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Financial Information by Segment (Tables)
 6 Months Ended
Mar. 31, 2019
Segment Reporting [Abstract]  
Schedule of Performance Segment The net sales from each of these businesses for the three and six months ended March 31, 2019 and 2018 were as follows:

 

 

Three Months Ended March 31

 

 

Six Months Ended March 31

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

 

 

(In millions)

 

Performance Additives

 

$

179

 

 

$

177

 

 

$

346

 

 

$

336

 

Formulated Solutions

 

 

75

 

 

 

91

 

 

 

139

 

 

 

161

 

Performance Chemicals

 

$

254

 

 

$

268

 

 

$

485

 

 

$

497

 

 
Financial Information by Reportable Segment

Financial information by reportable segment is as follows:

 

 

 

Reinforcement

Materials

 

 

Performance

Chemicals

 

 

Purification

Solutions

 

 

Specialty

Fluids

 

 

Segment

Total

 

 

Unallocated

and Other(1)

 

 

Consolidated

Total

 

 

 

(In millions)

 

Three Months Ended March 31, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers(2)

 

$

445

 

 

$

254

 

 

$

72

 

 

$

24

 

 

$

795

 

 

$

49

 

 

$

844

 

Income (loss) from continuing operations

   before income taxes(3)

 

$

61

 

 

$

38

 

 

$

1

 

 

$

12

 

 

$

112

 

 

$

(63

)

 

$

49

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended March 31, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers(2)

 

$

454

 

 

$

268

 

 

$

66

 

 

$

6

 

 

$

794

 

 

$

24

 

 

$

818

 

Income (loss) from continuing operations

   before income taxes(3)

 

$

79

 

 

$

57

 

 

$

(6

)

 

$

(3

)

 

$

127

 

 

$

(298

)

 

$

(171

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended March 31, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers(2)

 

$

902

 

 

$

485

 

 

$

137

 

 

$

43

 

 

$

1,567

 

 

$

98

 

 

$

1,665

 

Income (loss) from continuing operations

   before income taxes(3)

 

$

123

 

 

$

74

 

 

$

(2

)

 

$

22

 

 

$

217

 

 

$

(98

)

 

$

119

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended March 31, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers(2)

 

$

841

 

 

$

497

 

 

$

136

 

 

$

12

 

 

$

1,486

 

 

$

52

 

 

$

1,538

 

Income (loss) from continuing operations

   before income taxes(3)

 

$

141

 

 

$

104

 

 

$

—

 

 

$

(5

)

 

$

240

 

 

$

(319

)

 

$

(79

)

 

(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 CODM.

(2)

Consolidated Total Revenues from external customers reconciles to Net sales and other operating revenues on the Consolidated Statements of Operations. Revenues from external customers that are categorized as Unallocated and Other reflects royalties, external shipping and handling fees, the impact of unearned revenue, the removal of 100% of the sales of an equity method affiliate, discounting charges for certain Notes receivable, and by-product revenue. Details are provided in the table below:

 

 

 

Three Months Ended March 31

 

 

Six Months Ended March 31

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

 

 

(In millions)

 

Royalties, the impact of unearned revenue, the

   removal of 100% of the sales of an equity method

   affiliate and discounting charges for certain notes

   receivable

 

$

(3

)

 

$

(9

)

 

$

(6

)

 

$

(8

)

Shipping and handling fees

 

 

32

 

 

 

33

 

 

 

64

 

 

 

60

 

By-product sales(a)

 

 

20

 

 

 

—

 

 

 

40

 

 

 

—

 

Total

 

$

49

 

 

$

24

 

 

$

98

 

 

$

52

 

 

 

(a)

As of October 1, 2018, as part of the adoption of the new accounting standard, Revenue from Contracts with Customers, the Company began presenting revenue from by-products produced in manufacturing operations in Net sales and other operating revenues, which in prior years was included as a reduction in Cost of sales.

(3)

Consolidated Total Income (loss) from continuing operations before income taxes reconciles to Income (loss) from continuing operations before income taxes and equity in earnings of affiliated companies on the Consolidated Statements of Operations. Income (loss) from continuing operations before income taxes that are categorized as Unallocated and Other includes:

 

 

Three Months Ended March 31

 

 

Six Months Ended March 31

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

 

 

(In millions)

 

Interest expense

 

$

(14

)

 

$

(14

)

 

$

(29

)

 

$

(27

)

Certain items(a)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Specialty Fluids held for sale asset impairment

   charge (Note D)

 

 

(20

)

 

 

—

 

 

 

(20

)

 

 

—

 

Equity affiliate investment impairment charge (Note O)

 

 

(11

)

 

 

—

 

 

 

(11

)

 

 

—

 

Purification Solutions goodwill and long-lived

   assets impairment charge (Note F)

 

 

—

 

 

 

(254

)

 

 

—

 

 

 

(254

)

Inventory reserve adjustment (Note F)

 

 

—

 

 

 

(13

)

 

 

—

 

 

 

(13

)

Global restructuring activities (Note L)

 

 

(2

)

 

 

9

 

 

 

(11

)

 

 

8

 

Legal and environmental matters and reserves

 

 

(1

)

 

 

(5

)

 

 

(1

)

 

 

(6

)

Gains (losses) on sale of investments

 

 

—

 

 

 

—

 

 

 

—

 

 

 

10

 

Acquisition and integration-related charges

 

 

(1

)

 

 

(1

)

 

 

(4

)

 

 

(1

)

Other

 

 

(2

)

 

 

—

 

 

 

—

 

 

 

(1

)

Total certain items, pre-tax

 

 

(37

)

 

 

(264

)

 

 

(47

)

 

 

(257

)

Unallocated corporate costs(b)

 

 

(13

)

 

 

(16

)

 

 

(25

)

 

 

(30

)

General unallocated income (expense)(c)

 

 

1

 

 

 

(3

)

 

 

3

 

 

 

(3

)

Less: Equity in earnings of affiliated companies, net

   of tax(d)

 

 

—

 

 

 

1

 

 

 

—

 

 

 

2

 

Total

 

$

(63

)

 

$

(298

)

 

$

(98

)

 

$

(319

)

 

 

(a)

Certain items are items of expense and income that management does not consider representative of the Company’s fundamental on-going segment results and they are, therefore, excluded from Segment EBIT.

 

(b)

Unallocated corporate costs are costs that are not controlled by the segments and primarily benefit corporate interests.

 

(c)

General unallocated income (expense) consists of gains (losses) arising from foreign currency transactions, net of other foreign currency risk management activities, the profit or loss related to the corporate adjustment for unearned revenue, and the impact of including the full operating results of a contractual joint venture in Purification Solutions Segment EBIT.

 

(d)

Equity in earnings of affiliated companies, net of tax, is included in Segment EBIT and is removed in Unallocated and other to reconcile to Income (loss) from operations before income taxes and equity in earnings from affiliated companies.
Revenues from External Customers by Geographic Region

The Company’s segments operate globally. In addition to presenting Revenue from external customers by reportable segment, the following tables further disaggregate Revenue from external customers by geographic region.

 

 

 

Three Months Ended March 31, 2019

 

 

 

Reinforcement

Materials

 

 

Performance

Chemicals

 

 

Purification

Solutions

 

 

Specialty

Fluids

 

 

Consolidated Total

 

 

 

(In millions)

 

Americas

 

$

169

 

 

$

81

 

 

$

31

 

 

$

2

 

 

$

283

 

Asia Pacific

 

 

180

 

 

 

75

 

 

 

7

 

 

 

—

 

 

 

262

 

Europe, Middle East and Africa

 

 

96

 

 

 

98

 

 

 

34

 

 

 

22

 

 

 

250

 

Segment revenues from external customers

 

 

445

 

 

 

254

 

 

 

72

 

 

 

24

 

 

 

795

 

Unallocated and other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

49

 

Net sales and other operating revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

844

 

 

 

 

Six Months Ended March 31, 2019

 

 

 

Reinforcement

Materials

 

 

Performance

Chemicals

 

 

Purification

Solutions

 

 

Specialty

Fluids

 

 

Consolidated Total

 

 

 

(In millions)

 

Americas

 

$

336

 

 

$

153

 

 

$

60

 

 

$

4

 

 

$

553

 

Asia Pacific

 

 

382

 

 

 

160

 

 

 

16

 

 

 

1

 

 

 

559

 

Europe, Middle East and Africa

 

 

184

 

 

 

172

 

 

 

61

 

 

 

38

 

 

 

455

 

Segment revenues from external customers

 

 

902

 

 

 

485

 

 

 

137

 

 

 

43

 

 

 

1,567

 

Unallocated and other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

98

 

Net sales and other operating revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

1,665