Consolidating Guarantor Financial Information | Consolidating Guarantor Financial Information The Senior Notes were issued by Celanese US ("Issuer") and are guaranteed by Celanese Corporation ("Parent Guarantor") and the Subsidiary Guarantors ( Note 8 ). The Issuer and Subsidiary Guarantors are 100% owned subsidiaries of the Parent Guarantor. The Parent Guarantor and Subsidiary Guarantors have guaranteed the Notes fully and unconditionally and jointly and severally. For cash management purposes, the Company transfers cash between the Parent Guarantor, Issuer, Subsidiary Guarantors and non-guarantors through intercompany financing arrangements, contributions or declaration of dividends between the respective parent and its subsidiaries. The transfer of cash under these activities facilitates the ability of the recipient to make specified third-party payments for principal and interest on the Company's outstanding debt, Common Stock dividends and Common Stock repurchases. The unaudited interim consolidating statements of cash flows for the six months ended June 30, 2016 and 2015 present such intercompany financing activities, contributions and dividends consistent with how such activity would be presented in a stand-alone statement of cash flows. The Company has not presented separate financial information and other disclosures for each of its Subsidiary Guarantors because it believes such financial information and other disclosures would not provide investors with any additional information that would be material in evaluating the sufficiency of the guarantees. The unaudited interim consolidating financial statements for the Parent Guarantor, the Issuer, the Subsidiary Guarantors and the non-guarantors are as follows: CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF OPERATIONS Three Months Ended June 30, 2016 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net sales — — 536 1,073 (258 ) 1,351 Cost of sales — — (415 ) (865 ) 267 (1,013 ) Gross profit — — 121 208 9 338 Selling, general and administrative expenses — — (5 ) (66 ) — (71 ) Amortization of intangible assets — — (1 ) (1 ) — (2 ) Research and development expenses — — (8 ) (11 ) — (19 ) Other (charges) gains, net — — (1 ) (3 ) — (4 ) Foreign exchange gain (loss), net — — — (1 ) — (1 ) Gain (loss) on disposition of businesses and assets, net — — (2 ) 4 — 2 Operating profit (loss) — — 104 130 9 243 Equity in net earnings (loss) of affiliates 222 218 130 34 (569 ) 35 Interest expense — 9 (36 ) (6 ) 3 (30 ) Refinancing expense — — — — — — Interest income — 2 1 1 (4 ) — Dividend income - cost investments — — — 29 — 29 Other income (expense), net — (1 ) — (1 ) — (2 ) Earnings (loss) from continuing operations before tax 222 228 199 187 (561 ) 275 Income tax (provision) benefit — (6 ) (10 ) (34 ) (2 ) (52 ) Earnings (loss) from continuing operations 222 222 189 153 (563 ) 223 Earnings (loss) from operation of discontinued operations — — — — — — Income tax (provision) benefit from discontinued operations — — — — — — Earnings (loss) from discontinued operations — — — — — — Net earnings (loss) 222 222 189 153 (563 ) 223 Net (earnings) loss attributable to noncontrolling interests — — — (2 ) — (2 ) Net earnings (loss) attributable to Celanese Corporation 222 222 189 151 (563 ) 221 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF OPERATIONS Three Months Ended June 30, 2015 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net sales — — 674 1,174 (371 ) 1,477 Cost of sales — — (474 ) (1,011 ) 383 (1,102 ) Gross profit — — 200 163 12 375 Selling, general and administrative expenses — — (29 ) (77 ) — (106 ) Amortization of intangible assets — — (2 ) (1 ) — (3 ) Research and development expenses — — (49 ) (10 ) — (59 ) Other (charges) gains, net — — — (10 ) — (10 ) Foreign exchange gain (loss), net — — — (3 ) — (3 ) Gain (loss) on disposition of businesses and assets, net — — (1 ) (5 ) — (6 ) Operating profit (loss) — — 119 57 12 188 Equity in net earnings (loss) of affiliates 206 244 114 35 (559 ) 40 Interest expense — (41 ) (8 ) (8 ) 27 (30 ) Refinancing expense — — — — — — Interest income — 5 20 3 (27 ) 1 Dividend income - cost investments — — — 26 — 26 Other income (expense), net — — 1 1 — 2 Earnings (loss) from continuing operations before tax 206 208 246 114 (547 ) 227 Income tax (provision) benefit (1 ) (2 ) (29 ) 9 (1 ) (24 ) Earnings (loss) from continuing operations 205 206 217 123 (548 ) 203 Earnings (loss) from operation of discontinued operations — — (3 ) — — (3 ) Income tax (provision) benefit from discontinued operations — — 1 — — 1 Earnings (loss) from discontinued operations — — (2 ) — — (2 ) Net earnings (loss) 205 206 215 123 (548 ) 201 Net (earnings) loss attributable to noncontrolling interests — — — 4 — 4 Net earnings (loss) attributable to Celanese Corporation 205 206 215 127 (548 ) 205 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF OPERATIONS Six Months Ended June 30, 2016 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net sales — — 1,119 2,212 (576 ) 2,755 Cost of sales — — (856 ) (1,756 ) 585 (2,027 ) Gross profit — — 263 456 9 728 Selling, general and administrative expenses — — (22 ) (129 ) — (151 ) Amortization of intangible assets — — (2 ) (2 ) — (4 ) Research and development expenses — — (16 ) (22 ) — (38 ) Other (charges) gains, net — — (1 ) (8 ) — (9 ) Foreign exchange gain (loss), net — — — 2 — 2 Gain (loss) on disposition of businesses and assets, net — — (3 ) 5 — 2 Operating profit (loss) — — 219 302 9 530 Equity in net earnings (loss) of affiliates 478 492 303 71 (1,271 ) 73 Interest expense — (6 ) (51 ) (14 ) 8 (63 ) Refinancing expense — — (2 ) — — (2 ) Interest income — 4 2 3 (8 ) 1 Dividend income - cost investments — — — 56 — 56 Other income (expense), net — (1 ) — (1 ) — (2 ) Earnings (loss) from continuing operations before tax 478 489 471 417 (1,262 ) 593 Income tax (provision) benefit — (11 ) (40 ) (59 ) (2 ) (112 ) Earnings (loss) from continuing operations 478 478 431 358 (1,264 ) 481 Earnings (loss) from operation of discontinued operations — — — 1 — 1 Income tax (provision) benefit from discontinued operations — — — — — — Earnings (loss) from discontinued operations — — — 1 — 1 Net earnings (loss) 478 478 431 359 (1,264 ) 482 Net (earnings) loss attributable to noncontrolling interests — — — (4 ) — (4 ) Net earnings (loss) attributable to Celanese Corporation 478 478 431 355 (1,264 ) 478 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF OPERATIONS Six Months Ended June 30, 2015 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net sales — — 1,332 2,307 (712 ) 2,927 Cost of sales — — (905 ) (1,995 ) 729 (2,171 ) Gross profit — — 427 312 17 756 Selling, general and administrative expenses — — (53 ) (151 ) — (204 ) Amortization of intangible assets — — (3 ) (3 ) — (6 ) Research and development expenses — — (59 ) (20 ) — (79 ) Other (charges) gains, net — — (3 ) (12 ) — (15 ) Foreign exchange gain (loss), net — — — — — — Gain (loss) on disposition of businesses and assets, net — — (3 ) (4 ) — (7 ) Operating profit (loss) — — 306 122 17 445 Equity in net earnings (loss) of affiliates 441 523 206 75 (1,157 ) 88 Interest expense — (84 ) (13 ) (20 ) 60 (57 ) Refinancing expense — — — — — — Interest income — 13 39 9 (60 ) 1 Dividend income - cost investments — — — 54 — 54 Other income (expense), net — — 1 1 — 2 Earnings (loss) from continuing operations before tax 441 452 539 241 (1,140 ) 533 Income tax (provision) benefit — (11 ) (82 ) (1 ) (2 ) (96 ) Earnings (loss) from continuing operations 441 441 457 240 (1,142 ) 437 Earnings (loss) from operation of discontinued operations — — (3 ) — — (3 ) Income tax (provision) benefit from discontinued operations — — 1 — — 1 Earnings (loss) from discontinued operations — — (2 ) — — (2 ) Net earnings (loss) 441 441 455 240 (1,142 ) 435 Net (earnings) loss attributable to noncontrolling interests — — — 6 — 6 Net earnings (loss) attributable to Celanese Corporation 441 441 455 246 (1,142 ) 441 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (LOSS) Three Months Ended June 30, 2016 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net earnings (loss) 222 222 189 153 (563 ) 223 Other comprehensive income (loss), net of tax Unrealized gain (loss) on marketable securities — — — — — — Foreign currency translation (18 ) (18 ) (18 ) (24 ) 60 (18 ) Gain (loss) on cash flow hedges 1 1 1 1 (3 ) 1 Pension and postretirement benefits (1 ) (1 ) (1 ) — 2 (1 ) Total other comprehensive income (loss), net of tax (18 ) (18 ) (18 ) (23 ) 59 (18 ) Total comprehensive income (loss), net of tax 204 204 171 130 (504 ) 205 Comprehensive (income) loss attributable to noncontrolling interests — — — (2 ) — (2 ) Comprehensive income (loss) attributable to Celanese Corporation 204 204 171 128 (504 ) 203 Three Months Ended June 30, 2015 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net earnings (loss) 205 206 215 123 (548 ) 201 Other comprehensive income (loss), net of tax Unrealized gain (loss) on marketable securities (1 ) (1 ) (1 ) (1 ) 3 (1 ) Foreign currency translation 37 37 56 74 (167 ) 37 Gain (loss) on cash flow hedges 1 1 1 1 (3 ) 1 Pension and postretirement benefits 4 4 3 4 (11 ) 4 Total other comprehensive income (loss), net of tax 41 41 59 78 (178 ) 41 Total comprehensive income (loss), net of tax 246 247 274 201 (726 ) 242 Comprehensive (income) loss attributable to noncontrolling interests — — — 4 — 4 Comprehensive income (loss) attributable to Celanese Corporation 246 247 274 205 (726 ) 246 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (LOSS) Six Months Ended June 30, 2016 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net earnings (loss) 478 478 431 359 (1,264 ) 482 Other comprehensive income (loss), net of tax Unrealized gain (loss) on marketable securities 1 1 — 1 (2 ) 1 Foreign currency translation 46 46 36 58 (140 ) 46 Gain (loss) on cash flow hedges 1 1 1 1 (3 ) 1 Pension and postretirement benefits (1 ) (1 ) (1 ) 1 1 (1 ) Total other comprehensive income (loss), net of tax 47 47 36 61 (144 ) 47 Total comprehensive income (loss), net of tax 525 525 467 420 (1,408 ) 529 Comprehensive (income) loss attributable to noncontrolling interests — — — (4 ) — (4 ) Comprehensive income (loss) attributable to Celanese Corporation 525 525 467 416 (1,408 ) 525 Six Months Ended June 30, 2015 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net earnings (loss) 441 441 455 240 (1,142 ) 435 Other comprehensive income (loss), net of tax Unrealized gain (loss) on marketable securities (1 ) (1 ) (1 ) (1 ) 3 (1 ) Foreign currency translation (119 ) (119 ) (114 ) (137 ) 370 (119 ) Gain (loss) on cash flow hedges 3 3 6 3 (12 ) 3 Pension and postretirement benefits 1 1 — 4 (5 ) 1 Total other comprehensive income (loss), net of tax (116 ) (116 ) (109 ) (131 ) 356 (116 ) Total comprehensive income (loss), net of tax 325 325 346 109 (786 ) 319 Comprehensive (income) loss attributable to noncontrolling interests — — — 6 — 6 Comprehensive income (loss) attributable to Celanese Corporation 325 325 346 115 (786 ) 325 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED CONSOLIDATING BALANCE SHEET As of June 30, 2016 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) ASSETS Current Assets Cash and cash equivalents 2 — 243 490 — 735 Trade receivables - third party and affiliates — — 128 807 (143 ) 792 Non-trade receivables, net 38 537 213 327 (898 ) 217 Inventories, net — — 224 453 (41 ) 636 Deferred income taxes — — — — — — Marketable securities, at fair value — — 35 — — 35 Other assets — 37 17 55 (68 ) 41 Total current assets 40 574 860 2,132 (1,150 ) 2,456 Investments in affiliates 2,562 4,082 3,511 747 (10,060 ) 842 Property, plant and equipment, net — — 1,015 2,573 — 3,588 Deferred income taxes — — 192 68 (23 ) 237 Other assets — 280 144 227 (358 ) 293 Goodwill — — 314 397 — 711 Intangible assets, net — — 50 71 — 121 Total assets 2,602 4,936 6,086 6,215 (11,591 ) 8,248 LIABILITIES AND EQUITY Current Liabilities Short-term borrowings and current installments of long-term debt - third party and affiliates — 40 130 200 (251 ) 119 Trade payables - third party and affiliates — — 238 455 (142 ) 551 Other liabilities — 54 180 230 (163 ) 301 Deferred income taxes — — — — — — Income taxes payable — — 553 115 (552 ) 116 Total current liabilities — 94 1,101 1,000 (1,108 ) 1,087 Noncurrent Liabilities Long-term debt — 2,253 401 177 (367 ) 2,464 Deferred income taxes — 25 — 114 (23 ) 116 Uncertain tax positions — 2 16 136 — 154 Benefit obligations — — 920 227 — 1,147 Other liabilities — — 80 149 — 229 Total noncurrent liabilities — 2,280 1,417 803 (390 ) 4,110 Total Celanese Corporation stockholders' equity 2,602 2,562 3,568 3,963 (10,093 ) 2,602 Noncontrolling interests — — — 449 — 449 Total equity 2,602 2,562 3,568 4,412 (10,093 ) 3,051 Total liabilities and equity 2,602 4,936 6,086 6,215 (11,591 ) 8,248 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED CONSOLIDATING BALANCE SHEET As of December 31, 2015 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) ASSETS Current Assets Cash and cash equivalents — — 21 946 — 967 Trade receivables - third party and affiliates — — 132 722 (148 ) 706 Non-trade receivables, net 37 580 298 522 (1,152 ) 285 Inventories, net — — 258 474 (50 ) 682 Deferred income taxes — — 19 68 (19 ) 68 Marketable securities, at fair value — — 30 — — 30 Other assets — 12 28 40 (31 ) 49 Total current assets 37 592 786 2,772 (1,400 ) 2,787 Investments in affiliates 2,341 3,947 3,909 738 (10,097 ) 838 Property, plant and equipment, net — — 1,001 2,608 — 3,609 Deferred income taxes — 2 178 42 — 222 Other assets — 418 151 227 (496 ) 300 Goodwill — — 314 391 — 705 Intangible assets, net — — 51 74 — 125 Total assets 2,378 4,959 6,390 6,852 (11,993 ) 8,586 LIABILITIES AND EQUITY Current Liabilities Short-term borrowings and current installments of long-term debt - third party and affiliates — 479 181 213 (360 ) 513 Trade payables - third party and affiliates — — 240 495 (148 ) 587 Other liabilities — 28 281 283 (262 ) 330 Deferred income taxes — 26 — 23 (19 ) 30 Income taxes payable — — 537 116 (563 ) 90 Total current liabilities — 533 1,239 1,130 (1,352 ) 1,550 Noncurrent Liabilities Long-term debt — 2,078 706 187 (503 ) 2,468 Deferred income taxes — — — 136 — 136 Uncertain tax positions — 7 29 131 — 167 Benefit obligations — — 960 229 — 1,189 Other liabilities — — 93 155 (1 ) 247 Total noncurrent liabilities — 2,085 1,788 838 (504 ) 4,207 Total Celanese Corporation stockholders' equity 2,378 2,341 3,363 4,433 (10,137 ) 2,378 Noncontrolling interests — — — 451 — 451 Total equity 2,378 2,341 3,363 4,884 (10,137 ) 2,829 Total liabilities and equity 2,378 4,959 6,390 6,852 (11,993 ) 8,586 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF CASH FLOWS Six Months Ended June 30, 2016 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net cash provided by (used in) operating activities 297 294 152 449 (556 ) 636 Investing Activities Capital expenditures on property, plant and equipment — — (66 ) (62 ) — (128 ) Acquisitions, net of cash acquired — — — — — — Proceeds from sale of businesses and assets, net — — 1 1 — 2 Capital expenditures related to Fairway Methanol LLC — — — — — — Return of capital from subsidiary — 136 741 — (877 ) — Contributions to subsidiary — — — — — — Intercompany loan receipts (disbursements) — 138 (5 ) 90 (223 ) — Other, net — — (9 ) (3 ) — (12 ) Net cash provided by (used in) investing activities — 274 662 26 (1,100 ) (138 ) Financing Activities Net change in short-term borrowings with maturities of 3 months or less — (345 ) (3 ) — (5 ) (353 ) Proceeds from short-term borrowings — — — 22 — 22 Repayments of short-term borrowings — — — (63 ) — (63 ) Proceeds from long-term debt — 250 325 — (405 ) 170 Repayments of long-term debt — (175 ) (634 ) (7 ) 633 (183 ) Purchases of treasury stock, including related fees (200 ) — — — — (200 ) Dividends to parent — (296 ) (260 ) — 556 — Contributions from parent — — — — — — Stock option exercises 3 — — — — 3 Series A common stock dividends (98 ) — — — — (98 ) Return of capital to parent — — — (877 ) 877 — (Distributions to) contributions from noncontrolling interests — — — (6 ) — (6 ) Other, net — (2 ) (20 ) (2 ) — (24 ) Net cash provided by (used in) financing activities (295 ) (568 ) (592 ) (933 ) 1,656 (732 ) Exchange rate effects on cash and cash equivalents — — — 2 — 2 Net increase (decrease) in cash and cash equivalents 2 — 222 (456 ) — (232 ) Cash and cash equivalents as of beginning of period — — 21 946 — 967 Cash and cash equivalents as of end of period 2 — 243 490 — 735 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF CASH FLOWS Six Months Ended June 30, 2015 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net cash provided by (used in) operating activities 83 45 285 306 (166 ) 553 Investing Activities Capital expenditures on property, plant and equipment — — (74 ) (43 ) — (117 ) Acquisitions, net of cash acquired — — (3 ) — — (3 ) Proceeds from sale of businesses and assets, net — — — — — — Capital expenditures related to Fairway Methanol LLC — — (9 ) (201 ) — (210 ) Return of capital from subsidiary — — — — — — Contributions to subsidiary — — (60 ) — 60 — Intercompany loan receipts (disbursements) — 3 (25 ) (15 ) 37 — Other, net — — (12 ) (12 ) — (24 ) Net cash provided by (used in) investing activities — 3 (183 ) (271 ) 97 (354 ) Financing Activities Net change in short-term borrowings with maturities of 3 months or less — 25 (1 ) (1 ) (25 ) (2 ) Proceeds from short-term borrowings — — — 26 — 26 Repayments of short-term borrowings — — — (39 ) — (39 ) Proceeds from long-term debt — 15 — — (15 ) — Repayments of long-term debt — (5 ) (3 ) (7 ) 3 (12 ) Purchases of treasury stock, including related fees — — — — — — Dividends to parent — (83 ) (83 ) — 166 — Contributions from parent — — — 60 (60 ) — Stock option exercises 2 — — — — 2 Series A common stock dividends (84 ) — — — — (84 ) Return of capital to parent — — — — — — (Distributions to) contributions from noncontrolling interests — — — 155 — 155 Other, net — — (10 ) (1 ) — (11 ) Net cash provided by (used in) financing activities (82 ) (48 ) (97 ) 193 69 35 Exchange rate effects on cash and cash equivalents — — — (26 ) — (26 ) Net increase (decrease) in cash and cash equivalents 1 — 5 202 — 208 Cash and cash equivalents as of beginning of period — — 110 670 — 780 Cash and cash equivalents as of end of period 1 — 115 872 — 988 |