Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 05, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | TENNECO INC | |
Entity Central Index Key | 1,024,725 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Class A Voting Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 57,086,965 | |
Class B Non-Voting | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 23,793,669 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenues | ||||
Net sales and operating revenues | $ 2,372,000,000 | $ 2,274,000,000 | $ 7,483,000,000 | $ 6,883,000,000 |
Costs and expenses | ||||
Cost of sales (exclusive of depreciation and amortization shown below) | 2,014,000,000 | 1,911,000,000 | 6,371,000,000 | 5,789,000,000 |
Engineering, research, and development | 39,000,000 | 40,000,000 | 122,000,000 | 115,000,000 |
Selling, general, and administrative | 141,000,000 | 127,000,000 | 450,000,000 | 520,000,000 |
Depreciation and amortization of other intangibles | 65,000,000 | 58,000,000 | 183,000,000 | 165,000,000 |
Costs and expenses | 2,259,000,000 | 2,136,000,000 | 7,126,000,000 | 6,589,000,000 |
Other expense | ||||
Loss on sale of receivables | 3,000,000 | 2,000,000 | 8,000,000 | 4,000,000 |
Other expense, net | 6,000,000 | 2,000,000 | 15,000,000 | 8,000,000 |
Total other expense | 9,000,000 | 4,000,000 | 23,000,000 | 12,000,000 |
Earnings before interest expense, income taxes, and noncontrolling interests | 104,000,000 | 134,000,000 | 334,000,000 | 282,000,000 |
Interest expense | 21,000,000 | 19,000,000 | 61,000,000 | 54,000,000 |
Earnings before income taxes and noncontrolling interests | 83,000,000 | 115,000,000 | 273,000,000 | 228,000,000 |
Income tax expense | 20,000,000 | 16,000,000 | 72,000,000 | 41,000,000 |
Net income | 63,000,000 | 99,000,000 | 201,000,000 | 187,000,000 |
Less: Net income attributable to noncontrolling interests | 9,000,000 | 16,000,000 | 39,000,000 | 48,000,000 |
Net income attributable to Tenneco Inc. | $ 54,000,000 | $ 83,000,000 | $ 162,000,000 | $ 139,000,000 |
Weighted average shares of common stock outstanding — | ||||
Basic (in shares) | 51,272,618 | 52,508,078 | 51,247,664 | 53,265,149 |
Diluted (in shares) | 51,401,829 | 52,687,656 | 51,395,927 | 53,501,864 |
Basic earnings per share of common stock (in dollars per share) | $ 1.05 | $ 1.57 | $ 3.17 | $ 2.61 |
Diluted earnings per share of common stock (in dollars per share) | $ 1.05 | $ 1.57 | $ 3.16 | $ 2.60 |
Cash dividends declared (in dollars per share) | $ 0.25 | $ 0.25 | $ 0.75 | $ 0.75 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Net income attributable to Tenneco Inc. | $ 54 | $ 83 | $ 162 | $ 139 |
Less: Net income attributable to noncontrolling interests | 9 | 16 | 39 | 48 |
Net Income | 63 | 99 | 201 | 187 |
Translation of foreign currency statements attributable to Tenneco | (28) | 28 | (102) | 81 |
Translation of foreign currency statements attributable to Noncontrolling Interest | (3) | 1 | (2) | 4 |
Translation of foreign currency statements | (31) | 29 | (104) | 85 |
Additional Liability for Pension and Postretirement Benefits, net of tax attributable to Tenneco | 4 | 3 | 11 | 14 |
Additional liability for pension and postretirement benefits, net of tax | 4 | 3 | 11 | 14 |
Accumulated Other Comprehensive Income (Loss) | ||||
Beginning balance | 742 | |||
Ending balance | 775 | 686 | 775 | 686 |
Other Comprehensive Income (Loss) | (27) | 32 | (93) | 99 |
Comprehensive Income attributable to Tenneco | 30 | 114 | 71 | 234 |
Comprehensive Income attributable to Noncontrolling Interest | 6 | 17 | 37 | 52 |
Comprehensive Income | 36 | 131 | 108 | 286 |
Tenneco Inc. | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Ending balance | 737 | 647 | 737 | 647 |
Other Comprehensive Income (Loss) | (24) | 31 | (91) | |
AOCI Tenneco, Inc | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Beginning balance | (541) | (665) | ||
Ending balance | (632) | (570) | (632) | (570) |
Other Comprehensive Income (Loss) | (91) | 95 | ||
Tenneco, Inc. Cumulative Translation Adjustment | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Beginning balance | (315) | (285) | (241) | (338) |
Reclassification | (28) | 28 | (102) | 81 |
Ending balance | (343) | (257) | (343) | (257) |
Tenneco, Inc. Additional Liability for Pension and Postretirement Benefits | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Beginning balance | (293) | (316) | (300) | (327) |
Reclassification | 4 | 3 | 11 | 14 |
Ending balance | (289) | (313) | (289) | (313) |
Noncontrolling Interests | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Beginning balance | 46 | 47 | ||
Ending balance | 38 | 39 | 38 | 39 |
Other Comprehensive Income (Loss) | (3) | 1 | (2) | 4 |
AOCI Noncontrolling Interests | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Ending balance | (5) | (1) | (5) | (1) |
Noncontrolling Interests Cumulative Translation Adjustment | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Beginning balance | (2) | (2) | (3) | (5) |
Reclassification | (3) | 1 | (2) | 4 |
Ending balance | (5) | (1) | (5) | (1) |
Total | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Ending balance | (637) | (571) | (637) | (571) |
Total Cumulative Translation Adjustment | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Beginning balance | (317) | (287) | (244) | (343) |
Reclassification | (31) | 29 | (104) | 85 |
Ending balance | (348) | (258) | (348) | (258) |
Total Additional Liability for Pension and Postretirement Benefits | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Beginning balance | (293) | (316) | (300) | (327) |
Reclassification | 4 | 3 | 11 | 14 |
Ending balance | $ (289) | $ (313) | $ (289) | $ (313) |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 202 | $ 315 |
Restricted cash | 1 | 3 |
Receivables — | ||
Customer notes and accounts, net | 1,389 | 1,294 |
Other | 19 | 27 |
Inventories — | ||
Finished goods | 372 | 349 |
Work in process | 307 | 268 |
Raw materials | 197 | 178 |
Materials and supplies | 80 | 74 |
Prepayments and other | 369 | 291 |
Total current assets | 2,936 | 2,799 |
Other assets: | ||
Long-term receivables, net | 12 | 9 |
Goodwill | 47 | 49 |
Intangibles, net | 20 | 22 |
Deferred income taxes | 227 | 204 |
Other | 154 | 144 |
Total other assets | 460 | 428 |
Plant, property, and equipment, at cost | 4,068 | 4,008 |
Less — Accumulated depreciation and amortization | (2,436) | (2,393) |
Plant, property and equipment, net | 1,632 | 1,615 |
Total assets | 5,028 | 4,842 |
Current liabilities: | ||
Short-term debt (including current maturities of long-term debt) | 240 | 83 |
Accounts payable | 1,769 | 1,705 |
Accrued taxes | 38 | 45 |
Accrued interest | 10 | 14 |
Accrued liabilities | 299 | 287 |
Other | 136 | 132 |
Total current liabilities | 2,492 | 2,266 |
Long-term debt | 1,304 | 1,358 |
Deferred income taxes | 11 | 11 |
Pension and postretirement benefits | 258 | 268 |
Deferred credits and other liabilities | 160 | 155 |
Commitments and contingencies (Note 8) | 0 | 0 |
Total liabilities | 4,225 | 4,058 |
Redeemable noncontrolling interests | 28 | 42 |
Tenneco Inc. shareholders’ equity: | ||
Common stock | 1 | 1 |
Premium on common stock and other capital surplus | 3,121 | 3,112 |
Accumulated other comprehensive loss | (632) | (541) |
Accumulated deficit | (823) | (946) |
Total shareholders equity before treasury stock | 1,667 | 1,626 |
Less — Shares held as treasury stock, at cost | 930 | 930 |
Tenneco Inc. shareholders’ equity | 737 | 696 |
Noncontrolling interests | 38 | 46 |
Total equity | 775 | 742 |
Total liabilities, redeemable noncontrolling interests and equity | $ 5,028 | $ 4,842 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Operating Activities | ||||
Net Income | $ 63 | $ 99 | $ 201 | $ 187 |
Adjustments to reconcile net income to cash (used) provided by operating activities — | ||||
Depreciation and amortization of other intangibles | 65 | 58 | 183 | 165 |
Deferred income taxes | (13) | (1) | (22) | (1) |
Stock-based compensation | 5 | 1 | 12 | 12 |
Loss on sale of assets | 3 | 1 | 8 | 2 |
Changes in components of working capital — | ||||
(Increase) decrease in receivables | (29) | 13 | (268) | (212) |
Increase in inventories | (65) | (56) | (118) | (116) |
Increase in prepayments and other current assets | (21) | (8) | (91) | (76) |
(Decrease) increase in accounts payable | (26) | (29) | 141 | 57 |
(Decrease) increase in accrued taxes | (3) | 16 | (6) | (22) |
Decrease in accrued interest | (3) | (3) | (3) | (5) |
(Decrease) increase in other current liabilities | (19) | (51) | 11 | 101 |
Changes in long-term assets | (4) | (10) | (18) | (10) |
Changes in long-term liabilities | 1 | (6) | 2 | 1 |
Other | 5 | 1 | 5 | 3 |
Net cash (used) provided by operating activities | (41) | 25 | 37 | 86 |
Investing Activities | ||||
Proceeds from sale of assets | 1 | 0 | 6 | 6 |
Proceeds from sale of equity interest | 0 | 0 | 0 | 9 |
Cash payments for plant, property, and equipment | (78) | (90) | (242) | (283) |
Cash payments for software related intangible assets | (3) | (5) | (13) | (17) |
Proceeds from deferred purchase price of factored receivables | 36 | 28 | 102 | 77 |
Other | (4) | (1) | (2) | (5) |
Net cash used by investing activities | (48) | (68) | (149) | (213) |
Financing Activities | ||||
(Repurchase) issuance of common shares | (1) | 1 | (2) | (2) |
Cash dividends | (14) | (14) | (39) | (40) |
Payments of long-term debt | (5) | (1) | (17) | (9) |
Issuance of long-term debt | 0 | 0 | 0 | 136 |
Debt issuance cost of long-term debt | 0 | 0 | (2) | (8) |
Purchase of common stock under the share repurchase program | 0 | (71) | 0 | (131) |
Net increase (decrease) in bank overdrafts | 2 | (3) | (5) | (12) |
Net (decrease) increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable | (77) | 84 | (29) | 144 |
Net increase in short-term borrowings secured by accounts receivable | 170 | 0 | 150 | 20 |
Distributions to noncontrolling interest partners | (16) | (12) | (44) | (45) |
Net cash provided (used) by financing activities | 59 | (16) | 12 | 53 |
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash | (4) | 3 | (15) | 4 |
Decrease in cash, cash equivalents and restricted cash | (34) | (56) | (115) | (70) |
Cash, cash equivalents and restricted cash, beginning of period | 237 | 335 | 318 | 349 |
Cash, cash equivalents and restricted cash, end of period (Note) | 203 | 279 | 203 | 279 |
Supplemental Cash Flow Information | ||||
Cash paid during the period for interest (net of interest capitalized) | 25 | 23 | 65 | 61 |
Cash paid during the period for income taxes (net of refunds) | 23 | 31 | 79 | 74 |
Non-cash Investing and Financing Activities | ||||
Period end balance of accounts payable for plant, property, and equipment | 52 | 53 | 52 | 53 |
Deferred purchase price of receivables factored in the period | $ 34 | $ 27 | $ 105 | $ 80 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY - USD ($) | Total | Common Stock | Premium on Common Stock and Other Capital Surplus | Accumulated Other Comprehensive Loss | Accumulated Deficit | Less — Common Stock Held as Treasury Stock at Cost | Tenneco Inc. | Noncontrolling Interests |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Beginning balance | $ 1,000,000 | $ 3,098,000,000 | $ (665,000,000) | $ (1,100,000,000) | $ 761,000,000 | $ 47,000,000 | ||
Ending balance | $ 1,000,000 | 3,098,000,000 | (665,000,000) | (1,100,000,000) | $ 761,000,000 | 47,000,000 | ||
Beginning balance (in shares) at Dec. 31, 2016 | 65,891,930 | 11,655,938 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
(Repurchased) issued pursuant to benefit plans (in shares) | 35,843 | |||||||
Restricted shares forfeited (shares) | (126,682) | |||||||
Stock options exercised (shares) | 208,818 | |||||||
Premium on common stock issued pursuant to benefit plans | 11,000,000 | |||||||
Other comprehensive (loss) income | $ 99,000,000 | 95,000,000 | 4,000,000 | |||||
Net income attributable to Tenneco Inc. | 139,000,000 | 139,000,000 | ||||||
Cash dividends declared | (0.75) | (40,000,000) | ||||||
Purchase of common stock through stock repurchase program (shares) | 2,310,443 | |||||||
Purchase of common stock through stock repurchase program | $ 131,000,000 | |||||||
Net income | 21,000,000 | |||||||
Other comprehensive income | 2,000,000 | 2,000,000 | ||||||
Dividends declared | (31,000,000) | |||||||
Ending balance (in shares) at Sep. 30, 2017 | 66,009,909 | 13,966,381 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Other comprehensive (loss) income | 32,000,000 | $ 31,000,000 | 1,000,000 | |||||
Net income attributable to Tenneco Inc. | 83,000,000 | |||||||
Cash dividends declared | (0.25) | |||||||
Ending balance (in shares) at Sep. 30, 2017 | 66,009,909 | 13,966,381 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Beginning balance | 686,000,000 | $ 1,000,000 | 3,109,000,000 | (570,000,000) | (1,001,000,000) | $ 892,000,000 | 647,000,000 | 39,000,000 |
Ending balance | 686,000,000 | 1,000,000 | 3,109,000,000 | (570,000,000) | (1,001,000,000) | 892,000,000 | 647,000,000 | 39,000,000 |
Beginning balance | 742,000,000 | 1,000,000 | 3,112,000,000 | (541,000,000) | (946,000,000) | 930,000,000 | 46,000,000 | |
Ending balance | 742,000,000 | $ 1,000,000 | 3,112,000,000 | (541,000,000) | (946,000,000) | $ 930,000,000 | 46,000,000 | |
Beginning balance (in shares) at Dec. 31, 2017 | 66,033,509 | 14,592,888 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
(Repurchased) issued pursuant to benefit plans (in shares) | (18,553) | |||||||
Restricted shares forfeited (shares) | (8,062) | |||||||
Stock options exercised (shares) | 16,199 | |||||||
Premium on common stock issued pursuant to benefit plans | 9,000,000 | |||||||
Other comprehensive (loss) income | (93,000,000) | (91,000,000) | (91,000,000) | (2,000,000) | ||||
Net income attributable to Tenneco Inc. | 162,000,000 | 162,000,000 | ||||||
Cash dividends declared | (0.75) | (39,000,000) | ||||||
Adoption of accounting standards | ASU 2014-09 | 1,000,000 | |||||||
Adoption of accounting standards | ASU 2016-16 | (2,000,000) | (2,000,000) | ||||||
Purchase of common stock through stock repurchase program (shares) | 0 | |||||||
Purchase of common stock through stock repurchase program | $ 0 | |||||||
Net income | 17,000,000 | |||||||
Other comprehensive income | $ (3,000,000) | 1,000,000 | ||||||
Dividends declared | (26,000,000) | |||||||
Ending balance (in shares) at Sep. 30, 2018 | 66,023,093 | 14,592,888 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Stock options exercised (shares) | 11,420 | |||||||
Other comprehensive (loss) income | $ (27,000,000) | (24,000,000) | (3,000,000) | |||||
Net income attributable to Tenneco Inc. | 54,000,000 | |||||||
Cash dividends declared | (0.25) | |||||||
Ending balance (in shares) at Sep. 30, 2018 | 66,023,093 | 14,592,888 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Beginning balance | 775,000,000 | $ 1,000,000 | 3,121,000,000 | (632,000,000) | (823,000,000) | $ 930,000,000 | 737,000,000 | 38,000,000 |
Ending balance | $ 775,000,000 | $ 1,000,000 | $ 3,121,000,000 | $ (632,000,000) | $ (823,000,000) | $ 930,000,000 | $ 737,000,000 | $ 38,000,000 |
Consolidation and Presentation
Consolidation and Presentation | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation and Presentation | Consolidation and Presentation Tenneco Inc. ("Tenneco" or "the Company") is one of the world’s leading manufacturers of clean air and ride performance products and systems for light vehicle, commercial truck and off-highway applications. We also engineer, manufacture, market and distribute leading brand name products to a diversified and global aftermarket customer base. Unless the context indicates otherwise, references herein to and words such as "we," "us," or "our" include the Company and its consolidated subsidiaries. As you read the accompanying financial statements you should also read our Annual Report on Form 10-K for the year ended December 31, 2017 , which was filed with the Securities and Exchange Commission (SEC) on February 28, 2018 (the "2017 Form 10-K"). A Form 8-K was also filed with the SEC on September 28, 2018 to recast certain portions of the 2017 Form 10-K to retrospectively reflect the effect of the Company's change in reporting segments that took effect in the first quarter of 2018, and to recast certain financial information and related disclosures for accounting standards adopted in 2018, for which retrospective application was required. In our opinion, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary for a fair statement of the Company’s results of operations, comprehensive income, financial position, cash flows, and changes in shareholders’ equity for the periods indicated. We have prepared the unaudited condensed consolidated financial statements pursuant to the rules and regulations of the SEC for interim financial information. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (U.S. GAAP) for annual financial statements. Our unaudited condensed consolidated financial statements include all majority-owned subsidiaries. We have eliminated all intercompany transactions. Segment Information In the first quarter of 2018, the Company’s reportable segments were revised, and now consist of the following three segments: Clean Air, Ride Performance and Aftermarket. See Note 13, Segment Information for further information. Prepayments and Other Prepayments and other included $156 million and $117 million at September 30, 2018 and December 31, 2017 , respectively, for in-process tools and dies that we are building for our original equipment customers. Accounts Payable Accounts payable included $110 million and $77 million at September 30, 2018 and December 31, 2017 , respectively, for accrued compensation and $15 million and $20 million at September 30, 2018 and December 31, 2017 , respectively, for bank overdrafts at our European subsidiaries. Redeemable Noncontrolling Interests The following is a rollforward of activities in our redeemable noncontrolling interests for the nine months ended September 30, 2018 and 2017 : Nine Months Ended 2018 2017 (Millions) Balance January 1 $ 42 $ 40 Net income attributable to redeemable noncontrolling interests 22 27 Other comprehensive (loss) income (3 ) 2 Dividends declared (33 ) (37 ) Balance September 30 $ 28 $ 32 Reclassifications Reclassifications to certain prior year amounts have been made to conform to current year presentation. See Note 12, New Accounting Pronouncements for additional information. |
Acquisition of Federal-Mogul
Acquisition of Federal-Mogul | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Acquisition of Federal-Mogul | Acquisition of Federal-Mogul On October 1, 2018, we closed on the acquisition of all of the interests in Federal-Mogul LLC ("Federal-Mogul"), (the "Acquisition") pursuant to the Membership Interest Purchase Agreement, dated as of April 10, 2018 (the “Purchase Agreement”), by and among the Company, Federal-Mogul, American Entertainment Properties Corp. (“AEP” and, together with certain affiliated entities, the “Sellers”) and Icahn Enterprises L.P. (“IEP”). Total consideration was approximately $5.2 billion . Following the completion of the Acquisition, Federal-Mogul was merged with and into the Company, with the Company continuing as the surviving company. At the effective time of the Acquisition, the Company’s certificate of incorporation was amended and restated (the “Amended and Restated Certificate of Incorporation”) in order to create a new class of non-voting common stock of the Company called “Class B Non-Voting Common Stock” (“Class B Common Stock”) with 25,000,000 shares authorized, and to reclassify the Company’s existing common stock as “Class A Voting Common Stock” (“Class A Common Stock”). Under the Amended and Restated Certificate of Incorporation, the authorized number of shares was increased from 185,000,000 shares, divided into 135,000,000 shares of common stock, par value $0.01 , and 50,000,000 shares of preferred stock, par value $0.01 , to 250,000,000 shares, divided into 175,000,000 shares of Class A Common Stock, 25,000,000 shares of Class B Common Stock and 50,000,000 shares of preferred stock, par value $0.01 . The Company (i) paid to AEP an aggregate amount in cash equal to $800 million (the “Cash Consideration”) and (ii) issued and delivered to AEP an aggregate of 29,444,846 shares of common stock at $41.99 per share. The $1.2 billion of common stock was comprised of: (a) 5,651,177 shares of Class A Common Stock, par value $0.01 equal to 9.9 percent of the aggregate number of shares of Class A Common Stock issued and outstanding immediately following the closing of the Acquisition, and (b) 23,793,669 shares of newly created Class B Common Stock, par value $0.01 . The remaining of approximately $3.2 billion of consideration was comprised of the assumption of Federal-Mogul debt obligations. Following the closing of the Acquisition, the Company has agreed to use its reasonable best efforts to pursue the separation of the combined company’s powertrain technology business and its aftermarket and ride performance business into two separate, publicly traded companies in a spin-off transaction that is expected to be treated as a tax-free reorganization for U.S. federal income tax purposes. Advisory costs associated with the Acquisition were $12 million and $43 million for the three and nine months ended September 30, 2018 , respectively, and have been recognized as a component of selling, general, and administrative expenses in the condensed consolidated statements of income. |
Financial Instruments
Financial Instruments | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments | Financial Instruments The net carrying and estimated fair values of our financial instruments by class at September 30, 2018 and December 31, 2017 were as follows: September 30, 2018 December 31, 2017 Net Carrying Amount Fair Value Net Carrying Amount Fair Value (Millions) Long-term debt (including current maturities) $ 1,308 $ 1,252 $ 1,361 $ 1,398 Equity swap agreement and foreign currency forward contracts: Asset derivative contracts (a) 5 5 4 4 (a) All derivatives are categorized within Level 2 of the fair value hierarchy. Asset and Liability Instruments — The fair value of cash and cash equivalents, short and long-term receivables, accounts payable, and short-term debt was considered to be the same as or was not determined to be materially different from the carrying amount. Long-term Debt — The fair value of our public fixed rate senior notes is based on quoted market prices (level 1). The fair value of our private borrowings under our senior credit facility as of September 30, 2018 and other long-term debt instruments is based on the market value of debt with similar maturities, interest rates and risk characteristics (level 2). The fair value of our level 1 debt, as classified in the fair value hierarchy, was $657 million and $749 million at September 30, 2018 and December 31, 2017 , respectively. We have classified $582 million and $634 million as level 2 in the fair value hierarchy at September 30, 2018 and December 31, 2017 , respectively, since we utilize valuation inputs that are observable either directly or indirectly. We classified the remaining $13 million and $15 million , consisting of foreign subsidiary debt, as level 3 in the fair value hierarchy at September 30, 2018 and December 31, 2017 , respectively. The fair value hierarchy definition prioritizes the inputs used in measuring fair value into the following levels: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Inputs, other than quoted prices in active markets, that are observable either directly or indirectly. Level 3 — Unobservable inputs based on our own assumptions. Foreign Currency Forward Contracts — We use derivative financial instruments, principally foreign currency forward purchase and sales contracts with terms of less than one year , to hedge our exposure to changes in foreign currency exchange rates. Our primary exposure to changes in foreign currency rates results from intercompany loans made between affiliates to minimize the need for borrowings from third parties. Additionally, we enter into foreign currency forward purchase and sale contracts to mitigate our exposure to changes in exchange rates on certain intercompany and third-party trade receivables and payables. We manage counter-party credit risk by entering into derivative financial instruments with major financial institutions that can be expected to fully perform under the terms of such agreements. We do not enter into derivative financial instruments for speculative purposes. The fair value of our foreign currency forward contracts is based on an internally developed model which incorporates observable inputs including quoted spot rates, forward exchange rates and discounted future expected cash flows utilizing market interest rates with similar quality and maturity characteristics. We record the change in fair value of these foreign currency forward contracts as part of currency gains (losses) within cost of sales in the consolidated statements of income. The fair value of foreign currency forward contracts are recorded in prepayments and other current assets or other current liabilities in the consolidated balance sheets. The fair value of our foreign currency forward contracts was a net liability position of less than $1 million at both September 30, 2018 and December 31, 2017 . The following table summarizes by major currency the notional amounts for foreign currency forward purchase and sale contracts as of September 30, 2018 (all of which mature in 2018): Notional Amount in Foreign Currency (Millions) Canadian dollars —Sell (2 ) Chinese yuan —Purchase 4 U.S. dollars —Purchase 1 Cash-settled Share Swap Transactions — We selectively use cash-settled share swaps to reduce market risk associated with our deferred liabilities. These equity compensation liabilities increase as our stock price increases and decrease as our stock price decreases. In contrast, the value of the swap agreement moves in the opposite direction of these liabilities, allowing us to fix a portion of the liabilities at a stated amount. As of September 30, 2018 , we had hedged our deferred liability related to approximately 250,000 common share equivalents. The fair value of the equity swap agreement is recorded in other current assets in the condensed consolidated balance sheets. The fair value of our equity swap agreement was a net asset position of $5 million and $4 million at September 30, 2018 and December 31, 2017 , respectively. Guarantees —We have from time to time issued guarantees for the performance of obligations of some of our subsidiaries, and some of our subsidiaries have guaranteed our debt. At September 30, 2018, all of our existing and future material domestic subsidiaries fully and unconditionally guaranteed our senior credit facility and our senior notes on a joint and several basis. The arrangement for the senior credit facility was also secured by first-priority liens on substantially all our domestic assets and pledges of up to 66 percent of the stock of certain first-tier foreign subsidiaries. At September 30, 2018, no assets or capital stock secured our senior notes. For additional information, refer to Note 14, Supplemental Guarantor Condensed Consolidating Financial Statements. We have two performance guarantee agreements in the U.K. between Tenneco Management (Europe) Limited (“TMEL”) and the two Walker Group Retirement Plans, the Walker Group Employee Benefit Plan and the Walker Group Executive Retirement Benefit Plan (the “Walker Plans”), whereby TMEL will guarantee the payment of all current and future pension contributions in the event of a payment default by the sponsoring or participating employers of the Walker Plans. The Walker Plans are comprised of employees from Tenneco Walker (U.K.) Limited and Futaba (U.K.) Limited, formerly our Futaba-Tenneco (U.K.) joint venture. Employer contributions are funded by Tenneco Walker (U.K.) Limited, as the sponsoring employer, and were also funded by Futaba (U.K.) Limited prior to its ceasing, on April 28, 2017, to be an entity in which the Company has an equity interest. The performance guarantee agreements are expected to remain in effect until all pension obligations for the Walker Plans’ sponsoring and participating employers have been satisfied. We did not record an additional liability for this performance guarantee since Tenneco Walker (U.K.) Limited, as the sponsoring employer of the Walker Plans, already recognizes 100% of the pension obligation calculated based on U.S. GAAP, for all of the Walker Plans’ participating employers on its balance sheet. As of September 30, 2018 and December 31, 2017 , these plans were in an overfunded position and shown under other assets, other on our condensed consolidated balance sheets. At September 30, 2018 , all pension contributions under the Walker Plans were current for all of the Walker Plans’ sponsoring and participating employers. We have issued guarantees through letters of credit in connection with some obligations of our affiliates. As of September 30, 2018 , we have guaranteed $27 million in letters of credit to support some of our subsidiaries’ insurance arrangements, foreign employee benefit programs, environmental remediation activities and cash management and capital requirements. Financial Instruments — In certain instances, several of our Chinese subsidiaries receive payment from customers through the receipt of financial instruments on the date the customer payments are due. Several of our Chinese subsidiaries also satisfy vendor payments through the delivery of financial instruments on the date the payments are due. Financial instruments issued to satisfy vendor payables and not redeemed totaled $12 million and $11 million at September 30, 2018 and December 31, 2017 , respectively, and were classified as notes payable recorded in short-term debt in our condensed consolidated balance sheets. Financial instruments received from original equipment (OE) customers and not redeemed totaled $27 million and $10 million at September 30, 2018 and December 31, 2017 , respectively, and were classified as other current assets in our condensed consolidated balance sheets. We classify financial instruments received from our customers as other current assets, recorded in prepayments and other, if issued by a financial institution of our customers or as customer notes and accounts, net if issued by our customer. The financial instruments received by some of our Chinese subsidiaries are drafts drawn that are payable at a future date and, in some cases, are negotiable and/or are guaranteed by the banks of the customers. The use of these instruments for payment follows local commercial practice. Because certain of such financial instruments are guaranteed by our customers’ banks, we believe they represent a lower financial risk than the outstanding accounts receivable that they satisfy which are not guaranteed by a bank. Supply Chain Financing — Certain of our suppliers in the U.S. participate in supply chain financing programs under which they securitize their accounts receivables from the Company. Financial institutions participate in the supply chain financing program on an uncommitted basis and can cease purchasing receivables or drafts from the Company's suppliers at any time. If the financial institutions do not continue to purchase receivables or drafts from the Company's suppliers under these programs, the participating vendors may have a need to renegotiate their payment terms with the Company which in turn would cause our borrowings under our revolving credit facility to increase. Restricted Cash — Some of our Chinese subsidiaries that issue their own financial instruments to pay vendors are required to maintain a cash balance if they exceed credit limits with the financial institution that guarantees the financial instruments. There was no restricted cash balance required at those Chinese subsidiaries at September 30, 2018 and $2 million at December 31, 2017 . One of our subsidiaries in Spain is required by law to maintain a cash deposit with a financial institution to guarantee the maximum estimated loss related to a tax audit until a settlement is reached. The cash deposit required was less than $1 million which has been classified as restricted cash on the Company's condensed consolidated balance sheets at both September 30, 2018 and December 31, 2017 . As of December 31, 2017, there was a similar cash deposit required for one of our subsidiaries in Brazil for approximately $1 million . The audit was closed in 2018 and the Brazil subsidiary has no restricted cash balance as of September 30, 2018 . |
Debt and Other Financing Arrang
Debt and Other Financing Arrangements | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt and Financing Arrangements | Debt and Other Financing Arrangements Long-Term Debt A summary of our long-term debt obligations at September 30, 2018 and December 31, 2017 is set forth in the following table: September 30, 2018 December 31, 2017 Principal Carrying Amount (1) Principal Carrying Amount (1) (Millions) Tenneco Inc. — Revolver borrowings due 2022 $ 207 $ 207 $ 244 $ 244 Senior Tranche A Term Loan due 2022 375 373 390 388 5 3/8% Senior Notes due 2024 225 222 225 222 5% Senior Notes due 2026 500 493 500 492 Other subsidiaries — Other long-term debt due in 2020 6 6 5 5 Notes due 2018 through 2028 8 7 12 10 1,321 1,308 1,376 1,361 Less — maturities classified as current 4 4 3 3 Total long-term debt $ 1,317 $ 1,304 $ 1,373 $ 1,358 (1) Carrying amount is net of unamortized debt issuance costs and debt discounts. Total unamortized debt issuance costs were $11 million and $13 million as of September 30, 2018 and December 31, 2017 , respectively, and the total unamortized debt discount was $2 million as of both September 30, 2018 and December 31, 2017 . Short-Term Debt Our short-term debt includes the current portion of long-term debt, borrowings by the parent company and foreign subsidiaries, which includes borrowings under both committed credit facilities and uncommitted lines of credit and similar arrangements, and borrowings under the U.S. accounts receivable securitization program as discussed in Note 6, Accounts Receivable Securitization and Factoring Programs. Information regarding our short-term debt as of September 30, 2018 and December 31, 2017 is as follows: September 30, December 31, (Millions) Maturities classified as current $ 4 $ 3 Short-term borrowings 236 80 Total short-term debt $ 240 $ 83 Financing Arrangements As of September 30, 2018, our financing arrangements were primarily provided by a committed senior secured credit facility with a syndicate of banks and other financial institutions. The arrangement was secured by substantially all our domestic assets and pledges of up to 66 percent of the stock of certain first-tier foreign subsidiaries, as well as guarantees by our material domestic subsidiaries. We were required to make quarterly principal payments under the term loan A facility of $5 million through June 30, 2019, $7.5 million beginning September 30, 2019 through June 30, 2020, $10 million beginning September 30, 2020 through March 31, 2022 and a final payment of $260 million is due on May 12, 2022. We excluded the required payments, within the twelve months after September 30, 2018, under the term loan A facility totaling $22.5 million from current liabilities as of September 30, 2018 , because we had the intent and the ability to refinance the obligations on a long-term basis by using our revolving credit facility. New Credit Facility On October 1, 2018, the Company entered into a new credit agreement with JPMorgan Chase Bank, N.A., as administrative agent and other lenders (the “New Credit Facility”) in connection with the acquisition of Federal-Mogul. The New Credit Facility consists of $4.9 billion of total debt financing, consisting of a five -year $1.5 billion revolving credit facility, a five -year $1.7 billion term loan A facility and a seven -year $1.7 billion term loan B facility. Proceeds from the New Credit Facility were used to finance the Cash Consideration portion of the Acquisition purchase price, to refinance the Company’s then existing senior credit facilities, inclusive of the revolver and the term loan A then outstanding, and certain senior credit facilities of Federal-Mogul, and to pay fees and expenses relating to the Acquisition and the financing thereof, and the remainder, including future borrowings under the revolving credit facility, will be used for general corporate purposes. Each of the Company and Tenneco Automotive Operating Company Inc. are borrowers under the New Credit Facility, and the Company is the sole borrower under the term loan A and term loan B facilities. The New Credit Facility is guaranteed on a senior basis by certain material domestic subsidiaries of the Company. Drawings under the revolving credit facility may be in U.S. Dollars, Pounds Sterling or Euros. The New Credit Facility is secured by substantially all domestic assets of the Company and the subsidiary guarantors and by pledges of up to 66 percent of the stock of certain first-tier foreign subsidiaries. The security for the New Credit Facility will be pari passu with the security for outstanding senior secured notes of Federal-Mogul that were assumed by the Company in connection with the Acquisition. If any foreign subsidiary of the Company is added to the revolving credit facility as a borrower, the obligations of such foreign borrower will be secured by the assets of such foreign borrower, and also will be secured by the assets of, and guaranteed by, the domestic borrowers and domestic guarantors as well as certain foreign subsidiaries of the Company in the chain of ownership of such foreign borrower. The term loan A and revolving credit facilities will mature on the fifth anniversary of closing, and the term loan B facility will mature on the seventh anniversary of closing. The term loan A facility is payable in 19 consecutive quarterly installments, commencing March 31, 2019, with 5% being paid annually in each of the first two years, 7.5% in the third year, 10% annually in each of the fourth and fifth years and the remainder on the maturity date. The term loan B facility is payable in 27 consecutive quarterly installments, commencing March 31, 2019, with 0.25% being paid in 27 quarterly installments and the remainder on the maturity date. The interest rate on borrowings under the revolving credit facility and the term loan A facility will initially be LIBOR plus 1.75% , which interest rate will be subject to change if the Company’s consolidated net leverage ratio changes. Initially, and so long as the Company’s corporate family rating is Ba3 (with a stable outlook) or higher from Moody’s Investors Service, Inc. (“Moody’s”) and BB- (with a stable outlook) or higher from Standard & Poor’s Financial Services LLC (“S&P”), the interest rate on borrowings under the term loan B facility will be LIBOR plus 2.75% ; at any time the foregoing conditions are not satisfied, the interest rate on the term loan B facility will be LIBOR plus 3.00% . When the term loan B facility is no longer outstanding and the Company and its subsidiaries have no other secured indebtedness (with certain exceptions set forth in the New Credit Facility), and upon the Company achieving and maintaining two or more corporate credit and/or corporate family ratings higher than or equal to BBB- from S&P, BBB- from Fitch Ratings Inc. (“Fitch”) and/or Baa3 from Moody’s (in each case, with a stable or positive outlook), the collateral under the New Credit Facility may be released. The New Credit Facility contains representations and warranties and affirmative and negative covenants which are customary for debt facilities of this type. The negative covenants limit the ability of the Company and its restricted subsidiaries to, among other things, (i) incur additional indebtedness or issue preferred stock, (ii) pay dividends or make distributions to the Company’s stockholders, (iii) purchase or redeem the Company’s equity interests, (iv) make investments, (v) create liens on their assets, (vi) enter into transactions with the Company’s affiliates, (vii) sell assets and (viii) merge or consolidate with, or dispose of substantially all of the Company’s assets to, other companies. The New Credit Facility also contains two financial maintenance covenants for the revolving credit facility and the term loan A facility including (x) a requirement to have a consolidated net leverage ratio (as defined in the New Credit Facility) as of the end of each fiscal quarter of not greater than 4.0 to 1 through September 30, 2019, 3.75 to 1 through September 30, 2020 and 3.5 to 1 thereafter; and (y) a requirement to maintain consolidated interest coverage ratio (as defined in the New Credit Facility) for any period of four consecutive fiscal quarters of not less than 2.75 to 1 . The New Credit Facility includes customary events of default and other provisions that could require all amounts due thereunder to become immediately due and payable, either automatically or at the option of the lenders, if the Company fails to comply with the terms of the New Credit Facility or if other customary events occur. The New Credit Facility does not contain any terms that could accelerate the payment of it as a result of a credit rating change. The financial ratios required under the senior credit facility outstanding as of September 30, 2018, and the actual ratios we achieved for the first three quarters of 2018, are as follows: Quarter Ended September 30, 2018 June 30, 2018 March 31, 2018 Required Actual Required Actual Required Actual Leverage Ratio (maximum) 3.50 2.05 3.50 1.79 3.50 2.09 Interest Coverage Ratio (minimum) 2.75 10.05 2.75 10.84 2.75 9.87 At September 30, 2018, the senior credit facility included a maximum leverage ratio covenant of 3.50 and a minimum interest coverage ratio of 2.75 , in each case through May 12, 2022. The senior credit facility provided us with the flexibility not to exclude certain otherwise excludable charges incurred in any relevant period from the calculation of the leverage and interest coverage ratios for such period. At September 30, 2018 , of the $1.6 billion available under the revolving credit facility, we had unused borrowing capacity of $1,393 million with $207 million in outstanding borrowings and no outstanding letters of credit. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For interim tax reporting, we estimate our annual effective tax rate and apply it to our year to date ordinary income. Jurisdictions where no tax benefit can be recognized due to a valuation allowance are excluded from the estimated annual effective tax rate. The impact of including these jurisdictions on the quarterly effective rate calculation could result in a higher or lower effective tax rate during a particular quarter due to the mix and timing of actual earnings versus annual projections. The tax effects of certain items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are excluded from the estimated annual effective tax rate calculation and recognized in the interim period in which they occur. We reported income tax expense of $20 million and $16 million in the three month periods ended September 30, 2018 and 2017 , respectively. The tax expense recorded in the third quarter of 2018 included a tax benefit of $5 million relating to acquisition and restructuring charges, a tax benefit of $10 million relating to a valuation allowance release at our Australian entities and $9 million of tax expense for changes in the toll tax as discussed below. The tax benefit recorded in the third quarter of 2017 included a tax benefit of $12 million primarily relating to valuation allowance releases. We reported income tax expense of $72 million and $41 million in the nine month periods ended September 30, 2018 and 2017 , respectively. The tax expense recorded in the first nine months of 2018 included tax benefits of $12 million relating to acquisition and restructuring charges, a tax benefit of $10 million relating to a valuation allowance release at our Australian entities and $11 million of tax expense for changes in the toll tax as discussed below. The tax expense recorded in the first nine months of 2017 included a tax benefit of $12 million primarily relating to valuation allowance releases. In addition, the 2017 tax expense included a $50 million tax benefit related to an antitrust settlement accrual. On December 22, 2017, the Tax Cuts and Jobs Act ("TCJA") was enacted into U.S. law, which, among other provisions, lowered the corporate income tax rate effective January 1, 2018 from 35% to 21% , and implemented significant changes with respect to U.S. tax treatment of earnings originating from outside the U.S. Many of the provisions of TCJA are subject to regulatory interpretation and U.S. state conforming enactments. The Internal Revenue Service (IRS) issued Notice 2018-26 on April 2, 2018, which provided additional guidance to assist taxpayers in computing the toll tax. Based on the new guidance, a $2 million discrete charge was recorded in income tax expense for the second quarter of 2018. On August 1 2018, the IRS issued proposed regulations under section 965, which provided additional guidance to assist taxpayers in computing the toll tax. Based on the new guidance, an additional $9 million discrete charge was recorded in income tax expense for the third quarter of 2018. Material U.S. state income tax conformity to current federal tax code is still pending as of September 30, 2018. We will continue to refine our estimates throughout the measurement period provided for in SEC Staff Accounting Bulletin 118, or until our accounting is complete, whichever comes first. Our losses in various foreign taxing jurisdictions represented sufficient negative evidence to require us to maintain a full valuation allowance against certain of our net deferred tax assets. We evaluate our deferred tax assets quarterly to determine if valuation allowances are required or should be adjusted. This assessment considers, among other matters, the nature, frequency and amount of recent losses, the duration of statutory carryforward periods, and tax planning strategies. In making such judgments, significant weight is given to evidence that can be objectively verified. If recent operational improvements continue in our foreign subsidiaries or if certain restructuring steps are completed as part of the Acquisition and planned spin-off of the ride performance and aftermarket company, we believe it is reasonably possible that sufficient positive evidence may be available to release all, or a portion, of the valuation allowance in the next twelve months. This may result in a one-time tax benefit of up to $53 million , primarily related to China and Spain. We believe it is reasonably possible that up to $6 million in unrecognized tax benefits related to the expiration of foreign statute of limitations and the conclusion of income tax examinations may be recognized within the next twelve months. |
Accounts Receivable Securitizat
Accounts Receivable Securitization and Factoring Programs | 9 Months Ended |
Sep. 30, 2018 | |
Accounts Receivable Additional Disclosures [Abstract] | |
Accounts Receivable Securitization and Factoring Programs | Accounts Receivable Securitization and Factoring Programs We securitize or factor some of our accounts receivable on a limited recourse basis in the U.S. and Europe. As a servicer under these accounts receivable securitization and factoring programs, we are responsible for performing all accounts receivable administration functions for these securitized and factored financial assets including collections and processing of customer invoice adjustments. In the U.S., we have an accounts receivable securitization program with three commercial banks comprised of a first priority facility and a second priority facility. We securitize original equipment and aftermarket receivables on a daily basis under the bank program. In April 2017, the U.S. program was amended and extended to April 30, 2019. The first priority facility provides financing of up to $155 million and the second priority facility, which is subordinated to the first priority facility, provides up to an additional $25 million of financing. Both facilities monetize accounts receivable generated in the U.S. that meet certain eligibility requirements and the second priority facility also monetizes certain accounts receivable generated in the U.S. that would otherwise be ineligible under the first priority securitization facility. The amount of outstanding third-party investments in our securitized accounts receivable under the U.S. program was $180 million and $30 million , recorded in short-term debt, at September 30, 2018 and December 31, 2017 , respectively. Each facility contains customary covenants for financings of this type, including restrictions related to liens, payments, mergers or consolidations and amendments to the agreements underlying the receivables pool. Further, each facility may be terminated upon the occurrence of customary events (with customary grace periods, if applicable), including breaches of covenants, failure to maintain certain financial ratios, inaccuracies of representations and warranties, bankruptcy and insolvency events, certain changes in the rate of default or delinquency of the receivables, a change of control and the entry or other enforcement of material judgments. In addition, each facility contains cross-default provisions, where the facility could be terminated in the event of non-payment of other material indebtedness when due and any other event which permits the acceleration of the maturity of material indebtedness. On December 14, 2017, we entered into a new accounts receivable factoring program in the U.S. with a commercial bank. Under this program, we sell receivables from one of our U.S. OE customers at a rate that is favorable versus our senior credit facility. This arrangement is uncommitted and provides for cancellation by the commercial bank with no less than 30 days prior written notice. The amount of outstanding third-party investments in our accounts receivable sold under this program was $152 million and $107 million at September 30, 2018 and December 31, 2017 , respectively. We also factor receivables in our European operations with regional banks in Europe under various separate facilities. The commitments for these arrangements are generally for one year , but some may be cancelled with notice 90 days prior to renewal. In some instances, the arrangement provides for cancellation by the applicable financial institution at any time upon notification. The amount of outstanding third-party investments in our accounts receivable sold under programs in Europe was $189 million and $218 million at September 30, 2018 and December 31, 2017 , respectively. Certain programs in Europe have deferred purchase price arrangements with the banks. We received cash to settle the deferred purchase price of factored receivables for $36 million and $28 million in the three month periods ended September 30, 2018 and 2017 , respectively, and $102 million and $77 million in the nine month periods ended September 30, 2018 and 2017 , respectively. The cash received to settle the deferred purchase price of factored receivables is included as part of our investing activities in the condensed consolidated statements of cash flows. If we were not able to securitize or factor our accounts receivable under either the U.S. or European programs, our borrowings under our revolving credit agreement might increase. These accounts receivable securitization and factoring programs provide us with access to cash at costs that are generally favorable to alternative sources of financing, and allow us to reduce borrowings under our revolving credit agreement. In one of our U.S. accounts receivable securitization programs, we transfer a partial interest in a pool of receivables and the interest that we retain is subordinate to the transferred interest. Accordingly, we account for our U.S. accounts receivable securitization program as a secured borrowing. In one U.S. program and our European accounts receivable factoring programs, we transfer accounts receivable to the acquiring entities and satisfy all of the conditions established under Accounting Standards Codification (ASC) Topic 860, Transfers and Servicing, to report the transfer of financial assets as a sale. The fair value of assets received as proceeds in exchange for the transfer of accounts receivable under the U.S. and European factoring programs approximates the fair value of such receivables. We recognized $1 million interest expense in each of the three month periods ended September 30, 2018 and 2017 , and $4 million and $ 3 million in the nine month periods ended September 30, 2018 and 2017 , respectively, relating to our U.S. accounts receivable securitization program. In addition, we recognized a loss of $2 million in each of the three month periods ended September 30, 2018 and 2017 , and $5 million and $4 million in the nine month periods ended September 30, 2018 and 2017 , respectively, on the sale of accounts receivable in our U.S. and European accounts receivable factoring programs, representing the discount from book values at which these receivables were sold to our banks. The remaining loss on receivables recognized in our condensed consolidated statements of income is unrelated to the aforementioned factoring programs. The discount rate varies based on funding costs incurred by our banks, which averaged approximately 2% during both the first nine months of 2018 and 2017 for the European programs and 3% during both the first nine months of 2018 and 2017 for the U.S. program. |
Restructuring and Other Charges
Restructuring and Other Charges | 9 Months Ended |
Sep. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Other Charges | Restructuring and Other Charges Restructuring and Other Charges Over the past several years, we have adopted plans to restructure portions of our operations. These plans were approved by our Board of Directors and were designed to reduce operational and administrative overhead costs throughout the business. In the third quarter of 2018, we incurred $12 million in restructuring and related costs, primarily related to the accelerated move of our Beijing Ride Performance plant, and other cost improvement initiatives. In the first nine months of 2018 , we incurred $55 million in restructuring and related costs, primarily related to the accelerated move of our Beijing Ride Performance plant, headcount reduction at a Clean Air manufacturing plant in Germany and other cost improvement initiatives. We expect all assembly to be relocated to the new China facility by the end of the year and the component manufacturing relocation to be complete during the first quarter of 2019. In the third quarter of 2017 , we incurred $20 million in restructuring and related costs, including asset write-downs of $1 million , primarily related to closing a Clean Air manufacturing plant and downsizing Ride Performance operations in Australia and other cost improvement initiatives. In the first nine months of 2017 , we incurred $52 million in restructuring and related costs, including asset write-downs of $3 million , primarily related to closing a Clean Air Belgian JIT plant in response to the end of production on a customer platform, closing a Clean Air manufacturing plant and downsizing Ride Performance operations in Australia and other cost improvement initiatives. The Company's restructuring and other charges are classified in the condensed consolidated statements of income as follows: Three Months Ended Nine Months Ended 2018 2017 2018 2017 (Millions) Cost of sales $ 12 $ 8 $ 44 $ 31 Engineering, research, and development — — 1 — Selling, general, and administrative — 11 10 18 Depreciation and amortization of other intangibles — 1 — 3 $ 12 $ 20 $ 55 $ 52 Other Structural Cost Reductions The Company has also been tracking other costs, unrelated to manufacturing operations, which are intended to support the achievement of Acquisition synergies. In the third quarter of 2018, these other costs were $4 million , of which $3 million was recorded in selling, general, and administrative and $1 million in other expense, net. In the first nine months of 2018, these other costs were $13 million , of which $8 million was recorded in selling, general, and administrative expenses, $4 million was recorded in engineering, research, and development and $1 million was recorded in other expense, net. Amounts related to activities that were charged to our restructuring reserves, including costs incurred to support future structural cost reductions, are as follows: December 31, 2018 2018 Impact of Exchange Rates September 30, 2018 (Millions) Employee severance, termination benefits and other related costs $ 25 $ 55 $ (47 ) $ (1 ) $ 32 Under the terms of our amended and restated senior credit agreement that took effect on May 12, 2017, we were allowed to exclude, at our discretion, (i) up to $35 million in 2017 and $ 25 million each year thereafter of cash restructuring charges and related expenses, with the ability to carry forward any amount not used in one year to the following year, and (ii) up to $150 million in the aggregate of all costs, expenses, fees, fines, penalties, judgments, legal settlements and other amounts associated with any restructuring, litigation, claim, proceeding or investigation related to or undertaken by us or any of our subsidiaries, together with any related provision for taxes, incurred for any quarterly period ending after May 12, 2017 in the calculation of the financial covenant ratios required under our senior credit facility. As of September 30, 2018 , we elected not to exclude any of the $106 million of allowable cash charges and related expenses recognized in the fourth quarter of 2017 and in the first nine months of 2018 for restructuring related costs and antitrust settlements against the $35 million annual limit for 2017, the $25 million limit for 2018 and the $150 million aggregate limit that was available under the terms of the senior credit facility. |
Environmental Matters, Litigati
Environmental Matters, Litigation and Product Warranties | 9 Months Ended |
Sep. 30, 2018 | |
Environmental Matters, Litigation and Product Warranties [Abstract] | |
Environmental Matters, Litigation and Product Warranties | Environmental Matters, Legal Proceedings and Product Warranties We are involved in environmental remediation matters, legal proceedings, claims (including warranty claims) and investigations. These matters are typically incidental to the conduct of our business and create the potential for contingent losses. We accrue for contingent losses when our review of available facts indicates that it is probable a loss has been incurred and the amount of the loss is reasonably estimable. Each quarter we assess our loss contingencies based upon currently available facts, existing technology, presently enacted laws and regulations and taking into consideration the likely effects of inflation and other societal and economic factors and record adjustments to these reserves as required. As an example, we consider all available evidence, including prior experience in remediation of contaminated sites, other companies’ cleanup experiences and data released by the U.S. Environmental Protection Agency or other organizations when we evaluate our environmental remediation contingencies. All of our loss contingency estimates are subject to revision in future periods based on actual costs or new information. With respect to our environmental liabilities, where future cash flows are fixed or reliably determinable, we have discounted those liabilities. We evaluate recoveries separately from the liability and, when they are assured, recoveries are recorded and reported separately from the associated liability in our consolidated financial statements. Environmental Matters We are subject to a variety of environmental and pollution control laws and regulations in all jurisdictions in which we operate. We expense or capitalize, as appropriate, expenditures for ongoing compliance with environmental regulations. As of September 30, 2018 , we have the obligation to remediate or contribute towards the remediation of certain sites, including one Federal Superfund site. Our aggregated estimated share of environmental remediation costs for all these sites on a discounted basis was approximately $17 million at September 30, 2018 , of which $3 million is recorded in other current liabilities and $14 million is recorded in deferred credits and other liabilities in our consolidated balance sheet. For those locations where the liability was discounted, the weighted-average discount rate used was 2.6 percent . The undiscounted value of the estimated remediation costs was $21 million . Our expected payments of environmental remediation costs are estimated to be approximately $2 million in 2018, $3 million in 2019, $1 million each year beginning 2020 through 2022 and $13 million in aggregate thereafter. Based on information known to us, we have established reserves that we believe are adequate for these costs. Although we believe these estimates of remediation costs are reasonable and are based on the latest available information, the costs are estimates and are subject to revision as more information becomes available about the extent of remediation required. At some sites, we expect that other parties will contribute to the remediation costs. In addition, certain environmental statutes provide that our liability could be joint and several, meaning that we could be required to pay in excess of our share of remediation costs. Our understanding of the financial strength of other potentially responsible parties at these sites has been considered, where appropriate, in our determination of our estimated liability. We do not believe that any potential costs associated with our current status as a potentially responsible party in the Federal Superfund site, or as a liable party at the other locations referenced herein, will be material to our consolidated financial position, results of operations, or liquidity. Antitrust Investigations and Litigation On March 25, 2014, representatives of the European Commission were at Tenneco GmbH's Edenkoben, Germany administrative facility to gather information in connection with an ongoing global antitrust investigation concerning multiple automotive suppliers. On March 25, 2014, we also received a related subpoena from the U.S. Department of Justice (“DOJ”). On November 5, 2014, the DOJ granted us conditional leniency pursuant to an agreement we entered into under the Antitrust Division's Corporate Leniency Policy. This agreement provides us with important benefits in exchange for our self-reporting of matters to the DOJ and our continuing full cooperation with the DOJ's resulting investigation. For example, the DOJ will not bring any criminal antitrust prosecution against us, nor seek any criminal fines or penalties, in connection with the matters we reported to the DOJ. Additionally, there are limits on our liability related to any follow-on civil antitrust litigation in the U.S. The limits include single rather than treble damages, as well as relief from joint and several antitrust liability with other relevant civil antitrust action defendants. These limits are subject to our satisfying the DOJ and any court presiding over such follow-on civil litigation. On April 27, 2017, the Company received notification from the European Commission (EC) that it has administratively closed its global antitrust inquiry regarding the production, assembly, and supply of complete exhaust systems. No charges against the Company or any other competitor were initiated at any time and the EC inquiry is now closed. Certain other competition agencies are also investigating possible violations of antitrust laws relating to products supplied by the Company. We have cooperated and continue to cooperate fully with all of these antitrust investigations, and take other actions to minimize our potential exposure. The Company and certain of its competitors are also currently defendants in civil putative class action litigation, and are subject to similar claims filed by other plaintiffs, in the United States and Canada. More related lawsuits may be filed, including in other jurisdictions. Plaintiffs in these cases generally allege that defendants have engaged in anticompetitive conduct, in violation of federal and state laws, relating to the sale of automotive exhaust systems or components thereof. Plaintiffs seek to recover, on behalf of themselves and various purported classes of purchasers, injunctive relief, damages and attorneys’ fees. However, as explained above, because we received conditional leniency from the DOJ, our civil liability in U.S. follow-on actions is limited to single damages and we will not be jointly and severally liable with the other defendants, provided that we have satisfied our obligations under the DOJ leniency agreement and approval is granted by the presiding court. Typically, exposure for follow-on actions in Canada is less than the exposure for U.S. follow-on actions. Following the EC’s decision to administratively close its antitrust inquiry into exhaust systems in 2017, the Company’s receipt of conditional leniency from the DOJ in 2014 and discussions during the third quarter of 2017 following the appointment of a special settlement master in the civil putative class action cases pending against the Company and/or certain of its competitors in the U.S., the Company continues to vigorously defend itself and/or take actions to minimize its potential exposure to matters pertaining to the global antitrust investigation, including engaging in settlement discussions when it is in the best interests of the Company and its stockholders. For example, in October 2017, the Company settled an administrative action brought by Brazil's competition authority for an amount that was not material. Additionally, in February 2018, the Company settled civil putative class action litigation in the United States brought by classes of direct purchasers, end-payors and auto dealers. No other classes of plaintiffs have brought claims against the Company in the United States. Based upon earlier developments, including settlement discussions, the Company established a reserve of $132 million in its second quarter 2017 financial results for settlement costs that were probable, reasonably estimable, and expected to be necessary to resolve the Company’s antitrust matters globally, which primarily involves the resolution of civil suits and related claims. Of the $132 million reserve that was established, $64 million has been paid through September 30, 2018 resulting in a remaining reserve of $68 million as of September 30, 2018 , which is recorded in other current liabilities. While the Company continues to cooperate with certain competition agencies investigating possible violations of antitrust laws relating to products supplied by the Company, and the Company may be subject to other civil lawsuits and/or related claims, no amount of this reserve is attributable to matters with the DOJ or the EC, and no such amount is expected based on current information. Our reserve for antitrust matters is based upon all currently available information and an assessment of the probability of events for those matters where the Company can make a reasonable estimate of the costs to resolve such outstanding matters. The Company’s estimate involves significant judgment, given the number, variety and potential outcomes of actual and potential claims, the uncertainty of future rulings and approvals by a court or other authority, the behavior or incentives of adverse parties or regulatory authorities, and other factors outside of the control of the Company. As a result, the Company’s reserve may change from time to time, and actual costs may vary. Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on current information, we do not expect that any such change in the reserve will have a material adverse impact on our annual consolidated financial position, results of operations or liquidity. Other Legal Proceedings, Claims and Investigations For many years we have been and continue to be subject to lawsuits initiated by claimants alleging health problems as a result of exposure to asbestos. Our current docket of active and inactive cases is less than 500 cases nationwide. A small number of claims have been asserted against one of our subsidiaries by railroad workers alleging exposure to asbestos products in railroad cars. The substantial majority of the remaining claims are related to alleged exposure to asbestos in our automotive products although a significant number of those claims appear also to involve occupational exposures sustained in industries other than automotive. We believe, based on scientific and other evidence, it is unlikely that claimants were exposed to asbestos by our former products and that, in any event, they would not be at increased risk of asbestos-related disease based on their work with these products. Further, many of these cases involve numerous defendants, with the number in some cases exceeding 100 defendants from a variety of industries. Additionally, in many cases the plaintiffs either do not specify any, or specify the jurisdictional minimum, dollar amount for damages. As major asbestos manufacturers and/or users continue to go out of business or file for bankruptcy, we may experience an increased number of these claims. We vigorously defend ourselves against these claims as part of our ordinary course of business. In future periods, we could be subject to cash costs or charges to earnings if any of these matters are resolved unfavorably to us. To date, with respect to claims that have proceeded sufficiently through the judicial process, we have regularly achieved favorable resolutions. Accordingly, we presently believe that these asbestos-related claims will not have a material adverse impact on our future consolidated financial position, results of operations or liquidity. We are also from time to time involved in other legal proceedings, claims or investigations. Some of these matters involve allegations of damages against us relating to environmental liabilities (including toxic tort, property damage and remediation), intellectual property matters (including patent, trademark and copyright infringement, and licensing disputes), personal injury claims (including injuries due to product failure, design or warning issues, and other product liability related matters), taxes, unclaimed property, employment matters, and commercial or contractual disputes, sometimes related to acquisitions or divestitures. Additionally, some of these matters involve allegations relating to legal compliance. While we vigorously defend ourselves against all of these legal proceedings, claims and investigations and take other actions to minimize our potential exposure, in future periods, we could be subject to cash costs or charges to earnings if any of these matters are resolved on unfavorable terms. Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on current information, including our assessment of the merits of the particular claim, except as described above under "Antitrust Investigations", we do not expect the legal proceedings, claims or investigations currently pending against us will have any material adverse impact on our consolidated financial position, results of operations or liquidity. Warranty Matters We provide warranties on some of our products. The warranty terms vary but range from one year up to limited lifetime warranties on some of our premium aftermarket products. Provisions for estimated expenses related to product warranty are made at the time products are sold or when specific warranty issues are identified with our products. These estimates are established using historical information about the nature, frequency, and average cost of warranty claims. We actively study trends of our warranty claims and take action to improve product quality and minimize warranty claims. We believe that the warranty reserve is appropriate; however, actual claims incurred could differ from the original estimates, requiring adjustments to the reserve. The reserve is included in both current and long-term liabilities on the condensed consolidated balance sheets. Below is a table that shows the activity in the warranty accrual accounts: Nine Months Ended 2018 2017 (Millions) Beginning Balance January 1, $ 26 $ 20 Accruals related to product warranties 13 13 Reductions for payments made (11 ) (8 ) Ending Balance September 30, $ 28 $ 25 |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Earnings per share of common stock outstanding were computed as follows: Three Months Ended Nine Months Ended 2018 2017 2018 2017 (Millions Except Share and Per Share Amounts) Basic earnings per share — Net income attributable to Tenneco Inc. $ 54 $ 83 $ 162 $ 139 Weighted average shares of common stock outstanding 51,272,618 52,508,078 51,247,664 53,265,149 Earnings per share of common stock $ 1.05 $ 1.57 $ 3.17 $ 2.61 Diluted earnings per share — Net income attributable to Tenneco Inc. $ 54 $ 83 $ 162 $ 139 Weighted average shares of common stock outstanding 51,272,618 52,508,078 51,247,664 53,265,149 Effect of dilutive securities: Restricted stock, PSUs and RSUs 93,956 89,666 95,022 106,320 Stock options 35,255 89,912 53,241 130,395 Weighted average shares of common stock outstanding including dilutive securities 51,401,829 52,687,656 51,395,927 53,501,864 Earnings per share of common stock $ 1.05 $ 1.57 $ 3.16 $ 2.60 As of September 30, 2018 and 2017 , the outstanding options to purchase shares of common stock that were not included in the computation of diluted earnings per share because they were anti-dilutive were 124,865 and 127,359 shares for the three months ended September 30, 2018 and 2017 , respectively, and 124,606 and 834 shares for the nine months ended September 30, 2018 and 2017 , respectively. |
Common Stock
Common Stock | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Common Stock | Common Stock Common Stock — As discussed in Note 2, Acquisition of Federal-Mogul, pursuant to the Amended and Restated Certificate of Incorporation, a new class of Class B Common Stock was created and the Company’s existing common stock was reclassified as Class A Common Stock. See Note 2, Acquisition of Federal-Mogul for additional information. Equity Plans — We have granted a variety of awards, including common stock, restricted stock, restricted stock units (RSUs), performance share units (PSUs), stock appreciation rights (SARs), and stock options to our directors, officers, and employees. Accounting Methods — Prior to 2018, for employees eligible to retire at grant date, we immediately expensed stock options and restricted stock. In 2018, we prospectively changed our vesting policy regarding retirement eligibility and now require a retirement eligible employee (or an employee who becomes retirement eligible) to provide at least one year of service from the grant date in order for the award to vest. If an employee becomes retirement eligible after the first year of vesting but before completion of the three-year term, we amortize the expense for the share-based awards over a period starting at the grant date to the date an employee becomes retirement eligible. Stock Options — There have been no stock options granted since 2014. There is no compensation expense in each of the three month periods ended September 30, 2018 and 2017 , and the nine month periods ended September 30, 2018 . There is less than $1 million of compensation expense (net of tax) for the nine month period ended September 30, 2017 related to nonqualified stock options, which was recorded in selling, general, and administrative expense. This had no impact on basic or diluted earnings per share for the three month periods ended September 30, 2018 and 2017 and nine month period ended September 30, 2018 and a decrease of less than $0.01 in both basic and diluted earnings per share for the nine month period ended September 30, 2017 . As of September 30, 2018 , there was no unrecognized compensation cost related to our stock option awards. Cash received from stock option exercises for the nine month periods ended September 30, 2018 and 2017 was less than $1 million and $7 million , respectively. Stock options exercised in the first nine months of 2018 and 2017 generated a tax benefit of less than $1 million and $2 million , respectively. The following table reflects the status and activity for all options to purchase common stock for the period indicated: Nine Months Ended September 30, 2018 Shares Weighted Avg. Weighted Avg. Aggregate (Millions) Outstanding Stock Options Outstanding, January 1, 2018 318,016 $ 43.60 2.6 $ 5 Exercised (4,607 ) 26.78 — Outstanding, March 31, 2018 313,409 43.84 2.1 4 Forfeited (2,368 ) 54.34 — Outstanding, June 30, 2018 311,041 43.76 1.8 2 Exercised (11,420 ) 29.93 — Outstanding, September 30, 2018 299,621 $ 44.29 2.4 $ 1 As mentioned above, there have been no stock options granted since 2014. Accordingly, no options vested during the nine month period ended September 30, 2018 . The total fair value of shares vested from options that were granted prior to 2015 for the nine month period ended September 30, 2017 was $2 million . Long-Term Performance Units, PSUs, RSUs and SARs — Long-term performance units, RSUs granted prior to 2018 and SARs are paid in cash (cash-settled awards) and recognized as a liability based upon their fair value. PSUs and RSUs granted in 2018 onward (share-settled RSUs) are settled in shares upon vesting and recognized in equity based on their fair value. As of September 30, 2018 , $3 million of total unrecognized compensation costs is expected to be recognized on the cash-settled awards over a weighted-average period of approximately 1.2 years. Compensation expense for restricted stock, RSUs, long-term performance units, PSUs and SARs (net of tax) was $3 million and $2 million for the three month periods ended September 30, 2018 and 2017 , respectively, and $7 million and $10 million for the nine month periods ended September 30, 2018 and 2017 , respectively, and was recorded in selling, general, and administrative expense. The following table reflects the status for all nonvested restricted shares, share-settled RSUs and PSUs for the period indicated: Restricted Shares Share-Settled RSUs PSUs Shares Weighted Avg. Shares Weighted Avg. Shares Weighted Avg. Nonvested balance at January 1, 2018 410,251 $ 49.95 — $ — — $ — Granted 17,440 55.05 253,257 55.02 214,348 50.75 Vested (168,409 ) 47.08 — — — — Forfeited (5,108 ) 48.68 (1,362 ) 55.04 — — Nonvested balance at March 31, 2018 254,174 52.23 251,895 55.02 214,348 50.75 Granted 1,573 47.97 16,995 47.17 25,957 35.64 Vested (60,434 ) 49.89 (192 ) 55.04 — — Forfeited (2,482 ) 57.15 (8,001 ) 55.04 (4,051 ) 50.75 Nonvested balance at June 30, 2018 192,831 53.14 260,697 54.51 236,254 49.28 Granted — — 14,903 42.22 8,623 32.24 Vested (6,443 ) 53.31 — — — — Forfeited (1,210 ) 62.79 (6,408 ) 55.04 (5,882 ) 50.75 Nonvested balance at September 30, 2018 185,178 $ 53.07 269,192 $ 57.51 238,995 $ 48.68 The fair value of restricted stock grants is equal to the average of the high and low trading price of our common stock on the date of grant. As of September 30, 2018 , approximately $4 million of total unrecognized compensation costs related to restricted stock awards is expected to be recognized over a weighted-average period of approximately 1.2 years. The total fair value of restricted shares vested was $11 million and $14 million at September 30, 2018 and 2017 , respectively. The fair value of share-settled RSU grants is equal to the average of the high and low trading price of our common stock on the date of the grant and vest ratably over a three -year period. As of September 30, 2018 , approximately $10 million of total unrecognized compensation costs related to share-settled RSUs is expected to be recognized over a weighted-average period of approximately 2.4 years. PSU grants are subject to service, market and performance conditions. PSU grants are valued based on the fair value of the high and low trading price of our common stock at grant date and at the end of a three -year period, if performance measures are met. As of September 30, 2018 , approximately $8 million of total unrecognized compensation costs related to PSUs is expected to be recognized over a weighted-average period of approximately 2.4 years. Share Repurchase Program — In January 2015, our Board of Directors approved a share repurchase program, authorizing our Company to repurchase up to $350 million of our outstanding common stock over a three year period. In October 2015, our Board of Directors expanded this share repurchase program, authorizing the repurchase of an additional $200 million of the Company's outstanding common stock. In February 2017, our Board of Directors authorized the repurchase of up to $400 million of the Company's outstanding common stock over the next three years, inclusive of $112 million that remained authorized under earlier repurchase programs. The Company anticipates acquiring the shares through open market or privately negotiated transactions, which will be funded from cash flow from operations. The repurchase program does not obligate the Company to repurchase shares within any specific time or situations, and opportunities in higher priority areas could affect the cadence of this program. We did not repurchase any shares through this program in the nine months ended September 30, 2018 . Since we announced the share repurchase program in January 2015, we have repurchased 11.3 million shares for $607 million through September 30, 2018 . Treasury shares were 14,592,888 shares at September 30, 2018 and December 31, 2017 , respectively. Dividends — On February 1, 2017, the Company announced the reinstatement of a quarterly dividend program under which we expect to pay quarterly dividends of $0.25 per share on our common stock, representing planned annual dividends of $1.00 per share. We paid a quarterly dividend of $0.25 per share in each of the first three quarters of 2017 and 2018. Dividends declared and paid were $39 million and $40 million in the nine month periods ended September 30, 2018 and 2017 , respectively. As a result of the Federal-Mogul transaction, and the resulting higher share count, the quarterly dividend payment will increase to $20 million beginning in the fourth quarter. In view of our current stock price and overall sector valuations, we will evaluate the best methodology to return this value to our shareholders. This may result in a change in the dividend and returning that capital via share buybacks in a comparable amount. |
Pension Plans, Postretirement a
Pension Plans, Postretirement and Other Employee Benefits | 9 Months Ended |
Sep. 30, 2018 | |
Retirement Benefits [Abstract] | |
Pension Plans, Postretirement and Other Employee Benefits | Pension Plans, Postretirement and Other Employee Benefits Net periodic pension and other postretirement benefit costs consist of the following components: Three Months Ended September 30, Pension Postretirement 2018 2017 2018 2017 U.S. Foreign U.S. Foreign U.S. U.S. (Millions) Service cost — benefits earned during the period $ 1 $ 3 $ 1 $ 3 $ — $ — Interest cost (a) 3 3 2 4 2 1 Expected return on plan assets (a) (4 ) (5 ) (4 ) (4 ) — — Net amortization: Actuarial loss (a) 1 2 1 1 2 2 Prior service cost (a) — — — 1 — — Net pension and postretirement costs $ 1 $ 3 $ — $ 5 $ 4 $ 3 Nine Months Ended September 30, Pension Postretirement 2018 2017 2018 2017 U.S. Foreign U.S. Foreign U.S. US (Millions) Service cost — benefits earned during the period $ 1 $ 8 $ 1 $ 7 $ — $ — Interest cost (a) 8 9 7 10 5 4 Expected return on plan assets (a) (11 ) (15 ) (11 ) (19 ) — — Settlement loss (a) — — 6 — — — Net amortization: Actuarial loss (a) 3 6 4 6 6 5 Prior service cost (credit) (a) — — — 1 (1 ) (1 ) Net pension and postretirement costs $ 1 $ 8 $ 7 $ 5 $ 10 $ 8 (a) Recorded in other expense, net. For the nine months ended September 30, 2018 , we made pension contributions of $1 million and $9 million for our domestic and foreign pension plans, respectively. Based on current actuarial estimates, we believe we will be required to contribute approximately $5 million for the remainder of 2018 for domestic and foreign plans. Pension contributions beyond 2018 will be required, but those amounts will vary based upon many factors including, for example, the performance of our pension fund investments during 2018 . We made postretirement contributions of approximately $6 million during the first nine months of 2018 . Based on current actuarial estimates, we believe we will be required to contribute approximately $3 million for the remainder of 2018 . In February 2016, the Company launched a voluntary program to buy out active employees and retirees who had earned benefits in the U.S. pension plans. This program was completed and all cash payments were made from pension plan assets to those who elected to take the buyout as of June 30, 2017. In connection with this program, the Company contributed $10 million into the pension trust and recognized a non-cash settlement loss of $6 million in the first quarter of 2017. The assets of some of our pension plans are invested in trusts that permit commingling of the assets of more than one employee benefit plan for investment and administrative purposes. Each of the plans participating in the trust has interests in the net assets of the underlying investment pools of the trusts. The investments for all our pension plans are recorded at estimated fair value, in compliance with the accounting guidance on fair value measurement. Amounts recognized for pension and postretirement benefits in other comprehensive income for the three and nine months ended September 30, 2018 and 2017 include the following components: Three Months Ended September 30, 2018 2017 Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax (Millions) Defined benefit pension and postretirement plans: Amortization of prior service cost included in net periodic pension and postretirement costs $ — $ — $ — $ 1 $ — $ 1 Amortization of actuarial loss included in net periodic pension and postretirement costs 5 (1 ) 4 4 (2 ) 2 Other comprehensive income – pension benefits $ 5 $ (1 ) $ 4 $ 5 $ (2 ) $ 3 Nine Months Ended September 30, 2018 2017 Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax (Millions) Defined benefit pension and postretirement plans: Amortization of prior service credit included in net periodic pension and postretirement costs $ (1 ) $ — $ (1 ) $ — $ — $ — Amortization of actuarial loss included in net periodic pension and postretirement costs 15 (3 ) 12 15 (5 ) 10 Settlement charge — — — 6 (2 ) 4 Other comprehensive income – pension benefits $ 14 $ (3 ) $ 11 $ 21 $ (7 ) $ 14 |
New Accounting Pronouncements
New Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements | ccounting Pronouncements Adoption of New Accounting Standards In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The new guidance improved the presentation of net periodic pension and postretirement benefit costs. We retrospectively adopted this standard in the first quarter of 2018. We recorded other pension and postretirement costs of $4 million and $10 million in other expense, net for the three and nine month periods ended September 30, 2018 , respectively. Prior to adoption, this amount would have been recorded in selling, general, and administrative expenses and cost of sales in the condensed consolidated statements of income. Prior year net pension and postretirement costs of $3 million and $10 million for the three and nine month periods ended September 30, 2017 , respectively, have been reclassified from selling, general, and administrative expenses and cost of sales to other expense, net to conform to the current year presentation. Of the $10 million adjustment for the nine month period ended September 30, 2017 , $6 million was a non-cash charge related to a voluntary program to buy out active employees and retirees who had earned benefits in the U.S. pension plans. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows - Restricted Cash (Topic 230) to eliminate diversity in practice in the presentation of restricted cash and restricted cash equivalents in the statement of cash flows. We retrospectively adopted this standard in the first quarter of 2018 with no material impact. Prior year amounts have been reclassified to conform to current year presentation. In October 2016, the FASB issued ASU 2016-16, Income Taxes - Intra Entity Transfers of Assets Other Than Inventory (Topic 740). The standard changed the accounting for income taxes when a company transfers certain tangible and intangible assets, such as equipment or intellectual property, between entities in different tax jurisdictions. The standard did not change the current accounting for the income taxes related to transfers of inventory. We adopted this standard on January 1, 2018 using the modified retrospective method. The cumulative effect of the adoption was recognized as an increase to accumulated deficit of $2 million . In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows - Classification of certain cash receipts and cash payments (Topic 230). This update addressed eight specific cash flow issues with the objective of reducing the diversity in practice. We retrospectively adopted this standard in the first quarter of 2018. We recorded $36 million and $102 million as an investing activity in the condensed consolidated statements of cash flows for the cash we received to settle the deferred purchase price of factored receivables for the three and nine month periods ended September 30, 2018 , respectively. Prior to adoption, this amount would have been recorded as an operating activity. Prior period amounts of $28 million and $77 million for the three and nine month periods ended September 30, 2017 , respectively, have been reclassified from operating to investing activities to conform to the current year presentation. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), an amendment on revenue recognition. The amendment in this update created Topic 606, Revenue from Contracts with Customers, and superseded the revenue recognition requirements in Topic 605, Revenue Recognition, including most industry-specific revenue recognition guidance throughout the industry topics of the codification. In addition, the amendment superseded the cost guidance in Subtopic 605-35, Revenue Recognition-Construction-Type and Production-Type Contracts, and created a new Subtopic 340-40, Other Assets and Deferred Costs-Contracts with Customers. The core principle of Topic 606 is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We adopted Topic 606 on January 1, 2018, using the modified retrospective method. The cumulative effect of the adoption was recognized as a decrease to accumulated deficit of $1 million on January 1, 2018. Please refer to Note 15, Revenue for further discussion of the adoption of this standard. Accounting Standards Issued But Not Yet Adopted In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in this update. The amendments in this update are effective for interim and annual periods for the Company beginning on January 1, 2020, with early adoption permitted. The amendments in this update should be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. We are currently evaluating the potential impact of this new guidance on the Company's consolidated financial statements. In August 2018, the FASB issued ASU 2018-14, Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20). The amendments in this update remove disclosures that no longer are considered cost beneficial, clarify the specific requirements of disclosures, and add disclosure requirements identified as relevant. Although narrow in scope, the amendments are considered an important part of the Board's efforts to improve the effectiveness of disclosures in the notes to financial statements by applying concepts in the concepts statement. The amendments in this update are effective for fiscal years ending after December 15, 2020 with early adoption permitted. We are currently evaluating the potential impact of this new guidance on the Company's consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820). The new guidance modifies disclosure requirements related to fair value measurement. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Implementation on a prospective or retrospective basis varies by specific disclosure requirement. Early adoption is permitted. The standard also allows for early adoption of any removed or modified disclosures upon issuance of this ASU while delaying adoption of the additional disclosures until their effective date. In February 2018, the FASB issued ASU 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220). The amendments in this update allow a reclassification from accumulated other comprehensive income to accumulated deficit for stranded tax effects resulting from the Tax Cuts and Jobs Act. Consequently, the amendments allow for an election to eliminate the stranded tax effects resulting from the Tax Cuts and Jobs Act and will improve the usefulness of information reported to financial statement users. However, because the amendments only relate to the reclassification of the income tax effects of the Tax Cuts and Jobs Act, the underlying guidance that requires the effect of a change in tax laws or rates be included in income from continuing operations is not affected. The amendments in this update also require certain disclosures about stranded tax effects. The amendments in this update are effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. We are currently evaluating the potential impact of this new guidance on the Company's consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This update supersedes the lease requirements in Topic 840, Leases. The objective of Topic 842 is to establish the principles that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flow arising from a lease. For public business entities, the standard is effective for financial statements issued for annual periods beginning after December 15, 2018, and interim periods within those annual periods. We will adopt this amendment on January 1, 2019. We are currently undertaking a process to quantify the impact that this standard will have on our condensed consolidated financial statements, including reviewing our lease arrangements, as well as working through system implementation steps and assessing our procedural and policy requirements. At a minimum, in the period the ASU is adopted, total assets and total liabilities will increase in the condensed consolidated balance sheet as a result of recognizing right-of-use assets and liabilities for our operating lease obligations. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information In the first quarter of 2018, the Company revised its reportable segments to consist of the following three segments: Clean Air, Ride Performance and Aftermarket. The new reportable segments, which are also the Company's operating segments, align with how the Chief Operating Decision Maker allocates resources and assesses performance against the Company’s key growth strategies. Costs related to other business activities, primarily corporate headquarter functions, are disclosed separately from the three operating segments as "Other." We evaluate segment performance based primarily on earnings before interest expense, income taxes, and noncontrolling interests. Products are transferred between segments and geographic areas on a basis intended to reflect as nearly as possible the “market value” of the products. Prior period segment information has been retrospectively revised to reflect our current segmentation. These changes also resulted in changes to the Company's reporting units. The Company allocated goodwill to its new reporting units in the first quarter of 2018, using a relative fair value approach, assessed potential goodwill impairment for all reporting units immediately before and immediately after the reallocation, and determined that no impairment existed. The following table summarizes certain of the Company's segment information: Segments Clean Air Ride Performance Aftermarket Total Other Reclass & Elims Total (Millions) At September 30, 2018 and for the Three Months Ended September 30, 2018 Revenues from external customers $ 1,602 $ 461 $ 309 $ 2,372 $ — $ — $ 2,372 Intersegment revenues 14 16 12 42 — (42 ) — EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests 104 (5 ) 45 144 (40 ) — 104 Total assets 3,008 1,079 885 4,972 — 56 5,028 At September 30, 2017 and for the Three Months Ended September 30, 2017 Revenues from external customers $ 1,495 $ 457 $ 322 $ 2,274 $ — $ — $ 2,274 Intersegment revenues 11 18 8 37 — (37 ) — EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests 100 7 50 157 (23 ) — 134 Total assets 2,912 1,100 864 4,876 — 59 4,935 At September 30, 2018 and for the Nine Months Ended September 30, 2018 Revenues from external customers $ 5,052 $ 1,480 $ 951 $ 7,483 $ — $ — $ 7,483 Intersegment revenues 42 45 35 122 — (122 ) — EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests 328 8 130 466 (132 ) — 334 Total assets 3,008 1,079 885 4,972 — 56 5,028 At September 30, 2017 and for the Nine Months Ended September 30, 2017 Revenues from external customers $ 4,589 $ 1,327 $ 967 $ 6,883 $ — $ — $ 6,883 Intersegment revenues 53 46 29 128 — (128 ) — EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests 300 52 146 498 (216 ) — 282 Total assets 2,912 1,100 864 4,876 — 59 4,935 |
Supplemental Guarantor Condense
Supplemental Guarantor Condensed Consolidating Financial Statements | 9 Months Ended |
Sep. 30, 2018 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Supplemental Guarantor Condensed Consolidating Financial Statements | Supplemental Guarantor Condensed Consolidating Financial Statements Basis of Presentation As of September 30, 2018, substantially all of our existing and future material domestic 100% owned subsidiaries (which are referred to as the Guarantor Subsidiaries) fully and unconditionally guarantee our senior notes due in 2024 and 2026 on a joint and several basis. However, a subsidiary’s guarantee may be released in certain customary circumstances such as a sale of the subsidiary or all or substantially all of its assets in accordance with the indenture applicable to the notes. The Guarantor Subsidiaries are combined in the presentation below. These consolidating financial statements are presented on the equity method. Under this method, our investments are recorded at cost and adjusted for our ownership share of a subsidiary’s cumulative results of operations, capital contributions and distributions, and other equity changes. You should read the condensed consolidating financial information of the Guarantor Subsidiaries in connection with our condensed consolidated financial statements and related notes of which this note is an integral part. Distributions There are no significant restrictions on the ability of the Guarantor Subsidiaries to make distributions to us. STATEMENT OF COMPREHENSIVE INCOME Three Months Ended September 30, 2018 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Revenues Net sales and operating revenues — External $ 990 $ 1,382 $ — $ — $ 2,372 Affiliated companies 145 152 — (297 ) — 1,135 1,534 — (297 ) 2,372 Costs and expenses Cost of sales (exclusive of depreciation and amortization shown below) 962 1,349 — (297 ) 2,014 Engineering, research, and development 20 19 — — 39 Selling, general, and administrative 67 74 — — 141 Depreciation and amortization of other intangibles 30 35 — — 65 1,079 1,477 — (297 ) 2,259 Other expense (income) Loss on sale of receivables 1 2 — — 3 Other expense (income) 10 (10 ) — 6 6 11 (8 ) — 6 9 Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies 45 65 — (6 ) 104 Interest expense — External (net of interest capitalized) 9 2 10 — 21 Affiliated companies (net of interest income) (4 ) — 4 — — Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies 40 63 (14 ) (6 ) 83 Income tax expense 10 10 — — 20 Equity in net income from affiliated companies 38 — 68 (106 ) — Net income 68 53 54 (112 ) 63 Less: Net income attributable to noncontrolling interests — 9 — — 9 Net income attributable to Tenneco Inc. $ 68 $ 44 $ 54 $ (112 ) $ 54 Comprehensive income attributable to Tenneco Inc. $ 68 $ 44 $ 30 $ (112 ) $ 30 STATEMENT OF COMPREHENSIVE INCOME Three Months Ended September 30, 2017 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Revenues Net sales and operating revenues — External $ 917 $ 1,357 $ — $ — $ 2,274 Affiliated companies 128 143 — (271 ) — 1,045 1,500 — (271 ) 2,274 Costs and expenses Cost of sales (exclusive of depreciation and amortization shown below) 887 1,295 — (271 ) 1,911 Engineering, research, and development 17 23 — — 40 Selling, general, and administrative 50 77 — — 127 Depreciation and amortization of other intangibles 23 35 — — 58 977 1,430 — (271 ) 2,136 Other expense (income) Loss on sale of receivables 1 1 — — 2 Other expense (income) 12 (10 ) — — 2 13 (9 ) — — 4 Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies 55 79 — — 134 Interest expense — External (net of interest capitalized) 7 2 10 — 19 Affiliated companies (net of interest income) (5 ) 3 2 — — Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies 53 74 (12 ) — 115 Income tax (benefit) expense (5 ) 21 — — 16 Equity in net income from affiliated companies 31 — 95 (126 ) — Net income 89 53 83 (126 ) 99 Less: Net income attributable to noncontrolling interests — 16 — — 16 Net income attributable to Tenneco Inc. $ 89 $ 37 $ 83 $ (126 ) $ 83 Comprehensive income attributable to Tenneco Inc. $ 89 $ 31 $ 114 $ (120 ) $ 114 STATEMENT OF COMPREHENSIVE INCOME Nine Months Ended September 30, 2018 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Revenues Net sales and operating revenues — External $ 3,050 $ 4,433 $ — $ — $ 7,483 Affiliated companies 402 464 — (866 ) — 3,452 4,897 — (866 ) 7,483 Costs and expenses Cost of sales (exclusive of depreciation and amortization shown below) 2,956 4,281 — (866 ) 6,371 Engineering, research, and development 57 65 — — 122 Selling, general, and administrative 222 228 — — 450 Depreciation and amortization of other intangibles 74 109 — — 183 3,309 4,683 — (866 ) 7,126 Other expense (income) Loss on sale of receivables 5 3 — — 8 Other expense (income) 40 (41 ) — 16 15 45 (38 ) — 16 23 Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies 98 252 — (16 ) 334 Interest expense — External (net of interest capitalized) 25 7 29 — 61 Affiliated companies (net of interest income) (11 ) — 11 — — Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies 84 245 (40 ) (16 ) 273 Income tax expense 9 63 — — 72 Equity in net income from affiliated companies 122 — 202 (324 ) — Net income 197 182 162 (340 ) 201 Less: Net income attributable to noncontrolling interests — 39 — — 39 Net income attributable to Tenneco Inc. $ 197 $ 143 $ 162 $ (340 ) $ 162 Comprehensive income attributable to Tenneco Inc. $ 197 $ 143 $ 71 $ (340 ) $ 71 STATEMENT OF COMPREHENSIVE INCOME Nine Months Ended September 30, 2017 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Revenues Net sales and operating revenues — External $ 2,958 $ 3,925 $ — $ — $ 6,883 Affiliated companies 413 497 — (910 ) — 3,371 4,422 — (910 ) 6,883 Costs and expenses Cost of sales (exclusive of depreciation and amortization shown below) 2,865 3,834 — (910 ) 5,789 Engineering, research, and development 56 59 — — 115 Selling, general, and administrative 301 219 — — 520 Depreciation and amortization of other intangibles 65 100 — — 165 3,287 4,212 — (910 ) 6,589 Other expense (income) Loss on sale of receivables 2 2 — — 4 Other expense (income) 24 (31 ) — 15 8 26 (29 ) — 15 12 Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies 58 239 — (15 ) 282 Interest expense — External (net of interest capitalized) 10 4 40 — 54 Affiliated companies (net of interest income) (12 ) 6 6 — — Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies 60 229 (46 ) (15 ) 228 Income tax expense 6 35 — — 41 Equity in net income from affiliated companies 119 — 185 (304 ) — Net income 173 194 139 (319 ) 187 Less: Net income attributable to noncontrolling interests — 48 — — 48 Net income attributable to Tenneco Inc. $ 173 $ 146 $ 139 $ (319 ) $ 139 Comprehensive income attributable to Tenneco Inc. $ 173 $ 140 $ 234 $ (313 ) $ 234 BALANCE SHEET September 30, 2018 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) ASSETS Current assets: Cash and cash equivalents $ 5 $ 197 $ — $ — $ 202 Restricted cash — 1 — — 1 Receivables, net 434 1,707 — (733 ) 1,408 Inventories 414 542 — — 956 Prepayments and other 139 230 — — 369 Total current assets 992 2,677 — (733 ) 2,936 Other assets: Investment in affiliated companies 1,385 — 1,357 (2,742 ) — Notes and advances receivable from affiliates 801 20,907 4,180 (25,888 ) — Long-term receivables, net 12 — — — 12 Goodwill 22 25 — — 47 Intangibles, net 5 15 — — 20 Deferred income taxes 171 56 — — 227 Other 63 91 — — 154 2,459 21,094 5,537 (28,630 ) 460 Plant, property, and equipment, at cost 1,564 2,504 — — 4,068 Less — Accumulated depreciation and amortization (978 ) (1,458 ) — — (2,436 ) 586 1,046 — — 1,632 Total assets $ 4,037 $ 24,817 $ 5,537 $ (29,363 ) $ 5,028 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Short-term debt (including current maturities of long-term debt): Short-term debt — non-affiliated $ — $ 225 $ 15 $ — $ 240 Short-term debt — affiliated 458 157 — (615 ) — Accounts payable 724 1,157 — (112 ) 1,769 Accrued taxes 4 34 — — 38 Other 210 232 9 (6 ) 445 Total current liabilities 1,396 1,805 24 (733 ) 2,492 Long-term debt: Long-term debt — non-affiliated 580 9 715 — 1,304 Long-term debt — affiliated 1,061 20,766 4,061 (25,888 ) — Deferred income taxes — 11 — — 11 Pension, postretirement benefits and other liabilities 298 120 — — 418 Total liabilities 3,335 22,711 4,800 (26,621 ) 4,225 Redeemable noncontrolling interests — 28 — — 28 Tenneco Inc. shareholders’ equity 702 2,040 737 (2,742 ) 737 Noncontrolling interests — 38 — — 38 Total equity 702 2,078 737 (2,742 ) 775 Total liabilities, redeemable noncontrolling interests and equity $ 4,037 $ 24,817 $ 5,537 $ (29,363 ) $ 5,028 BALANCE SHEET December 31, 2017 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) ASSETS Current assets: Cash and cash equivalents $ 7 $ 308 $ — $ — $ 315 Restricted cash — 3 — — 3 Receivables, net 402 1,567 — (648 ) 1,321 Inventories 383 486 — — 869 Prepayments and other 99 192 — — 291 Total current assets 891 2,556 — (648 ) 2,799 Other assets: Investment in affiliated companies 1,389 — 1,258 (2,647 ) — Notes and advances receivable from affiliates 791 19,119 3,967 (23,877 ) — Long-term receivables, net 8 1 — — 9 Goodwill 22 27 — — 49 Intangibles, net 5 17 — — 22 Deferred income taxes 161 43 — — 204 Other 66 78 — — 144 2,442 19,285 5,225 (26,524 ) 428 Plant, property, and equipment, at cost 1,478 2,530 — — 4,008 Less — Accumulated depreciation and amortization (934 ) (1,459 ) — — (2,393 ) 544 1,071 — — 1,615 Total assets $ 3,877 $ 22,912 $ 5,225 $ (27,172 ) $ 4,842 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Short-term debt (including current maturities of long-term debt): Short-term debt — non-affiliated $ — $ 83 $ — $ — $ 83 Short-term debt — affiliated 408 148 — (556 ) — Accounts payable 562 1,232 — (89 ) 1,705 Accrued taxes 8 37 — — 45 Other 203 221 12 (3 ) 433 Total current liabilities 1,181 1,721 12 (648 ) 2,266 Long-term debt: Long-term debt — non-affiliated 632 12 714 — 1,358 Long-term debt — affiliated 1,093 18,981 3,803 (23,877 ) — Deferred income taxes — 11 — — 11 Pension, postretirement benefits and other liabilities 296 127 — — 423 Total liabilities 3,202 20,852 4,529 (24,525 ) 4,058 Redeemable noncontrolling interests — 42 — — 42 Tenneco Inc. shareholders’ equity 675 1,972 696 (2,647 ) 696 Noncontrolling interests — 46 — — 46 Total equity 675 2,018 696 (2,647 ) 742 Total liabilities, redeemable noncontrolling interests and equity $ 3,877 $ 22,912 $ 5,225 $ (27,172 ) $ 4,842 STATEMENT OF CASH FLOWS Three Months Ended September 30, 2018 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Operating Activities Net cash provided (used) by operating activities $ 111 $ (145 ) $ (4 ) $ (3 ) $ (41 ) Investing Activities Proceeds from sale of assets — 1 — — 1 Cash payments for plant, property, and equipment (29 ) (49 ) — — (78 ) Cash payments for software related intangible assets (1 ) (2 ) — — (3 ) Proceeds from deferred purchase price of factored receivables — 36 — — 36 Other (4 ) — — — (4 ) Net cash used by investing activities (34 ) (14 ) — — (48 ) Financing Activities Repurchase of common shares — — (1 ) — (1 ) Cash dividends — — (14 ) — (14 ) Payments of long-term debt (5 ) — — — (5 ) Net increase in bank overdrafts — 2 — — 2 Net (decrease) increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable (243 ) 164 2 — (77 ) Net increase in short-term borrowings secured by accounts receivable 170 — — — 170 Intercompany dividend payments and net increase (decrease) in intercompany obligations 4 (24 ) 17 3 — Distributions to noncontrolling interest partners — (16 ) — — (16 ) Net cash (used) provided by financing activities (74 ) 126 4 3 59 Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash — (4 ) — — (4 ) Increase (decrease) in cash, cash equivalents and restricted cash 3 (37 ) — — (34 ) Cash, cash equivalents and restricted cash, July 1 3 234 — — 237 Cash, cash equivalents and restricted cash, September 30 (Note) $ 6 $ 197 $ — $ — $ 203 Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase. STATEMENT OF CASH FLOWS Three Months Ended September 30, 2017 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Operating Activities Net cash provided (used) by operating activities $ 39 $ (2 ) $ (8 ) $ (4 ) $ 25 Investing Activities Cash payments for plant, property, and equipment (29 ) (61 ) — — (90 ) Cash payments for software related intangible assets (4 ) (1 ) — — (5 ) Proceeds from deferred purchase price of factored receivables — 28 — — 28 Other (1 ) — — — (1 ) Net cash used by investing activities (34 ) (34 ) — — (68 ) Financing Activities Issuance of common shares — — 1 — 1 Cash dividends — — (14 ) — (14 ) Payments of long-term debt — (1 ) — — (1 ) Purchase of common stock under the share repurchase program — — (71 ) — (71 ) Net decrease in bank overdrafts — (3 ) — — (3 ) Net increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable 82 2 — — 84 Intercompany dividend payments and net (decrease) increase in intercompany obligations (87 ) (9 ) 92 4 — Distributions to noncontrolling interest partners — (12 ) — — (12 ) Net cash (used) provided by financing activities (5 ) (23 ) 8 4 (16 ) Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash — 3 — — 3 Decrease in cash, cash equivalents and restricted cash — (56 ) — — (56 ) Cash, cash equivalents and restricted cash, July 1 4 331 — — 335 Cash, cash equivalents and restricted cash, September 30 (Note) $ 4 $ 275 $ — $ — $ 279 Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase. STATEMENT OF CASH FLOWS Nine Months Ended September 30, 2018 Guarantor Nonguarantor Tenneco Inc. Reclass Consolidated (Millions) Operating Activities Net cash provided (used) by operating activities $ 190 $ (132 ) $ (9 ) $ (12 ) $ 37 Investing Activities Proceeds from sale of assets 1 5 — — 6 Cash payments for plant, property, and equipment (100 ) (142 ) — — (242 ) Cash payments for software related intangible assets (7 ) (6 ) — — (13 ) Proceeds from deferred purchase price of factored receivables — 102 — — 102 Other (2 ) — — — (2 ) Net cash used by investing activities (108 ) (41 ) — — (149 ) Financing Activities Repurchase of common shares — — (2 ) — (2 ) Cash dividends — — (39 ) — (39 ) Payments of long-term debt (14 ) (3 ) — — (17 ) Debt issuance cost for long-term debt (2 ) — — — (2 ) Net decrease in bank overdrafts — (5 ) — — (5 ) Net (decrease) increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable (189 ) 144 16 — (29 ) Net increase in short-term borrowings secured by accounts receivable 150 — — — 150 Intercompany dividend payments and net (decrease) increase in intercompany obligations (28 ) (18 ) 34 12 — Distributions to noncontrolling interest partners — (44 ) — — (44 ) Net cash (used) provided by financing activities (83 ) 74 9 12 12 Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash — (15 ) — — (15 ) Decrease in cash, cash equivalents and restricted cash (1 ) (114 ) — — (115 ) Cash, cash equivalents and restricted cash, January 1 7 311 — — 318 Cash, cash equivalents and restricted cash, September 30 (Note) $ 6 $ 197 $ — $ — $ 203 Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase. STATEMENT OF CASH FLOWS Nine Months Ended September 30, 2017 Guarantor Nonguarantor Tenneco Inc. Reclass Consolidated (Millions) Operating Activities Net cash provided (used) by operating activities $ 102 $ 24 $ (29 ) $ (11 ) $ 86 Investing Activities Proceeds from sale of assets 3 3 — — 6 Proceeds from sale of equity interest — 9 — — 9 Cash payments for plant, property, and equipment (110 ) (173 ) — — (283 ) Cash payments for software related intangible assets (10 ) (7 ) — — (17 ) Proceeds from deferred purchase price of factored receivables — 77 — — 77 Other (5 ) — — — (5 ) Net cash used by investing activities (122 ) (91 ) — — (213 ) Financing Activities Repurchase of common shares — — (2 ) — (2 ) Cash dividends — — (40 ) — (40 ) Payments of long-term debt — (3 ) (6 ) — (9 ) Issuance of long-term debt 400 — (264 ) — 136 Debt issuance cost for long-term debt (8 ) — — — (8 ) Purchase of common stock under the share repurchase program — — (131 ) — (131 ) Net decrease in bank overdrafts — (12 ) — — (12 ) Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivables 451 16 (323 ) — 144 Net increase in short-term borrowings secured by accounts receivables — — 20 — 20 Intercompany dividend payments and net (decrease) increase in intercompany obligations (828 ) 42 775 11 — Distributions to noncontrolling interest partners — (45 ) — — (45 ) Net cash provided (used) by financing activities 15 (2 ) 29 11 53 Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash — 4 — — 4 Decrease in cash, cash equivalents and restricted cash (5 ) (65 ) — — (70 ) Cash, cash equivalents and restricted cash, January 1 9 340 — — 349 Cash, cash equivalents and restricted cash, September 30 (Note) $ 4 $ 275 $ — $ — $ 279 Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue In May 2014, the FASB issued ASU 2014-09, an amendment on revenue recognition. The amendment created Topic 606, Revenue from Contracts with Customers, and supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition, including most industry-specific revenue recognition guidance throughout the industry topics of the codification. In addition, the amendment supersedes the cost guidance in Subtopic 605-35, Revenue Recognition-Construction-Type and Production-Type Contracts, and created new Subtopic 340-40, Other Assets and Deferred Costs-Contracts with Customers. The core principle of ASC Topic 606 is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We adopted ASC Topic 606, Revenue from Contracts with Customers, and all the related amendments ("new revenue standard") on January 1, 2018, using the modified retrospective method. The cumulative effect of the adoption was recognized as decrease to accumulated deficit of $1 million and the changes made to our consolidated January 1, 2018 opening balance sheet for the adoption of ASC Topic 606 were as follows: Balance at December 31, 2017 Adjustments due to ASU 2014-09 Adjustments due to ASU 2016-16 (a) Balance at January 1, 2018 (Millions) Consolidated Balance Sheet Assets Inventory $ 869 $ (5 ) $ — $ 864 Prepayments and other (including contract assets) 291 6 — 297 Equity Accumulated deficit (946 ) 1 (2 ) (947 ) (a) Cumulative effect of adopting ASU 2016-16, Income Taxes - Intra Entity Transfers of Assets Other Than Inventory (Topic 740). See Note 12, New Accounting Pronouncements for further information. Revenue from Contracts with Customers We account for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. While the majority of the contracts we enter into with original equipment (“OE”) and aftermarket customers are long-term supply arrangements, the performance obligations are established by the enforceable contract, which is generally considered to be the purchase order but in some cases could be the delivery release schedule. The purchase order, or related delivery release schedule, is of a duration of less than one year. As such, the Company applies the practical expedient in ASC paragraph 606-10-50-14 and does not disclose information about remaining performance obligations that have original expected durations of one year or less, for which work has not yet been performed. Certain taxes assessed by governmental authorities on revenue producing transactions, such as value added taxes, are excluded from revenue and recorded on a net basis. Performance Obligations The Company generates revenue through the design, manufacture, and sale of clean air and ride performance systems and products for light vehicle, commercial truck, off-highway and other applications. We recognize revenue for sales to our OE and aftermarket customers when transfer of control of the related good or service has occurred. Revenue from most of OE and aftermarket goods and services is transferred to customers occurs at a point in time. Contract terms with certain of our OE customers results in products and services being transferred over time due to the customized nature of some of our products together with contractual provisions in certain of our customer contracts that provide us with an enforceable right to payment for performance completed to date. Under typical terms, we do not have the right to consideration until the time of shipment from our plants or distribution center or the time of delivery to our customers. The timing of revenue recognition from products transferred to customers over time may be slightly accelerated compared to our right to consideration at the time of shipment or delivery. We invoice the customer once transfer of control has occurred and we have a right to payment. Our typical payment terms vary based on the customer and the type of goods and services in the contract. The period of time between invoicing and when payment is due is not significant. Amounts billed and due from our customers are classified as receivables on the condensed consolidated balance sheet. As our standard payment terms are less than one year, we have elected the practical expedient under ASC paragraph 606-10-32-18 to not assess whether a contract has a significant financing component. Original Equipment In a typical arrangement with an OE customer, purchase orders are issued for pre-production activities, which consist of engineering, design and development, tooling, and prototypes for the manufacture and delivery of component parts. We have concluded that these activities are not in the scope of ASC Topic 606 and for that reason, the Company has not made any changes to how it accounts for reimbursable pre-production costs, currently accounted for as a cost reduction. Generally, in connection with the sale of exhaust systems to certain OE manufacturers, we purchase catalytic converters and diesel particulate filters or components thereof including precious metals (“substrates”) on behalf of our customers which are used in the assembled system. These substrates are included in our inventory and are “passed through” to the customer at our cost, plus a small margin. Since we take title to the substrate inventory and have responsibility for both the delivery and quality of the finished product including the substrates, the revenues and related expenses are recorded at gross amounts. Revenues recognized for substrate sales were $596 million and $522 million for the three month periods ended September 30, 2018 and 2017 , respectively, and $1,869 million and $1,610 million for the nine month periods ended September 30, 2018 and 2017 , respectively. Due to the highly customized nature of certain finished components for our OE customers, revenue is recognized over time, consistent with the transfer of control of an asset with limited alternative use, and the Company having an enforceable right to payment for performance completed to date. We consider an input measure (e.g., costs incurred to date relative to total estimated costs at completion) as a fair measure of progress for the recognition of over time revenue associated with these customized parts. A cost measure best depicts the means of transfer of goods to the customer, which occurs as we incur costs to fulfill contracts. Total revenue recognized over time for such customized parts totaled less than $1 million and $2 million for the three and nine month periods ended September 30, 2018 , respectively. Prices for our OE customer base are generally fixed on the purchase order and allocation of consideration between goods and services is rare as the highly customized parts are considered sold at their standalone selling price. If an occasion arose whereby a finished component was not deemed sold at its standalone selling price, consideration would be allocated among different performance obligations based on an estimate, most likely cost plus margin, of the standalone selling price of each distinct good or service in the contract. Aftermarket Our aftermarket customers take delivery of finished components, which are recognized as revenue at the time the customer takes possession, which is usually at the time of shipment. This determination is based on applicable shipping terms as well as the consideration of other indicators, including timing of when the Company has a present right to payment, when physical possession of products is transferred to customers, when the customer has the significant risks and rewards of ownership of the asset, and any provisions in contracts regarding customer acceptance. While unit prices are generally fixed, for certain of our aftermarket customers, we provide for variable consideration, typically in the form of promotional incentives and returns at the time of sale. Expected values are based upon the contractual terms of the incentives and historical experience with returns. In most cases, we are able to derive the expected value of variable consideration at a level to conclude it is probable that a significant revenue reversal will not occur in future periods. In cases where the high threshold for recognition is not established, such amounts will be constrained and recognized when the uncertainty underlying the constraint is resolved. Certain aftermarket contracts with customers include terms and conditions that provide for inventory adjustments that result in a customer right of return that should be accounted for on a gross basis. For these contracts we have recorded a refund liability and inventory return asset. Contract Balances Contract assets primarily relate to the Company’s rights to consideration for work completed but not billed at the reporting date on contracts with customers. The contract assets are transferred to the receivables when the rights become unconditional. Contract liabilities primarily relate to contracts where advance payments or deposits have been received, but performance obligations have not yet been met, and therefore, revenue has not been recognized. The Company applies the practical expedient in ASC paragraph 606-10-50-14 and does not disclose information about the remaining performance obligations that have original expected durations of one year or less. Disaggregation of revenue Revenue from contracts with customers is disaggregated by product lines, as it depicts the nature and amount of the Company’s revenue that is aligned with the Company's key growth strategies. In the following table, revenue is disaggregated accordingly: Three Months Ended Nine Months Ended Total Revenues Substrate Sales Value-add Revenues Total Revenues Substrate Sales Value-add Revenues (Millions) (Millions) Clean Air $ 1,602 $ 596 $ 1,006 $ 5,052 $ 1,869 $ 3,183 Ride Performance 461 — 461 1,480 — 1,480 Aftermarket 309 — 309 951 — 951 Total Tenneco Inc. $ 2,372 $ 596 $ 1,776 $ 7,483 $ 1,869 $ 5,614 Changes to policies related to revenue recognition under ASC Topic 606 Upon the adoption of ASC Topic 606, there was a change in the pattern of revenue recognition for certain customized parts. Under ASC Topic 605, revenue was recognized for these customized parts when title and risk of loss passed to the customers under the terms of our arrangements with those customers, which was usually at the time of shipment from our plants or distribution centers. As a result of the adoption, the revenue from these contracts is now being recognized over time because the customized parts are considered to be assets with limited alternative use and the Company has an enforceable right to payment for work completed to date. The Company considers the costs incurred (input method) as a fair measure of progress for the over time recognition of revenue associated with these customized parts. The following tables summarize the impacts of adopting ASC Topic 606 on the Company’s consolidated financial statements as of and for the three and nine month periods ended September 30, 2018 : Three Months Ended Nine Months Ended As Reported Balances Without Adoption of ASC Topic 606 Effect of Change Higher/(Lower) As Reported Balances Without Adoption of ASC Topic 606 Effect of Change Higher/(Lower) (Millions) (Millions) Consolidated Statements of Income Revenues Net sales and operating revenues $ 2,372 $ 2,372 $ — $ 7,483 $ 7,481 $ 2 Cost and expenses Cost of sales (exclusive of depreciation and amortization) 2,014 2,014 — 6,371 6,369 2 September 30, 2018 As Reported Balances Without Adoption of ASC Topic 606 Effect of Change Higher/(Lower) (Millions) Consolidated Balance Sheet Assets Inventory $ 956 $ 963 $ (7 ) Prepayments and other (including contract assets) 369 349 20 Liabilities Accrued liabilities 299 287 12 Equity Accumulated deficit (823 ) (824 ) 1 Three Months Ended Nine Months Ended As Reported Balances Without Adoption of ASC Topic 606 Effect of Change Higher/(Lower) As Reported Balances Without Adoption of ASC Topic 606 Effect of Change Higher/(Lower) (Millions) (Millions) Consolidated Statements of Cash Flows Operating Activities Increase in inventories $ (65 ) $ (64 ) $ (1 ) $ (118 ) $ (125 ) $ 7 Increase in prepayments and other current assets (21 ) (21 ) — (91 ) (71 ) (20 ) (Decrease) increase in other current liabilities (19 ) (20 ) 1 11 (1 ) 12 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On October 1, 2018, we completed our Acquisition of all of the interests in Federal-Mogul. Total consideration was approximately $5.2 billion . The Company will record the assets acquired and liabilities assumed at their fair values as of the acquisition date. Due to the limited amount of time since the closing of the Acquisition, the initial purchase accounting for the Acquisition has yet to be completed, including determining the fair value, as of the acquisition date, of recognized and previously unrecognized assets and liabilities. Federal-Mogul's annual sales in 2017 were $7.9 billion . We will provide additional disclosures in our Form 10-K once the initial purchase accounting is complete.See Note 2, Acquisition of Federal-Mogul for additional information. Following the completion of the Acquisition, Federal-Mogul was merged with and into the Company, with the Company continuing as the surviving company. In addition, at the effective time of the Acquisition, the Company’s certificate of incorporation was amended and restated in order to create a new class of non-voting Class B Common Stock and to reclassify the Company’s existing common stock as Class A Voting Common Stock. See Note 2, Acquisition of Federal-Mogul for additional information. On the same date, the Company also entered into a New Credit Facility in connection with the Acquisition. The New Credit Facility includes $4.9 billion of total debt financing, consisting of a five -year $1.5 billion revolving credit facility, a five -year $1.7 billion term loan A facility and a seven -year $1.7 billion term loan B facility. See Note 4, Debt and Other Financing Arrangements for additional information. On October 26, 2018, we announced our plan to close our OE ride control plants in Owen Sound, Ontario and Hartwell, Georgia as part of an initiative to realign our manufacturing footprint to enhance operational efficiency and respond to changing market conditions and capacity requirements. We expect to complete the closure of the two facilities near the end of the second quarter of 2020. Restructuring and related charges are expected to be in the range of $70 million to $85 million , with $20 million to $30 million occurring in the fourth quarter of 2018. The charges comprise between $40 million and $50 million of cash expenditures (including severance payments to employees, the cost of decommissioning and starting up equipment, and other costs associated with this action) and between $30 million and $35 million of non-cash asset write-downs and other costs. |
New Accounting Pronouncements (
New Accounting Pronouncements (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Adoption of New Accounting Standards In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The new guidance improved the presentation of net periodic pension and postretirement benefit costs. We retrospectively adopted this standard in the first quarter of 2018. We recorded other pension and postretirement costs of $4 million and $10 million in other expense, net for the three and nine month periods ended September 30, 2018 , respectively. Prior to adoption, this amount would have been recorded in selling, general, and administrative expenses and cost of sales in the condensed consolidated statements of income. Prior year net pension and postretirement costs of $3 million and $10 million for the three and nine month periods ended September 30, 2017 , respectively, have been reclassified from selling, general, and administrative expenses and cost of sales to other expense, net to conform to the current year presentation. Of the $10 million adjustment for the nine month period ended September 30, 2017 , $6 million was a non-cash charge related to a voluntary program to buy out active employees and retirees who had earned benefits in the U.S. pension plans. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows - Restricted Cash (Topic 230) to eliminate diversity in practice in the presentation of restricted cash and restricted cash equivalents in the statement of cash flows. We retrospectively adopted this standard in the first quarter of 2018 with no material impact. Prior year amounts have been reclassified to conform to current year presentation. In October 2016, the FASB issued ASU 2016-16, Income Taxes - Intra Entity Transfers of Assets Other Than Inventory (Topic 740). The standard changed the accounting for income taxes when a company transfers certain tangible and intangible assets, such as equipment or intellectual property, between entities in different tax jurisdictions. The standard did not change the current accounting for the income taxes related to transfers of inventory. We adopted this standard on January 1, 2018 using the modified retrospective method. The cumulative effect of the adoption was recognized as an increase to accumulated deficit of $2 million . In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows - Classification of certain cash receipts and cash payments (Topic 230). This update addressed eight specific cash flow issues with the objective of reducing the diversity in practice. We retrospectively adopted this standard in the first quarter of 2018. We recorded $36 million and $102 million as an investing activity in the condensed consolidated statements of cash flows for the cash we received to settle the deferred purchase price of factored receivables for the three and nine month periods ended September 30, 2018 , respectively. Prior to adoption, this amount would have been recorded as an operating activity. Prior period amounts of $28 million and $77 million for the three and nine month periods ended September 30, 2017 , respectively, have been reclassified from operating to investing activities to conform to the current year presentation. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), an amendment on revenue recognition. The amendment in this update created Topic 606, Revenue from Contracts with Customers, and superseded the revenue recognition requirements in Topic 605, Revenue Recognition, including most industry-specific revenue recognition guidance throughout the industry topics of the codification. In addition, the amendment superseded the cost guidance in Subtopic 605-35, Revenue Recognition-Construction-Type and Production-Type Contracts, and created a new Subtopic 340-40, Other Assets and Deferred Costs-Contracts with Customers. The core principle of Topic 606 is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We adopted Topic 606 on January 1, 2018, using the modified retrospective method. The cumulative effect of the adoption was recognized as a decrease to accumulated deficit of $1 million on January 1, 2018. Please refer to Note 15, Revenue for further discussion of the adoption of this standard. Accounting Standards Issued But Not Yet Adopted In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in this update. The amendments in this update are effective for interim and annual periods for the Company beginning on January 1, 2020, with early adoption permitted. The amendments in this update should be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. We are currently evaluating the potential impact of this new guidance on the Company's consolidated financial statements. In August 2018, the FASB issued ASU 2018-14, Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20). The amendments in this update remove disclosures that no longer are considered cost beneficial, clarify the specific requirements of disclosures, and add disclosure requirements identified as relevant. Although narrow in scope, the amendments are considered an important part of the Board's efforts to improve the effectiveness of disclosures in the notes to financial statements by applying concepts in the concepts statement. The amendments in this update are effective for fiscal years ending after December 15, 2020 with early adoption permitted. We are currently evaluating the potential impact of this new guidance on the Company's consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820). The new guidance modifies disclosure requirements related to fair value measurement. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Implementation on a prospective or retrospective basis varies by specific disclosure requirement. Early adoption is permitted. The standard also allows for early adoption of any removed or modified disclosures upon issuance of this ASU while delaying adoption of the additional disclosures until their effective date. In February 2018, the FASB issued ASU 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220). The amendments in this update allow a reclassification from accumulated other comprehensive income to accumulated deficit for stranded tax effects resulting from the Tax Cuts and Jobs Act. Consequently, the amendments allow for an election to eliminate the stranded tax effects resulting from the Tax Cuts and Jobs Act and will improve the usefulness of information reported to financial statement users. However, because the amendments only relate to the reclassification of the income tax effects of the Tax Cuts and Jobs Act, the underlying guidance that requires the effect of a change in tax laws or rates be included in income from continuing operations is not affected. The amendments in this update also require certain disclosures about stranded tax effects. The amendments in this update are effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. We are currently evaluating the potential impact of this new guidance on the Company's consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This update supersedes the lease requirements in Topic 840, Leases. The objective of Topic 842 is to establish the principles that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flow arising from a lease. For public business entities, the standard is effective for financial statements issued for annual periods beginning after December 15, 2018, and interim periods within those annual periods. We will adopt this amendment on January 1, 2019. We are currently undertaking a process to quantify the impact that this standard will have on our condensed consolidated financial statements, including reviewing our lease arrangements, as well as working through system implementation steps and assessing our procedural and policy requirements. At a minimum, in the period the ASU is adopted, total assets and total liabilities will increase in the condensed consolidated balance sheet as a result of recognizing right-of-use assets and liabilities for our operating lease obligations. |
Consolidation and Presentation
Consolidation and Presentation (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Redeemable Noncontrolling Interest | The following is a rollforward of activities in our redeemable noncontrolling interests for the nine months ended September 30, 2018 and 2017 : Nine Months Ended 2018 2017 (Millions) Balance January 1 $ 42 $ 40 Net income attributable to redeemable noncontrolling interests 22 27 Other comprehensive (loss) income (3 ) 2 Dividends declared (33 ) (37 ) Balance September 30 $ 28 $ 32 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Carrying and Estimated Fair Value | The net carrying and estimated fair values of our financial instruments by class at September 30, 2018 and December 31, 2017 were as follows: September 30, 2018 December 31, 2017 Net Carrying Amount Fair Value Net Carrying Amount Fair Value (Millions) Long-term debt (including current maturities) $ 1,308 $ 1,252 $ 1,361 $ 1,398 Equity swap agreement and foreign currency forward contracts: Asset derivative contracts (a) 5 5 4 4 (a) All derivatives are categorized within Level 2 of the fair value hierarchy. |
Summarization for Foreign Currency Forward Purchase and Sale Contracts | The following table summarizes by major currency the notional amounts for foreign currency forward purchase and sale contracts as of September 30, 2018 (all of which mature in 2018): Notional Amount in Foreign Currency (Millions) Canadian dollars —Sell (2 ) Chinese yuan —Purchase 4 U.S. dollars —Purchase 1 |
Debt and Other Financing Arra_2
Debt and Other Financing Arrangements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | A summary of our long-term debt obligations at September 30, 2018 and December 31, 2017 is set forth in the following table: September 30, 2018 December 31, 2017 Principal Carrying Amount (1) Principal Carrying Amount (1) (Millions) Tenneco Inc. — Revolver borrowings due 2022 $ 207 $ 207 $ 244 $ 244 Senior Tranche A Term Loan due 2022 375 373 390 388 5 3/8% Senior Notes due 2024 225 222 225 222 5% Senior Notes due 2026 500 493 500 492 Other subsidiaries — Other long-term debt due in 2020 6 6 5 5 Notes due 2018 through 2028 8 7 12 10 1,321 1,308 1,376 1,361 Less — maturities classified as current 4 4 3 3 Total long-term debt $ 1,317 $ 1,304 $ 1,373 $ 1,358 (1) Carrying amount is net of unamortized debt issuance costs and debt discounts. Total unamortized debt issuance costs were $11 million and $13 million as of September 30, 2018 and December 31, 2017 , respectively, and the total unamortized debt discount was $2 million as of both September 30, 2018 and December 31, 2017 . |
Schedule of Short-term Debt | Information regarding our short-term debt as of September 30, 2018 and December 31, 2017 is as follows: September 30, December 31, (Millions) Maturities classified as current $ 4 $ 3 Short-term borrowings 236 80 Total short-term debt $ 240 $ 83 |
Financial Ratios under Senior Credit Facility | The financial ratios required under the senior credit facility outstanding as of September 30, 2018, and the actual ratios we achieved for the first three quarters of 2018, are as follows: Quarter Ended September 30, 2018 June 30, 2018 March 31, 2018 Required Actual Required Actual Required Actual Leverage Ratio (maximum) 3.50 2.05 3.50 1.79 3.50 2.09 Interest Coverage Ratio (minimum) 2.75 10.05 2.75 10.84 2.75 9.87 |
Restructuring and Other Charg_2
Restructuring and Other Charges (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost | The Company's restructuring and other charges are classified in the condensed consolidated statements of income as follows: Three Months Ended Nine Months Ended 2018 2017 2018 2017 (Millions) Cost of sales $ 12 $ 8 $ 44 $ 31 Engineering, research, and development — — 1 — Selling, general, and administrative — 11 10 18 Depreciation and amortization of other intangibles — 1 — 3 $ 12 $ 20 $ 55 $ 52 |
Roll Forward of Restructuring Reserve | Amounts related to activities that were charged to our restructuring reserves, including costs incurred to support future structural cost reductions, are as follows: December 31, 2018 2018 Impact of Exchange Rates September 30, 2018 (Millions) Employee severance, termination benefits and other related costs $ 25 $ 55 $ (47 ) $ (1 ) $ 32 |
Environmental Matters, Litiga_2
Environmental Matters, Litigation and Product Warranties (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Environmental Matters, Litigation and Product Warranties [Abstract] | |
Warranty Accrual Rollforward | Below is a table that shows the activity in the warranty accrual accounts: Nine Months Ended 2018 2017 (Millions) Beginning Balance January 1, $ 26 $ 20 Accruals related to product warranties 13 13 Reductions for payments made (11 ) (8 ) Ending Balance September 30, $ 28 $ 25 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Summary of Earnings Per Share of Common Stock | Earnings per share of common stock outstanding were computed as follows: Three Months Ended Nine Months Ended 2018 2017 2018 2017 (Millions Except Share and Per Share Amounts) Basic earnings per share — Net income attributable to Tenneco Inc. $ 54 $ 83 $ 162 $ 139 Weighted average shares of common stock outstanding 51,272,618 52,508,078 51,247,664 53,265,149 Earnings per share of common stock $ 1.05 $ 1.57 $ 3.17 $ 2.61 Diluted earnings per share — Net income attributable to Tenneco Inc. $ 54 $ 83 $ 162 $ 139 Weighted average shares of common stock outstanding 51,272,618 52,508,078 51,247,664 53,265,149 Effect of dilutive securities: Restricted stock, PSUs and RSUs 93,956 89,666 95,022 106,320 Stock options 35,255 89,912 53,241 130,395 Weighted average shares of common stock outstanding including dilutive securities 51,401,829 52,687,656 51,395,927 53,501,864 Earnings per share of common stock $ 1.05 $ 1.57 $ 3.16 $ 2.60 |
Common Stock (Tables)
Common Stock (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Options Status and Activity | The following table reflects the status and activity for all options to purchase common stock for the period indicated: Nine Months Ended September 30, 2018 Shares Weighted Avg. Weighted Avg. Aggregate (Millions) Outstanding Stock Options Outstanding, January 1, 2018 318,016 $ 43.60 2.6 $ 5 Exercised (4,607 ) 26.78 — Outstanding, March 31, 2018 313,409 43.84 2.1 4 Forfeited (2,368 ) 54.34 — Outstanding, June 30, 2018 311,041 43.76 1.8 2 Exercised (11,420 ) 29.93 — Outstanding, September 30, 2018 299,621 $ 44.29 2.4 $ 1 |
Nonvested Restricted Shares | The following table reflects the status for all nonvested restricted shares, share-settled RSUs and PSUs for the period indicated: Restricted Shares Share-Settled RSUs PSUs Shares Weighted Avg. Shares Weighted Avg. Shares Weighted Avg. Nonvested balance at January 1, 2018 410,251 $ 49.95 — $ — — $ — Granted 17,440 55.05 253,257 55.02 214,348 50.75 Vested (168,409 ) 47.08 — — — — Forfeited (5,108 ) 48.68 (1,362 ) 55.04 — — Nonvested balance at March 31, 2018 254,174 52.23 251,895 55.02 214,348 50.75 Granted 1,573 47.97 16,995 47.17 25,957 35.64 Vested (60,434 ) 49.89 (192 ) 55.04 — — Forfeited (2,482 ) 57.15 (8,001 ) 55.04 (4,051 ) 50.75 Nonvested balance at June 30, 2018 192,831 53.14 260,697 54.51 236,254 49.28 Granted — — 14,903 42.22 8,623 32.24 Vested (6,443 ) 53.31 — — — — Forfeited (1,210 ) 62.79 (6,408 ) 55.04 (5,882 ) 50.75 Nonvested balance at September 30, 2018 185,178 $ 53.07 269,192 $ 57.51 238,995 $ 48.68 |
Pension Plans, Postretirement_2
Pension Plans, Postretirement and Other Employee Benefits (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Retirement Benefits [Abstract] | |
Components of Net Periodic Benefit Cost | Net periodic pension and other postretirement benefit costs consist of the following components: Three Months Ended September 30, Pension Postretirement 2018 2017 2018 2017 U.S. Foreign U.S. Foreign U.S. U.S. (Millions) Service cost — benefits earned during the period $ 1 $ 3 $ 1 $ 3 $ — $ — Interest cost (a) 3 3 2 4 2 1 Expected return on plan assets (a) (4 ) (5 ) (4 ) (4 ) — — Net amortization: Actuarial loss (a) 1 2 1 1 2 2 Prior service cost (a) — — — 1 — — Net pension and postretirement costs $ 1 $ 3 $ — $ 5 $ 4 $ 3 Nine Months Ended September 30, Pension Postretirement 2018 2017 2018 2017 U.S. Foreign U.S. Foreign U.S. US (Millions) Service cost — benefits earned during the period $ 1 $ 8 $ 1 $ 7 $ — $ — Interest cost (a) 8 9 7 10 5 4 Expected return on plan assets (a) (11 ) (15 ) (11 ) (19 ) — — Settlement loss (a) — — 6 — — — Net amortization: Actuarial loss (a) 3 6 4 6 6 5 Prior service cost (credit) (a) — — — 1 (1 ) (1 ) Net pension and postretirement costs $ 1 $ 8 $ 7 $ 5 $ 10 $ 8 (a) Recorded in other expense, net. |
Amounts Recognized for Pension and Postretirement Benefits in Other Comprehensive Income | Amounts recognized for pension and postretirement benefits in other comprehensive income for the three and nine months ended September 30, 2018 and 2017 include the following components: Three Months Ended September 30, 2018 2017 Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax (Millions) Defined benefit pension and postretirement plans: Amortization of prior service cost included in net periodic pension and postretirement costs $ — $ — $ — $ 1 $ — $ 1 Amortization of actuarial loss included in net periodic pension and postretirement costs 5 (1 ) 4 4 (2 ) 2 Other comprehensive income – pension benefits $ 5 $ (1 ) $ 4 $ 5 $ (2 ) $ 3 Nine Months Ended September 30, 2018 2017 Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax (Millions) Defined benefit pension and postretirement plans: Amortization of prior service credit included in net periodic pension and postretirement costs $ (1 ) $ — $ (1 ) $ — $ — $ — Amortization of actuarial loss included in net periodic pension and postretirement costs 15 (3 ) 12 15 (5 ) 10 Settlement charge — — — 6 (2 ) 4 Other comprehensive income – pension benefits $ 14 $ (3 ) $ 11 $ 21 $ (7 ) $ 14 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | The following table summarizes certain of the Company's segment information: Segments Clean Air Ride Performance Aftermarket Total Other Reclass & Elims Total (Millions) At September 30, 2018 and for the Three Months Ended September 30, 2018 Revenues from external customers $ 1,602 $ 461 $ 309 $ 2,372 $ — $ — $ 2,372 Intersegment revenues 14 16 12 42 — (42 ) — EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests 104 (5 ) 45 144 (40 ) — 104 Total assets 3,008 1,079 885 4,972 — 56 5,028 At September 30, 2017 and for the Three Months Ended September 30, 2017 Revenues from external customers $ 1,495 $ 457 $ 322 $ 2,274 $ — $ — $ 2,274 Intersegment revenues 11 18 8 37 — (37 ) — EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests 100 7 50 157 (23 ) — 134 Total assets 2,912 1,100 864 4,876 — 59 4,935 At September 30, 2018 and for the Nine Months Ended September 30, 2018 Revenues from external customers $ 5,052 $ 1,480 $ 951 $ 7,483 $ — $ — $ 7,483 Intersegment revenues 42 45 35 122 — (122 ) — EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests 328 8 130 466 (132 ) — 334 Total assets 3,008 1,079 885 4,972 — 56 5,028 At September 30, 2017 and for the Nine Months Ended September 30, 2017 Revenues from external customers $ 4,589 $ 1,327 $ 967 $ 6,883 $ — $ — $ 6,883 Intersegment revenues 53 46 29 128 — (128 ) — EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests 300 52 146 498 (216 ) — 282 Total assets 2,912 1,100 864 4,876 — 59 4,935 |
Supplemental Guarantor Conden_2
Supplemental Guarantor Condensed Consolidating Financial Statements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Statement of Comprehensive Income (Loss) | STATEMENT OF COMPREHENSIVE INCOME Three Months Ended September 30, 2018 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Revenues Net sales and operating revenues — External $ 990 $ 1,382 $ — $ — $ 2,372 Affiliated companies 145 152 — (297 ) — 1,135 1,534 — (297 ) 2,372 Costs and expenses Cost of sales (exclusive of depreciation and amortization shown below) 962 1,349 — (297 ) 2,014 Engineering, research, and development 20 19 — — 39 Selling, general, and administrative 67 74 — — 141 Depreciation and amortization of other intangibles 30 35 — — 65 1,079 1,477 — (297 ) 2,259 Other expense (income) Loss on sale of receivables 1 2 — — 3 Other expense (income) 10 (10 ) — 6 6 11 (8 ) — 6 9 Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies 45 65 — (6 ) 104 Interest expense — External (net of interest capitalized) 9 2 10 — 21 Affiliated companies (net of interest income) (4 ) — 4 — — Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies 40 63 (14 ) (6 ) 83 Income tax expense 10 10 — — 20 Equity in net income from affiliated companies 38 — 68 (106 ) — Net income 68 53 54 (112 ) 63 Less: Net income attributable to noncontrolling interests — 9 — — 9 Net income attributable to Tenneco Inc. $ 68 $ 44 $ 54 $ (112 ) $ 54 Comprehensive income attributable to Tenneco Inc. $ 68 $ 44 $ 30 $ (112 ) $ 30 STATEMENT OF COMPREHENSIVE INCOME Three Months Ended September 30, 2017 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Revenues Net sales and operating revenues — External $ 917 $ 1,357 $ — $ — $ 2,274 Affiliated companies 128 143 — (271 ) — 1,045 1,500 — (271 ) 2,274 Costs and expenses Cost of sales (exclusive of depreciation and amortization shown below) 887 1,295 — (271 ) 1,911 Engineering, research, and development 17 23 — — 40 Selling, general, and administrative 50 77 — — 127 Depreciation and amortization of other intangibles 23 35 — — 58 977 1,430 — (271 ) 2,136 Other expense (income) Loss on sale of receivables 1 1 — — 2 Other expense (income) 12 (10 ) — — 2 13 (9 ) — — 4 Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies 55 79 — — 134 Interest expense — External (net of interest capitalized) 7 2 10 — 19 Affiliated companies (net of interest income) (5 ) 3 2 — — Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies 53 74 (12 ) — 115 Income tax (benefit) expense (5 ) 21 — — 16 Equity in net income from affiliated companies 31 — 95 (126 ) — Net income 89 53 83 (126 ) 99 Less: Net income attributable to noncontrolling interests — 16 — — 16 Net income attributable to Tenneco Inc. $ 89 $ 37 $ 83 $ (126 ) $ 83 Comprehensive income attributable to Tenneco Inc. $ 89 $ 31 $ 114 $ (120 ) $ 114 STATEMENT OF COMPREHENSIVE INCOME Nine Months Ended September 30, 2018 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Revenues Net sales and operating revenues — External $ 3,050 $ 4,433 $ — $ — $ 7,483 Affiliated companies 402 464 — (866 ) — 3,452 4,897 — (866 ) 7,483 Costs and expenses Cost of sales (exclusive of depreciation and amortization shown below) 2,956 4,281 — (866 ) 6,371 Engineering, research, and development 57 65 — — 122 Selling, general, and administrative 222 228 — — 450 Depreciation and amortization of other intangibles 74 109 — — 183 3,309 4,683 — (866 ) 7,126 Other expense (income) Loss on sale of receivables 5 3 — — 8 Other expense (income) 40 (41 ) — 16 15 45 (38 ) — 16 23 Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies 98 252 — (16 ) 334 Interest expense — External (net of interest capitalized) 25 7 29 — 61 Affiliated companies (net of interest income) (11 ) — 11 — — Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies 84 245 (40 ) (16 ) 273 Income tax expense 9 63 — — 72 Equity in net income from affiliated companies 122 — 202 (324 ) — Net income 197 182 162 (340 ) 201 Less: Net income attributable to noncontrolling interests — 39 — — 39 Net income attributable to Tenneco Inc. $ 197 $ 143 $ 162 $ (340 ) $ 162 Comprehensive income attributable to Tenneco Inc. $ 197 $ 143 $ 71 $ (340 ) $ 71 STATEMENT OF COMPREHENSIVE INCOME Nine Months Ended September 30, 2017 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Revenues Net sales and operating revenues — External $ 2,958 $ 3,925 $ — $ — $ 6,883 Affiliated companies 413 497 — (910 ) — 3,371 4,422 — (910 ) 6,883 Costs and expenses Cost of sales (exclusive of depreciation and amortization shown below) 2,865 3,834 — (910 ) 5,789 Engineering, research, and development 56 59 — — 115 Selling, general, and administrative 301 219 — — 520 Depreciation and amortization of other intangibles 65 100 — — 165 3,287 4,212 — (910 ) 6,589 Other expense (income) Loss on sale of receivables 2 2 — — 4 Other expense (income) 24 (31 ) — 15 8 26 (29 ) — 15 12 Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies 58 239 — (15 ) 282 Interest expense — External (net of interest capitalized) 10 4 40 — 54 Affiliated companies (net of interest income) (12 ) 6 6 — — Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies 60 229 (46 ) (15 ) 228 Income tax expense 6 35 — — 41 Equity in net income from affiliated companies 119 — 185 (304 ) — Net income 173 194 139 (319 ) 187 Less: Net income attributable to noncontrolling interests — 48 — — 48 Net income attributable to Tenneco Inc. $ 173 $ 146 $ 139 $ (319 ) $ 139 Comprehensive income attributable to Tenneco Inc. $ 173 $ 140 $ 234 $ (313 ) $ 234 |
Balance Sheet | BALANCE SHEET September 30, 2018 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) ASSETS Current assets: Cash and cash equivalents $ 5 $ 197 $ — $ — $ 202 Restricted cash — 1 — — 1 Receivables, net 434 1,707 — (733 ) 1,408 Inventories 414 542 — — 956 Prepayments and other 139 230 — — 369 Total current assets 992 2,677 — (733 ) 2,936 Other assets: Investment in affiliated companies 1,385 — 1,357 (2,742 ) — Notes and advances receivable from affiliates 801 20,907 4,180 (25,888 ) — Long-term receivables, net 12 — — — 12 Goodwill 22 25 — — 47 Intangibles, net 5 15 — — 20 Deferred income taxes 171 56 — — 227 Other 63 91 — — 154 2,459 21,094 5,537 (28,630 ) 460 Plant, property, and equipment, at cost 1,564 2,504 — — 4,068 Less — Accumulated depreciation and amortization (978 ) (1,458 ) — — (2,436 ) 586 1,046 — — 1,632 Total assets $ 4,037 $ 24,817 $ 5,537 $ (29,363 ) $ 5,028 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Short-term debt (including current maturities of long-term debt): Short-term debt — non-affiliated $ — $ 225 $ 15 $ — $ 240 Short-term debt — affiliated 458 157 — (615 ) — Accounts payable 724 1,157 — (112 ) 1,769 Accrued taxes 4 34 — — 38 Other 210 232 9 (6 ) 445 Total current liabilities 1,396 1,805 24 (733 ) 2,492 Long-term debt: Long-term debt — non-affiliated 580 9 715 — 1,304 Long-term debt — affiliated 1,061 20,766 4,061 (25,888 ) — Deferred income taxes — 11 — — 11 Pension, postretirement benefits and other liabilities 298 120 — — 418 Total liabilities 3,335 22,711 4,800 (26,621 ) 4,225 Redeemable noncontrolling interests — 28 — — 28 Tenneco Inc. shareholders’ equity 702 2,040 737 (2,742 ) 737 Noncontrolling interests — 38 — — 38 Total equity 702 2,078 737 (2,742 ) 775 Total liabilities, redeemable noncontrolling interests and equity $ 4,037 $ 24,817 $ 5,537 $ (29,363 ) $ 5,028 BALANCE SHEET December 31, 2017 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) ASSETS Current assets: Cash and cash equivalents $ 7 $ 308 $ — $ — $ 315 Restricted cash — 3 — — 3 Receivables, net 402 1,567 — (648 ) 1,321 Inventories 383 486 — — 869 Prepayments and other 99 192 — — 291 Total current assets 891 2,556 — (648 ) 2,799 Other assets: Investment in affiliated companies 1,389 — 1,258 (2,647 ) — Notes and advances receivable from affiliates 791 19,119 3,967 (23,877 ) — Long-term receivables, net 8 1 — — 9 Goodwill 22 27 — — 49 Intangibles, net 5 17 — — 22 Deferred income taxes 161 43 — — 204 Other 66 78 — — 144 2,442 19,285 5,225 (26,524 ) 428 Plant, property, and equipment, at cost 1,478 2,530 — — 4,008 Less — Accumulated depreciation and amortization (934 ) (1,459 ) — — (2,393 ) 544 1,071 — — 1,615 Total assets $ 3,877 $ 22,912 $ 5,225 $ (27,172 ) $ 4,842 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Short-term debt (including current maturities of long-term debt): Short-term debt — non-affiliated $ — $ 83 $ — $ — $ 83 Short-term debt — affiliated 408 148 — (556 ) — Accounts payable 562 1,232 — (89 ) 1,705 Accrued taxes 8 37 — — 45 Other 203 221 12 (3 ) 433 Total current liabilities 1,181 1,721 12 (648 ) 2,266 Long-term debt: Long-term debt — non-affiliated 632 12 714 — 1,358 Long-term debt — affiliated 1,093 18,981 3,803 (23,877 ) — Deferred income taxes — 11 — — 11 Pension, postretirement benefits and other liabilities 296 127 — — 423 Total liabilities 3,202 20,852 4,529 (24,525 ) 4,058 Redeemable noncontrolling interests — 42 — — 42 Tenneco Inc. shareholders’ equity 675 1,972 696 (2,647 ) 696 Noncontrolling interests — 46 — — 46 Total equity 675 2,018 696 (2,647 ) 742 Total liabilities, redeemable noncontrolling interests and equity $ 3,877 $ 22,912 $ 5,225 $ (27,172 ) $ 4,842 |
Statement of Cash Flows | STATEMENT OF CASH FLOWS Three Months Ended September 30, 2018 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Operating Activities Net cash provided (used) by operating activities $ 111 $ (145 ) $ (4 ) $ (3 ) $ (41 ) Investing Activities Proceeds from sale of assets — 1 — — 1 Cash payments for plant, property, and equipment (29 ) (49 ) — — (78 ) Cash payments for software related intangible assets (1 ) (2 ) — — (3 ) Proceeds from deferred purchase price of factored receivables — 36 — — 36 Other (4 ) — — — (4 ) Net cash used by investing activities (34 ) (14 ) — — (48 ) Financing Activities Repurchase of common shares — — (1 ) — (1 ) Cash dividends — — (14 ) — (14 ) Payments of long-term debt (5 ) — — — (5 ) Net increase in bank overdrafts — 2 — — 2 Net (decrease) increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable (243 ) 164 2 — (77 ) Net increase in short-term borrowings secured by accounts receivable 170 — — — 170 Intercompany dividend payments and net increase (decrease) in intercompany obligations 4 (24 ) 17 3 — Distributions to noncontrolling interest partners — (16 ) — — (16 ) Net cash (used) provided by financing activities (74 ) 126 4 3 59 Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash — (4 ) — — (4 ) Increase (decrease) in cash, cash equivalents and restricted cash 3 (37 ) — — (34 ) Cash, cash equivalents and restricted cash, July 1 3 234 — — 237 Cash, cash equivalents and restricted cash, September 30 (Note) $ 6 $ 197 $ — $ — $ 203 Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase. STATEMENT OF CASH FLOWS Three Months Ended September 30, 2017 Guarantor Nonguarantor Tenneco Inc. Reclass & Consolidated (Millions) Operating Activities Net cash provided (used) by operating activities $ 39 $ (2 ) $ (8 ) $ (4 ) $ 25 Investing Activities Cash payments for plant, property, and equipment (29 ) (61 ) — — (90 ) Cash payments for software related intangible assets (4 ) (1 ) — — (5 ) Proceeds from deferred purchase price of factored receivables — 28 — — 28 Other (1 ) — — — (1 ) Net cash used by investing activities (34 ) (34 ) — — (68 ) Financing Activities Issuance of common shares — — 1 — 1 Cash dividends — — (14 ) — (14 ) Payments of long-term debt — (1 ) — — (1 ) Purchase of common stock under the share repurchase program — — (71 ) — (71 ) Net decrease in bank overdrafts — (3 ) — — (3 ) Net increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable 82 2 — — 84 Intercompany dividend payments and net (decrease) increase in intercompany obligations (87 ) (9 ) 92 4 — Distributions to noncontrolling interest partners — (12 ) — — (12 ) Net cash (used) provided by financing activities (5 ) (23 ) 8 4 (16 ) Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash — 3 — — 3 Decrease in cash, cash equivalents and restricted cash — (56 ) — — (56 ) Cash, cash equivalents and restricted cash, July 1 4 331 — — 335 Cash, cash equivalents and restricted cash, September 30 (Note) $ 4 $ 275 $ — $ — $ 279 Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase. STATEMENT OF CASH FLOWS Nine Months Ended September 30, 2018 Guarantor Nonguarantor Tenneco Inc. Reclass Consolidated (Millions) Operating Activities Net cash provided (used) by operating activities $ 190 $ (132 ) $ (9 ) $ (12 ) $ 37 Investing Activities Proceeds from sale of assets 1 5 — — 6 Cash payments for plant, property, and equipment (100 ) (142 ) — — (242 ) Cash payments for software related intangible assets (7 ) (6 ) — — (13 ) Proceeds from deferred purchase price of factored receivables — 102 — — 102 Other (2 ) — — — (2 ) Net cash used by investing activities (108 ) (41 ) — — (149 ) Financing Activities Repurchase of common shares — — (2 ) — (2 ) Cash dividends — — (39 ) — (39 ) Payments of long-term debt (14 ) (3 ) — — (17 ) Debt issuance cost for long-term debt (2 ) — — — (2 ) Net decrease in bank overdrafts — (5 ) — — (5 ) Net (decrease) increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable (189 ) 144 16 — (29 ) Net increase in short-term borrowings secured by accounts receivable 150 — — — 150 Intercompany dividend payments and net (decrease) increase in intercompany obligations (28 ) (18 ) 34 12 — Distributions to noncontrolling interest partners — (44 ) — — (44 ) Net cash (used) provided by financing activities (83 ) 74 9 12 12 Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash — (15 ) — — (15 ) Decrease in cash, cash equivalents and restricted cash (1 ) (114 ) — — (115 ) Cash, cash equivalents and restricted cash, January 1 7 311 — — 318 Cash, cash equivalents and restricted cash, September 30 (Note) $ 6 $ 197 $ — $ — $ 203 Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase. STATEMENT OF CASH FLOWS Nine Months Ended September 30, 2017 Guarantor Nonguarantor Tenneco Inc. Reclass Consolidated (Millions) Operating Activities Net cash provided (used) by operating activities $ 102 $ 24 $ (29 ) $ (11 ) $ 86 Investing Activities Proceeds from sale of assets 3 3 — — 6 Proceeds from sale of equity interest — 9 — — 9 Cash payments for plant, property, and equipment (110 ) (173 ) — — (283 ) Cash payments for software related intangible assets (10 ) (7 ) — — (17 ) Proceeds from deferred purchase price of factored receivables — 77 — — 77 Other (5 ) — — — (5 ) Net cash used by investing activities (122 ) (91 ) — — (213 ) Financing Activities Repurchase of common shares — — (2 ) — (2 ) Cash dividends — — (40 ) — (40 ) Payments of long-term debt — (3 ) (6 ) — (9 ) Issuance of long-term debt 400 — (264 ) — 136 Debt issuance cost for long-term debt (8 ) — — — (8 ) Purchase of common stock under the share repurchase program — — (131 ) — (131 ) Net decrease in bank overdrafts — (12 ) — — (12 ) Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivables 451 16 (323 ) — 144 Net increase in short-term borrowings secured by accounts receivables — — 20 — 20 Intercompany dividend payments and net (decrease) increase in intercompany obligations (828 ) 42 775 11 — Distributions to noncontrolling interest partners — (45 ) — — (45 ) Net cash provided (used) by financing activities 15 (2 ) 29 11 53 Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash — 4 — — 4 Decrease in cash, cash equivalents and restricted cash (5 ) (65 ) — — (70 ) Cash, cash equivalents and restricted cash, January 1 9 340 — — 349 Cash, cash equivalents and restricted cash, September 30 (Note) $ 4 $ 275 $ — $ — $ 279 Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of New Accounting Pronouncements | The cumulative effect of the adoption was recognized as decrease to accumulated deficit of $1 million and the changes made to our consolidated January 1, 2018 opening balance sheet for the adoption of ASC Topic 606 were as follows: Balance at December 31, 2017 Adjustments due to ASU 2014-09 Adjustments due to ASU 2016-16 (a) Balance at January 1, 2018 (Millions) Consolidated Balance Sheet Assets Inventory $ 869 $ (5 ) $ — $ 864 Prepayments and other (including contract assets) 291 6 — 297 Equity Accumulated deficit (946 ) 1 (2 ) (947 ) (a) Cumulative effect of adopting ASU 2016-16, Income Taxes - Intra Entity Transfers of Assets Other Than Inventory (Topic 740). See Note 12, New Accounting Pronouncements for further information. The following tables summarize the impacts of adopting ASC Topic 606 on the Company’s consolidated financial statements as of and for the three and nine month periods ended September 30, 2018 : Three Months Ended Nine Months Ended As Reported Balances Without Adoption of ASC Topic 606 Effect of Change Higher/(Lower) As Reported Balances Without Adoption of ASC Topic 606 Effect of Change Higher/(Lower) (Millions) (Millions) Consolidated Statements of Income Revenues Net sales and operating revenues $ 2,372 $ 2,372 $ — $ 7,483 $ 7,481 $ 2 Cost and expenses Cost of sales (exclusive of depreciation and amortization) 2,014 2,014 — 6,371 6,369 2 September 30, 2018 As Reported Balances Without Adoption of ASC Topic 606 Effect of Change Higher/(Lower) (Millions) Consolidated Balance Sheet Assets Inventory $ 956 $ 963 $ (7 ) Prepayments and other (including contract assets) 369 349 20 Liabilities Accrued liabilities 299 287 12 Equity Accumulated deficit (823 ) (824 ) 1 Three Months Ended Nine Months Ended As Reported Balances Without Adoption of ASC Topic 606 Effect of Change Higher/(Lower) As Reported Balances Without Adoption of ASC Topic 606 Effect of Change Higher/(Lower) (Millions) (Millions) Consolidated Statements of Cash Flows Operating Activities Increase in inventories $ (65 ) $ (64 ) $ (1 ) $ (118 ) $ (125 ) $ 7 Increase in prepayments and other current assets (21 ) (21 ) — (91 ) (71 ) (20 ) (Decrease) increase in other current liabilities (19 ) (20 ) 1 11 (1 ) 12 |
Disaggregation of Revenue | Revenue from contracts with customers is disaggregated by product lines, as it depicts the nature and amount of the Company’s revenue that is aligned with the Company's key growth strategies. In the following table, revenue is disaggregated accordingly: Three Months Ended Nine Months Ended Total Revenues Substrate Sales Value-add Revenues Total Revenues Substrate Sales Value-add Revenues (Millions) (Millions) Clean Air $ 1,602 $ 596 $ 1,006 $ 5,052 $ 1,869 $ 3,183 Ride Performance 461 — 461 1,480 — 1,480 Aftermarket 309 — 309 951 — 951 Total Tenneco Inc. $ 2,372 $ 596 $ 1,776 $ 7,483 $ 1,869 $ 5,614 |
Consolidation and Presentatio_2
Consolidation and Presentation - Additional Information (Details) $ in Millions | 9 Months Ended | |
Sep. 30, 2018USD ($)Segment | Dec. 31, 2017USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Number of reportable segments | Segment | 3 | |
In process tools and dies built for original equipment customers | $ 156 | $ 117 |
Accrued compensation | 110 | 77 |
Bank overdrafts | $ 15 | $ 20 |
Consolidation and Presentatio_3
Consolidation and Presentation - Redeemable Noncontrolling Interest (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Redeemable Noncontrolling Interest [Roll Forward] | ||
Balance January 1 | $ 42 | $ 40 |
Net income attributable to redeemable noncontrolling interests | 22 | 27 |
Other comprehensive (loss) income | (3) | 2 |
Dividends declared | (33) | (37) |
Balance September 30 | $ 28 | $ 32 |
Acquisition of Federal-Mogul (D
Acquisition of Federal-Mogul (Details) - USD ($) $ / shares in Units, $ in Millions | Oct. 01, 2018 | Sep. 30, 2018 | Sep. 30, 2018 |
Business Acquisition [Line Items] | |||
Common stock authorized (in shares) | 135,000,000 | 135,000,000 | |
Stock authorized (in shares) | 185,000,000 | 185,000,000 | |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Preferred stock authorized (in shares) | 50,000,000 | 50,000,000 | |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Federal-Mogul | |||
Business Acquisition [Line Items] | |||
Acquisition related costs, advisory | $ 12 | $ 43 | |
Subsequent event | |||
Business Acquisition [Line Items] | |||
Stock authorized (in shares) | 250,000,000 | ||
Preferred stock authorized (in shares) | 50,000,000 | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | ||
Subsequent event | Federal-Mogul | |||
Business Acquisition [Line Items] | |||
Total consideration | $ 5,200 | ||
Cash consideration | 800 | ||
Debt obligations incurred | $ 3,200 | ||
Share price (in dollars per share) | $ 41.99 | ||
Subsequent event | Common Stock | Federal-Mogul | |||
Business Acquisition [Line Items] | |||
Number of shares issued (in shares) | 29,444,846 | ||
Value of shares issued | $ 1,200 | ||
Subsequent event | Class A Voting Stock | |||
Business Acquisition [Line Items] | |||
Common stock authorized (in shares) | 175,000,000 | ||
Subsequent event | Class A Voting Stock | Common Stock | Federal-Mogul | |||
Business Acquisition [Line Items] | |||
Common stock, par value (in dollars per share) | $ 0.01 | ||
Number of shares issued (in shares) | 5,651,177 | ||
Percentage of shares outstanding | 9.90% | ||
Subsequent event | Class B Non-Voting | |||
Business Acquisition [Line Items] | |||
Common stock authorized (in shares) | 25,000,000 | ||
Subsequent event | Class B Non-Voting | Common Stock | Federal-Mogul | |||
Business Acquisition [Line Items] | |||
Common stock, par value (in dollars per share) | $ 0.01 | ||
Number of shares issued (in shares) | 23,793,669 |
Financial Instruments - Carryin
Financial Instruments - Carrying and Estimated Fair Value (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Carrying And Estimated Fair Value [Line Items] | ||
Long-term debt (including current maturities) | $ 1,304 | $ 1,358 |
Net Carrying Amount | ||
Carrying And Estimated Fair Value [Line Items] | ||
Long-term debt (including current maturities) | 1,308 | 1,361 |
Net Carrying Amount | Equity swap agreement and foreign currency forward contracts | ||
Equity swap agreement and foreign currency forward contracts: | ||
Asset derivative contracts | 5 | 4 |
Fair Value | ||
Carrying And Estimated Fair Value [Line Items] | ||
Long-term debt (including current maturities) | 1,252 | 1,398 |
Fair Value | Equity swap agreement and foreign currency forward contracts | ||
Equity swap agreement and foreign currency forward contracts: | ||
Asset derivative contracts | $ 5 | $ 4 |
Financial Instruments - Fair Va
Financial Instruments - Fair Value of Long Term Debt (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of long term debt | $ 657 | $ 749 |
Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of long term debt | 582 | 634 |
Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of long term debt | $ 13 | $ 15 |
Financial Instruments - Additio
Financial Instruments - Additional Information (Details) shares in Thousands | 9 Months Ended | |
Sep. 30, 2018USD ($)group_retirement_planperformance_agreementshares | Dec. 31, 2017USD ($) | |
Financial Instruments [Line Items] | ||
Maximum percentage of stock of certain first tier foreign subsidiaries pledged to secure senior credit facility | 66.00% | |
Line of credit facility letters of credit outstanding | $ 27,000,000 | |
Financial Instruments not redeemed and used for vendor payment | 12,000,000 | $ 11,000,000 |
Negotiable financial instruments received from OE customer not redeemed | 27,000,000 | 10,000,000 |
Subsidiaries | CHINA | ||
Financial Instruments [Line Items] | ||
Restricted cash | 0 | 2,000,000 |
Subsidiaries | SPAIN | ||
Financial Instruments [Line Items] | ||
Restricted cash | 1,000,000 | 1,000,000 |
Subsidiaries | BRAZIL | ||
Financial Instruments [Line Items] | ||
Restricted cash | $ 0 | 1,000,000 |
TMEL and Walker Plans | ||
Financial Instruments [Line Items] | ||
Number of performance guarantee agreements | performance_agreement | 2 | |
Number of group benefit plans under the agreement | group_retirement_plan | 2 | |
Percentage of the pension obligation recognized for participating employers | 100.00% | |
Foreign Exchange Forward Contracts | ||
Financial Instruments [Line Items] | ||
Term of foreign currency forward contracts (less than one year) | 1 year | |
Net liability position | $ 1,000,000 | 1,000,000 |
Equity Swap | ||
Financial Instruments [Line Items] | ||
Common share equivalents | shares | 250 | |
Net asset position fair value | $ 5,000,000 | $ 4,000,000 |
Financial Instruments - Summari
Financial Instruments - Summarization for Foreign Currency Forward Purchase and Sale Contracts (Details) - Foreign Exchange Forward Contracts $ in Millions | Sep. 30, 2018USD ($) |
Canada, Dollars | Short | |
Derivative [Line Items] | |
Notional Amount in Foreign Currency | $ 2 |
China, Yuan Renminbi | Long | |
Derivative [Line Items] | |
Notional Amount in Foreign Currency | 4 |
U.S., Dollars | Long | |
Derivative [Line Items] | |
Notional Amount in Foreign Currency | $ 1 |
Debt and Other Financing Arra_3
Debt and Other Financing Arrangements - Schedule of Long Term Debt (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
Principal | $ 1,321 | $ 1,376 |
Carrying Amount | 1,308 | 1,361 |
Less — maturities classified as current | 4 | 3 |
Principal less current maturities | 1,317 | 1,373 |
Total long-term debt | 1,304 | 1,358 |
Unamortized debt issuance costs | 11 | 13 |
Unamortized debt discount | 2 | 2 |
Tenneco Inc. | Term Loan | Senior Tranche A Term Loan due 2022 | ||
Debt Instrument [Line Items] | ||
Principal | 375 | 390 |
Carrying Amount | 373 | 388 |
Tenneco Inc. | Senior Notes | 5 3/8% Senior Notes due 2024 | ||
Debt Instrument [Line Items] | ||
Principal | 225 | 225 |
Carrying Amount | $ 222 | 222 |
Interest rate | 5.375% | |
Tenneco Inc. | Senior Notes | 5% Senior Notes due 2026 | ||
Debt Instrument [Line Items] | ||
Principal | $ 500 | 500 |
Carrying Amount | $ 493 | 492 |
Interest rate | 5.00% | |
Other subsidiaries | Other long term debt | Other long-term debt due in 2020 | ||
Debt Instrument [Line Items] | ||
Principal | $ 6 | 5 |
Carrying Amount | 6 | 5 |
Other subsidiaries | Other | Notes due 2018 through 2028 | ||
Debt Instrument [Line Items] | ||
Principal | 8 | 12 |
Carrying Amount | 7 | 10 |
Revolver borrowings due 2022 | Tenneco Inc. | Line of Credit | ||
Debt Instrument [Line Items] | ||
Principal | 207 | 244 |
Carrying Amount | $ 207 | $ 244 |
Debt and Other Financing Arra_4
Debt and Other Financing Arrangements - Schedule of Short Term Debt (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Disclosure [Abstract] | ||
Maturities classified as current | $ 4 | $ 3 |
Short-term borrowings | 236 | 80 |
Total short-term debt | $ 240 | $ 83 |
Debt and Other Financing Arra_5
Debt and Other Financing Arrangements - Additional Information (Details) $ in Millions | 3 Months Ended | 9 Months Ended | 18 Months Ended | ||||
Jun. 30, 2022USD ($) | Jun. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2020USD ($) | Sep. 30, 2018USD ($) | Mar. 31, 2022USD ($) | Dec. 31, 2017USD ($) | |
Debt Instrument [Line Items] | |||||||
Maximum percentage of stock of certain first-tier foreign subsidiaries pledged to secure senior credit facility | 66.00% | 66.00% | |||||
Leverage Ratio Required (Maximum) for future quarters | 3.50 | ||||||
Interest coverage ratio (minimum) | 2.75 | ||||||
Outstanding debt | $ 1,308 | $ 1,308 | $ 1,361 | ||||
Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | 1,600 | 1,600 | |||||
Unused borrowing capacity | 1,393 | 1,393 | |||||
Outstanding debt | 207 | 207 | |||||
Revolving Credit Facility | Tranche Term Facility | |||||||
Debt Instrument [Line Items] | |||||||
Principal payments excluded from current liabilities | 22.5 | 22.5 | |||||
Letter of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Outstanding debt | $ 0 | $ 0 | |||||
Future payment | Revolving Credit Facility | Tranche Term Facility | |||||||
Debt Instrument [Line Items] | |||||||
Repayment of term loan | $ 260 | $ 5 | $ 7.5 | $ 10 |
Debt and Other Financing Arra_6
Debt and Other Financing Arrangements - Senior Credit Facility (Details) $ in Millions | Oct. 01, 2018USD ($)quarterly_installment | Jun. 30, 2022USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2022USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2017USD ($) |
Debt Instrument [Line Items] | |||||||
Outstanding debt | $ 1,308 | $ 1,361 | |||||
Maximum percentage of stock of certain first tier foreign subsidiaries pledged to secure senior credit facility | 66.00% | ||||||
Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 1,600 | ||||||
Unused borrowing capacity | 1,393 | ||||||
Outstanding debt | $ 207 | ||||||
Revolving Credit Facility | Forecast | Tranche Term Facility | |||||||
Debt Instrument [Line Items] | |||||||
Repayment of term loan | $ 260 | $ 5 | $ 7.5 | $ 10 | |||
Subsequent event | Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 4,900 | ||||||
Maximum percentage of stock of certain first tier foreign subsidiaries pledged to secure senior credit facility | 66.00% | ||||||
Subsequent event | Line of Credit | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Debt term | 5 years | ||||||
Maximum borrowing capacity | $ 1,500 | ||||||
Subsequent event | Term Loan | Term Loan A Facility | |||||||
Debt Instrument [Line Items] | |||||||
Debt term | 5 years | ||||||
Maximum borrowing capacity | $ 1,700 | ||||||
Long Term Debt, Maturities, Repayments Of Principal, Through Year Two | 5.00% | ||||||
Long Term Debt, Maturities, Repayments Of Principal, Year Three | 7.50% | ||||||
Long Term Debt, Maturities, Repayments Of Principal, Years Four And Five | 10.00% | ||||||
Long Term Debt, Maturities, Repayments Of Principal, Quarterly Installments | quarterly_installment | 19 | ||||||
Subsequent event | Term Loan | Term Loan B Facility | |||||||
Debt Instrument [Line Items] | |||||||
Debt term | 7 years | ||||||
Maximum borrowing capacity | $ 1,700 | ||||||
Long Term Debt, Maturities, Repayments Of Principal | 0.25% | ||||||
Long Term Debt, Maturities, Repayments Of Principal, Quarterly Installments | quarterly_installment | 27 | ||||||
LIBOR | Subsequent event | Term Loan | Term Loan A Facility | |||||||
Debt Instrument [Line Items] | |||||||
Variable rate percentage | 1.75% | ||||||
LIBOR | Subsequent event | Term Loan | Term Loan B Facility | |||||||
Debt Instrument [Line Items] | |||||||
Variable rate percentage | 2.75% | ||||||
Debt Covenant, Term 1 | Subsequent event | Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated net leverage ratio | 4 | ||||||
Debt Covenant, Term 1 | LIBOR | Subsequent event | Term Loan | Term Loan B Facility | |||||||
Debt Instrument [Line Items] | |||||||
Variable rate percentage | 3.00% | ||||||
Debt Covenant, Term 2 | Subsequent event | Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated net leverage ratio | 3.75 | ||||||
Debt Covenant, Term 3 | Subsequent event | Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated net leverage ratio | 3.5 | ||||||
Debt Covenant, Term 4 | Subsequent event | Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated net leverage ratio | 2.75 |
Debt and Other Financing Arra_7
Debt and Other Financing Arrangements - Financial Ratios under Senior Credit Facility (Details) | 3 Months Ended | ||
Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | |
Required | |||
Financial Ratios Under Senior Credit Facility [Line Items] | |||
Leverage Ratio (maximum) | 3.5 | 3.5 | 3.5 |
Interest Coverage Ratio (minimum) | 2.75 | 2.75 | 2.75 |
Actual | |||
Financial Ratios Under Senior Credit Facility [Line Items] | |||
Leverage Ratio (maximum) | 2.05 | 1.79 | 2.09 |
Interest Coverage Ratio (minimum) | 10.05 | 10.84 | 9.87 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Jun. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |||||
Income tax expense (benefit) | $ 20 | $ 16 | $ 72 | $ 41 | |
Net tax benefit related to acquisition charges | 5 | 12 | |||
Net tax benefit relating valuation release | 10 | $ 12 | 10 | 12 | |
Net tax expense (benefit) for prior year tax adjustments | 9 | $ 2 | 11 | $ (50) | |
One time tax benefit | 53 | ||||
Reasonably possible change in unrecognized tax benefits | $ 6 | $ 6 |
Accounts Receivable Securitiz_2
Accounts Receivable Securitization and Factoring Programs - Additional Information (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018USD ($)bank | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)bank | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) | Apr. 30, 2017USD ($) | |
Transfers of Servicing of Financial Assets [Line Items] | ||||||
Number of commercial banks with accounts receivable securitization programs | bank | 3 | 3 | ||||
Proceeds from deferred purchase price of factored receivables | $ 36 | $ 28 | $ 102 | $ 77 | ||
Term of commitments (in years) | 1 year | |||||
Term of commitments, cancellation period (in days) | 90 days | |||||
U.S. | ||||||
Transfers of Servicing of Financial Assets [Line Items] | ||||||
Outstanding third party investments in securitized accounts receivable bank program | 180 | $ 180 | $ 30 | |||
Securitization interest expense | 1 | 1 | $ 4 | $ 3 | ||
Financing cost related to sale of securitized receivables percentage | 3.00% | 3.00% | ||||
Europe | ||||||
Transfers of Servicing of Financial Assets [Line Items] | ||||||
Outstanding third party investments in securitized accounts receivable bank program | 189 | $ 189 | 218 | |||
Proceeds from deferred purchase price of factored receivables | 28 | 102 | $ 77 | |||
Loss on sale of trade accounts receivable | 2 | $ 2 | $ 5 | $ 4 | ||
Financing cost related to sale of securitized receivables percentage | 2.00% | 2.00% | ||||
Amended and Extended Accounts Receivable Securitization Program | ||||||
Transfers of Servicing of Financial Assets [Line Items] | ||||||
North American program maximum facility size | $ 155 | |||||
Additional Financing from second priority facility | $ 25 | |||||
New Accounts Receivable Factoring Program | U.S. | ||||||
Transfers of Servicing of Financial Assets [Line Items] | ||||||
Outstanding third party investments in securitized accounts receivable bank program | $ 152 | $ 152 | $ 107 |
Restructuring and Other Charg_3
Restructuring and Other Charges - Additional Information (Details) - USD ($) $ in Millions | May 12, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2018 | Dec. 31, 2017 |
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring cost | $ 12 | $ 20 | $ 55 | $ 52 | |||
Non Cash Charges Related To Restructuring Activity | 1 | 3 | |||||
Restructuring and related cost allowed to be excluded from the calculation of financial covenant ratios | $ 35 | ||||||
Restructuring and related cost and litigation costs allowed to be excluded from the calculation of financial covenant ratios | $ 150 | 106 | |||||
Cost of sales | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring cost | 12 | 8 | 44 | 31 | |||
Selling, general, and administrative | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring cost | 0 | 11 | 10 | 18 | |||
Engineering, research, and development | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring cost | 0 | 0 | 1 | 0 | |||
Depreciation and amortization of other intangibles | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring cost | 0 | $ 1 | 0 | $ 3 | |||
Reduction in Structural Costs | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring cost | 4 | 13 | |||||
Reduction in Structural Costs | Selling, general, and administrative | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring cost | 3 | 8 | |||||
Reduction in Structural Costs | Other expenses | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring cost | $ 1 | 1 | |||||
Reduction in Structural Costs | Engineering, research, and development | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring cost | $ 4 | ||||||
Forecast | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring and related cost allowed to be excluded from the calculation of financial covenant ratios | $ 25 |
Restructuring and Other Charg_4
Restructuring and Other Charges - Roll Forward of Restructuring Reserve (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring cost | $ 12 | $ 20 | $ 55 | $ 52 |
Employee severance, termination benefits and other related costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring Reserve | 25 | |||
Restructuring charges | 55 | |||
Cash Payments | (47) | |||
Impact of exchange rates | (1) | |||
Restructuring Reserve | 32 | 32 | ||
Cost of sales | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring cost | 12 | 8 | 44 | 31 |
Engineering, research, and development | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring cost | 0 | 0 | 1 | 0 |
Selling, general, and administrative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring cost | 0 | 11 | 10 | 18 |
Depreciation and amortization of other intangibles | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring cost | $ 0 | $ 1 | $ 0 | $ 3 |
Environmental Matters, Litiga_3
Environmental Matters, Litigation and Product Warranties - Additional Information (Details) $ in Millions | 9 Months Ended | 15 Months Ended | |
Sep. 30, 2018USD ($)defendentcasefederal_superfund_site | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | |
Environmental Matters, Litigation and Product Warranties [Abstract] | |||
Number of Federal Super Fund sites | federal_superfund_site | 1 | ||
Environmental remediation accrual, discounted basis | $ 17 | $ 17 | |
Portion of environmental remediation costs recorded in other current liabilities | 3 | 3 | |
Portion of environmental remediation costs recorded in deferred credits and other liabilities | $ 14 | $ 14 | |
Weighted average discount rate | 2.60% | 2.60% | |
Environmental remediation accrual, undiscounted basis | $ 21 | $ 21 | |
Environmental Remediation, 2018 | 2 | 2 | |
Environmental Remediation, 2019 | 3 | 3 | |
Environmental Remediation, 2020 | 1 | 1 | |
Environmental Remediation, 2021 | 1 | 1 | |
Environmental Remediation, 2022 | 1 | 1 | |
Environmental Remediation, Thereafter | 13 | 13 | |
Litigation reserve | $ 68 | 68 | $ 132 |
Payments for litigation | $ 64 | ||
Number of legal cases (less than) | case | 500 | ||
Number of defendants in many asbestos related cases | defendent | 100 |
Environmental Matters, Litiga_4
Environmental Matters, Litigation and Product Warranties - Warranty Accrual Rollforward (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward] | ||
Beginning Balance | $ 26 | $ 20 |
Accruals related to product warranties | 13 | 13 |
Reductions for payments made | (11) | (8) |
Ending Balance | $ 28 | $ 25 |
Earnings Per Share - Summary of
Earnings Per Share - Summary of Earnings Per Share of Common Stock (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Basic earnings per share — | ||||
Net income attributable to Tenneco Inc. | $ 54 | $ 83 | $ 162 | $ 139 |
Weighted average shares of common stock outstanding (in shares) | 51,272,618 | 52,508,078 | 51,247,664 | 53,265,149 |
Earnings per share of common stock (in dollars per share) | $ 1.05 | $ 1.57 | $ 3.17 | $ 2.61 |
Diluted earnings per share — | ||||
Net income attributable to Tenneco Inc. | $ 54 | $ 83 | $ 162 | $ 139 |
Weighted average shares of common stock outstanding (in shares) | 51,272,618 | 52,508,078 | 51,247,664 | 53,265,149 |
Effect of dilutive securities: | ||||
Restricted stock, PSUs and RSUs (in shares) | 93,956 | 89,666 | 95,022 | 106,320 |
Stock options (in shares) | 35,255 | 89,912 | 53,241 | 130,395 |
Weighted average shares of common stock outstanding including dilutive securities (in shares) | 51,401,829 | 52,687,656 | 51,395,927 | 53,501,864 |
Earnings per share of common stock (in dollars per share) | $ 1.05 | $ 1.57 | $ 3.16 | $ 2.60 |
Earnings Per Share - Additiona
Earnings Per Share - Additional Information (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Anti-dilutive stock options | 124,865 | 127,359 | 124,606 | 834 |
Common Stock - Additional Infor
Common Stock - Additional Information (Details) - USD ($) | Feb. 01, 2017 | Feb. 28, 2017 | Jan. 31, 2015 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Dec. 31, 2017 | Oct. 31, 2015 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||||||||||||
Impact of earnings per share, basic and diluted (in dollars per share) | $ 0 | $ 0 | $ 0 | $ 0.01 | |||||||||||
Stock-based compensation | $ 5,000,000 | $ 1,000,000 | $ 12,000,000 | $ 12,000,000 | |||||||||||
Tax benefit from options exercised | 1,000,000 | 2,000,000 | |||||||||||||
Total fair value of shares vested | $ 0 | 2,000,000 | |||||||||||||
Treasury stock repurchased | 14,592,888 | 14,592,888 | 14,592,888 | 14,592,888 | |||||||||||
Dividend declared (in dollars per share) | $ 0.25 | ||||||||||||||
Annual divided declared (in dollars per share) | $ 1 | ||||||||||||||
Dividend paid (in dollars per share) | $ 0.25 | $ 0.25 | $ 0.25 | $ 0.25 | $ 0.25 | $ 0.25 | |||||||||
Cash dividends paid | $ 14,000,000 | $ 14,000,000 | $ 39,000,000 | 40,000,000 | |||||||||||
Equity Option | |||||||||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||||||||||||
Compensation expense | 0 | 0 | 0 | 1,000,000 | |||||||||||
Stock Option | |||||||||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||||||||||||
Cash received from stock option exercises | 1,000,000 | 7,000,000 | |||||||||||||
Restricted Stock, Restricted Stock Units, Long Term Performance Units, SARs | |||||||||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||||||||||||
Unrecognized compensation costs | 3,000,000 | $ 3,000,000 | $ 3,000,000 | ||||||||||||
Unrecognized compensation costs, not yet recognized | 1 year 2 months 12 days | ||||||||||||||
Stock-based compensation | 3,000,000 | $ 2,000,000 | $ 7,000,000 | 10,000,000 | |||||||||||
Restricted Shares | |||||||||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||||||||||||
Unrecognized compensation costs | 4,000,000 | $ 4,000,000 | 4,000,000 | ||||||||||||
Unrecognized compensation costs, not yet recognized | 1 year 2 months 12 days | ||||||||||||||
Total fair value of restricted shares vested | $ 11,000,000 | $ 14,000,000 | |||||||||||||
Share-Settled RSUs | |||||||||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||||||||||||
Unrecognized compensation costs | 10,000,000 | $ 10,000,000 | 10,000,000 | ||||||||||||
Unrecognized compensation costs, not yet recognized | 2 years 4 months 24 days | ||||||||||||||
Vesting period | 3 years | ||||||||||||||
PSUs | |||||||||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||||||||||||
Unrecognized compensation costs | $ 8,000,000 | $ 8,000,000 | $ 8,000,000 | ||||||||||||
Unrecognized compensation costs, not yet recognized | 2 years 4 months 24 days | ||||||||||||||
Vesting period | 3 years | ||||||||||||||
Common Stock | |||||||||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||||||||||||
Amount authorized to repurchase | $ 400,000,000 | $ 350,000,000 | $ 200,000,000 | ||||||||||||
Period of time to repurchase common stock | 3 years | 3 years | |||||||||||||
Previous authorized amount to repurchase | $ 112,000,000 | ||||||||||||||
Number of shares repurchased | 11,300,000 | ||||||||||||||
Value of shares reprchased | $ 607,000,000 | ||||||||||||||
Forecast | |||||||||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||||||||||||
Cash dividends paid | $ 20,000,000 |
Common Stock - Stock Options St
Common Stock - Stock Options Status and Activity (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||
Total fair value of shares vested | $ 0 | $ 2,000,000 | ||||
Shares Under Option | ||||||
Outstanding, Beginning Balance (in shares) | 311,041 | 313,409 | 318,016 | 318,016 | ||
Exercised (in shares) | (11,420) | (4,607) | ||||
Forfeited (in shares) | (2,368) | |||||
Outstanding, Ending Balance (in shares) | 299,621 | 311,041 | 313,409 | 299,621 | 318,016 | |
Weighted Avg. Exercise Prices | ||||||
Outstanding, Beginning Balance (in dollars per share) | $ 43.76 | $ 43.84 | $ 43.60 | $ 43.60 | ||
Exercised (in dollars per share) | 29.93 | 26.78 | ||||
Forfeited (in dollars per share) | 54.34 | |||||
Outstanding, Ending Balance (in dollars per share) | $ 44.29 | $ 43.76 | $ 43.84 | $ 44.29 | $ 43.60 | |
Weighted Avg. Remaining Life in Years | 1 year 9 months 18 days | 2 years 1 month 6 days | 2 years 5 months 6 days | 2 years 7 months 6 days | ||
Aggregate Intrinsic Value, Outstanding, Beginning Balance | $ 2,000,000 | $ 4,000,000 | $ 5,000,000 | $ 5,000,000 | ||
Aggregate Intrinsic Value, Exercised | 0 | 0 | 0 | |||
Aggregate Intrinsic Value, Outstanding, Ending Balance | $ 1,000,000 | $ 2,000,000 | $ 4,000,000 | $ 1,000,000 | $ 5,000,000 |
Common Stock - Nonvested Restri
Common Stock - Nonvested Restricted Shares (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | |
Restricted Shares | |||||
Nonvested Restricted Shares | |||||
Nonvested, Beginning Balance (in shares) | 192,831 | 254,174 | 410,251 | 410,251 | |
Granted (in shares) | 0 | 1,573 | 17,440 | ||
Vested (in shares) | (6,443) | (60,434) | (168,409) | ||
Forfeited (in shares) | (1,210) | (2,482) | (5,108) | ||
Nonvested, Ending Balance (in shares) | 185,178 | 192,831 | 254,174 | 185,178 | |
Weighted Avg. Grant Date Fair Value | |||||
Nonvested, Beginning Balance (in dollars per share) | $ 53.14 | $ 52.23 | $ 49.95 | $ 49.95 | |
Granted (in dollars per share) | 0 | 47.97 | 55.05 | ||
Vested (in dollars per share) | 53.31 | 49.89 | 47.08 | ||
Forfeited (in dollars per share) | 62.79 | 57.15 | 48.68 | ||
Nonvested, Ending Balance (in dollars per share) | $ 53.07 | $ 53.14 | $ 52.23 | $ 53.07 | |
Unrecognized compensation costs | $ 4 | $ 4 | |||
Unrecognized compensation costs, not yet recognized | 1 year 2 months 12 days | ||||
Total fair value of restricted shares vested | $ 11 | $ 14 | |||
Share-Settled RSUs | |||||
Nonvested Restricted Shares | |||||
Nonvested, Beginning Balance (in shares) | 260,697 | 251,895 | 0 | 0 | |
Granted (in shares) | 14,903 | 16,995 | 253,257 | ||
Vested (in shares) | 0 | (192) | 0 | ||
Forfeited (in shares) | (6,408) | (8,001) | (1,362) | ||
Nonvested, Ending Balance (in shares) | 269,192 | 260,697 | 251,895 | 269,192 | |
Weighted Avg. Grant Date Fair Value | |||||
Nonvested, Beginning Balance (in dollars per share) | $ 54.51 | $ 55.02 | $ 0 | $ 0 | |
Granted (in dollars per share) | 42.22 | 47.17 | 55.02 | ||
Vested (in dollars per share) | 0 | 55.04 | 0 | ||
Forfeited (in dollars per share) | 55.04 | 55.04 | 55.04 | ||
Nonvested, Ending Balance (in dollars per share) | $ 57.51 | $ 54.51 | $ 55.02 | $ 57.51 | |
Unrecognized compensation costs | $ 10 | $ 10 | |||
Unrecognized compensation costs, not yet recognized | 2 years 4 months 24 days | ||||
PSUs | |||||
Nonvested Restricted Shares | |||||
Nonvested, Beginning Balance (in shares) | 236,254 | 214,348 | 0 | 0 | |
Granted (in shares) | 8,623 | 25,957 | 214,348 | ||
Vested (in shares) | 0 | 0 | 0 | ||
Forfeited (in shares) | (5,882) | (4,051) | 0 | ||
Nonvested, Ending Balance (in shares) | 238,995 | 236,254 | 214,348 | 238,995 | |
Weighted Avg. Grant Date Fair Value | |||||
Nonvested, Beginning Balance (in dollars per share) | $ 49.28 | $ 50.75 | $ 0 | $ 0 | |
Granted (in dollars per share) | 32.24 | 35.64 | 50.75 | ||
Vested (in dollars per share) | 0 | 0 | 0 | ||
Forfeited (in dollars per share) | 50.75 | 50.75 | 0 | ||
Nonvested, Ending Balance (in dollars per share) | $ 48.68 | $ 49.28 | $ 50.75 | $ 48.68 | |
Unrecognized compensation costs | $ 8 | $ 8 | |||
Unrecognized compensation costs, not yet recognized | 2 years 4 months 24 days |
Pension Plans, Postretirement_3
Pension Plans, Postretirement and Other Employee Benefits - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
U.S. | Pension | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost — benefits earned during the period | $ 1 | $ 1 | $ 1 | $ 1 |
Interest cost | 3 | 2 | 8 | 7 |
Expected return on plan assets | (4) | (4) | (11) | (11) |
Settlement loss | 6 | 0 | 6 | |
Net amortization: | ||||
Actuarial loss | 1 | 1 | 3 | 4 |
Prior service credit | 0 | 0 | 0 | 0 |
Net pension and postretirement costs | 1 | 0 | 1 | 7 |
U.S. | Postretirement | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost — benefits earned during the period | 0 | 0 | 0 | 0 |
Interest cost | 2 | 1 | 5 | 4 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Settlement loss | 0 | 0 | ||
Net amortization: | ||||
Actuarial loss | 2 | 2 | 6 | 5 |
Prior service credit | 0 | 0 | (1) | (1) |
Net pension and postretirement costs | 4 | 3 | 10 | 8 |
Foreign | Pension | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost — benefits earned during the period | 3 | 3 | 8 | 7 |
Interest cost | 3 | 4 | 9 | 10 |
Expected return on plan assets | (5) | (4) | (15) | (19) |
Settlement loss | 0 | 0 | ||
Net amortization: | ||||
Actuarial loss | 2 | 1 | 6 | 6 |
Prior service credit | 0 | 1 | 0 | 1 |
Net pension and postretirement costs | $ 3 | $ 5 | $ 8 | $ 5 |
Pension Plans, Postretirement_4
Pension Plans, Postretirement and Other Employee Benefits - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Pension | |||
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | |||
Employer contributions, remainder of fiscal year | $ 5 | ||
Postretirement | |||
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | |||
Employer contributions | 6 | ||
Employer contributions, remainder of fiscal year | 3 | ||
U.S. | Pension | |||
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | |||
Employer contributions | $ 10 | 1 | |
Settlement loss | $ 6 | 0 | $ 6 |
U.S. | Postretirement | |||
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | |||
Settlement loss | 0 | 0 | |
Foreign | Pension | |||
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | |||
Employer contributions | 9 | ||
Settlement loss | $ 0 | $ 0 |
Pension Plans, Postretirement_5
Pension Plans, Postretirement and Other Employee Benefits - Amounts Recognized for Pension and Postretirement Benefits in Other Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Before-Tax Amount | ||||
Amortization of prior service cost included in net periodic pension and postretirement costs | $ 0 | $ 1 | $ (1) | $ 0 |
Amortization of actuarial loss included in net periodic pension and postretirement costs | 5 | 4 | 15 | 15 |
Settlement charge | 0 | 6 | ||
Other comprehensive income – pension benefits | 5 | 5 | 14 | 21 |
Tax Benefit | ||||
Amortization of prior service cost included in net periodic pension and postretirement costs | 0 | 0 | 0 | 0 |
Amortization of actuarial loss included in net periodic pension and postretirement costs | (1) | (2) | (3) | (5) |
Settlement charge | 0 | (2) | ||
Other comprehensive income – pension benefits | (1) | (2) | (3) | (7) |
Net-of-Tax Amount | ||||
Amortization of prior service cost included in net periodic pension and postretirement costs | 0 | 1 | (1) | 0 |
Amortization of actuarial loss included in net periodic pension and postretirement costs | 4 | 2 | 12 | 10 |
Settlement charge | 0 | 4 | ||
Other comprehensive income – pension benefits | $ 4 | $ 3 | $ 11 | $ 14 |
New Accounting Pronouncements_2
New Accounting Pronouncements (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Other pension and postretirement costs | $ 4 | $ 3 | $ 10 | $ 10 |
Non-cash expense, pension and postretirement | 6 | |||
Proceeds from deferred purchase price of factored receivables | $ 36 | $ 28 | 102 | $ 77 |
ASU 2016-16 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative effect on retained earnings, increase (decrease) | $ (2) |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2018Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Segment Reporting [Line Items] | |||||
Revenues from external customers | $ 2,372 | $ 2,274 | $ 7,483 | $ 6,883 | |
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests | 104 | 134 | 334 | 282 | |
Total assets | 5,028 | 4,935 | 5,028 | 4,935 | $ 4,842 |
Intersegment Revenues | |||||
Segment Reporting [Line Items] | |||||
Intersegment revenues | 0 | 0 | 0 | 0 | |
Operating Segments | |||||
Segment Reporting [Line Items] | |||||
Revenues from external customers | 2,372 | 2,274 | 7,483 | 6,883 | |
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests | 144 | 157 | 466 | 498 | |
Total assets | 4,972 | 4,876 | 4,972 | 4,876 | |
Operating Segments | Intersegment Revenues | |||||
Segment Reporting [Line Items] | |||||
Intersegment revenues | 42 | 37 | 122 | 128 | |
Reclass and Elims | |||||
Segment Reporting [Line Items] | |||||
Revenues from external customers | 0 | 0 | 0 | 0 | |
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests | 0 | 0 | 0 | 0 | |
Total assets | 56 | 59 | 56 | 59 | |
Reclass and Elims | Intersegment Revenues | |||||
Segment Reporting [Line Items] | |||||
Intersegment revenues | (42) | (37) | (122) | (128) | |
Clean Air Division | Operating Segments | |||||
Segment Reporting [Line Items] | |||||
Revenues from external customers | 1,602 | 1,495 | 5,052 | 4,589 | |
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests | 104 | 100 | 328 | 300 | |
Total assets | 3,008 | 2,912 | 3,008 | 2,912 | |
Clean Air Division | Operating Segments | Intersegment Revenues | |||||
Segment Reporting [Line Items] | |||||
Intersegment revenues | 14 | 11 | 42 | 53 | |
Ride Performance Division | Operating Segments | |||||
Segment Reporting [Line Items] | |||||
Revenues from external customers | 461 | 457 | 1,480 | 1,327 | |
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests | (5) | 7 | 8 | 52 | |
Total assets | 1,079 | 1,100 | 1,079 | 1,100 | |
Ride Performance Division | Operating Segments | Intersegment Revenues | |||||
Segment Reporting [Line Items] | |||||
Intersegment revenues | 16 | 18 | 45 | 46 | |
Aftermarket | Operating Segments | |||||
Segment Reporting [Line Items] | |||||
Revenues from external customers | 309 | 322 | 951 | 967 | |
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests | 45 | 50 | 130 | 146 | |
Total assets | 885 | 864 | 885 | 864 | |
Aftermarket | Operating Segments | Intersegment Revenues | |||||
Segment Reporting [Line Items] | |||||
Intersegment revenues | 12 | 8 | 35 | 29 | |
Other | |||||
Segment Reporting [Line Items] | |||||
Revenues from external customers | 0 | 0 | 0 | 0 | |
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests | (40) | (23) | (132) | (216) | |
Total assets | 0 | 0 | 0 | 0 | |
Other | Intersegment Revenues | |||||
Segment Reporting [Line Items] | |||||
Intersegment revenues | $ 0 | $ 0 | $ 0 | $ 0 |
Supplemental Guarantor Conden_3
Supplemental Guarantor Condensed Consolidating Financial Statements - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2018 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Ownership percentage of existing and future material domestic owned subsidiaries | 100.00% |
Supplemental Guarantor Conden_4
Supplemental Guarantor Condensed Consolidating Financial Statements - Statement of Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Net sales and operating revenues — | ||||
External | $ 2,372 | $ 2,274 | $ 7,483 | $ 6,883 |
Affiliated companies | 0 | 0 | 0 | 0 |
Net sales and operating revenues | 2,372 | 2,274 | 7,483 | 6,883 |
Costs and expenses | ||||
Cost of sales (exclusive of depreciation and amortization shown below) | 2,014 | 1,911 | 6,371 | 5,789 |
Engineering, research, and development | 39 | 40 | 122 | 115 |
Selling, general, and administrative | 141 | 127 | 450 | 520 |
Depreciation and amortization of other intangibles | 65 | 58 | 183 | 165 |
Total costs and expenses | 2,259 | 2,136 | 7,126 | 6,589 |
Other expense (income) | ||||
Loss on sale of receivables | 3 | 2 | 8 | 4 |
Other income (expense) | 6 | 2 | 15 | 8 |
Total other income (expense) | 9 | 4 | 23 | 12 |
Earnings before interest expense, income taxes, and noncontrolling interests | 104 | 134 | 334 | 282 |
Interest expense — | ||||
External (net of interest capitalized) | 21 | 19 | 61 | 54 |
Affiliated companies (net of interest income) | 0 | 0 | 0 | 0 |
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies | 83 | 115 | 273 | 228 |
Income tax (benefit) expense | 20 | 16 | 72 | 41 |
Equity in net income from affiliated companies | 0 | 0 | 0 | 0 |
Net income | 63 | 99 | 201 | 187 |
Less: Net income attributable to noncontrolling interests | 9 | 16 | 39 | 48 |
Net income attributable to Tenneco Inc. | 54 | 83 | 162 | 139 |
Comprehensive income (loss) attributable to Tenneco Inc. | 30 | 114 | 71 | 234 |
Reclass and Elims | ||||
Net sales and operating revenues — | ||||
External | 0 | 0 | 0 | 0 |
Affiliated companies | (297) | (271) | (866) | (910) |
Net sales and operating revenues | (297) | (271) | (866) | (910) |
Costs and expenses | ||||
Cost of sales (exclusive of depreciation and amortization shown below) | (297) | (271) | (866) | (910) |
Engineering, research, and development | 0 | 0 | 0 | 0 |
Selling, general, and administrative | 0 | 0 | 0 | 0 |
Depreciation and amortization of other intangibles | 0 | 0 | 0 | 0 |
Total costs and expenses | (297) | (271) | (866) | (910) |
Other expense (income) | ||||
Loss on sale of receivables | 0 | 0 | 0 | 0 |
Other income (expense) | 6 | 0 | 16 | 15 |
Total other income (expense) | 6 | 0 | 16 | 15 |
Earnings before interest expense, income taxes, and noncontrolling interests | (6) | 0 | (16) | (15) |
Interest expense — | ||||
External (net of interest capitalized) | 0 | 0 | 0 | 0 |
Affiliated companies (net of interest income) | 0 | 0 | 0 | 0 |
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies | (6) | 0 | (16) | (15) |
Income tax (benefit) expense | 0 | 0 | 0 | 0 |
Equity in net income from affiliated companies | (106) | (126) | (324) | (304) |
Net income | (112) | (126) | (340) | (319) |
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | 0 |
Net income attributable to Tenneco Inc. | (112) | (126) | (340) | (319) |
Comprehensive income (loss) attributable to Tenneco Inc. | (112) | (120) | (340) | (313) |
Guarantor Subsidiaries | ||||
Net sales and operating revenues — | ||||
External | 990 | 917 | 3,050 | 2,958 |
Affiliated companies | 145 | 128 | 402 | 413 |
Net sales and operating revenues | 1,135 | 1,045 | 3,452 | 3,371 |
Costs and expenses | ||||
Cost of sales (exclusive of depreciation and amortization shown below) | 962 | 887 | 2,956 | 2,865 |
Engineering, research, and development | 20 | 17 | 57 | 56 |
Selling, general, and administrative | 67 | 50 | 222 | 301 |
Depreciation and amortization of other intangibles | 30 | 23 | 74 | 65 |
Total costs and expenses | 1,079 | 977 | 3,309 | 3,287 |
Other expense (income) | ||||
Loss on sale of receivables | 1 | 1 | 5 | 2 |
Other income (expense) | 10 | 12 | 40 | 24 |
Total other income (expense) | 11 | 13 | 45 | 26 |
Earnings before interest expense, income taxes, and noncontrolling interests | 45 | 55 | 98 | 58 |
Interest expense — | ||||
External (net of interest capitalized) | 9 | 7 | 25 | 10 |
Affiliated companies (net of interest income) | (4) | (5) | (11) | (12) |
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies | 40 | 53 | 84 | 60 |
Income tax (benefit) expense | 10 | (5) | 9 | 6 |
Equity in net income from affiliated companies | 38 | 31 | 122 | 119 |
Net income | 68 | 89 | 197 | 173 |
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | 0 |
Net income attributable to Tenneco Inc. | 68 | 89 | 197 | 173 |
Comprehensive income (loss) attributable to Tenneco Inc. | 68 | 89 | 197 | 173 |
Non-Guarantor Subsidiaries | ||||
Net sales and operating revenues — | ||||
External | 1,382 | 1,357 | 4,433 | 3,925 |
Affiliated companies | 152 | 143 | 464 | 497 |
Net sales and operating revenues | 1,534 | 1,500 | 4,897 | 4,422 |
Costs and expenses | ||||
Cost of sales (exclusive of depreciation and amortization shown below) | 1,349 | 1,295 | 4,281 | 3,834 |
Engineering, research, and development | 19 | 23 | 65 | 59 |
Selling, general, and administrative | 74 | 77 | 228 | 219 |
Depreciation and amortization of other intangibles | 35 | 35 | 109 | 100 |
Total costs and expenses | 1,477 | 1,430 | 4,683 | 4,212 |
Other expense (income) | ||||
Loss on sale of receivables | 2 | 1 | 3 | 2 |
Other income (expense) | (10) | (10) | (41) | (31) |
Total other income (expense) | (8) | (9) | (38) | (29) |
Earnings before interest expense, income taxes, and noncontrolling interests | 65 | 79 | 252 | 239 |
Interest expense — | ||||
External (net of interest capitalized) | 2 | 2 | 7 | 4 |
Affiliated companies (net of interest income) | 0 | 3 | 0 | 6 |
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies | 63 | 74 | 245 | 229 |
Income tax (benefit) expense | 10 | 21 | 63 | 35 |
Equity in net income from affiliated companies | 0 | 0 | 0 | 0 |
Net income | 53 | 53 | 182 | 194 |
Less: Net income attributable to noncontrolling interests | 9 | 16 | 39 | 48 |
Net income attributable to Tenneco Inc. | 44 | 37 | 143 | 146 |
Comprehensive income (loss) attributable to Tenneco Inc. | 44 | 31 | 143 | 140 |
Tenneco Inc | ||||
Net sales and operating revenues — | ||||
External | 0 | 0 | 0 | 0 |
Affiliated companies | 0 | 0 | 0 | |
Net sales and operating revenues | 0 | 0 | 0 | 0 |
Costs and expenses | ||||
Cost of sales (exclusive of depreciation and amortization shown below) | 0 | 0 | 0 | 0 |
Engineering, research, and development | 0 | 0 | 0 | 0 |
Selling, general, and administrative | 0 | 0 | 0 | 0 |
Depreciation and amortization of other intangibles | 0 | 0 | 0 | 0 |
Total costs and expenses | 0 | 0 | 0 | 0 |
Other expense (income) | ||||
Loss on sale of receivables | 0 | 0 | 0 | 0 |
Other income (expense) | 0 | 0 | 0 | 0 |
Total other income (expense) | 0 | 0 | 0 | 0 |
Earnings before interest expense, income taxes, and noncontrolling interests | 0 | 0 | 0 | 0 |
Interest expense — | ||||
External (net of interest capitalized) | 10 | 10 | 29 | 40 |
Affiliated companies (net of interest income) | 4 | 2 | 11 | 6 |
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies | (14) | (12) | (40) | (46) |
Income tax (benefit) expense | 0 | 0 | 0 | 0 |
Equity in net income from affiliated companies | 68 | 95 | 202 | 185 |
Net income | 54 | 83 | 162 | 139 |
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | 0 |
Net income attributable to Tenneco Inc. | 54 | 83 | 162 | 139 |
Comprehensive income (loss) attributable to Tenneco Inc. | $ 30 | $ 114 | $ 71 | $ 234 |
Supplemental Guarantor Conden_5
Supplemental Guarantor Condensed Consolidating Financial Statements - Balance Sheet (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | |||||
Cash and cash equivalents | $ 202 | $ 315 | |||
Restricted cash | 1 | 3 | |||
Receivables, net | 1,408 | 1,321 | |||
Inventories | 956 | $ 864 | 869 | ||
Prepayments and other | 369 | $ 297 | 291 | ||
Total current assets | 2,936 | 2,799 | |||
Other assets: | |||||
Investment in affiliated companies | 0 | 0 | |||
Notes and advances receivable from affiliates | 0 | 0 | |||
Long-term receivables, net | 12 | 9 | |||
Goodwill | 47 | 49 | |||
Intangibles, net | 20 | 22 | |||
Deferred income taxes | 227 | 204 | |||
Other | 154 | 144 | |||
Total other assets | 460 | 428 | |||
Plant, property, and equipment, at cost | 4,068 | 4,008 | |||
Less — Accumulated depreciation and amortization | (2,436) | (2,393) | |||
Plant, property and equipment, net | 1,632 | 1,615 | |||
Total assets | 5,028 | 4,842 | $ 4,935 | ||
Short-term debt (including current maturities of long-term debt): | |||||
Short-term debt — non-affiliated | 240 | 83 | |||
Short-term debt — affiliated | 0 | 0 | |||
Accounts payable | 1,769 | 1,705 | |||
Accrued taxes | 38 | 45 | |||
Other | 445 | 433 | |||
Total current liabilities | 2,492 | 2,266 | |||
Long-term debt — non-affiliated | 1,304 | 1,358 | |||
Long-term debt — affiliated | 0 | 0 | |||
Deferred income taxes | 11 | 11 | |||
Pension, postretirement benefits and other liabilities | 418 | 423 | |||
Total liabilities | 4,225 | 4,058 | |||
Redeemable noncontrolling interests | 28 | 42 | 32 | $ 40 | |
Tenneco Inc. shareholders’ equity | 737 | 696 | |||
Noncontrolling interests | 38 | 46 | |||
Total equity | 775 | 742 | $ 686 | ||
Total liabilities, redeemable noncontrolling interests and equity | 5,028 | 4,842 | |||
Reclass and Elims | |||||
Current assets: | |||||
Cash and cash equivalents | 0 | 0 | |||
Restricted cash | 0 | 0 | |||
Receivables, net | (733) | (648) | |||
Inventories | 0 | 0 | |||
Prepayments and other | 0 | 0 | |||
Total current assets | (733) | (648) | |||
Other assets: | |||||
Investment in affiliated companies | (2,742) | (2,647) | |||
Notes and advances receivable from affiliates | (25,888) | (23,877) | |||
Long-term receivables, net | 0 | 0 | |||
Goodwill | 0 | 0 | |||
Intangibles, net | 0 | 0 | |||
Deferred income taxes | 0 | 0 | |||
Other | 0 | 0 | |||
Total other assets | (28,630) | (26,524) | |||
Plant, property, and equipment, at cost | 0 | 0 | |||
Less — Accumulated depreciation and amortization | 0 | 0 | |||
Plant, property and equipment, net | 0 | 0 | |||
Total assets | (29,363) | (27,172) | |||
Short-term debt (including current maturities of long-term debt): | |||||
Short-term debt — non-affiliated | 0 | 0 | |||
Short-term debt — affiliated | (615) | (556) | |||
Accounts payable | (112) | (89) | |||
Accrued taxes | 0 | 0 | |||
Other | (6) | (3) | |||
Total current liabilities | (733) | (648) | |||
Long-term debt — non-affiliated | 0 | 0 | |||
Long-term debt — affiliated | (25,888) | (23,877) | |||
Deferred income taxes | 0 | 0 | |||
Pension, postretirement benefits and other liabilities | 0 | 0 | |||
Total liabilities | (26,621) | (24,525) | |||
Redeemable noncontrolling interests | 0 | 0 | |||
Tenneco Inc. shareholders’ equity | (2,742) | (2,647) | |||
Noncontrolling interests | 0 | 0 | |||
Total equity | (2,742) | (2,647) | |||
Total liabilities, redeemable noncontrolling interests and equity | (29,363) | (27,172) | |||
Guarantor Subsidiaries | |||||
Current assets: | |||||
Cash and cash equivalents | 5 | 7 | |||
Restricted cash | 0 | 0 | |||
Receivables, net | 434 | 402 | |||
Inventories | 414 | 383 | |||
Prepayments and other | 139 | 99 | |||
Total current assets | 992 | 891 | |||
Other assets: | |||||
Investment in affiliated companies | 1,385 | 1,389 | |||
Notes and advances receivable from affiliates | 801 | 791 | |||
Long-term receivables, net | 12 | 8 | |||
Goodwill | 22 | 22 | |||
Intangibles, net | 5 | 5 | |||
Deferred income taxes | 171 | 161 | |||
Other | 63 | 66 | |||
Total other assets | 2,459 | 2,442 | |||
Plant, property, and equipment, at cost | 1,564 | 1,478 | |||
Less — Accumulated depreciation and amortization | (978) | (934) | |||
Plant, property and equipment, net | 586 | 544 | |||
Total assets | 4,037 | 3,877 | |||
Short-term debt (including current maturities of long-term debt): | |||||
Short-term debt — non-affiliated | 0 | 0 | |||
Short-term debt — affiliated | 458 | 408 | |||
Accounts payable | 724 | 562 | |||
Accrued taxes | 4 | 8 | |||
Other | 210 | 203 | |||
Total current liabilities | 1,396 | 1,181 | |||
Long-term debt — non-affiliated | 580 | 632 | |||
Long-term debt — affiliated | 1,061 | 1,093 | |||
Deferred income taxes | 0 | 0 | |||
Pension, postretirement benefits and other liabilities | 298 | 296 | |||
Total liabilities | 3,335 | 3,202 | |||
Redeemable noncontrolling interests | 0 | 0 | |||
Tenneco Inc. shareholders’ equity | 702 | 675 | |||
Noncontrolling interests | 0 | 0 | |||
Total equity | 702 | 675 | |||
Total liabilities, redeemable noncontrolling interests and equity | 4,037 | 3,877 | |||
Nonguarantor Subsidiaries | |||||
Current assets: | |||||
Cash and cash equivalents | 197 | 308 | |||
Restricted cash | 1 | 3 | |||
Receivables, net | 1,707 | 1,567 | |||
Inventories | 542 | 486 | |||
Prepayments and other | 230 | 192 | |||
Total current assets | 2,677 | 2,556 | |||
Other assets: | |||||
Investment in affiliated companies | 0 | 0 | |||
Notes and advances receivable from affiliates | 20,907 | 19,119 | |||
Long-term receivables, net | 0 | 1 | |||
Goodwill | 25 | 27 | |||
Intangibles, net | 15 | 17 | |||
Deferred income taxes | 56 | 43 | |||
Other | 91 | 78 | |||
Total other assets | 21,094 | 19,285 | |||
Plant, property, and equipment, at cost | 2,504 | 2,530 | |||
Less — Accumulated depreciation and amortization | (1,458) | (1,459) | |||
Plant, property and equipment, net | 1,046 | 1,071 | |||
Total assets | 24,817 | 22,912 | |||
Short-term debt (including current maturities of long-term debt): | |||||
Short-term debt — non-affiliated | 225 | 83 | |||
Short-term debt — affiliated | 157 | 148 | |||
Accounts payable | 1,157 | 1,232 | |||
Accrued taxes | 34 | 37 | |||
Other | 232 | 221 | |||
Total current liabilities | 1,805 | 1,721 | |||
Long-term debt — non-affiliated | 9 | 12 | |||
Long-term debt — affiliated | 20,766 | 18,981 | |||
Deferred income taxes | 11 | 11 | |||
Pension, postretirement benefits and other liabilities | 120 | 127 | |||
Total liabilities | 22,711 | 20,852 | |||
Redeemable noncontrolling interests | 28 | 42 | |||
Tenneco Inc. shareholders’ equity | 2,040 | 1,972 | |||
Noncontrolling interests | 38 | 46 | |||
Total equity | 2,078 | 2,018 | |||
Total liabilities, redeemable noncontrolling interests and equity | 24,817 | 22,912 | |||
Tenneco Inc | |||||
Current assets: | |||||
Cash and cash equivalents | 0 | 0 | |||
Restricted cash | 0 | 0 | |||
Receivables, net | 0 | 0 | |||
Inventories | 0 | 0 | |||
Prepayments and other | 0 | 0 | |||
Total current assets | 0 | 0 | |||
Other assets: | |||||
Investment in affiliated companies | 1,357 | 1,258 | |||
Notes and advances receivable from affiliates | 4,180 | 3,967 | |||
Long-term receivables, net | 0 | 0 | |||
Goodwill | 0 | 0 | |||
Intangibles, net | 0 | 0 | |||
Deferred income taxes | 0 | 0 | |||
Other | 0 | 0 | |||
Total other assets | 5,537 | 5,225 | |||
Plant, property, and equipment, at cost | 0 | 0 | |||
Less — Accumulated depreciation and amortization | 0 | 0 | |||
Plant, property and equipment, net | 0 | 0 | |||
Total assets | 5,537 | 5,225 | |||
Short-term debt (including current maturities of long-term debt): | |||||
Short-term debt — non-affiliated | 15 | 0 | |||
Short-term debt — affiliated | 0 | 0 | |||
Accounts payable | 0 | 0 | |||
Accrued taxes | 0 | 0 | |||
Other | 9 | 12 | |||
Total current liabilities | 24 | 12 | |||
Long-term debt — non-affiliated | 715 | 714 | |||
Long-term debt — affiliated | 4,061 | 3,803 | |||
Deferred income taxes | 0 | 0 | |||
Pension, postretirement benefits and other liabilities | 0 | 0 | |||
Total liabilities | 4,800 | 4,529 | |||
Redeemable noncontrolling interests | 0 | 0 | |||
Tenneco Inc. shareholders’ equity | 737 | 696 | |||
Noncontrolling interests | 0 | 0 | |||
Total equity | 737 | 696 | |||
Total liabilities, redeemable noncontrolling interests and equity | $ 5,537 | $ 5,225 |
Supplemental Guarantor Conden_6
Supplemental Guarantor Condensed Consolidating Financial Statements - Statement of Cash Flows (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Operating Activities | ||||
Net cash provided (used) by operating activities | $ (41) | $ 25 | $ 37 | $ 86 |
Investing Activities | ||||
Proceeds from sale of assets | 1 | 0 | 6 | 6 |
Proceeds from sale of equity interest | 0 | 0 | 0 | 9 |
Cash payments for plant, property, and equipment | (78) | (90) | (242) | (283) |
Cash payments for software related intangible assets | (3) | (5) | (13) | (17) |
Proceeds from deferred purchase price of factored receivables | 36 | 28 | 102 | 77 |
Other | (4) | (1) | (2) | (5) |
Net cash used by investing activities | (48) | (68) | (149) | (213) |
Financing Activities | ||||
(Repurchase) issuance of common shares | (1) | 1 | (2) | (2) |
Cash dividends | (14) | (14) | (39) | (40) |
Payments of long-term debt | (5) | (1) | (17) | (9) |
Issuance of long-term debt | 0 | 0 | 0 | 136 |
Debt issuance cost of long-term debt | 0 | 0 | (2) | (8) |
Purchase of common stock under the share repurchase program | 0 | (71) | 0 | (131) |
Net increase (decrease) in bank overdrafts | 2 | (3) | (5) | (12) |
Net (decrease) increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable | (77) | 84 | (29) | 144 |
Net increase in short-term borrowings secured by accounts receivable | 170 | 0 | 150 | 20 |
Intercompany dividend payments and net increase (decrease) in intercompany obligations | 0 | 0 | 0 | 0 |
Distributions to noncontrolling interest partners | (16) | (12) | (44) | (45) |
Net cash (used) provided by financing activities | 59 | (16) | 12 | 53 |
Effect of foreign exchange rate changes on cash and cash equivalents | (4) | 3 | (15) | 4 |
Decrease in cash, cash equivalents and restricted cash | (34) | (56) | (115) | (70) |
Cash, cash equivalents and restricted cash, beginning of period | 237 | 335 | 318 | 349 |
Cash, cash equivalents and restricted cash, end of period (Note) | 203 | 279 | 203 | 279 |
Reclass and Elims | ||||
Operating Activities | ||||
Net cash provided (used) by operating activities | (3) | (4) | (12) | (11) |
Investing Activities | ||||
Proceeds from sale of assets | 0 | 0 | 0 | |
Proceeds from sale of equity interest | 0 | |||
Cash payments for plant, property, and equipment | 0 | 0 | 0 | 0 |
Cash payments for software related intangible assets | 0 | 0 | 0 | 0 |
Proceeds from deferred purchase price of factored receivables | 0 | 0 | 0 | 0 |
Other | 0 | 0 | 0 | 0 |
Net cash used by investing activities | 0 | 0 | 0 | 0 |
Financing Activities | ||||
(Repurchase) issuance of common shares | 0 | 0 | 0 | 0 |
Cash dividends | 0 | 0 | 0 | 0 |
Payments of long-term debt | 0 | 0 | 0 | 0 |
Issuance of long-term debt | 0 | |||
Debt issuance cost of long-term debt | 0 | 0 | ||
Purchase of common stock under the share repurchase program | 0 | 0 | ||
Net increase (decrease) in bank overdrafts | 0 | 0 | 0 | 0 |
Net (decrease) increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable | 0 | 0 | 0 | 0 |
Net increase in short-term borrowings secured by accounts receivable | 0 | 0 | 0 | |
Intercompany dividend payments and net increase (decrease) in intercompany obligations | 3 | 4 | 12 | 11 |
Distributions to noncontrolling interest partners | 0 | 0 | 0 | 0 |
Net cash (used) provided by financing activities | 3 | 4 | 12 | 11 |
Effect of foreign exchange rate changes on cash and cash equivalents | 0 | 0 | 0 | 0 |
Decrease in cash, cash equivalents and restricted cash | 0 | 0 | 0 | 0 |
Cash, cash equivalents and restricted cash, beginning of period | 0 | 0 | 0 | 0 |
Cash, cash equivalents and restricted cash, end of period (Note) | 0 | 0 | 0 | 0 |
Guarantor Subsidiaries | ||||
Operating Activities | ||||
Net cash provided (used) by operating activities | 111 | 39 | 190 | 102 |
Investing Activities | ||||
Proceeds from sale of assets | 0 | 1 | 3 | |
Proceeds from sale of equity interest | 0 | |||
Cash payments for plant, property, and equipment | (29) | (29) | (100) | (110) |
Cash payments for software related intangible assets | (1) | (4) | (7) | (10) |
Proceeds from deferred purchase price of factored receivables | 0 | 0 | 0 | 0 |
Other | (4) | (1) | (2) | (5) |
Net cash used by investing activities | (34) | (34) | (108) | (122) |
Financing Activities | ||||
(Repurchase) issuance of common shares | 0 | 0 | 0 | 0 |
Cash dividends | 0 | 0 | 0 | 0 |
Payments of long-term debt | (5) | 0 | (14) | 0 |
Issuance of long-term debt | 400 | |||
Debt issuance cost of long-term debt | (2) | (8) | ||
Purchase of common stock under the share repurchase program | 0 | 0 | ||
Net increase (decrease) in bank overdrafts | 0 | 0 | 0 | 0 |
Net (decrease) increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable | (243) | 82 | (189) | 451 |
Net increase in short-term borrowings secured by accounts receivable | 170 | 150 | 0 | |
Intercompany dividend payments and net increase (decrease) in intercompany obligations | 4 | (87) | (28) | (828) |
Distributions to noncontrolling interest partners | 0 | 0 | 0 | 0 |
Net cash (used) provided by financing activities | (74) | (5) | (83) | 15 |
Effect of foreign exchange rate changes on cash and cash equivalents | 0 | 0 | 0 | 0 |
Decrease in cash, cash equivalents and restricted cash | 3 | 0 | (1) | (5) |
Cash, cash equivalents and restricted cash, beginning of period | 3 | 4 | 7 | 9 |
Cash, cash equivalents and restricted cash, end of period (Note) | 6 | 4 | 6 | 4 |
Non-Guarantor Subsidiaries | ||||
Operating Activities | ||||
Net cash provided (used) by operating activities | (145) | (2) | (132) | 24 |
Investing Activities | ||||
Proceeds from sale of assets | 1 | 5 | 3 | |
Proceeds from sale of equity interest | 9 | |||
Cash payments for plant, property, and equipment | (49) | (61) | (142) | (173) |
Cash payments for software related intangible assets | (2) | (1) | (6) | (7) |
Proceeds from deferred purchase price of factored receivables | 36 | 28 | 102 | 77 |
Other | 0 | 0 | 0 | 0 |
Net cash used by investing activities | (14) | (34) | (41) | (91) |
Financing Activities | ||||
(Repurchase) issuance of common shares | 0 | 0 | 0 | 0 |
Cash dividends | 0 | 0 | 0 | 0 |
Payments of long-term debt | 0 | (1) | (3) | (3) |
Issuance of long-term debt | 0 | |||
Debt issuance cost of long-term debt | 0 | 0 | ||
Purchase of common stock under the share repurchase program | 0 | 0 | ||
Net increase (decrease) in bank overdrafts | 2 | (3) | (5) | (12) |
Net (decrease) increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable | 164 | 2 | 144 | 16 |
Net increase in short-term borrowings secured by accounts receivable | 0 | 0 | 0 | |
Intercompany dividend payments and net increase (decrease) in intercompany obligations | (24) | (9) | (18) | 42 |
Distributions to noncontrolling interest partners | (16) | (12) | (44) | (45) |
Net cash (used) provided by financing activities | 126 | (23) | 74 | (2) |
Effect of foreign exchange rate changes on cash and cash equivalents | (4) | 3 | (15) | 4 |
Decrease in cash, cash equivalents and restricted cash | (37) | (56) | (114) | (65) |
Cash, cash equivalents and restricted cash, beginning of period | 234 | 331 | 311 | 340 |
Cash, cash equivalents and restricted cash, end of period (Note) | 197 | 275 | 197 | 275 |
Tenneco Inc | ||||
Operating Activities | ||||
Net cash provided (used) by operating activities | (4) | (8) | (9) | (29) |
Investing Activities | ||||
Proceeds from sale of assets | 0 | 0 | 0 | |
Proceeds from sale of equity interest | 0 | |||
Cash payments for plant, property, and equipment | 0 | 0 | 0 | 0 |
Cash payments for software related intangible assets | 0 | 0 | 0 | 0 |
Proceeds from deferred purchase price of factored receivables | 0 | 0 | 0 | 0 |
Other | 0 | 0 | 0 | 0 |
Net cash used by investing activities | 0 | 0 | 0 | 0 |
Financing Activities | ||||
(Repurchase) issuance of common shares | (1) | 1 | (2) | (2) |
Cash dividends | (14) | (14) | (39) | (40) |
Payments of long-term debt | 0 | 0 | 0 | (6) |
Issuance of long-term debt | (264) | |||
Debt issuance cost of long-term debt | 0 | 0 | ||
Purchase of common stock under the share repurchase program | (71) | (131) | ||
Net increase (decrease) in bank overdrafts | 0 | 0 | 0 | 0 |
Net (decrease) increase in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable | 2 | 0 | 16 | (323) |
Net increase in short-term borrowings secured by accounts receivable | 0 | 0 | 20 | |
Intercompany dividend payments and net increase (decrease) in intercompany obligations | 17 | 92 | 34 | 775 |
Distributions to noncontrolling interest partners | 0 | 0 | 0 | 0 |
Net cash (used) provided by financing activities | 4 | 8 | 9 | 29 |
Effect of foreign exchange rate changes on cash and cash equivalents | 0 | 0 | 0 | 0 |
Decrease in cash, cash equivalents and restricted cash | 0 | 0 | 0 | 0 |
Cash, cash equivalents and restricted cash, beginning of period | 0 | 0 | 0 | 0 |
Cash, cash equivalents and restricted cash, end of period (Note) | $ 0 | $ 0 | $ 0 | $ 0 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Jan. 01, 2018 | Dec. 31, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Net sales and operating revenues | $ 2,372 | $ 2,274 | $ 7,483 | $ 6,883 | ||
Cost of sales (exclusive of depreciation and amortization shown below) | 2,014 | 1,911 | 6,371 | 5,789 | ||
Inventory | 956 | 956 | $ 864 | $ 869 | ||
Prepayments and other (including contract assets) | 369 | 369 | 297 | 291 | ||
Accrued liabilities | 299 | 299 | 287 | |||
Retained earnings (accumulated deficit) | (823) | (823) | (947) | (946) | ||
Increase in inventories | (65) | (56) | (118) | (116) | ||
Increase in prepayments and other current assets | (21) | (8) | (91) | (76) | ||
(Decrease) increase in other current liabilities | (19) | $ (51) | 11 | $ 101 | ||
Calculated under Revenue Guidance in Effect before Adjustments | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Net sales and operating revenues | 2,372 | 7,481 | ||||
Cost of sales (exclusive of depreciation and amortization shown below) | 2,014 | 6,369 | ||||
Inventory | 963 | 963 | 869 | |||
Prepayments and other (including contract assets) | 349 | 349 | 291 | |||
Accrued liabilities | 287 | 287 | ||||
Retained earnings (accumulated deficit) | (824) | (824) | $ (946) | |||
Increase in inventories | (64) | (125) | ||||
Increase in prepayments and other current assets | (21) | (71) | ||||
(Decrease) increase in other current liabilities | (20) | (1) | ||||
Adjustments due to ASU 2014-09 | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Retained earnings (accumulated deficit) | 1 | |||||
Adjustments due to ASU 2014-09 | Difference between Revenue Guidance in Effect before and after Adjustments | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Net sales and operating revenues | 0 | 2 | ||||
Cost of sales (exclusive of depreciation and amortization shown below) | 0 | 2 | ||||
Inventory | (7) | (7) | (5) | |||
Prepayments and other (including contract assets) | 20 | 20 | 6 | |||
Accrued liabilities | 12 | 12 | ||||
Retained earnings (accumulated deficit) | 1 | 1 | ||||
Increase in inventories | (1) | 7 | ||||
Increase in prepayments and other current assets | 0 | (20) | ||||
(Decrease) increase in other current liabilities | 1 | 12 | ||||
Adjustments due to ASU 2016-16 (a) | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Inventory | 0 | |||||
Prepayments and other (including contract assets) | 0 | |||||
Retained earnings (accumulated deficit) | $ (2) | |||||
Transferred over Time | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Revenue recognized | $ 1 | $ 2 |
Revenue - Segment Revenue (Deta
Revenue - Segment Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales and operating revenues | $ 2,372 | $ 2,274 | $ 7,483 | $ 6,883 |
Substrate Sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales and operating revenues | 596 | $ 522 | 1,869 | $ 1,610 |
Value-Add Revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales and operating revenues | 1,776 | 5,614 | ||
Clean Air Division | Substrate Sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales and operating revenues | 596 | 1,869 | ||
Clean Air Division | Value-Add Revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales and operating revenues | 1,006 | 3,183 | ||
Ride Performance Division | Substrate Sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales and operating revenues | 0 | 0 | ||
Ride Performance Division | Value-Add Revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales and operating revenues | 461 | 1,480 | ||
Aftermarket | Substrate Sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales and operating revenues | 0 | 0 | ||
Aftermarket | Value-Add Revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales and operating revenues | $ 309 | $ 951 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | Oct. 26, 2018 | Oct. 01, 2018 | Dec. 31, 2018 |
Federal-Mogul | Subsequent event | |||
Subsequent Event [Line Items] | |||
Business Acquisition, Revenue Reported by Acquired Entity for Last Annual Period | $ 7,900 | ||
Total consideration | 5,200 | ||
Line of Credit | Subsequent event | |||
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | 4,900 | ||
Revolving Credit Facility | Line of Credit | Subsequent event | |||
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | $ 1,500 | ||
Debt term | 5 years | ||
Term Loan A Facility | Term Loan | Subsequent event | |||
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | $ 1,700 | ||
Debt term | 5 years | ||
Term Loan B Facility | Term Loan | Subsequent event | |||
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | $ 1,700 | ||
Debt term | 7 years | ||
Minimum | Subsequent event | |||
Subsequent Event [Line Items] | |||
Expected cost | $ 70 | ||
Cash payments | 40 | ||
Non-cash asset write downs and other | 30 | ||
Maximum | Subsequent event | |||
Subsequent Event [Line Items] | |||
Expected cost | 85 | ||
Cash payments | 50 | ||
Non-cash asset write downs and other | $ 35 | ||
Forecast | Minimum | |||
Subsequent Event [Line Items] | |||
Expected cost | $ 20 | ||
Forecast | Maximum | |||
Subsequent Event [Line Items] | |||
Expected cost | $ 30 |