Supplemental Guarantor Condensed Consolidating Financial Statements (Tables)

9 Months Ended

Jun. 30, 2017

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Schedule of condensed consolidating statement of operations



	Three Months Ended June 30, 2017
	Parent			Guarantors			Non- Guarantors			Elims			Consolidated
Sales
External	$	—		$	528		$	392		$	—		$	920
Subsidiaries	—			33			77			(110		)	—
Total sales	—			561			469			(110		)	920
Cost of sales	(13		)	(480		)	(395		)	110			(778		)
GROSS MARGIN	(13		)	81			74			—			142
Selling, general and administrative	(34		)	(14		)	(25		)	—			(73		)
Restructuring costs	—			1			(1		)	—			—
Other operating income (expense), net	(1		)	—			1			—			—
OPERATING INCOME (LOSS)	(48		)	68			49			—			69
Other income (expense), net	12			(7		)	(4		)	—			1
Equity in earnings of affiliates	—			12			2			—			14
Interest income (expense), net	(32		)	8			3			—			(21		)
INCOME (LOSS) BEFORE INCOME TAXES	(68		)	81			50			—			63
Benefit (provision) for income taxes	19			(21		)	(9		)	—			(11		)
Equity income from continuing operations of subsidiaries	98			34			—			(132		)	—
INCOME FROM CONTINUING OPERATIONS	49			94			41			(132		)	52
LOSS FROM DISCONTINUED OPERATIONS, net of tax	(1		)	—			—			—			(1		)
NET INCOME	48			94			41			(132		)	51
Less: Net income attributable to noncontrolling interests	—			—			(3		)	—			(3		)
NET INCOME ATTRIBUTABLE TO MERITOR, INC.	$	48		$	94		$	38		$	(132	)	$	48



	Three Months Ended June 30, 2016
	Parent			Guarantors			Non- Guarantors			Elims			Consolidated
Sales
External	$	—		$	410		$	431		$	—		$	841
Subsidiaries	—			30			14			(44		)	—
Total sales	—			440			445			(44		)	841
Cost of sales	(14		)	(361		)	(383		)	44			(714		)
GROSS MARGIN	(14		)	79			62			—			127
Selling, general and administrative	(23		)	(20		)	(16		)	—			(59		)
Restructuring costs	—			(3		)	(3		)	—			(6		)
Other operating income, net	—			—			—			—			—
OPERATING INCOME (LOSS)	(37		)	56			43			—			62
Other income (expense), net	8			(48		)	40			—			—
Equity in earnings of affiliates	—			8			1			—			9
Interest income (expense), net	(29		)	8			1			—			(20		)
INCOME (LOSS) BEFORE INCOME TAXES	(58		)	24			85			—			51
Provision for income taxes	(1		)	—			(7		)	—			(8		)
Equity income from continuing operations of subsidiaries	101			74			—			(175		)	—
INCOME FROM CONTINUING OPERATIONS	42			98			78			(175		)	43
LOSS FROM DISCONTINUED OPERATIONS, net of tax	(1		)	—			—			—			(1		)
NET INCOME	41			98			78			(175		)	42
Less: Net income attributable to noncontrolling interests	—			—			(1		)	—			(1		)
NET INCOME ATTRIBUTABLE TO MERITOR, INC.	$	41		$	98		$	77		$	(175	)	$	41



	Nine Months Ended June 30, 2017
	Parent			Guarantors			Non- Guarantors			Elims			Consolidated
Sales
External	$	—		$	1,244		$	1,181		$	—		$	2,425
Subsidiaries	—			89			103			(192		)	—
Total sales	—			1,333			1,284			(192		)	2,425
Cost of sales	(42		)	(1,122		)	(1,101		)	192			(2,073		)
GROSS MARGIN	(42		)	211			183			—			352
Selling, general and administrative	(77		)	(67		)	(48		)	—			(192		)
Restructuring costs	2			(1		)	(5		)	—			(4		)
Other operating expense, net	(3		)	—			(2		)	—			(5		)
OPERATING INCOME (LOSS)	(120		)	143			128			—			151
Other income (expense), net	36			(12		)	(23		)	—			1
Equity in earnings of affiliates	—			27			5			—			32
Interest income (expense), net	(99		)	27			9			—			(63		)
INCOME (LOSS) BEFORE INCOME TAXES	(183		)	185			119			—			121
Benefit (provision) for income taxes	54			(56		)	(28		)	—			(30		)
Equity income from continuing operations of subsidiaries	215			75			—			(290		)	—
INCOME FROM CONTINUING OPERATIONS	86			204			91			(290		)	91
LOSS FROM DISCONTINUED OPERATIONS, net of tax	(1		)	—			—			—			(1		)
NET INCOME	85			204			91			(290		)	90
Less: Net income attributable to noncontrolling interests	—			—			(5		)	—			(5		)
NET INCOME ATTRIBUTABLE TO MERITOR, INC.	$	85		$	204		$	86		$	(290	)	$	85



	Nine Months Ended June 30, 2016
	Parent			Guarantors			Non- Guarantors			Elims			Consolidated
Sales
External	$	—		$	1,247		$	1,224		$	—		$	2,471
Subsidiaries	—			85			46			(131		)	—
Total sales	—			1,332			1,270			(131		)	2,471
Cost of sales	(40		)	(1,107		)	(1,103		)	131			(2,119		)
GROSS MARGIN	(40		)	225			167			—			352
Selling, general and administrative	(62		)	(62		)	(51		)	—			(175		)
Restructuring costs	—			(4		)	(5		)	—			(9		)
Other operating expense, net	(3		)	—			—			—			(3		)
OPERATING INCOME (LOSS)	(105		)	159			111			—			165
Other income (expense), net	42			(57		)	14			—			(1		)
Equity in earnings of affiliates	—			24			2			—			26
Interest income (expense), net	(88		)	23			2			—			(63		)
INCOME (LOSS) BEFORE INCOME TAXES	(151		)	149			129			—			127
Provision for income taxes	(1		)	—			(21		)	—			(22		)
Equity income from continuing operations of subsidiaries	255			95			—			(350		)	—
INCOME FROM CONTINUING OPERATIONS	103			244			108			(350		)	105
LOSS FROM DISCONTINUED OPERATIONS, net of tax	(4		)	(5		)	(4		)	9			(4		)
NET INCOME	99			239			104			(341		)	101
Less: Net income attributable to noncontrolling interests	—			—			(2		)	—			(2		)
NET INCOME ATTRIBUTABLE TO MERITOR, INC.	$	99		$	239		$	102		$	(341	)	$	99

Schedule of condensed consolidating statement of comprehensive income (loss)



	Three Months Ended June 30, 2017
	Parent		Guarantors		Non- Guarantors			Elims			Consolidated
Net income	$	48	$	94	$	41		$	(132	)	$	51
Other comprehensive income, net of tax	26		—		18			(18		)	26
Total comprehensive income	74		94		59			(150		)	77
Less: Comprehensive loss (income) attributable to noncontrolling interests	1		—		(4		)	—			(3		)
Comprehensive income attributable to Meritor, Inc.	$	75	$	94	$	55		$	(150	)	$	74



	Three Months Ended June 30, 2016
	Parent		Guarantors		Non- Guarantors			Elims			Consolidated
Net income	$	41	$	98	$	78		$	(175	)	$	42
Other comprehensive income (loss)	—		44		(50		)	6			—
Total comprehensive income	41		142		28			(169		)	42
Less: Comprehensive income attributable to noncontrolling interests	—		—		(1		)	—			(1		)
Comprehensive income attributable to Meritor, Inc.	$	41	$	142	$	27		$	(169	)	$	41



	Nine Months Ended June 30, 2017
	Parent		Guarantors		Non- Guarantors			Elims			Consolidated
Net income	$	85	$	204	$	91		$	(290	)	$	90
Other comprehensive income, net of tax	40		2		12			(14		)	40
Total comprehensive income	125		206		103			(304		)	130
Less: Comprehensive loss (income) attributable to noncontrolling interests	1		—		(5		)	—			(4		)
Comprehensive income attributable to Meritor, Inc.	$	126	$	206	$	98		$	(304	)	$	126



	Nine Months Ended June 30, 2016
	Parent		Guarantors		Non- Guarantors			Elims			Consolidated
Net income	$	99	$	239	$	104		$	(341	)	$	101
Other comprehensive income (loss), net of tax	24		56		(52		)	(4		)	24
Total comprehensive income	123		295		52			(345		)	125
Less: Comprehensive income attributable to noncontrolling interests	—		—		(2		)	—			(2		)
Comprehensive income attributable to Meritor, Inc.	$	123	$	295	$	50		$	(345	)	$	123

Schedule of condensed consolidating balance sheet



	June 30, 2017
	Parent			Guarantors			Non- Guarantors		Elims			Consolidated
CURRENT ASSETS:
Cash and cash equivalents ⁽¹⁾	$	150		$	4		$	77	$	—		$	231
Receivables trade and other, net ⁽¹⁾	1			43			456		—			500
Inventories ⁽¹⁾	—			165			195		—			360
Other current assets	5			14			18		—			37
TOTAL CURRENT ASSETS	156			226			746		—			1,128
NET PROPERTY ⁽¹⁾	21			201			208		—			430
GOODWILL ⁽¹⁾	—			219			172		—			391
OTHER ASSETS	437			129			197		—			763
INVESTMENTS IN SUBSIDIARIES	2,866			769			—		(3,635		)	—
TOTAL ASSETS	$	3,480		$	1,544		$	1,323	$	(3,635	)	$	2,712
CURRENT LIABILITIES:
Short-term debt	$	128		$	3		$	1	$	—		$	132
Accounts and notes payable ⁽¹⁾	51			230			321		—			602
Other current liabilities	103			70			104		—			277
TOTAL CURRENT LIABILITIES	282			303			426		—			1,011
LONG-TERM DEBT	850			1			7		—			858
RETIREMENT BENEFITS	645			—			22		—			667
INTERCOMPANY PAYABLE (RECEIVABLE)	1,744			(1,966		)	222		—			—
OTHER LIABILITIES	31			146			43		—			220
MEZZANINE EQUITY	12			—			—		—			12
EQUITY (DEFICIT) ATTRIBUTABLE TO MERITOR, INC.	(84		)	3,060			575		(3,635		)	(84		)
NONCONTROLLING INTERESTS ⁽¹⁾	—			—			28		—			28
TOTAL LIABILITIES, MEZZANINE EQUITY AND DEFICIT	$	3,480		$	1,544		$	1,323	$	(3,635	)	$	2,712

⁽¹⁾ As of June 30, 2017, Assets and Liabilities held for sale were: (i) $1 million Cash and cash equivalents; (ii) $11 million Receivables, trade and other, net; (iii) $2 million Inventories; (iv) $3 million Net property; (v) $1 million Goodwill; (vi) $10 million Accounts and notes payable; and (vii) $2 million Noncontrolling interests. These assets and liabilities held for sale are included in the Non-Guarantors column.



	September 30, 2016
	Parent			Guarantors			Non- Guarantors		Elims			Consolidated
CURRENT ASSETS:
Cash and cash equivalents ⁽¹⁾	$	90		$	4		$	66	$	—		$	160
Receivables trade and other, net ⁽¹⁾	1			39			356		—			396
Inventories ⁽¹⁾	—			143			173		—			316
Other current assets	5			12			16		—			33
TOTAL CURRENT ASSETS	96			198			611		—			905
NET PROPERTY ⁽¹⁾	22			198			219		—			439
GOODWILL	—			219			171		—			390
OTHER ASSETS	447			132			181		—			760
INVESTMENTS IN SUBSIDIARIES	2,575			679			—		(3,254		)	—
TOTAL ASSETS	$	3,140		$	1,426		$	1,182	$	(3,254	)	$	2,494
CURRENT LIABILITIES:
Short-term debt	$	1		$	4		$	9	$	—		$	14
Accounts and notes payable ⁽¹⁾	42			172			261		—			475
Other current liabilities	90			74			104		—			268
TOTAL CURRENT LIABILITIES	133			250			374		—			757
LONG-TERM DEBT	971			3			8		—			982
RETIREMENT BENEFITS	680			—			23		—			703
INTERCOMPANY PAYABLE (RECEIVABLE)	1,534			(1,768		)	234		—			—
OTHER LIABILITIES	34			162			42		—			238
EQUITY (DEFICIT) ATTRIBUTABLE TO MERITOR, INC.	(212		)	2,779			476		(3,254		)	(211		)
NONCONTROLLING INTERESTS ⁽¹⁾	—			—			25		—			25
TOTAL LIABILITIES AND EQUITY (DEFICIT)	$	3,140		$	1,426		$	1,182	$	(3,254	)	$	2,494

⁽¹⁾ As of September 30, 2016, Assets and Liabilities held for sale were: (i) $1 million Cash and cash equivalents; (ii) $8 million Receivables, trade and other, net; (iii) $1 million Inventories; (iv) $5 million Net property; (v) $5 million Accounts and notes payable; and (vi) $3 million Noncontrolling interests. These assets and liabilities held for sale are included in the Non-Guarantors column.

Schedule of condensed consolidating statement of cash flows



	Nine Months Ended June 30, 2017
	Parent			Guarantors			Non- Guarantors			Elims		Consolidated
CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES	$	(24	)	$	28		$	132		$	—	$	136
INVESTING ACTIVITIES
Capital expenditures	(8		)	(27		)	(17		)	—		(52		)
Net investing cash flows provided by discontinued operations	—			2			—			—		2
CASH USED FOR INVESTING ACTIVITIES	(8		)	(25		)	(17		)	—		(50		)
FINANCING ACTIVITIES
Debt issuance costs	(4		)	—			—			—		(4		)
Intercompany advances	96			—			(96		)	—		—
Other financing activities	—			(3		)	(9		)	—		(12		)
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES	92			(3		)	(105		)	—		(16		)
EFFECT OF CHANGES IN FOREIGN CURRENCY EXCHANGE RATES ON CASH AND CASH EQUIVALENTS	—			—			1			—		1
CHANGE IN CASH AND CASH EQUIVALENTS	60			—			11			—		71
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	90			4			66			—		160
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	150		$	4		$	77		$	—	$	231



	Nine Months Ended June 30, 2016
	Parent			Guarantors			Non- Guarantors			Elims		Consolidated
CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES	$	124		$	25		$	(5	)	$	—	$	144
INVESTING ACTIVITIES
Capital expenditures	(16		)	(29		)	(21		)	—		(66		)
Other investing activities	—			4			(1		)	—		3
Net investing cash flows provided by discontinued operations	—			1			3			—		4
CASH USED FOR INVESTING ACTIVITIES	(16		)	(24		)	(19		)	—		(59		)
FINANCING ACTIVITIES
Repayment of notes	(55		)	—			—			—		(55		)
Repurchase of common stock	(81		)	—			—			—		(81		)
Intercompany advances	(10		)	—			10			—		—
Other financing activities	—			(4		)	(11		)	—		(15		)
CASH USED FOR FINANCING ACTIVITIES	(146		)	(4		)	(1		)	—		(151		)
EFFECT OF CHANGES IN FOREIGN CURRENCY EXCHANGE RATES ON CASH AND CASH EQUIVALENTS	—			—			2			—		2
CHANGE IN CASH AND CASH EQUIVALENTS	(38		)	(3		)	(23		)	—		(64		)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	73			6			114			—		193
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	35		$	3		$	91		$	—	$	129