Celanese (CE) Q4 2013 earnings summary

Executive summary

• FY 2013 sales rose $92 million YoY to $6.510 billion; reported operating profit reached $1.508 billion, including a $742 million one-time gain tied to the Kelsterbach relocation settlement.

• Net earnings attributable to shareholders were $1.101 billion versus $372 million in 2012; pension accounting changes and the relocation gain substantially affected the comparison.

• Advanced Engineered Materials and Consumer Specialties improved operating results, while Industrial Specialties and Acetyl Intermediates declined; European and Asian demand and pricing remained challenging in parts of the portfolio.

Financial highlights

• Net sales were $6.510 billion, up $92 million YoY; gross profit was $1.365 billion versus $1.181 billion.

• Reported operating profit was $1.508 billion versus $175 million; the 2013 result included the $742 million Kelsterbach gain and material pension-plan accounting effects.

• Net earnings attributable to shareholders were $1.101 billion versus $372 million; diluted EPS was $6.91 versus $2.33.

• Operating cash flow increased to $762 million from $722 million; year-end cash was $984 million, and total debt was $3.064 billion.

Outlook and guidance

• 2014 earnings growth was expected to come primarily from improved plant operations, upstream and downstream efficiencies, and converting innovation into earnings.

• Global economies were expected to improve in 2014: Europe was forecast to return to growth, China’s export and domestic economies to expand, and North America to continue improving.

• 2014 cash capital expenditures were expected at $450–$500 million, driven by the Clear Lake methanol unit and Narrows boiler conversion projects.

• Closures of the Roussillon acetic anhydride and Tarragona VAM facilities were expected to generate $20–$30 million of savings in 2014.