Celanese Corporation Reports Record First Quarter Results; Increases Outlook for 2008

Business Wire, April 21, 2008

First quarter highlights:

* Net sales increased 19% to $1,846 million from prior year

* Operating profit increased to $234 million

* Net earnings decreased to $145 million from $201 million in prior year

* Operating EBITDA increased 21% to $381 million

* Diluted EPS - continuing operations increased to $0.87 from $0.70 in prior year

* Adjusted EPS increased to $1.06 from $0.77 in prior year

* 2008 adjusted earnings per share outlook raised to between $3.60 and $3.85 from previous guidance of between $3.40 and $3.70

DALLAS -- Celanese Corporation (NYSE: CE):

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Celanese Corporation (NYSE: CE) today reported record net sales of $1,846 million, a 19 percent increase from the prior year period, primarily due to higher pricing on continued strong demand in its acetyl intermediates and downstream businesses, favorable currency impacts associated with the company's global presence, and increased volumes related to growth in Asia. Operating profit rose to $234 million from $206 million, as the increased sales more than offset higher raw material and energy costs and spending primarily associated with the company's expansion in China. Net earnings were $145 million compared with $201 million in the prior year period. The prior year's net earnings included $79 million of earnings from discontinued operations related to the company's divestiture of its oxo alcohol business and the closure of its Edmonton methanol facility during 2007.

Adjusted earnings per share for the first quarter were a record $1.06 compared with $0.77 in the same period last year. The results excluded $22 million of pre-tax expenses primarily associated with the company's ongoing restructuring efforts. The current period's results also included a $0.04 per share net benefit related to the company's share repurchases executed in the last year. Operating EBITDA was $381 million versus $315 million in the prior year period, also record performance for the company.

"Our first quarter performance illustrates the strength of our integrated business model, our solid operating fundamentals, and our clear focus on growth and value creation," said David Weidman, chairman and chief executive officer. "Despite ongoing sluggish demand in certain North American consumer segments and high raw material and energy costs across our businesses, Celanese delivered record results."

Recent Highlights

* Remains on track to commence additional operations at its Nanjing, China, integrated chemical complex with four previously announced units to begin production within the next year.

* Opened a customer application development center in Shanghai, China, to support growth in the region for Ticona's engineering polymers business.

* The Celanese board of directors authorized the company to repurchase up to $400 million of its Series A common stock. During the quarter, the company repurchased $60 million of its outstanding common shares.

* Upgraded by Moody's Investors Service with a positive outlook and corporate credit rating of 'Ba2' from 'Ba3.'

First Quarter Segment Overview

Advanced Engineered Materials

Advanced Engineered Materials continued to experience strong growth, particularly in Asia and non-transportation applications, with the successful implementation of new product solutions. Net sales increased to $294 million from $262 million in the same period last year, due to higher volumes and positive currency impacts. The increase was partially offset by lower average pricing primarily due to product and geographic mix. Operating profit decreased to $30 million from $36 million in the same period last year as the increased volume was offset by continued high petroleum-based raw material and energy costs, as well as increased investment in Ticona's growth strategy in China. Operating EBITDA decreased to $60 million from $67 million in the prior year period, primarily due to higher raw material and energy costs and lower earnings from its equity affiliates.

Consumer Specialties

Consumer Specialties continued to execute its strategy to provide higher, sustainable earnings. Net sales increased five percent to $282 million compared with the same period last year, driven by higher pricing on continued strong demand, sales from the Acetate Products Limited (APL) acquisition, which was completed in 2007, and positive currency impacts. The increase was partially offset by lower acetate flake volumes resulting from the company's strategic decision to shift flake production to its China ventures. Operating profit was $50 million, $2 million higher than the prior year period's results, as the company continued to drive cost synergies from the APL acquisition. Operating EBITDA increased to $65 million from $60 million in the same period last year as the higher pricing and lower manufacturing costs offset significantly higher energy and raw material costs.

Industrial Specialties

Revitalization of the Industrial Specialties businesses is underway and delivering improved results. Net sales increased to $365 million from $346 million in the same period last year, primarily driven by higher pricing on continued strong demand and favorable currency impacts. The increase was partially offset by lower volumes primarily related to continued softness in North American housing and construction segments, elevated European demand levels in 2007 prior to a German tax law change, and a strategic focus on higher value-added applications. Operating profit was $17 million compared with $12 million in the prior year period as the higher pricing more than offset higher raw material costs, primarily for vinyl acetate monomer, and the lower volumes. Additionally, Industrial Specialties benefited from the positive impact of rebuilding inventory during the quarter following a constrained supply in 2007. Operating EBITDA was $36 million compared with $26 million in the first quarter of 2007.