Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | Apr. 29, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-36473 | |
Entity Registrant Name | Trinseo PLC | |
Entity Incorporation, State or Country Code | L2 | |
Entity Tax Identification Number | 00-0000000 | |
Entity Address, Address Line One | 1000 Chesterbrook Boulevard | |
Entity Address, Address Line Two | Suite 300 | |
Entity Address, Address Line Three | Berwyn | |
Entity Address, City or Town | Berwyn, PA 19312 | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 19312 | |
City Area Code | 610 | |
Local Phone Number | 240-3200 | |
Title of 12(b) Security | Ordinary Shares, par value $0.01 per share | |
Trading Symbol | TSE | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 36,151,314 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001519061 | |
Current Fiscal Year End Date | --12-31 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 448.7 | $ 573 |
Accounts receivable, net of allowance | 814.3 | 740.2 |
Inventories | 682 | 621 |
Other current assets | 41.4 | 44.3 |
Total current assets | 1,986.4 | 1,978.5 |
Investments in unconsolidated affiliates | 262 | 247.8 |
Property, plant and equipment, net | 692.7 | 719 |
Other assets | ||
Goodwill | 727.4 | 710.1 |
Other intangible assets, net | 814.5 | 823.8 |
Right-of-use assets - operating, net | 81.4 | 85.3 |
Deferred income tax assets | 73.3 | 77.6 |
Deferred charges and other assets | 62.4 | 70.1 |
Total other assets | 1,759 | 1,766.9 |
Total assets | 4,700.1 | 4,712.2 |
Current liabilities | ||
Short-term borrowings and current portion of long-term debt | 18.2 | 18.5 |
Accounts payable | 600.8 | 590.3 |
Current lease liabilities - operating | 18.3 | 18.4 |
Income taxes payable | 57.4 | 52.1 |
Accrued expenses and other current liabilities | 245.8 | 235.1 |
Total current liabilities | 940.5 | 914.4 |
Noncurrent liabilities | ||
Long-term debt, net of unamortized deferred financing fees | 2,304.3 | 2,305.6 |
Noncurrent lease liabilities - operating | 65.1 | 69.2 |
Deferred income tax liabilities | 109.5 | 103.2 |
Other noncurrent obligations | 307.9 | 306.7 |
Total noncurrent liabilities | 2,786.8 | 2,784.7 |
Shareholders' equity | ||
Ordinary shares, $0.01 nominal value, 4,000.0 shares authorized (March 31, 2022: 39.0 shares issued and 37.2 shares outstanding; December 31, 2021: 38.9 shares issued and 37.9 shares outstanding) | 0.4 | 0.4 |
Additional paid-in-capital | 475.7 | 468.1 |
Treasury shares, at cost (March 31, 2022: 1.9 shares; December 31, 2021: 1.0 shares) | (100) | (50) |
Retained earnings | 746.4 | 741.8 |
Accumulated other comprehensive loss | (149.7) | (147.2) |
Total shareholders' equity | 972.8 | 1,013.1 |
Total liabilities and shareholders' equity | $ 4,700.1 | $ 4,712.2 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) shares in Thousands | Mar. 31, 2022$ / sharesshares | Mar. 31, 2022€ / sharesshares | Dec. 31, 2021$ / sharesshares | Dec. 31, 2021€ / sharesshares |
Ordinary shares, nominal value | $ / shares | $ 0.01 | $ 0.01 | ||
Ordinary shares, shares authorized | 4,000,000 | 4,000,000 | 4,000,000 | 4,000,000 |
Ordinary shares, shares issued | 39,100 | 39,100 | 38,900 | 38,900 |
Ordinary shares, shares outstanding | 37,200 | 37,200 | 37,900 | 37,900 |
Treasury stock, shares | 1,900 | 1,900 | 1,000 | 1,000 |
Preferred stock, par value | € / shares | € 0.01 | € 0.01 | ||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 | 0 | 0 |
Deferred Ordinary Shares | ||||
Ordinary shares, nominal value | € / shares | € 1 | € 1 | ||
Ordinary shares, shares authorized | 25 | 25 | 25 | 25 |
Ordinary shares, shares issued | 25 | 25 | 25 | 25 |
Ordinary shares, shares outstanding | 25 | 25 | 25 | 25 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Condensed Consolidated Statements of Operations | ||
Net sales | $ 1,386.7 | $ 986 |
Cost of sales | 1,210.7 | 797.1 |
Gross profit | 176 | 188.9 |
Selling, general and administrative expenses | 96.7 | 56.5 |
Equity in earnings of unconsolidated affiliates | 21.6 | 22.9 |
Other charges | 36.3 | |
Operating income | 64.6 | 155.3 |
Interest expense, net | 21.9 | 12 |
Acquisition purchase price hedge loss | 55 | |
Other expense, net | 3 | 2.4 |
Income from continuing operations before income taxes | 39.7 | 85.9 |
Provision for income taxes | 22.6 | 20.1 |
Net income from continuing operations | 17.1 | 65.8 |
Net income (loss) from discontinued operations, net of income taxes | (0.4) | 5.7 |
Net income | $ 16.7 | $ 71.5 |
Earnings Per Share | ||
Weighted average shares- basic | 37.3 | 38.5 |
Net income (loss) per share- basic, continuing operations | $ 0.46 | $ 1.71 |
Net income (loss) per share- basic, discontinued operations | (0.01) | 0.15 |
Net income per share- basic | $ 0.45 | $ 1.86 |
Weighted average shares- diluted | 38.1 | 39.5 |
Net income (loss) per share- diluted, continuing operations | $ 0.45 | $ 1.67 |
Net income (loss) per share- diluted, discontinued operations | (0.01) | 0.14 |
Net income per share- diluted | $ 0.44 | $ 1.81 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Condensed Consolidated Statements of Comprehensive Income (Loss) | ||
Net income | $ 16.7 | $ 71.5 |
Other comprehensive income (loss), net of tax: | ||
Cumulative translation adjustments | (4.3) | 0.4 |
Net gain (loss) on cash flow hedges | 1.5 | 4.6 |
Amounts reclassified from accumulated other comprehensive income | 0.3 | 1.1 |
Total other comprehensive income (loss), net of tax | (2.5) | 6.1 |
Comprehensive income (loss) | $ 14.2 | $ 77.6 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Shareholders' Equity - USD ($) shares in Millions, $ in Millions | Ordinary Shares | Additional Paid-In Capital | Treasury Shares | Total | Retained Earnings | Total |
Balance at beginning of period at Dec. 31, 2020 | $ 0.5 | $ 579.6 | $ (542.9) | $ (186.1) | $ 739.2 | $ 590.3 |
Balance at beginning of period, shares at Dec. 31, 2020 | 38.4 | 10.4 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 71.5 | 71.5 | ||||
Other comprehensive income | 6.1 | 6.1 | ||||
Share-based compensation activity | (1.1) | $ 12.9 | 11.8 | |||
Share-based compensation activity, shares | 0.3 | (0.3) | ||||
Dividends on ordinary shares | (3.4) | (3.4) | ||||
Balance at end of period at Mar. 31, 2021 | $ 0.5 | 578.5 | $ (530) | (180) | 807.3 | 676.3 |
Balance at end of period, shares at Mar. 31, 2021 | 38.7 | 10.1 | ||||
Balance at beginning of period at Dec. 31, 2021 | $ 0.4 | 468.1 | $ (50) | (147.2) | 741.8 | $ 1,013.1 |
Balance at beginning of period, shares at Dec. 31, 2021 | 37.9 | 1 | 37.9 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 16.7 | $ 16.7 | ||||
Other comprehensive income | (2.5) | (2.5) | ||||
Share-based compensation activity | 7.6 | 7.6 | ||||
Share-based compensation activity, shares | 0.2 | |||||
Purchase of treasury shares | $ (50) | (50) | ||||
Purchase of treasury shares, shares | (0.9) | 0.9 | ||||
Dividends on ordinary shares | (12.1) | (12.1) | ||||
Balance at end of period at Mar. 31, 2022 | $ 0.4 | $ 475.7 | $ (100) | $ (149.7) | $ 746.4 | $ 972.8 |
Balance at end of period, shares at Mar. 31, 2022 | 37.2 | 1.9 | 37.2 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Shareholders' Equity (Parenthetical)) - $ / shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Condensed Consolidated Statement of Stockholders' Equity | ||
Dividends on ordinary shares | $ 0.32 | $ 0.08 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash flows from operating activities | ||
Net income | $ 16.7 | $ 71.5 |
Less: Net income (loss) from discontinued operations | (0.4) | 5.7 |
Net income from continuing operations | 17.1 | 65.8 |
Adjustments to reconcile net income from continuing operations to net cash provided by operating activities - continuing operations | ||
Depreciation and amortization | 53 | 23.1 |
Amortization of deferred financing fees, issuance discount, and excluded component of hedging instruments | 2.3 | 1.2 |
Deferred income tax | 9 | 6.6 |
Share-based compensation expense | 8.3 | 3.4 |
Earnings of unconsolidated affiliates, net of dividends | (14.1) | (7.9) |
Unrealized net gain on foreign exchange forward contracts | (2.6) | (21.8) |
Acquisition purchase price hedge loss | 55 | |
Gain on sale of businesses and other assets | (0.3) | (0.2) |
Asset impairment charges or write-offs | 0.7 | |
Changes in assets and liabilities | ||
Accounts receivable | (79.8) | (138.8) |
Inventories | (66.2) | (82.5) |
Accounts payable and other current liabilities | 42 | 114.9 |
Income taxes payable | 5.9 | 4.9 |
Other assets, net | 12.7 | 4.7 |
Other liabilities, net | 6.8 | 12.3 |
Cash provided by (used in) operating activities - continuing operations | (5.2) | 40.7 |
Cash provided by operating activities - discontinued operations | 0.2 | 10.3 |
Cash provided by (used in) operating activities | (5) | 51 |
Cash flows from investing activities | ||
Capital expenditures | (23.9) | (11.2) |
Cash paid for asset or business acquisitions, net of cash acquired ($1.0 and $0.0) | (22.2) | |
Cash used in investing activities - continuing operations | (46.1) | (11.2) |
Cash used in investing activities - discontinued operations | (0.9) | (1.4) |
Cash used in investing activities | (47) | (12.6) |
Cash flows from financing activities | ||
Deferred financing fees | (1.3) | |
Short-term borrowings, net | (3.6) | (2.8) |
Purchase of treasury shares | (51.9) | |
Dividends paid | (12.4) | (3.3) |
Proceeds from exercise of option awards | 1.7 | 9 |
Withholding taxes paid on restricted share units | (0.8) | (0.8) |
Repayments of 2024 Term Loan B and 2028 Term Loan B | (3.6) | |
Net proceeds from issuance of 2029 Senior Notes | 450 | |
Cash provided by (used in) financing activities | (70.6) | 450.8 |
Effect of exchange rates on cash | (1.7) | (9.5) |
Net change in cash, cash equivalents, and restricted cash | (124.3) | 479.7 |
Cash, cash equivalents, and restricted cash-beginning of period | 573 | 588.7 |
Cash, cash equivalents, and restricted cash-end of period | $ 448.7 | 1,068.4 |
Less: Restricted cash | (450) | |
Restricted Cash and Cash Equivalents, Current, Asset, Statement of Financial Position [Extensible List] | Other Assets, Current | |
Cash and cash equivalents-end of period | $ 448.7 | 618.4 |
Supplemental disclosure of cash flow information | ||
Net cash paid | $ 1 | $ 0 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2022 | |
Basis of Presentation | |
Basis of Presentation | NOTE 1—BASIS OF PRESENTATION The unaudited interim condensed consolidated financial statements of Trinseo PLC and its subsidiaries (the “Company”) as of and for the periods ended March 31, 2022 and 2021 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 2021 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 February 23, 2022. The Company’s condensed consolidated financial statements presented herein reflect the latest estimates and assumptions made by management that affect the reported amounts and related disclosures as of and for the period ended March 31, 2022. However, actual results could differ from these estimates and assumptions. The December 31, 2021 condensed consolidated balance sheet data presented herein was derived from the Company’s December 31, 2021 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 year presentation. These reclassifications pertain primarily to the Company’s entry into an agreement during the second quarter of 2021 to sell its Synthetic Rubber business, as a result of which the Company reclassified its Synthetic Rubber assets and liabilities as held-for-sale and reclassified the operating results of its Synthetic Rubber business, net of taxes, as discontinued operations for all periods presented. The sale of the Synthetic Rubber business was completed in December 2021. Refer to Note 4 for further information. Throughout this Quarterly Report, unless otherwise indicated, amounts and activity are presented on a continuing operations basis. |
Recent Accounting Guidance
Recent Accounting Guidance | 3 Months Ended |
Mar. 31, 2022 | |
Recent Accounting Guidance | |
Recent Accounting Guidance | NOTE 2—RECENT ACCOUNTING GUIDANCE As of March 31, 2022, there was no recently issued accounting standards which would have a material effect on the Company’s condensed consolidated financial statements. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2022 | |
Acquisitions | |
Acquisitions | NOTE 3—ACQUISITIONS Acquisition of Heathland B.V. On January 3, 2022, the Company completed the acquisition of Heathland B.V. (“Heathland”) from Heathland Holding B.V. (“Heathland Holding”), through the purchase of all issued and outstanding shares (the “Heathland Acquisition”). The Heathland Acquisition was completed pursuant to the Sale and Purchase Agreement dated December 3, 2021 (“Heathland Agreement”), by and between the Company and Heathland Holding. Heathland is a leading collector and recycler of post-consumer and post-industrial plastic wastes in Europe. The total purchase price consideration is estimated to be $29.3 million, including an initial cash purchase price of $22.9 million, subject to customary working capital and other closing adjustments, as well as $6.4 million of contingent cash consideration, representing the fair value of certain earn-out payments. The maximum amount of potential earn-out payments is $6.8 million, which amounts will become payable to Heathland Holding as and when the related performance milestones or thresholds are achieved over the three-year period following the date of acquisition. The Heathland Acquisition was funded through existing cash on hand. Additionally, the Heathland Agreement includes a service fee of approximately $4.5 million, payable to Heathland Holdings contingent upon the continued employment of certain Heathland employees for three years following the acquisition date. The Company has not included this service fee as part of the estimated purchase price and instead will accrue for the service fee as compensation expense over the three-year period in which it is earned. The Company accounted for the acquisition as a business combination pursuant to ASC 805. In accordance with ASC 805, fair values are assigned to tangible and identifiable intangible assets acquired and liabilities assumed at the acquisition date based on the information that was available as of the acquisition date. The Company believes that the information available provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed for the acquisition, however, preliminary measurements of fair value, are subject to change during the measurement period. The Company allocated the purchase price of the acquisition to identifiable assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date. The excess of the purchase price over the aggregate fair values was recorded as goodwill. The table below summarizes the purchase price allocation for the assets acquired and liabilities assumed, based on their relative fair values, which have been assessed as of the January 3, 2022 acquisition date: January 3, 2022 Cash and cash equivalents $ 1.0 Other current assets 1.3 Other intangible assets (1) Customer relationships 5.1 Tradenames 0.9 Developed technology 0.2 Other assets 1.0 Total fair value of assets acquired 9.5 Current liabilities (1.3) Noncurrent liabilities (1.6) Total fair value of liabilities assumed (2.9) Net identifiable assets acquired 6.6 Purchase price consideration 29.3 Goodwill (2) $ 22.7 (1) The expected weighted average useful life of the acquired intangible assets are 7 years for customer relationships, tradenames and developed technology. (2) Goodwill largely consists of strategic and synergistic opportunities resulting from combining Heathland with the Company’s existing businesses and is allocated entirely to the Base Plastics segment. No goodwill related to this acquisition is expected to be deductible for income tax purposes. Pro forma results of operations information have not been presented as the effect of the acquisition is not material. The operating results of the Heathland acquisition are included within the Company's condensed consolidated statements of operations since the acquisition date of January 3, 2022 and were not material for the three months ended March 31, 2022. Pursuant to GAAP, costs incurred to complete the Heathland Acquisition as well as costs incurred to integrate into the Company’s operations are expensed as incurred. Transaction-related costs incurred, which are included within “Selling, general, and administrative expenses” in the condensed consolidated statements of operations, were not material for the three months ended March 31, 2022. Acquisition of Aristech Surfaces On September 1, 2021, the Company completed its previously announced acquisition of Aristech Surfaces LLC (“Aristech Surfaces”) from SK AA Holdings LLC (“SK AA Holdings”), the sole member of Aristech Surfaces, through purchase of 100% membership interest and intellectual property (the “Aristech Surfaces Acquisition”). The purchase price consideration for the Aristech Surfaces Acquisition amounted to was $449.5 million, all of which was paid for during the year ended December 31, 2021 (noting no cash flows during the three months ended March 31, 2021). Aristech Surfaces is a leading North America manufacturer and global provider of PMMA continuous cast and solid surface sheets, serving the wellness, architectural, transportation and industrial markets, whose results are included within the Engineered Materials segment. Aristech Surfaces’ products are used for a variety of applications, including the construction of hot tubs, swim spas, counter tops, signage, bath products and recreational vehicles. The Company allocated the purchase price of the acquisition to identifiable assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date. Refer to the Annual Report for further information. During the first quarter of 2022, there were no changes to the purchase price allocation for the acquisition of the Aristech Surfaces business. However, further adjustments may be necessary as a result of the Company’s on-going assessment of additional information that existed as of the acquisition date related to the fair value of assets acquired and liabilities assumed, including goodwill, during the measurement period. Acquisition of the PMMA Business On May 3, 2021, the Company completed its previously-announced acquisition of the polymethyl methacrylates (“PMMA”) and activated methyl methacrylates (“MMA”) business (together, the “PMMA business”) from Arkema S.A., (“Arkema”) through the purchase of 100% of the shares of certain subsidiaries of Arkema (the “PMMA Acquisition”). The purchase price consideration for the PMMA Acquisition was $1,364.9 million, all of which was paid for during the year ended December 31, 2021 (noting no cash flows during the three months ended March 31, 2021). PMMA is a transparent and rigid plastic with a wide range of end uses, and is an attractive adjacent chemistry which complements Trinseo’s existing offerings across several end markets including automotive, building & construction, medical and consumer electronics. PMMA results are included within the Engineered Materials segment. The Company allocated the purchase price of the acquisition to identifiable assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date. Refer to the Annual Report for further information. During the first quarter of 2022, there were no changes to the purchase price allocation for the acquisition of the PMMA business. However, further adjustments may be necessary as a result of the Company’s on-going assessment of additional information that existed as of the acquisition date related to the fair value of assets acquired and liabilities assumed, including goodwill, during the measurement period. Unaudited Pro Forma Financial Information The following unaudited pro forma financial information presents the consolidated results of operations of the Company with the PMMA business and Aristech Surfaces for the three months ended March 31, 2021 as if these acquisitions had occurred on January l, 2021. The proforma results were calculated by combining the results of Trinseo with the PMMA business and Aristech Surfaces but do not include adjustments related to cost savings or other synergies that are anticipated as a result of these acquisitions. Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations would have been if the acquisitions had occurred as of January 1, 2021, nor are they indicative of future results of operations. Three Months Ended March 31, 2021 Net sales $ 1,194.1 Net income $ 78.8 Income from continuing operations $ 73.1 |
Divestitures And Discontinued O
Divestitures And Discontinued Operations | 3 Months Ended |
Mar. 31, 2022 | |
Divestitures and Discontinued Operations | |
Divestitures and Discontinued Operations | NOTE 4—DIVESTITURES AND DISCONTINUED OPERATIONS On December 1, 2021, the Company completed the divestiture of its Synthetic Rubber business to Synthos S.A. and certain of its subsidiaries (together, “Synthos”) for a purchase price of The following table summarizes the results of the Synthetic Rubber business for the three months ended March 31, 2022 and 2021, which are reflected as discontinued operations in the Company’s condensed consolidated statements of operations: Three Months Ended March 31, 2022 2021 Net sales $ 0.1 $ 124.2 Cost of sales 0.7 111.1 Gross profit (loss) (0.6) 13.1 Selling, general and administrative expenses (0.2) 6.2 Operating income (loss) (0.4) 6.9 Other expense, net — 0.2 Income (loss) from discontinued operations before income taxes (0.4) 6.7 Provision for income taxes — 1.0 Net income (loss) from discontinued operations $ (0.4) $ 5.7 Amounts for operating net sales and costs of sales which had previously been eliminated in consolidation related to intercompany sales of styrene monomer to the Synthetic Rubber business are now reflected on a gross basis as a component of net sales and costs of sales from continuing operations for all periods presented. The Company has recast these amounts because upon completion of the sale of the Synthetic Rubber business, the Company will continue to have these ongoing transactions with Synthos, under a supply agreement executed in conjunction with the divestiture. Refer to Note 5 for recast segment net sales reflecting this adjustment. Additionally, the Company previously allocated certain corporate management overhead costs to the former Synthetic Rubber segment which may no longer be allocated to discontinued operations under the relevant authoritative accounting guidance. Accordingly, the Company has recast its segment reporting results to reflect the reattribution of these expenses in all periods presented. Refer to Note 16 for recast segment results reflecting this adjustment. |
Net Sales
Net Sales | 3 Months Ended |
Mar. 31, 2022 | |
Net Sales | |
Net Sales | NOTE 5—NET SALES Refer to the Annual Report for information on the Company's accounting policies and further background related to its net sales. The following table provides disclosure of net sales to external customers by primary geographical market (based on the location where sales originated), by segment for the three months ended March 31, 2022 and 2021. Prior period balances in this table have been recast to reflect current period presentation, as described in Notes 1 and 4, including updates for the classification of the Company’s former Synthetic Rubber segment as discontinued operations and the Company’s prior year resegmentation. Engineered Latex Base Three Months Ended Materials Binders Plastics Polystyrene Feedstocks Total March 31, 2022 United States $ 138.4 $ 82.2 $ 84.5 $ — $ 3.9 $ 309.0 Europe 118.7 150.9 246.6 214.6 66.4 797.2 Asia-Pacific 35.3 71.7 37.2 103.4 — 247.6 Rest of World 2.8 1.9 28.2 — — 32.9 Total $ 295.2 $ 306.7 $ 396.5 $ 318.0 $ 70.3 $ 1,386.7 March 31, 2021 United States $ 10.3 $ 67.8 $ 62.5 $ — $ 3.4 $ 144.0 Europe 21.0 117.5 197.9 149.3 70.0 555.7 Asia-Pacific 34.2 63.9 48.8 117.6 — 264.5 Rest of World 0.3 1.8 19.7 — — 21.8 Total $ 65.8 $ 251.0 $ 328.9 $ 266.9 $ 73.4 $ 986.0 |
Investments in Unconsolidated A
Investments in Unconsolidated Affiliates | 3 Months Ended |
Mar. 31, 2022 | |
Investments in Unconsolidated Affiliates | |
Investments in Unconsolidated Affiliates | NOTE 6—INVESTMENTS IN UNCONSOLIDATED AFFILIATES The Company is currently supplemented by one joint venture, Americas Styrenics LLC (“Americas Styrenics,” a styrene and polystyrene joint venture with Chevron Phillips Chemical Company LP), which is accounted for using the equity method. The results of Americas Styrenics are included within its own reporting segment. Americas Styrenics is a privately held company; therefore, a quoted market price for its equity interests is not available. The summarized financial information of the Company’s unconsolidated affiliate is shown below. Three Months Ended March 31, 2022 2021 Sales $ 524.4 $ 423.0 Gross profit $ 48.1 $ 65.4 Net income $ 36.1 $ 51.1 As of March 31, 2022 and December 31, 2021, the Company’s investment in Americas Styrenics was $262.0 million and $247.8 million, respectively, which was $13.0 million and $9.4 million greater than the Company’s 50% share of the underlying net assets of Americas Styrenics, respectively. This amount represents the difference between the book value of assets held by the joint venture and the Company’s 50% share of the total recorded value of the joint venture’s assets, inclusive of certain adjustments to conform with the Company’s accounting policies. This difference is being amortized over a weighted average remaining useful life of approximately 2.7 years as of March 31, 2022. The Company received dividends of $7.5 million and $15.0 million from Americas Styrenics during the three months ended March 31, 2022 and 2021, respectively. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2022 | |
Inventories | |
Inventories | NOTE 7—INVENTORIES Inventories consisted of the following: March 31, December 31, 2022 2021 Finished goods $ 309.7 $ 279.2 Raw materials and semi-finished goods 334.3 303.9 Supplies 38.0 37.9 Total $ 682.0 $ 621.0 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2022 | |
Debt | |
Debt | NOTE 8—DEBT Refer to the Annual Report for definitions of capitalized terms not included herein and further background on the Company’s debt structure discussed below. The Company was in compliance with all debt related covenants as of March 31, 2022 and December 31, 2021. As of March 31, 2022 and December 31, 2021, debt consisted of the following: March 31, 2022 December 31, 2021 Interest Rate as of March 31, 2022 Maturity Date Carrying Amount Unamortized Deferred Financing Fees (1) Total Debt, Less Unamortized Deferred Financing Fees Carrying Amount Unamortized Deferred Financing Fees (1) Total Debt, Less Unamortized Deferred Financing Fees Senior Credit Facility 2024 Term Loan B 2.457% September 2024 $ 668.6 $ (7.3) $ 661.3 $ 670.4 $ (8.0) $ 662.4 2028 Term Loan B 2.957% May 2028 741.1 (16.4) 724.7 742.8 (17.0) 725.8 2026 Revolving Facility (2) Various May 2026 — — — — — — 2029 Senior Notes 5.125% April 2029 450.0 (14.3) 435.7 450.0 (14.7) 435.3 2025 Senior Notes 5.375% September 2025 500.0 (4.7) 495.3 500.0 (5.0) 495.0 Accounts Receivable Securitization Facility (3) Various November 2024 — — — — — — Other indebtedness Various Various 5.5 — 5.5 5.6 — 5.6 Total debt $ 2,365.2 $ (42.7) $ 2,322.5 $ 2,368.8 $ (44.7) $ 2,324.1 Less: current portion (4) (18.2) (18.5) Total long-term debt, net of unamortized deferred financing fees $ 2,304.3 $ 2,305.6 (1) This caption does not include deferred financing fees related to the Company’s revolving facilities, which are included within “Deferred charges and other assets” on the condensed consolidated balance sheets. (2) As of March 31, 2022, under the 2026 Revolving Facility, the Company had a capacity of $375.0 million and funds available for borrowing of $368.6 million (net of $6.4 million outstanding letters of credit). Additionally, the Company is required to pay a quarterly commitment fee in respect of any unused commitments under this facility equal to 0.375% per annum. (3) As of March 31, 2022, this facility had a borrowing capacity of $150.0 million, and the Company had approximately $145.7 million of accounts receivable available to support this facility, based on the pool of eligible accounts receivable. (4) The current portion of long-term debt was primarily related to $14.5 million of the scheduled future principal payments on both the 2024 Term Loan B and 2028 Term Loan B as of March 31, 2022 and December 31, 2021. |
Goodwill
Goodwill | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill. | |
Goodwill | NOTE 9—GOODWILL The following table shows changes in the carrying amount of goodwill, by segment, from December 31, 2021 to March 31, 2022: Engineered Latex Base Americas Materials Binders Plastics Polystyrene Feedstocks Styrenics Total Balance at December 31, 2021 $ 667.3 $ 15.9 $ 22.4 $ 4.5 $ — $ — $ 710.1 Acquisitions (Note 3) — — 22.7 — — — 22.7 Foreign currency impact (4.0) (0.4) (0.9) (0.1) — — (5.4) Balance at March 31, 2022 $ 663.3 $ 15.5 $ 44.2 $ 4.4 $ — $ — $ 727.4 |
Derivative Instruments
Derivative Instruments | 3 Months Ended |
Mar. 31, 2022 | |
Derivative Instruments | |
Derivative Instruments | NOTE 10—DERIVATIVE INSTRUMENTS The Company’s ongoing business operations expose it to various risks, including fluctuating foreign exchange rates and interest rate risk. To manage these risks, the Company periodically enters into derivative financial instruments, such as foreign exchange forward contracts and interest rate swap agreements. 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 its 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 this exposure, the Company also uses foreign exchange forward contracts to economically hedge the impact of the variability in exchange rates on assets and liabilities denominated in certain foreign currencies. The Company entered into a specific such foreign exchange forward contract in December 2020 in order to economically hedge the euro-denominated purchase price of the Arkema PMMA business, which was acquired on May 3, 2021, as discussed in Note 3. These derivative contracts are not designated for hedge accounting treatment. As of March 31, 2022, the Company had open foreign exchange forward contracts with a notional U.S. dollar equivalent absolute value of $763.6 million. The following table displays the notional amounts of the most significant net foreign exchange hedge positions outstanding as of March 31, 2022: March 31, Buy / (Sell) 2022 Euro $ (642.2) Chinese Yuan $ (54.7) Swiss Franc $ 20.1 New Taiwan Dollar $ 13.4 Mexican Peso $ (13.4) Open foreign exchange forward contracts as of March 31, 2022 had maturities occurring over a period of two months. Foreign Exchange Cash Flow Hedges The Company also enters into forward contracts, as deemed appropriate, 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. The Company had no open foreign exchange cash flow hedges as of Interest Rate Swaps On September 6, 2017, the Company issued the 2024 Term Loan B, which currently bears an interest rate of LIBOR plus 2.00%, subject to a 0.00% LIBOR floor. In order to reduce the variability in interest payments associated with the Company’s variable rate debt, during 2017 the Company entered into certain interest rate swap agreements to convert a portion of these variable rate borrowings into a fixed rate obligation. These interest rate swap agreements are designated as cash flow hedges, and as such, the contracts are marked-to-market at each reporting date and any unrealized gains or losses are included in AOCI to the extent effective, and reclassified to interest expense in the period during which the transaction affects earnings or it becomes probable that the forecasted transaction will not occur. As of March 31, 2022, the Company had open interest rate swap agreements with a net notional U.S. dollar equivalent of $200.0 million which had an effective date of September 29, 2017 and mature in September 2022. Under the terms of the swap agreements, the Company is required to pay the counterparties a stream of fixed interest payments at a rate of 1.81%, and in turn, receives variable interest payments based on 1-month LIBOR (0.21% as of March 31, 2022) from the counterparties. Net Investment Hedge The Company accounts for its cross currency swaps (“CCS”) under the spot method, meaning that changes in the fair value of the hedge included in the assessment of effectiveness (changes due to spot foreign exchange rates) are recorded within AOCI, where they remain until either the sale or substantially complete liquidation of the subsidiary subject to the hedge. Additionally, the initial value of any component excluded from the assessment of effectiveness is recognized in income using a systematic and rational method over the life of the hedging instrument and any difference between the change in the fair value of the excluded component and amounts recognized in income under that systematic and rational method is recognized in AOCI. When applicable, the Company amortizes any initial excluded component value of a CCS as a reduction of “Interest expense, net” in the condensed consolidated statements of operations using the straight-line method over the remaining term of the related CCS. Additionally, interest receipts and payments are accrued under the terms of the Company’s CCS and are recognized within “Interest expense, net” in the condensed consolidated statements of operations. The Company entered into a CCS arrangement (the “2017 CCS”) on September 1, 2017, swapping U.S. dollar principal and interest payments of $500.0 million at an interest rate of 5.375% on its 2025 Senior Notes for euro-denominated payments of €420.0 million at a weighted average interest rate of 3.45% for approximately five years. On February 26, 2020, the Company settled its 2017 CCS and replaced it with a new CCS arrangement (the “2020 CCS”) that carried substantially the same terms as the 2017 CCS. Under the 2020 CCS, the Company notionally exchanged $500.0 million at an interest rate of 5.375% for €459.3 million at a weighted average interest rate of 3.672% for approximately 2.7 years, with a final maturity of November 3, 2022. The cash flows under the 2020 CCS are aligned with the Company’s principal and interest obligations on its 5.375% 2025 Senior Notes. Subsequent to the end of the first quarter, on April 7, 2022, the Company settled its existing 2020 CCS, which were set to mature in November 2022. Upon settlement of the 2020 CCS, the Company realized net cash proceeds of $1.9 million. Summary of Derivative Instruments The following table presents the effect of the Company’s derivative instruments, including those not designated for hedge accounting treatment, on the condensed consolidated statements of operations for the three months ended March 31, 2022 and 2021: Location and Amount of Gain (Loss) Recognized in Statements of Operations Three Months Ended Three Months Ended March 31, 2022 March 31, 2021 Cost of sales Interest expense, net Acquisition purchase price hedge loss Other expense, net Cost of sales Interest expense, net Acquisition purchase price hedge loss Other expense, net Total amount of income and (expense) line items presented in the statements of operations in which the effects of derivative instruments are recorded $ (1,210.7) $ (21.9) $ — $ (3.0) $ (797.1) $ (12.0) $ (55.0) $ (2.4) The effects of cash flow hedge instruments: Foreign exchange cash flow hedges Amount of gain (loss) reclassified from AOCI into income $ — $ — $ — $ — $ (0.3) $ — $ — $ — Interest rate swaps Amount of loss reclassified from AOCI into income $ — $ (0.8) $ — $ — $ — $ (0.8) $ — $ — The effects of net investment hedge instruments: Cross currency swaps (CCS) Amount of gain excluded from effectiveness testing $ — $ 2.1 $ — $ — $ — $ 1.9 $ — $ — The effects of derivatives not designated as hedge instruments: Foreign exchange forward contracts Amount of gain (loss) recognized in income (1) $ — $ — $ — $ 8.8 $ — $ — $ (55.0) $ 19.7 (1) The $55.0 million loss incurred from the change in fair value of the forward currency hedge arrangement on the euro-denominated purchase price of the Arkema PMMA business during the three months ended March 31, 2021 is presented separately in the condensed consolidated statements of operations from the gains recorded on the Company’s other foreign exchange forward contracts. The following table presents the effect of cash flow and net investment hedge accounting on AOCI for the three months ended March 31, 2022 and 2021: ` Gain (Loss) Recognized in AOCI on Balance Sheet Three Months Ended March 31, 2022 2021 Designated as Cash Flow Hedges Foreign exchange cash flow hedges $ — $ 3.7 Interest rate swaps 1.5 0.9 Total $ 1.5 $ 4.6 Designated as Net Investment Hedges Cross currency swaps (CCS) $ 6.1 $ 26.2 Total $ 6.1 $ 26.2 Gain (Loss) Recognized in Other expense, net in Statement of Operations Three Months Ended March 31, 2022 2021 Settlements and changes in the fair value of forward contracts (not designated as hedges) (1) $ 8.8 $ 19.7 Remeasurement of foreign currency-denominated assets and liabilities $ (10.2) $ (19.9) Total $ (1.4) $ (0.2) (1) Amount does not include the loss of $55.0 million recorded from the change in fair value of the forward currency hedge arrangement on the euro-denominated purchase price of the Arkema PMMA business during the three months ended March 31, 2021. The Company expects to reclassify in the next twelve months an approximate $0.7 million net loss from AOCI into earnings related to the Company’s outstanding interest rate swaps as of March 31, 2022. The following tables summarize the gross and net unrealized gains and losses, as well as the balance sheet classification, of outstanding derivatives recorded in the condensed consolidated balance sheets: March 31, 2022 Foreign Foreign Exchange Exchange Interest Cross Balance Sheet Forward Cash Flow Rate Currency Classification Contracts Hedges Swaps Swaps Total Asset Derivatives: Accounts receivable, net of allowance $ 4.4 $ — $ — $ — $ 4.4 Gross derivative asset position 4.4 — — — 4.4 Less: Counterparty netting (0.6) — — — (0.6) Net derivative asset position $ 3.8 $ — $ — $ — $ 3.8 Liability Derivatives: Accounts payable $ (0.7) $ — $ (0.7) $ (11.3) $ (12.7) Gross derivative liability position (0.7) — (0.7) (11.3) (12.7) Less: Counterparty netting 0.6 — — — 0.6 Net derivative liability position $ (0.1) $ — $ (0.7) $ (11.3) $ (12.1) Total net derivative position $ 3.7 $ — $ (0.7) $ (11.3) $ (8.3) December 31, 2021 Foreign Foreign Exchange Exchange Interest Cross Balance Sheet Forward Cash Flow Rate Currency Classification Contracts Hedges Swaps Swaps Total Asset Derivatives: Accounts receivable, net of allowance $ 2.3 $ — $ — $ — $ 2.3 Gross derivative asset position 2.3 — — — 2.3 Less: Counterparty netting (0.1) — — — (0.1) Net derivative asset position $ 2.2 $ — $ — $ — $ 2.2 Liability Derivatives: Accounts payable $ (1.3) $ — $ (2.2) $ (17.4) $ (20.9) Gross derivative liability position (1.3) — (2.2) (17.4) (20.9) Less: Counterparty netting 0.1 — — — 0.1 Net derivative liability position $ (1.2) $ — $ (2.2) $ (17.4) $ (20.8) Total net derivative position $ 1.0 $ — $ (2.2) $ (17.4) $ (18.6) Forward contracts, interest rate swaps, and cross currency swaps 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, these derivative instruments are recorded on a net basis by counterparty within the condensed consolidated balance sheets. Refer to Notes 11 and 18 of the condensed consolidated financial statements for further information regarding the fair value of the Company’s derivative instruments and the related changes in AOCI. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Measurements | |
Fair Value Measurements | NOTE 11—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 March 31, 2022 and December 31, 2021: March 31, 2022 Quoted Prices in Active Markets for Identical Items Significant Other Observable Inputs Significant Unobservable Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—Assets $ — $ 3.8 $ — $ 3.8 Foreign exchange forward contracts—(Liabilities) — (0.1) — (0.1) Interest rate swaps—(Liabilities) — (0.7) — (0.7) Cross currency swaps—(Liabilities) — (11.3) — (11.3) Total fair value $ — $ (8.3) $ — $ (8.3) December 31, 2021 Quoted Prices in Active Markets for Identical Items Significant Other Observable Inputs Significant Unobservable Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—Assets $ — $ 2.2 $ — $ 2.2 Foreign exchange forward contracts—(Liabilities) — (1.2) — (1.2) Interest rate swaps—(Liabilities) — (2.2) — (2.2) Cross currency swaps—(Liabilities) — (17.4) — (17.4) Total fair value $ — $ (18.6) $ — $ (18.6) 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, such as interest rate yield curves and currency spot and forward rates. Significant inputs to the valuation for these derivative instruments 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. Nonrecurring Fair Value Measurements The Company measured certain financial assets at fair value on a nonrecurring basis during the year ended December 31, 2021, which were still held as of March 31, 2022. These financial assets represent the Company’s styrene monomer assets in Boehlen, Germany, which it continues to operate. These assets were measured at fair value using underlying fixed asset records in conjunction with the use of industry experience and available market data, which are classified as Level 3 significant unobservable inputs in the fair value hierarchy. During the three months ended March 31, 2022, the Company recorded additional impairment charges of $0.7 million related to capital expenditures at the Boehlen styrene monomer facility that it determined to be impaired, which are also included within “Other charges” on the condensed consolidated statements of operations. Refer to the Company’s Annual Report for further information. As of March 31, 2022 and December 31, 2021, the value of the Boehlen styrene monomer assets are recorded at $3.3 million and $3.4 million, respectively, within the Company’s condensed consolidated balance sheets herein. There were no other financial assets 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 March 31, 2022 and December 31, 2021: As of As of March 31, 2022 December 31, 2021 2029 Senior Notes $ 416.4 $ 460.2 2028 Term Loan B 735.1 737.4 2025 Senior Notes 494.7 509.4 2024 Term Loan B 656.1 667.5 Total fair value $ 2,302.3 $ 2,374.5 The fair value of the Company’s debt facilities above (each Level 2 securities) is determined using over-the-counter market quotes and benchmark yields received from independent vendors. Fair value amount presented reflect the Company’s carrying value of debt, net of original issuance discount. There were no other significant financial instruments outstanding as of March 31, 2022 and December 31, 2021. |
Provision For Income Taxes
Provision For Income Taxes | 3 Months Ended |
Mar. 31, 2022 | |
Provision For Income Taxes | |
Provision For Income Taxes | NOTE 12—PROVISION FOR INCOME TAXES Three Months Ended March 31, 2022 2021 Effective income tax rate 56.9 % 23.4 % Provision for income taxes for the three months ended March 31, 2022 totaled $22.6 million, resulting in an effective tax rate of 56.9%. Provision for income taxes for the three months ended March 31, 2021 totaled $20.1 million, resulting in an effective tax rate of The effective income tax rate for the three months ended March 31, 2022 was primarily impacted by an estimated liability of $35.6 million related to the European Commission request for information, as described within Note 13 in the condensed consolidated financial statements, for which the Company estimates no tax benefit based on currently available information. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies. | |
Commitments and Contingencies | NOTE 13—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. Pursuant to the terms of the agreement associated with the Company’s formation, the pre-closing environmental liabilities were retained by Dow, and Dow agreed, subject to temporal, monetary, and other limitations to indemnify the Company from and against environmental liabilities incurred or relating to the predecessor periods. Other than certain immaterial environmental liabilities assumed as part of the PMMA Acquisition and the Aristech Surfaces Acquisition, no environmental claims have been asserted or threatened against the Company. The Company is not a potentially responsible party for any material amounts at any Superfund Sites. As of March 31, 2022 and December 31, 2021, the Company had $4.2 million and $4.4 million, respectively, of accrued obligations for environmental remediation or restoration costs, which were recorded at fair value within the opening balance sheets of the PMMA business and Aristech Surfaces during 2021. 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 over the next 12 months. 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 one 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 employees, 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. European Commission Request for Information On June 6, 2018, Trinseo Europe GmbH, a subsidiary of the Company, received a request for information in the form of a letter from the European Commission Directorate General for Competition (the “European Commission”) related to styrene monomer commercial activity in the European Economic Area. The Company subsequently commenced an internal investigation into these commercial activities and discovered instances of inappropriate activity. On October 28, 2019, a supplemental request for information was received from the European Commission. This request was limited to historical employment, entity, and organizational structures, along with certain financial, styrene purchasing, and styrene market information, as well as certain spot styrene purchase contracts. The Company has provided all information requested and continues to fully cooperate with the European Commission. As a result of further developments in this matter, during the three months ended March 31, 2022, the Company recorded a reserve for an estimated liability of $35.6 million, which is included within “Other charges” on the condensed consolidated statements of operations. The Company is unable to predict the ultimate outcome of this matter, which remains ongoing. Based on its findings, the European Commission may decide to adopt a final decision imposing additional fines and/or request certain behavioral or structural commitments from the Company. However, any additional potential losses incurred could be material to the Company’s results of operations, balance sheet, and cash flows. |
Pension Plans And Other Postret
Pension Plans And Other Postretirement Benefits | 3 Months Ended |
Mar. 31, 2022 | |
Pension Plans and Other Postretirement Benefits | |
Pension Plans and Other Postretirement Benefits | NOTE 14—PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS The components of net periodic benefit costs for all significant plans were as follows: Three Months Ended Three Months Ended March 31, March 31, Non-U.S. Defined Benefit Pension Plans U.S. Defined Benefit Pension (1) 2022 2021 2022 2021 Net periodic benefit cost Service cost $ 3.2 $ 4.1 $ 0.2 $ — Interest cost 0.7 0.5 0.2 — Expected return on plan assets (0.1) — (0.2) — Amortization of prior service credit (0.1) (0.2) — — Amortization of net loss 0.7 1.5 — — Net periodic benefit cost $ 4.4 $ 5.9 $ 0.2 $ — (1) The Company’s U.S. defined benefit pension plans were acquired in 2021, primarily in conjunction with the PMMA Acquisition, and as such, there were no net periodic benefit costs for the three months ended March 31, 2021. The Company had less than $0.1 million of net periodic benefit costs for its other postretirement plans for the three months ended March 31, 2022 and 2021. Service cost related to the Company’s defined benefit pension plans and other postretirement plans is included within “Cost of sales” and “Selling, general and administrative expenses,” whereas all other components of net periodic benefit cost are included within “Other expense, net” in the condensed consolidated statements of operations. As of March 31, 2022 and December 31, 2021, the Company’s benefit obligations included primarily in “Other noncurrent obligations” in the condensed consolidated balance sheets were $271.8 million and $274.7 million, respectively. The Company made cash contributions and benefit payments to unfunded plans of approximately $2.5 million during the three months ended March 31, 2022. The Company expects to make additional cash contributions, including benefit payments to unfunded plans, of approximately $6.5 million to its defined benefit plans for the remainder of 2022. |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2022 | |
Share-Based Compensation. | |
Share-Based Compensation | NOTE 15—SHARE-BASED COMPENSATION Refer to the Annual Report for definitions of capitalized terms not included herein and further background on the Company’s share-based compensation programs included in the tables below. The following table summarizes the Company’s share-based compensation expense for the three months ended March 31, 2022 and 2021, as well as unrecognized compensation cost as of March 31, 2022: As of Three Months Ended March 31, 2022 March 31, Unrecognized Weighted 2022 2021 Compensation Cost Average Years RSUs $ 4.6 $ 1.7 $ 13.6 2.1 Options 3.0 1.2 4.2 1.7 PSUs 0.7 0.5 5.8 2.4 Total share-based compensation expense $ 8.3 $ 3.4 The following table summarizes awards granted and the respective weighted average grant date fair value for the three months ended March 31, 2022: Three Months Ended March 31, 2022 Awards Granted Weighted Average Grant Date Fair Value per Award RSUs 124,373 $ 58.64 Options 185,192 22.71 PSUs 63,317 57.47 Option Awards The following are the weighted average assumptions used within the Black-Scholes pricing model for the Company’s option awards granted during the three months ended March 31, 2022: Three Months Ended March 31, 2022 Expected term (in years) 5.50 Expected volatility 48.84 % Risk-free interest rate 1.94 % Dividend yield 2.00 % The expected volatility assumption is determined based on the historical volatility of the Company’s publicly traded ordinary shares. The expected term of option awards represents the period of time that option awards granted are expected to be outstanding. For the option awards granted during the three months ended March 31, 2022, the simplified method was used to calculate the expected term, given the Company’s limited historical exercise data. The risk-free interest rate for the periods within the expected term of option awards 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. Performance Share Units (PSUs) The following are the weighted average assumptions used within the Monte Carlo valuation model for PSUs granted during the three months ended March 31, 2022: Three Months Ended March 31, 2022 Expected term (in years) 3.00 Expected volatility 57.30 % Risk-free interest rate 1.73 % Share price $ 58.64 Determining the fair value of PSUs requires considerable judgment, including estimating the expected volatility of the price of the Company’s ordinary shares, the correlation between the Company’s share price and that of its peer companies, and the expected rate of interest. The expected volatility for each grant is determined based on the historical volatility of the Company’s ordinary shares. The expected term of PSUs represents the length of the performance period. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for a duration equivalent to the performance period. The share price is the closing price of the Company’s ordinary shares on the grant date. |
Segments
Segments | 3 Months Ended |
Mar. 31, 2022 | |
Segments | |
Segments | NOTE 16—SEGMENTS As discussed in the Annual Report, beginning in the second quarter of 2021, the Company reported the results of the Synthetic Rubber business as discontinued operations in the condensed consolidated statements of operations for all periods presented, and therefore it is no longer presented as a separate reportable segment. Refer to Note 4 for further information. The information in the tables below has been retroactively adjusted to reflect these changes in reporting segments . The Engineered Materials segment includes the Company’s compounds and blends products sold into higher growth and value applications, such as consumer electronics and medical, as well as soft thermoplastic elastomers (“TPEs”) products which are sold into markets such as footwear and automotive. Additionally, PMMA and MMA products, which are sold into a variety of applications including automotive, building & construction, medical, consumer electronics, and wellness, among others. The Latex Binders segment produces styrene-butadiene latex (“SB latex”) and other latex polymers and binders, primarily for coated paper and packaging board, carpet and artificial turf backings, as well as a number of performance latex binders applications, such as adhesive, building and construction and the technical textile paper market. The Base Plastics segment contains the results of the acrylonitrile-butadiene-styrene (“ABS”), styrene-acrylonitrile (“SAN”), and polycarbonate (“PC”) businesses, as well as compounds and blends for automotive and other applications. The Base Plastics segment also includes the results of Heathland, which was acquired in the first quarter of 2022. The Polystyrene segment includes a variety of general purpose polystyrenes (“GPPS”) and polystyrene that has been modified with polybutadiene rubber to increase its impact resistant properties (“HIPS”). The Feedstocks segment includes the Company’s production and procurement of styrene monomer outside of North America, which is used as a key raw material in many of the Company’s products, including polystyrene, SB latex, and ABS resins. Lastly, the Americas Styrenics segment consists solely of the operations of the Company’s The following table provides disclosure of the Company’s segment Adjusted EBITDA, which is used to measure segment operating performance and is defined below, for the three months ended March 31, 2022 and 2021. Asset and intersegment sales information by reporting segment is not regularly reviewed or included with the Company’s reporting to the chief operating decision maker. Therefore, this information has not been disclosed below. Refer to Note 5 for the Company’s net sales to external customers by segment for the three months ended March 31, 2022 and 2021. Engineered Latex Base Americas Three Months Ended (1) Materials Binders Plastics Polystyrene Feedstocks Styrenics March 31, 2022 $ 34.7 $ 30.2 $ 68.6 $ 45.3 $ 4.1 $ 21.6 March 31, 2021 $ 7.9 $ 16.8 $ 65.3 $ 47.4 $ 46.3 $ 22.9 (1) The Company’s primary measure of segment operating performance is Adjusted EBITDA, which is defined as income from continuing operations before interest expense, net; provision for income taxes; depreciation and amortization expense; loss on extinguishment of long-term debt; asset impairment charges; gains or losses on the dispositions of businesses and assets; restructuring charges; acquisition related costs and benefits and other items. Segment Adjusted 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 core operating performance by removing the impact of transactions and events that would not be considered a part of core operations. Other companies in the industry may define segment Adjusted EBITDA differently than the Company, and as a result, it may be difficult to use segment Adjusted EBITDA, or similarly named financial measures, that other companies may use to compare the performance of those companies to the Company’s segment performance. The reconciliation of income from continuing operations before income taxes to segment Adjusted EBITDA is as follows: Three Months Ended March 31, 2022 2021 Income from continuing operations before income taxes $ 39.7 $ 85.9 Interest expense, net 21.9 12.0 Depreciation and amortization 53.0 23.1 Corporate Unallocated (2) 26.9 22.4 Adjusted EBITDA Addbacks (3) 63.0 63.2 Segment Adjusted EBITDA $ 204.5 $ 206.6 (2) Corporate unallocated includes corporate overhead costs and certain other income and expenses. (3) Adjusted EBITDA addbacks for the three months ended March 31, 2022 and 2021 are as follows: Three Months Ended March 31, 2022 2021 Net gain on disposition of businesses and assets $ (0.3) $ (0.2) Restructuring and other charges (Note 17) 0.4 0.3 Acquisition transaction and integration net costs (Note 3) 3.2 6.0 Acquisition purchase price hedge loss (Note 10) — 55.0 Asset impairment charges or write-offs (Note 11) 0.7 — European Commission request for information (Note 13) 35.6 — Other items (a) 23.4 2.1 Total Adjusted EBITDA Addbacks $ 63.0 $ 63.2 (a) Other items for the three months ended March 31, 2022 primarily relate to fees incurred in conjunction with certain of the Company’s strategic initiatives, as well as our transition to a new enterprise resource planning system. Other items for the three months ended March 31, 2021 primarily relate to fees incurred in conjunction with certain of the Company’s strategic initiatives. |
Restructuring
Restructuring | 3 Months Ended |
Mar. 31, 2022 | |
Restructuring | |
Restructuring | NOTE 17—RESTRUCTURING Refer to the Annual Report for further details regarding the Company’s previously announced restructuring activities included in the tables below. Restructuring charges are included within “Selling, general and administrative expenses” in the condensed consolidated statements of operations. The following table provides detail of the Company’s restructuring charges for the three months ended March 31, 2022 and 2021: Three Months Ended Cumulative March 31, Life-to-date 2022 2021 Charges Segment Transformational Restructuring Program Employee termination benefits $ 0.3 $ — $ 9.0 N/A (1) Transformational Restructuring Program Subtotal $ 0.3 $ — $ 9.0 Other Restructurings 0.1 0.3 Various Total Restructuring Charges $ 0.4 $ 0.3 (1) In May 2021, the Company approved a transformational restructuring program associated with the Company’s recent strategic initiatives. In connection with this restructuring program, during the three months ended March 31, 2022, the Company incurred employee termination benefits charges of $0.3 million. The Company expects to incur incremental employee termination benefit charges related to impacted employees as of March 31, 2022 of less than $1.0 million, the majority of which are expected to be paid by December 31, 2022. As this was identified as a corporate-related activity, the charges related to this restructuring program were not allocated to a specific segment, but rather included within corporate unallocated. The following table provides a roll forward of the liability balances associated with the Company’s restructuring activities as of March 31, 2022. Employee termination benefit and contract termination charges are primarily recorded within “Accrued expenses and other current liabilities” in the condensed consolidated balance sheets. Balance at Balance at December 31, 2021 Expenses Deductions (1) March 31, 2022 Employee termination benefits $ 10.0 $ 0.1 $ (1.7) $ 8.4 Decommissioning and other — 0.1 (0.1) — Total $ 10.0 $ 0.2 $ (1.8) $ 8.4 (1) Primarily includes payments made against the existing accrual, as well as immaterial impacts of foreign currency remeasurement. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2022 | |
Accumulated Other Comprehensive Income (Loss). | |
Accumulated Other Comprehensive Income (Loss) | NOTE 18—ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The components of AOCI, net of income taxes, consisted of: Cumulative Pension & Other Translation Postretirement Benefit Cash Flow Three Months Ended March 31, 2022 and 2021 Adjustments Plans, Net Hedges, Net Total Balance as of December 31, 2021 $ (114.3) $ (33.6) $ 0.7 $ (147.2) Other comprehensive income (loss) (4.3) — 0.7 (3.6) Amounts reclassified from AOCI to net income (1) — 0.3 0.8 1.1 Balance as of March 31, 2022 $ (118.6) $ (33.3) $ 2.2 $ (149.7) Balance as of December 31, 2020 $ (109.0) $ (71.9) $ (5.2) $ (186.1) Other comprehensive income (loss) 0.4 — 3.5 3.9 Amounts reclassified from AOCI to net income (1) — 1.1 1.1 2.2 Balance as of March 31, 2021 $ (108.6) $ (70.8) $ (0.6) $ (180.0) (1) The following is a summary of amounts reclassified from AOCI to net income (loss) for the three months ended March 31, 2022 and 2021: Three Months Ended March 31, Statements of Operations AOCI Components 2022 2021 Classification Cash flow hedging items Foreign exchange cash flow hedges $ — $ 0.3 Cost of sales Interest rate swaps 0.8 0.8 Interest expense, net Total before tax 0.8 1.1 Tax effect — — Provision for income taxes Total, net of tax $ 0.8 $ 1.1 Amortization of pension and other postretirement benefit plan items Prior service credit $ (0.1) $ (0.2) (a) Net actuarial loss 0.6 1.8 (a) Total before tax 0.5 1.6 Tax effect (0.2) (0.5) Provision for income taxes Total, net of tax $ 0.3 $ 1.1 (a) These AOCI components are included in the computation of net periodic benefit costs (see Note 14). . |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2022 | |
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, option awards, and PSUs. Diluted EPS considers the impact of potentially dilutive securities except in periods in which there is a loss from continuing operations 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 months ended March 31, 2022 and 2021. Amounts have been recast to reflect the Company’s classification of its Synthetic Rubber business as discontinued operations for all periods presented. Three Months Ended March 31, (in millions, except per share data) 2022 2021 Earnings: Net income from continuing operations $ 17.1 $ 65.8 Net income (loss) from discontinued operations (0.4) 5.7 Net income $ 16.7 $ 71.5 Shares: Weighted average ordinary shares outstanding 37.3 38.5 Dilutive effect of RSUs, option awards, and PSUs (1) 0.8 1.0 Diluted weighted average ordinary shares outstanding 38.1 39.5 Income (loss) per share: Income (loss) per share—basic: Continuing operations $ 0.46 $ 1.71 Discontinued operations (0.01) 0.15 Income per share—basic $ 0.45 $ 1.86 Income (loss) per share—diluted: Continuing operations $ 0.45 $ 1.67 Discontinued operations (0.01) 0.14 Income per share—diluted $ 0.44 $ 1.81 (1) Refer to Note 15 for discussion of RSUs, option awards, and PSUs granted to certain Company directors and employees. There were 0.9 million and 0.5 million anti-dilutive shares that have been excluded from the computation of diluted earnings per share for the three months ended March 31, 2022 and 2021, respectively. |
Other Charges
Other Charges | 3 Months Ended |
Mar. 31, 2022 | |
Other Charges | |
Other Charges | NOTE 20—OTHER CHARGES Other charges consisted of the following: Three Months Ended March 31, 2022 2021 Asset impairment charges or write-offs (Note 11) $ 0.7 $ — European Commission request for information (Note 13) 35.6 — Total $ 36.3 $ — |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Basis of Presentation | |
Basis of Presentation | The unaudited interim condensed consolidated financial statements of Trinseo PLC and its subsidiaries (the “Company”) as of and for the periods ended March 31, 2022 and 2021 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 2021 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 February 23, 2022. The Company’s condensed consolidated financial statements presented herein reflect the latest estimates and assumptions made by management that affect the reported amounts and related disclosures as of and for the period ended March 31, 2022. However, actual results could differ from these estimates and assumptions. The December 31, 2021 condensed consolidated balance sheet data presented herein was derived from the Company’s December 31, 2021 audited consolidated financial statements, but does not include all disclosures required by GAAP for annual periods. |
Reclassifications | Certain prior year amounts have been reclassified to conform to the current year presentation. These reclassifications pertain primarily to the Company’s entry into an agreement during the second quarter of 2021 to sell its Synthetic Rubber business, as a result of which the Company reclassified its Synthetic Rubber assets and liabilities as held-for-sale and reclassified the operating results of its Synthetic Rubber business, net of taxes, as discontinued operations for all periods presented. The sale of the Synthetic Rubber business was completed in December 2021. Refer to Note 4 for further information. Throughout this Quarterly Report, unless otherwise indicated, amounts and activity are presented on a continuing operations basis. |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Business Acquisition [Line Items] | |
Schedule of unaudited pro forma financial information | Three Months Ended March 31, 2021 Net sales $ 1,194.1 Net income $ 78.8 Income from continuing operations $ 73.1 |
Heathland B.V. | |
Business Acquisition [Line Items] | |
Schedule of purchase price allocation | January 3, 2022 Cash and cash equivalents $ 1.0 Other current assets 1.3 Other intangible assets (1) Customer relationships 5.1 Tradenames 0.9 Developed technology 0.2 Other assets 1.0 Total fair value of assets acquired 9.5 Current liabilities (1.3) Noncurrent liabilities (1.6) Total fair value of liabilities assumed (2.9) Net identifiable assets acquired 6.6 Purchase price consideration 29.3 Goodwill (2) $ 22.7 (1) The expected weighted average useful life of the acquired intangible assets are 7 years for customer relationships, tradenames and developed technology. (2) Goodwill largely consists of strategic and synergistic opportunities resulting from combining Heathland with the Company’s existing businesses and is allocated entirely to the Base Plastics segment. No goodwill related to this acquisition is expected to be deductible for income tax purposes. |
Divestitures And Discontinued_2
Divestitures And Discontinued Operations (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Emulsion Polymers, Synthetic Rubber | Discontinued Operations, Held-for-sale | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Summary of the assets and liabilities classified as held-for-sale and results reflected as discontinued operations | Three Months Ended March 31, 2022 2021 Net sales $ 0.1 $ 124.2 Cost of sales 0.7 111.1 Gross profit (loss) (0.6) 13.1 Selling, general and administrative expenses (0.2) 6.2 Operating income (loss) (0.4) 6.9 Other expense, net — 0.2 Income (loss) from discontinued operations before income taxes (0.4) 6.7 Provision for income taxes — 1.0 Net income (loss) from discontinued operations $ (0.4) $ 5.7 |
Net Sales (Tables)
Net Sales (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Net Sales | |
Disaggregation of Revenue [Table Text Block] | Engineered Latex Base Three Months Ended Materials Binders Plastics Polystyrene Feedstocks Total March 31, 2022 United States $ 138.4 $ 82.2 $ 84.5 $ — $ 3.9 $ 309.0 Europe 118.7 150.9 246.6 214.6 66.4 797.2 Asia-Pacific 35.3 71.7 37.2 103.4 — 247.6 Rest of World 2.8 1.9 28.2 — — 32.9 Total $ 295.2 $ 306.7 $ 396.5 $ 318.0 $ 70.3 $ 1,386.7 March 31, 2021 United States $ 10.3 $ 67.8 $ 62.5 $ — $ 3.4 $ 144.0 Europe 21.0 117.5 197.9 149.3 70.0 555.7 Asia-Pacific 34.2 63.9 48.8 117.6 — 264.5 Rest of World 0.3 1.8 19.7 — — 21.8 Total $ 65.8 $ 251.0 $ 328.9 $ 266.9 $ 73.4 $ 986.0 |
Investments in Unconsolidated_2
Investments in Unconsolidated Affiliates (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Investments in Unconsolidated Affiliates | |
Summarized Financial Information of Unconsolidated Affiliates | Three Months Ended March 31, 2022 2021 Sales $ 524.4 $ 423.0 Gross profit $ 48.1 $ 65.4 Net income $ 36.1 $ 51.1 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Inventories | |
Schedule of Inventories | March 31, December 31, 2022 2021 Finished goods $ 309.7 $ 279.2 Raw materials and semi-finished goods 334.3 303.9 Supplies 38.0 37.9 Total $ 682.0 $ 621.0 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Debt | |
Schedule of Debt [Table Text Block] | March 31, 2022 December 31, 2021 Interest Rate as of March 31, 2022 Maturity Date Carrying Amount Unamortized Deferred Financing Fees (1) Total Debt, Less Unamortized Deferred Financing Fees Carrying Amount Unamortized Deferred Financing Fees (1) Total Debt, Less Unamortized Deferred Financing Fees Senior Credit Facility 2024 Term Loan B 2.457% September 2024 $ 668.6 $ (7.3) $ 661.3 $ 670.4 $ (8.0) $ 662.4 2028 Term Loan B 2.957% May 2028 741.1 (16.4) 724.7 742.8 (17.0) 725.8 2026 Revolving Facility (2) Various May 2026 — — — — — — 2029 Senior Notes 5.125% April 2029 450.0 (14.3) 435.7 450.0 (14.7) 435.3 2025 Senior Notes 5.375% September 2025 500.0 (4.7) 495.3 500.0 (5.0) 495.0 Accounts Receivable Securitization Facility (3) Various November 2024 — — — — — — Other indebtedness Various Various 5.5 — 5.5 5.6 — 5.6 Total debt $ 2,365.2 $ (42.7) $ 2,322.5 $ 2,368.8 $ (44.7) $ 2,324.1 Less: current portion (4) (18.2) (18.5) Total long-term debt, net of unamortized deferred financing fees $ 2,304.3 $ 2,305.6 (1) This caption does not include deferred financing fees related to the Company’s revolving facilities, which are included within “Deferred charges and other assets” on the condensed consolidated balance sheets. (2) As of March 31, 2022, under the 2026 Revolving Facility, the Company had a capacity of $375.0 million and funds available for borrowing of $368.6 million (net of $6.4 million outstanding letters of credit). Additionally, the Company is required to pay a quarterly commitment fee in respect of any unused commitments under this facility equal to 0.375% per annum. (3) As of March 31, 2022, this facility had a borrowing capacity of $150.0 million, and the Company had approximately $145.7 million of accounts receivable available to support this facility, based on the pool of eligible accounts receivable. (4) The current portion of long-term debt was primarily related to $14.5 million of the scheduled future principal payments on both the 2024 Term Loan B and 2028 Term Loan B as of March 31, 2022 and December 31, 2021. |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill. | |
Changes in Carrying Amount of Goodwill, by Segment | Engineered Latex Base Americas Materials Binders Plastics Polystyrene Feedstocks Styrenics Total Balance at December 31, 2021 $ 667.3 $ 15.9 $ 22.4 $ 4.5 $ — $ — $ 710.1 Acquisitions (Note 3) — — 22.7 — — — 22.7 Foreign currency impact (4.0) (0.4) (0.9) (0.1) — — (5.4) Balance at March 31, 2022 $ 663.3 $ 15.5 $ 44.2 $ 4.4 $ — $ — $ 727.4 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Derivative Instruments | |
Notional Amounts of Most Significant Net Foreign Exchange Hedge Positions Outstanding | March 31, Buy / (Sell) 2022 Euro $ (642.2) Chinese Yuan $ (54.7) Swiss Franc $ 20.1 New Taiwan Dollar $ 13.4 Mexican Peso $ (13.4) |
Schedule of Effect of Derivative Instruments on Statements of Operations | Location and Amount of Gain (Loss) Recognized in Statements of Operations Three Months Ended Three Months Ended March 31, 2022 March 31, 2021 Cost of sales Interest expense, net Acquisition purchase price hedge loss Other expense, net Cost of sales Interest expense, net Acquisition purchase price hedge loss Other expense, net Total amount of income and (expense) line items presented in the statements of operations in which the effects of derivative instruments are recorded $ (1,210.7) $ (21.9) $ — $ (3.0) $ (797.1) $ (12.0) $ (55.0) $ (2.4) The effects of cash flow hedge instruments: Foreign exchange cash flow hedges Amount of gain (loss) reclassified from AOCI into income $ — $ — $ — $ — $ (0.3) $ — $ — $ — Interest rate swaps Amount of loss reclassified from AOCI into income $ — $ (0.8) $ — $ — $ — $ (0.8) $ — $ — The effects of net investment hedge instruments: Cross currency swaps (CCS) Amount of gain excluded from effectiveness testing $ — $ 2.1 $ — $ — $ — $ 1.9 $ — $ — The effects of derivatives not designated as hedge instruments: Foreign exchange forward contracts Amount of gain (loss) recognized in income (1) $ — $ — $ — $ 8.8 $ — $ — $ (55.0) $ 19.7 (1) The $55.0 million loss incurred from the change in fair value of the forward currency hedge arrangement on the euro-denominated purchase price of the Arkema PMMA business during the three months ended March 31, 2021 is presented separately in the condensed consolidated statements of operations from the gains recorded on the Company’s other foreign exchange forward contracts. |
Schedule of Effect of Hedges on AOCI | ` Gain (Loss) Recognized in AOCI on Balance Sheet Three Months Ended March 31, 2022 2021 Designated as Cash Flow Hedges Foreign exchange cash flow hedges $ — $ 3.7 Interest rate swaps 1.5 0.9 Total $ 1.5 $ 4.6 Designated as Net Investment Hedges Cross currency swaps (CCS) $ 6.1 $ 26.2 Total $ 6.1 $ 26.2 Gain (Loss) Recognized in Other expense, net in Statement of Operations Three Months Ended March 31, 2022 2021 Settlements and changes in the fair value of forward contracts (not designated as hedges) (1) $ 8.8 $ 19.7 Remeasurement of foreign currency-denominated assets and liabilities $ (10.2) $ (19.9) Total $ (1.4) $ (0.2) (1) Amount does not include the loss of $55.0 million recorded from the change in fair value of the forward currency hedge arrangement on the euro-denominated purchase price of the Arkema PMMA business during the three months ended March 31, 2021. |
Schedule of Gross and Net Unrealized Gains and Losses and Balance Sheet Classification | March 31, 2022 Foreign Foreign Exchange Exchange Interest Cross Balance Sheet Forward Cash Flow Rate Currency Classification Contracts Hedges Swaps Swaps Total Asset Derivatives: Accounts receivable, net of allowance $ 4.4 $ — $ — $ — $ 4.4 Gross derivative asset position 4.4 — — — 4.4 Less: Counterparty netting (0.6) — — — (0.6) Net derivative asset position $ 3.8 $ — $ — $ — $ 3.8 Liability Derivatives: Accounts payable $ (0.7) $ — $ (0.7) $ (11.3) $ (12.7) Gross derivative liability position (0.7) — (0.7) (11.3) (12.7) Less: Counterparty netting 0.6 — — — 0.6 Net derivative liability position $ (0.1) $ — $ (0.7) $ (11.3) $ (12.1) Total net derivative position $ 3.7 $ — $ (0.7) $ (11.3) $ (8.3) December 31, 2021 Foreign Foreign Exchange Exchange Interest Cross Balance Sheet Forward Cash Flow Rate Currency Classification Contracts Hedges Swaps Swaps Total Asset Derivatives: Accounts receivable, net of allowance $ 2.3 $ — $ — $ — $ 2.3 Gross derivative asset position 2.3 — — — 2.3 Less: Counterparty netting (0.1) — — — (0.1) Net derivative asset position $ 2.2 $ — $ — $ — $ 2.2 Liability Derivatives: Accounts payable $ (1.3) $ — $ (2.2) $ (17.4) $ (20.9) Gross derivative liability position (1.3) — (2.2) (17.4) (20.9) Less: Counterparty netting 0.1 — — — 0.1 Net derivative liability position $ (1.2) $ — $ (2.2) $ (17.4) $ (20.8) Total net derivative position $ 1.0 $ — $ (2.2) $ (17.4) $ (18.6) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Measurements | |
Schedule of Assets and Liabilities at Fair Value on Recurring Basis | March 31, 2022 Quoted Prices in Active Markets for Identical Items Significant Other Observable Inputs Significant Unobservable Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—Assets $ — $ 3.8 $ — $ 3.8 Foreign exchange forward contracts—(Liabilities) — (0.1) — (0.1) Interest rate swaps—(Liabilities) — (0.7) — (0.7) Cross currency swaps—(Liabilities) — (11.3) — (11.3) Total fair value $ — $ (8.3) $ — $ (8.3) December 31, 2021 Quoted Prices in Active Markets for Identical Items Significant Other Observable Inputs Significant Unobservable Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—Assets $ — $ 2.2 $ — $ 2.2 Foreign exchange forward contracts—(Liabilities) — (1.2) — (1.2) Interest rate swaps—(Liabilities) — (2.2) — (2.2) Cross currency swaps—(Liabilities) — (17.4) — (17.4) Total fair value $ — $ (18.6) $ — $ (18.6) |
Estimated Fair Value of Outstanding Debt Not Carried at Fair Value | As of As of March 31, 2022 December 31, 2021 2029 Senior Notes $ 416.4 $ 460.2 2028 Term Loan B 735.1 737.4 2025 Senior Notes 494.7 509.4 2024 Term Loan B 656.1 667.5 Total fair value $ 2,302.3 $ 2,374.5 |
Provision For Income Taxes (Tab
Provision For Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Provision For Income Taxes | |
Schedule of Effective Tax Rate | Three Months Ended March 31, 2022 2021 Effective income tax rate 56.9 % 23.4 % |
Pension Plans and Other Postr_2
Pension Plans and Other Postretirement Benefits (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Pension Plans and Other Postretirement Benefits | |
Schedule of Net Periodic Benefit Costs | Three Months Ended Three Months Ended March 31, March 31, Non-U.S. Defined Benefit Pension Plans U.S. Defined Benefit Pension (1) 2022 2021 2022 2021 Net periodic benefit cost Service cost $ 3.2 $ 4.1 $ 0.2 $ — Interest cost 0.7 0.5 0.2 — Expected return on plan assets (0.1) — (0.2) — Amortization of prior service credit (0.1) (0.2) — — Amortization of net loss 0.7 1.5 — — Net periodic benefit cost $ 4.4 $ 5.9 $ 0.2 $ — (1) The Company’s U.S. defined benefit pension plans were acquired in 2021, primarily in conjunction with the PMMA Acquisition, and as such, there were no net periodic benefit costs for the three months ended March 31, 2021. |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of Share-Based Compensation Expense and Unrecognized Compensation Cost | As of Three Months Ended March 31, 2022 March 31, Unrecognized Weighted 2022 2021 Compensation Cost Average Years RSUs $ 4.6 $ 1.7 $ 13.6 2.1 Options 3.0 1.2 4.2 1.7 PSUs 0.7 0.5 5.8 2.4 Total share-based compensation expense $ 8.3 $ 3.4 |
Summary of Awards Granted and Weighted Average Grant-Date Fair Value | Three Months Ended March 31, 2022 Awards Granted Weighted Average Grant Date Fair Value per Award RSUs 124,373 $ 58.64 Options 185,192 22.71 PSUs 63,317 57.47 |
Option Awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of Weighted-average Assumptions | Three Months Ended March 31, 2022 Expected term (in years) 5.50 Expected volatility 48.84 % Risk-free interest rate 1.94 % Dividend yield 2.00 % |
Performance Share Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of Weighted-average Assumptions | Three Months Ended March 31, 2022 Expected term (in years) 3.00 Expected volatility 57.30 % Risk-free interest rate 1.73 % Share price $ 58.64 |
Segments (Tables)
Segments (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Segments | |
Reconciliation of Segment Reporting to Consolidated | Engineered Latex Base Americas Three Months Ended (1) Materials Binders Plastics Polystyrene Feedstocks Styrenics March 31, 2022 $ 34.7 $ 30.2 $ 68.6 $ 45.3 $ 4.1 $ 21.6 March 31, 2021 $ 7.9 $ 16.8 $ 65.3 $ 47.4 $ 46.3 $ 22.9 (1) The Company’s primary measure of segment operating performance is Adjusted EBITDA, which is defined as income from continuing operations before interest expense, net; provision for income taxes; depreciation and amortization expense; loss on extinguishment of long-term debt; asset impairment charges; gains or losses on the dispositions of businesses and assets; restructuring charges; acquisition related costs and benefits and other items. Segment Adjusted 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 core operating performance by removing the impact of transactions and events that would not be considered a part of core operations. Other companies in the industry may define segment Adjusted EBITDA differently than the Company, and as a result, it may be difficult to use segment Adjusted EBITDA, or similarly named financial measures, that other companies may use to compare the performance of those companies to the Company’s segment performance. |
Reconciliation of IBT to Adjusted EBITDA | Three Months Ended March 31, 2022 2021 Income from continuing operations before income taxes $ 39.7 $ 85.9 Interest expense, net 21.9 12.0 Depreciation and amortization 53.0 23.1 Corporate Unallocated (2) 26.9 22.4 Adjusted EBITDA Addbacks (3) 63.0 63.2 Segment Adjusted EBITDA $ 204.5 $ 206.6 (2) Corporate unallocated includes corporate overhead costs and certain other income and expenses. (3) Adjusted EBITDA addbacks for the three months ended March 31, 2022 and 2021 are as follows: Three Months Ended March 31, 2022 2021 Net gain on disposition of businesses and assets $ (0.3) $ (0.2) Restructuring and other charges (Note 17) 0.4 0.3 Acquisition transaction and integration net costs (Note 3) 3.2 6.0 Acquisition purchase price hedge loss (Note 10) — 55.0 Asset impairment charges or write-offs (Note 11) 0.7 — European Commission request for information (Note 13) 35.6 — Other items (a) 23.4 2.1 Total Adjusted EBITDA Addbacks $ 63.0 $ 63.2 (a) Other items for the three months ended March 31, 2022 primarily relate to fees incurred in conjunction with certain of the Company’s strategic initiatives, as well as our transition to a new enterprise resource planning system. Other items for the three months ended March 31, 2021 primarily relate to fees incurred in conjunction with certain of the Company’s strategic initiatives. |
Restructuring (Tables)
Restructuring (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Restructuring | |
Detail of Restructuring Charges | Three Months Ended Cumulative March 31, Life-to-date 2022 2021 Charges Segment Transformational Restructuring Program Employee termination benefits $ 0.3 $ — $ 9.0 N/A (1) Transformational Restructuring Program Subtotal $ 0.3 $ — $ 9.0 Other Restructurings 0.1 0.3 Various Total Restructuring Charges $ 0.4 $ 0.3 (1) In May 2021, the Company approved a transformational restructuring program associated with the Company’s recent strategic initiatives. In connection with this restructuring program, during the three months ended March 31, 2022, the Company incurred employee termination benefits charges of $0.3 million. The Company expects to incur incremental employee termination benefit charges related to impacted employees as of March 31, 2022 of less than $1.0 million, the majority of which are expected to be paid by December 31, 2022. As this was identified as a corporate-related activity, the charges related to this restructuring program were not allocated to a specific segment, but rather included within corporate unallocated. |
Rollforward of Liability Balances | Balance at Balance at December 31, 2021 Expenses Deductions (1) March 31, 2022 Employee termination benefits $ 10.0 $ 0.1 $ (1.7) $ 8.4 Decommissioning and other — 0.1 (0.1) — Total $ 10.0 $ 0.2 $ (1.8) $ 8.4 (1) Primarily includes payments made against the existing accrual, as well as immaterial impacts of foreign currency remeasurement. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accumulated Other Comprehensive Income (Loss). | |
Components of AOCI, Net of Income Taxes | Cumulative Pension & Other Translation Postretirement Benefit Cash Flow Three Months Ended March 31, 2022 and 2021 Adjustments Plans, Net Hedges, Net Total Balance as of December 31, 2021 $ (114.3) $ (33.6) $ 0.7 $ (147.2) Other comprehensive income (loss) (4.3) — 0.7 (3.6) Amounts reclassified from AOCI to net income (1) — 0.3 0.8 1.1 Balance as of March 31, 2022 $ (118.6) $ (33.3) $ 2.2 $ (149.7) Balance as of December 31, 2020 $ (109.0) $ (71.9) $ (5.2) $ (186.1) Other comprehensive income (loss) 0.4 — 3.5 3.9 Amounts reclassified from AOCI to net income (1) — 1.1 1.1 2.2 Balance as of March 31, 2021 $ (108.6) $ (70.8) $ (0.6) $ (180.0) (1) The following is a summary of amounts reclassified from AOCI to net income (loss) for the three months ended March 31, 2022 and 2021: |
Summary of amounts reclassified from AOCI to net income (loss) | Three Months Ended March 31, Statements of Operations AOCI Components 2022 2021 Classification Cash flow hedging items Foreign exchange cash flow hedges $ — $ 0.3 Cost of sales Interest rate swaps 0.8 0.8 Interest expense, net Total before tax 0.8 1.1 Tax effect — — Provision for income taxes Total, net of tax $ 0.8 $ 1.1 Amortization of pension and other postretirement benefit plan items Prior service credit $ (0.1) $ (0.2) (a) Net actuarial loss 0.6 1.8 (a) Total before tax 0.5 1.6 Tax effect (0.2) (0.5) Provision for income taxes Total, net of tax $ 0.3 $ 1.1 (a) These AOCI components are included in the computation of net periodic benefit costs (see Note 14). |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share | |
Schedule of Earnings per Share Basic and Diluted | Three Months Ended March 31, (in millions, except per share data) 2022 2021 Earnings: Net income from continuing operations $ 17.1 $ 65.8 Net income (loss) from discontinued operations (0.4) 5.7 Net income $ 16.7 $ 71.5 Shares: Weighted average ordinary shares outstanding 37.3 38.5 Dilutive effect of RSUs, option awards, and PSUs (1) 0.8 1.0 Diluted weighted average ordinary shares outstanding 38.1 39.5 Income (loss) per share: Income (loss) per share—basic: Continuing operations $ 0.46 $ 1.71 Discontinued operations (0.01) 0.15 Income per share—basic $ 0.45 $ 1.86 Income (loss) per share—diluted: Continuing operations $ 0.45 $ 1.67 Discontinued operations (0.01) 0.14 Income per share—diluted $ 0.44 $ 1.81 (1) Refer to Note 15 for discussion of RSUs, option awards, and PSUs granted to certain Company directors and employees. There were 0.9 million and 0.5 million anti-dilutive shares that have been excluded from the computation of diluted earnings per share for the three months ended March 31, 2022 and 2021, respectively. |
Other Charges (Tables)
Other Charges (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Other Charges | |
Schedule of Other Charges | Three Months Ended March 31, 2022 2021 Asset impairment charges or write-offs (Note 11) $ 0.7 $ — European Commission request for information (Note 13) 35.6 — Total $ 36.3 $ — |
Acquisitions - Heathland B.V (D
Acquisitions - Heathland B.V (Details) - USD ($) $ in Millions | Jan. 03, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||
Goodwill | $ 727.4 | $ 710.1 | |
Heathland B.V. | |||
Business Acquisition [Line Items] | |||
Contingent payments to be paid | $ 6.4 | ||
Consideration paid upon signing the agreement | $ 22.9 | ||
Expected life | 7 years | ||
Contingent service fee | $ 4.5 | ||
Continuous employment period | 3 years | ||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||
Current Assets | $ 1.3 | ||
Noncurrent assets | 1 | ||
Total fair value of assets acquired | 9.5 | ||
Current liabilities | (1.3) | ||
Noncurrent liabilities | (1.6) | ||
Total fair value of liabilities assumed | (2.9) | ||
Net assets acquired | 6.6 | ||
Purchase price consideration | 29.3 | ||
Goodwill | 22.7 | ||
Heathland B.V. | Maximum | |||
Business Acquisition [Line Items] | |||
Consideration paid upon signing the agreement | 6.8 | ||
Heathland B.V. | Customer Relationships | |||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||
Other intangible assets | 5.1 | ||
Heathland B.V. | Trade Names | |||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||
Other intangible assets | 0.9 | ||
Heathland B.V. | Developed Technology | |||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||
Other intangible assets | $ 0.2 |
Acquisitions - Aristech (Detail
Acquisitions - Aristech (Details) - USD ($) $ in Millions | Sep. 01, 2021 | May 03, 2021 | Jan. 31, 2022 | Mar. 31, 2022 |
Aristech Surfaces L L C | ||||
Business Acquisition [Line Items] | ||||
Equity interest acquired | 100.00% | |||
Purchase price consideration | $ 449.5 | |||
Changes to purchase price allocation | $ 0 | |||
PMMA Business | ||||
Business Acquisition [Line Items] | ||||
Equity interest acquired | 100.00% | |||
Purchase price consideration | $ 1,364.9 | |||
Changes to purchase price allocation | $ 0 |
Acquisitions - Pro Forma and tr
Acquisitions - Pro Forma and transaction costs (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Business Acquisition, Pro Forma Information [Abstract] | |
Net sales | $ 1,194.1 |
Net income (loss) | 78.8 |
Income (loss) from continuing operations | $ 73.1 |
Divestitures and Discontinued_3
Divestitures and Discontinued Operations (Details) - Emulsion Polymers, Synthetic Rubber - Disposal Group, Disposed of by Sale, Not Discontinued Operations $ in Millions | Dec. 01, 2021USD ($) |
Disclosures by disposal group | |
Consideration | $ 402.4 |
Pension and other postretirement benefits | 41.6 |
Working capital target | $ 47 |
Divestitures and Discontinued_4
Divestitures and Discontinued Operations - Results (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Discontinued Operation, Income (Loss) from Discontinued Operation Disclosures [Abstract] | ||
Net income (loss) from discontinued operations | $ (0.4) | $ 5.7 |
Emulsion Polymers, Synthetic Rubber | Discontinued Operations, Held-for-sale | ||
Discontinued Operation, Income (Loss) from Discontinued Operation Disclosures [Abstract] | ||
Net sales | 0.1 | 124.2 |
Cost of sales | 0.7 | 111.1 |
Gross profit (loss) | (0.6) | 13.1 |
Selling, general and administrative expenses | (0.2) | 6.2 |
Operating income (loss) | (0.4) | 6.9 |
Other expense, net | (0.2) | |
Income (loss) from discontinued operations before income taxes | (0.4) | 6.7 |
Provision for income taxes | 1 | |
Net income (loss) from discontinued operations | (0.4) | $ 5.7 |
Emulsion Polymers, Synthetic Rubber | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||
Discontinued Operation, Income (Loss) from Discontinued Operation Disclosures [Abstract] | ||
Net sales related to supply agreement | 19.1 | |
Cost of sales related to supply agreement | $ 16.2 |
Net Sales (Details)
Net Sales (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 1,386.7 | $ 986 |
Engineered Materials | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 306.7 | 251 |
Latex Binders | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 295.2 | 65.8 |
Base Plastics | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 396.5 | 328.9 |
Polystyrene | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 318 | 266.9 |
Feedstocks | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 70.3 | 73.4 |
United States | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 309 | 144 |
United States | Engineered Materials | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 82.2 | 67.8 |
United States | Latex Binders | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 138.4 | 10.3 |
United States | Base Plastics | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 84.5 | 62.5 |
United States | Feedstocks | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 3.9 | 3.4 |
Europe | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 797.2 | 555.7 |
Europe | Engineered Materials | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 150.9 | 117.5 |
Europe | Latex Binders | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 118.7 | 21 |
Europe | Base Plastics | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 246.6 | 197.9 |
Europe | Polystyrene | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 214.6 | 149.3 |
Europe | Feedstocks | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 66.4 | 70 |
Asia-Pacific | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 247.6 | 264.5 |
Asia-Pacific | Engineered Materials | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 71.7 | 63.9 |
Asia-Pacific | Latex Binders | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 35.3 | 34.2 |
Asia-Pacific | Base Plastics | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 37.2 | 48.8 |
Asia-Pacific | Polystyrene | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 103.4 | 117.6 |
Rest of World | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 32.9 | 21.8 |
Rest of World | Engineered Materials | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 1.9 | 1.8 |
Rest of World | Latex Binders | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 2.8 | 0.3 |
Rest of World | Base Plastics | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 28.2 | $ 19.7 |
Investments in Unconsolidated_3
Investments in Unconsolidated Affiliates (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2022USD ($)item | Mar. 31, 2021USD ($) | |
Schedule of Equity Method Investments [Line Items] | ||
Number of joint ventures | item | 1 | |
Summarized Financial Information, Net Income | ||
Gross profit | $ 176 | $ 188.9 |
Net income | 16.7 | 71.5 |
AmSty | ||
Summarized Financial Information, Net Income | ||
Net sales | 524.4 | 423 |
Gross profit | 48.1 | 65.4 |
Net income | $ 36.1 | $ 51.1 |
Investments in Unconsolidated_4
Investments in Unconsolidated Affiliates - Americas Styrenics (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Investments in Unconsolidated Affiliates | |||
Investments in unconsolidated affiliates | $ 262 | $ 247.8 | |
AmSty | |||
Investments in Unconsolidated Affiliates | |||
Investments in unconsolidated affiliates | 262 | 247.8 | |
Investment in unconsolidated affiliates-difference between carrying amount and underlying equity | $ 13 | $ 9.4 | |
Percentage of ownership underlying net assets | 50.00% | 50.00% | |
Amortized weighted average remaining useful life | 2.7 | ||
Dividends received from operating activities | $ 7.5 | $ 15 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Inventories | ||
Finished goods | $ 309.7 | $ 279.2 |
Raw materials and semi-finished goods | 334.3 | 303.9 |
Supplies | 38 | 37.9 |
Total | $ 682 | $ 621 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) € in Millions, $ in Millions | 3 Months Ended | ||||
Mar. 31, 2022USD ($) | Dec. 31, 2021USD ($) | Feb. 26, 2020USD ($) | Feb. 26, 2020EUR (€) | Sep. 01, 2017USD ($) | |
Debt Instruments | |||||
Carrying amount | $ 2,365.2 | $ 2,368.8 | |||
Unamortized deferred financing fees | (42.7) | (44.7) | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | 2,322.5 | 2,324.1 | |||
Less: current portion | (18.2) | (18.5) | |||
Total long-term debt, net of unamortized deferred financing fees | 2,304.3 | 2,305.6 | |||
Term Loan B | |||||
Debt Instruments | |||||
Less: current portion | $ (14.5) | ||||
2024 Term Loan B | |||||
Debt Instruments | |||||
Interest rate at end of period (as a percent) | 2.457% | ||||
Carrying amount | $ 668.6 | 670.4 | |||
Unamortized deferred financing fees | (7.3) | (8) | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | $ 661.3 | 662.4 | |||
2028 Term Loan B | |||||
Debt Instruments | |||||
Interest rate at end of period (as a percent) | 2.957% | ||||
Carrying amount | $ 741.1 | 742.8 | |||
Unamortized deferred financing fees | (16.4) | (17) | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | 724.7 | 725.8 | |||
2026 Revolving Facility | |||||
Debt Instruments | |||||
Funds available for borrowings | 368.6 | ||||
Letters of credit, amount outstanding | $ 6.4 | ||||
Commitment fee (as a percent) | 0.375% | ||||
Maximum borrowing capacity | $ 375 | ||||
2029 Senior Notes | |||||
Debt Instruments | |||||
Interest rate | 5.125% | ||||
Carrying amount | $ 450 | 450 | |||
Unamortized deferred financing fees | (14.3) | (14.7) | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | $ 435.7 | 435.3 | |||
2025 Senior Notes | |||||
Debt Instruments | |||||
Interest rate | 5.375% | 5.375% | 5.375% | 5.375% | |
Carrying amount | $ 500 | 500 | |||
Unamortized deferred financing fees | (4.7) | (5) | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | 495.3 | 495 | $ 500 | € 459.3 | $ 500 |
Accounts Receivable Securitization Facility | |||||
Debt Instruments | |||||
Carrying amount | 0 | 0 | |||
Unamortized deferred financing fees | 0 | 0 | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | 0 | 0 | |||
Maximum borrowing capacity | 150 | ||||
Accounts receivable available to support facility | 145.7 | ||||
Other Indebtedness | |||||
Debt Instruments | |||||
Carrying amount | 5.5 | 5.6 | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | $ 5.5 | $ 5.6 |
Goodwill - Schedule of Carrying
Goodwill - Schedule of Carrying Amount of Goodwill (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Goodwill [Roll Forward] | |
Beginning Balance | $ 710.1 |
Acquisition | 22.7 |
Foreign currency impact | (5.4) |
Ending Balance | 727.4 |
Engineered Materials | |
Goodwill [Roll Forward] | |
Beginning Balance | 667.3 |
Foreign currency impact | (4) |
Ending Balance | 663.3 |
Latex Binders | |
Goodwill [Roll Forward] | |
Beginning Balance | 15.9 |
Foreign currency impact | (0.4) |
Ending Balance | 15.5 |
Base Plastics | |
Goodwill [Roll Forward] | |
Beginning Balance | 22.4 |
Acquisition | 22.7 |
Foreign currency impact | (0.9) |
Ending Balance | 44.2 |
Polystyrene | |
Goodwill [Roll Forward] | |
Beginning Balance | 4.5 |
Foreign currency impact | (0.1) |
Ending Balance | $ 4.4 |
Derivative Instruments (Details
Derivative Instruments (Details) € in Millions, $ in Millions | Apr. 07, 2022USD ($) | Feb. 26, 2020USD ($) | Sep. 01, 2017USD ($) | Mar. 31, 2022USD ($)item | Dec. 31, 2021USD ($) | Feb. 26, 2020EUR (€) | Sep. 01, 2017EUR (€) |
Derivative Instruments | |||||||
Total debt | $ 2,322.5 | $ 2,324.1 | |||||
Foreign Exchange Forward Contracts | |||||||
Derivative Instruments | |||||||
Derivative term | 2 months | ||||||
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments | |||||||
Derivative Instruments | |||||||
Derivative contracts, notional amount | $ 763.6 | ||||||
Foreign Exchange Forward Contracts | Designated as Hedging Instrument | |||||||
Derivative Instruments | |||||||
Number of subsidiaries participating | item | 1 | ||||||
Foreign Exchange Forward Contracts | Designated as Hedging Instrument | Cash Flow Hedges | |||||||
Derivative Instruments | |||||||
Amount hedged | $ 0 | ||||||
Cross Currency Swap | |||||||
Derivative Instruments | |||||||
Derivative contracts, notional amount | € | € 420 | ||||||
Derivative term | 2 years 8 months 12 days | 5 years | |||||
Cross currency swap weighted average interest rate (as a percent) | 3.672% | 3.45% | |||||
Cash proceeds | $ 1.9 | ||||||
Interest Rate Swap | |||||||
Derivative Instruments | |||||||
Derivative contracts, notional amount | $ 200 | ||||||
Fixed interest rate per agreement (as a percent) | 1.81% | ||||||
LIBOR rate at end of period (as a percent) | 0.21% | ||||||
2025 Senior Notes | |||||||
Derivative Instruments | |||||||
Total debt | $ 500 | $ 500 | $ 495.3 | 495 | € 459.3 | ||
Interest rate | 5.375% | 5.375% | 5.375% | 5.375% | 5.375% | ||
2024 Term Loan B | |||||||
Derivative Instruments | |||||||
Total debt | $ 661.3 | $ 662.4 | |||||
2024 Term Loan B | LIBOR | |||||||
Derivative Instruments | |||||||
Debt instrument, margin rate | 2.00% | ||||||
Variable rate floor (as a percent) | 0.00% | ||||||
Euro | (Sell) | |||||||
Derivative Instruments | |||||||
Derivative contracts, notional amount | $ 642.2 | ||||||
Chinese Yuan | (Sell) | |||||||
Derivative Instruments | |||||||
Derivative contracts, notional amount | 54.7 | ||||||
Swiss Franc | Buy | |||||||
Derivative Instruments | |||||||
Derivative contracts, notional amount | 20.1 | ||||||
Taiwan, New Dollars | (Sell) | |||||||
Derivative Instruments | |||||||
Derivative contracts, notional amount | 13.4 | ||||||
Mexico, Pesos | (Sell) | |||||||
Derivative Instruments | |||||||
Derivative contracts, notional amount | $ 13.4 |
Derivative Instruments - Income
Derivative Instruments - Income Statements (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Cost of Sales | $ (1,210.7) | $ (797.1) |
Interest expense, net | 21.9 | 12 |
Gain (Loss) on Derivative Instruments, Net, Pretax | (55) | |
Other expense, net | 3 | 2.4 |
Amount of gain (loss) recognized in income, not designated | (55) | |
Cost of Sales | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Cost of Sales | (1,210.7) | (797.1) |
Interest Expense, Net | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Interest expense, net | (21.9) | (12) |
Acquisition purchase price hedge gain (loss) | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Gain (Loss) on Derivative Instruments, Net, Pretax | (55) | |
Other expense, net | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Other expense, net | (3) | (2.4) |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments | Acquisition purchase price hedge gain (loss) | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Amount of gain (loss) recognized in income, not designated | (55) | (55) |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments | Other expense, net | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Amount of gain (loss) recognized in income, not designated | 8.8 | 19.7 |
Foreign Exchange Forward Contracts | Designated as Hedging Instrument | Cost of Sales | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Amount of gain (loss) reclassified from AOCI into income, foreign exchange cash flow hedges | (0.3) | |
Cross Currency Swap | Interest Expense, Net | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Amount of gain excluded from effectiveness testing | 2.1 | 1.9 |
Interest Rate Swap | Interest Expense, Net | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Amount of gain (loss) reclassified from AOCI into income, interest rate cash flow hedges | $ (0.8) | $ (0.8) |
Derivative Instruments - Effect
Derivative Instruments - Effect on AOCI (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Derivative Instruments | ||
Gain (Loss) Recognized in AOCI, Cash flow hedges | $ 1.5 | $ 4.6 |
Gain (Loss) Recognized in AOCI, Net investment hedges | 6.1 | 26.2 |
Foreign Exchange Forward Contracts | ||
Derivative Instruments | ||
Gain (Loss) Recognized in AOCI, Cash flow hedges | 3.7 | |
Cross Currency Swap | ||
Derivative Instruments | ||
Gain (Loss) Recognized in AOCI, Net investment hedges | 6.1 | 26.2 |
Interest Rate Swap | ||
Derivative Instruments | ||
Gain (Loss) Recognized in AOCI, Cash flow hedges | $ 1.5 | $ 0.9 |
Derivative Instruments - Gains
Derivative Instruments - Gains and Losses in Other expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Amount of gain (loss) recognized in income, not designated | $ (55) | |
Reclassification expected during next 12 months | $ 0.7 | |
Other expense, net | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Foreign exchange transaction gains (losses) | (10.2) | (19.9) |
Derivative, Gain (Loss) on Derivative, Net, Total | (1.4) | (0.2) |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments | Other expense, net | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Amount of gain (loss) recognized in income, not designated | 8.8 | 19.7 |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments | Acquisition purchase price hedge gain (loss) | ||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||
Amount of gain (loss) recognized in income, not designated | $ (55) | $ (55) |
Derivative Instruments - Financ
Derivative Instruments - Financial Assets and Liabilities (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | $ 4.4 | $ 2.3 |
Counterparty netting, derivative assets | (0.6) | (0.1) |
Net derivative asset position | 3.8 | 2.2 |
Gross derivative liability position | (12.7) | (20.9) |
Counterparty netting, derivative liabilities | 0.6 | 0.1 |
Net derivative liability position | (12.1) | (20.8) |
Total net derivative position | (8.3) | (18.6) |
Accounts Receivable | ||
Derivatives, Financial Assets and Liabilities | ||
Derivative assets | 4.4 | |
Gross derivative asset position | 2.3 | |
Accounts Payable | ||
Derivatives, Financial Assets and Liabilities | ||
Liabilities at fair value | (12.7) | |
Gross derivative liability position | (20.9) | |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 4.4 | 2.3 |
Counterparty netting, derivative assets | (0.6) | (0.1) |
Net derivative asset position | 3.8 | 2.2 |
Gross derivative liability position | (0.7) | (1.3) |
Counterparty netting, derivative liabilities | 0.6 | 0.1 |
Net derivative liability position | (0.1) | (1.2) |
Total net derivative position | 3.7 | 1 |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments | Accounts Receivable | ||
Derivatives, Financial Assets and Liabilities | ||
Derivative assets | 4.4 | |
Gross derivative asset position | 2.3 | |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments | Accounts Payable | ||
Derivatives, Financial Assets and Liabilities | ||
Liabilities at fair value | (0.7) | |
Gross derivative liability position | (1.3) | |
Interest Rate Swap | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative liability position | (0.7) | (2.2) |
Net derivative liability position | (0.7) | (2.2) |
Total net derivative position | (0.7) | (2.2) |
Interest Rate Swap | Accounts Payable | ||
Derivatives, Financial Assets and Liabilities | ||
Liabilities at fair value | (0.7) | |
Gross derivative liability position | (2.2) | |
Cross Currency Swap | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative liability position | (11.3) | (17.4) |
Net derivative liability position | (11.3) | (17.4) |
Total net derivative position | (11.3) | (17.4) |
Cross Currency Swap | Accounts Payable | ||
Derivatives, Financial Assets and Liabilities | ||
Liabilities at fair value | $ (11.3) | |
Gross derivative liability position | $ (17.4) |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities at Fair Value, Recurring (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2021 | |
Fair Value Measurements | ||
Total net derivative position | $ (8.3) | $ (18.6) |
Boehlen Location | ||
Fair Value Measurements | ||
Impairment loss on assets | 0.7 | |
Property Plant And Equipment At Fair Value | Boehlen Location | ||
Fair Value Measurements | ||
Assets at fair value, nonrecurring | 3.3 | 3.4 |
Interest Rate Swap | ||
Fair Value Measurements | ||
Total net derivative position | (0.7) | (2.2) |
Cross Currency Swap | ||
Fair Value Measurements | ||
Total net derivative position | (11.3) | (17.4) |
Not Designated as Hedging Instruments | Foreign Exchange Forward Contracts | ||
Fair Value Measurements | ||
Total net derivative position | 3.7 | 1 |
Recurring | ||
Fair Value Measurements | ||
Total net derivative position | (8.3) | (18.6) |
Recurring | Interest Rate Swap | ||
Fair Value Measurements | ||
Liabilities at fair value | (0.7) | (2.2) |
Recurring | Cross Currency Swap | ||
Fair Value Measurements | ||
Liabilities at fair value | (11.3) | (17.4) |
Recurring | Level 2 | ||
Fair Value Measurements | ||
Total net derivative position | (8.3) | (18.6) |
Recurring | Level 2 | Interest Rate Swap | ||
Fair Value Measurements | ||
Liabilities at fair value | (0.7) | (2.2) |
Recurring | Level 2 | Cross Currency Swap | ||
Fair Value Measurements | ||
Liabilities at fair value | (11.3) | (17.4) |
Recurring | Not Designated as Hedging Instruments | Foreign Exchange Forward Contracts | ||
Fair Value Measurements | ||
Assets at fair value | 3.8 | 2.2 |
Liabilities at fair value | (0.1) | (1.2) |
Recurring | Not Designated as Hedging Instruments | Level 2 | Foreign Exchange Forward Contracts | ||
Fair Value Measurements | ||
Assets at fair value | 3.8 | 2.2 |
Liabilities at fair value | $ (0.1) | (1.2) |
Nonrecurring | ||
Fair Value Measurements | ||
Assets at fair value, nonrecurring | 0 | |
Liabilities at fair value, nonrecurring | $ 0 |
Fair Value Measurements - Items
Fair Value Measurements - Items not at Fair Value (Details) - Level 2 - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Fair Value of Debt Instruments | ||
Total fair value of long term debt | $ 2,302.3 | $ 2,374.5 |
2029 Senior Notes | ||
Fair Value of Debt Instruments | ||
Total fair value of long term debt | 416.4 | 460.2 |
2028 Term Loan B | ||
Fair Value of Debt Instruments | ||
Total fair value of long term debt | 735.1 | 737.4 |
2025 Senior Notes | ||
Fair Value of Debt Instruments | ||
Total fair value of long term debt | 494.7 | 509.4 |
2024 Term Loan B | ||
Fair Value of Debt Instruments | ||
Total fair value of long term debt | $ 656.1 | $ 667.5 |
Provision For Income Taxes (Det
Provision For Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Provision For Income Taxes | ||
Effective tax rate | 56.90% | 23.40% |
Provision for income taxes | $ 22.6 | $ 20.1 |
Change in valuation allowances | $ 35.6 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | Mar. 31, 2022USD ($)item | Dec. 31, 2021USD ($) |
Commitments and Contingencies. | ||
Accrued obligations for environmental remediation and restoration costs | $ | $ 4.2 | $ 4.4 |
Environmental claims asserted | item | 0 |
Commitments and Contingencies -
Commitments and Contingencies - Purchase Commitments (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Loss Contingencies [Line Items] | |
European Commission investigation | $ 35.6 |
Maximum | |
Loss Contingencies [Line Items] | |
Purchase commitment period | 5 years |
Minimum | |
Loss Contingencies [Line Items] | |
Purchase commitment period | 1 year |
Pension Plans and Other Postr_3
Pension Plans and Other Postretirement Benefits - Net Periodic Benefit Costs (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
U.S. Plans And Non-U.S. Plans | ||
Net periodic benefit cost | ||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Interest Cost, Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Expected Return (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Amortization of Prior Service Cost (Credit), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Amortization of Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Pension plans | Non-U.S. Plans | ||
Net periodic benefit cost | ||
Service cost | $ 3.2 | $ 4.1 |
Interest cost | 0.7 | 0.5 |
Expected return on plan assets | (0.1) | |
Amortization of prior service cost | (0.1) | (0.2) |
Amortization of net (gain) loss | 0.7 | 1.5 |
Net periodic benefit cost | 4.4 | 5.9 |
Pension plans | United States | ||
Net periodic benefit cost | ||
Service cost | 0.2 | |
Interest cost | 0.2 | |
Expected return on plan assets | (0.2) | |
Net periodic benefit cost | 0.2 | |
Pension plans | United States | PMMA Business | ||
Net periodic benefit cost | ||
Net periodic benefit cost | 0 | |
Other Postretirement Benefit Plans | Maximum | ||
Net periodic benefit cost | ||
Net periodic benefit cost | $ 0.1 | $ 0.1 |
Pension Plans and Other Postr_4
Pension Plans and Other Postretirement Benefits - Net Amounts Recognized (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Net amounts recognized in the balance sheets at December 31 | |||
Benefit obligations | $ 271.8 | $ 274.7 | |
Cash contributions and benefit payments to unfunded plans | $ 2.5 | ||
Additional cash contributions, including benefit payments to unfunded plans | $ 6.5 |
Share-Based Compensation - Summ
Share-Based Compensation - Summary of Expense (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | $ 8.3 | $ 3.4 |
Restricted Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 4.6 | 1.7 |
Unrecognized compensation cost | $ 13.6 | |
Weighted-average period of recognition | 2 years 1 month 6 days | |
Option Awards | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | $ 3 | 1.2 |
Unrecognized compensation cost, options | $ 4.2 | |
Weighted-average period of recognition | 1 year 8 months 12 days | |
Performance Share Units | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | $ 0.7 | $ 0.5 |
Unrecognized compensation cost | $ 5.8 | |
Weighted-average period of recognition | 2 years 4 months 24 days |
Share-Based Compensation - RSU
Share-Based Compensation - RSU Options and PSUs (Details) | 3 Months Ended |
Mar. 31, 2022$ / sharesshares | |
Restricted Stock Units | |
Other-than-Options, Shares Activity | |
Granted, Shares | shares | 124,373 |
Other-than-Options, FV Activity | |
Granted, Weighted-Average Grant Date Fair Value per Share | $ 58.64 |
Option Awards | |
Options Outstanding Roll Forward | |
Granted, Options | shares | 185,192 |
Fair Value Assumptions | |
Expected term (in years) | 5 years 6 months |
Expected volatility | 48.84% |
Risk-free interest rate | 1.94% |
Dividend yield | 2.00% |
Options granted, Weighted average grant date fair value | $ 22.71 |
Performance Share Units | |
Fair Value Assumptions | |
Expected term (in years) | 3 years |
Expected volatility | 57.30% |
Risk-free interest rate | 1.73% |
Share Price | $ 58.64 |
Other-than-Options, Shares Activity | |
Granted, Shares | shares | 63,317 |
Other-than-Options, FV Activity | |
Granted, Weighted-Average Grant Date Fair Value per Share | $ 57.47 |
Segments - Reconciliation of Se
Segments - Reconciliation of Segment Reporting to Consolidated (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||
Adjusted EBITDA | $ 204.5 | $ 206.6 | |
Equity in earnings of unconsolidated affiliates | 21.6 | 22.9 | |
Investment in unconsolidated affiliates | 262 | $ 247.8 | |
Capital expenditures | 23.9 | 11.2 | |
Engineered Materials | |||
Segment Reporting Information [Line Items] | |||
Adjusted EBITDA | 34.7 | 7.9 | |
Latex Binders | |||
Segment Reporting Information [Line Items] | |||
Adjusted EBITDA | 30.2 | 16.8 | |
Base Plastics | |||
Segment Reporting Information [Line Items] | |||
Adjusted EBITDA | 68.6 | 65.3 | |
Polystyrene | |||
Segment Reporting Information [Line Items] | |||
Adjusted EBITDA | 45.3 | 47.4 | |
Feedstocks | |||
Segment Reporting Information [Line Items] | |||
Adjusted EBITDA | $ 4.1 | 46.3 | |
Americas Styrenics [Member] | |||
Segment Reporting Information [Line Items] | |||
Percentage of ownership underlying net assets | 50.00% | ||
Adjusted EBITDA | $ 21.6 | $ 22.9 | |
AmSty | |||
Segment Reporting Information [Line Items] | |||
Percentage of ownership underlying net assets | 50.00% | 50.00% | |
Investment in unconsolidated affiliates | $ 262 | $ 247.8 |
Segments - Reconciliation of Ne
Segments - Reconciliation of Net Income to Segment Adjusted EBITDA (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Segment Reporting Information [Line Items] | ||
Income from continuing operations before income taxes | $ 39.7 | $ 85.9 |
Interest expense, net | (21.9) | (12) |
Depreciation and amortization | 53 | 23.1 |
Corporate Unallocated | 26.9 | 22.4 |
Adjusted EBITDA addbacks | 63 | 63.2 |
Adjusted EBITDA | 204.5 | 206.6 |
Net gain on disposition of businesses and assets | (0.3) | (0.2) |
Restructuring and other charges | 0.4 | 0.3 |
Acquisition transactions and integration net costs (benefit) | 3.2 | 6 |
Acquisition purchase price hedge loss (gain) | 55 | |
Asset impairment charges or write-offs | 0.7 | |
European Commission Request for Information (Note 13) | 35.6 | |
Other items | 23.4 | 2.1 |
Corporate Unallocated | ||
Segment Reporting Information [Line Items] | ||
Interest expense, net | $ 21.9 | $ 12 |
Restructuring (Details)
Restructuring (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Charges | $ 0.4 | $ 0.3 |
Restructuring Reserve [Roll Forward] | ||
Accrued charges/Balance at beginning of period | 10 | |
Expenses | 0.2 | |
Deductions | (1.8) | |
Accrued charges/Balance at end of period | 8.4 | |
Transformational Restructuring Program | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Charges | 0.3 | |
Cumulative life-to-date charges | 9 | |
Other Restructurings | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Charges | 0.1 | $ 0.3 |
Employee termination benefits | ||
Restructuring Reserve [Roll Forward] | ||
Accrued charges/Balance at beginning of period | 10 | |
Expenses | 0.1 | |
Deductions | (1.7) | |
Accrued charges/Balance at end of period | 8.4 | |
Employee termination benefits | Transformational Restructuring Program | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Charges | 0.3 | |
Cumulative life-to-date charges | 9 | |
Employee termination benefits | Transformational Restructuring Program | Maximum | ||
Restructuring Cost and Reserve [Line Items] | ||
Expected restructuring charges | 1 | |
Decommissioning and other | ||
Restructuring Reserve [Roll Forward] | ||
Expenses | 0.1 | |
Deductions | $ (0.1) |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Components (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance at beginning of period | $ 1,013.1 | $ 590.3 |
Balance at end of period | 972.8 | 676.3 |
Cumulative Translation Adjustments | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance at beginning of period | (114.3) | (109) |
Other comprehensive income (loss) | (4.3) | 0.4 |
Balance at end of period | (118.6) | (108.6) |
Pension & Other Postretirement Benefit Plans, Net | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance at beginning of period | (33.6) | (71.9) |
Amounts reclassified from AOCI to net income | 0.3 | 1.1 |
Balance at end of period | (33.3) | (70.8) |
Cash Flow Hedges, Net | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance at beginning of period | 0.7 | (5.2) |
Other comprehensive income (loss) | 0.7 | 3.5 |
Amounts reclassified from AOCI to net income | 0.8 | 1.1 |
Balance at end of period | 2.2 | (0.6) |
Total | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance at beginning of period | (147.2) | (186.1) |
Other comprehensive income (loss) | (3.6) | 3.9 |
Amounts reclassified from AOCI to net income | 1.1 | 2.2 |
Balance at end of period | $ (149.7) | $ (180) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) - Reclassification (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Cost of sales | $ 1,210.7 | $ 797.1 |
Interest expense, net | 21.9 | 12 |
Income before income taxes | (39.7) | (85.9) |
Provision for income taxes | 22.6 | 20.1 |
Net income | (16.7) | (71.5) |
Pension & Other Postretirement Benefit Plans, Net | Reclassified from AOCI to net income (loss) | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Income before income taxes | 0.5 | 1.6 |
Provision for income taxes | (0.2) | (0.5) |
Net income | 0.3 | 1.1 |
Accumulated Defined Benefit Plans Adjustment, Net Prior Service Attributable to Parent [Member] | Reclassified from AOCI to net income (loss) | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Prior service credit | (0.1) | (0.2) |
Accumulated Defined Benefit Plans Adjustment, Net Gain (Loss) Attributable to Parent [Member] | Reclassified from AOCI to net income (loss) | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Net actuarial loss | 0.6 | 1.8 |
Cash Flow Hedges, Net | Reclassified from AOCI to net income (loss) | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Cost of sales | 0.3 | |
Interest expense, net | 0.8 | 0.8 |
Income before income taxes | 0.8 | 1.1 |
Net income | $ 0.8 | $ 1.1 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Earnings: | ||
Net income from continuing operations | $ 17.1 | $ 65.8 |
Net income (loss) from discontinued operations, net of income taxes | (0.4) | 5.7 |
Net income | $ 16.7 | $ 71.5 |
Shares: | ||
Weighted average ordinary shares outstanding | 37.3 | 38.5 |
Dilutive effect of RSUs, option awards and PSUs | 0.8 | 1 |
Diluted weighted average ordinary shares outstanding | 38.1 | 39.5 |
Income (loss) per share | ||
Income (loss) per share-basic, Continuing operations | $ 0.46 | $ 1.71 |
Income (loss) per share-basic, Discontinued operations | (0.01) | 0.15 |
Income per share-basic | 0.45 | 1.86 |
Income (loss) per share-diluted, Continuing operations | 0.45 | 1.67 |
Income (loss) per share-diluted, Discontinued operations | (0.01) | 0.14 |
Income per share- diluted | $ 0.44 | $ 1.81 |
Anti-dilutive shares excluded | 0.9 | 0.5 |
Other Charges (Details)
Other Charges (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Other Charges | |
Asset impairmentsimpairment charges or write-offs (Note 11) | $ 0.7 |
European Commission Request for Information (Note 13) | 35.6 |
Total | $ 36.3 |