Celanese Corporation · NYSE:CE
Celanese — Investor Day (November 2015)
104 slides from Celanese's investor day presentation, Nov 13, 2015
Slide 1: Investor Day
Investor Day N OVE M B E R 13, 20 1 5
Slide 2: Disclosures
Disclosures Forward Looking Statements This presentation, and statements made in connection with this presentation, contain “forward-looking statements,” which include information concerning the company’s plans, objectives, goals, strategies, future revenues or performance, capital expenditures, fin
Slide 3: What we'll go over today
What we’ll go over today Mark Rohr 8.00a – 8.30a Chairman and Chief Executive Officer Celanese Overview Pat Quarles 8.30a – 9.00a President Acetyls Chain Scott Sutton 9.00a – 9.30a President Materials Solutions Ashish Kulkarni 9.30a – 11.00a Chief Technology Officer Innovation Showcase Chris Jensen
Slide 4: Mark Rohr
I N V E S T O R D AY N O V E M B E R 1 3 , 2 0 1 5 Mark Rohr C H AIRM AN & C H I E F E X E CUT I V E OF F I CE R
Slide 5: Unique company with complementary cores
Unique company with complementary cores STRUCTURAL > Advantaged cost > Distinct and leveragable UNIQUENESS > Global network value creation models UNIQUENESS HELPS ADDRESS > Low-growth economic > Currency volatility GLOBAL environment > Low capacity utilization CHALLENGES GROW: LEVERAGE > Global trad
Slide 6: This complementary structure drives tremendous synergy
This complementary structure drives tremendous synergy > Innovation programs leverage resources across the company > Cross-business projects leverage industry and/or technical knowledge MANUFACTURING > Broad portfolio shares customer and industry insights > Process innovation across businesses drive
Slide 7: Starting with common technology & processes
Starting with common technology & processes Formaldehyde Engineered Materials Methanol Acetic Acid & Anhydride Cellulose Derivatives Carbon Monoxide Ethanol Emulsion Polymers Food Ingredients Ethylene Vinyl Acetate Monomer EVA Polymers A CE T Y L CH A I N Includes Acetyl Intermediates and Industrial
Slide 8: Productivity is an example
Productivity is an example > Raw material flexibility and yield improvement 2015 GROSS PRODUCTIVITY MANUFACTURING > Energy efficiency and reduction > Asset utilization and reliability Business Manufacturing Enterprise > Raw material and maintenance sourcing SUPPLY CHAIN > S&OP process improvement >
Slide 9: Helping us manage global economic volatility
…Helping us manage global economic volatility > Modest growth > Euro depreciation > Celanese driving productivity > Celanese investing in growth > Lower GDP growth > Continued growth > Higher consumer growth > Feedstock advantage > Tremendous overcapacity > Low-cost export base > Celanese driving pr
Slide 10: Like challenges in China
Like challenges in China PAGE 10 PAGE 11 CHINA REAL GDP GROWTH, YOY PAGE 10 PAGE 11choice for product 10.6% 9.5% Unparalleled 11.0% 19.1% 8.2% 8.4% 18.1% > Superior location and logistics 8.0% 8.0% 7.7% 7.7% 7.5% 7.7% 7.7% 15.2% 7.3% 6.8% 13.6% 6.5% 6.3% 11.9% 11.0% 10.6% 10.7% 10.9% > Only fully in
Slide 11: And leverage favorable trends
And leverage favorable trends PAGE 17 PAGE 17 PAGE 11 CHINA RETAIL SALES GROWTH CHINA CONSUMER 14% >$60 $5.90 - $6.10 SPENDING GROWTH CAGR1 PAGE 11 Global market place presence >11 ~20% CAGR 11.0% 14% $5.90 - $6.10 >$60 > Regional translations with $4.07 CAGR1 >11 ~20% 19.1% CAGR 8.2% 8.4% 18.1% $36
Slide 12: Celanese's value creation models
Celanese’s value creation models Acetyl Chain Materials Solutions LEA DING FUNDAMENTALS CUS T OME R + C O M P L ETE PA C K A G E MARKET GLOBAL BROADEST DIFFERENTIATOR PLACE ASSETS & MATERIALS CAPABILITIES PRESENCE RESOURCES PORTFOLIO #1 OR #2 L OW-COST AD VAN TAGED HI GHLY IN O U R OPERATION S T ECH
Slide 13: Power of the Acetyl Chain
Power of the Acetyl Chain DIFFERENTIAL ACTIONS Unparalleled > Leverage our competitive position as the lowest cost, Choices only fully integrated global acetyl producer Exceptional Execution > Drive differential performance across the acetyl chain Expanded > Track record of exceptional execution Fle
Slide 14: Acetyl Model: Opportunity & Execution
Acetyl Model: Opportunity & Execution 5 Operating Execute Rates Swaps 6 Repeat 4 Optimize operating rates across production network Freight Arbitrage 1 3 Daily competitive Model best netback intelligence on acetic acid molecule (90 days forward) Strategic 2 Purchases Assess regional Demand product d
Slide 15: Power of Materials Solutions
Power of Materials Solutions Customer > Opportunity pipeline will drive growth in Engineered Materials and Intimacy Food Ingredients Pipeline Execution > Cellulose Derivatives will stabilize and then grow profit through managing our landscape and productivity Landscape Management > Strategic Affilia
Slide 16: Materials Model: Opportunity & Execution
Materials Model: Opportunity & Execution 5 Translation Implemented at supplier in Canada with local opportunity 6 Orders fulfilled through support from Celanese regional production Toronto, ON Winona, MN 1 CE US identified opportunity Florence, KY Customer Tokyo, Japan Auburn Hills, MI intimacy 4 3
Slide 17: Those models are delivering strong growth
PAGE PAGE Those 17 17models are delivering strong growth value ADJUSTED EPS GROWTH FREE CASH FLOW (mm) 14% 14% $5.90 $5.90--$6.10 $6.10 >$600 >$600 CAGR CAGR 11 >11% >11% ~20% ~20% CAGR CAGR $4.07 $4.07 $361 $361 5.6% 5.6% 2012 2012 2013 2013 2014 2014 2015F 2015F 2012 2012 2013 2013 2014 2014 2015F
Slide 18: Lets us invest thoughtfully
Lets us invest thoughtfully Strategy for Methanol Investment > Abundant low-cost natural gas in U.S. Gulf Coast > Utilize existing infrastructure > Attractive economics > Reduce methanol pricing volatility Partnership structure > 50:50 joint venture with Mitsui > $100 million credit for existing inf
Slide 19: Delivering strong returns on investment
Peer 1 CE Peer 3 Peer 4 Peer 5 Peer 7 Peer 8 Peer 6 Peer 2 Peer 9 Peer 11 Peer 10 Peer 12 Peer 13 Delivering PAGE strong 9 returns on investment 5-YEAR AVERAGE ROIC (2010-2014) 21.1% 17.7% 17.1% 17.0% 15.9% 15.6% 13.4% 13.3% 12.2% Peer Median 11.1% 10.9% 10.5% 10.0% 8.1% 7% 7.4% 6.6% $4 Peer 1 CE Pe
Slide 20: Predictably returning cash via repurchases
PAGE 21 Predictably PAGE 20 returning cash via repurchases SHARE REPURCHASES (mm) $420 > Deployed $420 million to repurchase 111% 6.6 million shares in Q3 2015 CAGR 50% $250 > Reduced share count by 4.3% CAGR $164 > Increased remaining share repurchase authorization by $1 billion, expect to complete
Slide 21: ...and returning cash via dividends
PAGE 21 ...and returning cash via dividends INCREASED ANNUAL DIVIDEND DIVIDEND PAYOUT RATIO TO $1.20/SHARE $0.30 20% 50% $0.30 18% 20% CAGR 16% 50% 18% CAGR 16% 7% 7% $0.04 $0.04 20122012 2013 2014 2015F 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4
Slide 22: Create opportunities for sensible M&A
Create opportunities for sensible M&A M&A Criteria Leadership Engagement & Core Partnership Attractive top line and Executive Leadership Team earnings • M&A Strategy growth • Prioritization Strong Highly • Final Decision strategic fit synergistic by product or customer MATERIALS ACETYL SOLUTIONS CHA
Slide 23: Disciplined approach...
Disciplined approach... Screening Due Diligence Integration INBOUND • Banks OUTBOUND • Auctions • Bilateral • Internal ideation 100 5,000 8 IN PROCESS INITIAL EVALUATION 15 Decline PROCESS SECONDARY 500 Reject 2 Reject • COOLPOLY® Hold 25 • Acquisition of a process technology Hold Offers made INITIA
Slide 24: Bringing all elements together
PAGE 25 PAGE 25 Bringing all elements together ADJUSTED EARNINGS PER SHARE FREE CASH FLOW Structural (mm) Uniqueness $8.00 - $8.50 $8.00 - $8.50 ~$1,000 ~$1,000 Uniqueness Helps Address $5.90 - $6.10 $5.90 - $6.10 Global >$600 >$600 Challenges $4.07 $4.07 10% 10% 15% 15% Leverage CAGR CAGR CAGR CAGR
Slide 25: Pat Quarles
I N V E S T O R D AY N O V E M B E R 1 3 , 2 0 1 5 Pat Quarles PR ESI D E N T, AC E TY L S & SUPP LY CHA I N
Slide 26: Celanese is an integrated manufacturing company
Celanese is an integrated manufacturing company WE ARE COMMITTED TO: > Providing a safe workplace for our employees and contractors > Serving as a reliable partner for our customers > Being a responsible steward of the environment > Being a low-cost operator Our global integrated manufacturing footp
Slide 27: Culture drives operational excellence
Culture drives operational excellence 17%1 LOWER Safety Process Safety Environmental Reliability > 0.18 total recordable Incident Rate Improvements from 2012 to 2014 On Stream Reliability1 injury rate in 2014 > 16% volatile organic compound 96% 96% 95% 95% > 49% reduction from 0.09 0.11 intensity 93
Slide 28: Everyone owns productivity
Everyone owns productivity Enterprise Approach Robust Pipeline > All inclusive company wide > Three year pipeline to sustain approach productivity process > Cross functional collaboration > Continuous small changes Sustainable Productivity Focus > Large, long term projects > Focus on lasting and sus
Slide 29: Cost savings are visible, tangible & perpetual
Cost savings are visible, tangible & perpetual PRODUCTIVITY: 2016 & BEYOND 17%1 Fixed Costs LOWER > More efficient utility infrastructure > Footprint rationalization > Optimized logistics assets 12% SG&A 11% 9% 9% > Focused service centers for low cost delivery OLD R ANGE 8%–10% > Rationalized IT ap
Slide 30: Multi year productivity planning
Multi year productivity planning FUNCTIONAL AREAS AREAS OF FOCUS GROSS PRODUCTIVITY > Raw material flexibility and yield MANUFACTURING improvement 17% LOWER 1 $200mm > Energy efficiency and reduction TARGET RANGE > Asset utilization and reliability $150mm > Raw material and maintenance 96% sourcing
Slide 31: Power of the Acetyl Chain
Power of the Acetyl Chain DIFFERENTIAL ACTIONS Unparalleled > Leverage our competitive position as the lowest cost, Choices only fully integrated global acetyl producer Exceptional Execution > Drive differential performance across the acetyl chain Expanded > Track record of exceptional execution Fle
Slide 32: Acetyl performance is differential
Acetyl performance is differential 16% 16% 15% 14% NE W R ANG E 12–16% 13% 12% 11% 11% 9% 9% 10% 9% 10% O LD RAN GE 9% 9% 8%–10% $534 $469 $390 $375 $383 $352 $352 $374 $395 $478 $564 $611 $662 $631 $560 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2012 2013 2014 2015 LT M A D J . E B I T LT M A DJ
Slide 33: Advantaged foundational chemistry
Advantaged foundational chemistry Celanese Celanese Paints & Paints Coatings & Coatings 2015F 2015F Net Sales¹ Paints & Coatings Adhesives Adhesives Paints & Coatings Adhesives 25% Paper & Paper Packaging & Packaging 10% Adjusted Adhesives Paper & Packaging 21% Net Adjusted Other Other Sales¹ EBIT 1
Slide 34: Global leader across the value chain
Global leader across the value chain ACID VAM ANHYDRIDE1 VAE # 1 GLOBAL POSITION # 1 GLOBAL POSITION # 1 GLOBAL POSITION 2 # GLOBAL POSITION #1 or #2 position in 85% of Acetyl Chain revenue Estimates of market share, 1includes CE JVs I N V E S T O R D A Y 2 0 1 5 10
Slide 35: Only fully integrated global acetyl producer
Only fully integrated global acetyl producer GLOBAL METHANOL ACID VAM EMULSIONS PRESENCE Celanese BP AMER ICAS LyondellBasell EMEA Wacker CHINA AOC 1 Eastman Sipchem Dairen Unmatched choices regionally and vertically 1 Asia outside of China I N V E S T O R D A Y 2 0 1 5 11
Slide 36: Leading cost position based on AOPlus
Leading cost position based on AOPlus® ACETIC ACID COST CURVE Demand at 70% > Industry leading technology in all regions Nameplate Capacity Utilization > Network provides access to multiple feedstocks CE Singapore (crude oil) CE Nanjing (coal) CE Clear Lake (natural gas) E MEA US GU L F C O AS T A S
Slide 37: Globally integrated assets
Globally integrated assets Edmonton, AB Perstorp, Sweden Boucherville, QC Amsterdam, Netherlands Geleen, Netherlands Meredosia, IL Frankfurt, Germany Sulzbach, Germany Irving, TX Florence, KY Tarragona, Spain Enoree, SC Nanjing, China Clear Lake, TX Bishop, TX Bay City, TX Shanghai, China Cangrejera
Slide 38: European demand drives global value chain
European demand drives global value chain Greater China acetic acid cost* Asia outside China acetic acid cost Western hemisphere acetic acid cost* GREATER CHINA ACETIC ACID COST1 ACID 400 EUROPEGreater China ACID 50 VAM 150 Asia outside China acetic acid cost acetic acid cost* VAM 50 AMERICAS WESTER
Slide 39: Thoughtful execution against aggressive goals
Thoughtful execution against aggressive goals APRIL 2014 OCTOBER 2015 “Looking at recent methanol plant start-ups we remain skeptical that Completed in record time Celanese could get to normal operating rates shortly after starting up its Clear Lake, TX facility in Q4’15.” February 2015 Lowest cost
Slide 40: Increased commercial flexibility
Increased commercial flexibility > More flexible pricing mechanisms enhance active, real-time FREELY NEGOTIATED CONTRACTS EXAMPLE: GLOBAL ACETIC ACID management of margins Global view 2015 Regional view > Global aligned team throughout 80% 80% 80% 80% integrated value chain 60% 60% > Intimate global
Slide 41: Power of the Acetyl Chain
Power of the Acetyl Chain LEADING FUNDAMENTALS DIFFERENTIA L ACTIONS VAL UE #1 OR # 2 IN OUR MA RKETS EXPANDED PRODUCTIVITY FLEXIBILITY = ~$150 L O W-COST OPERATIONS >$50mm/yr >100 kt Acid MILLION A D VANTAG ED T EC HNOLOG Y EXCEPTIONAL UNPARALLELED EXECUTION CHOICES H IGHLY >100 kt Acid IN TEG RATE
Slide 42: Acetyls in over-supply with slower growth
Acetyls in over-supply with slower growth ACETIC ACID INDUSTRY KEY TAKEAWAYS 5.6% Growth 2.7% Growth > Capacity additions have outpaced demand 20,000 kt > Global demand growth in recent years lower than in the past > Demand driven by 10,000 kt 78% – Growing middle class 70% – Increasing demand for h
Slide 43: Overcapacity in Chinese acetic acid and VAM
Overcapacity in Chinese acetic acid and VAM China Acetic Acid ROW1 Acetic Acid Capacity Utilization Capacity Utilization CE China CE 72% ROW1 Other Other BP 77% 63% Wujing Sopo 67% BP ROW1 2011 2011 2012 2012 2013 2013 2014 2014 2015 2015 2011 2011 2012 2012 2013 2013 2014 2014 2015 2015 2011 201120
Slide 44: Location & logistics are critical for acetic acid
Location & logistics are critical for acetic acid FREIGHT TO EUROPE ~$230 ~$190 ~$170 ~$150 ZONE ZONE ZONE ZONE China Capacity by Zone Zone 1 Capacity 4 3 100% 1 53% CE 2 Slide 20: The alignment of the three red dots in the outer- C EL AN ES E N A N J I N G COMPETITORS most ring of the China map don
Slide 45: Chinese producer margins are unsustainable
Chinese producer margins are unsustainable B EL O W C H I N E SE P R O D U C E R C A SH C O ST East China Acid Price ($/mt) China Cash Cost ($/mt) JAN 12 JAN 13 JAN 14 JAN 15 Local producers operate near cash cost in short term, unsustainable long term Source: Celanese estimates; Cash cost = raw mat
Slide 46: Acetyl performance is differential
Acetyl performance is differential Expected range of 12%-16% 12.8% > CE differentiated model has disconnected China acid margins to acetyl chain profitability 8.0% > A more stable China Break Even environment is worth Cash Cost $30mm to $60mm annually JAN 12 JAN 13 JAN 14 JAN 15 A CI D M A R G I N F
Slide 47: Power of the Acetyl Chain
Power of the Acetyl Chain LEADING FUNDAMENTALS DIFFERENTIA L ACTIONS VAL UE G R OW T H #1 OR # 2 IN OUR MA RKETS EXPANDED PRODUCTIVITY FLEXIBILITY L O W-COST = ~$150 + OPERATIONS >$50mm/yr >100 kt Acid MILLION GROWTH OPPORTUNITIES 150 kt VAM A D VANTAG ED 150 kt Acid 50 kt VAE T EC HNOLOG Y EXCEPTIO
Slide 48: Expanding our competitive advantages
Expanding our competitive advantages THROUGH FOUNDATION TECHNOLOGIES THROUGH M&A Raw Materials Foundation Chemistry M&A Criteria > Methanol investment > Acetic acid debottlenecks > Expand low cost position opportunities in USGC – Clear Lake > Enhance customer offering > Upstream CO opportunity > VAM
Slide 49: Expanding Clear Lake acetic acid
Expanding Clear Lake acetic acid USGC ANNUAL PRODUCTION (kt) Reliability, reactor conditions > Successfully implemented low capital and return acid stream capacity expansion at Clear Lake in 2012 Capacity expansion > Additional supply of USGC acetic acid driven by improved reliability, process impro
Slide 50: Expanding Clear Lake VAM
Expanding Clear Lake VAM > 150 kta additional capacity from expansion and CE IS ADVANTAGED VERSUS GREENFIELD ($/TON) improvement options > Lowest capital cost for VAM expansion > Lowest cash cost addition to the VAM market 30% LOWER > Cost advantaged acetic acid integrated feedstock > Leverage US sh
Slide 51: Expanding VAE into Southeast Asia
Expanding VAE into Southeast Asia > Increasing VAE capacity in Asia to ANNUAL CAPACITY (kt) support growth > High value growth segments Singapore expansion (+50kt) – Southeast Asia: paints and coatings – China: paints, coatings, water Nanjing expansion proofing, redispersable powders (+35kt) > Opera
Slide 52: Power of the Acetyl Chain
Power of the Acetyl Chain DIFFERENTIAL ACTIONS ADJUSTED EBIT (mm) Unparalleled $675–$725 Choices Exceptional Execution Expanded 10% Flexibility CAGR Growth Opportunities 2015F Growth Differential Productivity 2018F Model LEADING FUNDAMENTALS GLOBAL LEAD E RS EXPANDED ADJUSTED EBIT MARGIN LEAD I N G
Slide 53: Scott Sutton
I N V E S T O R D AY N O V E M B E R 1 3 , 2 0 1 5 Scott Sutton PR ESI D E N T, M AT E R I A L S SOL UT I ONS
Slide 54: Power of Materials Solutions
Power of Materials Solutions Customer > Opportunity pipeline will drive growth in Engineered Materials and Intimacy Food Ingredients Pipeline Execution > Cellulose Derivatives will stabilize and then grow profit through managing our landscape and productivity Landscape Management > Strategic Affilia
Slide 55: A high margin business
…A high margin business Celanese 2015F Celanese 2015F Net Sales¹ Filtration 36% 36% 36% Adjusted Net Adjusted Automotive Sales¹ EBIT EBIT 36% 24% Margin 24% 24% 34% Industrial 13% 24% 13% 13% Consumer 8% 8% 8% AC E T Y L CHA I N Materials Solutions 13% 6% 6% 6% 6% 4% 4% 3% MAT E RI A L S S OL UT I O
Slide 56: Balanced, global footprint
Balanced, global footprint Polyplastics, Japan Spondon, UK Yokohama, Japan1 Amsterdam, Netherlands Oberhausen, Germany KEP, Korea Winona, MN Frankfurt, Germany Seoul, Korea Lanaken, Belgium Auburn Hills, MI Sulzbach, Germany Nantong, China Irving, TX Nanjing, China Florence, KY Narrows, VA Kaisersla
Slide 57: We lever positive global trends
We lever positive global trends GLOBAL CELANESE TRENDS GROWTH NEEDED CUSTOMER SOLUTIONS GROWING D EMAND F O R VEHICLE S Vehicle Precise Lightweighting Components Food Preservation EL EVATING EN VIRONMENTAL Chemical C ONCE RNS Resistance Calorie Filtration Reduction IN C RE ASED C ONNECTIVITY Aesthet
Slide 58: Opportunity pipeline delivering in a big way
$676 5% 2012 2013 2014 2015F Opportunity pipeline delivering in a big way CAGR 34% 30% 29% 28% $780-$790 Pipeline: EM + FI1 Adjusted EBIT $260-$270 $676 (mm) $260-$270 $253 5% $780-$790 $146 18% 22% 31% 31% CAGR 2012 2013% 2014 2015F CAGR 29% 11 12% 12% $676 34% 24% 30% 2012 2013 2014 2015F 2012 201
Slide 59: Three clear sources of value creation
Three clear sources of value creation HOW WE CREATE VALUE > Our opportunity pipeline drives growth in Engineered Materials 1 OPPORTUNITY PIPELINE: >> EM + FI 34% PIPELINE > Cellulose Derivatives will stabilize and 2 LANDSCAPE >> CELLULOSE 34% then grow profit through landscape MANAGEMENT DERIVATIVES
Slide 60: The best package and the best project system
1 The best package and the best project system COMPLETE PACKAGE MODEL TO DELIVER GROWTH MARKET PLACE PRESENCE STOM CU ER + + = ~$175 GLOBAL ASSETS & RESOURCES RT PIPELINE PA AGGREGATION & EXECUTION MILLION CUSTOMER NEEDS BROADEST MATERIALS MACHINE PORTFOLIO AL RI SOLID EARNINGS TE GROWTH MA DIFFEREN
Slide 61: Celanese adds PEEK to its portfolio
1 Celanese adds PEEK to its portfolio CELANESE POLYMERS High-Performance Polymers (HPP) PEEK PEEK T E M P E R A T U R E (TI1 > 150 °C) LCP Vectra®, Zenite® PI! FP! PPS Fortron® LCP! PET Impet® PEI! PAI! PCT Thermx® PES! PPS! PBT Celanex®, Vandar® PPA! PAR! PSU! PA 6/66! TPC-ET Riteflex® S E R V I C
Slide 62: Deep, differentiated customer engagement
1 Deep, differentiated customer engagement AU TOMOTIV E ECOSY STEM EX A M P L E INJECTION MOLDERS SYSTEM & TIER SUPPLIERS OEMS Influence & Sell across end-user’s ecosystem Team Based SALES & ACCOUNT FIELD DEVELOPMENT OEM MARKET Approach M A NA G E M E N T E N G IN E E R IN G DEV EL OP MENT T E C H N
Slide 63: Pipeline model in action
1 Pipeline model in action NEW TECHNOLOGY INITIATIVES PROJECTS TO BE IMPLEMENTED AND EXTENDED AT CUSTOMERS M&A PROGRAM DAILY EXPERT COMMITTEE CUSTOMER FUNNEL ENGAGEMENT MODEL NUMEROUS Engineers & G E N E RAT I N G 1 0 - 1 5 Projects we SKILL P RO JE C T S D A I LY Technical Sales can win at DOMAINS
Slide 64: CoolPoly LED headlamp
1 CoolPoly® LED headlamp APPLICATION CUSTOMER BENEFITS GROWTH OPPORTUNITIES APPLICATION: INNOVATIVE TRENDS: LED Headlamp SOLUTION: Thermal management is the #1 Thermal management consideration in LED luminaire design combined with low cost MATERIAL: and lightweighting CoolPoly® MARKET POTENTIAL: 3-5
Slide 65: Huawei enclosure separator using nano molding technology (NMT)
1 Huawei enclosure separator using nano molding technology (NMT) APPLICATION CUSTOMER BENEFITS GROWTH OPPORTUNITIES APPLICATION: CUSTOMER BENEFITS: MARKET Isolates external Stable adhesion POTENTIAL: communication performance for New projects for functions from internal co-molding with metals Huawei
Slide 66: Medical polymers for Bespak Easifill Valve
1 Medical polymers for Bespak Easifill Valve APPLICATION CUSTOMER BENEFITS GROWTH OPPORTUNITIES APPLICATION: INNOVATIVE FUTURE PROJECTS: Pressurized metered SOLUTION: Next generation pMDIs dose inhalers (asthma Allows small and COPD) components and tight tolerances to be used in CUSTOMER EXPECTATION
Slide 67: Celanese Innovation Showcase
Celanese Innovation Showcase Tangible examples of the Celanese value creation model I N V E S T O R D A Y 2 0 1 5 15
Slide 68: Three clear sources of value creation
Three clear sources of value creation HOW WE CREATE VALUE > Our opportunity pipeline drives 1 OPPORTUNITY PIPELINE: growth in Engineered Materials PIPELINE >> EM + FI 34% > Cellulose Derivatives will stabilize and 2 LANDSCAPE >> CELLULOSE 34% then grow profit through landscape MANAGEMENT DERIVATIVES
Slide 69: Well positioned in acetate tow
2 Well positioned in acetate tow > Tow is a critical component of a 18% CELANESE cigarette and customers expect: 33% CHINA – Consistent quality – Surety of supply Demand1 2015E 22% EASTMAN – Ability to supply globally – Technical support 1% 11% 14% > Tow is less than 1% of the price OTHER SOLVAY DAI
Slide 70: Global cigarette demand declines slowly
2 Global cigarette demand declines slowly GLOBAL CIGARETTE Global Cigarette DEMAND Demand 1 (trillion (trillion SE1) SE2) 2011-2014 2014-2018 CAGR CAGR -0.7% -1.7% 6.29 6.29 6.19 6.16 5.97 5.90 5.82 5.75 2011 2012 2013 2014 2015F 2016F 2017F 2018F CHINA CIG A RET T ES ROW CIG A RE TTES China cigaret
Slide 71: Cigarette industry is critical to China
2 Cigarette industry is critical to China CHINA TOBACCO CONTRIBUTION CENTRAL COMMITTEE OF THE TO GOVERNMENT REVENUE1 CHINESE COMMUNIST PARTY (Billion Yuan) > Important to the NATIONAL PEOPLE’S 6.5% 6.7% Chinese 125 economy 115 CONGRESS 6.1% 6.3% 5.9% 6.0% 5.8% 106 100 5.82 5.75 STATE COUNCIL 911 1,0
Slide 72: A perfect storm of events
2 A perfect storm of events > Customer tow inventory correction outside of China TEMPORARY > Customer tow inventory correction inside China TEMPORARY > Cigarette inventory correction inside of China TEMPORARY > China increased the sales and production taxes on cigarettes PERMANENT > China tow capaci
Slide 73: ...which is temporarily impacting Celanese
2 …which is temporarily impacting Celanese CELANESE ACETATE (excluding Joint Ventures) 121 118 125 6.7% 115 2011-2015E 106 CAGR 1,000 100 +4% 100 100 97 2011-2015E CAGR 93 -9% 75 83 70 50 2015E 2011 2012 2013 2014 2015E I NDEXED SA LES VOLUM E 1 INDEXED AV ERA G E SA LES PR ICE 1 Making productivity
Slide 74: We are taking action to improve our utilization
2 We are taking action to improve our utilization TOW SUPPLY1 / DEMAND1 (kt) 1,000 98% 98% 98% 92% 84% 3 -3 2011 2012 2013 2014 2015E 2016E 2017E 2018E DEM A ND EXCESS CA PA CIT Y UT ILIZAT ION NET CAPACITY CHANGE YOY (kt) 30 0 -30 Global Cigarette Demand (trillion SE1) TBD TBD 2011 2012 2013 2014 2
Slide 75: Three clear sources of value creation
Three clear sources of value creation HOW WE CREATE VALUE > Our opportunity pipeline drives 1 OPPORTUNITY PIPELINE: growth in Engineered Materials PIPELINE >> EM + FI 34% > Cellulose Derivatives will stabilize and 2 LANDSCAPE >> CELLULOSE 34% then grow profit through landscape MANAGEMENT DERIVATIVES
Slide 76: Our joint ventures are important
3 Our joint ventures are important C E L L U L O SE DERIVAT IV ES ENG INEERED MATER IALS PA RTN ER(S) CNTC Kureha Mitsubishi Gas Daicel Sabic/Duke C E O WN ERS H I P 30% 50% 50% 45% 25%/32.5% (2017) P RI MARY Acetate Tow PPS POM POM PBT Methanol, MTBE PR O D U C TS LCP PPS POM (2017) VALU E Transfer
Slide 77: Polyplastics pipeline example: Camera lens
3 Polyplastics pipeline example: Camera lens APPLICATION INNOVATIVE SOLUTION Camera lens for ADAS Glass lens can be replaced (Advanced Driver with TOPAS® COC (cyclic olefin Assistance Systems) copolymer) with high-productivity. TOPAS® COC has highest durability among optical plastics S URRO UND V I
Slide 78: Success in value creation creates M&A opportunities
Success in value creation creates M&A opportunities > Focus on expansion of pipeline generation capability > Target compounders that have unique products and a customer book > Target Nylon resin and compounds In excess of 50 acquisition opportunities in pipeline, for example… I N V E S T O R D A Y 2
Slide 79: M&A pipeline: Nylon opportunities
M&A pipeline: Nylon opportunities ACQUIRE ACQUIRE SOURCE PRODUCER COMPOUNDER BASE RESINS SOURCE NUMBER OF TARGETS EMEA NA ASIA EMEA NA ASIA EMEA NA ASIA AVAILABILITY Possible 8 10 10 3 3 2 1 Not available 2 1 3 4 1 1 1 7 DIALOGUE In-progress 8 13 6 3 3 2 1 STATUS Initiating contact 2 1 3 1 5 1 1 7 C
Slide 80: Power of Materials Solutions
Power of Materials Solutions ADJUSTED EBIT (mm) Customer Intimacy $1,050–$1,100 Pipeline 20% $788 Execution CAGR Landscape Management 10% Active Affiliate CAGR Management Accelerated M&A 2015F 2015F Opportunity Landscape Affiliate 2018E Pipeline Management Management PIPELINE BUSINESS GROWTH (EM+FI)
Slide 81: Next Up: Celanese Innovation Showcase
Next Up: Celanese Innovation Showcase Tangible examples of the Celanese value creation model I N V E S T O R D A Y 2 0 1 5 29
Slide 82: Chris Jensen
I N V E S T O R D AY N O V E M B E R 1 3 , 2 0 1 5 Chris Jensen C H IEF FI N AN C I AL OF F I CE R
Slide 83: Power of Financial Leadership
Power of Financial Leadership > Significant and growing free cash flow generation driven by financial performance and decreasing capital expenditure needs Growing Free Cash Flow Sustainable > Capital allocation focused on highest-return opportunities Productivity Capital Allocation > Commitment to r
Slide 84: Accelerating free cash flow growth
Accelerating P PAGE 3 PAGEfree 3 cash flow growth ADJUSTED EPS FREE CASH FLOW (mm) 14% 14% $5.90- $5.90- CAGR1 CAGR $6.10 1 $6.10 >$600 >$600 $5.67 $5.67 ~20% ~20% CAGR CAGR $548 $548 $4.50 $4.50 $4.07 $4.07 7.3% $392 $392 $361 $361 2012 20132012 20142013 2015F2014 2015F 2012 20132012 20142013 2015F
Slide 85: Compelling free cash flow yield
Compelling free cash flow yield 3-YEAR AVERAGE FREE CASH FLOW YIELD (2013-20151) 7.3% 5.5% 4.6% 4.1% 3.6% 3.5% 3.5% 3.3% 3.3% Peer Median 3.2% 2.9% 1.9% 1.8% -0.2% -1.9% Peer 1 CE Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 Peer 9 Peer 10 Peer 11 Peer 12 Peer 13 Peer 1 CE Peer 3 Peer 4 Peer 5 P
Slide 86: We are lowering capital spend
We are lowering capital spendPAGE 5 CAPITAL EXPENDITURES1 > Significant capital projects not (mm) anticipated in the near term: $414 – Completed Clear Lake methanol $361 $370 $325- unit ~$350 million $350mm – Completed natural gas boilers in Narrows, Virginia ~$150 million Ongoing Capex $250 - $300m
Slide 87: Sustainable productivity
Sustainable productivity > Raw material flexibility and yield improvement 2015 GROSS PRODUCTIVITY MANUFACTURING > Energy efficiency and reduction > Asset utilization and reliability Business Manufacturing Enterprise > Raw material and maintenance sourcing SUPPLY CHAIN > S&OP process improvement > Lo
Slide 88: Allocating capital to yield highest return
Allocating capital to yield highest return HIGHER RETURNS Organic Growth Utilizes existing infrastructure and enhancements thereto Acquisitions Targets return in excess of cost of capital Share Repurchases Return in excess of the cost of capital Current WACC Repay Debt Returns low single digits Keep
Slide 89: Disciplined spending delivers strong returns
Peer 1 CE Disciplined spending delivers strong returns PAGE 8 CELANESE ROIC CLEAR LAKE METHANOL UNIT IRR OTHER PROJECTS IRR >50% >50% 45% 38% 29% 17.4% 17.7% 17.8% 16.1% Range of 12% WACC 2012 2013 2014 2015 Q3 300 400 500 Project Project Project LTM A B C Long term methanol price $/ton Organic grow
Slide 90: Generating high return on invested capital
Peer 1 CE Peer 3 Peer 4 Peer 5 Peer 7 Peer 8 Peer 6 Peer 2 Peer 9 Peer 11 Peer 10 Peer 12 Peer 13 Generating PAGE 9high return on invested capital 5-YEAR AVERAGE ROIC (2010-2014) 21.1% 17.7% 17.1% 17.0% 15.9% 15.6% 13.4% 13.3% 12.2% Peer Median 11.1% 10.9% 10.5% 10.0% 8.1% 7% 7.4% 6.6% $4 Peer 1 CE
Slide 91: Returning more cash to shareholders
Returning more cash to shareholders PAGE 10 DIVIDEND PAYOUT RATIO AND REPURCHASE YIELD AND SHARE TOTAL DIVIDEND IN $mm REPURCHASE IN $mm 5.1% 20% 18% 16% $175 2.7% $469 $144 2.1% 7% $250 $83 .6% 0.7% $164 $43 $45 er 14 2012 2013 2014 2015F 2012 2013 2014 2015 Q3 LTM I N V E S T O R D A Y 2 0 1 5 10
Slide 92: Shareholder yield leading peers
Shareholder yield leading peers PAGE 11 2015 Q3 LTM SHAREHOLDER YIELD 1.8% 1.4% 1.3% 5.1% 5.2% 5.1% 2.3% 1.3% 1.2% 2.2% 1.7% 2.9% 2.8% 2.5% 2.4% 2.1% 2.3% 0.9% 1.9% 1.5% 0.7% 1.1% 1.2% 1.2% 0.7% 0.4% 0.1% 0.0% 0.0% 0.1% CE Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 Peer 9 Peer 10 Peer 1
Slide 93: Cash flow will fund shareholder remuneration
Cash flow12will fund shareholder remuneration PAGE NET DEBT TO EBITDA RATIO Pro Forma Net Leverage Ratio ~2.3X Expected Flexible Annual Free long-term ~1.3x Net Cash Cash Flow leverage Leverage Ratio Reserve Generation range Year-End 2015 $1.5 - $2.0 billion ~1.2X Bolt-on Annual Stock M&A Annual Rep
Slide 94: Balance sheet supports conservative M&A
PAGE 13 Balance sheet supports conservative M&A > Reduced leverage through earnings growth and debt pay down > Flexible / balanced debt structure > Significant financial flexibility to invest in growth NET DEBT TO EBITDA RATIO CURRENT DEBT MATURITY PROFILE1 (mm) ~2.3X Expected 1.7 long-term 1.5 Revo
Slide 95: History of strong financial performance
History PAGEof PAGE 14strong PAGE 14 14 financial performance… 14% $5.90 5.5% PA P -$6.10 17.7% CAGR 1 ADJUSTED EPS 3 YEAR AVERAGE FCF YIELD 5 YEAR AVERAGE ROIC $4.07 3.3% 12.2% $5.90 $5.90 $5.90 5.5% 5.5% 5.5% 14% 14% 14%-$6.10 -$6.10 -$6.10 17.7% 17.7% 17.7% CAGR CAGR 1 1 CAGR 1 $4.07 $4.07 $4.07
Slide 96: Power of Financial Leadership
PAGE 15 Power of Financial Leadership Complementary ADJUSTED EARNINGS PER SHARE FREE CASH FLOW (mm) Cores ~$1,000 Distinct Value Creation $8.00 - $8.50 dian Models Advantaged >$600 Positions $5.90 - $6.10 Sustainable 15% Productivity CAGR 10% edian High Capital CAGR Returns x 13 2015F Acetyl Materia
Slide 97: Glossary
Glossary For Celanese Non-GAAP measures, please refer to the Non-US GAAP Financial Measures and Supplemental Information documents available under Investor Relations/Financial Information/Non-GAAP Financial Measures on our website, www.celanese.com. > Average Market Cap is the average of quarterly b
Slide 98: Mark Rohr
I N V E S T O R D AY N O V E M B E R 1 3 , 2 0 1 5 Mark Rohr C H AIRM AN & C H I E F E X E CUT I V E OF F I CE R
Slide 99: Unique company with complementary cores
Unique company with complementary cores STRUCTURAL > Advantaged cost > Distinct and leveragable UNIQUENESS > Global network value creation models UNIQUENESS HELPS ADDRESS > Low-growth economic > Currency volatility GLOBAL environment > Low capacity utilization CHALLENGES GROW: LEVERAGE > Global trad
Slide 100: Power of the Acetyl Chain
Power of the Acetyl Chain DIFFERENTIAL ACTIONS Unparalleled > Leverage our competitive position as the lowest cost, Choices only fully integrated global acetyl producer Exceptional Execution > Drive differential performance across the acetyl chain Expanded > Track record of exceptional execution Fle
Slide 101: Power of Materials Solutions
Power of Materials Solutions Customer > Opportunity pipeline will drive growth in Engineered Materials and Intimacy Food Ingredients Pipeline Execution > Cellulose Derivatives will stabilize and then grow profit through managing our landscape and productivity Landscape Management > Strategic Affilia
Slide 102: Disciplined approach to M&A...
Disciplined approach to M&A… Screening Due Diligence Integration INBOUND • Banks OUTBOUND • Auctions • Bilateral • Internal ideation 100 5,000 8 IN PROCESS INITIAL EVALUATION 15 Decline PROCESS SECONDARY 500 Reject 2 Reject • COOLPOLY® Hold 25 • Acquisition of a process technology Hold Offers made I
Slide 103: History of strong financial performance
History PAGEof PAGE 14strong PAGE 14 14 financial performance… 14% $5.90 5.5% PA P -$6.10 17.7% CAGR 1 ADJUSTED EPS 3 YEAR AVERAGE FCF YIELD 5 YEAR AVERAGE ROIC $4.07 3.3% 12.2% $5.90 $5.90 $5.90 5.5% 5.5% 5.5% 14% 14% 14%-$6.10 -$6.10 -$6.10 17.7% 17.7% 17.7% CAGR CAGR 1 1 CAGR 1 $4.07 $4.07 $4.07
Slide 104: Bringing all elements together
PAGE 25 PAGE 25 Bringing all elements together ADJUSTED EARNINGS PER SHARE FREE CASH FLOW Structural (mm) Uniqueness $8.00 - $8.50 $8.00 - $8.50 ~$1,000 ~$1,000 Uniqueness Helps Address $5.90 - $6.10 $5.90 - $6.10 Global >$600 >$600 Challenges $4.07 $4.07 10% 10% 15% 15% Leverage CAGR CAGR CAGR CAGR