Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | Apr. 22, 2016 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | MRC GLOBAL INC. | |
Entity Central Index Key | 1,439,095 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Common Stock [Member] | ||
Entity Common Stock, Shares Outstanding | 98,650,627 | |
Restricted Stock [Member] | ||
Entity Common Stock, Shares Outstanding | 585,492 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash | $ 121 | $ 69 |
Accounts receivable, net | 470 | 533 |
Inventories, net | 720 | 781 |
Other current assets | 35 | 22 |
Total current assets | 1,346 | 1,405 |
Other assets | 22 | 22 |
Property, plant and equipment, net | 134 | 127 |
Intangible assets: | ||
Goodwill, net | 484 | 484 |
Other intangible assets, net | 448 | 459 |
Total assets | 2,434 | 2,497 |
Current liabilities: | ||
Trade accounts payable | 309 | 327 |
Accrued expenses and other current liabilities | 100 | 110 |
Current portion of long term debt | 8 | 8 |
Total current liabilities | 417 | 445 |
Long-term obligations: | ||
Long-term debt, net | 510 | 511 |
Deferred income taxes | 208 | 208 |
Other liabilities | $ 22 | $ 22 |
Commitments and contingencies | ||
6.5% Series A Convertible Perpetual Preferred Stock, $0.01 par value; authorized 363,000 shares; 363,000 shares issued and outstanding | $ 355 | $ 355 |
Stockholders' equity: | ||
Common stock, $0.01 par value per share: 500 million shares authorized, 102,345,890 and 102,202,599 issued, respectively | 1 | 1 |
Additional paid-in capital | 1,668 | 1,666 |
Retained deficit | (481) | (467) |
Less: Treasury stock at cost: 3,695,263 and 816,389 shares, respectively | (50) | (12) |
Accumulated other comprehensive loss | (216) | (232) |
Total stockholders' equity | 922 | 956 |
Total liabilities and stockholders' equity | $ 2,434 | $ 2,497 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
Condensed Consolidated Balance Sheets [Abstract] | ||
Preferred stock, dividend rate | 6.50% | 6.50% |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 363,000 | 363,000 |
Preferred stock, shares issued | 363,000 | 363,000 |
Preferred stock, shares outstanding | 363,000 | 363,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 102,345,890 | 102,202,599 |
Treasury stock, shares | 3,695,263 | 816,389 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Condensed Consolidated Statements of Operations [Abstract] | ||
Sales | $ 783 | $ 1,292 |
Cost of sales | 650 | 1,072 |
Gross profit | 133 | 220 |
Selling, general and administrative expenses | 137 | 159 |
Operating (loss) income | (4) | 61 |
Other expense: | ||
Interest expense | (8) | (15) |
Other, net | (1) | (4) |
(Loss) income before income taxes | (13) | 42 |
Income tax (benefit) expense | (5) | 13 |
Net (loss) income | (8) | 29 |
Series A preferred stock dividends | 6 | |
Net (loss) income attributable to common stockholders | $ (14) | $ 29 |
Basic (loss) earnings per common share | $ (0.14) | $ 0.28 |
Diluted (loss) earnings per common share | $ (0.14) | $ 0.28 |
Weighted-average common shares, basic | 100.7 | 102.1 |
Weighted-average common shares, diluted | 100.7 | 102.2 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Condensed Consolidated Statements of Comprehensive Income [Abstract] | ||
Net (loss) income | $ (8) | $ 29 |
Other comprehensive income (loss) | ||
Foreign currency translation adjustments | 16 | (53) |
Comprehensive income (loss) | $ 8 | $ (24) |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Operating activities | ||
Net (loss) income | $ (8) | $ 29 |
Adjustments to reconcile net (loss) income to net cash provided by operations: | ||
Depreciation and amortization | 5 | 5 |
Amortization of intangibles | 12 | 16 |
Equity-based compensation expense | 3 | 2 |
Deferred income tax benefit | (8) | |
Decrease in LIFO reserve | (3) | |
Provision for uncollectible accounts | 1 | 1 |
Foreign currency losses | 1 | 4 |
Other non-cash items | 2 | 3 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 67 | 103 |
Inventories | 24 | (9) |
Other current assets | (6) | (4) |
Income taxes payable | (5) | 11 |
Accounts payable | (22) | (6) |
Accrued expenses and other current liabilities | (13) | (32) |
Net cash provided by operations | 58 | 115 |
Investing activities | ||
Purchases of property, plant and equipment | (10) | (4) |
Proceeds from the disposition of non-core product line | 48 | |
Other investing activities | (3) | |
Net cash provided by (used in) investing activities | 38 | (7) |
Financing activities | ||
Payments on revolving credit facilities | (23) | (321) |
Proceeds from revolving credit facilities | 23 | 243 |
Payments on long term obligations | (2) | (2) |
Purchases of common stock | (38) | |
Dividends paid on preferred stock | (6) | |
Net cash used in financing activities | (46) | (80) |
Increase in cash | 50 | 28 |
Effect of foreign exchange rate on cash | 2 | (4) |
Cash -- beginning of period | 69 | 25 |
Cash -- end of period | 121 | 49 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 8 | 14 |
Cash paid for income taxes | $ 1 | $ 10 |
Background and Basis of Present
Background and Basis of Presentation | 3 Months Ended |
Mar. 31, 2016 | |
Background and Basis of Presentation [Abstract] | |
Background and Basis of Presentation | NOTE 1 – BACKGROUND AND BASIS OF PRESENTATION Business Operations : MRC Global Inc. is a holding company headquartered in Houston, Texas. Our wholly owned subsidiaries are global distributors of pipe, valves, fittings (“PVF”) and related products and services across each of the upstream (exploration, production and extraction of underground oil and gas), midstream (gathering and transmission of oil and gas, gas utilities, and the storage and distribution of oil and gas) and downstream (crude oil refining and petrochemical processing) sectors. We have branches in principal industrial, hydrocarbon producing and refining areas throughout the United States, Canada, Europe, Asia , Australasia , the Middle East and Caspian . Our products are obtained from a broad range of suppliers. Basis of Presentation : We have prepared our unaudited condensed consolidated financial statements in accordance with Rule 10-01 of Regulation S-X for interim financial statements. These statements do not include all information and footnotes that generally accepted accounting principles require for complete annual financial statements. However, the information in these statements reflects all normal recurring adjustments which are, in our opinion, necessary for a fair presentation of the results for the interim periods. The results of operations for the three months ended March 31, 2016 are not necessarily indicative of the results that will be realized for the fiscal year ending December 31, 2016 . We have derived our condensed consolidated balance sheet as of December 31, 2015 from the audited consolidated financial statements for the year ended December 31, 2015 . You should read these condensed consolidated financial statements in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2015 . The consolidated financial statements include the accounts of MRC Global Inc. and its wholly owned and majority owned subsidiaries (collectively referred to as the “Company” or by such terms as “we,” “our” or “us”). All material intercompany balances and transactions have been eliminated in consolidation. Reclassifications : Certain prior-period amounts have been reclassified to conform to the current year presentation, which includes the adoption of Accounting Standards Update (“ASU”) 2015-03 Interest-Imputation of Interest (Subtopic 855-30): Simplifying the Presentation of Debt Issuance Costs . Recent Accounting Pronouncements : In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 provides comprehensive guidance on the recognition of revenue from customers arising from the transfer of goods and services. The ASU also provides guidance on accounting for certain contract costs and requires new disclosures. The FASB voted to defer the effective date of ASU 2014-09 by one year to annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. We are currently evaluating the effect of the adoption of ASU 2014-09 on our consolidated financial statements and the implementation approach to be used. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory . ASU 2015-11 provides guidance on simplifying the measurement of inventory. The current standard is to measure inventory at lower of cost or market; where market could be replacement cost, net realizable value or net realizable value less an approximately normal profit margin. ASU 2015-11 updates this guidance to measure inventory at the lower of cost or net realizable value; where net realizable value is considered to be the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal and transportation. We expect to adopt this guidance in 2016. This amendment is not expected to have a material impact on the Company's financial position, results of operation or cash flows. In February 2016, the FASB issued ASU 2016-02, Leases, which will replace the existing guidance in ASC 870, Leases. This ASU requires a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use asset and a corresponding lease liability. For finance leases, the lessee would recognize interest expense and amortization of the right-of-use asset, and for operating leases, the lessee would recognize a straight-line total lease expense. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2018. We are beginning to evaluate the effect of the adoption of ASU 2016-02 on our consolidated financial results. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2016 | |
Inventories [Abstract] | |
Inventories | NOTE 2 – INVENTORIES The com position of our inventory is as follows (in millions ) : March 31, December 31, 2016 2015 Finished goods inventory at average cost: Energy carbon steel tubular products $ 176 $ 253 Valves, fittings, flanges and all other products 653 647 829 900 Less: Excess of average cost over LIFO cost (LIFO reserve) (78) (89) Less: Other inventory reserves (31) (30) $ 720 $ 781 O ur inventory quantities are expected to be reduced for the year , resulting in a liquidation of a last-in, first out (“ LIFO ”) inventory layer that was carried at a lower cost prevailing from a prior year, as compared with current costs in the current year (a “LIFO decrement”). A LIFO decrement results in the erosion of layers created in earlier years, and, therefore, a LIFO layer is not created for years that have decrements. For the three months ended March 31, 2016 and 2015 , the effect of this LIFO decrement decreased cost of sales by approximately $ 1 millio n and $0 million, respectively. |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2016 | |
Long-Term Debt [Abstract] | |
Long-Term Debt | NOTE 3 – LONG-TERM DEBT The components of our long-term debt are as follows (in millions ): March 31, December 31, 2016 2015 Senior Secured Term Loan B, net of discount and issuance costs of $6 and $7 , respectively $ 518 $ 519 Global ABL Facility - - 518 519 Less: Current portion 8 8 $ 510 $ 511 Senior Secured Term Loan B : We have a seven year Senior Secured Term Loan B (the “Term Loan”) with an original principal amount of $79 4 million which amortizes in equal quarterly installments of 1% per year with the balance payable in November 2019 when the facility matures. Subject to securing additional lender commitments, t he Term Loan allows for incremental increases in facility size up to an aggregate of $200 million, plus an additional amount such that the Company’s senior secured leverage ratio (as defined under the Term Loan) would not exceed 3.50 to 1.00 . MRC Global (US) Inc. is the borrower under this facility, which is guaranteed by MRC Global Inc. as well as all of its wholly owned U.S. subsidiaries. In addition, it is secured by a second lien on the assets securing our Global ABL Facility (which includes accounts receivable, inventory and related assets) and a first lien on substantially all of the other assets of MRC Global Inc. and those of its U.S. subsidiaries, as well as a pledge of all of the capital stock of our domestic subsidiaries and 65 % of the capital stock of first tier, non-U.S. subsidiaries. In certain circumstances, w e are required to repay the Term Loan with certain asset sales and insurance proceeds, certain debt proceeds and 50% of excess cash flow (reducing to 25% if our senior secured leverage ratio is no more than 2.75 to 1.00 and 0% if our senior secured leverage ratio is no more than 2.50 to 1.00). In addition, the Term Loan contains a number of customary restrictive covenants. The interest rate for the Term Loan , including the amortization of original issue discount and debt issuance costs , was 5.16% as of March 31, 2016 and 4.98% at December 31, 2015 . Global ABL Facility : We have a $1. 0 5 billion multi-currency global asset-based revolving credit facility (the “Global ABL Facility”) that matures in July 201 9 . This facility is comprised of $977 million in revolver commitments in the United States, $30 million in Norway, $20 million in Canada, $5 million in the United Kingdom, $10 million in Australia, $4 million in th e Netherlands and $4 million in Belgium. It contains an accordion feature that allows us to increase the principal amount of the facility by up to $300 million , subject to securing additional lender commitments . MRC Global Inc. and each of its current and future wholly owned material U.S. subsidiaries guarantee the obligations of our borrower subsidiaries under the Global ABL Facility. Additionally, each of our non-U.S. borrower subsidiaries guarantees the obligations of our other non-U.S. borrower subsidiaries under the Global ABL Facility. Outstanding obligations are generally secured by a first priority security interest in accounts receivable, inventory and related assets. Excess A vailability , as defined under our Global ABL Facility , was $587 million as of March 31, 2016 . Debt Issuanc e Costs : In the first quarter of 2016, we adopted ASU No. 2015-03 Interest-Imputation of Interest (Subtopic 855-30): Simplifying the Presentation of Debt Issuance Costs . This ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability consistent with debt discounts. As a result of the adoption, we have reclassified debt issuance costs associated with our Term Loan of $4 million and $5 million as of March 31, 2016 and December 31, 2015, respectively, from other assets to long term debt in our balance sheet. Accordingly, long term debt reported as $524 million at December 31, 2015 has been revised to $519 million. Debt issuance costs associated with our Global ABL Facility will continue to be presented in other assets. These amounts were $8 million as of March 31, 2016 and December 31, 2015, respectively. |
Disposition Of Non-Core Product
Disposition Of Non-Core Product Line | 3 Months Ended |
Mar. 31, 2016 | |
Disposition Of Non-Core Product Line [Abstract] | |
Disposition Of Non-Core Product Line | NOTE 4 – DISPOSITION OF NON-CORE PRODUCT LINE In February 2016, we completed the disposition of our U.S. oil country tubular goods (“OCTG”) product line for $48 million . As a result of this transaction, we incurred a loss of $5 million that was reflected in our fourth quarter 2015 results . Net of reserves, including LIFO and an adjustment to write the inventory down to its net realizable value, the carrying value of the U.S. OCTG inventories as of December 31, 2015 was $50 million. |
Redeemable Preferred Stock
Redeemable Preferred Stock | 3 Months Ended |
Mar. 31, 2016 | |
Redeemable Preferred Stock [Abstract] | |
Redeemable Preferred Stock | NOTE 5 – REDEEMABLE PREFERRED STOCK Preferred Stock Issuance In June 2015, we issued 363,000 shares of Series A Convertible Perpetual Preferred Stock (the “Preferred Stock”) and received gross proceeds of $363 million. The Preferred Stock ranks senior to our common stock with respect to dividend rights and rights on liquidation, winding-up and dissolution. The Preferred Stock has a stated value of $1,000 per share, and holders of Preferred Stock are entitled to cumulative dividends payable quarterly in cash at a rate of 6.50% per annum. Holders of Preferred Stock are entitled to vote together with the holders of the common stock as a single class, in each case, on an as-converted basis, except where a separate class vote of the common stockholders is required by law. Holders of Preferred Stock have certain limited special approval rights, including with respect to the issuance of pari passu or senior equity securities of the Company. The Preferred Stock is convertible at the option of the holders into shares of common stock at an initial conversion rate of 55.9284 shares of common stock for each share of Preferred Stock, which represents an initial conversion price of approximately $17.88 per share of common stock, subject to adjustment. On or after the fifth anniversary of the initial issuance of the Preferred Stock, the Company will have the option to redeem, in whole but not in part, all the outstanding shares of Preferred Stock, subject to certain redemption price adjustments on the basis of the date of the conversion. We may elect to convert the Preferred Stock, in whole but not in part, into the relevant number of shares of common stock on or after the 54th month after the initial issuance of the Preferred Stock if the last reported sale price of the common stock has been at least 150% of the conversion price then in effect for a specified period. The conversion rate is subject to customary anti-dilution and other adjustments. Holders of the Preferred Stock may, at their option, require the Company to repurchase their shares in the event of a fundamental change, as defined in the agreement. The repurchase price is based on the original $1,000 per share purchase price except in the case of a liquidation in which case they would receive the greater of $1,000 per share and the amount that would be received if they held common stock converted at the conversion rate in effect at the time of the fundamental change. Because this feature could require redemption as a result of the occurrence of an event not solely within the control of the Company, the Preferred Stock is classified as temporary equity on our balance sheet. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2016 | |
Stockholders' Equity [Abstract] | |
Stockholders' Equity | NOTE 6 – STOCKHOLDERS’ EQUITY Share Repurchase Program In November 2015 , the Company’s board of directors authorized a share repurchase program for common stock up to $100 million. The program is scheduled to expire December 31, 2017 . The shares may be repurchased at management’s discretion in the open market. Depending on market conditions and other factors, these repurchases may be commenced or suspended from time to time without prior notice. Summary of share repurchase activity under the repurchase program: Three Months Ended March 31, March 31, 2016 2015 Number of shares acquired on the open market 2,878,874 - Average price per share $ 13.39 $ - Total cost of acquired shares (in millions) $ 38 $ - In total, we have acquired 3,695,263 shares under this program at a total cost of $50 million. There were 98,650,627 shares of common stock outstanding as of March 31, 2016. Equity Compensation Plans Our 2011 Omnibus Incentive Plan originally had 3 ,250,000 shares reserved for issuance under the plan. In April 2015, our shareholders approved an additional 4,250,000 shares for reservation for issuance under the plan. The plan permits the issuance of stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units and other stock-based and cash-based awards. Since the adoption of the 2011 Omnibus Incentive Plan, the Company’s Board of Directors has periodically granted stock options , restricted stock awards, restric ted stock units and performance share units to directors and employees. Options and stock appreciation rights may not be granted at prices less than the fair market value of our common stock on the date of the grant, nor for a term exceeding ten years. For employees, vesting generally occurs ratably over a three to five year period on the anniversaries of the date specified in the employees’ respective stock option, restricted stock award, restricted stock unit and performance share unit award agreement s , subject to accelerated vesting under certain circumstances set forth in the agreements. Vesting for directors generally occurs on the on e -y ear anniversary of the grant date . In February 201 6 , 16,789 shares of restricted stock, 334,900 performance share unit awards and 1,149,039 restricted stock units were granted to employees . To date , before consideration of forfeitures , 4,987,800 shares have been granted to management, members of our Board of Directors and key employees under this plan. A Monte Carlo simulation is completed to estimate the fair value of performance share unit awards with a stock price performance component. A Black-Scholes option-pricing model is used to estimate the fair value of the stock options. We expense the fair value of equity grants on a straight-line basis over the vesting period. Accumulated Other Comprehensive Loss Accumulated other comprehensive loss in the accompanying consolidated balance sheets consists of the following (in millions ): March 31, December 31, 2016 2015 Currency translation adjustments $ (215) $ (231) Pension related adjustments (1) (1) Accumulated other comprehensive loss $ (216) $ (232) Earnings per Share Earnings per share are calculated in the table below (in millions , except per share amounts). Three Months Ended March 31, March 31, 2016 2015 Net (loss) income $ (8) $ 29 Less: Dividends on Series A Preferred Stock 6 - Net (loss) income attributable to common stockholders $ (14) $ 29 Weighted average basic shares outstanding 100.7 102.1 Effect of dilutive securities - 0.1 Weighted average diluted shares outstanding 100.7 102.2 Net (loss) income per share: Basic $ (0.14) $ 0.28 Diluted $ (0.14) $ 0.28 Equity awards and shares of Preferred Stock are disregarded in the calculation of diluted earnings per share if they are determined to be anti-dilutive. For the three months ended March 31, 2016 , all of the shares of the newly issued Preferred Stock were anti-dilutive. For the three months ended March 31, 2016 and 2015 , we had approximately 3.8 million and 3.9 million anti-dilutive stock options, respectively. T here w ere 0.6 mi llion and no anti-dilutive restricted stock , restricted units or performance stock unit awards for the three months ended March 31, 2016 and 2015 , r espectiv ely . |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2016 | |
Segment Information [Abstract] | |
Segment Information | NOTE 7 – SEGMENT INFORMATION We operate as three business segments, U.S., Canada and International. Our International segment consists of our operations outside of the U.S. and Canada. These segments represent our business of selling pipe, valves and fittings (“PVF”) to the energy sector across each of the upstream (exploration, production and extraction of underground oil and gas), midstream (gathering and transmission of oil and gas, gas utilities, and the storage and distribution of oil and gas) and downstream (crude oil refining and petrochemical processing) markets. Effective April 1, 2016, we made organizational changes that will result in the Eastern and Western regions of the U.S. being considered separate operating segments. These two U.S. operating segments will be aggregated into a single reportable segment based on their economic similarities. As a result, we will continue to report segment information for the U.S., Canada and International. The following table presents financial information for each segment (in millions): Three Months Ended March 31, March 31, 2016 2015 Sales U.S. $ 606 $ 972 Canada 64 119 International 113 201 Sales $ 783 $ 1,292 Operating (loss) income U.S. $ 4 $ 52 Canada (1) 6 International (7) 3 Operating (loss) income (4) 61 Interest expense (8) (15) Other, net (1) (4) Income (loss) before income taxes $ (13) $ 42 March 31, December 31, 2016 2015 Total assets U.S. $ 2,055 $ 2,135 Canada 148 142 International 231 220 Total assets $ 2,434 $ 2,497 Our sales by product line are as follows (in millions ): Three Months Ended March 31, March 31, Type 2016 2015 Energy carbon steel tubular products: Line pipe (1) $ 132 $ 266 Oil country tubular goods (OCTG) - 106 $ 132 $ 372 Valves, fittings, flanges and other products: Valves and specialty products $ 299 $ 411 Carbon steel fittings and flanges and stainless steel and alloy pipe and fittings 168 269 Other 184 240 $ 651 $ 920 (1) As a result of the disposition of our OCTG product line, as described in Note 4, pre- disposition OCTG sales of $18 million have been included within line pipe sales for the three months ended March 31, 2016 . |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Measurements [Abstract] | |
Fair Value Measurements | NOTE 8 – FAIR VALUE MEASUREMENTS From time to time, we use derivative financial instruments to help manage our exposure to interest rate risk and fluctuations in foreign currencies. All of our derivative instruments are freestanding and, accordingly, changes in their fair market value are recorded in earnings. As of March 31, 2016 , we do not have any interest rate swap agreements. Foreign exchange forward contracts and options are reported at fair value utilizing Level 2 inputs, as the fair value is based on broker quotes for the same or similar derivative instruments. The total notional amount of our forward foreign exchange contracts and options was approximately $4 8 million and $41 million at March 31, 2016 and December 31, 2015 , respectively. We had approximate l y $1 million and $0 million recorded as liabilities on our consolidated balance sheets as of March 31, 2016 and December 31, 2015 , respectively. With the exception of long-term debt, the fair values of our financial instruments, including cash and cash equivalents, accounts receivable , trade accounts payable and accrued liabilities approximate carrying value. The carrying value of our debt was $51 8 m illion and $519 m illion at March 31, 2016 and December 31, 2015 , respectively. We estimate the fair value of the Term Loan using Level 2 inputs, or quoted market prices. The fair value of our debt was $507 m illion and $510 m illion at March 31, 2016 and December 31, 2015 , respectively. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | NOTE 9 – COMMITMENTS AND CONTINGENCIES Litigation As bestos Claims. We are one of many defendants in lawsuits that plaintiffs have brought seeking damages for personal injuries that exposure to asbestos allegedly caused. Plaintiffs and their family members have brought these lawsuits against a large volume of defendant entities as a result of the defendants’ manufacture, distribution, supply or other involvement with asbestos, asbestos containing-products or equipment or activities that allegedly caused plaintiffs to be exposed to asbestos. These plaintiffs typically assert exposure to asbestos as a consequence of third-party manufactured products that our MRC Global (US) Inc. subsidiary purportedly distributed. As of March 31, 2016 , we are named a defendant in approximately 482 l awsuits involving approximately 1,106 claims. No asbestos lawsuit has resulted in a judgment against us to date, with a majority being settled, dismissed or otherwise resolved. Applicable third-party insurance has substantially covered these claims, and insurance should continue to cover a substantial majority of existing and anticipated future claims. Accordingly, we have recorded a liability for our estimate of the most likely settlement of asserted claims and a related receivable from insurers for our estimated recovery, to the extent we believe that the amounts of recovery are probable. It is not possible to predict the outcome of these claims and proceedings. However, in our opinion, th e likelihood that the ultimate disposition of any of these claims and legal proceeding s will have a material adverse effect on our consolidated financial statements is remote . Other Legal Claims and Proceedings. From time to time, we have been subject to various claims and involved in legal proceedings incidental to the nature of our businesses. We maintain insurance coverage to reduce financial risk associated with certain of these claims and proceedings. It is not possible to predict the outcome of these claims and proceedings. However, in our opinion, th e likelihood that the ultimate disposition of any of these claims and legal proceeding s will have a material adverse effect on our consolidated financial statements is remote. Product Claims. From time to time, in the ordinary course of our business, our customers may claim that the products that we distribute are either defective or require repair or replacement under warranties that either we or the manufacturer may provide to the customer. These proceedings are, in the opinion of management, ordinary and routine matters incidental to our normal business. Our purchase orders with our suppliers generally require the manufacturer to indemnify us against any product liability claims, leaving the manufacturer ultimately responsible for these claims. In many cases, state, provincial or foreign law provides protection to distributors for these sorts of claims, shifting the responsibility to the manufacturer. In some cases, we could be required to repair or replace the products for the benefit of our customer and seek our recovery from the manufacturer for our expense. In our opinion, th e likelihood that the ultimate disposition of any of these claims and legal proceeding s will have a material adverse effect on our consolidated financial statements is remote . Weatherford Claim. In addition to PVF, our Canadian subsidiary, Midfield Supply (“Midfield”), now known as MRC Global (Canada) ULC , also distributed progressive cavity pumps and related equipment (“PCPs”) under a distribution agreement with Weatherford Canada Partnership (“Weatherford”) within a certain geographical area located in southern Alberta, Canada. I n late 2005 and early 2006, Midfield hired new employees, including former Weatherford employees , as part of Midfield’s desire to expand its PVF business into northern Alberta. Shortly thereafter, many of these employees left Midfield and formed a PCP manufacturing, distribution and service company named Europump Systems Inc. (“Europump”) in 2006. A subsidiary of Halliburton Company purchased Europump in 2014. The distribution agreement with Weatherford expired in 2006. Midfield supplied Europump with PVF products that Europump distributed along with PCP pumps. In April 2007, Midfield purchased Europump’s distribution branches and began distributing and servicing Europump PCPs. Pursuant to a complaint that Weatherford filed on April 11, 2006 in the Court of Queen’s Bench of Alberta, Judicial Bench of Edmonton (Action No. 060304628), Weatherford sued Europump, three of Europump’s part suppliers, Midfield, certain current and former employees of Midfield, and other related entities, asserting a host of claims including breach of contract, breach of fiduciary duty, misappropriation of confidential information related to the PCPs, unlawful interference with economic relations and conspiracy. The Company denies these allegations and contends that Midfield’s expansion and subsequent growth was the result of fair competition. From 2006 through 2012, the case focused largely on Weatherford’s questioning of defense witnesses. In 2013, the defendants began substantive questioning of Weatherford and its witnesses. Discovery is ongoing and expected to last through 2016. In April 2016, the court dismissed two suppliers from the case. Weatherford has appealed this dismissal. The case is scheduled for trial on January 16, 2017. While the Company believes Weatherford’s claims are without merit and we intend to defend against them vigorously, in November 2015, the Company filed with the Court a formal offer of settlement for $2 million plus one half of the Weatherford party’s costs and interest under the Judgment Interest Act and reserved $ 3 million for the offer. Weatherford declined to accept the offer. Customer Contracts We have contracts and agreements with many of our customers that dictate certain terms of our sales arrangements (pricing, deliverables, etc.). While we make every effort to abide by the terms of these contracts, certain provisions are complex and often subject to varying interpretations. Under the terms of these contracts, our customers have the right to audit our adherence to the contract terms. Historically, any settlements that have resulted from these customer audits have not been material to our consolidated financial statements. Purchase Commitments We ha v e purchase obligations consisting primarily of inventory purchases made in the normal course of business to meet operating needs. While our vendors often allow us to cancel these purchase orders without penalty, in certain cases, cancellations may subject us to cancellation fees or penalties depending on the terms of the contract . |
Background and Basis of Prese16
Background and Basis of Presentation (Policy) | 3 Months Ended |
Mar. 31, 2016 | |
Background and Basis of Presentation [Abstract] | |
Business Operations | Business Operations : MRC Global Inc. is a holding company headquartered in Houston, Texas. Our wholly owned subsidiaries are global distributors of pipe, valves, fittings (“PVF”) and related products and services across each of the upstream (exploration, production and extraction of underground oil and gas), midstream (gathering and transmission of oil and gas, gas utilities, and the storage and distribution of oil and gas) and downstream (crude oil refining and petrochemical processing) sectors. We have branches in principal industrial, hydrocarbon producing and refining areas throughout the United States, Canada, Europe, Asia , Australasia , the Middle East and Caspian . Our products are obtained from a broad range of suppliers. |
Basis of Presentation | Basis of Presentation : We have prepared our unaudited condensed consolidated financial statements in accordance with Rule 10-01 of Regulation S-X for interim financial statements. These statements do not include all information and footnotes that generally accepted accounting principles require for complete annual financial statements. However, the information in these statements reflects all normal recurring adjustments which are, in our opinion, necessary for a fair presentation of the results for the interim periods. The results of operations for the three months ended March 31, 2016 are not necessarily indicative of the results that will be realized for the fiscal year ending December 31, 2016 . We have derived our condensed consolidated balance sheet as of December 31, 2015 from the audited consolidated financial statements for the year ended December 31, 2015 . You should read these condensed consolidated financial statements in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2015 . The consolidated financial statements include the accounts of MRC Global Inc. and its wholly owned and majority owned subsidiaries (collectively referred to as the “Company” or by such terms as “we,” “our” or “us”). All material intercompany balances and transactions have been eliminated in consolidation. |
Reclassifications | Reclassifications : Certain prior-period amounts have been reclassified to conform to the current year presentation, which includes the adoption of Accounting Standards Update (“ASU”) 2015-03 Interest-Imputation of Interest (Subtopic 855-30): Simplifying the Presentation of Debt Issuance Costs . |
Recent Accounting Pronouncements | Recent Accounting Pronouncements : In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 provides comprehensive guidance on the recognition of revenue from customers arising from the transfer of goods and services. The ASU also provides guidance on accounting for certain contract costs and requires new disclosures. The FASB voted to defer the effective date of ASU 2014-09 by one year to annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. We are currently evaluating the effect of the adoption of ASU 2014-09 on our consolidated financial statements and the implementation approach to be used. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory . ASU 2015-11 provides guidance on simplifying the measurement of inventory. The current standard is to measure inventory at lower of cost or market; where market could be replacement cost, net realizable value or net realizable value less an approximately normal profit margin. ASU 2015-11 updates this guidance to measure inventory at the lower of cost or net realizable value; where net realizable value is considered to be the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal and transportation. We expect to adopt this guidance in 2016. This amendment is not expected to have a material impact on the Company's financial position, results of operation or cash flows. In February 2016, the FASB issued ASU 2016-02, Leases, which will replace the existing guidance in ASC 870, Leases. This ASU requires a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use asset and a corresponding lease liability. For finance leases, the lessee would recognize interest expense and amortization of the right-of-use asset, and for operating leases, the lessee would recognize a straight-line total lease expense. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2018. We are beginning to evaluate the effect of the adoption of ASU 2016-02 on our consolidated financial results. In Ma rch 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation , which simplifies the accounting for the taxes rela ted to stock based compensation. Under the standard, excess tax benefits and certain tax deficiencies will no longer be recorded in additional paid-in capital (“APIC”) and APIC pools will be eliminated. Instead, all excess tax benefits and tax deficiencies will be recorded as income tax expense or benefit in the income statement. In addition, excess tax benefits are required to be presented as operating activities rather than financing activities in the statement of cash flows. This guidance is effective for annual and interim reporting periods of public entities b eginning after December 15, 2016 . This amendment is not expected to have a material impact on the Company's financial position, results of operation s or cash flows. |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Inventories [Abstract] | |
Composition of Inventory | March 31, December 31, 2016 2015 Finished goods inventory at average cost: Energy carbon steel tubular products $ 176 $ 253 Valves, fittings, flanges and all other products 653 647 829 900 Less: Excess of average cost over LIFO cost (LIFO reserve) (78) (89) Less: Other inventory reserves (31) (30) $ 720 $ 781 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Long-Term Debt [Abstract] | |
Components of Long-Term Debt | March 31, December 31, 2016 2015 Senior Secured Term Loan B, net of discount and issuance costs of $6 and $7 , respectively $ 518 $ 519 Global ABL Facility - - 518 519 Less: Current portion 8 8 $ 510 $ 511 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Stockholders' Equity [Abstract] | |
Summary of Share Repurchase Activity | Summary of share repurchase activity under the repurchase program: Three Months Ended March 31, March 31, 2016 2015 Number of shares acquired on the open market 2,878,874 - Average price per share $ 13.39 $ - Total cost of acquired shares (in millions) $ 38 $ - |
Accumulated Other Comprehensive Loss in Accompanying Consolidated Balance Sheets | March 31, December 31, 2016 2015 Currency translation adjustments $ (215) $ (231) Pension related adjustments (1) (1) Accumulated other comprehensive loss $ (216) $ (232) |
Earnings Per Share | Three Months Ended March 31, March 31, 2016 2015 Net (loss) income $ (8) $ 29 Less: Dividends on Series A Preferred Stock 6 - Net (loss) income attributable to common stockholders $ (14) $ 29 Weighted average basic shares outstanding 100.7 102.1 Effect of dilutive securities - 0.1 Weighted average diluted shares outstanding 100.7 102.2 Net (loss) income per share: Basic $ (0.14) $ 0.28 Diluted $ (0.14) $ 0.28 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Segment Information [Abstract] | |
Schedule of Financial Information for Each Segment | Three Months Ended March 31, March 31, 2016 2015 Sales U.S. $ 606 $ 972 Canada 64 119 International 113 201 Sales $ 783 $ 1,292 Operating (loss) income U.S. $ 4 $ 52 Canada (1) 6 International (7) 3 Operating (loss) income (4) 61 Interest expense (8) (15) Other, net (1) (4) Income (loss) before income taxes $ (13) $ 42 March 31, December 31, 2016 2015 Total assets U.S. $ 2,055 $ 2,135 Canada 148 142 International 231 220 Total assets $ 2,434 $ 2,497 |
Schedule of Net Sales by Product Line | Three Months Ended March 31, March 31, Type 2016 2015 Energy carbon steel tubular products: Line pipe (1) $ 132 $ 266 Oil country tubular goods (OCTG) - 106 $ 132 $ 372 Valves, fittings, flanges and other products: Valves and specialty products $ 299 $ 411 Carbon steel fittings and flanges and stainless steel and alloy pipe and fittings 168 269 Other 184 240 $ 651 $ 920 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Finished goods inventory at average cost: | |||
Finished goods inventory at average cost | $ 829 | $ 900 | |
Less: Excess of average cost over LIFO cost (LIFO reserve) | (78) | (89) | |
Less: Other inventory reserves | (31) | (30) | |
Inventories, net | 720 | 781 | |
Effect of LIFO decrement on cost of sales | 1 | $ 0 | |
Energy carbon steel tubular products [Member] | |||
Finished goods inventory at average cost: | |||
Finished goods inventory at average cost | 176 | 253 | |
Valves, fittings, flanges and all other products [Member] | |||
Finished goods inventory at average cost: | |||
Finished goods inventory at average cost | $ 653 | $ 647 |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Debt Instrument [Line Items] | |||
Proceeds from revolving credit facilities | $ 23 | $ 243 | |
Reclassified debt issuance costs | 4 | $ 5 | |
Long-term debt, net | $ 510 | 511 | |
Scenario, Previously Reported [Member] | |||
Debt Instrument [Line Items] | |||
Long-term debt, net | 524 | ||
Revolving credit facility [Member] | |||
Debt Instrument [Line Items] | |||
Debt instrument, maturity date | Jul. 31, 2019 | ||
Credit facility, maximum borrowing capacity | $ 1,050 | ||
Proceeds from revolving credit facilities | 300 | ||
Revolving credit facility [Member] | U.S. [Member] | |||
Debt Instrument [Line Items] | |||
Credit facility, maximum borrowing capacity | 977 | ||
Revolving credit facility [Member] | Canada [Member] | |||
Debt Instrument [Line Items] | |||
Credit facility, maximum borrowing capacity | 20 | ||
Revolving credit facility [Member] | United Kingdom [Member] | |||
Debt Instrument [Line Items] | |||
Credit facility, maximum borrowing capacity | 5 | ||
Revolving credit facility [Member] | Australia [Member] | |||
Debt Instrument [Line Items] | |||
Credit facility, maximum borrowing capacity | 10 | ||
Revolving credit facility [Member] | Netherlands [Member] | |||
Debt Instrument [Line Items] | |||
Credit facility, maximum borrowing capacity | 4 | ||
Revolving credit facility [Member] | Belgium [Member] | |||
Debt Instrument [Line Items] | |||
Credit facility, maximum borrowing capacity | 4 | ||
Revolving credit facility [Member] | Norway [Member] | |||
Debt Instrument [Line Items] | |||
Credit facility, maximum borrowing capacity | 30 | ||
Global ABL Facility [Member] | |||
Debt Instrument [Line Items] | |||
Credit facility, remaining borrowing capacity | 587 | ||
Debt issuance costs | 8 | $ 8 | |
Senior Secured Term Loan B [Member] | |||
Debt Instrument [Line Items] | |||
New Term Loan | $ 794 | ||
Debt maturity period | 7 years | ||
Term loan annual amortization percentage | 1.00% | ||
Debt instrument, maturity date | Nov. 30, 2019 | ||
Term Loan accordion feature | $ 200 | ||
Percentage of capital stock in foreign subsidiaries securing Term Loan B | 65.00% | ||
Debt instrument, interest rate | 5.16% | 4.98% | |
Senior Secured Term Loan B [Member] | Senior Secured Leverage Ratio Is No More Than 2.75 to 1.00 [Member] | |||
Debt Instrument [Line Items] | |||
Senior secured leverage ratio | 2.75 | ||
Repayment of Term Loan, percentage | 25.00% | ||
Senior Secured Term Loan B [Member] | Senior Secured Leverage Ratio Is No More Than 2.50 to 1.00 [Member] | |||
Debt Instrument [Line Items] | |||
Senior secured leverage ratio | 2.50 | ||
Repayment of Term Loan, percentage | 0.00% | ||
Senior Secured Term Loan B [Member] | Maximum [Member] | |||
Debt Instrument [Line Items] | |||
Senior secured leverage ratio | 3.50 | ||
Repayment of Term Loan, percentage | 50.00% |
Long-Term Debt (Components of L
Long-Term Debt (Components of Long-Term Debt) (Details) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 518 | $ 519 |
Less: Current portion | 8 | 8 |
Long-term debt, net | 510 | 511 |
Senior secured term loan [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | 518 | 519 |
Original issue discount on senior secured Term Loan B | $ 6 | $ 7 |
Disposition Of Non-Core Produ24
Disposition Of Non-Core Product Line (Details) - Disposal Group, Not Discontinued Operations [Member] - U.S. Oil Country Tubular Goods [Member] - USD ($) $ in Millions | 3 Months Ended | |
Dec. 31, 2015 | Feb. 29, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Disposition of product line | $ 48 | |
Inventory | $ 50 | |
Loss on disposition | $ 5 |
Redeemable Preferred Stock (Det
Redeemable Preferred Stock (Details) $ / shares in Units, $ in Millions | 1 Months Ended |
Jun. 30, 2015USD ($)$ / sharesshares | |
Stockholders' Equity [Abstract] | |
Preferred stock, issued | shares | 363,000 |
Gross proceeds from issuance of Series A Preferred Stock | $ | $ 363 |
Preferred stock, stated value | $ / shares | $ 1,000 |
Preferred stock, dividend rate | 6.50% |
Preferred stock, initial conversion rate | shares | 55.9284 |
Preferred stock, initial conversion price | $ / shares | $ 17.88 |
Preferred stock, common stock as percentage of conversion price | 150.00% |
Stockholders' Equity (Narrative
Stockholders' Equity (Narrative) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 63 Months Ended | |||
Feb. 29, 2016 | Apr. 30, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2016 | Nov. 30, 2015 | |
Stockholders Equity [Line Items] | |||||||
Share repurchase program, total shares acquired | 3,695,263 | ||||||
Share repurchase program, cost of total shares acquired | $ 50,000,000 | ||||||
Common stock, shares outstanding | 98,650,627 | 98,650,627 | 98,650,627 | ||||
2015 Share Repurchase Program [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Share repurchase program, authorized amount | $ 100,000,000 | ||||||
Share repurchase program, expiration date | Dec. 31, 2017 | ||||||
2011 Omnibus Incentive Plan [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Shares reserved for Incentive Plan | 3,250,000 | 3,250,000 | 3,250,000 | ||||
Additional shares reserved for Incentive Plan | 4,250,000 | ||||||
Stock granted | 4,987,800 | ||||||
Director [Member] | 2011 Omnibus Incentive Plan [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Vesting period | 1 year | ||||||
Minimum [Member] | 2011 Omnibus Incentive Plan [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Vesting period | 3 years | ||||||
Maximum [Member] | 2011 Omnibus Incentive Plan [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Vesting period | 5 years | ||||||
Stock Options [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Anti-dilutive securities | 3,800,000 | 3,900,000 | |||||
Stock Options [Member] | 2011 Omnibus Incentive Plan [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Maximum term for stock option plan grant | 10 years | ||||||
Restricted Stock [Member] | 2011 Omnibus Incentive Plan [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Stock granted | 16,789 | ||||||
Performance Shares [Member] | 2011 Omnibus Incentive Plan [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Stock granted | 334,900 | ||||||
Restricted Stock Units (RSUs) [Member] | 2011 Omnibus Incentive Plan [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Stock granted | 1,149,039 | ||||||
Restricted Stock, Restricted Unites And Performance Stock Units [Member] | |||||||
Stockholders Equity [Line Items] | |||||||
Anti-dilutive securities | 600,000 | 0 |
Stockholders' Equity (Summary o
Stockholders' Equity (Summary of Share Repurchase Activity) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Equity, Class of Treasury Stock [Line Items] | ||
Total cost of acquired shares | $ 38 | |
2015 Share Repurchase Program [Member] | ||
Equity, Class of Treasury Stock [Line Items] | ||
Number of shares acquired on the open market | 2,878,874 | |
Average price per share | $ 13.39 | |
Total cost of acquired shares | $ 38 |
Stockholders' Equity (Accumulat
Stockholders' Equity (Accumulated Other Comprehensive Loss in Accompanying Consolidated Balance Sheets) (Details) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Stockholders' Equity [Abstract] | ||
Currency translation adjustments | $ (215) | $ (231) |
Pension related adjustments | (1) | (1) |
Accumulated other comprehensive loss | $ (216) | $ (232) |
Stockholders' Equity (Earnings
Stockholders' Equity (Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Stockholders' Equity [Abstract] | ||
Net (loss) income | $ (8) | $ 29 |
Less: Dividends on Series A Preferred Stock | 6 | |
Net (loss) income attributable to common stockholders | $ (14) | $ 29 |
Weighted average basic shares outstanding | 100.7 | 102.1 |
Effect of dilutive securities | 0.1 | |
Weighted average diluted shares outstanding | 100.7 | 102.2 |
Net (loss) income per share: | ||
Basic | $ (0.14) | $ 0.28 |
Diluted | $ (0.14) | $ 0.28 |
Segment Information (Narrative)
Segment Information (Narrative) (Details) - segment | Apr. 01, 2016 | Mar. 31, 2016 |
U.S., Canada And International [Member] | ||
Segment Information [Line Items] | ||
Number of operating segments | 3 | |
Subsequent Event [Member] | U.S. [Member] | ||
Segment Information [Line Items] | ||
Number of operating segments | 2 | |
Number of Reportable Segments | 1 |
Segment Information (Schedule o
Segment Information (Schedule of Financial Information for Each Segment) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Sales | |||
Sales | $ 783 | $ 1,292 | |
Operating income | |||
Operating (loss) income | (4) | 61 | |
Interest expense | (8) | (15) | |
Other, net | (1) | (4) | |
(Loss) income before income taxes | (13) | 42 | |
Total assets | |||
Total assets | 2,434 | $ 2,497 | |
U.S. [Member] | |||
Sales | |||
Sales | 606 | 972 | |
Operating income | |||
Operating (loss) income | 4 | 52 | |
Total assets | |||
Total assets | 2,055 | 2,135 | |
Canada [Member] | |||
Sales | |||
Sales | 64 | 119 | |
Operating income | |||
Operating (loss) income | (1) | 6 | |
Total assets | |||
Total assets | 148 | 142 | |
International [Member] | |||
Sales | |||
Sales | 113 | 201 | |
Operating income | |||
Operating (loss) income | (7) | $ 3 | |
Total assets | |||
Total assets | $ 231 | $ 220 |
Segment Information (Schedule32
Segment Information (Schedule of Net Sales by Product Line) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Energy carbon steel tubular products [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net Sales | $ 132 | $ 372 | |
Energy carbon steel tubular products [Member] | Line pipe [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net Sales | [1] | $ 132 | 266 |
Energy carbon steel tubular products [Member] | Oil country tubular goods (OCTG) [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net Sales | 106 | ||
Valves, fittings, flanges and all other products [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net Sales | $ 651 | 920 | |
Valves, fittings, flanges and all other products [Member] | Valves and Specialty Products [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net Sales | 299 | 411 | |
Valves, fittings, flanges and all other products [Member] | Carbon steel fittings and flanges and stainless steel and alloy pipe and fittings [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net Sales | 168 | 269 | |
Valves, fittings, flanges and all other products [Member] | Other [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net Sales | 184 | $ 240 | |
U.S. Oil Country Tubular Goods [Member] | Disposal Group, Not Discontinued Operations [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Pre-disposition sales | $ 18 | ||
[1] | As a result of the disposition of our OCTG product line, as described in Note 4, pre-disposition OCTG sales of $18 million have been included within line pipe sales for the three months ended March 31, 2016 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Long-term Debt [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Carrying value of debt | $ 518 | $ 519 |
Long-term Debt [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of our debt | 507 | 510 |
Foreign exchange forward contracts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Notional amount of forward foreign exchange contracts and options | 48 | 41 |
Foreign exchange forward contracts [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of forward foreign exchange contracts and options | $ 1 | $ 0 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 1 Months Ended | ||
Apr. 30, 2016item | Nov. 30, 2015USD ($) | Mar. 31, 2016USD ($)claimlawsuit | |
Loss Contingencies [Line Items] | |||
Number of lawsuits | lawsuit | 482 | ||
Asbestos related pending claims | claim | 1,106 | ||
Settlement offer | $ 2 | ||
Litigation reserve | $ 3 | ||
Subsequent Event [Member] | |||
Loss Contingencies [Line Items] | |||
Suppliers dismissed from case | item | 2 |