Celanese (CE) Q3 2024 earnings summary

Executive summary

• Q3 2024 net sales were $2.65B, down 3% year-over-year, with persistent demand weakness in auto, industrial, paints, coatings, and construction end-markets.

• Operating profit for Q3 2024 was $248M, a 71% decrease from Q3 2023, mainly due to a prior-year gain from the Nutrinova JV that did not recur.

• The company announced a 95% temporary reduction in its quarterly dividend starting Q1 2025 to support deleveraging.

• Actions include significant cost reductions, production slowdowns, and a focus on operational excellence and future growth opportunities.

• Net earnings attributable to Celanese for Q3 2024 were $116M, down from $951M in Q3 2023; nine-month net earnings were $392M, down from $1.26B.

Financial highlights

• Q3 2024 net sales were $2.648B, down from $2.723B in Q3 2023 and flat sequentially.

• Gross profit for Q3 2024 was $622M, down from $673M in Q3 2023; operating margin was 9.4% versus 30.9% in Q3 2023.

• Adjusted EBIT was $457M, flat year-over-year; operating EBITDA was $644M, up from $624M in Q3 2023.

• Free cash flow was $(16)M, with operating cash flow of $79M and $88M in capex.

• Cash and cash equivalents as of September 30, 2024, were $813M, down from $1.81B at year-end 2023.

Outlook and guidance

• Q4 2024 guidance reflects further earnings decline, driven by seasonality, destocking, and continued weakness in auto and industrial end-markets.

• Q4 adjusted EPS guidance is approximately $1.25.

• Most one-off impacts in Q4 are expected to reverse in Q1 2025, potentially improving results.

• Management is cautious about 2025, citing significant uncertainty in demand recovery and macro conditions.

• Capital expenditures for 2024 are expected to be approximately $425M, focused on maintenance, productivity, and select growth projects.