Factoring

6 Months Ended

Jun. 30, 2019

Receivables [Abstract]

Factoring

Factoring

The Company receives bank notes generally maturing within six months from certain of its customers in China to settle trade accounts receivable. The Company may hold such bank notes until maturity, exchange them with suppliers to settle liabilities, or sell them to third party financial institutions in exchange for cash.

For the six months ended June 30, 2019, the Company has entered into arrangements with financial institutions and sold $36 million of trade receivables without recourse and $23 million of bank notes without recourse, which qualify as a sale as all rights

to the trade and notes receivable have passed to the financial institution. There were no factoring arrangements for the six months ended June 30, 2018.

As of June 30, 2019, the Company has $7 million of trade notes receivables which remain outstanding and will mature within the second half of 2019. The collections of such bank notes are included in operating cash flows based on the substance of the underlying transactions, which are operating in nature.