Celanese CorporationCE has decided to expand the capacity of acetic acid and vinyl acetate monomer ("VAM") and also announced debottleneck projects at its global manufacturing facilities.
The Clear Lake, TX acetyls manufacturing facility is on schedule to increase VAM capacity by 150kT annually by the fourth quarter of 2018. Post this, total VAM capacity at the facility will be 450kT per annum, making it the largest and most efficient VAM plant globally.
Celanese will also implement and translate a number of capital efficient technology-oriented process improvement projects across a global network of acetyls manufacturing plants. This will add 140kT per annum of acetic acid and 150kT per annum of VAM, to meet the increasing demand, through the year 2020. These debottlenecking projects will leverage a new generation of Celanese's AOPlus acetic acid and VAntagePlus VAM manufacturing technologies.
Celanese has outperformed the industry in a year's time. While shares of the company have moved up around 25.8%, the industry gained roughly 9.5%.
Celanese logged earnings from continuing operations of $2.68 per share for the first quarter, a roughly two-fold increase from $1.30 per share a year ago. Adjusted earnings of $2.79 per share surged 54% from $1.81 per share posted a year ago, topping the Zacks Consensus Estimate of $2.36.
Revenues jumped roughly 26% year over year to $1,851 million, also surpassing the Zacks Consensus Estimate of $1,696 million. The company benefited from gains across its Engineered Materials (EM) and Acetyl Chain units in the quarter. Improving industry fundamentals and the strength of the company's commercial models also supported the results.
Celanese raised earnings guidance for 2018 based on strength across its Acetyl Chain and EM units. The company now envisions adjusted earnings per share to grow in the range of 20-25% year over year in 2018, up from its earlier view of 12-16% growth.
Celanese Corporation Price and Consensus
Zacks Rank and Other Stocks to Consider
Celanese currently sports a Zacks Rank #1 (Strong Buy).
Other top-ranked companies in the basic materials space worth considering are FMC Corporation FMC , Huntsman Corporation HUN and Kronos Worldwide Inc. KRO . All three stocks flaunt a Zacks Rank #1. You can see the complete list of today's Zacks #1 Rank stocks here .
FMC Corporation has an expected long-term earnings growth rate of 11.26%. Its shares have gained around 20% over a year.
Huntsman has an expected long-term earnings growth rate of 8.25%. Its shares have moved up around 19.8% over a year.
Kronos has an expected long-term earnings growth rate of 5%. Its shares have gained around 41.8% over a year.
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