ÀÖÌìÌÃfun88(ÖйúÇø)¹Ù·½ÍøÕ¾

Quarterly report pursuant to Section 13 or 15(d)

Note 20 - Operating Segment Information

v3.21.1
Note 20 - Operating Segment Information
 3 Months Ended
Mar. 31, 2021
Notes to Financial Statements Ìý
Segment Reporting Disclosure [Text Block]

20. OPERATING SEGMENT INFORMATION

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We derive our revenues, earnings and cash flows from the manufacture and sale of a wide variety of differentiated and commodity chemical products. We have four operating segments, which are also our reportable segments: Polyurethanes, Performance Products, Advanced Materials and Textile Effects. We have organized our business and derived our operating segments around differences in product lines.

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The major products of each reportable operating segment are as follows:

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Segment

ÌýÌýÌýÌý

Products

Polyurethanes

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MDI, polyols, TPU and other polyurethane-related products

PerformanceÌýProducts

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Specialty amines, ethyleneamines, maleic anhydride and technology licenses

Advanced Materials

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Basic liquid and solid epoxy resins; specialty resin compounds; cross-linking, matting, and curing and toughening agents; epoxy, acrylic and polyurethane-based formulations; specialty nitrile latex, alkyd resins and carbon nano materials

Textile Effects

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Textile chemicals andÌýdyes

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Sales between segments are generally recognized at external market prices and are eliminated in consolidation. Adjusted EBITDA is presented as a measure of the financial performance of our global business units and for reporting the results of our operating segments. The adjusted EBITDA of our reportable operating segments excludes items that principally apply to our Company as a whole. The revenues and adjusted EBITDA from continuing operations for each of our reportable operating segments are as follows (dollars in millions):

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Ìý Ìý

Three months

 Ìý
Ìý Ìý

ended

 Ìý
Ìý Ìý

March 31,

 Ìý
Ìý Ìý

2021

 Ìý Ìý

2020

 Ìý

Revenues:

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Polyurethanes

 Ìý $ 1,068 Ìý Ìý $ 888 Ìý

Performance Products

 Ìý Ìý 305 Ìý Ìý Ìý 292 Ìý

Advanced Materials

 Ìý Ìý 278 Ìý Ìý Ìý 241 Ìý

Textile Effects

 Ìý Ìý 193 Ìý Ìý Ìý 180 Ìý

Corporate and eliminations

 Ìý Ìý (7 ) Ìý Ìý (8 )

Total

 Ìý $ 1,837 Ìý Ìý $ 1,593 Ìý
Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

ÀÖÌìÌÃfun88(ÖйúÇø)¹Ù·½ÍøÕ¾ Corporation:

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Segment adjusted EBITDA(1):

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Polyurethanes

 Ìý $ 207 Ìý Ìý $ 84 Ìý

Performance Products

 Ìý Ìý 63 Ìý Ìý Ìý 58 Ìý

Advanced Materials

 Ìý Ìý 44 Ìý Ìý Ìý 48 Ìý

Textile Effects

 Ìý Ìý 25 Ìý Ìý Ìý 20 Ìý

Corporate and other(2)

 Ìý Ìý (50 ) Ìý Ìý (45 )

Total

 Ìý Ìý 289 Ìý Ìý Ìý 165 Ìý

Reconciliation of adjusted EBITDA to net income:

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Interest expense, net—continuing operations

 Ìý Ìý (19 ) Ìý Ìý (18 )

Income tax expense—continuing operations

 Ìý Ìý (34 ) Ìý Ìý (7 )

Income tax expense—discontinued operations

 Ìý Ìý â€� Ìý Ìý Ìý (238 )

Depreciation and amortization—continuing operations

 Ìý Ìý (74 ) Ìý Ìý (67 )

Net income attributable to noncontrolling interests

 Ìý Ìý 17 Ìý Ìý Ìý 3 Ìý

Other adjustments:

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Business acquisition and integration expenses and purchase accounting inventory adjustments

 Ìý Ìý (9 ) Ìý Ìý (13 )

EBITDA from discontinued operations(3)

 Ìý Ìý 1 Ìý Ìý Ìý 1,015 Ìý

Fair value adjustments to Venator investment

 Ìý Ìý (19 ) Ìý Ìý (110 )

Certain legal and other settlements and related expenses

 Ìý Ìý (2 ) Ìý Ìý (2 )

Gain on sale of businesses/assets

 Ìý Ìý â€� Ìý Ìý Ìý 2 Ìý

Income from transition services arrangements

 Ìý Ìý 1 Ìý Ìý Ìý â€� Ìý

Certain nonrecurring information technology project implementation costs

 Ìý Ìý (1 ) Ìý Ìý (1 )

Amortization of pension and postretirement actuarial losses

 Ìý Ìý (22 ) Ìý Ìý (18 )

Plant incident remediation costs

 Ìý Ìý (4 ) Ìý Ìý â€� Ìý

Restructuring, impairment and plant closing and transition costs

 Ìý Ìý (24 ) Ìý Ìý (3 )

Net income

 Ìý $ 100 Ìý Ìý $ 708 Ìý

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Ìý Ìý

Three months

 Ìý
Ìý Ìý

ended

 Ìý
Ìý Ìý

March 31,

 Ìý
Ìý Ìý

2021

 Ìý Ìý

2020

 Ìý

ÀÖÌìÌÃfun88(ÖйúÇø)¹Ù·½ÍøÕ¾ International:

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Segment adjusted EBITDA(1):

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý
Polyurethanes Ìý $ 207 Ìý Ìý $ 84 Ìý
Performance Products Ìý Ìý 63 Ìý Ìý Ìý 58 Ìý
Advanced Materials Ìý Ìý 44 Ìý Ìý Ìý 48 Ìý
Textile Effects Ìý Ìý 25 Ìý Ìý Ìý 20 Ìý
Corporate and other(2) Ìý Ìý (47 ) Ìý Ìý (44 )
Total Ìý Ìý 292 Ìý Ìý Ìý 166 Ìý

Reconciliation of adjusted EBITDA to net income:

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý
Interest expense, net—continuing operations Ìý Ìý (19 ) Ìý Ìý (20 )
Income tax expense—continuing operations Ìý Ìý (35 ) Ìý Ìý (7 )
Income tax expense—discontinued operations Ìý Ìý â€� Ìý Ìý Ìý (238 )
Depreciation and amortization—continuing operations Ìý Ìý (73 ) Ìý Ìý (67 )
Net income attributable to noncontrolling interests Ìý Ìý 17 Ìý Ìý Ìý 3 Ìý
Other adjustments: Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý
Business acquisition and integration expenses and purchase accounting inventory adjustments Ìý Ìý (9 ) Ìý Ìý (13 )
EBITDA from discontinued operations(3) Ìý Ìý 1 Ìý Ìý Ìý 1,015 Ìý
Fair value adjustments to Venator investment Ìý Ìý (19 ) Ìý Ìý (110 )
Certain legal and other settlements and related expenses Ìý Ìý (2 ) Ìý Ìý (2 )
Gain on sale of businesses/assets Ìý Ìý â€� Ìý Ìý Ìý 2 Ìý
Income from transition services arrangements Ìý Ìý 1 Ìý Ìý Ìý â€� Ìý
Certain nonrecurring information technology project implementation costs Ìý Ìý (1 ) Ìý Ìý (1 )
Amortization of pension and postretirement actuarial losses Ìý Ìý (23 ) Ìý Ìý (18 )
Plant incident remediation costs Ìý Ìý (4 ) Ìý Ìý â€� Ìý
Restructuring, impairment and plant closing and transition costs Ìý Ìý (24 ) Ìý Ìý (3 )
Net income Ìý $ 102 Ìý Ìý $ 707 Ìý

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(1)

We use segment adjusted EBITDA as the measure of each segment’s profit or loss. We believe that segment adjusted EBITDA more accurately reflects what the chief operating decision maker uses to make decisions about resources to be allocated to the segments and assess their financial performance. Segment adjusted EBITDA is defined as netÌýincome of ÀÖÌìÌÃfun88(ÖйúÇø)¹Ù·½ÍøÕ¾ Corporation or ÀÖÌìÌÃfun88(ÖйúÇø)¹Ù·½ÍøÕ¾ International, as appropriate, before interest, income tax, depreciation and amortization, net income attributable to noncontrolling interests and certain Corporate and other items, as well as eliminating the following adjustments: (a) business acquisition and integration expenses and purchase accounting inventory adjustments; (b)ÌýEBITDA from discontinued operations; (c) fair value adjustments to Venator investment; (d) certain legal and other settlements and related expenses; (e) gain on sale of businesses/assets; (f) income from transition services arrangements related to the sale of our Chemical Intermediates Businesses to Indorama; (g) certain nonrecurring information technology project implementation costs; (h) amortization of pension and postretirement actuarial losses; (i) plant incident remediation costs; and (j) restructuring, impairment, plant closing and transition costs.

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(2)

Corporate and other includes unallocated corporate overhead, unallocated foreign exchange gains and losses, LIFO inventory valuation reserve adjustments, loss on early extinguishment of debt, unallocated restructuring, impairment and plant closing costs, nonoperating income and expense and gains and losses on the disposition of corporate assets.

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