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 10 ). 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, 2017 and 2016 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, 2017 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net sales ā ā 563 1,222 (275 ) 1,510 Cost of sales ā ā (457 ) (966 ) 280 (1,143 ) Gross profit ā ā 106 256 5 367 Selling, general and administrative expenses ā ā (26 ) (70 ) ā (96 ) Amortization of intangible assets ā ā (1 ) (4 ) ā (5 ) Research and development expenses ā ā (7 ) (10 ) ā (17 ) Other (charges) gains, net ā ā (1 ) (2 ) ā (3 ) Foreign exchange gain (loss), net ā ā ā (4 ) ā (4 ) Gain (loss) on disposition of businesses and assets, net ā ā (2 ) ā ā (2 ) Operating profit (loss) ā ā 69 166 5 240 Equity in net earnings (loss) of affiliates 231 233 163 34 (623 ) 38 Interest expense ā (6 ) (24 ) (8 ) 8 (30 ) Refinancing expense ā ā ā ā ā ā Interest income ā 6 1 2 (8 ) 1 Dividend income - cost investments ā ā ā 30 (1 ) 29 Other income (expense), net ā (1 ) 1 3 ā 3 Earnings (loss) from continuing operations before tax 231 232 210 227 (619 ) 281 Income tax (provision) benefit ā (1 ) (8 ) (34 ) 3 (40 ) Earnings (loss) from continuing operations 231 231 202 193 (616 ) 241 Earnings (loss) from operation of discontinued operations ā ā ā (9 ) ā (9 ) Income tax (provision) benefit from discontinued operations ā ā ā 1 ā 1 Earnings (loss) from discontinued operations ā ā ā (8 ) ā (8 ) Net earnings (loss) 231 231 202 185 (616 ) 233 Net (earnings) loss attributable to noncontrolling interests ā ā ā (2 ) ā (2 ) Net earnings (loss) attributable to Celanese Corporation 231 231 202 183 (616 ) 231 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 ā ā 536 1,073 (258 ) 1,351 Cost of sales ā ā (415 ) (865 ) 267 (1,013 ) Gross profit ā ā 121 208 9 338 Selling, general and administrative expenses ā ā (5 ) (66 ) ā (71 ) Amortization of intangible assets ā ā (1 ) (1 ) ā (2 ) Research and development expenses ā ā (8 ) (11 ) ā (19 ) Other (charges) gains, net ā ā (1 ) (3 ) ā (4 ) Foreign exchange gain (loss), net ā ā ā (1 ) ā (1 ) Gain (loss) on disposition of businesses and assets, net ā ā (2 ) 4 ā 2 Operating profit (loss) ā ā 104 130 9 243 Equity in net earnings (loss) of affiliates 222 218 130 34 (569 ) 35 Interest expense ā 9 (36 ) (6 ) 3 (30 ) Refinancing expense ā ā ā ā ā ā Interest income ā 2 1 1 (4 ) ā Dividend income - cost investments ā ā ā 29 ā 29 Other income (expense), net ā (1 ) ā (1 ) ā (2 ) Earnings (loss) from continuing operations before tax 222 228 199 187 (561 ) 275 Income tax (provision) benefit ā (6 ) (10 ) (34 ) (2 ) (52 ) Earnings (loss) from continuing operations 222 222 189 153 (563 ) 223 Earnings (loss) from operation of discontinued operations ā ā ā ā ā ā Income tax (provision) benefit from discontinued operations ā ā ā ā ā ā Earnings (loss) from discontinued operations ā ā ā ā ā ā Net earnings (loss) 222 222 189 153 (563 ) 223 Net (earnings) loss attributable to noncontrolling interests ā ā ā (2 ) ā (2 ) Net earnings (loss) attributable to Celanese Corporation 222 222 189 151 (563 ) 221 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF OPERATIONS Six Months Ended June 30, 2017 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net sales ā ā 1,152 2,399 (570 ) 2,981 Cost of sales ā ā (900 ) (1,932 ) 570 (2,262 ) Gross profit ā ā 252 467 ā 719 Selling, general and administrative expenses ā ā (42 ) (137 ) ā (179 ) Amortization of intangible assets ā ā (2 ) (7 ) ā (9 ) Research and development expenses ā ā (14 ) (20 ) ā (34 ) Other (charges) gains, net ā ā (7 ) (51 ) ā (58 ) Foreign exchange gain (loss), net ā ā ā (4 ) ā (4 ) Gain (loss) on disposition of businesses and assets, net ā ā (4 ) 1 ā (3 ) Operating profit (loss) ā ā 183 249 ā 432 Equity in net earnings (loss) of affiliates 414 407 264 77 (1,077 ) 85 Interest expense ā (12 ) (47 ) (15 ) 15 (59 ) Refinancing expense ā ā ā ā ā ā Interest income ā 12 2 2 (15 ) 1 Dividend income - cost investments ā ā ā 59 (1 ) 58 Other income (expense), net ā (1 ) 1 4 ā 4 Earnings (loss) from continuing operations before tax 414 406 403 376 (1,078 ) 521 Income tax (provision) benefit ā 8 (71 ) (33 ) ā (96 ) Earnings (loss) from continuing operations 414 414 332 343 (1,078 ) 425 Earnings (loss) from operation of discontinued operations ā ā ā (9 ) ā (9 ) Income tax (provision) benefit from discontinued operations ā ā ā 1 ā 1 Earnings (loss) from discontinued operations ā ā ā (8 ) ā (8 ) Net earnings (loss) 414 414 332 335 (1,078 ) 417 Net (earnings) loss attributable to noncontrolling interests ā ā ā (3 ) ā (3 ) Net earnings (loss) attributable to Celanese Corporation 414 414 332 332 (1,078 ) 414 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 ā ā 1,119 2,212 (576 ) 2,755 Cost of sales ā ā (856 ) (1,756 ) 585 (2,027 ) Gross profit ā ā 263 456 9 728 Selling, general and administrative expenses ā ā (22 ) (129 ) ā (151 ) Amortization of intangible assets ā ā (2 ) (2 ) ā (4 ) Research and development expenses ā ā (16 ) (22 ) ā (38 ) Other (charges) gains, net ā ā (1 ) (8 ) ā (9 ) Foreign exchange gain (loss), net ā ā ā 2 ā 2 Gain (loss) on disposition of businesses and assets, net ā ā (3 ) 5 ā 2 Operating profit (loss) ā ā 219 302 9 530 Equity in net earnings (loss) of affiliates 478 492 303 71 (1,271 ) 73 Interest expense ā (6 ) (51 ) (14 ) 8 (63 ) Refinancing expense ā ā (2 ) ā ā (2 ) Interest income ā 4 2 3 (8 ) 1 Dividend income - cost investments ā ā ā 56 ā 56 Other income (expense), net ā (1 ) ā (1 ) ā (2 ) Earnings (loss) from continuing operations before tax 478 489 471 417 (1,262 ) 593 Income tax (provision) benefit ā (11 ) (40 ) (59 ) (2 ) (112 ) Earnings (loss) from continuing operations 478 478 431 358 (1,264 ) 481 Earnings (loss) from operation of discontinued operations ā ā ā 1 ā 1 Income tax (provision) benefit from discontinued operations ā ā ā ā ā ā Earnings (loss) from discontinued operations ā ā ā 1 ā 1 Net earnings (loss) 478 478 431 359 (1,264 ) 482 Net (earnings) loss attributable to noncontrolling interests ā ā ā (4 ) ā (4 ) Net earnings (loss) attributable to Celanese Corporation 478 478 431 355 (1,264 ) 478 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (LOSS) Three Months Ended June 30, 2017 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net earnings (loss) 231 231 202 185 (616 ) 233 Other comprehensive income (loss), net of tax Unrealized gain (loss) on marketable securities 1 1 1 1 (3 ) 1 Foreign currency translation 78 78 96 119 (293 ) 78 Gain (loss) on cash flow hedges 1 1 1 1 (3 ) 1 Pension and postretirement benefits ā ā ā ā ā ā Total other comprehensive income (loss), net of tax 80 80 98 121 (299 ) 80 Total comprehensive income (loss), net of tax 311 311 300 306 (915 ) 313 Comprehensive (income) loss attributable to noncontrolling interests ā ā ā (2 ) ā (2 ) Comprehensive income (loss) attributable to Celanese Corporation 311 311 300 304 (915 ) 311 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 ā ā ā ā ā ā 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 ) ā 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 ā ā ā (2 ) ā (2 ) Comprehensive income (loss) attributable to Celanese Corporation 204 204 171 128 (504 ) 203 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (LOSS) Six Months Ended June 30, 2017 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net earnings (loss) 414 414 332 335 (1,078 ) 417 Other comprehensive income (loss), net of tax Unrealized gain (loss) on marketable securities 1 1 1 1 (3 ) 1 Foreign currency translation 106 106 126 158 (390 ) 106 Gain (loss) on cash flow hedges (1 ) (1 ) (1 ) (1 ) 3 (1 ) Pension and postretirement benefits 5 5 4 6 (15 ) 5 Total other comprehensive income (loss), net of tax 111 111 130 164 (405 ) 111 Total comprehensive income (loss), net of tax 525 525 462 499 (1,483 ) 528 Comprehensive (income) loss attributable to noncontrolling interests ā ā ā (3 ) ā (3 ) Comprehensive income (loss) attributable to Celanese Corporation 525 525 462 496 (1,483 ) 525 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 ā 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 ā ā ā (4 ) ā (4 ) Comprehensive income (loss) attributable to Celanese Corporation 525 525 467 416 (1,408 ) 525 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED CONSOLIDATING BALANCE SHEET As of June 30, 2017 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) ASSETS Current Assets Cash and cash equivalents ā 3 57 451 ā 511 Trade receivables - third party and affiliates ā ā 169 998 (182 ) 985 Non-trade receivables, net 40 511 241 378 (943 ) 227 Inventories, net ā ā 232 583 (44 ) 771 Marketable securities, at fair value ā ā 30 ā ā 30 Other assets ā 77 17 111 (146 ) 59 Total current assets 40 591 746 2,521 (1,315 ) 2,583 Investments in affiliates 2,658 4,273 3,846 776 (10,668 ) 885 Property, plant and equipment, net ā ā 1,079 2,584 ā 3,663 Deferred income taxes ā 7 78 90 (11 ) 164 Other assets ā 778 128 166 (761 ) 311 Goodwill ā ā 314 661 ā 975 Intangible assets, net ā ā 50 252 ā 302 Total assets 2,698 5,649 6,241 7,050 (12,755 ) 8,883 LIABILITIES AND EQUITY Current Liabilities Short-term borrowings and current installments of long-term debt - third party and affiliates ā 169 137 358 (280 ) 384 Trade payables - third party and affiliates 4 ā 254 591 (183 ) 666 Other liabilities ā 94 208 310 (280 ) 332 Income taxes payable ā ā 510 59 (527 ) 42 Total current liabilities 4 263 1,109 1,318 (1,270 ) 1,424 Noncurrent Liabilities Long-term debt ā 2,728 800 171 (768 ) 2,931 Deferred income taxes ā ā ā 176 (11 ) 165 Uncertain tax positions ā ā 3 148 (1 ) 150 Benefit obligations ā ā 584 282 ā 866 Other liabilities ā ā 62 163 ā 225 Total noncurrent liabilities ā 2,728 1,449 940 (780 ) 4,337 Total Celanese Corporation stockholders' equity 2,694 2,658 3,683 4,364 (10,705 ) 2,694 Noncontrolling interests ā ā ā 428 ā 428 Total equity 2,694 2,658 3,683 4,792 (10,705 ) 3,122 Total liabilities and equity 2,698 5,649 6,241 7,050 (12,755 ) 8,883 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED CONSOLIDATING BALANCE SHEET As of December 31, 2016 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) ASSETS Current Assets Cash and cash equivalents ā ā 51 587 ā 638 Trade receivables - third party and affiliates ā ā 107 819 (125 ) 801 Non-trade receivables, net 40 499 249 308 (873 ) 223 Inventories, net ā ā 239 526 (45 ) 720 Marketable securities, at fair value ā ā 30 ā ā 30 Other assets ā 42 25 76 (83 ) 60 Total current assets 40 541 701 2,316 (1,126 ) 2,472 Investments in affiliates 2,548 4,029 3,655 752 (10,132 ) 852 Property, plant and equipment, net ā ā 1,049 2,528 ā 3,577 Deferred income taxes ā ā 91 86 (18 ) 159 Other assets ā 705 133 156 (687 ) 307 Goodwill ā ā 314 482 ā 796 Intangible assets, net ā ā 48 146 ā 194 Total assets 2,588 5,275 5,991 6,466 (11,963 ) 8,357 LIABILITIES AND EQUITY Current Liabilities Short-term borrowings and current installments of long-term debt - third party and affiliates ā 6 133 250 (271 ) 118 Trade payables - third party and affiliates ā ā 226 524 (125 ) 625 Other liabilities ā 58 167 262 (165 ) 322 Income taxes payable ā ā 454 75 (517 ) 12 Total current liabilities ā 64 980 1,111 (1,078 ) 1,077 Noncurrent Liabilities Long-term debt ā 2,647 727 210 (694 ) 2,890 Deferred income taxes ā 16 ā 132 (18 ) 130 Uncertain tax positions ā ā 3 130 (2 ) 131 Benefit obligations ā ā 636 257 ā 893 Other liabilities ā ā 74 142 (1 ) 215 Total noncurrent liabilities ā 2,663 1,440 871 (715 ) 4,259 Total Celanese Corporation stockholders' equity 2,588 2,548 3,571 4,051 (10,170 ) 2,588 Noncontrolling interests ā ā ā 433 ā 433 Total equity 2,588 2,548 3,571 4,484 (10,170 ) 3,021 Total liabilities and equity 2,588 5,275 5,991 6,466 (11,963 ) 8,357 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF CASH FLOWS Six Months Ended June 30, 2017 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net cash provided by (used in) operating activities 415 342 351 283 (901 ) 490 Investing Activities Capital expenditures on property, plant and equipment ā ā (82 ) (34 ) ā (116 ) Acquisitions, net of cash acquired ā (11 ) (12 ) (264 ) 19 (268 ) Proceeds from sale of businesses and assets, net ā ā ā 20 (19 ) 1 Return of capital from subsidiary ā ā 9 ā (9 ) ā Contributions to subsidiary ā ā ā ā ā ā Intercompany loan receipts (disbursements) ā (74 ) (11 ) ā 85 ā Other, net ā ā (1 ) (5 ) ā (6 ) Net cash provided by (used in) investing activities ā (85 ) (97 ) (283 ) 76 (389 ) Financing Activities Net change in short-term borrowings with maturities of 3 months or less ā 161 2 50 (11 ) 202 Proceeds from short-term borrowings ā ā ā 104 ā 104 Repayments of short-term borrowings ā ā ā (55 ) ā (55 ) Proceeds from long-term debt ā ā 74 ā (74 ) ā Repayments of long-term debt ā ā (1 ) (57 ) ā (58 ) Purchases of treasury stock, including related fees (300 ) ā ā ā ā (300 ) Dividends to parent ā (415 ) (306 ) (180 ) 901 ā Contributions from parent ā ā ā ā ā ā Stock option exercises 1 ā ā ā ā 1 Series A common stock dividends (116 ) ā ā ā ā (116 ) Return of capital to parent ā ā ā (9 ) 9 ā (Distributions to) contributions from noncontrolling interests ā ā ā (8 ) ā (8 ) Other, net ā ā (17 ) (2 ) ā (19 ) Net cash provided by (used in) financing activities (415 ) (254 ) (248 ) (157 ) 825 (249 ) Exchange rate effects on cash and cash equivalents ā ā ā 21 ā 21 Net increase (decrease) in cash and cash equivalents ā 3 6 (136 ) ā (127 ) Cash and cash equivalents as of beginning of period ā ā 51 587 ā 638 Cash and cash equivalents as of end of period ā 3 57 451 ā 511 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 ā ā (66 ) (62 ) ā (128 ) Acquisitions, net of cash acquired ā ā ā ā ā ā Proceeds from sale of businesses and assets, net ā ā 1 1 ā 2 Return of capital from subsidiary ā 136 741 ā (877 ) ā Contributions to subsidiary ā ā ā ā ā ā Intercompany loan receipts (disbursements) ā 138 (5 ) 90 (223 ) ā Other, net ā ā (9 ) (3 ) ā (12 ) Net cash provided by (used in) investing activities ā 274 662 26 (1,100 ) (138 ) Financing Activities Net change in short-term borrowings with maturities of 3 months or less ā (345 ) (3 ) ā (5 ) (353 ) Proceeds from short-term borrowings ā ā ā 22 ā 22 Repayments of short-term borrowings ā ā ā (63 ) ā (63 ) Proceeds from long-term debt ā 250 325 ā (405 ) 170 Repayments of long-term debt ā (175 ) (634 ) (7 ) 633 (183 ) Purchases of treasury stock, including related fees (200 ) ā ā ā ā (200 ) Dividends to parent ā (296 ) (260 ) ā 556 ā Contributions from parent ā ā ā ā ā ā Stock option exercises 3 ā ā ā ā 3 Series A common stock dividends (98 ) ā ā ā ā (98 ) Return of capital to parent ā ā ā (877 ) 877 ā (Distributions to) contributions from noncontrolling interests ā ā ā (6 ) ā (6 ) Other, net ā (2 ) (20 ) (2 ) ā (24 ) Net cash provided by (used in) financing activities (295 ) (568 ) (592 ) (933 ) 1,656 (732 ) Exchange rate effects on cash and cash equivalents ā ā ā 2 ā 2 Net increase (decrease) in cash and cash equivalents 2 ā 222 (456 ) ā (232 ) Cash and cash equivalents as of beginning of period ā ā 21 946 ā 967 Cash and cash equivalents as of end of period 2 ā 243 490 ā 735 |