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Financial Information by Segment (Tables)
 9 Months Ended
Jun. 30, 2019
Segment Reporting [Abstract]  
Schedule of Performance Segment The net sales from each of these businesses for the three and nine months ended June 30, 2019 and 2018 were as follows:

 

 

Three Months Ended June 30

 

 

Nine Months Ended June 30

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

 

 

(In millions)

 

Performance Additives

 

$

172

 

 

$

188

 

 

$

518

 

 

$

524

 

Formulated Solutions

 

 

79

 

 

 

86

 

 

 

218

 

 

 

247

 

Performance Chemicals

 

$

251

 

 

$

274

 

 

$

736

 

 

$

771

 

 
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 June 30, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers(2)

 

$

461

 

 

$

251

 

 

$

73

 

 

$

13

 

 

$

798

 

 

$

47

 

 

$

845

 

Income (loss) from continuing operations

   before income taxes(3)

 

$

72

 

 

$

37

 

 

$

1

 

 

$

2

 

 

$

112

 

 

$

(43

)

 

$

69

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers(2)

 

$

466

 

 

$

274

 

 

$

70

 

 

$

12

 

 

$

822

 

 

$

32

 

 

$

854

 

Income (loss) from continuing operations

   before income taxes(3)

 

$

74

 

 

$

56

 

 

$

(6

)

 

$

3

 

 

$

127

 

 

$

(32

)

 

$

95

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended June 30, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers(2)

 

$

1,363

 

 

$

736

 

 

$

210

 

 

$

56

 

 

$

2,365

 

 

$

145

 

 

$

2,510

 

Income (loss) from continuing operations

   before income taxes(3)

 

$

195

 

 

$

111

 

 

$

(1

)

 

$

24

 

 

$

329

 

 

$

(141

)

 

$

188

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended June 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers(2)

 

$

1,307

 

 

$

771

 

 

$

206

 

 

$

24

 

 

$

2,308

 

 

$

84

 

 

$

2,392

 

Income (loss) from continuing operations

   before income taxes(3)

 

$

215

 

 

$

160

 

 

$

(6

)

 

$

(2

)

 

$

367

 

 

$

(351

)

 

$

16

 

 

(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 June 30

 

 

Nine Months Ended June 30

 

 

 

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

)

 

$

(2

)

 

$

(9

)

 

$

(10

)

Shipping and handling fees

 

 

32

 

 

 

34

 

 

 

96

 

 

 

94

 

By-product sales(a)

 

 

18

 

 

 

—

 

 

 

58

 

 

 

—

 

Total

 

$

47

 

 

$

32

 

 

$

145

 

 

$

84

 

 

 

(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 June 30

 

 

Nine Months Ended June 30

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

 

 

(In millions)

 

Interest expense

 

$

(14

)

 

$

(14

)

 

$

(43

)

 

$

(41

)

Certain items(a)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Specialty Fluids loss on sale and asset impairment

   charge (Note D)

 

 

(8

)

 

 

—

 

 

 

(28

)

 

 

—

 

Equity affiliate investment impairment charge (Note O)

 

 

—

 

 

 

—

 

 

 

(11

)

 

 

—

 

Purification Solutions goodwill and long-lived

   assets impairment charge (Note F)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(254

)

Inventory reserve adjustment (Note F)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(13

)

Global restructuring activities (Note L)

 

 

(4

)

 

 

(1

)

 

 

(15

)

 

 

7

 

Legal and environmental matters and reserves

 

 

—

 

 

 

—

 

 

 

(1

)

 

 

(6

)

Gains (losses) on sale of investments

 

 

—

 

 

 

—

 

 

 

—

 

 

 

10

 

Acquisition and integration-related charges

 

 

(1

)

 

 

—

 

 

 

(5

)

 

 

(1

)

Other

 

 

(1

)

 

 

(2

)

 

 

(1

)

 

 

(3

)

Total certain items, pre-tax

 

 

(14

)

 

 

(3

)

 

 

(61

)

 

 

(260

)

Unallocated corporate costs(b)

 

 

(14

)

 

 

(15

)

 

 

(39

)

 

 

(45

)

General unallocated income (expense)(c)

 

 

—

 

 

 

—

 

 

 

3

 

 

 

(3

)

Less: Equity in earnings of affiliated companies, net

   of tax(d)

 

 

1

 

 

 

—

 

 

 

1

 

 

 

2

 

Total

 

$

(43

)

 

$

(32

)

 

$

(141

)

 

$

(351

)

 

 

(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 June 30, 2019

 

 

 

Reinforcement

Materials

 

 

Performance

Chemicals

 

 

Purification

Solutions

 

 

Specialty

Fluids

 

 

Consolidated Total

 

 

 

(In millions)

 

Americas

 

$

179

 

 

$

69

 

 

$

33

 

 

$

2

 

 

$

283

 

Asia Pacific

 

 

191

 

 

 

93

 

 

 

10

 

 

 

—

 

 

 

294

 

Europe, Middle East and Africa

 

 

91

 

 

 

89

 

 

 

30

 

 

 

11

 

 

 

221

 

Segment revenues from external customers

 

 

461

 

 

 

251

 

 

 

73

 

 

 

13

 

 

 

798

 

Unallocated and other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

47

 

Net sales and other operating revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

845

 

 

 

 

Nine Months Ended June 30, 2019

 

 

 

Reinforcement

Materials

 

 

Performance

Chemicals

 

 

Purification

Solutions

 

 

Specialty

Fluids

 

 

Consolidated Total

 

 

 

(In millions)

 

Americas

 

$

515

 

 

$

222

 

 

$

93

 

 

$

6

 

 

$

836

 

Asia Pacific

 

 

573

 

 

 

253

 

 

 

26

 

 

 

1

 

 

 

853

 

Europe, Middle East and Africa

 

 

275

 

 

 

261

 

 

 

91

 

 

 

49

 

 

 

676

 

Segment revenues from external customers

 

 

1,363

 

 

 

736

 

 

 

210

 

 

 

56

 

 

 

2,365

 

Unallocated and other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

145

 

Net sales and other operating revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

2,510