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, 2019 and 2018 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, 2019 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net sales — — 586 1,298 (292 ) 1,592 Cost of sales — — (443 ) (1,020 ) 294 (1,169 ) Gross profit — — 143 278 2 423 Selling, general and administrative expenses — — (39 ) (79 ) — (118 ) Amortization of intangible assets — — (2 ) (4 ) — (6 ) Research and development expenses — — (7 ) (10 ) — (17 ) Other (charges) gains, net — — (5 ) (93 ) — (98 ) Foreign exchange gain (loss), net — — — 1 — 1 Gain (loss) on disposition of businesses and assets, net — — (2 ) 3 — 1 Operating profit (loss) — — 88 96 2 186 Equity in net earnings (loss) of affiliates 209 210 122 34 (536 ) 39 Non-operating pension and other postretirement employee benefit (expense) income — — 16 1 — 17 Interest expense — (9 ) (35 ) (13 ) 28 (29 ) Refinancing expense — (4 ) — — — (4 ) Interest income — 18 11 1 (28 ) 2 Dividend income - equity investments — — — 30 — 30 Other income (expense), net — (4 ) — 2 — (2 ) Earnings (loss) from continuing operations before tax 209 211 202 151 (534 ) 239 Income tax (provision) benefit — (2 ) (23 ) (3 ) — (28 ) Earnings (loss) from continuing operations 209 209 179 148 (534 ) 211 Earnings (loss) from operation of discontinued operations — — (2 ) — — (2 ) Income tax (provision) benefit from discontinued operations — — 1 — — 1 Earnings (loss) from discontinued operations — — (1 ) — — (1 ) Net earnings (loss) 209 209 178 148 (534 ) 210 Net (earnings) loss attributable to noncontrolling interests — — — (1 ) — (1 ) Net earnings (loss) attributable to Celanese Corporation 209 209 178 147 (534 ) 209 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF OPERATIONS Three Months Ended June 30, 2018 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net sales — — 586 1,566 (308 ) 1,844 Cost of sales — — (457 ) (1,171 ) 305 (1,323 ) Gross profit — — 129 395 (3 ) 521 Selling, general and administrative expenses — — (51 ) (85 ) — (136 ) Amortization of intangible assets — — (1 ) (6 ) — (7 ) Research and development expenses — — (7 ) (11 ) — (18 ) Other (charges) gains, net — — — (3 ) — (3 ) Foreign exchange gain (loss), net — — — 3 — 3 Gain (loss) on disposition of businesses and assets, net — — (3 ) 1 — (2 ) Operating profit (loss) — — 67 294 (3 ) 358 Equity in net earnings (loss) of affiliates 344 341 312 53 (994 ) 56 Non-operating pension and other postretirement employee benefit (expense) income — — 24 2 — 26 Interest expense — (5 ) (31 ) (8 ) 12 (32 ) Interest income — 10 2 2 (14 ) — Dividend income - equity investments — — — 32 2 34 Other income (expense), net — (1 ) — 1 — — Earnings (loss) from continuing operations before tax 344 345 374 376 (997 ) 442 Income tax (provision) benefit — (1 ) (69 ) (28 ) 1 (97 ) Earnings (loss) from continuing operations 344 344 305 348 (996 ) 345 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) 344 344 304 349 (996 ) 345 Net (earnings) loss attributable to noncontrolling interests — — — (1 ) — (1 ) Net earnings (loss) attributable to Celanese Corporation 344 344 304 348 (996 ) 344 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF OPERATIONS Six Months Ended June 30, 2019 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net sales — — 1,210 2,671 (602 ) 3,279 Cost of sales — — (901 ) (2,097 ) 595 (2,403 ) Gross profit — — 309 574 (7 ) 876 Selling, general and administrative expenses — — (79 ) (159 ) — (238 ) Amortization of intangible assets — — (4 ) (8 ) — (12 ) Research and development expenses — — (13 ) (20 ) — (33 ) Other (charges) gains, net — — (5 ) (89 ) — (94 ) Foreign exchange gain (loss), net — — — 6 — 6 Gain (loss) on disposition of businesses and assets, net — — (4 ) 5 — 1 Operating profit (loss) — — 204 309 (7 ) 506 Equity in net earnings (loss) of affiliates 546 547 339 77 (1,420 ) 89 Non-operating pension and other postretirement employee benefit (expense) income — — 31 3 — 34 Interest expense — (19 ) (66 ) (20 ) 45 (60 ) Refinancing expense — (4 ) — — — (4 ) Interest income — 31 13 4 (45 ) 3 Dividend income - equity investments — — — 62 — 62 Other income (expense), net — (3 ) — (3 ) — (6 ) Earnings (loss) from continuing operations before tax 546 552 521 432 (1,427 ) 624 Income tax (provision) benefit — (6 ) (30 ) (39 ) 1 (74 ) Earnings (loss) from continuing operations 546 546 491 393 (1,426 ) 550 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) 546 546 489 393 (1,426 ) 548 Net (earnings) loss attributable to noncontrolling interests — — — (2 ) — (2 ) Net earnings (loss) attributable to Celanese Corporation 546 546 489 391 (1,426 ) 546 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF OPERATIONS Six Months Ended June 30, 2018 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net sales — — 1,168 3,138 (611 ) 3,695 Cost of sales — — (905 ) (2,365 ) 611 (2,659 ) Gross profit — — 263 773 — 1,036 Selling, general and administrative expenses — — (110 ) (173 ) — (283 ) Amortization of intangible assets — — (2 ) (11 ) — (13 ) Research and development expenses — — (15 ) (21 ) — (36 ) Other (charges) gains, net — — — (3 ) — (3 ) Foreign exchange gain (loss), net — — — 2 — 2 Gain (loss) on disposition of businesses and assets, net — — (5 ) 3 — (2 ) Operating profit (loss) — — 131 570 — 701 Equity in net earnings (loss) of affiliates 707 701 586 106 (1,986 ) 114 Non-operating pension and other postretirement employee benefit (expense) income — — 47 5 — 52 Interest expense — (10 ) (60 ) (17 ) 22 (65 ) Interest income — 18 4 4 (24 ) 2 Dividend income - equity investments — — — 64 2 66 Other income (expense), net — — — 4 — 4 Earnings (loss) from continuing operations before tax 707 709 708 736 (1,986 ) 874 Income tax (provision) benefit — (2 ) (105 ) (55 ) — (162 ) Earnings (loss) from continuing operations 707 707 603 681 (1,986 ) 712 Earnings (loss) from operation of discontinued operations — — (1 ) (1 ) — (2 ) Income tax (provision) benefit from discontinued operations — — — — — — Earnings (loss) from discontinued operations — — (1 ) (1 ) — (2 ) Net earnings (loss) 707 707 602 680 (1,986 ) 710 Net (earnings) loss attributable to noncontrolling interests — — — (3 ) — (3 ) Net earnings (loss) attributable to Celanese Corporation 707 707 602 677 (1,986 ) 707 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (LOSS) Three Months Ended June 30, 2019 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net earnings (loss) 209 209 178 148 (534 ) 210 Other comprehensive income (loss), net of tax Foreign currency translation gain (loss) (11 ) (11 ) 2 4 5 (11 ) Gain (loss) on cash flow hedges (13 ) (13 ) (3 ) (3 ) 19 (13 ) Total other comprehensive income (loss), net of tax (24 ) (24 ) (1 ) 1 24 (24 ) Total comprehensive income (loss), net of tax 185 185 177 149 (510 ) 186 Comprehensive (income) loss attributable to noncontrolling interests — — — (1 ) — (1 ) Comprehensive income (loss) attributable to Celanese Corporation 185 185 177 148 (510 ) 185 Three Months Ended June 30, 2018 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net earnings (loss) 344 344 304 349 (996 ) 345 Other comprehensive income (loss), net of tax Unrealized gain (loss) on marketable securities — — 5 13 (18 ) — Foreign currency translation gain (loss) (66 ) (66 ) (109 ) (132 ) 307 (66 ) Gain (loss) on cash flow hedges 6 6 5 6 (17 ) 6 Total other comprehensive income (loss), net of tax (60 ) (60 ) (99 ) (113 ) 272 (60 ) Total comprehensive income (loss), net of tax 284 284 205 236 (724 ) 285 Comprehensive (income) loss attributable to noncontrolling interests — — — (1 ) — (1 ) Comprehensive income (loss) attributable to Celanese Corporation 284 284 205 235 (724 ) 284 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (LOSS) Six Months Ended June 30, 2019 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net earnings (loss) 546 546 489 393 (1,426 ) 548 Other comprehensive income (loss), net of tax Foreign currency translation gain (loss) (4 ) (4 ) (16 ) (20 ) 40 (4 ) Gain (loss) on cash flow hedges (16 ) (16 ) 3 5 8 (16 ) Total other comprehensive income (loss), net of tax (20 ) (20 ) (13 ) (15 ) 48 (20 ) Total comprehensive income (loss), net of tax 526 526 476 378 (1,378 ) 528 Comprehensive (income) loss attributable to noncontrolling interests — — — (2 ) — (2 ) Comprehensive income (loss) attributable to Celanese Corporation 526 526 476 376 (1,378 ) 526 Six Months Ended June 30, 2018 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net earnings (loss) 707 707 602 680 (1,986 ) 710 Other comprehensive income (loss), net of tax Unrealized gain (loss) on marketable securities — — 5 13 (18 ) — Foreign currency translation gain (loss) (17 ) (17 ) (46 ) (58 ) 121 (17 ) Gain (loss) on cash flow hedges 5 5 4 5 (14 ) 5 Pension and postretirement benefits gain (loss) 1 1 1 1 (3 ) 1 Total other comprehensive income (loss), net of tax (11 ) (11 ) (36 ) (39 ) 86 (11 ) Total comprehensive income (loss), net of tax 696 696 566 641 (1,900 ) 699 Comprehensive (income) loss attributable to noncontrolling interests — — — (3 ) — (3 ) Comprehensive income (loss) attributable to Celanese Corporation 696 696 566 638 (1,900 ) 696 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED CONSOLIDATING BALANCE SHEET As of June 30, 2019 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) ASSETS Current Assets Cash and cash equivalents — — 51 440 — 491 Trade receivables - third party and affiliates — — 100 991 (120 ) 971 Non-trade receivables, net 40 1,025 1,631 611 (2,975 ) 332 Inventories, net — — 327 739 (55 ) 1,011 Marketable securities, at fair value — — 27 — — 27 Other assets — 28 23 39 (46 ) 44 Total current assets 40 1,053 2,159 2,820 (3,196 ) 2,876 Investments in affiliates 3,760 4,937 4,126 832 (12,696 ) 959 Property, plant and equipment, net — — 1,349 2,293 — 3,642 Operating lease right-of-use assets — — 55 154 — 209 Deferred income taxes — — — 92 (2 ) 90 Other assets — 1,658 176 452 (1,966 ) 320 Goodwill — — 399 684 — 1,083 Intangible assets, net — — 129 198 — 327 Total assets 3,800 7,648 8,393 7,525 (17,860 ) 9,506 LIABILITIES AND EQUITY Current Liabilities Short-term borrowings and current installments of long-term debt - third party and affiliates 910 197 819 752 (2,359 ) 319 Trade payables - third party and affiliates 25 1 270 588 (120 ) 764 Other liabilities — 41 151 268 (158 ) 302 Income taxes payable — — 500 28 (505 ) 23 Total current liabilities 935 239 1,740 1,636 (3,142 ) 1,408 Noncurrent Liabilities Long-term debt — 3,590 1,678 114 (1,938 ) 3,444 Deferred income taxes — 15 85 167 (2 ) 265 Uncertain tax positions 1 2 5 163 — 171 Benefit obligations — — 242 303 — 545 Operating lease liabilities — — 44 148 — 192 Other liabilities — 42 98 125 (38 ) 227 Total noncurrent liabilities 1 3,649 2,152 1,020 (1,978 ) 4,844 Total Celanese Corporation stockholders' equity 2,864 3,760 4,501 4,479 (12,740 ) 2,864 Noncontrolling interests — — — 390 — 390 Total equity 2,864 3,760 4,501 4,869 (12,740 ) 3,254 Total liabilities and equity 3,800 7,648 8,393 7,525 (17,860 ) 9,506 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED CONSOLIDATING BALANCE SHEET As of December 31, 2018 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) ASSETS Current Assets Cash and cash equivalents — — 30 409 — 439 Trade receivables - third party and affiliates — — 96 1,040 (119 ) 1,017 Non-trade receivables, net 40 551 797 697 (1,784 ) 301 Inventories, net — — 329 765 (48 ) 1,046 Marketable securities, at fair value — — 31 — — 31 Other assets — 24 10 37 (31 ) 40 Total current assets 40 575 1,293 2,948 (1,982 ) 2,874 Investments in affiliates 3,503 4,820 4,678 855 (12,877 ) 979 Property, plant and equipment, net — — 1,289 2,430 — 3,719 Deferred income taxes — — — 86 (2 ) 84 Other assets — 1,658 142 461 (1,971 ) 290 Goodwill — — 399 658 — 1,057 Intangible assets, net — — 132 178 — 310 Total assets 3,543 7,053 7,933 7,616 (16,832 ) 9,313 LIABILITIES AND EQUITY Current Liabilities Short-term borrowings and current installments of long-term debt - third party and affiliates 544 333 465 258 (1,039 ) 561 Trade payables - third party and affiliates 13 1 342 583 (120 ) 819 Other liabilities 1 87 267 258 (270 ) 343 Income taxes payable — — 475 88 (507 ) 56 Total current liabilities 558 421 1,549 1,187 (1,936 ) 1,779 Noncurrent Liabilities Long-term debt — 3,104 1,679 127 (1,940 ) 2,970 Deferred income taxes — 15 85 157 (2 ) 255 Uncertain tax positions — — 6 152 — 158 Benefit obligations — — 250 314 — 564 Other liabilities 1 10 99 138 (40 ) 208 Total noncurrent liabilities 1 3,129 2,119 888 (1,982 ) 4,155 Total Celanese Corporation stockholders' equity 2,984 3,503 4,265 5,146 (12,914 ) 2,984 Noncontrolling interests — — — 395 — 395 Total equity 2,984 3,503 4,265 5,541 (12,914 ) 3,379 Total liabilities and equity 3,543 7,053 7,933 7,616 (16,832 ) 9,313 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF CASH FLOWS Six Months Ended June 30, 2019 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net cash provided by (used in) operating activities 636 (31 ) 1,052 635 (1,561 ) 731 Investing Activities Capital expenditures on property, plant and equipment — — (83 ) (61 ) — (144 ) Acquisitions, net of cash acquired — — (31 ) (60 ) — (91 ) Return of capital from subsidiary — — 7 — (7 ) — Intercompany loan receipts (disbursements) — — (653 ) — 653 — Other, net — — 2 (10 ) — (8 ) Net cash provided by (used in) investing activities — — (758 ) (131 ) 646 (243 ) Financing Activities Net change in short-term borrowings with maturities of 3 months or less — 149 3 (4 ) (43 ) 105 Proceeds from short-term borrowings — — — 610 (610 ) — Repayments of short-term borrowings — — — (12 ) — (12 ) Proceeds from long-term debt — 499 — — — 499 Repayments of long-term debt — (335 ) (1 ) (12 ) — (348 ) Purchases of treasury stock, including related fees (488 ) — — — — (488 ) Dividends to parent — (272 ) (251 ) (1,038 ) 1,561 — Common stock dividends (148 ) — — — — (148 ) Return of capital to parent — — — (7 ) 7 — (Distributions to) contributions from noncontrolling interests — — — (7 ) — (7 ) Other, net — (10 ) (24 ) (4 ) — (38 ) Net cash provided by (used in) financing activities (636 ) 31 (273 ) (474 ) 915 (437 ) Exchange rate effects on cash and cash equivalents — — — 1 — 1 Net increase (decrease) in cash and cash equivalents — — 21 31 — 52 Cash and cash equivalents as of beginning of period — — 30 409 — 439 Cash and cash equivalents as of end of period — — 51 440 — 491 CELANESE CORPORATION AND SUBSIDIARIES UNAUDITED INTERIM CONSOLIDATING STATEMENT OF CASH FLOWS Six Months Ended June 30, 2018 Parent Guarantor Issuer Subsidiary Guarantors Non- Guarantors Eliminations Consolidated (In $ millions) Net cash provided by (used in) operating activities 238 432 115 630 (687 ) 728 Investing Activities Capital expenditures on property, plant and equipment — — (109 ) (56 ) — (165 ) Acquisitions, net of cash acquired — — (144 ) — — (144 ) Proceeds from sale of businesses and assets, net — — — 9 — 9 Return of capital from subsidiary — — 218 — (218 ) — Contributions to subsidiary — — (16 ) — 16 — Intercompany loan receipts (disbursements) — (272 ) (10 ) — 282 — Other, net — — (7 ) (24 ) — (31 ) Net cash provided by (used in) investing activities — (272 ) (68 ) (71 ) 80 (331 ) Financing Activities Net change in short-term borrowings with maturities of 3 months or less — 90 11 (51 ) (10 ) 40 Proceeds from short-term borrowings — — — 36 — 36 Repayments of short-term borrowings — — — (39 ) — (39 ) Proceeds from long-term debt — — 272 — (272 ) — Repayments of long-term debt — (12 ) (13 ) (18 ) — (43 ) Purchases of treasury stock, including related fees (100 ) — — — — (100 ) Dividends to parent — (238 ) (449 ) — 687 — Contributions from parent — — — 16 (16 ) — Common stock dividends (136 ) — — — — (136 ) Return of capital to parent — — — (218 ) 218 — (Distributions to) contributions from noncontrolling interests — — — (8 ) — (8 ) Other, net — — (5 ) (1 ) — (6 ) Net cash provided by (used in) financing activities (236 ) (160 ) (184 ) (283 ) 607 (256 ) Exchange rate effects on cash and cash equivalents — — — (9 ) — (9 ) Net increase (decrease) in cash and cash equivalents 2 — (137 ) 267 — 132 Cash and cash equivalents as of beginning of period — — 230 346 — 576 Cash and cash equivalents as of end of period 2 — 93 613 — 708 |