Celanese Corp (Form: 8-K, Received: 04/22/2021 16:49:37)

UNITED STATES

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 22, 2021

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.)

222 West Las Colinas Blvd. Suite 900N, Irving, TX 75039

(Address of Principal Executive Offices) (Zip Code)

Registrant's telephone number, including area code: (972) 443-4000


N/A

(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):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, par value $0.0001 per share	CE	The New York Stock Exchange
1.125% Senior Notes due 2023	CE /23	The New York Stock Exchange
1.250% Senior Notes due 2025	CE /25	The New York Stock Exchange
2.125% Senior Notes due 2027	CE /27	The New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 7.01 Regulation FD Disclosure

On April 23, 2021, Lori J. Ryerkerk, Chairman of the Board of Directors, Chief Executive Officer and President of Celanese Corporation (the "Company"), will make a presentation to investors and analysts via a webcast hosted by the Company at 10:00 a.m. ET (9:00 a.m. CT) regarding the Company's financial results for its first quarter 2021. The webcast, press release and prepared remarks from management may be accessed on our website at investors.celanese.com under News & Events / Events Calendar. A copy of the prepared remarks posted for the webcast is attached to this Current Report on Form 8-K ("Current Report") as Exhibit 99.1(a) and is incorporated herein solely for purposes of this Item 7.01 disclosure. During the webcast, management may make, and management's prepared remarks contain, references to certain Non-US GAAP financial measures. Non-US GAAP financial measures appearing in management's prepared remarks are defined and reconciled to the most comparable US GAAP financial measure in our Non-US GAAP Financial Measures and Supplemental Information document furnished with this Current Report as Exhibit 99.2 (and available on our website) and is incorporated herein solely for purpose of this Item 7.01 disclosure.

Item 9.01 Financial Statements and Exhibits

(d) The following exhibits are being furnished herewith:


Exhibit Number
						Description

99.1(a)						Prepared Remarks from Management dated April 22, 2021*

99.2						Non-US GAAP Financial Measures and Supplemental Information dated April 22, 2021*

104						Cover Page Interactive Data File (the cover page XBRL tags are embedded within the inline XBRL document contained in Exhibit 101).

* In connection with the disclosure set forth in 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/ MICHAEL R. SULLIVAN
			Name:			Michael R. Sullivan
			Title:			Vice President, Deputy General Counsel and Assistant Corporate Secretary

			Date:			April 22, 2021

Exhibit 99.1(a)

Q1 2021 Earnings Prepared Comments

Brandon Ayache, Celanese Corporation, Senior Director, Investor Relations

This is the Celanese Corporation first quarter 2021 earnings prepared comments. The Celanese Corporation first quarter 2021 earnings release was distributed via Business Wire this afternoon and posted on our investor relations website, investors.celanese.com. As a reminder, some of the matters discussed below may include forward-looking statements concerning, for example, our future objectives and plans. Please note the cautionary language contained at the end of these comments. Also, some of the matters discussed include references to non-GAAP financial measures. Explanations of these measures and reconciliations to the comparable GAAP measures are included on our investor relations website under Financial Information/Non-GAAP Financial Measures. The earnings release and non-GAAP information and the reconciliations are being furnished to the SEC in a Current Report on Form 8-K. These prepared comments are also being furnished to the SEC in a separate Current Report on Form 8-K.

On the earnings conference call tomorrow morning, management will be available to answer questions.

Lori Ryerkerk, Celanese Corporation, Chairman of the Board and Chief Executive Officer

During a very challenging 2020, our teams across the world worked hard to deliver resilient performance and simultaneously position us for recovery this year. As a result of their preparations and continued agility in responding to external factors, I am pleased to report first quarter 2021 adjusted earnings of $3.46 per share, the highest in our history. Our employees again demonstrated the power of our unparalleled optionality amid an unprecedented, worldwide disruption from Winter Storm Uri. We have over 1,300 employees across Texas and virtually all were personally impacted by the storm. I sincerely thank our teams across the globe for their commitment, despite their own personal challenges, to help Celanese navigate the obstacles of the storm in the first quarter and deliver very strong performance.

Leading up to the storm, we made the decision to proactively bring our Texas production facilities down in a controlled manner to ensure the security of our employees, communities, and assets. I commend our manufacturing teams for this decision as these facilities ultimately lost utilities including electricity, natural gas, and potable water as well as critical raw materials. While we still experienced widespread damage due to the prolonged freeze, we avoided any acute failures or damage to our critical equipment.

The impact on petrochemical manufacturing and supply chains in the US Gulf Coast and globally was more significant than anyone could have anticipated. I have been amazed by the actions of our people to dynamically respond to these challenges. Let me share a few examples:

•At our Clear Lake and Bishop facilities we repaired over 1,600 leaks and replaced over 20,000 feet of piping, primarily in our water and steam systems. A total of over 250,000 labor hours was dedicated to make our units operational in just a few weeks.

•We utilized downtime from the storm to not only complete routine maintenance on our facilities, but also accelerated a Clear Lake VAM turnaround planned for the second quarter.

•We navigated sourcing challenges including force majeures, sales allocations, and shipment delays in the first quarter impacting approximately 60 percent of Engineered Materials' global raw material spend. We continue to face significant sourcing challenges, particularly for certain feedstock resins.

•We sourced approximately 40kt of methanol from the market to meet the raw material needs of our Clear Lake and Bishop facilities after restart.

•We secured terminal access and vessels in an extremely tight market and shipped approximately 70kt of Acetyl Chain products from Asia to Europe to supply our downstream production and customers in the first quarter.

•We secured new ways of transporting our raw materials and finished goods to navigate global supply chain disruptions, including:

◦Trans-Siberian rail shipments of acetate flake from our JV partners in Nantong, China to our tow facility in Lanaken, Belgium when water shipment was unavailable.

◦Truck shipment of our emulsions, which passed through customs twice, from our facility in Singapore through Malaysia and to customers in Thailand when water shipment was unavailable.

◦Qualified and sourced a raw material, critical to operating our Ferrara, Italy facility, from South Korea when US supply was disrupted and then coordinated air shipment when the original shipment was stuck in transit in the Suez Canal.

While significant sourcing and supply chain challenges persist, we entered the second quarter with our internal production capabilities across Texas fully restored. Globally, we are producing at near full rates, limited only by some remaining raw material supply constraints. Thanks to our strategy last year to accelerate our major turnarounds, we expect to be able to maintain near full production rates across the second quarter.

The total financial headwind of Winter Storm Uri was approximately $75 million in the first quarter with three-quarters of the impact in the Acetyl Chain. Approximately $40 million of the headwind included fixed overhead, freeze-related repairs, and restart costs which we excluded from our adjusted earnings. The remaining approximately $35 million reflected higher variable costs, including energy and raw material spikes in February, which our teams have worked to mitigate where possible. Despite these challenges, we reported first quarter adjusted EBIT of $482 million, just shy of record quarterly performance in the middle of 2018.

Turning to our individual business performance, the Acetyl Chain delivered record adjusted EBIT of $282 million at a margin of 27 percent in the first quarter. Adjusted EBIT expanded by $95 million sequentially as pricing increases of 23 percent more than offset a volume decline of 7 percent, largely driven by the winter storm. Tightened industry dynamics in the second half of the quarter resulted in sequential pricing expansion across virtually all products and regions, including Chinese acetic acid pricing levels which averaged nearly $900 per ton in March. Fundamental demand for acetyls products remained elevated during the quarter, overshadowing the impacts of Chinese New Year as well as weather-driven seasonality in construction applications.

Amid this strong demand backdrop, Winter Storm Uri had a dramatic impact on the global acetyls supply landscape, taking three of four acetic acid production units in the US offline. By our estimates, this resulted in a reduction in global acetic acid supply of approximately 5 percent for the quarter. As soon as we decided to bring our Texas production offline, our teams immediately ramped up production rates across our global network, including Singapore and Nanjing which have been producing at full rates since. We also began immediately shipping acetic acid and VAM from Asia to our own downstream production and customers in Europe, rather than shipping from the US as is typical. Beyond this, we worked to source significant quantities of acetic acid and VAM from the market to continue to supply our customers as reliably as possible given the circumstances. The incremental cost of these actions in addition to higher energy, raw material, and logistics costs directly associated with Winter Storm Uri presented a nearly $30 million unfavorable impact to our Acetyl Chain adjusted EBIT in the first quarter. Our teams worked to offset those cost headwinds as well as the impact of lost volume following the storm via commercial actions and by leveraging our sourcing and supply chain optionality.

Looking to the second quarter, there remains strong fundamental demand across the globe for acetyls products as well as a desire among customers to rebuild inventory levels. We expect industry utilization in the second quarter to remain extremely tight with strong demand and potentially heavier turnaround activity in China. Many local Chinese producers opted to delay their scheduled first quarter turnarounds in

the tightened market but may not be able to delay them further. However, we may see some previously scheduled second quarter industry turnarounds pushed to the second half of the year. In any case, our Acetyl Chain should be exceptionally well positioned with very minimal turnaround activity required in the second quarter. At this point, our global Acetyl Chain network is at full strength, with the exception of Clear Lake acetic acid which is currently running at approximately 80 percent rates due to limited availability of certain third party raw materials. We expect Clear Lake acetic acid will return to full rates during the second quarter. Inclusive of that limitation, as well as additional Winter Storm Uri costs flowing through inventory, we anticipate record Acetyl Chain adjusted EBIT of approximately $400 million in the second quarter.

Engineered Materials reported first quarter adjusted EBIT of $160 million, a sequential increase of $78 million. Net sales improved by 13 percent from the fourth quarter driven by price and volume expansion of 6 percent each. Demand for our products is strong in all regions and Europe joined the other regions in recovering to pre-COVID levels following a 14 percent sequential increase in tons sold there. Sequential volume expansion was driven by growth in automotive, industrial, and electronics applications as well as modest recovery in medical. Amid this demand backdrop, our commercial teams have done an exceptional job of staying ahead of rapidly increasing raw material costs. You will recall that we took actions starting last quarter to preserve our variable margins despite rapid inflation. In the first quarter, the team more than offset an additional sequential headwind of approximately $20 million in variable costs to deliver expanded adjusted EBIT margin of 25 percent. First quarter adjusted EBIT was consistent with pre-COVID performance in the same period of last year, as our base business grew to largely offset $28 million in lower affiliate earnings year over year.

With the recent headlines surrounding automotive production rates, I want to discuss what we are seeing in this end market. Our automotive business in Engineered Materials delivered record tonnage in the first quarter, 4 percent higher over the prior quarter, driven by strong growth in Europe and continued traction in electric vehicle applications. We have not yet seen any material change in order patterns for our

products from disruptions in auto OEM production due to semiconductor and other raw material shortages. This is largely because OEMs have diverted semiconductors from less profitable platforms to trucks and SUVs which are more profitable for OEMs and where we have greater relative exposure. In other cases, OEMs have continued producing trucks and SUVs without computer chips and parked them for chip installation later. Where OEMs have shut down or curtailed relevant production, we have not yet seen the impact of that really flow through the tiers to reach our order books. So far in April we are only seeing very modest adjustments in order patterns, but we anticipate more unfavorable impact on our automotive order patterns as the quarter progresses.

Looking at the second quarter, we anticipate flat to slightly higher volume sequentially, led by continued demand strength and full availability of our Bishop POM production which was impacted by Winter Storm Uri in the first quarter. We anticipate strong demand across most end markets will be partially offset by expected softening in automotive order patterns as discussed. We also expect resins like nylon and PBT, which we compound and which remain exceptionally tight, will limit volumes in some applications and drive continued raw material cost inflation across the second quarter. Our procurement teams are working to secure these resins while our commercial teams are working to maintain sequential variable margins despite significantly rising costs. Accounting for these various dynamics, we expect Engineered Materials will generate second quarter adjusted EBIT approaching the same level as the first quarter.

Acetate Tow delivered first quarter adjusted EBIT of $61 million at a margin of 51 percent, consistent with performance last quarter. Higher sequential dividends from affiliates offset the impact of lower tow sales in the first quarter due to raw material and vessel availability following Winter Storm Uri. We expect similar adjusted EBIT of approximately $60 million in the second quarter as higher sequential volumes from deferred shipments will offset higher raw material costs due to elevated acetyls pricing.

We finished the first quarter with strength and have progressed into the second quarter with significant momentum. The outlook for the first half of this year has improved meaningfully over the last month as demand across Engineered Materials and the Acetyl Chain remains elevated across most end markets. Our teams have done a tremendous job of successfully keeping pace with quickly rising input costs and in many cases expanding our variable margins. Global utilization across both acetyls and engineering thermoplastics will remain very high as both producers and customers work to rebuild depleted supply chains in all regions. While we are still working through challenges, direct and indirect, from Winter Storm Uri, we have positioned ourselves to create leading value amid a favorable business backdrop in the second quarter. As a result, we expect to deliver second quarter adjusted earnings of approximately $4.00 per share, which would be an all-time record.

At this stage, we have visibility to order patterns into early June, which gives us confidence in our anticipated second quarter performance. Looking beyond that to the second half of the year, it is unclear how quickly the elevated tightness in global acetyls will moderate. That will depend on a number of factors including the scale of global restocking, industry turnaround activity in the second quarter, and the timing of a return to full production rates at our Clear Lake acetic acid unit. While we anticipate meaningful moderation in acetyls pricing levels as the year progresses, we expect Engineered Materials earnings performance to remain resilient through the year. We anticipate potential moderation in elevated industry demand for thermoplastics will be offset by continued recovery in affiliate performance as well as recovery in our medical business. Based off stronger than anticipated performance in the first half and this outlook for the second half, we expect full year adjusted earnings of between $12.50 and $13.50 per share.

As I said at our recent Investor Day, there will be time periods when we see volatility in earnings based on external dynamics. We are seeing bookend examples of this last year and this year. However, there remains an underlying lift in the fundamental earnings profile of Celanese, driving a consistent increase in both our highs and our lows over time. You are seeing that displayed in both our 2020 and 2021

performance. We outlined a series of actions we are taking to further strengthen Celanese’s earning profile including:

•Transforming how we achieve productivity to include greater automation, analytics, and artificial intelligence;

•Driving greater sustainability in our own organization and for our customers through a growing portfolio of sustainable solutions;

•Localizing our production and capabilities in Asia to drive greater growth and more dynamically partner with our customers there;

•Expanding in the Acetyl Chain at Clear Lake acetic acid and downstream products across the globe to improve our cost advantage, scale, and optionality; and

•Scaling our project pipeline model in EM and driving early wins with partners in innovative areas like electric vehicles, medical and pharma, 5G, and sustainability.

In summary, Celanese has tremendous momentum, for 2021 and beyond. We are taking decisive actions to optimize our performance amid the environment we see today while we continue to invest in our ability to deliver growth in fundamental shareholder value over the next several years.

Scott Richardson, Celanese Corporation, Chief Financial Officer

I would like to start by providing additional detail on the difference in GAAP and adjusted earnings per share for the first quarter, namely approximately $40 million in adjustments associated with Winter Storm Uri which is included within Certain Items. Consistent with our practices following past severe weather disruptions, we adjusted our earnings for fixed overhead, freeze-related repairs, and restart costs. The additional approximately $35 million impact from the storm in the first quarter, including unprecedented

spikes in electricity, natural gas, and certain raw materials was not adjusted, and our teams have worked tirelessly to offset much of that headwind. Our teams are also working to mitigate an additional estimated $30 million headwind in the second quarter from Winter Storm Uri, which represents elevated product costs currently in inventory or in transit.

Given the strong performance Lori highlighted for the first half, I would like to discuss our cash generation expectations. In the first quarter, we generated free cash flow of $19 million, largely in line with expectations. This reflected the European Commission settlement of approximately $100 million paid in January as well as a nearly $100 million working capital build associated with sales growth and raw material increases in the quarter.

In the first quarter, we returned a total of $328 million to shareholders via $250 million in share repurchases and $78 million in dividends. Capital expenditures in the quarter totaled $92 million. As of the end of the first quarter, our cash balances and short-term investments stood at approximately $1.1 billion.

So far through April, we are seeing expanded free cash flow generation that is reflective of the robust demand and pricing backdrop that Lori described. We expect this will continue throughout the second quarter. We expect to deploy approximately $250 million to share repurchases in the second quarter, to arrive at approximately $500 million in the first half of the year as previously discussed. Given the strength of our cash generation, we also anticipate an additional $200 to $300 million in share repurchases in the second half of the year. At this stage, we anticipate over $900 million in 2021 free cash flow, which along with cash on the balance sheet, provides us optionality to meaningfully execute both share repurchases and high-return M&A.

Last quarter we discussed the possibility of an increase in the effective tax rate for adjusted earnings. Given the strength of earnings to date in 2021 and the jurisdictional mix of earnings, we have revised our

estimate of the 2021 effective tax rate for adjusted earnings to 14 percent from 13 percent previously. This is reflective of a greater percentage of our anticipated 2021 earnings in higher tax jurisdictions like Asia.

The effective US GAAP tax rate of 21 percent in the first quarter was comparable to the same quarter of last year.

I thank our teams for their efforts amid a challenging first quarter and for a very encouraging start to 2021. This concludes our prepared comments. We look forward to discussing our first quarter results and addressing your questions.

Forward-Looking Statements

These prepared comments may contain "forward-looking statements," which include information concerning the Company's plans, objectives, goals, strategies, future revenues, performance, capital expenditures, financing needs, and other information that is not historical information. All forward-looking statements are based upon current expectations and beliefs and various assumptions. There can be no assurance that the Company will realize these expectations or that these beliefs will prove correct. There are a number of risks and uncertainties that could cause actual results to differ materially from the results expressed or implied in the forward-looking statements contained in these comments. These risks and uncertainties include, among other things: the extent to which the COVID-19 pandemic continues to adversely impact the economic environment, market demand and our operations, as well as the pace of any economic recovery; changes in general economic, business, political and regulatory conditions in the countries or regions in which we operate; the length and depth of product and industry business cycles, particularly in the automotive, electrical, mobility, textiles, medical, electronics and construction industries; changes in the price and availability of raw materials, particularly changes in the demand for, supply of, and market prices of ethylene, methanol, natural gas, wood pulp and fuel oil and the prices for electricity and other energy sources; the ability to pass increases in raw material prices on to customers or otherwise improve margins through price increases; the ability to maintain plant utilization rates and to implement planned capacity additions and expansions as well as facility turnarounds; the ability to reduce or maintain their current levels of production costs and to improve productivity by implementing technological improvements to existing plants; the ability to identify desirable potential acquisition targets and to complete acquisition or investment transactions consistent with the Company's strategy; the ability to identify and execute on other attractive investment opportunities towards which to deploy capital; increased price competition and the introduction of competing products by other companies; market acceptance of our technology; compliance and other costs and potential disruption or interruption of production or operations due to accidents, interruptions in sources of raw materials, cyber security incidents, terrorism or political unrest, public health crises (including, but not limited to, the COVID-19 pandemic); other unforeseen events or delays in construction or operation of facilities, including as a result of geopolitical conditions, the occurrence of acts of war or terrorist incidents or as a result of weather or natural disasters or other crises including public health crises; the ability to obtain governmental approvals and to construct facilities on terms and schedules acceptable to the Company; changes in the degree of intellectual property and other legal protection afforded to our products or technologies, or the theft of such intellectual property; potential liability for remedial actions and increased costs under existing or future environmental, health and safety regulations, including those relating to climate change; potential liability resulting from pending or future litigation, or from changes in the laws, regulations or policies of governments or other governmental activities in the countries in which we operate; changes in currency exchange rates and interest rates; our level of indebtedness, which could diminish our ability to raise additional capital to fund operations or limit our ability to react to changes in the economy or the chemicals industry; tax rates and changes thereto; our ability to obtain regulatory approval for, and satisfy closing conditions to, any transactions described herein; and various other factors discussed from time to time in the Company's filings with the Securities and Exchange Commission.

The extent to which COVID-19 will adversely impact our business, financial condition and results of operations will depend on numerous evolving factors, which are highly uncertain, rapidly changing and cannot be predicted, including: the extent of any resurgence in infections and the spread of the disease, and the effectiveness of any vaccines; additional governmental, business and individual actions to contain the spread of the outbreak, including social distancing, work-at-home, stay-at-home and shelter-in-place orders and shutdowns, travel restrictions and quarantines; the extent to which these conditions depress economic activity generally and demand for our products specifically and affect the financial markets; the effect of the outbreak on our customers, suppliers, supply chain and other business partners; our ability during the outbreak to provide our products and services, including the health and well-being of our employees; business disruptions caused by actual or potential plant, workplace and office closures; the risk that we could be exposed to liability, negative publicity or reputational harm related to any incidents of actual or perceived transmission of COVID-19 among employees at our facilities; the ability of our customers to pay for our products and services during and following the outbreak; the impact of the outbreak on the financial markets and economic activity generally; our ability to access usual sources of liquidity on reasonable terms; and our ability to comply with the financial covenant in our Credit Agreement if a material and prolonged economic downturn results in increased indebtedness or substantially lower EBITDA.

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.

Results Unaudited

The results in this document, 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.

Non-GAAP Financial Measures

These prepared comments, and statements made in connection with these prepared comments, refer to non-GAAP financial measures. For more information on the non-GAAP financial measures used by the Company, including the most directly comparable GAAP financial measure for each non-GAAP financial measures used, including definitions and reconciliations of the differences between such non-GAAP financial measures and the comparable GAAP financial measures, please refer to the Non-US GAAP Financial Measures and Supplemental Information document available on our website, investors.celanese.com, under Financial Information/Financial Document Library.

Exhibit 99.2

Non-US GAAP Financial Measures and Supplemental Information

April 22, 2021

In this document, the terms the "Company," "we" and "our" refer to Celanese Corporation and its subsidiaries on a consolidated basis.

Purpose

The purpose of this document is to provide information of interest to investors, analysts and other parties including supplemental financial information and reconciliations and other information concerning our use of non-US GAAP financial measures. This document is updated quarterly.

Presentation

This document presents the Company's three business segments, Engineered Materials, Acetate Tow and Acetyl Chain.

Use of Non-US GAAP Financial Measures

From time to time, management may publicly disclose certain numerical "non-GAAP financial measures" in the course of our earnings releases, financial presentations, earnings conference calls, investor and analyst meetings and otherwise. For these purposes, the Securities and Exchange Commission ("SEC") defines a "non-GAAP financial measure" as a numerical measure of historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adjustments that effectively exclude amounts, included in the most directly comparable measure calculated and presented in accordance with US GAAP, and vice versa for measures that include amounts, or are subject to adjustments that effectively include amounts, that are excluded from the most directly comparable US GAAP measure so calculated and presented. For these purposes, "GAAP" refers to generally accepted accounting principles in the United States.

Non-GAAP financial measures disclosed by management are provided as additional information to investors, analysts and other parties because the Company believes them to be important supplemental measures for assessing our financial and operating results and as a means to evaluate our financial condition and period-to-period comparisons. These non-GAAP financial measures should be viewed as supplemental to, and should not be considered in isolation or as alternatives to, net earnings (loss), operating profit (loss), operating margin, cash flow from operating activities (together with cash flow from investing and financing activities), earnings per share or any other US GAAP financial measure. These non-GAAP financial measures should be considered within the context of our complete audited and unaudited financial results for the given period, which are available on the Financial Information/Financial Document Library page of our website, investors.celanese.com. The definition and method of calculation of the non-GAAP financial measures used herein may be different from other companies' methods for calculating measures with the same or similar titles. Investors, analysts and other parties should understand how another company calculates such non-GAAP financial measures before comparing the other company's non-GAAP financial measures to any of our own. These non-GAAP financial measures may not be indicative of the historical operating results of the Company nor are they intended to be predictive or projections of future results.

Pursuant to the requirements of SEC Regulation G, whenever we refer to a non-GAAP financial measure, we will also present in this document, in the presentation itself or on a Form 8-K in connection with the presentation on the Financial Information/Financial Document Library page of our website, investors.celanese.com, to the extent practicable, the most directly comparable financial measure calculated and presented in accordance with GAAP, along with a reconciliation of the differences between the non-GAAP financial measure we reference and such comparable GAAP financial measure.

This document includes definitions and reconciliations of non-GAAP financial measures used from time to time by the Company.

Specific Measures Used

This document provides information about the following non-GAAP measures: adjusted EBIT, adjusted EBIT margin, operating EBITDA, operating EBITDA margin, operating profit (loss) attributable to Celanese Corporation, adjusted earnings per share, net debt, free cash flow and return on invested capital (adjusted). The most directly comparable financial measure presented in accordance with US GAAP in our consolidated financial statements for adjusted EBIT and operating EBITDA is net earnings (loss) attributable to Celanese Corporation; for adjusted EBIT margin and operating EBITDA margin is operating margin; for operating profit (loss) attributable to Celanese Corporation is operating profit (loss); for adjusted earnings per share is earnings (loss) from continuing operations attributable to Celanese Corporation per common share-diluted; for net debt

is total debt; for free cash flow is net cash provided by (used in) operations; and for return on invested capital (adjusted) is net earnings (loss) attributable to Celanese Corporation divided by the sum of the average of beginning and end of the year short- and long-term debt and Celanese Corporation stockholders' equity.

Definitions

•Adjusted EBIT is a performance measure used by the Company and is defined by the Company as net earnings (loss) attributable to Celanese Corporation, plus (earnings) loss from discontinued operations, less interest income, plus interest expense, plus refinancing expense and taxes, and further adjusted for Certain Items (refer to Table 8). We believe that adjusted EBIT provides transparent and useful information to management, investors, analysts and other parties in evaluating and assessing our primary operating results from period-to-period after removing the impact of unusual, non-operational or restructuring-related activities that affect comparability. Our management recognizes that adjusted EBIT has inherent limitations because of the excluded items. Adjusted EBIT is one of the measures management uses for planning and budgeting, monitoring and evaluating financial and operating results and as a performance metric in the Company's incentive compensation plan. We do not provide reconciliations for adjusted EBIT on a forward-looking basis (including those contained in this document) when we are unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing and amount of Certain Items, such as mark-to-market pension gains and losses, that have not yet occurred, are out of our control and/or cannot be reasonably predicted. For the same reasons, we are unable to address the probable significance of the unavailable information. Adjusted EBIT margin is defined by the Company as adjusted EBIT divided by net sales. Adjusted EBIT margin has the same uses and limitations as Adjusted EBIT.

•Operating EBITDA is a performance measure used by the Company and is defined by the Company as net earnings (loss) attributable to Celanese Corporation, plus (earnings) loss from discontinued operations, less interest income, plus interest expense, plus refinancing expense, taxes and depreciation and amortization, and further adjusted for Certain Items, which Certain Items include accelerated depreciation and amortization expense. Operating EBITDA is equal to adjusted EBIT plus depreciation and amortization. We believe that Operating EBITDA provides transparent and useful information to investors, analysts and other parties in evaluating our operating performance relative to our peer companies. Operating EBITDA margin is defined by the Company as Operating EBITDA divided by net sales. Operating EBITDA margin has the same uses and limitations as Operating EBITDA.

•Operating profit (loss) attributable to Celanese Corporation is defined by the Company as operating profit (loss), less earnings (loss) attributable to noncontrolling interests ("NCI"). We believe that operating profit (loss) attributable to Celanese Corporation provides transparent and useful information to management, investors, analysts and other parties in evaluating our core operational performance. Operating margin attributable to Celanese Corporation is defined by the Company as operating profit (loss) attributable to Celanese Corporation divided by net sales. Operating margin attributable to Celanese Corporation has the same uses and limitations as Operating profit (loss) attributable to Celanese Corporation.

•Adjusted earnings per share is a performance measure used by the Company and is defined by the Company as earnings (loss) from continuing operations attributable to Celanese Corporation, adjusted for income tax (provision) benefit, Certain Items, and refinancing and related expenses, divided by the number of basic common shares and dilutive restricted stock units and stock options calculated using the treasury method. We believe that adjusted earnings per share provides transparent and useful information to management, investors, analysts and other parties in evaluating and assessing our primary operating results from period-to-period after removing the impact of the above stated items that affect comparability and as a performance metric in the Company's incentive compensation plan. We do not provide reconciliations for adjusted earnings per share on a forward-looking basis (including those contained in this document) when we are unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing and amount of Certain Items, such as mark-to-market pension gains and losses, that have not yet occurred, are out of our control and/or cannot be reasonably predicted. For the same reasons, we are unable to address the probable significance of the unavailable information.

Note: The income tax expense (benefit) on Certain Items ("Non-GAAP adjustments") is determined using the applicable rates in the taxing jurisdictions in which the Non-GAAP adjustments occurred and includes both current and deferred income tax expense (benefit). The income tax rate used for adjusted earnings per share approximates the midpoint in a range of forecasted tax rates for the year. This range may include certain partial or full-year forecasted tax opportunities and related costs, where applicable, and specifically excludes changes in uncertain tax positions, discrete recognition of GAAP items on a quarterly basis, other pre-tax items adjusted out of our GAAP earnings for adjusted earnings per share purposes and changes in management's assessments regarding the ability to realize deferred tax assets for GAAP. In determining the adjusted earnings per share tax rate, we reflect the impact of foreign tax credits when utilized, or expected to be utilized, absent discrete events impacting the timing of foreign tax credit utilization. We analyze this rate quarterly and adjust it 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 from the actual tax rate used for GAAP reporting in any given reporting period. Table 3a summarizes the reconciliation of our estimated GAAP effective tax rate to the adjusted tax rate. The estimated GAAP rate excludes discrete recognition of GAAP items due to our inability to forecast such items. As part of the year-end reconciliation, we will update the reconciliation of the GAAP effective tax rate to the adjusted tax rate for actual results.

•Free cash flow is a liquidity measure used by the Company and is defined by the Company as net cash provided by (used in) operations, less capital expenditures on property, plant and equipment, and adjusted for capital contributions from or distributions to Mitsui & Co., Ltd. ("Mitsui") related to our methanol joint venture, Fairway Methanol LLC ("Fairway"). We believe that free cash flow provides useful information to management, investors, analysts and other parties in evaluating the Company's liquidity and credit quality assessment because it provides an indication of the long-term cash generating ability of our business. Although we use free cash flow as a measure to assess the liquidity generated by our business, the use of free cash flow has important limitations, including that free cash flow does not reflect the cash requirements necessary to service our indebtedness, lease obligations, unconditional purchase obligations or pension and postretirement funding obligations.

•Net debt is defined by the Company as total debt less cash and cash equivalents. We believe that net debt provides useful information to management, investors, analysts and other parties in evaluating changes to the Company's capital structure and credit quality assessment.

•Return on invested capital (adjusted) is defined by the Company as adjusted EBIT, tax effected using the adjusted tax rate, divided by the sum of the average of beginning and end of the year short- and long-term debt and Celanese Corporation stockholders' equity. We believe that return on invested capital (adjusted) provides useful information to management, investors, analysts and other parties in order to assess our income generation from the point of view of our stockholders and creditors who provide us with capital in the form of equity and debt and whether capital invested in the Company yields competitive returns.

Supplemental Information

Supplemental Information we believe to be of interest to investors, analysts and other parties includes the following:

•Net sales for each of our business segments and the percentage increase or decrease in net sales attributable to price, volume, currency and other factors for each of our business segments.

•Cash dividends received from our equity investments.

•For those consolidated ventures in which the Company owns or is exposed to less than 100% of the economics, the outside stockholders' interests are shown as NCI. Beginning in 2014, this includes Fairway for which the Company's ownership percentage is 50%. Amounts referred to as "attributable to Celanese Corporation" are net of any applicable NCI.

Results Unaudited

Table 1

Adjusted EBIT and Operating EBITDA - Reconciliation of Non-GAAP Measures - Unaudited


	Q1 '21	2020	Q4 '20	Q3 '20	Q2 '20	Q1 '20
	(In $ millions)
Net earnings (loss) attributable to Celanese Corporation	322	1,985	1,453	207	107	218
(Earnings) loss from discontinued operations	1	12	—	2	3	7
Interest income	(1)	(6)	(2)	(1)	(1)	(2)
Interest expense	25	109	26	28	27	28

Income tax provision (benefit)	85	247	117	30	35	65
Certain Items attributable to Celanese Corporation (Table 8)	50	(1,216)	(1,294)	24	28	26
Adjusted EBIT	482	1,131	300	290	199	342
Depreciation and amortization expense(1)	88	344	87	88	86	83
Operating EBITDA	570	1,475	387	378	285	425


	Q1 '21	2020	Q4 '20	Q3 '20	Q2 '20	Q1 '20
	(In $ millions)
Engineered Materials	2	5	2	1	—	2
Acetate Tow	—	—	—	—	—	—
Acetyl Chain	—	1	—	—	1	—
Other Activities(2)	—	—	—	—	—	—
Accelerated depreciation and amortization expense	2	6	2	1	1	2
Depreciation and amortization expense(1)	88	344	87	88	86	83
Total depreciation and amortization expense	90	350	89	89	87	85

______________________________

(1)Excludes accelerated depreciation and amortization expense as detailed in the table above, which amounts are included in Certain Items above.

(2)Other Activities includes corporate Selling, general and administrative ("SG&A") expenses, the results of captive insurance companies and certain components of net periodic benefit cost (interest cost, expected return on plan assets and net actuarial gains and losses).


Table 2 - Supplemental Segment Data and Reconciliation of Segment Adjusted EBIT and Operating EBITDA - Non-GAAP Measures - Unaudited


	Q1 '21	2020	Q4 '20			Q3 '20			Q2 '20			Q1 '20
			(In $ millions, except percentages)










Operating Profit (Loss) / Operating Margin
Engineered Materials			130	20.2	%	235	11.3	%	62	10.8	%	84	16.0	%	(13)	(3.1)	%	102	18.1	%
Acetate Tow			16	13.4	%	118	22.7	%	30	22.4	%	30	23.3	%	31	24.4	%	27	20.9	%
Acetyl Chain(1)			251	23.8	%	563	17.9	%	186	20.4	%	121	15.6	%	121	18.3	%	135	16.9	%
Other Activities(2)			(71)			(252)			(75)			(51)			(56)			(70)
Total			326	18.1	%	664	11.7	%	203	12.8	%	184	13.0	%	83	7.0	%	194	13.3	%
Less: Net Earnings (Loss) Attributable to NCI(1)			1			7			1			2			2			2
Operating Profit (Loss) Attributable to Celanese Corporation			325	18.1	%	657	11.6	%	202	12.7	%	182	12.9	%	81	6.8	%	192	13.2	%
Operating Profit (Loss) / Operating Margin Attributable to Celanese Corporation
Engineered Materials			130	20.2	%	235	11.3	%	62	10.8	%	84	16.0	%	(13)	(3.1)	%	102	18.1	%
Acetate Tow			16	13.4	%	118	22.7	%	30	22.4	%	30	23.3	%	31	24.4	%	27	20.9	%




Acetyl Chain(1)			250	23.7	%	556	17.7	%	185	20.3	%	119	15.3	%	119	18.0	%	133	16.6	%
Other Activities(2)			(71)			(252)			(75)			(51)			(56)			(70)
Total			325	18.1	%	657	11.6	%	202	12.7	%	182	12.9	%	81	6.8	%	192	13.2	%
Equity Earnings and Dividend Income, Other Income (Expense) Attributable to Celanese Corporation
Engineered Materials			25			115			15			21			26			53
Acetate Tow			41			126			29			28			32			37



Acetyl Chain			2			5			2			2			—			1
Other Activities(2)			1			19			4			5			5			5
Total			69			265			50			56			63			96
Non-Operating Pension and Other Post-Retirement Employee Benefit (Expense) Income Attributable to Celanese Corporation
Engineered Materials			—			1			1			—			—			—
Acetate Tow			—			—			—			—			—			—



Acetyl Chain			—			—			—			—			—			—
Other Activities(2)			38			16			(67)			28			27			28
Total			38			17			(66)			28			27			28
Gain (Loss) On Sale of Investments in Affiliates
Engineered Materials			—			1,408			1,408			—			—			—
Acetate Tow			—			—			—			—			—			—
Acetyl Chain			—			—			—			—			—			—
Other Activities(2)			—			—			—			—			—			—
Total			—			1,408			1,408			—			—			—
Certain Items Attributable to Celanese Corporation (Table 8)
Engineered Materials			5			(1,356)			(1,404)			11			27			10
Acetate Tow			4			5			—			1			1			3



Acetyl Chain			30			7			—			5			(3)			5
Other Activities(2)			11			128			110			7			3			8
Total			50			(1,216)			(1,294)			24			28			26

___________________________

(1)Net earnings (loss) attributable to NCI is included within the Acetyl Chain segment.

(2)Other Activities includes corporate SG&A expenses, the results of captive insurance companies and certain components of net periodic benefit cost (interest cost, expected return on plan assets and net actuarial gains and losses).


Table 2 - Supplemental Segment Data and Reconciliation of Segment Adjusted EBIT and Operating EBITDA - Non-GAAP Measures - Unaudited (cont.)


	Q1 '21	2020	Q4 '20			Q3 '20			Q2 '20			Q1 '20
			(In $ millions, except percentages)










Adjusted EBIT / Adjusted EBIT Margin
Engineered Materials			160	24.8	%	403	19.4	%	82	14.3	%	116	22.1	%	40	9.5	%	165	29.3	%
Acetate Tow			61	51.3	%	249	48.0	%	59	44.0	%	59	45.7	%	64	50.4	%	67	51.9	%




Acetyl Chain			282	26.7	%	568	18.0	%	187	20.5	%	126	16.2	%	116	17.5	%	139	17.4	%
Other Activities(2)			(21)			(89)			(28)			(11)			(21)			(29)
Total			482	26.8	%	1,131	20.0	%	300	18.9	%	290	20.6	%	199	16.7	%	342	23.4	%
Depreciation and Amortization Expense(1)
Engineered Materials			33			129			32			33			32			32
Acetate Tow			10			36			10			9			9			8



Acetyl Chain			41			162			41			41			41			39
Other Activities(2)			4			17			4			5			4			4
Total			88			344			87			88			86			83
Operating EBITDA / Operating EBITDA Margin
Engineered Materials			193	29.9	%	532	25.6	%	114	19.9	%	149	28.3	%	72	17.1	%	197	35.0	%
Acetate Tow			71	59.7	%	285	54.9	%	69	51.5	%	68	52.7	%	73	57.5	%	75	58.1	%




Acetyl Chain			323	30.6	%	730	23.2	%	228	25.1	%	167	21.5	%	157	23.7	%	178	22.3	%
Other Activities(2)			(17)			(72)			(24)			(6)			(17)			(25)
Total			570	31.7	%	1,475	26.1	%	387	24.3	%	378	26.8	%	285	23.9	%	425	29.1	%

___________________________

(1)Excludes accelerated depreciation and amortization expense, which amounts are included in Certain Items above. See Table 1 for details.

Table 3

Adjusted Earnings (Loss) per Share - Reconciliation of a Non-GAAP Measure - Unaudited


	Q1 '21	2020	Q4 '20		Q3 '20		Q2 '20		Q1 '20
				per share		per share		per share		per share		per share		per share
			(In $ millions, except per share data)
Earnings (loss) from continuing operations attributable to Celanese Corporation			323	2.83	1,997	16.85	1,453	12.50	209	1.76	110	0.93	225	1.88
Income tax provision (benefit)			85		247		117		30		35		65
Earnings (loss) from continuing operations before tax			408		2,244		1,570		239		145		290
Certain Items attributable to Celanese Corporation (Table 8)			50		(1,216)		(1,294)		24		28		26
Refinancing and related expenses			—		—		—		—		—		—
Adjusted earnings (loss) from continuing operations before tax			458		1,028		276		263		173		316
Income tax (provision) benefit on adjusted earnings(1)			(64)		(123)		(33)		(32)		(18)		(41)
Adjusted earnings (loss) from continuing operations(2)			394	3.46	905	7.64	243	2.09	231	1.95	155	1.30	275	2.29
			Diluted shares (in millions)(3)
Weighted average shares outstanding			113.5		117.8		115.7		118.0		118.3		119.3
Incremental shares attributable to equity awards			0.5		0.7		0.6		0.6		0.5		0.6
Total diluted shares			114.0		118.5		116.3		118.6		118.8		119.9

______________________________

(1)Calculated using adjusted effective tax rates (Table 3a) as follows:


	Q1 '21	2020	Q4 '20	Q3 '20	Q2 '20	Q1 '20
			(In percentages)
Adjusted effective tax rate			14	12	12	12	10	13

(2)Excludes the immediate recognition of actuarial gains and losses and the impact of actual vs. expected plan asset returns.


	Actual Plan Asset Returns	Expected Plan Asset Returns
	(In percentages)
2020	12.4	6.5

(3)Potentially dilutive shares are included in the adjusted earnings per share calculation when adjusted earnings are positive.

Table 3a

Adjusted Tax Rate - Reconciliation of a Non-GAAP Measure - Unaudited


	Estimated	Actual
	2021	2020
	(In percentages)
US GAAP annual effective tax rate	17	11
Discrete quarterly recognition of GAAP items(1)	(1)	12
Tax impact of other charges and adjustments(2)	(2)	(9)
Utilization of foreign tax credits	(1)	(3)

Changes in valuation allowances, excluding impact of other charges and adjustments(3)	1	—
Other(4)	—	1
Adjusted tax rate	14	12

______________________________

Note: As part of the year-end reconciliation, we updated the reconciliation of the GAAP effective tax rate for actual results.

(1)Such as changes in tax laws (including US tax reform), deferred taxes on outside basis differences, changes in uncertain tax positions and prior year audit adjustments.

(2)Reflects the tax impact on pre-tax adjustments presented in Certain Items (Table 8), which are excluded from pre-tax income for adjusted earnings per share purposes.

(3)Reflects changes in valuation allowances related to changes in judgment regarding the realizability of deferred tax assets or current year operations, excluding other charges and adjustments.

(4)Tax impacts related to full-year forecasted tax opportunities and related costs.

Table 4

Net Sales by Segment - Unaudited


	Q1 '21	2020	Q4 '20	Q3 '20	Q2 '20	Q1 '20
	(In $ millions)
Engineered Materials	645	2,081	572	526	420	563
Acetate Tow	119	519	134	129	127	129
Acetyl Chain	1,056	3,147	910	776	662	799





Intersegment eliminations(1)	(22)	(92)	(25)	(20)	(16)	(31)
Net sales	1,798	5,655	1,591	1,411	1,193	1,460

___________________________

(1)Includes intersegment sales primarily related to the Acetyl Chain.

Table 4a

Factors Affecting Segment Net Sales Sequentially - Unaudited

Three Months Ended March 31, 2021 Compared to Three Months Ended December 31, 2020


	Volume	Price	Currency	Other	Total
	(In percentages)
Engineered Materials	6	6	1	—	13
Acetate Tow	(10)	(1)	—	—	(11)
Acetyl Chain	(7)	23	—	—	16

Total Company	(3)	15	1	—	13

Three Months Ended December 31, 2020 Compared to Three Months Ended September 30, 2020


	Volume	Price	Currency	Other	Total
	(In percentages)
Engineered Materials	7	—	2	—	9
Acetate Tow	4	(1)	—	—	3
Acetyl Chain	6	10	1	—	17

Total Company	7	5	1	—	13

Three Months Ended September 30, 2020 Compared to Three Months Ended June 30, 2020


	Volume	Price	Currency	Other	Total
	(In percentages)
Engineered Materials	27	(6)	4	—	25
Acetate Tow	1	1	1	—	3
Acetyl Chain	18	(2)	1	—	17

Total Company	20	(3)	2	(1)	18

Three Months Ended June 30, 2020 Compared to Three Months Ended March 31, 2020


	Volume	Price	Currency	Other	Total
	(In percentages)
Engineered Materials	(25)	—	—	—	(25)
Acetate Tow	(3)	1	—	—	(2)
Acetyl Chain	(6)	(11)	—	—	(17)	(1)

Total Company	(13)	(6)	—	1	(18)

Three Months March 31, 2020 Compared to Three Months Ended December 31, 2019


	Volume	Price	Currency	Other	Total
	(In percentages)
Engineered Materials	4	—	—	—	4
Acetate Tow	(9)	(4)	—	—	(13)
Acetyl Chain	5	(1)	—	—	4

Total Company	3	(1)	—	—	2

________________________

(1)2020 includes the effect of the acquisition of the Elotex® brand.

Table 4b

Factors Affecting Segment Net Sales Year Over Year - Unaudited

Three Months Ended March 31, 2021 Compared to Three Months Ended March 31, 2020


	Volume	Price	Currency	Other	Total
	(In percentages)
Engineered Materials	7	2	6	—	15
Acetate Tow	(8)	—	—	—	(8)
Acetyl Chain	5	25	2	—	32

Total Company	5	14	4	—	23

Three Months Ended December 31, 2020 Compared to Three Months Ended December 31, 2019


	Volume	Price	Currency	Other	Total
	(In percentages)
Engineered Materials	6	(4)	4	—	6
Acetate Tow	(7)	(3)	1	—	(9)
Acetyl Chain	19	(3)	2	—	18

Total Company	12	(4)	3	—	11

Three Months Ended September 30, 2020 Compared to Three Months Ended September 30, 2019


	Volume	Price	Currency	Other	Total
	(In percentages)
Engineered Materials	(10)	(3)	2	—	(11)
Acetate Tow	(15)	(3)	—	—	(18)
Acetyl Chain	(1)	(11)	1	—	(11)

Total Company	(6)	(7)	1	1	(11)

Three Months Ended June 30, 2020 Compared to Three Months Ended June 30, 2019


	Volume	Price	Currency	Other	Total
	(In percentages)
Engineered Materials	(27)	(1)	(1)	—	(29)
Acetate Tow	(18)	(5)	—	—	(23)
Acetyl Chain	(14)	(8)	(1)	—	(23)

Total Company	(20)	(5)	(1)	1	(25)

Three Months March 31, 2020 Compared to Three Months Ended March 31, 2019


	Volume	Price	Currency	Other	Total
	(In percentages)
Engineered Materials	(9)	(5)	(1)	—	(15)
Acetate Tow	(17)	(5)	—	—	(22)
Acetyl Chain	(3)	(7)	(1)	1	(10)

Total Company	(7)	(6)	(1)	1	(13)

Table 4c

Factors Affecting Segment Net Sales Year Over Year - Unaudited

Year Ended December 31, 2020 Compared to Year Ended December 31, 2019


	Volume	Price	Currency	Other	Total
	(In percentages)
Engineered Materials	(11)	(3)	1	—	(13)
Acetate Tow	(14)	(4)	—	—	(18)
Acetyl Chain	—	(8)	1	—	(7)

Total Company	(5)	(6)	—	1	(10)

Table 5

Free Cash Flow - Reconciliation of a Non-GAAP Measure - Unaudited


	Q1 '21		2020		Q4 '20		Q3 '20		Q2 '20		Q1 '20
	(In $ millions, except percentages)
Net cash provided by (used in) investing activities	98		592		979		(78)		(181)		(128)
Net cash provided by (used in) financing activities	(371)		(1,471)		(933)		(290)		(232)		(16)

Net cash provided by (used in) operating activities	116		1,343		274		431		379		259
Capital expenditures on property, plant and equipment	(92)		(364)		(85)		(72)		(88)		(119)
Distributions to NCI	(5)		(29)		(8)		(8)		(8)		(5)
Free cash flow(1)(2)	19		950		181		351		283		135

Net sales	1,798		5,655		1,591		1,411		1,193		1,460

Free cash flow as % of Net sales	1.1	%	16.8	%	11.4	%	24.9	%	23.7	%	9.2	%

______________________________

(1)Free cash flow is a liquidity measure used by the Company and is defined by the Company as net cash provided by (used in) operating activities, less capital expenditures on property, plant and equipment, and adjusted for capital contributions or distributions to Mitsui related to our joint venture, Fairway.

(2)Excludes required debt service and finance lease payments of $30 million and $26 million for the years ended December 31, 2021 and 2020, respectively.

Table 6

Cash Dividends Received - Unaudited


	Q1 '21	2020	Q4 '20	Q3 '20	Q2 '20	Q1 '20
	(In $ millions)
Dividends from equity method investments	35	147	36	6	59	46
Dividends from equity investments without readily determinable fair values	42	126	28	29	32	37
Total	77	273	64	35	91	83

Table 7

Net Debt - Reconciliation of a Non-GAAP Measure - Unaudited


	Q1 '21	2020	Q4 '20	Q3 '20	Q2 '20	Q1 '20
	(In $ millions)
Short-term borrowings and current installments of long-term debt - third party and affiliates	497	496	496	958	1,045	749
Long-term debt, net of unamortized deferred financing costs	3,135	3,227	3,227	3,140	2,989	3,356
Total debt	3,632	3,723	3,723	4,098	4,034	4,105
Cash and cash equivalents	(791)	(955)	(955)	(615)	(539)	(570)
Net debt	2,841	2,768	2,768	3,483	3,495	3,535

Table 8

Certain Items - Unaudited

The following Certain Items attributable to Celanese Corporation are included in Net earnings (loss) and are adjustments to non-GAAP measures:


	Q1 '21	2020	Q4 '20	Q3 '20	Q2 '20	Q1 '20	Income Statement Classification
	(In $ millions)
Plant/office closures	(5)	10	7	4	(4)	3	Cost of sales / SG&A / Other (charges) gains, net / Gain (loss) on disposition of businesses and assets, net
Asset impairments	1	31	—	2	25	4	Cost of sales / Other (charges) gains, net
Clear Lake incident	—	4	—	—	—	4	Cost of sales
COVID-19	—	5	2	1	1	1	Cost of sales / SG&A
Mergers, acquisitions and dispositions	—	22	5	7	3	7	Cost of sales / SG&A
Impact from natural disasters	41	—	—	—	—	—	Cost of sales

Actuarial (gain) loss on pension and postretirement plans	—	95	95	—	—	—	Cost of sales / SG&A / Non-operating pension and other postretirement employee benefit (expense) income
Restructuring	3	25	5	11	2	7	SG&A / Other (charges) gains, net / Non-operating pension and other postretirement employee benefit (expense) income
European Commission investigation	—	2	—	—	2	—	Other (charges) gains, net
Commercial disputes	9	(1)	—	—	(1)	—	Cost of sales / SG&A / Other (charges) gains, net
(Gain) loss on sale of investments in affiliates	—	(1,408)	(1,408)	—	—	—	Gain (loss) on sale of investments in affiliates
Other	1	(1)	—	(1)	—	—	SG&A / Gain (loss) on disposition of businesses and assets, net
Certain Items attributable to Celanese Corporation	50	(1,216)	(1,294)	24	28	26

Table 9

Return on Invested Capital (Adjusted) - Presentation of a Non-GAAP Measure - Unaudited


			2020
			(In $ millions, except percentages)
Net earnings (loss) attributable to Celanese Corporation			1,985

Adjusted EBIT (Table 1)			1,131
Adjusted effective tax rate (Table 3a)			12	%
Adjusted EBIT tax effected			995

	2020	2019	Average
	(In $ millions, except percentages)
Short-term borrowings and current installments of long-term debt - third parties and affiliates	496	496	496
Long-term debt, net of unamortized deferred financing costs	3,227	3,409	3,318
Celanese Corporation stockholders' equity	3,526	2,507	3,017
Invested capital			6,831

Return on invested capital (adjusted)			14.6	%

Net earnings (loss) attributable to Celanese Corporation as a percentage of invested capital			29.1	%