Financial Data and Key Metrics Changes - The company expects to grow EPS by $1-$2 in 2026, driven by cost actions and success from the EM pipeline, despite a potentially flattish demand environment [7][8] - Working capital has been a source of cash of $250 million in 2025, but a similar level is not expected for 2026 [37][38] - Free cash flow for 2026 is projected to be at least $700 million-$800 million, indicating a sustainable level of cash generation [38] Business Line Data and Key Metrics Changes - Engineered materials volumes were down 8% year-over-year, with standard-grade materials experiencing more significant declines compared to thermoplastic elastomers, which showed growth [19][30] - The company is focusing on cost savings in engineered materials, targeting $30 million-$50 million in additional savings, net of inflation [48][49] Market Data and Key Metrics Changes - Pricing pressure in the acetyl chain has been noted, particularly in Europe, while stabilization in pricing has been observed in China [17][18] - The company is experiencing a lower base of demand compared to historical levels, with no significant accelerated destocking across the board [34][35] Company Strategy and Development Direction - The company is prioritizing cash flow improvement, cost reductions, and top-line growth as key strategies moving into 2026 [7] - A focus on divestitures continues, with a commitment to $1 billion in divestitures by the end of 2027, with the recent Micromax transaction contributing significantly towards this goal [54][55] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving EPS growth despite a challenging demand environment, emphasizing the resilience of the company [78] - The dialogue around anti-involution in China is increasing, with expectations that profitability of assets in China needs to improve [81] Other Important Information - The company recorded a significant impairment related to Zytel and nylon, driven by a reduction in market cap rather than cash flow projections [72] - The Lanaken enclosure is expected to yield $20 million-$30 million in productivity savings by 2027 [42] Q&A Session Summary Question: Early look at 2026 earnings control - Management indicated that priorities for 2026 include increasing cash flow, cost improvements, and driving top-line growth, with an expected EPS growth of $1-$2 [7] Question: EM pricing outlook - Management noted that there are still opportunities for price increases in standard-grade materials and new elements from the pipeline [10] Question: Operating rates in the acetyl chain - Management stated that the lowest-cost assets are running at full capacity, while other assets are flexibly operated based on demand [13][14] Question: Sequential pricing pressure in the acetyl chain - Pricing pressure has been observed in Europe, particularly in downstream products, while stabilization has occurred in China [17][18] Question: Volume decline in engineered materials - The decline is primarily in standard-grade materials, while thermoplastic elastomers have shown resilience [19][30] Question: Free cash flow expectations - Working capital has been a source of cash this year, but similar contributions are not expected in 2026, with a projected free cash flow of $700 million-$800 million [37][38] Question: Divestiture strategy - The company is committed to divesting non-core assets, with the Micromax transaction being a significant step towards the $1 billion target by 2027 [54][55] Question: Impact of European acetate tow closure - Management indicated that the closure will not have ripple effects across the acetates network [98]

Financial Data and Key Metrics Changes - The company reported a solid performance in Q3 2025, with expectations to grow EPS by $1 to $2 in 2026, even in a flat demand environment [6][7]. - Working capital has been a source of cash amounting to $250 million this year, with expectations for free cash flow in 2026 to be at least $700-$800 million [35][37]. Business Line Data and Key Metrics Changes - In the engineered materials segment, consolidated volumes were down 8% year-over-year, primarily affecting engineered thermoplastics like POM and nylon, while thermoplastic elastomers showed resilience [17][28]. - Pricing pressures were noted in the acetyl chain, particularly in Europe, while stabilization was observed in China [15][16]. Market Data and Key Metrics Changes - The company is experiencing a lower demand base compared to historical levels, with no significant accelerated destocking observed across the board, although some pockets exist [31][33]. - The U.S. assets are running at high rates, with the potential for increased utilization if demand improves [85]. Company Strategy and Development Direction - The company is focused on increasing cash flow, improving cost efficiencies, and driving top-line growth, particularly through its EM pipeline [6][7]. - A divestiture target of $1 billion by the end of 2027 has been set, with the recent Micromax transaction contributing significantly towards this goal [51][52]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving EPS growth despite a challenging demand environment, emphasizing the importance of cost actions and pipeline success [6][7]. - The company is actively evaluating its portfolio for potential divestitures, particularly in areas that do not align with its core business strategies [50][51]. Other Important Information - The company announced a closure of the Narco facility, expected to yield $20 million-$30 million in productivity savings by 2027 [40]. - An impairment related to Zytel and nylon was recorded due to a reduction in market cap, not cash flow projections [69][70]. Q&A Session Summary Question: Early look at 2026 earnings control - Management highlighted priorities for 2026, focusing on cash flow, cost improvements, and top-line growth, with an EPS growth expectation of $1 to $2 [6][7]. Question: Operating rates in the acetyl chain - The lowest-cost assets are running at full capacity, while other assets are flexibly operated based on demand [11][12]. Question: Sequential pricing pressure in the acetyl chain - Pricing pressure has been noted in Europe, with stabilization in China and relative stability in the U.S. [15][16]. Question: Volume decline in engineered materials - The decline is mainly in engineered thermoplastics, while thermoplastic elastomers have shown growth [17][28]. Question: Free cash flow expectations for 2026 - Free cash flow is expected to be at least $700-$800 million, with working capital actions contributing to this [35][37]. Question: Divestiture strategy and portfolio actions - The company is committed to divesting non-core assets, with a target of $1 billion by 2027, and is actively pursuing additional divestitures [50][51]. Question: Impact of European acetate tow closure - Management indicated that the closure would not have ripple effects across the acetates network [98].

Q3 2025 Performance - Celanese reported Q3 2025 Free Cash Flow of $375 million[9] - Adjusted EPS for Q3 2025 was $1.34[9] - Adjusted EBIT for Engineered Materials was $200 million, and for Acetyl Chain was $187 million[9] Q4 2025 Outlook - Celanese anticipates an Adjusted EPS guidance of approximately $0.85 - $1.00 for Q4 2025[14] - The company projects Adjusted EBIT guidance for Engineered Materials to be between $165 million and $175 million, and for Acetyl Chain to be between $165 million and $180 million[15] Strategic Actions and Financial Health - Celanese is on track to achieve a Free Cash Flow target range of $700 million to $800 million for FY2025[27] - The company has a strong liquidity position, including $1.4 billion in cash and cash equivalents, along with a $1.75 billion undrawn revolving credit facility[33] - Celanese plans to use the net proceeds from the Micromax divestiture, valued at approximately $500 million, to pay down debt[22] - Celanese expects cost reduction actions to deliver $120 million in cost savings in 2025, with potential incremental opportunities of $50 million - $100 million[38]

Core Insights - Celanese reported a revenue of $2.42 billion for the quarter ended September 2025, reflecting an 8.7% decline year-over-year and falling short of the Zacks Consensus Estimate of $2.46 billion, resulting in a surprise of -1.69% [1] - The company's EPS was $1.34, down from $2.44 in the same quarter last year, but exceeded the consensus estimate of $1.27 by 5.51% [1] Financial Performance Metrics - Net Sales for the Acetyl Chain segment were $1.06 billion, slightly below the estimated $1.07 billion, marking a 10.8% decrease compared to the previous year [4] - Net Sales from Inter segment eliminations were reported at -$26 million, worse than the estimated -$22.39 million, but showed a 13% improvement year-over-year [4] - Engineered Materials segment reported Net Sales of $1.38 billion, matching estimates but down 6.6% from the year-ago quarter [4] - Operating EBITDA for the Acetyl Chain was $250 million, below the average estimate of $258.55 million [4] - Operating EBITDA for Other Activities was -$48 million, slightly better than the estimated -$49.88 million [4] - Engineered Materials segment achieved an Operating EBITDA of $315 million, exceeding the average estimate of $285.07 million [4] Stock Performance - Celanese shares have declined by 13.4% over the past month, contrasting with a 1.3% increase in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Core Insights - Celanese reported quarterly earnings of $1.34 per share, exceeding the Zacks Consensus Estimate of $1.27 per share, but down from $2.44 per share a year ago, indicating an earnings surprise of +5.51% [1] - The company posted revenues of $2.42 billion for the quarter ended September 2025, missing the Zacks Consensus Estimate by 1.69% and down from $2.65 billion year-over-year [2] - Celanese shares have declined approximately 46.6% year-to-date, contrasting with the S&P 500's gain of 15.6% [3] Earnings Outlook - The future performance of Celanese's stock will largely depend on management's commentary during the earnings call and the company's earnings outlook [4] - Current consensus EPS estimate for the upcoming quarter is $0.96 on revenues of $2.32 billion, and for the current fiscal year, it is $4.27 on revenues of $9.7 billion [7] Industry Context - The Chemical - Specialty industry, to which Celanese belongs, is currently ranked in the bottom 34% of over 250 Zacks industries, which may negatively impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that investors should monitor these revisions closely [5][6]

Financial Performance Metrics - Adjusted EBIT is a key performance measure defined as net earnings attributable to Celanese Corporation, adjusted for certain items, with a focus on operational results [13]. - Operating EBITDA, which includes depreciation and amortization, is used to evaluate operating performance relative to peers [13]. - Free cash flow is defined as net cash provided by operations minus capital expenditures, indicating long-term cash generating ability [18]. - Net debt is calculated as total debt minus cash and cash equivalents, providing insight into the company's capital structure [18]. - Return on invested capital (adjusted) is assessed using adjusted EBIT tax-effected, divided by the average of beginning and end of year debt and equity [18]. - The company emphasizes the importance of non-GAAP measures for evaluating financial and operating results, despite their limitations [6]. - The document includes reconciliations of non-GAAP financial measures to GAAP measures, ensuring transparency for investors [7]. Quarterly Financial Results - Net earnings attributable to Celanese Corporation for Q3 '25 were $(1,357) million, a significant decline compared to $197 million in Q2 '25 [19]. - Adjusted EBIT for Q3 '25 was $326 million, down from $342 million in Q2 '25, reflecting a margin of 13.5% [21]. - Operating EBITDA for Q3 '25 was $517 million, with a margin of 21.4%, compared to $530 million in Q2 '25 [22]. - Engineered Materials segment reported an operating loss of $(1,327) million in Q3 '25, with a negative operating margin of 95.9% [21]. - Acetyl Chain segment achieved an operating profit of $135 million in Q3 '25, with a margin of 12.7% [21]. - Total depreciation and amortization expense for Q3 '25 was $194 million, up from $190 million in Q2 '25 [22]. - Certain items attributable to Celanese Corporation amounted to $1,520 million in Q3 '25, compared to $42 million in Q2 '25 [21]. - Interest expense for Q3 '25 was $177 million, consistent with Q2 '25 [19]. - The income tax provision for Q3 '25 was $(7) million, a decrease from $(77) million in Q2 '25 [19]. - Q3 '25 adjusted earnings per share from continuing operations was $(12.39), compared to $1.89 in Q2 '25 [23]. - Net sales for Q3 '25 totaled $2,419 million, a decrease of 4% from $2,532 million in Q2 '25 [27]. - Engineered Materials segment reported net sales of $1,384 million in Q3 '25, down 4% sequentially [27]. - Acetyl Chain segment net sales were $1,061 million in Q3 '25, reflecting a 5% decline from Q2 '25 [27]. - Total company volume decreased by 4% in Q3 '25 compared to Q2 '25, with a price impact of -1% [30]. - Adjusted earnings from continuing operations before tax for Q3 '25 was $156 million, compared to $172 million in Q2 '25 [23]. - The adjusted effective tax rate for 2025 is estimated at 8% [25]. - The company experienced a 1% positive currency impact on total sales in Q3 '25 [30]. - The weighted average diluted shares outstanding for Q3 '25 was 109.6 million [23]. Yearly Financial Overview - The company reported a total adjusted EBIT of $1,625 million for the year 2024, indicating a strong performance compared to previous quarters [19]. - The company plans to update the reconciliation of the GAAP effective tax rate for actual results as part of the year-end reconciliation [26]. - Engineered Materials segment net sales decreased by 7% year-over-year due to a volume decline of 8% and a price decline of 1% for the three months ended September 30, 2025 [34]. - Acetyl Chain segment net sales decreased by 11% year-over-year, driven by a volume decline of 4% and a price decline of 8% for the same period [34]. - Total company net sales decreased by 9% year-over-year, with a volume decline of 6% and a price decline of 4% for the three months ended September 30, 2025 [34]. - Free cash flow for Q3 2025 was $375 million, representing 15.5% of net sales of $2,419 million [38]. - Total debt as of Q3 2025 was $12,854 million, with net debt at $11,414 million [41]. - Cash dividends received in Q3 2025 totaled $80 million, an increase from $62 million in Q2 2025 [40]. - The adjusted return on invested capital for 2024 was 7.7%, with net earnings attributable to Celanese Corporation at $(1,542) million [45]. - The company reported a total of $288 million in cash dividends received for the year 2024 [40]. - The total company net sales for the year ended December 31, 2024, decreased by 6% compared to the previous year, with a volume decline of 1% and a price decline of 4% [37]. - The company experienced a significant asset impairment of $1,486 million in Q3 2025, impacting overall financial performance [42].

Core Viewpoint - Celanese (CE) is anticipated to report a year-over-year decline in earnings due to lower revenues for the quarter ended September 2025, with earnings expected to be $1.27 per share, reflecting a 48% decrease, and revenues projected at $2.46 billion, down 7.1% from the previous year [1][3]. Earnings Expectations - The upcoming earnings report is scheduled for November 6, and the stock may rise if the actual results exceed expectations, while a miss could lead to a decline [2]. - The consensus EPS estimate has been revised down by 4.86% over the last 30 days, indicating a bearish sentiment among analysts regarding the company's earnings prospects [4]. Earnings Surprise Prediction - The Zacks Earnings ESP for Celanese is -1.88%, suggesting that the Most Accurate Estimate is lower than the Zacks Consensus Estimate, which complicates the prediction of an earnings beat [12]. - Celanese currently holds a Zacks Rank of 4, further indicating challenges in predicting a positive earnings surprise [12]. Historical Performance - In the last reported quarter, Celanese had an earnings surprise of +4.35%, with actual earnings of $1.44 per share compared to an expected $1.38 [13]. - Over the past four quarters, the company has beaten consensus EPS estimates three times [14]. Industry Comparison - Green Plains Renewable Energy (GPRE), another player in the Zacks Chemical - Specialty industry, is expected to report a significant decline in earnings, with an EPS estimate of $0.02, reflecting a 94.3% year-over-year change, and revenues expected to be $553.2 million, down 16% [18][19]. - GPRE has seen a substantial revision in its EPS estimate, increasing by 520% over the last 30 days, and currently has a positive Earnings ESP of +135.72%, suggesting a likely earnings beat [19][20].

Core Viewpoint - Celanese Corporation has announced an agreement to divest its Micromax® business, indicating a strategic shift in its portfolio management [1] Group 1: Company Overview - The divestiture of the Micromax® business is part of Celanese's strategy to focus on its core operations and enhance shareholder value [1] - The transaction is expected to streamline operations and allow the company to allocate resources more effectively [1] Group 2: Financial Implications - The financial terms of the agreement have not been disclosed, but the divestiture is anticipated to positively impact Celanese's financial performance in the long term [1] - This move aligns with the company's ongoing efforts to optimize its business structure and improve profitability [1]

Core Viewpoint - Element Solutions Inc has announced a definitive agreement to acquire Micromax from Celanese Corporation for approximately $500 million in cash, with the transaction expected to close in the first quarter of 2026, pending regulatory approvals and customary closing conditions [1] Group 1: Acquisition Details - The acquisition price for Micromax is approximately $500 million in cash, subject to adjustments [1] - The transaction is anticipated to close in the first quarter of 2026, contingent on certain regulatory approvals and customary closing conditions [1]

Core Viewpoint - Celanese plans to cease manufacturing operations at its acetate tow facility in Lanaken, Belgium, during the second half of 2026 due to declining demand and rising operational costs [4] Company Summary - The decision to close the facility follows a strategic review conducted by the company [4] - The communication regarding the closure has been made to employees [4] Industry Summary - The closure reflects broader trends in the industry, including challenges related to demand and cost pressures [4]