Valhi Stockholder's Equity

12 Months Ended

Dec. 31, 2022

Stockholders Equity Note [Abstract]

Valhi Stockholders' Equity

Note 16 – Valhi stockholders’ equity:

	Shares of common stock
	Issued	Treasury	Outstanding
	(In millions)
Balance at December 31, 2020, 2021 and 2022	29.6	(1.1)	28.5

Valhi common stock. We issued a nominal number of shares of Valhi common stock during 2020, 2021 and 2022, associated with annual stock awards to members of our board of directors.

Valhi share repurchases and cancellations. Prior to 2020 our board of directors authorized the repurchase of shares of our common stock in open market transactions, including block purchases, or in privately negotiated transactions, which may include transactions with our affiliates or subsidiaries. The aggregate number of shares authorized for repurchase is 833,333, and we have approximately 334,000 shares available for repurchase at December 31, 2022. We may purchase the stock from time to time as market conditions permit. The stock repurchase program does not include specific price targets or timetables and may be suspended at any time. Depending on market conditions, we may terminate the program prior to completion. We will use cash on hand to acquire the shares. Repurchased shares could be retired and cancelled or may be added to our treasury stock and used for employee benefit plans, future acquisitions or other corporate purposes. We did not make any such purchases under the plan in 2020, 2021 or 2022.

Treasury stock. At December 31, 2021 and 2022, NL and Kronos held approximately 1.2 million and .1 million shares of our common stock, respectively. The treasury stock we reported for financial reporting purposes at December 31, 2021 and 2022 represents our proportional interest in these shares of our common stock held by NL and Kronos, at NL’s and Kronos’ historical cost basis. The remaining portion of these shares of our common stock, which are attributable to the noncontrolling interest of NL and Kronos, are reflected in our consolidated balance sheet at fair value and are classified as part of other noncurrent assets. Under Delaware Corporation Law, 100% (and not the proportionate interest) of a parent company’s shares held by a majority-owned subsidiary of the parent is considered to be treasury stock for voting purposes. As a result, our common shares outstanding for financial reporting purposes differ from those outstanding for legal purposes. Any unrealized gains or losses on the shares of our common stock attributable to the noncontrolling interest of Kronos and NL are recognized in the determination of each of Kronos and NL’s respective net income or loss. Under the principles of consolidation we eliminate any gains or losses associated with our common stock to the extent of our proportional ownership interest in each subsidiary. We recognized a loss of $1.7 million in 2020, a gain of $3.3 million in 2021 and a loss of $1.6 million in 2022 in our Consolidated Statements of Income which represents the unrealized gain (loss) in respect of these shares attributable to the noncontrolling interest of Kronos and NL. See Note 2.

Preferred stock. At December 31, 2019, our outstanding preferred stock consisted of 5,000 shares of our Series A Preferred Stock having a liquidation preference of $133,466.75 per share, or an aggregate liquidation preference of $667.3 million. The outstanding shares of Series A Preferred Stock were held by Contran and represented all of the shares of Series A Preferred Stock we were authorized to issue. The preferred stock had a par value of $.01 per share and paid a non-cumulative cash dividend at an annual rate of 6% of the aggregate liquidation preference only when authorized and declared by our board of directors. The shares of Series A Preferred Stock were non-convertible, and the shares did not carry any redemption or call features (either at our option or the option of the holder). A holder of the Series A shares did not have any voting rights, except in limited circumstances, and was not entitled to a preferential dividend right that is senior to our shares of common stock. We had not declared any dividends on the Series A Preferred Stock since its issuance. Effective August 10, 2020, we, Contran and a wholly owned subsidiary of Contran entered into a contribution agreement pursuant to which, on August 10, 2020, the 6% Series A Preferred Stock was voluntarily contributed to our capital for no consideration and without the issuance of additional securities by us. Our independent directors approved acceptance of such contribution and entering into the contribution agreement. The contribution had no impact on our consolidated financial position, results of operations or liquidity and the contribution did not have any tax consequences to us. On August 10, 2020, following the contribution of the 6% Series A Preferred Stock to us, we filed a Certificate of Elimination with the Secretary of State of Delaware and, as a result, the 5,000 shares that were designated as 6% Series A Preferred Stock have been returned to the status of authorized but unissued shares of the preferred stock, $.01 par value per share, without designation as to series.

Valhi director stock plan. Prior to 2020, our board of directors adopted a plan that provided for the award of stock to our board of directors, and up to a maximum of 200,000 shares could be awarded. Under the plan, we awarded 50,000 shares in 2020. (The share numbers under the then-existing plan have not been adjusted for the 1-for-12 reverse stock split in 2020.) In March 2021, our board of directors voted to replace the existing director stock plan with a new plan that would provide for the award of stock to non-employee members of our board of directors, and up to a maximum of 100,000 shares could be awarded. The new plan was approved at our May 2021 shareholder meeting, at which time the prior director stock plan terminated.  We awarded 4,000 shares and 2,400 shares under this plan in 2021 and 2022, respectively, and at December 31, 2022, 93,600 shares are available for future award under this new plan.

Stock plans of subsidiaries. Kronos, NL and CompX each maintain plans which provide for the award of their common stock to their board of directors. At December 31, 2022, Kronos, NL and CompX had 111,800, 51,150 and 131,050 shares of their respective common stock available for future award under respective plans.

Accumulated other comprehensive income (loss). Accumulated other comprehensive income (loss) attributable to Valhi stockholders comprises changes in equity as presented in the table below.

	Years ended December 31,
	2020		2021		2022
	(In millions)
Accumulated other comprehensive income (loss) (net of tax and   noncontrolling interest):
Marketable securities:
Balance at beginning of year	$	1.7	$	1.8	$	1.7
Other comprehensive income:
Unrealized gain (loss) arising during the year		.1		(.1)		(.1)
Balance at end of year	$	1.8	$	1.7	$	1.6
Currency translation:
Balance at beginning of year	$	(76.8)	$	(67.4)	$	(72.2)
Other comprehensive gain (loss) arising during the year		9.4		(4.8)		(19.3)
Balance at end of year	$	(67.4)	$	(72.2)	$	(91.5)
Defined benefit pension plans:
Balance at beginning of year	$	(146.6)	$	(154.1)	$	(120.9)
Other comprehensive income:
Amortization of prior service cost and net losses   included in net periodic pension cost		9.8		10.7		7.3
Net actuarial gain (loss) arising during the year		(17.3)		22.5		58.4
Plan settlement		—		—		.2
Balance at end of year	$	(154.1)	$	(120.9)	$	(55.0)
OPEB plans:
Balance at beginning of year	$	1.0	$	.3	$	.1
Other comprehensive income:
Amortization of prior service credit and net losses    included in net periodic OPEB cost		(.8)		(.3)		(.5)
Net actuarial gain arising during the year		.1		.1		1.4
Balance at end of year	$	.3	$	.1	$	1.0
Total accumulated other comprehensive loss:
Balance at beginning of year	$	(220.7)	$	(219.4)	$	(191.3)
Other comprehensive income		1.3		28.1		47.4
Balance at end of year	$	(219.4)	$	(191.3)	$	(143.9)

See Note 11 for amounts related to our defined benefit pension plans and Note 10 for amounts related to our OPEB plans.