Celanese (CE) To Refinance Existing Secured Credit Facility

Chemical and advanced materials maker, Celanese Corporation (NYSE:CE) declared that it has initiated a transaction to refinance its existing secured credit facility with a new credit facility consisting of an unsecured term loan and an unsecured revolver.

Celanese is working towards investment grade credit rating and the company has delivered considerable earnings growth. It has deleveraged its balance sheet along with maintaining its credit metric within the investment grade level.

The company also aims to maintain a healthy balance sheet which will enable it to implement its growth strategies. This will also reinforce Celanese’s disciplined M&A approach, encourage shareholder cash return commitments and lower its cost of borrowing. The company plans to maintain a targeted leverage ratio of gross debt to EBITDA of 2.0 or lower on a long-term basis.

Celanese has set its goal to create value and deliver growth to its shareholders. In Apr 2016, the company revised its outlook for 2016 and now sees adjusted earnings per share to increase 8%–10%, up from 5%–10% anticipated earlier. If the economy recovers in the second half of the year, the company may attain the higher end of the revised outlook range.

CELANESE CP-A Price

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Celanese’s adjusted earnings for the first quarter 2016 were $1.83 per share, a 6% increase from the prior-year quarter. Earnings also beat the Zacks Consensus Estimate of $1.52 per share. Revenues for the quarter fell roughly 3% year on year to $1,404 million, but beat the Zacks Consensus Estimate.

Currently, Celanese has a Zacks Rank #3 (Hold).

Some better-ranked companies in the chemical space include Albemarle Corporation (NYSE:ALB) , BASF SE (OTC:BASFY) and Asahi Kasei Corp. (OTC:AHKSY) , all of them sporting a Zacks Rank #1 (Strong Buy).

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