Engineered Materials Tom Kelly
Improving the world and everyday life Electronics Automotive Medical Small Appliance Consumer Packaging Industrial 2
PROJECT PIPELINE MODEL CONTINUES TO DIFFERENTIATE EM; DIGITALIZATION STRENGTHENS THE MODEL BY INCREASING SCALABILITY, PREDICTABILITY GROWTH FOCUSED PROGRAMS IN FUTURE MOBILITY, MEDICAL AND CONNECTIVITY POSITION EM FOR OUTSIZED GROWTH AN EXPANDED PORTFOLIO OF SUSTAINABLE OFFERINGS ENABLES GROWTH IN EXISTING AND NEW END MARKETS Themes you will hear today 1 2 3 4 INVESTMENTS IN LOCALIZATION WILL CONTINUE TO SUPPORT DOUBLE-DIGIT GROWTH IN ASIA 3
A broad portfolio and application expertise… …drive outsized, innovation-led growth Automotive Broad Polymer Portfolio Industry Leading Technical Competencies 2020 Net Sales Formulation Development Part & Tool Design Prototyping Part Processing Testing & Analytical Customer Trials Application Development Industrial Consumer Electrical & Electronics Medical Food & Beverage Other Based on internal estimates 4 PEER 1 PEER 2 PEER 3 PEER 4 PEER 5 PEER 6 PEER 7 PEER 8 UNIVERSE OF ENGINEERED POLYMERS CELANESE ENGINEERED MATERIALS 25-30 >20 OF CE BREADTH OF CE BREADTH ~50% ~25%
…add to capabilities set and maximize shareholder value Strategic acquisitions and JV actions... HIGH GROWTH GEOGRAPHY SOLUTION SET KEY END MARKET EXPERTISE ENABLING COMPETENCIES NILIT Plastics Bolstered solution offering and global reach Reduced EM adjusted EBIT from affiliate earnings by half to ~15% Monetized passive investment for $1.6B Agreement to restructure as manufacturing JV; 70 kt of POM offtake Increased CE’s economic interest to 32.5%; EM markets Ibn Sina POM post-expansion Ibn Sina elastomers nylon recycled content recycled content electronics 5
Continuous innovations to expand solution set... Celanese Custom Applications LI-ION 5G UV New in 2020 ...enable growth in new markets 6
…drives growth rates far above the market Pipeline model reinforced by growth programs… R ev en ue / E ar ni ng s (T0-18 months) • Disruptive trends • Growth and profit focus • New to CE / new to customers • Technology roadmaps • Unmet customer needs • Customized material development • Curated opportunities • Differentiated customer experience PARTICIPATE ACCELERATE INCUBATE FUTURE GROWTH PROGRAMS OPPORTUNITY PIPELINE Current (T0) Note: Includes impact of COVID-19 7 MARKET BASED GROWTH
...13-17% per year through 2023 1Excludes Earnings from Affiliates 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Adjusted EBIT (base business)1 Adjusted EBIT margin Project Pipeline & Acquisitions Growth ProgramsPre-Opportunity Pipeline >25% Softer Nilit Omni Asia growth through localization Sustainable portfolio NEXT Model and growth programs lift EM earnings... ~$300M - 500M 8 ~$450M - 700M
Leveraging years of pipeline data to make model more efficient and predictive Opportunity model continues to be foundational Customer Engagement Model Generating Projects Daily Projects to be Implemented and Extended at Customers Projects Aggregated, Prioritized & Executed Projects We Can Win Expert Committee Evalution Fast Fail Global Solution Set and Skill Domains 9
…and remained strong through market disruption Model evolves to support continued innovation... 35% win rate 10% CAGR Implement New Model Debottleneck Model SC A LE T H E M O D E L 47% win rate 16% increase in peak net sales per projectD E LI VE R IN G G R O W TH (P ea k N et S al es )1 TARGETING in Net Sales 2015 2016 700 Run Model Hard Leverage Model Maximize the Model Enhanced Efficiency Program Evolution 2023F2020201920182017 MEMBERS year over year 10 1Peak net sales denote the projected highest net sales by opportunity
Growth programs and technology innovation make EM future ready Programs aligned with mega trends Elements of program that enable growth Connectivity Dedicated Program Teams Forward Looking Objectives Aligned Technology & Product Roadmaps Voice-of-Customer Driven Approach 5G Future Mobility Medical Sustainability 11
Opportunities in future mobility expand the scope for EM solutions Safe navigation Advanced Driver Assistance Systems Lighter and safer Electric vehicle powertrain GUR exceptionally well-positioned in lithium-ion battery separator (LiBS) market CE PEER 1 PEER 2 PEER 3 Number of opportunities with new customers Number of OEM specifications in e-powertrains Growth in pipeline net sales1 from future mobility program3.5x 3.5x 2019 - 2020 24% 2019 - 20202019 - 2020 POWER 12 1Peak net sales denote the projected highest net sales by opportunity
Focused EV program driving growth beyond industry fundamentals... ...with >10% growth in auto business from 2020-2023 RECOVERY IN AUTO BUILDS (CAGR 2020-2023F) GROWING ADDRESSABLE POLYMER CONTENT (kilos per vehicle) (2020) GROWTH IN EM ACCESSIBLE POLYMER MARKET 2020 Internal Combustion Engine Hybrid Electric Battery Electric ~50% ~40% ~0% 13 21 30 Hybrid & Electric Vehicles Internal Combustion Engine CAGR 2020-23F ~11% + = Internal Combustion Engine 2020 Hybrid & Electric Vehicles Battery Electric Vehicles CAGR 2020-23F ~10% 13Based on IHS Markit data and internal estimates
Broad medical-pharma capabilities... Therapeutic AreasCapabilities • Customized POM, GUR, PBT, LCP, EVA grades • Certified biocompatibility grades • Design assistance • Analytical testing • Moldflow® for modeling and analysis • Processing support • Regulatory support • Pharma lab feasibility services • Orthopedic implants • Inhalers and injectors • Medical bags and fluid handling • Long-acting drug delivery • Lab equipment and diagnostics • Surgical instruments Orthopedics Diabetes COPD / Asthma Women’s Health Central Nervous System Disorders E X IS TI N G E M E R G IN G Ophthalmology Portfolio Customer Partnerships Segments ...enable a range of therapeutic solutions Anti-virals (e.g., HIV) Oncology 14
VitalDose® success in drug delivery systems... Industry Focus Improved Efficacy Patient-centered Treatments Fewer Interventions Value-based Healthcare Controlled Release Dynamics D yn am ic D ru g C on ce nt ra ti on Maximum Effective Concentration Minimum Effective Concentration VitalDose® Controlled Release Solution Conventional Formulation ...creating new opportunities for future growth Celanese SolutionControlled Release Excipient ® Time Platform Technology Therapeutic Areas • Drug-eluting implants • Intravaginal rings • Ophthalmic devices • Transdermal patches • Oncology • Anti-virals • Central nervous system disorders • Women’s health • Ophthalmology 15
Connectivity
Multiple mega trends are enabled by 5G... ...driving demand for high-value, tailored solutions …are creating new design requirements Improved reliability Enable smaller and higher performance antenna Broad bandwidth Part consolidation Weight reduction Improved signal integrity EMI shielding Smart City Mobile Devices ManufacturingAutomotive Telecommunication Base Station CONNECTED COMMUNITY: 5G & BEYOND 5G Advancements in ‘smart’ applications... 17
Customizing LCP to meet unique design requirements… Celanese 5G Technology Roadmap D ie le ct ri c C on st an t, D k Dissipation Factor, Df Commercial LCP & PPS ~7 ~ Dk:<3 Dk:<20 Ultra Low Df Zenite® LCP Low Dk Zenite® LCP/ Fortron® PPS High Dk Zenite® LCP Pipeline Growth1 2018 2019 2020 ...across multiple applications to drive innovation 5G Development 2018-20 2x GROWTH 18 1Peak net sales denote the projected highest net sales by opportunity
…to meet exponential global demand expansion Growing portfolio of sustainable offerings… SEGMENTS CURRENT END MARKETS Pipeline Growth1APPROACH CELANESE SOLUTION NEW END MARKETS Highly specified performance polymer Standard polymer Single-use plastics Reduced CO2 footprint Recycled content Biodegradable 2018 2019 2020 Bio-based raw materials • Eco-B POM • Clarifoil® • BlueRidgeTM • China LCP • Ecomid® Nylon • Celanex® PBT • Polifor® PP • Amorphous • Clarifoil® • BlueRidgeTM NEW NEW NEW NEW 2018-20 4x GROWTH 19 1Peak net sales denote the projected highest net sales by opportunity
...to support innovation and deliver out-sized growth Investing in Asia localization... Asia Sales Volume 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Local Development Local Supply Winning with Local Innovators Commercial Excellence 2012- 2020 18% CAGR 2010-20 Production output In capital expenditures over the last 10 years Number of employees in region to support growth6x ~$100M 2010 - 2020 2012 - 20202010 - 2020 2x 20
>25% Adjusted EBIT (in millions) $403 ~$550 $700-750 2020 ~10% 2021-2023 13-17% 2021-2023 Engineered Materials financial outlook Sustainable Portfolio >30% 2023 19% Adjusted EBIT margin 1 2 3 4 Enhanced Pipeline Model Growth Programs Asia Localization 21
