Equity Method Investments

12 Months Ended

Dec. 31, 2020

Equity Method Investments and Joint Ventures [Abstract]

The Company’s equity method investments include its joint venture interest in Middlemount and certain other equity method investments.

The table below summarizes the book value of those investments and related financing receivables, which are reported in “Investments and other assets” in the consolidated balance sheets, and the related “Loss (income) from equity affiliates”:


	Book Value at				Loss (Income) from Equity Affiliates
	December 31,				Year Ended December 31,
	2020		2019		2020		2019		2018
	(Dollars in millions)
Equity method investment and financing receivables related to Middlemount	$	24.6	$	56.3	$	60.1	$	(9.0)	$	(69.3)
Other equity method investments	—		0.6		—		5.6		1.2
Total equity method investments and financing receivables related to Middlemount	$	24.6	$	56.9	$	60.1	$	(3.4)	$	(68.1)

The Company received cash payments from Middlemount of $14.7 million and $106.7 million during the years ended December 31, 2019 and 2018, respectively, related to financing receivables. No payments were received from Middlemount during the year ended December 31, 2020.

One of the Company’s Australian subsidiaries and the other shareholder of Middlemount are parties to an agreement, as amended from time to time, to provide a revolving loan (Revolving Loans) to Middlemount. The Company’s participation in the Revolving Loans will not, at any time, exceed its 50% equity interest of the revolving loan limit. At December 31, 2020, the revolving loan limit was $160 million Australian dollars, and Middlemount had not fully drawn upon the Revolving Loans. The Revolving Loans bear interest at 10% per annum and expire on December 31, 2021. The carrying value of the portion of the Revolving Loans due to the Company’s Australian subsidiary, which is included in the total investment balance, was $46.2 million and $17.5 million as of December 31, 2020 and 2019, respectively, with the increase during the year ended December 31, 2020 attributable to the Company’s share of additional funding.

As of both December 31, 2020 and 2019, the financing receivables and Revolving Loans are accounted for as in-substance common stock due to the limited fair value attributed to Middlemount’s equity.

During the year ended December 31, 2018, the Company determined that a valuation allowance on Middlemount’s net deferred tax position was no longer necessary based on recent cumulative earnings and expectation of future earnings. The determination resulted in approximately $9 million of income which was more than offset by a tax reserve of approximately $17 million due to an uncertain tax position relating to an ongoing income tax audit of Middlemount. During the year ended December 31, 2019, Middlemount received notification that the Australian Taxation Office would no longer pursue its position, and the related tax reserve was released. During the year ended December 31, 2020, the Company established a valuation allowance on Middlemount’s net deferred tax position of approximately $33 million primarily based upon recent cumulative losses.

During the years ended December 31, 2020, 2019 and 2018, respectively, Middlemount generated revenues of approximately $123 million, $160 million and $271 million (on a 50% basis).

Middlemount had current assets, noncurrent assets, current liabilities and noncurrent liabilities of $31.0 million, $301.8 million, $273.8 million and $83.5 million, respectively, as of December 31, 2020 and $30.8 million, $209.7 million, $225.8 million and $40.1 million, respectively, as of December 31, 2019 (on a 50% basis).