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QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
 12 Months Ended
Sep. 30, 2014
Quarterly Financial Information Disclosure [Abstract]  
QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
 
The following is a condensed summary of the company’s unaudited quarterly results of continuing operations for fiscal years 2014 and 2013. Amounts related to prior quarters have been recast to reflect Mascot in discontinued operations (see Note 3). Per share amounts are based on the weighted average shares outstanding for that quarter. Earnings per share for the year may not equal the sum of the four fiscal quarters’ earnings per share due to changes in basic and diluted shares outstanding.
 
 
2014 Fiscal Quarters (Unaudited)
 
First
 
Second
 
Third
 
Fourth
 
2014
 
(In millions, except share related data)
Sales
$
900

 
$
954

 
$
979

 
$
933

 
$
3,766

Cost of sales
(795
)
 
(836
)
 
(855
)
 
(793
)
 
(3,279
)
Gross margin
105

 
118

 
124

 
140

 
487

Provision for income taxes
(11
)
 
(8
)
 
(12
)
 
—

 
(31
)
Net income
13

 
3

 
234

 
4

 
254

Net income from continuing operations attributable to Meritor, Inc.
12

 
1

 
237

 
29

 
279

Net income attributable to Meritor, Inc.
11

 
1

 
234

 
3

 
249

Basic income per share from continuing operations
$
0.12

 
$
0.01

 
$
2.43

 
$
0.30

 
$
2.86

Diluted income per share from continuing operations
$
0.12

 
$
0.01

 
$
2.34

 
$
0.29

 
$
2.81



The company recognized restructuring costs in its continuing operations during fiscal year 2014 as follows: $1 million in the first quarter, $2 million in the second quarter and $7 million in the fourth quarter (see Note 5). During the fourth quarter of fiscal year 2014, the company reduced retiree medical expense by $15 million, in cost of sales on the consolidated statement of operations, due to a triggered curtailment (see Note 19). Net income in the third quarter of fiscal year 2014 includes after-tax proceeds of $209 million representing our share based on our ownership interest in ZF Meritor including a recovery of current and prior years' attorney expenses paid by Meritor.

 
2013 Fiscal Quarters (Unaudited)
 
First
 
Second
 
Third
 
Fourth
 
2013
 
(In millions, except share related data)
Sales
$
884

 
$
900

 
$
986

 
$
902

 
$
3,672

Cost of sales
(802
)
 
(805
)
 
(877
)
 
(793
)
 
(3,277
)
Gross margin
82

 
95

 
109

 
109

 
395

Provision for income taxes
(11
)
 
(7
)
 
(1
)
 
(45
)
 
(64
)
Net income
(20
)
 
(4
)
 
(39
)
 
43

 
(20
)
Net income (loss) from continuing operations attributable to Meritor, Inc.
(15
)
 
(3
)
 
(37
)
 
40

 
(15
)
Net income (loss) attributable to Meritor, Inc.
(21
)
 
(3
)
 
(39
)
 
41

 
(22
)
Basic income (loss) per share from continuing operations
$
(0.16
)
 
$
(0.03
)
 
$
(0.38
)
 
$
0.41

 
$
(0.15
)
Diluted income (loss) per share from continuing operations
$
(0.16
)
 
$
(0.03
)
 
$
(0.38
)
 
$
0.41

 
$
(0.15
)


The company recognized restructuring costs in its continuing operations during fiscal year 2013 as follows: $3 million in the first quarter, $11 million in the second quarter, $12 million in the third quarter and a reversal of $3 million in the fourth quarter (see Note 5). Net loss in the third quarter of fiscal year 2013 includes an after-tax settlement loss of approximately $27 million associated with the company settling five of its Canadian pension plans via lump-sum payments out of plan assets to participants and annuity contract purchases with an insurance company. During the fourth quarter of fiscal year 2013, the company recognized a $73 million non-cash settlement loss associated with lump-sum settlements to participants of its U.S. Retirement Plan. Also, the fourth quarter includes a $92 million gain (net of tax) associated with the sale of the company's 50-percent ownership interest in the Suspensys joint venture.