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8-K - FORM 8-K - Celanese Corpd79349e8vk.htm
EX-99.2 - EX-99.2 - Celanese Corpd79349exv99w2.htm
Exhibit 99.1
(CELANESE LOGO)            
     
 
  Celanese Corporation
 
  Investor Relations
Corporate News Release
  1601 West LBJ Freeway
 
  Dallas, Texas 75234
Celanese Corporation Reports Fourth Quarter and Full Year 2010 Results;
Raises Outlook for 2011
Fourth quarter highlights:
    Net sales were $1,507 million, up 9% from prior year period
 
    Operating profit was $138 million versus $109 million in prior year period
 
    Net earnings were $56 million versus $6 million in prior year period
 
    Operating EBITDA was $262 million, up 15% from prior year period
 
    Diluted EPS from continuing operations was $0.64 versus $0.00 in prior year period
 
    Adjusted EPS was $0.73, up 43% from prior year period
                                 
    Three Months Ended   Twelve Months Ended
    December 31,   December 31,
(in $ millions, except per share data) — Unaudited   2010   2009   2010   2009
            As adjusted3           As adjusted3
 
                               
Net sales
    1,507       1,388       5,918       5,082  
Operating profit (loss)
    138       109       501       290  
Net earnings (loss) attributable to Celanese Corporation
    56       6       375       498  
Operating EBITDA 1
    262       228       1,122       857  
Diluted EPS — continuing operations
  $ 0.64     $ 0.00     $ 2.68     $ 3.14  
Diluted EPS — total
  $ 0.35     $ 0.03     $ 2.37     $ 3.17  
Adjusted EPS 2
  $ 0.73     $ 0.51     $ 3.37     $ 1.75  
     
1   Non-U.S. GAAP measure. See reconciliation in Table 1.
 
2   Non-U.S. GAAP measure. See reconciliation in Table 6.
 
3   The company’s Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes.
Dallas, February 1, 2011: Celanese Corporation (NYSE: CE), a global technology and specialty materials company, today reported fourth quarter 2010 net sales of $1,507 million, a 9 percent increase from the same period last year. All of its operating segments experienced improved pricing and higher volumes which drove the improved results and more than offset unfavorable currency impacts. Operating profit increased to $138 million from $109 million in the prior year period. This quarter’s results included a net $16 million of other charges and other adjustments which were primarily related to the company’s previously announced manufacturing optimization efforts compared with $17 million in the prior year period. Net earnings were $56 million compared with $6 million in the same period last year, also reflecting strong performance from the company’s strategic affiliates in the current period. Diluted earnings per share from continuing operations were $0.64 compared with $0.00 in the prior year period. Diluted earnings per share were $0.35 compared with $0.03 in the same period last year.
Adjusted earnings per share in the fourth quarter of 2010 increased to $0.73 from $0.51 in the same period last year. Adjusted earnings per share in the current period were based on an effective tax rate of 20 percent


 

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and a diluted share count of 158.3 million. Operating EBITDA rose 15 percent to $262 million from $228 million in the same period last year. Adjusted earnings per share and operating EBITDA excluded the $16 million of other charges and other adjustments.
“Our fourth quarter 2010 performance concludes a very strong year with record full-year earnings in Consumer Specialties, Advanced Engineered Materials and Industrial Specialties, as well as significantly improved performance in Acetyl Intermediates,” said David Weidman, chairman and chief executive officer. “With successful innovation efforts, a sustained focus on productivity and the breadth of our geographic profile, Celanese, with its unique portfolio of leading global businesses, is extremely well positioned for value creation both in the near-term and long-term.”
Recent Highlights
    Announced its newly developed advanced technology to produce ethanol. This innovative, new process combines the company’s proprietary and industry-leading acetyl platform with highly advanced manufacturing technology to produce ethanol from hydrocarbon-sourced feedstocks.
 
    Signed letters of intent for projects to construct and operate industrial ethanol production facilities in Nanjing, China, at the Nanjing Chemical Industrial Park and in Zhuhai, China, at the Gaolan Port Economic Zone.
 
    Signed a memorandum of understanding (MOU) with Wison (China) Holding Co., Ltd., a Chinese synthesis gas supplier, for production of certain feedstocks used in the company’s advanced ethanol production process.
 
    Launched VitalDose™, an ethylene vinyl acetate (EVA) polymer-based excipient that facilitates drug makers’ efforts to develop and commercialize controlled-release pharmaceutical solutions.
Fourth Quarter Segment Overview
Advanced Engineered Materials
Advanced Engineered Materials sustained year-over-year volume growth on continued strong global demand, further supported by the results of its successful innovation efforts. Net sales for the fourth quarter of 2010 were $274 million compared with $239 million in the prior year period, driven by increased volumes for its high performance polymers. This quarter’s results benefited from higher value-in-use pricing and sales related to the company’s recent acquisitions which more than offset the impacts of currency. Operating profit was $33 million compared with $34 million in the same period last year as the profit contribution from higher volumes and pricing were offset by increased raw material costs and other expenses primarily associated with a planned turnaround in North America and the timing of other costs. Operating profit in the quarter was also negatively impacted by expenses associated with the company’s planned European expansion. Operating EBITDA in the fourth quarter of 2010, which excluded the impact of the inventory build in support of the European expansion, was $68 million and unchanged from the prior year period. Advanced Engineered Materials strategic affiliates continued to provide benefits from both growth in emerging markets and


 

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advantaged raw material positions in the period. Equity earnings from the Ibn Sina affiliate were $17 million, a $1 million decrease from last year’s results. Total equity earnings from the company’s Asian affiliates were $13 million compared with $0 in the prior year period on improved performance in the current period and the impact of a planned turnaround at one of the Asian affiliates during the fourth quarter of 2009.
Consumer Specialties
Consumer Specialties delivered strong performance on improved global demand across all product lines, particularly for cellulose acetate products. Net sales for the fourth quarter were $281 million compared with $267 million in the same period last year driven by higher volumes and increased pricing. Operating profit increased to $59 million from $47 million in the prior year period as the favorable volume and pricing more than offset increased raw material and energy costs as well as other charges and other adjustments primarily associated with the planned closure of the company’s acetate flake and tow manufacturing operations in Spondon, Derby, United Kingdom. Operating EBITDA, which excluded charges associated with the plant closure and other adjustments, was $80 million compared with $65 million in the prior year.
Industrial Specialties
Industrial Specialties benefited from its application innovation efforts and strong demand. Net sales for the fourth quarter of 2010 were $249 million compared with $229 million in the same period last year, resulting from higher pricing and volumes. Higher pricing for EVA performance polymers products was driven by favorable product mix on strong demand, particularly for photovoltaic applications, helping to offset unfavorable currency effects. Volumes also improved in the Emulsions business, driven by the benefits of new product innovation and commercialization. Operating profit in the fourth quarter of 2010 was $11 million compared with $16 million in the prior year period as the higher volumes and pricing were partially offset by higher raw material costs, particularly in the Emulsions business. Fourth quarter 2009 results included a $10 million captive insurance recovery related to the force majeure event at the company’s performance polymers facility in Edmonton, Canada. Operating EBITDA was $27 million compared with $19 million, excluding the insurance recovery in the prior year period.
Acetyl Intermediates
Acetyl Intermediates delivered improved results on seasonally strong demand for acetic acid and downstream derivative products. Net sales for the fourth quarter of 2010 were $799 million compared with $743 million in the same period last year. The increase was primarily driven by improved pricing across all global regions for the major acetyl product lines, particularly for downstream derivatives. The improved pricing environment was supported by increased raw material costs as well as favorable industry conditions resulting from energy conservation efforts in China that affected competing technologies. Downstream derivative volumes also improved due to demand recovery in the Americas and Europe. Operating profit in the current


 

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period increased to $94 million from $72 million in the prior year period, driven by the higher pricing and volumes, as well as the benefits of the closure of the company’s operations in Pardies, France. These benefits were partially offset by higher raw material costs for methanol and ethylene. Operating EBITDA rose to $127 million in the fourth quarter of 2010 from $111 million in the same period last year.
Taxes
The tax rate for adjusted earnings per share was 20 percent in the year ended December 31, 2010 compared with 29 percent in the first six months of 2009 and 23 percent for the last six months of 2009. The U.S. GAAP effective tax rate for continuing operations in 2010 was 21 percent versus negative 97 percent in 2009. The effective tax rate for 2009 was favorably impacted by the release of the U.S. valuation allowance on net deferred tax assets, partially offset by increases in valuation allowances on certain foreign net deferred tax assets and the effect of new tax legislation in Mexico. The effective rate for 2010 was favorably impacted by amendments to tax legislation in Mexico.
Cash taxes paid were $135 million in 2010 compared with $17 million in 2009. The increase in cash taxes paid is primarily the result of increased earnings in 2010 and the timing of cash taxes in certain jurisdictions.
Equity and Cost Investments
Earnings from equity investments and dividends from cost investments, which are reflected in the company’s earnings and operating EBITDA, were $37 million in the fourth quarter of 2010, a $15 million increase from the prior year period. Equity and cost investment dividends, which are included in cash flows, were $18 million, a $5 million decrease from the same period last year.
Earnings in equity investments for Ticona’s strategic affiliates in Asia were $13 million higher than the prior year period. Proportional affiliate EBITDA for the Asian affiliates was $30 million, a $9 million increase from the same period last year.
Equity in net earnings for Ticona’s Middle Eastern affiliates, which includes the company’s Ibn Sina affiliate, were $17 million in the fourth quarter of 2010 compared with $18 million in the same period last year. Proportional affiliate EBITDA for the Middle Eastern affiliates was $2 million lower than the prior year period.
The company’s total proportional affiliate EBITDA of equity investments for the fourth quarter of 2010 was $72 million, an $11 million increase from the same period last year and $35 million more than reported in the company’s operating EBITDA. The company’s total proportional net debt of affiliates was $96 million as of December 31, 2010.


 

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Cash Flow
Cash and cash equivalents at the end of the fourth quarter of 2010 were $740 million, $514 million lower than the same period in 2009. Cash flow provided by operating activities was $452 million for the full year 2010 compared with $596 million in the prior year, as higher trade working capital and higher cash taxes offset the improved operating performance.
The company used $560 million in net cash for investing activities in the full year 2010 compared with $31 million provided in 2009. During 2010, the company spent a total of $312 million of capital expenditures related to the relocation of Ticona’s business in Kelsterbach, Germany and related capacity expansion. The 2009 results included an advance payment of $412 million and $351 million of capital expenditures and other expenses related to the relocation and expansion. The 2009 results also included net cash of $168 million received from the sale of the polyvinyl alcohol business.
Net cash used in financing activities totaled $388 million in the full year 2010 compared with $112 million in 2009. In 2010, the company repaid a net of $297 million of long-term debt, repurchased $48 million of its outstanding common shares, paid $31 million of dividends and paid $24 million of debt refinancing costs.
Net debt at the end of the fourth quarter of 2010 was $2,478 million, $231 million higher than the prior year period.
Outlook
Based on the strength of its 2010 performance, its confidence in its earnings growth programs, and its expectations for a continued, modest global economic recovery, the company raised its outlook for the full year 2011. The company expects full year 2011 adjusted earnings per share to be at least $0.60 higher and operating EBITDA to be at least $150 million higher than 2010 results.
“We are confident that our unique portfolio of technology and specialty materials businesses, coupled with our ongoing growth, innovation and productivity initiatives, will enable us to deliver significant earnings improvement and increased value for our shareholders,” said Weidman. “We continue to see healthy demand across all of our business lines and expect to see earnings growth in every segment in 2011.”
Contacts:
         
Investor Relations
  Media — U.S.   Media — Europe
Andy Green
  Jacqueline Terry   Jens Kurth
Phone: +1 972 443 4965
  Phone: +1 972 443 4417   Phone: +49 (0)6107 772 1574
Telefax: +1 972 443 8519
  Telefax: +1 972 443 8519   Telefax: +49 (0)6107 772 7231
Andy.Green@celanese.com
  Jacqueline.Terry@celanese.com   J.Kurth@celanese.com


 

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Celanese Corporation is a global technology leader in the production of specialty materials and chemical products which are used in most major industries and consumer applications. Our products, essential to everyday living, are manufactured in North America, Europe and Asia. Known for operational excellence, sustainability and premier safety performance, Celanese delivers value to customers around the globe with best-in-class technologies. Based in Dallas, Texas, the company employs approximately 7,250 employees worldwide and had 2010 net sales of $5.9 billion, with approximately 72% generated outside of North America. For more information about Celanese Corporation and its global product offerings, visit 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 results expressed or implied in the forward-looking statements contained in this release. These risks and uncertainties include, among other things: changes in general economic, business, political and regulatory conditions in the countries or regions in which we operate; the length and depth of business cycles, particularly in the automotive, electrical, electronics and construction industries; changes in the price and availability of raw materials; the ability to pass increases in raw material prices on to customers or otherwise improve margins through price increases; the ability to maintain plant utilization rates and to implement planned capacity additions and expansions; the ability to improve productivity by implementing technological improvements to existing plants; increased price competition and the introduction of competing products by other companies; market acceptance of our technology; the ability to obtain governmental approvals and to construct facilities on terms and schedule acceptable to the company; changes in the degree of intellectual property and other legal protection afforded to our products; compliance and other costs and potential disruption of production due to accidents or other unforeseen events or delays in construction or operation of facilities; potential liability for remedial actions and increased costs under existing or future environmental regulations, including those relating to climate change; potential liability resulting from pending or future litigation, or from changes in the laws, regulations or policies of governments or other governmental activities in the countries in which we operate; changes in currency exchange rates and interest rates; and various other factors discussed from time to time in the company’s filings with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which it is made, and the company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date on which it is made or to reflect the occurrence of anticipated or unanticipated events or circumstances.


 

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Reconciliation of Non-U.S. GAAP Measures to U.S. GAAP
This release reflects the following performance measures: operating EBITDA, business operating EBITDA, proportional affiliate EBITDA and affiliate EBITDA, adjusted earnings per share, and net debt as non-U.S. GAAP measures. These measurements are not recognized in accordance with U.S. GAAP and should not be viewed as an alternative to U.S. GAAP measures of performance. The most directly comparable financial measure presented in accordance with U.S. GAAP in our consolidated financial statements for operating EBITDA and business operating EBITDA is net income; for proportional affiliate EBITDA is equity in net earnings of affiliates; for affiliate EBITDA is operating profit; for adjusted earnings per share is earnings per common share-diluted; and for net debt is total debt.
Use of Non-U.S. GAAP Financial Information
    Operating EBITDA is defined by the company as net earnings plus loss (earnings) from discontinued operations, interest expense, taxes, and depreciation and amortization, and further adjusted for Other Charges and Adjustments as described in Table 7. We present operating EBITDA because we consider it an important supplemental measure of our operations and financial performance. We believe that operating EBITDA is more reflective of our operations as it provides transparency to investors and enhances period-to-period comparability of our operations and financial performance. Operating EBITDA is one of the measures management uses for its planning and budgeting process to monitor and evaluate financial and operating results and for the company’s incentive compensation plan. Operating EBITDA should not be considered as an alternative to net income determined in accordance with U.S. GAAP. We may provide guidance on operating EBITDA and are unable to reconcile forecasted operating EBITDA to a U.S. GAAP financial measure because a forecast of Other Charges and Adjustments is not practical.
 
    Business operating EBITDA is defined by the company as net earnings plus loss (earnings) from discontinued operations, interest expense, taxes and depreciation and amortization, and further adjusted for Other Charges and Adjustments as described in Table 7, less equity in net earnings of affiliates, dividend income from cost investments and other (income) expense. This supplemental performance measure reflects the operating results of the company’s operations without regard to the financial impact of its equity and cost investments.
 
    Proportional affiliate EBITDA is defined by the company as the proportional operating profit plus the proportional depreciation and amortization of its equity investments. Affiliate EBITDA is defined by the company as operating profit plus the depreciation and amortization of its equity affiliates. The company has determined that it does not have sufficient ownership for operating control of these investments to consider their results on a consolidated basis. The company believes that investors should consider proportional affiliate EBITDA as an additional measure of operating results.
 
    Adjusted earnings per share is a measure used by management to measure performance. It is defined by the company as net earnings (loss) available to common shareholders plus preferred dividends, adjusted for Other Charges and Adjustments as described in Table 7, and divided by the number of basic common shares, diluted preferred shares, and options valued using the treasury method. We may provide guidance on an adjusted earnings per share basis and are unable to reconcile forecasted adjusted earnings per share to a U.S. GAAP financial measure without unreasonable effort because a forecast of Other Items is not practical. We believe that the presentation of this non-U.S. GAAP measure provides useful information to management and investors regarding various financial and business trends relating to our financial condition and results of operations, and that when U.S. GAAP information is viewed in conjunction with non-U.S. GAAP information, investors are provided with a more meaningful understanding of our ongoing operating performance. Note: The tax rate used for adjusted earnings per share approximates the midpoint in a range of forecasted tax rates for the year, excluding changes in uncertain tax positions, discrete items and other material items adjusted out of our U.S. GAAP earnings for adjusted earnings per share purposes, and changes in management’s assessments regarding the ability to realize deferred tax assets. We analyze this rate quarterly and adjust if there is a material change in the range of forecasted tax rates; an updated forecast would not necessarily result in a change to our tax rate used for adjusted earnings per share. The adjusted tax rate is an estimate and may differ significantly from the tax rate used for U.S. GAAP reporting in any given reporting period. It is not practical to reconcile our prospective adjusted tax rate to the actual U.S. GAAP tax rate in any future period.
 
    Net debt is defined by the company as total debt less cash and cash equivalents. We believe that the presentation of this non-U.S. GAAP measure provides useful information to management and investors regarding changes to the company’s capital structure. Our management and credit analysts use net debt to evaluate the company’s capital structure and assess credit quality. Proportional net debt is defined as our proportionate share of our affiliates’ net debt.
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)   2010   2009   2010   2009
            As Adjusted1           As Adjusted1
Net sales
    1,507       1,388       5,918       5,082  
Cost of sales
    (1,194 )     (1,099 )     (4,738 )     (4,079 )
     
Gross profit
    313       289       1,180       1,003  
 
                               
Selling, general and administrative expenses
    (132 )     (133 )     (505 )     (474 )
Amortization of Intangible assets
    (16 )     (19 )     (61 )     (77 )
Research and development expenses
    (18 )     (17 )     (70 )     (70 )
Other (charges) gains, net
    (1 )     (13 )     (48 )     (136 )
Foreign exchange gain (loss), net
    (4 )     1       (3 )     2  
Gain (loss) on disposition of businesses and assets, net
    (4 )     1       8       42  
     
Operating profit (loss)
    138       109       501       290  
 
                               
Equity in net earnings (loss) of affiliates
    37       22       168       99  
Interest expense
    (58 )     (51 )     (204 )     (207 )
Refinancing expense
                (16 )      
Interest income
    5       1       7       8  
Dividend income — cost investments
                73       57  
Other income (expense), net
    6       6       7       4  
     
Earnings (loss) from continuing operations before tax
    128       87       536       251  
 
                               
Income tax (provision) benefit
    (27 )     (85 )     (112 )     243  
     
Earnings (loss) from continuing operations
    101       2       424       494  
 
                               
Earnings (loss) from operation of discontinued operations
    (72 )     6       (80 )     6  
Gain on disposal of discontinued operations
                2        
Income tax (provision) benefit, discontinued operations
    27       (2 )     29       (2 )
     
Earnings (loss) from discontinued operations
    (45 )     4       (49 )     4  
 
                               
Net earnings (loss)
    56       6       375       498  
Less: Net earnings (loss) attributable to noncontrolling interests
                       
     
Net earnings (loss) attributable to Celanese Corporation
    56       6       375       498  
     
 
                               
Cumulative preferred stock dividend
          (2 )     (3 )     (10 )
     
Net earnings (loss) available to common shareholders
    56       4       372       488  
     
 
                               
Amounts attributable to Celanese Corporation
                               
Earnings (loss) per common share — basic
                               
Continuing operations
  $ 0.65     $ 0.00     $ 2.72     $ 3.37  
Discontinued operations
    (0.29 )     0.03       (0.31 )     0.03  
     
Net earnings (loss) — basic
  $ 0.36     $ 0.03     $ 2.41     $ 3.40  
     
 
                               
Earnings (loss) per common share — diluted
                               
Continuing operations
  $ 0.64     $ 0.00     $ 2.68     $ 3.14  
Discontinued operations
    (0.29 )     0.03       (0.31 )     0.03  
     
Net earnings (loss) — diluted
  $ 0.35     $ 0.03     $ 2.37     $ 3.17  
     
 
                               
Weighted average shares (millions)
                               
Basic
    155.7       144.1       154.6       143.7  
Diluted
    158.3       144.1       158.4       157.1  
     
1   The company’s Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes.


 

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Preliminary Consolidated Balance Sheets — Unaudited
                 
    December 31,   December 31,
(in $ millions)   2010   2009
            As Adjusted1
ASSETS
               
Current assets
               
Cash & cash equivalents
    740       1,254  
Trade receivables — third party and affiliates, net
    827       721  
Non-trade receivables
    253       262  
Inventories
    610       522  
Deferred income taxes
    92       42  
Marketable securities, at fair value
    78       3  
Assets held for sale
    9       2  
Other assets
    59       50  
 
Total current assets
    2,668       2,856  
 
               
Investments in affiliates
    838       792  
Property, plant and equipment, net
    3,017       2,797  
Deferred income taxes
    443       484  
Marketable securities, at fair value
          80  
Other assets
    289       311  
Goodwill
    774       798  
Intangible assets, net
    252       294  
 
Total assets
    8,281       8,412  
 
 
               
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
Current liabilities
               
Short-term borrowings and current installments of long-term debt — third party and affiliates
    228       242  
Trade payables — third party and affiliates
    673       649  
Other liabilities
    596       611  
Deferred income taxes
    28       33  
Income taxes payable
    17       72  
 
Total current liabilities
    1,542       1,607  
 
               
Long-term debt
    2,990       3,259  
Deferred income taxes
    116       137  
Uncertain tax positions
    273       229  
Benefit obligations
    1,359       1,288  
Other liabilities
    1,077       1,306  
Commitments and contingencies
               
Shareholders’ equity
               
Preferred stock
           
Common stock
           
Treasury stock, at cost
    (829 )     (781 )
Additional paid-in capital
    574       522  
Retained earnings
    1,849       1,505  
Accumulated other comprehensive income (loss), net
    (670 )     (660 )
 
Total Celanese Corporation shareholders’ equity
    924       586  
Noncontrolling interests
           
 
Total shareholders’ equity
    924       586  
 
Total liabilities and shareholders’ equity
    8,281       8,412  
 
1   The company’s Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes.


 

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Table 1

Segment Data and Reconciliation of Operating Profit (Loss) to Operating EBITDA — a Non-U.S. GAAP Measure — Unaudited
                                 
    Three Months Ended   Twelve Months Ended
    December 31,   December 31,
(in $ millions)   2010   2009   2010   2009
            As Adjusted4           As Adjusted4
Net Sales
                               
Advanced Engineered Materials
    274       239       1,109       808  
Consumer Specialties
    281       267       1,098       1,084  
Industrial Specialties
    249       229       1,036       974  
Acetyl Intermediates
    799       743       3,082       2,603  
Other Activities 1
    1       1       2       2  
Intersegment eliminations
    (97 )     (91 )     (409 )     (389 )
     
Total
    1,507       1,388       5,918       5,082  
     
 
                               
Operating Profit (Loss)
                               
Advanced Engineered Materials
    33       34       184       38  
Consumer Specialties
    59       47       164       231  
Industrial Specialties
    11       16       89       89  
Acetyl Intermediates
    94       72       243       92  
Other Activities 1
    (59 )     (60 )     (179 )     (160 )
     
Total
    138       109       501       290  
     
 
                               
Other Charges and Other Adjustments 2
                               
Advanced Engineered Materials
    (14 )     (3 )     (36 )      
Consumer Specialties
    13       4       97       10  
Industrial Specialties
    6       (8 )     (19 )     (26 )
Acetyl Intermediates
    6       7       62       103  
Other Activities 1
    5       17       11       30  
     
Total
    16       17       115       117  
     
 
                               
Depreciation and Amortization Expense 3
                               
Advanced Engineered Materials
    19       19       72       72  
Consumer Specialties
    9       13       37       50  
Industrial Specialties
    10       11       41       46  
Acetyl Intermediates
    25       29       97       111  
Other Activities 1
    2       2       11       11  
     
Total
    65       74       258       290  
     
 
                               
Business Operating EBITDA
                               
Advanced Engineered Materials
    38       50       220       110  
Consumer Specialties
    81       64       298       291  
Industrial Specialties
    27       19       111       109  
Acetyl Intermediates
    125       108       402       306  
Other Activities 1
    (52 )     (41 )     (157 )     (119 )
     
Total
    219       200       874       697  
     
 
                               
Equity Earnings, Cost — Dividend Income and Other Income (Expense)
                               
Advanced Engineered Materials
    30       18       143       76  
Consumer Specialties
    (1 )     1       73       57  
Industrial Specialties
                       
Acetyl Intermediates
    2       3       9       9  
Other Activities 1
    12       6       23       18  
     
Total
    43       28       248       160  
     
 
                               
Operating EBITDA
                               
Advanced Engineered Materials
    68       68       363       186  
Consumer Specialties
    80       65       371       348  
Industrial Specialties
    27       19       111       109  
Acetyl Intermediates
    127       111       411       315  
Other Activities 1
    (40 )     (35 )     (134 )     (101 )
     
Total
    262       228       1,122       857  
     
1   Other Activities primarily includes corporate selling, general and administrative expenses and the results from captive insurance companies.
 
2   See Table 7 for details.
 
3   Excludes accelerated depreciation and amortization associated with plant closures included in Other Charges and Other Adjustments above. See Table 1A for details.
 
4   The company’s Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes.


 

Page 11 of 16
Table 1A

Reconciliation of consolidated Operating EBITDA to net earnings (loss) — Unaudited
                                 
    Three Months Ended   Twelve Months Ended
    December 31,   December 31,
(in $ millions)   2010   2009   2010   2009
     
            As adjusted3           As adjusted3
Net earnings (loss) attributable to Celanese Corporation
    56       6       375       498  
(Earnings) loss from discontinued operations
    45       (4 )     49       (4 )
Interest income
    (5 )     (1 )     (7 )     (8 )
Interest expense
    58       51       204       207  
Refinancing expense
                16        
Income tax provision (benefit)
    27       85       112       (243 )
Depreciation and amortization expense2
    65       74       258       290  
Other charges (gains), net 1
    1       13       48       136  
Other adjustments 1
    15       4       67       (19 )
     
Operating EBITDA
    262       228       1,122       857  
     
 
                               
Detail by Segment
                               
Advanced Engineered Materials
    68       68       363       186  
Consumer Specialties
    80       65       371       348  
Industrial Specialties
    27       19       111       109  
Acetyl Intermediates
    127       111       411       315  
Other Activities 4
    (40 )     (35 )     (134 )     (101 )
     
Operating EBITDA
    262       228       1,122       857  
     
1   See Table 7 for details.
 
2   Excludes accelerated depreciation and amortization associated with plant closures as detailed in the table below and included in Other adjustments above.
 
3   The company’s Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes.
                                 
    Three Months Ended   Twelve Months Ended
    December 31,   December 31,
(in $ millions)   2010   2009   2010   2009
     
Advanced Engineered Materials
          1       4       1  
Consumer Specialties
    4             5        
Industrial Specialties
          (1 )           5  
Acetyl Intermediates
          1       20       12  
Other Activities 4
    (1 )                  
     
Accelerated depreciation and amortization
    3       1       29       18  
     
 
                               
Depreciation and amortization expense2
    65       74       258       290  
     
Total depreciation and amortization
    68       75       287       308  
     
4   Other Activities primarily includes corporate selling, general and administrative expenses and the results from captive insurance companies.

 


 

Page 12 of 16
Table 2

Factors Affecting Business Segment Net Sales — Unaudited
Three Months Ended December 31, 2010 Compared to Three Months Ended December 31, 2009
                                         
    Volume   Price   Currency   Other   Total
 
Advanced Engineered Materials
    10 %     5 %     -5 %     5 %2     15 %
Consumer Specialties
    5 %     1 %     -1 %     0 %     5 %
Industrial Specialties
    4 %     9 %     -4 %     0 %     9 %
Acetyl Intermediates
    3 %     8 %     -3 %     0 %     8 %
Total Company
    5 %     7 %     -3 %     0 %1     9 %
 
Twelve Months Ended December 31, 2010 Compared to Twelve Months Ended December 31, 2009
                                         
    Volume   Price   Currency   Other   Total
 
Advanced Engineered Materials
    35 %     1 %     -3 %     4 %2     37 %
Consumer Specialties
    2 %     0 %     -1 %     0 %     1 %
Industrial Specialties
    11 %     6 %     -3 %     -8 %3     6 %
Acetyl Intermediates
    10 %     10 %     -2 %     0 %     18 %
Total Company
    13 %     7 %     -2 %     -2 %1     16 %
 
1   Includes the effects of the captive insurance companies and the impact of fluctuations in intersegment eliminations.
 
2   2010 includes the effects of the FACT GmbH (Future Advanced Composites Technology) and DuPont acquisitions.
 
3   2010 does not include the effects of the PVOH business, which was sold on July 1, 2009.
Table 3
Cash Flow Information — Unaudited
                 
    Twelve Months Ended
    December 31,
(in $ millions)   2010   2009
 
Net cash provided by operating activities
    452       596  
Net cash provided by (used in) investing activities 1
    (560 )     31  
Net cash used in financing activities
    (388 )     (112 )
Exchange rate effects on cash
    (18 )     63  
Cash and cash equivalents at beginning of period
    1,254       676  
 
Cash and cash equivalents at end of period
    740       1,254  
 
1   2010 includes $0 million of cash received and $312 million of capital expenditures related to the Ticona Kelsterbach plant relocation. 2009 includes $412 million of cash received and $351 million of capital expenditures related to the Ticona Kelsterbach plant relocation.
Table 4
Cash Dividends Received — Unaudited
                                 
    Three Months Ended   Twelve Months Ended
    December 31,   December 31,
(in $ millions)   2010   2009   2010   2009
     
            As Adjusted1           As Adjusted1
Dividends from equity investments
    18       23       138       78  
Dividends from cost investments
                73       57  
     
Total
    18       23       211       135  
     
1   The company’s Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes.

 


 

Page 13 of 16
Table 5

Net Debt — Reconciliation of a Non-U.S. GAAP Measure — Unaudited
                 
    December 31,   December 31,
(in $ millions)   2010   2009
 
Short-term borrowings and current installments of long-term debt — third party and affiliates
    228       242  
Long-term debt
    2,990       3,259  
 
Total debt
    3,218       3,501  
Less: Cash and cash equivalents
    740       1,254  
 
Net Debt
    2,478       2,247  
 
Table 6
Adjusted Earnings (Loss) Per Share — Reconciliation of a Non-U.S. GAAP Measure — Unaudited
                                                                 
    Three Months Ended   Twelve Months Ended
    December 31,   December 31,
(in $ millions, except per share data)   2010   2009   2010   2009
     
                    As Adjusted5                   As Adjusted5
            per           per           per           per
            share           share           share           share
Earnings (loss) from continuing operations
    101       0.64       2       0.00       424       2.68       494       3.14  
Deduct Income tax (provision) benefit
    (27 )             (85 )             (112 )             243          
     
Earnings (loss) from continuing operations before tax
    128               87               536               251          
Other charges and other adjustments 1
    16               17               115               117          
Refinancing expense2
                                16                        
     
Adjusted earnings (loss) from continuing operations before tax
    144               104               667               368          
Income tax (provision) benefit on adjusted earnings 3
    (29 )             (24 )             (133 )             (93 )        
Less: Noncontrolling interests
                                                       
     
Adjusted earnings (loss) from continuing operations
    115       0.73       80       0.51       534       3.37       275       1.75  
     
 
                                                               
Diluted shares (in millions) 4
                                                               
     
Weighted average shares outstanding
            155.7               144.1               154.6               143.7  
Assumed conversion of preferred stock
                          12.1               1.6               12.1  
Dilutive restricted stock units
            0.6               0.3               0.4               0.2  
Dilutive stock options
            2.0               1.9               1.8               1.1  
     
Total diluted shares
            158.3               158.4               158.4               157.1  
     
1   See Table 7 for details.
 
2   Relates to the issuance of senior unsecured notes and the amendment and extension of the existing credit agreement.
 
3   The adjusted effective tax rate is 20% for the three and twelve months ended December 31, 2010. The adjusted effective tax rate is 29% for the six months ended June 30, 2009 and 23% for the six months ended December 31, 2009.
 
4   Potentially dilutive shares are included in the adjusted earnings per share calculation when adjusted earnings are positive.
 
5   The company’s Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes.

 


 

Page 14 of 16
Table 7
Reconciliation of Other Charges and Other Adjustments — Unaudited
Other Charges:
                                   
    Three Months Ended   Twelve Months Ended  
    December 31,   December 31,  
(in $ millions)   2010   2009   2010   2009  
       
Employee termination benefits
    6       11       32       105    
Plant/office closures
          (3 )     4       17    
Ticona Kelsterbach plant relocation
    9       6       26       16    
Plumbing actions
    (17 )     (7 )     (57 )     (10 )  
Asset impairments
    1       6       74       14    
Insurance recoveries
                (18 )     (6 )  
Resolution of commercial disputes
    2             (13 )        
       
Total
    1       13       48       136    
       
Other Adjustments: 1
                                     
    Three Months Ended   Twelve Months Ended   Income
    December 31,   December 31,   Statement
(in $ millions)   2010   2009   2010   2009   Classification
     
Business optimization
    6       4       16       7     Cost of sales / SG&A
Ticona Kelsterbach plant relocation
    (6 )     (3 )     (13 )         Cost of sales
Plant closures
    3       9       17       25     Cost of sales / SG&A
Contract termination
                22           Cost of sales
(Gain) loss on disposition of assets
    5             (10 )         (Gain) loss on disposition
(Gain) on sale of PVOH business
                      (34 )   (Gain) loss on disposition
Write-off of other productive assets
    1             18           Cost of sales
Other2
    6       (6 )     17       (17 )   Various
         
Total
    15       4       67       (19 )    
         
 
                                   
Total other charges and other adjustments
    16       17       115       117      
         
1   These items are included in net earnings but not included in other charges.
 
2   The twelve months ended December 31, 2009 includes a one-time adjustment to Equity in net earnings (loss) of affiliates of $19 million.


 

Page 15 of 16

Table 8
Equity Affiliate Preliminary Results — Total — Unaudited
                                 
    Three Months Ended   Twelve Months Ended
    December 31,   December 31,
(in $ millions)   2010   2009   2010 2009
            As Adjusted5           As Adjusted5
 
                               
Net Sales
                               
Ticona Affiliates — Asia1
    400       344       1,543       1,105  
Ticona Affiliates — Middle East2
    205       203       923       630  
Infraserv Affiliates3
    579       642       2,070       2,186  
     
Total
    1,184       1,189       4,536       3,921  
     
Operating Profit
                               
Ticona Affiliates — Asia1
    43       23       222       58  
Ticona Affiliates — Middle East2
    84       87       400       253  
Infraserv Affiliates3
    31       16       101       103  
     
Total
    158       126       723       414  
     
Depreciation and Amortization
                               
Ticona Affiliates — Asia1
    22       21       85       87  
Ticona Affiliates — Middle East2
    8       11       33       31  
Infraserv Affiliates3
    26       28       101       103  
     
Total
    56       60       219       221  
     
Affiliate EBITDA4
                               
Ticona Affiliates — Asia1
    65       44       307       145  
Ticona Affiliates — Middle East2
    92       98       433       284  
Infraserv Affiliates3
    57       44       202       206  
     
Total
    214       186       942       635  
     
Net Income
                               
Ticona Affiliates — Asia1
    27             134       15  
Ticona Affiliates — Middle East2
    74       76       357       222  
Infraserv Affiliates3
    20       11       75       72  
     
Total
    121       87       566       309  
     
Net Debt
                               
Ticona Affiliates — Asia1
    53       131       53       131  
Ticona Affiliates — Middle East2
    (64 )     (39 )     (64 )     (39 )
Infraserv Affiliates3
    277       491       277       491  
     
Total
    266       583       266       583  
     
1   Ticona Affiliates — Asia accounted for using the equity method includes Polyplastics (45%), Korean Engineering Plastics (50%), Fortron Industries (50%), Una SA (50%).
 
2   Ticona Affiliates — Middle East accounted for using the equity method includes National Methanol Company (IBN Sina) (25%).
 
3   Infraserv Affiliates accounted for using the equity method includes Infraserv Hoechst (32%), Infraserv Gendorf (39%) and Infraserv Knapsack (27%).
 
4   Affiliate EBITDA, a non-U.S. GAAP measure, is the sum of Operating Profit and Depreciation and Amortization.
 
5   The company’s Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes.


 

Page 16 of 16

Table 8 (continued)
Equity Affiliate Preliminary Results — Celanese Proportional Share — Unaudited5
                                 
    Three Months Ended   Twelve Months Ended
    December 31,   December 31,
(in $ millions)   2010   2009   2010   2009
    As Adjusted8           As Adjusted8
Proportional Net Sales
                               
Ticona Affiliates — Asia1
    185       159       713       510  
Ticona Affiliates — Middle East2
    51       50       231       157  
Infraserv Affiliates3
    190       210       679       707  
     
Total
    426       419       1,623       1,374  
     
Proportional Operating Profit
                               
Ticona Affiliates — Asia1
    20       11       103       28  
Ticona Affiliates — Middle East2
    21       22       100       63  
Infraserv Affiliates3
    11       6       33       33  
     
Total
    52       39       236       124  
     
Proportional Depreciation and Amortization
                               
Ticona Affiliates — Asia1
    10       10       39       40  
Ticona Affiliates — Middle East2
    2       3       8       8  
Infraserv Affiliates3
    8       9       33       33  
     
Total
    20       22       80       81  
     
Proportional Affiliate EBITDA4
                               
Ticona Affiliates — Asia1
    30       21       142       68  
Ticona Affiliates — Middle East2
    23       25       108       71  
Infraserv Affiliates3
    19       15       66       66  
     
Total
    72       61       316       205  
     
Equity in net earnings of affiliates (as reported on the Income Statement)
                               
Ticona Affiliates — Asia1, 7
    13             63       7  
Ticona Affiliates — Middle East2
    17       18       81       51  
Infraserv Affiliates3
    7       4       24       22  
     
Total
    37       22       168       80  
     
Proportional Affiliate EBITDA in excess of Equity in net earnings of affiliates6
                               
Ticona Affiliates — Asia1
    17       21       79       61  
Ticona Affiliates — Middle East2
    6       7       27       20  
Infraserv Affiliates3
    12       11       42       44  
     
Total
    35       39       148       125  
     
Proportional Net Debt
                               
Ticona Affiliates — Asia1
    23       58       23       58  
Ticona Affiliates — Middle East2
    (16 )     (10 )     (16 )     (10 )
Infraserv Affiliates3
    89       162       89       162  
     
Total
    96       210       96       210  
     
1   Ticona Affiliates — Asia accounted for using the equity method includes Polyplastics (45%), Korean Engineering Plastics (50%), Fortron Industries (50%), Una SA (50%).
 
2   Ticona Affiliates — Middle East accounted for using the equity method includes National Methanol Company (IBN Sina) (25%).
 
3   Infraserv Affiliates accounted for using the equity method includes Infraserv Hoechst (32%), Infraserv Gendorf (39%) and Infraserv Knapsack (27%).
 
4   Affiliate EBITDA, a non-U.S. GAAP measure, is the sum of Operating Profit and Depreciation and Amortization.
 
5   Calculated by multiplying each affiliate’s total share amount by Celanese’s respective ownership percentage, netted by reporting category.
 
6   Calculated as Affiliate EBITDA less Equity in net earnings of affiliates; not included in Celanese operating EBITDA.
 
7   The year ended December 31, 2009 excludes a one-time tax adjustment to Equity in net earnings of affiliates of $19 million.
 
8   The company’s Ibn Sina investment is now included in the Advanced Engineered Materials segment using the equity method of accounting. These results were previously reported in the Acetyl Intermediates segment using the cost method of accounting. Amounts have been retrospectively adjusted to reflect these changes.