Guarantor Financial Information (Tables)

9 Months Ended

Jun. 30, 2019

Condensed Financial Information Disclosure [Abstract]

Condensed Consolidating Statements of Comprehensive Income

The following tables present, on a consolidating basis, the condensed statements of comprehensive income, condensed balance sheets, and condensed statements of cash flows for the parent issuer of these Senior Notes, the Guarantor Subsidiaries on a combined basis, the Non-Guarantor Subsidiaries on a combined basis, and the eliminations necessary to arrive at the Company’s consolidated results.

Condensed Consolidating Statements of Comprehensive Income
For the three months ended June 30, 2019
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	491	$	140	$	(18)	$	613
Cost of sales	—		324		100		(18)		406
Gross profit	—		167		40		—		207
Selling, general and administrative expenses	3		87		26		—		116
Net legacy and separation-related expenses	—		—		—		—		—
Equity and other (income) expenses, net	—		(16)		5		—		(11)
Operating (loss) income	(3)		96		9		—		102
Net pension and other postretirement plan income	—		(2)		—		—		(2)
Net interest and other financing expenses	17		2		—		—		19
(Loss) income before income taxes	(20)		96		9		—		85
Income tax (benefit) expense	(5)		24		1		—		20
Equity in net income of subsidiaries	(80)		(8)		—		88		—
Net income	$	65	$	80	$	8	$	(88)	$	65
Total comprehensive income	$	63	$	78	$	9	$	(87)	$	63

Condensed Consolidating Statements of Comprehensive Income
For the three months ended June 30, 2018
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	456	$	137	$	(16)	$	577
Cost of sales	—		294		98		(16)		376
Gross profit	—		162		39		—		201
Selling, general and administrative expenses	3		81		26		—		110
Net legacy and separation-related income	(3)		—		—		—		(3)
Equity and other (income) expenses, net	—		(11)		3		—		(8)
Operating income	—		92		10		—		102
Net pension and other postretirement plan income	—		(10)		—		—		(10)
Net interest and other financing expenses	14		1		—		—		15
(Loss) income before income taxes	(14)		101		10		—		97
Income tax (benefit) expense	(1)		30		4		—		33
Equity in net income of subsidiaries	(77)		(6)		—		83		—
Net income	$	64	$	77	$	6	$	(83)	$	64
Total comprehensive income	$	48	$	61	$	(5)	$	(56)	$	48

Condensed Consolidating Statements of Comprehensive Income
For the nine months ended June 30, 2019
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	1,396	$	415	$	(50)	$	1,761
Cost of sales	—		917		301		(50)		1,168
Gross profit	—		479		114		—		593
Selling, general and administrative expenses	8		258		68		—		334
Net legacy and separation-related expenses	3		—		—		—		3
Equity and other (income) expenses, net	—		(43)		14		—		(29)
Operating (loss) income	(11)		264		32		—		285
Net pension and other postretirement plan income	—		(7)		—		—		(7)
Net interest and other financing expenses	47		5		3		—		55
(Loss) income before income taxes	(58)		266		29		—		237
Income tax (benefit) expense	(16)		65		7		—		56
Equity in net income of subsidiaries	(223)		(22)		—		245		—
Net income	$	181	$	223	$	22	$	(245)	$	181
Total comprehensive income	$	173	$	215	$	20	$	(235)	$	173

Condensed Consolidating Statements of Comprehensive Income
For the nine months ended June 30, 2018
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	1,319	$	413	$	(41)	$	1,691
Cost of sales	—		832		297		(41)		1,088
Gross profit	—		487		116		—		603
Selling, general and administrative expenses	10		247		71		—		328
Net legacy and separation-related expenses	4		10		—		—		14
Equity and other (income) expenses, net	—		(37)		8		—		(29)
Operating (loss) income	(14)		267		37		—		290
Net pension and other postretirement plan income	—		(30)		—		—		(30)
Net interest and other financing expenses	39		4		2		—		45
(Loss) income before income taxes	(53)		293		35		—		275
Income tax expense	16		128		10		—		154
Equity in net income of subsidiaries	(190)		(25)		—		215		—
Net income	$	121	$	190	$	25	$	(215)	$	121
Total comprehensive income	$	105	$	174	$	17	$	(191)	$	105

Condensed Income Statement

The following tables present, on a consolidating basis, the condensed statements of comprehensive income, condensed balance sheets, and condensed statements of cash flows for the parent issuer of these Senior Notes, the Guarantor Subsidiaries on a combined basis, the Non-Guarantor Subsidiaries on a combined basis, and the eliminations necessary to arrive at the Company’s consolidated results.

Condensed Consolidating Statements of Comprehensive Income
For the three months ended June 30, 2019
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	491	$	140	$	(18)	$	613
Cost of sales	—		324		100		(18)		406
Gross profit	—		167		40		—		207
Selling, general and administrative expenses	3		87		26		—		116
Net legacy and separation-related expenses	—		—		—		—		—
Equity and other (income) expenses, net	—		(16)		5		—		(11)
Operating (loss) income	(3)		96		9		—		102
Net pension and other postretirement plan income	—		(2)		—		—		(2)
Net interest and other financing expenses	17		2		—		—		19
(Loss) income before income taxes	(20)		96		9		—		85
Income tax (benefit) expense	(5)		24		1		—		20
Equity in net income of subsidiaries	(80)		(8)		—		88		—
Net income	$	65	$	80	$	8	$	(88)	$	65
Total comprehensive income	$	63	$	78	$	9	$	(87)	$	63

Condensed Consolidating Statements of Comprehensive Income
For the three months ended June 30, 2018
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	456	$	137	$	(16)	$	577
Cost of sales	—		294		98		(16)		376
Gross profit	—		162		39		—		201
Selling, general and administrative expenses	3		81		26		—		110
Net legacy and separation-related income	(3)		—		—		—		(3)
Equity and other (income) expenses, net	—		(11)		3		—		(8)
Operating income	—		92		10		—		102
Net pension and other postretirement plan income	—		(10)		—		—		(10)
Net interest and other financing expenses	14		1		—		—		15
(Loss) income before income taxes	(14)		101		10		—		97
Income tax (benefit) expense	(1)		30		4		—		33
Equity in net income of subsidiaries	(77)		(6)		—		83		—
Net income	$	64	$	77	$	6	$	(83)	$	64
Total comprehensive income	$	48	$	61	$	(5)	$	(56)	$	48

Condensed Consolidating Statements of Comprehensive Income
For the nine months ended June 30, 2019
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	1,396	$	415	$	(50)	$	1,761
Cost of sales	—		917		301		(50)		1,168
Gross profit	—		479		114		—		593
Selling, general and administrative expenses	8		258		68		—		334
Net legacy and separation-related expenses	3		—		—		—		3
Equity and other (income) expenses, net	—		(43)		14		—		(29)
Operating (loss) income	(11)		264		32		—		285
Net pension and other postretirement plan income	—		(7)		—		—		(7)
Net interest and other financing expenses	47		5		3		—		55
(Loss) income before income taxes	(58)		266		29		—		237
Income tax (benefit) expense	(16)		65		7		—		56
Equity in net income of subsidiaries	(223)		(22)		—		245		—
Net income	$	181	$	223	$	22	$	(245)	$	181
Total comprehensive income	$	173	$	215	$	20	$	(235)	$	173

Condensed Consolidating Statements of Comprehensive Income
For the nine months ended June 30, 2018
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Sales	$	—	$	1,319	$	413	$	(41)	$	1,691
Cost of sales	—		832		297		(41)		1,088
Gross profit	—		487		116		—		603
Selling, general and administrative expenses	10		247		71		—		328
Net legacy and separation-related expenses	4		10		—		—		14
Equity and other (income) expenses, net	—		(37)		8		—		(29)
Operating (loss) income	(14)		267		37		—		290
Net pension and other postretirement plan income	—		(30)		—		—		(30)
Net interest and other financing expenses	39		4		2		—		45
(Loss) income before income taxes	(53)		293		35		—		275
Income tax expense	16		128		10		—		154
Equity in net income of subsidiaries	(190)		(25)		—		215		—
Net income	$	121	$	190	$	25	$	(215)	$	121
Total comprehensive income	$	105	$	174	$	17	$	(191)	$	105

Condensed Consolidating Balance Sheets

Condensed Consolidating Balance Sheets
As of June 30, 2019
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Assets
Current assets
Cash and cash equivalents	$	—	$	29	$	97	$	—	$	126
Accounts receivable, net	—		203		359		(139)		423
Inventories, net	—		117		83		—		200
Prepaid expenses and other current assets	1		29		22		—		52
Total current assets	1		378		561		(139)		801
Noncurrent assets
Property, plant and equipment, net	—		408		47		—		455
Goodwill and intangibles, net	—		418		72		—		490
Equity method investments	—		35		—		—		35
Investment in subsidiaries	1,158		553		—		(1,711)		—
Deferred income taxes	79		19		15		—		113
Other noncurrent assets	3		95		8		—		106
Total noncurrent assets	$	1,240	1,528		142		(1,711)		1,199
Total assets	$	1,241	$	1,906	$	703	$	(1,850)	$	2,000
Liabilities and Stockholders’ Deficit
Current liabilities
Current portion of long-term debt	$	7	$	—	$	—	$	—	$	7
Trade and other payables	97		107		98		(139)		163
Accrued expenses and other liabilities	20		188		34		—		242
Total current liabilities	124		295		132		(139)		412
Noncurrent liabilities
Long-term debt	1,333		1		—		—		1,334
Employee benefit obligations	—		305		17		—		322
Other noncurrent liabilities	36		147		1		—		184
Total noncurrent liabilities	1,369		453		18		—		1,840
Commitments and contingencies
Stockholders’ (deficit) equity	(252)		1,158		553		(1,711)		(252)
Total liabilities and stockholders’ deficit / equity	$	1,241	$	1,906	$	703	$	(1,850)	$	2,000

Condensed Consolidating Balance Sheets
As of September 30, 2018
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Assets
Current assets
Cash and cash equivalents	$	—	$	20	$	76	$	—	$	96
Accounts receivable, net	—		48		480		(119)		409
Inventories, net	—		95		81		—		176
Prepaid expenses and other current assets	1		38		5		—		44
Total current assets	1		201		642		(119)		725
Noncurrent assets
Property, plant and equipment, net	—		384		36		—		420
Goodwill and intangibles, net	—		396		52		—		448
Equity method investments	—		31		—		—		31
Investment in subsidiaries	801		509		—		(1,310)		—
Deferred income taxes	62		63		13		—		138
Other noncurrent assets	2		85		5		—		92
Total noncurrent assets	865		1,468		106		(1,310)		1,129
Total assets	$	866	$	1,669	$	748	$	(1,429)	$	1,854
Liabilities and Stockholders’ Deficit
Current liabilities
Current portion of long-term debt	$	30	$	—	$	—	$	—	$	30
Trade and other payables	3		241		53		(119)		178
Accrued expenses and other liabilities	7		168		28		—		203
Total current liabilities	40		409		81		(119)		411
Noncurrent liabilities
Long-term debt	1,151		1		140		—		1,292
Employee benefit obligations	—		317		16		—		333
Other noncurrent liabilities	33		141		2		—		176
Total noncurrent liabilities	1,184		459		158		—		1,801
Commitments and contingencies
Stockholders’ (deficit) equity	(358)		801		509		(1,310)		(358)
Total liabilities and stockholders’ deficit / equity	$	866	$	1,669	$	748	$	(1,429)	$	1,854

Condensed Consolidating Statements of Cash Flows

Condensed Consolidating Statements of Cash Flows
For the nine months ended June 30, 2019
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Cash flows (used in) provided by operating activities	$	(94)	$	98	$	210	$	—	$	214
Cash flows from investing activities
Additions to property, plant and equipment	—		(60)		(13)		—		(73)
Acquisitions, net of cash acquired	—		(28)		(22)		—		(50)
Other investing activities, net	—		1		(2)		—		(1)
Cash flows used in investing activities	—		(87)		(37)		—		(124)
Cash flows from financing activities
Proceeds from borrowings, net of issuance costs	661		—		82		—		743
Repayments on borrowings	(505)		—		(222)		—		(727)
Payments for purchase of additional ownership in subsidiary	—		—		(1)		—		(1)
Cash dividends paid	(60)		—		—		—		(60)
Other financing activities	(2)		(2)		—		—		(4)
Cash flows provided by (used in) financing activities	94		(2)		(141)		—		(49)
Effect of currency exchange rate changes on cash, cash equivalents, and restricted cash	—		—		—		—		—
Increase in cash, cash equivalents, and restricted cash	—		9		32		—		41
Cash, cash equivalents, and restricted cash - beginning of year	—		20		76		—		96
Cash, cash equivalents, and restricted cash - end of period	$	—	$	29	$	108	$	—	$	137

Condensed Consolidating Statements of Cash Flows
For the nine months ended June 30, 2018
(In millions)	Valvoline Inc. (Parent Issuer)		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Cash flows (used in) provided by operating activities	$	(28)	$	287	$	(78)	$	—	$	181
Cash flows from investing activities
Additions to property, plant and equipment	—		(48)		(3)		—		(51)
Acquisitions, net of cash acquired	—		(71)		—		—		(71)
Other investing activities, net	—		5		—		—		5
Return of advance from subsidiary	263		—		—		(263)		—
Cash flows provided by (used in) investing activities	263		(114)		(3)		(263)		(117)
Cash flows from financing activities
Proceeds from borrowings, net of issuance costs	70		—		100		—		170
Repayments on borrowings	(38)		—		(1)		—		(39)
Repurchases of common stock	(220)		—		—		—		(220)
Payments for purchase of additional ownership in subsidiary	—		—		(15)		—		(15)
Cash dividends paid	(45)		—		—		—		(45)
Other financing activities	(2)		(2)		(2)		—		(6)
Other intercompany activity, net	—		(263)		—		263		—
Total cash (used in) provided by financing activities	(235)		(265)		82		263		(155)
Effect of currency exchange rate changes on cash, cash equivalents, and restricted cash	—		—		(3)		—		(3)
Decrease in cash, cash equivalents and restricted cash	—		(92)		(2)		—		(94)
Cash, cash equivalents, and restricted cash - beginning of year	—		99		102		—		201
Cash, cash equivalents, and restricted cash - end of period	$	—	$	7	$	100	$	—	$	107