Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2020 | Jul. 30, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-38221 | |
Entity Registrant Name | PQ Group Holdings Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 81-3406833 | |
Entity Address, Address Line One | 300 Lindenwood Drive | |
Entity Address, City or Town | Malvern | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 19355 | |
City Area Code | (610) | |
Local Phone Number | 651-4400 | |
Title of 12(b) Security | Common stock, par value $0.01 per share | |
Trading Symbol | PQG | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 136,048,286 | |
Entity Central Index Key | 0001708035 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Statement [Abstract] | ||||
Sales | $ 359,525 | $ 431,675 | $ 721,123 | $ 790,896 |
Cost of goods sold | 266,686 | 316,180 | 539,685 | 594,491 |
Gross profit | 92,839 | 115,495 | 181,438 | 196,405 |
Selling, general and administrative expenses | 38,926 | 43,375 | 82,224 | 84,083 |
Other operating expense, net | 12,735 | 1,819 | 34,677 | 12,558 |
Operating income | 41,178 | 70,301 | 64,537 | 99,764 |
Equity in net (income) from affiliated companies | (11,492) | (12,300) | (19,842) | (14,364) |
Interest expense, net | 22,275 | 28,540 | 46,730 | 57,158 |
Debt extinguishment costs | 0 | 0 | 2,513 | 0 |
Other (income) expense, net | (2,114) | 3,035 | 691 | 56 |
Income before income taxes and noncontrolling interest | 32,509 | 51,026 | 34,445 | 56,914 |
Provision for income taxes | 16,262 | 20,307 | 17,689 | 22,754 |
Net income | 16,247 | 30,719 | 16,756 | 34,160 |
Less: Net income attributable to the noncontrolling interest | 321 | 145 | 606 | 435 |
Net income attributable to PQ Group Holdings Inc. | $ 15,926 | $ 30,574 | $ 16,150 | $ 33,725 |
Net income per share: | ||||
Basic income per share (usd per share) | $ 0.12 | $ 0.23 | $ 0.12 | $ 0.25 |
Diluted income per share (usd per share) | $ 0.12 | $ 0.23 | $ 0.12 | $ 0.25 |
Weighted average shares outstanding: | ||||
Basic (shares) | 135,083,126 | 134,142,552 | 135,278,764 | 134,044,972 |
Diluted (shares) | 135,671,830 | 135,323,024 | 136,079,540 | 135,107,007 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 16,247 | $ 30,719 | $ 16,756 | $ 34,160 |
Other comprehensive income (loss), net of tax: | ||||
Pension and postretirement benefits | (13) | (31) | (28) | (61) |
Net (loss) gain from hedging activities | 495 | (1,167) | (34) | (2,719) |
Foreign currency translation | 11,939 | 6,085 | (34,416) | 13,252 |
Total other comprehensive income (loss) | 12,421 | 4,887 | (34,478) | 10,472 |
Comprehensive income (loss) | 28,668 | 35,606 | (17,722) | 44,632 |
Less: Comprehensive income (loss) attributable to noncontrolling interests | 697 | 285 | (2,506) | 890 |
Comprehensive income (loss) attributable to PQ Group Holdings Inc. | $ 27,971 | $ 35,321 | $ (15,216) | $ 43,742 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
ASSETS | ||
Cash and cash equivalents | $ 88,640 | $ 72,284 |
Accounts receivable, net | 197,777 | 179,632 |
Inventories, net | 266,620 | 280,945 |
Prepaid and other current assets | 34,667 | 35,730 |
Total current assets | 587,704 | 568,591 |
Investments in affiliated companies | 476,668 | 472,929 |
Property, plant and equipment, net | 1,132,665 | 1,186,770 |
Goodwill | 1,254,998 | 1,259,805 |
Other intangible assets, net | 643,226 | 676,385 |
Right-of-use lease assets | 50,293 | 57,295 |
Other long-term assets | 101,656 | 99,070 |
Total assets | 4,247,210 | 4,320,845 |
LIABILITIES | ||
Notes payable and current maturities of long-term debt | 8,602 | 7,766 |
Accounts payable | 109,231 | 144,365 |
Operating lease liabilities—current | 14,392 | 15,183 |
Accrued liabilities | 88,893 | 102,154 |
Total current liabilities | 221,118 | 269,468 |
Long-term debt, excluding current portion | 1,898,943 | 1,899,196 |
Deferred income taxes | 222,180 | 218,037 |
Operating lease liabilities—noncurrent | 34,799 | 40,156 |
Other long-term liabilities | 93,996 | 108,670 |
Total liabilities | 2,471,036 | 2,535,527 |
Commitments and contingencies (Note 17) | ||
EQUITY | ||
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (shares) | 450,000,000 | 450,000,000 |
Common stock, shares issued (shares) | 136,763,507 | 136,861,382 |
Common stock, shares outstanding (shares) | 136,045,822 | 136,464,961 |
Common Stock, Value, Issued | $ 1,368 | $ 1,369 |
Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (shares) | 0 | 0 |
Preferred stock, shares outstanding (shares) | 0 | 0 |
Preferred Stock, Value, Issued | $ 0 | $ 0 |
Additional paid-in capital | 1,709,367 | 1,696,899 |
Retained earnings | $ 119,163 | $ 103,013 |
Treasury stock (shares) | 717,685 | 396,421 |
Treasury Stock, Value | $ (10,372) | $ (6,483) |
Accumulated other comprehensive loss | (46,714) | (15,348) |
Total PQ Group Holdings Inc. equity | 1,772,812 | 1,779,450 |
Noncontrolling interest | 3,362 | 5,868 |
Total equity | 1,776,174 | 1,785,318 |
Total liabilities and equity | $ 4,247,210 | $ 4,320,845 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands | Total | Cumulative effect adjustment from adoption of new accounting standards | Beginning balance, adjusted balance | Common stock | Common stockBeginning balance, adjusted balance | Additional paid-in capital | Additional paid-in capitalBeginning balance, adjusted balance | Retained earnings | Retained earningsCumulative effect adjustment from adoption of new accounting standards | Retained earningsBeginning balance, adjusted balance | Treasury stock, at cost | Treasury stock, at cost Beginning balance, adjusted balance | Accumulated other comprehensive income (loss) | Accumulated other comprehensive income (loss)Cumulative effect adjustment from adoption of new accounting standards | Accumulated other comprehensive income (loss)Beginning balance, adjusted balance | Non- controlling interest | Non- controlling interestBeginning balance, adjusted balance |
Beginning balance at Dec. 31, 2018 | $ 1,664,145 | $ (175) | $ 1,663,970 | $ 1,358 | $ 1,358 | $ 1,674,703 | $ 1,674,703 | $ 25,523 | $ (2,049) | $ 23,474 | $ (2,920) | $ (2,920) | $ (39,104) | $ 1,874 | $ (37,230) | $ 4,585 | $ 4,585 |
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||
Net income | 3,441 | 3,151 | 290 | ||||||||||||||
Other comprehensive income | 5,585 | 5,270 | 315 | ||||||||||||||
Repurchases of common shares | (1,339) | (1,339) | |||||||||||||||
Stock compensation expense | 3,400 | 3,400 | |||||||||||||||
Shares issued under equity incentive plan, net of forfeitures | 215 | 2 | 213 | ||||||||||||||
Ending balance at Mar. 31, 2019 | 1,675,272 | 1,360 | 1,678,316 | 26,625 | (4,259) | (31,960) | 5,190 | ||||||||||
Beginning balance at Dec. 31, 2018 | 1,664,145 | $ (175) | $ 1,663,970 | 1,358 | $ 1,358 | 1,674,703 | $ 1,674,703 | 25,523 | $ (2,049) | $ 23,474 | (2,920) | $ (2,920) | (39,104) | $ 1,874 | $ (37,230) | 4,585 | $ 4,585 |
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||
Net income | 34,160 | ||||||||||||||||
Other comprehensive income | 10,472 | ||||||||||||||||
Ending balance at Jun. 30, 2019 | 1,719,352 | 1,364 | 1,686,942 | 57,199 | (4,259) | (27,213) | 5,319 | ||||||||||
Beginning balance at Mar. 31, 2019 | 1,675,272 | 1,360 | 1,678,316 | 26,625 | (4,259) | (31,960) | 5,190 | ||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||
Net income | 30,719 | 30,574 | 145 | ||||||||||||||
Other comprehensive income | 4,887 | 4,747 | 140 | ||||||||||||||
Distributions to noncontrolling interests | (156) | (156) | |||||||||||||||
Stock compensation expense | 5,370 | 5,370 | |||||||||||||||
Shares issued under equity incentive plan, net of forfeitures | 3,260 | 4 | 3,256 | ||||||||||||||
Ending balance at Jun. 30, 2019 | 1,719,352 | 1,364 | 1,686,942 | 57,199 | (4,259) | (27,213) | 5,319 | ||||||||||
Beginning balance at Dec. 31, 2019 | 1,785,318 | 1,369 | 1,696,899 | 103,013 | (6,483) | (15,348) | 5,868 | ||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||
Net income | 509 | 224 | 285 | ||||||||||||||
Other comprehensive income | (46,899) | (43,411) | (3,488) | ||||||||||||||
Repurchases of common shares | (3,889) | (3,889) | |||||||||||||||
Stock compensation expense | 5,920 | 5,920 | |||||||||||||||
Shares issued under equity incentive plan, net of forfeitures | 181 | 4 | 177 | ||||||||||||||
Ending balance at Mar. 31, 2020 | 1,741,140 | 1,373 | 1,702,996 | 103,237 | (10,372) | (58,759) | 2,665 | ||||||||||
Beginning balance at Dec. 31, 2019 | 1,785,318 | 1,369 | 1,696,899 | 103,013 | (6,483) | (15,348) | 5,868 | ||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||
Net income | 16,756 | ||||||||||||||||
Other comprehensive income | (34,478) | ||||||||||||||||
Ending balance at Jun. 30, 2020 | 1,776,174 | 1,368 | 1,709,367 | 119,163 | (10,372) | (46,714) | 3,362 | ||||||||||
Beginning balance at Mar. 31, 2020 | 1,741,140 | 1,373 | 1,702,996 | 103,237 | (10,372) | (58,759) | 2,665 | ||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||
Net income | 16,247 | 15,926 | 321 | ||||||||||||||
Other comprehensive income | 12,421 | 12,045 | 376 | ||||||||||||||
Stock compensation expense | 6,366 | 6,366 | |||||||||||||||
Shares issued under equity incentive plan, net of forfeitures | 0 | (5) | 5 | ||||||||||||||
Ending balance at Jun. 30, 2020 | $ 1,776,174 | $ 1,368 | $ 1,709,367 | $ 119,163 | $ (10,372) | $ (46,714) | $ 3,362 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Cash flows from operating activities: | ||
Net income | $ 16,756 | $ 34,160 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 66,744 | 65,535 |
Amortization | 23,749 | 25,449 |
Amortization of deferred financing costs and original issue discount | 2,427 | 2,872 |
Foreign currency exchange loss | 2,483 | 923 |
Pension and postretirement healthcare benefit expense | (3) | 2,185 |
Pension and postretirement healthcare benefit funding | (4,153) | (3,632) |
Deferred income tax provision | 5,990 | 10,844 |
Net (gain) loss on asset disposals | 8,401 | (8,839) |
Stock compensation | 12,286 | 8,770 |
Equity in net income from affiliated companies | (19,842) | (14,364) |
Dividends received from affiliated companies | 15,098 | 5,072 |
Net interest income on swaps designated as net investment hedges | (2,197) | (4,478) |
Other, net | (1,225) | (4,356) |
Working capital changes that provided (used) cash, excluding the effect of acquisitions and dispositions: | ||
Receivables | (24,601) | (46,261) |
Inventories | (9,276) | (12,191) |
Prepaids and other current assets | 42 | 2,183 |
Accounts payable | (15,322) | (189) |
Accrued liabilities | (15,248) | (3,691) |
Net cash provided by operating activities | 62,109 | 59,992 |
Cash flows from investing activities: | ||
Purchases of property, plant and equipment | (50,510) | (65,475) |
Proceeds from sale of product line | 0 | 26,665 |
Proceeds from sale of assets | 10,330 | 0 |
Proceeds from sale of investment | (1,761) | 0 |
Net interest proceeds on swaps designated as net investment hedges | 2,197 | 4,478 |
Other, net | 0 | 475 |
Net cash used in investing activities | (36,222) | (33,857) |
Cash flows from financing activities: | ||
Draw down of revolving credit facilities | 164,704 | 74,863 |
Repayments of revolving credit facilities | (163,928) | (72,247) |
Debt issuance costs | (3,023) | 0 |
Repayments of long-term debt | 0 | (5,000) |
Stock repurchases | (3,889) | (1,339) |
Proceeds from stock options exercised | 181 | 3,475 |
Other, net | 0 | (153) |
Net cash used in financing activities | (5,955) | (401) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (3,261) | (1,501) |
Net change in cash, cash equivalents and restricted cash | 16,671 | 24,233 |
Cash, cash equivalents and restricted cash at beginning of period | 73,917 | 59,726 |
Cash, cash equivalents and restricted cash at end of period | $ 90,588 | $ 83,959 |
Background and Basis of Present
Background and Basis of Presentation | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Background and Basis of Presentation | 1. Background and Basis of Presentation: Description of Business PQ Group Holdings Inc. and subsidiaries (the “Company” or “PQ Group Holdings”) is a leading integrated and innovative global provider of specialty catalysts, materials, chemicals and services. The Company supports customers globally through its strategically located network of manufacturing facilities. The Company believes that its products, which are predominantly inorganic, and services contribute to improving the sustainability of the environment. The Company has four uniquely positioned specialty businesses: Refining Services provides sulfuric acid recycling to the North American refining industry; Catalysts serves the packaging and engineered plastics industry and, through its Zeolyst joint venture, the global refining, petrochemical and emissions control industries; Performance Materials produces transportation reflective safety markings for roads and airports; and Performance Chemicals supplies diverse product end uses, including personal and industrial cleaning products, fuel-efficient tires, surface coatings, and food and beverage products. Seasonal changes and weather conditions typically affect the Company’s Performance Materials and Refining Services segments. In particular, the Company’s Performance Materials segment generally experiences lower sales and profit in the first and fourth quarters of the year because highway striping projects typically occur during warmer weather months. The Company’s Refining Services segment typically experiences similar seasonal fluctuations as a result of higher demand for gasoline products in the summer months. As a result, working capital requirements tend to be higher in the first and second quarters of the year, which can adversely affect the Company’s liquidity and cash flows. Because of this seasonality associated with certain of the Company’s segments, results for any one quarter are not necessarily indicative of the results that may be achieved for any other quarter or for the full year. Basis of Presentation The condensed consolidated financial statements included herein are unaudited. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations for interim reporting. In the opinion of management, all adjustments of a normal and recurring nature necessary to state fairly the financial position and results of operations have been included. The results of operations are not necessarily indicative of the results to be expected for the full year. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. COVID-19 In March 2020, the outbreak of a novel coronavirus (“COVID-19”) was declared a national emergency in the United States. COVID-19 continues to spread in the United States and other parts of the world and has adversely impacted economic activity and contributed to volatility in financial markets. In response to the COVID-19 pandemic, the federal government and various state, local and foreign governments have issued decrees and orders that have disrupted many businesses and implemented social distancing, travel and other restrictions. In response to these restrictions, the Company has taken a variety of actions, including an international travel ban, distribution of personal protective equipment to employees and work-at-home requirements for many of the Company’s employees who are not an integral part of its manufacturing operations. The Company has also implemented and refined its existing business continuity plans in an effort to minimize operational disruptions. The Company’s manufacturing operations, as well as the operations of its key vendors and the majority of its key customers, have continued to operate with limited interruptions. The extent and impact of the COVID-19 pandemic on the Company’s business is highly uncertain and difficult to predict due to the rapidly evolving environment and continued uncertainties created by the COVID-19 pandemic. The Company is not aware of any specific event or circumstance that would require an update to our estimates or judgments or a revision of the carrying value of its assets or liabilities as of the date of the issuance of the condensed consolidated financial statements. These estimates may change, as the pandemic continues to evolve and the duration remains uncertain, and may adversely impact the Company’s results of operations, financial condition or cash flow. |
New Accounting Standards
New Accounting Standards | 6 Months Ended |
Jun. 30, 2020 | |
New Accounting Standards [Abstract] | |
Recently Adopted Accounting Standards | 2. New Accounting Standards: Recently Adopted Accounting Standards In June 2016, the Financial Accounting Standards Board (“FASB”) issued guidance that affects loans, trade receivables and any other financial assets that have the contractual right to receive cash. Under the new guidance, an entity is required to recognize expected credit losses rather than incurred losses for financial assets. The new guidance is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. The Company adopted the new guidance effective January 1, 2020, with no material impact to the Company’s consolidated financial position, results of operations or cash flows. In August 2018, the FASB issued guidance which modifies certain disclosure requirements over fair value measurements. The guidance is effective for fiscal years beginning after December 15, 2019, including all interim periods within that fiscal year. The Company adopted the new guidance effective January 1, 2020. The Company does not classify any of its derivative contracts as Level 3 assets or liabilities, nor did the Company have any transfers amongst fair value levels during the six months ended June 30, 2020. As such, the guidance did not have an impact on the fair value measurement disclosures included in the Company’s consolidated financial statements. In January 2017, the FASB issued guidance which eliminates the second step from the traditional two-step goodwill impairment test. Under current guidance, an entity performed the first step of the goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount; if an impairment loss was indicated, the entity computed the implied fair value of goodwill to determine whether an impairment loss existed, and if so, the amount to recognize. Under the new guidance, an impairment loss is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value (the Step 1 test), with no further testing required. Any impairment loss recognized is limited to the amount of goodwill allocated to the reporting unit. The new guidance is effective for public companies that are Securities and Exchange Commission (“SEC”) registrants for fiscal years beginning after December 15, 2019, with early adoption permitted for goodwill impairment tests performed on testing dates after January 1, 2017. The Company adopted the new guidance on January 1, 2020, and will apply the guidance prospectively to its goodwill impairment tests. |
Accounting Standards Not Yet Adopted | Accounting Standards Not Yet Adopted In December 2019, the FASB issued new guidance to simplify the accounting for income taxes by removing certain exceptions to the general principles and also simplification of areas such as franchise taxes, step-up in tax basis goodwill, separate entity financial statements and interim recognition of enactment of tax laws or rate changes. The new guidance is effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of this new guidance on its consolidated financial statements. In March 2020, the FASB issued guidance to address certain accounting consequences from the anticipated transition from the use of the London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates. The new guidance contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance is optional and may be elected over time as reference rate reform activities occur. During the three months ended June 30, 2020, the Company elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based on matches the index of the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 6 Months Ended |
Jun. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | 3. Revenue from Contracts with Customers: Disaggregated Revenue The Company’s primary means of disaggregating revenues is by reportable segments, which can be found in Note 18 to these condensed consolidated financial statements. The Company’s portfolio of products are integrated into a variety of end uses, which are described in the table below. Key End Uses Key Products Industrial & process chemicals • Silicate precursors for the tire industry • Glass beads, or microspheres, for metal finishing end uses Fuels & emission control • Refinery catalysts • Emission control catalysts • Catalyst recycling services • Silicate for catalyst manufacturing Packaging & engineered plastics • Catalysts for high-density polyethlene and chemicals syntheses • Antiblocks for film packaging • Solid and hollow microspheres for composite plastics • Sulfur derivatives for nylon production Highway safety & construction • Reflective markings for roadways and airports • Silica gels for surface coatings Consumer products • Silica gels for edible oil and beer clarification • Precipitated silicas, silicates and zeolites for the dentifrice and dishwasher and laundry detergent applications Natural resources • Silicates for drilling muds • Hollow glass beads, or microspheres, for oil well cements • Silicates and alum for water treatment mining • Bleaching aids for paper The following tables disaggregate the Company’s sales, by segment and end use, for the three and six months ended June 30, 2020 and 2019: Three months ended June 30, 2020 Refining Catalysts Performance Performance Total Industrial & process chemicals $ 16,713 $ 2 $ 9,314 $ 43,747 $ 69,776 Fuels & emission control (1) 50,681 — 42 — 50,723 Packaging & engineered plastics 7,473 25,206 13,645 9,552 55,876 Highway safety & construction (1) — — 78,340 18,312 96,652 Consumer products — — — 59,907 59,907 Natural resources 15,565 — 2,862 11,123 29,550 Total segment sales 90,432 25,208 104,203 142,641 362,484 Eliminations (780) (2) (54) (2,123) (2,959) Total $ 89,652 $ 25,206 $ 104,149 $ 140,518 $ 359,525 Three months ended June 30, 2019 Refining Catalysts Performance Performance Total Industrial & process chemicals $ 21,903 $ — $ 12,783 $ 60,662 $ 95,348 Fuels & emission control (1) 63,505 — — — 63,505 Packaging & engineered plastics 14,067 20,857 17,595 14,344 66,863 Highway safety & construction (1) — — 85,257 22,297 107,554 Consumer products — — — 65,440 65,440 Natural resources 17,815 — 3,237 15,085 36,137 Total segment sales 117,290 20,857 118,872 177,828 434,847 Eliminations (895) 214 (104) (2,387) (3,172) Total $ 116,395 $ 21,071 $ 118,768 $ 175,441 $ 431,675 Six months ended June 30, 2020 Refining Catalysts Performance Performance Total Industrial & process chemicals $ 36,071 $ 49 $ 21,438 $ 103,581 $ 161,139 Fuels & emission control (1) 106,393 — 81 — 106,474 Packaging & engineered plastics 18,207 50,023 31,115 23,827 123,172 Highway safety & construction (1) — — 110,983 38,501 149,484 Consumer products — — — 123,933 123,933 Natural resources 30,452 — 6,155 27,078 63,685 Total segment sales 191,123 50,072 169,772 316,920 727,887 Eliminations (1,705) (49) (109) (4,901) (6,764) Total $ 189,418 $ 50,023 $ 169,663 $ 312,019 $ 721,123 Six months ended June 30, 2019 Refining Catalysts Performance Performance Total Industrial & process chemicals $ 40,305 $ 62 $ 25,812 $ 120,313 $ 186,492 Fuels & emission control (1) 121,195 — — — 121,195 Packaging & engineered plastics 26,756 36,661 34,977 29,073 127,467 Highway safety & construction (1) — — 112,617 44,236 156,853 Consumer products — — — 133,949 133,949 Natural resources 34,878 — 6,555 30,719 72,152 Total segment sales 223,134 36,723 179,961 358,290 798,108 Eliminations (1,782) (62) (152) (5,216) (7,212) Total $ 221,352 $ 36,661 $ 179,809 $ 353,074 $ 790,896 (1) As described in Note 1, the Company experiences seasonal sales fluctuations to customers in the fuels & emission control and highway safety & construction end uses. Contract Assets and Liabilities A contract asset is a right to consideration in exchange for goods that the Company has transferred to a customer when that right is conditional on something other than the passage of time. A contract liability exists when the Company receives consideration in advance of performance obligations. The Company has no contract assets on its condensed consolidated balance sheets as of June 30, 2020 and December 31, 2019. The Company recognized a $9,000 contract liability associated with the sale of a portion of its sulfate salts product line in June 2019, of which $4,140 and $6,450 of deferred revenue remained as of June 30, 2020 and December 31, 2019, respectively. The Company recognized revenue of $1,035 and $2,304 related to this contra ct liability during the three and six months ended June 30, 2020. The Company did not recognize revenue related to this contract liability during the three and six months ended June 30, 2019. Refer to Note 7 of these condensed consolidated financial statements for additional information related to the sale of the product line. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 4. Fair Value Measurements: Fair values are based on quoted market prices when available. When market prices are not available, fair values are generally estimated using discounted cash flow analyses, incorporating current market inputs for similar financial instruments with comparable terms and credit quality. In instances where there is little or no market activity for the same or similar instruments, the Company estimates fair values using methods, models and assumptions that management believes a hypothetical market participant would use to determine a current transaction price. These valuation techniques involve some level of management estimation and judgment that becomes significant with increasingly complex instruments or pricing models. Where appropriate, adjustments are included to reflect the risk inherent in a particular methodology, model or input used. The Company’s financial assets and liabilities carried at fair value have been classified based upon a fair value hierarchy. The hierarchy gives the highest ranking to fair values determined using unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest ranking to fair values determined using methodologies and models with unobservable inputs (Level 3). The classification of an asset or a liability is based on the lowest level input that is significant to its measurement. For example, a Level 3 fair value measurement may include inputs that are both observable (Levels 1 and 2) and unobservable (Level 3). The levels of the fair value hierarchy are as follows: • Level 1—Values are unadjusted quoted prices for identical assets and liabilities in active markets accessible at the measurement date. Active markets provide pricing data for trades occurring at least weekly and include exchanges and dealer markets. • Level 2—Inputs include quoted prices for similar assets or liabilities in active markets, quoted prices from those willing to trade in markets that are not active, or other inputs that are observable or can be corroborated by market data for the term of the instrument. Such inputs include market interest rates and volatilities, spreads and yield curves. • Level 3—Certain inputs are unobservable (supported by little or no market activity) and significant to the fair value measurement. Unobservable inputs reflect the Company’s best estimate of what hypothetical market participants would use to determine a transaction price for the asset or liability at the reporting date. The following table presents information about the Company’s assets and liabilities that were measured at fair value on a recurring basis as of June 30, 2020 and December 31, 2019, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. June 30, Quoted Prices in Significant Other Significant Assets: Derivative contracts (Note 14) $ 5,397 $ — $ 5,397 $ — Restoration plan assets 3,710 3,710 — — Total $ 9,107 $ 3,710 $ 5,397 $ — Liabilities: Derivative contracts (Note 14) $ 4,850 $ — $ 4,850 $ — December 31, Quoted Prices in Significant Other Significant Assets: Derivative contracts (Note 14) $ 3,928 $ — $ 3,928 $ — Restoration plan assets 4,199 4,199 — — Total $ 8,127 $ 4,199 $ 3,928 $ — Liabilities: Derivative contracts (Note 14) $ 12,415 $ — $ 12,415 $ — Restoration plan assets The fair values of the Company’s restoration plan assets are determined through quoted prices in active markets. Restoration plan assets are assets held in a Rabbi trust to fund the obligations of the Company’s defined benefit supplementary retirement plans and include various stock and fixed income mutual funds. See Note 16 to these condensed consolidated financial statements regarding defined supplementary retirement plans. The Company’s restoration plan assets are included in other long-term assets on its condensed consolidated balance sheets. Gains and losses related to these investments are included in other expense, net in the Company’s condensed consolidated statements of income. Unrealized gains and losses associated with the underlying stock and fixed income mutual funds were immaterial as of June 30, 2020 and December 31, 2019, respectively. Derivative contracts Derivative assets and liabilities can be exchange-traded or traded over-the-counter (“OTC”). The Company generally values exchange-traded derivatives using models that calibrate to market transactions and eliminate timing differences between the closing price of the exchange-traded derivatives and their underlying instruments. OTC derivatives are valued using market transactions and other market evidence whenever possible, including market-based inputs to models, model calibration to market transactions, broker or dealer quotations or alternative pricing sources with reasonable levels of price transparency. When models are used, the selection of a particular model to value an OTC derivative depends on the contractual terms of, and specific risks inherent in, the instrument as well as the availability of pricing information in the market. The Company generally uses similar models to value similar instruments. Valuation models require a variety of inputs, including contractual terms, market prices and rates, forward curves, measures of volatility, and correlations of such inputs. For OTC derivatives that trade in liquid markets, such as forward contracts, swaps and options, model inputs can generally be corroborated by observable market data by correlation or other means, and model selection does not involve significant management judgment. The Company has interest rate caps, natural gas swaps and cross-currency swaps that are fair valued using Level 2 inputs. In addition, the Company applies a credit valuation adjustment to reflect credit risk which is calculated based on credit default swaps. To the extent that the Company’s net exposure under a specific master agreement is an asset, the Company utilizes the counterparty’s default swap rate. If the net exposure under a specific master agreement is a liability, the Company utilizes a default swap rate comparable to PQ Group Holdings. The credit valuation adjustment is added to the discounted fair value to reflect the exit price that a market participant would be willing to receive to assume the Company’s liabilities or that a market participant would be willing to pay for the Company’s assets. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income | 5. Stockholders' Equity: Accumulated Other Comprehensive Income The following tables present the tax effects of each component of other comprehensive income for the three and six months ended June 30, 2020 and 2019: Three months ended June 30, 2020 2019 Pre-tax Tax benefit/ After-tax amount Pre-tax Tax benefit/ After-tax amount Defined benefit and other postretirement plans: Amortization of net gains and (losses) $ 21 $ (8) $ 13 $ (8) $ 2 $ (6) Amortization of prior service cost (40) 14 (26) (33) 8 (25) Benefit plans, net (19) 6 (13) (41) 10 (31) Net (loss) gain from hedging activities 660 (165) 495 (1,556) 389 (1,167) Foreign currency translation (1) 13,153 (1,214) 11,939 5,469 616 6,085 Other comprehensive income (loss) $ 13,794 $ (1,373) $ 12,421 $ 3,872 $ 1,015 $ 4,887 Six months ended June 30, 2020 2019 Pre-tax Tax benefit/ After-tax amount Pre-tax Tax benefit/ After-tax amount Defined benefit and other postretirement plans: Amortization of net gains and (losses) $ 65 $ (16) $ 49 $ (16) $ 4 $ (12) Amortization of prior service cost (104) 27 (77) (65) 16 (49) Benefit plans, net (39) 11 (28) (81) 20 (61) Net (loss) gain from hedging activities (45) 11 (34) (3,625) 906 (2,719) Foreign currency translation (1) (36,904) 2,488 (34,416) 14,751 (1,499) 13,252 Other comprehensive income (loss) $ (36,988) $ 2,510 $ (34,478) $ 11,045 $ (573) $ 10,472 (1) The income tax benefit or expense included in other comprehensive income is attributed to the portion of foreign currency translation associated with the Company’s cross-currency interest rate swaps, for which the tax effect is based on the applicable U.S. deferred income tax rate. See Note 14 to these condensed consolidated financial statements for information regarding the Company’s cross-currency interest rate swaps. The following table presents the changes in accumulated other comprehensive income (loss), net of tax, by component for the six months ended June 30, 2020 and 2019: Defined benefit Net gain (loss) Foreign Total December 31, 2019 $ 3,568 $ (1,838) $ (17,078) $ (15,348) Other comprehensive loss before reclassifications (1) (1,091) (31,304) (32,396) Amounts reclassified from accumulated other comprehensive income (1) (27) 1,057 — 1,030 June 30, 2020 $ 3,540 $ (1,872) $ (48,382) $ (46,714) December 31, 2018 $ (546) $ 637 $ (39,195) $ (39,104) Other comprehensive income (loss) before reclassifications 2 (2,861) 12,797 9,938 Amounts reclassified from accumulated other comprehensive income (1) (63) 142 — 79 Net current period other comprehensive income (loss) (61) (2,719) 12,797 10,017 Tax Cuts and Jobs Act, reclassification from AOCI to retained earnings 1,684 190 — 1,874 June 30, 2019 $ 1,077 $ (1,892) $ (26,398) $ (27,213) (1) See the following table for details about these reclassifications. Amounts in parentheses indicate debits. The following table presents the reclassifications out of accumulated other comprehensive income for the three and six months ended June 30, 2020 and 2019: Details about Accumulated Other Comprehensive Amounts Reclassified from Accumulated Other Comprehensive Income (1) Affected Line Item where Three months ended Six months ended 2020 2019 2020 2019 Amortization of defined benefit and other postretirement items: Prior service credit (cost) $ 58 $ 33 $ 104 $ 65 Other income (expense) (2) Actuarial gains (losses) (34) 9 (68) 18 Other income (expense) (2) 24 42 36 83 Total before tax (4) (10) (9) (20) Tax expense $ 20 $ 32 $ 27 $ 63 Net of tax Gains and losses on cash flow hedges: Interest rate caps $ (398) $ (169) $ (629) $ (292) Interest expense Natural gas swaps (402) (87) (775) 104 Cost of goods sold (800) (256) (1,404) (188) Total before tax 198 63 347 46 Tax benefit $ (602) $ (193) $ (1,057) $ (142) Net of tax Total reclassifications for the period $ (582) $ (161) $ (1,030) $ (79) Net of tax (1) Amounts in parentheses indicate debits to profit/loss. (2) These accumulated other comprehensive income (loss) components are components of net periodic pension and other postretirement cost (see Note 16 to these condensed consolidated financial statements for additional details). Stock Repurchase Program The Company records repurchases of its common stock for treasury at cost. Upon the reissuance of the Company’s common stock from treasury, differences between the proceeds from reissuance and the average cost of the treasury stock are credited or charged to capital in excess of par value to the extent of prior credits related to the reissuance of treasury stock. If no such credits exist, the differences are charged to retained earnings. On March 12, 2020, the Company announced plans to purchase up to $50,000 of PQ Group Holdings Inc. common stock under a stock repurchase program approved by the Company’s Board of Directors. The Company may repurchase shares from time to time for cash in open market transactions or in privately negotiated transactions in accordance with applicable federal securities laws. The Company will determine the timing and the amount of any repurchases based on its evaluation of market conditions, share price and other factors. The stock repurchase program is valid until March 2022. From the announcement date of the program through June 30, 2020, the Company repurchased 211,700 shares on the open market at an average price of $9.73 for a total of $2,059, none of which repurchases were made during the three months ended June 30, 2020. As of June 30, 2020, $47,941 was available for additional share repurchases under the program. |
Asset Swap Transaction
Asset Swap Transaction | 6 Months Ended |
Jun. 30, 2020 | |
Business Combinations [Abstract] | |
Asset Swap Transaction | 6. Asset Swap Transaction: On February 19, 2020, the Company entered into a long-term agreement with a leading global thermoplastic producer to supply glass beads, and to meet that supply, exchanged inventory and production equipment related to the Company’s ThermoDrop® product line for inventory, production equipment and two glass bead manufacturing facilities (the “beads business”) of the thermoplastic producer (the “asset swap”) in a non-cash transaction. The acquisition of the beads business qualified for recognition as a business combination, which has been recorded using the acquisition method of accounting. Under the acquisition method, the purchase price is allocated to the identifiable net assets acquired based on the fair value as of the acquisition date. The excess of the purchase price over the fair value of the identifiable net assets acquired is recorded to goodwill. The fair value of the assets exchanged related to the Company’s ThermoDrop® product line represents the purchase price consideration for the beads bu siness. Based on the fair value of the assets disposed, the Company recognized a pre-tax loss on disposal of $6,475 during the six months ended June 30, 2020, which is included in other operating expense, net in the Company’s condensed consolidated statement of income. The following table sets forth the calculation and allocation of the consideration given and the identifiable net assets acquired with respect to the asset swap, which was complete as of June 30, 2020. Provisional Purchase Price Allocation Adjustments Purchase Price Total consideration $ 25,166 $ 3,432 $ 28,598 Recognized amounts of identifiable assets acquired and liabilities assumed: Inventories $ 9,912 $ 127 $ 10,039 Property, plant and equipment 9,490 1,339 10,829 Right-of-use lease assets 378 — 378 Fair value of assets acquired 19,780 1,466 21,246 Operating lease liabilities, current (203) — (203) Operating lease liabilities, non-current (175) — (175) (378) — (378) Fair value of net assets acquired 19,402 1,466 20,868 Goodwill 5,764 1,966 7,730 $ 25,166 $ 3,432 $ 28,598 The Company believes that the asset swap will expand its geographic footprint, enabling it to better serve its current and future customers. Combined with anticipated synergies within its existing business, this contributed to a total purchase price that resulted in the recognition of goodwill. All of the goodwill was assigned to the Company’s Performance Materials segment. The goodwill associated with the asset swap is still under evaluation for tax purposes. Results of the beads business since the date of the asset swap are included in the Company’s condensed consolidated statements of income and were not material for disclosure. Amounts that would have been recognized in the Company’s condensed consolidated statements of income during the three months ended March 31, 2020 had the adjustments to the provisional amounts been recognized as of the date of the asset swap were not material. Transaction costs associated with the asset swap were not material for the three and six months ended June 30, 2020. |
Sale of Product Line
Sale of Product Line | 6 Months Ended |
Jun. 30, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Sale of product line | 7. Sale of Product Line: On June 28, 2019, the Company completed the sale of a portion of its sulfate salts product line within its Performance Chemicals segment for $28,000, subject to a working capital adjustment, and recorded a pre-tax gain on sale of $11,362. The transaction was recorded as an asset sale, with the gain on disposition included in the other operating expense, net line item in the Company’s condensed consolidated statement of income for the three and six months ended June 30, 2019 (see Note 9 to these condensed consolidated financial statements for additional details). At the time of disposition, the carrying value of the Company’s net working capital related to this non-core product line was $4,215. In addition to the net working capital sold as part of the transaction, the Company also derecognized $3,423 of property, plant and equipment related to the product line and allocated $9,000 of the consideration received to a liability for deferred revenue. Concurrent with the product line sale, the Company entered into a tolling arrangement with the buyer in which the Company agreed to use its existing sulfate salt manufacturing facilities to manufacture the product for the buyer, the majority of which runs until June 2021. The Company deferred $9,000 of the $28,000 consideration received as a liability, to be recognized as the Company executes its performance obligations over the term of the contractual agreement with the buyer. Additionally, the Company concluded that an embedded lease arrangement exists as a result of the combination of the sale and tolling agreements. Given the ability of the buyer to control substantially all of the output of the facilities and the existence of bargain purchase options on the manufacturing assets, the Company determined that the buyer is effectively leasing the assets from the Company and derecognized the associated property, plant and equipment under a sales-type leasing arrangement. The gain on the sale of fixed assets is included as part of the Company’s overall gain on sale related to the transaction, with the Company’s net investment in the leased assets having been settled as part of the consideration received in the transaction with no additional future cash flows to be recognized on the lease. |
Goodwill
Goodwill | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | 8. Goodwill: The change in the carrying amount of goodwill for the six months ended June 30, 2020 is summarized as follows: Refining Services Catalysts Performance Materials Performance Chemicals Total Balance as of December 31, 2019 $ 311,892 $ 78,611 $ 275,919 $ 593,383 $ 1,259,805 Goodwill recognized — — 7,730 — 7,730 Foreign exchange impact — (1,677) (922) (9,938) (12,537) Balance as of June 30, 2020 $ 311,892 $ 76,934 $ 282,727 $ 583,445 $ 1,254,998 |
Other Operating Expense, Net
Other Operating Expense, Net | 6 Months Ended |
Jun. 30, 2020 | |
Other Income and Expenses [Abstract] | |
Other Operating Expense, Net | 9. Other Operating Expense, Net: A summary of other operating expense, net is as follows: Three months ended Six months ended 2020 2019 2020 2019 Amortization expense $ 8,550 $ 8,636 $ 17,187 $ 17,300 Transaction and other related costs 775 943 2,644 1,008 Restructuring and other related costs 3,051 80 5,040 111 Net (gain) loss on asset disposals (1) (1,020) (9,659) 8,401 (8,839) Environmental related costs 537 848 546 1,327 Other, net 842 971 859 1,651 $ 12,735 $ 1,819 $ 34,677 $ 12,558 (1) During the six months ended June 30, 2020, the Company completed the purchase price allocation related to the asset swap. In doing so, the Company reduced its provisional loss on disposal of $9,907 (which was recorded during the three month period ended March 31, 2020) to a loss of $6,475, which is reflected in net (gain) loss on asset disposals during the six months ended June 30, 2020. The $3,432 reduction to the loss on the asset swap is reflected in net (gain) loss on asset disposals during the three months ended June 30, 2020. Refer to Note 6 to these condensed consolidated financial statements for details on the asset swap. During the three and six months ended June 30, 2019, the Company recognized a gain of $11,362 related to the sale of a product line. Refer to Note 7 of these condensed consolidated financial statements for additional details. |
Inventories, Net
Inventories, Net | 6 Months Ended |
Jun. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories, Net | 10. Inventories, Net: Inventories, net, are classified and valued as follows: June 30, December 31, Finished products and work in process $ 219,731 $ 222,940 Raw materials 46,889 58,005 $ 266,620 $ 280,945 Valued at lower of cost or market: LIFO basis $ 154,571 $ 168,935 Valued at lower of cost and net realizable value: FIFO or average cost basis 112,049 112,010 $ 266,620 $ 280,945 |
Investments in Affiliated Compa
Investments in Affiliated Companies | 6 Months Ended |
Jun. 30, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in Affiliated Companies | 11. Investments in Affiliated Companies: The Company accounts for investments in affiliated companies under the equity method. Affiliated companies accounted for on the equity basis as of June 30, 2020 are as follows: Company Country Percent PQ Silicates Ltd. Taiwan 50% Zeolyst International USA 50% Zeolyst C.V. Netherlands 50% Asociacion para el Estudio de las Tecnologias de Equipamiento de Carreteras, S.A. (“Aetec”) Spain 20% Following is summarized information of the combined investments (1) : Three months ended Six months ended 2020 2019 2020 2019 Sales $ 88,161 $ 89,938 $ 159,368 $ 158,032 Gross profit 34,470 35,137 65,609 54,551 Operating income 24,688 27,052 45,697 36,259 Net income 26,333 27,910 46,368 37,150 (1) Summarized information of the combined investments is presented at 100%; the Company’s share of the net assets and net income of affiliates is calculated based on the percent ownership specified in the table above. In March 2020, the Company sold its 49% interest in the Quaker Holdings joint venture to a third party. Prior to the Company’s disposition of its shares in the joint venture, the Company received a liquidating dividend of $729 as well as $1,032 for the sale of the joint venture shares, which was included in the proceeds from sale of investment within the investing activities section of the Company’s consolidated statement of cash flows. |
Property, Plant and Equipment
Property, Plant and Equipment | 6 Months Ended |
Jun. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | 12. Property, Plant and Equipment: A summary of property, plant and equipment, at cost, and related accumulated depreciation is as follows: June 30, December 31, Land $ 175,532 $ 183,117 Buildings 223,416 221,449 Machinery and equipment 1,241,387 1,236,531 Construction in progress 81,749 82,687 1,722,084 1,723,784 Less: accumulated depreciation (589,419) (537,014) $ 1,132,665 $ 1,186,770 Depreciation expense was $33,243 and $32,381 for the three months ended June 30, 2020 and 2019, respectively. Depreciation expense was $66,744 and $65,535 for the six months ended June 30, 2020 and 2019, respectively. |
Long-term Debt
Long-term Debt | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Long-term Debt | 13. Long-term Debt: The summary of long-term debt is as follows: June 30, December 31, Term Loan Facility $ 947,497 $ 947,497 6.75% Senior Secured Notes due 2022 625,000 625,000 5.75% Senior Unsecured Notes due 2025 295,000 295,000 ABL Facility — — Other 65,484 64,629 Total debt 1,932,981 1,932,126 Original issue discount (14,448) (13,434) Deferred financing costs (10,988) (11,730) Total debt, net of original issue discount and deferred financing costs 1,907,545 1,906,962 Less: current portion (8,602) (7,766) Total long-term debt, excluding current portion $ 1,898,943 $ 1,899,196 The fair value of a financial instrument is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. As of June 30, 2020 and December 31, 2019, the fair value of the term loan facility and senior secured and unsecured notes was $1,841,160 and $1,905,822, respectively. The fair value is classified as Level 2 based upon the fair value hierarchy (see Note 4 to these condensed consolidated financial statements for further information on fair value measurements). In July 2020, the Company entered into an agreement for a new senior secured term loan facility in an aggregate principal amount of $650,000 with an original issue discount of 1.5% and interest at a floating rate of LIBOR (with a 1.0% minimum LIBOR floor) plus 3.0% per annum. The proceeds were used to redeem its existing $625,000 of 6.75% Senior Secured Notes due 2022 and pay the associated early redemption premiums. |
Financial Instruments
Financial Instruments | 6 Months Ended |
Jun. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments | 14. Financial Instruments: The Company uses (1) interest rate related derivative instruments to manage its exposure to changes in interest rates on its variable-rate debt instruments, (2) commodity derivatives to manage its exposure to commodity price fluctuations, and (3) foreign currency related derivative instruments to manage its foreign currency exposure to its net investments in certain foreign operations. The Company does not speculate using derivative instruments. By using derivative financial instruments to hedge exposures to changes in interest rates, commodity prices and foreign currency, the Company exposes itself to credit risk and market risk. Credit risk is the failure of the counterparty to perform under the terms of the derivative contract. When the fair value of a derivative contract is an asset, the counterparty owes the Company, which creates credit risk for the Company. When the fair value of a derivative contract is a liability, the Company owes the counterparty and therefore, the Company is not exposed to the counterparty’s credit risk in those circumstances. The Company minimizes counterparty credit risk in derivative instruments by entering into transactions with high quality counterparties. The derivative instruments entered into by the Company do not contain credit-risk-related contingent features. Market risk is the adverse effect on the value of a derivative instrument that results from a change in interest rates, currency exchange rates or commodity prices. The market risk associated with the Company’s derivative instruments is managed by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken. Use of Derivative Financial Instruments to Manage Commodity Price Risk. The Company is exposed to risks in energy costs due to fluctuations in energy prices, particularly natural gas. The Company has a hedging program in the United States which allows the Company to mitigate exposure to natural gas volatility with natural gas swap agreements. Fair value is determined based on estimated amounts that would be received or paid to terminate the contracts at the reporting date based on quoted market prices of comparable contracts. The respective current and non-current liabilities are recorded in accrued liabilities and other long-term liabilities and the respective current and non-current assets are recorded in prepaid and other current assets and other long-term assets, as applicable, in the Company’s consolidated balance sheet. As the derivatives are designated and qualify as cash flow hedges, the gains or losses on the natural gas swaps are recorded in stockholders’ equity as a component of other comprehensive income (loss) (“OCI”), net of tax. Reclassifications of the gains and losses on natural gas hedges into earnings are recorded in production costs and subsequently charged to cost of goods sold in the condensed consolidated statements of income in the period in which the associated inventory is sold. As of June 30, 2020, the Company’s natural gas swaps had a remaining notional quantity of 2.5 million MMBTU to mitigate commodity price volatility through December 2021. Use of Derivative Financial Instruments to Manage Interest Rate Risk. The Company is exposed to fluctuations in interest rates on its senior secured credit facilities. Changes in interest rates will not affect the market value of such debt but will affect the Company’s interest payments over the term of the loans. Likewise, an increase in interest rates could have a material impact on the Company’s cash flow. The Company hedges the interest rate fluctuations on debt obligations through interest rate cap agreements. The Company records these agreements at fair value as assets or liabilities in its consolidated balance sheet. As the derivatives are designated and qualify as cash flow hedges, the gains or losses on the interest rate cap agreements are recorded in stockholders’ equity as a component of OCI, net of tax. Reclassifications of the gains and losses on the interest rate cap agreements into earnings are recorded as part of interest expense in the condensed consolidated statements of income as the Company makes its interest payments on the hedged portion of its senior secured credit facilities. Fair value is determined based on estimated amounts that would be received or paid to terminate the contracts at the reporting date based on quoted market prices. In July 2016, the Company entered into interest rate cap agreements, paying a premium of $1,551 to mitigate interest rate volatility from July 2016 through July 2020 by employing varying cap rates, ranging from 1.50% to 3.00%, on $1,000,000 of notional variable-rate debt. In November 2018, the Company entered into additional interest rate cap agreements to mitigate interest volatility from July 2020 through July 2022, with a cap rate of 3.50% on $500,000 of notional variable-rate debt and a $3,380 premium annuitized during the effective period. In February 2020, the Company restructured its $500,000 of notional variable-rate debt interest rate cap agreements from July 2020 through July 2022, to lower the interest cap rate to 2.50% with an incremental $130 premium annuitized during the effective period. In March 2020, the Company again amended such interest rate cap agreements to lower the cap rate to 0.84% from 2.50% on $500,000 of notional variable-rate debt and paid an additional incremental $900 premium annuitized during the effective period. The term remains unchanged from July 2020 through July 2022. The total cumulative annuitized premium on the $500,000 of notional variable-rate debt is $4,410. The cap rate in effect at June 30, 2020 is 3.00%. In July 2020, the Company entered into additional interest rate cap agreements to mitigate interest rate volatility from August 2020 to August 2023, with a cap rate of 1.00% on $400,000 of notional variable-rate debt. Use of Derivative Financial Instruments to Manage Foreign Currency Risk. The Company is exposed to risks related to its net investments in foreign operations due to fluctuations in foreign currency exchange rates, particularly between the United States dollar and the Euro. In February 2018, the Company entered into multiple cross-currency interest rate swap arrangements with an aggregate notional amount of €280,000 ($314,818 as of June 30, 2020) to hedge this exposure on the net investments of certain of its Euro-denominated subsidiaries. The Company records these swap agreements at fair value as assets or liabilities in its consolidated balance sheet. As the derivatives are designated and qualify as net investment hedges, changes in the fair value of the swaps attributable to changes in the spot exchange rates are recognized in cumulative translation adjustment (“CTA”) within OCI and are held there until the hedged net investments are sold or substantially liquidated. Upon such sale or liquidation, the amount recognized in CTA is reclassified to earnings and reported in the same line item as the gain or loss on the liquidation of the net investments. Changes in the fair value of the swaps attributable to the cross-currency basis spread are excluded from the assessment of hedge effectiveness and are recorded in current period earnings. The fair values of derivative instruments held as of June 30, 2020 and December 31, 2019 are shown below: Balance sheet location June 30, December 31, Derivative assets: Derivatives designed as net investment hedges: Cross-currency interest rate swaps Prepaid and other current assets 3,992 3,928 Cross-currency interest rate swaps Other long-term assets 1,405 — Total derivative assets $ 5,397 $ 3,928 Derivative liabilities: Derivatives designated as cash flow hedges: Natural gas swaps Accrued liabilities $ 688 $ 813 Interest rate caps Accrued liabilities 1,636 420 Natural gas swaps Other long-term liabilities 1 226 Interest rate caps Other long-term liabilities 2,525 2,822 4,850 4,281 Derivatives designated as net investment hedges: Cross-currency swaps Other long-term liabilities — 8,134 Total derivative liabilities $ 4,850 $ 12,415 The following tables show the effect of the Company’s derivative instruments designated as cash flow hedges on AOCI for the three and six months ended June 30, 2020 and 2019: Three months ended June 30, 2020 2019 Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income Interest rate caps Interest (expense) income $ (325) $ (293) $ (675) $ (169) Natural gas swaps Cost of goods sold 198 (494) (1,137) (87) $ (127) $ (787) $ (1,812) $ (256) Six months ended June 30, 2020 2019 Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income Interest rate caps Interest (expense) income $ (920) $ (524) $ (3,048) $ (292) Natural gas swaps Cost of goods sold (517) (867) (766) 104 $ (1,437) $ (1,391) $ (3,814) $ (188) The following tables show the effect of the Company’s cash flow hedge accounting on the condensed consolidated statements of income for the three and six months ended June 30, 2020 and 2019: Location and amount of gain (loss) recognized in income on cash flow hedging relationships Three months ended June 30, 2020 2019 Cost of goods sold Interest (expense) Cost of goods sold Interest (expense) Total amounts of income and expense line items presented in the statement of income in which the effects of cash flow hedges are recorded $ (266,686) $ (22,275) $ (316,180) $ (28,540) The effects of cash flow hedging: Gain (loss) on cash flow hedging relationships: Interest contracts: Amount of gain (loss) reclassified from AOCI into income — (293) — (169) Commodity contracts: Amount of gain (loss) reclassified from AOCI into income (494) — (87) — Location and amount of gain (loss) recognized in income on cash flow hedging relationships Six months ended June 30, 2020 2019 Cost of goods sold Interest (expense) Cost of goods sold Interest (expense) Total amounts of income and expense line items presented in the statement of income in which the effects of cash flow hedges are recorded (539,685) (46,730) (594,491) (57,158) The effects of cash flow hedging: Gain (loss) on cash flow hedging relationships: Interest contracts: Amount of gain (loss) reclassified from AOCI into income — (524) — (292) Commodity contracts: Amount of gain (loss) reclassified from AOCI into income (867) — 104 — The amount of unrealized losses in AOCI related to the Company’s cash flow hedges that is expected to be reclassified to the condensed consolidated statement of income over the next twelve months is $688 as of June 30, 2020. The following tables show the effect of the Company’s net investment hedges on AOCI and the condensed consolidated statements of income for the three and six months ended June 30, 2020 and 2019: Amount of gain (loss) recognized in OCI on derivative Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) reclassified from AOCI into income Location of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Amount of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Three months ended Three months ended Three months ended 2020 2019 2020 2019 2020 2019 Cross-currency interest rate swaps $ (5,206) $ (2,613) Gain (loss) on sale of subsidiary $ — $ — Interest (expense) income $ 1,552 $ 2,465 Amount of gain (loss) recognized in OCI on derivative Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) reclassified from AOCI into income Location of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Amount of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Six months ended Six months ended Six months ended 2020 2019 2020 2019 2020 2019 Cross-currency interest rate swaps $ 9,603 $ 5,940 Gain (loss) on sale of subsidiary $ — $ — Interest (expense) income $ 3,244 $ 3,912 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 15. Income Taxes: The effective income tax rate for the three months ended June 30, 2020 was 50.0% compared to 39.8% for the three months ended June 30, 2019. The effective income tax rate for the six months ended June 30, 2020 was 51.4% compared to 40.0% for the six months ended June 30, 2019. The Company’s effective income tax rate has fluctuated primarily due changes in income mix (including the effect of loss companies), the impacts of the Global Intangible Low Taxed Income (“GILTI”) tax rules and changes in foreign exchange gains and losses, which create permanent differences in certain jurisdictions. The difference between the U.S. federal statutory income tax rate and the Company’s effective income tax rate for the six months ended June 30, 2020 was mainly due to the impacts of GILTI, the discrete tax impacts of the Company entering into an asset swap agreement, pre-tax losses with no associated tax benefit and state taxes. The difference between the U.S. federal statutory income tax rate and the Company’s effective income tax rate for the six months ended June 30, 2019 was mainly due to the tax effect of permanent differences related to foreign currency exchange gain or loss, the impacts of GILTI , pre-tax losses with no associated tax benefit, prior year tax refunds not previously accrued for and state taxes. |
Benefit Plans
Benefit Plans | 6 Months Ended |
Jun. 30, 2020 | |
Retirement Benefits [Abstract] | |
Benefit Plans | 16. Benefit Plans: The following information is provided for (1) the Company-sponsored defined benefit pension plans covering employees in the U.S. and certain employees at its foreign subsidiaries, (2) the Company-sponsored unfunded plans to provide certain health care benefits to retired employees in the U.S. and Canada, and (3) the Company’s defined benefit supplementary retirement plans which provide benefits for certain U.S. employees in excess of qualified plan limitations. Components of net periodic expense (benefit) are as follows: Defined Benefit Pension Plans U.S. Foreign Three months ended Three months ended 2020 2019 2020 2019 Service cost $ 192 $ 281 $ 997 $ 878 Interest cost 2,152 2,798 707 824 Expected return on plan assets (3,331) (3,064) (810) (990) Amortization of net loss — — 41 — Amortization of prior service cost — — 6 12 Net periodic expense (benefit) $ (987) $ 15 $ 941 $ 724 U.S. Foreign Six months ended Six months ended 2020 2019 2020 2019 Service cost $ 384 $ 500 $ 1,994 $ 1,684 Interest cost 4,304 5,305 1,414 1,657 Expected return on plan assets (6,662) (5,821) (1,620) (1,593) Amortization of net loss — — 82 — Amortization of prior service cost — — 12 12 Net periodic expense (benefit) $ (1,974) $ (16) $ 1,882 $ 1,760 Supplemental Retirement Plans Three months ended Six months ended 2020 2019 2020 2019 Interest cost $ 86 $ 122 $ 172 $ 243 Net periodic expense $ 86 $ 122 $ 172 $ 243 Other Postretirement Benefit Plans Three months ended Six months ended 2020 2019 2020 2019 Service cost $ — $ 4 $ — $ 7 Interest cost 24 38 48 76 Amortization of prior service credit (58) (33) (116) (65) Amortization of net gain (7) (9) (14) (18) Net periodic expense (benefit) $ (41) $ — $ (82) $ — |
Commitments and Contingent Liab
Commitments and Contingent Liabilities | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingent Liabilities | 17. Commitments and Contingent Liabilities: There is a risk of environmental impact in chemical manufacturing operations. The Company’s environmental policies and practices are designed to comply with existing laws and regulations and to minimize the possibility of significant environmental impact. The Company is also subject to various other lawsuits and claims with respect to matters such as governmental regulations, labor and other actions arising out of the normal course of business. While management believes that the liabilities resulting from such lawsuits and claims are not probable or reasonably estimable, certain accruals have been reflected in the Company’s condensed consolidated financial statements. When these matters are ultimately concluded and determined, the Company believes that there will be no material adverse effect on its consolidated financial position, results of operations or liquidity. |
Reportable Segments
Reportable Segments | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Reportable Segments | 18. Reportable Segments: Summarized financial information for the Company’s reportable segments is shown in the following table: Three months ended Six months ended 2020 2019 2020 2019 Sales: Refining Services $ 90,432 $ 117,290 $ 191,123 $ 223,134 Catalysts (1) 25,208 20,857 50,072 36,723 Performance Materials 104,203 118,872 169,772 179,961 Performance Chemicals 142,641 177,828 316,920 358,290 Eliminations (2) (2,959) (3,172) (6,764) (7,212) Total $ 359,525 $ 431,675 $ 721,123 $ 790,896 Segment Adjusted EBITDA: (3) Refining Services $ 34,996 $ 42,824 $ 72,179 $ 82,555 Catalysts (4) 25,312 29,607 47,979 47,734 Performance Materials 27,306 29,221 40,813 39,736 Performance Chemicals 34,011 41,165 74,485 83,838 Total Segment Adjusted EBITDA (5) $ 121,625 $ 142,817 $ 235,456 $ 253,863 (1) Excludes the Company’s proportionate share of sales from the Zeolyst International and Zeolyst C.V. joint ventures (collectively, the “Zeolyst Joint Venture”) accounted for using the equity method (see Note 11 to these condensed consolidated financial statements for further information). The proportionate share of sales is $40,852 and $39,124 for the three months ended June 30, 2020 and 2019, respectively. The proportionate share of sales is $73,143 and $68,602 for the six months ended June 30, 2020 and 2019, respectively. (2) The Company eliminates intersegment sales when reconciling to the Company’s condensed consolidated statements of income. (3) The Company defines Adjusted EBITDA as EBITDA adjusted for certain items as noted in the reconciliation below. Management evaluates the performance of its segments and allocates resources based on several factors, of which the primary measure is Adjusted EBITDA. Adjusted EBITDA should not be considered as an alternative to net income as an indicator of the Company’s operating performance. Adjusted EBITDA as defined by the Company may not be comparable with EBITDA or Adjusted EBITDA as defined by other companies. (4) The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalysts segment is $16,855 for the three months ended June 30, 2020, which includes $11,489 of equity in net income plus $1,659 of amortization of investment in affiliate step-up and $3,707 of joint venture depreciation, amortization and interest. The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalysts segment is $17,636 for the three months ended June 30, 2019, which includes $12,264 of equity in net income plus $1,659 of amortization of investment in affiliate step-up and $3,713 of joint venture depreciation, amortization and interest. The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalysts segment is $30,580 for the six months ended June 30, 2020, which includes $19,806 of equity in net income plus $3,317 of amortization of investment in affiliate step-up and $7,457 of joint venture depreciation, amortization and interest. The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalysts segment is $25,993 for the six months ended June 30, 2019, which includes $14,300 of equity in net income plus $4,217 of amortization of investment in affiliate step-up and $7,476 of joint venture depreciation, amortization and interest. (5) Total Segment Adjusted EBITDA differs from the Company’s consolidated Adjusted EBITDA due to unallocated corporate expenses. A reconciliation of net income attributable to PQ Group Holdings to Segment Adjusted EBITDA is as follows: Three months ended Six months ended 2020 2019 2020 2019 Reconciliation of net income attributable to PQ Group Holdings Inc. to Segment Adjusted EBITDA Net income attributable to PQ Group Holdings Inc. $ 15,926 $ 30,574 $ 16,150 $ 33,725 Provision for income taxes 16,262 20,307 17,689 22,754 Interest expense, net 22,275 28,540 46,730 57,158 Depreciation and amortization 44,822 45,090 90,493 90,984 Segment EBITDA 99,285 124,511 171,062 204,621 Joint venture depreciation, amortization and interest 3,708 3,713 7,457 7,476 Amortization of investment in affiliate step-up 1,659 1,659 3,317 4,217 Debt extinguishment costs — — 2,513 — Net (gain) loss on asset disposals (1,020) (9,653) 8,401 (8,833) Foreign currency exchange (gain) loss (854) 3,612 2,483 923 LIFO expense (1,469) 122 (1,798) 10,280 Transaction and other related costs 739 975 2,801 1,055 Equity-based compensation 6,366 5,370 12,286 8,770 Restructuring, integration and business optimization expenses 3,591 (13) 5,620 719 Defined benefit pension plan (benefit) cost (252) 552 (500) 1,545 Other 1,284 1,605 2,538 2,721 Adjusted EBITDA 113,037 132,453 216,180 233,494 Unallocated corporate expenses 8,588 10,364 19,276 20,369 Segment Adjusted EBITDA $ 121,625 $ 142,817 $ 235,456 $ 253,863 |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2020 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | 19. Stock-Based Compensation: The Company is authorized to issue shares for common stock awards to employees, directors and affiliates of the Company in connection with the PQ Group Holdings Inc. 2017 Omnibus Incentive Plan, as Amended and Restated (the “2017 Plan”). During the six months ended June 30, 2020, the Company granted 1,158,605 restricted stock units and 456,311 performance stock units (at target) under the 2017 Plan as part of its equity incentive compensation program. Each restricted stock unit provides the recipient with the right to receive a share of common stock subject to graded vesting terms based on service, which for the awards granted during the six months ended June 30, 2020, requires approximately one year of service for members of the Company’s board of directors and approximately three years of service for employees. The performance stock units granted during the six months ended June 30, 2020 provide the recipients with the right to receive shares of common stock dependent 50% on the achievement of a Company-specific financial performance target and 50% on a total shareholder return (“TSR”) goal, and are generally subject to the provision of service through the vesting date of the award. The Company-specific financial performance target and the TSR goal are measured independently of each other, but achievement of both of the metrics is measured based on the same three-year performance period from January 1, 2020 through December 31, 2022. The TSR goal is based on the Company’s relative TSR performance against the companies included in the Russell 2000 Index over the performance period. Achievement of the Company-specific financial performance target is measured based on the average levels of achievement across the performance period. Depending on the Company’s performance against the predetermined thresholds for achievement, each performance stock unit award recipient is eligible to earn a percentage of the target number of shares granted to the recipient, ranging from zero to 200%. The performance stock units, to the extent earned, will vest on the date the Company’s compensation and governance committee certifies the achievement of the performance metrics for the three-year period ending December 31, 2022, which will occur no later than March 1, 2023. The value of the restricted stock units granted during the six months ended June 30, 2020 was based on the average of the high and low trading prices of the Company’s common stock on the NYSE on the preceding trading day, in accordance with the Company’s policy for valuing such awards. Compensation expense related to the restricted stock units is recognized on a straight-line basis over the respective vesting period. The value of the portion of the performance stock units granted during the six months ended June 30, 2020 eligible to be earned based on the achievement of the Company-specific financial performance target (50% of the award) was measured on the same basis as that of the restricted stock units, and based on the target number of shares granted; because the performance vesting conditions affect the ability of the recipients to vest in the awards, they are not factored into the fair value measure of the award. Compensation expense related to such performance stock units is recognized ratably over the requisite service period, and the Company must assess the probability that the performance conditions will be met each reporting period, and the level at which they are estimated to be attained. Should the probability assessment change during a given reporting period, the total compensation cost (both recognized and unrecognized) will be adjusted to reflect the revised assessment. The TSR goal, which determines how much of the other 50% of the performance stock units granted during the six months ended June 30, 2020 may be earned, is considered a market condition as opposed to a vesting condition. Because a market condition is not considered a vesting condition, it is reflected in the grant date fair value of an award and the associated compensation cost based on the fair value of the award is recognized over the performance period, regardless of whether the Company actually achieves the market condition or the level of achievement, as long as service is provided by the recipient. The Company used a Monte Carlo simulation to estimate the fair value of the portion of the awards subject to the TSR goal. The following table provides the assumptions used to determine the grant date fair value of the market condition-dependent / TSR goal-based portion of the Company’s performance stock units granted during the six months ended June 30, 2020 using a Monte Carlo simulation: Expected dividend yield — % Risk-free interest rate 1.56 % Expected volatility 28.57 % Expected term (in years) 2.95 Grant date fair value $ 24.11 The following table summarizes the activity for the Company’s restricted stock units and performance stock units for the six months ended June 30, 2020: Restricted Stock Units Performance Stock Units Number of Weighted Average Grant Date Fair Value (per share) Number of Weighted Average Grant Date Fair Value (per share) Nonvested as of December 31, 2019 1,628,436 $ 15.83 550,676 $ 15.41 Granted 1,158,605 $ 16.60 456,311 $ 20.38 Vested (441,760) $ 15.43 — $ — Forfeited (99,667) $ 16.30 (31,069) $ 15.41 Nonvested as of June 30, 2020 2,245,614 $ 16.29 975,918 $ 17.74 Total stock-based compensation expense for all of the Company’s equity incentive awards was $6,366 and $5,370 for the three months ended June 30, 2020 and 2019, respectively, and $12,286 and $8,770 for the six months ended June 30, 2020 and 2019, respectively. The income tax benefit recognized in the condensed consolidated statements of incom e was $1,577 and $1,326 for the three months ended June 30, 2020 and 2019, respectively, and $3,044 and $2,166 fo r the six months ended June 30, 2020 and 2019, respectively. With the new grants of restricted stock units and performance stock units during the six months ended June 30, 2020, unrecognized compensation cost at June 30, 2020 related to nonvested awards was $26,601 and $12,314 for restricted stock units and performance stock units, respectively. The weighted-average period over which these costs are expected to be recognized at June 30, 2020 is 1.79 years for the restricted stock units and 2.14 years for the performance stock units. Activity related to the Company’s stock options and restricted stock awards was not material for the six months ended June 30, 2020, other than the forfeiture of 560,381 of restricted stock awards subject to a performance vesting condition based upon the occurrence of a defined liquidity event. No expense had previously been recognized related to these awards, as the performance vesting condition was not achieved nor considered probable of achievement. |
Earnings per Share
Earnings per Share | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per Share | 20. Earnings per Share: Basic earnings per share is calculated as income (loss) available to common stockholders, divided by the weighted average number of common shares outstanding during the period. The weighted average number of common shares outstanding during the period for the computation of basic earnings per share excludes restricted stock awards that have legally been issued but are nonvested during the period, as the sale of these shares is prohibited pending satisfaction of certain vesting conditions by the award recipients in order to earn the rights to the shares. Diluted earnings per share is calculated as income (loss) available to common stockholders, divided by the weighted average number of common and potential common shares outstanding during the period, if dilutive. Potential common shares reflect (1) unvested restricted stock awards and restricted stock units with service vesting conditions, (2) performance stock units with vesting conditions considered probable of achievement and (3) options to purchase common stock, all of which have been included in the diluted earnings per share calculation using the treasury stock method. The reconciliation from basic to diluted weighted average shares outstanding is as follows: Three months ended Six months ended 2020 2019 2020 2019 Weighted average shares outstanding – Basic 135,083,126 134,142,552 135,278,764 134,044,972 Dilutive effect of unvested common shares and restricted stock units with service conditions, performance stock units considered probable of vesting and assumed stock option exercises and conversions 588,704 1,180,472 800,776 1,062,035 Weighted average shares outstanding – Diluted 135,671,830 135,323,024 136,079,540 135,107,007 Basic and diluted earnings per share are calculated as follows: Three months ended Six months ended 2020 2019 2020 2019 Numerator: Net income attributable to PQ Group Holdings Inc. $ 15,926 $ 30,574 $ 16,150 $ 33,725 Denominator: Weighted average shares outstanding – Basic 135,083,126 134,142,552 135,278,764 134,044,972 Weighted average shares outstanding – Diluted 135,671,830 135,323,024 136,079,540 135,107,007 Net income per share: Basic income per share $ 0.12 $ 0.23 $ 0.12 $ 0.25 Diluted income per share $ 0.12 $ 0.23 $ 0.12 $ 0.25 The table below presents the details of the Company’s weighted average equity-based awards outstanding during each respective period that were excluded from the calculation of diluted earnings per share: Three months ended Six months ended 2020 2019 2020 2019 Restricted stock awards with performance only targets not yet achieved 1,507,366 1,637,134 1,511,868 1,638,318 Stock options with performance only targets not yet achieved 509,888 586,253 516,110 586,253 Anti-dilutive restricted stock awards, restricted stock units and performance stock units 2,262,974 — 1,421,401 2,012 Anti-dilutive stock options 844,475 863,063 847,641 863,063 Restricted stock awards and stock options with performance only vesting conditions were not included in the dilution calculation, as the performance targets have not been achieved nor were probable of achievement as of the end of the respective periods. On a weighted average basis, options to purchase 603,159 and 621,747 shares of common stock at $16.97 per share for the three months ended June 30, 2020 and 2019, respectively, and options to purchase 241,316 shares of common stock at $17.50 per share for the three months ended June 30, 2020 and 2019, were excluded from the computation of diluted earnings per share for the respective periods, because the combination of the options’ exercise price and remaining unamortized stock-based compensation expense was greater than the average market price of the common shares. On a weighted average basis, options to purchase 606,325 and 621,747 shares of common stock at $16.97 per share for the six months ended June 30, 2020 and 2019, respectively, and options to purchase 241,316 shares of common stock at $17.50 per share for the six months ended June 30, 2020 and 2019, were excluded from the computation of diluted earnings per share for the respective periods, because the combination of the options’ exercise price and remaining unamortized stock-based compensation expense was greater than the average market price of the common shares. The stock options with an exercise price of $16.97 per share expire on October 2, 2027, while the stock options with an exercise price of $17.50 per share expire on August 9, 2028. Anti-dilutive awards are not included in the dilution calculation, as their inclusion would have the effect of increasing diluted income per share. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 6 Months Ended |
Jun. 30, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | 21. Supplemental Cash Flow Information: The following table presents supplemental cash flow information for the Company: Six months ended 2020 2019 Cash paid during the period for: Income taxes, net of refunds $ 14,436 $ 8,301 Interest (1) 54,248 59,035 Non-cash investing activity (2) : Capital expenditures acquired on account but unpaid as of the period end 6,716 10,405 Right-of-use assets obtained in exchange for new lease liabilities (non-cash) (2) : Operating leases 3,641 1,566 (1) Cash paid for interest is shown net of capitalized interest for the periods presented and excludes $2,197 and $4,478 of net interest proceeds on swaps designated as net investment hedges for the six months ended June 30, 2020 and 2019, respectively, which are included within cash flows from investing activities in the Company’s condensed consolidated statements of cash flows. (2) The Company entered into a non-monetary asset swap arrangement whereby it exchanged certain assets with a third party. Details of the associated non-cash investing activities are further described in Note 6 to these condensed consolidated financial statements. As part of the asset swap transaction, the Company assumed a lease contract that is exclusive of those summarized in the above table. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets as of June 30, 2020 and 2019 to the total of the same amounts shown in the condensed consolidated statements of cash flows for the six months then ended: June 30, 2020 2019 Cash and cash equivalents $ 88,640 $ 82,200 Restricted cash included in prepaid and other current assets 1,948 1,759 Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows $ 90,588 $ 83,959 |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | 22. Subsequent Events: In July 2020, the Company completed the sale of a non-core product line within its Performance Chemicals segment for $18,000. Concurrent with the sale, the Company entered into a tolling arrangement with the buyer through July 2025 in which the Company agreed to use its existing manufacturing facilities for the product line to manufacture the product for the buyer. In July 2020, the Company entered into an agreement for a new senior secured term loan facility and redeemed its 6.75% Senior Secured Notes due 2022. See Note 13 to these condensed consolidated financial statements for details on the new senior secured term loan facility and the redemption of the 6.75% Senior Secured Notes due 2022. In July 2020, the Company entered into $400,000 notional amount of interest rate cap agreements. See Note 14 to these condensed consolidated financial statements for additional details. Other than the sale of the non-core product line, the entry into an agreement for a new senior secured term loan facility, the redemption of the 6.75% Senior Secured Notes due 2022 and the entry into new interest rate cap agreements as set forth above, the Company has evaluated subsequent events since the balance sheet date and determined that there are no additional items to disclose. |
Background and Basis of Prese_2
Background and Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of PresentationThe condensed consolidated financial statements included herein are unaudited. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations for interim reporting. In the opinion of management, all adjustments of a normal and recurring nature necessary to state fairly the financial position and results of operations have been included. The results of operations are not necessarily indicative of the results to be expected for the full year. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. |
Recently Issued Accounting Standards | Recently Adopted Accounting Standards In June 2016, the Financial Accounting Standards Board (“FASB”) issued guidance that affects loans, trade receivables and any other financial assets that have the contractual right to receive cash. Under the new guidance, an entity is required to recognize expected credit losses rather than incurred losses for financial assets. The new guidance is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. The Company adopted the new guidance effective January 1, 2020, with no material impact to the Company’s consolidated financial position, results of operations or cash flows. In August 2018, the FASB issued guidance which modifies certain disclosure requirements over fair value measurements. The guidance is effective for fiscal years beginning after December 15, 2019, including all interim periods within that fiscal year. The Company adopted the new guidance effective January 1, 2020. The Company does not classify any of its derivative contracts as Level 3 assets or liabilities, nor did the Company have any transfers amongst fair value levels during the six months ended June 30, 2020. As such, the guidance did not have an impact on the fair value measurement disclosures included in the Company’s consolidated financial statements. In January 2017, the FASB issued guidance which eliminates the second step from the traditional two-step goodwill impairment test. Under current guidance, an entity performed the first step of the goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount; if an impairment loss was indicated, the entity computed the implied fair value of goodwill to determine whether an impairment loss existed, and if so, the amount to recognize. Under the new guidance, an impairment loss is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value (the Step 1 test), with no further testing required. Any impairment loss recognized is limited to the amount of goodwill allocated to the reporting unit. The new guidance is effective for public companies that are Securities and Exchange Commission (“SEC”) registrants for fiscal years beginning after December 15, 2019, with early adoption permitted for goodwill impairment tests performed on testing dates after January 1, 2017. The Company adopted the new guidance on January 1, 2020, and will apply the guidance prospectively to its goodwill impairment tests. Accounting Standards Not Yet Adopted In December 2019, the FASB issued new guidance to simplify the accounting for income taxes by removing certain exceptions to the general principles and also simplification of areas such as franchise taxes, step-up in tax basis goodwill, separate entity financial statements and interim recognition of enactment of tax laws or rate changes. The new guidance is effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of this new guidance on its consolidated financial statements. In March 2020, the FASB issued guidance to address certain accounting consequences from the anticipated transition from the use of the London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates. The new guidance contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance is optional and may be elected over time as reference rate reform activities occur. During the three months ended June 30, 2020, the Company elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based on matches the index of the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur. |
Fair Value Measurement | Restoration plan assets The fair values of the Company’s restoration plan assets are determined through quoted prices in active markets. Restoration plan assets are assets held in a Rabbi trust to fund the obligations of the Company’s defined benefit supplementary retirement plans and include various stock and fixed income mutual funds. See Note 16 to these condensed consolidated financial statements regarding defined supplementary retirement plans. The Company’s restoration plan assets are included in other long-term assets on its condensed consolidated balance sheets. Gains and losses related to these investments are included in other expense, net in the Company’s condensed consolidated statements of income. Unrealized gains and losses associated with the underlying stock and fixed income mutual funds were immaterial as of June 30, 2020 and December 31, 2019, respectively. Derivative contracts Derivative assets and liabilities can be exchange-traded or traded over-the-counter (“OTC”). The Company generally values exchange-traded derivatives using models that calibrate to market transactions and eliminate timing differences between the closing price of the exchange-traded derivatives and their underlying instruments. OTC derivatives are valued using market transactions and other market evidence whenever possible, including market-based inputs to models, model calibration to market transactions, broker or dealer quotations or alternative pricing sources with reasonable levels of price transparency. When models are used, the selection of a particular model to value an OTC derivative depends on the contractual terms of, and specific risks inherent in, the instrument as well as the availability of pricing information in the market. The Company generally uses similar models to value similar instruments. Valuation models require a variety of inputs, including contractual terms, market prices and rates, forward curves, measures of volatility, and correlations of such inputs. For OTC derivatives that trade in liquid markets, such as forward contracts, swaps and options, model inputs can generally be corroborated by observable market data by correlation or other means, and model selection does not involve significant management judgment. The Company has interest rate caps, natural gas swaps and cross-currency swaps that are fair valued using Level 2 inputs. In addition, the Company applies a credit valuation adjustment to reflect credit risk which is calculated based on credit default swaps. To the extent that the Company’s net exposure under a specific master agreement is an asset, the Company utilizes the counterparty’s default swap rate. If the net exposure under a specific master agreement is a liability, the Company utilizes a default swap rate comparable to PQ Group Holdings. The credit valuation adjustment is added to the discounted fair value to reflect the exit price that a market participant would be willing to receive to assume the Company’s liabilities or that a market participant would be willing to pay for the Company’s assets. |
Revenue from Contracts with C_2
Revenue from Contracts with Customers Revenue from Contracts with Customers (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The Company’s portfolio of products are integrated into a variety of end uses, which are described in the table below. Key End Uses Key Products Industrial & process chemicals • Silicate precursors for the tire industry • Glass beads, or microspheres, for metal finishing end uses Fuels & emission control • Refinery catalysts • Emission control catalysts • Catalyst recycling services • Silicate for catalyst manufacturing Packaging & engineered plastics • Catalysts for high-density polyethlene and chemicals syntheses • Antiblocks for film packaging • Solid and hollow microspheres for composite plastics • Sulfur derivatives for nylon production Highway safety & construction • Reflective markings for roadways and airports • Silica gels for surface coatings Consumer products • Silica gels for edible oil and beer clarification • Precipitated silicas, silicates and zeolites for the dentifrice and dishwasher and laundry detergent applications Natural resources • Silicates for drilling muds • Hollow glass beads, or microspheres, for oil well cements • Silicates and alum for water treatment mining • Bleaching aids for paper The following tables disaggregate the Company’s sales, by segment and end use, for the three and six months ended June 30, 2020 and 2019: Three months ended June 30, 2020 Refining Catalysts Performance Performance Total Industrial & process chemicals $ 16,713 $ 2 $ 9,314 $ 43,747 $ 69,776 Fuels & emission control (1) 50,681 — 42 — 50,723 Packaging & engineered plastics 7,473 25,206 13,645 9,552 55,876 Highway safety & construction (1) — — 78,340 18,312 96,652 Consumer products — — — 59,907 59,907 Natural resources 15,565 — 2,862 11,123 29,550 Total segment sales 90,432 25,208 104,203 142,641 362,484 Eliminations (780) (2) (54) (2,123) (2,959) Total $ 89,652 $ 25,206 $ 104,149 $ 140,518 $ 359,525 Three months ended June 30, 2019 Refining Catalysts Performance Performance Total Industrial & process chemicals $ 21,903 $ — $ 12,783 $ 60,662 $ 95,348 Fuels & emission control (1) 63,505 — — — 63,505 Packaging & engineered plastics 14,067 20,857 17,595 14,344 66,863 Highway safety & construction (1) — — 85,257 22,297 107,554 Consumer products — — — 65,440 65,440 Natural resources 17,815 — 3,237 15,085 36,137 Total segment sales 117,290 20,857 118,872 177,828 434,847 Eliminations (895) 214 (104) (2,387) (3,172) Total $ 116,395 $ 21,071 $ 118,768 $ 175,441 $ 431,675 Six months ended June 30, 2020 Refining Catalysts Performance Performance Total Industrial & process chemicals $ 36,071 $ 49 $ 21,438 $ 103,581 $ 161,139 Fuels & emission control (1) 106,393 — 81 — 106,474 Packaging & engineered plastics 18,207 50,023 31,115 23,827 123,172 Highway safety & construction (1) — — 110,983 38,501 149,484 Consumer products — — — 123,933 123,933 Natural resources 30,452 — 6,155 27,078 63,685 Total segment sales 191,123 50,072 169,772 316,920 727,887 Eliminations (1,705) (49) (109) (4,901) (6,764) Total $ 189,418 $ 50,023 $ 169,663 $ 312,019 $ 721,123 Six months ended June 30, 2019 Refining Catalysts Performance Performance Total Industrial & process chemicals $ 40,305 $ 62 $ 25,812 $ 120,313 $ 186,492 Fuels & emission control (1) 121,195 — — — 121,195 Packaging & engineered plastics 26,756 36,661 34,977 29,073 127,467 Highway safety & construction (1) — — 112,617 44,236 156,853 Consumer products — — — 133,949 133,949 Natural resources 34,878 — 6,555 30,719 72,152 Total segment sales 223,134 36,723 179,961 358,290 798,108 Eliminations (1,782) (62) (152) (5,216) (7,212) Total $ 221,352 $ 36,661 $ 179,809 $ 353,074 $ 790,896 (1) As described in Note 1, the Company experiences seasonal sales fluctuations to customers in the fuels & emission control and highway safety & construction end uses. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements, Recurring | The following table presents information about the Company’s assets and liabilities that were measured at fair value on a recurring basis as of June 30, 2020 and December 31, 2019, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. June 30, Quoted Prices in Significant Other Significant Assets: Derivative contracts (Note 14) $ 5,397 $ — $ 5,397 $ — Restoration plan assets 3,710 3,710 — — Total $ 9,107 $ 3,710 $ 5,397 $ — Liabilities: Derivative contracts (Note 14) $ 4,850 $ — $ 4,850 $ — December 31, Quoted Prices in Significant Other Significant Assets: Derivative contracts (Note 14) $ 3,928 $ — $ 3,928 $ — Restoration plan assets 4,199 4,199 — — Total $ 8,127 $ 4,199 $ 3,928 $ — Liabilities: Derivative contracts (Note 14) $ 12,415 $ — $ 12,415 $ — |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The following tables present the tax effects of each component of other comprehensive income for the three and six months ended June 30, 2020 and 2019: Three months ended June 30, 2020 2019 Pre-tax Tax benefit/ After-tax amount Pre-tax Tax benefit/ After-tax amount Defined benefit and other postretirement plans: Amortization of net gains and (losses) $ 21 $ (8) $ 13 $ (8) $ 2 $ (6) Amortization of prior service cost (40) 14 (26) (33) 8 (25) Benefit plans, net (19) 6 (13) (41) 10 (31) Net (loss) gain from hedging activities 660 (165) 495 (1,556) 389 (1,167) Foreign currency translation (1) 13,153 (1,214) 11,939 5,469 616 6,085 Other comprehensive income (loss) $ 13,794 $ (1,373) $ 12,421 $ 3,872 $ 1,015 $ 4,887 Six months ended June 30, 2020 2019 Pre-tax Tax benefit/ After-tax amount Pre-tax Tax benefit/ After-tax amount Defined benefit and other postretirement plans: Amortization of net gains and (losses) $ 65 $ (16) $ 49 $ (16) $ 4 $ (12) Amortization of prior service cost (104) 27 (77) (65) 16 (49) Benefit plans, net (39) 11 (28) (81) 20 (61) Net (loss) gain from hedging activities (45) 11 (34) (3,625) 906 (2,719) Foreign currency translation (1) (36,904) 2,488 (34,416) 14,751 (1,499) 13,252 Other comprehensive income (loss) $ (36,988) $ 2,510 $ (34,478) $ 11,045 $ (573) $ 10,472 (1) The income tax benefit or expense included in other comprehensive income is attributed to the portion of foreign currency translation associated with the Company’s cross-currency interest rate swaps, for which the tax effect is based on the applicable U.S. deferred income tax rate. See Note 14 to these condensed consolidated financial statements for information regarding the Company’s cross-currency interest rate swaps. The following table presents the changes in accumulated other comprehensive income (loss), net of tax, by component for the six months ended June 30, 2020 and 2019: Defined benefit Net gain (loss) Foreign Total December 31, 2019 $ 3,568 $ (1,838) $ (17,078) $ (15,348) Other comprehensive loss before reclassifications (1) (1,091) (31,304) (32,396) Amounts reclassified from accumulated other comprehensive income (1) (27) 1,057 — 1,030 June 30, 2020 $ 3,540 $ (1,872) $ (48,382) $ (46,714) December 31, 2018 $ (546) $ 637 $ (39,195) $ (39,104) Other comprehensive income (loss) before reclassifications 2 (2,861) 12,797 9,938 Amounts reclassified from accumulated other comprehensive income (1) (63) 142 — 79 Net current period other comprehensive income (loss) (61) (2,719) 12,797 10,017 Tax Cuts and Jobs Act, reclassification from AOCI to retained earnings 1,684 190 — 1,874 June 30, 2019 $ 1,077 $ (1,892) $ (26,398) $ (27,213) (1) See the following table for details about these reclassifications. Amounts in parentheses indicate debits. |
Reclassification out of Accumulated Other Comprehensive Income | The following table presents the reclassifications out of accumulated other comprehensive income for the three and six months ended June 30, 2020 and 2019: Details about Accumulated Other Comprehensive Amounts Reclassified from Accumulated Other Comprehensive Income (1) Affected Line Item where Three months ended Six months ended 2020 2019 2020 2019 Amortization of defined benefit and other postretirement items: Prior service credit (cost) $ 58 $ 33 $ 104 $ 65 Other income (expense) (2) Actuarial gains (losses) (34) 9 (68) 18 Other income (expense) (2) 24 42 36 83 Total before tax (4) (10) (9) (20) Tax expense $ 20 $ 32 $ 27 $ 63 Net of tax Gains and losses on cash flow hedges: Interest rate caps $ (398) $ (169) $ (629) $ (292) Interest expense Natural gas swaps (402) (87) (775) 104 Cost of goods sold (800) (256) (1,404) (188) Total before tax 198 63 347 46 Tax benefit $ (602) $ (193) $ (1,057) $ (142) Net of tax Total reclassifications for the period $ (582) $ (161) $ (1,030) $ (79) Net of tax (1) Amounts in parentheses indicate debits to profit/loss. (2) These accumulated other comprehensive income (loss) components are components of net periodic pension and other postretirement cost (see Note 16 to these condensed consolidated financial statements for additional details). |
Asset Swap Transaction (Tables)
Asset Swap Transaction (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Business Combinations [Abstract] | |
Purchase price allocation | The following table sets forth the calculation and allocation of the consideration given and the identifiable net assets acquired with respect to the asset swap, which was complete as of June 30, 2020. Provisional Purchase Price Allocation Adjustments Purchase Price Total consideration $ 25,166 $ 3,432 $ 28,598 Recognized amounts of identifiable assets acquired and liabilities assumed: Inventories $ 9,912 $ 127 $ 10,039 Property, plant and equipment 9,490 1,339 10,829 Right-of-use lease assets 378 — 378 Fair value of assets acquired 19,780 1,466 21,246 Operating lease liabilities, current (203) — (203) Operating lease liabilities, non-current (175) — (175) (378) — (378) Fair value of net assets acquired 19,402 1,466 20,868 Goodwill 5,764 1,966 7,730 $ 25,166 $ 3,432 $ 28,598 |
Goodwill (Tables)
Goodwill (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The change in the carrying amount of goodwill for the six months ended June 30, 2020 is summarized as follows: Refining Services Catalysts Performance Materials Performance Chemicals Total Balance as of December 31, 2019 $ 311,892 $ 78,611 $ 275,919 $ 593,383 $ 1,259,805 Goodwill recognized — — 7,730 — 7,730 Foreign exchange impact — (1,677) (922) (9,938) (12,537) Balance as of June 30, 2020 $ 311,892 $ 76,934 $ 282,727 $ 583,445 $ 1,254,998 |
Other Operating Expense, Net (T
Other Operating Expense, Net (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Operating Expense, Net | A summary of other operating expense, net is as follows: Three months ended Six months ended 2020 2019 2020 2019 Amortization expense $ 8,550 $ 8,636 $ 17,187 $ 17,300 Transaction and other related costs 775 943 2,644 1,008 Restructuring and other related costs 3,051 80 5,040 111 Net (gain) loss on asset disposals (1) (1,020) (9,659) 8,401 (8,839) Environmental related costs 537 848 546 1,327 Other, net 842 971 859 1,651 $ 12,735 $ 1,819 $ 34,677 $ 12,558 (1) During the six months ended June 30, 2020, the Company completed the purchase price allocation related to the asset swap. In doing so, the Company reduced its provisional loss on disposal of $9,907 (which was recorded during the three month period ended March 31, 2020) to a loss of $6,475, which is reflected in net (gain) loss on asset disposals during the six months ended June 30, 2020. The $3,432 reduction to the loss on the asset swap is reflected in net (gain) loss on asset disposals during the three months ended June 30, 2020. Refer to Note 6 to these condensed consolidated financial statements for details on the asset swap. During the three and six months ended June 30, 2019, the Company recognized a gain of $11,362 related to the sale of a product line. Refer to Note 7 of these condensed consolidated financial statements for additional details. |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current | Inventories, net, are classified and valued as follows: June 30, December 31, Finished products and work in process $ 219,731 $ 222,940 Raw materials 46,889 58,005 $ 266,620 $ 280,945 Valued at lower of cost or market: LIFO basis $ 154,571 $ 168,935 Valued at lower of cost and net realizable value: FIFO or average cost basis 112,049 112,010 $ 266,620 $ 280,945 |
Investments in Affiliated Com_2
Investments in Affiliated Companies (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | The Company accounts for investments in affiliated companies under the equity method. Affiliated companies accounted for on the equity basis as of June 30, 2020 are as follows: Company Country Percent PQ Silicates Ltd. Taiwan 50% Zeolyst International USA 50% Zeolyst C.V. Netherlands 50% Asociacion para el Estudio de las Tecnologias de Equipamiento de Carreteras, S.A. (“Aetec”) Spain 20% Following is summarized information of the combined investments (1) : Three months ended Six months ended 2020 2019 2020 2019 Sales $ 88,161 $ 89,938 $ 159,368 $ 158,032 Gross profit 34,470 35,137 65,609 54,551 Operating income 24,688 27,052 45,697 36,259 Net income 26,333 27,910 46,368 37,150 (1) Summarized information of the combined investments is presented at 100%; the Company’s share of the net assets and net income of affiliates is calculated based on the percent ownership specified in the table above. |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | A summary of property, plant and equipment, at cost, and related accumulated depreciation is as follows: June 30, December 31, Land $ 175,532 $ 183,117 Buildings 223,416 221,449 Machinery and equipment 1,241,387 1,236,531 Construction in progress 81,749 82,687 1,722,084 1,723,784 Less: accumulated depreciation (589,419) (537,014) $ 1,132,665 $ 1,186,770 |
Long-term Debt (Tables)
Long-term Debt (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | The summary of long-term debt is as follows: June 30, December 31, Term Loan Facility $ 947,497 $ 947,497 6.75% Senior Secured Notes due 2022 625,000 625,000 5.75% Senior Unsecured Notes due 2025 295,000 295,000 ABL Facility — — Other 65,484 64,629 Total debt 1,932,981 1,932,126 Original issue discount (14,448) (13,434) Deferred financing costs (10,988) (11,730) Total debt, net of original issue discount and deferred financing costs 1,907,545 1,906,962 Less: current portion (8,602) (7,766) Total long-term debt, excluding current portion $ 1,898,943 $ 1,899,196 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair Value of Derivatives Held | The fair values of derivative instruments held as of June 30, 2020 and December 31, 2019 are shown below: Balance sheet location June 30, December 31, Derivative assets: Derivatives designed as net investment hedges: Cross-currency interest rate swaps Prepaid and other current assets 3,992 3,928 Cross-currency interest rate swaps Other long-term assets 1,405 — Total derivative assets $ 5,397 $ 3,928 Derivative liabilities: Derivatives designated as cash flow hedges: Natural gas swaps Accrued liabilities $ 688 $ 813 Interest rate caps Accrued liabilities 1,636 420 Natural gas swaps Other long-term liabilities 1 226 Interest rate caps Other long-term liabilities 2,525 2,822 4,850 4,281 Derivatives designated as net investment hedges: Cross-currency swaps Other long-term liabilities — 8,134 Total derivative liabilities $ 4,850 $ 12,415 |
Effect of Derivative Instruments Designated as Hedges on Other Comprehensive Income | The following tables show the effect of the Company’s derivative instruments designated as cash flow hedges on AOCI for the three and six months ended June 30, 2020 and 2019: Three months ended June 30, 2020 2019 Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income Interest rate caps Interest (expense) income $ (325) $ (293) $ (675) $ (169) Natural gas swaps Cost of goods sold 198 (494) (1,137) (87) $ (127) $ (787) $ (1,812) $ (256) Six months ended June 30, 2020 2019 Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income Interest rate caps Interest (expense) income $ (920) $ (524) $ (3,048) $ (292) Natural gas swaps Cost of goods sold (517) (867) (766) 104 $ (1,437) $ (1,391) $ (3,814) $ (188) |
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) | The following tables show the effect of the Company’s cash flow hedge accounting on the condensed consolidated statements of income for the three and six months ended June 30, 2020 and 2019: Location and amount of gain (loss) recognized in income on cash flow hedging relationships Three months ended June 30, 2020 2019 Cost of goods sold Interest (expense) Cost of goods sold Interest (expense) Total amounts of income and expense line items presented in the statement of income in which the effects of cash flow hedges are recorded $ (266,686) $ (22,275) $ (316,180) $ (28,540) The effects of cash flow hedging: Gain (loss) on cash flow hedging relationships: Interest contracts: Amount of gain (loss) reclassified from AOCI into income — (293) — (169) Commodity contracts: Amount of gain (loss) reclassified from AOCI into income (494) — (87) — Location and amount of gain (loss) recognized in income on cash flow hedging relationships Six months ended June 30, 2020 2019 Cost of goods sold Interest (expense) Cost of goods sold Interest (expense) Total amounts of income and expense line items presented in the statement of income in which the effects of cash flow hedges are recorded (539,685) (46,730) (594,491) (57,158) The effects of cash flow hedging: Gain (loss) on cash flow hedging relationships: Interest contracts: Amount of gain (loss) reclassified from AOCI into income — (524) — (292) Commodity contracts: Amount of gain (loss) reclassified from AOCI into income (867) — 104 — |
Schedule of Net Investment Hedges in Accumulated Other Comprehensive Income (Loss) | The following tables show the effect of the Company’s net investment hedges on AOCI and the condensed consolidated statements of income for the three and six months ended June 30, 2020 and 2019: Amount of gain (loss) recognized in OCI on derivative Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) reclassified from AOCI into income Location of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Amount of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Three months ended Three months ended Three months ended 2020 2019 2020 2019 2020 2019 Cross-currency interest rate swaps $ (5,206) $ (2,613) Gain (loss) on sale of subsidiary $ — $ — Interest (expense) income $ 1,552 $ 2,465 Amount of gain (loss) recognized in OCI on derivative Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) reclassified from AOCI into income Location of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Amount of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Six months ended Six months ended Six months ended 2020 2019 2020 2019 2020 2019 Cross-currency interest rate swaps $ 9,603 $ 5,940 Gain (loss) on sale of subsidiary $ — $ — Interest (expense) income $ 3,244 $ 3,912 |
Benefit Plans (Tables)
Benefit Plans (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Defined Benefit Pension Plans | |
Defined Benefit Plan Disclosure | |
Components of Net Periodic Expense | Components of net periodic expense (benefit) are as follows: Defined Benefit Pension Plans U.S. Foreign Three months ended Three months ended 2020 2019 2020 2019 Service cost $ 192 $ 281 $ 997 $ 878 Interest cost 2,152 2,798 707 824 Expected return on plan assets (3,331) (3,064) (810) (990) Amortization of net loss — — 41 — Amortization of prior service cost — — 6 12 Net periodic expense (benefit) $ (987) $ 15 $ 941 $ 724 U.S. Foreign Six months ended Six months ended 2020 2019 2020 2019 Service cost $ 384 $ 500 $ 1,994 $ 1,684 Interest cost 4,304 5,305 1,414 1,657 Expected return on plan assets (6,662) (5,821) (1,620) (1,593) Amortization of net loss — — 82 — Amortization of prior service cost — — 12 12 Net periodic expense (benefit) $ (1,974) $ (16) $ 1,882 $ 1,760 |
Supplemental Retirement Plans | |
Defined Benefit Plan Disclosure | |
Components of Net Periodic Expense | Supplemental Retirement Plans Three months ended Six months ended 2020 2019 2020 2019 Interest cost $ 86 $ 122 $ 172 $ 243 Net periodic expense $ 86 $ 122 $ 172 $ 243 |
Other Postretirement Benefits Plans | |
Defined Benefit Plan Disclosure | |
Components of Net Periodic Expense | Other Postretirement Benefit Plans Three months ended Six months ended 2020 2019 2020 2019 Service cost $ — $ 4 $ — $ 7 Interest cost 24 38 48 76 Amortization of prior service credit (58) (33) (116) (65) Amortization of net gain (7) (9) (14) (18) Net periodic expense (benefit) $ (41) $ — $ (82) $ — |
Reportable Segments (Tables)
Reportable Segments (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue from Reportable Segments to Consolidated | Summarized financial information for the Company’s reportable segments is shown in the following table: Three months ended Six months ended 2020 2019 2020 2019 Sales: Refining Services $ 90,432 $ 117,290 $ 191,123 $ 223,134 Catalysts (1) 25,208 20,857 50,072 36,723 Performance Materials 104,203 118,872 169,772 179,961 Performance Chemicals 142,641 177,828 316,920 358,290 Eliminations (2) (2,959) (3,172) (6,764) (7,212) Total $ 359,525 $ 431,675 $ 721,123 $ 790,896 Segment Adjusted EBITDA: (3) Refining Services $ 34,996 $ 42,824 $ 72,179 $ 82,555 Catalysts (4) 25,312 29,607 47,979 47,734 Performance Materials 27,306 29,221 40,813 39,736 Performance Chemicals 34,011 41,165 74,485 83,838 Total Segment Adjusted EBITDA (5) $ 121,625 $ 142,817 $ 235,456 $ 253,863 (1) Excludes the Company’s proportionate share of sales from the Zeolyst International and Zeolyst C.V. joint ventures (collectively, the “Zeolyst Joint Venture”) accounted for using the equity method (see Note 11 to these condensed consolidated financial statements for further information). The proportionate share of sales is $40,852 and $39,124 for the three months ended June 30, 2020 and 2019, respectively. The proportionate share of sales is $73,143 and $68,602 for the six months ended June 30, 2020 and 2019, respectively. (2) The Company eliminates intersegment sales when reconciling to the Company’s condensed consolidated statements of income. (3) The Company defines Adjusted EBITDA as EBITDA adjusted for certain items as noted in the reconciliation below. Management evaluates the performance of its segments and allocates resources based on several factors, of which the primary measure is Adjusted EBITDA. Adjusted EBITDA should not be considered as an alternative to net income as an indicator of the Company’s operating performance. Adjusted EBITDA as defined by the Company may not be comparable with EBITDA or Adjusted EBITDA as defined by other companies. (4) The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalysts segment is $16,855 for the three months ended June 30, 2020, which includes $11,489 of equity in net income plus $1,659 of amortization of investment in affiliate step-up and $3,707 of joint venture depreciation, amortization and interest. The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalysts segment is $17,636 for the three months ended June 30, 2019, which includes $12,264 of equity in net income plus $1,659 of amortization of investment in affiliate step-up and $3,713 of joint venture depreciation, amortization and interest. The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalysts segment is $30,580 for the six months ended June 30, 2020, which includes $19,806 of equity in net income plus $3,317 of amortization of investment in affiliate step-up and $7,457 of joint venture depreciation, amortization and interest. The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalysts segment is $25,993 for the six months ended June 30, 2019, which includes $14,300 of equity in net income plus $4,217 of amortization of investment in affiliate step-up and $7,476 of joint venture depreciation, amortization and interest. (5) Total Segment Adjusted EBITDA differs from the Company’s consolidated Adjusted EBITDA due to unallocated corporate expenses. |
Reconciliation of Net Income to Segment Adjusted EBITDA | A reconciliation of net income attributable to PQ Group Holdings to Segment Adjusted EBITDA is as follows: Three months ended Six months ended 2020 2019 2020 2019 Reconciliation of net income attributable to PQ Group Holdings Inc. to Segment Adjusted EBITDA Net income attributable to PQ Group Holdings Inc. $ 15,926 $ 30,574 $ 16,150 $ 33,725 Provision for income taxes 16,262 20,307 17,689 22,754 Interest expense, net 22,275 28,540 46,730 57,158 Depreciation and amortization 44,822 45,090 90,493 90,984 Segment EBITDA 99,285 124,511 171,062 204,621 Joint venture depreciation, amortization and interest 3,708 3,713 7,457 7,476 Amortization of investment in affiliate step-up 1,659 1,659 3,317 4,217 Debt extinguishment costs — — 2,513 — Net (gain) loss on asset disposals (1,020) (9,653) 8,401 (8,833) Foreign currency exchange (gain) loss (854) 3,612 2,483 923 LIFO expense (1,469) 122 (1,798) 10,280 Transaction and other related costs 739 975 2,801 1,055 Equity-based compensation 6,366 5,370 12,286 8,770 Restructuring, integration and business optimization expenses 3,591 (13) 5,620 719 Defined benefit pension plan (benefit) cost (252) 552 (500) 1,545 Other 1,284 1,605 2,538 2,721 Adjusted EBITDA 113,037 132,453 216,180 233,494 Unallocated corporate expenses 8,588 10,364 19,276 20,369 Segment Adjusted EBITDA $ 121,625 $ 142,817 $ 235,456 $ 253,863 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Stock-Based Compensation [Abstract] | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The following table provides the assumptions used to determine the grant date fair value of the market condition-dependent / TSR goal-based portion of the Company’s performance stock units granted during the six months ended June 30, 2020 using a Monte Carlo simulation: Expected dividend yield — % Risk-free interest rate 1.56 % Expected volatility 28.57 % Expected term (in years) 2.95 Grant date fair value $ 24.11 |
Schedule of Nonvested Restricted Stock and Performance Stock Unit Activity | The following table summarizes the activity for the Company’s restricted stock units and performance stock units for the six months ended June 30, 2020: Restricted Stock Units Performance Stock Units Number of Weighted Average Grant Date Fair Value (per share) Number of Weighted Average Grant Date Fair Value (per share) Nonvested as of December 31, 2019 1,628,436 $ 15.83 550,676 $ 15.41 Granted 1,158,605 $ 16.60 456,311 $ 20.38 Vested (441,760) $ 15.43 — $ — Forfeited (99,667) $ 16.30 (31,069) $ 15.41 Nonvested as of June 30, 2020 2,245,614 $ 16.29 975,918 $ 17.74 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
Reconciliation from Basic to Diluted Weighted Average Number of Shares Outstanding | The reconciliation from basic to diluted weighted average shares outstanding is as follows: Three months ended Six months ended 2020 2019 2020 2019 Weighted average shares outstanding – Basic 135,083,126 134,142,552 135,278,764 134,044,972 Dilutive effect of unvested common shares and restricted stock units with service conditions, performance stock units considered probable of vesting and assumed stock option exercises and conversions 588,704 1,180,472 800,776 1,062,035 Weighted average shares outstanding – Diluted 135,671,830 135,323,024 136,079,540 135,107,007 |
Schedule of Earnings Per Share, Basic and Diluted | Basic and diluted earnings per share are calculated as follows: Three months ended Six months ended 2020 2019 2020 2019 Numerator: Net income attributable to PQ Group Holdings Inc. $ 15,926 $ 30,574 $ 16,150 $ 33,725 Denominator: Weighted average shares outstanding – Basic 135,083,126 134,142,552 135,278,764 134,044,972 Weighted average shares outstanding – Diluted 135,671,830 135,323,024 136,079,540 135,107,007 Net income per share: Basic income per share $ 0.12 $ 0.23 $ 0.12 $ 0.25 Diluted income per share $ 0.12 $ 0.23 $ 0.12 $ 0.25 |
Schedule of Securities Excluded from Computation of Earnings Per Share | The table below presents the details of the Company’s weighted average equity-based awards outstanding during each respective period that were excluded from the calculation of diluted earnings per share: Three months ended Six months ended 2020 2019 2020 2019 Restricted stock awards with performance only targets not yet achieved 1,507,366 1,637,134 1,511,868 1,638,318 Stock options with performance only targets not yet achieved 509,888 586,253 516,110 586,253 Anti-dilutive restricted stock awards, restricted stock units and performance stock units 2,262,974 — 1,421,401 2,012 Anti-dilutive stock options 844,475 863,063 847,641 863,063 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures | The following table presents supplemental cash flow information for the Company: Six months ended 2020 2019 Cash paid during the period for: Income taxes, net of refunds $ 14,436 $ 8,301 Interest (1) 54,248 59,035 Non-cash investing activity (2) : Capital expenditures acquired on account but unpaid as of the period end 6,716 10,405 Right-of-use assets obtained in exchange for new lease liabilities (non-cash) (2) : Operating leases 3,641 1,566 (1) Cash paid for interest is shown net of capitalized interest for the periods presented and excludes $2,197 and $4,478 of net interest proceeds on swaps designated as net investment hedges for the six months ended June 30, 2020 and 2019, respectively, which are included within cash flows from investing activities in the Company’s condensed consolidated statements of cash flows. (2) The Company entered into a non-monetary asset swap arrangement whereby it exchanged certain assets with a third party. Details of the associated non-cash investing activities are further described in Note 6 to these condensed consolidated financial statements. As part of the asset swap transaction, the Company assumed a lease contract that is exclusive of those summarized in the above table. |
Schedule of Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets as of June 30, 2020 and 2019 to the total of the same amounts shown in the condensed consolidated statements of cash flows for the six months then ended: June 30, 2020 2019 Cash and cash equivalents $ 88,640 $ 82,200 Restricted cash included in prepaid and other current assets 1,948 1,759 Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows $ 90,588 $ 83,959 |
Restrictions on Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets as of June 30, 2020 and 2019 to the total of the same amounts shown in the condensed consolidated statements of cash flows for the six months then ended: June 30, 2020 2019 Cash and cash equivalents $ 88,640 $ 82,200 Restricted cash included in prepaid and other current assets 1,948 1,759 Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows $ 90,588 $ 83,959 |
Background and Basis of Prese_3
Background and Basis of Presentation (Details) - reporting_unit | Mar. 01, 2019 | Mar. 31, 2019 | Jun. 30, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Number of reporting units | 4 | 4 | 4 |
Disaggregated Revenue (Details)
Disaggregated Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Disaggregated Revenue | ||||
Sales | $ 359,525 | $ 431,675 | $ 721,123 | $ 790,896 |
Refining Services | ||||
Disaggregated Revenue | ||||
Sales | 89,652 | 116,395 | 189,418 | 221,352 |
Catalysts | ||||
Disaggregated Revenue | ||||
Sales | 25,206 | 21,071 | 50,023 | 36,661 |
Performance Materials | ||||
Disaggregated Revenue | ||||
Sales | 104,149 | 118,768 | 169,663 | 179,809 |
Performance Chemicals | ||||
Disaggregated Revenue | ||||
Sales | 140,518 | 175,441 | 312,019 | 353,074 |
Operating segments | ||||
Disaggregated Revenue | ||||
Sales | 362,484 | 434,847 | 727,887 | 798,108 |
Operating segments | Industrial & process chemicals | ||||
Disaggregated Revenue | ||||
Sales | 69,776 | 95,348 | 161,139 | 186,492 |
Operating segments | Fuels & emission control | ||||
Disaggregated Revenue | ||||
Sales | 50,723 | 63,505 | 106,474 | 121,195 |
Operating segments | Packaging & engineered plastics | ||||
Disaggregated Revenue | ||||
Sales | 55,876 | 66,863 | 123,172 | 127,467 |
Operating segments | Highway safety & construction | ||||
Disaggregated Revenue | ||||
Sales | 96,652 | 107,554 | 149,484 | 156,853 |
Operating segments | Consumer products | ||||
Disaggregated Revenue | ||||
Sales | 59,907 | 65,440 | 123,933 | 133,949 |
Operating segments | Natural resources | ||||
Disaggregated Revenue | ||||
Sales | 29,550 | 36,137 | 63,685 | 72,152 |
Operating segments | Refining Services | ||||
Disaggregated Revenue | ||||
Sales | 90,432 | 117,290 | 191,123 | 223,134 |
Operating segments | Refining Services | Industrial & process chemicals | ||||
Disaggregated Revenue | ||||
Sales | 16,713 | 21,903 | 36,071 | 40,305 |
Operating segments | Refining Services | Fuels & emission control | ||||
Disaggregated Revenue | ||||
Sales | 50,681 | 63,505 | 106,393 | 121,195 |
Operating segments | Refining Services | Packaging & engineered plastics | ||||
Disaggregated Revenue | ||||
Sales | 7,473 | 14,067 | 18,207 | 26,756 |
Operating segments | Refining Services | Highway safety & construction | ||||
Disaggregated Revenue | ||||
Sales | 0 | 0 | 0 | 0 |
Operating segments | Refining Services | Consumer products | ||||
Disaggregated Revenue | ||||
Sales | 0 | 0 | 0 | 0 |
Operating segments | Refining Services | Natural resources | ||||
Disaggregated Revenue | ||||
Sales | 15,565 | 17,815 | 30,452 | 34,878 |
Operating segments | Catalysts | ||||
Disaggregated Revenue | ||||
Sales | 25,208 | 20,857 | 50,072 | 36,723 |
Operating segments | Catalysts | Industrial & process chemicals | ||||
Disaggregated Revenue | ||||
Sales | 2 | 0 | 49 | 62 |
Operating segments | Catalysts | Fuels & emission control | ||||
Disaggregated Revenue | ||||
Sales | 0 | 0 | 0 | 0 |
Operating segments | Catalysts | Packaging & engineered plastics | ||||
Disaggregated Revenue | ||||
Sales | 25,206 | 20,857 | 50,023 | 36,661 |
Operating segments | Catalysts | Highway safety & construction | ||||
Disaggregated Revenue | ||||
Sales | 0 | 0 | 0 | 0 |
Operating segments | Catalysts | Consumer products | ||||
Disaggregated Revenue | ||||
Sales | 0 | 0 | 0 | 0 |
Operating segments | Catalysts | Natural resources | ||||
Disaggregated Revenue | ||||
Sales | 0 | 0 | 0 | 0 |
Operating segments | Performance Materials | ||||
Disaggregated Revenue | ||||
Sales | 104,203 | 118,872 | 169,772 | 179,961 |
Operating segments | Performance Materials | Industrial & process chemicals | ||||
Disaggregated Revenue | ||||
Sales | 9,314 | 12,783 | 21,438 | 25,812 |
Operating segments | Performance Materials | Fuels & emission control | ||||
Disaggregated Revenue | ||||
Sales | 42 | 0 | 81 | 0 |
Operating segments | Performance Materials | Packaging & engineered plastics | ||||
Disaggregated Revenue | ||||
Sales | 13,645 | 17,595 | 31,115 | 34,977 |
Operating segments | Performance Materials | Highway safety & construction | ||||
Disaggregated Revenue | ||||
Sales | 78,340 | 85,257 | 110,983 | 112,617 |
Operating segments | Performance Materials | Consumer products | ||||
Disaggregated Revenue | ||||
Sales | 0 | 0 | 0 | 0 |
Operating segments | Performance Materials | Natural resources | ||||
Disaggregated Revenue | ||||
Sales | 2,862 | 3,237 | 6,155 | 6,555 |
Operating segments | Performance Chemicals | ||||
Disaggregated Revenue | ||||
Sales | 142,641 | 177,828 | 316,920 | 358,290 |
Operating segments | Performance Chemicals | Industrial & process chemicals | ||||
Disaggregated Revenue | ||||
Sales | 43,747 | 60,662 | 103,581 | 120,313 |
Operating segments | Performance Chemicals | Fuels & emission control | ||||
Disaggregated Revenue | ||||
Sales | 0 | 0 | 0 | 0 |
Operating segments | Performance Chemicals | Packaging & engineered plastics | ||||
Disaggregated Revenue | ||||
Sales | 9,552 | 14,344 | 23,827 | 29,073 |
Operating segments | Performance Chemicals | Highway safety & construction | ||||
Disaggregated Revenue | ||||
Sales | 18,312 | 22,297 | 38,501 | 44,236 |
Operating segments | Performance Chemicals | Consumer products | ||||
Disaggregated Revenue | ||||
Sales | 59,907 | 65,440 | 123,933 | 133,949 |
Operating segments | Performance Chemicals | Natural resources | ||||
Disaggregated Revenue | ||||
Sales | 11,123 | 15,085 | 27,078 | 30,719 |
Inter-segment sales eliminations | ||||
Disaggregated Revenue | ||||
Sales | (2,959) | (3,172) | (6,764) | (7,212) |
Inter-segment sales eliminations | Refining Services | ||||
Disaggregated Revenue | ||||
Sales | (780) | (895) | (1,705) | (1,782) |
Inter-segment sales eliminations | Catalysts | ||||
Disaggregated Revenue | ||||
Sales | (2) | 214 | (49) | (62) |
Inter-segment sales eliminations | Performance Materials | ||||
Disaggregated Revenue | ||||
Sales | (54) | (104) | (109) | (152) |
Inter-segment sales eliminations | Performance Chemicals | ||||
Disaggregated Revenue | ||||
Sales | $ (2,123) | $ (2,387) | $ (4,901) | $ (5,216) |
Contract Assets and Liabilities
Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | |||||
Contract assets | $ 0 | $ 0 | $ 0 | ||
Contract liabilities | 9,000 | 9,000 | 9,000 | ||
Deferred revenue | 4,140 | 4,140 | $ 6,450 | ||
Revenue recognized | $ 1,035 | $ 0 | $ 2,304 | $ 0 |
Assets and Liabilities Measured
Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - Recurring - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Assets: | ||
Derivative contracts | $ 5,397 | $ 3,928 |
Restoration plan assets | 3,710 | 4,199 |
Total | 9,107 | 8,127 |
Liabilities: | ||
Derivative contracts | 4,850 | 12,415 |
Quoted Prices in Active Markets (Level 1) | ||
Assets: | ||
Derivative contracts | 0 | 0 |
Restoration plan assets | 3,710 | 4,199 |
Total | 3,710 | 4,199 |
Liabilities: | ||
Derivative contracts | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Derivative contracts | 5,397 | 3,928 |
Restoration plan assets | 0 | 0 |
Total | 5,397 | 3,928 |
Liabilities: | ||
Derivative contracts | 4,850 | 12,415 |
Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Derivative contracts | 0 | 0 |
Restoration plan assets | 0 | 0 |
Total | 0 | 0 |
Liabilities: | ||
Derivative contracts | $ 0 | $ 0 |
Pre-tax and After-tax Component
Pre-tax and After-tax Components of Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
After-tax amount | ||||||
Pre-tax amount | $ 13,794 | $ 3,872 | $ (36,988) | $ 11,045 | ||
Tax benefit/ (expense) | (1,373) | 1,015 | 2,510 | (573) | ||
Total other comprehensive income (loss) | 12,421 | $ (46,899) | 4,887 | $ 5,585 | (34,478) | 10,472 |
Amortization of net gains and (losses) | ||||||
After-tax amount | ||||||
Pre-tax amount | 21 | (8) | 65 | (16) | ||
Tax benefit/ (expense) | (8) | 2 | (16) | 4 | ||
Total other comprehensive income (loss) | 13 | (6) | 49 | (12) | ||
Amortization of prior service cost | ||||||
After-tax amount | ||||||
Pre-tax amount | (40) | (33) | (104) | (65) | ||
Tax benefit/ (expense) | 14 | 8 | 27 | 16 | ||
Total other comprehensive income (loss) | (26) | (25) | (77) | (49) | ||
Benefit plans, net | ||||||
After-tax amount | ||||||
Pre-tax amount | (19) | (41) | (39) | (81) | ||
Tax benefit/ (expense) | 6 | 10 | 11 | 20 | ||
Total other comprehensive income (loss) | (13) | (31) | (28) | (61) | ||
Net (loss) gain from hedging activities | ||||||
After-tax amount | ||||||
Pre-tax amount | 660 | (1,556) | (45) | (3,625) | ||
Tax benefit/ (expense) | (165) | 389 | 11 | 906 | ||
Total other comprehensive income (loss) | 495 | (1,167) | (34) | (2,719) | ||
Foreign currency translation | ||||||
After-tax amount | ||||||
Pre-tax amount | 13,153 | 5,469 | (36,904) | 14,751 | ||
Tax benefit/ (expense) | (1,214) | 616 | 2,488 | (1,499) | ||
Total other comprehensive income (loss) | $ 11,939 | $ 6,085 | $ (34,416) | $ 13,252 |
Change by Component (Details)
Change by Component (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | $ 1,779,450 | |
Ending balance | 1,772,812 | |
Total | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (15,348) | $ (39,104) |
Other comprehensive loss before reclassifications | (32,396) | 9,938 |
Amounts reclassified from accumulated other comprehensive income | 1,030 | 79 |
Net current period other comprehensive loss | 10,017 | |
Tax Cuts and Jobs Act, reclassification from AOCI to retained earnings | 1,874 | |
Ending balance | (46,714) | (27,213) |
Defined benefit and other postretirement plans | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | 3,568 | (546) |
Other comprehensive loss before reclassifications | (1) | 2 |
Amounts reclassified from accumulated other comprehensive income | (27) | (63) |
Net current period other comprehensive loss | (61) | |
Tax Cuts and Jobs Act, reclassification from AOCI to retained earnings | 1,684 | |
Ending balance | 3,540 | 1,077 |
Net gain (loss) from hedging activities | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (1,838) | 637 |
Other comprehensive loss before reclassifications | (1,091) | (2,861) |
Amounts reclassified from accumulated other comprehensive income | 1,057 | 142 |
Net current period other comprehensive loss | (2,719) | |
Tax Cuts and Jobs Act, reclassification from AOCI to retained earnings | 190 | |
Ending balance | (1,872) | (1,892) |
Foreign currency translation | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (17,078) | (39,195) |
Other comprehensive loss before reclassifications | (31,304) | 12,797 |
Amounts reclassified from accumulated other comprehensive income | 0 | 0 |
Net current period other comprehensive loss | 12,797 | |
Tax Cuts and Jobs Act, reclassification from AOCI to retained earnings | 0 | |
Ending balance | $ (48,382) | $ (26,398) |
Reclassifications out of AOCI (
Reclassifications out of AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Other (income) expense, net | $ (2,114) | $ 3,035 | $ 691 | $ 56 | ||
Interest expense, net | 22,275 | 28,540 | 46,730 | 57,158 | ||
Cost of goods sold | 266,686 | 316,180 | 539,685 | 594,491 | ||
Income before income taxes and noncontrolling interest | (32,509) | (51,026) | (34,445) | (56,914) | ||
Tax benefit (expense) | 16,262 | 20,307 | 17,689 | 22,754 | ||
Net income | (16,247) | $ (509) | (30,719) | $ (3,441) | (16,756) | (34,160) |
Amount of gain (loss) reclassified from AOCI into income | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Net income | (582) | (161) | (1,030) | (79) | ||
Defined benefit and other postretirement plans | Amount of gain (loss) reclassified from AOCI into income | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Income before income taxes and noncontrolling interest | 24 | 42 | 36 | 83 | ||
Tax benefit (expense) | (4) | (10) | (9) | (20) | ||
Net income | 20 | 32 | 27 | 63 | ||
Prior service credit (cost) | Amount of gain (loss) reclassified from AOCI into income | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Other (income) expense, net | 58 | 33 | 104 | 65 | ||
Actuarial gains (losses) | Amount of gain (loss) reclassified from AOCI into income | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Other (income) expense, net | (34) | 9 | (68) | 18 | ||
Net gain (loss) from hedging activities | Amount of gain (loss) reclassified from AOCI into income | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Income before income taxes and noncontrolling interest | (800) | (256) | (1,404) | (188) | ||
Tax benefit (expense) | 198 | 63 | 347 | 46 | ||
Net income | (602) | (193) | (1,057) | (142) | ||
Net gain (loss) from hedging activities | Amount of gain (loss) reclassified from AOCI into income | Interest rate caps | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Interest expense, net | (398) | (169) | (629) | (292) | ||
Net gain (loss) from hedging activities | Amount of gain (loss) reclassified from AOCI into income | Natural gas swaps | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Cost of goods sold | $ (402) | $ (87) | $ (775) | $ 104 |
Stock Repurchase Program (Detai
Stock Repurchase Program (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Mar. 12, 2020 | |
Equity [Abstract] | ||
Stock Repurchase Program, authorized amount | $ 50,000 | |
Shares acquired | 211,700 | |
Average cost per share | $ 9.73 | |
Repurchases of common shares value | $ 2,059 | |
Remaining authorized repurchase amount | $ 47,941 |
Asset Swap Transaction (Details
Asset Swap Transaction (Details) - USD ($) $ in Thousands | Feb. 19, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 |
Business Combination | |||||||
Loss on disposal recognized | $ 1,020 | $ 9,659 | $ (8,401) | $ 8,839 | |||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Goodwill | 1,254,998 | 1,254,998 | $ 1,259,805 | ||||
Asset Swap | |||||||
Business Combination | |||||||
Loss on disposal recognized | $ (9,907) | (6,475) | |||||
Total consideration, net of cash acquired | $ 25,166 | 28,598 | |||||
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||||||
Inventories | 9,912 | 10,039 | 10,039 | ||||
Property, plant, and equipment | 9,490 | 10,829 | 10,829 | ||||
Right-of-use lease assets | 378 | 378 | 378 | ||||
Fair value of assets acquired | 19,780 | 21,246 | 21,246 | ||||
Operating lease liabilities, current | 203 | 203 | 203 | ||||
Operating lease liabilities, non-current | 175 | 175 | 175 | ||||
Total liabilities assumed | 378 | 378 | 378 | ||||
Fair value of net assets acquired | 19,402 | 20,868 | 20,868 | ||||
Goodwill | 5,764 | 7,730 | 7,730 | ||||
Net assets including goodwill acquired | $ 25,166 | 28,598 | $ 28,598 | ||||
Adjustments | |||||||
Total consideration | 3,432 | ||||||
Inventories | 127 | ||||||
Property, plant and equipment | 1,339 | ||||||
Right-of-use lease assets | 0 | ||||||
Fair value of assets acquired | 1,466 | ||||||
Operating lease liabilities, current | 0 | ||||||
Operating lease liabilities, non-current | 0 | ||||||
Total liabilities assumed | 0 | ||||||
Fair value of net assets acquired | 1,466 | ||||||
Goodwill | 1,966 | ||||||
Net assets including goodwill acquired | $ 3,432 |
Sale of Product Line (Details)
Sale of Product Line (Details) - USD ($) $ in Thousands | Jun. 28, 2019 | Jun. 30, 2019 | Jun. 30, 2020 | Dec. 31, 2019 |
Sale of Product Line [Line Items] | ||||
Pre-tax gain on sale | $ 11,362 | |||
Net Working Capital | $ 4,215 | |||
Property, plant and equipment, net | $ 1,132,665 | $ 1,186,770 | ||
Sulfate Salts Product Line | Disposal group, disposed of by sale, not discontinued operations | ||||
Sale of Product Line [Line Items] | ||||
Consideration for sale of product line | 28,000 | |||
Pre-tax gain on sale | 11,362 | |||
Property, plant and equipment, net | 3,423 | |||
Deferred revenue | $ 9,000 |
Goodwill (Details)
Goodwill (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Goodwill | |
Beginning balance | $ 1,259,805 |
Goodwill recognized | 7,730 |
Foreign exchange impact | (12,537) |
Ending balance | 1,254,998 |
Refining Services | |
Goodwill | |
Beginning balance | 311,892 |
Goodwill recognized | 0 |
Foreign exchange impact | 0 |
Ending balance | 311,892 |
Catalysts | |
Goodwill | |
Beginning balance | 78,611 |
Goodwill recognized | 0 |
Foreign exchange impact | (1,677) |
Ending balance | 76,934 |
Performance Materials | |
Goodwill | |
Beginning balance | 275,919 |
Goodwill recognized | 7,730 |
Foreign exchange impact | (922) |
Ending balance | 282,727 |
Performance Chemicals | |
Goodwill | |
Beginning balance | 593,383 |
Goodwill recognized | 0 |
Foreign exchange impact | (9,938) |
Ending balance | $ 583,445 |
Other Operating Expense, Net (D
Other Operating Expense, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Business Combination | |||||
Amortization expense | $ 8,550 | $ 8,636 | $ 17,187 | $ 17,300 | |
Transaction and other related costs | 775 | 943 | 2,644 | 1,008 | |
Restructuring and other related costs | 3,051 | 80 | 5,040 | 111 | |
Net (gain) loss on asset disposals | (1,020) | (9,659) | 8,401 | (8,839) | |
Environmental related costs | 537 | 848 | 546 | 1,327 | |
Other, net | 842 | 971 | 859 | 1,651 | |
Other operating expense, net | 12,735 | $ 1,819 | 34,677 | 12,558 | |
Pre-tax gain on sale | $ 11,362 | ||||
Asset Swap | |||||
Business Combination | |||||
Net (gain) loss on asset disposals | $ 9,907 | $ 6,475 | |||
Reduction on loss on the asset swap | $ 3,432 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Inventory, Net | ||
Finished products and work in process | $ 219,731 | $ 222,940 |
Raw materials | 46,889 | 58,005 |
Inventories, net | 266,620 | 280,945 |
Valued at lower of cost or market: | ||
LIFO basis | 154,571 | 168,935 |
Valued at lower of cost and net realizable value: | ||
FIFO or average cost basis | 112,049 | 112,010 |
Inventories, net | $ 266,620 | $ 280,945 |
Ownership Percentage (Details)
Ownership Percentage (Details) | Jun. 30, 2020 | Mar. 31, 2020 |
PQ Silicates Ltd. | ||
Schedule of Equity Method Investments | ||
Ownership percentage | 50.00% | |
Zeolyst International | ||
Schedule of Equity Method Investments | ||
Ownership percentage | 50.00% | |
Zeolyst C.V. | ||
Schedule of Equity Method Investments | ||
Ownership percentage | 50.00% | |
Asociacion para el Estudio de las Tecnologias de Equipamiento de Carreteras, S.A. (“Aetec”) | ||
Schedule of Equity Method Investments | ||
Ownership percentage | 20.00% | |
Quaker Holdings | ||
Schedule of Equity Method Investments | ||
Ownership percentage | 49.00% |
Summarized Income Statement (De
Summarized Income Statement (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Schedule of Equity Method Investments | ||||||
Gross profit | $ 92,839 | $ 115,495 | $ 181,438 | $ 196,405 | ||
Net income | 16,247 | $ 509 | 30,719 | $ 3,441 | 16,756 | 34,160 |
Equity Method Investment, Nonconsolidated Investee | ||||||
Schedule of Equity Method Investments | ||||||
Sales | 88,161 | 89,938 | 159,368 | 158,032 | ||
Gross profit | 34,470 | 35,137 | 65,609 | 54,551 | ||
Operating income | 24,688 | 27,052 | 45,697 | 36,259 | ||
Net income | $ 26,333 | $ 27,910 | $ 46,368 | $ 37,150 |
Investments in Affiliated Com_3
Investments in Affiliated Companies Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Business Combination | ||||||
Liquidating dividend | $ 729 | |||||
Sale of joint venture shares | $ 1,032 | |||||
Business Combination | ||||||
Business Combination | ||||||
Net purchase accounting fair value adjustments | $ 247,215 | $ 247,215 | $ 250,532 | |||
Amortization of investment in affiliate step-up | $ 1,659 | $ 1,659 | $ 3,317 | $ 4,217 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment | ||
Property, plant and equipment, gross | $ 1,722,084 | $ 1,723,784 |
Less: accumulated depreciation | (589,419) | (537,014) |
Property, plant and equipment, net | 1,132,665 | 1,186,770 |
Land | ||
Property, Plant and Equipment | ||
Property, plant and equipment, gross | 175,532 | 183,117 |
Buildings | ||
Property, Plant and Equipment | ||
Property, plant and equipment, gross | 223,416 | 221,449 |
Machinery and equipment | ||
Property, Plant and Equipment | ||
Property, plant and equipment, gross | 1,241,387 | 1,236,531 |
Construction in progress | ||
Property, Plant and Equipment | ||
Property, plant and equipment, gross | $ 81,749 | $ 82,687 |
Property, Plant and Equipment N
Property, Plant and Equipment Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation | $ 33,243 | $ 32,381 | $ 66,744 | $ 65,535 |
Long-term Debt (Details)
Long-term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Debt Instrument | ||
Total debt | $ 1,932,981 | $ 1,932,126 |
Original issue discount | (14,448) | (13,434) |
Deferred financing costs | (10,988) | (11,730) |
Total debt, net of original issue discount and deferred financing costs | 1,907,545 | 1,906,962 |
Less: current portion | (8,602) | (7,766) |
Total long-term debt, excluding current portion | 1,898,943 | 1,899,196 |
Term Loan Facility | ||
Debt Instrument | ||
Total debt | 947,497 | 947,497 |
Senior Notes | 6.75% Senior Secured Notes due 2022 | ||
Debt Instrument | ||
Total debt | 625,000 | 625,000 |
Senior Notes | 5.75% Senior Unsecured Notes due 2025 | ||
Debt Instrument | ||
Total debt | 295,000 | 295,000 |
ABL Facility | ||
Debt Instrument | ||
Total debt | 0 | 0 |
Other | ||
Debt Instrument | ||
Total debt | $ 65,484 | $ 64,629 |
Long-term Debt Narrative (Detai
Long-term Debt Narrative (Details) - USD ($) $ in Thousands | Jul. 01, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
Debt Instrument | |||
Total debt | $ 1,932,981 | $ 1,932,126 | |
New Term Loan Facility | Subsequent Event | |||
Debt Instrument | |||
New Term Loan Facility | $ 650,000 | ||
Term Loan And Senior Notes | |||
Debt Instrument | |||
Long-term debt, fair value | 1,841,160 | 1,905,822 | |
Senior Notes | 6.75% Senior Secured Notes due 2022 | |||
Debt Instrument | |||
Total debt | $ 625,000 | $ 625,000 |
Financial Instruments Narrative
Financial Instruments Narrative (Details) € in Thousands, $ in Thousands, MMBTU in Millions | Mar. 18, 2020USD ($) | Feb. 20, 2020USD ($) | Nov. 30, 2018USD ($) | Jul. 31, 2016USD ($) | Jun. 30, 2020USD ($)MMBTU | Jul. 31, 2020USD ($) | Feb. 28, 2018EUR (€) |
Cash flow hedging | |||||||
Derivative | |||||||
Amount of derivative loss expected to be transferred from OCI | $ 688 | ||||||
Cash flow hedging | Natural gas swaps | |||||||
Derivative | |||||||
Derivative, notional quantity | MMBTU | 2.5 | ||||||
Cash flow hedging | July 2016 interest rate caps | |||||||
Derivative | |||||||
Premium paid to acquire derivative instrument | $ 1,551 | ||||||
Derivative, cap interest rate | 3.00% | ||||||
Derivative, notional amount | $ 1,000,000 | ||||||
Cash flow hedging | July 2016 interest rate caps | Minimum | |||||||
Derivative | |||||||
Derivative, cap interest rate | 1.50% | ||||||
Cash flow hedging | July 2016 interest rate caps | Maximum | |||||||
Derivative | |||||||
Derivative, cap interest rate | 3.00% | ||||||
Cash flow hedging | November 2018 interest rate caps | |||||||
Derivative | |||||||
Premium paid to acquire derivative instrument | $ 900 | $ 130 | $ 3,380 | $ 4,410 | |||
Derivative, cap interest rate | 0.84% | 2.50% | 3.50% | ||||
Derivative, notional amount | $ 500,000 | ||||||
Cash flow hedging | July 2020 Interest Rate Cap [Member] | Subsequent Event | |||||||
Derivative | |||||||
Derivative, cap interest rate | 1.00% | ||||||
Derivative, notional amount | $ 400,000 | ||||||
Net investment hedging | Cross-currency interest rate swaps | |||||||
Derivative | |||||||
Derivative, notional amount | $ 314,818 | € 280,000 |
Fair Value (Details)
Fair Value (Details) - Derivatives designated as hedging instrument - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Derivative assets: | ||
Total derivative assets | $ 5,397 | $ 3,928 |
Derivative liabilities: | ||
Total derivative liabilities | 4,850 | 12,415 |
Cash flow hedging | ||
Derivative liabilities: | ||
Total derivative liabilities | 4,850 | 4,281 |
Cash flow hedging | Accrued liabilities | Natural gas swaps | ||
Derivative liabilities: | ||
Total derivative liabilities | 688 | 813 |
Cash flow hedging | Accrued liabilities | Interest rate caps | ||
Derivative liabilities: | ||
Total derivative liabilities | 1,636 | 420 |
Cash flow hedging | Other long-term liabilities | Natural gas swaps | ||
Derivative liabilities: | ||
Total derivative liabilities | 1 | 226 |
Cash flow hedging | Other long-term liabilities | Interest rate caps | ||
Derivative liabilities: | ||
Total derivative liabilities | 2,525 | 2,822 |
Cash flow hedging | Other long-term liabilities | Cross-currency interest rate swaps | ||
Derivative liabilities: | ||
Total derivative liabilities | 0 | 8,134 |
Net investment hedging | Prepaid and other current assets | Cross-currency interest rate swaps | ||
Derivative assets: | ||
Total derivative assets | 3,992 | 3,928 |
Net investment hedging | Other long-term assets | Cross-currency interest rate swaps | ||
Derivative assets: | ||
Total derivative assets | $ 1,405 | $ 0 |
Effect on Other Comprehensive I
Effect on Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Amount of gain (loss) recognized in OCI on derivatives | ||||
Amount of gain (loss) recognized in OCI on derivatives | $ (127) | $ (1,812) | $ (1,437) | $ (3,814) |
Amount of gain (loss) reclassified from AOCI into income | ||||
Amount of gain (loss) reclassified from AOCI into income | (787) | (256) | (1,391) | (188) |
Interest rate caps | ||||
Amount of gain (loss) recognized in OCI on derivatives | ||||
Amount of gain (loss) recognized in OCI on derivatives | (325) | (675) | (920) | (3,048) |
Interest rate caps | Interest expense | ||||
Amount of gain (loss) reclassified from AOCI into income | ||||
Amount of gain (loss) reclassified from AOCI into income | (293) | (169) | (524) | (292) |
Natural gas swaps | ||||
Amount of gain (loss) recognized in OCI on derivatives | ||||
Amount of gain (loss) recognized in OCI on derivatives | 198 | (1,137) | (517) | (766) |
Natural gas swaps | Cost of goods sold | ||||
Amount of gain (loss) reclassified from AOCI into income | ||||
Amount of gain (loss) reclassified from AOCI into income | $ (494) | $ (87) | $ (867) | $ 104 |
Cash Flow Hedge Impact on Incom
Cash Flow Hedge Impact on Income Statement (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Derivative | ||||
Cost of goods sold | $ (266,686) | $ (316,180) | $ (539,685) | $ (594,491) |
Interest Expense | (22,275) | (28,540) | (46,730) | (57,158) |
Gain (loss) on cash flow hedging relationships | Amount of gain (loss) reclassified from AOCI into income | ||||
Derivative | ||||
Cost of goods sold | (494) | (87) | (867) | 104 |
Interest Expense | $ (293) | $ (169) | $ (524) | $ (292) |
Net Investment Hedge Impact on
Net Investment Hedge Impact on AOCI (Details) - Cross-currency interest rate swaps - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Derivative | ||||
Amount of gain (loss) recognized in OCI on derivative | $ (5,206) | $ (2,613) | $ 9,603 | $ 5,940 |
Gain (loss) on sale of subsidiary | ||||
Derivative | ||||
Amount of gain (loss) reclassified from AOCI into income | 0 | 0 | 0 | 0 |
Interest (expense) income | ||||
Derivative | ||||
Amount of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) | $ 1,552 | $ 2,465 | $ 3,244 | $ 3,912 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 50.00% | 39.80% | 51.40% | 40.00% |
Net Periodic Pension Expense Be
Net Periodic Pension Expense Benefit (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Defined Benefit Pension Plans | U.S. | ||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) | ||||
Service cost | $ 192 | $ 281 | $ 384 | $ 500 |
Interest cost | 2,152 | 2,798 | 4,304 | 5,305 |
Expected return on plan assets | (3,331) | (3,064) | (6,662) | (5,821) |
Amortization of net (gain) loss | 0 | 0 | 0 | 0 |
Amortization of prior service cost (credit) | 0 | 0 | 0 | 0 |
Defined benefit pension plan (benefit) cost | (987) | 15 | (1,974) | (16) |
Defined Benefit Pension Plans | Foreign | ||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) | ||||
Service cost | 997 | 878 | 1,994 | 1,684 |
Interest cost | 707 | 824 | 1,414 | 1,657 |
Expected return on plan assets | (810) | (990) | (1,620) | (1,593) |
Amortization of net (gain) loss | 41 | 0 | 82 | 0 |
Amortization of prior service cost (credit) | 6 | 12 | 12 | 12 |
Defined benefit pension plan (benefit) cost | 941 | 724 | 1,882 | 1,760 |
Supplemental Retirement Plans | ||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) | ||||
Interest cost | 86 | 122 | 172 | 243 |
Defined benefit pension plan (benefit) cost | 86 | 122 | 172 | 243 |
Other Postretirement Benefits Plans | ||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) | ||||
Service cost | 0 | 4 | 0 | 7 |
Interest cost | 24 | 38 | 48 | 76 |
Amortization of net (gain) loss | (7) | (9) | (14) | (18) |
Amortization of prior service cost (credit) | (58) | (33) | (116) | (65) |
Defined benefit pension plan (benefit) cost | $ (41) | $ 0 | $ (82) | $ 0 |
Summary Financial Information b
Summary Financial Information by Reportable Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Segment Reporting | ||||
Sales | $ 359,525 | $ 431,675 | $ 721,123 | $ 790,896 |
Equity in net income | 11,492 | 12,300 | 19,842 | 14,364 |
Refining Services | ||||
Segment Reporting | ||||
Sales | 89,652 | 116,395 | 189,418 | 221,352 |
Catalysts | ||||
Segment Reporting | ||||
Sales | 25,206 | 21,071 | 50,023 | 36,661 |
Performance Materials | ||||
Segment Reporting | ||||
Sales | 104,149 | 118,768 | 169,663 | 179,809 |
Performance Chemicals | ||||
Segment Reporting | ||||
Sales | 140,518 | 175,441 | 312,019 | 353,074 |
Operating segments | ||||
Segment Reporting | ||||
Sales | 362,484 | 434,847 | 727,887 | 798,108 |
Segment Adjusted EBITDA | 121,625 | 142,817 | 235,456 | 253,863 |
Operating segments | Refining Services | ||||
Segment Reporting | ||||
Sales | 90,432 | 117,290 | 191,123 | 223,134 |
Segment Adjusted EBITDA | 34,996 | 42,824 | 72,179 | 82,555 |
Operating segments | Catalysts | ||||
Segment Reporting | ||||
Sales | 25,208 | 20,857 | 50,072 | 36,723 |
Segment Adjusted EBITDA | 25,312 | 29,607 | 47,979 | 47,734 |
Operating segments | Performance Materials | ||||
Segment Reporting | ||||
Sales | 104,203 | 118,872 | 169,772 | 179,961 |
Segment Adjusted EBITDA | 27,306 | 29,221 | 40,813 | 39,736 |
Operating segments | Performance Chemicals | ||||
Segment Reporting | ||||
Sales | 142,641 | 177,828 | 316,920 | 358,290 |
Segment Adjusted EBITDA | 34,011 | 41,165 | 74,485 | 83,838 |
Eliminations | ||||
Segment Reporting | ||||
Sales | (2,959) | (3,172) | (6,764) | (7,212) |
Zeolyst Joint Venture | Catalysts | ||||
Segment Reporting | ||||
Sales | 40,852 | 39,124 | 73,143 | 68,602 |
Segment Adjusted EBITDA | 16,855 | 17,636 | 30,580 | 25,993 |
Equity in net income | 11,489 | 12,264 | 19,806 | 14,300 |
Amortization of investment in affiliate step-up | 1,659 | 1,659 | 3,317 | 4,217 |
Joint venture depreciation, amortization and interest | $ 3,707 | $ 3,713 | $ 7,457 | $ 7,476 |
Reconciliation of Net Income to
Reconciliation of Net Income to Segment Adjusted EBITDA (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Segment Reporting Information | ||||
Net income attributable to PQ Group Holdings Inc. | $ 15,926 | $ 30,574 | $ 16,150 | $ 33,725 |
Provision for income taxes | 16,262 | 20,307 | 17,689 | 22,754 |
Interest expense, net | 22,275 | 28,540 | 46,730 | 57,158 |
Depreciation and amortization | 44,822 | 45,090 | 90,493 | 90,984 |
Debt extinguishment costs | 0 | 0 | (2,513) | 0 |
Net (gain) loss on asset disposals | (1,020) | (9,659) | 8,401 | (8,839) |
Foreign currency exchange (gain) loss | 2,483 | 923 | ||
Transaction and other related costs | 775 | 943 | 2,644 | 1,008 |
Corporate, non-segment | ||||
Segment Reporting Information | ||||
Unallocated corporate expenses | 8,588 | 10,364 | 19,276 | 20,369 |
Segment reconciling items | ||||
Segment Reporting Information | ||||
Joint venture depreciation, amortization and interest | 3,708 | 3,713 | 7,457 | 7,476 |
Amortization of investment in affiliate step-up | 1,659 | 1,659 | 3,317 | 4,217 |
Debt extinguishment costs | 0 | 0 | 2,513 | 0 |
Net (gain) loss on asset disposals | (1,020) | (9,653) | 8,401 | (8,833) |
Foreign currency exchange (gain) loss | (854) | 3,612 | 2,483 | 923 |
LIFO expense | (1,469) | 122 | (1,798) | 10,280 |
Transaction and other related costs | 739 | 975 | 2,801 | 1,055 |
Equity-based compensation | 6,366 | 5,370 | 12,286 | 8,770 |
Restructuring, integration and business optimization expenses | 3,591 | (13) | 5,620 | 719 |
Defined benefit pension plan (benefit) cost | (252) | 552 | (500) | 1,545 |
Other | 1,284 | 1,605 | 2,538 | 2,721 |
Operating segments | ||||
Segment Reporting Information | ||||
Segment EBITDA | 99,285 | 124,511 | 171,062 | 204,621 |
Adjusted Earnings Before Interest Taxes Depreciation And Amortization | 113,037 | 132,453 | 216,180 | 233,494 |
Segment Adjusted EBITDA | $ 121,625 | $ 142,817 | $ 235,456 | $ 253,863 |
Stock-Based Compensation Narrat
Stock-Based Compensation Narrative (Details) - USD ($) $ in Thousands | Apr. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 |
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Stock-based compensation expense | $ 6,366 | $ 5,370 | $ 12,286 | $ 8,770 | |
Stock-based compensation expense, tax benefit | $ 1,577 | $ 1,326 | $ 3,044 | $ 2,166 | |
Number of shares available for grant (shares) | 12,174,223 | 12,174,223 | |||
Number of additional shares authorized | 9,000,000 | ||||
Number of restricted stock awards forfeit | 560,381 | ||||
Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Granted | 1,158,605 | ||||
Unrecognized stock-based compensation expense | $ 26,601 | $ 26,601 | |||
Unrecognized stock-based compensation expense, period for recognition | 1 year 9 months 14 days | ||||
Performance Stock Units (PSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Granted | 456,311 | ||||
Award vesting period | 3 years | ||||
Unrecognized stock-based compensation expense | $ 12,314 | $ 12,314 | |||
Unrecognized stock-based compensation expense, period for recognition | 2 years 1 month 20 days | ||||
Performance Stock Units (PSUs) | Total Shareholder Return [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Award vesting percentage | 50.00% | ||||
Performance Stock Units (PSUs) | Financial Performance Target [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Award vesting percentage | 50.00% | ||||
Director | Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Award vesting period | 1 year | ||||
Employee | Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Award vesting period | 3 years | ||||
Minimum | Performance Stock Units (PSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Award vesting percentage | 0.00% | ||||
Maximum | Performance Stock Units (PSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Award vesting percentage | 200.00% |
Performance Stock Units Assumpt
Performance Stock Units Assumptions and Methodology (Details) - Performance Stock Units (PSUs) | 6 Months Ended |
Jun. 30, 2020$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | |
Expected dividend yield | 0.00% |
Risk-free interest rate | 1.56% |
Expected volatility | 28.57% |
Expected term (in years) | 2 years 11 months 12 days |
Grant date fair value | $ 24.11 |
Schedule of RSU and PSU Activit
Schedule of RSU and PSU Activity (Details) | 6 Months Ended |
Jun. 30, 2020$ / sharesshares | |
Restricted Stock Units (RSUs) | |
Number of Units | |
Nonvested, beginning balance | shares | 1,628,436 |
Granted | shares | 1,158,605 |
Vested | shares | (441,760) |
Forfeited | shares | (99,667) |
Nonvested, ending balance | shares | 2,245,614 |
Weighted Average Grant Date Fair Value (per share) | |
Weighted average grant date fair value, nonvested, beginning balance | $ / shares | $ 15.83 |
Weighted average grant date fair value, granted | $ / shares | 16.60 |
Weighted average grant date fair value, vested | $ / shares | 15.43 |
Weighted average grant date fair value, forfeited | $ / shares | 16.30 |
Weighted average grant date fair value, nonvested, ending balance | $ / shares | $ 16.29 |
Performance Stock Units (PSUs) | |
Number of Units | |
Nonvested, beginning balance | shares | 550,676 |
Granted | shares | 456,311 |
Vested | shares | 0 |
Forfeited | shares | (31,069) |
Nonvested, ending balance | shares | 975,918 |
Weighted Average Grant Date Fair Value (per share) | |
Weighted average grant date fair value, nonvested, beginning balance | $ / shares | $ 15.41 |
Weighted average grant date fair value, granted | $ / shares | 20.38 |
Weighted average grant date fair value, vested | $ / shares | 0 |
Weighted average grant date fair value, forfeited | $ / shares | 15.41 |
Weighted average grant date fair value, nonvested, ending balance | $ / shares | $ 17.74 |
Reconciliation from Basic to Di
Reconciliation from Basic to Diluted Weighted Average Shares Outstanding (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Earnings Per Share [Abstract] | ||||
Weighted average shares outstanding – Basic (shares) | 135,083,126 | 134,142,552 | 135,278,764 | 134,044,972 |
Dilutive effect of unvested common shares and restricted stock units with service conditions, performance stock units considered probable of vesting and assumed stock option exercises and conversions (shares) | 588,704 | 1,180,472 | 800,776 | 1,062,035 |
Weighted average shares outstanding – Diluted (shares) | 135,671,830 | 135,323,024 | 136,079,540 | 135,107,007 |
Calculation of Basic and Dilute
Calculation of Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Numerator: | ||||
Net income attributable to PQ Group Holdings Inc. | $ 15,926 | $ 30,574 | $ 16,150 | $ 33,725 |
Denominator: | ||||
Weighted average shares outstanding – Basic (shares) | 135,083,126 | 134,142,552 | 135,278,764 | 134,044,972 |
Weighted average shares outstanding – Diluted (shares) | 135,671,830 | 135,323,024 | 136,079,540 | 135,107,007 |
Net income per share: | ||||
Basic income per share (usd per share) | $ 0.12 | $ 0.23 | $ 0.12 | $ 0.25 |
Diluted income per share (usd per share) | $ 0.12 | $ 0.23 | $ 0.12 | $ 0.25 |
Anti-dilutive Shares (Details)
Anti-dilutive Shares (Details) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Restricted stock awards with performance only targets not yet achieved | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive (shares) | 1,507,366 | 1,637,134 | 1,511,868 | 1,638,318 |
Stock options with performance only targets not yet achieved | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive (shares) | 509,888 | 586,253 | 516,110 | 586,253 |
Anti-dilutive restricted stock awards, restricted stock units and performance stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive (shares) | 2,262,974 | 0 | 1,421,401 | 2,012 |
Anti-dilutive stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive (shares) | 844,475 | 863,063 | 847,641 | 863,063 |
Anti-dilutive stock options | $16.97 (usd per share) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive (shares) | 603,159 | 621,747 | 606,325 | 621,747 |
Exercise price (usd per share) | $ 16.97 | $ 16.97 | $ 16.97 | $ 16.97 |
Anti-dilutive stock options | $17.50 (usd per share) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive (shares) | 241,316 | 241,316 | 241,316 | 241,316 |
Exercise price (usd per share) | $ 17.50 | $ 17.50 | $ 17.50 | $ 17.50 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Cash paid during the period for: | ||
Income taxes, net of refunds | $ 14,436 | $ 8,301 |
Interest | 54,248 | 59,035 |
Net interest proceeds on swaps designated as net investment hedges | 2,197 | 4,478 |
Non-cash investing activity: | ||
Capital expenditures acquired on account but unpaid as of the period end | 6,716 | 10,405 |
Right-of-use assets obtained in exchange for new lease liabilities (non-cash): | ||
Operating leases | $ 3,641 | $ 1,566 |
Cash and Restricted Cash Reconc
Cash and Restricted Cash Reconciliation (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Restricted Cash [Abstract] | ||||
Cash and cash equivalents | $ 88,640 | $ 72,284 | $ 82,200 | |
Restricted cash included in prepaid and other current assets | 1,948 | 1,759 | ||
Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows | $ 90,588 | $ 73,917 | $ 83,959 | $ 59,726 |
Restricted cash, balance sheet line item | us-gaap:PrepaidExpenseAndOtherAssetsCurrent |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event $ in Thousands | Jul. 31, 2020USD ($) |
July 2020 Interest Rate Cap [Member] | Cash flow hedging | |
Subsequent Event [Line Items] | |
Derivative, notional amount | $ 400,000 |
Disposal group, disposed of by sale, not discontinued operations | Magnesium Silicate Product Line [Member] | |
Subsequent Event [Line Items] | |
Consideration for sale of product line | $ 18,000 |