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): February 5, 2008
CELANESE CORPORATION
(Exact Name of Registrant as specified in its charter)
         
DELAWARE   001-32410   98-0420726
         
(State or other jurisdiction
of incorporation) 		  (Commission File
Number) 		  (IRS Employer
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 February 5, 2008, Celanese Corporation (the “Company”) issued a press release reporting the financial results for its fourth quarter and full year 2007 and raising its earnings outlook for 2008. 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 February 5, 2008, 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 February 5, 2008*
 
99.2
  Slide Presentation dated February 5, 2008*
 
*   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/ Miguel A. Desdin    
    Name:   Miguel A. Desdin   
    Title:   Vice President and Controller   
 
Date: February 5, 2008

 

Exhibit Index
     
Exhibit Number   Description
 
99.1
  Press Release dated February 5, 2008*
 
99.2
  Slide Presentation dated February 5, 2008*
 
*   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)
     
Corporate News Release
  Celanese Corporation
Investor Relations
1601 West LBJ Freeway
Dallas, Texas 75234-6034
Celanese Corporation Reports Record Fourth Quarter and Full Year Results; Raises Outlook for 2008
      Fourth quarter highlights:
  •   Net sales increased 23% to $1,760 million from prior year
 
  •   Operating profit more than doubled to $324 million
 
  •   Net earnings increased to $214 million from $77 million in prior year
 
  •   Operating EBITDA increased 30% to $349 million
 
  •   Diluted EPS increased to $1.27 from $0.45 in prior year
 
  •   Adjusted EPS increased to $0.93 from $0.61 in prior year
 
  •   2008 adjusted earnings per share outlook raised to between $3.40 and $3.70 from previous guidance of between $3.35 and $3.65
      Full year highlights:
  •   Net sales increased 12% to $6,444 million from prior year
 
  •   Operating profit increased 21% to $748 million
 
  •   Adjusted EPS increased to $3.42 from $2.62
 
  •   Operating EBITDA increased 16% to $1,325 million
                                 
 
    Three Months Ended   Twelve Months Ended
    December 31,   December 31,
(in $ millions, except per share data)   2007   2006   2007   2006
 
Net sales
    1,760       1,430       6,444       5,778  
Operating profit
    324       140       748       620  
Net earnings
    214       77       426       406  
Operating EBITDA 1
    349       269       1,325       1,144  
Diluted EPS — continuing operations
  $ 1.23     $ 0.18     $ 1.96     $ 1.74  
Diluted EPS — Total
  $ 1.27     $ 0.45     $ 2.49     $ 2.36  
Adjusted EPS 1
  $ 0.93     $ 0.61     $ 3.42     $ 2.62  
 
1   Non-U.S. GAAP measures. See reconciliation in tables 1 and 6.
Dallas, February 5, 2008: Celanese Corporation (NYSE: CE) today reported record net sales of $1,760 million, a 23 percent increase from the prior year. Higher pricing on continued strong global demand for Acetyl Intermediates products, positive currency impacts, growth in Asia supported by the company’s new acetic acid unit in Nanjing, China, and sales from the acquired Acetate Products Limited (APL) business drove the increase. Operating profit increased to $324 million from $140 million in the prior year period and included a total of $93 million of certain other adjustments. These adjustments include a $34 million gain on the sale of the company’s facility in Edmonton, Canada, a $31 million gain on resolution of commercial disputes with a vendor, and a $40 million net gain from a partial insurance recovery related to the outage at the company’s Clear Lake, Texas, facility. Excluding the adjustments, the increase in operating profit was driven primarily by expanded margins in Acetyl Intermediates and Industrial Specialties, as well as profitable growth from the Nanjing, China, facility. Net earnings were $214 million compared with $77 million in the prior year period.

 

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Adjusted earnings per share for the fourth quarter were $0.93 compared with $0.61 in the same period last year. The tax rate used for adjusted earnings per share was 28 percent and 25 percent for the fourth quarters of 2007 and 2006, respectively. Operating EBITDA was $349 million in the quarter versus $269 million in the prior year period. Fourth quarter 2007 adjusted earnings per share and operating EBITDA, which exclude the $93 million of other adjustments, reflect record performance for the company.
“Celanese’s integrated business model continued to deliver high quality earnings,” said David Weidman, chairman and chief executive officer. “Our global presence and continued execution of our focused growth strategy drove excellent results in the quarter.”
Full Year 2007 Results
Net sales for 2007 were $6,444 million, a 12 percent increase from 2006, primarily driven by overall higher pricing on continued strong demand, positive currency effects and additional sales from the APL business. Operating profit was $748 million compared with $620 million in the same period last year. Excluding the one-time adjustments in both periods, the underlying increase is driven by growth across all businesses and lower selling, general and administrative expenses related to the company’s operational excellence initiatives. Operating EBITDA for the full year 2007 was $1,325 million compared with $1,144 million in the same period last year. Adjusted earnings per share were $3.42 versus $2.62 in 2006.
Recent Highlights
  •   Reached a definitive agreement with Southwest Research and Design Institute of Chemical Industry, based in China, that will accelerate the company’s research and development efforts in acetyl products.
 
  •   Entered into a long-term supply agreement to secure availability of carbon monoxide (CO) to increase reliability of supply and support future expansion of acetic acid capacity at the company’s Nanjing, China, complex.
 
  •   Began commercial sales from the emulsions unit at the company’s fully integrated chemical complex in Nanjing.
 
  •   Consistent with its growth strategy in China for Advanced Engineered Materials, commissioned startup of its Celstran ® long fiber-reinforced thermoplastic (LFRT) unit in Nanjing, China. Also announced plans to add a polymer compounding unit to the Nanjing complex.
 
  •   Raised 2010 strategic growth objectives by $50 million to between $350 million and $400 million in additional operating EBITDA from its 2006 baseline.
 
  •   Upgraded by Standard & Poor’s with a positive outlook and corporate credit rating of ‘BB’ from ‘BB-.’ The global credit rating agency also raised the company’s senior secured bank loan rating from ‘BB’ to ‘BB+’ and affirmed its ‘2’ recovery rating.
Fourth Quarter Segment Overview
Advanced Engineered Materials
New product applications and strong demand in Europe and the Americas drove continued growth in Advanced Engineered Materials. The businesses, however, experienced ongoing margin pressure due to high raw material and energy costs. Net sales increased to $253 million from $224 million in the same period last year on higher

 

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volumes and positive currency impacts. Operating profit increased to $30 million from $29 million as the volume growth was offset by higher raw material and energy costs and overall lower pricing due to product and application mix. Operating profit includes approximately $10 million in other adjustments, primarily related to an insurance settlement in the period. Operating EBITDA, which excludes the adjustments, decreased to $45 million from $58 million in the prior year period, primarily driven by lower overall earnings from equity affiliates.
Consumer Specialties
Consumer Specialties realized benefits from its European growth initiative as sales and earnings significantly increased from the prior year. Net sales increased to $279 million from $224 million in the same period last year, primarily driven by $62 million of additional net sales from the APL business during the quarter. Higher pricing, driven by continued strong demand, also contributed to the increased sales. The increase was partially offset by lower volumes associated with the company’s strategy to shift flake production to its China ventures. Operating profit increased to $69 million from $41 million in the prior year period and included $27 million of non-recurring benefits, principally from the sale of the Edmonton, Canada, facility and the partial insurance recovery. Incremental operating profit from the APL acquisition, positive impacts from the Acetate Products revitalization, and overall higher pricing on continued strong demand offset higher raw material and energy costs in the period. Operating EBITDA increased to $57 million compared with $53 million in the same period last year. The Nutrinova business continued to deliver stable earnings in the period.
Industrial Specialties
With strong performance and leading global positions, Industrial Specialties delivered improved results in the quarter. Net sales increased to $331 million compared with $309 million in the prior year period. The increase, primarily driven by higher pricing on continued strong demand and positive currency impacts, was partially offset by lower volumes resulting from the residual impact of the company’s unplanned acetic acid outage at its Clear Lake, Texas, facility. Operating profit was $26 million, a $17 million increase from the prior year period, and operating EBITDA was $41 million compared with $25 million in 2006.
Acetyl Intermediates
Acetyl Intermediates’ growth in Asia and continued favorable dynamics drove record performance in the quarter. Net sales were $1,083 million compared with $831 million in the prior year period. The increase is attributed to higher pricing resulting from continued strong demand and industry production outages, increased volumes and positive currency impacts in the period. Increased volumes were primarily driven by production from the company’s new acetic acid unit in Nanjing, China. Operating profit was $276 million compared with $107 million in the same period last year, driven by the higher pricing and increased volumes. Results also included approximately $97 million of one-time gains primarily associated with a resolution of commercial disputes with a vendor, the partial insurance recovery and the sale of the company’s Edmonton, Canada, facility. Operating EBITDA, which excludes the one-time gains, increased to $231 million from $169 million in the same period last year, driven by the higher operating profit and higher dividend income from the company’s Ibn Sina cost affiliate.
Taxes
The tax rate for adjusted earnings per share was 28 percent in the fourth quarter of 2007 compared with 25 percent for the fourth quarter of 2006. The U.S. GAAP effective tax rate for continuing operations for 2007 was

 

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25 percent versus 42 percent in 2006. The U.S. GAAP rate for 2007 is lower primarily due to increased earnings in tax jurisdictions with reduced tax rates and the favorable impact from the recent German tax rate reduction. These benefits are partially offset by the accounting treatment for the recent tax law change in Mexico in the fourth quarter of 2007. Cash taxes for 2007 were $191 million compared with $101 million in 2006, primarily as a result of the timing of cash taxes in Germany. The new tax laws in Mexico are not expected to materially impact cash taxes in future periods.
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, totaled $40 million in the fourth quarter and were flat compared with 2006 results. Higher dividends received from the company’s Ibn Sina cost affiliate offset lower earnings in the Advanced Engineered Materials equity affiliates. Equity and cost investment dividends, which are included in operating cash flow, were $26 million compared with $73 million in the prior year period, primarily due to a special dividend from the company’s Polyplastics equity affiliate received in the fourth quarter of 2006.
Cash Flow
For the full year 2007, the company generated approximately $566 million in cash flow from operations compared with $751 million in 2006. Excluding adjustments to operating cash for discontinued operations in both periods, cash flow from operations was $650 million and $741 million for 2007 and 2006, respectively. Through the end of the fourth quarter 2007, the company paid $191 million in cash taxes, a $90 million increase from the same period in 2006.
“Our strong operational cash generation in 2007 provides a solid platform for future growth and delivering shareholder value,” said Steven Sterin, senior vice president and chief financial officer. “In 2008, we expect adjusted free cash flow of between $500 million and $550 million, driven by strong earnings and lower cash taxes.”
Cash and cash equivalents at the end of the fourth quarter were $825 million, a $34 million increase from the end of 2006 and a $294 million increase from the end of the third quarter of 2007. During the fourth quarter of 2007, the company received $31 million from resolution of commercial disputes with a vendor, cash proceeds of $33 million from the sale of the Edmonton, Canada, facility and a $33 million net insurance recovery progress payment related to the unplanned outage at its Clear Lake, Texas, facility. Net debt at the end of the fourth quarter was $2,731 million, a slight increase from $2,707 million at the end of 2006.
Outlook
Based on continued strength in its global markets and progress in executing its strategic growth plans, the company raised its full year 2008 outlook for adjusted earnings per share to between $3.40 and $3.70 from its previous guidance range of between $3.35 and $3.65. The company’s guidance is based on a tax rate of 26 percent and a year-end weighted average of 169 million diluted shares outstanding. The company also raised its guidance range for operating EBITDA to between $1,290 million and $1,360 million from its previous guidance range of between $1,280 million and $1,350 million.

 

Page 5 of 13

“With our resilient portfolio, geographic reach, and diversified end market exposure, Celanese is well positioned to mitigate the impacts of an uncertain economic environment and deliver sustained earnings growth. In 2008, we expect to build on our track record of execution and drive improved performance across our business,” Weidman said.
     
Contacts:
   
Investor Relations
  Media
Mark Oberle
  Jeremy Neuhart
Phone: +1 972 443 4464
  Phone: +1 972 443 3750
Telefax: +1 972 332 9373
  Telefax: +1 972 443 8519
Email: Mark.Oberle@celanese.com
  Jeremy.Neuhart@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 $6.4 billion in 2007, with approximately 70% 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 8,400 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.
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 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.

 

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  •   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 provide guidance on an adjusted earnings per share basis and are unable to reconcile forecasted adjusted earnings per share to a GAAP financial measure 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.
 
  •   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. 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.

 

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Preliminary Consolidated Statements of Operations — Unaudited
                                   
    Three Months Ended     Twelve Months Ended
    December 31,     December 31,
(in $ millions, except per share data)   2007   2006     2007   2006
       
Net sales
    1,760       1,430         6,444       5,778  
Cost of sales
    (1,348 )     (1,119 )       (4,999 )     (4,469 )
               
Gross profit
    412       311         1,445       1,309  
 
                                 
Selling, general and administrative expenses
    (145 )     (134 )       (516 )     (536 )
Amortization of Intangibles 1
    (19 )     (17 )       (72 )     (66 )
Research and development expenses
    (19 )     (17 )       (73 )     (65 )
Other (charges) gains, net
    60       2         (58 )     (10 )
Foreign exchange gain (loss), net
    2       —         2       (3 )
Gain (loss) on disposition of assets, net
    33       (5 )       20       (9 )
               
Operating profit
    324       140         748       620  
 
                                 
Equity in net earnings of affiliates
    17       23         82       76  
Interest expense
    (66 )     (76 )       (262 )     (293 )
Refinancing expenses
    —       —         (256 )     (1 )
Interest income
    10       11         44       37  
Dividend income — cost investments
    23       17         116       79  
Other income (expense), net
    5       10         (25 )     8  
               
Earnings from continuing operations before tax and minority interests
    313       125         447       526  
 
                                 
Income tax provision
    (104 )     (94 )       (110 )     (222 )
               
Earnings from continuing operations before minority interests
    209       31         337       304  
 
                                 
Minority interests
    (1 )     (1 )       (1 )     (4 )
               
Earnings from continuing operations
    208       30         336       300  
 
                                 
Earnings from discontinued operations:
                                 
Earnings from operation of discontinued operations
    2       45         40       130  
Gain on disposal of discontinued operations
    5       1         52       5  
Income tax benefit (provision)
    (1 )     1         (2 )     (29 )
               
Earnings from discontinued operations
    6       47         90       106  
 
                                 
Net earnings
    214       77         426       406  
       
 
                                 
Cumulative preferred stock dividend
    (3 )     (2 )       (10 )     (10 )
               
Net earnings available to common shareholders
    211       75         416       396  
       
 
                                 
Earnings per common share — basic:
                                 
Continuing operations
  $ 1.35     $ 0.18       $ 2.11     $ 1.83  
Discontinued operations
    0.04       0.29         0.58       0.67  
               
Net earnings available to common shareholders
  $ 1.39     $ 0.47       $ 2.69     $ 2.50  
       
 
                                 
Earnings per common share — diluted:
                                 
Continuing operations
  $ 1.23     $ 0.18       $ 1.96     $ 1.74  
Discontinued operations
    0.04       0.27         0.53       0.62  
               
Net earnings available to common shareholders
  $ 1.27     $ 0.45       $ 2.49     $ 2.36  
       
 
                                 
Weighted average shares — basic
    151.7       158.7         154.5       158.6  
Weighted average shares — diluted
    168.6       172.5         171.2       171.8  
       
 
                                 
1   Customer related intangibles

 

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Preliminary Consolidated Balance Sheets — Unaudited
                 
    December 31,   December 31,
(in $ millions)   2007   2006
 
ASSETS
               
Current assets:
               
Cash and cash equivalents
    825       791  
Restricted cash
    —       46  
Receivables:
               
Trade receivables — third party and affiliates, net
    1,009       1,001  
Other receivables
    437       475  
Inventories
    636       653  
Deferred income taxes
    60       76  
Other assets
    86       69  
     
Total current assets
    3,053       3,111  
 
               
Investments
    814       763  
Property, plant and equipment, net
    2,362       2,155  
Deferred income taxes
    58       22  
Other assets
    518       506  
Goodwill
    866       875  
Intangible assets, net
    425       463  
     
Total assets
    8,096       7,895  
     
 
               
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
Current liabilities:
               
Short-term borrowings and current installments of long-term debt — third party and affiliates
    272       309  
Trade payables — third parties and affiliates
    818       830  
Other current liabilities
    888       780  
Deferred income taxes
    20       18  
Income taxes payable
    23       279  
     
Total current liabilities
    2,021       2,216  
 
               
Long-term debt
    3,284       3,189  
Deferred income taxes
    308       297  
Income taxes payable
    220       —  
Benefit obligations
    696       889  
Other liabilities
    495       443  
Minority interests
    5       74  
Shareholders’ equity:
               
Preferred stock
    —       —  
Common stock
    —       —  
Treasury stock, at cost
    (403 )     —  
Additional paid-in capital
    469       362  
Retained earnings
    799       394  
Accumulated other comprehensive income (loss), net
    202       31  
     
Total shareholders’ equity
    1,067       787  
     
Total liabilities and shareholders’ equity
    8,096       7,895  
 

 

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     Twelve Months Ended
    December 31,     December 31,
(in $ millions)   2007   2006     2007   2006
       
Net Sales
                                 
Advanced Engineered Materials
    253       224         1,030       915  
Consumer Specialties
    279       224         1,111       876  
Industrial Specialties
    331       309         1,346       1,281  
Acetyl Intermediates
    1,083       831         3,615       3,351  
Other Activities 1
    —       6         2       22  
Intersegment eliminations
    (186 )     (164 )       (660 )     (667 )
               
Total
    1,760       1,430         6,444       5,778  
       
 
                                 
Operating Profit (Loss)
                                 
Advanced Engineered Materials
    30       29         133       145  
Consumer Specialties
    69       41         199       165  
Industrial Specialties
    26       9         28       44  
Acetyl Intermediates
    276       107         616       456  
Other Activities 1
    (77 )     (46 )       (228 )     (190 )
               
Total
    324       140         748       620  
       
 
                                 
Equity Earnings and Other Income/(Expense) 2
                                 
Advanced Engineered Materials
    7       13         55       55  
Consumer Specialties
    3       2         40       24  
Industrial Specialties
    —       —         —       (1 )
Acetyl Intermediates
    27       23         78       63  
Other Activities 1
    8       12         —       22  
               
Total
    45       50         173       163  
       
 
                                 
Other Charges and Other Adjustments 3
                                 
Advanced Engineered Materials
    (10 )     (1 )       (5 )     (5 )
Consumer Specialties
    (27 )     —         (16 )     —  
Industrial Specialties
    (1 )     2         32       16  
Acetyl Intermediates
    (97 )     16         (38 )     52  
Other Activities 1
    42       (2 )       140       29  
               
Total
    (93 )     15         113       92  
       
 
                                 
Depreciation and Amortization Expense
                                 
Advanced Engineered Materials
    18       17         69       65  
Consumer Specialties
    12       10         51       39  
Industrial Specialties
    16       14         59       59  
Acetyl Intermediates
    25       23         106       101  
Other Activities 1
    2       —         6       5  
               
Total
    73       64         291       269  
       
 
                                 
Operating EBITDA
                                 
Advanced Engineered Materials
    45       58         252       260  
Consumer Specialties
    57       53         274       228  
Industrial Specialties
    41       25         119       118  
Acetyl Intermediates
    231       169         762       672  
Other Activities 1
    (25 )     (36 )       (82 )     (134 )
               
Total
    349       269         1,325       1,144  
       
 
                                 
1   Other Activities primarily includes corporate selling, general and administrative expenses and the results from captive insurance companies. The 2007 Operating Profit (Loss) and Other Charges and Other Adjustments amounts include deductible associated with insurance recovery
 
2   Includes equity earnings from affiliates, dividends from cost investments and other income/(expense).
 
3   Excludes adjustments to minority interest, net interest, taxes, depreciation, amortization and discontinued operations (See Table 7).

 

Page 10 of 13
Table 2
Factors Affecting Fourth Quarter 2007 Segment Net Sales Compared to Fourth Quarter 2006
                                         
(in percent)   Volume     Price     Currency     Other 1     Total  
 
Advanced Engineered Materials
    8 %     -1 %     6 %     0 %     13 %
Consumer Specialties
    -7 %     3 %     1 %     28 %     25 %
Industrial Specialties
    -3 %     5 %     6 %     -1 %     7 %
Acetyl Intermediates
    12 %     13 %     5 %     0 %     30 %
Total Company
    6 %     9 %     6 %     2 %     23 %
 
Factors Affecting Twelve Months 2007 Segment Net Sales Compared to Twelve Months 2006
                                         
(in percent)   Volume     Price     Currency     Other 1     Total  
 
Advanced Engineered Materials
    9 %     -1 %     5 %     0 %     13 %
Consumer Specialties
    -4 %     4 %     1 %     26 %     27 %
Industrial Specialties
    -1 %     2 %     5 %     -1 %     5 %
Acetyl Intermediates
    -5 %     9 %     4 %     0 %     8 %
Total Company
    -2 %     6 %     4 %     4 %     12 %
 
1   Primarily represents net sales from APL (Acetate), divestiture of AT Plastics Films business and captive insurance companies (Total Company).
Table 3
Cash Flow Information
                 
    Twelve Months Ended
    December 31,
(in $ millions)   2007   2006
 
Net cash provided by operating activities
    566       751  
Net cash provided by (used in) investing activities
    143       (268 )
Net cash used in financing activities
    (714 )     (108 )
Exchange rate effects on cash
    39       26  
Cash and cash equivalents at beginning of period
    791       390  
 
Cash and cash equivalents at end of period
    825       791  
 
Table 4
Cash Dividends Received
                                   
    Three Months Ended     Twelve Months Ended
    December 31,     December 31,
(in $ millions)   2007   2006     2007   2006
       
Dividends from equity investments
    3       56         57       109  
Dividends from cost investments
    23       17         116       79  
       
Total
    26       73         173       188  
       
Table 5
Net Debt — Reconciliation of a Non-U.S. GAAP Measure
                 
    December 31,   December 31,
(in $ millions)   2007   2006
 
Short-term borrowings and current installments of long-term debt — third party and affiliates
    272       309  
Long-term debt
    3,284       3,189  
         
Total debt
    3,556       3,498  
Less: Cash and cash equivalents
    825       791  
         
Net Debt
    2,731       2,707  
 

 

 

Page 11 of 13
Table 6
Adjusted Earnings Per Share — Reconciliation of a Non-U.S. GAAP Measure
                                   
    Three Months Ended     Twelve Months Ended
    December 31,     December 31,
(in $ millions, except per share data)   2007   2006     2007   2006
       
Earnings from continuing operations before tax and minority interests
    313       125         447       526  
Non-GAAP Adjustments:
                                 
Other charges and other adjustments 1
    (93 )     15         113       92  
Refinancing costs
    —       —         254       —  
                           
Adjusted earnings from continuing operations before tax and minority interests
    220       140         814       618  
Income tax provision on adjusted earnings 2
    (62 )     (35 )       (228 )     (163 )
Minority interests
    (1 )     (1 )       (1 )     (4 )
                           
Adjusted earnings from continuing operations
    157       104         585       451  
Preferred dividends
    (3 )     (2 )       (10 )     (10 )
                           
Adjusted net earnings available to common shareholders
    154       102         575       441  
Add back: Preferred dividends
    3       2         10       10  
                           
Adjusted net earnings for adjusted EPS
    157       104         585       451  
       
                                   
Diluted shares (millions)                                  
                           
Weighted average shares outstanding
    151.7       158.7         154.5       158.6  
Assumed conversion of Preferred Shares
    12.0       12.0         12.0       12.0  
Assumed conversion of Restricted Stock
    0.6       —         0.4       —  
Assumed conversion of stock options
    4.3       1.8         4.3       1.2  
                           
Total diluted shares
    168.6       172.5         171.2       171.8  
       
Adjusted EPS
    0.93       0.61         3.42       2.62  
       
1   See Table 7 for details
 
2   The adjusted tax rate for the three and twelve months ended December 31, 2007 is 28% based on the original full year 2007 guidance.

 

 

Page 12 of 13
Table 7
Reconciliation of Other Charges and Other Adjustments
Other Charges:
                                   
    Three Months Ended     Twelve Months Ended
    December 31,     December 31,
(in $ millions)   2007   2006     2007   2006
       
Employee termination benefits
    5       1         32       12  
Plant/office closures
    7       (1 )       11       (1 )
Insurance recoveries associated with plumbing cases
    (2 )     (2 )       (4 )     (5 )
Insurance recoveries associated with Clear Lake, Texas
    (40 )     —         (40 )     —  
Resolution of commercial disputes with a vendor
    (31 )     —         (31 )     —  
Deferred compensation triggered by Exit Event
    —       —         74       —  
Asset impairments
    —       —         9       —  
Ticona Kelsterbach plant relocation
    1       —         5       —  
Other
    —       —         2       4  
               
Total
    (60 )     (2 )       58       10  
       
Other Adjustments: 1
                                   
    Three Months Ended     Twelve Months Ended
    December 31,     December 31,
(in $ millions)   2007   2006     2007   2006
       
Executive severance & other costs related to Squeeze-Out
    —       2         —       30  
Ethylene pipeline exit costs
    —       —         10       —  
Business optimization
    8       8         18       12  
Foreign exchange loss related to refinancing transaction
    —       —         22       —  
Loss on AT Plastics films sale
    —       —         7       —  
Discontinued methanol production 2
    —       16         31       52  
Gain on disposal of investment (Pemeas)
    —       (11 )       —       (11 )
Gain on Edmonton sale
    (34 )     —         (34 )     —  
Other
    (7 )     2         1       (1 )
               
Total
    (33 )     17         55       82  
       
 
                                 
Total other charges and other adjustments
    (93 )     15         113       92  
       
1   These items are included in net earnings but not included in other charges.
 
2   Adjusted earnings per share included earnings from its discontinued methanol production which was included in the company’s 2007 guidance.

 

 

Page 13 of 13
Table 8
Equity Affiliate Preliminary Results — Total — Unaudited
                                 
    Three Months Ended   Twelve Months Ended
(in $ millions)   December 31,   December 31,
    2007   2006   2007   2006
 
Net Sales
                               
Ticona Affiliates 1
    336       310       1,270       1,172  
Infraserv 2
    623       381       1,798       1,391  
 
Total
    959       691       3,068       2,563  
 
 
                               
Operating Profit
                               
Ticona Affiliates
    40       41       188       171  
Infraserv
    26       13       87       60  
 
Total
    66       54       275       231  
 
 
                               
Depreciation and Amortization
                               
Ticona Affiliates
    17       16       56       51  
Infraserv
    26       22       87       81  
 
Total
    43       38       143       132  
 
 
                               
Affiliate EBITDA 3
                               
Ticona Affiliates
    57       57       244       222  
Infraserv
    52       35       174       141  
 
Total
    109       92       418       363  
 
 
                               
Net Income
                               
Ticona Affiliates
    21       27       119       112  
Infraserv
    20       15       79       53  
 
Total
    41       42       198       165  
 
 
                               
Net Debt
                               
Ticona Affiliates
    208       25       208       25  
Infraserv
    39       25       39       25  
 
Total
    247       50       247       50  
 
Equity Affiliate Preliminary Results — Celanese Proportional Share — Unaudited 4
                                 
    Three Months Ended   Twelve Months Ended
(in $ millions)   December 31,   December 31,
    2007   2006   2007   2006
 
Net Sales
                               
Ticona Affiliates
    155       143       587       542  
Infraserv
    199       124       587       518  
 
Total
    354       267       1,174       1,060  
 
 
                               
Operating Profit
                               
Ticona Affiliates
    19       19       89       81  
Infraserv
    9       5       29       21  
 
Total
    28       24       118       102  
 
 
                               
Depreciation and Amortization
                               
Ticona Affiliates
    8       7       26       24  
Infraserv
    11       6       31       25  
 
Total
    19       13       57       49  
 
 
                               
Affiliate EBITDA 3
                               
Ticona Affiliates
    27       26       115       104  
Infraserv
    20       11       59       45  
 
Total
    47       37       174       149  
 
 
                               
Equity in net earnings of affiliates (as reported on the Income Statement)
                               
Ticona Affiliates
    9       13       56       52  
Infraserv
    7       7       25       21  
Other 5
    1       3       1       3  
 
Total
    17       23       82       76  
 
 
                               
Affiliate EBITDA in excess of Equity in net earnings of affiliates 6
                               
Ticona Affiliates
    18       13       59       52  
Infraserv
    13       4       34       24  
 
Total
    31       17       93       76  
 
 
                               
Net Debt
                               
Ticona Affiliates
    96       11       96       11  
Infraserv
    15       11       15       11  
 
Total
    111       22       111       22  
 
1   Ticona Affiliates includes PolyPlastics (45% ownership), Korean Engineering Plastics (50%) and Fortron Industries(50%)
 
2   Infraserv includes Infraserv Entities valued as equity investments (Infraserv Höchst Group — 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   This represents liquidating dividends from Clear Lake Methanol Patrners .
 
6   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 4Q 2007 Earnings Conference Call / Webcast Tuesday, February 5, 2008 10:00 a.m. ET 1

 

Forward Looking Statements, Reconciliation and Use of Non- GAAP Measures to U.S. GAAP 2 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. The re are a number of risks and uncertainties that could cause actual results to differ materially from the forward - looking statements contained in this presentation . 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 i s 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. Reconcili ation 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 f inancial measure presented in accordance with U.S. GAAP in our consolidated financial statements for operating EBITDA is operating profit; for affi li ate EBITDA is equity in net earnings of affiliates ; for adjusted earnings per share is earning s per common share - diluted; for net debt is total debt ; and for adjusted fr ee 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 affi liates, other income and depreciation and amortization, and further adjusted for other charges and adjustments . We 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. Be cause 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 man agement'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 managemen t 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 informa tion on Tabl e 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 investme nts 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 manageme nt to measure performance. It is defined as net earnings (loss) available to common shareholders plus preferre d 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 provide guidance on an adjusted earnings per share basis and are unable to reconcile forecasted adjusted earnings per share to a GAAP financial measure because a forecast of Other Items is not practical. We believe t hat 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. § 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 ca pital structure. Our management and credit analysts use net debt to evaluate the c ompany'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 financia l 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. 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.

 

Dave Weidman Chairman and Chief Executive Officer 3

 

Celanese Corporation 4Q and Full Year 2007 Highlights in millions (except EPS) 4th Qtr 2007 4th Qtr 2006 FY 2007 FY 2006 Net Sales $1,760 $1,430 $6,444 $5,778 Operating Profit $324 $140 $748 $620 Adjusted EPS $0.93 $0.61 $3.42 $2.62 Operating EBITDA $349 $269 $1,325 $1,144 Note: All figures exclude results of the divested Oxo Alcohol business. The results of the discontinued Edmonton Methanol business have only been excluded from Net Sales and Operating Profit. FY 2007 net sales increased 12% Improved pricing and favorable currency effects more than offset volume losses related to Clear Lake outage Operating profit up 21% to $748 million Adjusted EPS up 31% to $3.42/share Operating EBITDA increased 16% to $1,325 Additional sales and earnings contributed by acquisition of APL Discontinued Methanol production contributed $0.13 per share and $31 million in Operating EBITDA in the year 4Q 2007 FY 2007 4Q net sales increased 23% Higher pricing on continued strong demand for Acetyl Intermediates and Consumer and Industrial Specialties Continued volume increases in Advanced Engineered Materials Favorable currency impacts Operating profit more than doubled to $324 million Adjusted EPS up 52% to $0.93/share Operating EBITDA increased to $349 4

 

2008 Business Outlook Continued strong global demand Incremental acetic acid volume associated with China expansion VAM and acetic anhydride production scheduled to begin in Nanjing Prices expected to adjust in 2008 Acetyl Intermediates Volume growth >2x GDP across both transportation and non-transportation applications Continued high energy and raw material costs expected to pressure margins Significant progress expected in Nanjing production capabilities Advanced Engineered Materials Synergy capture from APL integration Strong underlying business fundamentals Consumer Specialties High raw material costs continue Realize benefits from revitalization efforts Industrial Specialties 2008 Guidance: Adjusted EPS $3.40 to $3.70 Operating EBITDA $1,290 to $1,360 million Forecasted 2008 adjusted tax rate of 26% 5

 

Committed to Delivering Value Creation $350 - $400 million increased EBITDA profile plus EPS potential by 2010 Group Asia Revitalization Innovation Organic Balance Sheet Operational Excellence EBITDA Impact Consumer and Industrial Specialties X X X X >$100MM Advanced Engineered Materials X X X X >$100MM Acetyl Intermediates X X X >$100MM Celanese Corporate X X Incremental EPS Primary Growth Focus Operating EBITDA EPS 6

 

Steven Sterin Senior Vice President and CFO 7

 

Celanese Corporation Financial Highlights in millions (except EPS) 4th Qtr 2007 4th Qtr 2006 FY 2007 FY 2006 Net Sales $1,760 $1,430 $6,444 $5,778 Operating Profit $324 $140 $748 $620 Net Earnings $214 $77 $426 $406 Special Items Other Charges/Adjustments ($93) $15 $113 $92 Adjusted EPS $0.93 $0.61 $3.42 $2.62 Effective Tax Rate 28% 25% 28% 26% Diluted Share Basis 168.6 172.5 171.2 171.8 Operating EBITDA $349 $269 $1,325 $1,144 8

 

in millions 4th Qtr 2007 4th Qtr 2006 FY 2007 FY 2006 Net Sales $253 $224 $1,030 $915 Operating EBITDA $45 $58 $252 $260 Advanced Engineered Materials Fourth Quarter 2007: Net sales increase driven primarily by strong volume growth (8%) and positive currency effects (6%) Higher raw material and energy costs and lower pricing due to product mix more than offset volume growth Overall lower earnings from equity affiliates and continued high input cost pressures drove decreased Operating EBITDA 9

 

Fourth Quarter 2007: Increase in net sales for the quarter primarily the result of $62 million contribution from APL Operating EBITDA improvement driven by higher overall volumes and pricing as well as incremental earnings from APL Consumer Specialties in millions 4th Qtr 2007 4th Qtr 2006 FY 2007 FY 2006 Net Sales $279 $224 $1,111 $876 Operating EBITDA $57 $53 $274 $228 10

 

Fourth Quarter 2007: Increase in net sales primarily driven by favorable pricing and currency effects Higher pricing on strong demand offset raw material cost pressures contributing to improved Operating EBITDA for the quarter Industrial Specialties in millions 4th Qtr 2007 4th Qtr 2006 FY 2007 FY 2006 Net Sales $331 $309 $1,346 $1,281 Operating EBITDA $41 $25 $119 $118 11

 

Acetyl Intermediates in millions 4th Qtr 2007 4th Qtr 2006 FY 2007 FY 2006 Net Sales $1,083 $831 $3,615 $3,351 Operating EBITDA $231 $169 $762 $672 Fourth Quarter 2007: Higher pricing, additional volumes from Nanjing unit and favorable currency effects drove record sales Favorable supply/demand economics, industry production outages and strong demand sustained higher pricing for acetic acid and VAM Operating EBITDA includes increased dividends from the Ibn Sina cost affiliate 12

 

4Q 2006 4Q 2007 FY 2006 FY 2007 4Q 2006 4Q 2007 FY 2006 FY 2007 Earnings - Equity Investments 23 17 76 82 Dividends - Cost Investments 17 23 79 116 4Q 2007: Earnings impact relatively flat for the period; Decreased cash flows due to special dividend from Polyplastics in 4Q 2006 FY 2007: Increased earnings driven primarily by higher cost dividends from China Acetate ventures and Ibn Sina affiliate Operating EBITDA of $1,325 excludes ~$93 million of proportional Affiliate EBITDA FY 2008: Affiliate earnings1 expected to be between $175 - $185 million Income Statement Cash Flow Affiliates Continue to Deliver Value 1Cost dividends and equity earnings. Note: All figures exclude results of the divested Oxo Alcohol business. 13

 

Continued Strong Cash Generation Adjusted Free Cash Flow Adjusted Free Cash Flow Adjusted Free Cash Flow in millions FY 2007 FY 2006 Net cash provided by operating activities $566 $751 Adjustments to operating cash for discontinued operations $84 ($10) Net cash provided by operating activities from continuing operations $650 $741 Less: Capital expenditures $288 $244 Add: Other charges and other adjustments1 $23 ($41) Adjusted Free Cash Flow $385 $456 Factors contributing to strong cash generation during 2007: Strong operating performance Continued commitment and increased investment in Asia 2007 cash flows from operations included ~$90 million in additional cash taxes 1Amounts primarily associated with the long-term management compensation plan payment in 2007 and the cash outflows for purchases of other productive assets that are classified as 'investing activities' for U.S. GAAP purposes. 14

 

2008 Guidance Affiliate Income1 $175 - $185 million Net Interest2 $200 - $210 million Depreciation and Amortization $300 - $310 million Share Count 169 million Estimated Adjusted Tax Rate for Adjusted EPS 26% Cash Taxes $100 - $120 million Capital Expenditure $280 - $300 million 2008 Updated Guidance 2008 Updated Guidance 2008 Updated Guidance Adjusted EPS Operating EBITDA ($MM) Current $3.40 - $3.70 $1,290 - $1,360 Previous $3.35 - $3.65 $1,280 - $1,350 1Cost dividends and equity earnings. 2Net cash interest and interest expense. 15

 

Appendix 16

 

4Q 2007 Other Charges and Other Adjustments by Segment in millions AEM CS IS AI Other Total Employee termination benefits - - $1 $4 - $5 Plant/office closures - - $2 $5 - $7 Insurance recoveries associated with plumbing cases ($2) - - - - ($2) Insurance recoveries associated with Clear Lake - ($5) ($7) ($63) $35 ($40) Resolution of commercial disputes - - - ($31) - ($31) Ticona Kelsterbach relocation $1 - - - - $1 Other - $1 $1 ($2) - - Total other charges ($1) ($4) ($3) ($87) $35 ($60) Business optimization $1 - - - $7 $8 Edmonton sale - ($22) - ($12) - ($34) Other ($10) ($1) $2 $2 - ($7) Total other adjustments ($9) ($23) $2 ($10) $7 ($33) Total other charges and other adjustments ($10) ($27) ($1) ($97) $42 ($93) 17

 

Reg G: Reconciliation of Adjusted EPS 18 (in $ millions, except per share data) 2007 2006 2007 2006 Earnings from continuing operations before tax and minority interests 313 125 447 526 Non-GAAP Adjustments: Other charges and other adjustments 1 (93) 15 113 92 Refinancing costs - - 254 - Adjusted earnings from continuing operations before tax and minority interests 220 140 814 618 Income tax provision on adjusted earnings 2 (62) (35) (228) (163) Minority interests (1) (1) (1) (4) Adjusted earnings from continuing operations 157 104 585 451 Preferred dividends (3) (2) (10) (10) Adjusted net earnings available to common shareholders 154 102 575 441 Add back: Preferred dividends 3 2 10 10 Adjusted net earnings for adjusted EPS 157 104 585 451 Diluted shares (millions) Weighted average shares outstanding 151.7 158.7 154.5 158.6 Assumed conversion of Preferred Shares 12.0 12.0 12.0 12.0 Assumed conversion of Restricted Stock 0.6 - 0.4 - Assumed conversion of stock options 4.3 1.8 4.3 1.2 Total diluted shares 168.6 172.5 171.2 171.8 Adjusted EPS 0.93 0.61 3.42 2.62 1 See Table 7 for details 2 The adjusted tax rate for the three and twelve months ended December 31, 2007 is 28% based on the original full year 2007 guidance. Twelve Months Ended December 31, Three Months Ended December 31, Adjusted Earnings Per Share - Reconciliation of a Non-U.S. GAAP Measure

 

Reg G: Reconciliation of Net Debt 19 Net Debt - Reconciliation of a Non-U.S. GAAP Measure December 31, December 31, (in $ millions) 2007 2006 Short-term borrowings and current installments of long-term debt - third party and affiliates 272 309 Long-term debt 3,284 3,189 Total debt 3,556 3,498 Less: Cash and cash equivalents 825 791 Net Debt 2,731 2,707 Net Debt - Reconciliation of a Non-U.S. GAAP Measure

 

Reg G: Other Charges and Other Adjustments 20 Other Charges: (in $ millions) 2007 2006 2007 2006 Employee termination benefits 5 1 32 12 Plant/office closures 7 (1) 11 (1) Insurance recoveries associated with plumbing cases (2) (2) (4) (5) Insurance recoveries associated with Clear Lake, Texas (40) - (40) - Resolution of commercial disputes with a vendor (31) - (31) - Deferred compensation triggered by Exit Event - - 74 - Asset impairments - - 9 - Ticona Kelsterbach plant relocation 1 - 5 - Other - - 2 4 Total (60) (2) 58 10 Other Adjustments: 1 (in $ millions) 2007 2006 2007 2006 Executive severance & other costs related to Squeeze-Out - 2 - 30 Ethylene pipeline exit costs - - 10 - Business optimization 8 8 18 12 Foreign exchange loss related to refinancing transaction - - 22 - Loss on AT Plastics films sale - - 7 - Discontinued methanol production 2 - 16 31 52 Gain on disposal of investment (Pemeas) - (11) - (11) Gain on Edmonton sale (34) - (34) - Other (7) 2 1 (1) Total (33) 17 55 82 Total other charges and other adjustments (93) 15 113 92 1 These items are included in net earnings but not included in other charges. 2 Adjusted earnings per share included earnings from its discontinued methanol production which was included in the company's 2007 guidance. December 31, December 31, Three Months Ended Twelve Months Ended Three Months Ended Twelve Months Ended December 31, December 31, Other Charges and Other Adjustments

 

Reg G: Reconciliation of Operating EBITDA 21 Segment Data and Reconciliation of Operating Profit (Loss) to Operating EBITDA - a Non-U.S. GAAP Measure (in $ millions) 2007 2006 2007 2006 Net Sales Advanced Engineered Materials 253 224 1,030 915 Consumer Specialties 279 224 1,111 876 Industrial Specialties 331 309 1,346 1,281 Acetyl Intermediates 1,083 831 3,615 3,351 Other Activities 1 - 6 2 22 Intersegment eliminations (186) (164) (660) (667) Total 1,760 1,430 6,444 5,778 Operating Profit (Loss) Advanced Engineered Materials 30 29 133 145 Consumer Specialties 69 41 199 165 Industrial Specialties 26 9 28 44 Acetyl Intermediates 276 107 616 456 Other Activities 1 (77) (46) (228) (190) Total 324 140 748 620 Equity Earnings and Other Income/(Expense) 2 Advanced Engineered Materials 7 13 55 55 Consumer Specialties 3 2 40 24 Industrial Specialties - - - (1) Acetyl Intermediates 27 23 78 63 Other Activities 1 8 12 - 22 Total 45 50 173 163 Other Charges and Other Adjustments 3 Advanced Engineered Materials (10) (1) (5) (5) Consumer Specialties (27) - (16) - Industrial Specialties (1) 2 32 16 Acetyl Intermediates (97) 16 (38) 52 Other Activities 1 42 (2) 140 29 Total (93) 15 113 92 Depreciation and Amortization Expense Advanced Engineered Materials 18 17 69 65 Consumer Specialties 12 10 51 39 Industrial Specialties 16 14 59 59 Acetyl Intermediates 25 23 106 101 Other Activities 1 2 - 6 5 Total 73 64 291 269 Operating EBITDA Advanced Engineered Materials 45 58 252 260 Consumer Specialties 57 53 274 228 Industrial Specialties 41 25 119 118 Acetyl Intermediates 231 169 762 672 Other Activities 1 (25) (36) (82) (134) Total 349 269 1,325 1,144 1 Other Activities primarily includes corporate selling, general and administrative expenses and the results from captive insurance companies. The 2007 Operating Profit (Loss) and Other Charges and Other Adjustments amounts include deductible associated with insurance recovery. 2 Includes equity earnings from affiliates, dividends from cost investments and other income/(expense). 3 Excludes adjustments to minority interest, net interest, taxes, depreciation, amortization and discontinued operations (See Table 7). Three Months Ended December 31, Twelve Months Ended December 31,

 

Reg G: Equity Affiliate Preliminary Results and Celanese Proportional Share - Unaudited 22 1 Ticona Affiliates includes PolyPlastics (45% ownership), Korean Engineering Plastics (50%) and Fortron Industries(50%) 2 Infraserv includes Infraserv Entities valued as equity investments (Infraserv Hochst Group - 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 This represents liquidating dividends from Clear Lake Methanol Patrners . 6 Product of Celanese proportion of Affiliate EBITDA less Equity in net earnings of affiliates; not included in Celanese operating EBITDA Equity Affiliate Preliminary Results - Total - Unaudited (in $ millions) 2007 2006 2007 2006 Net Sales Ticona Affiliates 1 336 310 1,270 1,172 Infraserv 2 623 381 1,798 1,391 Total 959 691 3,068 2,563 Operating Profit Ticona Affiliates 40 41 188 171 Infraserv 26 13 87 60 Total 66 54 275 231 Depreciation and Amortization Ticona Affiliates 17 16 56 51 Infraserv 26 22 87 81 Total 43 38 143 132 Affiliate EBITDA 3 Ticona Affiliates 57 57 244 222 Infraserv 52 35 174 141 Total 109 92 418 363 Net Income Ticona Affiliates 21 27 119 112 Infraserv 20 15 79 53 Total 41 42 198 165 Net Debt Ticona Affiliates 208 25 208 25 Infraserv 39 25 39 25 Total 247 50 247 50 Three Months Ended December 31, Twelve Months Ended December 31, Equity Affiliate Preliminary Results - Celanese Proportional Share - Unaudited 4 (in $ millions) 2007 2006 2007 2006 Net Sales Ticona Affiliates 155 143 587 542 Infraserv 199 124 587 518 Total 354 267 1,174 1,060 Operating Profit Ticona Affiliates 19 19 89 81 Infraserv 9 5 29 21 Total 28 24 118 102 Depreciation and Amortization Ticona Affiliates 8 7 26 24 Infraserv 11 6 31 25 Total 19 13 57 49 Affiliate EBITDA 3 Ticona Affiliates 27 26 115 104 Infraserv 20 11 59 45 Total 47 37 174 149 Equity in net earnings of affiliates (as reported on the Income Statement) Ticona Affiliates 9 13 56 52 Infraserv 7 7 25 21 Other 5 1 3 1 3 Total 17 23 82 76 Affiliate EBITDA in excess of Equity in net earnings of affiliates 6 Ticona Affiliates 18 13 59 52 Infraserv 13 4 34 24 Total 31 17 93 76 Net Debt Ticona Affiliates 96 11 96 11 Infraserv 15 11 15 11 Total 111 22 111 22 Three Months Ended Twelve Months Ended December 31, December 31,