March 31,
 
(in $ millions, except per share data)   2009   2008
 
Net sales
    1,146       1,846  
Operating profit (loss)
    27       234  
Net earnings (loss) attributable to the Company
    (20 )     145  
Operating EBITDA 1
    136       381  
Diluted EPS — continuing operations
  $ (0.17 )   $ 0.87  
Diluted EPS — total
  $ (0.16 )   $ 0.87  
Adjusted EPS 1
  $ 0.08     $ 1.06  
 
 
1   Non-U.S. GAAP measures. See reconciliation in tables 1 and 6.
Dallas, April 28, 2009: Celanese Corporation (NYSE: CE), a leading global chemical company, today reported first quarter 2009 net sales of $1,146 million, a 38 percent decrease from the same period last year, primarily driven by lower volumes on continued weak global demand and lower pricing for acetyl products. Higher pricing in Advanced Engineered Materials’ and Consumer Specialties’ products partially offset the declines in other businesses. Operating profit was $27 million compared with $234 million in the same period last year as the decrease in net sales more than offset lower raw material and energy costs, as well as reduced manufacturing, selling, general and administrative expenses related to the company’s fixed spending reduction efforts. Included in the results were a net of $33 million pre-tax of other charges and other adjustments primarily associated with fixed spending reduction efforts and the announced shutdown of the vinyl acetate monomer (VAM) unit at the company’s Cangrejera, Mexico facility. Net earnings were a loss of $20 million compared with a profit of $145 million in the prior year period, with contributions from equity and cost investments $34 million lower than last year’s results. With the exception of automotive and electronics, global demand for the company’s products improved sequentially as the impacts of inventory destocking throughout its end-consumer supply chains diminished.
Adjusted earnings per share for the first quarter of 2009 were $0.08 compared with $1.06 in the same period last year. Results included an estimated total inventory accounting impact of approximately $32 million before taxes related to the negative effects of first-in, first-out (FIFO) accounting. The effective tax rate and diluted share

 


 

     Page 2 of 13
count used in adjusted earnings per share in the current period were 29 percent and 155.6 million, respectively. Operating EBITDA was $136 million in the first quarter of 2009 versus $381 million in the prior year period. The quarter’s results excluded the net of $33 million pre-tax of other charges and other adjustments.
“Although general economic conditions at the consumer level remained weak, we began to realize the positive impacts of reduced inventory destocking throughout our customers’ supply chains as the quarter progressed,” said David Weidman, chairman and chief executive officer. “The leading global franchises of our integrated business model, particularly our Consumer and Industrial Specialties businesses, continued to execute their strategies and delivered strong results during these challenging times. Additionally, our fixed spending reduction actions have already begun to yield sustainable benefits. Our cash position remains very strong and we continue to expect positive free cash flow in 2009.”
Recent Highlights
  §   Entered into an agreement to sell its polyvinyl alcohol (PVOH) business to Sekisui Chemical Co., Ltd. for a purchase price of approximately $173 million, excluding the value of accounts receivable and payable retained by Celanese. This transaction is expected to be completed by mid-year 2009.
 
  §   Permanently shut down the VAM production unit at the Cangrejera, Mexico site during the first quarter of 2009.
 
  §   Initiated a project of closure of its acetic acid and VAM units in Pardies, France. This project follows the assessment phase initiated in January 2009 regarding the potential closure of the site and the acetic acid and VAM operations.
 
  §   Realigned its executive leadership team to support ongoing productivity efforts and position the company for sustainable long-term value creation. Sandy Beach Lin and Doug Madden were both named corporate executive vice presidents.
 
  §   Received a $412 million advance payment from the Frankfurt, Germany, Airport (Fraport AG) associated with the relocation of the Ticona business in Kelsterbach, Germany.
First Quarter Segment Overview
Consumer Specialties
Consumer Specialties continued to deliver improved performance as margins expanded in these less economically sensitive businesses. Net sales in the first quarter of 2009 were $266 million, a $16 million decrease from the same period last year. Higher pricing on continued strong global demand for the company’s acetate products only partially offset lower volumes primarily related to the timing of customer contract negotiations and lower acetate flake sales. Operating profit was $66 million, a $16 million increase from a year ago, due to the higher pricing, favorable currency and lower spending and energy costs. Operating EBITDA was $81 million in the period compared with $65 million in the first quarter of 2008.

 


 

     Page 3 of 13
Industrial Specialties
Industrial Specialties delivered solid results with expanded margins, despite weak global demand and the impact of the company’s AT Plastics plant outage. Net sales in the first quarter were $242 million, a decrease of $123 million from the prior year period, primarily due to lower volumes in Europe and North America, as well as the effect of the AT Plastics force majeure. The lower volumes were attributed to weakened demand across all industries, but were most pronounced in automotive and construction associated with its polyvinyl alcohol business. The company’s continued success in Asia helped to partially offset the weaker demand in other regions. Operating profit was $10 million compared with $17 million in the same period last year, however, margins expanded in this downstream business. Lower raw material and energy costs, along with the benefits of the company’s fixed spending reductions, more than offset slightly lower pricing. Operating EBITDA was $26 million compared with $36 million in the prior year period. This quarter’s results included approximately $6 million of inventory accounting impact.
Advanced Engineered Materials
Although Advanced Engineered Materials maintained increased pricing for its high value-in-use engineered polymers, significant volume declines continued to impact overall segment performance. Net sales in the first quarter were $165 million, a $129 million decrease from the prior year period. Volumes decreased by 43 percent year-over-year, primarily due to reduced automotive production in the U.S. and Europe, continued inventory destocking in electrical/electronic and other industrial applications, and modestly weaker demand in Asia. The lower volumes and negative impacts of currency more than offset the higher pricing. Operating profit in the first quarter was a loss of $19 million compared with a profit of $30 million in the same period last year as the higher pricing, reduced raw material and energy costs, and lower spending could not offset the lower volumes. Operating EBITDA was $0 compared with $60 million in the first quarter of 2008. Equity in net earnings from the Advanced Engineered Materials’ strategic affiliates were a loss of $8 million, $17 million lower than the prior year period, as they experienced similar pressures on volumes and earnings. This quarter’s results included approximately $5 million of inventory accounting impact.
Acetyl Intermediates
Acetyl Intermediates continued to experience the impacts of industry destocking early in the first quarter of 2009 and reduced global demand for its acetyl products throughout the period. Net sales in the quarter were $572 million, a 48 percent decrease from the prior year period, due to lower pricing and lower volumes. Pricing declined as the industry experienced lower utilization rates on reduced global demand compared with the prior year period, particularly in Europe and the Americas. The lower industry utilization, as well as lower raw material input costs, negatively impacted pricing in the quarter. Although demand in Europe and the Americas remained weak and unchanged from the fourth quarter of 2008, demand for the company’s products in Asia increased sequentially, primarily due to the diminishing impact of inventory destocking throughout the quarter. Operating profit was $12 million compared with $177 million in the same period last year as the lower raw material and energy costs, as well as the benefits of the company’s fixed spending reduction efforts, were more

 


 

     Page 4 of 13
than offset by the lower revenue. Operating EBITDA was $48 million compared with $246 million in the same period last year. Dividends from the company’s cost investments, including its Ibn Sina cost affiliate, were $3 million compared with $27 million in the prior year period, due to significantly lower global pricing for methanol and methyl tertiary-butyl ether (MTBE). This quarter’s results included approximately $21 million of inventory accounting impact.
Taxes
The tax rate for adjusted earnings per share was 29 percent in the first quarter of 2009 compared with 26 percent in the first quarter of 2008. The U.S. GAAP effective tax rate for continuing operations for the first quarter of 2009 was negative 31 percent versus 33 percent in the first quarter of 2008. The change in the effective income tax rate is primarily due to an increase in valuation allowance on certain expected foreign net operating losses for the current year, lower earnings in jurisdictions participating in tax holidays, and increases in reserves for uncertain tax positions and related interest. The company had a net cash tax refund of $5 million in the first quarter of 2009 compared with $29 million of cash taxes paid in the first quarter of 2008. The decrease in cash taxes paid is primarily the result of a tax refund 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 company’s adjusted earnings and operating EBITDA, were $4 million compared with $38 million in the prior year period, primarily driven by significantly lower dividends from the company’s Ibn Sina cost affiliate and lower earnings from the Advanced Engineered Materials equity affiliates. Ibn Sina’s reduced dividends were attributed to lower methanol and MTBE pricing, while lower earnings from the company’s equity affiliates were driven by dramatically lower volumes in automotive and other industries. Equity and cost investment dividends, which are included in cash flows, were $24 million, a $47 million decrease from results in the same period last year, due to both lower dividends from the Ibn Sina cost affiliate as well as lower dividends from the equity affiliates.
Cash Flow
Cash and cash equivalents at the end of the first quarter of 2009 were $1,150 million compared with $763 million at the end of the first quarter of 2008. Cash flow provided by operating activities was $199 million in the quarter, an increase of $33 million compared to the prior year period. Favorable trade working capital, lower cash taxes and reduced capital expenditures helped to offset the lower operating performance. During the first quarter of 2009, the company received a payment of $412 million related to the relocation of Ticona’s business in Kelsterbach, Germany, which is reflected in investing activities. Additionally, the company received $75 million in associated value-added tax, reflected in operating activities, which will be paid in the second quarter of 2009. Net debt at the end of the first quarter of 2009 was $2,319 million, a $538 million decrease from the end of the fourth quarter of 2008, on positive adjusted free cash flow and the advance payment from Fraport AG.

 


 

     Page 5 of 13
Outlook
“We do not currently expect any significant improvement in end-consumer demand throughout 2009. However, as we moved out of the first quarter, we believe that the majority of inventory destocking through our customer supply chains is behind us, with the possible exception of the automotive and electronics industries,” said Weidman. “As destocking in these areas abates, we would expect all of our businesses to perform at their ‘normalized trough’ profiles. We also expect to realize further benefits of the sustainable actions the company has taken to ensure our success during both this current recession as well as the future recovery.”
         
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 69 305 7137
Telefax: +1 972 443 8519
  Telefax: +1 972 443 8519   Telefax: +49 69 305 36787
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 $6.8 billion in 2008, with approximately 65% 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 8,000 employees worldwide. For more information on Celanese Corporation, please visit the company’s website at www.celanese.com .
Forward-Looking Statements
This release 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 forward-looking statements contained in this release. Numerous factors, many of which are beyond the company’s control, could cause actual results to differ materially from those expressed as forward-looking statements. Certain of these risk factors are discussed 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.

 


 

     Page 6 of 13
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. 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 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 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. Operating EBITDA is not a recognized term under U.S. GAAP and does not purport to be an alternative to operating profit as a measure of operating performance or to cash flows from operating activities as a measure of liquidity. Because not all companies use identical calculations, this presentation of operating EBITDA may not be comparable to other similarly titled measures of other companies. Additionally, operating EBITDA is not intended to be a measure of free cash flow for management’s discretionary use, as it does not consider certain cash requirements such as interest payments, tax payments and debt service requirements nor does it represent the amount used in our debt covenants.
 
  §   Affiliate EBITDA, a measure used by management to measure performance of its equity investments, is defined as the proportional operating profit plus the proportional depreciation and amortization of its equity investments. Affiliate EBITDA, including Celanese Proportional Share of affiliate information on Table 8, is not a recognized term under U.S. GAAP and is not meant to be an alternative to operating cash flow of the 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 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 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. This non-U.S. GAAP information is not intended to be considered in isolation or as a substitute for U.S. GAAP financial information.
 
  §   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 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 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. This non-U.S. GAAP information is not intended to be considered in isolation or as a substitute for U.S. GAAP financial information.
 
  §   Adjusted free cash flow is defined 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. This non-U.S. GAAP information is not intended to be considered in isolation or as a substitute for U.S. GAAP financial information.
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)   2009     2008  
 
Net sales
    1,146       1,846  
Cost of sales
    (946 )     (1,428 )
         
Gross profit
    200       418  
 
               
Selling, general and administrative expenses
    (114 )     (136 )
Amortization of Intangible assets 1
    (17 )     (19 )
Research and development expenses
    (20 )     (23 )
Other (charges) gains, net
    (21 )     (16 )
Foreign exchange gain (loss), net
    2       7  
Gain (loss) on disposition of businesses and assets, net
    (3 )     3  
         
Operating profit
    27       234  
 
               
Equity in net earnings (loss) of affiliates
    (2 )     10  
Interest expense
    (51 )     (67 )
Interest income
    3       9  
Dividend income — cost investments
    6       28  
Other income (expense), net
    1       4  
         
Earnings (loss) from continuing operations before tax
    (16 )     218  
 
               
Income tax (provision) benefit
    (5 )     (73 )
         
Earnings (loss) from continuing operations
    (21 )     145  
 
               
Earnings (loss) from operation of discontinued operations, net of tax
    1        
         
Earnings (loss) from discontinued operations
    1        
 
               
Net earnings (loss)
    (20 )     145  
Less: Net earnings (loss) attributable to noncontrolling interests
           
         
Net earnings (loss) attributable to the Company
    (20 )     145  
 
 
               
Cumulative preferred stock dividend
    (3 )     (3 )
         
Net earnings (loss) available to common shareholders
    (23 )     142  
 
 
               
Earnings (loss) per common share — basic
               
Continuing operations
  $ (0.17 )   $ 0.93  
Discontinued operations
    0.01        
         
Net earnings (loss) — basic
  $ (0.16 )   $ 0.93  
 
 
               
Earnings (loss) per common share — diluted
               
Continuing operations
  $ (0.17 )   $ 0.87  
Discontinued operations
    0.01        
         
Net earnings (loss) — diluted
  $ (0.16 )   $ 0.87  
 
 
               
Weighted average shares (millions)
               
Basic
    143.5       152.0  
Diluted
    143.5       167.3  
 
 
1   Customer related intangibles

 


 

     Page 8 of 13
Preliminary Consolidated Balance Sheets — Unaudited
                 
    March 31,   December 31,
(in $ millions)   2009   2008
 
ASSETS
               
Current Assets
               
Cash & cash equivalents
    1,150       676  
Trade receivables — third party and affiliates, net
    624       631  
Non-trade receivables
    222       274  
Inventories
    522       577  
Deferred income taxes
    24       24  
Marketable securities, at fair value
    5       6  
Other assets
    42       96  
     
Total current assets
    2,589       2,284  
 
               
Investments in affiliates
    720       789  
Property, plant and equipment, net
    2,482       2,472  
Deferred income taxes
    29       27  
Marketable securities, at fair value
    80       94  
Other assets
    344       357  
Goodwill
    758       779  
Intangible assets, net
    335       364  
     
Total assets
    7,337       7,166  
     
 
               
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
Current liabilities
               
Short-term borrowings and current installments of long-term debt — third party and affiliates
    195       233  
Trade payables — third party and affiliates
    504       523  
Other liabilities
    576       574  
Deferred income taxes
    14       15  
Income taxes payable
    10       24  
     
Total current liabilities
    1,299       1,369  
 
               
Long-term debt
    3,274       3,300  
Deferred income taxes
    118       122  
Uncertain tax positions
    218       218  
Benefit obligations
    1,162       1,167  
Other liabilities
    1,219       806  
Commitments and contingencies
               
Shareholders’ equity
               
Preferred stock
           
Common stock
           
Treasury stock, at cost
    (781 )     (781 )
Additional paid-in capital
    498       495  
Retained earnings
    1,018       1,047  
Accumulated other comprehensive income (loss), net
    (690 )     (579 )
     
Total Company shareholders’ equity
    45       182  
Noncontrolling interests
    2       2  
     
Total shareholders’ equity
    47       184  
     
Total liabilities and shareholders’ equity
    7,337       7,166  
     

 


 

     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)   2009   2008
 
Net Sales
               
Advanced Engineered Materials
    165       294  
Consumer Specialties
    266       282  
Industrial Specialties
    242       365  
Acetyl Intermediates
    572       1,096  
Other Activities 1
           
Intersegment eliminations
    (99 )     (191 )
           
Total
    1,146       1,846  
 
 
               
Operating Profit (Loss)
               
Advanced Engineered Materials
    (19 )     30  
Consumer Specialties
    66       50  
Industrial Specialties
    10       17  
Acetyl Intermediates
    12       177  
Other Activities 1
    (42 )     (40 )
           
Total
    27       234  
 
 
               
Equity Earnings, Cost — Dividend Income and Other Income (Expense)
               
Advanced Engineered Materials
    (8 )     9  
Consumer Specialties
    3        
Industrial Specialties
           
Acetyl Intermediates
    4       29  
Other Activities 1
    6       4  
           
Total
    5       42  
 
 
               
Other Charges and Other Adjustments 2
               
Advanced Engineered Materials
    10       1  
Consumer Specialties
          1  
Industrial Specialties
    3       5  
Acetyl Intermediates
    5       8  
Other Activities 1
    15       7  
           
Total
    33       22  
 
 
               
Depreciation and Amortization Expense
               
Advanced Engineered Materials
    17       20  
Consumer Specialties
    12       14  
Industrial Specialties
    13       14  
Acetyl Intermediates
    27       32  
Other Activities 1
    2       3  
           
Total
    71       83  
 
 
               
Operating EBITDA
               
Advanced Engineered Materials
          60  
Consumer Specialties
    81       65  
Industrial Specialties
    26       36  
Acetyl Intermediates
    48       246  
Other Activities 1
    (19 )     (26 )
           
Total
    136       381  
 
 
1   Other Activities primarily includes corporate selling, general and administrative expenses and the results from captive insurance companies.
 
2   See Table 7.

 


 

     Page 10 of 13
Table 2
Factors Affecting First Quarter 2009 Segment Net Sales Compared to First Quarter 2008
                                         
(in percent)   Volume   Price   Currency   Other 1   Total
 
Advanced Engineered Materials
    -43 %     4 %     -5 %     0 %     -44 %
Consumer Specialties
    -11 %     8 %     -3 %     0 %     -6 %
Industrial Specialties
    -26 %     -3 %     -5 %     0 %     -34 %
Acetyl Intermediates
    -19 %     -27 %     -2 %     0 %     -48 %
Total Company
    -25 %     -14 %     -4 %     5 %     -38 %
 
 
1   Includes the effects of the captive insurance companies and the impact of fluctuations in intersegment eliminations.
Table 3
Cash Flow Information
                 
    Three Months Ended
    March 31,
(in $ millions)   2009   2008
 
Net cash provided by operating activities
    199       166  
Net cash provided by (used in) investing activities 1
    311       (138 )
Net cash used in financing activities
    (48 )     (112 )
Exchange rate effects on cash
    12       22  
Cash and cash equivalents at beginning of period
    676       825  
 
Cash and cash equivalents at end of period
    1,150       763  
 
 
1   2009 includes $412 million of cash received and $58 million of capital expenditures related to the Ticona Kelsterbach plant relocation. 2008 includes no cash received and $28 million of capital expenditures related to the Ticona Kelsterbach plant relocation.
Table 4
Cash Dividends Received
                 
    Three Months Ended
    March 31,
(in $ millions)   2009   2008
 
Dividends from equity investments
    18       43  
Dividends from cost investments
    6       28  
 
Total
    24       71  
 

 


 

     Page 11 of 13
Table 5
Net Debt — Reconciliation of a Non-U.S. GAAP Measure
                 
    March 31,   December 31,
(in $ millions)   2009   2008
 
Short-term borrowings and current installments of long-term debt — third party and affiliates
    195       233  
Long-term debt
    3,274       3,300  
 
Total debt
    3,469       3,533  
Less: Cash and cash equivalents
    1,150       676  
 
Net Debt
    2,319       2,857  
 
 
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)   2009   2008
 
Earnings (loss) from continuing operations before tax
    (16 )     218  
Non-GAAP Adjustments:
               
Other charges and other adjustments 1
    33       22  
           
Adjusted Earnings (loss) from continuing operations before tax
    17       240  
Income tax (provision) benefit on adjusted earnings 2
    (5 )     (62 )
Noncontrolling interests
           
 
Adjusted Earnings (loss) from continuing operations
    12       178  
Preferred dividends
    (3 )     (3 )
 
Adjusted net earnings (loss) available to common shareholders
    9       175  
Add back: Preferred dividends
    3       3  
Adjusted net earnings (loss) for adjusted EPS
    12       178  
 
 
               
Diluted shares (millions) 3
               
Weighted average shares outstanding
    143.5       152.0  
Assumed conversion of preferred shares
    12.1       12.0  
Assumed conversion of restricted stock units
          0.5  
Assumed conversion of stock options
          2.8  
 
Total diluted shares
    155.6       167.3  
 
Adjusted EPS
    0.08       1.06  
   
 
1   See Table 7 for details
 
2   The adjusted tax rate for the three months ended March 31, 2009 is 29% based on the forecasted adjusted tax rate for 2009.
 
3   Potentially dilutive shares are included in the adjusted earnings per share calculation when adjusted earnings are positive.
 
4   The impact of inventory accounting adjustments on Adjusted EPS is $0.15 calculated as $32 million tax effected at 29% divided by 155.6 million diluted shares for the three months ended March 31, 2009.

 


 

     Page 12 of 13
Table 7
Reconciliation of Other Charges and Other Adjustments
Other Charges:
                 
    Three Months Ended
    March 31,
(in $ millions)   2009   2008
 
Employee termination benefits
    24       7  
Plant/office closures
          7  
Ticona Kelsterbach plant relocation
    3       2  
Clear Lake insurance recoveries
    (6 )      
Insurance recoveries associated with plumbing cases
    (1 )      
Asset impairments
    1        
 
Total
    21       16  
 
Other Adjustments: 1
                         
    Three Months Ended   Income
    March 31,   Statement
(in $ millions)   2009   2008   Classification
Business optimization
    2       9     SG&A
Ticona Kelsterbach plant relocation
    1       (2 )   Cost of sales
Plant closures
    4           Cost of sales
Other
    5       (1 )   Various
         
Total
    12       6          
         
 
                       
Total other charges and other adjustments
    33       22          
         
 
1   These items are included in net earnings but not included in other charges.

 


 

     Page 13 of 13
Table 8
Equity Affiliate Preliminary Results — Total — Unaudited
                 
    Three Months Ended
(in $ millions)   March 31,
    2009   2008
 
Net Sales
               
Ticona Affiliates 1
    172       355  
Infraserv 2
    510       548  
 
Total
    682       903  
 
 
               
Operating Profit
               
Ticona Affiliates
    (19 )     33  
Infraserv
    25       19  
 
Total
    6       52  
 
 
               
Depreciation and Amortization
               
Ticona Affiliates
    27       22  
Infraserv
    23       27  
 
Total
    50       49  
 
 
               
Affiliate EBITDA 3
               
Ticona Affiliates
    8       55  
Infraserv
    48       46  
 
Total
    56       101  
 
 
               
Net Income
               
Ticona Affiliates
    (16 )     19  
Infraserv
    19       (2 )
 
Total
    3       17  
 
 
               
Net Debt
               
Ticona Affiliates
    260       185  
Infraserv
    562       325  
 
Total
    822       510  
 
Equity Affiliate Preliminary Results — Celanese Proportional Share — Unaudited 4
                 
    Three Months Ended
(in $ millions)   March 31,
    2009   2008
 
Net Sales
               
Ticona Affiliates
    80       163  
Infraserv
    163       176  
 
Total
    243       339  
 
 
               
Operating Profit
               
Ticona Affiliates
    (8 )     15  
Infraserv
    8       6  
 
Total
          21  
 
 
               
Depreciation and Amortization
               
Ticona Affiliates
    12       10  
Infraserv
    7       9  
 
Total
    19       19  
 
 
               
Affiliate EBITDA 3
               
Ticona Affiliates
    4       25  
Infraserv
    15       15  
 
Total
    19       40  
 
 
               
Equity in net earnings of affiliates (as reported on the Income Statement)
               
Ticona Affiliates
    (8 )     9  
Infraserv
    6       1  
 
Total
    (2 )     10  
 
 
               
Affiliate EBITDA in excess of Equity in net earnings of affiliates 5
               
Ticona Affiliates
    12       16  
Infraserv
    9       14  
 
Total
    21       30  
 
 
               
Net Debt
               
Ticona Affiliates
    118       85  
Infraserv
    177       102  
 
Total
    295       187  
 
 
1   Ticona Affiliates includes Polyplastics (45% ownership), Korean Engineering Plastics (50%), Fortron Industries (50%), and Una SA (50%)
 
2   Infraserv includes Infraserv Entities valued as equity investments (Infraserv Höchst — 31% ownership, Infraserv Gendorf — 39% and Infraserv Knapsack 27%)
 
3   Affiliate EBITDA is the sum of Operating Profit and Depreciation and Amortization, a non-U.S. GAAP measure
 
4   Calculated as the product of figures from the above table times Celanese ownership percentage
 
5   Product of Celanese proportion of Affiliate EBITDA less Equity in net earnings of affiliates; not included in Celanese operating EBITDA

 

Exhibit 99.2
Dave Weidman, Chairman and CEO Steven Sterin, Senior Vice President and CFO Celanese 1Q 2009 Earnings Conference Call / Webcast Tuesday, April 28, 2009 10:00 a.m. ET


 

Forward Looking Statements, Reconciliation and Use of Non- GAAP Measures to U.S. GAAP Forward-Looking Statements 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 forward-looking statements contained in this release. Numerous factors, many of which are beyond the company's control, could cause actual results to differ materially from those expressed as forward-looking statements. Certain of these risk factors are discussed 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 five performance measures, operating EBITDA, affiliate EBITDA, adjusted earnings per share, net debt and adjusted free cash flow, as non-U.S. GAAP measures. 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 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 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. Operating EBITDA is not a recognized term under U.S. GAAP and does not purport to be an alternative to operating profit as a measure of operating performance or to cash flows from operating activities as a measure of liquidity. Because not all companies use identical calculations, this presentation of operating EBITDA may not be comparable to other similarly titled measures of other companies. Additionally, operating EBITDA is not intended to be a measure of free cash flow for management's discretionary use, as it does not consider certain cash requirements such as interest payments, tax payments and debt service requirements nor does it represent the amount used in our debt covenants. Affiliate EBITDA, a measure used by management to measure performance of its equity investments, is defined as the proportional operating profit plus the proportional depreciation and amortization of its equity investments. Affiliate EBITDA, including Celanese Proportional Share of affiliate information on Table 8, is not a recognized term under U.S. GAAP and is not meant to be an alternative to operating cash flow of the 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 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 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. This non-U.S. GAAP information is not intended to be considered in isolation or as a substitute for U.S. GAAP financial information. 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 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 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. This non-U.S. GAAP information is not intended to be considered in isolation or as a substitute for U.S. GAAP financial information. Adjusted free cash flow is defined 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. This non-U.S. GAAP information is not intended to be considered in isolation or as a substitute for U.S. GAAP financial information. 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 1Q 2009 highlights in millions (except EPS) 1st Qtr 2009 1st Qtr 2008 Net Sales $1,146 $1,846 Operating Profit $27 $234 Adjusted EPS $0.08 $1.06 Operating EBITDA $136 $381 1 $32 million inventory accounting impact tax effected at 29% divided by 155.6 million diluted shares for the three months ended March 31, 2009. First Quarter 2009: Strong cash position with positive adjusted free cash flow Inventory accounting impact of ~$0.15/share1 included in Adjusted EPS


 

Peak and trough relative performance Relative Peak versus Trough Quarter - Operating EBIDTA Industrial Specialties Acetyl Intermediates Advanced Engineered Materials Consumer Specialties Other Activities Trough defined as four quarters of sustained -1% to 1% global GDP Note: Earnings from strategic affiliates included in total Operating EBITDA amounts but excluded from margin % amounts Operating EBITDA 18 - 20% 8 - 10% 22 - 25% 18 - 20% 21 - 23% Normalized Trough Conditions 10 - 12% 13 - 15% Seasonality Inventory accounting impacts Customer destocking Impacting Factors Normalized Peak Conditions 20 - 22%


 

Steven Sterin Senior Vice President and CFO


 

Celanese Corporation financial highlights in millions (except EPS) 1st Qtr 2009 1st Qtr 2008 Net Sales $1,146 $1,846 Operating Profit/(Loss) $27 $234 Net Earnings/(Loss) ($20) $145 Other Charges/Adjustments $33 $22 Adjusted EPS $0.08 $1.06 Effective Tax Rate 29% 26% Diluted Share Basis 155.6 167.3 Operating EBITDA $136 $381 1Q 2009 1Q 2009 net sales decreased 38% Lower volumes on weak global demand Lower pricing for acetyl products Operating profit decreased to $27 million Net sales more than offset lower raw material, energy, and spending costs Adjusted EPS fell to $0.08/share Operating EBITDA decreased to $136 million


 

First Quarter 2009: Net sales decreased as higher pricing only partially offset lower volumes Volume decline due to the timing of customer contract negotiations and lower acetate flake sales Operating EBITDA improvement due to the higher pricing, favorable currency and lower spending and energy costs Consumer Specialties in millions 1st Qtr 2009 1st Qtr 2008 Net Sales $266 $282 Operating EBITDA $81 $65 Outlook: Stable volumes expected in 2009 Increased dividend expected in 2Q 2009 from Acetate China affiliates Continued sustained earnings performance with ongoing decreases in spending and energy costs


 

First Quarter 2009: Net sales decrease primarily driven by lower volumes in Europe and North America, as well as the effect of the AT Plastics force majeure Lower raw material and energy costs, along with the benefits of the company's fixed spending reductions, more than offset slightly lower pricing Inventory accounting impacts ($6 million) and lower volumes are the primary reasons for decrease in Operating EBITDA Industrial Specialties in millions 1st Qtr 2009 1st Qtr 2008 Net Sales $242 $365 Operating EBITDA $26 $36 Outlook: Volumes in North America and Europe remain challenged Continued success in Asia help offset volume weakness Raw material and energy cost reductions should positively impact margins


 

in millions 1st Qtr 2009 1st Qtr 2008 Net Sales $165 $294 Operating EBITDA $0 $60 Advanced Engineered Materials First Quarter 2009: Net sales decreased as higher pricing could not offset lower volumes and currency impacts Volume decreases were driven by automotive production in the U.S. and Europe and continued inventory destocking in consumer electronic applications. Operating EBITDA decline was due to lower volumes, inventory accounting impacts ($5 million) and lower affiliate earnings Outlook: Continued volume pressures due to further reductions in US and Europe auto builds Easing raw material and energy costs coupled with sustained pricing should positively impact margins


 

Acetyl Intermediates in millions 1st Qtr 2009 1st Qtr 2008 Net Sales $572 $1,096 Operating EBITDA $48 $246 First Quarter 2009: Decrease in net sales due to substantial volume declines and lower pricing Pricing declined as the industry experienced lower utilization rates on reduced global demand, particularly in Europe and the Americas. Lower raw material and energy costs could not offset lower volumes and inventory accounting impacts ($21 million) Outlook: Volumes expected to be at reduced levels performing at normalized trough profile Margins should be sustained in 2009 due to advantaged technology and cost position


 

1Q 2008 1Q 2009 1Q 2008 1Q 2009 Earnings - Equity Investments 10 -2 Dividends - Cost Investments 28 6 1Q 2009: Earnings impact of $4 million decreased versus prior year due to lower dividends from the company's Ibn Sina cost affiliate and lower earnings from the Advanced Engineered Materials equity affiliates Outlook: Increased dividend year over year expected in 2Q 2009 from Acetate China affiliates Other cost and equity affiliates challenged by weakened global demand environment Income Statement Affiliate Performance Cash Flows


 

Solid cash generation Adjusted Free Cash Flow Adjusted Free Cash Flow Adjusted Free Cash Flow $ in millions 1st Qtr 2009 1st Qtr 2008 Net cash provided by operating activities $199 $166 Adjustments to operating cash for discontinued operations ($1) $1 Net cash provided by operating activities from continuing operations $198 $167 Less: Capital expenditures $56 $81 Less: Other charges and adjustments1 $73 $19 Adjusted Free Cash Flow $69 $67 1Amounts primarily associated with the Kelsterbach relocation and the cash outflows for purchases of other productive assets that are classified as 'investing activities' for U.S. GAAP purposes. Factors contributing to cash generation during first quarter 2009: Lower cash taxes Favorable trade working capital Reduced capital expenditures


 

Celanese capital structure Term Loan - $2.8 billion Other Debt Obligations - $706 million Cash - $1,150 million Net Debt - $2.3 billion Revolver - $650 million Cost Stability Flexibility Structure Characteristics Primary Components Strong balance sheet provides flexibility and stability in current environment Credit Linked Revolver - $143 million Sources of Liquidity Debt Obligations


 

Appendix


 

1Q 2009 Other Charges and Other Adjustments by Segment $ in millions AEM CS IS AI Other Total Employee termination benefits 7 - 2 6 9 24 Ticona Kelsterbach relocation 3 - - - - 3 Clear Lake insurance recoveries - - - (6) - (6) Plumbing insurance recoveries (1) - - - - (1) Asset impairments - - - 1 - 1 Other - - - - - - Total other charges 9 - 2 1 9 21 Business optimization - - 1 - 1 2 Ticona Kelsterbach relocation 1 - - - - 1 Plant closures - - - 4 - 4 Other - - - - 5 5 Total other adjustments 1 - 1 4 7 12 Total other charges and other adjustments 10 - 3 5 15 33


 

Reg G: Reconciliation of Adjusted EPS


 

Reg G: Reconciliation of Net Debt


 

Reg G: Other Charges and Other Adjustments


 

Reg G: Reconciliation of Operating EBITDA


 

Reg G: Equity Affiliate Preliminary Results and Celanese Proportional Share - Unaudited