Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 19, 2019 | Jun. 30, 2018 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | INGEVITY CORPORATION | ||
Entity Central Index Key | 1,653,477 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common stock, shares outstanding | 41,618,887 | ||
Entity Public Float | $ 3,395,178,951 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well- Known Seasoned Issuer | Yes | ||
Emerging Growth Company | false | ||
Small Business Entity | false | ||
Entity Shell Company | false |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Statement [Abstract] | |||
Net sales | $ 1,133.6 | $ 972.4 | $ 908.3 |
Cost of sales | 716.8 | 643.4 | 633.9 |
Gross profit | 416.8 | 329 | 274.4 |
Selling, general and administrative expenses | 132.4 | 106.4 | 96.4 |
Research and technical expenses | 21.5 | 19.8 | 17.6 |
Separation costs | 0 | 0.9 | 17.5 |
Restructuring and other (income) charges, net | (0.5) | 3.7 | 41.2 |
Acquisition-related costs | 10.8 | 7.1 | 0 |
Other (income) expense, net | 1 | 0.5 | (3.2) |
Interest expense | 33.2 | 18.1 | 19.3 |
Interest income | (3.4) | (2.3) | (1.4) |
Income (loss) before income taxes | 221.8 | 174.8 | 87 |
Provision (benefit) for income taxes | 40 | 29.6 | 42.6 |
Net income (loss) | 181.8 | 145.2 | 44.4 |
Less: Net income (loss) attributable to noncontrolling interests | 12.7 | 18.7 | 9.2 |
Net income (loss) attributable to Ingevity stockholders | $ 169.1 | $ 126.5 | $ 35.2 |
Basic and Diluted earnings (loss) per share | |||
Basic earnings (loss) per common share attributable to Ingevity stockholders (in dollars per share) | $ 4.02 | $ 3 | $ 0.83 |
Diluted earnings (loss) per common share attributable to Ingevity stockholders (in dollars per share) | $ 3.97 | $ 2.97 | $ 0.83 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ 181.8 | $ 145.2 | $ 44.4 |
Other comprehensive income (loss), net of tax: | |||
Foreign currency translation adjustment | (6.3) | 8.3 | (2.9) |
Derivative instruments: | |||
Unrealized gain (loss), net of tax provision (benefit) of $0.4, zero, and zero | 1.3 | (0.1) | 0 |
Reclassifications of deferred derivative instruments (gain) loss, included in net income (loss), net of tax (provision) benefit of ($0.3), zero, and $0.6 | (0.9) | 0.1 | 1 |
Total derivative instruments, net of tax provision (benefit) of $0.1, zero, and ($0.6) | 0.4 | 0 | 1 |
Pension & other postretirement benefits | |||
Unrealized actuarial gains (losses) and prior service (costs) credits, net of tax provision (benefit) of $(0.1), $0.4, and $0.3 | (0.3) | (0.7) | (0.6) |
Reclassification included in net income (loss): | |||
Reclassifications of net actuarial and other (gain) loss, amortization of prior service cost, and settlement and curtailment (income) charges, included in net income, net of tax (provision) benefit of ($0.1), zero, and zero | 0.2 | 0 | 0 |
Total pension and other postretirement benefits, net of tax provision (benefit) of zero, $0.4, and $0.3 | (0.1) | (0.7) | (0.6) |
Other comprehensive income (loss), net of tax provision (benefit) of $0.1, $0.4, and ($0.3) | (6) | 7.6 | (2.5) |
Comprehensive income (loss) | 175.8 | 152.8 | 41.9 |
Less: Comprehensive income (loss) attributable to noncontrolling interests | 12.7 | 18.7 | 9.2 |
Comprehensive income (loss) attributable to the Ingevity stockholders | $ 163.1 | $ 134.1 | $ 32.7 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Unrealized tax (benefit) expense | $ 0.4 | $ 0 | $ 0 |
Reclassifications tax expense (benefit) | (0.3) | 0 | 0.6 |
Total derivative instruments tax (benefit) expense | 0.1 | 0 | (0.6) |
Unrealized actuarial gains (losses) and prior service (costs) credits, tax | (0.1) | 0.4 | 0.3 |
Reclassifications of net actuarial and other (gain) loss and amortization of prior service cost, tax | (0.1) | 0 | 0 |
Total pension and other postretirement benefits, tax | 0 | 0.4 | 0.3 |
Other comprehensive income, tax | $ 0.1 | $ 0.4 | $ (0.3) |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||
Cash and cash equivalents | $ 77.5 | $ 87.9 |
Accounts receivable, net of allowance of $0.4 at 2018 and $0.4 at 2017 | 118.9 | 100 |
Inventories, net | 191.4 | 160 |
Prepaid and other current assets | 34.9 | 20.8 |
Current assets | 422.7 | 368.7 |
Property, plant and equipment, net | 523.8 | 438.5 |
Goodwill | 130.7 | 12.4 |
Other intangibles, net | 125.6 | 4.9 |
Deferred income taxes | 2.9 | 3.4 |
Restricted investment | 71.2 | 71.3 |
Other assets | 38.3 | 30.4 |
Total Assets | 1,315.2 | 929.6 |
Liabilities | ||
Accounts payable | 92.9 | 83.1 |
Accrued expenses | 36.7 | 20 |
Accrued payroll and employee benefits | 42 | 39.2 |
Current maturities of long-term debt | 11.2 | 9.4 |
Income taxes payable | 0.5 | 1.5 |
Current liabilities | 183.3 | 153.2 |
Long-term debt including capital lease obligations | 741.2 | 444 |
Deferred income taxes | 36.9 | 41.3 |
Other liabilities | 15.1 | 13.2 |
Total Liabilities | 976.5 | 651.7 |
Commitments and contingencies (Note 19) | ||
Equity | ||
Preferred stock (par value $0.01 per share; 50,000,000 shares authorized; zero issued and outstanding at 2018 and 2017) | 0 | 0 |
Common stock (par value $0.01 per share; 300,000,000 shares authorized; 42,331,913 and 42,208,973 issued and 41,693,261 and 42,089,103 outstanding at 2018 and 2017, respectively) | 0.4 | 0.4 |
Additional paid-in capital | 98.3 | 140.1 |
Retained earnings | 313.5 | 142.8 |
Accumulated other comprehensive (income) loss | (17.7) | (11.7) |
Treasury stock, common stock, at cost (638,652 and 119,870 shares at 2018 and 2017, respectively) | (55.8) | (7.7) |
Total Ingevity stockholders' equity | 338.7 | 263.9 |
Noncontrolling interests | 0 | 14 |
Total Equity | 338.7 | 277.9 |
Total Liabilities and Equity | $ 1,315.2 | $ 929.6 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Allowance for accounts receivable | $ 0.4 | $ 0.4 |
Preferred stock, shares authorized (shares) | 50,000,000 | 50,000,000 |
Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares issued (shares) | 0 | 0 |
Preferred stock, shares outstanding (shares) | 0 | 0 |
Common stock, shares authorized (shares) | 300,000,000 | 300,000,000 |
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares issued (shares) | 42,331,913 | 42,208,973 |
Common stock shares outstanding (shares) | 41,693,261 | 42,089,103 |
Treasury stock, shares | 638,652 | 119,870 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Millions | Total | Common Stock | Net parent investment | Additional paid-in capital | Retained earnings | Accumulated other comprehensive income (loss) | Treasury stock | Noncontrolling interests |
Beginning balance, shares at Dec. 31, 2015 | 0 | |||||||
Beginning balance, value at Dec. 31, 2015 | $ 517.4 | $ 0 | $ 530.1 | $ 0 | $ 0 | $ (16.5) | $ 0 | $ 3.8 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income (loss) | 44.4 | 19.2 | 16 | 9.2 | ||||
Other comprehensive income (loss) before reclassifications | (2.5) | (2.5) | ||||||
Issuance of common stock at separation, shares | 42,101,600 | |||||||
Issuance of common stock at separation, value | 0 | $ 0.4 | (0.4) | |||||
Common stock issued, shares | 14,800 | |||||||
Common stock issued | 0 | |||||||
Tax payments related to vested restricted stock units | (0.3) | (0.3) | ||||||
Cash distributed to WestRock at separation | (448.5) | (448.5) | ||||||
Net transfers to parent | 24.8 | 24.8 | ||||||
Reclassifications from net parent investment to additional paid in capital | 0 | (125.6) | 125.6 | |||||
Noncontrolling interest distributions | (5.4) | (5.4) | ||||||
Share-based compensation plans | 4.7 | 4.7 | ||||||
Ending balance, shares at Dec. 31, 2016 | 42,116,400 | |||||||
Ending balance, value at Dec. 31, 2016 | 134.6 | $ 0.4 | 0 | 129.9 | 16 | (19) | (0.3) | 7.6 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income (loss) | 145.2 | 126.5 | 18.7 | |||||
Other comprehensive income (loss) before reclassifications | 7.6 | 7.6 | ||||||
Common stock issued, shares | 85,900 | |||||||
Common stock issued | $ 0 | |||||||
Exercise of stock options, shares | 7,000 | 6,600 | ||||||
Exercise of stock options, value | $ 0.2 | 0.2 | ||||||
Tax payments related to vested restricted stock units | (1.2) | (1.2) | ||||||
Share repurchase program | (6.6) | (6.6) | ||||||
Noncontrolling interest distributions | (12.3) | (12.3) | ||||||
Share-based compensation plans | $ 10.4 | 10 | 0.4 | |||||
Reclassification of certain deferred tax effects | 0.3 | (0.3) | ||||||
Ending balance, shares at Dec. 31, 2017 | 42,089,103 | 42,208,900 | ||||||
Ending balance, value at Dec. 31, 2017 | $ 277.9 | $ 0.4 | 0 | 140.1 | 142.8 | (11.7) | (7.7) | 14 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income (loss) | 181.8 | 169.1 | 12.7 | |||||
Other comprehensive income (loss) before reclassifications | (6) | (6) | ||||||
Common stock issued, shares | 116,700 | |||||||
Common stock issued | $ 0 | |||||||
Exercise of stock options, shares | 6,000 | 6,300 | ||||||
Exercise of stock options, value | $ 0.2 | 0.2 | ||||||
Tax payments related to vested restricted stock units | (2.5) | (2.5) | ||||||
Share repurchase program | (47.4) | (47.4) | ||||||
Noncontrolling interest distributions | (15.3) | (15.3) | ||||||
Share-based compensation plans | 14.1 | 12.3 | 1.8 | |||||
Acquisition of noncontrolling interest | $ (65.7) | (54.3) | (11.4) | |||||
Ending balance, shares at Dec. 31, 2018 | 41,693,261 | 42,331,900 | ||||||
Ending balance, value at Dec. 31, 2018 | $ 338.7 | $ 0.4 | $ 0 | $ 98.3 | $ 313.5 | $ (17.7) | $ (55.8) | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Cash provided by (used in) operating activities: | ||||
Net income (loss) | $ 181.8 | $ 145.2 | $ 44.4 | |
Adjustments to reconcile net income (loss) to cash provided by operating activities: | ||||
Depreciation and amortization | 57 | 40.4 | 38.8 | |
Deferred income taxes | 0.9 | (25.7) | (7.9) | |
Disposal/impairment of assets | 0.9 | 2.2 | 1.5 | |
Restructuring and other (income) charges, net | (0.5) | 3.7 | 41.2 | |
Share-based compensation | 12.5 | 10.1 | 4.7 | |
Pension and other postretirement benefit costs | 2 | 1.3 | 0.7 | |
Other non-cash items | 15.9 | 7.3 | 4.8 | |
Changes in operating assets and liabilities: | ||||
Accounts receivable, net | (3) | (9.5) | 5.7 | |
Inventories, net | (26.9) | (6.6) | (2.2) | |
Prepaid and other current assets | (6.8) | 6.5 | (3.9) | |
Planned major maintenance outage | (7) | (6.1) | (5.9) | |
Accounts payable | 5.7 | 1.7 | (1.5) | |
Accrued expenses | 13.1 | 1.6 | (1.9) | |
Accrued payroll and employee benefit costs | 3 | 13.4 | 15 | |
Income taxes | 5 | (7.3) | 4.5 | |
Pension contribution | (1.6) | (1.4) | (1) | |
Restructuring and other spending | (0.2) | (5.5) | (8.3) | |
Changes in all other operating assets and liabilities, net | 0.2 | 3 | (0.8) | |
Net cash provided by (used in) operating activities | 252 | 174.3 | 127.9 | |
Cash provided by (used in) investing activities: | ||||
Capital expenditures | (93.9) | (52.6) | (56.7) | |
Payments for acquired businesses, net of cash acquired | (315.5) | 0 | ||
Proceeds from disposition of assets | 0.6 | 0 | 0 | |
Purchase of equity securities | 0 | (2.4) | 0 | |
Sale of equity securities | 1.1 | 1 | 0 | |
Restricted investment | (2) | (1.6) | (69.7) | |
Other investing activities, net | (4.7) | (3) | 0 | |
Net cash provided by (used in) investing activities | (414.4) | (58.6) | (126.4) | |
Cash provided by (used in) financing activities: | ||||
Net borrowings under our revolving credit facility | 0 | (111.9) | 111.9 | |
Proceeds from long-term borrowings | 300 | 75 | 300 | |
Debt issuance costs | (7.1) | (1.3) | (3.6) | |
Borrowings (repayments) of notes payable and other short-term borrowings, net | 3.9 | 0 | (9.4) | |
Tax payments related to withholdings on vested restricted stock units | (2.5) | (1.2) | (0.3) | |
Proceeds and withholdings from share-based compensation plans, net | 2.1 | 0.5 | 0 | |
Repurchases of common stock under publicly announced plan | (47.4) | (6.6) | 0 | |
Noncontrolling interest distributions | (80) | 0 | 0 | |
Noncontrolling interest distributions | (15.3) | (12.3) | (5.4) | |
Cash distributed to WestRock at separation | 0 | 0 | (448.5) | |
Transactions with WestRock, net | 0 | 0 | 51.9 | |
Other financing activities, net | 0 | 0 | 0 | |
Net cash provided by (used in) financing activities | 153.7 | (57.8) | (3.4) | |
Increase (decrease) in cash, cash equivalents, and restricted cash | (8.7) | 57.9 | (1.9) | |
Effect of exchange rate changes on cash | (1.4) | (0.5) | 0.4 | |
Change in cash, cash equivalents, and restricted cash | (10.1) | 57.4 | (1.5) | |
Cash, cash equivalents, and restricted cash at beginning of period | [1] | 87.9 | 30.5 | 32 |
Cash, cash equivalents, and restricted cash at end of period | [1] | 77.8 | 87.9 | 30.5 |
Supplemental cash flow information: | ||||
Cash paid for interest, net of capitalized interest | 26 | 16 | 15.1 | |
Cash paid for income taxes, net of refunds | 34.8 | 61.9 | 22.4 | |
Purchases of property, plant and equipment in accounts payable | $ 8.9 | $ 5.1 | $ 3.7 | |
[1] | Includes restricted cash of $0.3 million, zero and zero and cash and cash equivalents of $77.5 million, $87.9 million and $30.5 million for the periods ended December 31, 2018, 2017 and 2016, respectively. Restricted cash is included within "Prepaid and Other Current Assets" within the consolidated balance sheets. |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Reconciliation)(Parenthetical) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Statement of Cash Flows [Abstract] | |||
Restricted cash | $ 0.3 | $ 0 | $ 0 |
Cash and cash equivalents | $ 77.5 | $ 87.9 | $ 30.5 |
Background
Background | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Background | Background Ingevity Corporation ("Ingevity," "the company", "we," "us" or "our") is a leading global manufacturer of specialty chemicals and high performance activated carbon materials. We provide innovative solutions to meet our customers’ unique and demanding requirements through proprietary formulated products. We report in two business segments: Performance Materials and Performance Chemicals. Our Performance Materials segment consists of our automotive technologies and process purifications product lines. Performance Materials manufactures products in the form of powder, granular, extruded pellets, extruded honeycombs, and activated carbon sheets. Automotive technologies products are sold into the gasoline vapor emission control applications within the automotive industry, while process purifications products are sold into the food, water, beverage, and chemical purification industries. Our Performance Chemicals segment consists of our pavement technologies, oilfield technologies, industrial specialties, and engineered polymers (acquired in 2019; see Note 17 for more information) product lines. Performance Chemicals manufactures products derived from CTO and lignin extracted from the kraft paper making process as well as caprolactone monomers and derivatives derived from cyclohexanone and hydrogen peroxide. Performance Chemicals products serve as critical inputs used in a variety of high performance applications, including pavement preservation, pavement adhesion promotion and warm mix paving (pavement technologies product line), oil well service additives, oil production and downstream application chemicals (oilfield technologies product line), printing inks, adhesives, agrochemicals, lubricants and industrial intermediates (industrial specialties product line), coatings resins, elastomers, adhesives, and bio-plastics (engineered polymers product line). Separation and Distribution On May 15, 2016 (the "Distribution Date"), Ingevity separated from WestRock Company (“WestRock”) (herein referred to as the "Separation"). The Separation was completed pursuant to a Separation and Distribution Agreement and other agreements with WestRock related to the Separation, including an Employee Matters Agreement ("EMA"), a Tax Matters Agreement ("TMA"), a Transition Services Agreement and an Intellectual Property Agreement (collectively, the "Separation Agreements"). The Separation was completed by way of a distribution of all of the then outstanding shares of common stock of Ingevity through a dividend in kind of Ingevity's common stock (par value $0.01 ) to holders of record of WestRock common stock (par value $0.01 ) as of the close of business of May 4, 2016 (the "Record Date"). Ingevity's common stock began "regular-way" trading on the New York Stock Exchange ("NYSE") on May 16, 2016 under the symbol "NGVT". |
Basis of Consolidation and Pres
Basis of Consolidation and Presentation | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Consolidation and Presentation | Basis of Consolidation and Presentation The accompanying Consolidated Financial Statements of Ingevity were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The significant accounting policies described in Note 3, together with the other notes that follow, are an integral part of the Consolidated Financial Statements. Ingevity did not operate as a separate, stand-alone entity for the full period covered by these Consolidated Financial Statements. Our consolidated balance sheet as of December 31, 2018 and 2017 , respectively, and our consolidated statement of operations, comprehensive income (loss), and cash flows for the years ended December 31, 2018 and 2017 , consists of the consolidated balances of Ingevity as prepared on a stand-alone basis. Our consolidated statements of operations, comprehensive income (loss), and cash flows for the year ended December 31, 2016, have been prepared on a “carve out” basis for the period prior to the Separation. Prior to the Separation, Ingevity's operations were included in WestRock's financial results and were comprised of certain WestRock wholly owned legal entities for which Ingevity was the sole business and components of legal entities in which Ingevity operated in conjunction with other WestRock businesses. For periods prior to May 15, 2016, the accompanying Consolidated Financial Statements were prepared from WestRock's historical accounting records and are presented on a stand-alone basis as if the business operations had been conducted independently from WestRock. Prior to May 15, 2016, WestRock's net investments in these operations is shown in lieu of Ingevity stockholder's equity in the Consolidated Financial Statements. The Consolidated Financial Statements include the historical operations, assets and liabilities of the legal entities that are considered to comprise the Ingevity business. In all periods presented within these Consolidated Financial Statements all intercompany accounts and transactions have been eliminated. The Consolidated Financial Statements include the accounts of Ingevity and subsidiaries in which a controlling interest is maintained. If Ingevity's ownership is less than 100 percent, the outside stockholders' interests are shown as noncontrolling interests. In all periods presented within the Consolidated Financial Statements, our noncontrolling interest represents the 30 percent ownership interest held by a third-party U.S. based company in our consolidated Purification Cellutions, LLC legal entity. Purification Cellutions, LLC is the legal entity that owns technology associated with, and manufactures, our extruded honeycomb products within our Performance Materials segment. See Note 12 for information regarding our recent acquisition of the remaining 30 percent interest in Purification Cellutions, LLC on August 1, 2018. For purposes of these Consolidated Financial Statements, the term “WestRock” herein refers to the legacy operations of MeadWestvaco Corporation (“MWV”) and its subsidiaries prior to the July 1, 2015 merger of MWV and Rock-Tenn Company ("Rock-Tenn") (the "Merger") and the combined operations of Rock-Tenn and MWV subsequent to the Merger. References to Ingevity’s historical business and operations refer to the business and operations of the Specialty Chemicals Business of WestRock, or prior to the Merger, MWV, that were transferred to Ingevity in connection with the Separation. All of the allocations and estimates in the Consolidated Financial Statements prior to May 15, 2016 are based on assumptions that management believes are reasonable. The December 31, 2016 Consolidated Financial Statements included herein may not be indicative of the financial position, results of operations and cash flows of Ingevity in the future or if Ingevity had been a separate, stand-alone entity during this period. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Estimates and assumptions: We are required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results are likely to differ from those estimates, but we do not believe such differences will materially affect our financial position, results of operations or cash flows. Cash equivalents: Highly liquid securities with an original maturity of three months or less are considered to be cash equivalents. Accounts receivable and allowance for doubtful accounts: Accounts receivable, net on the consolidated balance sheets are comprised of trade receivable less allowances for doubtful accounts. Trade receivables consist of amounts owed to Ingevity from customer sales and are recorded at the invoiced amounts when revenue is recognized and generally do not bear interest. The allowance for doubtful accounts is our best estimate of the amount of probable loss in the existing accounts receivable. We determine the allowance based on historical write-off experience, current collection trends, and external business factors such as economic factors, including regional bankruptcy rates, and political factors. Past due balances over a specified amount are reviewed individually for collectability. Account balances are charged off against the allowance when it is probable that the receivable will not be recovered. Allowance for doubtful accounts at December 31, 2018 and 2017 , were $0.4 million and $0.4 million , respectively. Concentration of credit risk: The financial instruments that potentially subject Ingevity to concentrations of credit risk are accounts receivable. We limit our credit risk by performing ongoing credit evaluations and, when necessary, requiring letters of credit, guarantees or collateral. We had accounts receivable from our largest customer of $7.1 million and $16.4 million as of December 31, 2018 and 2017 , respectively. Sales to this customer, which are included in the Performance Chemicals segment, were five percent , eight percent , and nine percent of total net sales for the years ended December 31, 2018 , 2017 , and 2016 , respectively. No other customers individually accounted for greater than 10 percent of Ingevity's consolidated net sales. Inventories, net: Inventories are valued at net realizable value. Cost is determined using the last-in, first-out method (“LIFO”) for substantially all raw materials, finished goods and production materials of U.S. manufacturing operations. Cost of all other inventories, including stores and supplies inventories and inventories of non-U.S. manufacturing operations, is determined by the first-in, first-out ("FIFO") or average cost methods. As of December 31, 2018 , approximately 28 percent, 9 percent and 63 percent of our inventories were accounted for under the FIFO, average cost, and LIFO methods, respectively. Elements of cost in inventories include raw materials, direct labor, and manufacturing overhead. Property, plant, and equipment: Owned assets are recorded at cost. Also included in the cost of these assets is interest on funds borrowed during the construction period. When assets are sold, retired or disposed of, their cost and related accumulated depreciation are removed from the consolidated balance sheet and any resulting gain or loss is reflected in cost of sales. Repair and maintenance costs that materially add to the value of the asset or prolong its useful life are capitalized and depreciated based on the extension of the useful life; general costs of maintenance and repairs are charged to expense. Repair and Maintenance Costs: We expense routine repair and maintenance costs as we incur them. We defer expenses incurred during planned major maintenance activities and record these amounts to “Other assets” on our consolidated balance sheet. Deferred amounts are recognized as expense ratably, over the shorter of the estimated interval until the next major maintenance activity or the life of the deferred item. The cash outflows related to these costs are included in operating activities in the consolidated statement of cash flows. The timing of this maintenance can vary by manufacturing plant and has a significant impact on our results of operations in the period performed primarily due to lost production during the maintenance period. Depreciation: The cost of plant and equipment is depreciated, utilizing the straight-line method, over the estimated useful lives of the assets, the majority of which range from 20 to 40 years for buildings and leasehold improvements and 5 to 30 years for machinery and equipment. The following table provides the detail behind the useful lives and proportion of our machinery and equipment (“M&E”) in each useful life category. Percent of Depreciable Life in Years Types of Assets 56 20 Production vessels and kilns, storage tanks, piping 11 15 Control systems, instrumentation, metering equipment 7 25 to 30 Blending equipment, storage tanks, piping, shipping equipment and platforms, safety equipment 19 5 to 10 Production control system equipment and hardware, laboratory testing equipment 3 40 Machinery & equipment support structures and foundations 4 Various Various Impairment of long-lived assets: We periodically evaluate whether current events or circumstances indicate that the carrying value of our long-lived assets, including intangible assets, to be held and used may not be recoverable. If such circumstances are determined to exist, an estimate of undiscounted future cash flows produced by the long-lived asset, or the appropriate grouping of assets, is compared to carrying value to determine whether impairment exists. If an asset is determined to be impaired, the loss is measured based on quoted market prices in active markets, if available. If quoted market prices are not available, the estimate of fair value is based on various valuation techniques, including a discounted value of estimated future cash flows. We report an asset to be disposed of at the lower of its carrying value or its estimated net realizable value. Goodwill and other intangible assets: Goodwill represents the excess of cost of an acquired business over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination. We review the recorded value of goodwill at least annually at October 1, or sooner if events or changes in circumstances indicate that the fair value of a reporting unit is below its carrying value. A reporting unit is the level at which discrete financial information is available and reviewed by business management on a regular basis. An impairment exists when the carrying value of a reporting unit exceeds its fair value. Our reporting units are our operating segments, i.e. Performance Chemicals and Performance Materials. If an indication exists that the fair value of a reporting unit with goodwill is less than its carrying value, a quantitative goodwill impairment test is performed. The fair value of each reporting unit is estimated primarily using an income approach, specifically the discounted cash flow method. The following assumptions are key to the income approach: 1) cash flow and earnings projections; 2) growth rates; 3) discount rates; 4) income tax rates; and, 5) terminal value rates. The factors we considered in developing our estimates and projections for cash flows and earnings include, but are not limited to, the following: (i) macroeconomic conditions; (ii) industry and market considerations; (iii) costs, such as increases in raw materials, labor, or other costs; (iv) our overall financial performance; and, (v) other relevant entity-specific events that impact our reporting units. The discount rate we used represents the weighted average cost of capital for the reporting units, considering the risks and uncertainty inherent in the cash flows of the reporting units and in our internally-developed forecasts. The determination of whether goodwill is impaired involves a significant level of judgment in the assumptions underlying the approach used to determine the estimated fair values of our reporting units. We believe that the assumptions and rates used in our impairment assessment are reasonable; however, these assumptions are judgmental and variations in any assumptions could result in materially different calculations of fair value. We will continue to evaluate goodwill on an annual basis as of October 1, and whenever events or changes in circumstances, such as significant adverse changes in operating results, market conditions, or changes in management’s business strategy indicate that there may be a probable indicator of impairment. It is possible that the assumptions used by management related to the evaluation may change or that actual results may vary significantly from management’s estimates. Other intangible assets are comprised of finite-lived intangible assets consisting primarily of brands: representing trademarks, trade names and know-how, and customer contracts and relationships. Other intangible assets are amortized over their estimated useful lives which range from 5 to 20 years. See Note 9 for additional information. Capitalized software: Capitalized software for internal use is included in "Other assets" on the consolidated balance sheets. Amounts capitalized are presented in "Capital expenditures" on our consolidated statements of cash flow. Capitalized software is amortized using the straight-line over the estimated useful lives ranging from 1 to 10 years. Amortization is recorded to "Costs of sales" on our consolidated statements of operations for software directly used in the production of inventory and "Selling, general and administrative expenses" on our consolidated statements of operations for software used for non-production related activities. Environmental and legal liabilities: Environmental expenditures that increase useful lives of assets are capitalized, while other environmental expenditures are expensed. Liabilities are recorded when remedial efforts are probable and the costs can be reasonably estimated. We recognize a liability for other legal contingencies when a loss is probable and reasonably estimable. Liabilities recorded for claims are limited to pending cases based on Ingevity’s historical experience, consultation with outside counsel and consultation with an actuarial specialist concerning the feasibility of reasonably estimating liabilities associated with claims that may arise in the future. We recognized insurance recoveries when collection is reasonably assured. Third-party fees for legal services are expensed as incurred. Revenue recognition: In May 2014, the FASB issued ASU 2014-09 “Revenue from Contracts with Customers (Topic 606),” which supersedes both the revenue recognition requirement to ASC 605 “Revenue Recognition” and most industry-specific guidance. The core principle of the new standard (ASC 606) is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. An entity must also disclose sufficient information to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative information about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. In 2016 and 2017, the FASB issued several ASUs that provided additional clarity on numerous topics as well as providing technical corrections to ASU 2014-09. We adopted this new standard on January 1, 2018, utilizing the modified retrospective method applied to those contracts, which were not completed as of that date. Results for reporting periods beginning after January 1, 2018, are presented under ASC 606, while prior period amounts are not adjusted and continue to be presented in accordance with our historic accounting under ASC 605. Substantially all our revenue is recognized when products are shipped from our manufacturing and warehousing facilities, which represents the point at which control is transferred to the customer. For certain limited contracts, where we are producing goods with no alternative use and for which we have an enforceable right to payment for performance completed to date, we are recognizing revenue as goods are manufactured, rather than when they are shipped. Sales net of returns and customer incentives are based on the sale of manufactured products. Net sales are recognized when obligations under the terms of a contract with our customer are satisfied; generally, this occurs with the transfer of control of our products. Since Net sales are derived from product sales only, we have disaggregated our net sales by our product lines within each reportable segment. Net sales are measured as the amount of consideration we expect to receive in exchange for transferring goods. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. Sales returns and allowances are not a normal practice in the industry and are not significant. Certain customers may receive cash-based incentives, including discounts and volume rebates, which are accounted for as variable consideration and included in Net sales. Shipping and handling fees billed to customers continue to be included with Net sales. If we pay for the freight and shipping, we recognize the cost when control of the product has transferred to the customer as an expense in Cost of sales in the consolidated statement of operations. Although very rare, from time to time we incur expenses to obtain a sales contract. In these cases, if these costs are for orders that are fulfilled in one year or less, we expense these costs as they are incurred. Because the period between when we transfer a promised good to a customer and when the customer pays for that good will be one year or less, we elect not to adjust the promised amount of consideration for the effects of any financing component, as it is not significant. Cost of sales: Costs primarily consists of the cost of inventory sold and other production related costs. These costs include raw materials, direct labor, manufacturing overhead, packaging costs and maintenance costs. Shipping and handling costs are also recorded to cost of sales. Selling, general and administrative expenses: Costs are expensed as incurred and primarily include employee compensation costs related to sales, and office personnel, office expenses, and other expenses not directly related to our manufacturing operations. Costs also include advertising and promotional costs. Research and technical expenses: Cost are expensed as incurred and primarily include employee compensation, technical equipment costs and material testing and innovation related expenses. Royalty expense: Our Performance Materials and Performance Chemicals segments have licensing agreements with third parties requiring us to pay royalties for certain technologies we use in the manufacturing of our products. Royalty expense is recognized as incurred and recorded to "Cost of sales" on our consolidated statements of operations. Income taxes: We are subject to income taxes in the U.S. and numerous foreign jurisdictions, including China. The provision (benefit) for income taxes includes income taxes paid, currently payable or receivable, and deferred taxes. We follow the liability method of accounting for income taxes in accordance with current accounting standards regarding the accounting for income taxes. Under this method, deferred income taxes are recorded based upon the differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws in effect at the time the underlying assets or liabilities are recovered or settled. The ability to realize deferred tax assets is evaluated through the forecasting of taxable income, historical and projected future operating results, the reversal of existing temporary differences, and the availability of tax planning strategies. Valuation allowances are recognized to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. We do not provide income taxes on undistributed earnings of consolidated foreign subsidiaries as it is our intention that such earnings will remain invested in those companies. See Note 18 for more information. We recognize income tax positions that are more likely than not to be realized and accrue interest related to unrecognized income tax positions, which is included as a component of the provision (benefit) for income taxes on the consolidated statements of operations. Prior to the Separation, activity of our U.S. operations were reported in WestRock’s U.S. consolidated income tax return and certain foreign activity was reported in WestRock tax paying entities in those jurisdictions. Under the TMA, WestRock is responsible for the income tax liabilities associated with all U.S. operations prior to Separation and for the historic operations of certain foreign legal entities retained by WestRock after the Separation. For periods prior to the Separation, the provision (benefit) for income taxes included in the Consolidated Financial Statements, related to domestic and certain foreign operations, was calculated on a separate return basis, as if Ingevity was a separate taxpayer and the resulting current tax receivable or liability, including any liabilities related to uncertain tax positions, was settled with WestRock through equity at Separation. In other foreign taxing jurisdictions, the operations of Ingevity were always conducted in discrete legal entities, each of which files separate tax returns, and all resulting income tax assets and liabilities, including any liabilities related to uncertain tax positions, are reflected in the consolidated balance sheets of Ingevity. Pension and postretirement benefits: Prior to the Separation, the employees of Ingevity were participants in various defined benefit pension and postretirement benefit plans (“the Plans”) sponsored by WestRock and the related assets and liabilities were combined with those related to other WestRock businesses. Expense allocated under the Plans was reported within Cost of sales and Selling, general and administrative expenses in the consolidated statements of operation. Prior to the Separation, the Plans were considered to be part of a multi-employer plan with the other businesses of WestRock. In conjunction with the Separation, the employees of Ingevity stopped participating in WestRock pension and post-retirement benefit plans. We assumed certain domestic and international pension and other post retirement benefit obligations from WestRock on the date of Separation. We established new qualified and non-qualified benefit plans to continue the pension and postretirement benefits provided to its employees and retirees based on the obligations assumed from WestRock. The expense related to the current employees of Ingevity as well as the expense related to retirees of Ingevity are included in the Consolidated Financial Statements. The costs (or benefits) and obligations related to these benefits reflect key assumptions related to general economic conditions, including interest (discount) rates, healthcare cost trend rates and expected return on plan assets. The costs (or benefits) and obligations for these benefit programs are also affected by other assumptions, such as average retirement age, mortality, employee turnover, and plan participation. To the extent our plans' actual experience, as influenced by changing economic and financial market conditions or by changes to our own plans' demographics, differs from these assumptions, the costs and obligations for providing these benefits, as well as the plans' funding requirements, could increase or decrease. When actual results differ from our assumptions, the difference is typically recognized over future periods. In addition, the unrealized gains and losses related to our pension and postretirement benefit obligations may also affect periodic benefit costs (or benefits) in future periods. See Note 14 for additional information. Share-based compensation: We recognize compensation expense in our Consolidated Financial Statements for all share-based compensation arrangements. Share-based compensation cost is measured at the date of grant, based on the fair value of the award and expense is recognized over the grantee's requisite service period; forfeitures are recognized as they occur. We calculate the fair value of our stock options using the Black-Scholes option pricing model. The fair value of restricted stock units ("RSU"s), non-employee director deferred stock units ("DSU"s) and performance-based restricted stock units ("PSU"s) is determined using our closing stock price on the day of the grant. Substantially all compensation expense related to share-based awards is recorded as a component of Selling, general and administrative expenses in the Consolidated Statements of Operations. See Note 11 for additional information. Operating segments: Ingevity’s operating segments are Performance Materials and Performance Chemicals. Our operating segments were determined based upon the nature of the products produced, the nature of the production process, the type of customer for the products, the similarity of economic characteristics, and the manner in which management reviews results. Ingevity’s chief operating decision maker evaluates the business at the segment level when making decisions about allocating resources and assessing performance of Ingevity as a whole. We evaluate sales in a format consistent with our reportable segments: (1) Performance Materials, which includes wood-based, chemically activated carbon products and (2) Performance Chemicals, which includes specialty pine-based chemical co-products derived from the kraft pulping process and caprolactone monomers and derivatives derived from cyclohexanone and hydrogen peroxide. Each segment operates as a portfolio of various end uses for the relevant raw material used in that segment. Business decisions are made and performance is generally measured based upon the total mix of end uses each raw material is being directed at in the segment. See Note 20 for additional information. Derivative financial instruments: We mitigate certain financial exposures, including currency risk and commodity price exposures, through a controlled program of risk management that includes the use of derivative financial instruments. We formally document all relationships between the derivative financial instrument and hedged item, as well as the risk management objective and strategy for undertaking various hedge transactions. This process includes relating derivative financial instruments that are designated as cash flow hedges to specific forecasted transactions. We do not hold or issue derivative financial instruments for speculative or trading purposes. We enter into derivative financial instruments which are governed by policies, procedures and internal processes set forth by our Board of Directors. On the date the derivative financial instrument is entered into, we generally designate the derivative as a hedge of the variability of cash flows to be received or paid related to a forecasted transaction (cash flow hedge). Cash flow hedges are derivative financial instruments designated as and used to hedge the exposure to variability in expected future cash flows that are attributable to a particular risk. The derivative financial instruments that are designated and qualify as a cash flow hedge are recorded on the balance sheet at fair value and the changes in fair value of these hedging instruments are offset in part or in whole by corresponding changes in the anticipated cash flows of the underlying exposures being hedged. Where we have a legal right to offset derivative settlements under a master netting agreement with a counterparty, derivatives with that counterparty are presented on a net basis. The gains and losses arising from qualifying hedging instruments are reported as a component of accumulated other comprehensive income (loss) (“AOCI”) located in the consolidated balance sheets and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The reclassification gain or losses of the hedge from AOCI are recorded in the same financial statement caption on the consolidated statements of operations as the hedged item. For example, designated cash flow hedges entered to minimize foreign currency exchange risk of forecasted revenue transactions are recorded to "Net sales" on the consolidated statement of operations when the forecasted transaction occurs. Designated commodity cash flow hedges gains or losses recorded in AOCI are recognized in "Cost of sales" on the consolidated statements of operations when the inventory is sold. See Note 6 for more information regarding our derivative financial instruments. Noncontrolling interests: When our ownership in a consolidated legal entity is less than 100 percent, the outside stockholders' interests are shown as noncontrolling interests. Our noncontrolling interests for the years ended December 31, 2018 , 2017 and 2016 , represents the 30 percent ownership interest held by a third-party U.S. based company in our consolidated Purification Cellutions, LLC legal entity. Purification Cellutions, LLC is the legal entity that owns technology associated with, and manufactures, our extruded honeycomb scrubber products within our Performance Materials segment. Net income (loss) attributable to noncontrolling interest, as presented on our consolidated statement of operations represents 30 percent of the pre-tax earnings from Purification Cellutions, LLC owned by the third-party. Purification Cellutions, LLC is a limited liability company which is treated as a "pass-through" entity for tax purposes. Although we consolidated 100 percent of Purification Cellutions, LLC, only 70 percent of Purification Cellutions, LLC's earnings are included in the calculation of Ingevity's provision for income taxes as presented on the consolidated statement of operations. See Note 12 for information regarding our recent acquisition of the remaining 30 percent interest in Purification Cellutions, LLC on August 1, 2018. Treasury Stock: We record shares of common stock repurchased at cost as treasury stock, resulting in a reduction of stockholders’ equity in the consolidated balance sheets. When the treasury shares are contributed under our employee benefit plans or issued for option exercises, we use a first-in, first-out (“FIFO”) method for determining cost. The difference between the cost of the shares and the market price at the time of contribution to an employee benefit plan is added to or deducted from the related capital in excess of par value of common stock. Translation of foreign currencies: The local currency is the functional currency for all of Ingevity’s significant operations outside the U.S. The assets and liabilities of Ingevity's foreign subsidiaries are translated into U.S. dollars using period-end exchange rates, and adjustments resulting from these financial statement translations are included in accumulated other comprehensive income in the consolidated balance sheets. Revenues and expenses are translated at average rates prevailing during each period. Business Combinations: We account for business combinations in accordance with ASC 805 “Business Combinations” which requires, among other things, the acquiring entity in a business combination to recognize the fair value of the assets acquired and liabilities assumed; the recognition of acquisition-related costs in the consolidated results of operations; the recognition of restructuring costs in the consolidated results of operations for which the acquirer becomes obligated after the acquisition date; and contingent purchase consideration to be recognized at fair value on the acquisition date with subsequent adjustments recognized in the consolidated results of operations. We generally use third-party qualified consultants to assist management in determination of the fair value of assets acquired and liabilities assumed. This includes, when necessary, assistance with the determination of lives and valuation of property and identifiable intangibles, assisting management in determining the fair value of obligations associated with employee related liabilities and assisting management in assessing obligations associated with legal and environmental claims. The fair values assigned to identifiable intangible assets acquired are determined primarily by using an income approach, which is based on assumptions and estimates made by management. Significant assumptions utilized in the income approach are the attrition rate, growth rates and discount rate. These assumptions are based on company specific information and projections, which are not observable in the market and are therefore considered Level 2 and Level 3 measurements. The excess of the purchase price over the fair value of the identified assets and liabilities is recorded as goodwill. Based on the acquired business’ end markets and products as well as how the chief operating decision maker will review the business results determines the most appropriate operating segment for which to integrate the acquired business. Goodwill acquired, if any, is allocated to the reporting unit within or at the operating segment for which the acquired business will be integrated. Operating results of the acquired entity are reflected in the consolidated financial statements from date of acquisition. Relationship with WestRock: Prior to the Separation, the December 31, 2016 Consolidated Financial Statements included allocated expenses associated with centralized WestRock support functions including legal, accounting, tax, treasury, internal audit, information technology, human resources, and other services. The costs associated with these functions generally include all payroll and benefit costs as well as related overhead costs. Prior to the Separation, the Consolidated Financial Statements also include allocated costs associated with WestRock’s office facilities, corporate insurance coverage and medical, pension, post-retirement and other health plan costs attributed to Ingevity’s employees participating in WestRock’s sponsored plans. Allocations are generally based on a number of utilization measures including employee count and proportionate effort. In situations in which determinations based on utilization are impracticable, WestRock and Ingevity used other methods and criteria such as net sales which are believed to result in reasonable estimates of costs attributable to Ingevity. Such allocated expenses are components of net income in the consolidated statement of operations and are therefore included as a component of net cash provided by (or used in) operating activities in the consolidated statement of cash flows. All such amounts have been assumed to have been immediately settled by Ingevity to WestRock in the period in which the costs were recorded in the Consolidated Financial Statements. We believe the related-party allocations included in the Consolidated Financial Statements for periods prior to the Separation have been made on a reasonable basis. However, these Consolidated Financial Statements may not necessarily be indicative of the results of operations that would have been obtained if Ingevity had operated as a separate entity during the periods presented prior to May 15, 2016. Actual costs that may have been incurred if Ingevity had been a stand-alone business would depend on a number of factors, including organizational structure and what functions were outsourced or performed by employees, as well as strategic decisions made in areas such as information technology and infrastructure. Consequently, Ingevity’s future earnings while operated as an independent business could include items of income and expense that are materially different from what is included in the consolidated statements of operations prior to the S |
New Accounting Guidance
New Accounting Guidance | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
New Accounting Guidance | New Accounting Guidance In November 2018, the FASB issued ASU 2018-18 "Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606." This ASU provides guidance on whether certain transactions between collaborative arrangement participants should be accounted for with revenue under Topic 606. In addition, the amendments in this ASU provide more comparability in the presentation of revenue for certain transactions between collaborative arrangement participants. The new standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The amendments should be applied retrospectively to the date of initial application of Topic 606. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In October 2018, the FASB issued ASU 2018-16 "Derivatives and Hedging (Topic 815): Inclusion of Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes." The amendments in this ASU permit use of the OIS rate based on SOFR as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815 in addition to the UST, the LIBOR swap rate, the OIS rate based on the Fed Funds Effective Rate, and the SIFMA Municipal Swap Rate. For entities that have not already adopted Update 2017-12, the amendments in this ASU are required to be adopted concurrently with the amendments in ASU 2017-12. This new standard will be effective for Ingevity for fiscal years beginning after December 15, 2018, since we adopted ASU 2017-12 prior to this guidance. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In August 2018, the FASB issued ASU 2018-15 "Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract." This ASU requires companies to defer specific implementation costs incurred in a Cloud Computing Arrangement ("CCA") that are often expensed as incurred under current GAAP, and recognize the expense over the noncancellable term of the CCA. The new standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In August 2018, the FASB issued ASU 2018-14 "Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20) Disclosure Framework-Changes to the Disclosure Requirements for the Defined Benefit Plans." This ASU modifies and clarifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The new standard is effective for fiscal years ending after December 15, 2020. An entity should apply the amendments in this ASU on a retrospective basis to all periods presented. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In August 2018, the FASB issued ASU 2018-13 "Fair Value Measurement (Topic 820) Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement." This ASU eliminates, amends, and adds disclosure requirements for fair value measurements. The new standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In June 2018, the FASB issued ASU 2018-07 "Compensation-Stock Compensation (Topic 718) - Improvements to Nonemployee Share-Based Payment Accounting." This ASU provides for a single accounting model for all share-based payments, with the employee based guidance now applying to nonemployee share-based transactions. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In January 2017, the FASB issued ASU 2017-04 "Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment," which amends and simplifies the accounting standard for goodwill impairment. The new standard removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount a reporting unit’s carrying value exceeds its fair value, limited to the total amount of goodwill allocated to that reporting unit. The new standard is effective for annual and any interim impairment tests for periods beginning after December 15, 2019. The Company early adopted this standard on January 1, 2018. The impact of adoption did not have a material impact on our Consolidated Financial Statements and related disclosures. In January 2017, the FASB issued ASU No. 2017-01 "Business Combinations (Topic 805): Clarifying the Definition of a Business." The new guidance narrows the existing definition of a business and provides a framework for evaluating whether a transaction should be accounted for as an acquisition (or disposal) of assets or a business. The guidance requires an entity to evaluate if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets; if so, the set of transferred assets and activities (collectively, the "set") is not a business. To be considered a business, the set would need to include an input and a substantive process that together significantly contribute to the ability to create outputs, as defined by the ASU. The guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods, and should be applied prospectively. We adopted this standard on January 1, 2018. In August 2016, the FASB issued final amendments to clarify how entities should classify certain cash receipts and cash payments in ASU 2016-15 "Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments." The new guidance clarifies the classification on the statement of cash flows of certain cash receipts and disbursements such as distributions received from equity method investees, proceeds from settlement of insurance claims, and proceeds from the settlement of corporate-owned life insurance policies. The new standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those years. The Company adopted this standard on January 1, 2018. The impact of adoption did not have a material impact on our Consolidated Financial Statements and related disclosures. In February 2016, the FASB issued ASU 2016-02 "Leases (Topic 842)." Under the new guidance, lessees will be required to recognize for all leases (with the exception of short-term leases) a lease liability, which is a lessee's obligation to make lease payments arising from a lease, measured on a discounted basis and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Since the issuance of ASU 2016-02, the FASB has issued several amendments which clarify certain points in Topic 842, including ASU 2018-20 ("Lease (Topic 842): Narrow-Scope Improvements for Lessors"), ASU 2018-01 ("Land Easement Practical Expedient"), ASU 2018-10 ("Codification Improvements"), and ASU 2018-11 ("Targeted Improvements"). We adopted all of these standards at the same time effective January 1, 2019 under the modified retrospective approach. We utilized the practical expedients upon transition that will retain lease classification and initial direct costs for any leases that existed prior to adoption of the standard; we adopted the practical expedient to apply hindsight in determining lease term; we have chosen to account for lease and nonlease components together as a single lease component; we have elected the practical expedient related to land easements allowing us to carryforward our current accounting treatment for land easements on existing agreements; and we have elected not to restate the comparative financial statements upon adoption. As a lessee, the majority of our leases under existing guidance are classified as operating leases, and therefore, are not recorded on the balance sheet but are recorded in the statement of earnings as expense as incurred. We have catalogued our existing lease contracts and implemented changes to our systems in order to perform the lease accounting and reporting under the new guidance going forward. The adoption of the standard will result in the recognition of additional net lease assets of approximately $60 million to $70 million , with the offset recorded to lease liabilities, as of January 1, 2019. The capital leases discussed in Note 8 to the Consolidated Financial Statements are expected to be accounted for as finance leases upon adoption of Topic 842. There will not be a significant impact in the timing of expense recognition based on the classification of leases as either operating or financing. In May 2014, the FASB issued ASU 2014-09 which is codified in ASC 606 “Revenue from Contracts with Customers” and supersedes both the revenue recognition requirement to ASC 605 “Revenue Recognition” and most industry-specific guidance ("ASC 606"). The core principle of ASC 606 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. An entity must also disclose sufficient information to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative information about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. In 2016 and 2017, the FASB issued several ASUs that provided additional clarity on numerous topics as well as providing technical corrections to the original ASU 2014-09. We adopted this new standard on January 1, 2018, utilizing the modified retrospective method applied to those contracts that were not completed as of January 1, 2018. See below for the effect of this adoption on our Consolidated Financial Statements. In millions Balance at December 31, 2017 Adjustments Balance at January 1, 2018 Assets Accounts receivable, net of allowance $ 100.0 $ 0.3 $ 100.3 Inventories, net 160.0 (2.4 ) 157.6 Prepaid and other current assets 20.8 5.1 25.9 Liabilities Accrued expenses 20.0 0.9 20.9 Deferred income taxes 41.3 0.5 41.8 Equity Retained earnings $ 142.8 $ 1.6 $ 144.4 In accordance with ASC 606, the impact of adoption on our consolidated statement of operations and balance sheet were as follows: Year Ended December 31, 2018 In millions As reported Balances without Adoption of ASC 606 Effect of Change Higher/(Lower) Net sales $ 1,133.6 $ 1,133.0 $ 0.6 Cost of sales 716.8 717.1 (0.3 ) Provision (benefit) for income taxes 40.0 39.8 0.2 Net income (loss) $ 169.1 $ 168.4 $ 0.7 December 31, 2018 In millions As reported Balances without Adoption of ASC 606 Effect of Change Higher/(Lower) Assets Accounts receivable, net of allowance $ 118.9 $ 118.5 $ 0.4 Inventories, net 191.4 193.6 (2.2 ) Prepaid and other current assets 34.9 29.2 5.7 Liabilities — Accrued expenses 36.7 35.7 1.0 Deferred income taxes 36.9 36.7 0.2 Equity Retained earnings $ 313.5 $ 310.8 $ 2.7 All other issued but not yet effective accounting pronouncements are not expected to have a material impact on our Consolidated Financial Statements. New Accounting Guidance In November 2018, the FASB issued ASU 2018-18 "Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606." This ASU provides guidance on whether certain transactions between collaborative arrangement participants should be accounted for with revenue under Topic 606. In addition, the amendments in this ASU provide more comparability in the presentation of revenue for certain transactions between collaborative arrangement participants. The new standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The amendments should be applied retrospectively to the date of initial application of Topic 606. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In October 2018, the FASB issued ASU 2018-16 "Derivatives and Hedging (Topic 815): Inclusion of Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes." The amendments in this ASU permit use of the OIS rate based on SOFR as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815 in addition to the UST, the LIBOR swap rate, the OIS rate based on the Fed Funds Effective Rate, and the SIFMA Municipal Swap Rate. For entities that have not already adopted Update 2017-12, the amendments in this ASU are required to be adopted concurrently with the amendments in ASU 2017-12. This new standard will be effective for Ingevity for fiscal years beginning after December 15, 2018, since we adopted ASU 2017-12 prior to this guidance. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In August 2018, the FASB issued ASU 2018-15 "Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract." This ASU requires companies to defer specific implementation costs incurred in a Cloud Computing Arrangement ("CCA") that are often expensed as incurred under current GAAP, and recognize the expense over the noncancellable term of the CCA. The new standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In August 2018, the FASB issued ASU 2018-14 "Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20) Disclosure Framework-Changes to the Disclosure Requirements for the Defined Benefit Plans." This ASU modifies and clarifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The new standard is effective for fiscal years ending after December 15, 2020. An entity should apply the amendments in this ASU on a retrospective basis to all periods presented. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In August 2018, the FASB issued ASU 2018-13 "Fair Value Measurement (Topic 820) Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement." This ASU eliminates, amends, and adds disclosure requirements for fair value measurements. The new standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In June 2018, the FASB issued ASU 2018-07 "Compensation-Stock Compensation (Topic 718) - Improvements to Nonemployee Share-Based Payment Accounting." This ASU provides for a single accounting model for all share-based payments, with the employee based guidance now applying to nonemployee share-based transactions. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Although we are still evaluating the impact of this new standard, we do not believe that the adoption will materially impact our Consolidated Financial Statements and related disclosures. In January 2017, the FASB issued ASU 2017-04 "Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment," which amends and simplifies the accounting standard for goodwill impairment. The new standard removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount a reporting unit’s carrying value exceeds its fair value, limited to the total amount of goodwill allocated to that reporting unit. The new standard is effective for annual and any interim impairment tests for periods beginning after December 15, 2019. The Company early adopted this standard on January 1, 2018. The impact of adoption did not have a material impact on our Consolidated Financial Statements and related disclosures. In January 2017, the FASB issued ASU No. 2017-01 "Business Combinations (Topic 805): Clarifying the Definition of a Business." The new guidance narrows the existing definition of a business and provides a framework for evaluating whether a transaction should be accounted for as an acquisition (or disposal) of assets or a business. The guidance requires an entity to evaluate if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets; if so, the set of transferred assets and activities (collectively, the "set") is not a business. To be considered a business, the set would need to include an input and a substantive process that together significantly contribute to the ability to create outputs, as defined by the ASU. The guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods, and should be applied prospectively. We adopted this standard on January 1, 2018. In August 2016, the FASB issued final amendments to clarify how entities should classify certain cash receipts and cash payments in ASU 2016-15 "Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments." The new guidance clarifies the classification on the statement of cash flows of certain cash receipts and disbursements such as distributions received from equity method investees, proceeds from settlement of insurance claims, and proceeds from the settlement of corporate-owned life insurance policies. The new standard is effective for fiscal years beginning after December 15, 2017, including interim periods within those years. The Company adopted this standard on January 1, 2018. The impact of adoption did not have a material impact on our Consolidated Financial Statements and related disclosures. In February 2016, the FASB issued ASU 2016-02 "Leases (Topic 842)." Under the new guidance, lessees will be required to recognize for all leases (with the exception of short-term leases) a lease liability, which is a lessee's obligation to make lease payments arising from a lease, measured on a discounted basis and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Since the issuance of ASU 2016-02, the FASB has issued several amendments which clarify certain points in Topic 842, including ASU 2018-20 ("Lease (Topic 842): Narrow-Scope Improvements for Lessors"), ASU 2018-01 ("Land Easement Practical Expedient"), ASU 2018-10 ("Codification Improvements"), and ASU 2018-11 ("Targeted Improvements"). We adopted all of these standards at the same time effective January 1, 2019 under the modified retrospective approach. We utilized the practical expedients upon transition that will retain lease classification and initial direct costs for any leases that existed prior to adoption of the standard; we adopted the practical expedient to apply hindsight in determining lease term; we have chosen to account for lease and nonlease components together as a single lease component; we have elected the practical expedient related to land easements allowing us to carryforward our current accounting treatment for land easements on existing agreements; and we have elected not to restate the comparative financial statements upon adoption. As a lessee, the majority of our leases under existing guidance are classified as operating leases, and therefore, are not recorded on the balance sheet but are recorded in the statement of earnings as expense as incurred. We have catalogued our existing lease contracts and implemented changes to our systems in order to perform the lease accounting and reporting under the new guidance going forward. The adoption of the standard will result in the recognition of additional net lease assets of approximately $60 million to $70 million , with the offset recorded to lease liabilities, as of January 1, 2019. The capital leases discussed in Note 8 to the Consolidated Financial Statements are expected to be accounted for as finance leases upon adoption of Topic 842. There will not be a significant impact in the timing of expense recognition based on the classification of leases as either operating or financing. In May 2014, the FASB issued ASU 2014-09 which is codified in ASC 606 “Revenue from Contracts with Customers” and supersedes both the revenue recognition requirement to ASC 605 “Revenue Recognition” and most industry-specific guidance ("ASC 606"). The core principle of ASC 606 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. An entity must also disclose sufficient information to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative information about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. In 2016 and 2017, the FASB issued several ASUs that provided additional clarity on numerous topics as well as providing technical corrections to the original ASU 2014-09. |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues On January 1, 2018, we adopted ASC 606 using the modified retrospective method applied to contracts not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under ASC 606, while prior period amounts are not adjusted and continue to be reported in accordance with our historic accounting under ASC 605. See Note 4 for more information on the adoption of ASC 606 and its impact on our Consolidated Financial Statements. Ingevity's operating segments are (i) Performance Materials and (ii) Performance Chemicals. A description of both operating segments is included in Note 1. Net sales in both of our reportable segments are based on the sale of manufactured products. Net sales are recognized when obligations under the terms of a contract with our customer are satisfied; generally, this occurs with the transfer of control of our products. Since net sales are derived from product sales only, we have disaggregated our net sales by our product lines within each reportable segment. Net sales are measured as the amount of consideration we expect to receive in exchange for transferring goods. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. Sales returns and allowances are not a normal practice in the industry and are not significant. Shipping and handling fees billed to customers continue to be included with Net sales. Certain customers may receive cash-based incentives, including discounts and volume rebates, which are accounted for as variable consideration and included in Net sales. Incidental items immaterial in the context of the contract are recognized as expense. If we pay for the freight and shipping, we recognize the cost when control of the product has transferred to the customer as an expense in Cost of sales on the consolidated statement of operations. Although very rare, from time to time we incur expenses to obtain a sales contract. In these cases, if these costs are for orders that are fulfilled in one year or less, we expense these costs as they are incurred. Because the period between when we transfer a contracted good to a customer and when the customer pays for that good will be one year or less, we elect not to adjust the contracted amount of consideration for the effects of any significant financing component. Disaggregation of Revenue The following tables present our Net sales disaggregated by product line and geography. Years Ended December 31, In millions 2018 2017 2016 Automotive Technologies product line $ 362.0 $ 312.5 $ 263.5 Process Purification product line 38.4 36.8 37.5 Performance Materials segment $ 400.4 $ 349.3 $ 301.0 Pavement Technologies product line 178.5 163.0 148.8 Oilfield Technologies product line 114.2 77.8 58.5 Industrial Specialties product line 440.5 382.3 400.0 Performance Chemicals segment $ 733.2 $ 623.1 $ 607.3 Consolidated Net sales $ 1,133.6 $ 972.4 $ 908.3 The following table presents our Net sales disaggregated by geography, based on the delivery address of our customer. Years Ended December 31, In millions 2018 2017 2016 North America $ 770.4 $ 662.9 $ 597.8 Asia Pacific 171.4 142.5 138.8 Europe, Middle East and Africa 169.9 149.2 151.1 South America 21.9 17.8 20.6 Net sales $ 1,133.6 $ 972.4 $ 908.3 Contract Balances The following table provides information about contract assets and contract liabilities from contracts with customers. The contract assets primarily relate to our rights to consideration for products produced but not billed at the reporting date on contracts with certain customers. The contract assets are recognized as accounts receivables when the rights become unconditional and the customer has been billed. Contract liabilities represent obligations to transfer goods to a customer for which we have received consideration from our customer. For all periods presented, we had no contract liabilities. In millions Contract Asset Balance at January 1, 2018 $ 4.4 Contract asset additions 26.6 Reclassification to accounts receivable, billed to customers (25.9 ) Balance at December 31, 2018 (1) $ 5.1 _______________ (1) Included within "Prepaid and other current assets" on the consolidated balance sheet. |
Financial Instruments, Risk Man
Financial Instruments, Risk Management, and Fair Value Measurements | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments, Risk Management, and Fair Value Measurements | Financial Instruments, Risk Management, and Fair Value Measurements Financial Instruments and Risk Management Ingevity’s operations are exposed to market risks, such as changes in foreign currency exchange rates and commodity prices due to transactions denominated in a variety of foreign currencies and purchases of certain commoditized raw materials and inputs. Changes in these rates and prices may have an impact on Ingevity’s future cash flow and earnings. To mitigate these market risks and their effects, we enter into derivative financial instruments which are governed by policies, procedures and internal processes set forth by our Board of Directors. Our risk management program also addresses counterparty credit risk by selecting only major financial institutions with investment grade ratings. Once the derivative financial instrument is entered into, we continuously monitor the financial institutions’ credit ratings and our credit risk exposure held by the financial institution. When appropriate, we reallocate exposures across multiple financial institutions to limit credit risk. If a counterparty fails to fulfill its performance obligations under the derivative financial instrument, then Ingevity is exposed to credit risk equal to the fair value of the financial instrument. Derivative assets and liabilities are reported on a net basis by counterparty, to the extent governed by master netting agreements, in the consolidated balance sheets. Due to our proactive mitigation of these potential credit risks, we anticipate performance by our counterparties to these contracts and therefore no material loss is expected. Foreign Currency Exchange Risk Management We manufacture and sell our products in several countries throughout the world and, thus, we are exposed to changes in foreign currency exchange rates. To manage the volatility relating to these exposures, we net the exposures on a consolidated basis to take advantage of natural offsets. To manage the remaining exposure, from time to time, we utilize forward currency exchange contracts and zero cost collar option contracts to minimize the volatility to earnings and cash flows resulting from the effect of fluctuating foreign currency exchange rates on export sales denominated in foreign currencies (principally the euro). These contracts are generally designated as cash flow hedges. We began our foreign currency exchange risk hedging program in July 2017 and therefore prior to this date we had no derivative financial instruments designated to foreign currency exchange risk. As of December 31, 2018 , open foreign currency derivative contracts hedge forecasted transactions until January 2019. These open derivative contracts hedge the notional U.S. dollar equivalent value of approximately $1.9 million . The fair value of the foreign currency hedge was a $0.2 million asset and zero at December 31, 2018 and December 31, 2017 , respectively. Commodity Price Risk Management Certain energy sources used in our manufacturing operations are subject to price volatility caused by weather, supply and demand conditions, economic variables, and other unpredictable factors. This volatility is primarily related to the market pricing of natural gas. To mitigate expected fluctuations in market prices and the volatility to earnings and cash flow resulting from changes to pricing of natural gas purchases, from time to time, we will enter into swap contracts and zero cost collar option contracts and designate these contracts as cash flow hedges. We began our commodity price risk hedging program in December 2017 and therefore prior to this date we had no derivative financial instruments designated to hedge commodity price risk. As of December 31, 2018 , we had 1.8 million and 1.4 million mmBTUS (millions of British Thermal Units) in aggregate notional volume of outstanding natural gas commodity swap contracts and zero cost collar option contracts, respectively, designated as cash flow hedges. As of December 31, 2018 , open commodity contracts hedge forecasted transactions until May 2020. The fair value of the outstanding designated natural gas commodity hedge contracts was zero as of December 31, 2018 and December 31, 2017 , respectively. Equity Securities Our investments in equity securities with a readily determinable fair value totaled $0.4 million and $1.8 million at December 31, 2018 and December 31, 2017 , respectively. The net realized gain/(loss) recognized during the twelve months ended December 31, 2018 and 2017 was zero . The net unrealized gain/(loss) as of December 31, 2018 and 2017 was $(0.3) million and $0.3 million , respectively. The aggregate carrying value of investments in equity securities where fair value is not readily determinable totaled $1.5 million as of December 31, 2018 and $3.0 million as of December 31, 2017. During the twelve months ended December 31, 2018, we recorded an impairment charge of $1.5 million to an equity security, with an original value of $3.0 million , where fair value is not readily determinable held within our Performance Materials segment. The charge was based on recently updated expected future cash flow projections for the investment. Fair-Value Measurements We have categorized our assets and liabilities that are recorded at fair value, based on the priority of the inputs to the valuation technique, into a three-level fair-value hierarchy. The fair-value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure the assets and liabilities fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair-value measurement of the instrument. The following information is presented for assets and liabilities that are recorded in the consolidated balance sheets at fair value measured on a recurring basis. There were no significant transfers of assets and liabilities that are recorded at fair value between Level 1 and Level 2 during the period reported. In millions Level 1 (1) Level 2 (2) Level 3 (3) Total December 31, 2018 Assets: Equity securities (4) $ 0.4 $ — $ — $ 0.4 Foreign currency hedging (4) — 0.2 — 0.2 Commodity hedging (4) — 0.1 — 0.1 Deferred compensation plan investments (5) 1.3 — — 1.3 Total assets $ 1.7 $ 0.3 $ — 2.0 Liabilities: — Deferred compensation arrangement (5) $ 4.6 $ — $ — $ 4.6 Separation-related reimbursement awards (6)(7) 0.1 — — 0.1 Foreign currency hedging (6) — 3.9 — 3.9 Commodity hedging (6) — 0.1 — 0.1 Total liabilities $ 4.7 $ 4.0 $ — $ 8.7 In millions Level 1 (1) Level 2 (2) Level 3 (3) Total December 31, 2017 Assets: Equity securities (4) $ 1.8 $ — $ — $ 1.8 Total assets $ 1.8 $ — $ — 1.8 Liabilities: — Deferred compensation arrangement (5)(8) $ 2.0 $ — $ — $ 2.0 Separation-related reimbursement awards (6)(7) 0.9 — — 0.9 Total liabilities $ 2.9 $ — $ — $ 2.9 __________ (1) Quoted prices in active markets for identical assets. (2) Quoted prices for similar assets and liabilities in active markets. (3) Significant unobservable inputs. (4) Included within "Prepaid and other current assets" on the consolidated balance sheet. (5) Included within "Other liabilities" on the consolidated balance sheet. (6) Included within "Accrued expenses" on the consolidated balance sheet. (7) This amount represents an amount due to WestRock associated with WestRock equity awards held by Ingevity employees post Separation. In accordance with the EMA between Ingevity and WestRock entered into in connection with the Separation, we are required to reimburse WestRock the fair market value of awards on the day Ingevity employees exercise their awards. The income and expense, respectively, recognized during the years ended December 31, 2018 , 2017 , and 2016 was $0.1 million , $0.3 million , and $1.6 million , respectively. (8) This amount represents a non-designated foreign currency hedge associated with the purchase price of our acquisition of Perstorp AB's caprolactone business. See Note 24 for more information. The expense recognized during the year ended December 31, 2018 was $3.9 million . At December 31, 2018 and 2017 , the book value of capital lease obligations was $80.0 million and $80.0 million , respectively, and the fair value was $90.4 million and $92.9 million , respectively. The fair value of our capital lease obligations is based on the period-end quoted market prices for the obligations, using Level 1 inputs. The carrying amount, excluding debt issuance fees, of our variable interest rate long-term debt, not including long-term debt due within one year, was $366.2 million and $365.6 million as of December 31, 2018 and 2017 , respectively. The carrying value is a reasonable estimate of the fair value of our outstanding debt as our outstanding debt is variable interest rate debt. At December 31, 2018 , the book value of our fixed rate debt, the senior notes issued January 24, 2018, was $300.0 million , and the fair value was $275.2 million , based on Level 2 inputs. At December 31, 2018 and 2017 , the book value of our restricted investment was $71.2 million and $71.3 million , respectively, and the fair value was $66.7 million and $69.6 million , respectively, based on Level 1 inputs. The carrying value of our financial instruments: cash and cash equivalents, other receivables, other payables and accrued liabilities approximate their fair values due to the short-term nature of these financial instruments. |
Inventories, net
Inventories, net | 12 Months Ended |
Dec. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Inventories, net | Inventories, net December 31, In millions 2018 2017 Raw materials $ 36.5 $ 40.1 Production materials, stores and supplies 17.5 13.4 Finished and in-process goods 144.7 114.3 Subtotal 198.7 167.8 Less: excess of cost over LIFO cost (7.3 ) (7.8 ) Inventories, net $ 191.4 $ 160.0 Approximately 63 percent and 66 percent of Inventories, net at December 31, 2018 and 2017 , respectively, are valued using the LIFO method. During fiscal 2016, inventory quantities carried on a LIFO basis, primarily in our Performance Chemicals' domestic inventory, were reduced which led to liquidations of LIFO inventory quantities. These reductions resulted in a pre-tax decrease of $3.6 million , recorded to "Cost of sales" on our consolidated statement of operations. No such reductions occurred in fiscal 2018 or 2017. |
Property, Plant and Equipment,
Property, Plant and Equipment, net | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, net | Property, Plant and Equipment, net Property, plant and equipment, net consist of the following: December 31, In millions 2018 2017 Machinery and equipment $ 857.2 $ 792.5 Buildings and leasehold equipment 113.1 115.0 Land and land improvements 19.6 18.0 Construction in progress 71.2 35.8 Total cost 1,061.1 961.3 Less: accumulated depreciation (537.3 ) (522.8 ) Property, plant and equipment, net (1) $ 523.8 $ 438.5 _______________ (1) This includes capital leases related to machinery and equipment at our Wickliffe, Kentucky facility of $69.2 million and $70.0 million , and net book value of $6.7 million and $7.6 million at December 31, 2018 and 2017 , respectively. This also includes capital leases related to our Waynesboro, Georgia manufacturing facility for (a) machinery and equipment of $6.5 million and $5.9 million and net book value of $6.0 million and $5.7 million , (b) construction in progress of $13.7 million and $2.1 million and (c) buildings and leasehold improvements of $0.1 million and zero at December 31, 2018 and 2017 , respectively. Amortization expense associated with these capital leases is included within depreciation expense. The payments remaining under these capital leases obligations are included within Note 19. Depreciation expense was $41.9 million , $35.5 million , and $33.2 million for the years ended December 31, 2018 , 2017 and 2016 , respectively. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets, net | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets, net | Goodwill and Other Intangible Assets, net The changes in the carrying amount of goodwill by operating segment are as follows: Operating Segments In millions Performance Chemicals Performance Materials Total December 31, 2016 $ 8.1 $ 4.3 $ 12.4 Foreign currency translation — — — December 31, 2017 $ 8.1 $ 4.3 $ 12.4 Foreign currency translation (0.4 ) — (0.4 ) Goodwill acquired (1) 118.7 — 118.7 December 31, 2018 $ 126.4 $ 4.3 $ 130.7 _______________ (1) See Footnote 17 for more information about the Pine Chemicals Acquisition. Our fiscal year 2018 annual goodwill impairment test was performed as of October 1, 2018 . We determined no goodwill impairment existed. There were no events or circumstances indicating that goodwill might be impaired as of December 31, 2018 . All of Ingevity's other intangible assets, net are related to the Performance Chemicals operating segment. The following table summarizes intangible assets: December 31, 2018 December 31, 2017 In millions Gross carrying amount Accumulated amortization Net Gross carrying amount Accumulated amortization Net Brands (1) $ 11.4 $ 9.8 $ 1.6 $ 13.9 $ 11.8 $ 2.1 Customer contracts and relationships 151.0 30.3 120.7 28.2 25.4 2.8 Other 4.1 0.8 3.3 — — — Other intangibles, net (2) $ 166.5 $ 40.9 $ 125.6 $ 42.1 $ 37.2 $ 4.9 _______________ (1) Represents trademarks, trade names and know-how. (2) See Footnote 17 for more information about the Pine Chemicals Acquisition and the related increase in Intangible assets. The amortization expense related to our intangible assets in the table above for the years ended December 31, 2018 , 2017 and 2016 is shown in the table below. Amortization expense is included within "Cost of sales" and "Selling, general and administrative expenses" on our consolidated statements of operations. Years Ended December 31, In millions 2018 2017 2016 Amortization expense (1) $ 12.3 $ 2.4 $ 2.7 _______________ (1) See Footnote 17 for more information about the Pine Chemicals Acquisition and the related increase in Amortization expense. Based on the current carrying values of intangible assets, estimated pre-tax amortization expense for the next five years is as follows: 2019 - $14.3 million , 2020 - $13.2 million , 2021 - $12.3 million , 2022 - $12.2 million and 2023 - $12.2 million . The estimated pre-tax amortization expense may fluctuate due to changes in foreign currency. |
Debt, including Capital Lease O
Debt, including Capital Lease Obligations | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Debt, including Capital Lease Obligations | Debt, including Capital Lease Obligations Revolving Credit and Term Loan Facility Amendments On August 7, 2018, we entered into an Incremental Facility Agreement and Amendment No. 2 (the “Amendment”) to the Credit Agreement, dated as of March 7, 2016 (the “Existing Credit Agreement”, and as amended, supplemented or otherwise modified from time to time, including pursuant to the Incremental Facility Agreement and Amendment No. 1, dated as of August 21, 2017, and the Amendment, the “Amended Credit Agreement”). Among other things, the Amendment (i) increased the revolving commitments under the Existing Credit Agreement by $200.0 million (the “Incremental Revolving Commitments”) to $750 million and (ii) reduced the Applicable Rate (as defined in the Amended Credit Agreement). The Amendment also extended the maturity date for the loans and commitments under the Existing Credit Agreement to August 7, 2023. The Incremental Revolving Commitments have terms identical to those of the Revolving Commitments under the Existing Credit Agreement and will be treated as a single class with such existing commitments under the Amended Credit Agreement. Loans under the Amended Credit Agreement bear interest at either (a) an adjusted base rate or (b) an adjusted LIBOR rate, in each case, plus an applicable margin (the “Applicable Margin”), in the case of base rate loans, ranging between zero percent and 0.75 percent, and in the case of adjusted LIBOR rate loans, ranging between 1.00 percent and 1.75 percent. The Applicable Margin is based on a total leverage based pricing grid. Fees to revolving lenders under the Amended Credit Agreement, including fees in respect of the Incremental Revolving Commitments, include (i) commitment fees, based on a percentage of the daily unused portions of the facility, ranging from 0.15 percent to 0.30 percent and (ii) customary letter of credit fees. As consideration for the Amendment, the Company paid to each lender under the Existing Credit Agreement a consent fee equal to 0.05 percent of the aggregate principal amount of the commitments and outstanding loans held by such lender immediately prior to the Closing Date. Fees of $1.4 million were incurred to secure the Amended Credit Agreement. These fees have been deferred and will be amortized over the term of the arrangement. The credit facilities under the Amended Credit Agreement will mature on August 7, 2023. The Initial Term Loans and the Incremental Term A Loans (each, as defined in the Amended Credit Agreement) will amortize at a rate equal to 1.25 percent per quarter starting in September 2019, with the balance due at maturity. 2018 Senior Notes On January 24, 2018, we issued $300.0 million aggregate principal amount of 4.50 percent senior unsecured notes due 2026 (the “Notes”). The Notes were issued pursuant to an indenture dated as of January 24, 2018 (the “Indenture”), by and among Ingevity, the subsidiary guarantors party thereto and U.S. Bank National Association, as trustee. The Notes were offered and sold only to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A and to certain non-U.S. persons outside the U.S. pursuant to Regulation S under the Securities Act of 1933, as amended (the “Securities Act”). The Notes have not been registered under the Securities Act or any state securities laws and may not be offered or sold in the U.S. absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state laws. The net proceeds from the sale of the Notes, after deducting deferred financing fees of $5.7 million were approximately $294.3 million . We used the net proceeds from the sale of the Notes to finance, in part, our purchase of substantially all the assets primarily used in the pine chemicals business of Georgia-Pacific Chemicals LLC and Georgia-Pacific LLC. Interest payments on the Notes are due semiannually in arrears on February 1st and August 1st of each year, beginning on August 1, 2018, at a rate of 4.50 percent per year. The Notes will mature on February 1, 2026. Financial Covenants The Indenture contains certain customary covenants (including covenants limiting Ingevity's and its restricted subsidiaries’ ability to grant or permit liens on certain property securing debt, declare or pay dividends, make distributions on or repurchase or redeem capital stock, make investments in unrestricted subsidiaries, engage in sale and lease-back transactions, and engage in a consolidation or merger, or sell, transfer or otherwise dispose of all or substantially all of the assets of our and our restricted subsidiaries, taken as a whole) and events of default (subject in certain cases to customary exceptions, as well as grace and cure periods). The occurrence of an event of default under the Indenture could result in the acceleration of the Notes and could cause a cross-default that could result in the acceleration of other indebtedness of Ingevity and its subsidiaries. The revolving credit facility and term loan facility include financial covenants requiring Ingevity to maintain on a consolidated basis a maximum total leverage ratio of 4.00 to 1.00 (which may be increased to 4.50 to 1.00 under certain circumstances) and a minimum interest coverage ratio of 3.00 to 1.00. We were in compliance with all covenants at December 31, 2018 . As part of the Separation, WestRock required Ingevity to contribute $68.9 million in a trust managed in order to secure repayment of the capital lease obligation at maturity. The trust, presented as restricted investment on our consolidated balance sheet, purchased long term bonds that mature in 2025 and 2026. The principal received at maturity of the bonds along with interest income that is reinvested in the trust are expected to be equal to or more than the $80.0 million capital lease obligation that is due in 2027. Because the provisions of the trust provide us the ability, and it is our intent, to hold the investments to maturity, the investments held by the trust are accounted for as held to maturity; therefore, they are held at their amortized cost. The fair value of the investments within the trust was $66.7 million and $69.6 million as of December 31, 2018 and 2017 , respectively (see Note 6 for more information). The investments held by the trust earn interest at the stated coupon rate of the invested bonds. Interest earned on the investments held by the trust is recognized as interest income and presented within Interest income on our consolidated statement of operations. Current and long-term debt including capital lease obligations consisted of the following: December 31, 2018 December 31, In millions Interest rate Maturity date 2018 2017 Revolving Credit Facility (1) 3.77% 2023 $ — $ — Term Loan Facility 3.77% 2023 375.0 375.0 Senior Notes 4.50% 2026 300.0 — Capital lease obligations 7.67% 2027 80.0 80.0 Other notes payable 5.02% 2018-2019 3.9 — Total debt including capital lease obligations $ 758.9 $ 455.0 Less: debt issuance costs 6.5 1.6 Total debt including capital lease obligations, net of debt issuance costs $ 752.4 $ 453.4 Less: debt maturing within one year (2) 11.2 9.4 Long-term debt including capital lease obligations $ 741.2 $ 444.0 _______________ (1) Letters of credit outstanding under the revolving credit facility were $1.9 million and $1.8 million and available funds under the facility were $748.1 million and $548.2 million at December 31, 2018 and December 31, 2017 , respectively. On February 13, 2019, the revolving credit facility was utilized as the primary source of funds (along with available cash on hand) to close our Caprolactone Acquisition. Our available capacity under our revolving credit facility immediately following this drawdown was $113.1 million . See Note 24 for more information of the Caprolactone Acquisition. (2) Debt maturing within one year is included in "Current maturities of long-term debt" on the consolidated balance sheet. |
Share-based Compensation
Share-based Compensation | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Compensation | Share-based Compensation Prior to the Separation, share-based compensation expense was allocated to Ingevity based on the portion of WestRock's incentive share-based compensation program in which Ingevity employees participated. Share-based compensation expense allocated by WestRock to Ingevity was zero , zero , and $0.5 million for the years ended December 31, 2018 , 2017 and 2016 , respectively. This allocated share-based compensation expense is included in the overall allocations from WestRock discussed further in Note 13. Equity Incentive Plan Adopted at Separation, the Ingevity Corporation 2016 Omnibus Incentive Plan grants certain corporate officers, key employees and non-employee directors of Ingevity and subsidiaries different forms of benefits, including stock options, RSUs, DSUs and PSUs. The Ingevity Corporation 2016 Omnibus Incentive Plan has a maximum shares reserve of 4,000,000 for the grant of equity awards. As of December 31, 2018 , 3,258,944 shares under the Ingevity Corporation 2016 Omnibus Incentive Plan are still available for grants, assuming that Ingevity performs at the target performance level in each year of the three-year performance period for PSU awards. Ingevity's Compensation Committee determines the long-term incentive mix, including stock options, RSUs and PSUs, and may authorize new grants annually. Employee Stock Purchase Plan On December 9, 2016, our Compensation Committee and Board of Directors approved the 2017 Ingevity Corporation Employee Stock Purchase Plan ("ESPP"), which was approved by Ingevity’ stockholders on April 27, 2017. The ESPP allows eligible employee participants to purchase no more than 5,000 shares of our common stock at a discount through payroll deductions up to 15 percent of their compensation deducted during the purchase period. However, no participant shall be permitted to purchase common stock with a value greater than $25,000 in any calendar year. The ESPP is a tax-qualified plan under Section 423 of the Internal Revenue Code. The ESPP consists of a one month enrollment period preceding the three-month purchase period. Employees purchase shares in each purchase period at 85 percent of the market value of our common stock at either the beginning of the offering period or the end of the purchase period, whichever price is lower. Under the ESPP, a total of 250,000 shares of Ingevity's common stock are reserved and authorized for issuance to participating U.S. employees, as defined by the ESPP, which excludes certain officers of Ingevity. As of December 31, 2018 , 206,255 shares under the ESPP are still available for issuance. The initial offering period under the ESPP began on July 1, 2017. During fiscal 2018 , there were 31,862 shares issued under the ESPP at an average price of $57.81 . Our share-based compensation expense recognized post Separation associated with Ingevity's incentive plan and the ESPP is included in the table below. Years Ended December 31, In millions 2018 2017 2016 Stock option expense $ 2.3 $ 1.5 $ 0.7 ESPP expense 0.5 0.2 — RSU, DSU and PSU expense 9.7 8.4 4.0 Total share-based compensation expense (1) 12.5 10.1 4.7 Income tax benefit (2.9 ) (3.8 ) (1.9 ) Total share-based compensation expense, net of tax $ 9.6 $ 6.3 $ 2.8 _______________ (1) Amounts reflected in "Selling, general and administrative expenses" on the Consolidated Statements of Operations. Stock Options All stock options vest in accordance with vesting conditions set by the compensation committee of Ingevity's Board of Directors. Stock options granted to date have vesting periods of one to three years from the date of grant. Incentive and non-qualified options granted under the Plan expire no later than 10 years from the grant date. Expense related to stock options granted from the Separation through December 31, 2018 was based on the assumptions shown in the table below: Years Ended December 31, Weighted-average assumptions used to calculate expense for stock options 2018 2017 2016 Risk-free interest rate 2.7% 2.1% 1.6% Average life of options (years) 6.5 6.5 6.5 Volatility 27.5% 35.0% 35.0% Dividend yield — — — Fair value per stock option $ 25.51 $ 20.71 $ 10.61 The following table summarizes Ingevity's stock option activity for the period from the Separation through December 31, 2018, as there was no Ingevity stock option activity prior to Separation. Number of Options (in thousands) Weighted-average exercise price (per share) Weighted-average remaining contractual term (years) Aggregate intrinsic value (in thousands) Outstanding, May 16, 2016 — $ — Granted 208 28.03 Exercised — — Forfeited — — Canceled — — Outstanding, December 31, 2016 208 $ 28.03 9.4 $ 5,573 Granted 109 53.11 Exercised (7 ) 27.38 Forfeited (7 ) 31.97 Canceled — — Outstanding, December 31, 2017 303 $ 36.72 8.7 $ 10,022 Granted 110 74.91 Exercised (6 ) 32.37 Forfeited (4 ) 51.66 Canceled — — Outstanding, December 31, 2018 403 $ 46.98 8.1 $ 14,450 Exercisable, December 31, 2018 9 $ 46.14 8.0 $ 352 The aggregate intrinsic values in the table above represent the total pre-tax intrinsic value (the difference between Ingevity's closing stock price on the last trading day of the period and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their in-the-money options at each year end. The amount changes based on the fair market value of Ingevity's stock. As of December 31, 2018 , $4.6 million of total unrecognized compensation cost related to stock options is expected to be recognized over a weighted-average period of 1.0 year. Restricted Stock Units, Deferred Stock Units and Performance-based Restricted Stock Units All RSUs, DSUs and PSUs vest in accordance with vesting conditions set by the Compensation Committee of Ingevity’s Board of Directors. RSUs and DSUs granted to date have vesting periods ranging from less than one year to three years from the date of grant. PSUs granted to date have vesting periods of three years from the date of grant, including grants that have a cumulative three -year performance period, subject to satisfaction of the applicable performance goals established for the respective grant. We periodically assess the probability of achievement of the performance criteria and adjust the amount of compensation expense accordingly. Compensation expense is recognized over the vesting period and adjusted for the probability of achievement of the performance criteria. The following table summarizes Ingevity's RSUs, DSUs and PSUs activity for the period from the Separation through December 31, 2018 , as there was no Ingevity stock option activity prior to Separation. RSUs and DSUs PSUs Number of Units (in thousands) (1) Weighted average grant date fair value (per share) Number of Units (in thousands) (1) Weighted average grant date fair value (per share) Nonvested, May 15, 2016 — $ — — $ — Granted 190 28.08 127 28.06 Vested (23 ) 27.90 — — Forfeited — — — — Nonvested, December 31, 2016 167 $ 28.08 127 $ 28.06 Granted 61 57.21 66 53.11 Vested (75 ) 28.47 — — Forfeited (4 ) 31.00 (9 ) 27.90 Nonvested, December 31, 2017 (2) 149 $ 39.67 184 $ 37.01 Granted 56 77.98 56 74.91 Vested (89 ) 60.94 — — Forfeited (1 ) 61.15 (1 ) 52.18 Nonvested, December 31, 2018 (2) 115 $ 60.94 239 $ 45.88 _______________ (1) The number granted represents the number of shares issuable upon vesting of RSUs and DSUs. For PSUs the number granted represents the number of shares issuable upon vesting assuming that Ingevity performs at the target performance level in each year of the three-year performance period. (2) The nonvested RSU and DSU number of shares at December 31, 2018 , 2017 , and 2016 includes 10 thousand , 8 thousand , and zero DSUs, respectively. As of December 31, 2018 and December 31, 2017 , there was $22.0 million and $12.6 million , respectively, of unrecognized share-based compensation expense related to nonvested awards. Those costs are expected to be recognized over a weighted-average period of one year. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Equity | Equity Summarized below is the roll forward of accumulated other comprehensive income (loss), net of tax. In millions Foreign currency adjustments Derivative Instruments Pension and other postretirement benefits Total Accumulated other comprehensive income (loss), net of tax at December 31, 2015 $ (15.5 ) $ (1.0 ) $ — $ (16.5 ) 2016 Activity Other comprehensive income (loss) before reclassifications (2.9 ) — (0.6 ) (3.5 ) Amounts reclassified from accumulated other comprehensive income (loss) — 1.0 — 1.0 Accumulated other comprehensive income (loss), net of tax at December 31, 2016 $ (18.4 ) $ — $ (0.6 ) $ (19.0 ) 2017 Activity Other comprehensive income (loss) before reclassifications 8.3 (0.1 ) (0.7 ) 7.5 Amounts reclassified from accumulated other comprehensive income (loss) (1) — 0.1 — 0.1 Reclassification of certain deferred tax effects (3) — — (0.3 ) (0.3 ) Accumulated other comprehensive income (loss), net of tax at December 31, 2017 $ (10.1 ) $ — $ (1.6 ) $ (11.7 ) 2018 Activity Other comprehensive income (loss) before reclassifications (6.3 ) 1.3 (0.3 ) (5.3 ) Amounts reclassified from accumulated other comprehensive income (loss) (1) — (0.9 ) 0.2 (0.7 ) Accumulated other comprehensive income (loss), net of tax at December 31, 2018 $ (16.4 ) $ 0.4 $ (1.7 ) $ (17.7 ) _______________ (1) Amounts relate to derivative instruments entered to hedge foreign currency exchange risks on revenue transactions and price risk on natural gas purchases, and therefore were reclassified to "Net sales" and "Cost of sales", respectively. Amounts were reclassified when the hedged items are recognized in the consolidated statements of operations. (2) Amounts reclassified to retained earnings due to early adoption of ASU 2018-02. Noncontrolling interest acquisition On August 1, 2018, we completed the acquisition of the remaining 30 percent noncontrolling interest in Purification Cellutions, LLC, now known as Ingevity Georgia, LLC, which was treated as a partnership for tax purposes, for a purchase price of $80.0 million . The acquisition resulted in the elimination of Noncontrolling interest of $11.4 million and the recognition of a Deferred tax asset of $14.3 million , with the remainder being recorded against Additional paid in capital of $54.3 million in our Consolidated Financial Statements. Share repurchases On February 20, 2017, the Board of Directors authorized the repurchase of up to $100.0 million of our common stock. In addition, on November 1, 2018, the Board of Directors approved the authorization for the repurchase of up to an additional $350.0 million of Ingevity’s outstanding common stock. The approval of this $350.0 million is in addition to the $100.0 million share repurchase program approved in February 2017. The repurchase program does not include a specific timetable or price targets and may be suspended or terminated at any time. Shares may be purchased through open market or privately negotiated transactions at the discretion of management based on its evaluation of market prevailing conditions and other factors. During the year ended December 31, 2018 , we repurchased $47.4 million in common shares, representing 561,000 shares of our common stock at a weighted average cost per share of $84.59 . At December 31, 2018 , $396.0 million remained unused under our Board-authorized repurchase program. We record shares of common stock repurchased at cost as treasury stock, resulting in a reduction of stockholders’ equity in the consolidated balance sheets. When the treasury shares are contributed under our employee benefit plans or issued for option exercises, we use a first-in, first-out (“FIFO”) method for determining cost. The difference between the cost of the shares and the market price at the time of contribution to an employee benefit plan is added to or deducted from the related capital in excess of par value of common stock. |
Transactions with WestRock and
Transactions with WestRock and related-parties | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Transactions with WestRock and related-parties | Transactions with WestRock and Related Parties The consolidated statements of operations prior to May 15, 2016, include allocations from WestRock as summarized below: Years Ended December 31, In millions 2018 2017 2016 Cost of sales $ — $ — $ 5.7 Selling, general and administrative expenses — — 6.5 Interest expense, net — — 7.2 Total allocated cost (1) $ — $ — $ 19.4 _______________ (1) Allocated costs represent costs necessary to support Ingevity's operations which include governance and corporate functions such as information technology, accounting, human resources, accounts payable and other direct services including the interest on WestRock debt incurred to provide such services. Prior to the Separation, we purchased certain raw materials from WestRock that were included in cost of sales. Purchases for the year ended December 31, 2016 were $20.1 million . At Separation, we entered into a long-term supply agreement with WestRock pursuant to which we purchase all of the CTO output from WestRock’s existing kraft mills at the time of separation, subject to certain exceptions. Beginning in 2025, either party may provide a notice to the other party terminating the agreement five years from the date of such notice. Beginning one year after such notice, the quantity of products provided by WestRock under the WestRock agreement will be gradually reduced over a four-year period based on the schedule set forth in the WestRock agreement. In addition, from 2022 until 2025, either party may provide one-year notice to remove a kraft mill as a supply source. The two largest kraft mills under the WestRock agreement currently are expected to supply approximately 19% to 20% and 17% to 18% , respectively, of the total amount of products expected to be supplied under our agreement with WestRock. In the event that WestRock exercises its right to terminate our supply agreement with them or remove a kraft mill as a supply source, we may be able to obtain substitute supplies of CTO from other suppliers, spot purchases or a new contract with WestRock. The agreement with WestRock includes pricing terms based on market prices. Under this agreement, based on WestRock’s current output, we currently expect to source approximately 30% to 40% of our CTO requirements through 2025 based on the maximum operating rates of our three Performance Chemicals' facilities. As further described in Note 1, the Separation Agreements govern the relationship among Ingevity and WestRock following the Separation and provide for the allocation of various assets, liabilities, rights and obligations and include arrangements for transition services to be provided by WestRock to Ingevity. |
Retirement Plans
Retirement Plans | 12 Months Ended |
Dec. 31, 2018 | |
Postemployment Benefits [Abstract] | |
Retirement Plans | Retirement Plans Prior to the Separation, WestRock offered various long-term benefits to its employees, including Ingevity employees. In these cases, the participation of our employees in these plans is reflected in the Consolidated Financial Statements as though Ingevity participated in a multi-employer plan with the other businesses of WestRock. For periods prior to the Separation, assets and liabilities of such plans were retained by WestRock. Net periodic benefit costs allocated to Ingevity associated with these pension plans, for the year ended December 31, 2016 were $3.2 million . This allocated net periodic benefit cost is included in the overall allocations from WestRock, discussed further in Note 13. Defined Contribution Plans U.S. Ingevity employees ceased participating in the WestRock 401(k) plan on December 31, 2015 preceding the Separation. Effective January 1, 2016, the Ingevity Corporation Retirement Savings Plan ("Plan") was established. The Plan is a qualified salary-reduction plan under Section 401(k) of the U.S. Internal Revenue Code. Eligible U.S. employees may participate by contributing a portion of their compensation. For non-union eligible employees participating in the Plan Ingevity makes matching contributions up to six percent of the employee deferral. In addition to the matching contributions, Ingevity also makes a non-elective contribution of three percent of eligible compensation per payroll for non-union employees. For union eligible employees participating in the Plan Ingevity makes matching contributions up to 100 percent of the first three percent of the employee deferrals and 50 percent on the next two percent of deferrals. U.S. salaried employees who were no longer eligible to participate in the WestRock defined benefit pension plan, as of the date of Separation, were provided an enhanced contribution into the Plan. The enhanced benefits consist of a transition contribution of four or ten percent of the employee’s eligible compensation for employees who were grandfathered in the WestRock cash balance and final average pay pension plan, respectively. The transition contributions will continue to December 31, 2020, unless the grandfathered employee terminates employment sooner. Charges associated with employer contributions to the Plan were $10.2 million , $9.3 million , and $7.7 million for the years ended December 31, 2018 , 2017 , and 2016 , respectively. Defined Benefit Pension and Postretirement Plans In conjunction with the Separation, Ingevity employees stopped participating in WestRock pension and post-retirement benefit plans. On May 16, 2016, Ingevity established new qualified and non-qualified benefit plans, similar in design to the WestRock plans, to continue the pension and post-retirement benefits provided to our employees and retirees based on the obligations assumed from WestRock. As further defined by the EMA, Ingevity assumed certain domestic and international pension and other post-retirement benefit obligations from WestRock on the date of Separation. The assumed retirement obligations consisted of accrued defined benefit obligations earned by Ingevity domestic hourly union employees, as of the day of Separation, net of contributed assets; accrued obligations from a frozen non-qualified defined benefit pension plan for certain salaried and former salaried employees of Ingevity; and other post-retirement medical and life insurance benefits. We are required to recognize in our consolidated balance sheets the overfunded and underfunded status of our defined benefit postretirement plans. The overfunded and underfunded status is defined as the difference between the fair value of plan assets and the projected benefit obligation. We are also required to recognize, as a component of other comprehensive income, the actuarial gains and losses and the prior service costs and credits that arise during the period. The following table summarizes the weighted average assumptions used and components of our defined benefit postretirement plans. The following tables also reflect a measurement date of December 31: Pensions Other Benefits December 31, In millions, except percentages 2018 2017 2018 2017 Following are the weighted average assumptions used to determine the benefit obligations at December 31: Discount rate - qualified benefit plans 4.20 % 3.55 % — % — % Discount rate - non-qualified benefit plans 4.15 % 3.55 % 4.10 % 3.45 % Rate of compensation increase N/A N/A N/A N/A Change in projected benefit obligation Project benefit obligation at January 1 $ 28.8 $ 24.4 $ 0.8 $ 0.7 Service cost 1.6 1.2 — — Interest cost 1.0 1.0 — — Actuarial loss (gain) (2.0 ) 2.0 (0.1 ) 0.1 Plan amendments 0.5 0.6 — — Benefit payments (0.5 ) (0.4 ) — — Projected benefit obligation at December 31 (1) 29.4 28.8 0.7 0.8 Change in plan assets Fair value of plan asset at January 1 22.6 19.2 — — Actual return on plan assets (1.1 ) 2.4 — — Company contributions 1.6 1.4 — — Benefit payments (0.5 ) (0.4 ) — — Fair value of plan assets at December 31 22.6 22.6 — — Funded Status Net Funded Status of the Plan (Liability) $ (6.8 ) $ (6.2 ) $ (0.7 ) $ (0.8 ) Amount recognized in the consolidated balance sheets: Pension and other postretirement benefit asset (2) $ — $ — $ — $ — Pension and other postretirement benefit (liability) (2) (6.8 ) (6.2 ) (0.7 ) (0.8 ) Total Net Funded Status of the Plan (Liability) $ (6.8 ) $ (6.2 ) $ (0.7 ) $ (0.8 ) _______________ (1) The accumulated benefit obligation for all years presented equals the projected benefit obligation, for each plan respectively. (2) Asset balance is included in "Other assets" and liability balances are included in "Other liabilities" on the consolidated balance sheet. Amounts Recognized in Other Comprehensive Income (Loss) Changes in plan assets and benefit obligations recognized in other comprehensive income (loss) are as follows: Pensions Other Benefits Years Ended December 31, In millions 2018 2017 2016 2018 2017 2016 Current year net actuarial loss (gain) $ — $ 1.1 $ 0.9 $ (0.1 ) $ 0.1 $ (0.1 ) Current year prior service cost (credit) 0.5 — 0.1 — — — Curtailments (0.2 ) — — — — — Total recognized in other comprehensive (income) loss, before taxes 0.3 1.1 1.0 (0.1 ) 0.1 (0.1 ) Total recognized in other comprehensive (income) loss, after taxes $ 0.3 $ 0.7 $ 0.5 $ (0.1 ) $ — $ 0.1 Amounts Recognized in Accumulated Other Comprehensive Income (Loss) The amounts in accumulated other comprehensive income (loss) that have not yet been recognized as components of net periodic benefit cost are as follows: Pensions Other Benefits December 31, In millions 2018 2017 2018 2017 Net actuarial (gain) loss $ 1.3 $ 1.4 $ (0.1 ) $ (0.1 ) Prior service cost (credit) 0.9 0.7 — — Accumulated other comprehensive (income) loss, before taxes 2.2 2.1 (0.1 ) (0.1 ) Accumulated other comprehensive (income) loss, after taxes $ 1.7 $ 1.7 $ (0.1 ) $ (0.1 ) The estimated net actuarial loss and prior service cost that will be amortized from accumulated other comprehensive income (loss) into our net annual benefit cost during 2019 are zero and less than $0.1 million , respectively. Net Annual Benefit Costs Assumptions The following table summarizes the weighted-average assumptions used for the components of net annual benefit cost: Pensions Other Benefits Years Ended December 31, In millions, except percentages 2018 2017 2016 2018 2017 2016 Discount rate - qualified benefit plans (1) 3.55 % 4.10 % 4.00 % — % — % — % Discount rate - non-qualified benefit plans (1) 3.55 % 4.15 % 3.75 % 3.45 % 3.95 % 3.75 % Expected return on plan assets 4.00 % 4.50 % 4.50 % N/A N/A N/A Components of net annual benefit cost: Service cost (2) $ 1.6 $ 1.2 $ 0.7 $ — $ — $ — Interest cost (3) 1.0 1.0 0.6 — — — Expected return on plan assets (3) (0.9 ) (0.9 ) (0.6 ) — — — Amortization of prior service cost (3) 0.1 — — — — — Amortization of net actuarial and other (gain) loss (3) — — — — — — Recognized (gain) loss due to curtailments 0.2 — — — — — Net annual benefit cost $ 2.0 $ 1.3 $ 0.7 $ — $ — $ — _______________ (1) The discount rate used to calculate pension and other post-retirement obligations was based on a review of available yields on high-quality corporate bonds. In selecting a discount rate, we placed particular emphasis on a discount rate yield-curve provided by our third-party actuary which takes into consideration the projected cash flows that represent the expected timing and amount of our plans' benefit payments. (2) Amounts are recorded to "Cost of sales" on our consolidated statements of operations consistent with the employee compensation costs that participate in the plan. (3) Amounts are recorded to "Other (income) expense, net" on our consolidated statements of operations. Contributions We made a voluntary cash contribution of $1.5 million and $1.2 million to our Union Hourly defined benefit pension plan in the years ended December 31, 2018 and 2017, respectively. There are no required cash contributions to our Union Hourly defined benefit pension plan in fiscal 2019, and we currently have no plans to make any voluntary cash contributions in fiscal 2019. Fair Value Hierarchy The following table presents our fair value hierarchy for our major categories of pension plan assets by asset class. See Note 6 for the definition of fair value and the descriptions of Level 1, 2 and 3 in the fair value hierarchy. In millions December 31, 2018 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs Cash and short-term investments $ 0.1 $ 0.1 $ — $ — Equity funds and other investments 3.6 3.6 — — Fixed income mutual funds 18.9 1.4 17.5 — Total assets $ 22.6 $ 5.1 $ 17.5 $ — In millions December 31, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs Cash and short-term investments $ 0.5 $ 0.5 $ — $ — Equity funds and other investments 2.7 2.7 — — Fixed income mutual funds 19.4 1.4 18.0 — Total assets $ 22.6 $ 4.6 $ 18.0 $ — Estimated Future Benefit Payments The following table reflects the estimated future benefit payments for our pension and other postretirement benefit plans. These estimates take into consideration expected future service, as appropriate. In millions Pensions Other Benefits 2019 $ 0.5 $ — 2020 0.6 — 2021 0.8 — 2022 1.0 — 2023 1.1 — 2024-2028 $ 7.7 $ 0.2 Sensitivity Analysis A one-half percent increase in the assumed discount rate would have decreased pension benefit obligations by $2.0 million at December 31, 2018 and decreased pension benefit costs by $0.1 million for 2018 . A one-half percent decrease in the assumed discount rate would have increased pension obligations by $2.3 million at December 31, 2018 and increased pension benefit cost by $0.3 million for 2018 . A one-half percent increase in the assumed expected long-term rate of return on plan assets would have decreased pension costs by $0.1 million for 2018 . A one-half percent decrease in the assumed long-term rate of return on plan assets would have increased pension costs by $0.1 million for 2018 . |
Business Separation
Business Separation | 12 Months Ended |
Dec. 31, 2018 | |
Other Income and Expenses [Abstract] | |
Business Separation | Business Separation In connection with the Separation as further described in Note 1 and Note 2, we have incurred pre-tax separation costs as shown in the table below. Prior to the Separation, these costs were primarily related to third-party professional fees associated with separation activities and one-time costs of new hires specifically required to separate and stand up Ingevity. Post-Separation, these costs represent legal, information technology and other advisory fees to transition from a division of WestRock to a stand-alone public company. Years Ended December 31, In millions 2018 2017 2016 Separation costs $ — $ 0.9 $ 17.5 |
Restructuring and Other (Income
Restructuring and Other (Income) Charges, net | 12 Months Ended |
Dec. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Other (Income) Charges, net | Restructuring and Other (Income) Charges, net We continually perform strategic reviews and assess the return on our operations which sometimes results in a plan to restructure the business. The cost and benefit of these strategic restructuring initiatives are recorded as restructuring and other (income) charges, net recorded within Restructuring and other (income) charges, net on our consolidated statement of operations. These costs are excluded from our operating segment results. We record an accrual for severance and other non-recurring costs under the provisions of the relevant accounting guidance. Additionally, in some restructuring plans write-downs of long-lived assets may occur. Two types of assets are impacted: assets to be disposed of by sale and assets to be abandoned. Assets to be disposed of by sale are measured at the lower of carrying amount or estimated net proceeds from the sale. Assets to be abandoned with no remaining future service potential are written down to amounts expected to be recovered. The useful lives of assets to be abandoned that have a remaining future service potential are adjusted and depreciation is recorded over the adjusted useful life. Below provides detail of the restructuring and other (income) charges, net incurred. 2018 activities In February 2018, we sold assets from the Performance Chemicals derivatives operations in Duque De Caxias, Rio de Janeiro, Brazil. These assets were part of a facility that was closed as a result of a restructuring event in 2016 (see 2016 activities below). As a result of this sale, we recorded $0.6 million as a gain on sale of assets offset by other employee related costs of $0.1 million for the year ended December 31, 2018. 2017 activities In January 2017, we initiated a reorganization to streamline our leadership team, flatten the organization and reduce costs. Because of this reorganization, we recorded $1.3 million in severance and other employee-related costs for the year ended December 31, 2017. During the year ended December 31, 2017 we also recorded $2.4 million of additional miscellaneous exit costs primarily associated with the exit of our Performance Chemicals' manufacturing operations in Palmeira, Santa Catarina, Brazil which began in the fourth quarter of 2016 (see 2016 activities below). 2016 activities As a result of continued deteriorating market conditions within the South America region, on October 31, 2016, our Board of Directors approved a plan to exit our Performance Chemicals' manufacturing operations in Palmeira, Santa Catarina, Brazil. As a result, we recorded a non-cash pre-tax impairment charge to property, plant and equipment in the amount of $30.2 million and recorded severance costs of $1.8 million . The severance costs began to be paid in the fourth quarter of 2016. Refinery production ceased before year end, and the facility was decommissioned in 2017. We recorded $2.6 million of additional miscellaneous exit costs during the year ended December 31, 2016. During the first quarter of 2016, we announced the closure of the Performance Chemicals' derivatives operation in Duque de Caxias, Rio de Janeiro, Brazil. As a result of this closure, we recorded $0.1 million impairment charge on fixed assets, $1.8 million in severance and other employee-related costs and $1.7 million of additional miscellaneous exit costs during year ended December 31, 2016. During the first quarter of 2016, we also announced a company-wide restructuring to better align our workforce in light of changing macroeconomic and market realities. The restructuring decision resulted in workforce reductions at several of our locations. As a result, during the year ended December 31, 2016, we recorded severance and other employee-related charges of $2.7 million ( $1.9 million related to Performance Chemicals segment and $0.8 million related to Performance Materials segment). We also recorded an impairment charge on fixed assets of $0.3 million in the year ended December 31, 2016 (related to the Performance Chemicals segment). Detail on the restructuring charges and asset disposal activities is provided below. Years Ended December 31, In millions 2018 2017 2016 Restructuring and other (income) charges, net Gain on sale of assets and businesses $ (0.6 ) $ — $ — Severance and other employee-related costs (1) 0.1 1.3 6.3 Asset write-downs (2) — — 30.6 Other (income) charges, net (3) — 2.4 4.3 Total restructuring and other (income) charges, net $ (0.5 ) $ 3.7 $ 41.2 _______________ (1) Represents severance and employee benefit charges. (2) Primarily represents accelerated depreciation and impairment charges on long-lived assets, which were or are to be abandoned. To the extent incurred the acceleration effect of re-estimating settlement dates and revised cost estimates associated with asset retirement obligations due to facility shutdowns are also included within the asset write-downs. (3) Primarily represents costs associated with rental payments, contract terminations, and other miscellaneous exit costs. Other Income primarily represents favorable developments on previously recorded exit costs as recoveries associated with restructuring activities. Roll forward of Restructuring Reserves The following table shows a roll forward of restructuring reserves that will result in cash spending. Balance at Change in Cash Balance at Change in Cash Balance at 12/31/2016 (1) Reserve (2) Payments Other (3) 12/31/2017 (1) Reserve (2) Payments Other (3) 12/31/2018 (1) $ 2.2 3.7 (5.5 ) (0.2 ) $ 0.2 — (0.2 ) — $ — _______________ (1) Included in "Accrued Expenses" on the consolidated balance sheet. (2) Includes severance and other employee-related costs, exited leases, contract terminations and other miscellaneous exit costs. Any asset write-downs including accelerated depreciation and impairment charges are not included in the above table. (3) Primarily non-cash charges and foreign currency translation adjustments. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Georgia-Pacific's Pine Chemical Business On August 22, 2017, we entered into an Asset Purchase Agreement (the "Pine Chemicals Purchase Agreement") with Georgia-Pacific Chemicals LLC, Georgia-Pacific LLC (together with Georgia-Pacific Chemicals LLC, "GP") and Ingevity Arkansas, LLC, a wholly-owned subsidiary of Ingevity, to purchase substantially all the assets primarily used in GP's pine chemical business (the "Pine Chemical Business"), including assets and facilities related to tall oil fractionation operations and the production or modification of tall oil fatty acids, tall oil rosins, rosin derivatives and formulated products (the "Pine Chemicals Acquisition"). On March 8, 2018 (the "Pine Chemicals Acquisition Date"), pursuant to the terms and conditions set forth in the Purchase Agreement, we completed the Pine Chemicals Acquisition. During the third quarter of 2018, we finalized the purchase price which included a final adjustment for working capital resulting in an aggregate purchase price of $315.5 million . The Pine Chemicals Acquisition was primarily funded with the net proceeds from the $300.0 million senior notes issued on January 24, 2018. See Note 10 for more information on the senior notes. In addition, on the Pine Chemicals Acquisition, the Company and GP entered into a 20 -year, market-based crude tall oil ("CTO") supply contract with certain of Georgia-Pacific’s paper mill operations. The Pine Chemicals Acquisition is being integrated into our Performance Chemicals segment and has been included within our results of operations since the Pine Chemicals Acquisition Date. Although not yet complete, a substantial portion of the Pine Chemical Business has been integrated into our existing Performance Chemicals operations. As a result, our ability to separate net sales and operating performance of the Pine Chemicals Acquisition from our existing Performance Chemicals' operating results is no longer practicable. Purchase Price Allocation The Pine Chemicals Acquisition has been accounted for under the business combinations accounting guidance, and as such we have applied acquisition accounting. Acquisition accounting requires, among other things, that assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. The aggregate purchase price noted above was allocated to the major categories of assets acquired and liabilities assumed based upon their estimated fair values at the Pine Chemicals Acquisition Date using primarily Level 2 and Level 3 inputs. These Level 2 and Level 3 valuation inputs include an estimate of future cash flows and discount rates. Additionally, estimated fair values are based, in part, upon outside appraisals for certain assets, including specifically-identified intangible assets. The following table summarizes the consideration paid for the Pine Chemicals Acquisition and the amounts of the assets acquired and liabilities assumed as of the Pine Chemicals Acquisition Date. Purchase Price Allocation In millions Weighted Average Amortization Period Fair Value Accounts receivable $ 16.2 Inventories (1) 9.4 Property, plant and equipment 39.3 Intangible assets (2) Patents 12 years 1.9 Non-compete agreement 3 years 2.2 Customer relationships 11 years 129.0 Goodwill (3) 118.7 Other assets 0.1 Total fair value of assets acquired 316.8 Accounts payable 0.8 Accrued expenses 0.5 Total fair value of liabilities assumed $ 1.3 Total cash paid $ 315.5 _______________ (1) Fair value of finished good inventories acquired included a step-up in the value of approximately $1.4 million, of which $1.4 million was expensed in the year ended December 31, 2018. The expense is included in "Cost of sales" on the consolidated statement of operations. (2) The aggregate amortization expense was for the year ended December 31, 2018. Estimated amortization expense is as follows: 2019 - $12.7 million, 2020 - $12.7 million, 2021 - $12.0 million, 2022 - $11.8 million, and 2023 - $11.8 million. (3) Goodwill largely consists of expected cost synergies and economies of scale resulting from the business combination. We expect the full amount to be deductible for income tax purposes. Unaudited Pro Forma Financial Information The following unaudited pro forma results of operations assume that the Pine Chemicals Acquisition occurred at the beginning of the periods presented. 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 Pine Chemicals Acquisition had occurred at the beginning of the periods presented, nor are they indicative of future results of operations. The pro forma results presented below are adjusted for the removal of Acquisition and other related costs of $6.0 million and $7.1 million for the years ended December 31, 2018 and 2017 , respectively. Years Ended December 31, In millions 2018 2017 Net sales $ 1,153.8 $ 1,073.0 Income (loss) before income taxes 229.3 176.9 Diluted earnings (loss) per share attributable to Ingevity stockholders $ 4.12 $ 3.01 Perstorp AB's Caprolactone Business See Note 24 for more information on the acquisition of Perstorp AB's caprolactone business completed on February 13, 2019. Acquisition-related costs Costs incurred to complete and integrate the acquisitions described above into our Performance Chemicals segment are expensed as incurred and recorded to Acquisition-related costs on our consolidated statement of operations. During the years ended December 31, 2018 , 2017 and 2016 we recognized $10.8 million , $7.1 million and zero , respectively. These costs represent transaction costs, legal fees, professional third-party service fees, and in 2018 include the unrealized loss of $3.9 million from the purchase price hedge associated with the Caprolactone Acquisition. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Domestic and foreign components of Income (loss) before income taxes are shown below: Years Ended December 31, In millions 2018 2017 2016 Domestic $ 213.3 $ 180.1 $ 118.3 Foreign 8.5 (5.3 ) (31.3 ) Total $ 221.8 $ 174.8 $ 87.0 The provision (benefit) for income taxes consisted of: Years Ended December 31, In millions 2018 2017 2016 Current Federal $ 32.5 $ 51.6 $ 37.4 State and local 6.0 3.7 5.0 Foreign 0.6 — 2.1 Total current $ 39.1 $ 55.3 $ 44.5 Deferred Federal $ 1.6 $ (25.3 ) $ (2.4 ) State and local (1.1 ) (1.3 ) (0.5 ) Foreign 0.4 0.9 1.0 Total deferred $ 0.9 $ (25.7 ) $ (1.9 ) Provision (benefit) for income taxes $ 40.0 $ 29.6 $ 42.6 We recorded $0.1 million , $0.4 million and $(0.3) million of deferred tax provision (benefit) in components of other comprehensive income during the years ended December 31, 2018 , 2017 and 2016 , respectively. The following table summarizes the major differences between taxes computed at the U.S. federal statutory rate and the actual income tax provision attributable to operations: Years Ended December 31, In millions, except percentage data 2018 2017 2016 Federal statutory tax rate $ 46.6 $ 61.2 $ 30.5 State and local income taxes, net of federal benefit 4.4 2.4 2.8 Foreign income tax rate differential 1.0 0.5 0.8 Changes in valuation allowance (2.2 ) 1.7 13.2 Domestic manufacturing deduction — (5.1 ) (4.0 ) Noncontrolling interest in consolidated partnership (2.7 ) (6.6 ) (3.1 ) Nondeductible separation costs — — 1.5 Nondeductible restructuring costs — — 2.2 Federal and state tax credits (2.1 ) (0.7 ) (0.6 ) Deferred rate change (0.1 ) (0.4 ) (0.6 ) U.S. Tax Reform (1.9 ) (24.5 ) — Foreign derived intangible income (3.2 ) — — Other 0.2 1.1 (0.1 ) Provision (benefit) for income taxes $ 40.0 $ 29.6 $ 42.6 Effective tax rate 18.0 % 16.9 % 49.0 % Our effective tax rate was 18.0 percent , 16.9 percent , and 49.0 percent for the years ended December 31, 2018 , 2017 , and 2016 , respectively. The increase in our effective tax rate from 2017 to 2018 is mainly due to the one time benefit of reducing our net deferred tax liability to the 21.0 percent rate in 2017 and effects of certain provisions under U.S. Tax Reform. Our U.S. net deferred tax liabilities as of December 31, 2017 were remeasured from 35.0 percent to 21.0 percent , resulting in $24.5 million of provisional deferred income tax benefit and a reduction in our effective tax rate of 14.0 percent in 2017. During the year ended December 31, 2018, we further adjusted our net deferred tax liabilities by $1.9 million due to further interpretations of U.S. Tax Reform. The remaining difference in our effective tax rate for the years ended December 31, 2018 and 2017, respectively, is due to the change in certain favorable tax deductions under U.S. Tax Reform, such as the elimination of the domestic manufacturing deduction and the addition of the foreign-derived intangible income deduction. In addition to the impact of U.S. Tax Reform, the change in the effective tax rate period over period was also driven by the acquisition of our noncontrolling interest. The decrease in our effective tax rate from 2016 to 2017 is mainly due to the impact of U.S. Tax Reform. Our U.S. net deferred tax liabilities as of December 31, 2017 were remeasured from 35.0 percent to 21.0 percent, resulting in $24.5 million of provisional deferred income tax benefit and a reduction in our effective tax rate of 14.0 percent. The remaining difference in our effective tax rate for the years ended December 31, 2017 and 2016, respectively, is due to non-deductible transaction costs associated with the Separation in 2016, acquisition-related charges, restructuring and other (income charges) and the unfavorable results of legal entities with full valuation allowances. Excluding the impact of U.S. Tax Reform, acquisition-related charges, restructuring and other (income charges), separation costs and losses from legal entities with full valuation allowances the change in the effective tax rate period over period was primarily due to a shift in earnings mix as it relates to domestic versus foreign income earned. The significant components of deferred tax assets and liabilities are as follows: December 31, In millions 2018 2017 Deferred tax assets: Accrued restructuring $ 7.7 $ 11.4 Employee benefits 14.9 8.0 Intangibles 17.1 3.0 Investment in partnership — 1.8 Net operating losses 8.1 9.0 Start-up costs 0.8 0.8 Inventory — 1.2 Other 7.4 5.0 Total deferred tax assets $ 56.0 $ 40.2 Valuation allowance (15.5 ) (20.4 ) Total deferred tax assets, net of valuation allowance $ 40.5 $ 19.8 Deferred tax liabilities: Fixed assets $ 68.3 $ 57.1 Inventory 4.8 — Other 1.4 0.6 Total deferred tax liabilities $ 74.5 $ 57.7 Net deferred tax asset (liability) $ (34.0 ) $ (37.9 ) On December 22, 2017, U.S. Tax Reform was signed into law making significant changes to the U.S. Internal Revenue Code ("IRC"). Changes include, but are not limited to, a corporate tax rate decrease from 35.0 percent to 21.0 percent effective for tax years beginning after December 31, 2017, the transition of U.S. international taxation from a worldwide tax system to a territorial system, and implementation of tax on deemed repatriation of cumulative earnings of foreign subsidiaries. We recognized the tax effects of U.S. Tax Reform in the year ended December 31, 2017 and recorded a tax benefit of $24.5 million . This benefit pertains to the re-measurement of our deferred tax liabilities to the 21.0 percent tax rate. Also on December 22, 2017, Staff Accounting Bulletin No. 118 ("SAB 118") was issued to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of U.S. Tax Reform. We applied the guidance of SAB 118 when accounting for the enactment date effects of U.S. Tax Reform in 2017 and throughout 2018. At December 31, 2018, we have now completed our accounting for all of the enactment date income tax effects of U.S. Tax Reform. We further reduced our net deferred tax liability by an additional $1.9 million , primarily related to re-measurement of deferred taxes to the 21.0 percent rate. U.S. Tax Reform subjects a U.S. shareholder to tax on Global Intangible Low Tax Income ("GILTI") earned by certain foreign subsidiaries. The FASB Staff Q&A Topic 740, No. 5 "Accounting for Global Intangible Low-Taxed Income," states that an entity can make an accounting policy election to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future years or to provide for the tax expense related to GILTI in the year the tax is incurred as a period expense only. We have elected to account for GILTI as a current period expense when incurred. We have deferred tax assets, including net operating loss carryforwards, which are available to offset future taxable income. A valuation allowance has been provided where management has determined that it is more likely than not that the deferred tax assets will not be realized. At December 31, 2018 , foreign net operating loss carryforwards totaled $22.5 million . Of this total, $3.5 million will expire in 3 to 10 years and $19.0 million has no expiration date. Due to the global nature of our operations, a portion of our cash is held outside the U.S. The cash and cash equivalent balance at December 31, 2018 included $27.0 million held by our foreign subsidiaries. At December 31, 2018, 2017, and 2016, no deferred income taxes have been provided for our share of undistributed net earnings of foreign operations due to management’s intent to reinvest such amounts indefinitely. The determination of the amount of taxes that may be due if earnings are remitted is not practicable because such liability, if any, is dependent on circumstances that exist if and when remittance occurs. The circumstances that would affect the calculations include the source location and amount of the distribution, the underlying tax rate already paid on the earnings, foreign withholding taxes, the opportunity to use foreign tax credits, and the potential impact of U.S. Tax Reform. Positive undistributed earnings considered to be indefinitely reinvested totaled less than $1.0 million at December 31, 2018 . A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows: December 31, In millions 2018 2017 2016 Balance at beginning of year $ 0.3 $ 0.6 $ 0.7 Additions for tax positions related to current year 0.2 — — Additions for tax positions related to prior years — 0.1 0.1 Reductions for tax positions related to prior years — — (0.2 ) Reduction from lapse of statute of limitation (0.2 ) (0.4 ) — Balance at end of year $ 0.3 $ 0.3 $ 0.6 As of December 31, 2018 , 2017 , and 2016 , $0.3 million , $0.5 million , and $1.0 million , respectively, of unrecognized tax benefit, including penalties and interest, would, if recognized, impact our effective tax rate. We recognize interest accrued related to unrecognized tax benefits and penalties as income tax expense. We expect to release approximately $0.2 million in unrecognized tax benefit in the first quarter of 2019. |
Commitment and Contingencies
Commitment and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and Contingencies Lease commitments Capital leases The capital lease obligations consist of $80.0 million at December 31, 2018 and 2017 , respectively, owed to the city of Wickliffe, Kentucky, associated with Performance Materials' Wickliffe, Kentucky site, which is due at maturity in 2027. The interest rate on the $80.0 million capital lease obligation is 7.67% . Interest payments are payable semi-annually. We have a capital lease obligation due in 2031, for certain assets located at our Performance Materials' Waynesboro, Georgia manufacturing facility. The lease is with the Development Authority of Burke County (“Authority”). The Authority established the sale-leaseback of these assets by issuing an industrial development revenue bond. The bond was purchased by Ingevity and the obligations under the capital lease remain with Ingevity. Accordingly, we offset the capital lease obligation and bond on our consolidated balance sheets. Our DeRidder, Louisiana facility also had certain assets subject to a capital lease under a similar arrangement at our Waynesboro, Georgia manufacturing facility. During the fourth quarter of 2017 the capital lease associated with the assets at our DeRidder, Louisiana facility subject to the lease was terminated. Thus, as of December 31, 2017, the assets are legally owned by Ingevity and no longer subject to a lease. The leased assets are presented within "Property, plant, and equipment, net" on the consolidated balance sheets, see Note 8 for more information. Operating Leases We lease a variety of assets for use in our operations that are classified as operating leases. Our operating leases principally relate to leases for administrative offices, manufacturing equipment and buildings, warehousing and storage facilities, vehicles and rail cars. Certain leases provide for escalation of the lease payments as maintenance costs and taxes increase. Rental expense is recognized on a straight-line basis over the minimum lease term. Rental expense pursuant to operating leases was $18.4 million , $16.8 million and $17.4 million for the years ended December 31, 2018 , 2017 , and 2016 , respectively. Minimum rental payments pursuant to agreements as of December 31, 2018 , under operating leases that have non-cancelable lease terms in excess of 12 months and under capital leases are as follows: In millions Operating leases (1) Capital leases (1) 2019 $ 21.9 $ 6.1 2020 17.2 6.1 2021 13.3 6.1 2022 9.7 6.1 2023 6.0 6.1 Later years 5.9 101.5 Minimum lease payments $ 74.0 $ 132.0 Less: amount representing interest 52.0 Capital lease obligations $ 80.0 _______________ (1) Capital and operating lease obligations are presented in accordance with ASC 840. Effective January 1, 2019, we will adopt ASC 842. See Note 4 for information on the adoption and the impact to our Consolidated Financial Statements. Legal Proceedings We are, from time to time, involved in routine litigation incidental to our operations. None of the litigation in which we are currently involved, individually or in the aggregate, is material to our consolidated financial condition, liquidity or results of operations nor are we aware of any material pending or contemplated proceedings. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Ingevity’s operating segments are (i) Performance Materials and (ii) Performance Chemicals, a description of both operating segments is included in Note 1. Years Ended December 31, In millions 2018 2017 2016 Net sales Performance Materials $ 400.4 $ 349.3 $ 301.0 Performance Chemicals 733.2 623.1 607.3 Total net sales (1) 1,133.6 972.4 908.3 Segment operating profit (2) Performance Materials 147.2 122.0 106.9 Performance Chemicals 116.3 80.3 56.7 Total segment operating profit (1) 263.5 202.3 163.6 Separation costs (3) — (0.9 ) (17.5 ) Restructuring and other income (charges), net (4) 0.5 (3.7 ) (41.2 ) Acquisition and other related costs (5) (12.2 ) (7.1 ) — Pension and postretirement settlement and curtailment income (charges) (6) (0.2 ) — — Interest expense (33.2 ) (18.1 ) (19.3 ) Interest income 3.4 2.3 1.4 (Provision) benefit for income taxes (40.0 ) (29.6 ) (42.6 ) Net (income) loss attributable to noncontrolling interests (12.7 ) (18.7 ) (9.2 ) Net income (loss) attributable to Ingevity stockholders $ 169.1 $ 126.5 $ 35.2 _______________ (1) Relates to external customers only, all intersegment sales and related profit have been eliminated in consolidation. (2) Segment operating profit is defined as segment revenue less segment operating expenses (segment operating expenses consist of costs of sales, selling, general and administrative expenses and other (income) expense, net). We have excluded the following items from segment operating profit: interest expense, net associated with corporate debt facilities, income taxes, gains (or losses) on divestitures of businesses, restructuring and other (income) charges, separation costs, acquisition costs, pension and postretirement settlement and curtailment income (charges), and net income (loss) attributable to noncontrolling interest. (3) See Note 15 for more information on separation costs. (4) Information about how restructuring and other (income) charges relate to our businesses at the segment level is discussed in Note 16. (5) These charges are associated with the acquisition and integration of the Pine Chemical Business and the acquisition of the Caprolactone Business. See below for more detail on the charges incurred and Note 17 within these Consolidated Financial Statements for more information. Years Ended December 31, In millions 2018 2017 2016 Legal and professional service fees (1) $ 6.9 $ 7.1 $ — Inventory fair value step-up amortization (2) 1.4 — — Purchase price hedge adjustment (1) 3.9 — — Acquisition and other related costs $ 12.2 $ 7.1 $ — _______________ (1) Included within "Acquisition and other related costs" on the consolidated statement of operations. (2) Included within "Cost of sales" on the consolidated statement of operations. (6) Our pension and postretirement settlement and curtailment (income) charges are related to the acceleration of prior service costs, as a result of a reduction in the number of participants within the Union Hourly defined benefit pension plan during 2018. These are excluded from our segment results because we consider these costs to be outside our operational performance. We continue to include the service cost, amortization of prior service cost, interest costs, expected return on plan assets, and amortized actual gains and losses in our segment operating profit. Net sales to external customers for each of our product line is presented below. Years Ended December 31, In millions 2018 2017 2016 Performance Materials Net sales Automotive Technologies product line $ 362.0 $ 312.5 $ 263.5 Process Purification product line 38.4 36.8 37.5 Total Performance Materials Net sales (1) $ 400.4 $ 349.3 $ 301.0 _______________ (1) Sales are assigned to geographic areas based on location to which product was shipped to a third-party. Relates to external customers only, all intersegment sales and related profit have been eliminated in consolidation. Years Ended December 31, In millions 2018 2017 2016 Performance Chemicals Net sales Pavement Technologies product line $ 178.5 $ 163.0 $ 148.8 Oilfield Technologies product line 114.2 77.8 58.5 Industrial Specialties product line 440.5 382.3 400.0 Total Performance Chemicals Net sales (1) $ 733.2 $ 623.1 $ 607.3 _______________ (1) Sales are assigned to geographic areas based on location to which product was shipped to a third-party. Relates to external customers only, all intersegment sales and related profit have been eliminated in consolidation. Depreciation and amortization Capital expenditures Years Ended December 31, Years Ended December 31, In millions 2018 2017 2016 2018 2017 2016 Performance Materials $ 22.2 $ 19.8 $ 16.4 $ 65.4 $ 36.9 $ 39.6 Performance Chemicals 34.8 20.6 22.4 28.5 15.7 17.1 Total $ 57.0 $ 40.4 $ 38.8 $ 93.9 $ 52.6 $ 56.7 Property, plant, and equipment, net December 31, In millions 2018 2017 North America $ 444.4 $ 358.4 Asia Pacific 78.7 79.3 Europe, Middle East and Africa 0.6 0.7 South America 0.1 0.1 Property, plant, and equipment, net $ 523.8 $ 438.5 Total assets December 31, In millions 2018 2017 Performance Materials $ 547.8 $ 438.9 Performance Chemicals 755.7 479.8 Total segment assets (1) $ 1,303.5 $ 918.7 Corporate and other 11.7 10.9 Total assets $ 1,315.2 $ 929.6 _______________ (1) Segment assets exclude assets not specifically managed as part of one specific segment herein referred to as "Corporate and other." |
Earnings (Loss) per Share
Earnings (Loss) per Share | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) per Share | Earnings (Loss) per Share Basic earnings (loss) per share is computed by dividing net income (loss) for the period by the weighted average number of common shares outstanding during the period. The weighted average number of common shares outstanding for basic and diluted earnings (loss) per share for the year ended December 31, 2016 was based on the weighted average number of common shares outstanding for the period beginning after the Distribution Date. On May 15, 2016, the Distribution Date, each holder of WestRock's common stock received one share of Ingevity's common stock for every six shares of WestRock's common stock held on the Record Date. Diluted earnings (loss) per share is computed by dividing net income (loss) for the period by the weighted average number of shares of common stock and potentially dilutive common stock outstanding for the period. The calculation of diluted net income per share excludes all anti-dilutive common shares. Years Ended December 31, In millions (except share and per share data) 2018 2017 2016 Net income (loss) attributable to Ingevity stockholders $ 169.1 $ 126.5 $ 35.2 Basic and Diluted earnings (loss) per share (1) Basic earnings (loss) per share $ 4.02 $ 3.00 $ 0.83 Diluted earnings (loss) per share $ 3.97 $ 2.97 $ 0.83 Shares (2) Weighted average number of shares of common stock outstanding - Basic 42,037 42,130 42,108 Weighted average additional shares assuming conversion of potential common shares 564 399 163 Shares - diluted basis 42,601 42,529 42,271 _______________ (1) Diluted earnings (loss) per share is calculated using net income (loss) available to common stockholders divided by diluted weighted-average shares of common shares outstanding during each period, which includes the dilutive effect of outstanding equity awards. Basic and diluted earnings (loss) per share for the year ended December 31, 2016 is calculated using the weighted average number of common shares outstanding for the period beginning after the Distribution Date. (2) Shares are presented in thousands. The following average number of potential common shares were antidilutive and, therefore, were not included in the diluted earnings per share calculation: Years Ended December 31, In thousands 2018 2017 2016 Average number of potential common shares - antidilutive 84 79 4 |
Supplemental Information
Supplemental Information | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Information | Supplemental Information The following tables include details of prepaid and other current assets, other assets, accrued expenses and other liabilities as presented on the consolidated balance sheets, as well as other (income) expense, net on the consolidated statement of operations: Prepaid and other current assets: December 31, In millions 2018 2017 Income and value added tax receivables $ 15.0 $ 8.2 Prepaid freight and supply agreements 1.1 0.8 Prepaid insurance 1.7 1.3 Non-trade receivables 3.4 2.4 Advances to suppliers 1.5 0.8 Equity securities, foreign currency, commodity hedging (Note 6) 0.7 1.8 Contract asset (Note 5) 5.1 — Other 6.4 5.5 $ 34.9 $ 20.8 Other assets: December 31, In millions 2018 2017 Deferred financing charges $ 3.1 $ 2.7 Capitalized software, net (Note 3) 9.5 12.5 Land-use rights 5.6 6.0 Planned major maintenance activities (Note 3) 3.2 2.1 Deferred compensation plan assets 4.4 — Other 12.5 7.1 $ 38.3 $ 30.4 Accrued expenses: December 31, In millions 2018 2017 Accrued interest $ 8.5 $ 3.1 Accrued taxes 3.0 1.7 Accrued freight 5.1 1.9 Accrued rebates 6.4 4.9 Restructuring reserves (Note 16) — 0.2 Separation-related reimbursement awards (Notes 6) 0.1 0.9 Accrued royalties and commissions 1.8 1.7 Foreign currency hedging (Note 6) 3.9 — Other 7.9 5.6 $ 36.7 $ 20.0 Other liabilities: December 31, In millions 2018 2017 Deferred compensation arrangements (Note 6) $ 4.6 $ 2.0 Pension & OPEB liabilities (Note 14) 7.5 7.0 Unrecognized tax benefits (Note 18) 0.3 0.3 Other 2.7 3.9 $ 15.1 $ 13.2 Other (income) expense, net: Years Ended December 31, In millions 2018 2017 2016 Foreign currency translation (gain)/loss $ 2.0 $ 1.2 $ (2.9 ) Royalty (income)/expense (0.8 ) (0.7 ) (1.0 ) Other (gain)/loss (0.2 ) — 0.7 $ 1.0 $ 0.5 $ (3.2 ) |
Quarterly Financial Information
Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information (Unaudited) | Quarterly Financial Information (Unaudited) The following is a summary of the quarterly results of operations for the years ended December 31, 2018 , and 2017 . 2018 2017 In millions, except earnings per share amounts 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Net sales $ 235.2 $ 308.6 $ 311.2 $ 278.6 $ 218.5 $ 260.3 $ 264.1 $ 229.5 Gross profit 85.1 115.5 118.6 97.6 70.7 89.8 93.2 75.3 Income (loss) before taxes 45.5 64.6 68.1 43.6 34.0 53.0 55.1 32.7 Net income (loss) 35.8 52.2 51.7 42.1 23.0 35.8 38.4 48.0 Less: Net income (loss) attributable to noncontrolling interests 5.0 5.5 2.2 — 4.0 3.7 4.6 6.4 Net income (loss) attributable to Ingevity stockholders $ 30.8 $ 46.7 $ 49.5 $ 42.1 $ 19.0 $ 32.1 $ 33.8 $ 41.6 Basic earnings (loss) per common share attributable to Ingevity stockholders $ 0.73 $ 1.11 $ 1.18 $ 1.01 $ 0.45 $ 0.76 $ 0.80 $ 0.98 Diluted earnings (loss) per common share attributable to Ingevity stockholders (1) $ 0.72 $ 1.10 $ 1.16 $ 0.99 $ 0.45 $ 0.76 $ 0.79 $ 0.97 Weighted average shares outstanding Basic 42.1 42.1 42.0 41.9 42.1 42.1 42.1 42.1 Diluted 42.6 42.6 42.7 42.5 42.4 42.4 42.5 42.6 _______________ (1) Basic and diluted earnings (loss) per share are calculated using the weighted average number of common shares outstanding for the period. The sum of quarterly earnings per common share may differ from the full-year amount. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Event Perstorp AB's Caprolactone Business On December 10, 2018, we entered into an agreement for the Sale and Purchase of Perstorp UK Ltd. (the “Caprolactone Agreement”) with Perstorp Holding AB, a company registered in Sweden, that develops, manufactures, and sells specialty chemicals (the “Seller”). Pursuant to the Caprolactone Agreement, we agreed to purchase the shares held by the Seller in Perstorp UK Ltd., including the Seller’s entire caprolactone business, in exchange for €570.9 million , less assumed debt and other miscellaneous transaction costs, as further defined in the Caprolactone Agreement (the “Purchase Price”), plus interest accrued on the Purchase Price (herein referred to as the “Caprolactone Acquisition”). On February 13, 2019, pursuant to the terms and conditions set forth in the Caprolactone Agreement, we completed the Caprolactone Acquisition for an aggregate preliminary purchase price of €578.9 million ( $652.5 million ) excluding net debt to be assumed of €100.4 million ( $113.1 million ). At closing, the assumed net debt was settled with an affiliate of the counterparty, Perstorp Holding AB. Beginning in the first quarter of 2019, the Caprolactone Acquisition will be integrated into our Performance Chemicals segment and included within our Engineered Polymers product line. Our revolving credit facility was utilized as the primary source of funds, along with available cash on hand, to close our Caprolactone Acquisition. Our available capacity under our revolving credit facility immediately following this drawdown was $113.1 million . Caprolactone Acquisition is considered a business under business combinations accounting guidance, and therefore we will apply acquisition accounting. Acquisition accounting requires, among other things, that assets and liabilities assumed be recognized at their fair values as of the acquisition date. The net assets of the Caprolactone Acquisition will be recorded at the estimated fair values using primarily Level 2 and Level 3 inputs (see Note 17 for an explanation of Level 2 and 3 inputs). We have performed a preliminary valuation of the fair value of the acquired assets and liabilities assumed. Based on this preliminary allocation of the purchase price, we believe the primary assets acquired and their estimated values are; goodwill of approximately $310 million and tangible and intangible assets of approximately $220 million . This preliminary assessment of fair value is based on draft reports from our valuation experts and is subject to change based on its preliminary nature. Once our detailed preliminary purchase price valuation is completed, we will include the required additional details in our future filings. We have not completed the detailed analysis to present the pro forma financial information for the combined companies. Thus, the pro forma financial information will be included in our future filings as well. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts and Reserves | 12 Months Ended |
Dec. 31, 2018 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Valuation and Qualifying Accounts and Reserves | SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES FOR YEARS ENDED DECEMBER 31, 2018, 2017, and 2016 Provision/ (Benefit) (in millions) Balance, Beginning of Year Charged to Costs and Expenses Charged to Other Comprehensive Income Write-offs (1) Balance, End of Year December 31, 2018 Reserve for doubtful accounts (2) $ 0.4 — — — $ 0.4 Deferred tax valuation allowance $ 20.4 (2.6 ) (2.3 ) — $ 15.5 December 31, 2017 Reserve for doubtful accounts (2) $ 0.3 0.1 — — $ 0.4 Deferred tax valuation allowance $ 18.8 1.7 (0.1 ) — $ 20.4 December 31, 2016 Reserve for doubtful accounts (2) $ 0.1 0.2 — — $ 0.3 Deferred tax valuation allowance $ 6.6 13.2 (1.0 ) — $ 18.8 _______________ (1) Write-offs are net of recoveries. (2) Reserve for doubtful accounts is included within Accounts receivable, net on the consolidated balance sheet. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Estimates and assumptions | Estimates and assumptions: We are required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results are likely to differ from those estimates, but we do not believe such differences will materially affect our financial position, results of operations or cash flows. |
Cash equivalents | Cash equivalents: Highly liquid securities with an original maturity of three months or less are considered to be cash equivalents. |
Accounts receivable and allowance for doubtful accounts | Accounts receivable and allowance for doubtful accounts: Accounts receivable, net on the consolidated balance sheets are comprised of trade receivable less allowances for doubtful accounts. Trade receivables consist of amounts owed to Ingevity from customer sales and are recorded at the invoiced amounts when revenue is recognized and generally do not bear interest. The allowance for doubtful accounts is our best estimate of the amount of probable loss in the existing accounts receivable. We determine the allowance based on historical write-off experience, current collection trends, and external business factors such as economic factors, including regional bankruptcy rates, and political factors. Past due balances over a specified amount are reviewed individually for collectability. Account balances are charged off against the allowance when it is probable that the receivable will not be recovered. |
Concentration of credit risk | Concentration of credit risk: The financial instruments that potentially subject Ingevity to concentrations of credit risk are accounts receivable. We limit our credit risk by performing ongoing credit evaluations and, when necessary, requiring letters of credit, guarantees or collateral. |
Inventories, net | Inventories, net: Inventories are valued at net realizable value. Cost is determined using the last-in, first-out method (“LIFO”) for substantially all raw materials, finished goods and production materials of U.S. manufacturing operations. Cost of all other inventories, including stores and supplies inventories and inventories of non-U.S. manufacturing operations, is determined by the first-in, first-out ("FIFO") or average cost methods. |
Property, plant and equipment | Property, plant, and equipment: Owned assets are recorded at cost. Also included in the cost of these assets is interest on funds borrowed during the construction period. When assets are sold, retired or disposed of, their cost and related accumulated depreciation are removed from the consolidated balance sheet and any resulting gain or loss is reflected in cost of sales. Repair and maintenance costs that materially add to the value of the asset or prolong its useful life are capitalized and depreciated based on the extension of the useful life; general costs of maintenance and repairs are charged to expense. |
Depreciation | Depreciation: The cost of plant and equipment is depreciated, utilizing the straight-line method, over the estimated useful lives of the assets, the majority of which range from 20 to 40 years for buildings and leasehold improvements and 5 to 30 years for machinery and equipment. The following table provides the detail behind the useful lives and proportion of our machinery and equipment (“M&E”) in each useful life category. Percent of Depreciable Life in Years Types of Assets 56 20 Production vessels and kilns, storage tanks, piping 11 15 Control systems, instrumentation, metering equipment 7 25 to 30 Blending equipment, storage tanks, piping, shipping equipment and platforms, safety equipment 19 5 to 10 Production control system equipment and hardware, laboratory testing equipment 3 40 Machinery & equipment support structures and foundations 4 Various Various |
Impairment of long-lived assets | Impairment of long-lived assets: We periodically evaluate whether current events or circumstances indicate that the carrying value of our long-lived assets, including intangible assets, to be held and used may not be recoverable. If such circumstances are determined to exist, an estimate of undiscounted future cash flows produced by the long-lived asset, or the appropriate grouping of assets, is compared to carrying value to determine whether impairment exists. If an asset is determined to be impaired, the loss is measured based on quoted market prices in active markets, if available. If quoted market prices are not available, the estimate of fair value is based on various valuation techniques, including a discounted value of estimated future cash flows. We report an asset to be disposed of at the lower of its carrying value or its estimated net realizable value. |
Goodwill and other intangible assets | Goodwill and other intangible assets: Goodwill represents the excess of cost of an acquired business over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination. We review the recorded value of goodwill at least annually at October 1, or sooner if events or changes in circumstances indicate that the fair value of a reporting unit is below its carrying value. A reporting unit is the level at which discrete financial information is available and reviewed by business management on a regular basis. An impairment exists when the carrying value of a reporting unit exceeds its fair value. Our reporting units are our operating segments, i.e. Performance Chemicals and Performance Materials. If an indication exists that the fair value of a reporting unit with goodwill is less than its carrying value, a quantitative goodwill impairment test is performed. The fair value of each reporting unit is estimated primarily using an income approach, specifically the discounted cash flow method. The following assumptions are key to the income approach: 1) cash flow and earnings projections; 2) growth rates; 3) discount rates; 4) income tax rates; and, 5) terminal value rates. The factors we considered in developing our estimates and projections for cash flows and earnings include, but are not limited to, the following: (i) macroeconomic conditions; (ii) industry and market considerations; (iii) costs, such as increases in raw materials, labor, or other costs; (iv) our overall financial performance; and, (v) other relevant entity-specific events that impact our reporting units. The discount rate we used represents the weighted average cost of capital for the reporting units, considering the risks and uncertainty inherent in the cash flows of the reporting units and in our internally-developed forecasts. The determination of whether goodwill is impaired involves a significant level of judgment in the assumptions underlying the approach used to determine the estimated fair values of our reporting units. We believe that the assumptions and rates used in our impairment assessment are reasonable; however, these assumptions are judgmental and variations in any assumptions could result in materially different calculations of fair value. We will continue to evaluate goodwill on an annual basis as of October 1, and whenever events or changes in circumstances, such as significant adverse changes in operating results, market conditions, or changes in management’s business strategy indicate that there may be a probable indicator of impairment. It is possible that the assumptions used by management related to the evaluation may change or that actual results may vary significantly from management’s estimates. Other intangible assets are comprised of finite-lived intangible assets consisting primarily of brands: representing trademarks, trade names and know-how, and customer contracts and relationships. Other intangible assets are amortized over their estimated useful lives which range from 5 to 20 years. |
Capitalized software | Capitalized software: Capitalized software for internal use is included in "Other assets" on the consolidated balance sheets. Amounts capitalized are presented in "Capital expenditures" on our consolidated statements of cash flow. Capitalized software is amortized using the straight-line over the estimated useful lives ranging from 1 to 10 years. Amortization is recorded to "Costs of sales" on our consolidated statements of operations for software directly used in the production of inventory and "Selling, general and administrative expenses" on our consolidated statements of operations for software used for non-production related activities. |
Environmental and legal liabilities | Environmental and legal liabilities: Environmental expenditures that increase useful lives of assets are capitalized, while other environmental expenditures are expensed. Liabilities are recorded when remedial efforts are probable and the costs can be reasonably estimated. We recognize a liability for other legal contingencies when a loss is probable and reasonably estimable. Liabilities recorded for claims are limited to pending cases based on Ingevity’s historical experience, consultation with outside counsel and consultation with an actuarial specialist concerning the feasibility of reasonably estimating liabilities associated with claims that may arise in the future. We recognized insurance recoveries when collection is reasonably assured. Third-party fees for legal services are expensed as incurred. |
Revenue recognition and Cost of sales | Revenue recognition: In May 2014, the FASB issued ASU 2014-09 “Revenue from Contracts with Customers (Topic 606),” which supersedes both the revenue recognition requirement to ASC 605 “Revenue Recognition” and most industry-specific guidance. The core principle of the new standard (ASC 606) is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. An entity must also disclose sufficient information to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative information about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. In 2016 and 2017, the FASB issued several ASUs that provided additional clarity on numerous topics as well as providing technical corrections to ASU 2014-09. We adopted this new standard on January 1, 2018, utilizing the modified retrospective method applied to those contracts, which were not completed as of that date. Results for reporting periods beginning after January 1, 2018, are presented under ASC 606, while prior period amounts are not adjusted and continue to be presented in accordance with our historic accounting under ASC 605. Substantially all our revenue is recognized when products are shipped from our manufacturing and warehousing facilities, which represents the point at which control is transferred to the customer. For certain limited contracts, where we are producing goods with no alternative use and for which we have an enforceable right to payment for performance completed to date, we are recognizing revenue as goods are manufactured, rather than when they are shipped. Sales net of returns and customer incentives are based on the sale of manufactured products. Net sales are recognized when obligations under the terms of a contract with our customer are satisfied; generally, this occurs with the transfer of control of our products. Since Net sales are derived from product sales only, we have disaggregated our net sales by our product lines within each reportable segment. Net sales are measured as the amount of consideration we expect to receive in exchange for transferring goods. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. Sales returns and allowances are not a normal practice in the industry and are not significant. Certain customers may receive cash-based incentives, including discounts and volume rebates, which are accounted for as variable consideration and included in Net sales. Shipping and handling fees billed to customers continue to be included with Net sales. If we pay for the freight and shipping, we recognize the cost when control of the product has transferred to the customer as an expense in Cost of sales in the consolidated statement of operations. Although very rare, from time to time we incur expenses to obtain a sales contract. In these cases, if these costs are for orders that are fulfilled in one year or less, we expense these costs as they are incurred. Because the period between when we transfer a promised good to a customer and when the customer pays for that good will be one year or less, we elect not to adjust the promised amount of consideration for the effects of any financing component, as it is not significant. Cost of sales: Costs primarily consists of the cost of inventory sold and other production related costs. These costs include raw materials, direct labor, manufacturing overhead, packaging costs and maintenance costs. Shipping and handling costs are also recorded to cost of sales. |
Selling, general and administrative expenses | Selling, general and administrative expenses: Costs are expensed as incurred and primarily include employee compensation costs related to sales, and office personnel, office expenses, and other expenses not directly related to our manufacturing operations. Costs also include advertising and promotional costs. |
Research and technical expenses | Research and technical expenses: Cost are expensed as incurred and primarily include employee compensation, technical equipment costs and material testing and innovation related expenses. |
Royalty expense | Royalty expense: Our Performance Materials and Performance Chemicals segments have licensing agreements with third parties requiring us to pay royalties for certain technologies we use in the manufacturing of our products. Royalty expense is recognized as incurred and recorded to "Cost of sales" on our consolidated statements of operations. |
Income taxes | Income taxes: We are subject to income taxes in the U.S. and numerous foreign jurisdictions, including China. The provision (benefit) for income taxes includes income taxes paid, currently payable or receivable, and deferred taxes. We follow the liability method of accounting for income taxes in accordance with current accounting standards regarding the accounting for income taxes. Under this method, deferred income taxes are recorded based upon the differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws in effect at the time the underlying assets or liabilities are recovered or settled. The ability to realize deferred tax assets is evaluated through the forecasting of taxable income, historical and projected future operating results, the reversal of existing temporary differences, and the availability of tax planning strategies. Valuation allowances are recognized to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. We do not provide income taxes on undistributed earnings of consolidated foreign subsidiaries as it is our intention that such earnings will remain invested in those companies. See Note 18 for more information. We recognize income tax positions that are more likely than not to be realized and accrue interest related to unrecognized income tax positions, which is included as a component of the provision (benefit) for income taxes on the consolidated statements of operations. Prior to the Separation, activity of our U.S. operations were reported in WestRock’s U.S. consolidated income tax return and certain foreign activity was reported in WestRock tax paying entities in those jurisdictions. Under the TMA, WestRock is responsible for the income tax liabilities associated with all U.S. operations prior to Separation and for the historic operations of certain foreign legal entities retained by WestRock after the Separation. For periods prior to the Separation, the provision (benefit) for income taxes included in the Consolidated Financial Statements, related to domestic and certain foreign operations, was calculated on a separate return basis, as if Ingevity was a separate taxpayer and the resulting current tax receivable or liability, including any liabilities related to uncertain tax positions, was settled with WestRock through equity at Separation. In other foreign taxing jurisdictions, the operations of Ingevity were always conducted in discrete legal entities, each of which files separate tax returns, and all resulting income tax assets and liabilities, including any liabilities related to uncertain tax positions, are reflected in the consolidated balance sheets of Ingevity. |
Pension and postretirement benefits | Pension and postretirement benefits: Prior to the Separation, the employees of Ingevity were participants in various defined benefit pension and postretirement benefit plans (“the Plans”) sponsored by WestRock and the related assets and liabilities were combined with those related to other WestRock businesses. Expense allocated under the Plans was reported within Cost of sales and Selling, general and administrative expenses in the consolidated statements of operation. Prior to the Separation, the Plans were considered to be part of a multi-employer plan with the other businesses of WestRock. In conjunction with the Separation, the employees of Ingevity stopped participating in WestRock pension and post-retirement benefit plans. We assumed certain domestic and international pension and other post retirement benefit obligations from WestRock on the date of Separation. We established new qualified and non-qualified benefit plans to continue the pension and postretirement benefits provided to its employees and retirees based on the obligations assumed from WestRock. The expense related to the current employees of Ingevity as well as the expense related to retirees of Ingevity are included in the Consolidated Financial Statements. The costs (or benefits) and obligations related to these benefits reflect key assumptions related to general economic conditions, including interest (discount) rates, healthcare cost trend rates and expected return on plan assets. The costs (or benefits) and obligations for these benefit programs are also affected by other assumptions, such as average retirement age, mortality, employee turnover, and plan participation. To the extent our plans' actual experience, as influenced by changing economic and financial market conditions or by changes to our own plans' demographics, differs from these assumptions, the costs and obligations for providing these benefits, as well as the plans' funding requirements, could increase or decrease. When actual results differ from our assumptions, the difference is typically recognized over future periods. In addition, the unrealized gains and losses related to our pension and postretirement benefit obligations may also affect periodic benefit costs (or benefits) in future periods. See Note 14 for additional information. |
Share-based compensation | Share-based compensation: We recognize compensation expense in our Consolidated Financial Statements for all share-based compensation arrangements. Share-based compensation cost is measured at the date of grant, based on the fair value of the award and expense is recognized over the grantee's requisite service period; forfeitures are recognized as they occur. We calculate the fair value of our stock options using the Black-Scholes option pricing model. The fair value of restricted stock units ("RSU"s), non-employee director deferred stock units ("DSU"s) and performance-based restricted stock units ("PSU"s) is determined using our closing stock price on the day of the grant. Substantially all compensation expense related to share-based awards is recorded as a component of Selling, general and administrative expenses in the Consolidated Statements of Operations. See Note 11 for additional information |
Operating segments | Operating segments: Ingevity’s operating segments are Performance Materials and Performance Chemicals. Our operating segments were determined based upon the nature of the products produced, the nature of the production process, the type of customer for the products, the similarity of economic characteristics, and the manner in which management reviews results. Ingevity’s chief operating decision maker evaluates the business at the segment level when making decisions about allocating resources and assessing performance of Ingevity as a whole. We evaluate sales in a format consistent with our reportable segments: (1) Performance Materials, which includes wood-based, chemically activated carbon products and (2) Performance Chemicals, which includes specialty pine-based chemical co-products derived from the kraft pulping process and caprolactone monomers and derivatives derived from cyclohexanone and hydrogen peroxide. Each segment operates as a portfolio of various end uses for the relevant raw material used in that segment. Business decisions are made and performance is generally measured based upon the total mix of end uses each raw material is being directed at in the segment. |
Derivative financial instruments | Derivative financial instruments: We mitigate certain financial exposures, including currency risk and commodity price exposures, through a controlled program of risk management that includes the use of derivative financial instruments. We formally document all relationships between the derivative financial instrument and hedged item, as well as the risk management objective and strategy for undertaking various hedge transactions. This process includes relating derivative financial instruments that are designated as cash flow hedges to specific forecasted transactions. We do not hold or issue derivative financial instruments for speculative or trading purposes. We enter into derivative financial instruments which are governed by policies, procedures and internal processes set forth by our Board of Directors. On the date the derivative financial instrument is entered into, we generally designate the derivative as a hedge of the variability of cash flows to be received or paid related to a forecasted transaction (cash flow hedge). Cash flow hedges are derivative financial instruments designated as and used to hedge the exposure to variability in expected future cash flows that are attributable to a particular risk. The derivative financial instruments that are designated and qualify as a cash flow hedge are recorded on the balance sheet at fair value and the changes in fair value of these hedging instruments are offset in part or in whole by corresponding changes in the anticipated cash flows of the underlying exposures being hedged. Where we have a legal right to offset derivative settlements under a master netting agreement with a counterparty, derivatives with that counterparty are presented on a net basis. The gains and losses arising from qualifying hedging instruments are reported as a component of accumulated other comprehensive income (loss) (“AOCI”) located in the consolidated balance sheets and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The reclassification gain or losses of the hedge from AOCI are recorded in the same financial statement caption on the consolidated statements of operations as the hedged item. For example, designated cash flow hedges entered to minimize foreign currency exchange risk of forecasted revenue transactions are recorded to "Net sales" on the consolidated statement of operations when the forecasted transaction occurs. Designated commodity cash flow hedges gains or losses recorded in AOCI are recognized in "Cost of sales" on the consolidated statements of operations when the inventory is sold. See Note 6 for more information regarding our derivative financial instruments. |
Noncontrolling interests | Noncontrolling interests: When our ownership in a consolidated legal entity is less than 100 percent, the outside stockholders' interests are shown as noncontrolling interests. Our noncontrolling interests for the years ended December 31, 2018 , 2017 and 2016 , represents the 30 percent ownership interest held by a third-party U.S. based company in our consolidated Purification Cellutions, LLC legal entity. Purification Cellutions, LLC is the legal entity that owns technology associated with, and manufactures, our extruded honeycomb scrubber products within our Performance Materials segment. Net income (loss) attributable to noncontrolling interest, as presented on our consolidated statement of operations represents 30 percent of the pre-tax earnings from Purification Cellutions, LLC owned by the third-party. Purification Cellutions, LLC is a limited liability company which is treated as a "pass-through" entity for tax purposes. Although we consolidated 100 percent of Purification Cellutions, LLC, only 70 percent of Purification Cellutions, LLC's earnings are included in the calculation of Ingevity's provision for income taxes as presented on the consolidated statement of operations. |
Translation of foreign currencies | Translation of foreign currencies: The local currency is the functional currency for all of Ingevity’s significant operations outside the U.S. The assets and liabilities of Ingevity's foreign subsidiaries are translated into U.S. dollars using period-end exchange rates, and adjustments resulting from these financial statement translations are included in accumulated other comprehensive income in the consolidated balance sheets. Revenues and expenses are translated at average rates prevailing during each period. |
Business Combinations | Business Combinations: We account for business combinations in accordance with ASC 805 “Business Combinations” which requires, among other things, the acquiring entity in a business combination to recognize the fair value of the assets acquired and liabilities assumed; the recognition of acquisition-related costs in the consolidated results of operations; the recognition of restructuring costs in the consolidated results of operations for which the acquirer becomes obligated after the acquisition date; and contingent purchase consideration to be recognized at fair value on the acquisition date with subsequent adjustments recognized in the consolidated results of operations. We generally use third-party qualified consultants to assist management in determination of the fair value of assets acquired and liabilities assumed. This includes, when necessary, assistance with the determination of lives and valuation of property and identifiable intangibles, assisting management in determining the fair value of obligations associated with employee related liabilities and assisting management in assessing obligations associated with legal and environmental claims. The fair values assigned to identifiable intangible assets acquired are determined primarily by using an income approach, which is based on assumptions and estimates made by management. Significant assumptions utilized in the income approach are the attrition rate, growth rates and discount rate. These assumptions are based on company specific information and projections, which are not observable in the market and are therefore considered Level 2 and Level 3 measurements. The excess of the purchase price over the fair value of the identified assets and liabilities is recorded as goodwill. Based on the acquired business’ end markets and products as well as how the chief operating decision maker will review the business results determines the most appropriate operating segment for which to integrate the acquired business. Goodwill acquired, if any, is allocated to the reporting unit within or at the operating segment for which the acquired business will be integrated. Operating results of the acquired entity are reflected in the consolidated financial statements from date of acquisition. |
Reclassifications | Reclassifications: Certain prior year amounts have been reclassified to conform with current year's presentation. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Property, Plant and Equipment | The following table provides the detail behind the useful lives and proportion of our machinery and equipment (“M&E”) in each useful life category. Percent of Depreciable Life in Years Types of Assets 56 20 Production vessels and kilns, storage tanks, piping 11 15 Control systems, instrumentation, metering equipment 7 25 to 30 Blending equipment, storage tanks, piping, shipping equipment and platforms, safety equipment 19 5 to 10 Production control system equipment and hardware, laboratory testing equipment 3 40 Machinery & equipment support structures and foundations 4 Various Various Property, plant and equipment, net consist of the following: December 31, In millions 2018 2017 Machinery and equipment $ 857.2 $ 792.5 Buildings and leasehold equipment 113.1 115.0 Land and land improvements 19.6 18.0 Construction in progress 71.2 35.8 Total cost 1,061.1 961.3 Less: accumulated depreciation (537.3 ) (522.8 ) Property, plant and equipment, net (1) $ 523.8 $ 438.5 _______________ (1) This includes capital leases related to machinery and equipment at our Wickliffe, Kentucky facility of $69.2 million and $70.0 million , and net book value of $6.7 million and $7.6 million at December 31, 2018 and 2017 , respectively. This also includes capital leases related to our Waynesboro, Georgia manufacturing facility for (a) machinery and equipment of $6.5 million and $5.9 million and net book value of $6.0 million and $5.7 million , (b) construction in progress of $13.7 million and $2.1 million and (c) buildings and leasehold improvements of $0.1 million and zero at December 31, 2018 and 2017 , respectively. Amortization expense associated with these capital leases is included within depreciation expense. The payments remaining under these capital leases obligations are included within Note 19. |
New Accounting Guidance (Tables
New Accounting Guidance (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | In millions Balance at December 31, 2017 Adjustments Balance at January 1, 2018 Assets Accounts receivable, net of allowance $ 100.0 $ 0.3 $ 100.3 Inventories, net 160.0 (2.4 ) 157.6 Prepaid and other current assets 20.8 5.1 25.9 Liabilities Accrued expenses 20.0 0.9 20.9 Deferred income taxes 41.3 0.5 41.8 Equity Retained earnings $ 142.8 $ 1.6 $ 144.4 In accordance with ASC 606, the impact of adoption on our consolidated statement of operations and balance sheet were as follows: Year Ended December 31, 2018 In millions As reported Balances without Adoption of ASC 606 Effect of Change Higher/(Lower) Net sales $ 1,133.6 $ 1,133.0 $ 0.6 Cost of sales 716.8 717.1 (0.3 ) Provision (benefit) for income taxes 40.0 39.8 0.2 Net income (loss) $ 169.1 $ 168.4 $ 0.7 December 31, 2018 In millions As reported Balances without Adoption of ASC 606 Effect of Change Higher/(Lower) Assets Accounts receivable, net of allowance $ 118.9 $ 118.5 $ 0.4 Inventories, net 191.4 193.6 (2.2 ) Prepaid and other current assets 34.9 29.2 5.7 Liabilities — Accrued expenses 36.7 35.7 1.0 Deferred income taxes 36.9 36.7 0.2 Equity Retained earnings $ 313.5 $ 310.8 $ 2.7 |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following tables present our Net sales disaggregated by product line and geography. Years Ended December 31, In millions 2018 2017 2016 Automotive Technologies product line $ 362.0 $ 312.5 $ 263.5 Process Purification product line 38.4 36.8 37.5 Performance Materials segment $ 400.4 $ 349.3 $ 301.0 Pavement Technologies product line 178.5 163.0 148.8 Oilfield Technologies product line 114.2 77.8 58.5 Industrial Specialties product line 440.5 382.3 400.0 Performance Chemicals segment $ 733.2 $ 623.1 $ 607.3 Consolidated Net sales $ 1,133.6 $ 972.4 $ 908.3 The following table presents our Net sales disaggregated by geography, based on the delivery address of our customer. Years Ended December 31, In millions 2018 2017 2016 North America $ 770.4 $ 662.9 $ 597.8 Asia Pacific 171.4 142.5 138.8 Europe, Middle East and Africa 169.9 149.2 151.1 South America 21.9 17.8 20.6 Net sales $ 1,133.6 $ 972.4 $ 908.3 |
Contract with Customer, Asset and Liability | The following table provides information about contract assets and contract liabilities from contracts with customers. The contract assets primarily relate to our rights to consideration for products produced but not billed at the reporting date on contracts with certain customers. The contract assets are recognized as accounts receivables when the rights become unconditional and the customer has been billed. Contract liabilities represent obligations to transfer goods to a customer for which we have received consideration from our customer. For all periods presented, we had no contract liabilities. In millions Contract Asset Balance at January 1, 2018 $ 4.4 Contract asset additions 26.6 Reclassification to accounts receivable, billed to customers (25.9 ) Balance at December 31, 2018 (1) $ 5.1 _______________ (1) Included within "Prepaid and other current assets" on the consolidated balance sheet. |
Financial Instruments, Risk M_2
Financial Instruments, Risk Management, and Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements, Recurring | The following information is presented for assets and liabilities that are recorded in the consolidated balance sheets at fair value measured on a recurring basis. There were no significant transfers of assets and liabilities that are recorded at fair value between Level 1 and Level 2 during the period reported. In millions Level 1 (1) Level 2 (2) Level 3 (3) Total December 31, 2018 Assets: Equity securities (4) $ 0.4 $ — $ — $ 0.4 Foreign currency hedging (4) — 0.2 — 0.2 Commodity hedging (4) — 0.1 — 0.1 Deferred compensation plan investments (5) 1.3 — — 1.3 Total assets $ 1.7 $ 0.3 $ — 2.0 Liabilities: — Deferred compensation arrangement (5) $ 4.6 $ — $ — $ 4.6 Separation-related reimbursement awards (6)(7) 0.1 — — 0.1 Foreign currency hedging (6) — 3.9 — 3.9 Commodity hedging (6) — 0.1 — 0.1 Total liabilities $ 4.7 $ 4.0 $ — $ 8.7 In millions Level 1 (1) Level 2 (2) Level 3 (3) Total December 31, 2017 Assets: Equity securities (4) $ 1.8 $ — $ — $ 1.8 Total assets $ 1.8 $ — $ — 1.8 Liabilities: — Deferred compensation arrangement (5)(8) $ 2.0 $ — $ — $ 2.0 Separation-related reimbursement awards (6)(7) 0.9 — — 0.9 Total liabilities $ 2.9 $ — $ — $ 2.9 __________ (1) Quoted prices in active markets for identical assets. (2) Quoted prices for similar assets and liabilities in active markets. (3) Significant unobservable inputs. (4) Included within "Prepaid and other current assets" on the consolidated balance sheet. (5) Included within "Other liabilities" on the consolidated balance sheet. (6) Included within "Accrued expenses" on the consolidated balance sheet. (7) This amount represents an amount due to WestRock associated with WestRock equity awards held by Ingevity employees post Separation. In accordance with the EMA between Ingevity and WestRock entered into in connection with the Separation, we are required to reimburse WestRock the fair market value of awards on the day Ingevity employees exercise their awards. The income and expense, respectively, recognized during the years ended December 31, 2018 , 2017 , and 2016 was $0.1 million , $0.3 million , and $1.6 million , respectively. |
Inventories, net (Tables)
Inventories, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | December 31, In millions 2018 2017 Raw materials $ 36.5 $ 40.1 Production materials, stores and supplies 17.5 13.4 Finished and in-process goods 144.7 114.3 Subtotal 198.7 167.8 Less: excess of cost over LIFO cost (7.3 ) (7.8 ) Inventories, net $ 191.4 $ 160.0 |
Property, Plant and Equipment_2
Property, Plant and Equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | The following table provides the detail behind the useful lives and proportion of our machinery and equipment (“M&E”) in each useful life category. Percent of Depreciable Life in Years Types of Assets 56 20 Production vessels and kilns, storage tanks, piping 11 15 Control systems, instrumentation, metering equipment 7 25 to 30 Blending equipment, storage tanks, piping, shipping equipment and platforms, safety equipment 19 5 to 10 Production control system equipment and hardware, laboratory testing equipment 3 40 Machinery & equipment support structures and foundations 4 Various Various Property, plant and equipment, net consist of the following: December 31, In millions 2018 2017 Machinery and equipment $ 857.2 $ 792.5 Buildings and leasehold equipment 113.1 115.0 Land and land improvements 19.6 18.0 Construction in progress 71.2 35.8 Total cost 1,061.1 961.3 Less: accumulated depreciation (537.3 ) (522.8 ) Property, plant and equipment, net (1) $ 523.8 $ 438.5 _______________ (1) This includes capital leases related to machinery and equipment at our Wickliffe, Kentucky facility of $69.2 million and $70.0 million , and net book value of $6.7 million and $7.6 million at December 31, 2018 and 2017 , respectively. This also includes capital leases related to our Waynesboro, Georgia manufacturing facility for (a) machinery and equipment of $6.5 million and $5.9 million and net book value of $6.0 million and $5.7 million , (b) construction in progress of $13.7 million and $2.1 million and (c) buildings and leasehold improvements of $0.1 million and zero at December 31, 2018 and 2017 , respectively. Amortization expense associated with these capital leases is included within depreciation expense. The payments remaining under these capital leases obligations are included within Note 19. |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The changes in the carrying amount of goodwill by operating segment are as follows: Operating Segments In millions Performance Chemicals Performance Materials Total December 31, 2016 $ 8.1 $ 4.3 $ 12.4 Foreign currency translation — — — December 31, 2017 $ 8.1 $ 4.3 $ 12.4 Foreign currency translation (0.4 ) — (0.4 ) Goodwill acquired (1) 118.7 — 118.7 December 31, 2018 $ 126.4 $ 4.3 $ 130.7 _______________ (1) See Footnote 17 for more information about the Pine Chemicals Acquisition |
Schedule of Finite-Lived Intangible Assets | All of Ingevity's other intangible assets, net are related to the Performance Chemicals operating segment. The following table summarizes intangible assets: December 31, 2018 December 31, 2017 In millions Gross carrying amount Accumulated amortization Net Gross carrying amount Accumulated amortization Net Brands (1) $ 11.4 $ 9.8 $ 1.6 $ 13.9 $ 11.8 $ 2.1 Customer contracts and relationships 151.0 30.3 120.7 28.2 25.4 2.8 Other 4.1 0.8 3.3 — — — Other intangibles, net (2) $ 166.5 $ 40.9 $ 125.6 $ 42.1 $ 37.2 $ 4.9 _______________ (1) Represents trademarks, trade names and know-how. (2) See Footnote 17 for more information about the Pine Chemicals Acquisition and the related increase in Intangible assets. |
Finite-lived Intangible Assets Amortization Expense | The amortization expense related to our intangible assets in the table above for the years ended December 31, 2018 , 2017 and 2016 is shown in the table below. Amortization expense is included within "Cost of sales" and "Selling, general and administrative expenses" on our consolidated statements of operations. Years Ended December 31, In millions 2018 2017 2016 Amortization expense (1) $ 12.3 $ 2.4 $ 2.7 _______________ (1) See Footnote 17 for more information about the Pine Chemicals Acquisition and the related increase in Amortization expense. |
Debt, including Capital Lease_2
Debt, including Capital Lease Obligations (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Current and long-term debt including capital lease obligations consisted of the following: December 31, 2018 December 31, In millions Interest rate Maturity date 2018 2017 Revolving Credit Facility (1) 3.77% 2023 $ — $ — Term Loan Facility 3.77% 2023 375.0 375.0 Senior Notes 4.50% 2026 300.0 — Capital lease obligations 7.67% 2027 80.0 80.0 Other notes payable 5.02% 2018-2019 3.9 — Total debt including capital lease obligations $ 758.9 $ 455.0 Less: debt issuance costs 6.5 1.6 Total debt including capital lease obligations, net of debt issuance costs $ 752.4 $ 453.4 Less: debt maturing within one year (2) 11.2 9.4 Long-term debt including capital lease obligations $ 741.2 $ 444.0 _______________ (1) Letters of credit outstanding under the revolving credit facility were $1.9 million and $1.8 million and available funds under the facility were $748.1 million and $548.2 million at December 31, 2018 and December 31, 2017 , respectively. On February 13, 2019, the revolving credit facility was utilized as the primary source of funds (along with available cash on hand) to close our Caprolactone Acquisition. Our available capacity under our revolving credit facility immediately following this drawdown was $113.1 million . See Note 24 for more information of the Caprolactone Acquisition. (2) Debt maturing within one year is included in "Current maturities of long-term debt" on the consolidated balance sheet. |
Share-based Compensation (Table
Share-based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Allocation of Stock-based Compensation | Our share-based compensation expense recognized post Separation associated with Ingevity's incentive plan and the ESPP is included in the table below. Years Ended December 31, In millions 2018 2017 2016 Stock option expense $ 2.3 $ 1.5 $ 0.7 ESPP expense 0.5 0.2 — RSU, DSU and PSU expense 9.7 8.4 4.0 Total share-based compensation expense (1) 12.5 10.1 4.7 Income tax benefit (2.9 ) (3.8 ) (1.9 ) Total share-based compensation expense, net of tax $ 9.6 $ 6.3 $ 2.8 _______________ (1) Amounts reflected in "Selling, general and administrative expenses" on the Consolidated Statements of Operations. |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques | Expense related to stock options granted from the Separation through December 31, 2018 was based on the assumptions shown in the table below: Years Ended December 31, Weighted-average assumptions used to calculate expense for stock options 2018 2017 2016 Risk-free interest rate 2.7% 2.1% 1.6% Average life of options (years) 6.5 6.5 6.5 Volatility 27.5% 35.0% 35.0% Dividend yield — — — Fair value per stock option $ 25.51 $ 20.71 $ 10.61 |
Disclosure of Stock-based Compensation Arrangements by Stock-based Payment Award | The following table summarizes Ingevity's stock option activity for the period from the Separation through December 31, 2018, as there was no Ingevity stock option activity prior to Separation. Number of Options (in thousands) Weighted-average exercise price (per share) Weighted-average remaining contractual term (years) Aggregate intrinsic value (in thousands) Outstanding, May 16, 2016 — $ — Granted 208 28.03 Exercised — — Forfeited — — Canceled — — Outstanding, December 31, 2016 208 $ 28.03 9.4 $ 5,573 Granted 109 53.11 Exercised (7 ) 27.38 Forfeited (7 ) 31.97 Canceled — — Outstanding, December 31, 2017 303 $ 36.72 8.7 $ 10,022 Granted 110 74.91 Exercised (6 ) 32.37 Forfeited (4 ) 51.66 Canceled — — Outstanding, December 31, 2018 403 $ 46.98 8.1 $ 14,450 Exercisable, December 31, 2018 9 $ 46.14 8.0 $ 352 |
Schedule of Nonvested Share Activity | The following table summarizes Ingevity's RSUs, DSUs and PSUs activity for the period from the Separation through December 31, 2018 , as there was no Ingevity stock option activity prior to Separation. RSUs and DSUs PSUs Number of Units (in thousands) (1) Weighted average grant date fair value (per share) Number of Units (in thousands) (1) Weighted average grant date fair value (per share) Nonvested, May 15, 2016 — $ — — $ — Granted 190 28.08 127 28.06 Vested (23 ) 27.90 — — Forfeited — — — — Nonvested, December 31, 2016 167 $ 28.08 127 $ 28.06 Granted 61 57.21 66 53.11 Vested (75 ) 28.47 — — Forfeited (4 ) 31.00 (9 ) 27.90 Nonvested, December 31, 2017 (2) 149 $ 39.67 184 $ 37.01 Granted 56 77.98 56 74.91 Vested (89 ) 60.94 — — Forfeited (1 ) 61.15 (1 ) 52.18 Nonvested, December 31, 2018 (2) 115 $ 60.94 239 $ 45.88 _______________ (1) The number granted represents the number of shares issuable upon vesting of RSUs and DSUs. For PSUs the number granted represents the number of shares issuable upon vesting assuming that Ingevity performs at the target performance level in each year of the three-year performance period. (2) The nonvested RSU and DSU number of shares at December 31, 2018 , 2017 , and 2016 includes 10 thousand , 8 thousand , and zero DSUs, respectively. |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Summarized below is the roll forward of accumulated other comprehensive income (loss), net of tax. In millions Foreign currency adjustments Derivative Instruments Pension and other postretirement benefits Total Accumulated other comprehensive income (loss), net of tax at December 31, 2015 $ (15.5 ) $ (1.0 ) $ — $ (16.5 ) 2016 Activity Other comprehensive income (loss) before reclassifications (2.9 ) — (0.6 ) (3.5 ) Amounts reclassified from accumulated other comprehensive income (loss) — 1.0 — 1.0 Accumulated other comprehensive income (loss), net of tax at December 31, 2016 $ (18.4 ) $ — $ (0.6 ) $ (19.0 ) 2017 Activity Other comprehensive income (loss) before reclassifications 8.3 (0.1 ) (0.7 ) 7.5 Amounts reclassified from accumulated other comprehensive income (loss) (1) — 0.1 — 0.1 Reclassification of certain deferred tax effects (3) — — (0.3 ) (0.3 ) Accumulated other comprehensive income (loss), net of tax at December 31, 2017 $ (10.1 ) $ — $ (1.6 ) $ (11.7 ) 2018 Activity Other comprehensive income (loss) before reclassifications (6.3 ) 1.3 (0.3 ) (5.3 ) Amounts reclassified from accumulated other comprehensive income (loss) (1) — (0.9 ) 0.2 (0.7 ) Accumulated other comprehensive income (loss), net of tax at December 31, 2018 $ (16.4 ) $ 0.4 $ (1.7 ) $ (17.7 ) _______________ (1) Amounts relate to derivative instruments entered to hedge foreign currency exchange risks on revenue transactions and price risk on natural gas purchases, and therefore were reclassified to "Net sales" and "Cost of sales", respectively. Amounts were reclassified when the hedged items are recognized in the consolidated statements of operations. (2) Amounts reclassified to retained earnings due to early adoption of ASU 2018-02. |
Transactions with WestRock an_2
Transactions with WestRock and related-parties (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | The consolidated statements of operations prior to May 15, 2016, include allocations from WestRock as summarized below: Years Ended December 31, In millions 2018 2017 2016 Cost of sales $ — $ — $ 5.7 Selling, general and administrative expenses — — 6.5 Interest expense, net — — 7.2 Total allocated cost (1) $ — $ — $ 19.4 _______________ (1) Allocated costs represent costs necessary to support Ingevity's operations which include governance and corporate functions such as information technology, accounting, human resources, accounts payable and other direct services including the interest on WestRock debt incurred to provide such services. |
Retirement Plans (Tables)
Retirement Plans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Postemployment Benefits [Abstract] | |
Schedule of Defined Benefit Plans Disclosures | The following table summarizes the weighted average assumptions used and components of our defined benefit postretirement plans. The following tables also reflect a measurement date of December 31: Pensions Other Benefits December 31, In millions, except percentages 2018 2017 2018 2017 Following are the weighted average assumptions used to determine the benefit obligations at December 31: Discount rate - qualified benefit plans 4.20 % 3.55 % — % — % Discount rate - non-qualified benefit plans 4.15 % 3.55 % 4.10 % 3.45 % Rate of compensation increase N/A N/A N/A N/A Change in projected benefit obligation Project benefit obligation at January 1 $ 28.8 $ 24.4 $ 0.8 $ 0.7 Service cost 1.6 1.2 — — Interest cost 1.0 1.0 — — Actuarial loss (gain) (2.0 ) 2.0 (0.1 ) 0.1 Plan amendments 0.5 0.6 — — Benefit payments (0.5 ) (0.4 ) — — Projected benefit obligation at December 31 (1) 29.4 28.8 0.7 0.8 Change in plan assets Fair value of plan asset at January 1 22.6 19.2 — — Actual return on plan assets (1.1 ) 2.4 — — Company contributions 1.6 1.4 — — Benefit payments (0.5 ) (0.4 ) — — Fair value of plan assets at December 31 22.6 22.6 — — Funded Status Net Funded Status of the Plan (Liability) $ (6.8 ) $ (6.2 ) $ (0.7 ) $ (0.8 ) Amount recognized in the consolidated balance sheets: Pension and other postretirement benefit asset (2) $ — $ — $ — $ — Pension and other postretirement benefit (liability) (2) (6.8 ) (6.2 ) (0.7 ) (0.8 ) Total Net Funded Status of the Plan (Liability) $ (6.8 ) $ (6.2 ) $ (0.7 ) $ (0.8 ) _______________ (1) The accumulated benefit obligation for all years presented equals the projected benefit obligation, for each plan respectively. (2) Asset balance is included in "Other assets" and liability balances are included in "Other liabilities" on the consolidated balance sheet. Amounts Recognized in Other Comprehensive Income (Loss) Changes in plan assets and benefit obligations recognized in other comprehensive income (loss) are as follows: Pensions Other Benefits Years Ended December 31, In millions 2018 2017 2016 2018 2017 2016 Current year net actuarial loss (gain) $ — $ 1.1 $ 0.9 $ (0.1 ) $ 0.1 $ (0.1 ) Current year prior service cost (credit) 0.5 — 0.1 — — — Curtailments (0.2 ) — — — — — Total recognized in other comprehensive (income) loss, before taxes 0.3 1.1 1.0 (0.1 ) 0.1 (0.1 ) Total recognized in other comprehensive (income) loss, after taxes $ 0.3 $ 0.7 $ 0.5 $ (0.1 ) $ — $ 0.1 Amounts Recognized in Accumulated Other Comprehensive Income (Loss) The amounts in accumulated other comprehensive income (loss) that have not yet been recognized as components of net periodic benefit cost are as follows: Pensions Other Benefits December 31, In millions 2018 2017 2018 2017 Net actuarial (gain) loss $ 1.3 $ 1.4 $ (0.1 ) $ (0.1 ) Prior service cost (credit) 0.9 0.7 — — Accumulated other comprehensive (income) loss, before taxes 2.2 2.1 (0.1 ) (0.1 ) Accumulated other comprehensive (income) loss, after taxes $ 1.7 $ 1.7 $ (0.1 ) $ (0.1 ) The following table summarizes the weighted-average assumptions used for the components of net annual benefit cost: Pensions Other Benefits Years Ended December 31, In millions, except percentages 2018 2017 2016 2018 2017 2016 Discount rate - qualified benefit plans (1) 3.55 % 4.10 % 4.00 % — % — % — % Discount rate - non-qualified benefit plans (1) 3.55 % 4.15 % 3.75 % 3.45 % 3.95 % 3.75 % Expected return on plan assets 4.00 % 4.50 % 4.50 % N/A N/A N/A Components of net annual benefit cost: Service cost (2) $ 1.6 $ 1.2 $ 0.7 $ — $ — $ — Interest cost (3) 1.0 1.0 0.6 — — — Expected return on plan assets (3) (0.9 ) (0.9 ) (0.6 ) — — — Amortization of prior service cost (3) 0.1 — — — — — Amortization of net actuarial and other (gain) loss (3) — — — — — — Recognized (gain) loss due to curtailments 0.2 — — — — — Net annual benefit cost $ 2.0 $ 1.3 $ 0.7 $ — $ — $ — _______________ (1) The discount rate used to calculate pension and other post-retirement obligations was based on a review of available yields on high-quality corporate bonds. In selecting a discount rate, we placed particular emphasis on a discount rate yield-curve provided by our third-party actuary which takes into consideration the projected cash flows that represent the expected timing and amount of our plans' benefit payments. (2) Amounts are recorded to "Cost of sales" on our consolidated statements of operations consistent with the employee compensation costs that participate in the plan. (3) Amounts are recorded to "Other (income) expense, net" on our consolidated statements of operations. The following table reflects the estimated future benefit payments for our pension and other postretirement benefit plans. These estimates take into consideration expected future service, as appropriate. In millions Pensions Other Benefits 2019 $ 0.5 $ — 2020 0.6 — 2021 0.8 — 2022 1.0 — 2023 1.1 — 2024-2028 $ 7.7 $ 0.2 |
Fair Value, Assets Measured on Recurring Basis | The following table presents our fair value hierarchy for our major categories of pension plan assets by asset class. See Note 6 for the definition of fair value and the descriptions of Level 1, 2 and 3 in the fair value hierarchy. In millions December 31, 2018 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs Cash and short-term investments $ 0.1 $ 0.1 $ — $ — Equity funds and other investments 3.6 3.6 — — Fixed income mutual funds 18.9 1.4 17.5 — Total assets $ 22.6 $ 5.1 $ 17.5 $ — In millions December 31, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs Cash and short-term investments $ 0.5 $ 0.5 $ — $ — Equity funds and other investments 2.7 2.7 — — Fixed income mutual funds 19.4 1.4 18.0 — Total assets $ 22.6 $ 4.6 $ 18.0 $ — |
Business Separation (Tables)
Business Separation (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Other Income and Expenses [Abstract] | |
Business separation | In connection with the Separation as further described in Note 1 and Note 2, we have incurred pre-tax separation costs as shown in the table below. Prior to the Separation, these costs were primarily related to third-party professional fees associated with separation activities and one-time costs of new hires specifically required to separate and stand up Ingevity. Post-Separation, these costs represent legal, information technology and other advisory fees to transition from a division of WestRock to a stand-alone public company. Years Ended December 31, In millions 2018 2017 2016 Separation costs $ — $ 0.9 $ 17.5 |
Restructuring and Other (Inco_2
Restructuring and Other (Income) Charges, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | The following table shows a roll forward of restructuring reserves that will result in cash spending. Balance at Change in Cash Balance at Change in Cash Balance at 12/31/2016 (1) Reserve (2) Payments Other (3) 12/31/2017 (1) Reserve (2) Payments Other (3) 12/31/2018 (1) $ 2.2 3.7 (5.5 ) (0.2 ) $ 0.2 — (0.2 ) — $ — _______________ (1) Included in "Accrued Expenses" on the consolidated balance sheet. (2) Includes severance and other employee-related costs, exited leases, contract terminations and other miscellaneous exit costs. Any asset write-downs including accelerated depreciation and impairment charges are not included in the above table. (3) Primarily non-cash charges and foreign currency translation adjustments. Detail on the restructuring charges and asset disposal activities is provided below. Years Ended December 31, In millions 2018 2017 2016 Restructuring and other (income) charges, net Gain on sale of assets and businesses $ (0.6 ) $ — $ — Severance and other employee-related costs (1) 0.1 1.3 6.3 Asset write-downs (2) — — 30.6 Other (income) charges, net (3) — 2.4 4.3 Total restructuring and other (income) charges, net $ (0.5 ) $ 3.7 $ 41.2 _______________ (1) Represents severance and employee benefit charges. (2) Primarily represents accelerated depreciation and impairment charges on long-lived assets, which were or are to be abandoned. To the extent incurred the acceleration effect of re-estimating settlement dates and revised cost estimates associated with asset retirement obligations due to facility shutdowns are also included within the asset write-downs. (3) Primarily represents costs associated with rental payments, contract terminations, and other miscellaneous exit costs. Other Income primarily represents favorable developments on previously recorded exit costs as recoveries associated with restructuring activities. |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the consideration paid for the Pine Chemicals Acquisition and the amounts of the assets acquired and liabilities assumed as of the Pine Chemicals Acquisition Date. Purchase Price Allocation In millions Weighted Average Amortization Period Fair Value Accounts receivable $ 16.2 Inventories (1) 9.4 Property, plant and equipment 39.3 Intangible assets (2) Patents 12 years 1.9 Non-compete agreement 3 years 2.2 Customer relationships 11 years 129.0 Goodwill (3) 118.7 Other assets 0.1 Total fair value of assets acquired 316.8 Accounts payable 0.8 Accrued expenses 0.5 Total fair value of liabilities assumed $ 1.3 Total cash paid $ 315.5 _______________ (1) Fair value of finished good inventories acquired included a step-up in the value of approximately $1.4 million, of which $1.4 million was expensed in the year ended December 31, 2018. The expense is included in "Cost of sales" on the consolidated statement of operations. (2) The aggregate amortization expense was for the year ended December 31, 2018. Estimated amortization expense is as follows: 2019 - $12.7 million, 2020 - $12.7 million, 2021 - $12.0 million, 2022 - $11.8 million, and 2023 - $11.8 million. (3) Goodwill largely consists of expected cost synergies and economies of scale resulting from the business combination. We expect the full amount to be deductible for income tax purposes. |
Business Acquisition, Pro Forma Information | The pro forma results presented below are adjusted for the removal of Acquisition and other related costs of $6.0 million and $7.1 million for the years ended December 31, 2018 and 2017 , respectively. Years Ended December 31, In millions 2018 2017 Net sales $ 1,153.8 $ 1,073.0 Income (loss) before income taxes 229.3 176.9 Diluted earnings (loss) per share attributable to Ingevity stockholders $ 4.12 $ 3.01 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Domestic and Foreign Components of Income Taxes | Domestic and foreign components of Income (loss) before income taxes are shown below: Years Ended December 31, In millions 2018 2017 2016 Domestic $ 213.3 $ 180.1 $ 118.3 Foreign 8.5 (5.3 ) (31.3 ) Total $ 221.8 $ 174.8 $ 87.0 |
Schedule of Effective Income Tax Rate Reconciliation | The provision (benefit) for income taxes consisted of: Years Ended December 31, In millions 2018 2017 2016 Current Federal $ 32.5 $ 51.6 $ 37.4 State and local 6.0 3.7 5.0 Foreign 0.6 — 2.1 Total current $ 39.1 $ 55.3 $ 44.5 Deferred Federal $ 1.6 $ (25.3 ) $ (2.4 ) State and local (1.1 ) (1.3 ) (0.5 ) Foreign 0.4 0.9 1.0 Total deferred $ 0.9 $ (25.7 ) $ (1.9 ) Provision (benefit) for income taxes $ 40.0 $ 29.6 $ 42.6 The following table summarizes the major differences between taxes computed at the U.S. federal statutory rate and the actual income tax provision attributable to operations: Years Ended December 31, In millions, except percentage data 2018 2017 2016 Federal statutory tax rate $ 46.6 $ 61.2 $ 30.5 State and local income taxes, net of federal benefit 4.4 2.4 2.8 Foreign income tax rate differential 1.0 0.5 0.8 Changes in valuation allowance (2.2 ) 1.7 13.2 Domestic manufacturing deduction — (5.1 ) (4.0 ) Noncontrolling interest in consolidated partnership (2.7 ) (6.6 ) (3.1 ) Nondeductible separation costs — — 1.5 Nondeductible restructuring costs — — 2.2 Federal and state tax credits (2.1 ) (0.7 ) (0.6 ) Deferred rate change (0.1 ) (0.4 ) (0.6 ) U.S. Tax Reform (1.9 ) (24.5 ) — Foreign derived intangible income (3.2 ) — — Other 0.2 1.1 (0.1 ) Provision (benefit) for income taxes $ 40.0 $ 29.6 $ 42.6 Effective tax rate 18.0 % 16.9 % 49.0 % |
Schedule of Deferred Tax Assets and Liabilities | The significant components of deferred tax assets and liabilities are as follows: December 31, In millions 2018 2017 Deferred tax assets: Accrued restructuring $ 7.7 $ 11.4 Employee benefits 14.9 8.0 Intangibles 17.1 3.0 Investment in partnership — 1.8 Net operating losses 8.1 9.0 Start-up costs 0.8 0.8 Inventory — 1.2 Other 7.4 5.0 Total deferred tax assets $ 56.0 $ 40.2 Valuation allowance (15.5 ) (20.4 ) Total deferred tax assets, net of valuation allowance $ 40.5 $ 19.8 Deferred tax liabilities: Fixed assets $ 68.3 $ 57.1 Inventory 4.8 — Other 1.4 0.6 Total deferred tax liabilities $ 74.5 $ 57.7 Net deferred tax asset (liability) $ (34.0 ) $ (37.9 ) |
Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows: December 31, In millions 2018 2017 2016 Balance at beginning of year $ 0.3 $ 0.6 $ 0.7 Additions for tax positions related to current year 0.2 — — Additions for tax positions related to prior years — 0.1 0.1 Reductions for tax positions related to prior years — — (0.2 ) Reduction from lapse of statute of limitation (0.2 ) (0.4 ) — Balance at end of year $ 0.3 $ 0.3 $ 0.6 |
Commitment and Contingencies (T
Commitment and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Operating Lease | Minimum rental payments pursuant to agreements as of December 31, 2018 , under operating leases that have non-cancelable lease terms in excess of 12 months and under capital leases are as follows: In millions Operating leases (1) Capital leases (1) 2019 $ 21.9 $ 6.1 2020 17.2 6.1 2021 13.3 6.1 2022 9.7 6.1 2023 6.0 6.1 Later years 5.9 101.5 Minimum lease payments $ 74.0 $ 132.0 Less: amount representing interest 52.0 Capital lease obligations $ 80.0 |
Schedule of Capital Lease | Minimum rental payments pursuant to agreements as of December 31, 2018 , under operating leases that have non-cancelable lease terms in excess of 12 months and under capital leases are as follows: In millions Operating leases (1) Capital leases (1) 2019 $ 21.9 $ 6.1 2020 17.2 6.1 2021 13.3 6.1 2022 9.7 6.1 2023 6.0 6.1 Later years 5.9 101.5 Minimum lease payments $ 74.0 $ 132.0 Less: amount representing interest 52.0 Capital lease obligations $ 80.0 _______________ (1) Capital and operating lease obligations are presented in accordance with ASC 840. Effective January 1, 2019, we will adopt ASC 842. See Note 4 for information on the adoption and the impact to our Consolidated Financial Statements. |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | Years Ended December 31, In millions 2018 2017 2016 Net sales Performance Materials $ 400.4 $ 349.3 $ 301.0 Performance Chemicals 733.2 623.1 607.3 Total net sales (1) 1,133.6 972.4 908.3 Segment operating profit (2) Performance Materials 147.2 122.0 106.9 Performance Chemicals 116.3 80.3 56.7 Total segment operating profit (1) 263.5 202.3 163.6 Separation costs (3) — (0.9 ) (17.5 ) Restructuring and other income (charges), net (4) 0.5 (3.7 ) (41.2 ) Acquisition and other related costs (5) (12.2 ) (7.1 ) — Pension and postretirement settlement and curtailment income (charges) (6) (0.2 ) — — Interest expense (33.2 ) (18.1 ) (19.3 ) Interest income 3.4 2.3 1.4 (Provision) benefit for income taxes (40.0 ) (29.6 ) (42.6 ) Net (income) loss attributable to noncontrolling interests (12.7 ) (18.7 ) (9.2 ) Net income (loss) attributable to Ingevity stockholders $ 169.1 $ 126.5 $ 35.2 _______________ (1) Relates to external customers only, all intersegment sales and related profit have been eliminated in consolidation. (2) Segment operating profit is defined as segment revenue less segment operating expenses (segment operating expenses consist of costs of sales, selling, general and administrative expenses and other (income) expense, net). We have excluded the following items from segment operating profit: interest expense, net associated with corporate debt facilities, income taxes, gains (or losses) on divestitures of businesses, restructuring and other (income) charges, separation costs, acquisition costs, pension and postretirement settlement and curtailment income (charges), and net income (loss) attributable to noncontrolling interest. (3) See Note 15 for more information on separation costs. (4) Information about how restructuring and other (income) charges relate to our businesses at the segment level is discussed in Note 16. (5) These charges are associated with the acquisition and integration of the Pine Chemical Business and the acquisition of the Caprolactone Business. See below for more detail on the charges incurred and Note 17 within these Consolidated Financial Statements for more information. Years Ended December 31, In millions 2018 2017 2016 Legal and professional service fees (1) $ 6.9 $ 7.1 $ — Inventory fair value step-up amortization (2) 1.4 — — Purchase price hedge adjustment (1) 3.9 — — Acquisition and other related costs $ 12.2 $ 7.1 $ — _______________ (1) Included within "Acquisition and other related costs" on the consolidated statement of operations. (2) Included within "Cost of sales" on the consolidated statement of operations. Total assets December 31, In millions 2018 2017 Performance Materials $ 547.8 $ 438.9 Performance Chemicals 755.7 479.8 Total segment assets (1) $ 1,303.5 $ 918.7 Corporate and other 11.7 10.9 Total assets $ 1,315.2 $ 929.6 _______________ (1) Segment assets exclude assets not specifically managed as part of one specific segment herein referred to as "Corporate and other." Net sales to external customers for each of our product line is presented below. Years Ended December 31, In millions 2018 2017 2016 Performance Materials Net sales Automotive Technologies product line $ 362.0 $ 312.5 $ 263.5 Process Purification product line 38.4 36.8 37.5 Total Performance Materials Net sales (1) $ 400.4 $ 349.3 $ 301.0 _______________ (1) Sales are assigned to geographic areas based on location to which product was shipped to a third-party. Relates to external customers only, all intersegment sales and related profit have been eliminated in consolidation. Years Ended December 31, In millions 2018 2017 2016 Performance Chemicals Net sales Pavement Technologies product line $ 178.5 $ 163.0 $ 148.8 Oilfield Technologies product line 114.2 77.8 58.5 Industrial Specialties product line 440.5 382.3 400.0 Total Performance Chemicals Net sales (1) $ 733.2 $ 623.1 $ 607.3 _______________ (1) Sales are assigned to geographic areas based on location to which product was shipped to a third-party. Relates to external customers only, all intersegment sales and related profit have been eliminated in consolidation. Depreciation and amortization Capital expenditures Years Ended December 31, Years Ended December 31, In millions 2018 2017 2016 2018 2017 2016 Performance Materials $ 22.2 $ 19.8 $ 16.4 $ 65.4 $ 36.9 $ 39.6 Performance Chemicals 34.8 20.6 22.4 28.5 15.7 17.1 Total $ 57.0 $ 40.4 $ 38.8 $ 93.9 $ 52.6 $ 56.7 |
Business Acquisition, Integration, Restructuring and Other Related Costs | Years Ended December 31, In millions 2018 2017 2016 Legal and professional service fees (1) $ 6.9 $ 7.1 $ — Inventory fair value step-up amortization (2) 1.4 — — Purchase price hedge adjustment (1) 3.9 — — Acquisition and other related costs $ 12.2 $ 7.1 $ — _______________ (1) Included within "Acquisition and other related costs" on the consolidated statement of operations. (2) Included within "Cost of sales" on the consolidated statement of operations. |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas | Property, plant, and equipment, net December 31, In millions 2018 2017 North America $ 444.4 $ 358.4 Asia Pacific 78.7 79.3 Europe, Middle East and Africa 0.6 0.7 South America 0.1 0.1 Property, plant, and equipment, net $ 523.8 $ 438.5 Total assets December 31, In millions 2018 2017 Performance Materials $ 547.8 $ 438.9 Performance Chemicals 755.7 479.8 Total segment assets (1) $ 1,303.5 $ 918.7 Corporate and other 11.7 10.9 Total assets $ 1,315.2 $ 929.6 _______________ (1) Segment assets exclude assets not specifically managed as part of one specific segment herein referred to as "Corporate and other." |
Earnings (Loss) per Share (Tabl
Earnings (Loss) per Share (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | Years Ended December 31, In millions (except share and per share data) 2018 2017 2016 Net income (loss) attributable to Ingevity stockholders $ 169.1 $ 126.5 $ 35.2 Basic and Diluted earnings (loss) per share (1) Basic earnings (loss) per share $ 4.02 $ 3.00 $ 0.83 Diluted earnings (loss) per share $ 3.97 $ 2.97 $ 0.83 Shares (2) Weighted average number of shares of common stock outstanding - Basic 42,037 42,130 42,108 Weighted average additional shares assuming conversion of potential common shares 564 399 163 Shares - diluted basis 42,601 42,529 42,271 _______________ (1) Diluted earnings (loss) per share is calculated using net income (loss) available to common stockholders divided by diluted weighted-average shares of common shares outstanding during each period, which includes the dilutive effect of outstanding equity awards. Basic and diluted earnings (loss) per share for the year ended December 31, 2016 is calculated using the weighted average number of common shares outstanding for the period beginning after the Distribution Date. (2) Shares are presented in thousands. |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following average number of potential common shares were antidilutive and, therefore, were not included in the diluted earnings per share calculation: Years Ended December 31, In thousands 2018 2017 2016 Average number of potential common shares - antidilutive 84 79 4 |
Supplemental Information (Table
Supplemental Information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Prepaid and Other Current Assets | The following tables include details of prepaid and other current assets, other assets, accrued expenses and other liabilities as presented on the consolidated balance sheets, as well as other (income) expense, net on the consolidated statement of operations: Prepaid and other current assets: December 31, In millions 2018 2017 Income and value added tax receivables $ 15.0 $ 8.2 Prepaid freight and supply agreements 1.1 0.8 Prepaid insurance 1.7 1.3 Non-trade receivables 3.4 2.4 Advances to suppliers 1.5 0.8 Equity securities, foreign currency, commodity hedging (Note 6) 0.7 1.8 Contract asset (Note 5) 5.1 — Other 6.4 5.5 $ 34.9 $ 20.8 |
Other Noncurrent Assets | Other assets: December 31, In millions 2018 2017 Deferred financing charges $ 3.1 $ 2.7 Capitalized software, net (Note 3) 9.5 12.5 Land-use rights 5.6 6.0 Planned major maintenance activities (Note 3) 3.2 2.1 Deferred compensation plan assets 4.4 — Other 12.5 7.1 $ 38.3 $ 30.4 |
Accrued Liabilities | Accrued expenses: December 31, In millions 2018 2017 Accrued interest $ 8.5 $ 3.1 Accrued taxes 3.0 1.7 Accrued freight 5.1 1.9 Accrued rebates 6.4 4.9 Restructuring reserves (Note 16) — 0.2 Separation-related reimbursement awards (Notes 6) 0.1 0.9 Accrued royalties and commissions 1.8 1.7 Foreign currency hedging (Note 6) 3.9 — Other 7.9 5.6 $ 36.7 $ 20.0 |
Other Noncurrent Liabilities | Other liabilities: December 31, In millions 2018 2017 Deferred compensation arrangements (Note 6) $ 4.6 $ 2.0 Pension & OPEB liabilities (Note 14) 7.5 7.0 Unrecognized tax benefits (Note 18) 0.3 0.3 Other 2.7 3.9 $ 15.1 $ 13.2 |
Schedule of Other Nonoperating (Income) Expense | Other (income) expense, net: Years Ended December 31, In millions 2018 2017 2016 Foreign currency translation (gain)/loss $ 2.0 $ 1.2 $ (2.9 ) Royalty (income)/expense (0.8 ) (0.7 ) (1.0 ) Other (gain)/loss (0.2 ) — 0.7 $ 1.0 $ 0.5 $ (3.2 ) |
Quarterly Financial Informati_2
Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information (Unaudited) | The following is a summary of the quarterly results of operations for the years ended December 31, 2018 , and 2017 . 2018 2017 In millions, except earnings per share amounts 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Net sales $ 235.2 $ 308.6 $ 311.2 $ 278.6 $ 218.5 $ 260.3 $ 264.1 $ 229.5 Gross profit 85.1 115.5 118.6 97.6 70.7 89.8 93.2 75.3 Income (loss) before taxes 45.5 64.6 68.1 43.6 34.0 53.0 55.1 32.7 Net income (loss) 35.8 52.2 51.7 42.1 23.0 35.8 38.4 48.0 Less: Net income (loss) attributable to noncontrolling interests 5.0 5.5 2.2 — 4.0 3.7 4.6 6.4 Net income (loss) attributable to Ingevity stockholders $ 30.8 $ 46.7 $ 49.5 $ 42.1 $ 19.0 $ 32.1 $ 33.8 $ 41.6 Basic earnings (loss) per common share attributable to Ingevity stockholders $ 0.73 $ 1.11 $ 1.18 $ 1.01 $ 0.45 $ 0.76 $ 0.80 $ 0.98 Diluted earnings (loss) per common share attributable to Ingevity stockholders (1) $ 0.72 $ 1.10 $ 1.16 $ 0.99 $ 0.45 $ 0.76 $ 0.79 $ 0.97 Weighted average shares outstanding Basic 42.1 42.1 42.0 41.9 42.1 42.1 42.1 42.1 Diluted 42.6 42.6 42.7 42.5 42.4 42.4 42.5 42.6 _______________ (1) Basic and diluted earnings (loss) per share are calculated using the weighted average number of common shares outstanding for the period. The sum of quarterly earnings per common share may differ from the full-year amount. |
Background - Narrative (Details
Background - Narrative (Details) | 12 Months Ended | ||
Dec. 31, 2018segment$ / shares | Dec. 31, 2017$ / shares | May 15, 2016$ / shares | |
Business Combination, Consideration Transferred | |||
Number of reportable segments | segment | 2 | ||
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 | $ 0.01 |
WestRock, Rock-Tenn and MWV | |||
Business Combination, Consideration Transferred | |||
Common stock, par value (usd per share) | $ 0.01 |
Basis of Consolidation and Pr_2
Basis of Consolidation and Presentation Basis of Consolidation and Presentation - Narrative (Details) - PurCell | Dec. 31, 2018 | Aug. 01, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | May 15, 2016 |
Noncontrolling Interest [Line Items] | |||||
Noncontrolling interest ownership percentage | 30.00% | 30.00% | 30.00% | 30.00% | |
Additional interest acquisition | 30.00% |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Accounts Receivable and Allowance for Doubtful Accounts (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Accounting Policies [Abstract] | ||
Allowance for doubtful accounts receivable | $ 0.4 | $ 0.4 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Concentration Risk (Details) - Customer Concentration Risk - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Accounts Receivable | |||
Concentration Risk [Line Items] | |||
Concentration risk exposure | $ 7.1 | $ 16.4 | |
Sales | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 5.00% | 8.00% | 9.00% |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Inventory (Details) | Dec. 31, 2018 |
Accounting Policies [Abstract] | |
Percentage of FIFO inventory | 28.00% |
Percentage of weighted average cost inventory | 9.00% |
Percentage of LIFO inventory | 63.00% |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Useful Life of PPE and Intangible Assets (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Minimum | |
Property, Plant and Equipment | |
Finite lived intangible assets useful life | 5 years |
Maximum | |
Property, Plant and Equipment | |
Finite lived intangible assets useful life | 20 years |
Buildings and leasehold equipment | Minimum | |
Property, Plant and Equipment | |
PPE useful life | 20 years |
Buildings and leasehold equipment | Maximum | |
Property, Plant and Equipment | |
PPE useful life | 40 years |
Machinery and equipment | Minimum | |
Property, Plant and Equipment | |
PPE useful life | 5 years |
Machinery and equipment | Maximum | |
Property, Plant and Equipment | |
PPE useful life | 30 years |
Capitalized software | Minimum | |
Property, Plant and Equipment | |
PPE useful life | 1 year |
Capitalized software | Maximum | |
Property, Plant and Equipment | |
PPE useful life | 10 years |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Types of Assets (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Production Vessels and Kilns, Storage Tanks, Piping | |
Property, Plant and Equipment | |
PPE useful life | 20 years |
Control systems, Instrumentation, Metering Equipment | |
Property, Plant and Equipment | |
PPE useful life | 15 years |
Blending Equipment, Storage Tanks, Piping, Shipping Equipment and Platforms, Safety Equipment | Minimum | |
Property, Plant and Equipment | |
PPE useful life | 25 years |
Blending Equipment, Storage Tanks, Piping, Shipping Equipment and Platforms, Safety Equipment | Maximum | |
Property, Plant and Equipment | |
PPE useful life | 30 years |
Production Control System Equipment and Hardware, Laboratory Testing Equipment | Minimum | |
Property, Plant and Equipment | |
PPE useful life | 5 years |
Production Control System Equipment and Hardware, Laboratory Testing Equipment | Maximum | |
Property, Plant and Equipment | |
PPE useful life | 10 years |
Machinery & equipment support structures and foundations | |
Property, Plant and Equipment | |
PPE useful life | 40 years |
Various | |
Property, Plant and Equipment | |
Percentage of machinery and equipment | 4.00% |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Noncontrolling interests (Details) - PurCell | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | May 15, 2016 |
Related Party Transaction [Line Items] | ||||
Noncontrolling interest ownership percentage | 30.00% | 30.00% | 30.00% | 30.00% |
Percentage of earnings included in calculation of provision for income taxes | 70.00% |
New Accounting Guidance - Narra
New Accounting Guidance - Narrative (Details) - USD ($) $ in Millions | Jan. 01, 2019 | Jan. 01, 2018 | Dec. 31, 2017 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Adoption of accounting standard | $ 1.6 | ||
Accumulated other comprehensive income (loss) | ASU 2018-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Adoption of accounting standard | $ (3) | ||
Minimum | ASU 2016-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Lease asset | $ 60 | ||
Maximum | ASU 2016-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Lease asset | $ 70 |
New Accounting Guidance - Cumul
New Accounting Guidance - Cumulative effect of the changes (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Assets | |||
Accounts receivable, net of allowance | $ 118.9 | $ 100.3 | $ 100 |
Inventories, net | 191.4 | 157.6 | 160 |
Prepaid and other current assets | 34.9 | 25.9 | 20.8 |
Liabilities | |||
Accrued expenses | 36.7 | 20.9 | 20 |
Deferred income taxes | 36.9 | 41.8 | |
Equity | |||
Retained earnings | 313.5 | 144.4 | 142.8 |
Calculated under Revenue Guidance in Effect before Topic 606 | |||
Assets | |||
Accounts receivable, net of allowance | 118.5 | 100 | |
Inventories, net | 193.6 | 160 | |
Prepaid and other current assets | 29.2 | 20.8 | |
Liabilities | |||
Accrued expenses | 35.7 | 20 | |
Deferred income taxes | 36.7 | 41.3 | |
Equity | |||
Retained earnings | 310.8 | $ 142.8 | |
Accounting Standards Update 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 | |||
Assets | |||
Accounts receivable, net of allowance | 0.4 | 0.3 | |
Inventories, net | (2.2) | (2.4) | |
Prepaid and other current assets | 5.7 | 5.1 | |
Liabilities | |||
Accrued expenses | 1 | 0.9 | |
Deferred income taxes | 0.2 | 0.5 | |
Equity | |||
Retained earnings | $ 2.7 | $ 1.6 |
New Accounting Guidance - Conde
New Accounting Guidance - Condensed consolidated statement of operations (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||
Net sales | $ 278.6 | $ 311.2 | $ 308.6 | $ 235.2 | $ 229.5 | $ 264.1 | $ 260.3 | $ 218.5 | $ 1,133.6 | $ 972.4 | $ 908.3 |
Cost of sales | 716.8 | 643.4 | 633.9 | ||||||||
Provision (benefit) for income taxes | 40 | 29.6 | 42.6 | ||||||||
Net Income (Loss) Attributable to Parent | $ 42.1 | $ 49.5 | $ 46.7 | $ 30.8 | $ 41.6 | $ 33.8 | $ 32.1 | $ 19 | 169.1 | $ 126.5 | $ 35.2 |
Balances without Adoption of ASC 606 | |||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||
Net sales | 1,133 | ||||||||||
Cost of sales | 717.1 | ||||||||||
Provision (benefit) for income taxes | 39.8 | ||||||||||
Net Income (Loss) Attributable to Parent | 168.4 | ||||||||||
Effect of Change Higher/(Lower) | Accounting Standards Update 2014-09 | |||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||
Net sales | 0.6 | ||||||||||
Cost of sales | (0.3) | ||||||||||
Provision (benefit) for income taxes | 0.2 | ||||||||||
Net Income (Loss) Attributable to Parent | $ 0.7 |
New Accounting Guidance - Con_2
New Accounting Guidance - Condensed consolidated balance sheet (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Assets | |||
Accounts receivable, net of allowance | $ 118.9 | $ 100.3 | $ 100 |
Inventories, net | 191.4 | 157.6 | 160 |
Prepaid and other current assets | 34.9 | 25.9 | 20.8 |
Liabilities | |||
Accrued expenses | 36.7 | 20.9 | 20 |
Deferred income taxes | 36.9 | 41.8 | |
Equity | |||
Retained earnings | 313.5 | 144.4 | 142.8 |
Calculated under Revenue Guidance in Effect before Topic 606 | |||
Assets | |||
Accounts receivable, net of allowance | 118.5 | 100 | |
Inventories, net | 193.6 | 160 | |
Prepaid and other current assets | 29.2 | 20.8 | |
Liabilities | |||
Accrued expenses | 35.7 | 20 | |
Deferred income taxes | 36.7 | 41.3 | |
Equity | |||
Retained earnings | 310.8 | $ 142.8 | |
Difference between Revenue Guidance in Effect before and after Topic 606 | Accounting Standards Update 2014-09 | |||
Assets | |||
Accounts receivable, net of allowance | 0.4 | 0.3 | |
Inventories, net | (2.2) | (2.4) | |
Prepaid and other current assets | 5.7 | 5.1 | |
Liabilities | |||
Accrued expenses | 1 | 0.9 | |
Deferred income taxes | 0.2 | 0.5 | |
Equity | |||
Retained earnings | $ 2.7 | $ 1.6 |
Revenues - Revenue by segment (
Revenues - Revenue by segment (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 278.6 | $ 311.2 | $ 308.6 | $ 235.2 | $ 229.5 | $ 264.1 | $ 260.3 | $ 218.5 | $ 1,133.6 | $ 972.4 | $ 908.3 |
Performance Materials | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 400.4 | 349.3 | 301 | ||||||||
Performance Materials | Automotive Technologies product line | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 362 | 312.5 | 263.5 | ||||||||
Performance Materials | Process Purification product line | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 38.4 | 36.8 | 37.5 | ||||||||
Performance Chemicals | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 733.2 | 623.1 | 607.3 | ||||||||
Performance Chemicals | Oilfield Technologies product line | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 114.2 | 77.8 | 58.5 | ||||||||
Performance Chemicals | Pavement Technologies product line | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 163 | 148.8 | |||||||||
Performance Chemicals | Industrial Specialties product line | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 440.5 | $ 382.3 | $ 400 |
Revenues - Revenue disaggregsat
Revenues - Revenue disaggregsated by geographic area (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 278.6 | $ 311.2 | $ 308.6 | $ 235.2 | $ 229.5 | $ 264.1 | $ 260.3 | $ 218.5 | $ 1,133.6 | $ 972.4 | $ 908.3 |
North America | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 770.4 | 662.9 | 597.8 | ||||||||
Asia Pacific | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 171.4 | 142.5 | 138.8 | ||||||||
Europe, Middle East and Africa | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 169.9 | 149.2 | 151.1 | ||||||||
South America | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 21.9 | $ 17.8 | $ 20.6 |
Revenues - Contract assets (Det
Revenues - Contract assets (Details) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Contract with customer, liability | $ 0 |
Change in Contract with Customer, Asset [Roll Forward] | |
Balance at January 1, 2018 | 4,400,000 |
Contract asset additions | 26,600,000 |
Reclassification to accounts receivable, billed to customers | 25,900,000 |
Balance at December 31, 2018 | $ 5,100,000 |
Financial Instruments, Risk M_3
Financial Instruments, Risk Management, and Fair Value Measurements - Narrative (Details) mmbtus in Millions | 12 Months Ended | ||
Dec. 31, 2018USD ($)mmbtus | Dec. 31, 2017USD ($) | May 16, 2016USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Equity investments | $ 700,000 | $ 1,800,000 | |
Realized gain (loss) | 0 | 0 | |
Unrealized gain (loss) | (300,000) | 300,000 | |
Equity securities where fair value is not readily determinable | 1,500,000 | 3,000,000 | |
Impairment on equity security | 1,500,000 | ||
Equity securities | 3,000,000 | ||
Significant transfers | 0 | ||
Debt, Long-term and Short-term, Combined Amount | 758,900,000 | 455,000,000 | |
Restricted investment | 71,200,000 | 71,300,000 | |
Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Equity investments | 400,000 | 1,800,000 | |
Level 2 | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Equity investments | 0 | 0 | |
Level 1 | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Equity investments | 400,000 | 1,800,000 | |
Restricted investment | 71,200,000 | 71,300,000 | |
Restricted investments, fair value | 66,700,000 | 69,600,000 | $ 68,900,000 |
Reported Value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Capital lease obligations | 80,000,000 | 80,000,000 | |
Estimate of Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Capital lease obligations | 90,400,000 | 92,900,000 | |
Foreign Exchange Contract | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative, notional amount | 1,900,000 | ||
Fair value of derivative | 200,000 | 0 | |
Foreign Exchange Contract | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of derivative | 200,000 | ||
Commodity Contract | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of derivative | 0 | 0 | |
Variable Interest Rate | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Carrying amount of long-term debt | 366,200,000 | $ 365,600,000 | |
Senior Notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Debt instrument, fair value disclosure | $ 275,200,000 | ||
Commodity swap contracts | Commodity Contract | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Notional volume (in mmBTUS) | mmbtus | 1.8 | ||
Zero Cost Collar | Commodity Contract | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Notional volume (in mmBTUS) | mmbtus | 1.4 |
Financial Instruments, Risk M_4
Financial Instruments, Risk Management, and Fair Value Measurements - Summary of Assets and Liabilities Fair Value Measured on a Recurring Basis (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Assets: | |||
Equity investments | $ 0.7 | $ 1.8 | |
Liabilities: | |||
Stock award expense | 0.1 | 0.3 | $ 1.6 |
Fair Value, Measurements, Recurring | |||
Assets: | |||
Equity investments | 0.4 | 1.8 | |
Deferred compensation plan investments | 1.3 | ||
Total assets | 2 | 1.8 | |
Liabilities: | |||
Deferred compensation arrangement | 4.6 | 2 | |
Separation Related Reimbursement Awards | 0.1 | 0.9 | |
Total liabilities | 8.7 | 2.9 | |
Fair Value, Measurements, Recurring | Foreign currency hedging | |||
Assets: | |||
Derivative Asset | 0.2 | ||
Liabilities: | |||
Derivative liabilities | 3.9 | ||
Fair Value, Measurements, Recurring | Commodity hedging | |||
Assets: | |||
Derivative Asset | 0.1 | ||
Liabilities: | |||
Derivative liabilities | 0.1 | ||
Fair Value, Measurements, Recurring | Level 1 | |||
Assets: | |||
Equity investments | 0.4 | 1.8 | |
Deferred compensation plan investments | 1.3 | ||
Total assets | 1.7 | 1.8 | |
Liabilities: | |||
Deferred compensation arrangement | 4.6 | 2 | |
Separation Related Reimbursement Awards | 0.1 | 0.9 | |
Total liabilities | 4.7 | 2.9 | |
Fair Value, Measurements, Recurring | Level 1 | Foreign currency hedging | |||
Assets: | |||
Derivative Asset | 0 | ||
Liabilities: | |||
Derivative liabilities | 0 | ||
Fair Value, Measurements, Recurring | Level 1 | Commodity hedging | |||
Assets: | |||
Derivative Asset | 0 | ||
Liabilities: | |||
Derivative liabilities | 0 | ||
Fair Value, Measurements, Recurring | Level 2 | |||
Assets: | |||
Equity investments | 0 | 0 | |
Deferred compensation plan investments | 0 | ||
Total assets | 0.3 | 0 | |
Liabilities: | |||
Deferred compensation arrangement | 0 | 0 | |
Separation Related Reimbursement Awards | 0 | 0 | |
Total liabilities | 4 | 0 | |
Fair Value, Measurements, Recurring | Level 2 | Foreign currency hedging | |||
Assets: | |||
Derivative Asset | 0.2 | ||
Liabilities: | |||
Derivative liabilities | 3.9 | ||
Fair Value, Measurements, Recurring | Level 2 | Commodity hedging | |||
Assets: | |||
Derivative Asset | 0.1 | ||
Liabilities: | |||
Derivative liabilities | 0.1 | ||
Fair Value, Measurements, Recurring | Level 3 | |||
Assets: | |||
Equity investments | 0 | 0 | |
Deferred compensation plan investments | 0 | ||
Total assets | 0 | 0 | |
Liabilities: | |||
Deferred compensation arrangement | 0 | 0 | |
Separation Related Reimbursement Awards | 0 | 0 | |
Total liabilities | 0 | $ 0 | |
Fair Value, Measurements, Recurring | Level 3 | Foreign currency hedging | |||
Assets: | |||
Derivative Asset | 0 | ||
Liabilities: | |||
Derivative liabilities | 0 | ||
Fair Value, Measurements, Recurring | Level 3 | Commodity hedging | |||
Assets: | |||
Derivative Asset | 0 | ||
Liabilities: | |||
Derivative liabilities | 0 | ||
Perstorp UK Ltd | |||
Liabilities: | |||
Stock award expense | $ 3.9 |
Inventories, net (Details)
Inventories, net (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jan. 01, 2018 | |
Inventory, Net | ||||
Raw materials | $ 36,500,000 | $ 40,100,000 | ||
Production materials, stores and supplies | 17,500,000 | 13,400,000 | ||
Finished and in-process goods | 144,700,000 | 114,300,000 | ||
Subtotal | 198,700,000 | 167,800,000 | ||
Less: excess of cost over LIFO cost | (7,300,000) | (7,800,000) | ||
Inventories, net | $ 191,400,000 | $ 160,000,000 | $ 157,600,000 | |
Percentage of LIFO inventory | 63.00% | 66.00% | ||
Decrease of Cost of Sales | $ 0 | $ 0 | $ 3,600,000 |
Property, Plant and Equipment_3
Property, Plant and Equipment, net (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment | ||
Total cost | $ 1,061,100,000 | $ 961,300,000 |
Less: accumulated depreciation | (537,300,000) | (522,800,000) |
Property, plant and equipment, net | 523,800,000 | 438,500,000 |
Machinery and equipment | ||
Property, Plant and Equipment | ||
Total cost | 857,200,000 | 792,500,000 |
Buildings and leasehold equipment | ||
Property, Plant and Equipment | ||
Total cost | 113,100,000 | 115,000,000 |
Land and land improvements | ||
Property, Plant and Equipment | ||
Total cost | 19,600,000 | 18,000,000 |
Construction in progress | ||
Property, Plant and Equipment | ||
Total cost | 71,200,000 | 35,800,000 |
Wickliffe, Kentucky Manufacturing Facility | Machinery and equipment | ||
Property, Plant and Equipment | ||
Property, plant and equipment, net | 6,700,000 | 7,600,000 |
Capital leases | 69,200,000 | 70,000,000 |
Waynesboro, Georgia Manufacturing Facility | Machinery and equipment | ||
Property, Plant and Equipment | ||
Property, plant and equipment, net | 6,000,000 | 5,700,000 |
Capital leases | 6,500,000 | 5,900,000 |
Waynesboro, Georgia Manufacturing Facility | Buildings and leasehold equipment | ||
Property, Plant and Equipment | ||
Property, plant and equipment, net | 100,000 | 0 |
Waynesboro, Georgia Manufacturing Facility | Construction in progress | ||
Property, Plant and Equipment | ||
Property, plant and equipment, net | $ 13,700,000 | $ 2,100,000 |
Property, Plant and Equipment_4
Property, Plant and Equipment, net - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation | $ 41.9 | $ 35.5 | $ 33.2 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets, net - Carrying Amount (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Goodwill | ||
Goodwill, beginning balance | $ 12.4 | $ 12.4 |
Foreign currency translation | (0.4) | 0 |
Goodwill acquired | 118.7 | |
Goodwill, ending balance | 130.7 | 12.4 |
Performance Chemicals | ||
Goodwill | ||
Goodwill, beginning balance | 8.1 | 8.1 |
Foreign currency translation | (0.4) | 0 |
Goodwill acquired | 118.7 | |
Goodwill, ending balance | 126.4 | 8.1 |
Performance Materials | ||
Goodwill | ||
Goodwill, beginning balance | 4.3 | 4.3 |
Foreign currency translation | 0 | 0 |
Goodwill acquired | 0 | |
Goodwill, ending balance | $ 4.3 | $ 4.3 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets, net - Narrative (Details) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill, impairment loss | $ 0 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets, net - Intangible Assets (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Finite-Lived Intangible Assets, Net | ||
Net | $ 125.6 | $ 4.9 |
Brands | Performance Chemicals | ||
Finite-Lived Intangible Assets, Net | ||
Gross carrying amount | 11.4 | 13.9 |
Accumulated amortization | 9.8 | 11.8 |
Net | 1.6 | 2.1 |
Customer contracts and relationships | Performance Chemicals | ||
Finite-Lived Intangible Assets, Net | ||
Gross carrying amount | 151 | 28.2 |
Accumulated amortization | 30.3 | 25.4 |
Net | 120.7 | 2.8 |
Other | Performance Chemicals | ||
Finite-Lived Intangible Assets, Net | ||
Gross carrying amount | 4.1 | 0 |
Accumulated amortization | 0.8 | 0 |
Net | 3.3 | 0 |
Other intangibles, net (2) | Performance Chemicals | ||
Finite-Lived Intangible Assets, Net | ||
Gross carrying amount | 166.5 | 42.1 |
Accumulated amortization | 40.9 | 37.2 |
Net | $ 125.6 | $ 4.9 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets, net - Amortization (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense | $ 12.3 | $ 2.4 | $ 2.7 |
Goodwill and Other Intangible_7
Goodwill and Other Intangible Assets, net - Maturity (Details) $ in Millions | Dec. 31, 2018USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity | |
2,019 | $ 14.3 |
2,020 | 13.2 |
2,021 | 12.3 |
2,022 | 12.2 |
2,023 | $ 12.2 |
Debt, including Capital Lease_3
Debt, including Capital Lease Obligations - Narrative (Details) | Aug. 07, 2018USD ($) | Jan. 24, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | May 16, 2016USD ($) |
Line of Credit Facility | ||||||
Deferred finance cost | $ 7,100,000 | $ 1,300,000 | $ 3,600,000 | |||
Leverage ratio | 4 | |||||
Potential leverage ratio | 4.50 | |||||
Interest ratio | 3 | |||||
Level 1 | Fair Value, Measurements, Recurring | ||||||
Line of Credit Facility | ||||||
Restricted investments, fair value | $ 66,700,000 | 69,600,000 | $ 68,900,000 | |||
Credit Agreement - Amendment | ||||||
Line of Credit Facility | ||||||
Line of credit facility increase | $ 200,000,000 | |||||
Maximum borrowing capacity | $ 750,000,000 | |||||
Commitment fee | 5.00% | |||||
Line of credit facility fees | $ 1,400,000 | |||||
Line of credit facility amortization rate | 125.00% | |||||
Credit Agreement - Amendment | Minimum | ||||||
Line of Credit Facility | ||||||
Unused capacity fee (percentage) | 15.00% | |||||
Credit Agreement - Amendment | Minimum | LIBOR | ||||||
Line of Credit Facility | ||||||
Debt instrument, basis spread on variable rate | 100.00% | |||||
Credit Agreement - Amendment | Minimum | Base Rate | ||||||
Line of Credit Facility | ||||||
Debt instrument, basis spread on variable rate | 0.00% | |||||
Credit Agreement - Amendment | Maximum | ||||||
Line of Credit Facility | ||||||
Unused capacity fee (percentage) | 30.00% | |||||
Credit Agreement - Amendment | Maximum | LIBOR | ||||||
Line of Credit Facility | ||||||
Debt instrument, basis spread on variable rate | 175.00% | |||||
Credit Agreement - Amendment | Maximum | Base Rate | ||||||
Line of Credit Facility | ||||||
Debt instrument, basis spread on variable rate | 75.00% | |||||
Senior Notes | Senior Notes | ||||||
Line of Credit Facility | ||||||
Debt instrument, face amount | $ 300,000,000 | |||||
Note interest rate | 4.50% | |||||
Deferred finance cost | $ 5,700,000 | |||||
Net proceeds from Notes, net | $ 294,300,000 | |||||
Reported Value | ||||||
Line of Credit Facility | ||||||
Capital lease obligations | $ 80,000,000 | $ 80,000,000 |
Debt, including Capital Lease_4
Debt, including Capital Lease Obligations - Schedule of Long-term Debt Including Capital Lease Obligations (Details) - USD ($) $ in Millions | Feb. 13, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Line of Credit Facility | |||
Current and Long-term debt including capital lease obligations | $ 758.9 | $ 455 | |
Less: debt issuance costs | 6.5 | 1.6 | |
Total debt including capital lease obligations, net of debt issuance costs | 752.4 | 453.4 | |
Less: debt maturing within one year | 11.2 | 9.4 | |
Long-term debt including capital lease obligations | $ 741.2 | 444 | |
Revolving Credit Facility | |||
Line of Credit Facility | |||
Interest rate | 3.77% | ||
Current and Long-term debt including capital lease obligations | $ 0 | 0 | |
Letters of credit outstanding, amount | 1.9 | 1.8 | |
Letter of credit remaining amount | $ 748.1 | 548.2 | |
Term Loan Facility | |||
Line of Credit Facility | |||
Interest rate | 3.77% | ||
Current and Long-term debt including capital lease obligations | $ 375 | 375 | |
Senior Notes | |||
Line of Credit Facility | |||
Interest rate | 4.50% | ||
Current and Long-term debt including capital lease obligations | $ 300 | 0 | |
Capital lease obligations | |||
Line of Credit Facility | |||
Interest rate | 7.67% | ||
Current and Long-term debt including capital lease obligations | $ 80 | 80 | |
Other notes payable | |||
Line of Credit Facility | |||
Interest rate | 5.02% | ||
Current and Long-term debt including capital lease obligations | $ 3.9 | $ 0 | |
Subsequent Event | |||
Line of Credit Facility | |||
Letter of credit remaining amount | $ 113.1 |
Share-based Compensation - Narr
Share-based Compensation - Narrative (Details) - USD ($) | 8 Months Ended | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Share-based compensation | $ 12,500,000 | $ 10,100,000 | $ 4,700,000 | |
Maximum number of shares per employees | 5,000 | |||
Average price of shares purchased (dollars per share) | $ 0 | $ 32.37 | $ 27.38 | |
RSU, DSU, PSU | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Share-based compensation | $ 9,700,000 | $ 8,400,000 | 4,000,000 | |
Unrecognized stock based compensation | $ 22,000,000 | 12,600,000 | ||
Unrecognized stock based compensation expense, recognition period (years) | 1 year | |||
ESPP | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Share-based compensation | $ 500,000 | 200,000 | 0 | |
Maximum shares reserve for equity awards | 250,000 | |||
Shares available for grant | 206,255 | |||
Discount on common stock (as a percentage) | 15.00% | |||
Purchase price of common stock (as a percentage) | 85.00% | |||
Shares purchased under the ESPP | 31,862 | |||
Average price of shares purchased (dollars per share) | $ 57.81 | |||
Stock Option | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Share-based compensation | $ 2,300,000 | 1,500,000 | 700,000 | |
Expiration period (in years) | 10 years | |||
Unrecognized stock based compensation | $ 4,600,000 | |||
Unrecognized stock based compensation expense, recognition period (years) | 1 year | |||
Stock Option | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Vesting period on stock options (years) | 1 year | |||
Stock Option | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Vesting period on stock options (years) | 3 years | |||
RSUs and DSUs | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Vesting period on stock options (years) | 1 year | |||
RSUs and DSUs | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Vesting period on stock options (years) | 3 years | |||
Performance Shares (PSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Vesting period on stock options (years) | 3 years | |||
WestRock Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Share-based compensation | $ 0 | $ 0 | $ 500,000 | |
2016 Omnibus Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Maximum shares reserve for equity awards | 4,000,000 | |||
Shares available for grant | 3,258,944 |
Share-based Compensation - Allo
Share-based Compensation - Allocated Share-based Compensation (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation | $ 12.5 | $ 10.1 | $ 4.7 |
Income tax benefit | (2.9) | (3.8) | (1.9) |
Total share-based compensation expense, net of tax | 9.6 | 6.3 | 2.8 |
Stock Option | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation | 2.3 | 1.5 | 0.7 |
ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation | 0.5 | 0.2 | 0 |
RSU, DSU, PSU | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation | $ 9.7 | $ 8.4 | $ 4 |
Share-based Compensation - Assu
Share-based Compensation - Assumptions (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology | |||
Risk-free interest rate | 2.70% | 2.10% | 1.60% |
Average life of options (years) | 6 years 6 months | 6 years 6 months | 6 years 6 months |
Volatility | 27.50% | 35.00% | 35.00% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Fair value per stock option (per share) | $ 25.51 | $ 20.71 | $ 10.61 |
Share-based Compensation - Opti
Share-based Compensation - Options Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 8 Months Ended | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | May 15, 2016 | |
Number of Options (in thousands) | ||||
Outstanding beginning balance (shares) | 0 | 303,000 | 208,000 | |
Granted (shares) | 208,000 | 110,000 | 109,000 | |
Exercised (shares) | 0 | (6,000) | (7,000) | |
Forfeited (shares) | 0 | (4,000) | (7,000) | |
Canceled (shares) | 0 | 0 | 0 | |
Outstanding ending balance (shares) | 208,000 | 403,000 | 303,000 | |
Stock options exercisable (shares) | 9,000 | |||
Weighted-average exercise price (per share) | ||||
Weighted average exercise price (per share) granted | $ 28.03 | $ 74.91 | $ 53.11 | |
Exercised (dollars per share) | 0 | 32.37 | 27.38 | |
Forfeited (dollars per share) | 0 | 51.66 | 31.97 | |
Canceled (dollars per share) | 0 | 0 | 0 | |
Weighted average exercise price (per share) outstanding | $ 28.03 | 46.98 | $ 36.72 | $ 0 |
Weighted average exercise price (per share) exercisable | $ 46.14 | |||
Weighted-average remaining contractual term (years) | 9 years 5 months | 8 years 1 month | 8 years 8 months | |
Exercisable, weighted-average remaining contractual term (years) | 8 years | |||
Aggregate intrinsic value | $ 5,573 | $ 14,450 | $ 10,022 | |
Stock options exercisable, aggregate intrinsic value | $ 352 |
Share-based Compensation - RSU,
Share-based Compensation - RSU, DSU, and PSU Activity (Details) - $ / shares | 8 Months Ended | 12 Months Ended | |||||
Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | May 15, 2016 | |
RSUs and DSUs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | |||||||
Nonvested beginning balance (shares) | 167,000 | 115,000 | 149,000 | 115,000 | 149,000 | 167,000 | 0 |
Granted (shares) | 190,000 | 56,000 | 61,000 | ||||
Vested (shares) | (23,000) | (89,000) | (75,000) | ||||
Forfeited (shares) | 0 | (1,000) | (4,000) | ||||
Nonvested ending balance (shares) | 167,000 | 115,000 | 149,000 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value | |||||||
Weighted average grant date fair value (per share), beginning balance | $ 39.67 | $ 28.08 | |||||
Weighted average grant date fair value (per share) granted | $ 28.08 | 77.98 | 57.21 | ||||
Weighted average grant date fair value (per share) vested | 27.90 | 60.94 | 28.47 | ||||
Weighted average grant date fair value (per share) forfeited | $ 0 | 61.15 | 31 | ||||
Weighted average grant date fair value (per share), ending balance | $ 39.67 | $ 28.08 | $ 60.94 | $ 39.67 | $ 28.08 | $ 0 | |
Performance Shares (PSUs) | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | |||||||
Nonvested beginning balance (shares) | 127,000 | 239,000 | 184,000 | 239,000 | 184,000 | 127,000 | 0 |
Granted (shares) | 127,000 | 56,000 | 66,000 | ||||
Vested (shares) | 0 | 0 | 0 | ||||
Forfeited (shares) | 0 | (1,000) | (9,000) | ||||
Nonvested ending balance (shares) | 127,000 | 239,000 | 184,000 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value | |||||||
Weighted average grant date fair value (per share), beginning balance | $ 37.01 | $ 28.06 | |||||
Weighted average grant date fair value (per share) granted | $ 28.06 | 74.91 | 53.11 | ||||
Weighted average grant date fair value (per share) vested | 0 | 0 | 0 | ||||
Weighted average grant date fair value (per share) forfeited | $ 0 | 52.18 | 27.90 | ||||
Weighted average grant date fair value (per share), ending balance | $ 37.01 | $ 28.06 | $ 45.88 | $ 37.01 | $ 28.06 | $ 0 | |
Deferred Stock Units (DSUs) | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | |||||||
Nonvested beginning balance (shares) | 0 | 10,000 | 8,000 | 10,000 | 8,000 | 0 | |
Nonvested ending balance (shares) | 0 | 10,000 | 8,000 |
Equity - Rollforward of Accumla
Equity - Rollforward of Accumlated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Beginning balance, value | $ 277.9 | $ 134.6 | $ 517.4 |
Other comprehensive income (loss) before reclassifications | (6) | 7.6 | (2.5) |
Ending balance, value | 338.7 | 277.9 | 134.6 |
Accumulated other comprehensive income (loss) | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Beginning balance, value | (11.7) | (19) | (16.5) |
Other comprehensive income (loss) before reclassifications | (5.3) | 7.5 | (3.5) |
Amounts reclassified from accumulated other comprehensive income (loss) | (0.7) | 0.1 | 1 |
Reclassification of certain deferred tax effects | (0.3) | ||
Ending balance, value | (17.7) | (11.7) | (19) |
Foreign currency adjustments | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Beginning balance, value | (10.1) | (18.4) | (15.5) |
Other comprehensive income (loss) before reclassifications | (6.3) | 8.3 | (2.9) |
Ending balance, value | (16.4) | (10.1) | (18.4) |
Derivative Instruments | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Beginning balance, value | 0 | 0 | (1) |
Other comprehensive income (loss) before reclassifications | 1.3 | (0.1) | |
Amounts reclassified from accumulated other comprehensive income (loss) | (0.9) | 0.1 | 1 |
Ending balance, value | 0.4 | 0 | 0 |
Pension and other postretirement benefits | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Beginning balance, value | (1.6) | (0.6) | 0 |
Other comprehensive income (loss) before reclassifications | (0.3) | (0.7) | (0.6) |
Amounts reclassified from accumulated other comprehensive income (loss) | 0.2 | ||
Reclassification of certain deferred tax effects | (0.3) | ||
Ending balance, value | $ (1.7) | $ (1.6) | $ (0.6) |
Equity - Noncontrolling Interes
Equity - Noncontrolling Interest Acquisition (Details) - USD ($) $ in Millions | Aug. 01, 2018 | Dec. 31, 2018 |
Business Acquisition [Line Items] | ||
Acquisition of Noncontrolling interest | $ 65.7 | |
Purification Cellutions LLC | ||
Business Acquisition [Line Items] | ||
Additional interest acquisition | 30.00% | |
Purification Cellutions LLC | ||
Business Acquisition [Line Items] | ||
Purchase price | $ 80 | |
Deferred tax asset decrease | $ 14.3 | |
Purification Cellutions LLC | Purification Cellutions LLC | ||
Business Acquisition [Line Items] | ||
Additional interest acquisition | 30.00% | |
Noncontrolling interests | ||
Business Acquisition [Line Items] | ||
Acquisition of Noncontrolling interest | 11.4 | |
Noncontrolling interests | Purification Cellutions LLC | ||
Business Acquisition [Line Items] | ||
Acquisition of Noncontrolling interest | $ 11.4 | |
Additional paid-in capital | ||
Business Acquisition [Line Items] | ||
Acquisition of Noncontrolling interest | $ 54.3 | |
Additional paid-in capital | Purification Cellutions LLC | ||
Business Acquisition [Line Items] | ||
Acquisition of Noncontrolling interest | $ 54.3 |
Equity - Share Repurchases (Det
Equity - Share Repurchases (Details) - USD ($) $ / shares in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Nov. 01, 2018 | Feb. 20, 2017 | |
Equity [Abstract] | ||||
Shares authorized for repurchase | 350,000,000 | 100,000,000 | ||
Shares repurchased during period | $ 47.4 | $ 6.6 | ||
Shares repurchased during period (in shares) | 561,000 | |||
Weighted average cost per share (in dollars per share) | $ 0 | |||
Authorized amount remaining for repurchase | $ 396 |
Transactions with WestRock an_3
Transactions with WestRock and related-parties - Summary of Allocated Cost (Details) - Affiliated Entity - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Operating Income (Loss) | |||
Total allocated cost | $ 0 | $ 0 | $ 19.4 |
Cost of sales | |||
Operating Income (Loss) | |||
Total allocated cost | 0 | 0 | 5.7 |
Selling, general and administrative expenses | |||
Operating Income (Loss) | |||
Total allocated cost | 0 | 0 | 6.5 |
Interest expense, net | |||
Operating Income (Loss) | |||
Total allocated cost | $ 0 | $ 0 | $ 7.2 |
Transactions with WestRock an_4
Transactions with WestRock and related-parties - Narrative (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018USD ($)mill | Dec. 31, 2016USD ($) | Dec. 31, 2017USD ($) | |
Related Party Transaction | |||
Number of largest kraft mills | mill | 2 | ||
Accounts payable | $ 92.9 | $ 83.1 | |
WestRock | Minimum | |||
Related Party Transaction | |||
Percentage of long-term supply of CTO | 30.00% | ||
WestRock | Maximum | |||
Related Party Transaction | |||
Percentage of long-term supply of CTO | 40.00% | ||
WestRock | Purchase of Raw Material | |||
Related Party Transaction | |||
Purchases from related party | $ 20.1 | ||
WestRock | Mill A | Minimum | |||
Related Party Transaction | |||
Percentage of long-term supply of CTO | 19.00% | ||
WestRock | Mill A | Maximum | |||
Related Party Transaction | |||
Percentage of long-term supply of CTO | 20.00% | ||
WestRock | Mill B | Minimum | |||
Related Party Transaction | |||
Percentage of long-term supply of CTO | 17.00% | ||
WestRock | Mill B | Maximum | |||
Related Party Transaction | |||
Percentage of long-term supply of CTO | 18.00% |
Retirement Plans - Narrative (D
Retirement Plans - Narrative (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2019 | |
Defined Contribution Plan Disclosure [Line Items] | ||||
Employer contributions | $ 10,200,000 | $ 9,300,000 | $ 3,200,000 | |
Company contributions | 1,500,000 | $ 1,200,000 | ||
Impact of .5% increase on post retirement benefit obligation | (2,000,000) | |||
Impact of .5% increase on post retirement cost | (100,000) | |||
Impact of .5% decrease on post retirement benefit obligation | 2,300,000 | |||
Impact of .5% decrease on post retirement cost | 300,000 | |||
Impact of .5% increase on assumed long-term rate of return on plan assets | (100,000) | |||
Impact of .5% decrease on assumed long-term rate of return on plan assets | $ 100,000 | |||
Nonqualified Plan | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Employee matching contribution, percent of employee deferral | 6.00% | |||
Employer matching contribution, percent of match | 3.00% | |||
Scenario One | Qualified Plan | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Employer matching contribution, percent of match | 100.00% | |||
Employer matching contribution, percent of employees' gross pay | 3.00% | |||
Scenario Two | Qualified Plan | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Employer matching contribution, percent of match | 50.00% | |||
Employer matching contribution, percent of employees' gross pay | 2.00% | |||
WestRock cash balance | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Employer transition contribution, percentage of employee's gross pay | 4.00% | |||
Final average pay pension | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Employer transition contribution, percentage of employee's gross pay | 10.00% | |||
Scenario, Forecast | Subsequent Event | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Estimated net actuarial gain to be amortized | $ 0 | |||
Estimated prior service cost to be amortized (less than) | $ 100,000 | |||
WestRock | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Employer contributions | $ 7,700,000 |
Retirement Plans - Components o
Retirement Plans - Components of Defined Benefit Pension and Post-retirement Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Change in plan assets | |||
Company contributions | $ 1.5 | $ 1.2 | |
Pensions | |||
Change in projected benefit obligation | |||
Beginning balance, value | 28.8 | 24.4 | |
Service cost | 1.6 | 1.2 | $ 0.7 |
Interest cost | 1 | 1 | 0.6 |
Actuarial loss (gain) | (2) | 2 | |
Plan amendments | 0.5 | 0.6 | |
Benefit payments | (0.5) | (0.4) | |
Ending balance, value | 29.4 | 28.8 | 24.4 |
Change in plan assets | |||
Beginning balance, fair value of plan asset | 22.6 | 19.2 | |
Actual return on plan assets | (1.1) | 2.4 | |
Company contributions | 1.6 | 1.4 | |
Benefit payments | (0.5) | (0.4) | |
Ending balance, fair value of plan asset | 22.6 | 22.6 | 19.2 |
Net Funded Status of the Plan (Liability) | (6.8) | (6.2) | |
Pension and other postretirement benefit asset | 0 | 0 | |
Pension and other postretirement benefit (liability) | (6.8) | (6.2) | |
Other Benefits | |||
Change in projected benefit obligation | |||
Beginning balance, value | 0.8 | 0.7 | |
Service cost | 0 | 0 | 0 |
Interest cost | 0 | 0 | 0 |
Actuarial loss (gain) | (0.1) | 0.1 | |
Plan amendments | 0 | 0 | |
Benefit payments | 0 | 0 | |
Ending balance, value | 0.7 | 0.8 | $ 0.7 |
Change in plan assets | |||
Beginning balance, fair value of plan asset | 0 | ||
Actual return on plan assets | 0 | 0 | |
Company contributions | 0 | 0 | |
Benefit payments | 0 | 0 | |
Ending balance, fair value of plan asset | 0 | 0 | |
Net Funded Status of the Plan (Liability) | (0.7) | (0.8) | |
Pension and other postretirement benefit asset | 0 | 0 | |
Pension and other postretirement benefit (liability) | $ (0.7) | $ (0.8) | |
Qualified Plan | Pensions | |||
Defined Benefit Plan Disclosure | |||
Discount rate - qualified benefit plans | 4.20% | 3.55% | |
Qualified Plan | Other Benefits | |||
Defined Benefit Plan Disclosure | |||
Discount rate - qualified benefit plans | 0.00% | 0.00% | |
Nonqualified Plan | Pensions | |||
Defined Benefit Plan Disclosure | |||
Discount rate - qualified benefit plans | 4.15% | 3.55% | |
Nonqualified Plan | Other Benefits | |||
Defined Benefit Plan Disclosure | |||
Discount rate - qualified benefit plans | 4.10% | 3.45% |
Retirement Plans - Amounts Reco
Retirement Plans - Amounts Recognized in Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Pensions | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Current year net actuarial loss (gain) | $ 0 | $ 1.1 | $ 0.9 |
Current year prior service cost (credit) | 0.5 | 0 | 0.1 |
Curtailments | (0.2) | 0 | 0 |
Total recognized in other comprehensive (income) loss, before taxes | 0.3 | 1.1 | 1 |
Total recognized in other comprehensive (income) loss, after taxes | 0.3 | 0.7 | 0.5 |
Other Benefits | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Current year net actuarial loss (gain) | (0.1) | 0.1 | (0.1) |
Current year prior service cost (credit) | 0 | 0 | 0 |
Curtailments | 0 | 0 | 0 |
Total recognized in other comprehensive (income) loss, before taxes | (0.1) | 0.1 | (0.1) |
Total recognized in other comprehensive (income) loss, after taxes | $ (0.1) | $ 0 | $ 0.1 |
Retirement Plans - Amounts Re_2
Retirement Plans - Amounts Recognized in Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Pensions | ||
Defined Benefit Plan, Amounts Recognized in Other Comprehensive Income (Loss) | ||
Net actuarial (gain) loss | $ 1.3 | $ 1.4 |
Prior service cost (credit) | 0.9 | 0.7 |
Accumulated other comprehensive (income) loss, before taxes | 2.2 | 2.1 |
Accumulated other comprehensive (income) loss, after taxes | 1.7 | 1.7 |
Other Benefits | ||
Defined Benefit Plan, Amounts Recognized in Other Comprehensive Income (Loss) | ||
Net actuarial (gain) loss | (0.1) | (0.1) |
Prior service cost (credit) | 0 | 0 |
Accumulated other comprehensive (income) loss, before taxes | (0.1) | (0.1) |
Accumulated other comprehensive (income) loss, after taxes | $ (0.1) | $ (0.1) |
Retirement Plans - Net Annual B
Retirement Plans - Net Annual Benefit Costs Assumptions (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Pensions | |||
Components of net annual benefit cost: | |||
Expected return on plan assets (percentage) | 4.00% | 4.50% | 4.50% |
Service cost | $ 1.6 | $ 1.2 | $ 0.7 |
Interest cost | 1 | 1 | 0.6 |
Expected return on plan assets | (0.9) | (0.9) | (0.6) |
Amortization of prior service cost | 0.1 | 0 | 0 |
Amortization of net actuarial and other (gain) loss | 0 | 0 | 0 |
Recognized (gain) loss due to curtailments | 0.2 | 0 | 0 |
Net annual benefit cost | 2 | 1.3 | 0.7 |
Other Benefits | |||
Components of net annual benefit cost: | |||
Service cost | 0 | 0 | 0 |
Interest cost | 0 | 0 | 0 |
Expected return on plan assets | 0 | 0 | 0 |
Amortization of prior service cost | 0 | 0 | 0 |
Amortization of net actuarial and other (gain) loss | 0 | 0 | 0 |
Recognized (gain) loss due to curtailments | 0 | 0 | 0 |
Net annual benefit cost | $ 0 | $ 0 | $ 0 |
Qualified Plan | Pensions | |||
Components of net annual benefit cost: | |||
Discount rate - qualified benefit plans | 3.55% | 4.10% | 4.00% |
Qualified Plan | Other Benefits | |||
Components of net annual benefit cost: | |||
Discount rate - qualified benefit plans | 0.00% | 0.00% | 0.00% |
Nonqualified Plan | Pensions | |||
Components of net annual benefit cost: | |||
Discount rate - qualified benefit plans | 3.55% | 4.15% | 3.75% |
Nonqualified Plan | Other Benefits | |||
Components of net annual benefit cost: | |||
Discount rate - qualified benefit plans | 3.45% | 3.95% | 3.75% |
Retirement Plans - Fair Value o
Retirement Plans - Fair Value of Pension Assets (Details) - Pensions - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | $ 22.6 | $ 22.6 | $ 19.2 |
Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | 22.6 | 22.6 | |
Fair Value, Measurements, Recurring | Cash and short-term investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | 0.1 | 0.5 | |
Fair Value, Measurements, Recurring | Equity funds and other investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | 3.6 | 2.7 | |
Fair Value, Measurements, Recurring | Fixed income mutual funds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | 18.9 | 19.4 | |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | 5.1 | 4.6 | |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Cash and short-term investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | 0.1 | 0.5 | |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Equity funds and other investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | 3.6 | 2.7 | |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed income mutual funds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | 1.4 | 1.4 | |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | 17.5 | 18 | |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Fixed income mutual funds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | 17.5 | 18 | |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Pension and other postretirement benefit asset | $ 0 | $ 0 |
Retirement Plans - Estimated Fu
Retirement Plans - Estimated Future Benefit Payments (Details) $ in Millions | Dec. 31, 2018USD ($) |
Pensions | |
Defined Benefit Plan Disclosure | |
2,019 | $ 0.5 |
2,020 | 0.6 |
2,021 | 0.8 |
2,022 | 1 |
2,023 | 1.1 |
2024-2028 | 7.7 |
Other Benefits | |
Defined Benefit Plan Disclosure | |
2,019 | 0 |
2,020 | 0 |
2,021 | 0 |
2,022 | 0 |
2,023 | 0 |
2024-2028 | $ 0.2 |
Business Separation (Details)
Business Separation (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Other Income and Expenses [Abstract] | |||
Separation costs | $ 0 | $ 0.9 | $ 17.5 |
Restructuring and Other (Inco_3
Restructuring and Other (Income) Charges, net - Narrative (Details) - USD ($) $ in Millions | Oct. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations | ||||
Gain on sale of asset | $ 0.6 | $ 0 | $ 0 | |
Other expenses | 0.1 | |||
Severance costs | 0.1 | 1.3 | 6.3 | |
Other restructuring cost | $ 0 | $ 2.4 | 4.3 | |
Performance Chemicals | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations | ||||
Asset impairment | 0.3 | |||
Employee related severance cost | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations | ||||
Severance costs | 2.7 | |||
Employee related severance cost | Performance Chemicals | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations | ||||
Severance costs | 1.9 | |||
Employee related severance cost | Performance Materials | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations | ||||
Severance costs | 0.8 | |||
Palmeira, Santa Catarina, Brazil, Performance Chemicals | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations | ||||
Severance costs | $ 1.8 | |||
Other restructuring cost | 2.6 | |||
Asset impairment | $ 30.2 | |||
Duque De Caxias, Rio de Janeiro, Brazil, Performance Chemicals | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations | ||||
Severance costs | 1.8 | |||
Other restructuring cost | 1.7 | |||
Asset impairment | $ 0.1 |
Restructuring and Other (Inco_4
Restructuring and Other (Income) Charges, net - Restructuring (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Restructuring and other (income) charges, net | |||
Gain on sale of assets and businesses | $ (0.6) | $ 0 | $ 0 |
Severance and other employee-related costs | 0.1 | 1.3 | 6.3 |
Asset write-down | 0 | 0 | 30.6 |
Other (income) charges, net | 0 | 2.4 | 4.3 |
Total restructuring and other (income) charges, net | $ (0.5) | $ 3.7 | $ 41.2 |
Restructuring and Other (Inco_5
Restructuring and Other (Income) Charges, net - Restructuring Reserve (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Restructuring Reserve | ||
Restructuring reserve, beginning balance | $ 0.2 | $ 2.2 |
Change in reserve | 0 | 3.7 |
Cash payments | (0.2) | (5.5) |
Other | 0 | (0.2) |
Restructuring reserve, ending balance | $ 0 | $ 0.2 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) | Mar. 08, 2018 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jan. 24, 2018 |
Business Acquisition [Line Items] | ||||||
Acquisition-related costs | $ 10,800,000 | $ 7,100,000 | $ 0 | |||
Purchase price hedge adjustment | 3,900,000 | 0 | 0 | |||
Georgia-Pacific Chemicals LLC | ||||||
Business Acquisition [Line Items] | ||||||
Purchase price | $ 315,500,000 | $ 315,500,000 | ||||
Weighted average amortization period | 20 years | |||||
Acquisition-related costs | 10,800,000 | 7,100,000 | $ 0 | |||
Caprolactone Acquisition | ||||||
Business Acquisition [Line Items] | ||||||
Acquisition-related costs | 6,000,000 | $ 7,100,000 | ||||
Purchase price hedge adjustment | $ 3,900,000 | |||||
Senior Notes | ||||||
Business Acquisition [Line Items] | ||||||
Debt instrument, face amount | $ 300,000,000 |
Acquisitions - Assets Acquired
Acquisitions - Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions | Mar. 08, 2018 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 130.7 | $ 12.4 | $ 12.4 | ||
2,019 | 14.3 | ||||
2,020 | 13.2 | ||||
2,021 | 12.3 | ||||
2,022 | 12.2 | ||||
2,023 | 12.2 | ||||
Georgia-Pacific Chemicals LLC | |||||
Business Acquisition [Line Items] | |||||
Weighted Average Amortization Period | 20 years | ||||
Accounts receivable | $ 16.2 | ||||
Inventories | 9.4 | ||||
Property, plant and equipment | 39.3 | ||||
Goodwill | 118.7 | ||||
Other assets | 0.1 | ||||
Total fair value of assets acquired | 316.8 | ||||
Accounts payable | 0.8 | ||||
Accrued expenses | 0.5 | ||||
Total fair value of liabilities assumed | 1.3 | ||||
Total cash paid | $ 315.5 | $ 315.5 | |||
Inventory step up | 1.4 | ||||
Inventory expense | 1.4 | ||||
2,019 | 12.7 | ||||
2,020 | 12.7 | ||||
2,021 | 12 | ||||
2,022 | 11.8 | ||||
2,023 | $ 11.8 | ||||
Patents | Georgia-Pacific Chemicals LLC | |||||
Business Acquisition [Line Items] | |||||
Weighted Average Amortization Period | 12 years | ||||
Intangible assets | $ 1.9 | ||||
Non-compete agreement | Georgia-Pacific Chemicals LLC | |||||
Business Acquisition [Line Items] | |||||
Weighted Average Amortization Period | 3 years | ||||
Intangible assets | $ 2.2 | ||||
Customer relationships | Georgia-Pacific Chemicals LLC | |||||
Business Acquisition [Line Items] | |||||
Weighted Average Amortization Period | 11 years | ||||
Intangible assets | $ 129 |
Acquisitions - Pro Forma (Detai
Acquisitions - Pro Forma (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Business Combinations [Abstract] | ||
Net sales | $ 1,153.8 | $ 1,073 |
Income (loss) before income taxes | $ 229.3 | $ 176.9 |
Diluted earnings (loss) per share attributable to Ingevity stockholders (usd per share) | $ 4.12 | $ 3.01 |
Income Taxes - Domestic and For
Income Taxes - Domestic and Foreign Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Contingency | |||||||||||
Income before income taxes | $ 43.6 | $ 68.1 | $ 64.6 | $ 45.5 | $ 32.7 | $ 55.1 | $ 53 | $ 34 | $ 221.8 | $ 174.8 | $ 87 |
Domestic | |||||||||||
Income Tax Contingency | |||||||||||
Income before income taxes | 213.3 | 180.1 | 118.3 | ||||||||
Foreign | |||||||||||
Income Tax Contingency | |||||||||||
Income before income taxes | $ 8.5 | $ (5.3) | $ (31.3) |
Income Taxes - Provision for In
Income Taxes - Provision for Income Tax (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Current | |||
Federal | $ 32.5 | $ 51.6 | $ 37.4 |
State and local | 6 | 3.7 | 5 |
Foreign | 0.6 | 0 | 2.1 |
Total current | 39.1 | 55.3 | 44.5 |
Deferred | |||
Federal | 1.6 | (25.3) | (2.4) |
State and local | (1.1) | (1.3) | (0.5) |
Foreign | 0.4 | 0.9 | 1 |
Total deferred | 0.9 | (25.7) | (1.9) |
Provision (benefit) for income taxes | $ 40 | $ 29.6 | $ 42.6 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2019 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Operating Loss Carryforwards [Line Items] | |||||
Deferred tax provision recognized in OCI | $ 0.4 | $ 0.1 | $ 0.4 | ||
Deferred tax benefit recognized in OCI | $ (0.3) | ||||
Effective tax rate | 18.00% | 16.90% | 49.00% | ||
U.S. Tax Reform | $ (24.5) | $ (1.9) | $ (24.5) | $ 0 | |
Change in enacted tax rate, percent | 14.00% | ||||
Net operation loss, foreign | $ 22.5 | ||||
Net operation loss foreign expected to expire | 3.5 | ||||
Net operation loss foreign with no expiration date | 19 | ||||
Cash and cash equivalents held by foreign subsidiaries | 27 | ||||
Positive undistributed earnings to be reinvested (less than) | 1 | ||||
Unrecognized tax benefits, penalties and interest | 0.3 | 0.5 | 1 | ||
Reduction from lapse of statute of limitation | $ 0.2 | $ 0.4 | $ 0 | ||
Minimum | |||||
Operating Loss Carryforwards [Line Items] | |||||
Foreign net operation loss carryforwards, expiration period (in years) | 3 years | ||||
Maximum | |||||
Operating Loss Carryforwards [Line Items] | |||||
Foreign net operation loss carryforwards, expiration period (in years) | 10 years | ||||
Scenario, Forecast | Subsequent Event | |||||
Operating Loss Carryforwards [Line Items] | |||||
Reduction from lapse of statute of limitation | $ 0.2 |
Income Taxes - Effective Inccom
Income Taxes - Effective Inccome Tax Reconciliation (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Effective Income Tax Rate Reconciliation, Amount | ||||
Federal statutory tax rate | $ 46.6 | $ 61.2 | $ 30.5 | |
State and local income taxes, net of federal benefit | 4.4 | 2.4 | 2.8 | |
Foreign income tax rate differential | 1 | 0.5 | 0.8 | |
Changes in valuation allowance | (2.2) | 1.7 | 13.2 | |
Domestic manufacturing deduction | 0 | (5.1) | (4) | |
Noncontrolling interest in consolidated partnership | (2.7) | (6.6) | (3.1) | |
Nondeductible separation costs | 0 | 0 | 1.5 | |
Nondeductible restructuring costs | 0 | 0 | 2.2 | |
Federal and state tax credits | (2.1) | (0.7) | (0.6) | |
Deferred rate change | (0.1) | (0.4) | (0.6) | |
U.S. Tax Reform | $ (24.5) | (1.9) | (24.5) | 0 |
Foreign derived intangible income | (3.2) | 0 | 0 | |
Other | 0.2 | 1.1 | (0.1) | |
Provision (benefit) for income taxes | $ 40 | $ 29.6 | $ 42.6 | |
Effective tax rate | 18.00% | 16.90% | 49.00% |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets: | ||
Accrued restructuring | $ 7.7 | $ 11.4 |
Employee benefits | 14.9 | 8 |
Intangibles | 17.1 | 3 |
Investment in partnership | 0 | 1.8 |
Net operating losses | 8.1 | 9 |
Start-up costs | 0.8 | 0.8 |
Inventory | 0 | 1.2 |
Other | 7.4 | 5 |
Total deferred tax assets | 56 | 40.2 |
Valuation allowance | (15.5) | (20.4) |
Total deferred tax assets, net of valuation allowance | 40.5 | 19.8 |
Deferred tax liabilities: | ||
Fixed assets | 68.3 | 57.1 |
Other | (4.8) | 0 |
Other | (1.4) | (0.6) |
Total deferred tax liabilities | 74.5 | 57.7 |
Net deferred tax asset (liability) | $ (34) | $ (37.9) |
Income Taxes - Rollfoward of Un
Income Taxes - Rollfoward of Unrecognized Income Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns | ||||
Balance at beginning of year | $ 0.3 | $ 0.6 | $ 0.7 | |
Additions for tax positions related to current year | 0.2 | 0 | 0 | |
Additions for tax positions related to prior years | 0 | 0.1 | 0.1 | |
Reductions for tax positions related to prior years | 0 | 0 | (0.2) | |
Reduction from lapse of statute of limitation | (0.2) | (0.4) | 0 | |
Balance at end of year | $ 0.3 | $ 0.6 | $ 0.7 | $ 0.3 |
Commitment and Contingencies -
Commitment and Contingencies - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Operating Leased Assets [Line Items] | |||
Capital lease obligations | $ 80 | $ 80 | |
Operating rental expense | $ 18.4 | $ 16.8 | $ 17.4 |
Capital lease obligations | |||
Operating Leased Assets [Line Items] | |||
Capital lease obligation imputed interest rate | 7.67% |
Commitment and Contingencies _2
Commitment and Contingencies - Future Minimum Payments (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Operating leases (1) | ||
2,019 | $ 21.9 | |
2,020 | 17.2 | |
2,021 | 13.3 | |
2,022 | 9.7 | |
2,023 | 6 | |
Later years | 5.9 | |
Minimum lease payments | 74 | |
Capital leases (1) | ||
2,019 | 6.1 | |
2,020 | 6.1 | |
2,021 | 6.1 | |
2,022 | 6.1 | |
2,023 | 6.1 | |
Later years | 101.5 | |
Minimum lease payments | 132 | |
Less: amount representing interest | 52 | |
Capital lease obligations | $ 80 | $ 80 |
Segment Information - Segment S
Segment Information - Segment Sales (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Segment Reporting Information, Profit (Loss) | |||||||||||
Net sales | $ 278.6 | $ 311.2 | $ 308.6 | $ 235.2 | $ 229.5 | $ 264.1 | $ 260.3 | $ 218.5 | $ 1,133.6 | $ 972.4 | $ 908.3 |
Segment operating profits | 263.5 | 202.3 | 163.6 | ||||||||
Separation costs | 0 | (0.9) | (17.5) | ||||||||
Restructuring and other income (charges) | 0.5 | (3.7) | (41.2) | ||||||||
Acquisition and other related costs | (12.2) | (7.1) | 0 | ||||||||
Pension and postretirement settlement and curtailment income (charges) | (0.2) | 0 | 0 | ||||||||
Interest expense | (33.2) | (18.1) | (19.3) | ||||||||
Interest income | 3.4 | 2.3 | 1.4 | ||||||||
(Provision) benefit for income taxes | (40) | (29.6) | (42.6) | ||||||||
Net (income) loss attributable to noncontrolling interests | 0 | (2.2) | (5.5) | (5) | (6.4) | (4.6) | (3.7) | (4) | (12.7) | (18.7) | (9.2) |
Net income (loss) attributable to Ingevity stockholders | $ 42.1 | $ 49.5 | $ 46.7 | $ 30.8 | $ 41.6 | $ 33.8 | $ 32.1 | $ 19 | 169.1 | 126.5 | 35.2 |
Performance Materials | |||||||||||
Segment Reporting Information, Profit (Loss) | |||||||||||
Net sales | 400.4 | 349.3 | 301 | ||||||||
Segment operating profits | 147.2 | 122 | 106.9 | ||||||||
Performance Chemicals | |||||||||||
Segment Reporting Information, Profit (Loss) | |||||||||||
Net sales | 733.2 | 623.1 | 607.3 | ||||||||
Segment operating profits | $ 116.3 | $ 80.3 | $ 56.7 |
Segment Information - Acquisiti
Segment Information - Acquisition Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Segment Reporting [Abstract] | |||
Legal and professional service fees | $ 6.9 | $ 7.1 | $ 0 |
Inventory fair value step-up amortization | 1.4 | 0 | 0 |
Purchase price hedge adjustment | 3.9 | 0 | 0 |
Acquisition and other related costs | $ 12.2 | $ 7.1 | $ 0 |
Segment Information - Customer
Segment Information - Customer Sales (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenue, Major Customer [Line Items] | |||||||||||
Net sales | $ 278.6 | $ 311.2 | $ 308.6 | $ 235.2 | $ 229.5 | $ 264.1 | $ 260.3 | $ 218.5 | $ 1,133.6 | $ 972.4 | $ 908.3 |
Performance Materials | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Net sales | 400.4 | 349.3 | 301 | ||||||||
Performance Materials | Automotive Technologies product line | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Net sales | 362 | 312.5 | 263.5 | ||||||||
Performance Materials | Process Purification product line | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Net sales | 38.4 | 36.8 | 37.5 | ||||||||
Performance Chemicals | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Net sales | 733.2 | 623.1 | 607.3 | ||||||||
Performance Chemicals | Pavement Technologies product line | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Net sales | 178.5 | 163 | 148.8 | ||||||||
Performance Chemicals | Oilfield Technologies product line | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Net sales | 114.2 | 77.8 | 58.5 | ||||||||
Performance Chemicals | Industrial Specialties product line | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Net sales | $ 440.5 | $ 382.3 | $ 400 |
Segment Information - Depreciat
Segment Information - Depreciation and amortization, and capital expenditures (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Segment Reporting Information | |||
Depreciation and amortization | $ 57 | $ 40.4 | $ 38.8 |
Capital expenditures | 93.9 | 52.6 | 56.7 |
Performance Materials | |||
Segment Reporting Information | |||
Depreciation and amortization | 22.2 | 19.8 | 16.4 |
Capital expenditures | 65.4 | 36.9 | 39.6 |
Performance Chemicals | |||
Segment Reporting Information | |||
Depreciation and amortization | 34.8 | 20.6 | 22.4 |
Capital expenditures | $ 28.5 | $ 15.7 | $ 17.1 |
Segment Information - Geographi
Segment Information - Geographical Sales and Property, pant and equipment, net (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues from External Customers and Long-Lived Assets | |||||||||||
Net sales | $ 278.6 | $ 311.2 | $ 308.6 | $ 235.2 | $ 229.5 | $ 264.1 | $ 260.3 | $ 218.5 | $ 1,133.6 | $ 972.4 | $ 908.3 |
Property, plant and equipment, net | 523.8 | 438.5 | 523.8 | 438.5 | |||||||
North America | |||||||||||
Revenues from External Customers and Long-Lived Assets | |||||||||||
Net sales | 770.4 | 662.9 | 597.8 | ||||||||
Property, plant and equipment, net | 444.4 | 358.4 | 444.4 | 358.4 | |||||||
Asia Pacific | |||||||||||
Revenues from External Customers and Long-Lived Assets | |||||||||||
Net sales | 171.4 | 142.5 | 138.8 | ||||||||
Property, plant and equipment, net | 78.7 | 79.3 | 78.7 | 79.3 | |||||||
Europe, Middle East and Africa | |||||||||||
Revenues from External Customers and Long-Lived Assets | |||||||||||
Property, plant and equipment, net | 0.6 | 0.7 | 0.6 | 0.7 | |||||||
South America | |||||||||||
Revenues from External Customers and Long-Lived Assets | |||||||||||
Net sales | 21.9 | 17.8 | $ 20.6 | ||||||||
Property, plant and equipment, net | $ 0.1 | $ 0.1 | $ 0.1 | $ 0.1 |
Segment information - Assets (D
Segment information - Assets (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Segment Reporting Information | ||
Assets | $ 1,315.2 | $ 929.6 |
Operating Segments | ||
Segment Reporting Information | ||
Assets | 1,303.5 | 918.7 |
Operating Segments | Performance Materials | ||
Segment Reporting Information | ||
Assets | 547.8 | 438.9 |
Operating Segments | Performance Chemicals | ||
Segment Reporting Information | ||
Assets | 755.7 | 479.8 |
Corporate and other | ||
Segment Reporting Information | ||
Assets | $ 11.7 | $ 10.9 |
Earnings (Loss) per Share - Sch
Earnings (Loss) per Share - Schedule of Earnings per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Earnings Per Share Reconciliation | |||||||||||
Net income (loss) attributable to Ingevity stockholders | $ 42.1 | $ 49.5 | $ 46.7 | $ 30.8 | $ 41.6 | $ 33.8 | $ 32.1 | $ 19 | $ 169.1 | $ 126.5 | $ 35.2 |
Basic and Diluted earnings (loss) per share | |||||||||||
Basic earnings per share (usd per share) | $ 1.01 | $ 1.18 | $ 1.11 | $ 0.73 | $ 0.98 | $ 0.80 | $ 0.76 | $ 0.45 | $ 4.02 | $ 3 | $ 0.83 |
Diluted earnings per share (usd per share) | $ 0.99 | $ 1.16 | $ 1.10 | $ 0.72 | $ 0.97 | $ 0.79 | $ 0.76 | $ 0.45 | $ 3.97 | $ 2.97 | $ 0.83 |
Weighted average shares outstanding | |||||||||||
Weighted average number of shares outstanding - Basic (shares) | 41,900 | 42,000 | 42,100 | 42,100 | 42,100 | 42,100 | 42,100 | 42,100 | 42,037 | 42,130 | 42,108 |
Weighted average additional shares assuming conversion of potential common shares (shares) | 564 | 399 | 163 | ||||||||
Weighted average number of shares outstanding - Diluted (shares) | 42,500 | 42,700 | 42,600 | 42,600 | 42,600 | 42,500 | 42,400 | 42,400 | 42,601 | 42,529 | 42,271 |
Earnings (Loss) per Share - Ant
Earnings (Loss) per Share - Antidilutive (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |||
Potentially anti dilutive shares (shares) | 84 | 79 | 4 |
Supplemental Information - Prep
Supplemental Information - Prepaid and Other Current Assets (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Income and value added tax receivables | $ 15 | $ 8.2 | |
Prepaid freight and supply agreements | 1.1 | 0.8 | |
Prepaid insurance | 1.7 | 1.3 | |
Non-trade receivables | 3.4 | 2.4 | |
Advances to suppliers | 1.5 | 0.8 | |
Equity securities, foreign currency, commodity hedging | 0.7 | 1.8 | |
Contract asset | 5.1 | 0 | |
Other | 6.4 | 5.5 | |
Prepaid and other current assets | $ 34.9 | $ 25.9 | $ 20.8 |
Supplemental Information - Othe
Supplemental Information - Other Assets (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Deferred financing charges | $ 3.1 | $ 2.7 |
Capitalized software, net (Note 3) | 9.5 | 12.5 |
Land-use rights | 5.6 | 6 |
Planned major maintenance activities | 3.2 | 2.1 |
Deferred compensation plan assets | 4.4 | 0 |
Other | 12.5 | 7.1 |
Other assets | $ 38.3 | $ 30.4 |
Supplemental Information - Accr
Supplemental Information - Accrued Expenses (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Accrued interest | $ 8.5 | $ 3.1 | |
Accrued taxes | 3 | 1.7 | |
Accrued freight | 5.1 | 1.9 | |
Accrued rebates | 6.4 | 4.9 | |
Restructuring reserves | 0 | 0.2 | |
Separation-related reimbursement awards (Notes 6) | 0.1 | 0.9 | |
Accrued royalties and commissions | 1.8 | 1.7 | |
Foreign currency hedging | 3.9 | 0 | |
Other | 7.9 | 5.6 | |
Accrued expenses | $ 36.7 | $ 20.9 | $ 20 |
Supplemental Information - Ot_2
Supplemental Information - Other Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Deferred compensation arrangements | $ 4.6 | $ 2 |
Pension & OPEB liabilities | 7.5 | 7 |
Unrecognized tax benefits | 0.3 | 0.3 |
Other | 2.7 | 3.9 |
Other liabilities | $ 15.1 | $ 13.2 |
Supplemental Information - Ot_3
Supplemental Information - Other (Income) Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Foreign currency translation (gain)/loss | $ 2 | $ 1.2 | $ (2.9) |
Royalty (income)/expense | (0.8) | (0.7) | (1) |
Nonoperating Gains (Losses) | (0.2) | 0 | 0.7 |
Other (income) expense, net | $ 1 | $ 0.5 | $ (3.2) |
Quarterly Financial Informati_3
Quarterly Financial Information (Unaudited) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net sales | $ 278.6 | $ 311.2 | $ 308.6 | $ 235.2 | $ 229.5 | $ 264.1 | $ 260.3 | $ 218.5 | $ 1,133.6 | $ 972.4 | $ 908.3 |
Gross profit | 97.6 | 118.6 | 115.5 | 85.1 | 75.3 | 93.2 | 89.8 | 70.7 | 416.8 | 329 | 274.4 |
Income (loss) before taxes | 43.6 | 68.1 | 64.6 | 45.5 | 32.7 | 55.1 | 53 | 34 | 221.8 | 174.8 | 87 |
Net income (loss) | 42.1 | 51.7 | 52.2 | 35.8 | 48 | 38.4 | 35.8 | 23 | 181.8 | 145.2 | 44.4 |
Less: Net income (loss) attributable to noncontrolling interests | 0 | 2.2 | 5.5 | 5 | 6.4 | 4.6 | 3.7 | 4 | 12.7 | 18.7 | 9.2 |
Net income (loss) attributable to Ingevity stockholders | $ 42.1 | $ 49.5 | $ 46.7 | $ 30.8 | $ 41.6 | $ 33.8 | $ 32.1 | $ 19 | $ 169.1 | $ 126.5 | $ 35.2 |
Basic earnings (loss) per common share attributable to Ingevity stockholders (in dollars per share) | $ 1.01 | $ 1.18 | $ 1.11 | $ 0.73 | $ 0.98 | $ 0.80 | $ 0.76 | $ 0.45 | $ 4.02 | $ 3 | $ 0.83 |
Diluted earnings (loss) per common share attributable to Ingevity stockholders (in dollars per share) | $ 0.99 | $ 1.16 | $ 1.10 | $ 0.72 | $ 0.97 | $ 0.79 | $ 0.76 | $ 0.45 | $ 3.97 | $ 2.97 | $ 0.83 |
Weighted average shares outstanding | |||||||||||
Weighted average number of shares outstanding - Basic (shares) | 41,900 | 42,000 | 42,100 | 42,100 | 42,100 | 42,100 | 42,100 | 42,100 | 42,037 | 42,130 | 42,108 |
Weighted average number of shares outstanding - diluted (shares) | 42,500 | 42,700 | 42,600 | 42,600 | 42,600 | 42,500 | 42,400 | 42,400 | 42,601 | 42,529 | 42,271 |
Subsequent Event (Details)
Subsequent Event (Details) € in Millions, $ in Millions | Feb. 13, 2019USD ($) | Feb. 13, 2019EUR (€) | Feb. 13, 2019EUR (€) | Dec. 31, 2018USD ($) | Dec. 10, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Subsequent Event [Line Items] | |||||||
Goodwill | $ 130.7 | $ 12.4 | $ 12.4 | ||||
Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Letter of credit remaining amount | $ 113.1 | ||||||
Caprolactone Acquisition | |||||||
Subsequent Event [Line Items] | |||||||
Business acquisition price, net | $ 570.9 | ||||||
Caprolactone Acquisition | Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Purchase price | 652.5 | € 578.9 | |||||
Liabilities assumed | 113.1 | € 100.4 | |||||
Goodwill | 310 | ||||||
Intangible and tangible assets acquired | $ 220 |
Schedule II - Valuation and Q_2
Schedule II - Valuation and Qualifying Accounts and Reserves (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Reserve for doubtful accounts | |||
Movement in Valuation Allowances and Reserves | |||
Balance, Beginning of Year | $ 0.4 | $ 0.3 | $ 0.1 |
Charged to Costs and Expenses | 0 | 0.1 | 0.2 |
Write-offs | 0 | 0 | 0 |
Balance, End of Year | 0.4 | 0.4 | 0.3 |
Deferred tax valuation allowance | |||
Movement in Valuation Allowances and Reserves | |||
Balance, Beginning of Year | 20.4 | 18.8 | 6.6 |
Charged to Costs and Expenses | (2.6) | 1.7 | 13.2 |
Charged to Other Comprehensive Income | (2.3) | (0.1) | (1) |
Write-offs | 0 | 0 | 0 |
Balance, End of Year | $ 15.5 | $ 20.4 | $ 18.8 |
Uncategorized Items - ngvt-2018
Label | Element | Value |
Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 1,600,000 |