celanese 2008_march_bb_t_conference_presentation
TRANSCRIPT
1
BB&T 2nd Annual Manufacturing and Materials ConferenceMarch 20, 2008
2
Forward looking statements; Reconciliation and use of non-GAAP measures to U.S. GAAP This presentation may contain “forward-looking statements,” which include information concerning the company’s plans, objectives, goals, strategies, future revenues or performance, capital expenditures, financing needs and other information that is not historical information. When used in this presentation, the words “outlook,” “forecast,” “estimates,” “expects,” “anticipates,” “projects,” “plans,” “intends,” “believes,” and variations of such words or similar expressions are intended to identify forward-looking statements. All forward-looking statements are based upon current expectations and beliefs and various assumptions. There can be no assurance that the company will realize these expectations or that these beliefs will prove correct. There are a number of risks and uncertainties that could cause actual results to differ materially from the forward-looking statements contained in this release. Numerous factors, many of which are beyond the company’s control, could cause actual results to differ materially from those expressed as forward-looking statements. Certain of these risk factors are discussed in the company’s filings with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which it is made, and the company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date on which it is made or to reflect the occurrence of anticipated or unanticipated events or circumstances.
This presentation reflects two performance measures, operating EBITDA and adjusted earnings per share, as non-U.S. GAAP measures. The most directly comparable financial measure presented in accordance with U.S. GAAP in our consolidated financial statements for operating EBITDA is operating profit and for adjusted earnings per share is earnings per common share-diluted.
►Operating EBITDA, a measure used by management to measure performance, is defined as operating profit from continuing operations, plus equity in net earnings from affiliates, other income and depreciation and amortization, and further adjusted for other charges and adjustments. We provide guidance on operating EBITDA and are unable to reconcile forecasted operating EBITDA to a GAAP financial measure because a forecast of other charges and other adjustments is not practical. Our management believes operating EBITDA is useful to investors because it is one of the primary measures our management uses for its planning and budgeting processes and to monitor and evaluate financial and operating results. Operating EBITDA is not a recognized term under U.S. GAAP and does not purport to be an alternative to operating profit as a measure of operating performance or to cash flow from operations as a measure of liquidity. Because not all companies use identical calculations, this presentation of operating EBITDA may not be comparable to other similarly titled measures of other companies. Additionally, operating EBITDA is not intended to be a measure of free cash flow for management’s discretionary use, as it does not consider certain cash requirements such as interest payments, tax payments and debt service requirements nor does it represent the amount used in our debt covenants.
►Adjusted earnings per share is a measure used by management to measure performance. It is defined as net earnings (loss) available to common shareholders plus preferred dividends, adjusted for other charges and adjustments, and divided by the number of basic common shares, diluted preferred shares, and options valued using the treasury method. We provide guidance on an adjusted earnings per share basis and are unable to reconcile forecasted adjusted earnings per share to a GAAP financial measure because a forecast of other charges and other adjustments is not practical. We believe that the presentation of this non-U.S. GAAP measure provides useful information to management and investors regarding various financial and business trends relating to our financial condition and results of operations, and that when U.S. GAAP information is viewed in conjunction with non-U.S. GAAP information, investors are provided with a more meaningful understanding of our ongoing operating performance. This non-U.S. GAAP information is not intended to be considered in isolation or as a substitute for U.S. GAAP financial information.
3
Who is Celanese?
Leading Global Integrated Producer
of Chemicals and Advanced Materials
ExecutionDemonstrated track record
of delivering results
StrategyClear focus on growth and
value creation
CultureStrong performance
built on shared principles and
objectives
Superior Value Creation► Industry Leader
● Geographically balanced global positions
● Diversified end market exposure
► Strong Cash Generation
► Significant Growth Capability
● Track record of execution
● Clearly defined opportunities
4
A leading global integrated producer
Celanese($ in millions)
2007 Revenue1,2: $6,444 2007 Operating EBITDA2: $1,325
Acetyl IntermediatesConsumer and Industrial Specialties
Advanced Engineered Materials
► Leading global producer of engineered polymers
► Strategic affiliates in Asia
► Leading global producer of cellulose acetate products
► Leading global producer of vinyl emulsion products
► Leading global integrated producer of acetyl products
► Significant presence in all three major regions
2007 Revenue1: $2,9552007 Operating EBITDA: $762
2007 Revenue: $2,4572007 Operating EBITDA: $393
2007 Revenue: $1,0302007 Operating EBITDA: $252
1Represents Net Sales2Total 2007Revenue and Operating EBITDA includes Other Activities of $2 and ($82), respectively
5
29% 43% 28%
Geographically balanced global positions and diversified end market exposure
Geographic breakdown based on 2007 Net Sales (by destination)End market breakdown based on 2007 estimated Gross Sales
Other10%
Construction7%
Paints & Coatings15%
Automotive9%
Consumer & MedicalApplications11%
Filter Media16%
Consumer & Industrial
Adhesives4%
Textiles6%
Food & Beverage5%
Chemical Additives
5%Paper &
Packaging8%
Performance Industrial Applications4%
6
Integrated businesses aligned to accelerate growth
Acetyl Intermediates (AI)
Formaldehyde
Differentiated Intermediates Specialty ProductsBuilding Block
Raw Materials
Advanced Engineered Materials
(AEM)
Industrial Specialties
(IS)
Consumer Specialties
(CS)
Ticona Engineering
Polymers
Emulsions
Acetate
AT Plastics
Nutrinova
PVOH
Affiliates
Acetic Acid
Anhydride and esters
VAM
7
Since 2000, Celanese has executed against a simple strategic foundation
Divest non-core assets and revitalize underperforming
businesses
Aggressively align with our customers
and their markets to capture growth
Participate in businesses where we have a sustainable competitive
advantage
Leverage and build on advantaged positions that
optimize our portfolio
FOCUS
GROWTH
REDEPLOYMENT INVESTMENTCelaneseStrategic
Pillars
8
11%10%
11% 11%
17%
19%16%15% 15%
17%
19%20%
19%
16%
21%
5%
10%
15%
20%
25%
2000 2001 2002 2003 2004 2005 2006 2007As Reported Pro Forma for Current Portfolio
Operating EBITDA Margin
Today’s portfolio: more resilient and less volatile
► Current portfolio provides overall higher level of earnings
► Historic view with today’s portfolio reflects significantly less volatility
Current portfolio range: 15% - 21%
Historic portfolio range: 10% - 20%
► One-third of portfolio is new to the company since 2000
► Growth objectives will continue to bolster portfolio
9
Committed to delivering value creation
$350 – $400 million increased EBITDA profile plus EPS potential by 2010
Group Asia Revitalization Innovation Organic Balance Sheet
Operational Excellence
EBITDA Impact
Consumer and Industrial Specialties
X X X X >$100MM
Advanced Engineered Materials
X X X X >$100MM
Acetyl Intermediates X X X >$100MM
Celanese Corporate X X Incremental
EPS
Primary Growth Focus
Ope
ratin
g EB
ITD
AEP
S
10
0
200
400
2007 2008 2009 2010
Operating EBITDA Growth Objectives
On track and clear path forward to accelerate 2010 Growth Objectives
► AEM: volume growth > 2X GDP through further penetration
► CIS: Acetate continues execution on revitalization strategy; Emulsions/PVOH revitalization commences
► AI: Nanjing acetic acid plant startup leads integrated complex
Acetyl IntermediatesConsumer and Industrial SpecialtiesAdvanced Engineered Materials
$ in
mill
ions
11
Strong cash flow generation continues
► Strong operating results► Lower cash taxes► Working capital
productivity► 2008 estimate excludes
Kelsterbach relocation► Decrease in overall
borrowing costs since 2005
► Continued improvement in interest coverage ratio
► Improved capital flexibility
1 Adjusted free cash flow calculated as cash flow from operations less capital expenditures less other productive asset purchases less operating cash from discontinued operations plus certain other charges
Adjusted Free Cash Flow1
2006 2007 2008E
456385
500 - 550
$ in
milli
ons
3.9x
6.5x6.1x
4.5x
0x
1x
2x
3x
4x
5x
6x
7x
2005 2006 2007 2008E
Operating EBITDA/Net Interest
6.9%
8.0% Borrowing Rate
12
Asia strategy: high-return growth
► Total investment: $300 -$350 million – over 80% complete
► Total revenue: $600 - $800 million when sold out by 2010
► Incremental EBITDA: $120 -$150 million by 2010
ROIC = 25 – 30%
Investment Dynamics
EmulsionsComplex
Administration &Maintenance
Utilities /Tank Farm
Compounding
Acetic AcidUnit
Acetic AnhydrideUnit
Vinyl AcetateMonomer Unit
Warehouse GUR®
UnitCelstran®
Unit Flare
Celanese Nanjing Integrated Complex
13
AEM: value of technology and performance is realized in price
$1/ kg
$100 / kg$10 / kg$3 / kg
Price for Performance
95%
5%
Standard Polymers
High-Performance Polymers (HPP)Engineering Thermoplastics (ETP)
ABS, SAN, ASA: 3%
PE = 31% PP = 21%
PET = 7%
PU = 6%
PVC = 17% PS, EPS = 8%
others = 2%
Range of Products$1/kg
$100/kg$10/kg$3/kg
Pric
e R
ange
Perf
orm
ance
Ran
ges
14
Other 3%
AEM: broad range of end-use applications to targeted niches
Revenue by End-Use 2007 ~ $1 billion
Alternate Fabrication11%
Transportation 45%
● Fuel systems● Safety systems● Mechanical components
Electrical & Electronics 11%
● Communication systems● LED lighting● Connectors
Consumer & Appliance 10%
● Water purification● Durable household goods● Bakeware
Industrial 14%
● Fluid handling● Gearing
● Drug delivery systems● Medical implants
Medical 6%
● Emissions filtration● Textiles
15
13
6
2.5
40
18
Source: Global Insight
Pounds per Vehicle
Source: Celanese estimates
AEM: significant opportunity for increased penetration in high growth region
0 3,000 6,000 9,000 12,000 15,000
Mexico
Canada
Spain
Brazil
France
S. Korea
India
Germany
U.S.
Japan
China
Vehicle Production (thousand units)
2006 Production
Production Growth 2006-2012
China production nearly doubles within 5 years
Trend
Global Auto Production
2001
2010E
Highest Current Model
China Current
2007E
Advanced Engineered Materials Type of Resins
16
CS Operating EBITDA 2004 – 2010E
0
50
100
150
200
250
300
350
2004 2005 2006 2007 2008E 2009E 2010E
$ in
mill
ions
CS: successful revitalization and continued execution of current strategy
► Acetate Products revitalization completed in 2007
► Full synergy capture of APL acquisition by 2008
► Nutrinova to offset price declines with volume increases
► Modest growth beyond 2008:
Growth in Asia continues at 2-3%per yearSustainable Operating EBITDA
1Dividends from cost investments
Asian Growth1
Growth Objective
Nutrinova Operating EBITDA
Acetate Base Operating EBITDA
European Initiative
North America/Europe Revitalization
17
0.0
1.0
2.0
3.0
4.0
2006 2010E
Global Vinyl Emulsions Applications Driving 2010 Growth
OthersCelanese
IS: technology enhancements open $1.0 billion of new opportunities
$ in
bill
ions
Applications2010E
Application Sales ($MM)
Growth Rate
Low VOC and nanopaints $400 – $500 10+%
Engineered fabrics/glass fiber $200 – $300 3% - 5%
Enviro-friendly adhesives $100 – $200 8%
China building/construction $100 – $200 30+%
~25%
$1.0 billion expansion = >$250 million in revenue
~30% increase in vinyl space
>25%
18
IS: current regulatory trends in U.S. create new opportunities for VAE
► Current trends in U.S. following European precedent► In 2008, Southern California will further restrict emission requirements in paints► Today, less than 25% of the interior paints meet the contemplated guidelines
$100 - $2001 per ton estimated cost for non-VAE emulsions to achieve standard► U.S. interior paint opportunity ~$1.0 billion
0%
50%
1996 2006 2010E
Celanese Others
European VAE Success
VAE
Shar
e of
Inte
rior
Pain
ts
European Interior Paint Industry Development
1990 2006
VOC Content
EU V
OC
par
ts/li
ter
1999 2008
US
VOC
gra
ms/
liter
1999VOC (g/L): 250 – 380
2004VOC (g/L): 100 – 150
VOC Regulatory Trends for Flat to Semi-Gloss Paints
European Standard
VAE provides favorable substitution for low-VOC requirements
1Based on Celanese estimates
19
AI: advantaged operating costs and favorable supply/demand continues through 2010
2010E Acetic Acid Cost Curve (kt) (based on nameplate capacity)
By-prod
High Cost Supply
Celanese Technology
0 2,000 4,000 6,000 8,000 10,000 14,000
Conventional MeOH/CO
AOPlus™/Leading Competition
Ethanol
Ethylene
12,000Utilization of EffectiveCapacity1(11/07 ): 91% 93% 92% 94% 93% 91% 91%
Acetic Acid Supply/Demand Balance
12008E-2010E effective utilization based on external analysis assumptionsSource: Celanese estimates, available public data
0
2,000
4,000
6,000
8,000
10,000
12,000
2004 2005 2006 2007E 2008E 2009E 2010E
kt
High CostLow CostDemand
20
Increasing Ethylene Costs ($US/ton)1
Volatile Methanol Prices ($US/ton)1
AI: continued earnings stability
►Southern Chemical contract
►Advantaged European methanol
►Producer-type ethylene economics
►Significant captive product consumption
► Ibn Sinadividends
►Select formula-based pricing
►Coal-based CO in NanjingAsia AverageWest Europe North America
1Source: CMAI
200
300
400
500
600
700
800
Q1 2005 Q2 2005 Q3 2005 Q4 2005 Q1 2006 Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 Q3 2007 Q4 2007E
Q1 2005 Q2 2005 Q3 2005 Q4 2005 Q1 2006 Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 Q3 2007 Q4 2007E
0%
10%
20%
30%
Q105
Q205
Q305
Q405
Q106
Q206
Q306
Q406
Q107
Q207
Q307
Q407
Rolling Four-quarter Average
Operating EBITDA as a % of Revenues
Ope
ratin
g EB
ITD
A a
s a
% o
f Rev
enue
s
Stable Acetyl Intermediates Operating EBITDA Margin
600
700
800
900
1,000
1,100
1,200
1,300
1,400
1,500
21
Recent initiatives to support growth beyond 2010
► Signed an agreement with Wison to double Nanjing CO supply increasing reliability and supporting future expansion
► Announced agreement with SWRI, a leading Chinese technology institute, to acquire technology licensing rights and development capabilities
► Direct to ChinaAnnounced plans to add polymer compounding unit to the Nanjing Complex
Commissioned start-up of Nanjing Celstran® unit
► Kelsterbach relocationAnnounced 40% capacity expansion at new European POM facility
Recent Actions
Advanced Engineered Materials
Acetyl Intermediates
Recently announced authorization for $400 million share repurchase
22
Appendix
23
600ktSopo (expansion)
200kt
350kt
Tianjin Bohei
Lunan Cathay (expansion)
A
A
A
200ktDaqing
200ktHualu Hensheng A
Delays continue to be common for acetyl projects
= Project delay
Company announced startup A CE 2005 update CE 2006 update CE 2007 update
500ktAcetex (Tasnee)
150ktSopo
150ktFanavaran
200ktLunan Cathay
200ktWujing
150ktBP / Yaraco
300ktBP/FPC
2008200720062005
425kt
550kt
600kt
Capacity
BP / Sinopec
Celanese Nanjing (Phase 1)
Sipchem
20102009Company
A
A
A
A
A
A
A
A
A
A
A
SU
X
SU
SU
X
X
X
X
SU
SU
Cancelled
X
X
X
X
X
X
X
X
X
SU
SU
X
SU
X
X
X
X
X
= Actual plant startupSUX
24
2008 business outlook (updated on February 5, 2008)
► Continued strong global demand► Incremental acetic acid volume
associated with China expansion► VAM and acetic anhydride production scheduled to
begin in Nanjing► Prices expected to adjust in 2008
Acetyl Intermediates
► Volume growth >2x GDP across both transportation and non-transportation applications
► Continued high energy and raw material costs expected to pressure margins
► Significant progress expected in Nanjing production capabilities
Advanced Engineered Materials
► Synergy capture from APL integration► Strong underlying business fundamentals
Consumer Specialties
► High raw material costs continue► Realize benefits from revitalization efforts
Industrial Specialties
2008 Guidance:
Adjusted EPS $3.40 to $3.70
Operating EBITDA$1,290 to $1,360 million
Forecasted 2008 adjusted tax rate of
26%
25
Strong financial performance in 2007
620748140324Operating Profit
40642677214Net Earnings
9211315(93)Other Charges/Adjustments
1,325
$3.42
6,444
FY 2007
269
$0.61
1,430
4th Qtr 2006$ in millions (except EPS) 4th Qtr 2007 FY 2006
Sales 1,760 5,778
Adjusted EPS $0.93 $2.62
Operating EBITDA 349 1,144
26
$58$224
4th Qtr 2006
$252$1,030
FY 2007
$260$915
FY 2006
$45$253
4th Qtr 2007
Operating EBITDANet Salesin millions
Advanced Engineered Materials
Fourth Quarter 2007:► Net sales increase driven primarily by strong volume growth (8%) and
positive currency effects (6%)► Higher raw material and energy costs and lower pricing due to
product mix more than offset volume growth► Overall lower earnings from equity affiliates and continued high input
cost pressures drove decreased Operating EBITDA
27
Fourth Quarter 2007:► Increase in net sales for the quarter primarily the result of $62 million
contribution from APL ► Operating EBITDA improvement driven by higher overall volumes
and pricing as well as incremental earnings from APL
Consumer Specialties
$53$224
4th Qtr 2006
$274$1,111
FY 2007
$228$876
FY 2006
$57 $279
4th Qtr 2007
Operating EBITDANet Salesin millions
28
Fourth Quarter 2007:► Increase in net sales primarily driven by favorable pricing and
currency effects► Higher pricing on strong demand offset raw material cost pressures
contributing to improved Operating EBITDA for the quarter
Industrial Specialties
$25$309
4th Qtr 2006
$119$1,346
FY 2007
$118$1,281
FY 2006
$41$331
4th Qtr 2007
Operating EBITDANet Salesin millions
29
Acetyl Intermediates
$169$831
4th Qtr 2006
$762$3,615
FY 2007
$672$3,351
FY 2006
$231$1,083
4th Qtr 2007
Operating EBITDANet Salesin millions
Fourth Quarter 2007:► Higher pricing, additional volumes from Nanjing unit and
favorable currency effects drove record sales► Favorable supply/demand economics, industry production
outages and strong demand sustained higher pricing for acetic acid and VAM
► Operating EBITDA includes increased dividends from the IbnSina cost affiliate
30
Reg G: Reconciliation of Adjusted EPSAdjusted Earnings Per Share - Reconciliation of a Non-U.S. GAAP Measure
(in $ millions, except per share data) 2007 2006 2007 2006Earnings from continuing operations before tax and minority interests 313 125 447 526 Non-GAAP Adjustments: Other charges and other adjustments 1 (93) 15 113 92 Refinancing costs - - 254 - Adjusted earnings from continuing operations before tax and minority interests 220 140 814 618 Income tax provision on adjusted earnings 2 (62) (35) (228) (163)Minority interests (1) (1) (1) (4)Adjusted earnings from continuing operations 157 104 585 451Preferred dividends (3) (2) (10) (10)Adjusted net earnings available to common shareholders 154 102 575 441Add back: Preferred dividends 3 2 10 10Adjusted net earnings for adjusted EPS 157 104 585 451
Diluted shares (millions)Weighted average shares outstanding 151.7 158.7 154.5 158.6Assumed conversion of Preferred Shares 12.0 12.0 12.0 12.0 Assumed conversion of Restricted Stock 0.6 - 0.4 - Assumed conversion of stock options 4.3 1.8 4.3 1.2 Total diluted shares 168.6 172.5 171.2 171.8Adjusted EPS 0.93 0.61 3.42 2.621 See Table 7 for details2 The adjusted tax rate for the three and twelve months ended December 31, 2007 is 28% based on the original full year 2007 guidance.
Twelve Months EndedDecember 31,
Three Months EndedDecember 31,
31
Other Charges:
(in $ millions) 2007 2006 2007 2006Employee termination benefits 5 1 32 12 Plant/office closures 7 (1) 11 (1)Insurance recoveries associated with plumbing cases (2) (2) (4) (5)Insurance recoveries associated with Clear Lake, Texas (40) - (40) - Resolution of commercial disputes with a vendor (31) - (31) - Deferred compensation triggered by Exit Event - - 74 - Asset impairments - - 9 - Ticona Kelsterbach plant relocation 1 - 5 - Other - - 2 4 Total (60) (2) 58 10
Other Adjustments: 1
(in $ millions) 2007 2006 2007 2006Executive severance & other costs related to Squeeze-Out - 2 - 30 Ethylene pipeline exit costs - - 10 - Business optimization 8 8 18 12 Foreign exchange loss related to refinancing transaction - - 22 - Loss on AT Plastics films sale - - 7 - Discontinued methanol production 2 - 16 31 52 Gain on disposal of investment (Pemeas) - (11) - (11) Gain on Edmonton sale (34) - (34) - Other (7) 2 1 (1) Total (33) 17 55 82
Total other charges and other adjustments (93) 15 113 92 1 These items are included in net earnings but not included in other charges.2 Adjusted earnings per share included earnings from its discontinued methanol production which was included in the company's 2007 guidance.
December 31, December 31,
Three Months Ended Twelve Months Ended
Three Months Ended Twelve Months Ended
December 31, December 31,
Reg G: Other Charges and Other Adjustments
Other Charges and Other Adjustments
32 Segm
ent D
ata
and
Rec
onci
liatio
n of
Ope
ratin
g Pr
ofit
(Los
s) to
Ope
ratin
g EB
ITD
A -
a
Non
-U.S
. GAA
P M
easu
re
(in $
mill
ions
) 20
0720
0620
0720
06N
et S
ales
Adv
ance
d En
gine
ered
Mat
eria
ls25
322
41,
030
91
5
Con
sum
er S
peci
altie
s27
9
22
4
1,11
1
876
I
ndus
trial
Spe
cial
ties
331
309
1,34
6
1,28
1
A
cety
l Int
erm
edia
tes
1,08
383
13,
615
3,
351
Oth
er A
ctiv
ities
1-
62
22
Int
erse
gmen
t elim
inat
ions
(186
)(1
64)
(660
)
(6
67)
Tota
l1,
760
1,43
06,
444
5,
778
Ope
ratin
g Pr
ofit
(Los
s) A
dvan
ced
Engi
neer
ed M
ater
ials
30
29
133
14
5
Con
sum
er S
peci
altie
s69
41
19
9
165
I
ndus
trial
Spe
cial
ties
26
9
28
44
A
cety
l Int
erm
edia
tes
276
10
7
616
45
6
Oth
er A
ctiv
ities
1(7
7)
(46)
(2
28)
(190
)
To
tal
324
14
0
748
62
0
Equi
ty E
arni
ngs
and
Oth
er In
com
e/(E
xpen
se) 2
Adv
ance
d En
gine
ered
Mat
eria
ls7
13
55
55
Con
sum
er S
peci
altie
s3
2
40
24
I
ndus
trial
Spe
cial
ties
-
-
-
(1
)
Ace
tyl I
nter
med
iate
s27
23
78
63
O
ther
Act
iviti
es 1
8
12
-
22
Tota
l45
50
17
3
163
Oth
er C
harg
es a
nd O
ther
Adj
ustm
ents
3
Adv
ance
d En
gine
ered
Mat
eria
ls(1
0)
(1)
(5)
(5)
C
onsu
mer
Spe
cial
ties
(27)
-
(16)
-
Ind
ustri
al S
peci
altie
s(1
)
2
32
16
Ace
tyl I
nter
med
iate
s(9
7)
16
(38)
52
O
ther
Act
iviti
es 1
42
(2)
140
29
To
tal
(93)
15
11
3
92
Dep
reci
atio
n an
d Am
ortiz
atio
n Ex
pens
e A
dvan
ced
Engi
neer
ed M
ater
ials
18
17
69
65
Con
sum
er S
peci
altie
s12
10
51
39
I
ndus
trial
Spe
cial
ties
16
14
59
59
Ace
tyl I
nter
med
iate
s25
23
10
6
101
O
ther
Act
iviti
es 1
2
-
6
5
Tota
l73
64
29
1
269
Ope
ratin
g EB
ITD
A A
dvan
ced
Engi
neer
ed M
ater
ials
45
58
252
26
0
Con
sum
er S
peci
altie
s57
53
27
4
228
I
ndus
trial
Spe
cial
ties
41
25
119
11
8
Ace
tyl I
nter
med
iate
s23
1
169
76
2
672
O
ther
Act
iviti
es 1
(25)
(3
6)
(82)
(1
34)
Tota
l34
9
269
1,
325
1,14
4
1 O
ther
Act
iviti
es p
rimar
ily in
clud
es c
orpo
rate
sel
ling,
gen
eral
and
adm
inis
trativ
e ex
pens
es a
nd th
e re
sults
from
cap
tive
insu
ranc
e co
mpa
nies
.
T
he 2
007
Ope
ratin
g P
rofit
(Los
s) a
nd O
ther
Cha
rges
and
Oth
er A
djus
tmen
ts a
mou
nts
incl
ude
dedu
ctib
le a
ssoc
iate
d w
ith in
sura
nce
reco
very
.2 I
nclu
des
equi
ty e
arni
ngs
from
affi
liate
s, d
ivid
ends
from
cos
t inv
estm
ents
and
oth
er in
com
e/(e
xpen
se).
3 E
xclu
des
adju
stm
ents
to m
inor
ity in
tere
st, n
et in
tere
st, t
axes
, dep
reci
atio
n, a
mor
tizat
ion
and
disc
ontin
ued
oper
atio
ns (S
ee T
able
7).
Thre
e M
onth
s En
ded
Dec
embe
r 31,
Twel
ve M
onth
s En
ded
Dec
embe
r 31,
Reg G: Reconciliation of Operating EBITDA
33
Reg G: Reconciliation of Operating EBITDA
Segm
ent D
ata
and
Rec
onci
liatio
n of
Ope
ratin
g Pr
ofit
(Los
s) to
Ope
ratin
g EB
ITD
A -
a
Non
-U.S
. GAA
P M
easu
re.
(in $
mill
ions
) 20
0720
0620
0720
06N
et S
ales
Adv
ance
d En
gine
ered
Mat
eria
ls25
823
077
7
69
1
Con
sum
er S
peci
altie
s28
2
21
3
832
652
I
ndus
trial
Spe
cial
ties
314
335
1,01
5
972
A
cety
l Int
erm
edia
tes
859
872
2,53
2
2,52
0
O
ther
Act
iviti
es 1
65
2
16
I
nter
segm
ent e
limin
atio
ns(1
46)
(184
)(4
74)
(503
)
To
tal
1,57
31,
471
4,68
4
4,34
8
Ope
ratin
g Pr
ofit
(Los
s) A
dvan
ced
Engi
neer
ed M
ater
ials
35
37
103
11
6
Con
sum
er S
peci
altie
s34
35
13
0
124
I
ndus
trial
Spe
cial
ties
(9)
17
2
35
A
cety
l Int
erm
edia
tes
117
12
6
340
34
9
Oth
er A
ctiv
ities
1(3
0)
(43)
(1
51)
(144
)
To
tal
147
17
2
424
48
0
Equi
ty E
arni
ngs
and
Oth
er In
com
e/(E
xpen
se) 2
Adv
ance
d En
gine
ered
Mat
eria
ls18
14
48
42
C
onsu
mer
Spe
cial
ties
2
-
37
22
Ind
ustri
al S
peci
altie
s-
-
-
(1)
A
cety
l Int
erm
edia
tes
28
18
51
40
Oth
er A
ctiv
ities
1(1
0)
10
(8)
10
Tota
l38
42
12
8
113
Oth
er C
harg
es a
nd O
ther
Adj
ustm
ents
3
Adv
ance
d En
gine
ered
Mat
eria
ls-
-
5
(4)
C
onsu
mer
Spe
cial
ties
2
-
11
-
I
ndus
trial
Spe
cial
ties
14
3
33
14
A
cety
l Int
erm
edia
tes
2
10
59
36
O
ther
Act
iviti
es 1
22
3
98
31
To
tal
40
16
206
77
Dep
reci
atio
n an
d Am
ortiz
atio
n Ex
pens
e A
dvan
ced
Engi
neer
ed M
ater
ials
17
16
51
48
Con
sum
er S
peci
altie
s15
9
39
29
Ind
ustri
al S
peci
altie
s13
16
43
45
A
cety
l Int
erm
edia
tes
31
23
81
78
Oth
er A
ctiv
ities
11
2
4
5
To
tal
77
66
218
20
5
Ope
ratin
g EB
ITD
A A
dvan
ced
Engi
neer
ed M
ater
ials
70
67
207
20
2
Con
sum
er S
peci
altie
s53
44
21
7
175
I
ndus
trial
Spe
cial
ties
18
36
78
93
Ace
tyl I
nter
med
iate
s17
8
177
53
1
503
O
ther
Act
iviti
es 1
(17)
(2
8)
(57)
(9
8)
Tota
l30
2
296
97
6
875
1 O
ther
Act
iviti
es p
rimar
ily in
clud
es c
orpo
rate
sel
ling,
gen
eral
and
adm
inis
trativ
e ex
pens
es
and
the
resu
lts fr
om c
aptiv
e in
sura
nce
com
pani
es.
2 I
nclu
des
equi
ty e
arni
ngs
from
affi
liate
s, d
ivid
ends
from
cos
t inv
estm
ents
and
oth
er in
com
e/(e
xpen
se)
3 E
xclu
des
adju
stm
ents
to m
inor
ity in
tere
st, n
et in
tere
st, t
axes
, dep
reci
atio
n, a
mor
tizat
ion
and
disc
ontin
ued
oper
atio
ns.
Thre
e M
onth
s En
ded
Sept
embe
r 30,
Nin
e M
onth
s En
ded
Sept
embe
r 30,
34
Reg G: Reconciliation of Operating EBITDA
Segm
ent D
ata an
d Rec
oncil
iation
of O
pera
ting P
rofit
(Los
s) to
Ope
ratin
g EBI
TDA
- a N
on-U
.S. G
AAP
Meas
ure -
Una
udite
d Twelv
e Mon
ths E
nded
Marc
h 31,
June
30,
Sept
embe
r 30,
Dece
mber
31,
Dece
mber
31,
(in $
millio
ns)
2005
2005
2005
2005
2005
Net S
ales
Adv
ance
d Eng
ineer
ed M
ateria
ls23
9
22
3
212
213
88
7
C
onsu
mer S
pecia
lties
212
219
20
8
20
0
839
Indu
strial
Spe
cialtie
s20
6
26
3
305
286
1,0
60
Ace
tyl In
terme
diates
690
707
73
1
78
3
2,911
O
ther A
ctivit
ies 1
12
8
6
6
32
Inter
segm
ent e
limina
tions
(95)
(99)
(113)
(15
3)
(460)
To
tal1,2
64
1,321
1,3
49
1,335
5,2
69
Oper
ating
Pro
fit (L
oss)
Adv
ance
d Eng
ineer
ed M
ateria
ls39
5
18
(2)
60
Con
sume
r Spe
cialtie
s24
27
21
56
12
8
In
dustr
ial S
pecia
lties
-
5
5
(14)
(4)
A
cetyl
Inter
media
tes14
3
12
1
76
146
486
Othe
r Acti
vities
1(83
)
(33
)
(38
)
(30
)
(18
4)
Total
123
125
82
15
6
48
6
Equit
y Ear
nings
and O
ther
Inco
me/(E
xpen
se) 2
Adv
ance
d Eng
ineer
ed M
ateria
ls12
16
15
11
54
Con
sume
r Spe
cialtie
s-
2
(2)
3
3
In
dustr
ial S
pecia
lties
-
-
-
-
-
Ace
tyl In
terme
diates
12
(10
)
32
35
69
Othe
r Acti
vities
1(8)
18
(2)
5
13
To
tal16
26
43
54
13
9
Othe
r Cha
rges
and O
ther
Adju
stmen
ts 3
Adv
ance
d Eng
ineer
ed M
ateria
ls1
20
4
6
31
C
onsu
mer S
pecia
lties
1
-
10
(24
)
(13
)
In
dustr
ial S
pecia
lties
-
2
8
1
11
A
cetyl
Inter
media
tes19
11
15
(30)
15
O
ther A
ctivit
ies 1
45
(10
)
2
3
40
Total
66
23
39
(44
)
84
Depr
eciat
ion an
d Amo
rtiza
tion E
xpen
se A
dvan
ced E
ngine
ered
Mate
rials
15
14
13
18
60
C
onsu
mer S
pecia
lties
12
12
7
11
42
Indu
strial
Spe
cialtie
s12
11
7
17
47
A
cetyl
Inter
media
tes17
24
35
34
11
0
O
ther A
ctivit
ies 1
2
2
4
1
9
Total
58
63
66
81
268
Oper
ating
EBI
TDA*
Adv
ance
d Eng
ineer
ed M
ateria
ls67
55
50
33
20
5
C
onsu
mer S
pecia
lties
37
41
36
46
160
Indu
strial
Spe
cialtie
s12
18
20
4
54
A
cetyl
Inter
media
tes19
1
14
6
15
8
18
5
68
0
O
ther A
ctivit
ies 1
(44)
(23)
(34)
(21)
(122)
To
tal26
3
23
7
23
0
24
7
97
7
*Q
uarte
rly ea
rning
s for
the d
iscon
tinue
d Edm
onton
Meth
anol
18
10
4
3
35
oper
ation
s hav
e bee
n inc
luded
in O
ther C
harg
es an
d Othe
r Adju
stmen
ts.
Oxo A
lcoho
l Dive
stitu
re22
28
22
9
81
To
tal O
pera
ting E
BITD
A - a
s rep
orted
285
265
252
256
1,058
1 Othe
r Acti
vities
prim
arily
inclu
des c
orpo
rate
sellin
g, ge
nera
l and
admi
nistra
tive e
xpen
ses a
nd th
e res
ults f
rom
capti
ve in
sura
nce c
ompa
nies.
2 Inclu
des e
quity
earn
ings f
rom
affilia
tes, d
ivide
nds f
rom
cost
inves
tmen
ts an
d othe
r inco
me/(e
xpen
se).
3 Exc
ludes
adjus
tmen
ts to
mino
rity in
teres
t, net
inter
est, t
axes
, dep
recia
tion,
amor
tizati
on an
d disc
ontin
ued o
pera
tions
.
Thre
e Mon
ths E
nded
35
Reg G: Reconciliation of Operating EBITDA
Segm
ent D
ata a
nd R
econ
ciliat
ion
of O
pera
ting
Prof
it (L
oss)
to O
pera
ting E
BITD
A - a
Non
-U.S
. GAA
P Me
asur
e - U
naud
ited Tw
elve M
onth
s End
edMa
rch
31,
June
30,
Sept
embe
r 30,
Dece
mbe
r 31,
Dece
mbe
r 31,
(in $
millio
ns)
2006
2006
2006
2006
2006
Net S
ales
Adv
ance
d Eng
ineer
ed M
ateria
ls23
1
230
23
0
224
915
C
onsu
mer S
pecia
lties
216
22
3
213
22
4
87
6
Indu
strial
Spe
cialtie
s31
1
326
33
5
309
1,281
A
cetyl
Inter
media
tes80
9
839
87
2
831
3,351
O
ther A
ctivit
ies 1
5
6
5
6
22
In
terse
gmen
t elim
inatio
ns(1
52)
(1
67)
(184
)
(1
64)
(6
67)
To
tal
1,420
1,4
57
1,471
1,4
30
5,778
Oper
atin
g Pr
ofit
(Los
s) A
dvan
ced E
ngine
ered
Mate
rials
41
38
37
29
145
Con
sume
r Spe
cialtie
s42
47
35
41
16
5
In
dustr
ial S
pecia
lties
15
3
17
9
44
A
cetyl
Inter
media
tes10
3
12
0
12
6
10
7
45
6
O
ther A
ctivit
ies 1
(45)
(56)
(43)
(46)
(190
)
Tota
l15
6
15
2
17
2
14
0
62
0
Equi
ty E
arni
ngs a
nd O
ther
Inco
me/(
Expe
nse)
2
Adv
ance
d Eng
ineer
ed M
ateria
ls14
14
14
13
55
Con
sume
r Spe
cialtie
s-
22
-
2
24
In
dustr
ial S
pecia
lties
-
(1)
-
-
(1
)
A
cetyl
Inter
media
tes7
15
18
23
63
O
ther A
ctivit
ies 1
3
(3)
10
12
22
Tota
l24
47
42
50
16
3
Othe
r Cha
rges
and
Othe
r Adj
ustm
ents
3
Adv
ance
d Eng
ineer
ed M
ateria
ls(2
)
(2)
-
(1
)
(5)
Con
sume
r Spe
cialtie
s-
-
-
-
-
In
dustr
ial S
pecia
lties
1
10
3
2
16
Ace
tyl In
terme
diates
12
14
10
16
52
O
ther A
ctivit
ies 1
13
15
3
(2)
29
Tota
l24
37
16
15
92
Depr
eciat
ion
and
Amor
tizat
ion
Expe
nse
Adv
ance
d Eng
ineer
ed M
ateria
ls16
16
16
17
65
Con
sume
r Spe
cialtie
s11
9
9
10
39
Indu
strial
Spe
cialtie
s14
15
16
14
59
Ace
tyl In
terme
diates
23
32
23
23
101
Othe
r Acti
vities
11
2
2
-
5
To
tal
65
74
66
64
269
Oper
atin
g EB
ITDA
* A
dvan
ced E
ngine
ered
Mate
rials
69
66
67
58
260
Con
sume
r Spe
cialtie
s53
78
44
53
22
8
In
dustr
ial S
pecia
lties
30
27
36
25
118
Ace
tyl In
terme
diates
145
181
177
169
672
Othe
r Acti
vities
1(2
8)
(4
2)
(2
8)
(3
6)
(1
34)
To
tal
269
310
296
269
1,144
*Q
uarte
rly ea
rning
s for
the d
iscon
tinue
d Edm
onton
Meth
anol
14
12
10
16
52
op
erati
ons h
ave b
een i
nclud
ed in
Othe
r Cha
rges
and O
ther A
djustm
ents.
Oxo
Alco
hol D
ivest
iture
**-
-
26
39
65
Tota
l Ope
ratin
g EB
ITDA
- as
repo
rted
269
310
322
308
1,209
**F
or co
mpar
ative
purp
oses
. Th
e Oxo
Alco
hol D
ivesti
ture w
as re
flecte
d as a
disc
ontin
ued o
pera
tion f
or th
e thr
ee m
onths
ende
d Mar
ch 31
, 200
6 and
June
30, 2
006
in co
njunc
tion w
ith re
portin
g the
resu
lts fo
r the
first
and s
econ
d qua
rter o
f 200
7.
1 Oth
er A
ctivit
ies pr
imar
ily in
clude
s cor
pora
te se
lling,
gen
eral
and
admi
nistra
tive e
xpen
ses a
nd th
e re
sults
from
capti
ve in
sura
nce
comp
anies
.2 In
clude
s equ
ity e
arnin
gs fr
om af
filiat
es, d
ivide
nds f
rom
cost
inves
tmen
ts an
d oth
er in
come
/(exp
ense
).3 E
xclud
es a
djustm
ents
to m
inorit
y int
eres
t, ne
t inte
rest,
taxe
s, de
prec
iation
, amo
rtizati
on a
nd d
iscon
tinue
d op
erat
ions.
Thre
e Mon
ths E
nded
36
Reg G: Reconciliation of 2000 – 2006 Operating EBITDA
Total Celanese 2000 2001 2002 2003 2004 2005 1 2006 1
GAAP Operating Profit 78 (470) 162 133 130 573 747 Depreciation & Amortization 364 372 300 328 256 285 283 Other Charges & Other Adjustments 27 472 (1) 6 340 50 40 Equity Earnings and Other Income/(Expense) 58 58 58 92 75 150 174 Operating EBITDA 528 432 519 559 801 1,058 1,244
Net Sales 4,888 4,537 4,535 5,133 5,069 6,070 6,656 Operating EBITDA Margin 11% 10% 11% 11% 16% 17% 19%
Portfolio Adjustment 5% 5% 4% 6% 3% 3% 0%Pro Forma EBITDA Margin for Current Portfolio 16% 15% 15% 17% 19% 20% 19%
1Amounts as reported in the 4Q 2006 earnings release