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CE Celanese Corp - Series A

Participants
Chuck Kyrish Vice President, Treasurer and Investor Relations
Mark Rohr Chairman and Chief Executive Officer
Todd Elliot Senior Vice President-Acetyl Chain
Scott Richardson Chief Financial Officer
Vincent Andrews Morgan Stanley
David Begleiter Deutsche Bank
Mike Sison KeyBanc
Robert Koort Goldman Sachs
Ghansham Panjabi Robert W. Baird
Duffy Fischer Barclays
John McNulty BMO Capital Markets
P.J. Juvekar Citi
John Roberts UBS
Kevin McCarthy Vertical Research Partners
Call transcript
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Operator

Good morning, and welcome to the Celanese Fourth Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Chuck Kyrish, Vice President, Treasurer and Investor Relations. ahead. go Please

Chuck Kyrish

Richardson, to conference Welcome today future Acetyl these the statements. risk our reports Corporation quarter Officer; fourth Mark Actual Vice Please Elliot, and Thanks, expectations This the President, is forward-looking earnings Scott factors about Executive differ Chief call. for Chairman me Financial Chuck XXXX Officer; Rohr, Todd forward-looking Today’s Jerry. see and Celanese Chief Chain. Senior results Kyrish. are statements. relating includes might presentation statements for results. from any materially SEC With

discussion to Our today financial will references also non-GAAP include measures.

find measures non-GAAP measures on can Relations and GAAP in related website comparable Investor the their You to our section. information reconciliation these to

SEC’s XXXX Form its we’ll and our Corporation in X-K to after Investor reports release all earnings prepared these yesterday, quarter the containing and directly section our published the system. Relations fourth remarks EDGAR distributed questions. of posted quarter materials your comments go Business on via market we of Wire Celanese the close. slides Since yesterday about available website are

Operator

the begin Stanley. question-and-answer Please ahead. [Operator first question Instructions] now comes with from go will We Morgan Our Vincent Andrews session.

Vincent Andrews

us And everyone. range the you purposes. framework of unpack of a you the outcomes in modeling oil interplay for is obviously the and Wondering dynamics are could good help prepared the of that? bookend year sort us after maybe could what a and XXXX? for with of quarter was fourth us and you, that ethylene. lot of of Thank that would would What the just Acetyl But help all and your lot with think you There morning, remarks about a just and conversation methanol in Chain if a volatility phenomenal in year. this

Mark Rohr

Right. huge me Well, that’s – question. let a

that is some Todd off, I’ll to this ask So make and kick Mark here. comments

kind the beginning. start from of me Let

really so regarding today in itself rippled sense. oil really last And economic through had conundrum in ethylene sort and of lot collapse year. back environment China the of occurred in I world And effects relates this think and the on collapse to that of that that methanol. a in finds the in the petrochemical prices ripple MTO kind huge industry prices a China, raw impacts many of broad ultimately in course, materials, oil

that So kind that. dynamics of into you all had rolled these

that start into the on some quarter that next are Todd, The again and ask we China the ways, region in in But of many And second. China. saw, little that in some contained I the give end of this to of And think its And So get settling, that quarter the that’s, normalizing back start weakness we that, The course, but saw of really in level. wouldn’t we we months couple now chain of kind as the we’re going we and at to seems see think in process forward. this is world. a in and slowdown fourth quarter fourth more it was saw the say that that. a as settling of to recover with going we saw we the China we ended the is run – we dynamics and pricing business, quarter. be around it bit impact to in the color really saw I’ll was it you of broad

of billion. business power this bit down the to is in about we a feel we we this I’ll with range forecast. So and earnings – $X more have feel around step But little our talk this about business this earning talk going to and We this very that we we good see and about think when the year. business of fundamentals earnings, this ongoing

throughout. saw more provide to what you want you do Todd, perhaps just So clarity on

Todd Elliot

end the just is capacity at we that those diversity about is the so picture, you when believe, play. of in XX% Well, whole per across look global That rates acetyl the see macro utilization, capacity are the on growing in uses utilization still that, fundamentals, around X% the macro net year. with range up across that about system. still note we Stack the

Mark end what was So in on rate this particularly the describing year, utilization demand, is instantaneous of mainly slower China. change

we And itself the through part the first get kind that the sorts of back march that quarter, into – New as will So price course particularly up of allow some rates Chinese into those bump will up XXXX, over the recovery instantaneous XX% through Year, you range. we think of that after utilization as into year.

Vincent Andrews

the EBITDA which might a out the that ramp to was the out savings the take effectively other in of going math to from there? And also the of your right market, it? up follow-up, to opportunity get all U.S., of earnings and the the offsets assets. than is new think Asia sort And just help you whatever you power capacity that the the take some capacity doing way of capacity as optimization get then Is that decision the as more obviously, to you’re about

Mark Rohr

Yes.

company whether I level, make convey in we’re of and back only. the take to here only for it’s honest, that shareholders kind people this at on are trying a productivity investments this and the return can in to But we’re big get part – high – sort these of of can what very world – ongoing debate our we giving we’re the think sense business. about to be modest value

foundation. needed the going to $XXX So you or have million demand to have to don’t yet the a to that our another view is add for us market’s grow

through be we is based that’s business kinds plus it million think that that you in that are for these the $XXX moves. what be foundation it So investments, And VAM of on what the see. or

that of more to EBITDA we that return of a within feel the capacity picture think, at period in will balance with what demand is return-friendly us a have – plenty this and to, So for the tackle we way keep fashion. we time be as upside

Todd Elliot

of absolutely. It’s in earnings of about looking value another foundational Yes, that the acetyl. series always steps level adds creation for to

wave this that we the methanol, on, to that have so clears. to Clear sources other to monoxide backwards Also production. Ultimately, Lake, bring acquisition So significant be we CO when next embarking soon in advantaged is integration have we’re carbon of there.

downstream we Lake, the there just First, on tons. that XXX,XXX have by Clear VAM usage unit expanded

more So in think benefit, flexibility Asian particularly very a of rate today good than have range we huge integration side. the operating so

us. So to largely Mark’s a it’s we this. measure when point, that productivity on look out helps And

addition nice a value of steps. So it’s combination

Vincent Andrews

Chuck. you. to welcome Thank back And

Chuck Kyrish

Thanks.

Operator

Bank. comes The next with Please question ahead. from David go Deutsche Begleiter

David Begleiter

on forward color more you provide business a operating the that can the XXXX, little expectations for profit so X% was morning. in Good just Why Engineered light? Mark, in you. XXXX. maybe looking to quarter? Materials, it And on Thank growth

Mark Rohr

I’ll Yes, with start the one. last

has of We as earnings contribution XX% expect that kind kind business year-over-year. to it grown of grow –

that plug model. into you So your

that If you there in see quarter, return what for a pushing look destocking And naturally many a was at XXXX. of face We the that our for pricing that. polymers business occurring we were tee we felt the lot this that as slowdown listed was up the out for did I reasons we we’re in to the better of fourth entered as well. doing

through as cost worked our that things it inventory, that saw be offset some the extraordinary here really rolled we pricing our in with From what negative lot way. saw and we – world in a we by the is quarter system. we costs really to for uptick had good both So logistics that down like costs impacted of inventory and a volume extraordinary

a really cost-driven it’s any of more base So the falloff kind reduction in business. versus

David Begleiter

sorry. Got on it. And – just

Scott Richardson

Scott is add I This David. Richardson. want to there. sorry, No, just

remember with we’ve I think important were that project it’s in the year we also wins the on said. right to track what had

finished the year. during projects we north X,XXX of So

around raws and continues XXXX, of which lead So very successful doing very moved from about perspective controllable XX%. those in the for And And to to a can benefits be should that business that talked price stated. we driving about, up during XXXX moving that in Mark to yield factors importance margin track growth we’re clear that. the on the we’re as

David Begleiter

reaffirmed provide just a bridge, share, that’s lackluster pretty now macro versus a a target, And target, backdrop? XXXX robust now of $XX bit XXXX little good. Mark, about implies the a growth Very in given given XXXX. probably you you XX% EPS which a Can

Mark Rohr

Yes.

kind moving into what pretty billion, back $X and $XXX business. million is – we’ll for range AC there. end to plus that us $X there’s think the where fundamental year, In probably me a this we ending – just in if Let sense, this We $XXX for starting we versus it much cards million billion, I is think sense, to real $XXX another the expect at of we’re of that’s million upside. the be in look year next as simple so or

– tow, $XXX from We I got mean, million And we’ve a process, acetate go expect on. last in M&A our is $XX – of productivity. in as into our from is of were we we set essentially basic as we’ll AC, incrementally million that leasing basic $XX course, XXXX – In move leaves time our to balance in EM strategy. going strategy the the that which That that’s eyes we’re other million to have, establish another to add XXXX. we

David Begleiter

very Scott. Great. Thank you much, and Mark

Mark Rohr

you. Thank

Operator

ahead. comes question next Mike go Please KeyBanc. with The Sison from

Mike Sison

those sure year? it’s that Can just want when walk it’s the of you got Acetyl understand. what the term, about through demand-related think now. sure And I under through get I how head Hey more Just maybe feel as guys. than above I think quarter? fourth rates utilization could the the And to supply-related. want make went second the Mark, XX% us into you near half we that make Chain to I then XX%

Mark Rohr

it’s Well, give in in a broad China supply-related numbers I’ll a all. sense, here. was But slowdown just Todd slowdown. The specific at ask to not

industry saw as stuff activity saw result, Clean the on beyond across of End utilization Sky and actually you drop. initiatives in actually would have. well there much we nearly terms we industrial wasn’t so as in AC because And China board going rates normally production less

sense we happened. low And I So that into the in is what dropped very the think fundamental XXs.

not, whether the stayed or XX% – but X capacity think, on was it on whether utilization short-term on X Now know, to touched certainly I don’t basis. we turns, a we

settled The degree in. of back settled in. do see Todd, of it And Chinese seems right a we’re problems to ends to this up. We want run largely And to numbers. a we That course. that to and have maybe confidence fair seems some time. have these of get New happened its specific cleared other has believe you going period short have up, march very also as some But business that’s in that, Year give

Todd Elliot

is of VAM capacity those million about tons of capacity. of numbers XX% if these big about tons million utilization. to numbers are that demand, million been have X macro we think you to talked that’s XX at additions demand, are the And base. I And XX before. still see tons We global of X tons XX%. There million think that’s supply, supply no little play. about in that

of Mark oil reasons, this various for So the as end really, in prices falling, trade, falling, year, described, of XXXX sentiment, is fill demand slowdown the blank. prices first an part ethanol

that what again. really It’s Now here. Europe, emulsion, is And start can the look acetic are acid China. into good start beyond acetate pretty actually year. we Americas this buying we customers particularly reverse the itself elsewhere at when our of in world, and also or in If quickly vinyl we’re the order just when the books describing in then at acute books extend order in discussion

of that a XXs it speaks that or into of something that mid-XX% once year. So again start we really the the expect back this which the the term. instantaneous can number, But once quickly pick under to dry kicks out balance, for here come a end And at in in, really inventories is a start year, China out, probably that, the demand near back dip to short weeks high will. few range,

Mike Sison

acquisition EM go still of to And growth EM, you the this then forward? Great. build could is roll. projects do year? you new And pretty the think that as pipeline robust And shifting on organic to type then generate gears continue for what to

Scott Richardson

to expect we Mike, up XXXX. to mid into work type way volume growth Yes. as high get back the we single-digit our into

be will on softer think, we But expect grow. we bit to be to QX, that. little do able Now a

itself into single-digit QX. this level the in out, year, be our low But work as may growth will we way as of we think year-over-year that work So in recover. we the balance see we destocking the

example, year in to be as industry the out growth very for our us. favorable whereas We the pipeline And the see – that, automotive being we continue saw we that for the of even X%, end very was towards play around declined.

we are positive our numbers controllable us get work to And things with so going into think back going to customers XXXX. projects we And volume to is there. what be that’s growth good, the the continue really and in

Mike Sison

Thank Great. you.

Mark Rohr

Thank you.

Operator

The Please go from Koort comes with Goldman next ahead. question Robert Sachs.

Robert Koort

Thanks. you talk with did the you how syngas or Good But spend I I that guess, capital want back don’t of uses better Lake? on strategy morning. integrated? have Mark, about that. the to see capital, plant future in you had can if I Clear merits get just to much to… you Is to of spend your a

Mark Rohr

in owned question, long. going it exact But had new It’s a at that’s an terms probably it’s you ago. cost not – will of to embedded actually I’m that. we course, a asset give The the fraction look before it’s answer years you unit, too number. to a unit. reference When our of opportunity to public But asset. kind of that a the legacy new Celanese of And to your in acquire be of

very So as economics presents at acetic expanding it there. favorable acid for we production look us

So how it into plugs it. that’s

Robert Koort

that So supplying wasn’t you unit currently?

Mark Rohr

– building new is a Linde unit. But Air Products was. It now

So lost – old us. that with their had contract lost had Linde

Robert Koort

obviously guys aggressive more market. the got in you And

$XXX about of into that the optimism should presume, stock quarter. we at second first talked part the your XXXX, as opportunistic, being buying half here of about You buying of stock year XXXX the quite in fourth given bit a well? in be Should you

Mark Rohr

Yes.

and you what’s buy. to to $XXX have what buy authorized guys promised us We we’d available still between we’ve million

So continue be with that. to we will opportunistic

Robert Koort

Thank it. you. Got

Mark Rohr

Thank you.

Operator

question next Baird. Panjabi comes go The W. Robert Please from with Ghansham ahead.

Ghansham Panjabi

from network Good logistics? it as important the as be break to standpoint? not sort sort between and can back to guess, is acid adjustments, as productivity production, of guys. And part Hey, of you I feedstock forward that morning. a $XXX diversified savings million going your out boost of just acetic

Mark Rohr

feedstock the that. think there it Yes, things overcomes is in The U.S. that and normally next so standpoint. to good. would associated in logistics have be important economics we see like very is with that in from investment bases the diversified you this in we disadvantage a good stunningly and asset it’s it And incremental

reconfigure, if you because it’s the cost as So and value net sorts a for opportunity a you is that present it’s like is on unique and of not million. just million And restructure, important dependent said, us you and that message lower $XXX to can that Todd volume constant acid base to set for in on today back or drive to acetic it do achieve. $XXX pricing those of things approximately

foundation, business have available drive up, ourselves fully around utilization grows, tightens position capacity expect happen, So that’s you feel the this to it still the in to world. lift can If to get we’re floor, steps take that the to message, this increase we the to and is across. thematic trying whatever as happen again it which more market that to and may capacity that we yet

Ghansham Panjabi

mentioned bit generally, And to helpful. of of customers just, your seemed you looking Thanks out Can so Mark, can on more U.S. maybe well? optimistic then Europe you your Okay. then much. prepared as sort in comments, a some you on expand That’s that? And touch XXXX.

Mark Rohr

Yes.

think when – you us, works I the base have customer as time. a working really – to, we’re all you privileged do we great with to talk when

in that step we like everybody’s a many sort I’ll the very surprised rationalization to – bit. bit as quarter, quite and through They in see average lived are But ways not are We’ve stutter as global forward, reverse still they’re to fundamentals look in you largely in optimistic. the slowdown things things being and the and those customers, fourth they are. here with they our I of exists little on of think that consumers a shocked areas a all there. capacity through strong, the U.S. don’t gone expect continue, where anxiety or a see say the we when expecting that. are where

a as to there. So good enthusiasm order reaffirm seeing now. said, of the we’re what right And bit patterns that, Todd seem there’s

it’s to normal tied thing. there. went same Asia, say the to go is I’d that’s stutter as of trade well China seasonality, has which A through If anxiety this as it missing been lot over step. there you

that find waiting and New So the Chinese we’ll there to they’re a sitting way for with end moderate Year trade. somehow some of an to anticipation to anxiety

not is but entered further at think overly you they’re public would not a although, the we at this that So the we’re slide business And bit example, look pessimistic. if it we to we to case as of most which fundamentals probably – actually there, look year. rebound expecting in

customers are amount – now. into the right of and frightful I’d is I over if fair roll Chinese And our there’s largely Brexit. point. Europe, anxious in an there. Germany, so we anxiety a So it’s Europe, overly the pessimism or – of at overly talk not that Brexit look anxiety exit

I pressures they by point. impacted somewhat they’ve also trade. feel an been think And are Chinese in like political country anxiety

all things. we average So because we the that big most – I on Europe. And say Germany. see in customers are lot Rhine the of I think pessimism in a that’s of very River, of our see German-centric or that more out And our when

we Asia you’ll of as very recover see impacted to and starts recover, the out us see in don’t bit, U.S. this stabilize leading Europe think anxiety. is think as well. We we out see some And be ways to going leading Asia a I kind So the much. is what think of to we world start

Ghansham Panjabi

much, so Thanks Mark. Terrific.

Operator

from comes Please next question Fischer go The ahead. Barclays. with Duffy

Duffy Fischer

you. to good acetic question coming the just A fellows. around morning, in back acid Yes, strategy

million you a last permit tag. month capital $XXX filed the think I showed

And next about over to three impacting overall that think that decent we number? years? Celanese is should two, the one, the a capital So spend how

Mark Rohr

present right of would sort of those numbers preliminary are application. the the in numbers required Yes. to kind we’re range permit That’s It’s what number. we say. in of put I when And the

it’s directionally I’m correct. sorry, yes, So the what second? was

Duffy Fischer

Just capital. the

Mark Rohr

Yes.

to moving most So out million as this $XXX where get being in CapEx, XXXX, you’ll XXXX see coming into $XXX of year, up we million spent. think, I and this

yes, as So next million, this years above think, beyond the we’ll $XXX several year. into be we enter I moving

Duffy Fischer

in still your some even short net the methanol you’re Okay. And from then getting U.S., JV partner. though you’re

syngas integration As if more even were U.S. that net acid, the strategy does this own the want syngas methanol? you the you acetic on short to methanol? you What’s will bring in drive short you And there? to be plant,

Mark Rohr

I’ll hop start as this. well, And Todd, this please. you into

with We efficient Todd phase have most partnership highly grow. announced to the it’s with there expand and looking good wonderful a really that methanol. first to Mitsui acetic world’s methanol acid. syngas, as the talk options about of expansion plant with such. capacity I’ll are They’re On regarded guys the this with fit the of a and at let we

you do to… Todd, want So

Todd Elliott

the rate design out original operating of Yes, exceeded – capacity. run out has unit the rate methanol

So progress. we’re with pleased that

So that’s contributing.

net We’re still a buyer, a buyer.

that remains So unchanged.

looking are say to with options in announced our just together looking reconfiguration work methanol looking partner, the conjunction this Nothing with in We But our and ongoing at options ahead. U.S. for of the Mitsui. a that’s with just expansion our at part partner, point.

in could at more two there. So come actually were that we not integrated And the CO before. will phases. we look different question, options on your to But On it one. shape take

as Linde, source Mark our mentioned as partners CO well of there. we product. their So course, from

a we as who’s constructing speak. The other Praxair be will going new unit forward, partner

but It’s acetic step expanded So longer-term a Linde-Praxair think complementary also about footprint unique as merger. part very itself the the for Lake. the of in into presented acid opportunity step plan is through we a forward integration that small a as this Clear a

far more as it is so fits and methanol to on And alternatives. that good to we news come investigate So that integration.

Duffy Fischer

Thank Great. guys. you

Operator

question comes Capital from BMO go McNulty next with Markets. The Please John ahead.

John McNulty

anything should it questions. versus area thinking need how regard pretty Yes, you’re necessarily in be With it’s the my it’s growth thanks reading cutting we and growing the expansion close been that it, acetyl to the you’ve historically out same for into the an taking to regard et economics the Asian in compelling. out capacity? like on time, At the to region, certainly capacity cetera, that with about because looks long-term

Mark Rohr

assets I doesn’t It give with And doesn’t on a we’re No, very can sense. Asia. a It’s in – optionality. the it if our in bullish anything the put to of sense, our makes yes, from in think future. reconfigure imply we needs this option terms way remain more Asia, that beliefs you and we an we growth assets there so have forgo yourself And that around reconfiguring. with other aesthetic is bullish there going remain and

I a simply and I So at it step-change of earnings give future. our way look the in in the more up wouldn’t all, don’t at level base It’s – that to ourselves John. optionality company

John McNulty

was then a of And bit. China any question been have potential a closures to anything? It in around to in some certainly But for it. the are issues. about of to changes the and know topic how a outlook beyond? longer-term it’s you in last environmental off cooled we of I XXXX year. to on Or particular as – look terms capacity Got seems just – of little that kind are some starting the hear think there hot

Todd Elliott

don’t with to earlier actually circle I province a some the think came so come updates that we’re one We That’s policy, that’s in a just we news river. out Yunnan keep of changes, might Yangtze removed. saw province. direct is We a about conjunction reveals be into continuously. business so would the and to proximity River that specific on terms from The units that Yes, ton band out. come Linde Hubei the provinces, need studying that And got this unit. this out or it the unit XXX,XXX – we those. around guess, There’s track it’s in far acetyl impact and Shandong of see of

like plant XXX on for And chemical issued plants province Hubei there the that list, review. are XX. that mentioned So I there’s list December relocation think, are on

continues. And continues as published a information those. And specific will we it’s units, we look to drawn operating to we it at And be It provinces, from out. go. respective subject. direct real we as see so line real, And update

John McNulty

the for Great. color. Thanks

Operator

The comes from next Juvekar ahead. with question Please Citi. go P.J.

P.J. Juvekar

Yes, chemistry morning. connects were you how and impact production, it and you to the Mark, to Hey go able detail describe in CX And methanol. your increase how what hi, good you in MTO CX did if over in your that? margins? do wondering, increase to And your you acetyl or flex down I’m spreads Singapore production exactly did not, China China. to do

Mark Rohr

to what want you really in and a China also point maybe it’s price think spent that written in legacy between to I a – certainly the people I’ve as economics a just But and understand there strong how Well, too was script. the much make methanol that work. price in acetic point time tie on from China. want I view, – I acid But of

have that way up go we you and capacity global it you diminish. have optionality business and ways Todd at that disconnect find this globally, look you those the the And break starts to in utilization, as able then further As And that company things. to to start run two see away. we’re to Elliott

actions a around the lot of operate how our reselling, independent buying including world. So and than units rather we disconnect, including

drive in do, we did anything the the what special that. I always thing most to shareholders. that. So is which for our for I exactly wouldn’t create We value at look read did we optionality same

P.J. Juvekar

not with and into to issues China there. was say due fundamental. And weakness geopolitical read Okay. that And has you good business then intelligence your secondly, that really Mark, you guide Celanese

your become comment mind, at care in point fundamental you the to issues? issues Do So what on that? do geopolitical

Mark Rohr

and quite gone through gone a has the has last like Well, growth a last develop world the I know guess, mechanism. to answer question. that behavior period when of don’t go through how through Celanese years, the you several I certainly years, you

And so you is that that behavior inventory. covet

of that And things ripple because a the to like fast, have pump that kind delivery you feeling gets planning And a happens, production so effect of lasting is five do get the on cycle the of a to breaks, that all four ripple it’s the lasting masses, the says world the But rolls we’re three, the fire. that’s brakes of through. it, crowd, say, And feeling what not that And process, when inventories, has to effect pumped. months. somebody kind being stack-up if kind interrupted. in You today. or

when So of you this it I kind the mean? of stuff what means say I couple means. it brakes, pump It when is of quarters a does think what

Just cycles because that the time the again, of get of into. lag – you

So I than that our several cycles the more negative just economy takes really think some that. lot a geopolitical of to large happened into pressure and like set a has growth something like levels. but or – order It those drive country really our into

People brakes concerned the trade. U.S. think relationship. of relationship view They – just concerned this is that different They’re that’s the by about indication are not been the has China an so with just our So anxiety. a on of about pump levels in brought concerned quite about our the they’re quite

throughout needs in fundamentally, it’s political of mean, bit think a And will today. get starting to case level see underway spite have with little I that of to So bit play to a In Because the lot legal better. and to this the Britain. our – I – little trade we on bigger a uncertainty the that relative what’s of Europe, and effect a more with the going think actions that. relationship that are it’s China question of EU signs I it’s of happen that, to don’t trade just the to And whether more Europe. that’s of I better. ripple it’s add know hopefully, a in going some week and of

economy which think is belief I I we don’t the months. – brakes think couple think of my pump don’t So drop. we’ll a price how oil to for is long I our out stays that. see change. reason political situation no getting it it likely versus In worse fundamentally the way, gets if of of better. ourselves sort for as There’s come to

going I it’s think to get better.

P.J. Juvekar

Great. Thank detail. you the for

Operator

comes next ahead. go with Roberts question The UBS. John Please from

John Roberts

Are that Mexico. improve tactical In kind still cig continue take on to table like you in the cig business, you. over in there actions Thank any thinking about of the shutdown tow time? you’re strategic actions to tow, the

Mark Rohr

which through orders, the really as very yet. there out. the John, we’re obvious to matter only and I those customers want good Those The did we should quarter. to tow done asked it’s orders producers we need bit on And the that we certainly, we – And not only, unusual Street, trouble a anticipating the in reverse still a having were rolling it’s the not. fixed a the talked we relative And have very job logistically one’s in supply that are. it There feedback we an continue we just happen of to. working such was of into because think work making get couldn’t to something related things very would those. But of question us. first out communicate costs there surfaces expect which before little to but quarter, quarter. reliable also for also themselves, on And expect if And we – mid-XXs we’re a missed the several the just them get No part to time

John Roberts

channel? Or growth how between your do you’re data segment, supply the customers’ market have And chain what Engineered in data market into seeing you down contained any inventories primary you end or correction chain? much on plastics triangulating just Materials the versus in about selling are are supply then the where you’re on the basically what are

Mark Rohr

a We bit more today. triangulating did

kind to earnings high to we a April. that I in happen. relate level this update very of a more going think have to year’s what’s be view able And we’ll of that my comments on really

Chuck Kyrish

Hey, Jerry.

be We will final question. the make question next the

Operator

from ahead. And Vertical Research with that Kevin go Please will Partners. question McCarthy be

Kevin McCarthy

regard your With either for China Mark, I’m both? you’re a get could you’re acetyl to in dismantling production or Asia, or to you rationalization feel in whether rationalizing comment capacity Yes, as good capacity or Singapore? plans to trying morning. plans whether

Mark Rohr

options slightly, way one There’s your go question, value, that the just Well, fully we values – with committed happen make not site we’ve to in answer that. on depending to any way to yet. we’re which different

it’s we rationalize is if rationalized. intention Our capacity,

So that available. means it’s not

Kevin McCarthy

the on have what of not it need expect with margins comment segment Okay. syngas you internally or wheel coming a acetic happens could supplier? And impact or the on or your you acid would to any what back with acquisition, that whether your then to to unit, margins? hydrogen regard out gas you And that plant

Mark Rohr

acid. it’s impact is in – how it on in there. a the where capital through a worked avoiding you’re because invested you a capital on really same cost get. sat you’re levels on actual investment. return I and is going lower to the you on acetic return to produce going capital I haven’t see see if it. But Yes, to get marginal want you I know think you capital down that don’t impact it’s actually And then the the That’s And basis, it of take… return variable

Todd Elliott

the It footprint. Asian we flexibility, footprint, When operating right? think have, a fits, rate that when think we’ll range expanded Kevin, much there of than three and creates about we with the our more have sources fits it you of wide today

have fits CO with supplier and like the we industrial flexibility, it packaged operating an reference, integration, partner. for not it we or as network then then do hydrogen That fits with future our it which for in as part And with a requirement times decisions. would we rate of and process need arrangement the be So an gas internally. different consider up therefore

Kevin McCarthy

Thank you much. very

Chuck Kyrish

for great. today questions and in. Thanks, Okay, the listening everyone, for

after concerns have. questions further any call for today available the you or We’re

Operator

The presentation. conference Thank for attending has today’s now concluded. you

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