Celanese Corporation (NYSE: CE), a global chemical and specialty
materials company, today reported full year 2023 GAAP diluted
earnings per share of $18.00 and adjusted earnings per share of
$8.92. The Company generated net sales of $10.9 billion in 2023, an
increase of 13 percent from the prior year, due to an increase in
volume of 23 percent reflecting the Mobility & Materials
(M&M) acquisition, partially offset by a decrease in price of
10 percent. Full year 2023 volume decreased by 2 percent, excluding
M&M, due to challenging demand and competitive dynamics across
most of the year. Celanese took actions to reduce costs and align
production and inventory levels with demand to report 2023
consolidated operating profit of $1.7 billion, adjusted EBIT of
$1.8 billion, and operating EBITDA of $2.4 billion, at margins of
15, 16, and 22 percent, respectively.
The difference between GAAP diluted earnings per share and
adjusted earnings per share in 2023 was due to Certain Items
totaling $114 million1 and a recorded income tax benefit of $790
million, primarily due to restructuring related to acquired
operations.
Celanese took actions in 2023 to maximize cash generation and
execute its deleveraging plan. As a result, the Company:
- Reduced working capital balances by $579 million, driven by a
$451 million reduction in inventory balances in 2023;
- Generated record operating cash flow of $1.9 billion and record
free cash flow of $1.3 billion in 2023; and
- Reduced debt by $995 million and increased cash by $297
million, resulting in a $1.3 billion reduction in net debt across
2023.
Celanese also reported fourth quarter GAAP diluted earnings per
share of $6.43 and adjusted earnings per share of $2.24. The
Company generated fourth quarter operating cash flow of $830
million and free cash flow of $702 million, both quarterly
records.
"In a challenging backdrop across the entirety of 2023, our team
decisively executed on hundreds of actions to reduce our costs,
secure alternative volumes, align our production and inventory
levels with demand, and maximize our cash generation," said Lori
Ryerkerk, chair and chief executive officer. "With a focus on what
we can control, we delivered record cash generation, exceeded our
full year net debt reduction objective, and enhanced the
competitiveness of our businesses going into 2024."
____________________________
1 Including the gain from the formation of
the Nutrinova joint venture (JV), partially offset by
M&A-related costs, and shutdown costs
Fourth Quarter 2023 Financial Highlights:
Three Months Ended
December 31,
2023
September 30,
2023
December 31,
2022
(unaudited)
(In $ millions, except per
share data)
Net Sales
Engineered Materials
1,406
1,528
1,237
Acetyl Chain
1,181
1,220
1,135
Intersegment Eliminations
(18
)
(25
)
(24
)
Total
2,569
2,723
2,348
Operating Profit (Loss)
Engineered Materials
122
691
25
Acetyl Chain
264
272
204
Other Activities
(127
)
(121
)
(173
)
Total
259
842
56
Net Earnings (Loss)
701
949
769
Adjusted EBIT(1)
Engineered Materials
199
229
138
Acetyl Chain
300
310
242
Other Activities
(65
)
(88
)
(78
)
Total
434
451
302
Equity Earnings and Dividend Income,
Other Income (Expense)
Engineered Materials
45
12
35
Acetyl Chain
33
33
30
Operating EBITDA(1)
608
624
453
Diluted EPS - continuing operations
$
6.43
$
8.70
$
7.03
Diluted EPS - total
$
6.37
$
8.69
$
7.03
Adjusted EPS(1)
$
2.24
$
2.50
$
1.44
Net cash provided by (used in) investing
activities
(168
)
375
(10,713
)
Net cash provided by (used in) financing
activities
(240
)
(700
)
1,944
Net cash provided by (used in) operating
activities
830
403
541
Free cash flow(1)
702
268
395
Year Ended December
31,
2023
2022
(unaudited)
(In $ millions, except per
share data)
Net Sales
Engineered Materials
6,149
4,024
Acetyl Chain
4,884
5,743
Intersegment Eliminations
(93
)
(94
)
Total
10,940
9,673
Operating Profit (Loss)
Engineered Materials
1,083
429
Acetyl Chain
1,109
1,447
Other Activities
(505
)
(498
)
Total
1,687
1,378
Net Earnings (Loss)
1,964
1,902
Adjusted EBIT(1)
Engineered Materials
848
779
Acetyl Chain
1,258
1,609
Other Activities
(353
)
(217
)
Total
1,753
2,171
Equity Earnings and Dividend Income,
Other Income (Expense)
Engineered Materials
87
207
Acetyl Chain
132
143
Operating EBITDA(1)
2,444
2,617
Diluted EPS - continuing operations
$
18.00
$
17.41
Diluted EPS - total
$
17.92
$
17.34
Adjusted EPS(1)
$
8.92
$
15.88
Net cash provided by (used in) investing
activities
(134
)
(11,141
)
Net cash provided by (used in) financing
activities
(1,456
)
10,290
Net cash provided by (used in) operating
activities
1,899
1,819
Free cash flow(1)
1,320
1,263
____________________________
(1)
See "Non-US GAAP Financial Measures"
below.
Recent Highlights:
- Commissioned the carbon capture and utilization (CCU) methanol
expansion at the Clear Lake, Texas site, which is expected to
capture 180 kt of CO2 industrial emissions and produce 130 kt of
low-carbon methanol per year.
- Completed the transition of M&M to the upgraded Celanese
SAP S/4HANA ERP system as the final step to fold the entire
organization onto one consolidated ERP system.
- Completed the planned closure of the Company's nylon 66 (PA66)
and certain high-performance nylon (HPN) polymerization units in
Uentrop, Germany. Polymerization costs at Uentrop were the highest
in the Celanese global nylon network due to energy and raw material
costs in the region.
- Announced a collaboration with Under Armour and development of
NEOLAST™, a new fiber for performance stretch fabrics that is a
recyclable alternative to spandex.
- Elected Ganesh Moorthy to the Company's Board of Directors in
October. Mr. Moorthy is President, Chief Executive Officer, and a
member of the Board of Directors of Microchip Technology
Incorporated.
Full Year 2023 and Fourth Quarter Business Segment
Overview
Acetyl Chain
The Acetyl Chain reported 2023 net sales of $4.9 billion, a 15
percent decrease from the prior year. Net sales reflected a 17
percent decrease in pricing partially offset by a 2 percent
increase in volume. The decrease in pricing resulted in an
approximately $1 billion headwind, driven by weak demand across
many end-markets and a challenging competitive environment. In
response, the business exercised its commercial flexibility across
the year to capture opportunistic volumes during periods of high
spot demand and industry production outages in China. The Acetyl
Chain demonstrated additional optionality by pivoting downstream to
sell incremental volume into acetate tow and redispersible powders
to capture stronger demand and margins. The business flexed its
global network to align production with demand by idling its
highest cost facilities. Based on these actions, the Acetyl Chain
was able to offset the majority of pricing headwinds to deliver
foundational earnings in 2023. The Acetyl Chain generated GAAP
operating profit of $1.1 billion, adjusted EBIT of $1.3 billion,
and operating EBITDA of $1.5 billion, at margins of 23, 26, and 30
percent, respectively.
The Acetyl Chain delivered fourth quarter net sales of $1.2
billion due to a 3 percent sequential decrease in pricing and
consistent volume. The business faced unanticipated operational
disruptions in the quarter including unscheduled maintenance and
supplier disruptions that resulted in over 50 kt of lost production
at its most cost-advantaged facilities. To avoid any impact to its
customers, the Acetyl Chain incurred additional costs from flexing
production to higher cost plants in its network and sourcing volume
from third parties. Despite these challenges, the Acetyl Chain
delivered its second highest-ever earnings for a fourth quarter
with GAAP operating profit of $264 million, adjusted EBIT of $300
million, and operating EBITDA of $354 million, at margins of 22,
25, and 30 percent, respectively. The business delivered fourth
quarter performance consistent with its foundational earnings power
of $1.3 billion in annual adjusted EBIT, a level of earnings which
is expected to increase by approximately $100 million annually
after completion of the Clear Lake acetic acid expansion.
Engineered Materials
Engineered Materials delivered net sales of $6.1 billion in
2023, a 53 percent increase from the prior year as a result of the
M&M acquisition that closed in the fourth quarter of 2022. The
business faced challenging demand and competitive conditions
throughout the year, which resulted in volume and pricing
decreases. Excluding the addition of M&M, Engineered Materials
volume decreased by 8 percent from the prior year. The impact of
demand weakness and prolonged destocking in many end-markets was
partially offset by growth in automotive and medical markets and
alternative volume secured in other markets. A deflationary raw
material environment, weak demand, and heightened competitive
dynamics resulted in negative impacts to pricing. The business
responded to these challenges by aligning inventory and production
levels to demand, lowering inventory balances by $384 million
across the year, and accelerating M&M synergy actions.
Engineered Materials delivered 2023 GAAP operating profit of $1.1
billion, adjusted EBIT of $848 million, and operating EBITDA of
$1.3 billion, at margins of 18, 14, and 21 percent,
respectively.
Engineered Materials reported fourth quarter net sales of $1.4
billion, representing a sequential decrease of 8 percent. Net sales
reflected a volume decrease of 5 percent and a pricing decrease of
3 percent. Pricing decreased due to continued challenging
competitive dynamics and product mix headwinds in the Americas and
Europe. Volume was impacted, particularly in the acquired M&M
product lines, by year-end destocking in automotive and
distribution in the Western Hemisphere that was partially offset by
improvement in Asia. Engineered Materials reported fourth quarter
GAAP operating profit of $122 million, adjusted EBIT of $199
million, and operating EBITDA of $311 million at margins of 9, 14,
and 22 percent, respectively. The formation of the Nutrinova JV
resulted in a $13 million sequential decrease in consolidated
Engineered Materials earnings.
Cash Flow and Tax
Celanese reported 2023 operating cash flow of $1.9 billion and
free cash flow of $1.3 billion which included capital expenditures
of $568 million. Celanese returned $305 million in cash to
shareholders via dividends in 2023.
The tax rate for U.S. GAAP purposes was a benefit of 67 percent
for full year 2023 due to deferred tax benefits of non-recurring
internal reorganization transactions to integrate acquired business
operations and to centralize ownership of intellectual property
with the business, the integration of the European headquarters and
principal operations to Switzerland, the release of valuation
allowances on U.S. foreign tax credit carryforwards, and excess of
U.S. GAAP book gains over tax gains related to the formation of the
Nutrinova JV. The effective tax rate for adjusted earnings was 9
percent for 2023 as certain benefits of the internal restructuring
will be realized in future periods.
Outlook
"Early signs of demand improvement in certain products and
end-markets are insufficient to improve the overall sequential
backdrop we see early in 2024 and we remain focused on what we can
control to sustainably lift the earnings power of Celanese," said
Lori Ryerkerk. "We expect to complete several major value creation
projects in the first quarter which, along with future projects,
will support a significant ramp in our earnings performance across
the year. We expect to deliver a significant year over year
increase in our earnings per share supported by M&M synergy
capture, the Clear Lake acetic acid and methanol expansions, lower
interest expense due to deleveraging, and recognition of lower
costs flowing through our inventory."
Reflective of sequential volume and pricing conditions that are
not expected to materially improve to start 2024, the timing of
major value creation projects, and significant first quarter costs
related to planned outages, the Company anticipates first quarter
adjusted earnings per share of $1.75 to $2.00, inclusive of
approximately $0.30 per share of M&M transaction
amortization.
Reconciliations of forecasted non-GAAP measures such as adjusted
earnings per share, adjusted EBIT or free cash flow to the
equivalent U.S. GAAP measures (diluted earnings per share, net
earnings (loss) attributable to Celanese Corporation and net cash
provided by (used in) operations, respectively), are not available
without unreasonable efforts because a forecast of Certain Items,
such as mark-to-market pension gains/losses, and other items is not
practical. For more information, see "Non-GAAP Financial Measures"
below.
The Company's prepared remarks related to the fourth quarter
will be posted on its website at investors.celanese.com under
Financial Information/Financial Document Library on February 20,
2024. Information about Non-US GAAP measures is included in a
Non-US GAAP Financial Measures and Supplemental Information
document posted on our investor relations website under Financial
Information/Non-GAAP Financial Measures. See also "Non-GAAP
Financial Measures" below.
Celanese Corporation is a global chemical leader in the
production of differentiated chemistry solutions and specialty
materials used in most major industries and consumer applications.
Our businesses use the full breadth of Celanese's global chemistry,
technology and commercial expertise to create value for our
customers, employees, shareholders and the corporation. As we
partner with our customers to solve their most critical business
needs, we strive to make a positive impact on our communities and
the world through The Celanese Foundation. Based in Dallas,
Celanese employs approximately 12,400 employees worldwide and had
2023 net sales of $10.9 billion. For more information about
Celanese Corporation and its 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, cash flow, financial
performance, synergies, 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
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 product and industry business
cycles, particularly in the automotive, electrical, textiles,
electronics and construction industries; volatility or changes in
the price and availability of raw materials and energy,
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, logistics costs
and other costs on to customers or otherwise improve margins
through price increases; the possibility that we will not be able
to timely or effectively continue to integrate the Mobility &
Materials business (the "M&M Business") we acquired from DuPont
de Nemours, Inc. (the "M&M Acquisition") in order to realize
the anticipated benefits of the M&M Acquisition, including
synergies and growth opportunities, whether as a result of
difficulties arising from the operation of the M&M Business or
other unanticipated delays, costs, inefficiencies or liabilities;
increased commercial, legal or regulatory complexity of entering
into, or expanding our exposure to, certain end markets and
geographies; risks in the global economy and equity and credit
markets and their potential impact on our ability to pay down debt
in the future and/or refinance at suitable rates, in a timely
manner, or at all; risks and costs associated with increased
leverage from the M&M Acquisition, including increased interest
expense and potential reduction of business and strategic
flexibility; the ability to maintain plant utilization rates and to
implement planned capacity additions, expansions and maintenance;
the ability to reduce or maintain current levels of production
costs and to improve productivity by implementing technological
improvements to existing plants; increased price competition and
the introduction of competing products by other companies; the
ability to identify desirable potential acquisition or divestiture
opportunities and to complete such transactions, including
obtaining regulatory approvals, consistent with the Company's
strategy; market acceptance of our products and technology;
compliance and other costs and potential disruption or interruption
of production or operations due to accidents, interruptions in
sources of raw materials, transportation, logistics or supply chain
disruptions, cybersecurity incidents, terrorism or political
unrest, public health crises (including, but not limited to, the
COVID-19 pandemic), or other unforeseen events or delays in
construction or operation of facilities, including as a result of
geopolitical conditions, the direct or indirect consequences of
acts of war or conflict (such as the Russia-Ukraine conflict or the
Israel-Hamas conflict) or terrorist incidents or as a result of
weather, natural disasters, or other crises; the ability to obtain
governmental approvals and to construct facilities on terms and
schedules acceptable to the Company; changes in applicable tariffs,
duties and trade agreements, tax rates or legislation throughout
the world including, but not limited to, adjustments, changes in
estimates or interpretations or the resolution of tax examinations
or audits that may impact recorded or future tax impacts and
potential regulatory and legislative tax developments in the United
States and other jurisdictions; 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 or other
sustainability matters; potential liability resulting from pending
or future claims or litigation, including investigations or
enforcement actions, 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; 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.
Non-GAAP Financial Measures
Presentation
This document presents the Company's two business segments,
Engineered Materials and the Acetyl Chain.
Use of Non-US GAAP Financial Information
This release uses the following Non-US GAAP measures: adjusted
EBIT, adjusted EBIT margin, operating EBITDA, operating EBITDA
margin, adjusted earnings per share and free cash flow. These
measures are not recognized in accordance with US GAAP and should
not be viewed as an alternative to US GAAP measures of performance
or liquidity. 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 is operating margin; for operating EBITDA margin is
operating margin; for adjusted earnings per share is earnings
(loss) from continuing operations attributable to Celanese
Corporation per common share-diluted; and for free cash flow is net
cash provided by (used in) operations.
Definitions of Non-US GAAP Financial Measures
- 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 of our Non-US GAAP Financial Measures and
Supplemental Information document). 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.
- 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.
Operating EBITDA margin is defined by the Company as operating
EBITDA divided by net sales.
- 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 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 of
our Non-US GAAP Financial Measures and Supplemental Information
document 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 contributions from or distributions to
our noncontrolling interest joint ventures. We do not provide
reconciliations for free cash flow 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 items such as working capital
changes, fluctuations in foreign currency exchange rates, the
impact and timing of potential acquisitions and divestitures, and
other structural changes, 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.
Reconciliation of Non-US GAAP Financial Measures
Reconciliations of the Non-US GAAP financial measures used in
this press release to the comparable US GAAP financial measure,
together with information about the purposes and uses of Non-US
GAAP financial measures, are included in our Non-US GAAP Financial
Measures and Supplemental Information document filed as an exhibit
to our Current Report on Form 8-K filed with the SEC on or about
February 20, 2024 and also available on our website at
investors.celanese.com under Financial Information/Financial
Document Library.
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.
Supplemental Information
Additional information about our prior period performance is
included in our Quarterly Reports on Form 10-Q and in our Non-US
GAAP Financial Measures and Supplemental Information document.
Consolidated Statements of Operations -
Unaudited
Three Months Ended
December 31,
2023
September 30,
2023
December 31,
2022
(In $ millions, except share
and per share data)
Net sales
2,569
2,723
2,348
Cost of sales
(1,956
)
(2,050
)
(1,964
)
Gross profit
613
673
384
Selling, general and administrative
expenses
(272
)
(244
)
(269
)
Amortization of intangible assets
(40
)
(41
)
(30
)
Research and development expenses
(32
)
(32
)
(37
)
Other (charges) gains, net
(18
)
(17
)
7
Foreign exchange gain (loss), net
11
—
3
Gain (loss) on disposition of businesses
and assets, net
(3
)
503
(2
)
Operating profit (loss)
259
842
56
Equity in net earnings (loss) of
affiliates
52
12
31
Non-operating pension and other
postretirement employee benefit (expense) income
(67
)
(1
)
(57
)
Interest expense
(178
)
(178
)
(168
)
Refinancing expense
—
(7
)
—
Interest income
12
12
33
Dividend income - equity investments
31
30
30
Other income (expense), net
23
4
5
Earnings (loss) from continuing operations
before tax
132
714
(70
)
Income tax (provision) benefit
575
236
840
Earnings (loss) from continuing
operations
707
950
770
Earnings (loss) from operation of
discontinued operations
(8
)
(1
)
(1
)
Income tax (provision) benefit from
discontinued operations
2
—
—
Earnings (loss) from discontinued
operations
(6
)
(1
)
(1
)
Net earnings (loss)
701
949
769
Net (earnings) loss attributable to
noncontrolling interests
(3
)
2
(2
)
Net earnings (loss) attributable to
Celanese Corporation
698
951
767
Amounts attributable to Celanese
Corporation
Earnings (loss) from continuing
operations
704
952
768
Earnings (loss) from discontinued
operations
(6
)
(1
)
(1
)
Net earnings (loss)
698
951
767
Earnings (loss) per common share -
basic
Continuing operations
6.46
8.74
7.08
Discontinued operations
(0.05
)
(0.01
)
(0.01
)
Net earnings (loss) - basic
6.41
8.73
7.07
Earnings (loss) per common share -
diluted
Continuing operations
6.43
8.70
7.03
Discontinued operations
(0.06
)
(0.01
)
—
Net earnings (loss) - diluted
6.37
8.69
7.03
Weighted average shares (in millions)
Basic
109.0
108.9
108.5
Diluted
109.5
109.4
109.2
Consolidated Statements of Operations -
Unaudited
Year Ended December
31,
2023
2022
(In $ millions, except share
and per share data)
Net sales
10,940
9,673
Cost of sales
(8,337
)
(7,293
)
Gross profit
2,603
2,380
Selling, general and administrative
expenses
(1,075
)
(824
)
Amortization of intangible assets
(164
)
(62
)
Research and development expenses
(146
)
(112
)
Other (charges) gains, net
(68
)
(8
)
Foreign exchange gain (loss), net
32
(1
)
Gain (loss) on disposition of businesses
and assets, net
505
5
Operating profit (loss)
1,687
1,378
Equity in net earnings (loss) of
affiliates
102
220
Non-operating pension and other
postretirement employee benefit (expense) income
(69
)
17
Interest expense
(720
)
(405
)
Refinancing expense
(7
)
—
Interest income
39
69
Dividend income - equity investments
126
133
Other income (expense), net
25
9
Earnings (loss) from continuing operations
before tax
1,183
1,421
Income tax (provision) benefit
790
489
Earnings (loss) from continuing
operations
1,973
1,910
Earnings (loss) from operation of
discontinued operations
(12
)
(9
)
Income tax (provision) benefit from
discontinued operations
3
1
Earnings (loss) from discontinued
operations
(9
)
(8
)
Net earnings (loss)
1,964
1,902
Net (earnings) loss attributable to
noncontrolling interests
(4
)
(8
)
Net earnings (loss) attributable to
Celanese Corporation
1,960
1,894
Amounts attributable to Celanese
Corporation
Earnings (loss) from continuing
operations
1,969
1,902
Earnings (loss) from discontinued
operations
(9
)
(8
)
Net earnings (loss)
1,960
1,894
Earnings (loss) per common share -
basic
Continuing operations
18.09
17.55
Discontinued operations
(0.08
)
(0.07
)
Net earnings (loss) - basic
18.01
17.48
Earnings (loss) per common share -
diluted
Continuing operations
18.00
17.41
Discontinued operations
(0.08
)
(0.07
)
Net earnings (loss) - diluted
17.92
17.34
Weighted average shares (in millions)
Basic
108.8
108.4
Diluted
109.4
109.2
Consolidated Balance Sheets -
Unaudited
As of December 31,
2023
As of December 31,
2022
(In $ millions)
ASSETS
Current Assets
Cash and cash equivalents
1,805
1,508
Trade receivables - third party and
affiliates, net
1,243
1,379
Non-trade receivables, net
541
675
Inventories
2,357
2,808
Other assets
272
241
Total current assets
6,218
6,611
Investments in affiliates
1,220
1,062
Property, plant and equipment, net
5,584
5,584
Operating lease right-of-use assets
422
413
Deferred income taxes
1,677
808
Other assets
524
547
Goodwill
6,977
7,142
Intangible assets, net
3,975
4,105
Total assets
26,597
26,272
LIABILITIES AND EQUITY
Current Liabilities
Short-term borrowings and current
installments of long-term debt - third party and affiliates
1,383
1,306
Trade payables - third party and
affiliates
1,510
1,518
Other liabilities
1,154
1,201
Income taxes payable
25
43
Total current liabilities
4,072
4,068
Long-term debt, net of unamortized
deferred financing costs
12,301
13,373
Deferred income taxes
999
1,242
Uncertain tax positions
300
322
Benefit obligations
457
411
Operating lease liabilities
325
364
Other liabilities
591
387
Commitments and Contingencies
Stockholders' Equity
Treasury stock, at cost
(5,488
)
(5,491
)
Additional paid-in capital
394
372
Retained earnings
12,929
11,274
Accumulated other comprehensive income
(loss), net
(744
)
(518
)
Total Celanese Corporation stockholders'
equity
7,091
5,637
Noncontrolling interests
461
468
Total equity
7,552
6,105
Total liabilities and equity
26,597
26,272
Non-US GAAP Financial
Measures and Supplemental Information
February 20, 2024
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 two business segments,
Engineered Materials and the 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 contributions from or distributions to
our NCI joint ventures. 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. Free
cash flow is not a measure of cash available for discretionary
expenditures since the Company has certain debt service and finance
lease payments that are not deducted from that measure. We do not
provide reconciliations for free cash flow on a forward-looking
basis 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 items
such as working capital changes, fluctuations in foreign currency
exchange rates, the impact and timing of potential acquisitions and
divestitures, and other structural changes, 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.
- 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. Amounts referred to as
"attributable to Celanese Corporation" are net of any applicable
NCI.
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.
Table 1
Celanese Adjusted EBIT and Operating
EBITDA - Reconciliation of Non-GAAP Measures - Unaudited
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
2022
Q4 '22
Q3 '22
Q2 '22
Q1 '22
(In $ millions)
Net earnings (loss) attributable to
Celanese Corporation
1,960
698
951
220
91
1,894
767
191
434
502
(Earnings) loss from discontinued
operations
9
6
1
(1
)
3
8
1
1
6
—
Interest income
(39
)
(12
)
(12
)
(7
)
(8
)
(69
)
(33
)
(34
)
(1
)
(1
)
Interest expense
720
178
178
182
182
405
168
154
48
35
Refinancing expense
7
—
7
—
—
—
—
—
—
—
Income tax provision (benefit)
(790
)
(575
)
(236
)
(4
)
25
(489
)
(840
)
127
112
112
Certain Items attributable to Celanese
Corporation (Table 8)
(114
)
139
(438
)
54
131
422
239
71
47
65
Adjusted EBIT
1,753
434
451
444
424
2,171
302
510
646
713
Depreciation and amortization
expense(1)
691
174
173
172
172
446
151
97
98
100
Operating EBITDA
2,444
608
624
616
596
2,617
453
607
744
813
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
2022
Q4 '22
Q3 '22
Q2 '22
Q1 '22
(In $ millions)
Engineered Materials
15
15
—
—
—
13
2
3
4
4
Acetyl Chain
—
—
—
—
—
2
—
—
—
2
Other Activities(2)
—
—
—
—
—
1
—
—
1
—
Accelerated depreciation and
amortization expense
15
15
—
—
—
16
2
3
5
6
Depreciation and amortization
expense(1)
691
174
173
172
172
446
151
97
98
100
Total depreciation and amortization
expense
706
189
173
172
172
462
153
100
103
106
______________________________
(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, 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 1a
M&M Adjusted EBIT and Operating
EBITDA - Reconciliation of Non-GAAP Measures - Unaudited
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
Q4 '22
(In $ millions)
Net earnings (loss) attributable to
M&M
24
(22
)
47
47
(48
)
(69
)
(3)
Income tax provision (benefit)
65
43
10
(1
)
13
6
Certain Items(1)
151
30
17
18
86
72
Adjusted EBIT
240
51
74
64
51
9
Depreciation and amortization expense
275
69
70
68
68
47
Operating EBITDA(2)
515
120
144
132
119
56
(4)
______________________________
(1)
Amount is included within total Certain
Items shown in Table 8.
(2)
Excludes $(22) million, $(19) million,
$(23) million, $(23) million and $(17) million of Operating EBITDA
included in Other Activities for the three months ended December
31, 2023, September 30, 2023, June 30, 2023, March 31, 2023 and
December 31, 2022, respectively.
(3)
Excludes $30 million of Net loss for the
month ended October 31, 2022, prior to our acquisition of the
majority of the Mobility & Materials business ("M&M
Business") of DuPont de Nemours, Inc.
(4)
Excludes $22 million of Operating EBITDA
for the month ended October 31, 2022, prior to our acquisition of
the M&M Business.
Table 2 - Supplemental Segment Data and
Reconciliation of Segment Adjusted EBIT and Operating EBITDA -
Non-GAAP Measures - Unaudited
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
2022
Q4 '22
Q3 '22
Q2 '22
Q1 '22
(In $ millions, except
percentages)
Operating Profit (Loss) / Operating
Margin
Engineered Materials
1,083
17.6
%
122
8.7
%
691
45.2
%
158
10.0
%
112
6.9
%
429
10.7
%
25
2.0
%
114
12.3
%
166
17.5
%
124
13.6
%
Acetyl Chain
1,109
22.7
%
264
22.4
%
272
22.3
%
295
23.9
%
278
22.2
%
1,447
25.2
%
204
18.0
%
312
22.3
%
428
27.5
%
503
30.4
%
Other Activities(1)
(505
)
(127
)
(121
)
(118
)
(139
)
(498
)
(173
)
(118
)
(111
)
(96
)
Total
1,687
15.4
%
259
10.1
%
842
30.9
%
335
12.0
%
251
8.8
%
1,378
14.2
%
56
2.4
%
308
13.4
%
483
19.4
%
531
20.9
%
Less: Net Earnings (Loss) Attributable to
NCI for Engineered Materials
(3
)
1
(2
)
(2
)
—
—
—
—
—
—
Less: Net Earnings (Loss) Attributable to
NCI for Acetyl Chain
7
2
—
3
2
8
2
2
2
2
Operating Profit (Loss) Attributable to
Celanese Corporation
1,683
15.4
%
256
10.0
%
844
31.0
%
334
11.9
%
249
8.7
%
1,370
14.2
%
54
2.3
%
306
13.3
%
481
19.3
%
529
20.8
%
Operating Profit (Loss) / Operating
Margin Attributable to Celanese Corporation
Engineered Materials
1,086
17.7
%
121
8.6
%
693
45.4
%
160
10.1
%
112
6.9
%
429
10.7
%
25
2.0
%
114
12.3
%
166
17.5
%
124
13.6
%
Acetyl Chain
1,102
22.6
%
262
22.2
%
272
22.3
%
292
23.7
%
276
22.1
%
1,439
25.1
%
202
17.8
%
310
22.2
%
426
27.3
%
501
30.3
%
Other Activities(1)
(505
)
(127
)
(121
)
(118
)
(139
)
(498
)
(173
)
(118
)
(111
)
(96
)
Total
1,683
15.4
%
256
10.0
%
844
31.0
%
334
11.9
%
249
8.7
%
1,370
14.2
%
54
2.3
%
306
13.3
%
481
19.3
%
529
20.8
%
Equity Earnings and Dividend Income,
Other Income (Expense) Attributable to Celanese Corporation
Engineered Materials
87
45
12
20
10
207
35
70
53
49
Acetyl Chain
132
33
33
32
34
143
30
34
39
40
Other Activities(1)
34
28
1
6
(1
)
12
1
4
1
6
Total
253
106
46
58
43
362
66
108
93
95
Non-Operating Pension and Other
Post-Retirement Employee Benefit (Expense) Income Attributable to
Celanese Corporation
Engineered Materials
(1
)
(1
)
—
—
—
—
—
—
—
—
Acetyl Chain
—
—
—
—
—
—
—
—
—
—
Other Activities(1)
(68
)
(66
)
(1
)
(2
)
1
17
(57
)
25
25
24
Total
(69
)
(67
)
(1
)
(2
)
1
17
(57
)
25
25
24
Certain Items Attributable to Celanese
Corporation (Table 8)
Engineered Materials
(324
)
34
(476
)
25
93
143
78
22
5
38
Acetyl Chain
24
5
5
8
6
27
10
5
10
2
Other Activities(1)
186
100
33
21
32
252
151
44
32
25
Total
(114
)
139
(438
)
54
131
422
239
71
47
65
Adjusted EBIT / Adjusted EBIT
Margin
Engineered Materials
848
13.8
%
199
14.2
%
229
15.0
%
205
12.9
%
215
13.2
%
779
19.4
%
138
11.2
%
206
22.2
%
224
23.6
%
211
23.2
%
Acetyl Chain
1,258
25.8
%
300
25.4
%
310
25.4
%
332
26.9
%
316
25.3
%
1,609
28.0
%
242
21.3
%
349
25.0
%
475
30.5
%
543
32.9
%
Other Activities(1)
(353
)
(65
)
(88
)
(93
)
(107
)
(217
)
(78
)
(45
)
(53
)
(41
)
Total
1,753
16.0
%
434
16.9
%
451
16.6
%
444
15.9
%
424
14.9
%
2,171
22.4
%
302
12.9
%
510
22.2
%
646
26.0
%
713
28.1
%
___________________________
(1)
Other Activities includes corporate
SG&A expenses, 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.)
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
2022
Q4 '22
Q3 '22
Q2 '22
Q1 '22
(In $ millions, except
percentages)
Depreciation and Amortization
Expense(1)
Engineered Materials
447
112
111
112
112
213
90
40
41
42
Acetyl Chain
217
54
55
54
54
211
52
53
52
54
Other Activities(2)
27
8
7
6
6
22
9
4
5
4
Total
691
174
173
172
172
446
151
97
98
100
Operating EBITDA / Operating EBITDA
Margin
Engineered Materials
1,295
21.1
%
311
22.1
%
340
22.3
%
317
20.0
%
327
20.1
%
992
24.7
%
228
18.4
%
246
26.5
%
265
28.0
%
253
27.8
%
Acetyl Chain
1,475
30.2
%
354
30.0
%
365
29.9
%
386
31.3
%
370
29.6
%
1,820
31.7
%
294
25.9
%
402
28.8
%
527
33.8
%
597
36.1
%
Other Activities(2)
(326
)
(57
)
(81
)
(87
)
(101
)
(195
)
(69
)
(41
)
(48
)
(37
)
Total
2,444
22.3
%
608
23.7
%
624
22.9
%
616
22.0
%
596
20.9
%
2,617
27.1
%
453
19.3
%
607
26.4
%
744
29.9
%
813
32.0
%
___________________________
(1)
Excludes accelerated depreciation and
amortization expense, which amounts are included in Certain Items
above. See Table 1 for details.
(2)
Other Activities includes corporate
SG&A expenses, 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 3
Adjusted Earnings (Loss) per Share -
Reconciliation of a Non-GAAP Measure - Unaudited
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
2022
Q4 '22
Q3 '22
Q2 '22
Q1 '22
per share
per share
per share
per share
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
1,969
18.00
704
6.43
952
8.70
219
2.00
94
0.86
1,902
17.41
768
7.03
192
1.76
440
4.03
502
4.61
Income tax provision (benefit)
(790
)
(575
)
(236
)
(4
)
25
(489
)
(840
)
127
112
112
Earnings (loss) from continuing operations
before tax
1,179
129
716
215
119
1,413
(72
)
319
552
614
Certain Items attributable to Celanese
Corporation (Table 8)
(114
)
139
(438
)
54
131
422
239
71
47
65
Refinancing and related expenses
7
—
7
—
—
158
(1)
14
(1)
104
(1)
26
(1)
14
(1)
Adjusted earnings (loss) from continuing
operations before tax
1,072
268
285
269
250
1,993
181
494
625
693
Income tax (provision) benefit on adjusted
earnings(2)
(96
)
(23
)
(11
)
(32
)
(30
)
(259
)
(24
)
(64
)
(81
)
(90
)
Adjusted earnings (loss) from
continuing operations(3)
976
8.92
245
2.24
274
2.50
237
2.17
220
2.01
1,734
15.88
157
1.44
430
3.94
544
4.99
603
5.54
Diluted shares (in
millions)(4)
Weighted average shares outstanding
108.8
109.0
108.9
108.9
108.6
108.4
108.5
108.4
108.4
108.2
Incremental shares attributable to equity
awards
0.6
0.5
0.5
0.4
0.6
0.8
0.7
0.7
0.7
0.7
Total diluted shares
109.4
109.5
109.4
109.3
109.2
109.2
109.2
109.1
109.1
108.9
______________________________
(1)
Includes net interest expense and certain
fees related to debt issued as part of our acquisition of the
M&M Business.
(2)
Calculated using adjusted effective tax
rates (Table 3a) as follows:
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
2022
Q4 '22
Q3 '22
Q2 '22
Q1 '22
Adjusted effective tax rate
9
9
4
12
12
13
13
13
13
13
(3)
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)
Q4 '23 & 2023
8.1
5.2
Q4 '22 & 2022
(18.4
)
5.4
(4)
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
Actual
2023
2022
(In percentages)
US GAAP annual effective tax rate
(67
)
(34
)
Discrete quarterly recognition of GAAP
items(1)
2
(6
)
Tax impact of other charges and
adjustments(2)
(3
)
9
Changes in valuation allowances, excluding
impact of other charges and adjustments(3)
13
(1
)
Other, includes effect of discrete current
year transactions(4)(5)
64
45
Adjusted tax rate
9
13
______________________________
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)
Includes tax impacts related to full-year
actual tax opportunities and related costs.
(5)
Includes the reversal of certain U.S. GAAP
deferred tax benefits related to non-recurring internal
restructuring transactions related to the M&M acquisition, to
centralize ownership of intellectual property with the business and
to facilitate future deployment of cash to service acquisition
indebtedness. Certain benefits of the internal restructuring will
be realized in future periods for adjusted earnings purposes.
Table 4
Net Sales by Segment -
Unaudited
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
2022
Q4 '22
Q3 '22
Q2 '22
Q1 '22
(In $ millions)
Engineered Materials
6,149
1,406
1,528
1,585
1,630
4,024
1,237
929
948
910
Acetyl Chain
4,884
1,181
1,220
1,233
1,250
5,743
1,135
1,397
1,559
1,652
Intersegment eliminations(1)
(93
)
(18
)
(25
)
(23
)
(27
)
(94
)
(24
)
(25
)
(21
)
(24
)
Net sales
10,940
2,569
2,723
2,795
2,853
9,673
2,348
2,301
2,486
2,538
___________________________
(1)
Includes intersegment sales primarily
related to the Acetyl Chain.
Table 4a
Factors Affecting Segment Net Sales
Sequentially - Unaudited
Three Months Ended December 31, 2023
Compared to Three Months Ended September 30, 2023
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
(5
)
(3
)
—
(8
)
Acetyl Chain
—
(3
)
—
(3
)
Total Company
(3
)
(3
)
—
(6
)
Three Months Ended September 30, 2023
Compared to Three Months Ended June 30, 2023
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
(1
)
(3
)
—
(4
)
Acetyl Chain
3
(3
)
(1
)
(1
)
Total Company
1
(3
)
(1
)
(3
)
Three Months Ended June 30, 2023
Compared to Three Months Ended March 31, 2023
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
2
(5
)
—
(3
)
Acetyl Chain
2
(3
)
—
(1
)
Total Company
2
(4
)
—
(2
)
Three Months Ended March 31, 2023
Compared to Three Months Ended December 31, 2022
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
34
(4
)
2
32
Acetyl Chain
10
(2
)
2
10
Total Company
19
(4
)
2
17
Three Months Ended December 31, 2022
Compared to Three Months Ended September 30, 2022
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
34
(1
)
—
33
(1)
Acetyl Chain
(9
)
(10
)
—
(19
)
Total Company
8
(6
)
—
2
Three Months Ended September 30, 2022
Compared to Three Months Ended June 30, 2022
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
(1
)
2
(3
)
(2
)
Acetyl Chain
(3
)
(5
)
(2
)
(10
)
Total Company
(2
)
(3
)
(2
)
(7
)
Three Months Ended June 30, 2022
Compared to Three Months Ended March 31, 2022
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
1
6
(3
)
4
Acetyl Chain
(6
)
2
(2
)
(6
)
Total Company
(2
)
2
(2
)
(2
)
Three Months Ended March 31, 2022
Compared to Three Months Ended December 31, 2021
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
23
7
(1
)
29
Acetyl Chain
7
(3
)
—
4
Total Company
12
1
(1
)
12
________________________
(1)
2022 includes the effect of the
acquisition of the majority of the M&M Business.
Table 4b
Factors Affecting Segment Net Sales
Year Over Year - Unaudited
Three Months Ended December 31, 2023
Compared to Three Months Ended December 31, 2022
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
21
(8
)
1
14
Acetyl Chain
14
(11
)
1
4
Total Company
18
(10
)
1
9
Three Months Ended September 30, 2023
Compared to Three Months Ended September 30, 2022
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
75
(12
)
1
64
Acetyl Chain
4
(18
)
1
(13
)
Total Company
33
(16
)
1
18
Three Months Ended June 30, 2023
Compared to Three Months Ended June 30, 2022
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
75
(8
)
—
67
Acetyl Chain
(2
)
(19
)
—
(21
)
Total Company
27
(15
)
—
12
Three Months Ended March 31, 2023
Compared to Three Months Ended March 31, 2022
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
80
2
(3
)
79
Acetyl Chain
(9
)
(13
)
(2
)
(24
)
Total Company
23
(8
)
(3
)
12
Three Months Ended December 31, 2022
Compared to Three Months Ended December 31, 2021
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
67
17
(9
)
75
Acetyl Chain
(12
)
(14
)
(3
)
(29
)
Total Company
13
(5
)
(5
)
3
Three Months Ended September 30, 2022
Compared to Three Months Ended September 30, 2021
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
23
25
(12
)
36
Acetyl Chain
(10
)
2
(5
)
(13
)
Total Company
(2
)
9
(5
)
2
Three Months Ended June 30, 2022
Compared to Three Months Ended June 30, 2021
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
24
24
(9
)
39
Acetyl Chain
(5
)
11
(4
)
2
Total Company
3
14
(4
)
13
Three Months Ended March 31, 2022
Compared to Three Months Ended March 31, 2021
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
20
25
(4
)
41
Acetyl Chain
7
38
(3
)
42
Total Company
12
32
(3
)
41
Table 4c
Factors Affecting Segment Net Sales
Year Over Year - Unaudited
Year Ended December 31, 2023 Compared
to Year Ended December 31, 2022
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
54
(1
)
—
53
Acetyl Chain
2
(17
)
—
(15
)
Total Company
23
(10
)
—
13
Year Ended December 31, 2022 Compared
to Year Ended December 31, 2021
Volume
Price
Currency
Total
(In percentages)
Engineered Materials
33
23
(8
)
48
Acetyl Chain
(6
)
6
(3
)
(3
)
Total Company
6
11
(4
)
13
Table 5
Free Cash Flow - Reconciliation of a
Non-GAAP Measure - Unaudited
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
2022
Q4 '22
Q3 '22
Q2 '22
Q1 '22
(In $ millions, except
percentages)
Net cash provided by (used in) investing
activities
(134
)
(168
)
375
(163
)
(178
)
(11,141
)
(10,713
)
(143
)
(136
)
(149
)
Net cash provided by (used in) financing
activities
(1,456
)
(240
)
(700
)
(447
)
(69
)
10,290
1,944
8,600
(159
)
(95
)
Net cash provided by (used in) operating
activities
1,899
830
403
762
(96
)
1,819
541
467
495
316
Capital expenditures on property, plant
and equipment
(568
)
(128
)
(131
)
(145
)
(164
)
(543
)
(143
)
(139
)
(124
)
(137
)
Contributions from/(Distributions) to
NCI
(11
)
—
(4
)
(6
)
(1
)
(13
)
(3
)
(3
)
(3
)
(4
)
Free cash flow(1)
1,320
702
268
611
(261
)
1,263
395
325
368
175
Net sales
10,940
2,569
2,723
2,795
2,853
9,673
2,348
2,301
2,486
2,538
Free cash flow as % of Net
sales
12.1
%
27.3
%
9.8
%
21.9
%
(9.1
) %
13.1
%
16.8
%
14.1
%
14.8
%
6.9
%
______________________________
(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 contributions from
or distributions to our NCI joint ventures.
Table 6
Cash Dividends Received -
Unaudited
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
2022
Q4 '22
Q3 '22
Q2 '22
Q1 '22
(In $ millions)
Dividends from equity method
investments
157
85
7
25
40
217
82
27
82
26
Dividends from equity investments without
readily determinable fair values
126
31
30
31
34
133
30
30
36
37
Total
283
116
37
56
74
350
112
57
118
63
Table 7
Net Debt - Reconciliation of a Non-GAAP
Measure - Unaudited
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
2022
Q4 '22
Q3 '22
Q2 '22
Q1 '22
(In $ millions)
Short-term borrowings and current
installments of long-term debt - third party and affiliates
1,383
1,383
1,408
1,507
1,386
1,306
1,306
977
809
860
Long-term debt, net of unamortized
deferred financing costs
12,301
12,301
12,291
12,889
13,396
13,373
13,373
11,360
3,022
3,132
Total debt
13,684
13,684
13,699
14,396
14,782
14,679
14,679
12,337
3,831
3,992
Cash and cash equivalents
(1,805
)
(1,805
)
(1,357
)
(1,296
)
(1,167
)
(1,508
)
(1,508
)
(9,671
)
(783
)
(605
)
Net debt
11,879
11,879
12,342
13,100
13,615
13,171
13,171
2,666
3,048
3,387
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:
2023
Q4 '23
Q3 '23
Q2 '23
Q1 '23
2022
Q4 '22
Q3 '22
Q2 '22
Q1 '22
Income Statement
Classification
(In $ millions)
Exit and shutdown costs
89
33
9
21
26
52
2
14
29
7
Cost of sales / SG&A / Other (charges)
gains, net / Gain (loss) on disposition of businesses and assets,
net / Non-operating pension and other postretirement employee
benefit (expense) income
Asset impairments
15
6
9
—
—
13
2
12
(1
)
—
Cost of sales / Other (charges) gains,
net
Impact from plant incidents and natural
disasters(1)
6
—
—
—
6
17
17
—
—
—
Cost of sales
Mergers, acquisitions and dispositions
195
27
46
23
99
267
138
44
29
56
Cost of sales / SG&A
Actuarial (gain) loss on pension and
postretirement plans
69
69
—
—
—
80
80
—
—
—
Cost of sales / SG&A / Non-operating
pension and other postretirement employee benefit (expense)
income
Legal settlements and commercial
disputes
12
4
2
6
—
3
—
1
—
2
Cost of sales / SG&A / Other (charges)
gains, net
(Gain) loss on disposition of businesses
and assets
(510
)
(3
)
(508
)
1
—
(13
)
(1
)
—
(12
)
—
Gain (loss) on disposition of businesses
and assets, net
Other
10
3
4
3
—
3
1
—
2
—
Cost of sales / SG&A
Certain Items attributable to Celanese
Corporation
(114
)
139
(438
)
54
131
422
239
71
47
65
___________________________
(1)
Primarily associated with Winter Storm
Elliott.
Table 9
Return on Invested Capital (Adjusted) -
Presentation of a Non-GAAP Measure - Unaudited
2023
2022
(In $ millions, except
percentages)
(In $ millions, except
percentages)
Net earnings (loss) attributable to
Celanese Corporation
1,960
1,894
Adjusted EBIT (Table 1)
1,753
2,171
Adjusted effective tax rate (Table 3a)
9
%
13
%
Adjusted EBIT tax effected
1,595
1,889
2023
2022
Average
2022
2021
Average
(In $ millions, except
percentages)
Short-term borrowings and current
installments of long-term debt - third parties and affiliates
1,383
1,306
1,345
1,306
791
1,049
Long-term debt, net of unamortized
deferred financing costs
12,301
13,373
12,837
13,373
3,176
8,275
Celanese Corporation stockholders'
equity
7,091
5,637
6,364
5,637
4,189
4,913
Invested capital
20,546
14,237
Return on invested capital
(adjusted)
7.8
%
13.3
%
Net earnings (loss) attributable to
Celanese Corporation as a percentage of invested capital
9.5
%
13.3
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240219665850/en/
Investor Relations Brandon Ayache Phone: +1 972 443 8509
brandon.ayache@celanese.com
Media - U.S. Brian Bianco Phone: +1 972 443 4400
media@celanese.com
Media - Europe Petra Czugler Phone: +49 69 45009 1206
petra.czugler@celanese.com
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