Celanese Corporation (NYSE: CE) stock rose over 3.5% on July 20th, 2018 (as of 9:50 AM GMT-4; Source: Google finance) after the company reported better than expected results for the second quarter 2018. CE has ended the quarter with cash and cash equivalents of $708 million, which is up about 39% year over year. Long-term debt was up 10% year over year to $3,228 million. The company has generated operating cash flow of $585 million and free cash flow of $500 million in the third quarter.
CE in the second quarter of FY 18 has reported the adjusted earnings per share of $2.90, beating the analysts’ estimates for the adjusted earnings per share of $2.40 as per Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 22 percent to $1844 million in the second quarter of FY 18, beating the analysts’ estimates for revenue of $1789 million.
CE has declared a quarterly dividend of $0.54 per share on its Series A common stock, payable on August 6, 2018. The dividend is payable to stockholders of record as of July 27, 2018. The company has returned $173 million to shareholders through dividends and share repurchases in the second quarter.
CE has raised its adjusted earnings per share guidance for 2018, expects to be in the range of $10.50-$10.75 after factoring in strength across its EM and Acetyl Chain units. The company expects the momentum in Acetyl Chain to continue into the third quarter. The project pipeline model also continues to advance in EM. Celanese also envisions Acetate Tow earnings to remain relatively flat year over year in 2018. Moreover, the company expects to deliver free cash flow of more than $1 billion in 2018.
Meanwhile, CE has signed a Letter of Intent (LOI) with Chengzhi Shareholding Co., Ltd., to further the development of acetic acid-based ethanol as a clean energy source in China. As per LOI, CE would sell its Nanjing ethanol unit to Chengzhi, along with all related assets, including equipment, storage tanks and pipelines as well as all necessary land rights and permits. Additionally, Celanese would contribute its TCX technology, along with all associated patents, know-how and trade secrets, into a newly formed joint venture. Through this joint venture the two companies would collaborate to further strengthen the TCX technology and promote additional opportunities for utilizing the TCX ethanol process technology within the People’s Republic of China.