ÀÖÌìÌÃfun88(ÖйúÇø)¹Ù·½ÍøÕ¾

Quarterly report pursuant to Section 13 or 15(d)

Note 20 - Operating Segment Information

v3.21.2
Note 20 - Operating Segment Information
 6 Months Ended
Jun. 30, 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

Six months

 Ìý
Ìý Ìý

ended

 Ìý Ìý

ended

 Ìý
Ìý Ìý

June 30,

 Ìý Ìý

June 30,

 Ìý
Ìý Ìý

2021

 Ìý Ìý

2020

 Ìý Ìý

2021

 Ìý Ìý

2020

 Ìý

Revenues:

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Polyurethanes

 Ìý $ 1,155 Ìý Ìý $ 730 Ìý Ìý $ 2,223 Ìý Ìý $ 1,618 Ìý

Performance Products

 Ìý Ìý 371 Ìý Ìý Ìý 228 Ìý Ìý Ìý 676 Ìý Ìý Ìý 520 Ìý

Advanced Materials

 Ìý Ìý 299 Ìý Ìý Ìý 192 Ìý Ìý Ìý 577 Ìý Ìý Ìý 433 Ìý

Textile Effects

 Ìý Ìý 207 Ìý Ìý Ìý 102 Ìý Ìý Ìý 400 Ìý Ìý Ìý 282 Ìý

Corporate and eliminations

 Ìý Ìý (8 ) Ìý Ìý (5 ) Ìý Ìý (15 ) Ìý Ìý (13 )

Total

 Ìý $ 2,024 Ìý Ìý $ 1,247 Ìý Ìý $ 3,861 Ìý Ìý $ 2,840 Ìý
Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

ÀÖÌìÌÃfun88(ÖйúÇø)¹Ù·½ÍøÕ¾ Corporation:

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Segment adjusted EBITDA(1):

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Polyurethanes

 Ìý $ 208 Ìý Ìý $ 31 Ìý Ìý $ 415 Ìý Ìý $ 115 Ìý

Performance Products

 Ìý Ìý 88 Ìý Ìý Ìý 29 Ìý Ìý Ìý 151 Ìý Ìý Ìý 87 Ìý

Advanced Materials

 Ìý Ìý 58 Ìý Ìý Ìý 30 Ìý Ìý Ìý 102 Ìý Ìý Ìý 78 Ìý

Textile Effects

 Ìý Ìý 28 Ìý Ìý Ìý (4 ) Ìý Ìý 53 Ìý Ìý Ìý 16 Ìý

Corporate and other(2)

 Ìý Ìý (48 ) Ìý Ìý (32 ) Ìý Ìý (98 ) Ìý Ìý (77 )

Total

 Ìý Ìý 334 Ìý Ìý Ìý 54 Ìý Ìý Ìý 623 Ìý Ìý Ìý 219 Ìý

Reconciliation of adjusted EBITDA to net income (loss):

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Interest expense, net—continuing operations

 Ìý Ìý (18 ) Ìý Ìý (21 ) Ìý Ìý (37 ) Ìý Ìý (39 )

Income tax (expense) benefit—continuing operations

 Ìý Ìý (42 ) Ìý Ìý 13 Ìý Ìý Ìý (76 ) Ìý Ìý 6 Ìý

Income tax expense—discontinued operations

 Ìý Ìý â€� Ìý Ìý Ìý (1 ) Ìý Ìý â€� Ìý Ìý Ìý (239 )

Depreciation and amortization—continuing operations

 Ìý Ìý (73 ) Ìý Ìý (69 ) Ìý Ìý (147 ) Ìý Ìý (136 )

Net income attributable to noncontrolling interests

 Ìý Ìý 16 Ìý Ìý Ìý 3 Ìý Ìý Ìý 33 Ìý Ìý Ìý 6 Ìý

Other adjustments:

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Business acquisition and integration expenses and purchase accounting inventory adjustments

 Ìý Ìý (5 ) Ìý Ìý (8 ) Ìý Ìý (14 ) Ìý Ìý (21 )

EBITDA from discontinued operations(3)

 Ìý Ìý 1 Ìý Ìý Ìý 6 Ìý Ìý Ìý 2 Ìý Ìý Ìý 1,021 Ìý

Fair value adjustments to Venator investment

 Ìý Ìý (6 ) Ìý Ìý 4 Ìý Ìý Ìý (25 ) Ìý Ìý (106 )

Loss on early extinguishment of debt

 Ìý Ìý (27 ) Ìý Ìý â€� Ìý Ìý Ìý (27 ) Ìý Ìý â€� Ìý

Certain legal and other settlements and related expenses

 Ìý Ìý (8 ) Ìý Ìý (4 ) Ìý Ìý (10 ) Ìý Ìý (6 )

Gain (loss) on sale of businesses/assets

 Ìý Ìý 30 Ìý Ìý Ìý (1 ) Ìý Ìý 30 Ìý Ìý Ìý 1 Ìý

Income from transition services arrangements

 Ìý Ìý 3 Ìý Ìý Ìý 5 Ìý Ìý Ìý 4 Ìý Ìý Ìý 5 Ìý

Certain nonrecurring information technology project implementation costs

 Ìý Ìý (3 ) Ìý Ìý (1 ) Ìý Ìý (4 ) Ìý Ìý (2 )

Amortization of pension and postretirement actuarial losses

 Ìý Ìý (21 ) Ìý Ìý (19 ) Ìý Ìý (43 ) Ìý Ìý (37 )

Plant incident remediation credits (costs)

 Ìý Ìý 3 Ìý Ìý Ìý (1 ) Ìý Ìý (1 ) Ìý Ìý (1 )

Restructuring, impairment and plant closing and transition costs

 Ìý Ìý (12 ) Ìý Ìý (19 ) Ìý Ìý (36 ) Ìý Ìý (22 )

Net income (loss)

 Ìý $ 172 Ìý Ìý $ (59 ) Ìý $ 272 Ìý Ìý $ 649 Ìý

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Ìý Ìý

Three months

 Ìý Ìý

Six months

 Ìý
Ìý Ìý

ended

 Ìý Ìý

ended

 Ìý
Ìý Ìý

June 30,

 Ìý Ìý

June 30,

 Ìý
Ìý Ìý

2021

 Ìý Ìý

2020

 Ìý Ìý

2021

 Ìý Ìý

2020

 Ìý

ÀÖÌìÌÃfun88(ÖйúÇø)¹Ù·½ÍøÕ¾ International:

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Segment adjusted EBITDA(1):

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Polyurethanes

 Ìý $ 208 Ìý Ìý $ 31 Ìý Ìý $ 415 Ìý Ìý $ 115 Ìý

Performance Products

 Ìý Ìý 88 Ìý Ìý Ìý 29 Ìý Ìý Ìý 151 Ìý Ìý Ìý 87 Ìý

Advanced Materials

 Ìý Ìý 58 Ìý Ìý Ìý 30 Ìý Ìý Ìý 102 Ìý Ìý Ìý 78 Ìý

Textile Effects

 Ìý Ìý 28 Ìý Ìý Ìý (4 ) Ìý Ìý 53 Ìý Ìý Ìý 16 Ìý

Corporate and other(2)

 Ìý Ìý (46 ) Ìý Ìý (30 ) Ìý Ìý (93 ) Ìý Ìý (74 )

Total

 Ìý Ìý 336 Ìý Ìý Ìý 56 Ìý Ìý Ìý 628 Ìý Ìý Ìý 222 Ìý

Reconciliation of adjusted EBITDA to net income (loss):

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Interest expense, net—continuing operations

 Ìý Ìý (18 ) Ìý Ìý (21 ) Ìý Ìý (37 ) Ìý Ìý (41 )

Income tax (expense) benefit—continuing operations

 Ìý Ìý (41 ) Ìý Ìý 13 Ìý Ìý Ìý (76 ) Ìý Ìý 6 Ìý

Income tax expense—discontinued operations

 Ìý Ìý â€� Ìý Ìý Ìý (1 ) Ìý Ìý â€� Ìý Ìý Ìý (239 )

Depreciation and amortization—continuing operations

 Ìý Ìý (74 ) Ìý Ìý (69 ) Ìý Ìý (147 ) Ìý Ìý (136 )

Net income attributable to noncontrolling interests

 Ìý Ìý 16 Ìý Ìý Ìý 3 Ìý Ìý Ìý 33 Ìý Ìý Ìý 6 Ìý

Other adjustments:

 Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý

Business acquisition and integration expenses and purchase accounting inventory adjustments

 Ìý Ìý (5 ) Ìý Ìý (8 ) Ìý Ìý (14 ) Ìý Ìý (21 )

EBITDA from discontinued operations(3)

 Ìý Ìý 1 Ìý Ìý Ìý 6 Ìý Ìý Ìý 2 Ìý Ìý Ìý 1,021 Ìý

Fair value adjustments to Venator investment

 Ìý Ìý (6 ) Ìý Ìý 4 Ìý Ìý Ìý (25 ) Ìý Ìý (106 )

Loss on early extinguishment of debt

 Ìý Ìý (27 ) Ìý Ìý â€� Ìý Ìý Ìý (27 ) Ìý Ìý â€� Ìý

Certain legal and other settlements and related expenses

 Ìý Ìý (8 ) Ìý Ìý (4 ) Ìý Ìý (10 ) Ìý Ìý (6 )

Gain (loss) on sale of businesses/assets

 Ìý Ìý 30 Ìý Ìý Ìý (1 ) Ìý Ìý 30 Ìý Ìý Ìý 1 Ìý

Income from transition services arrangements

 Ìý Ìý 3 Ìý Ìý Ìý 5 Ìý Ìý Ìý 4 Ìý Ìý Ìý 5 Ìý

Certain nonrecurring information technology project implementation costs

 Ìý Ìý (3 ) Ìý Ìý (1 ) Ìý Ìý (4 ) Ìý Ìý (2 )

Amortization of pension and postretirement actuarial losses

 Ìý Ìý (22 ) Ìý Ìý (21 ) Ìý Ìý (45 ) Ìý Ìý (39 )

Plant incident remediation credits (costs)

 Ìý Ìý 3 Ìý Ìý Ìý (1 ) Ìý Ìý (1 ) Ìý Ìý (1 )

Restructuring, impairment and plant closing and transition costs

 Ìý Ìý (12 ) Ìý Ìý (19 ) Ìý Ìý (36 ) Ìý Ìý (22 )

Net income (loss)

 Ìý $ 173 Ìý Ìý $ (59 ) Ìý $ 275 Ìý Ìý $ 648 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) loss on early extinguishment of debt; (e) certain legal and other settlements and related expenses; (f) gain (loss) on sale of businesses/assets; (g) income from transition services arrangements related to the sale of our Chemical Intermediates Businesses to Indorama; (h) certain nonrecurring information technology project implementation costs; (i) amortization of pension and postretirement actuarial losses; (j) plant incident remediation creditsÌý(costs); and (k) 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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