2. TAB L E O F CO N T EN T S 2
Table of Contents
Disclaimers ......................................................................................................... 3
Overview and Value Proposition ....................................................................... 5
Affiliate Overview ............................................................................................ 10
Key Financial Data ........................................................................................... 18
Accounting for Equity and Cost Investments ................................................. 22
3. D IS CL AI M ER S 3
Disclaimers
Celanese Corporation (the “Company”) is providing the financial information contained herein
for informational purposes only. Certain financial information appearing in this White Paper
has not been audited and is identified as such. Such unaudited financial information is based on
internal financial data furnished to management and should not be taken as representative of
the Company’s future consolidated results of operations or financial position. Such unaudited
financial information should be considered in combination with our audited financial state-
ments. While the Company believes that the financial information disclosed herein is accurate
as of the dates presented, the Company in no way guarantees that such information is complete
or accurate, does not assume any obligation to update or correct such information and explicitly
disclaims any duty to do so.
Forward-Looking Statements
This White Paper may contain “forward-looking statements,” which include information
concerning the Company’s plans, objectives, goals, strategies, future revenues or performance,
capital expenditures, financing needs and other information that is not historical information.
When used in this White Paper, the words “estimates,” “expects,” “anticipates,” “projects,” “plans,”
“intends,” “believes,” and variations of such words or similar expressions are intended to identify
forward-looking statements. All forward-looking statements are based upon current expectations
and beliefs and various assumptions. There can be no assurance that the Company will realize
these expectations or that these beliefs will prove correct.
There are a number of risks and uncertainties that could cause actual results to differ materially
from the forward-looking statements contained in this White Paper. Numerous factors, many
of which are beyond the Company’s control, could cause actual results to differ materially from
those expressed as forward-looking statements. Certain of these risk factors are discussed in the
Company’s Annual Report on Form 10K. Any forward-looking statement speaks only as of the
date on which it is made, and the Company undertakes no obligation to update any forward-
looking statement to reflect events or circumstances after the date on which it is made or to
reflect the occurrence of anticipated or unanticipated events or circumstances.
Successor
Represents our audited consolidated financial position as of December 31, 2005 and 2004 and its
audited consolidated results of operations and cash flows for the year ended December 31, 2005
and the nine months ended December 31, 2004. These consolidated financial statements reflect
the application of purchase accounting, described below, relating to the original acquisition of
Celanese AG (“CAG”) and purchase price accounting adjustments relating to the acquisitions of
Vinamul, Acetex and additional CAG shares acquired during the year ended December 31, 2005.
4. D IS CL AI M ER S 4
Predecessor
Represents CAG’s audited consolidated results of operations and cash flows for the year ended
December 31, 2003, its audited interim consolidated results of operations and cash flows for the
three months ended March 31, 2004, and its unaudited interim consolidated results of operations
and cash flows for the three months ended March 31, 2003 and the nine months ended Decem-
ber 31, 2003. These consolidated financial statements relate to periods prior to the acquisition
of CAG and present CAG’s historical basis of accounting without the application of purchase
accounting.
The results of the Successor are not comparable to the results of the Predecessor due to the
difference in the basis of presentation of purchase accounting as compared to historical cost.
Furthermore, the Successor and the Predecessor have different accounting policies with respect
to certain matters.
Combined
Combined results represent a combination of the Predecessor for the three months ended March
31, 2004 and the Successor for the nine months ended December 31, 2004. The combined presen-
tation is not in accordance with U.S. GAAP and is presented for the convenience of the reader.
6. OV ER V I E W A N D VALU E PR O P OSI T I O N 6
Overview and Value Proposition
Equity and cost investments have played an integral role in Celanese’s strategy for growth and
expansion of its global reach. These investments have not only provided the company’s core busi-
nesses with a large presence in Asia and the Middle East, but have also contributed significantly
to earnings and cash flow. Many of these investments are long-standing ventures, one of which
dates back as far as the 1960s. The ventures have sizeable operations and are major players in
their markets.
In 2005, the ventures paid a total of $154 million in cash dividends, adding $150 million in earn-
ings to the company. Total sales for the equity investments in 2005 increased 6% to $3 billion,
of which about $1.3 billion was Celanese’s pro rata share based on ownership percentage. Net
earnings for equity investments increased 14% to a total of $138 million, of which Celanese’s pro
rata share was $61 million. Cash dividends from cost investments totaled $89 million in 2005, an
increase of 141% versus 2004.
Equity and cost investments create value for the company in four unique ways:
≥ They have a history of strong, sustainable financial performance
≥ They are in the growth geographies of the world
≥ They have a proven track record of delivering growth
≥ They create the knowledge and capability to allow for future direct investments.
Strong Operating Performance
Strong operating performance, prudent capital investment programs and strict cash management
and debt policies all contribute to the Celanese equity and cost investments’ formula for value
creation.
The $154 million in cash dividends received by Celanese in 2005 do not include the dividends
of the Acetate business segment’s cost investments in China. During 2005, the dividends paid
by these China ventures were reinvested to double production capacity in China. With the
expansion of tow production already complete, dividend payments will resume in 2006 and are
expected to be between $15 and $20 million for the year. By 2007, after these expansions are
completed, dividend payments are expected to increase at a level of approximately $30 million
per year.
Significant Contribution to Income and Cash Flow
Cash Flow
Income Statement
in US $ million
in US $ million
p Other Distributions - Equity Investments
p Equity Earnings
p Dividends - Cost Investments
p Dividends - Cost Investments
p Dividends - Equity Investments
7. OV ER V I E W A N D VALU E PR O P OSI T I O N 7
Correct Geography
The majority of Celanese’s equity and cost investments are located in Asia – perhaps the region
of the world with the greatest growth position today. With its local partners, Celanese has estab-
lished long-standing relationships in the fastest growing regions of the world. Knowledge of the
market and access to key customers are just two of the advantages a strong, local partner brings
to the ventures – minimizing the risks associated with global expansion.
Investments Expand our Global Presence
Korea Engineering
Plastics
Seoul, Korea
European Oxo JV
Oberhausen,
Germany Polyplastics
Tokyo, Japan (HQ)
Fuji City, Japan
Nantong Cellulose Fibers Co.
Polyplastics JV
Nantong, China
(WinTech Polymer)
Matsuyama, Japan
Fortron Industries
National Methanol Co.
Wilmington, N.C.
Al Jubail, Saudi Arabia
Polyplastics JV
(PTM Eng. Plastics)
Nantong, China
Zhuhai Fibers Co.
Zhuhai, China
Polyplastics JV
(Taiwan)
Kunming Fibers Co.
Kaohsiung, Taiwan
Kunming, China
Polyplastics
Kuantan, Malaysia
Ticona
Chemical Products
Acetate
Track Record of Growth
Collectively, the Celanese equity investments have grown revenues by 6% CAGR net of foreign
exchange. Buoyed by strong local economies and deep customer relationships, the ventures con-
tinue to grow at rates exceeding local GDP. Polyplastics, Celanese’s venture with Daicel, started
out in the 1960s as a Japanese based company and has since expanded its operations throughout
Asia over the years to include Taiwan, Malaysia and now China. Celanese has dedicated resources
in place to provide ongoing technological, operational, and commercial support.
Celanese Equity Investments*
Sales growth 2000-2005 (% change vs. 2000)
*includes European Oxo as of Q4, 2003
8. OV ER V I E W A N D VALU E PR O P OSI T I O N 8
Celanese’s investments can be grouped in two basic categories: Operational and Other.
Our Operational investments include:
Polyplastics
≥
Korea Engineering Plastics
≥
≥ Fortron Industries
≥ China Acetate Ventures
≥ European Oxo
≥ National Methanol.
In the Other category, Celanese has investments in various InfraServ companies in Germany.
Hoechst AG, as part of the Hoechst AG breakup, created several site support service companies
(InfraServs) in the late 1990’s in order to manage the production site services for the various
tenants. As part of the spin-off in 1999, Celanese obtained a share in these companies at its
operational sites.
Major Joint Ventures
Operational Location Ownership Accounting Partner(s) Description
Investments Method
5 Chemical Products
National Methanol Saudi Arabia 25 % Cost SABIC/CTE Methanol production
Company - (Ibn Sina) Petrochemicals
European Oxo GmbH Germany 50 % Equity Degussa AG European propylene based
oxo chemicals business
5 Technical Polymers Ticona
Korea Engineering Korea 50 % Equity Mitsubishi Gas POM
Plastics Co., Ltd. (KEP) Chemical Co., Inc.
Polyplastics Co., Ltd. Japan 45 % Equity Daicel Chemical POM
Industries Ltd.
Kureha Chemical
Fortron Industries U.S. 50 % Equity PPS
Industries
5 Acetate Products
Kunming Cellulose China 30 % Cost China National Acetate tow production
Fibers Co. Ltd. Tobacco Corp.
Nantong Cellulose China 31 % Cost China National Acetate tow and flake
Fibers Co. Ltd. Tobacco Corp. production
Zhuhai Cellulose China 30 % Cost China National Acetate tow production
Fibers Co. Ltd. Tobacco Corp.
Other Investments
InfraServ Hoechst Germany 31 % Equity Clariant, Aventis Site services
GmbH
InfraServ Gendorf Germany 39 % Equity Clariant, Aventis Site services
GmbH
InfraServ Knapsack Germany 28 % Equity Clariant, Aventis Site services
GmbH
InfraServ Wiesbaden GmbH Germany 8% Cost Clariant, Aventis Site services
9. OV ER V I E W A N D VALU E PR O P OSI T I O N 9
Operating EBITDA
Operating EBITDA, a non-GAAP performance measure for Celanese, takes operating profit
and adds equity in net earnings from affiliates, income from cost investments, depreciation and
amortization, and certain adjustments not indicative of underlying business results.
While operating EBITDA includes net earnings from equity affiliates, it does not include the
proportional EBITDA above the equity affiliates’ net earnings. As a result, the true underlying
strength of the equity affiliate franchises is not well represented. As shown on page 21, adding
depreciation and amortization to operating profit shows the equity affiliates’ total contribution.
This “hidden value,” as illustrated below, reflects the true strength of the equity affiliates.
Hidden Value through Equity Affiliates
Earnings and Proportional EBITDA of Equity Affiliates
in $ millions
160
140
120 Not included in
Operating EBITDA Total proportional
100 Proportional EBITDA
EBITDA from
above Earnings
80
Equity Affiliates
(Hidden Value)
60
Included in
40
Operating EBITDA
20
Earnings from Equity Affiliates
0
2003 2004 2005 2006 2007
Proportional EBITDA reflects true value
10. M A J O R E Q U I T Y I N V E S T M EN T S 10
Affiliate Overview
11. A FFI L I AT E OV ER V I E W – M A J O R E Q U I T Y I N V E S T M EN T S 11
Polyplastics Co., Ltd.
C O M PA N Y AT A G L A N C E :
Polyplastics is a joint venture between Daicel Chemical Industries Ltd., Japan (55 %), and Ticona
(45 %). Polyplastics is a leading Asian supplier of engineering polymers with annual consolidated
sales in 2005 of 87 billion Yen. Polyplastics has fully owned production facilities in Fuji City,
Japan and Kuantan, Malaysia. In addition, Polyplastics has JV production facilities in Kaohsiung,
Taiwan (Polyplastics Taiwan), Nantong, China (PTM Engineering Plastics) and in Matsuyama,
Japan (WinTech Polymer). Polyplastics has major affiliates in Japan, Malaysia, Singapore, Hong
Kong, Thailand, China and Taiwan.
The Polyplastics Group has been active for over 40 years in Japan and elsewhere in Asia as a lead-
ing company in the engineering plastics field. Polyplastics is a specialized producer and marketer
of high performance resins and is a leader in product and application development.
Polyplastics’ strategy is to maintain its leadership position in high performance engineering
resins in Asia, and invest to grow with Asian market demand.
F O U N D AT I O N :
Operational since 1964
CELANESE OWNERSHIP:
45 %
CELANESE SEGMENT:
Technical Polymers Ticona
HEADQUARTERS:
Tokyo, Japan
EMPLOYEES:
Approximately 1,500 people
PRODUCTS:
Polyacetal (POM), polyphenylene sulfide (PPS), polybutylene terephthalate (PBT), liquid crystal
polymer (LCP), transparent resin cyclo-olefin copolymer (COC)
P R O D U C T I O N L O C AT I O N ( S ) :
Japan: Fuji, Matsuyama; Malaysia: Kuantan; Taiwan: Kaohsiung; China: Nantong
EXECUTIVE BOARD:
President: Y. Komura
WEBSITE:
www.polyplastics.com
12. A FFI L I AT E OV ER V I E W – M A J O R E Q U I T Y I N V E S T M EN T S 12
Korea Engineering Plastics Co., LTD
C O M PA N Y AT A G L A N C E :
Korea Engineering Plastics (KEP) is a joint venture between Ticona (50 %), Mitsubishi Gas
Chemical (40 %), and Mitsubishi Corporation (10 %). The company was established in 1987.
KEP is the market leader of polyacetal in South Korea and markets polyacetal globally. KEP has
polyacetal production facilities in Ulsan, South Korea, compounding facilities for PBT and nylon
in Pyongtaek, South Korea, and is a joint venture partner in the PTM Engineering Resins plant in
Nantong, China.
KEP’s strategy is to continue high profitability through productivity and value oriented market-
ing activities. This includes maintaining market leadership in South Korea and growing with the
polyacetal market globally.
F O U N D AT I O N :
Operational since 1987
CELANESE OWNERSHIP:
50 % (originally purchased in 1999 by Celanese AG)
CELANESE SEGMENT:
Technical Polymers Ticona
HEADQUARTERS:
Seoul, South Korea
EMPLOYEES:
Approximately 170 people
PRODUCTS:
POM, PBT and Nylon compounding
P R O D U C T I O N L O C AT I O N ( S ) :
Ulsan, Korea; Pyongtaek, Korea
EXECUTIVE BOARD:
President: Choi, Dong-Geon; CFO: Bae, Tae-Youn
WEBSITE:
www.kepital.com
13. A FFI L I AT E OV ER V I E W – M A J O R E Q U I T Y I N V E S T M EN T S 13
Fortron Industries
C O M PA N Y AT A G L A N C E :
Fortron Industries is a general partnership between Ticona Fortron Inc. (50 % ownership and a
wholly-owned subsidiary of CNA Holdings, Inc.) and Kureha KPS, Inc. (50 % ownership and a
wholly-owned subsidiary of Kureha Chemical Industry Co., Ltd). The partnership was organized
in the state of North Carolina for the purpose of manufacturing PPS (polyphenylene sulfide) and
selling PPS and compounded materials with PPS outside of Japan.
This venture combines the sales, marketing, distribution, compounding, and manufacturing
expertise of Celanese with the PPS polymer technology expertise of Kureha.
Fortron Industries’ strategy has three key elements:
≥ Sustainable growth and margin improvement
≥ Secure and favorable raw material positioning
≥ Positioning Fortron Industries as a main player for capacity growth to meet global demand.
Volume, revenue and margin growth have been strong and consistent (with the exception of the
industry-wide downturn in 2000-2002) with sustained strong EBITDA performance. Key raw
materials are under long-term contracts at advantaged rates, leveraging Celanese procurement
wherever possible. Fortron Industries is currently finalizing expansion plans, which will be
required to meet its growth needs for the future 2-5 years.
F O U N D AT I O N :
Operational since 1992
CELANESE OWNERSHIP:
50 %
CELANESE SEGMENT:
Technical Polymers Ticona
HEADQUARTERS:
Wilmington, NC, USA
EMPLOYEES:
Approximately 60 people
PRODUCTS:
PPS
P R O D U C T I O N L O C AT I O N ( S ) :
Wilmington, NC, USA
EXECUTIVE BOARD:
President: Fred Daniell; CFO: Sydney Ingle
14. A FFI L I AT E OV ER V I E W – M A J O R E Q U I T Y I N V E S T M EN T S 14
European Oxo GmbH
C O M PA N Y AT A G L A N C E :
European Oxo is a joint venture combining the assets of the propylene-based oxo chemicals divi-
sions of Celanese AG and Degussa AG (Oxeno). The company, one of the leading manufacturers
of Oxo chemicals in Europe, focuses primarily on European markets, but has activities globally.
The customer base consists of international conglomerates as well as mid-size companies in the
chemicals industry, which produce paints and coatings, adhesives and PVC, as well as flavors and
fragrances.
The company continues to focus on improving profitability with efficiency improvements and
capacity reduction to reflect market demand. The 2005 shutdown of the Marl Butanol unit is one
example.
F O U N D AT I O N :
Operational since October 1, 2003
CELANESE OWNERSHIP:
50 %
CELANESE SEGMENT:
Chemical Products
HEADQUARTERS:
Oberhausen, Germany
EMPLOYEES:
Approximately 230 people
PRODUCTS:
The company manufactures propylene based Oxo products, such as Butyraldehydes, Butanols,
2-Ethylhexanol, DOP, Butyl Acetates and Carboxylic Acids.
P R O D U C T I O N L O C AT I O N ( S ) :
Oberhausen and Marl, Germany
EXECUTIVE BOARD:
Dr. Martina Flöel, Dr. Rainer Fretzen
15. A FFI L I AT E OV ER V I E W – M A J O R E Q U I T Y I N V E S T M EN T S 15
InfraServs
C O M PA N Y AT A G L A N C E :
Celanese holds ownership interest in several InfraServ Groups located in Germany: InfraServ
Hoechst (31 %), InfraServ Gendorf (39 %), InfraServ Knapsack (28 %) and InfraServ Wiesbaden
(8 %, cost investment). The InfraServs own and develop industrial parks and provide on-site
general and administrative support to tenants.
F O U N D AT I O N :
1999
CELANESE OWNERSHIP:
Varied – see above
CELANESE SEGMENT:
Other Activities
HEADQUARTERS:
Hoechst, Gendorf, Knapsack, Germany
EMPLOYEES:
Approximately 6,000 people
PRODUCTS:
Site services
EXECUTIVE BOARD:
Juergen Vormann, Managing Director
Roland Mohr, Managing Director
WEBSITES:
Hoechst: www.infraserv.com
Gendorf: www.infraserv.gendorf.de
Knapsack: www.infraserv-knapsack.de
16. A FFI L I AT E OV ER V I E W – M A J O R COS T I N V E S T M EN T S 16
National Methanol Co. (Ibn Sina)
C O M PA N Y AT A G L A N C E :
With production facilities in Saudi Arabia, National Methanol Co. represents 2 % of the world’s
methanol production capacity and is the world’s eighth largest methanol producer of methyl
tertiary-butyl ether (MTBE). Methanol and MTBE are key global commodity chemical products.
Celanese owns a 25 % interest in National Methanol Co. The Saudi Basic Industries Corporation
(SABIC) holds 50 % and CTE (owned 50 % by Duke Energy International and 50 % by Celanese)
owns the remainder. SABIC has responsibility for all product marketing.
F O U N D AT I O N :
Operational since early 1980’s
CELANESE OWNERSHIP:
25 %
CELANESE SEGMENT:
Chemical Products
HEADQUARTERS:
Al Jubail, Saudi Arabia
EMPLOYEES:
Approximately 300 people
PRODUCTS:
MeOH, MTBE
P R O D U C T I O N L O C AT I O N :
Al Jubail, Saudi Arabia
EXECUTIVE BOARD:
President: Abdulrahman Al-Garawi
17. A FFI L I AT E OV ER V I E W – M A J O R COS T I N V E S T M EN T S 17
Celanese Acetate China Ventures
C O M PA N I E S AT A G L A N C E :
Celanese holds an approximate 30 % ownership interest (50 % board representation) in three
separate acetate production ventures in China. In each instance, Chinese state-owned entities
control the remainder. The terms of each of these joint ventures expire in January 2020.
With an estimated 30 % share of the world’s cigarette production and consumption, China is the
world’s largest and fastest growing market for acetate tow products. In combination, these ven-
tures represent the market leader in Chinese domestic acetate production and are well positioned
in the Chinese cigarette market.
In March 2003, Celanese and its partners agreed to expand the manufacturing facilities at all
three joint ventures in China. We expect that these expansions will be completed during 2007.
The ventures expect to fund the required investments from operating cash flows.
F O U N D AT I O N :
Operational since 1989 (Nantong Cellulose Fibers Company, Ltd.) and 1994 (Kunming Cellulose
Fibers Company, Ltd. and Zhuhai Cellulose Fibers Company, Ltd.)
CELANESE OWNERSHIP:
Approximately 30 %
CELANESE SEGMENT:
Acetate Products
EMPLOYEES:
Approximately 1,500 people
PRODUCTS:
Flake (Nantong Cellulose Fibers Company, Ltd.), Tow (All)
P R O D U C T I O N L O C AT I O N S :
Nantong, Kunming and Zhuhai, China
EXECUTIVE BOARD:
Chairman, President: Bian Youlon
18. M A J O R E Q U I T Y I N V E S T M EN T S 18
Key Financial Data
19. K E Y FI NAN CIAL DATA 19
Key Financial Data
During 2005, Celanese received $66 million in dividends and other distributions from equity
investments. Our total investment in equity affiliates decreased from $600 million to $555 million
at the end of 2005. Celanese equity in net earnings of affiliates amounted to $61 million in 2005, up
from $48 million in 2004. Polyplastics, Fortron and KEP mostly contributed to the strong perfor-
mance, as these Ticona segment ventures continue to experience solid growth, especially in Asia.
Affiliates Investment Summary
Dividends and other
Ownership Percentage Carrying Value Share of Earnings (Loss) Distributions
in US $ million, except for percentages
Successor Successor Successor Predecessor Celanese’s Share
Nine Months
As of As of As of As of Year Ended Ended Three Months Year Ended
Segment 12/31/2005 12/31/2004 12/31/2005 12/31/2004 12/31/2005 12/31/2004 03/31/2004 12/31/2003 2005 2004
European Oxo GmbH Chemical 50.0% 50.0% 13 3 10 (5) (3) (2) — —
Products
Fortron Industries Ticona 50.0% 50.0% 57 58 11 6 2 4 13 4
Korea Engineering Ticona 50.0% 50.0% 146 155 14 11 3 8 18 5
Plastics Co., Ltd
Polyplastics Co., Ltd Ticona 45.0% 45.0% 179 202 24 17 7 15 23 14
InfraServ GmbH & Co. Other 39.0% 39.0% 23 25 4 3 1 1 3 1
Gendorf KG
InfraServ GmbH & Co. Other 31.2% 31.2% 115 134 7 5 2 9 9 10
Höchst KG
InfraServ GmbH & Co. Other 28.2% 27.0% 17 20 1 1 — 1 2 1
Knapsack KG
Other Various Various Various 5 3 (10) (2) — (1) (2) 3
Total 555 600 61 36 12 35 66 38
20. K E Y FI NAN CIAL DATA 20
Cost investments in 2005 generated $89 million for Celanese, mostly due to National Methanol
Company. Dividends from the Acetate China Ventures remained low as available earnings are
reinvested to finance the expansion currently underway. After completion of the expansions in
2007, dividends from the China Ventures are expected to once again be a significant part of the
total dividends from cost investments for Celanese.
Cost Investment Summary
in US $ million,
Ownership Percentage Carrying Value Dividends
except for percentages
Successor Successor Successor
3 Months 9 Months
As of As of As of As of Ended Ended
12/31/2005 12/31/2004 12/31/2005 12/31/2004 2005 03/31/2004 12/31/2004
National Methanol 25.0% 25.0% 54 54 80 3 24
Company - (Ibn Sina)
Kunming Cellulose 30.0% 30.0% 15 15 1 – –
Fibers Co. Ltd
Nantong Cellulose 31.0% 31.0% 77 77 – – 3
Fibers Co. Ltd
Zhuhai Cellulose Fibers 30.0% 30.0% 15 15 1 – 1
Co. Ltd
InfraServ GmbH & Co. 8.0% 18.0% 13 22 2 3 4
Wiesbaden KG
Other – – 46 50 5 – 1
Total – – 220 233 89 6 33
Equity investments have significantly contributed to Celanese over the years. The cash position in
the investments collectively exceeds the total debt level. In 2005, Celanese’s share of operating profi t
was $98 million and its share of depreciation and amortization was $61 million.
21. K E Y FI NAN CIAL DATA 21
Summary – Equity Investments
in US $ million (unaudited) 2003
2005 2004
Celanese’s Celanese’s Celanese’s
Total Results Share Total Results Share Total Results Share
Net Sales 3,028 1,252 2,849 1,163 2,134 824
Depreciation and Amortization 154 61 134 52 131 51
Operating Profit (Loss) 228 98 183 78 141 58
Net Earnings 138 61 121 48 85 35
Dividends Received 62 37 23
Other Distributions 4 1 -
Cash and Cash Equivalents 204 87 258 118 189 86
Long and Short Term Debt 221 94 212 95 183 83
Net Debt (17) (7) 46 23 5 4
Capital Expenditures 125 48 189 74 139 50
Summary – Total Dividends and Other Distributions
Cost Investments 89 39 53
Equity Investments 65 38 23
Total 154 77 76
The fiscal year end for all ventures is December 31. All line items as presented in the table above
represent the amounts recorded by the ventures based on local generally accepted accounting
principles and, with respective to Celanese’s share, are computed in proportion to our ownership.
These amounts are not included in the items reported by the Successor and the Predecessor with
the exception of net earnings, which is reported as reflected on page 19 of this document.
23. ACCO U N T I N G F O R E Q U I T Y A N D COS T I N V E S T M EN T S 23
Accounting for Equity and Cost Investments
Equity Investments
Equity accounting is required when the investor typically has 20-50 % ownership with the ability
to exercise significant influence over the operating and financial policies of the investee, but does
not exercise control.
Celanese equity investments are classified as and included in “Investments” in the consolidated
balance sheet. Celanese share of earnings (losses) in the equity investments are classified as
“Equity in Net Earnings of Affiliates” in the consolidated statement of operations.
Dividends received from equity investments have no effect in the consolidated statement of
operations; rather they reduce the carrying value of the investment. The Celanese consolidated
statements of cash flows include the cash flow effect of the dividends. Since the consolidated
cash flow is based on Celanese net earnings, the equity in net earnings of affiliates (which are
non-cash) must be eliminated and dividends included. The net impact of the elimination of the
equity in net earnings of affiliates and addition of dividends is included as “Change in equity of
affiliates” in the consolidated statement of cash flows.
Cost Investments
Accounting for investments under the cost method is required when the investor has typically
less than 20 % ownership and cannot exercise significant influence over operating and financial
policies of the investee. Celanese has ownership greater then 20 % in four affiliates which are
accounted for as cost investments because Celanese does not have the ability to exercise signifi-
cant influence over their operating and/or financial policies due to reasons such as inability to be
involved in day to day operations, country risk, etc. These investments are:
Saudi Methanol Co. (Ibn Sina) – 25 % ownership
≥
China Acetate Ventures (3) – approximately 30 % ownership
≥
Celanese cost investments are classified and included in “Investments” on the consolidated
balance sheet. Earnings of cost investments have no effect on Celanese consolidated statement of
operations. Dividends received from the cost investments are recorded in the Celanese consoli-
dated statement of operations as “Other Income, net”. The Celanese consolidated statements of
cash flows include the cost investments dividends in “Net earnings (loss)”.
24. ACCO U N T I N G F O R E Q U I T Y A N D COS T I N V E S T M EN T S 24
Celanese Corporation and Subsidiaries Consolidated Statements of Operations
Successor Predecessor
in US $ million
Year Ended 9 Months Ended 3 Months Ended Year Ended
12/31/2005 12/31/2004 03/31/2004 12/31/2003
Net sales 6,070 3,744 1,218 4,485
Cost of sales (4,773) (3,026) (983) (3,795)
Gross margin 1,297 718 235 690
Selling, general and administrative (562) (497) (136) (504)
expenses
Research and development expenses (91) (67) (23) (89)
Special (charges) gains:
Insurance recoveries associated with 34 1 - 107
plumbing cases
Sorbates antitrust matters - - - (95)
Restructuring, impairment and (107) (83) (28) (17)
other special (charges) gains
Foreign exchange gain (loss), net - (3) - (4)
Gain (loss) on disposition of assets, net (10) 3 (1) 6
Celanese’s Operating profit 561 72 47 94
share of earnings
Equity in net earnings of affiliates 61 36 12 35
(loss) of equity
investments
Interest expense (387) (300) (6) (49)
Dividends from Interest income 38 24 5 44
costs investments
Other income (expense), net 89 (12) 9 48
are recorded in
this line item
Earnings (loss) from continuing operations 362 (180) 67 172
before tax and minority interests
Income tax provision (57) (70) (15) (45)
Earnings (loss) from continuing operations 305 (250) 52 127
before minority interests
Minority interests (37) (8) - -
Earnings (loss) from continuing operations 268 (258) 52 127
Earnings (loss) from discontinued operations:
Earnings (loss) from operation of discontinued 9 5 - 23
operations
Gain (loss) on disposal of discontinued - (1) 14 7
operations
Income tax benefit - 1 12 (8)
Earnings (loss) from discontinued 9 5 26 22
operations
Cumulative effect of changes in accounting - - - (1)
principles, net of income tax of $1 million in 2003
Net earnings (loss) 277 (253) 78 148
25. ACCO U N T I N G F O R E Q U I T Y A N D COS T I N V E S T M EN T S 25
Excerpt from Celanese Corporation and Subsidiaries Consolidated Balance Sheet
Successor
in US $ million
As of 12/31/2005 As of 12/31/2004
Assets
Current assets:
Cash and cash equivalents 390 838
Receivables:
Trade receivables, net 918 843
Other receivables 480 670
Inventories 661 604
Deferred income taxes 37 71
Other assets 91 86
Assets of discontinued operations 2 39
Total current assets 2,579 3,151
Equity and
Cost Investments Investments 775 833
included here
Property, plant and equipment, net 2,040 1,702
Deferred income taxes 139 54
Other assets 482 523
Goodwill 949 747
Intangible assets, net 481 400
Total assets 7,445 7,410
Liabilities and Shareholders’ Equity (Deficit)
Current liabilities
Short-term borrowings and current installments of 155 144
long-term debt – third party and affiliates
Trade payables – third party and affiliates 810 716
Other current liabilities 784 888
Deferred income taxes 36 20
Income taxes payable 225 214
Liabilities of discontinued operations 3 13
Total current liabilities 2,013 1,995
Long-term debt 3,282 3,243
Deferred income taxes 285 256
Benefit obligations 1,126 1,000
Other liabilities 440 510
Minority interests 64 518
Commitments and contingencies
Shareholders’ equity (deficit):
Preferred stock, $0.01 par value, 100,000,000 shares authorized and 9,600,000 - -
issued and outstanding as of December 31, 2005
Series A common stock, $0.0001 par value, 400,000,000 shares authorized and - -
158,562,161 and 0 shares issued and outstanding as of December 31, 2005 and
2004, respectively
Series B common stock, $0.0001 par value, 100,000,000 shares authorized and - -
0 and 99,377,884 shares issued and outstanding as of December 31, 2005 and
2004, respectively
Additional paid-in capital 337 158
26. ACCO U N T I N G F O R E Q U I T Y A N D COS T I N V E S T M EN T S 26
Excerpt from Celanese Corporation and Subsidiaries Consolidated Statements of Cash Flows
Successor Predecessor
in US $ million
Year Ended 9 Months Ended 3 Months Ended Year Ended
12/31/2005 12/31/2004 03/31/2004 12/31/2003
Operating activities
Includes cost divi-
dends and equity
Net earnings (loss) 277 (253) 78 148
in net earnings of
affiliates Cumulative effect of changes in accounting principles - - - 1
Adjustments to reconcile net earnings (loss) to net cash
provided by (used in) operating activities:
Special (charges) gains, net of amounts used 30 47 20 91
Stock based compensation - - 2 65
Depreciation 218 140 67 271
Amortization of intangible and other assets 68 41 3 18
Primarily reflects Amortization of deferred financing fees 41 98 - -
cash dividends less
Change in equity of affiliates 5 (14) 4 (12)
equity in net earn-
ings of affiliates
Deferred income taxes (85) 19 (14) 71
(Gain) loss on disposition of assets, net 7 (3) - (9)
Write-downs of investments - - - 4
(Gain) loss on foreign currency transactions 70 19 (26) 155
Minority interests 37 8 - -
Loss on extinguishment of debt 74 21 - -
Guaranteed annual payment 22 8 - -
Operating cash provided by (used in) discontinued
(10) 4 (147) (5)
operations
Changes in operating assets and liabilities:
Trade receivables, net – third party and affiliates 30 (23) (89) (9)
Other receivables 33 109 (42) 22
Prepaid expenses (65) (8) 14 (50)
Inventories 21 (25) (11) (7)
Trade payables – third party and affiliates 18 96 (6) (36)
Benefit obligations and other liabilities (141) (364) 7 (153)
Income taxes payable 17 10 38 (195)
Other, net 47 7 (5) 31
Net cash provided by (used in) operating activities 714 (63) (107) 401
Investing activities from continuing operations:
Capital expenditures on property, plant and equipment (212) (211)
Acquisition of CAG, net of cash acquired (473) (1,564) - -
Fees associated with acquisitions (29) (69) - -
Acquisition of Vinamul, net of cash reimbursed (198) - - -
Acquisition of Acetex, net of cash acquired (216) - - -
Acquisition of other businesses - - - (18)
Net proceeds on sale of businesses and assets 48 31 - 10
Net proceeds from disposal of discontinued operations 75 - 139 10
Proceeds from sale of marketable securities 217 132 42 202
Purchases of marketable securities (137) (173) (42) (265)
Other, net 5 (1) 1 (3)
Net cash provided by (used in) investing activities (920) (1,810) 96 (275)
