DALLAS - Celanese Corporation (NYSE: NYSE:CE), a global chemical and specialty materials company, reported a fourth-quarter earnings miss, prompting a 3% decline in its stock price. The company's adjusted earnings per share (EPS) for the quarter was $2.24, falling short of analysts' expectations by $0.07. Revenue also slightly missed the mark, coming in at $2.57 billion against the consensus estimate of $2.59 billion.
The company's performance in the fourth quarter reflects the challenges faced in 2023, with a backdrop of competitive market dynamics and operational disruptions. Despite these hurdles, Celanese was able to generate record operating cash flow of $830 million and record free cash flow of $702 million for the quarter, both quarterly records.
Celanese's CEO, Lori Ryerkerk, commented on the company's resilience amid tough conditions, stating, "In a challenging backdrop across the entirety of 2023, our team decisively executed on hundreds of actions to reduce our costs, secure alternative volumes, align our production and inventory levels with demand, and maximize our cash generation." She emphasized the company's focus on controlling what it can in order to deliver strong cash generation, exceed net debt reduction objectives, and enhance business competitiveness entering 2024.
The company's full-year 2023 GAAP diluted earnings per share stood at $18.00, with adjusted earnings per share at $8.92. The net sales for the year increased by 13 percent compared to the previous year, reaching $10.9 billion. This was primarily due to a 23 percent increase in volume from the Mobility & Materials (M&M) acquisition, despite a 10 percent decrease in price and a 2 percent volume decrease excluding M&M.
Looking ahead, Celanese anticipates first-quarter adjusted earnings per share to be between $1.75 and $2.00, inclusive of approximately $0.30 per share of M&M transaction amortization. This guidance reflects the sequential volume and pricing conditions that are not expected to materially improve at the start of 2024.
The company's stock movement and the earnings miss are indicative of investor reaction to the financial results and the challenges faced by Celanese in the current market environment.
InvestingPro Insights
As Celanese Corporation navigates through a competitive landscape, the company's financial health and stock performance remain a key focus for investors. According to InvestingPro data, Celanese boasts a market capitalization of $16.26 billion and trades at a P/E ratio of 8.07, which is compelling when paired with its near-term earnings growth. The company's commitment to shareholder returns is evident with a consistent history of dividend growth, having raised its dividend for 14 consecutive years and maintained dividend payments for 20 consecutive years.
InvestingPro Tips highlight that Celanese is trading at a low P/E ratio relative to its near-term earnings growth, which may interest value-focused investors. Additionally, the stock has shown low price volatility, suggesting a level of stability in its share price movements. For those looking for more in-depth analysis, InvestingPro offers further tips on Celanese, which can be accessed with the promo code PRONEWS24 for an additional 10% off a yearly or biyearly Pro and Pro+ subscription. Currently, there are 9 additional InvestingPro Tips available for Celanese, providing a broader perspective on the company's performance and potential investment opportunities.
With a strong revenue growth of 11.66% over the last twelve months as of Q3 2023 and a significant price uptick of 29.72% over the past six months, Celanese's financials reflect a robust business model. The company's ability to generate a high return over the last decade, as noted in one of the InvestingPro Tips, complements the recent revenue and share price increases, painting a picture of a company that has been able to deliver value over an extended period.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.