EX-99.1 2 ex991.htm EXHIBIT 99.1 -- 5-YEAR SUPPLEMENTAL FINANCIAL INFORMATION POSTED TO ASHLAND INC.'S WEBSITE ex991.htm
EXHIBIT 99.1
 
Ashland Inc. and Consolidated Subsidiaries
                            
Statements of Consolidated Income
                            
Years Ended September 30
                            
                             
(In millions except per share data)
2008
    
2007
    
2006
    
2005
    
2004
  
Sales and operating revenues
 $ 8,381     $ 7,785     $ 7,233     $ 6,731     $ 5,776  
Costs and expenses
                                      
Cost of sales and operating expenses
   7,056       6,447       6,030       5,545       4,721  
Selling, general and administrative expenses
   1,166       1,171       1,077       1,079       968  
    8,222       7,618       7,107       6,624       5,689  
Equity and other income
   54       49       44       564       438  
Operating income
   213       216       170       671       525  
Gain (loss) on the MAP Transaction (a)
   20       (3 )     (5 )     1,284       -  
Loss on early retirement of debt
   -       -       -       (145 )     -  
Net interest and other financing income (costs)
   28       46       47       (82 )     (114 )
Income from continuing operations before income taxes
   261       259       212       1,728       411  
Income tax (expense) benefit
   (86 )     (58 )     (29 )     230       (100 )
Income from continuing operations
   175       201       183       1,958       311  
Income (loss) from discontinued operations (net of income taxes)
   (8 )     29       224       46       67  
Net income
 $ 167     $ 230     $ 407     $ 2,004     $ 378  
                                       
Earnings per share
                                      
Basic
                                      
Income from continuing operations
 $ 2.78     $ 3.20     $ 2.57     $ 26.85     $ 4.44  
Income (loss) from discontinued operations
   (.13 )     .46       3.16       .64       .97  
Net income
 $ 2.65     $ 3.66     $ 5.73     $ 27.49     $ 5.41  
Diluted                                       
Income from continuing operations
 $ 2.76     $ 3.15     $ 2.53     $ 26.23     $ 4.36  
Income (loss) from discontinued operations
   (.13 )     .45       3.11       .62       .95  
Net income
 $ 2.63     $ 3.60     $ 5.64     $ 26.85     $ 5.31  
                                       
 
(a)
“MAP Transaction” refers to the June 30, 2005 transfer of Ashland’s 38% interest in Marathon Ashland Petroleum LLC (MAP), Ashland's maleic anhydride business and 60 Valvoline Instant Oil Change centers in Michigan and northwest Ohio to Marathon Oil Corporation in a transaction valued at approximately $3.7 billion.
  
 
 
 
 
 
 
 
Ashland Inc. and Consolidated Subsidiaries
                            
Consolidated Balance Sheets
                            
September 30
                            
                             
(In millions)
2008
    
2007
    
2006
    
2005
    
2004
  
Assets
                                
Current assets
                                
Cash and cash equivalents
 $ 886     $ 897     $ 1,820     $ 985     $ 243  
Available-for-sale securities
   -       155       349       403       -  
Accounts receivable
   1,469       1,467       1,401       1,242       953  
Inventories
   494       610       532       439       383  
Deferred income taxes
   97       69       93       104       96  
Other current assets
   86       78       55       22       111  
Current assets of discontinued operations
   -       -       -       562       516  
    3,032       3,276       4,250       3,757       2,302  
Investments and other assets
                                      
Investment in Marathon Ashland Petroleum LLC (MAP)
   -       -       -       -       2,713  
Auction rate securities
   243       -       -       -       -  
Goodwill and other intangibles
   408       377       310       235       116  
Asbestos insurance receivable (noncurrent portion)
   428       458       444       370       399  
Deferred income taxes
   154       157       186       228       -  
Other noncurrent assets
   394       435       450       419       286  
Noncurrent assets of discontinued operations
   -       -       -       976       909  
    1,627       1,427       1,390       2,228       4,423  
Property, plant and equipment
                                      
Cost
                                      
Performance Materials
   756       701       637       573       613  
Distribution
   436       434       407       378       355  
Valvoline
   502       488       489       488       466  
Water Technologies
   244       272       255       184       167  
Unallocated and other
   359       230       219       207       201  
    2,297       2,125       2,007       1,830       1,802  
Accumulated depreciation and amortization
   (1,185 )     (1,142 )     (1,057 )     (1,000 )     (1,025 )
    1,112       983       950       830       777  
  $ 5,771     $ 5,686     $ 6,590     $ 6,815     $ 7,502  
                                       
Liabilities and Stockholders’ Equity
                                      
Current liabilities
                                      
Debt due within one year
                                      
         Short-term debt $  -     $   -     $   -     $   -     $   40  
 Current portion of long-term debt
   21       5       12       12       399  
Dividends payable
   -       -       674       -       -  
Trade and other payables
   1,209       1,141       1,302       1,239       1,106  
Income taxes
   -       6       53       13       14  
Current liabilities of discontinued operations
   -       -       -       281       256  
    1,230       1,152       2,041       1,545       1,815  
Noncurrent liabilities
                                      
Long-term debt (noncurrent portion)
   45       64       70       82       1,109  
Employee benefit obligations
   344       255       313       358       428  
Deferred income taxes
   -       -       -       -       286  
Asbestos litigation reserve (noncurrent portion)
   522       560       585       521       568  
Other noncurrent liabilities
   428       501       485       482       429  
Noncurrent liabilities of discontinued operations
   -       -       -       88       161  
    1,339       1,380       1,453       1,531       2,981  
Stockholders’ equity
                                      
Common stock
   1       1       1       1       72  
Paid-in capital
   33       16       240       605       478  
Retained earnings
   3,138       3,040       2,899       3,251       2,262  
Accumulated other comprehensive income (loss)
   30       97       (44 )     (118 )     (106 )
    3,202       3,154       3,096       3,739       2,706  
  $ 5,771     $ 5,686     $ 6,590     $ 6,815     $ 7,502  
 
 
 
 
 
 
 
 
Ashland Inc. and Consolidated Subsidiaries
                            
Statements of Consolidated Cash Flows
                            
Years Ended September 30
                            
                             
(In millions)
2008
    
2007
    
2006
    
2005
    
2004
  
Cash flows from operating activities from continuing operations
                                
Net income
 $ 167     $ 230     $ 407     $ 2,004     $ 378  
Loss (income) from discontinued operations (net of income taxes)
   8       (29 )     (224 )     (46 )     (67 )
Adjustments to reconcile income from continuing operations
                                      
to cash flows from operating activities
                                      
  Depreciation and amortization   145       133       111       100       98  
  Deferred income taxes   44       22       (1 )     (500 )     104  
  Equity income from affiliates   (23 )     (15 )     (11 )     (525 )     (412 )
  Distributions from equity affiliates   13       10       5       279       152  
  Gain from the sale of property and equipment   (2 )     (4 )     (1 )     (9 )     (8 )
  Stock based compensation expense   12       16       25       25       15  
  (Gain) loss on the MAP Transaction   (20 )     3       5       (1,284 )     -  
  Loss on early retirement of debt   -       -       -       145       -  
  Change in operating assets and liabilities (a)   134       (177 )     (168 )     (260 )     (227 )
  Other items   -       -       (3 )     (5 )     -  
    478       189       145       (76 )     33  
                                       
Cash flows from investing activities from continuing operations
                                      
Additions to property, plant and equipment
   (205 )     (154 )     (175 )     (180 )     (137 )
Proceeds from the disposal of property, plant and equipment
   10       27       21       18       31  
Purchase of operations - net of cash acquired
   (129 )     (75 )     (183 )     (135 )     (5 )
Proceeds from sale of operations
   26       -       -       3,303       -  
Purchases of available-for-sale securities
   (435 )     (484 )     (824 )     (402 )     -  
Proceeds from sales and maturities of
                                      
available-for-sale securities
   315       680       876       1       -  
Purchase of accounts receivable
   -       -       -       (150 )     -  
Collections of accounts receivable purchased
   -       -       -       150       -  
    (418 )     (6 )     (285 )     2,605       (111 )
                                       
Cash flows from financing activities from continuing operations
                                      
Proceeds from the exercise of stock options
   3       19       18       115       108  
Excess tax benefits related to share-based payments
   1       9       6       20       3  
Repayment of long-term debt
   (5 )     (13 )     (13 )     (1,552 )     (100 )
Repurchase of common stock
   -       (288 )     (405 )     (100 )     -  
(Decrease) increase in revolving credit facility
   -       -       -       (40 )     40  
Cash dividends paid
   (69 )     (743 )     (78 )     (79 )     (77 )
    (70 )     (1,016 )     (472 )     (1,636 )     (26 )
Cash (used) provided by continuing operations
   (10 )     (833 )     (612 )     893       (104 )
Cash (used) provided by discontinued operations
                                      
 
Operating cash flows
   (8 )     (3 )     197       53       143  
 
Investing cash flows
   -       (92 )     1,248       (207 )     (21 )
    (8 )     (95 )     1,445       (154 )     122  
Effect of currency exchange rate changes on cash and cash equivalents
   7       5       2       3       2  
(Decrease) increase in cash and cash equivalents
   (11 )     (923 )     835       742       20  
Cash and cash equivalents - beginning of year
   897       1,820       985       243       223  
Cash and cash equivalents - end of year
 $ 886     $ 897     $ 1,820     $ 985     $ 243  
                                       
(Increase) decrease in operating assets (a)
                                      
Accounts receivable
 $ 10     $ (56 )   $ (77 )   $ (292 )   $ (150 )
Inventories
   126       (75 )     (56 )     (73 )     (9 )
Other current assets
   (53 )     (22 )     21       94       (60 )
Investments and other assets
   78       90       (2 )     (247 )     (15 )
Increase (decrease) in operating liabilities (a)
                                      
Trade and other payables
   57       (103 )     41       105       (4 )
Other current liabilities
   (7 )     (20 )     (90 )     (27 )     (11 )
Pension contributions
   (25 )     (58 )     (111 )     (121 )     (137 )
Noncurrent liabilities
   (52 )     67       106       301       159  
Change in operating assets and liabilities
 $ 134     $ (177 )   $ (168 )   $ (260 )   $ (227 )
                                       
(a)
Excludes changes resulting from operations acquired or sold.
              
 
 
 
 
 
 
 
Ashland Inc. and Consolidated Subsidiaries
                            
Information by Industry Segment
                            
Years Ended September 30
                            
                             
(In millions)
 2008       2007      2006      2005      2004  
Sales and operating revenues
                            
Performance Materials
 $ 1,621     $ 1,580     $ 1,425     $ 1,369     $ 1,026  
Distribution
   4,374       4,031       4,070       3,810       3,199  
Valvoline
   1,662       1,525       1,409       1,326       1,297  
Water Technologies
   893       818       502       394       360  
Intersegment sales (a)
                                      
    Performance Materials   (151 )     (154 )     (145 )     (143 )     (85 )
   
Distribution
   (12 )      (12 )      (23 )      (22 )      (19 ) 
    Valvoline    (6 )     (1 )       (3 )      (2 )      (1 ) 
    Water Technologies    -       (2 )       (2 )      (1 )      (1 ) 
  $ 8,381     $ 7,785     $ 7,233     $ 6,731     $ 5,776  
                                       
Equity income
                                      
Performance Materials
 $ 16     $ 10     $ 10     $ 7     $ 7  
Valvoline
   5       4       1       1       -  
Water Technologies
   1       1       -       -       -  
Refining and Marketing
   -       -       -       517       405  
Unallocated and other
   1       -       -       -       -  
    23       15       11       525       412  
                                       
Other income
                                      
Performance Materials
   3       4       4       17       8  
Distribution
   3       3       4       7       9  
Valvoline
   7       8       7       6       4  
Water Technologies
   2       3       4       4       8  
Refining and Marketing
   -       -       -       3       (6 )
Unallocated and other
   16       16       14       2       3  
    31       34       33       39       26  
  $ 54     $ 49     $ 44     $ 564     $ 438  
                                       
Operating income
                                      
Performance Materials
 $ 52     $ 89     $ 112     $ 88     $ 42  
Distribution
   51       41       120       99       56  
Valvoline    83       86       (21 )     59       77  
Water Technologies
   10       16       14       11       14  
Refining and Marketing (b)
   -       -       -       486       383  
Unallocated and other
   17       (16 )     (55 )     (72 )     (47 )
  $ 213     $ 216     $ 170     $ 671     $ 525  
                                       
Depreciation and amortization
                                      
Performance Materials
 $ 42     $ 36     $ 31     $ 31     $ 30  
Distribution
   24       22       21       18       18  
Valvoline   32       31       28       27       27  
Water Technologies
   26       27       17       13       11  
Unallocated and other
   21       17       14       11       12  
  $ 145     $ 133     $ 111     $ 100     $ 98  
                                       
 
(a)
Intersegment sales are accounted for at prices that approximate market value.
(b) 
Includes Ashland's equity income from MAP through June 30, 2005, amortization related to Ashland's excess investment in MAP, and other activities associated with refining and marketing.
  
 
 
 
 
 
 
 
 
Ashland Inc. and Consolidated Subsidiaries
                            
Information by Industry Segment
                            
Years Ended September 30
                            
                             
(In millions)
2008
    
2007
    
2006
    
2005
    
2004
  
Assets
                            
Performance Materials
 $ 1,080     $ 997     $ 841     $ 764     $ 640  
Distribution
   1,090       1,218       1,148       1,057       922  
Valvoline
   750       751       742       723       658  
Water Technologies
   495       514       468       233       202  
Refining and Marketing
   -       -       -       -       2,742  
Discontinued operations
   -       -       -       1,569       1,428  
Unallocated and other (a)
   2,356       2,206       3,391       2,469       910  
  $ 5,771     $ 5,686     $ 6,590     $ 6,815     $ 7,502  
Capital employed
                                      
Performance Materials
 $ 795     $ 682     $ 505     $ 466     $ 373  
Distribution
   521       672       564       513       449  
Valvoline
   485       501       489       483       388  
Water Technologies
   333       359       322       146       116  
                                       
Return on investment (b)                                       
Performance Materials   4.6 %      9.2 %      15.9 %       10.8 %  (c)   8.0 % 
Distribution    5.8 %       4.1 %       13.5 %       12.0 %       7.7 % 
Valvoline     11.7 %       10.2 %       (2.6 )%       9.0 %  (c)     11.5 % 
Water Technologies     1.8 %       4.9 %       6.4 %       7.6 %       9.0 % 
                                       
Additions to property, plant and equipment
                                      
Performance Materials
 $ 48     $ 56     $ 58     $ 45     $ 45  
Distribution
   27       29       36       26       10  
Valvoline
   42       28       38       66       26  
Water Technologies
   17       24       23       19       17  
Unallocated and other
   71       17       20       24       39  
  $ 205     $ 154     $ 175     $ 180     $ 137  
 
(a)
Includes cash, cash equivalents, available-for-sale securities, property and other assets.
      
(b)
Calculated as income from continuing operations divided by average quarterly capital employed.
      
(c)
On June 30, 2005, Ashland transferred its 38% interest in Marathon Ashland Petroleum LLC and two other businesses to Marathon Oil Corporation (the "MAP Transaction").  Amounts for 2005 exclude the respective portions of the net gain on the MAP Transaction of $43 million for Performance Materials and $24 million for Valvoline.  Including these amounts, the return on investment would have been 20.3% for Performance Materials and 14.4% for Valvoline.
 
 
 
Ashland Inc. and Consolidated Subsidiaries
                            
Information by Industry Segment
                            
Years Ended September 30
                            
                               
(In millions)
2008
    
2007
    
2006
    
2005
    
2004
  
Operating information
                            
Performance Materials (a) (b)
                            
 
Sales per shipping day
 $ 6.4     $ 6.1     $ 5.7     $ 5.4     $ 4.0  
 
Pounds sold per shipping day
   4.9       4.9       4.9       5.4       5.1  
  Gross profit as a percent of sales    17.0 %      20.5 %       22.5 %       20.4 %       20.4 % 
Distribution (a) (b)
                                      
 
Sales per shipping day
 $ 17.3     $ 15.9     $ 16.2     $ 15.1     $ 12.6  
 
Pounds sold per shipping day
   18.8       19.6       20.3       21.0       21.0  
  Gross profit as a percent of sales     7.8 %       7.9 %       9.5 %       9.7 %       9.6 % 
Valvoline (a) (b)
                                      
 
Lubricant sales (gallons)
   169.2       167.1       168.7       175.4       191.6  
  Premium lubricants (percent of U.S. branded volumes)     24.9 %       23.3 %       23.1 %       23.4 %       21.5 % 
  Gross profit as a percent of sales     23.0 %       24.8 %       19.9 %       26.6 %       28.2 % 
Water Technologies (a) (b)
                                      
 
Sales per shipping day
 $ 3.5     $ 3.1     $ 2.0     $ 1.6     $ 1.4  
  Gross profit as a percent of sales     36.7 %       39.2 %       43.7 %       47.8 %      49.3 % 
                                         
                                         
                                         
(a)
Sales are defined as sales and operating revenues. Gross profit is defined as sales and operating revenues, less cost of sales and operating expenses.
  
(b)
Excludes amounts resulting from the elimination of the previous one month financial reporting lag for wholly owned entities outside North America, which was recorded during fiscal 2007.
  
 
 
 
Ashland Inc. and Consolidated Subsidiaries
                            
International Operations
                            
Years Ended September 30
                            
                             
(In millions)
2008
    
2007
    
2006
    
2005
    
2004
  
International assets (a)
                            
Performance Materials
 $ 553     $ 535     $ 463     $ 396     $ 333  
Distribution
   265       319       264       216       184  
Valvoline
   186       186       158       146       132  
Water Technologies
   322       312       268       88       83  
    1,326       1,352       1,153       846       732  
International liabilities (a)
                                      
Performance Materials
   115       148       130       102       94  
Distribution
   120       103       127       94       88  
Valvoline
   57       51       44       42       54  
Water Technologies
   96       109       89       31       34  
    388       411       390       269       270  
Net international investment (a)
                                      
Performance Materials
   438       387       333       294       239  
Distribution
   145       216       137       122       96  
Valvoline
   129       135       114       104       78  
Water Technologies
   226       203       179       57       49  
  $ 938     $ 941     $ 763     $ 577     $ 462  
International income before income taxes (a) (b)
                                      
Performance Materials
 $ 68     $ 64     $ 68     $ 64     $ 43  
Distribution
   7       6       12       17       14  
Valvoline
   37       29       19       26       20  
Water Technologies
   61       62       41       37       30  
  $ 173     $ 161     $ 140     $ 144     $ 107  
International revenues (a) (c)
                                      
Performance Materials
 $ 861     $ 732     $ 608     $ 601     $ 387  
Distribution
   967       846       729       663       537  
Valvoline
   418       392       310       287       249  
Water Technologies
   661       545       309       229       202  
  $ 2,907     $ 2,515     $ 1,956     $ 1,780     $ 1,375  
 
(a)
Excludes amounts resulting from the elimination of the previous one month financial reporting lag for wholly owned entities outside North America, which was recorded during fiscal 2007.
(b)
Amounts represent income recorded by international subsidiaries, equity and dividend income from international affiliates, and international source royalty and other income recorded by U.S. subsidiaries.  Amounts do not reflect intercompany items eliminated in consolidation (e.g., interest) or any allocation of unallocated expenses incurred in the U.S. (e.g., research and development, advertising or administrative expenses) for the benefit of both U.S. and international operations.
(c)
Includes sales and operating revenues, equity income and other income.
 
 
 
 
 
 
 
Ashland Inc. and Consolidated Subsidiaries
                            
International Operations
                            
Years Ended September 30
                            
                             
(In millions)
2008
    
2007
    
2006
    
2005
    
2004
  
International assets (a)
                            
Europe
 $ 779     $ 842     $ 715     $ 499     $ 432  
Canada
   189       205       193       189       164  
Asia
   205       168       131       72       58  
Australia and New Zealand
   59       64       55       46       48  
Other
   94       73       59       40       30  
    1,326       1,352       1,153       846       732  
International liabilities (a)
                                      
Europe
   252       283       287       181       180  
Canada
   46       63       48       48       52  
Asia
   47       27       22       9       11  
Australia and New Zealand
   23       21       19       17       17  
Other
   20       17       14       14       10  
    388       411       390       269       270  
Net international investment (a)
                                      
Europe
   527       559       428       318       252  
Canada
   143       142       145       141       112  
Asia
   158       141       109       63       47  
Australia and New Zealand
   36       43       36       29       31  
Other
   74       56       45       26       20  
  $ 938     $ 941     $ 763     $ 577     $ 462  
International income before income taxes (a) (b)
                                      
Europe
 $ 69     $ 82     $ 67     $ 61     $ 41  
Canada
   19       13       29       40       32  
Asia
   31       29       18       14       14  
Australia and New Zealand
   17       11       6       10       11  
Other
   37       26       20       19       9  
  $ 173     $ 161     $ 140     $ 144     $ 107  
International revenues (a) (c)
                                      
Europe
 $ 1,745     $ 1,530     $ 1,118     $ 999     $ 757  
Canada
   431       405       421       422       344  
Asia
   312       231       143       114       87  
Australia and New Zealand
   159       142       107       105       95  
Other
   260       207       167       140       92  
  $ 2,907     $ 2,515     $ 1,956     $ 1,780     $ 1,375  
 
(a)
Excludes amounts resulting from the elimination of the previous one month financial reporting lag for wholly owned entities outside North America, which was recorded during fiscal 2007.
(b)
Amounts represent income recorded by international subsidiaries, equity and dividend income from international affiliates, and international source royalty and other income recorded by U.S. subsidiaries.  Amounts do not reflect intercompany items eliminated in consolidation (e.g., interest) or any allocation of unallocated expenses incurred in the U.S. (e.g., research and development, advertising or administrative expenses) for the benefit of both U.S. and international operations.
(c)
Includes sales and operating revenues, equity income and other income.