0001125282-05-001019 8-K 9 20050228 7.01 9.01 20050301 20050301 Celanese CORP 0001306830 2810 980420726 DE 1231 8-K 34 001-32410 05650058 1601 W. LBJ FREEWAY DALLAS TX 75234 972-443-4000 1601 W. LBJ FREEWAY DALLAS TX 75234 Blackstone Crystal Holdings Capital Partners (Cayman) IV Ltd. 20041022 8-K 1 b405062_8k.htm CURRENT REPORT 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 28, 2005 CELANESE CORPORATION (Exact Name of Registrant as specified in its charter) DELAWARE 001-32410 98-0420726 (State or other jurisdiction (Commission File (IRS Employer of incorporation) Number) Identification No.) 1601 West LBJ Freeway, Dallas, Texas 75234-6034 (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (972) 901-4500 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): [[Image Removed]] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [[Image Removed]] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [[Image Removed]] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [[Image Removed]] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) -------------------------------------------------------------------------------- Back to Contents Item 7.01 Regulation FD Disclosure On February 28, 2005, David N. Weidman, President and Chief Executive Officer of Celanese Corporation (the “Company”), and Corliss Nelson, Executive Vice President and Chief Financial Officer of the Company, made a presentation to investors and analysts via webcast and teleconference hosted by the Company. A copy of the slide presentation posted during the webcast and teleconference 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 7.01 disclosure. Additionally, the Company has posted the slide presentation on its website at www.celanese.com under the Investor/Investor Webcast section. The information in this Current Report, including the exhibit 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 exhibit, 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. Item 9.01 Financial Statements and Exhibits. (c) Exhibits Exhibit Number Description 99.1 Slide Presentation dated February 28, 2005 -------------------------------------------------------------------------------- Back to Contents 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/ Corliss J. Nelson Name: Corliss J. Nelson Title: Executive Vice President and Chief Financial Officer Date: March 1, 2005 -------------------------------------------------------------------------------- Back to Contents Exhibit Index Exhibit Number Description 99.1 Slide Presentation dated February 28, 2005 -------------------------------------------------------------------------------- EX-99 3 b405062_ex99.htm ADDITIONAL EXHIBITS Exhibit 99 [[Image Removed]] Transformation and Results Celanese 4Q2004 Earnings Conference Call/Webcast Mon., Feb. 28, 2005 10 a.m CT David Weidman, CEO C.J. Nelson, CFO -------------------------------------------------------------------------------- [[Image Removed]] 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 presentation, the words “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 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. For a discussion of some of the factors, we recommend that you review the Company’s Registration Statement on Form S-1 at the SEC’s website at www.sec.gov. 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. -------------------------------------------------------------------------------- [[Image Removed]] Reconciliation of Non-GAAP Measures to U.S. GAAP ----------------------------------- This presentation reflects our performance measures, net debt, and Segment Earnings as non-U.S. GAAP measures. The most directly comparable financial measure presented in accordance with U.S. GAAP in our financial statements for net debt is total debt and for Segment Earnings is earnings (loss) from continuing operations before tax and minority interests. This presentation also reflects our debt covenant measure Adjusted EBITDA. The most directly comparable financial measure presented in accordance with U.S. GAAP in our financial statements for this is net earnings (loss). This presentation also reflects the 2004 net sales, operating profit, net income and depreciation and amortization as a summation of these measures derived from (i) the financial statements for the predecessor for the three months ended March 31, 2004, and (ii) the financial statements for the successor for the nine months ended December 31, 2004, for each period prepared on a basis consistent with U.S. GAAP. The combined presentation is not in accordance with GAAP. For a reconciliation of these non-U.S. GAAP measures to U.S. GAAP figures see the accompanying schedules to this presentation. Reconciliations of any forward-looking non-U.S. GAAP measure to U.S. GAAP measures are not available. -------------------------------------------------------------------------------- [[Image Removed]] Use of Non-GAAP Financial Information ------------------------------------- Adjusted EBITDA, a performance measure used by management, is defined as earnings (loss) from continuing operations, plus interest expense net of interest income, income taxes and depreciation and amortization, and further adjusted for certain cash and non-cash charges. Our management believes Adjusted EBITDA is useful to investors because it is used in our debt instruments to determine compliance with financial covenants and our ability to engage in certain activities such as incurring additional debt and making certain payments. Segment Earnings, another performance measure used by management, is defined as earnings (loss) from continuing operations before tax and minority interests excluding depreciation and amortization, special charges, stock appreciation rights and inventory step up. Adjusted EBITDA and Segment Earnings are the primary measures our management uses for its planning and budgeting processes and to monitor and evaluate financial and operating results. Adjusted EBITDA and Segment Earnings are not recognized terms under U.S. GAAP and do not purport to be alternatives to net earnings as measures 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 Adjusted EBITDA and Segment Earnings may not be comparable to other similarly titled measures of other companies. Additionally, Adjusted EBITDA and Segment Earnings are not intended to be measures of free cash flow for management’s discretionary use, as they do not consider certain cash requirements such as interest payments, tax payments and debt service requirements. We believe that the presentation of all of the non-GAAP information 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 GAAP information is viewed in conjunction with non-GAAP information, investors are provided with a more meaningful understanding of our ongoing operating performance. This non-GAAP information is not intended to be considered in isolation or as a substitute for GAAP financial information. -------------------------------------------------------------------------------- [[Image Removed]] Q4 and ’04 Results ------------------ Combined (in $millions) Q404 FY04 ------------- ------------- Sales $1,332 up 15% $5,069 up 10% Gross Profit $303 up 98% $975 up 35% Net Earnings (loss) $(57 ) $(175 ) Dividends from Affiliates $11 $77 Adjusted EBITDA $187 up 3% $801 up 19% [[Image Removed]] Strong demand across all lines, regions [[Image Removed]] Results occurred during time of transformation Underlying results reflect strength of strategy -------------------------------------------------------------------------------- [[Image Removed]] - C. J. Nelson Executive Vice President and Chief Financial Officer -------------------------------------------------------------------------------- [[Image Removed]] Financial Overview ------------------ Fourth Quarter Full Year ----------------------- ---------------------- (in $millions) Successor Predecessor Combined Predecessor 2004 2003 2004 2003 --------- ----------- -------- ----------- Sales 1,332 1,155 5,069 4,603 Gross Profit 303 153 975 720 SG&A (220) (126) (635) (510) Special Charges (33) (14) (119) (5) Operating Profit (Loss) 28 (10) 130 118 Interest Expense (72) (13) (306) (49) Tax (12) 8 (87) (53) Net Earnings (Loss) (57) 18 (175) 148 Affiliate Dividends 11 29 77 76 Adjusted EBITDA 187 182 801 675 -------------------------------------------------------------------------------- [[Image Removed]] Net Earnings to Adjusted EBITDA walk - 2004 ------------------------------------------- [[Image Removed]] -------------------------------------------------------------------------------- [[Image Removed]] Significant Contribution from Joint Ventures -------------------------------------------- [[Image Removed]] Joint Venture Investments Drive Strategic Growth and Financial Performance Note: (1) 2004 Proportional D&A from affiliates shown is an estimate (2) D&A as presented in the chart above represents the amount recorded by the investees based on local generally accepted accounting principles, computed in proportion to our ownership percentage. These amounts are not included in the D&A reported by Celanese. -------------------------------------------------------------------------------- [[Image Removed]] Pro Forma Capitalization (1) ---------------------------- Pro-Forma as of 12/31/04 ----------------------------- December 31, 2004 Post- IPO With Acquisitions ----------------- --------- ----------------- Cash $838 $838 $838 ----------------- --------- ----------------- Existing Term Loan B(2) $624 $0 $0 New Term Loan B(3) $0 $1,569 $1,769 New Delayed Draw Term Loan C $0 $0 $242 Floating Rate Term Loan $350 $0 $0 ----------------- --------- ----------------- Total Senior Debt $974 $1,569 $2,011 ----------------- --------- ----------------- Senior Sub Notes ($) $1,231 $800 $800 Senior Sub Notes (€)(4) $272 $177 $177 Acetex Notes $0 $0 $265 Assumed Debt $383 $383 $383 ----------------- --------- ----------------- Total Cash Pay Debt $2,860 $2,929 $3,636 ----------------- --------- ----------------- Discount Notes Series A $103 $66 $66 Discount Notes Series B $424 $276 $276 ----------------- --------- ----------------- Total Debt $3,387 $3,271 $3,978 ----------------- --------- ----------------- Convertible Preferred $240 $240 Market Capitalization $2,741(5) $2,741(5) --------- ----------------- Total Capitalization $6,252 $6,959 --------- ----------------- 1 Table shows debt balances and pro forma 4 Converted at €1 =$1.3621 adjustments as of 12/31/04 2 Includes €125 million of Euro denominated debt 5 Based on closing price of (converted at €1 = $1.3621) $17.27 on 2/25/05 3 Includes €275 million of Euro denominated debt (converted at €1 = $1.3621) -------------------------------------------------------------------------------- [[Image Removed]] Pension and OPEB Plan Obligations --------------------------------- [[Image Removed]] Aggressive contributing increased funded status dramatically • Plan contributions of $500 million increased ABO funded status from 77% at FYE ‘03 to 90% at FYE ’04 [[Image Removed]] Total benefit obligations decreased • Total benefit obligations decreased from $1.165 billion to $1.006 billion as plan contributions offset increases from purchase accounting [[Image Removed]] 2005 pension contribution expense is half of 2004 levels • As a result of purchase accounting and plan contributions, 2005 pension expense is expected to be $26 million and 2005 OPEB expense is also expected to be $26 million. On a historical basis, 2004 cost was over $110 million [[Image Removed]] Under current pension legislation, we do not anticipate making pension plan contributions for the foreseeable future -------------------------------------------------------------------------------- [[Image Removed]] 2004 Capital Expenditures ------------------------- [[Image Removed]] -------------------------------------------------------------------------------- [[Image Removed]] - Business Segment/2005 Outlook David Weidman Chief Executive Officer -------------------------------------------------------------------------------- [[Image Removed]] 2004 Business Highlights ------------------------ [[Image Removed]] Vinamul acquisition* extends Acetyls chain [[Image Removed]] Announced Acetex acquisition provides for reliable supply to global market [[Image Removed]] Acetate restructuring to enhance profitability of a leading Celanese business [[Image Removed]] Nanjing, China plant becoming reality [[Image Removed]] SG&A actions in all major businesses and administrative centers [[Image Removed]] Procurement initiatives on track * Announced ’04, completed ‘05 -------------------------------------------------------------------------------- [[Image Removed]] Chemicals Products Historical Perspective: ------------------------------------------ [[Image Removed]] Margin expansion in Q4 and full year [[Image Removed]] Strong demand, favorable pricing in all regions during year, and improved productivity [[Image Removed]] Fourth quarter results particularly strong (in $millions) Q404 FY2004 Combined ----------- --------------- Sales $925 up 21% $3,391 up 11% Segment Earnings(1) $142 up 78% $476 up 38% (1) – Earnings from continuing operations before tax and minority interests excluding Depreciation and amortization, Special Charges, Stock Appreciation Rights, Inventory Step up -------------------------------------------------------------------------------- [[Image Removed]] Chemical Products Outlook ------------------------- 1st Quarter --------------------------------------------------------------------------- [[Image Removed]] Sustained demand, favorable pricing [[Image Removed]] Modest raw material increases [[Image Removed]] Margin momentum continues Full Year --------------------------------------------------------------------------- [[Image Removed]] Sustained demand pricing [[Image Removed]] Southern Methanol decreases Gulf Coast gas exposure [[Image Removed]] Ethylene price relief from contracts [[Image Removed]] Second half supply/demand balance to loosen on expansions [[Image Removed]] Positive pricing momentum in downstream Celanese products -------------------------------------------------------------------------------- [[Image Removed]] Ticona Historical Perspective ----------------------------- [[Image Removed]] Solid ’04 volume growth of 13%, all lines contributing [[Image Removed]] Raw material increases offset by volume growth during year [[Image Removed]] Q4 volume growth rate declines but is still strong at 6% [[Image Removed]] Q4 profit erosion due to raw materials, price, and effects of maintenance turnaround [[Image Removed]] $32 million impairment charge for planned COC sale (in $millions) Q404 FY2004 Combined ------------ --------------- Sales $203 up 8% $863 up 13% Segment Earnings(1) $18 down 28% $192 up 28% (1) – Earnings from continuing operations before tax and minority interests excluding Depreciation and amortization, Special Charges, Stock Appreciation Rights, Inventory Step up -------------------------------------------------------------------------------- [[Image Removed]] Ticona Outlook -------------- 1st Quarter --------------------------------------------------------------------------------- [[Image Removed]] Continuation of slowed demand and raw material pressures Full Year --------------------------------------------------------------------------------- [[Image Removed]] Earnings growth momentum to pick up in second half and beyond after temporary correction in key markets -------------------------------------------------------------------------------- [[Image Removed]] Acetate/Performance Products Summaries -------------------------------------- Acetate --------------------------------------------------------------------------------- [[Image Removed]] Stable financial results continue [[Image Removed]] Focus is on completion of restructuring plan and significant benefits Performance Products --------------------------------------------------------------------------------- [[Image Removed]] Strong earnings in full year on Sunett volume growth [[Image Removed]] Profitability will decline after patent expiration in March ’05, but will remain high margin business -------------------------------------------------------------------------------- [[Image Removed]] Combined Business Outlook ------------------------- 1st Quarter --------------------------------------------------------------------------------- [[Image Removed]] 25-30% increase in adjusted EBITDA vs. Q1 ’04 [[Image Removed]] Reflective of strong business growth and affiliate dividends Full Year --------------------------------------------------------------------------------- [[Image Removed]] 12-17% growth in adjusted EBITDA vs. ‘04 [[Image Removed]] Reflective of strong business environment, methanol agreement and acquisitions -------------------------------------------------------------------------------- Appendix -------------------------------------------------------------------------------- [[Image Removed]] Appendix – Full Year 2005 Key Modeling Assumptions -------------------------------------------------- Equity – CE Shares • Common stock = 158.7 million outstanding • Fully diluted common stock = 170.7 million • Preferred stock dividends = approx. $10 million on 9.6 million outstanding shares Equity – CAG Minority Interest • Approximately 8 million shares outstanding as of February 16 • Current tender offer price = €41.92/share • Net guaranteed payment = approximately €24 million Capital Expenditures • Capital expenditures = $210 - $230 Income Statement ($ millions) • Depreciation = $230-$250 • Special charges = $30-$50 • Interest expense = $250-$260 • Excluding deferred finance/debt premium of approx. $115 • Avg cost of borrowed capital = 7% • Effective tax rate of 34% to 37% • Monitoring fee • Annual fee $10 • Cancellation $35 • Terminated Jan ’05 -------------------------------------------------------------------------------- [[Image Removed]] Reconciliation of Segment Earnings ---------------------------------- -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- Q4 2004 Successor Q4 2003 Predecessor Technical Technical Chemical Polymers Acetate Performance Other Chemical Polymers Acetate Performance Other Products Ticona Products Products Activities Total Products Ticona Products Products Activities Total -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- Earnings(loss) from Continuing Operations before Tax and Minority Interests 131 (29) 18 3 (162) (39) 35 (9) 2 11 (42) (3) Depreciation and Amortization 12 14 3 5 0 34 41 14 23 1 2 81 Special Charges (1) 33 0 0 1 33 0 16 0 0 (2) 14 Stock Appreciation Rights 0 0 0 0 0 0 4 4 1 0 9 18 Purchase Accounting for Inventories 0 0 0 0 0 0 0 0 0 0 0 0 -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- Segment Earnings 142 18 21 8 (161) 28 80 25 26 12 (33) 110 -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- FY 2004 Combined FY 2003 Predecessor -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- Technical Technical Chemical Polymers Acetate Performance Other Chemical Polymers Acetate Performance Other Products Ticona Products Products Activities Total Products Ticona Products Products Activities Total -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- Earnings(loss) from Continuing Operations before Tax and Minority Interests 329 71 2 26 (530) (102) 175 167 17 (44) (119) 196 Depreciation and Amortization 128 64 46 12 6 256 157 57 66 7 7 294 Special Charges 4 38 50 0 27 119 (1) (87) 0 95 (2) 5 Stock Appreciation Rights 0 1 0 0 0 1 14 13 4 1 27 59 Purchase Accounting for Inventories 15 18 4 12 0 49 0 0 0 0 0 0 -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- Segment Earnings 476 192 102 50 (497) 323 345 150 87 59 (87) 554 -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- -------- -- --------- -- -------- -- ----------- -- ---------- -- ----- --------------------------------------------------------------------------------