Financial Information by Segment (Tables)

9 Months Ended

Jun. 30, 2014

Segment Reporting [Abstract]

Financial Information by Reportable Segment

Financial information by reportable segment is as follows:

	Reinforcement Materials		Performance Materials		Advanced Technologies		Purification Solutions			Segment Total		Unallocated and Other(1)			Consolidated Total
	(Dollars in millions)
Three Months Ended June 30, 2014
Revenues from external customers(2)	$	534	$	243	$	47	$	78		$	902	$	38		$	940
Income (loss) from continuing operations before taxes(3)	$	61	$	41	$	14	$	(7	)	$	109	$	(29	)	$	80
Three Months Ended June 30, 2013
Revenues from external customers(2)	$	486	$	233	$	67	$	81		$	867	$	34		$	901
Income (loss) from continuing operations before taxes(3)	$	49	$	35	$	28	$	(1	)	$	111	$	(37	)	$	74
Nine Months Ended June 30, 2014
Revenues from external customers(2)	$	1,555	$	709	$	159	$	230		$	2,653	$	83		$	2,736
Income (loss) from continuing operations before taxes(3)	$	186	$	122	$	51	$	(20	)	$	339	$	(102	)	$	237
Nine Months Ended June 30, 2013
Revenues from external customers(2)	$	1,420	$	672	$	143		244		$	2,479	$	81		$	2,560
Income (loss) from continuing operations before taxes(3)	$	141	$	99	$	44		4		$	288	$	(134	)	$	154

⁽¹⁾  Unallocated and Other includes certain items and eliminations necessary to reflect management’s reporting of operating segment results. These items are reflective of the segment reporting presented to the Chief Operating Decision Maker.

⁽²⁾  Revenue from external customers that are categorized as Unallocated and Other reflects royalties, other operating revenues, external shipping and handling costs, the impact of unearned revenue, the removal of 100% of the sales of an equity method affiliate and discounting charges for certain Notes receivable. Details are provided in the table below:

	Three Months Ended June 30				Nine Months Ended June 30
	2014		2013		2014			2013
	(Dollars in millions)
Royalties, other operating revenues, the impact of unearned revenue, the removal of 100% of the sales of an equity method affiliate and discounting charges for certain Notes receivable.	$	10	$	9	$	(2	)	$	6
Shipping and handling fees		28		25		85			75
Total	$	38	$	34	$	83		$	81

⁽³⁾  Income (loss) from continuing operations before taxes that are categorized as Unallocated and Other includes:

	Three Months Ended June 30						Nine Months Ended June 30
	2014			2013			2014			2013
	(Dollars in millions)
Interest expense	$	(14	)	$	(15	)	$	(41	)	$	(47	)
Total certain items, pre-tax(a)		(7	)		(4	)		(19	)		(43	)
Less: Equity in loss (earnings) of affiliated companies, net of tax(b)		2			(3	)		2			(9	)
Unallocated corporate costs(c)		(14	)		(12	)		(43	)		(37	)
General unallocated income (expense)(d)		4			(3	)		(1	)		2
Total	$	(29	)	$	(37	)	$	(102	)	$	(134	)

(a) Certain items are items that management does not consider to be representative of operating segment results and they are, therefore, excluded from Segment EBIT. Certain items, pre-tax, for the three months ended June 30, 2014 include $3 million related to global restructuring activities, $3 million of foreign currency loss on revaluations and $1 million related to legal and environmental matters and reserves. Certain items, pre-tax, for the nine months ended June 30, 2014 include $24 million related to global restructuring activities, $5 million for acquisition and integration-related charges (consisting of $3 million for certain other one-time integration costs and $2 million of additional charges related to acquisition accounting adjustments for the acquired inventory of NHUMO), $3 million of foreign currency loss on revaluations and $16 million for legal and environmental matters and reserves offset by a $29 million non-cash gain recognized on the Company’s pre-existing investment in NHUMO as a result of the NHUMO transaction. Certain items, pre-tax, for the three months ended June 30, 2013 include $5 million related to global restructuring activities and $2 million for acquisition and integration-related charges offset by $3 million of foreign currency gain on revaluation. Certain items, pre-tax, for the nine months ended June 30, 2013 include $29 million related to global restructuring activities and $18 million for acquisition and integration-related charges (consisting of $7 million for certain other one-time integration costs and $11 million of charges related to acquisition accounting adjustments for the acquired inventory) offset by $4 million of foreign currency gain on revaluation.

(b) Equity in loss (earnings) of affiliated companies, net of tax, is included in Segment EBIT and is removed from Unallocated and other to reconcile to income (loss) from continuing operations before taxes.

(c) Unallocated corporate costs are not controlled by the operating segments and primarily benefit corporate interests.

(d) General unallocated income (expense) consists of gains (losses) arising from foreign currency transactions, net of other foreign currency risk management activities, the impact of accounting for certain inventory on a LIFO basis, the profit or loss related to the corporate adjustment for unearned revenue, and the impact of including the full operating results of an equity affiliate in Purification Solutions Segment EBIT.

Schedule of Performance Segment

The net sales from each of these businesses for the three and nine months ended June 30, 2014 and 2013 are as follows:

	Three Months Ended June 30				Nine Months Ended June 30
	2014		2013		2014		2013
	(Dollars in millions)
Specialty Carbons and Compounds	$	165	$	159	$	485	$	464
Fumed Metal Oxides		78		74		224		208
Total Performance Materials	$	243	$	233	$	709	$	672

Schedule of Advanced Technologies Business Segment

The net sales from each of the Advanced Technologies businesses are as follows:

	Three Months Ended June 30				Nine Months Ended June 30
	2014		2013		2014		2013
	(Dollars in millions)
Inkjet Colorants	$	17	$	18	$	46	$	46
Aerogel		2		9		8		17
Elastomer Composites		4		5		28		17
Specialty Fluids		24		35		77		63
Total Advanced Technologies	$	47	$	67	$	159	$	143