Celanese (CE) Declares Force Majeure Due to Supply Disruptions

Core Viewpoint - Celanese Corporation has declared force majeure and instituted sales controls for acetic acid and vinyl acetate monomer (VAM) due to severe supply chain disruptions and operational setbacks affecting key raw material suppliers [1][2]. Group 1: Supply Chain and Production Impact - The company is currently assessing the impact of supply chain disruptions on its Acetyl Chain network in the U.S. Gulf Coast and is taking steps to mitigate production losses [2]. - Celanese is facing production shortfalls of acetic acid and VAM at its U.S. Gulf Coast facilities, expecting a 15-20% unfavorable impact in the second quarter due to ongoing issues [4]. - To maintain customer supply, Celanese is utilizing alternative, higher-cost production sites, sourcing externally, and adjusting logistics, which may increase costs but aims to minimize customer impact [4]. Group 2: Customer Communication and Future Outlook - Celanese expresses regret for any inconvenience caused to customers and is committed to maintaining close communication to minimize the impact [5]. - The company will provide further updates on the resolution of these challenges and their financial implications during the second-quarter earnings report [5]. Group 3: Financial Performance and Projections - Celanese's shares have gained 28.1% over the past year, contrasting with a 10.8% decline in the industry [6]. - The company projects adjusted earnings between $2.60 and $3 per share for the second quarter of 2024, factoring in an expected impact of approximately 30 cents from M&M amortization [7].