Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Aug. 01, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 | |
Entity Registrant Name | Trinseo S.A. | |
Entity Central Index Key | 1,519,061 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 46,406,333 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Current assets | ||
Cash and cash equivalents | $ 465,213 | $ 431,261 |
Accounts receivable, net of allowance for doubtful accounts (June 30, 2016 -- $2,862; December 31, 2015 -- $2,417) | 534,860 | 494,556 |
Inventories | 365,139 | 353,097 |
Other current assets | 27,096 | 10,120 |
Total current assets | 1,392,308 | 1,289,034 |
Investments in unconsolidated affiliates | 190,314 | 182,836 |
Property, plant and equipment, net of accumulated depreciation (June 30, 2016 -- $410,753; December 31, 2015 -- $375,315) | 505,319 | 518,751 |
Other assets | ||
Goodwill | 31,169 | 31,064 |
Other intangible assets, net | 171,644 | 158,218 |
Deferred income tax assets-noncurrent | 42,705 | 51,395 |
Deferred charges and other assets | 29,168 | 27,596 |
Total other assets | 274,686 | 268,273 |
Total assets | 2,362,627 | 2,258,894 |
Current liabilities | ||
Short-term borrowings and current portion of long-term debt | 5,000 | 5,000 |
Accounts payable | 330,413 | 324,629 |
Income taxes payable | 20,229 | 20,804 |
Accrued expenses and other current liabilities | 107,828 | 98,836 |
Total current liabilities | 463,470 | 449,269 |
Noncurrent liabilities | ||
Long-term debt | 1,183,287 | 1,177,120 |
Deferred income tax liabilities - noncurrent | 27,979 | 25,764 |
Other noncurrent obligations | 224,478 | 217,727 |
Total noncurrent liabilities | 1,435,744 | 1,420,611 |
Shareholders' equity | ||
Ordinary shares, $0.01 nominal value, 50,000,000 shares authorized (June 30, 2016: 48,778 shares issued and 46,403 shares outstanding; December 31, 2015, 48,778 shares issued and outstanding) | 488 | 488 |
Additional paid-in-capital | 565,590 | 556,532 |
Treasury shares, at cost (June 30, 2016: 2,374 shares; December 31, 2015: zero shares) | (93,676) | |
Accumulated deficit | 139,427 | (18,289) |
Accumulated other comprehensive loss | (148,416) | (149,717) |
Total shareholders' equity | 463,413 | 389,014 |
Total liabilities and shareholders' equity | $ 2,362,627 | $ 2,258,894 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Condensed Consolidated Balance Sheets | ||
Allowance for doubtful accounts | $ 2,862 | $ 2,417 |
Accumulated depreciation | $ 410,753 | $ 375,315 |
Ordinary shares, nominal value | $ 0.01 | $ 0.01 |
Ordinary shares, shares authorized | 50,000,000,000 | 50,000,000,000 |
Ordinary shares, shares issued | 48,778,000 | 48,778,000 |
Ordinary shares, shares outstanding | 46,403,000 | 48,778,000 |
Treasury stock, shares | 2,374,000 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Condensed Consolidated Statements of Operations | ||||
Net sales | $ 969,694 | $ 1,028,673 | $ 1,863,778 | $ 2,046,938 |
Cost of sales | 799,954 | 886,536 | 1,554,366 | 1,801,722 |
Gross profit | 169,740 | 142,137 | 309,412 | 245,216 |
Selling, general and administrative expenses | 52,249 | 50,739 | 106,735 | 102,514 |
Equity in earnings of unconsolidated affiliates | 38,602 | 40,841 | 73,628 | 77,548 |
Operating income | 156,093 | 132,239 | 276,305 | 220,250 |
Interest expense, net | 18,814 | 25,600 | 37,710 | 54,456 |
Loss on extinguishment of long-term debt | 95,150 | 95,150 | ||
Other expense, net | 12,875 | 3,233 | 15,544 | 6,784 |
Income (loss) before income taxes | 124,404 | 8,256 | 223,051 | 63,860 |
Provision for income taxes | 28,600 | 7,500 | 50,500 | 25,400 |
Net income (loss) | $ 95,804 | $ 756 | $ 172,551 | $ 38,460 |
Weighted average shares- basic | 46,952 | 48,771 | 47,803 | 48,770 |
Net income (loss) per share- basic | $ 2.04 | $ 0.02 | $ 3.61 | $ 0.79 |
Weighted average shares- diluted | 47,857 | 48,907 | 48,554 | 48,896 |
Net income (loss) per share- diluted | $ 2 | $ 0.02 | $ 3.55 | $ 0.79 |
Repayment of equity per share | $ 0.30 | $ 0.30 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Condensed Consolidated Statements of Comprehensive Income (Loss) | ||||
Net income | $ 95,804 | $ 756 | $ 172,551 | $ 38,460 |
Other comprehensive income (loss), net of tax (tax amounts shown in millions below for the three and six months ended June 30, 2016 and 2015, respectively): | ||||
Cumulative translation adjustments | (11,005) | 35,241 | 2,418 | (78,914) |
Net gain (loss) on foreign exchange cash flow hedges | 6,029 | (1,440) | (1,396) | (405) |
Pension and other postretirement benefit plans: | ||||
Net gain (loss) arising during period (net of tax of: 2016 - $0 and ($0.5); 2015 - $0 and $0) | (800) | |||
Amounts reclassified from accumulated other comprehensive income (loss) | 539 | 791 | 1,079 | 1,628 |
Total other comprehensive income (loss), net of tax | (4,437) | 34,592 | 1,301 | (77,691) |
Comprehensive income (loss) | $ 91,367 | $ 35,348 | $ 173,852 | $ (39,231) |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Condensed Consolidated Statements of Comprehensive Income (Loss) | ||||
Net gain (loss) arising during period, tax (benefit) expense | $ 0 | $ 0 | $ (0.5) | $ 0 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands | Ordinary Shares | Additional Paid-In Capital [Member]Adjustments for New Accounting Principle, Early Adoption | Additional Paid-In Capital [Member] | Treasury Shares | Accumulated Other Comprehensive Income (Loss) [Member] | Retained Earnings (Accumulated Deficit).Adjustments for New Accounting Principle, Early Adoption | Retained Earnings (Accumulated Deficit). | Total |
Balance at Dec. 31, 2014 | $ 488 | $ 547,530 | $ (75,217) | $ (151,936) | $ 320,865 | |||
Balance, Shares at Dec. 31, 2014 | 48,770,000 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 38,460 | 38,460 | ||||||
Other comprehensive income (loss) | (77,691) | (77,691) | ||||||
Stock-based compensation | 6,219 | 6,219 | ||||||
Stock-based compensation, shares | 8,000 | |||||||
Balance at Jun. 30, 2015 | $ 488 | 553,749 | (152,908) | (113,476) | 287,853 | |||
Balance, Shares at Jun. 30, 2015 | 48,778,000 | |||||||
Balance at Mar. 31, 2015 | (187,500) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 756 | |||||||
Other comprehensive income (loss) | 34,592 | |||||||
Balance at Jun. 30, 2015 | $ 488 | 553,749 | (152,908) | (113,476) | 287,853 | |||
Balance, Shares at Jun. 30, 2015 | 48,778,000 | |||||||
Balance at Dec. 31, 2015 | $ 488 | 556,532 | (149,717) | (18,289) | 389,014 | |||
Balance, Shares at Dec. 31, 2015 | 48,778,000 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Adoption of new accounting standard | $ 915 | $ (915) | ||||||
Net income | 172,551 | 172,551 | ||||||
Other comprehensive income (loss) | 1,301 | 1,301 | ||||||
Stock-based compensation | 8,143 | $ 686 | 8,829 | |||||
Stock-based compensation, shares | 16,000 | |||||||
Purchase of treasury shares | (94,362) | (94,362) | ||||||
Purchase of treasury shares, shares | (2,391,000) | |||||||
Repayment of equity on ordinary shares | (13,920) | (13,920) | ||||||
Balance at Jun. 30, 2016 | $ 488 | 565,590 | (93,676) | (148,416) | 139,427 | 463,413 | ||
Balance, Shares at Jun. 30, 2016 | 46,403,000 | |||||||
Balance at Mar. 31, 2016 | (143,979) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 95,804 | |||||||
Other comprehensive income (loss) | $ (4,437) | |||||||
Purchase of treasury shares, shares | (752,437) | |||||||
Balance at Jun. 30, 2016 | $ 488 | $ 565,590 | $ (93,676) | $ (148,416) | $ 139,427 | $ 463,413 | ||
Balance, Shares at Jun. 30, 2016 | 46,403,000 |
Condensed Consolidated Stateme8
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Cash flows from operating activities | ||
Net income | $ 172,551 | $ 38,460 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | ||
Depreciation and amortization | 47,973 | 44,281 |
Amortization of deferred financing costs and issuance discount | 3,134 | 4,478 |
Deferred income tax | 10,684 | (10,617) |
Stock-based compensation | 8,816 | 6,219 |
Earnings of unconsolidated affiliates, net of dividends | (12,287) | (32,552) |
Unrealized net losses (gains) on foreign exchange forward contracts | 3,965 | (7,747) |
Loss on extinguishment of debt | 95,150 | |
Prepayment penalty on long-term debt | (68,603) | |
Loss on sale of businesses and other assets | 12,915 | |
Changes in assets and liabilities | ||
Accounts receivable | (52,954) | (40,431) |
Inventories | (16,685) | 45,892 |
Accounts payable and other current liabilities | (1,098) | (12,134) |
Income taxes payable | (1,005) | 17,821 |
Other assets, net | (7,060) | (415) |
Other liabilities, net | 10,758 | (5,056) |
Cash provided by operating activities | 179,707 | 74,746 |
Cash flows from investing activities | ||
Capital expenditures | (53,153) | (43,594) |
Proceeds from capital expenditures subsidy | 2,191 | |
Proceeds from the sale of businesses and other assets | 129 | 689 |
Distributions from unconsolidated affiliates | 4,809 | |
Cash used in investing activities | (48,215) | (40,714) |
Cash flows from financing activities | ||
Deferred financing fees | (27,661) | |
Short term borrowings, net | (126) | (15,823) |
Repayments of term loans | (2,500) | |
Purchase of treasury shares | (94,362) | |
Stock-based compensation activity, net | 13 | |
Net proceeds from issuance of 2021 Term Loan B | 498,750 | |
Net proceeds from issuance of 2022 Senior Notes | 716,625 | |
Repayments of 2019 Senior Notes | (1,192,500) | |
Proceeds from Accounts Receivable Securitization Facility | 25,000 | |
Repayments of Accounts Receivable Securitization Facility | (25,000) | |
Cash provided by (used in) financing activities | (96,975) | (20,609) |
Effect of exchange rates on cash | (565) | (3,104) |
Net change in cash and cash equivalents | 33,952 | 10,319 |
Cash and cash equivalents-beginning of period | 431,261 | 220,786 |
Cash and cash equivalents-end of period | $ 465,213 | $ 231,105 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2016 | |
Basis of Presentation | |
Basis of Presentation | NOTE 1—BASIS OF PRESENTATION The unaudited interim condensed consolidated financial statements of Trinseo S.A. and its subsidiaries (the “Company”) as of and for the periods ended June 30, 2016 and 2015 were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and reflect all adjustments, consisting only of normal recurring adjustments, which, in the opinion of management, are considered necessary for the fair statement of the results for the periods presented. Because they cover interim periods, the statements and related notes to the financial statements do not include all disclosures normally provided in annual financial statements and, therefore, these statements should be read in conjunction with the 2015 audited consolidated financial statements included within the Company’s Annual Report on Form 10-K (“Annual Report”) filed with the Securities and Exchange Commission (“SEC”) on March 11, 2016. The December 31, 2015 condensed consolidated balance sheet data presented herein was derived from the Company’s December 31, 2015 audited consolidated financial statements, but does not include all disclosures required by GAAP for annual periods. Certain prior year amounts have been reclassified to conform to the current period presentation. These reclassifications did not have a material impact on the Company’s financial position. Refer to Note 2 for further discussion. |
Recent Accounting Guidance
Recent Accounting Guidance | 6 Months Ended |
Jun. 30, 2016 | |
Recent Accounting Guidance | |
Recent Accounting Guidance | NOTE 2—RECENT ACCOUNTING GUIDANCE In May 2014, the Financial Accounting Standards Board (“FASB”) and the International Accounting Standards Board (“IASB”) jointly issued new guidance which clarifies the principles for recognizing revenue and develops a common revenue standard for GAAP and International Financial Reporting Standards (“IFRS”). The core principle of the guidance is that an entity should recognize 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. Additionally, the FASB has issued certain clarifying updates to this guidance, which the Company will consider as part of our adoption. This guidance is effective for public entities for annual and interim periods beginning after December 15, 2017. The Company is currently assessing the impact of adopting this guidance on its financial position and results of operations. In April 2015, the FASB issued guidance that requires deferred financing fees related to a recognized debt liability be presented in the balance sheet as a direct reduction of the carrying value of that debt liability, consistent with debt discounts. The recognition and measurement guidance for deferred financing fees are not affected. The Company adopted this guidance effective January 1, 2016. Balances as of December 31, 2015 presented herein have been retrospectively adjusted, with $25.7 million of unamortized deferred financing fees being reclassified from “Deferred charges and other assets” and netted against “Long-term debt, net of unamortized deferred financing fees” on the condensed consolidated balance sheet. In accordance with this guidance, unamortized deferred financing fees related to the Company’s revolving debt facilities were not reclassified as a reduction of long-term debt, and remain included within “Deferred charges and other assets” on the condensed consolidated balance sheets. In July 2015, the FASB issued guidance which simplifies the subsequent measurement of inventory by replacing the lower of cost or market test with a lower of cost or net realizable value (“NRV”) test. NRV is calculated as the estimated selling price less reasonably predictable costs of completion, disposal and transportation. This pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2016, and prospective adoption is required. The Company does not expect the impact of adopting this guidance to be material to its financial position and results of operations. In February 2016, the FASB issued new guidance related to leases that outlines a comprehensive lease accounting model and supersedes the current lease guidance. The new guidance requires lessees to recognize on the balance sheet lease liabilities and corresponding right-of-use assets for all leases with terms of greater than 12 months. It also changes the definition of a lease and expands the disclosure requirements of lease arrangements. This new guidance is effective for public companies for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The new guidance must be adopted using a modified retrospective transition, and provides for certain practical expedients. The Company is currently assessing the impact of adopting this guidance on its financial position and results of operations. In March 2016, the FASB issued new guidance that simplifies several aspects of accounting for share-based payments. The Company adopted this guidance effective April 1, 2016. Under this guidance, excess tax benefits associated with share-based payment awards are recognized in the statement of operations when the awards vest or settle, rather than in shareholders’ equity, and all tax-related cash flows resulting from share-based payments are reported as operating activities on the statement of cash flows. In addition, this guidance modified the minimum statutory withholding requirements to allow entities to withhold an amount up to the employees’ maximum individual tax rate in the relevant jurisdiction without triggering liability classification of the award, while also clarifying that all cash payments made to taxing authorities on employees’ behalf for withheld shares are to be reported as financing activities on the statement of cash flows. The adoption of these changes did not materially impact the Company’s financial position and result of operations. Additionally, as part of this adoption, the Company made an accounting policy election to recognize forfeitures as incurred, rather than estimating the forfeitures in advance. The impact of this change was applied utilizing a modified retrospective approach, with an adjustment of $0.9 million recorded during the three months ended June 30, 2016 to decrease opening retained earnings and increase opening additional paid-in-capital . |
Investments in Unconsolidated A
Investments in Unconsolidated Affiliates | 6 Months Ended |
Jun. 30, 2016 | |
Investments in Unconsolidated Affiliates | |
Investments in Unconsolidated Affiliates | NOTE 3—INVESTMENTS IN UNCONSOLIDATED AFFILIATES The Company is supplemented by two strategic joint ventures , the results of which are included within the Basic Plastics & Feedstocks reporting segment: Americas Styrenics LLC (“Americas Styrenics”, a styrene and polystyrene joint venture with Chevron Phillips Chemical Company LP) and Sumika Styron Polycarbonate Limited (“Sumika Styron Polycarbonate”, a polycarbonate joint venture with Sumitomo Chemical Company, Limited). Investments held in the unconsolidated affiliates are accounted for by the equity method. As of June 30, 2016 and December 31, 2015, respectively, the Company’s investment in Americas Styrenics was $154.5 million and $143.9 million, which was $79.7 million and $91.9 million less than the Company’s 50% share of the underlying net assets of Americas Styrenics . This amount represents the difference between the book value of assets contributed to the joint venture at the time of formation (May 1, 2008) and the Company’s 50% share of the total recorded value of the joint venture’s assets and certain adjustments to conform with the Company’s accounting policies. This difference is being amortized over a weighted average remaining useful life of the contributed assets of approximately 4.3 years as of June 30, 2016. The Company received dividends from Americas Styrenics of $30.0 million and $60.0 million during the three and six months ended June 30, 2016, respectively, compared to $30.0 million and $45.0 million during the three and six months ended June 30, 2015, respectively. As of June 30, 2016 and December 31, 2015, respectively, the Company’s investment in Sumika Styron Polycarbonate was $35.8 million and $39.0 million, which was $16.2 million and $19.8 million greater than the Company’s 50% share of the underlying net assets of Sumika Styron Polycarbonate. This amount primarily represents the fair value of certain identifiable assets which have not been recorded on the historical financial statements of Sumika Styron Polycarbonate. This difference is being amortized over the remaining useful life of the contributed assets of 9.3 years as of June 30, 2016. The Company received dividends from Sumika Styron Polycarbonate of zero and $6.2 million during the three and six months ended June 30, 2016, respectively. The Company received no dividends from Sumika Styron Polycarbonate during the three and six months ended June 30, 2015. Both of the unconsolidated affiliates are privately held companies; therefore, quoted market prices for their stock are not available. The summarized financial information of the Company’s unconsolidated affiliates is shown below: Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Sales $ $ $ $ Gross profit $ $ $ $ Net income $ $ $ $ |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2016 | |
Inventories | |
Inventories | NOTE 4—INVENTORIES Inventories consisted of the following: June 30, December 31, 2016 2015 Finished goods $ $ Raw materials and semi-finished goods Supplies Total $ $ |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | NOTE 5—GOODWILL AND INTANGIBLE ASSETS Goodwill The following table shows changes in the carrying amount of goodwill by segment from December 31, 2015 to June 30, 2016: Performance Materials Synthetic Performance Basic Plastics Latex Rubber Plastics & Feedstocks Total Balance at December 31, 2015 $ $ $ $ $ Divestiture (Note 15) — — — Foreign currency impact Balance at June 30, 2016 $ $ $ $ $ Other Intangible Assets The following table provides information regarding the Company’s other intangible assets as of June 30, 2016 and December 31, 2015, respectively: June 30, 2016 December 31, 2015 Estimated Gross Gross Useful Life Carrying Accumulated Carrying Accumulated (Years) Amount Amortization Net Amount Amortization Net Developed technology $ $ $ $ $ $ Manufacturing Capacity Rights Software 5 - 10 Software in development N/A — — Other N/A — — Total $ $ $ $ $ $ As of June 30, 2016, the Company had $15.0 million capitalized as software in development, primarily related to our project to upgrade our legacy enterprise resource planning (“ERP”) environment to the latest version of SAP. During the second quarter of 2016, we began a phased implementation of this ERP environment by geographic region, which we anticipate will be completed by the end of 2016. Amortization expense on other intangible assets totaled $5.8 million and $10.1 million for the three and six months ended June 30, 2016, respectively, and $4.4 million and $8.9 million for the three and six months ended June 30, 2015, respectively. The following table details the Company’s estimated amortization expense for the next five years, excluding any amortization expense related to software currently in development: Estimated Amortization Expense for the Next Five Years Remainder of 2016 $ 2017 2018 2019 2020 2021 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2016 | |
Debt | |
Debt | NOTE 6—DEBT Debt consisted of the following: June 30, December 31, 2016 2015 Senior Credit Facility 2020 Revolving Facility $ — $ — 2021 Term Loan B 2022 Senior Notes USD Notes Euro Notes Accounts Receivable Securitization Facility — — Other indebtedness Total debt Less: current portion Less: unamortized deferred financing fees (1) Total long-term debt, net of unamortized deferred financing fees $ $ (1) As discussed in Note 2, effective January 1, 2016, the Company retroactively adopted new accounting guidance that requires deferred financing fees related to a debt liability be presented in the balance sheet as a direct reduction of the carrying value of that debt liability rather than as deferred assets. This caption reflects this reclassification for both the current and prior periods. Note that this caption does not include deferred financing fees related to the 2020 Revolving Facility and the Accounts Receivable Securitization Facility, which are included within “Deferred charges and other assets” on the condensed consolidated balance sheets . 2018 Senior Secured Credit Facility On June 17, 2010, the Company entered into a credit agreement, which was subsequently amended from time to time, and was to mature in January 2018 (“2018 Senior Secured Credit Facility”). The 2018 Senior Secured Credit Facility included a revolving credit facility (“2018 Revolving Facility”), which, as a result of an amendment in January 2013, included a borrowing capacity of $300.0 million. In May 2015, upon completion of the refinancing transactions discussed below, the Company terminated the 2018 Senior Secured Credit Facility. Immediately prior to this termination, the Company had no outstanding borrowings under the 2018 Revolving Facility. As a result of this termination, the Company recognized a $0.7 million loss on extinguishment of long-term debt during the three and six months ended June 30, 2015, comprised entirely of the write-off of a portion of the existing unamortized deferred financing fees related to the 2018 Revolving Facility. Senior Credit Facility On May 5, 2015, Trinseo Materials Operating S.C.A. and Trinseo Materials Finance, Inc. (together, the “Issuers” or the “Borrowers”), both wholly-owned subsidiaries of the Company, entered into a senior secured credit agreement (the “Credit Agreement”), which provides senior secured financing of up to $825.0 million (the “Senior Credit Facility”). The Senior Credit Facility provides for senior secured financing consisting of a (i) $325.0 revolving credit facility, with a $25.0 million swingline subfacility and a $35.0 million letter of credit subfacility (the “2020 Revolving Facility”) maturing in May 2020 and (ii) $500.0 million senior secured term loan B facility maturing in November 2021 (the “2021 Term Loan B”). Amounts under the 2020 Revolving Facility are available in U.S. dollars and euros. The 2021 Term Loan B bears an interest rate of LIBOR plus 3.25% , subject to a 1.00% LIBOR floor, and was issued at a 0.25% original issue discount. Further, the 2021 Term Loan B requires scheduled quarterly payments in amounts equal to 0.25% of the original principal amount of the 2021 Term Loan B, with the balance to be paid at maturity. As of June 30, 2016, $5.0 million of these scheduled future payments were classified as current debt on the Company’s condensed consolidated balance sheet. Loans under the 2020 Revolving Facility, at the Borrowers’ option, may be maintained as (a) LIBO rate loans, which bear interest at a rate per annum equal to the LIBO rate plus the applicable margin (as defined in the Credit Agreement), if applicable, or (b) base rate loans which shall bear interest at a rate per annum equal to the base rate plus the applicable margin (as defined in the Credit Agreement). As of June 30, 2016, the Borrowers will be required to pay a quarterly commitment fee in respect of any unused commitments under the 2020 Revolving Facility equal to 0.375% per annum. As of June 30, 2016, the Company had no outstanding borrowings, and had $308.9 million (net of $16.1 million outstanding letters of credit) of funds available for borrowing under the 2020 Revolving Facility. The Senior Credit Facility contains certain customary affirmative, negative and financial covenants. As of June 30, 2016, the Company was in compliance with all debt covenant requirements under the Senior Credit Facility. Refer to the Annual Report for further information. 2019 Senior Notes In January 2013, the Company issued $1,325.0 million 8.750% senior notes due to mature on February 1, 2019 (the “2019 Senior Notes”). In July 2014, using proceeds from the Company’s initial public offering in June 2014 (the “IPO”), the Company redeemed $132.5 million in aggregate principal amount of the 2019 Senior Notes . On May 13, 2015, using the net proceeds from the issuance of the 2021 Term Loan B, together with the net proceeds from the issuance of the 2022 Senior Notes (defined and discussed below) and available cash, the Company redeemed all outstanding borrowings under the 2019 Senior Notes, totaling $1,192.5 million in principal, together with a call premium of $68.6 million (with a redemption price of 103% on the first $132.5 million and 106.097% on the remaining balance) and accrued and unpaid interest thereon of $29.6 million. As a result of this redemption, during the three and six months ended June 30, 2015, the Company recorded a loss on extinguishment of long-term debt of $94.5 million, which includes the above $68.6 million call premium and $25.9 million write-off of unamortized deferred financing fees related to the 2019 Senior Notes. 2022 Senior Notes On May 5, 2015, the Issuers executed an indenture (the “Indenture”) pursuant to which they issued $300.0 million aggregate principal amount of 6.750% senior notes due May 1, 2022 (the “USD Notes”) and €375.0 million aggregate principal amount of 6.375% senior notes due May 1, 2022 (the “Euro Notes”, and together with the USD Notes, the “2022 Senior Notes”). Interest on the 2022 Senior Notes is payable semi-annually on May 1 and November 1 of each year, commencing on November 1, 2015. The Indenture contains certain provisions allowing the Issuers’ to redeem the 2022 Senior Notes prior to their maturity. Additionally, the Indenture contains certain customary covenants, which the Company was in compliance with as of June 30, 2016. Refer to the Annual Report for further information . Accounts Receivable Securitization Facility The Company’s accounts receivable securitization facility (“Accounts Receivable Securitization Facility”) has a borrowing capacity of $200.0 million and was set to mature in May 2016. In February 2016, the Company amended the facility to extend the maturity date to May 2019. The Accounts Receivable Securitization Facility is subject to interest charges against the amount of outstanding borrowings as well as the amount of available, but undrawn commitments. In regards to outstanding borrowings, fixed interest charges are 2.60% plus variable commercial paper rates, while for available, but undrawn commitments, fixed interest charges are 1.40% . As of June 30, 2016 and December 31, 2015, there were no amounts outstanding under the Accounts Receivable Securitization Facility, with approximately $129.7 million and $123.4 million, respectively, of accounts receivable available to support this facility, based on the pool of eligible accounts receivable. |
Derivative Instruments
Derivative Instruments | 6 Months Ended |
Jun. 30, 2016 | |
Derivative Instruments [Abstract] | |
Derivative Instruments | NOTE 7—DERIVATIVE INSTRUMENTS The Company’s ongoing business operations expose it to various risks, including fluctuating foreign exchange rates. To manage these risks, the Company periodically enters into derivative financial instruments such as foreign exchange forward contracts. The Company does not hold or enter into financial instruments for trading or speculative purposes. All derivatives are recorded on the condensed consolidated balance sheets at fair value. Foreign Exchange Forward Contracts Certain subsidiaries have assets and liabilities denominated in currencies other than their respective functional currencies, which creates foreign exchange risk. The Company’s principal strategy in managing its exposure to changes in foreign currency exchange rates is to naturally hedge the foreign currency-denominated liabilities on our balance sheet against corresponding assets of the same currency such that any changes in liabilities due to fluctuations in exchange rates are offset by changes in their corresponding foreign currency assets. In order to further reduce its exposure, the Company also uses foreign exchange forward contracts to economically hedge the impact of the variability in exchange rates on our assets and liabilities denominated in certain foreign currencies. These derivative contracts are not designated for hedge accounting treatment. As of June 30, 2016, the Company had open foreign exchange forward contracts with a notional U.S. dollar equivalent absolute value of $155.2 million. The following table displays the notional amounts of the most significant net foreign exchange hedge positions outstanding as of June 30, 2016. June 30, Buy / (Sell) 2016 Chinese Yuan $ Indonesian Rupiah $ Swiss Franc $ Japanese Yen $ British Pound $ Euro $ Foreign Exchange Cash Flow Hedges The Company also enters into forward contracts with the objective of managing the currency risk associated with forecasted U.S. dollar-denominated raw materials purchases by one of its subsidiaries whose functional currency is the euro. By entering into these forward contracts, which are designated as cash flow hedges, the Company buys a designated amount of U.S. dollars and sells euros at the prevailing market rate to mitigate the risk associated with the fluctuations in the euro-to-U.S. dollar foreign currency exchange rates. The qualifying hedge contracts are marked-to-market at each reporting date and any unrealized gains or losses are included in accumulated other comprehensive income (AOCI) to the extent effective, and reclassified to cost of sales in the period during which the transaction affects earnings or it becomes probable that the forecasted transaction will not occur. Open foreign exchange cash flow hedges as of June 30, 2016 have maturities occurring over a period of 18 months, and have a net notional U.S. dollar equivalent of $270.0 million. Net Investment Hedge The Company’s outstanding debt includes €375.0 million of Euro Notes (see Note 6 for details) . As of June 30, 2016, the Company has designated a portion ( €280.0 million) of the principal amount of these Euro Notes as a hedge of the foreign currency exposure of the Issuers’ net investment in certain European subsidiaries. As this debt was deemed to be a highly effective hedge, changes in the Euro Notes’ carrying value resulting from fluctuations in the euro exchange rate were recorded as cumulative foreign currency translation loss of $2.1 million within accumulated other comprehensive loss as of June 30, 2016 . Summary of Derivative Instruments Information regarding changes in the fair value of the Company’s derivative instruments, net of tax, including those not designated for hedge accounting treatment, is as follows: Gain (Loss) Recognized in Gain (Loss) Recognized in AOCI on Balance Sheet Statement of Operations Three Months Ended June 30, Statement of Operations 2016 2015 2016 2015 Classification Designated as Cash Flow Hedges Foreign exchange cash flow hedges $ $ $ $ Cost of sales Total $ $ $ $ Net Investment Hedges Euro Notes $ $ $ — $ — Other expenses, net Total $ $ $ — $ — Not Designated as Cash Flow Hedges Foreign exchange forward contracts $ — $ — $ $ Other expenses, net Total $ — $ — $ $ Gain (Loss) Recognized in Gain (Loss) Recognized in AOCI on Balance Sheet Statement of Operations Six Months Ended June 30, Statement of Operations 2016 2015 2016 2015 Classification Designated as Cash Flow Hedges Foreign exchange cash flow hedges $ $ $ $ Cost of sales Total $ $ $ $ Net Investment Hedges Euro Notes $ $ $ — $ — Other expenses, net Total $ $ $ — $ — Not Designated as Cash Flow Hedges Foreign exchange forward contracts $ — $ — $ $ Other expenses, net Total $ — $ — $ $ The Company recorded losses of $2.1 million and gains of $1.0 million during the three and six months ended June 30, 2016, respectively, and gains of $7.3 million and losses of $13.7 million during the three and six months ended June 30, 2015, respectively, from settlements and changes in the fair value of outstanding forward contracts (not designated as hedges) . The gains and losses from these forward contracts offset net foreign exchange transaction gains of $2.3 million and losses of $2.6 million during the three and six months ended June 30, 2016, respectively, and losses of $10.4 million and gains of $7.6 million during the three and six months ended June 30, 2015, respectively, which resulted from the remeasurement of the Company’s foreign currency denominated assets and liabilities. The cash settlements of these foreign exchange forward contracts are included within operating activities in the condensed consolidated statement of cash flows. As of June 30, 2016, the Company has no ineffectiveness related to its foreign exchange cash flow hedges. Further, the Company expects to reclassify in the next twelve months an approximate $2.3 million net gain from other comprehensive income (loss) into earnings related to the Company’s outstanding cash flow hedges as of June 30, 2016 based on current foreign exchange rates. The following table summarizes the net unrealized gains and losses and balance sheet classification of outstanding derivatives recorded in the condensed consolidated balance sheets: June 30, 2016 December 31, 2015 Foreign Exchange Foreign Exchange Foreign Exchange Foreign Exchange Forward Cash Flow Forward Cash Flow Balance Sheet Classification Contracts Hedges Total Contracts Hedges Total Asset Derivatives: Accounts receivable, net of allowance $ $ $ $ $ $ Deferred charges and other assets — — — — Total asset derivatives $ $ $ $ $ $ Liability Derivatives: Accounts payable $ $ $ $ $ — $ Other noncurrent obligations — — — — — — Total liability derivatives $ $ $ $ $ — $ Forward contracts are entered into with a limited number of counterparties, each of which allows for net settlement of all contracts through a single payment in a single currency in the event of a default on or termination of any one contract. As such, in accordance with the Company’s accounting policy, we record these foreign exchange forward contracts on a net basis by counterparty within the condensed consolidated balance sheet. Information regarding the gross amounts of the Company’s derivative instruments and the amounts offset in the condensed consolidated balance sheets is as follows: Gross Amounts Gross Amounts Net Amounts Recognized in the Offset in the Presented in the Balance Sheet Balance Sheet Balance Sheet Balance at June 30, 2016 Derivative assets $ $ $ Derivative liabilities Balance at December 31, 2015 Derivative assets $ $ $ Derivative liabilities Refer to Notes 8 and 17 of the condensed consolidated financial statements for further information regarding the fair value of the Company’s derivative instruments and the related changes in accumulated other comprehensive income . |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value Measurements | |
Fair Value Measurements | NOTE 8—FAIR VALUE MEASUREMENTS Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date. Level 1—Valuation is based upon quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2—Valuation is based upon quoted prices for similar assets and liabilities in active markets, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3—Valuation is based upon other unobservable inputs that are significant to the fair value measurement. The following table summarizes the basis used to measure certain assets and liabilities at fair value on a recurring basis in the condensed consolidated balance sheets as of June 30, 2016 and December 31, 2015. June 30, 2016 Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Items Inputs Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—Assets $ — $ $ — $ Foreign exchange forward contracts—(Liabilities) — — Foreign exchange cash flow hedges—Assets — — Foreign exchange cash flow hedges—(Liabilities) — — Total fair value $ — $ $ — $ December 31, 2015 Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Items Inputs Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—Assets $ — $ $ — $ Foreign exchange forward contracts—(Liabilities) — — Foreign exchange cash flow hedges—Assets — — Total fair value $ — $ $ — $ The Company uses an income approach to value its derivative instruments, utilizing discounted cash flow techniques, considering the terms of the contract and observable market information available as of the reporting date. Significant inputs to the valuation for foreign exchange forward contracts and foreign exchange cash flow hedges are obtained from broker quotations or from listed or over-the-counter market data, and are classified as Level 2 in the fair value hierarchy. Fair Value of Debt Instruments The following table presents the estimated fair value of the Company’s outstanding debt not carried at fair value as of June 30, 2016 and December 31, 2015, respectively: As of As of June 30, 2016 December 31, 2015 2022 Senior Notes USD Notes Euro Notes 2021 Term Loan B Total fair value $ $ The fair value of the Company’s Term Loan B, USD Notes, and Euro Notes (each Level 2 securities) is determined using over-the-counter market quotes and benchmark yields received from independent vendors. There were no other significant financial instruments outstanding as of June 30, 2016 and December 31, 2015. |
Provision for Income Taxes
Provision for Income Taxes | 6 Months Ended |
Jun. 30, 2016 | |
Provision for Income Taxes | |
Income Taxes | NOTE 9—PROVISION FOR INCOME TAXES Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Effective income tax rate % % % % Provision for income taxes for the three and six months ended June 30, 2016 were $ 28.6 million, resulting in an effective tax rate of 23.0% , and $50.5 million, resulting in an effective tax rate of 22.6% , respectively. Provision for income taxes for the three and six months ended June 30, 2015 were $ 7.5 million, resulting in an effective tax rate of 90.9% , and $25.4 million, resulting in an effective tax rate of 39.8% , respectively . The effective income tax rate for the three and six months ended June 30, 2016 was impacted by losses generated primarily within our holding companies incorporated in Luxembourg and our primary operating company incorporated in Brazil, which were not anticipated to provide a tax benefit to the Company in the future. For the three and six months ended June 30, 2016, these losses totaled approximately $29.0 million and $41.7 million, respectively. Included in these losses was an impairment charge of $12.9 million for the estimated loss on sale of Trinseo Brazil. Refer to Note 15 for further information. The effective income tax rate for the three and six months ended June 30, 2015 was impacted by losses generated primarily within our holding companies incorporated in Luxembourg, which were not anticipated to provide a tax benefit to the Company in the future. For the three and six months ended June 30, 2015, these losses totaled approximately $41.2 million and $58.8 million, respectively. Included in these losses were payments made during the three months ended June 30, 2015 of $18.1 million related to a portion of the fees associated with the call premium paid to retire the Company’s 2019 Senior Notes and $4.3 million related to the write-off of the related unamortized deferred financing fees. Refer to Note 6 for further information. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure | |
Commitments and Contingencies | NOTE 10—COMMITMENTS AND CONTINGENCIES Environmental Matters Accruals for environmental matters are recorded when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated, based on current law, existing technologies and other information. As of June 30, 2016 and December 31, 2015, the Company had no accrued obligations for environmental remediation and restoration costs. Pursuant to the terms of the sales and purchase agreement for the Styron business, the pre-closing environmental conditions were retained by Dow and the Company has been indemnified by Dow from and against all environmental liabilities incurred or relating to the predecessor periods. There are several properties which the Company now owns on which Dow has been conducting investigation, monitoring or remediation to address historical contamination. Those properties include Allyn’s Point, Connecticut; Dalton, Georgia; and Livorno, Italy. There are other properties with historical contamination that are owned by Dow that the Company leases for its operations, including its facilities in Midland, Michigan; Schkopau, Germany; and Terneuzen, The Netherlands. No environmental claims have been asserted or threatened against the Company, and the Company is not a potentially responsible party at any Superfund Sites. Inherent uncertainties exist in the Company’s potential environmental liabilities primarily due to unknown conditions, whether future claims may fall outside the scope of the indemnity, changing governmental regulations and legal standards regarding liability, and evolving technologies for handling site remediation and restoration. In connection with the Company’s existing indemnification, the possibility is considered remote that environmental remediation costs will have a material adverse impact on the condensed consolidated financial statements. Purchase Commitments In the normal course of business, the Company has certain raw material purchase contracts where it is required to purchase certain minimum volumes at current market prices. These commitments range from 1 to 5 years. In certain raw material purchase contracts, the Company has the right to purchase less than the required minimums and pay a liquidated damages fee, or, in case of a permanent plant shutdown, to terminate the contracts. In such cases, these obligations would be less than the annual commitment as disclosed in the consolidated financial statements included in the Annual Report. Litigation Matters From time to time, the Company may be subject to various legal claims and proceedings incidental to the normal conduct of business, relating to such matters as product liability, antitrust/competition, past waste disposal practices and release of chemicals into the environment. While it is impossible at this time to determine with certainty the ultimate outcome of these routine claims, the Company does not believe that the ultimate resolution of these claims will have a material adverse effect on the Company’s results of operations, financial condition or cash flow. Legal costs, including those legal costs expected to be incurred in connection with a loss contingency, are expensed as incurred. |
Pension Plans and Other Postret
Pension Plans and Other Postretirement Benefits | 6 Months Ended |
Jun. 30, 2016 | |
Pension Plans and Other Postretirement Benefits | |
Pension Plans and Other Postretirement Benefits | NOTE 11—PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS The components of net periodic benefit costs for all significant plans were as follows: Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Defined Benefit Pension Plans Service cost $ $ $ $ Interest cost Expected return on plan assets Amortization of prior service credit Amortization of net loss Net periodic benefit cost $ $ $ $ Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Other Postretirement Plans Service cost $ $ $ $ Interest cost Amortization of prior service cost Amortization of net gain — — Net periodic benefit cost $ $ $ $ As of June 30, 2016 and December 31, 2015, the Company’s benefit obligations included primarily in “Other noncurrent obligations” in the condensed consolidated balance sheets were $181.3 million and $172.5 million, respectively. The net periodic benefit costs are recognized in the condensed consolidated statement of operations as “Cost of sales” and “Selling, general and administrative expenses.” The Company made cash contributions of approximately $2.4 million and $5.3 million during the three and six months ended June 30, 2016. The Company expects to make additional cash contributions, including benefit payments to unfunded plans, of approximately $11.0 million to its defined benefit plans for the remainder of 2016. Supplemental Employee Retirement Plan The Company established a non-qualified supplemental employee retirement plan in 2010. As of December 31, 2015, benefit obligations under this plan were $13.7 million, noting $1.6 million of net loss included in AOCI, of which $1.0 million was expected to be amortized from AOCI into net periodic benefit cost in 2016. Lastly, as of December 31, 2015, the estimated future benefit payments under this plan were $13.9 million, expected to be paid in 2017. During the six months ended June 30, 2016, this retirement plan was amended to, among other things, extend the employment period covered by the plan, resulting in an increase to the benefit obligation under this plan of $1.3 million and a corresponding actuarial loss recorded to AOCI. The amounts expected to be amortized from AOCI into net periodic benefit cost for 2016 remains approximately $1.0 million. As a result of this amendment, the estimated future benefit payments under this plan were $15.3 million as of June 30, 2016, and are expected to be paid in 2018. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2016 | |
Stock-Based Compensation | |
Stock-Based Compensation | NOTE 12—STOCK-BASED COMPENSATION Restricted Stock Awards issued by the Parent On June 17, 2010, Bain Capital Everest Manager Holding SCA (“the Parent”), an affiliate of Bain Capital, authorized the issuance of up to 750,000 shares in time-based and performance-based restricted stock to certain key members of management. Any related compensation associated with these awards is allocated to the Company from the Parent. With the adoption of the Trinseo S.A. 2014 Omnibus Incentive Plan (“2014 Omnibus Plan”) during 2014, discussed further below, restricted stock awards are no longer issued by the Parent on behalf of the Company. Time-based Restricted Stock Awards For the six month period ended June 30, 2016, there were no grants of time-based restricted stock awards. Total compensation expense for time-based restricted stock awards was $0.4 million and $0.9 million for the three months ended June 30, 2016 and 2015, respectively, and $0.8 million and $2.1 million for the six months ended June 30, 2016 and 2015, respectively. As of June 30, 2016, there was $0.8 million of total unrecognized compensation cost related to time-based restricted stock awards, which is expected to be recognized over a weighted-average period of 1.3 years. Modified Time-based Restricted Stock Awards For the six month period ended June 30, 2016, there were no grants of modified time-based restricted stock awards. Total compensation expense recognized for modified time-based restricted stock awards was $0.7 million and $0.9 million for the three months ended June 30, 2016 and 2015, respectively, and $1.5 million and $1.8 million for the six months ended June 30, 2016 and 2015, respectively. As of June 30, 2016, there was $3.0 million of total unrecognized compensation cost related to the modified time-based restricted stock awards, which is expected to be recognized over a weighted-average period of 1.1 years. 2014 Omnibus Incentive Plan In connection with the IPO, the Company’s board of directors approved the 2014 Omnibus Plan, adopted on May 28, 2014, under which the maximum number of ordinary shares that may be delivered upon satisfaction of awards granted under such plan is 4.5 million shares. Since that time, the board of directors of the Company has approved equity award grants for certain executives and employees, comprised of restricted share units (or RSUs) and options to purchase shares (“option awards”). Restricted Share Units (RSUs) The RSUs granted to executives and employees vest in full on the third anniversary of the date of grant, generally subject to the employee remaining continuously employed by the Company on the vesting date. RSUs granted to directors of the Company vest in full on the first anniversary of the date of grant. Upon a termination of employment due to the employee’s death or retirement or a termination of employment by the Company without cause in connection with a restructuring or redundancy or due to the employee’s disability prior to the vesting date, the RSUs will vest in full or in part, depending on the type of termination. In the event employment is terminated for cause, all unvested RSUs will be forfeited. Dividends and dividend equivalents will not accumulate on unvested RSUs. Compensation costs for the RSUs are measured at the grant date based on the fair value of the award and are recognized ratably as expense over the applicable vesting term. The fair value of RSUs is equal to the fair market value of the Company’s ordinary shares based on the closing price on the date of grant. During the three and six months ended June 30, 2016, the Company granted 21,446 and 340,551 RSUs, respectively, at a weighted-average grant date fair value per unit of $47.45 and $28.26 , respectively. Total compensation expense recognized for all outstanding RSUs was $1.4 million and $2.5 million for the three and six months ended June 30, 2016, respectively, and $0.5 million and $0.7 million for the three and six months ended June 30, 2015, respectively. As of June 30, 2016, there was $12.4 million of total unrecognized compensation cost related to outstanding RSUs, which is expected to be recognized over a weighted-average period of 2.3 years. Option Awards The option awards, which contain an exercise term of nine years from the date of grant, vest in three equal annual installments beginning on the first anniversary of the date of grant, generally subject to the employee remaining continuously employed on the applicable vesting date. Upon a termination of employment due to the employee’s death or retirement or a termination of employment by the Company without cause in connection with a restructuring or redundancy or due to the employee’s disability prior to a vesting date, the options will vest in full or will continue to vest on the original vesting schedule, depending on the type of termination. In the event employment is terminated for cause, all vested and unvested options will be forfeited. Compensation cost for the option awards is measured at the grant date based on the fair value of the award and is recognized as expense over the appropriate service period utilizing graded vesting. The fair value for option awards is computed using the Black-Scholes pricing model, whose inputs and assumptions are determined as of the date of grant. Determining the fair value of the option awards requires considerable judgment, including estimating the expected term of stock options and the expected volatility of the price of the Company’s ordinary shares. During the three and six months ended June 30, 2016, the Company granted 27,404 and 568,981 option awards, respectively, at a weighted-average grant date fair value per option award of $14.16 and $10.10 , respectively. Since the Company’s equity interests were privately held prior to the IPO in June 2014, there is limited publicly traded history of the Company’s ordinary shares. Until such time that the Company has enough publicly traded history of its ordinary shares to determine expected volatility based solely on its ordinary shares, estimated volatility of options granted will be based on a combination of our historical volatility and similar companies’ stock that are publicly traded. The expected term of options represents the period of time that options granted are expected to be outstanding. For the options granted during the three and six months ended June 30, 2016, the simplified method was used to calculate the expected term of options, given the Company’s limited historical exercise data. The risk-free interest rate for the periods within the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The dividend yield is estimated based on historical and expected dividend activity. The following are the weighted-average assumptions used within the Black-Scholes pricing model for options granted during the six months ended June 30, 2016: Six Months Ended June 30, 2016 Expected term (in years) Expected volatility % Risk-free interest rate % Dividend yield % Total compensation expense for the option awards was $0.8 million and $4.1 million for the three and six months ended June 30, 2016, respectively, and $1.2 million and $1.4 million for the three and six months ended June 30, 2015, respectively. As of June 30, 2016, there was $2.8 million of total unrecognized compensation cost related to the option awards, which is expected to be recognized over a weighted-average period of 1.4 years . Adoption of Accounting Standards Update As discussed in Note 2, effective April 1, 2016, the Company adopted new accounting guidance issued by the FASB that simplifies several aspects of accounting for share-based payments. Among other things , as part of this adoption, the Company made an accounting policy election to recognize forfeitures as incurred, rather than estimating the forfeitures in advance. The impact of this change was applied utilizing a modified retrospective approach, with an adjustment of $0.9 million recorded during the three months ended June 30, 2016 to decrease opening retained earnings and increase opening additional paid-in-capital. All other impacts of this adoption were not material to the Company’s financial position and results of operations. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2016 | |
Related Party Transactions | |
Related Party Transactions | NOTE 13—RELATED PARTY TRANSACTIONS In connection with the Acquisition, the Company entered into a ten year initial term advisory agreement with Bain Capital Partners, LLC and Portfolio Company Advisors Limited (the “Advisory Agreement”) wherein Bain Capital Partners, LLC and Portfolio Company Advisors Limited provides management and consulting services and financial and other advisory services to the Company. The Advisory Agreement terminated upon consummation of the Company’s IPO in June 2014 . Bain Capital will continue to provide an immaterial level of ad hoc advisory services for the Company going forward. In conjunction with the foregoing, we incurred Bain Capital Partners, LLC and Portfolio Company Advisors Limited fees (including out-of-pocket expenses) of zero for the three and six months ended June 30, 2016, respectively, and $0.1 million and $0.2 million for the three and six months ended June 30, 2015, respectively. In March 2016, the Company announced that the Parent agreed to sell 10,600,000 ordinary shares pursuant to the Company’s shelf registration statement filed with the SEC. In May 2016, the Parent agreed to sell an additional 8,000,000 ordinary shares (see Note 18 for further details). In connection with these offerings, and under the terms of the Acquisition, the Company incurred advisory, accounting, legal and printing expenses on behalf of the Parent of $0.3 million and $2.2 million during the three and six months ended June 30, 2016, respectively. These expenses were included within “Selling, general and administrative expenses” on the condensed consolidated statement of operations. |
Segments
Segments | 6 Months Ended |
Jun. 30, 2016 | |
Segments | |
Segments | NOTE 14—SEGMENTS The Company operates under two divisions: Performance Materials and Basic Plastics & Feedstocks. The Performance Materials division includes the following reporting segments: Synthetic Rubber, Latex, and Performance Plastics. The Basic Plastics & Feedstocks division represents a separate segment for financial reporting purposes. The Latex segment produces SB latex primarily for coated paper and packaging board, carpet and artificial turf backings, as well as a number of performance latex applications. The Synthetic Rubber segment produces synthetic rubber products used predominantly in tires, with additional applications in polymer modification and technical rubber goods, including conveyer and fan belts, hoses, seals and gaskets. The Performance Plastics segment produces highly engineered compounds and blends for automotive end markets, as well as consumer electronics, medical, electrical and lighting, collectively consumer essential markets, or CEM. The Basic Plastics & Feedstocks segment includes styrenic polymers, polycarbonate, or PC, and styrene monomer, and also includes the results of the Company’s two 50% -owned joint ventures, Americas Styrenics and Sumika Styron Polycarbonate . Performance Materials Synthetic Performance Basic Plastics Corporate Three Months Ended Latex Rubber Plastics & Feedstocks Unallocated Total June 30, 2016 Sales to external customers $ $ $ $ $ — $ Equity in earnings (losses) of unconsolidated affiliates — — — — EBITDA (1) Investment in unconsolidated affiliates — — — — Depreciation and amortization June 30, 2015 Sales to external customers $ $ $ $ $ — $ Equity in earnings (losses) of unconsolidated affiliates — — — — EBITDA (1) Investment in unconsolidated affiliates — — — — Depreciation and amortization Performance Materials Synthetic Performance Basic Plastics Corporate Six Months Ended Latex Rubber Plastics & Feedstocks Unallocated Total June 30, 2016 Sales to external customers $ $ $ $ $ — $ Equity in earnings (losses) of unconsolidated affiliates — — — — EBITDA (1) Investment in unconsolidated affiliates — — — — Depreciation and amortization June 30, 2015 Sales to external customers $ $ $ $ $ — $ Equity in earnings (losses) of unconsolidated affiliates — — — — EBITDA (1) Investment in unconsolidated affiliates — — — — Depreciation and amortization (1) Reconciliation of EBITDA to net income (loss) is as follows: Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Total segment EBITDA $ $ $ $ Corporate unallocated Less: Interest expense, net Less: Provision for income taxes Less: Depreciation and amortization Net income $ $ $ $ Corporate unallocated includes corporate overhead costs and certain other income and expenses, as well as loss on extinguishment of long-term debt. The primary measure of segment operating performance is EBITDA, which is defined as net income (loss) before interest, income taxes, depreciation and amortization. EBITDA is a key metric that is used by management to evaluate business performance in comparison to budgets, forecasts, and prior year financial results, providing a measure that management believes reflects the Company’s core operating performance. EBITDA is useful for analytical purposes; however, it should not be considered an alternative to the Company’s reported GAAP results, as there are limitations in using such financial measures. Other companies in the industry may define EBITDA differently than the Company, and as a result, it may be difficult to use EBITDA, or similarly-named financial measures, that other companies may use to compare the performance of those companies to the Company’s performance. Asset and capital expenditure information is not accounted for at the segment level and consequently is not reviewed or included with the Company’s internal management reporting. Therefore, the Company has not disclosed asset and capital expenditure information for each reportable segment. |
Divestitures
Divestitures | 6 Months Ended |
Jun. 30, 2016 | |
Divestitures | |
Divestitures | NOTE 15—DIVESTITURES Divestiture of Brazil Business During the second quarter of 2016, the Company signed a definitive agreement to sell Trinseo do Brasil Comercio de Produtos Quimicos Ltda. (“Trinseo Brazil”), its primary operating entity in Brazil which includes both a latex and automotive business. Under the agreement of sale, which is expected to close no later than the fourth quarter of 2016, Trinseo Brazil will be sold to a single counterparty, for a selling price that is subject to certain contingent consideration payments, which could be paid by the buyer over a 5 -year period subsequent to the closing date, based on the results of the Trinseo Brazil latex business during that time. As a result of this agreement, during the three and six months ended June 30, 2016, the Company recorded an impairment charge for the estimated loss on sale of approximately $12.9 million within “Other expense, net” in the condensed consolidated statement of operations. This charge primarily relates to the unrecoverable net book value of property, plant and equipment along with certain working capital balances and has been allocated as $8.6 million, $4.0 million, and $0.3 million to the Performance Plastics segment, Latex segment, and Corporate, respectively. This loss on sale has been recorded as an estimate based on available information and is subject to change through the completion of the sale. In addition, as of June 30, 2016, the Company recorded all assets and liabilities associated with Trinseo Brazil as held-for-sale within “Other current assets” and “Accrued expenses and other current liabilities,” respectively, in the condensed consolidated balance sheet. The key components of the assets, adjusted for the above impairment charges, and liabilities classified as held-for-sale at June 30, 2016 consisted of the following: June 30, 2016 Assets Accounts receivable, net of allowance for doubtful accounts $ Inventories Goodwill Deferred charges and other assets Total assets held-for-sale $ Liabilities Accounts payable $ Income taxes payable Accrued expenses and other current liabilities Other non-current obligations Total liabilities held-for-sale $ The results of operations associated with the latex and automotive businesses of Trinseo Brazil were not classified as discontinued operations as the decision to divest these businesses does not represent a strategic shift that has, or will have, a major effect on the Company’s financial position or results of operations. EPS Divestiture In June 2013, the Company’s board of directors approved the sale of its expandable polystyrene (“EPS”) business within the Company’s Basic Plastics & Feedstocks segment, under a sale and purchase agreement which was signed in July 2013 and closed on September 30, 2013. Under the terms of the sale and purchase agreement, should the divested EPS business record EBITDA (as defined therein) greater than zero for fiscal year 2014, the Company would receive an incremental payment of €0.5 million. The EBITDA threshold was met for fiscal year 2014 and the Company received the €0.5 million payment (approximately $0.6 million based upon the applicable foreign exchange rate in the period the payment was received) during the first quarter of 2015, which is reflected within cash flows used in investing activities in the condensed consolidated statement of cash flows for the six months ended June 30, 2015. |
Restructuring
Restructuring | 6 Months Ended |
Jun. 30, 2016 | |
Restructuring | |
Restructuring | NOTE 16—RESTRUCTURING Divestiture of Brazil Business As discussed in Note 15, during the second quarter of 2016, the Company signed a definitive agreement to sell Trinseo Brazil. While the majority of the Company’s current operations in Brazil will be transferred to the buyer, certain corporate functions not included in the sale will be eliminated by the Company prior to the completion of the sale, resulting in the exit of all direct operations in Brazil. As a result, for the three and six months ended June 30, 2016, the Company recorded restructuring charges of $0.6 million related to employee termination benefit charges, which are included within “Selling, general, and administrative expenses” in the condensed consolidated statements of operations and were allocated entirely to Corporate. As no amounts related to these charges have been paid as of June 30, 2016, the entire balance of these charges is recorded within “Accrued expenses and other current liabilities” in the condensed consolidated balance sheet. Allyn’s Point Plant Shutdown In September 2015, the Company approved the plan to close its Allyn’s Point latex manufacturing facility in Gales Ferry, Connecticut. This restructuring plan was a strategic business decision to improve the results of the overall Latex segment due to continuing declines in the coated paper industry in North America. Production at the facility ceased at the end of 2015, followed by decommissioning activities which began in 2016. The Company recorded restructuring charges of zero and $0.5 million for the three and six months ended June 30, 2016, respectively, relating to the accelerated depreciation of the related assets at the Allyn’s Point facility, and $0.5 million and $1.2 million, respectively, of employee termination benefit and decommissioning charges, which are included within “Selling, general and administrative expenses” in the condensed consolidated statements of operations and were allocated entirely to the Latex segment. No charges were incurred during the three and six months ended June 30, 2015. Employee termination benefit charges are recorded within “Accrued expenses and other current liabilities” in the condensed consolidated balance sheet, the balances for which are displayed in the below table . Balance at Balance at December 31, 2015 Expenses Deductions (1) June 30, 2016 Employee termination benefit charges $ $ $ $ Other (2) — — Total $ $ $ $ (1) Includes payments made against the existing accrual. (2) Includes decommissioning charges incurred, primarily related to labor and third party service costs. The Company does not expect to incur additional employee termination benefit charges related to this restructuring, with the majority of the benefits expected to be paid by December 31, 2016. The Company also expects to incur additional decommissioning costs associated with this plant shutdown in 2016, the cost of which will be expensed as incurred, within the Latex segment. Restructuring in Polycarbonate During the second quarter of 2014, the Company announced a restructuring within its Basic Plastics & Feedstocks segment to exit the commodity market for PC in North America and to terminate existing arrangements with Dow regarding manufacturing services for the Company at Dow’s Freeport, Texas facility (the “Freeport facility”). Production at the Freeport facility ceased as of September 30, 2014, and decommissioning and demolition was completed in the first quarter of 2015. For the three and six months ended June 30, 2015, the Company recorded restructuring charges of zero and $0.5 million, respectively, related to the reimbursement of decommissioning and demolition costs incurred by Dow. These charges were included in “Selling, general and administrative expenses” in the condensed consolidated statements of operations, and were allocated entirely to the Basic Plastics & Feedstocks segment. There were no remaining amounts accrued in the condensed consolidated balance sheet as of December 31, 2015. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 6 Months Ended |
Jun. 30, 2016 | |
Shareholders' Equity. | |
Accumulated Other Comprehensive Income (Loss) | NOTE 17—ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The components of accumulated other comprehensive income (AOCI) , net of income taxes, consisted of: Currency Pension & Other Foreign Exchange Translation Postretirement Benefit Cash Flow Three Months Ended June 30, 2016 and 2015 Adjustments Plans, Net Hedges, Net Total Balance as of March 31, 2016 $ $ $ $ Other comprehensive income (loss) — Amounts reclassified from AOCI to net income (1) — Balance as of June 30, 2016 $ $ $ $ Balance as of March 31, 2015 $ $ $ $ Other comprehensive income (loss) — Amounts reclassified from AOCI to net income (1) — Balance as of June 30, 2015 $ $ $ $ Currency Pension & Other Foreign Exchange Translation Postretirement Benefit Cash Flow Six Months Ended June 30, 2016 and 2015 Adjustments Plans, Net Hedges, Net Total Balance at December 31, 2015 $ $ $ $ Other comprehensive income (loss) Amounts reclassified from AOCI to net income (1) — Balance at June 30, 2016 $ $ $ $ Balance at December 31, 2014 $ $ $ — $ Other comprehensive income (loss) — Amounts reclassified from AOCI to net income (1) — Balance at June 30, 2015 $ $ $ $ (1) The following is a summary of amounts reclassified from AOCI to net income for the three and six months ended June 30, 2016 and 2015, respectively: Amount Reclassified from AOCI Amount Reclassified from AOCI AOCI Components Three Months Ended June 30, Six Months Ended June 30, Statement of Operations 2016 2015 2016 2015 Classification Cash flow hedging items Foreign exchange cash flow hedges $ $ $ $ Cost of sales Total before tax Tax effect — — Provision for income taxes Total, net of tax $ $ $ $ Amortization of pension and other postretirement benefit plan items Prior service credit $ $ $ $ (a) Net actuarial loss (a) Total before tax Tax effect Provision for income taxes Total, net of tax $ $ $ $ (a) These AOCI components are included in the computation of net periodic benefit costs (see Note 11). |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Jun. 30, 2016 | |
Shareholders' Equity. | |
Shareholders' Equity | NOTE 18—SHAREHOLDERS’ EQUITY Secondary Offerings and Tender Offer In March 2016, the Company announced that the Parent agreed to sell 10,600,000 of the Company’s ordinary shares pursuant to the Company’s shelf registration statement filed with the SEC. Goldman, Sachs & Co. acted as the sole bookrunning manager for the offering (the “Underwriter”). The Underwriter purchased these shares from the Parent at a price of $35.63 per share. In May 2016, the Underwriter purchased an additional 8,000,000 of the Company’s ordinary shares from the Parent at a price of $42.90 . No ordinary shares were sold by the Company as a result of these transactions. Concurrently with the completion of the offering in March 2016, the Company agreed to repurchase from the Underwriter 1,600,000 of the ordinary shares that were sold by the Parent in the offering at the same $35.63 price per share paid by the Underwriter to the Parent, resulting in an aggregate purchase price of $57.0 million. These repurchased shares have been recorded at cost within “Treasury shares” in the condensed consolidated balance sheet as of June 30, 2016. Additionally, because a repurchase transaction was completed as part of the offering, in order to satisfy certain requirements of Luxembourg law, promptly following the completion of the offering, the Company commenced a tender offer to purchase up to an additional 1,165,000 shares from its shareholders (other than the Parent) at the same price per share that it paid to the Underwriter for the shares repurchased as part of this offering. The tender offer expired on April 25, 2016, with 38,702 ordinary shares repurchased by the Company for an aggregate purchase price of $1.4 million. Share Repurchases and Repayment of Equity During the second quarter of 2016, the Company purchased an additional 752,437 ordinary shares from its shareholders through a combination of open market transactions for an aggregate purchase price of $36.0 million. These repurchased shares have been recorded at cost within “Treasury shares” in the condensed consolidated balance sheet as of June 30, 2016. In June 2016 , pursuant the authority granted to it by its shareholders, the Company’s board of directors declared a repayment of equity of $0.30 per ordinary share payable in cash on July 20, 2016 to shareholders of record as of the close of business on July 6, 2016 . The total amount payable of $13.9 million was recorded within “Accrued expenses and other current liabilities” on the Company’s condensed consolidated balance sheet as of June 30, 2016. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share | |
Earnings Per Share | NOTE 19—EARNINGS PER SHARE Basic earnings per ordinary share (“basic EPS”) is computed by dividing net income available to ordinary shareholders by the weighted average number of the Company’s ordinary shares outstanding for the applicable period. Diluted earnings per ordinary share (“diluted EPS”) is calculated using net income available to ordinary shareholders divided by diluted weighted-average ordinary shares outstanding during each period, which includes unvested RSUs and stock option awards. Diluted EPS considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential ordinary shares would have an anti-dilutive effect. The following table presents basic EPS and diluted EPS for the three and six months ended June 30, 2016 and 2015, respectively. Three Months Ended Six Months Ended June 30, June 30, (in thousands, except per share data) 2016 2015 2016 2015 Earnings: Net income $ $ $ $ Shares: Weighted-average ordinary shares outstanding Dilutive effect of RSUs and option awards* Diluted weighted-average ordinary shares outstanding Income per share: Income per share—basic $ $ $ $ Income per share—diluted $ $ $ $ * Refer to Note 12 for discussion of RSUs and option awards granted to certain Company directors and employees. |
Recent Accounting Guidance (Pol
Recent Accounting Guidance (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
Basis of Presentation | |
Recent Accounting Guidance | In May 2014, the Financial Accounting Standards Board (“FASB”) and the International Accounting Standards Board (“IASB”) jointly issued new guidance which clarifies the principles for recognizing revenue and develops a common revenue standard for GAAP and International Financial Reporting Standards (“IFRS”). The core principle of the guidance is that an entity should recognize 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. Additionally, the FASB has issued certain clarifying updates to this guidance, which the Company will consider as part of our adoption. This guidance is effective for public entities for annual and interim periods beginning after December 15, 2017. The Company is currently assessing the impact of adopting this guidance on its financial position and results of operations. In April 2015, the FASB issued guidance that requires deferred financing fees related to a recognized debt liability be presented in the balance sheet as a direct reduction of the carrying value of that debt liability, consistent with debt discounts. The recognition and measurement guidance for deferred financing fees are not affected. The Company adopted this guidance effective January 1, 2016. Balances as of December 31, 2015 presented herein have been retrospectively adjusted, with $25.7 million of unamortized deferred financing fees being reclassified from “Deferred charges and other assets” and netted against “Long-term debt, net of unamortized deferred financing fees” on the condensed consolidated balance sheet. In accordance with this guidance, unamortized deferred financing fees related to the Company’s revolving debt facilities were not reclassified as a reduction of long-term debt, and remain included within “Deferred charges and other assets” on the condensed consolidated balance sheets. In July 2015, the FASB issued guidance which simplifies the subsequent measurement of inventory by replacing the lower of cost or market test with a lower of cost or net realizable value (“NRV”) test. NRV is calculated as the estimated selling price less reasonably predictable costs of completion, disposal and transportation. This pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2016, and prospective adoption is required. The Company does not expect the impact of adopting this guidance to be material to its financial position and results of operations. In February 2016, the FASB issued new guidance related to leases that outlines a comprehensive lease accounting model and supersedes the current lease guidance. The new guidance requires lessees to recognize on the balance sheet lease liabilities and corresponding right-of-use assets for all leases with terms of greater than 12 months. It also changes the definition of a lease and expands the disclosure requirements of lease arrangements. This new guidance is effective for public companies for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The new guidance must be adopted using a modified retrospective transition, and provides for certain practical expedients. The Company is currently assessing the impact of adopting this guidance on its financial position and results of operations. In March 2016, the FASB issued new guidance that simplifies several aspects of accounting for share-based payments. The Company adopted this guidance effective April 1, 2016. Under this guidance, excess tax benefits associated with share-based payment awards are recognized in the statement of operations when the awards vest or settle, rather than in shareholders’ equity, and all tax-related cash flows resulting from share-based payments are reported as operating activities on the statement of cash flows. In addition, this guidance modified the minimum statutory withholding requirements to allow entities to withhold an amount up to the employees’ maximum individual tax rate in the relevant jurisdiction without triggering liability classification of the award, while also clarifying that all cash payments made to taxing authorities on employees’ behalf for withheld shares are to be reported as financing activities on the statement of cash flows. The adoption of these changes did not materially impact the Company’s financial position and result of operations. Additionally, as part of this adoption, the Company made an accounting policy election to recognize forfeitures as incurred, rather than estimating the forfeitures in advance. The impact of this change was applied utilizing a modified retrospective approach, with an adjustment of $0.9 million recorded during the three months ended June 30, 2016 to decrease opening retained earnings and increase opening additional paid-in-capital . |
Investments in Unconsolidated29
Investments in Unconsolidated Affiliates (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Investments in Unconsolidated Affiliates | |
Summarized Financial Information of Unconsolidated Affiliates | Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Sales $ $ $ $ Gross profit $ $ $ $ Net income $ $ $ $ |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Inventories | |
Schedule of Inventories | June 30, December 31, 2016 2015 Finished goods $ $ Raw materials and semi-finished goods Supplies Total $ $ |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets | |
Changes in Carrying Amount of Goodwill, by Segment | Performance Materials Synthetic Performance Basic Plastics Latex Rubber Plastics & Feedstocks Total Balance at December 31, 2015 $ $ $ $ $ Divestiture (Note 15) — — — Foreign currency impact Balance at June 30, 2016 $ $ $ $ $ |
Schedule of Other Intangible Assets | June 30, 2016 December 31, 2015 Estimated Gross Gross Useful Life Carrying Accumulated Carrying Accumulated (Years) Amount Amortization Net Amount Amortization Net Developed technology $ $ $ $ $ $ Manufacturing Capacity Rights Software 5 - 10 Software in development N/A — — Other N/A — — Total $ $ $ $ $ $ |
Estimated Amortization Expense for Next Five Years | Estimated Amortization Expense for the Next Five Years Remainder of 2016 $ 2017 2018 2019 2020 2021 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Debt | |
Schedule of Debt | June 30, December 31, 2016 2015 Senior Credit Facility 2020 Revolving Facility $ — $ — 2021 Term Loan B 2022 Senior Notes USD Notes Euro Notes Accounts Receivable Securitization Facility — — Other indebtedness Total debt Less: current portion Less: unamortized deferred financing fees (1) Total long-term debt, net of unamortized deferred financing fees $ $ (1) As discussed in Note 2, effective January 1, 2016, the Company retroactively adopted new accounting guidance that requires deferred financing fees related to a debt liability be presented in the balance sheet as a direct reduction of the carrying value of that debt liability rather than as deferred assets. This caption reflects this reclassification for both the current and prior periods. Note that this caption does not include deferred financing fees related to the 2020 Revolving Facility and the Accounts Receivable Securitization Facility, which are included within “Deferred charges and other assets” on the condensed consolidated balance sheets . |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Derivative Instruments [Abstract] | |
Notional Amounts of Most Significant Net Foreign Exchange Hedge Positions Outstanding | June 30, Buy / (Sell) 2016 Chinese Yuan $ Indonesian Rupiah $ Swiss Franc $ Japanese Yen $ British Pound $ Euro $ |
Schedule of Changes in Fair Value of Company's Derivatives Instruments | Gain (Loss) Recognized in Gain (Loss) Recognized in AOCI on Balance Sheet Statement of Operations Three Months Ended June 30, Statement of Operations 2016 2015 2016 2015 Classification Designated as Cash Flow Hedges Foreign exchange cash flow hedges $ $ $ $ Cost of sales Total $ $ $ $ Net Investment Hedges Euro Notes $ $ $ — $ — Other expenses, net Total $ $ $ — $ — Not Designated as Cash Flow Hedges Foreign exchange forward contracts $ — $ — $ $ Other expenses, net Total $ — $ — $ $ Gain (Loss) Recognized in Gain (Loss) Recognized in AOCI on Balance Sheet Statement of Operations Six Months Ended June 30, Statement of Operations 2016 2015 2016 2015 Classification Designated as Cash Flow Hedges Foreign exchange cash flow hedges $ $ $ $ Cost of sales Total $ $ $ $ Net Investment Hedges Euro Notes $ $ $ — $ — Other expenses, net Total $ $ $ — $ — Not Designated as Cash Flow Hedges Foreign exchange forward contracts $ — $ — $ $ Other expenses, net Total $ — $ — $ $ |
Net Unrealized Gains and Losses Recorded in Consolidated Balance Sheets | June 30, 2016 December 31, 2015 Foreign Exchange Foreign Exchange Foreign Exchange Foreign Exchange Forward Cash Flow Forward Cash Flow Balance Sheet Classification Contracts Hedges Total Contracts Hedges Total Asset Derivatives: Accounts receivable, net of allowance $ $ $ $ $ $ Deferred charges and other assets — — — — Total asset derivatives $ $ $ $ $ $ Liability Derivatives: Accounts payable $ $ $ $ $ — $ Other noncurrent obligations — — — — — — Total liability derivatives $ $ $ $ $ — $ |
Gross Amounts of Derivative Instruments and Amounts Offset | Gross Amounts Gross Amounts Net Amounts Recognized in the Offset in the Presented in the Balance Sheet Balance Sheet Balance Sheet Balance at June 30, 2016 Derivative assets $ $ $ Derivative liabilities Balance at December 31, 2015 Derivative assets $ $ $ Derivative liabilities |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value Measurements | |
Schedule of Assets and Liabilities at Fair Value on Recurring Basis | June 30, 2016 Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Items Inputs Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—Assets $ — $ $ — $ Foreign exchange forward contracts—(Liabilities) — — Foreign exchange cash flow hedges—Assets — — Foreign exchange cash flow hedges—(Liabilities) — — Total fair value $ — $ $ — $ December 31, 2015 Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Items Inputs Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—Assets $ — $ $ — $ Foreign exchange forward contracts—(Liabilities) — — Foreign exchange cash flow hedges—Assets — — Total fair value $ — $ $ — $ |
Estimated Fair Value of Outstanding Debt Not Carried at Fair Value | As of As of June 30, 2016 December 31, 2015 2022 Senior Notes USD Notes Euro Notes 2021 Term Loan B Total fair value $ $ |
Provision for Income Taxes (Tab
Provision for Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Provision for Income Taxes | |
Schedule of Effective Tax Rate | Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Effective income tax rate % % % % |
Pension Plans and Other Postr36
Pension Plans and Other Postretirement Benefits (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Defined Benefit Pension Plans | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Schedule of Net Periodic Benefit Costs | Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Defined Benefit Pension Plans Service cost $ $ $ $ Interest cost Expected return on plan assets Amortization of prior service credit Amortization of net loss Net periodic benefit cost $ $ $ $ |
Other Postretirement Plans | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Schedule of Net Periodic Benefit Costs | Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Other Postretirement Plans Service cost $ $ $ $ Interest cost Amortization of prior service cost Amortization of net gain — — Net periodic benefit cost $ $ $ $ |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Stock-Based Compensation | |
Summary of Weighted Average Assumptions Used for Grants | Six Months Ended June 30, 2016 Expected term (in years) Expected volatility % Risk-free interest rate % Dividend yield % |
Segments (Tables)
Segments (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Segments | |
Reconciliation of Segment Reporting to Consolidated | Performance Materials Synthetic Performance Basic Plastics Corporate Three Months Ended Latex Rubber Plastics & Feedstocks Unallocated Total June 30, 2016 Sales to external customers $ $ $ $ $ — $ Equity in earnings (losses) of unconsolidated affiliates — — — — EBITDA (1) Investment in unconsolidated affiliates — — — — Depreciation and amortization June 30, 2015 Sales to external customers $ $ $ $ $ — $ Equity in earnings (losses) of unconsolidated affiliates — — — — EBITDA (1) Investment in unconsolidated affiliates — — — — Depreciation and amortization Performance Materials Synthetic Performance Basic Plastics Corporate Six Months Ended Latex Rubber Plastics & Feedstocks Unallocated Total June 30, 2016 Sales to external customers $ $ $ $ $ — $ Equity in earnings (losses) of unconsolidated affiliates — — — — EBITDA (1) Investment in unconsolidated affiliates — — — — Depreciation and amortization June 30, 2015 Sales to external customers $ $ $ $ $ — $ Equity in earnings (losses) of unconsolidated affiliates — — — — EBITDA (1) Investment in unconsolidated affiliates — — — — Depreciation and amortization (1) Reconciliation of EBITDA to net income (loss) is as follows: Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 Total segment EBITDA $ $ $ $ Corporate unallocated Less: Interest expense, net Less: Provision for income taxes Less: Depreciation and amortization Net income $ $ $ $ |
Divestitures (Tables)
Divestitures (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Divestitures | |
Schedule of Key Components of Assets Held for Sale | June 30, 2016 Assets Accounts receivable, net of allowance for doubtful accounts $ Inventories Goodwill Deferred charges and other assets Total assets held-for-sale $ Liabilities Accounts payable $ Income taxes payable Accrued expenses and other current liabilities Other non-current obligations Total liabilities held-for-sale $ |
Restructuring (Tables)
Restructuring (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Allyn's Point Plant Shutdown [Member] | |
Rollforward of Liability Balances | Balance at Balance at December 31, 2015 Expenses Deductions (1) June 30, 2016 Employee termination benefit charges $ $ $ $ Other (2) — — Total $ $ $ $ (1) Includes payments made against the existing accrual. (2) Includes decommissioning charges incurred, primarily related to labor and third party service costs. |
Accumulated Other Comprehensi41
Accumulated Other Comprehensive Income (Loss) (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Shareholders' Equity. | |
Components of AOCI, Net of Income Taxes | Currency Pension & Other Foreign Exchange Translation Postretirement Benefit Cash Flow Three Months Ended June 30, 2016 and 2015 Adjustments Plans, Net Hedges, Net Total Balance as of March 31, 2016 $ $ $ $ Other comprehensive income (loss) — Amounts reclassified from AOCI to net income (1) — Balance as of June 30, 2016 $ $ $ $ Balance as of March 31, 2015 $ $ $ $ Other comprehensive income (loss) — Amounts reclassified from AOCI to net income (1) — Balance as of June 30, 2015 $ $ $ $ Currency Pension & Other Foreign Exchange Translation Postretirement Benefit Cash Flow Six Months Ended June 30, 2016 and 2015 Adjustments Plans, Net Hedges, Net Total Balance at December 31, 2015 $ $ $ $ Other comprehensive income (loss) Amounts reclassified from AOCI to net income (1) — Balance at June 30, 2016 $ $ $ $ Balance at December 31, 2014 $ $ $ — $ Other comprehensive income (loss) — Amounts reclassified from AOCI to net income (1) — Balance at June 30, 2015 $ $ $ $ (1) The following is a summary of amounts reclassified from AOCI to net income for the three and six months ended June 30, 2016 and 2015, respectively: |
Reclassification out of Accumulated Other Comprehensive Income [Table Text Block] | Amount Reclassified from AOCI Amount Reclassified from AOCI AOCI Components Three Months Ended June 30, Six Months Ended June 30, Statement of Operations 2016 2015 2016 2015 Classification Cash flow hedging items Foreign exchange cash flow hedges $ $ $ $ Cost of sales Total before tax Tax effect — — Provision for income taxes Total, net of tax $ $ $ $ Amortization of pension and other postretirement benefit plan items Prior service credit $ $ $ $ (a) Net actuarial loss (a) Total before tax Tax effect Provision for income taxes Total, net of tax $ $ $ $ (a) These AOCI components are included in the computation of net periodic benefit costs (see Note 11). |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share | |
Schedule of Earnings per Share Basic and Diluted | Three Months Ended Six Months Ended June 30, June 30, (in thousands, except per share data) 2016 2015 2016 2015 Earnings: Net income $ $ $ $ Shares: Weighted-average ordinary shares outstanding Dilutive effect of RSUs and option awards* Diluted weighted-average ordinary shares outstanding Income per share: Income per share—basic $ $ $ $ Income per share—diluted $ $ $ $ * Refer to Note 12 for discussion of RSUs and option awards granted to certain Company directors and employees. |
Recent Accounting Guidance (Det
Recent Accounting Guidance (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Deferred Charges and Other Miscellaneous Noncurrent Assets | $ 29,168 | $ 27,596 |
Long-term Debt, Excluding Current Maturities | $ 1,183,287 | 1,177,120 |
Accounting Standards Update 2015-03 [Member] | Restatement Adjustment [Member] | ||
Deferred Charges and Other Miscellaneous Noncurrent Assets | (25,700) | |
Long-term Debt, Excluding Current Maturities | $ 25,700 |
Investments in Unconsolidated44
Investments in Unconsolidated Affiliates (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016USD ($)item | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($)item | Jun. 30, 2015USD ($) | Dec. 31, 2015USD ($) | |
Investments in Unconsolidated Affiliates | |||||
Number of strategic joint ventures | item | 2 | 2 | |||
Investments in unconsolidated affiliates | $ 190,314 | $ 200,206 | $ 190,314 | $ 200,206 | $ 182,836 |
Dividends received from investing activities | 4,809 | ||||
Equity in earnings of unconsolidated affiliates | 38,602 | 40,841 | 73,628 | 77,548 | |
Americas Styrenics | |||||
Investments in Unconsolidated Affiliates | |||||
Investments in unconsolidated affiliates | 154,500 | 154,500 | 143,900 | ||
Investment in unconsolidated affiliates-difference between carrying amount and underlying equity | $ 79,700 | $ 79,700 | 91,900 | ||
Percentage of ownership underlying net assets | 50.00% | 50.00% | |||
Amortized weighted average remaining useful life | P4Y3M18D | ||||
Dividends received from operating activities | $ 30,000 | 30,000 | $ 60,000 | 45,000 | |
Sumika Styron Polycarbonate | |||||
Investments in Unconsolidated Affiliates | |||||
Investments in unconsolidated affiliates | 35,800 | 35,800 | 39,000 | ||
Investment in unconsolidated affiliates-difference between carrying amount and underlying equity | $ 16,200 | $ 16,200 | $ 19,800 | ||
Percentage of ownership underlying net assets | 50.00% | 50.00% | |||
Amortized weighted average remaining useful life | P9Y3M18D | ||||
Dividends received from operating and investing activities | $ 0 | $ 0 | $ 6,200 | $ 0 |
Investments in Unconsolidated45
Investments in Unconsolidated Affiliates - Summarized Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Summarized Financial Information, Net Income | ||||
Sales | $ 405,351 | $ 500,803 | $ 781,603 | $ 940,373 |
Gross profit | 87,867 | 91,692 | 156,271 | 169,363 |
Net income | $ 71,015 | $ 74,461 | $ 123,812 | $ 140,481 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Inventories | ||
Finished goods | $ 178,449 | $ 170,380 |
Raw materials and semi-finished goods | 156,396 | 151,444 |
Supplies | 30,294 | 31,273 |
Total | $ 365,139 | $ 353,097 |
Goodwill and Intangible Asset47
Goodwill and Intangible Assets - Goodwill, by Segment (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Goodwill [Roll Forward] | |
Beginning Balance | $ 31,064 |
Divestiture (Note 15) | (418) |
Foreign currency impact | 523 |
Ending Balance | 31,169 |
Latex Segment | |
Goodwill [Roll Forward] | |
Beginning Balance | 12,412 |
Divestiture (Note 15) | (418) |
Foreign currency impact | 209 |
Ending Balance | 12,203 |
Synthetic Rubber Segment | |
Goodwill [Roll Forward] | |
Beginning Balance | 8,501 |
Foreign currency impact | 143 |
Ending Balance | 8,644 |
Performance Plastics Segment [Member] | |
Goodwill [Roll Forward] | |
Beginning Balance | 2,914 |
Foreign currency impact | 49 |
Ending Balance | 2,963 |
Basic Plastics & Feedstocks Segment | |
Goodwill [Roll Forward] | |
Beginning Balance | 7,237 |
Foreign currency impact | 122 |
Ending Balance | $ 7,359 |
Goodwill and Intangible Asset48
Goodwill and Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2015 | |
Other Intangible Assets | ||
Gross Carrying Amount | $ 261,216 | $ 236,470 |
Accumulated Amortization | (89,572) | (78,252) |
Net | $ 171,644 | 158,218 |
Developed Technology [Member] | ||
Other Intangible Assets | ||
Estimated Useful Life (Years) | 15 years | |
Gross Carrying Amount | $ 175,574 | 172,675 |
Accumulated Amortization | (70,067) | (62,870) |
Net | $ 105,507 | 109,805 |
Manufacturing Capacity Rights [Member] | ||
Other Intangible Assets | ||
Estimated Useful Life (Years) | 6 years | |
Gross Carrying Amount | $ 21,100 | 20,750 |
Accumulated Amortization | (7,698) | (5,888) |
Net | 13,402 | 14,862 |
Software [Member] | ||
Other Intangible Assets | ||
Gross Carrying Amount | 49,349 | 18,006 |
Accumulated Amortization | (11,807) | (9,494) |
Net | $ 37,542 | 8,512 |
Software [Member] | Maximum | ||
Other Intangible Assets | ||
Estimated Useful Life (Years) | 10 years | |
Software [Member] | Minimum | ||
Other Intangible Assets | ||
Estimated Useful Life (Years) | 5 years | |
Software in Development [Member] | ||
Other Intangible Assets | ||
Gross Carrying Amount | $ 15,004 | 24,516 |
Net | 15,004 | 24,516 |
Other [Member] | ||
Other Intangible Assets | ||
Gross Carrying Amount | 189 | 523 |
Net | $ 189 | $ 523 |
Goodwill and Intangible Asset49
Goodwill and Intangible Assets - Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Goodwill and Intangible Assets | ||||
Amortization expense related to finite-lived intangible assets | $ 5,800 | $ 4,400 | $ 10,100 | $ 8,900 |
Estimated Amortization Expense, Remainder of 2016 | 11,935 | 11,935 | ||
Estimated Amortization Expense, 2017 | 23,581 | 23,581 | ||
Estimated Amortization Expense, 2018 | 22,890 | 22,890 | ||
Estimated Amortization Expense, 2019 | 22,706 | 22,706 | ||
Estimated Amortization Expense, 2020 | 19,765 | 19,765 | ||
Estimated Amortization Expense, 2021 | $ 14,234 | $ 14,234 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Debt Instruments | ||
Total debt | $ 1,212,176 | $ 1,207,798 |
Less: current portion | (5,000) | (5,000) |
Less: unamortized deferred financing fees | (23,889) | (25,678) |
Total long-term debt, net of unamortized deferred financing fees | 1,183,287 | 1,177,120 |
2021 Term Loan B [Member] | ||
Debt Instruments | ||
Total debt | 493,954 | 496,365 |
USD Notes | ||
Debt Instruments | ||
Total debt | 300,000 | 300,000 |
Euro Notes | ||
Debt Instruments | ||
Total debt | 416,438 | 409,538 |
Accounts Receivable Securitization Facility [Member] | ||
Debt Instruments | ||
Total debt | 0 | 0 |
Other Indebtedness [Member] | ||
Debt Instruments | ||
Total debt | $ 1,784 | $ 1,895 |
Debt - Senior Secured Credit Fa
Debt - Senior Secured Credit Facility (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | May 05, 2015 | May 31, 2015 | Jun. 30, 2016 | Dec. 31, 2015 | Jan. 31, 2013 |
Debt Instruments | ||||||
Unamortized deferred financing fees | $ 23,889 | $ 23,889 | $ 25,678 | |||
Repayment of term loans | 2,500 | |||||
2018 Senior Secured Credit Facility | ||||||
Debt Instruments | ||||||
Maximum borrowing capacity | $ 300,000 | |||||
Write off of Deferred Debt Issuance Cost | $ 700 | |||||
Senior Credit Facility [Member] | ||||||
Debt Instruments | ||||||
Maximum borrowing capacity | $ 825,000 | |||||
2020 Revolving Facility [Member] | ||||||
Debt Instruments | ||||||
Maximum borrowing capacity | 325,000 | |||||
Credit Facility, amount outstanding | $ 0 | 0 | ||||
Commitment fee (as a percent) | 0.375% | |||||
Letters of credit, amount outstanding | $ 16,100 | 16,100 | ||||
Funds available for borrowings | 308,900 | 308,900 | ||||
Swingline Subfacility [Member] | ||||||
Debt Instruments | ||||||
Maximum borrowing capacity | 25,000 | |||||
Letter of Credit [Member] | ||||||
Debt Instruments | ||||||
Maximum borrowing capacity | 35,000 | |||||
2021 Term Loan B [Member] | ||||||
Debt Instruments | ||||||
Maximum borrowing capacity | $ 500,000 | |||||
Debt Instrument Discount Rate (as a percent) | 0.25% | |||||
Debt Instrument Periodic Payment as Percent of Original Principal Amount | 0.25% | |||||
Current portion | $ 5,000 | $ 5,000 | ||||
LIBOR [Member] | 2021 Term Loan B [Member] | ||||||
Debt Instruments | ||||||
Debt instrument, margin rate | 3.25% | |||||
Variable rate floor (as a percent) | 1.00% |
Debt - Senior Notes (Details)
Debt - Senior Notes (Details) | May 13, 2015USD ($) | Jul. 31, 2014USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2015USD ($) | May 05, 2015EUR (€) | May 05, 2015USD ($) | Jan. 31, 2013USD ($) |
Debt Instruments | |||||||
Redemption of Senior Notes | $ 1,192,500,000 | ||||||
Call premium | 68,603,000 | ||||||
Loss on extinguishment of debt | $ 95,150,000 | 95,150,000 | |||||
2019 Senior Notes | |||||||
Debt Instruments | |||||||
Debt instrument issued | $ 1,325,000,000 | ||||||
Debt instrument, stated interest rate | 8.75% | ||||||
Redemption of Senior Notes | $ 1,192,500,000 | $ 132,500,000 | |||||
Call premium | $ 68,600,000 | 68,600,000 | 68,600,000 | ||||
Debt instrument, redemption price percentage | 103.00% | ||||||
Debt Instrument Redemption Price Percentage for Balance Above Threshold | 106.097% | ||||||
Accrued and unpaid interest | $ 29,600,000 | ||||||
Loss on extinguishment of debt | 94,500,000 | 94,500,000 | |||||
Write off of Deferred Debt Issuance Cost | $ 25,900,000 | $ 25,900,000 | |||||
Euro Notes | |||||||
Debt Instruments | |||||||
Debt instrument issued | € | € 375,000,000 | ||||||
Debt instrument, stated interest rate | 6.375% | 6.375% | |||||
USD Notes | |||||||
Debt Instruments | |||||||
Debt instrument issued | $ 300,000,000 | ||||||
Debt instrument, stated interest rate | 6.75% | 6.75% |
Debt - Accounts Receivable Secu
Debt - Accounts Receivable Securitization Facility and Other (Details) - Accounts Receivable Securitization Facility [Member] - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2015 | |
Debt Instruments | ||
Maximum borrowing capacity | $ 200 | |
Debt instrument, margin rate | 2.60% | |
Fixed interest charges on available, but undrawn borrowings | 1.40% | |
Amounts outstanding | $ 0 | $ 0 |
Accounts receivable available to support facility | $ 129.7 | $ 123.4 |
Derivative Instruments (Details
Derivative Instruments (Details) $ in Thousands, € in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2016EUR (€) | Jun. 30, 2016USD ($) | |
Information regarding changes in fair value of derivatives | ||||||
Foreign exchange transaction gains (losses) | $ 2,300 | $ (10,400) | $ (2,600) | $ 7,600 | ||
Foreign Exchange Cash Flow Hedges | ||||||
Derivative Instruments | ||||||
Original maturity | 18 months | |||||
Information regarding changes in fair value of derivatives | ||||||
Foreign Currency Cash Flow Hedge Gain (Loss) to be Reclassified During Next 12 Months | $ 2,300 | |||||
Net Investment Hedge | ||||||
Derivative Instruments | ||||||
Cumulative foreign currency translation gain | $ (2,100) | |||||
Information regarding changes in fair value of derivatives | ||||||
Gain (Loss) Recognized in AOCI on Balance Sheet | 3,798 | (2,438) | (2,487) | (2,438) | ||
Not Designated as Hedging Instruments [Member] | ||||||
Information regarding changes in fair value of derivatives | ||||||
Gain (Loss) Recognized in Statement of Operations | (2,138) | 7,264 | 995 | (13,698) | ||
Designated as Hedging Instrument [Member] | ||||||
Information regarding changes in fair value of derivatives | ||||||
Gain (Loss) Recognized in AOCI on Balance Sheet | 6,029 | (1,440) | (1,396) | (405) | ||
Gain (Loss) Recognized in Statement of Operations | (735) | 76 | 370 | 76 | ||
Designated as Hedging Instrument [Member] | Foreign Exchange Cash Flow Hedges | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | 270,000 | |||||
Foreign Exchange Forward Contracts | ||||||
Information regarding changes in fair value of derivatives | ||||||
Gain (loss) from settlements | (2,100) | 7,300 | 1,000 | (13,700) | ||
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments [Member] | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | 155,200 | |||||
Cost of Sales | Designated as Hedging Instrument [Member] | Foreign Exchange Cash Flow Hedges | ||||||
Information regarding changes in fair value of derivatives | ||||||
Gain (Loss) Recognized in AOCI on Balance Sheet | 6,029 | (1,440) | (1,396) | (405) | ||
Gain (Loss) Recognized in Statement of Operations | (735) | 76 | 370 | 76 | ||
Other (Expense) Income, Net | Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments [Member] | ||||||
Information regarding changes in fair value of derivatives | ||||||
Gain (Loss) Recognized in Statement of Operations | (2,138) | 7,264 | 995 | (13,698) | ||
Other (Expense) Income, Net | Euro Notes | Net Investment Hedge | ||||||
Information regarding changes in fair value of derivatives | ||||||
Gain (Loss) Recognized in AOCI on Balance Sheet | $ 3,798 | $ (2,438) | $ (2,487) | $ (2,438) | ||
Euro Notes | ||||||
Derivative Instruments | ||||||
Total debt | € | € 375 | |||||
Euro Notes | Net Investment Hedge | ||||||
Derivative Instruments | ||||||
Total debt | € | € 280 | |||||
Chinese Yuan [Member] | Foreign Exchange Forward Contracts | Sell | Not Designated as Hedging Instruments [Member] | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | 56,386 | |||||
Indonesian Rupiah [Member] | Foreign Exchange Forward Contracts | Sell | Not Designated as Hedging Instruments [Member] | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | 30,436 | |||||
Swiss Franc [Member] | Foreign Exchange Forward Contracts | Buy | Not Designated as Hedging Instruments [Member] | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | 24,283 | |||||
Japanese Yen [Member] | Foreign Exchange Forward Contracts | Sell | Not Designated as Hedging Instruments [Member] | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | 10,346 | |||||
British Pound [Member] | Foreign Exchange Forward Contracts | Sell | Not Designated as Hedging Instruments [Member] | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | 9,332 | |||||
Euro [Member] | Foreign Exchange Forward Contracts | Sell | Not Designated as Hedging Instruments [Member] | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | $ 6,064 |
Derivative Instruments - Financ
Derivative Instruments - Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Derivatives, Financial Assets and Liabilities | ||
Net Amounts of Assets Presented in the Consolidated Balance Sheet | $ 5,018 | $ 9,550 |
Net Amounts of Liabilities Presented in the Consolidated Balance Sheet | 1,163 | 194 |
Accounts Receivable | ||
Derivatives, Financial Assets and Liabilities | ||
Net Amounts of Assets Presented in the Consolidated Balance Sheet | 3,881 | 9,550 |
Deferred Charges and Other Assets | ||
Derivatives, Financial Assets and Liabilities | ||
Net Amounts of Assets Presented in the Consolidated Balance Sheet | 1,137 | |
Accounts Payable | ||
Derivatives, Financial Assets and Liabilities | ||
Net Amounts of Liabilities Presented in the Consolidated Balance Sheet | 1,163 | 194 |
Designated as Hedging Instrument [Member] | Foreign Exchange Cash Flow Hedges | ||
Derivatives, Financial Assets and Liabilities | ||
Net Amounts of Assets Presented in the Consolidated Balance Sheet | 3,586 | 4,958 |
Net Amounts of Liabilities Presented in the Consolidated Balance Sheet | 164 | |
Designated as Hedging Instrument [Member] | Foreign Exchange Cash Flow Hedges | Accounts Receivable | ||
Derivatives, Financial Assets and Liabilities | ||
Net Amounts of Assets Presented in the Consolidated Balance Sheet | 2,449 | 4,958 |
Designated as Hedging Instrument [Member] | Foreign Exchange Cash Flow Hedges | Deferred Charges and Other Assets | ||
Derivatives, Financial Assets and Liabilities | ||
Net Amounts of Assets Presented in the Consolidated Balance Sheet | 1,137 | |
Designated as Hedging Instrument [Member] | Foreign Exchange Cash Flow Hedges | Accounts Payable | ||
Derivatives, Financial Assets and Liabilities | ||
Net Amounts of Liabilities Presented in the Consolidated Balance Sheet | 164 | |
Foreign Exchange Forward Contracts | ||
Derivatives, Financial Assets and Liabilities | ||
Gross Amounts of Recognized Assets | 6,816 | 10,044 |
Gross Amounts of Offset in the Consolidated Balance Sheet | (1,798) | (494) |
Net Amounts of Assets Presented in the Consolidated Balance Sheet | 5,018 | 9,550 |
Gross Amounts of Recognized Liabilities | 2,961 | 688 |
Gross Amounts of Offset in the Consolidated Balance Sheet | (1,798) | (494) |
Net Amounts of Liabilities Presented in the Consolidated Balance Sheet | 1,163 | 194 |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments [Member] | ||
Derivatives, Financial Assets and Liabilities | ||
Net Amounts of Assets Presented in the Consolidated Balance Sheet | 1,432 | 4,592 |
Net Amounts of Liabilities Presented in the Consolidated Balance Sheet | 999 | 194 |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments [Member] | Accounts Receivable | ||
Derivatives, Financial Assets and Liabilities | ||
Net Amounts of Assets Presented in the Consolidated Balance Sheet | 1,432 | 4,592 |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments [Member] | Accounts Payable | ||
Derivatives, Financial Assets and Liabilities | ||
Net Amounts of Liabilities Presented in the Consolidated Balance Sheet | $ 999 | $ 194 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities at Fair Value, Recurring (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Fair Value Measurements | ||
Assets at fair value | $ 5,018 | $ 9,550 |
Liabilities at fair value | (1,163) | (194) |
Recurring | ||
Fair Value Measurements | ||
Total fair value | 3,855 | 9,356 |
Recurring | Foreign Exchange Forward Contracts | ||
Fair Value Measurements | ||
Assets at fair value | 1,432 | 4,592 |
Liabilities at fair value | (999) | (194) |
Recurring | Significant Other Observable Inputs (Level 2) | ||
Fair Value Measurements | ||
Total fair value | 3,855 | 9,356 |
Recurring | Significant Other Observable Inputs (Level 2) | Foreign Exchange Forward Contracts | ||
Fair Value Measurements | ||
Assets at fair value | 1,432 | 4,592 |
Liabilities at fair value | (999) | (194) |
Recurring | Foreign Exchange Cash Flow Hedges | ||
Fair Value Measurements | ||
Assets at fair value | 3,586 | 4,958 |
Liabilities at fair value | (164) | |
Recurring | Foreign Exchange Cash Flow Hedges | Significant Other Observable Inputs (Level 2) | ||
Fair Value Measurements | ||
Assets at fair value | 3,586 | $ 4,958 |
Liabilities at fair value | $ (164) |
Fair Value Measurements - Items
Fair Value Measurements - Items not at Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Fair Value of Debt Instruments | ||
Total fair value of long term debt | $ 1,215,870 | $ 1,197,705 |
USD Notes | Significant Other Observable Inputs (Level 2) | ||
Fair Value of Debt Instruments | ||
Total fair value of long term debt | 301,500 | 296,250 |
Euro Notes | Significant Other Observable Inputs (Level 2) | ||
Fair Value of Debt Instruments | ||
Total fair value of long term debt | 420,914 | 410,054 |
2021 Term Loan B [Member] | Significant Other Observable Inputs (Level 2) | ||
Fair Value of Debt Instruments | ||
Total fair value of long term debt | $ 493,456 | $ 491,401 |
Provision for Income Taxes (Det
Provision for Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Provision for Income Taxes | ||||
Effective tax rate | 23.00% | 90.90% | 22.60% | 39.80% |
Provision for income taxes | $ 28,600 | $ 7,500 | $ 50,500 | $ 25,400 |
Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Brazil Latex and Automotive Businesses [Member] | ||||
Provision for Income Taxes | ||||
Portion of loss related to impairment | 12,900 | |||
Luxembourg | ||||
Provision for Income Taxes | ||||
Income (loss) from continuing operations in holding companies | $ (29,000) | (41,200) | $ (41,700) | (58,800) |
Call premium fees, portion with no tax benefit | 18,100 | 18,100 | ||
Write-off of deferred financing fees, portion with no tax benefit | $ 4,300 | $ 4,300 |
Commitments and Contingencies -
Commitments and Contingencies - Operating Leases, Environmental Matters (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2015 | |
Commitments and Contingencies Disclosure | ||
Accrued obligations for environmental remediation and restoration costs | $ 0 | $ 0 |
Environmental remediation costs | $ 0 |
Commitments and Contingencies60
Commitments and Contingencies - Purchase Commitments (Details) | 6 Months Ended |
Jun. 30, 2016 | |
Maximum | |
Purchase commitment period | 5 years |
Minimum | |
Purchase commitment period | 1 year |
Pension Plans and Other Postr61
Pension Plans and Other Postretirement Benefits - Net Periodic Benefit Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Defined Benefit Pension Plans | ||||
Net periodic benefit cost | ||||
Service cost | $ 4,211 | $ 4,075 | $ 8,282 | $ 8,376 |
Interest cost | 1,408 | 1,287 | 2,768 | 2,647 |
Expected return on plan assets | (499) | (399) | (982) | (820) |
Amortization of prior service cost (credit) | (493) | (402) | (971) | (825) |
Amortization of net (gain) loss | 1,073 | 1,308 | 2,111 | 2,689 |
Defined Benefit Pension Plans | Cost of Sales and Selling, General and Administrative Expenses | ||||
Net periodic benefit cost | ||||
Net periodic benefit cost (income) | 5,700 | 5,869 | 11,208 | 12,067 |
Amounts recognized in other comprehensive income (loss) | ||||
Net periodic benefit cost (income) | 5,700 | 5,869 | 11,208 | 12,067 |
Other Postretirement Plans | ||||
Net periodic benefit cost | ||||
Service cost | 65 | 86 | 128 | 174 |
Interest cost | 129 | 133 | 250 | 273 |
Amortization of prior service cost (credit) | 26 | 26 | 52 | 52 |
Amortization of net (gain) loss | (43) | (86) | ||
Other Postretirement Plans | Cost of Sales and Selling, General and Administrative Expenses | ||||
Net periodic benefit cost | ||||
Net periodic benefit cost (income) | 177 | 245 | 344 | 499 |
Amounts recognized in other comprehensive income (loss) | ||||
Net periodic benefit cost (income) | $ 177 | $ 245 | $ 344 | $ 499 |
Pension Plans and Other Postr62
Pension Plans and Other Postretirement Benefits - Net Amounts Recognized (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | |
Net amounts recognized in the balance sheets at December 31 | |||
Employer contributions | $ 2,400 | $ 5,300 | |
Additional cash contributions, including benefit payments to unfunded plans | 11,000 | ||
Recognition of net losses for transfer of pension plan resulting from an acquisition | 800 | ||
Other Noncurrent Obligations | |||
Net amounts recognized in the balance sheets at December 31 | |||
Benefit obligations | $ 181,300 | $ 181,300 | $ 172,500 |
Pension Plans and Other Postr63
Pension Plans and Other Postretirement Benefits - Supplemental and Defined Contribution (Details) - Supplemental Employee Retirement Plan [Member] - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Supplemental Employee Retirement Plan | ||
Benefit obligations | $ 13.7 | |
Amounts of net loss included in AOCI | 1.6 | |
Net loss to be amortized | $ 1 | 1 |
Estimated future benefit payments | $ 13.9 | |
Defined Benefit Plan, Plan Amendments | $ 1.3 |
Pension Plans and Other Postr64
Pension Plans and Other Postretirement Benefits - Future Benefits, Contribution (Detail) - Supplemental Employee Retirement Plan [Member] - USD ($) $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 |
Defined Benefit Plan Disclosure [Line Items] | ||
2,018 | $ 15.3 | |
Total | $ 13.9 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Awards (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 17, 2010 | |
Restricted Stock [Member] | Parent [Member] | |||||
Stock-based Compensation | |||||
Number of shares authorized | 750,000 | ||||
Time-based Restricted Stock Awards [Member] | |||||
Stock-based Compensation | |||||
Compensation expense | $ 0.4 | $ 0.9 | $ 0.8 | $ 2.1 | |
Unrecognized compensation cost | 0.8 | $ 0.8 | |||
Weighted-average period of recognition | 1 year 3 months 18 days | ||||
Time-based Restricted Stock Awards [Member] | Parent [Member] | |||||
Other-than-Options, Shares Activity | |||||
Granted, Shares | 0 | ||||
Modified Time-based Restricted Stock Awards [Member] | |||||
Stock-based Compensation | |||||
Compensation expense | 0.7 | $ 0.9 | $ 1.5 | $ 1.8 | |
Unrecognized compensation cost | $ 3 | $ 3 | |||
Weighted-average period of recognition | 1 year 1 month 6 days | ||||
Modified Time-based Restricted Stock Awards [Member] | Parent [Member] | |||||
Other-than-Options, Shares Activity | |||||
Granted, Shares | 0 |
Stock-Based Compensation - 2014
Stock-Based Compensation - 2014 Omnibus Plan (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016USD ($)$ / sharesshares | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($)item$ / sharesshares | Jun. 30, 2015USD ($) | May 28, 2014shares | |
2014 Omnibus Incentive Plan [Member] | |||||
Stock-based Compensation | |||||
Number of shares authorized | shares | 4,500,000 | ||||
Restricted Stock Units - under 2014 Omnibus Plan | 2014 Omnibus Incentive Plan [Member] | |||||
Stock-based Compensation | |||||
Compensation expense | $ 1,400 | $ 500 | $ 2,500 | $ 700 | |
Unrecognized compensation cost | $ 12,400 | $ 12,400 | |||
Weighted-average period of recognition | 2 years 3 months 18 days | ||||
Other-than-Options, Shares Activity | |||||
Granted, Shares | shares | 21,446 | 340,551 | |||
Other-than-Options, FV Activity | |||||
Granted, Weighted-Average Grant Date Fair Value per Share | $ / shares | $ 47.45 | $ 28.26 | |||
Option Award [Member] | |||||
Stock-based Compensation | |||||
Weighted-average period of recognition | 1 year 4 months 24 days | ||||
Fair Value Assumptions | |||||
Dividend yield | 0.60% | ||||
Expected volatility | 40.00% | ||||
Risk-free interest rate | 1.42% | ||||
Expected term (in years) | 5 years 6 months | ||||
Unrecognized compensation cost, options | $ 2,800 | $ 2,800 | |||
Option Award [Member] | 2014 Omnibus Incentive Plan [Member] | |||||
Stock-based Compensation | |||||
Compensation expense | $ 800 | $ 1,200 | $ 4,100 | $ 1,400 | |
Other-than-Options, FV Activity | |||||
Exercise term (in years) | 9 years | ||||
Number of vesting installments | item | 3 | ||||
Options, Shares Activity | |||||
Granted, Options | shares | 27,404 | 568,981 | |||
Options, FV Activity | |||||
Granted, Weighted-Average Grant Date Fair Value per Share | $ / shares | $ 14.16 | $ 10.10 |
Related Party Transactions (Det
Related Party Transactions (Details) - Bain Capital [Member] - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
May 31, 2016 | Mar. 31, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Related Party Transactions | ||||||
Entity Shares Sold By Related Party | 8,000,000 | 10,600,000 | ||||
Advisory Agreement [Member] | ||||||
Related Party Transactions | ||||||
Related party agreement term (in years) | 10 years | |||||
Expenses from transactions | $ 0 | $ 0.1 | $ 0 | $ 0.2 | ||
Selling, General and Administrative Expenses | Other Agreements [Member] | ||||||
Related Party Transactions | ||||||
Expenses from transactions | $ 0.3 | $ 2.2 |
Segments - Reconciliation of Se
Segments - Reconciliation of Segment Reporting to Consolidated (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016USD ($)item | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($)divisionitem | Jun. 30, 2015USD ($) | Dec. 31, 2015USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of divisions | division | 2 | ||||
Number of strategic joint ventures | item | 2 | 2 | |||
Sales to external customers | $ 969,694 | $ 1,028,673 | $ 1,863,778 | $ 2,046,938 | |
Equity in earnings (losses) of unconsolidated affiliates | 38,602 | 40,841 | 73,628 | 77,548 | |
Investment in unconsolidated affiliates | 190,314 | 200,206 | 190,314 | 200,206 | $ 182,836 |
Depreciation and amortization | $ 24,853 | 21,727 | $ 47,973 | 44,281 | |
Americas Styrenics | |||||
Segment Reporting Information [Line Items] | |||||
Percentage of ownership underlying net assets | 50.00% | 50.00% | |||
Investment in unconsolidated affiliates | $ 154,500 | $ 154,500 | 143,900 | ||
Sumika Styron Polycarbonate | |||||
Segment Reporting Information [Line Items] | |||||
Percentage of ownership underlying net assets | 50.00% | 50.00% | |||
Investment in unconsolidated affiliates | $ 35,800 | $ 35,800 | $ 39,000 | ||
Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
EBITDA | 190,425 | 176,776 | 358,204 | 308,473 | |
Corporate Unallocated [Member] | |||||
Segment Reporting Information [Line Items] | |||||
EBITDA | 22,354 | 121,193 | 49,470 | 145,876 | |
Depreciation and amortization | 1,790 | 765 | 2,593 | 1,516 | |
Latex Segment | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales to external customers | 232,471 | 247,512 | 441,952 | 485,768 | |
EBITDA | 16,929 | 14,904 | 35,033 | 36,352 | |
Depreciation and amortization | 5,881 | 6,196 | 12,161 | 12,566 | |
Synthetic Rubber Segment | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales to external customers | 111,391 | 115,370 | 213,588 | 244,774 | |
EBITDA | 30,216 | 18,461 | 53,295 | 44,632 | |
Depreciation and amortization | 8,892 | 7,378 | 16,935 | 15,169 | |
Performance Plastics Segment [Member] | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales to external customers | 183,891 | 185,304 | 352,520 | 382,249 | |
EBITDA | 22,273 | 21,256 | 52,265 | 46,344 | |
Depreciation and amortization | 1,589 | 1,373 | 3,133 | 2,786 | |
Basic Plastics & Feedstocks Segment | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales to external customers | 441,941 | 480,487 | 855,718 | 934,147 | |
Equity in earnings (losses) of unconsolidated affiliates | 38,602 | 40,841 | 73,628 | 77,548 | |
EBITDA | 121,007 | 122,155 | 217,611 | 181,145 | |
Investment in unconsolidated affiliates | 190,314 | 200,206 | 190,314 | 200,206 | |
Depreciation and amortization | $ 6,701 | $ 6,015 | $ 13,151 | $ 12,244 |
Segments - Recon. of EBITDA to
Segments - Recon. of EBITDA to Net Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Less: Interest expense, net | $ 18,814 | $ 25,600 | $ 37,710 | $ 54,456 |
Less Provision for income taxes | 28,600 | 7,500 | 50,500 | 25,400 |
Less Depreciation and amortization | 24,853 | 21,727 | 47,973 | 44,281 |
Net income (loss) | 95,804 | 756 | 172,551 | 38,460 |
Operating Segments [Member] | ||||
EBITDA | 190,425 | 176,776 | 358,204 | 308,473 |
Corporate Unallocated [Member] | ||||
EBITDA | 22,354 | 121,193 | 49,470 | 145,876 |
Less Depreciation and amortization | $ 1,790 | $ 765 | $ 2,593 | $ 1,516 |
Divestitures (Details)
Divestitures (Details) $ in Thousands, € in Millions | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2016 | Jun. 30, 2016USD ($) | Jun. 30, 2015EUR (€) | Jun. 30, 2015USD ($) | |
Disposal Group, Including Discontinued Operation, Balance Sheet Disclosures [Abstract] | ||||
Loss on sale | $ 12,915 | |||
Brazil Latex and Automotive Businesses [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | ||||
Disclosures by disposal group | ||||
Portion of loss related to impairment | 12,900 | |||
Brazil Latex and Automotive Businesses [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Other Current Assets [Member] | ||||
Disposal Group, Including Discontinued Operation, Balance Sheet Disclosures [Abstract] | ||||
Accounts receivable, net of allowance for doubtful accounts | 7,311 | |||
Inventories | 5,237 | |||
Other assets, net | 26 | |||
Goodwill | 418 | |||
Total assets sold | 12,992 | |||
Brazil Latex and Automotive Businesses [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Accrued Expenses And Other Current Liabilities | ||||
Disposal Group, Including Discontinued Operation, Balance Sheet Disclosures [Abstract] | ||||
Accounts payable | 4,765 | |||
Income taxes payable | 288 | |||
Accrued expenses and other current liabilities | 2,005 | |||
Other non-current obligations | 2,662 | |||
Total liabilities sold | 9,720 | |||
Brazil Latex and Automotive Businesses [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Other (Expense) Income, Net | ||||
Disclosures by disposal group | ||||
Portion of loss related to impairment | 12,900 | |||
Brazil Latex and Automotive Businesses [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Scenario, Forecast [Member] | ||||
Disclosures by disposal group | ||||
Period subsequent to closing contingent consideration payments may be made by buyer | 5 years | |||
Expandable Polystyrene Business [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | ||||
Disposal Group, Including Discontinued Operation, Balance Sheet Disclosures [Abstract] | ||||
Incremental payment | € 0.5 | $ 600 | ||
Latex Segment | Brazil Latex and Automotive Businesses [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Other (Expense) Income, Net | ||||
Disclosures by disposal group | ||||
Portion of loss related to impairment | 4,000 | |||
Performance Plastics Segment [Member] | Brazil Latex and Automotive Businesses [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Other (Expense) Income, Net | ||||
Disclosures by disposal group | ||||
Portion of loss related to impairment | 8,600 | |||
Corporate Unallocated [Member] | Brazil Latex and Automotive Businesses [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Other (Expense) Income, Net | ||||
Disclosures by disposal group | ||||
Portion of loss related to impairment | $ 300 |
Restructing (Details)
Restructing (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Allyn's Point Plant Shutdown [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Payments of restructuring charges | $ 974 | ||||
Employee Termination Benefit Charges | Allyn's Point Plant Shutdown [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Payments of restructuring charges | 135 | ||||
Other | Allyn's Point Plant Shutdown [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Payments of restructuring charges | 839 | ||||
Selling, General and Administrative Expenses | Latex Segment | Allyn's Point Plant Shutdown [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | $ 0 | 1,202 | $ 0 | ||
Selling, General and Administrative Expenses | Latex Segment | Accelerated Depreciation On Related Assets [Member] | Allyn's Point Plant Shutdown [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | $ 0 | 500 | |||
Selling, General and Administrative Expenses | Latex Segment | Employee Termination Benefit Charges | Allyn's Point Plant Shutdown [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 363 | ||||
Selling, General and Administrative Expenses | Latex Segment | Employee Termination Benefits [Member] | Allyn's Point Plant Shutdown [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 500 | 1,200 | |||
Selling, General and Administrative Expenses | Latex Segment | Other | Allyn's Point Plant Shutdown [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 839 | ||||
Dow [Member] | Basic Plastics & Feedstocks Segment | Restructuring in Polycarbonate [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Accrued charges | $ 0 | ||||
Dow [Member] | Selling, General and Administrative Expenses | Basic Plastics & Feedstocks Segment | Other | Restructuring in Polycarbonate [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | $ 0 | $ 500 | |||
Brazil Latex and Automotive Businesses [Member] | Selling, General and Administrative Expenses | Employee Termination Benefit Charges | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | $ 600 | 600 | |||
Payments of restructuring charges | $ 0 |
Restructuring - Rollforward of
Restructuring - Rollforward of Liability Balances (Details) - Allyn's Point Plant Shutdown [Member] - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Restructuring Reserve [Roll Forward] | |||
Deductions | $ (974) | ||
Accrued Expenses And Other Current Liabilities | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | 434 | ||
Balance at end of period | 662 | ||
Selling, General and Administrative Expenses | Latex Segment | |||
Restructuring Reserve [Roll Forward] | |||
Expenses | $ 0 | 1,202 | $ 0 |
Employee Termination Benefit Charges | |||
Restructuring Reserve [Roll Forward] | |||
Deductions | (135) | ||
Employee Termination Benefit Charges | Accrued Expenses And Other Current Liabilities | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | 434 | ||
Balance at end of period | 662 | ||
Employee Termination Benefit Charges | Selling, General and Administrative Expenses | Latex Segment | |||
Restructuring Reserve [Roll Forward] | |||
Expenses | 363 | ||
Other | |||
Restructuring Reserve [Roll Forward] | |||
Deductions | (839) | ||
Other | Selling, General and Administrative Expenses | Latex Segment | |||
Restructuring Reserve [Roll Forward] | |||
Expenses | $ 839 |
Accumulated Other Comprehensi73
Accumulated Other Comprehensive Income (Loss) - Components (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Balance | $ 389,014 | $ 320,865 | ||
Balance | $ 463,413 | $ 287,853 | 463,413 | 287,853 |
Currency Translation Adjustment | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Balance | (95,697) | (131,910) | (109,120) | (17,755) |
Other comprehensive income (loss) | (11,005) | 35,241 | 2,418 | (78,914) |
Balance | (106,702) | (96,669) | (106,702) | (96,669) |
Pension & Other Postretirement Benefit Plans, Net | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Balance | (46,426) | (56,625) | (46,166) | (57,462) |
Other comprehensive income (loss) | (800) | |||
Amounts reclassified from AOCI to net income | 539 | 791 | 1,079 | 1,628 |
Balance | (45,887) | (55,834) | (45,887) | (55,834) |
Foreign Exchange Cash Flow Hedges, Net | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Balance | (1,856) | 1,035 | 5,569 | |
Other comprehensive income (loss) | 5,294 | (1,370) | (1,026) | (335) |
Amounts reclassified from AOCI to net income | 735 | (70) | (370) | (70) |
Balance | 4,173 | (405) | 4,173 | (405) |
Accumulated Other Comprehensive Income (Loss) [Member] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Balance | (143,979) | (187,500) | (149,717) | (75,217) |
Other comprehensive income (loss) | (5,711) | 33,871 | 592 | (79,249) |
Amounts reclassified from AOCI to net income | 1,274 | 721 | 709 | 1,558 |
Balance | $ (148,416) | $ (152,908) | $ (148,416) | $ (152,908) |
Accumulated Other Comprehensi74
Accumulated Other Comprehensive Income (Loss) - Reclassification (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Income (loss) before income taxes | $ 124,404 | $ 8,256 | $ 223,051 | $ 63,860 |
Tax effect | (28,600) | (7,500) | (50,500) | (25,400) |
Net income (loss) | 95,804 | 756 | 172,551 | 38,460 |
Currency Translation Adjustment | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Cost of Sales | 735 | (76) | ||
Currency Translation Adjustment | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Cost of Sales | (370) | (76) | ||
Pension & Other Postretirement Benefit Plans, Net | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Income (loss) before income taxes | 798 | 1,136 | ||
Tax effect | (259) | (345) | ||
Net income (loss) | 539 | 791 | ||
Pension & Other Postretirement Benefit Plans, Net | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Income (loss) before income taxes | 1,599 | 2,324 | ||
Tax effect | (520) | (696) | ||
Net income (loss) | 1,079 | 1,628 | ||
Accumulated Defined Benefit Plans Adjustment, Net Prior Service Attributable to Parent [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Prior service credit | (467) | (376) | ||
Accumulated Defined Benefit Plans Adjustment, Net Prior Service Attributable to Parent [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Prior service credit | (920) | (773) | ||
Accumulated Defined Benefit Plans Adjustment, Net Gain (Loss) Attributable to Parent [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Net actuarial loss | 1,265 | 1,512 | ||
Accumulated Defined Benefit Plans Adjustment, Net Gain (Loss) Attributable to Parent [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Net actuarial loss | 2,519 | 3,097 | ||
Foreign Exchange Cash Flow Hedges, Net | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Income (loss) before income taxes | 735 | (76) | ||
Tax effect | 6 | |||
Net income (loss) | $ 735 | $ (70) | ||
Foreign Exchange Cash Flow Hedges, Net | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Income (loss) before income taxes | (370) | (76) | ||
Tax effect | 6 | |||
Net income (loss) | $ (370) | $ (70) |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | May 31, 2016 | Apr. 25, 2016 | Mar. 31, 2016 | Jun. 30, 2016 | Jun. 30, 2016 | |
Basis of Presentation | ||||||
Ordinary shares issued | 0 | 0 | ||||
Treasury Stock, Shares, Acquired | 38,702 | 1,600,000 | 752,437 | |||
Payments for Repurchase of Common Stock | $ 1,400 | $ 57,000 | $ 36,000 | $ 94,362 | ||
Repurchase authorization, number of shares. | 1,165,000 | |||||
Repayment of equity per share | $ 0.30 | $ 0.30 | $ 0.30 | |||
Accrued Expenses And Other Current Liabilities | ||||||
Basis of Presentation | ||||||
Repayment of equity payable | $ 13,900 | $ 13,900 | $ 13,900 | |||
Bain Capital [Member] | ||||||
Basis of Presentation | ||||||
Entity Shares Sold By Related Party | 8,000,000 | 10,600,000 | ||||
Share Price | $ 42.90 | $ 35.63 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Earnings: | ||||
Net income | $ 95,804 | $ 756 | $ 172,551 | $ 38,460 |
Shares: | ||||
Weighted average ordinary shares- basic | 46,952 | 48,771 | 47,803 | 48,770 |
Dilutive effect of restricted stock units | 905 | 136 | 751 | 126 |
Diluted weighted average ordinary shares outstanding | 47,857 | 48,907 | 48,554 | 48,896 |
Income (loss) per share: | ||||
Income per share- basic | $ 2.04 | $ 0.02 | $ 3.61 | $ 0.79 |
Income per share- diluted | $ 2 | $ 0.02 | $ 3.55 | $ 0.79 |
Parent [Member] | ||||
Earnings: | ||||
Net income | $ 95,804 | $ 756 | $ 172,551 | $ 38,460 |