Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | Apr. 30, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | BALL CORP | |
Entity Central Index Key | 9,389 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 175,577,956 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS | ||
Net sales | $ 2,473 | $ 1,756 |
Costs and expenses | ||
Cost of sales (excluding depreciation and amortization) | (1,975) | (1,416) |
Depreciation and amortization | (148) | (75) |
Selling, general and administrative | (143) | (108) |
Business consolidation and other activities | (55) | (267) |
Total costs and expenses | (2,321) | (1,866) |
Earnings (loss) before interest and taxes | 152 | (110) |
Interest expense | (68) | (38) |
Debt refinancing and other costs | (61) | |
Total interest expense | (68) | (99) |
Earnings (loss) before taxes | 84 | (209) |
Tax (provision) benefit | (22) | 83 |
Equity in results of affiliates, net of tax | 8 | (1) |
Net earnings (loss) | 70 | (127) |
Less net earnings attributable to noncontrolling interests | (2) | |
Net earnings (loss) attributable to Ball Corporation | $ 68 | $ (127) |
Earnings (loss) per share: | ||
Basic (in dollars per share) | $ 0.39 | $ (0.90) |
Diluted (in dollars per share) | $ 0.38 | $ (0.90) |
Weighted average shares outstanding (000s): | ||
Basic (in shares) | 175,024 | 141,793 |
Diluted (in shares) | 178,967 | 141,793 |
UNAUDITED CONDENSED CONSOLIDAT3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (LOSS) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (LOSS) | ||
Net earnings (loss) | $ 70 | $ (127) |
Other comprehensive earnings (loss): | ||
Foreign currency translation adjustment | 69 | 28 |
Pension and other postretirement benefits | 6 | 6 |
Effective financial derivatives | 64 | |
Total other comprehensive earnings (loss) | 139 | 34 |
Income tax (provision) benefit | (11) | (3) |
Total other comprehensive earnings (loss), net of tax | 128 | 31 |
Total comprehensive earnings (loss) | 198 | (96) |
Less comprehensive (earnings) loss attributable to noncontrolling interests | (2) | |
Comprehensive earnings (loss) attributable to Ball Corporation | $ 196 | $ (96) |
UNAUDITED CONDENSED CONSOLIDAT4
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets | ||||
Cash and cash equivalents | $ 458 | $ 597 | $ 205 | $ 224 |
Receivables, net | 1,695 | 1,491 | ||
Inventories, net | 1,554 | 1,413 | ||
Other current assets | 200 | 152 | ||
Total current assets | 3,907 | 3,653 | ||
Noncurrent assets | ||||
Property, plant and equipment, net | 4,403 | 4,387 | ||
Goodwill | 5,152 | 5,095 | ||
Intangible assets, net | 1,917 | 1,934 | ||
Other assets | 1,265 | 1,104 | ||
Total assets | 16,644 | 16,173 | ||
Current liabilities | ||||
Short-term debt and current portion of long-term debt | 497 | 222 | ||
Accounts payable | 1,830 | 2,033 | ||
Accrued employee costs | 264 | 315 | ||
Other current liabilities | 427 | 399 | ||
Total current liabilities | 3,018 | 2,969 | ||
Noncurrent liabilities | ||||
Long-term debt | 7,476 | 7,310 | ||
Employee benefit obligations | 1,487 | 1,497 | ||
Deferred taxes | 855 | 759 | ||
Other liabilities | 85 | 97 | ||
Total liabilities | 12,921 | 12,632 | ||
Shareholders' equity | ||||
Common stock (334,660,441 shares issued - 2017; 334,252,175 shares issued - 2016) | 1,040 | 1,038 | ||
Retained earnings | 4,784 | 4,739 | ||
Accumulated other comprehensive earnings (loss) | (813) | (941) | ||
Treasury stock, at cost ( 159,240,073 shares - 2017; 159,387,049 shares - 2016) | (1,392) | (1,401) | ||
Total Ball Corporation shareholders' equity | 3,619 | 3,435 | ||
Noncontrolling interests | 104 | 106 | ||
Total shareholders' equity | 3,723 | 3,541 | ||
Total liabilities and shareholders' equity | $ 16,644 | $ 16,173 |
UNAUDITED CONDENSED CONSOLIDAT5
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares | Mar. 31, 2017 | Dec. 31, 2016 |
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common stock, shares issued | 334,660,441 | 334,252,175 |
Treasury stock, common shares | 159,240,073 | 159,387,049 |
UNAUDITED CONDENSED CONSOLIDAT6
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Cash Flows from Operating Activities | |||
Net earnings (loss) | $ 70 | $ (127) | |
Adjustments to reconcile net earnings (loss) to cash provided by (used in) continuing operating activities: | |||
Depreciation and amortization | 148 | 75 | |
Business consolidation and other activities | 55 | 267 | |
Deferred tax provision (benefit) | 2 | (50) | |
Other, net | 7 | 10 | |
Changes in working capital components | [1] | (680) | (561) |
Cash provided by (used in) operating activities | (398) | (386) | |
Cash Flows from Investing Activities | |||
Capital expenditures | (125) | (138) | |
Business acquisitions, net of cash acquired | (36) | ||
Business dispositions, net of cash sold | 31 | ||
Other, net | 3 | (11) | |
Cash provided by (used in) investing activities | (91) | (185) | |
Cash Flows from Financing Activities | |||
Long-term borrowings | 185 | 801 | |
Repayments of long-term borrowings | (50) | (407) | |
Net change in short-term borrowings | 273 | 310 | |
Proceeds from issuances of common stock, net of shares used for taxes | (1) | 7 | |
Acquisitions of treasury stock | (3) | (98) | |
Common dividends | (23) | (19) | |
Other, net | (1) | (22) | |
Cash provided by (used in) financing activities | 380 | 572 | |
Effect of exchange rate changes on cash | (30) | (20) | |
Change in cash and cash equivalents | (139) | (19) | |
Cash and cash equivalents - beginning of period | 597 | 224 | |
Cash and cash equivalents - end of period | $ 458 | $ 205 | |
[1] | Includes payments of costs associated with the acquisition of Rexam and the sale of the Divestment Business. |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2017 | |
Basis of Presentation | |
Basis of Presentation | 1. Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of Ball Corporation and its controlled affiliates, including its consolidated variable interest entities (collectively Ball, the company, we or our), have been prepared by the company. Certain information and footnote disclosures, including critical and significant accounting policies normally included in financial statements prepared in accordance with generally accepted accounting principles, have been condensed or omitted for this quarterly presentation. Results of operations for the periods shown are not necessarily indicative of results for the year, particularly in view of the seasonality in the packaging segments, the variability of contract revenues in the company’s aerospace segment, the acquisition of Rexam PLC (Rexam) and the divestiture of certain assets and liabilities of the combined business on June 30, 2016. These unaudited condensed consolidated financial statements and accompanying notes should be read in conjunction with the consolidated financial statements and the notes thereto included in the company’s Annual Report on Form 10-K filed on March 2, 2017, pursuant to Section 13 of the Securities Exchange Act of 1934 for the fiscal year ended December 31, 2016 (annual report). The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires Ball’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting periods. These estimates are based on historical experience and various assumptions believed to be reasonable under the circumstances. Ball’s management evaluates these estimates on an ongoing basis and adjusts or revises the estimates as circumstances change. As future events and their impacts cannot be determined with precision, actual results may differ from these estimates. In the opinion of management, the financial statements reflect all adjustments necessary to fairly state the results of the periods presented. Certain prior period amounts have been reclassified in order to conform to the current period presentation. |
Accounting Pronouncements
Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Pronouncements | |
Accounting Pronouncements | 2. Accounting Pronouncements Recently Adopted Accounting Standards In January 2017, amendments to existing accounting guidance were issued simplifying an entity’s subsequent goodwill measurement by eliminating Step 2, which requires a hypothetical purchase price allocation, from its annual or interim goodwill impairment test. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. This guidance is required to be applied prospectively on January 1, 2020, and early adoption is permitted. The company elected to early adopt this guidance effective January 1, 2017, and it did not have a material impact on the company’s unaudited condensed consolidated financial statements. In March 2016, final accounting guidance was issued clarifying that the assessment of whether an embedded contingent put or call option is clearly and closely related to the debt host only requires an analysis of the four-step decision sequence outlined in the accounting standards codification. Consequently, when a contingent put or call option embedded in a debt instrument would be evaluated for possible separate accounting as a derivative instrument, the nature of the exercise contingency would be disregarded. This guidance was applied on a modified retrospective basis on January 1, 2017, and did not have an effect on the company’s unaudited condensed consolidated financial statements. In March 2016, final accounting guidance was issued eliminating the requirement to retrospectively apply the equity method in previous periods when an investor initially obtains significant influence over an investee. The new guidance requires the investor to apply the equity method prospectively from the date the investment qualifies for the equity method. The investor will add the carrying value of the existing investment to the cost of the additional investment to determine the initial cost basis of the equity method investment. This guidance was applied prospectively on January 1, 2017, and did not have a material effect on the company’s unaudited condensed consolidated financial statements. In March 2016, amendments to existing accounting guidance were issued to simplify various aspects related to how share-based payments are accounted for and presented in the consolidated financial statements. The company adopted these amendments on January 1, 2017, as discussed below, which did not have a material effect on the company’s unaudited condensed consolidated financial statements. · All excess tax benefits and tax deficiencies that were previously recognized in common stock are now recognized as income tax provisions (benefits) in the income statement as a discrete item. As required, this change was applied prospectively for settlements occurring after the adoption of the guidance on January 1, 2017. · Any prior period excess tax benefits that did not reduce taxes payable in the period in which they arose were required to be recorded on a modified retrospective basis, with a cumulative effect adjustment to opening retained earnings. However, the company was able to reduce taxes payable for all previous excess tax benefits and, therefore, was not required to record a cumulative effect adjustment. · The company has elected to use a prospective approach to report all tax related cash flows resulting from share-based payments as operating activities on the statement of cash flows and, therefore, no adjustments have been made to prior periods. Previously, excess tax benefits were reported as part of financing activities. · The company has elected to account for forfeitures as they occur. No cumulative effect adjustment was required as the amount calculated was immaterial. In March 2016, accounting guidance was issued on the effect of derivative contract novations on existing hedge accounting relationships. The amendments clarify that a change in the counterparty to a derivative instrument designated as a hedging instrument does not in and of itself require dedesignation of that hedging relationship, provided that all other hedge accounting criteria continue to be met. The guidance was applied prospectively on January 1, 2017, and did not have a material effect on the company’s unaudited condensed consolidated financial statements. New Accounting Guidance In March 2017, amendments to existing guidance were issued to improve the presentation of net periodic pension cost and net periodic postretirement benefit cost, which requires employers to report the service cost component in the same line item as other compensation costs arising from services rendered by the associated employees during the period. The other components of net periodic pension and benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. The amendments also permit only the service cost component of net benefit cost to be eligible for capitalization. This guidance is required to be applied retrospectively for the presentation of the service cost component and the other components of net periodic pension cost and net periodic postretirement benefit cost in the income statement, and prospectively for the capitalization of the service cost component. Employers can elect a practical expedient that permits use of the amounts disclosed in its pension footnote for the prior comparative periods as the estimation basis for applying the retrospective presentation requirements. The guidance is effective for Ball on January 1, 2018, and early adoption is permitted. The company has not elected to early adopt the new standard and is currently assessing the impact this guidance will have on its consolidated financial statements. In February 2017, amendments to existing guidance were issued to clarify the scope of ASC Subtopic 610-20, Other Income-Gains and Losses from the Derecognition of Nonfinancial Assets and to add guidance for partial sales of nonfinancial assets. The guidance requires that all entities account for the derecognition of a business in accordance with ASC 810, including instances in which the business is considered in substance real estate. This guidance is required to be applied on January 1, 2018, using a full retrospective approach or a modified retrospective approach and early adoption is permitted. The company is currently assessing the impact that the adoption of this new guidance will have on its consolidated financial statements . In January 2017, amendments to existing guidance were issued to further clarify the definition of a business in determining whether or not a company has acquired or sold a business. The amendments provide a screen to determine when an integrated set of assets and activities (collectively referred to as a “set”) is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. If the screen is not met, the amendments in this update (1) require that to be considered a business, a set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output and (2) remove the evaluation of whether a market participant could replace missing elements. The amendments also narrow the definition of the term “output” so that the term is consistent with how outputs are described in Topic 606. The guidance is required to be applied prospectively for Ball on January 1, 2018, and early adoption is permitted. The company does not expect the amendments to have a material impact on its consolidated financial statements and the company has not elected to early adopt this new accounting standard. In November 2016, accounting guidance was issued that will require the statement of cash flows to explain the change in the total of cash, cash equivalents and restricted cash or restricted cash equivalents. In addition, restricted cash and restricted cash equivalents will need to be included in a cash reconciliation of beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This guidance is required to be applied retrospectively on January 1, 2018. The company is currently assessing the impact that the adoption of this new guidance will have on its consolidated financial statements . In October 2016, amendments to existing guidance were issued that will require entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory, when the transfer occurs as opposed to when the asset is sold. The amendments also eliminate the exception for an intra-entity transfer of an asset other than inventory. This guidance is required to be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings on January 1, 2018. The company is currently assessing the impact that the adoption of this new guidance will have on its consolidated financial statements . In August 2016, accounting guidance was issued addressing the following eight specific cash flow issues: · Debt prepayment or debt extinguishment costs · Settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing · Contingent consideration payments made after a business combination · Proceeds from the settlement of insurance claims · Proceeds from the settlement of corporate-owned life insurance policies (including bank-owned life insurance policies) · Distributions received from equity method investees · Beneficial interests in securitization transactions · Separately identifiable cash flows and application of the predominance principle This guidance is required to be applied retrospectively on January 1, 2018. The company is currently assessing the impact that the adoption of this new guidance will have on its consolidated financial statements. In June 2016, amendments requiring financial assets or a group of financial assets measured at amortized cost basis to be presented at the net amount expected to be collected were finalized. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset to present the net carrying value at the amount expected to be collected on the financial asset. This guidance affects loans, debt securities, trade receivables, net investments in leases, off-balance-sheet credit exposures, reinsurance receivables and any other financial assets not excluded from the scope that have the contractual right to receive cash. The guidance will be effective on January 1, 2020. The company is currently assessing the impact the adoption of this standard will have on its consolidated financial statements. In February 2016, lease accounting guidance was issued which, for operating leases, requires a lessee to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in its balance sheet. The guidance also requires a lessee to recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, generally on a straight-line basis. The guidance will be effective for Ball on January 1, 2019. The company is currently assessing the impact the adoption of this standard will have on its consolidated financial statements and expects a material amount of assets and liabilities to be recorded in the consolidated balance sheet. In January 2016, accounting guidance was issued on the classification and measurement of financial assets and liabilities (equity securities and financial liabilities) under the fair value option, and the presentation and disclosure requirements for financial instruments. The guidance modifies how entities measure equity investments and present changes in the fair value of financial liabilities. Under the new guidance, entities will have to measure equity investments that do not result in consolidation and are not accounted under the equity method at fair value and recognize any changes in fair value in net income unless the investments qualify for the new practicality exception. An exception will apply to those equity investments that do not have a readily determinable fair value and do not qualify for the practical expedient to estimate fair value under the guidance and, as such, these investments may be measured at cost. The guidance will be effective on January 1, 2018. The company is currently assessing the impact that the adoption of this new guidance will have on its consolidated financial statements. New Revenue Guidance In May 2014, the Financial Accounting Standards Board (FASB) and International Accounting Standards Board jointly issued new revenue recognition guidance which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. The new guidance contains a more robust framework for addressing revenue issues and is intended to remove inconsistencies in existing guidance and improve comparability of revenue recognition practices across entities, industries, jurisdictions and capital markets. Under the new standard, revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In July 2015, the FASB approved the deferral of the effective date of the new revenue recognition guidance by one year. The new standard is effective for annual reporting periods beginning after December 15, 2017. In March 2016, the principal versus agent guidance within the new revenue recognition standard was amended to clarify how an entity should identify the unit of accounting for the principal versus agent evaluation. The new standard requires an entity to determine whether it is a principal or an agent in a transaction in which another party is involved in providing goods or services to a customer, by evaluating the nature of its promise to the customer. An entity is a principal and records revenue on a gross basis if it controls the promised good or service before transferring the good or service to the customer. An entity is an agent and records as revenue the net amount it retains for its agency services if its role is to arrange for another entity to provide the goods or services. In May 2016, narrow scope amendments and practical expedients were issued to clarify the new revenue recognition standard. The amendments clarify the collectability criterion of the revenue standard wherein an entity is allowed to recognize revenue in the amount of consideration received when the following criteria are met: the entity has transferred control of the goods or services, the entity has stopped transferring goods or services, or has no obligation under the contract to transfer additional goods or services, and the consideration received from the customer is nonrefundable. The amendments also clarify the following: the fair value of noncash consideration be measured at contract inception when determining the transaction price, allows an entity to make an accounting policy election to exclude from the transaction price certain types of taxes collected from a customer when the company discloses that policy, for contracts to be considered completed at transition, all (or substantially all) of the revenue must have been recognized under legacy GAAP, and a practical expedient is provided in which an entity can avoid having to evaluate the effects of each contract modification from contract inception through the beginning of the earliest period presented when accounting for contracts that were modified prior to adoption under both the full and modified retrospective transition approach. In December 2016, technical corrections and improvements were issued on a variety of topics within the new revenue recognition standard. The corrections represent minor corrections or improvements and are not expected to have a significant impact on accounting practices. The amendments clarify the following: guarantee fees within the scope of Topic 460 are not within the scope of Topic 606, impairment testing for capitalized contract costs should consider both expected contract renewals and extensions and unrecognized consideration already received along with expected future consideration, the sequence of impairment testing for assets within the scope of different Topics, allowance of an accounting policy election to determine the provision for losses at the performance obligation level instead of the contract level, exclude all topics within Topic 944 from the scope of Topic 606, allow exemptions from the disclosures of remaining performance obligations, disclosure of prior-period performance obligations pertains to all performance obligations and is not limited to those with corresponding contract balances, and better aligns accounting guidance and examples within the guidance. The guidance will be effective for Ball on January 1, 2018, and will supersede the current revenue recognition guidance, including industry-specific guidance. While early adoption is permitted, entities are not permitted to adopt the standard earlier than the original effective date of January 1, 2017. Entities have the option of using either a full retrospective or modified retrospective approach for the adoption of the standard. We currently anticipate adopting the standard on January 1, 2018, using the modified retrospective method. We established a cross-functional implementation team, which includes representatives from all of our business segments. We utilized a bottoms-up approach to analyze the impact of the new standard on our contracts with customers by reviewing our current accounting policies and practices to identify potential differences that would result from applying the requirements of the new standard to revenues arising from such contracts. In addition, we are in the process of identifying the appropriate changes to our business processes, systems and controls to support recognition and disclosure under the standard upon adoption. While we are continuing to assess all potential impacts of the new standard, we currently believe the most significant impact will be in the way we account for revenue in our metal beverage packaging segments, and to a lesser extent in our food and aerosol packaging segment. We currently recognize revenue from many of our contracts in these segments when the four established criteria of revenue recognition under the current guidance have been met, generally occurring upon shipment or delivery of goods. Under the new standard we expect we will be required to recognize revenue from many of these contracts over time, which will accelerate the timing of revenue recognition from these arrangements, such that some portion of revenue will be recognized prior to shipment or delivery of goods. In addition to accelerating the timing of recording revenue, we expect corresponding decreases in inventories with an offsetting increase to unbilled receivables to the extent the amounts have not yet been invoiced to the customer. Relative to the aerospace segment, at this time we do not expect the implementation of the new standard to materially impact the manner in which we currently recognize revenue in this segment as the standard supports the recognition of revenue over time under the “cost-to-cost” method, which is consistent with the current revenue recognition model utilized for the majority of our contracts in this segment. We expect revenue arising from the majority of our contracts to continue to be recognized over time because of the continuous transfer of control to the customer. However due to the complexity of most of our aerospace contracts, the actual revenue recognition treatment required under the new standard will be dependent on contract-specific terms, and may vary in some instances from recognition over time. Finally, we are still evaluating performance obligations under the new standard as compared with deliverables and separate units of account previously identified. The results of this evaluation may impact the timing of revenue recognition across all of our business segments. We are complete with our initial impact assessment, which is based on a review of sample contracts representative of the range of our existing contracts. During 2017, Ball will continue to finalize the initial impact assessment and design and implement changes to processes, systems and internal controls to be in a position to report under the new accounting standard upon adoption in the first quarter of 2018. |
Business Segment Information
Business Segment Information | 3 Months Ended |
Mar. 31, 2017 | |
Business Segment Information | |
Business Segment Information | 3. Business Segment Information During the third quarter of 2016, Ball made certain segment realignments as a result of the Rexam acquisition and sale of Ball’s existing beverage packaging businesses and select beverage can assets of Rexam (the Divestment Business) to align with how Ball now manages its businesses. Ball has retrospectively adjusted prior period amounts to conform to the current segment presentation. Ball’s operations are organized and reviewed by management along its product lines and geographical areas and presented in the five reportable segments outlined below: Beverage packaging, North and Central America : Consists of operations in the U.S., Canada and Mexico that manufacture and sell metal beverage containers. Beverage packaging, South America : Consists of operations in Brazil, Argentina and Chile that manufacture and sell metal beverage containers. Beverage packaging, Europe : Consists of operations in numerous countries in Europe, including Russia, that manufacture and sell metal beverage containers. Food and aerosol packaging : Consists of operations in the U.S., Europe, Canada, Mexico, Argentina and India that manufacture and sell steel food and aerosol containers, extruded aluminum aerosol containers and aluminum slugs. Aerospace : Consists of operations that manufacture and sell aerospace and other related products and provide services used in the defense, civil space and commercial space industries. Other consists of non-reportable segments in Asia Pacific and AMEA that manufacture and sell metal beverage containers, undistributed corporate expenses, intercompany eliminations and other business activities. The accounting policies of the segments are the same as those in the consolidated financial statements and are discussed in Note 1. The company also has investments in operations in Guatemala, Panama, South Korea, the U.S. and Vietnam that are accounted for under the equity method of accounting and, accordingly, those results are not included in segment sales or earnings. Summary of Business by Segment ` Three Months Ended March 31, ($ in millions) 2017 2016 Net sales Beverage packaging, North and Central America $ 949 $ 734 Beverage packaging, South America 371 126 Beverage packaging, Europe 508 356 Food and aerosol packaging 272 284 Aerospace 236 180 Reportable segment sales 2,336 1,680 Other 137 76 Net sales $ 2,473 $ 1,756 Comparable operating earnings Beverage packaging, North and Central America $ 123 $ 93 Beverage packaging, South America 58 18 Beverage packaging, Europe 47 39 Food and aerosol packaging 21 20 Aerospace 21 18 Reportable segment comparable operating earnings 270 188 Reconciling items Other (a) (31) (31) Business consolidation and other activities (55) (267) Amortization of acquired Rexam intangibles (32) — Earnings (loss) before interest and taxes 152 (110) Interest expense (68) (38) Debt refinancing and other costs — (61) Total interest expense (68) (99) Earnings (loss) before taxes 84 (209) Tax (provision) benefit (22) 83 Equity in results of affiliates, net of tax 8 (1) Net earnings (loss) 70 (127) Less net earnings attributable to noncontrolling interests (2) — Net earnings (loss) attributable to Ball Corporation $ 68 $ (127) (a) Includes undistributed corporate expenses, net, of $45 million and $22 million for the first quarter of 2017 and 2016, respectively. The company does not disclose total assets by segment as it is not provided to the chief operating decision maker. |
Acquisitions and Dispositions
Acquisitions and Dispositions | 3 Months Ended |
Mar. 31, 2017 | |
Acquisitions and Dispositions | |
Acquisitions and Dispositions | 4. Acquisitions and Dispositions Rexam On June 30, 2016, Ball acquired 100 percent of the outstanding shares of Rexam PLC (Rexam), a U.K. based beverage container manufacturer, for the purchase price of £2.9 billion ($3.8 billion) in cash, and 32.25 million treasury shares of Ball Corporation common stock (valued at $71.39 per share for a total share consideration of $2.3 billion). Additionally, the company recorded $24 million of consideration for stock-based compensation. The common shares were valued using the price on the date of acquisition and were presented as a reduction of treasury stock. The cash portion of the acquisition price was paid in July 2016 using proceeds from restricted cash held in escrow and borrowings under the $1.4 billion and €1.1 billion Term A loan facilities obtained in March 2016. The consummation of the acquisition was subject to, among other things, approval from Ball’s shareholders, approval from Rexam’s shareholders, certain regulatory approvals and satisfaction of other customary closing conditions. In order to satisfy certain regulatory requirements, the company was required to sell the Divestment Business. In order to satisfy certain regulatory requirements, the company was required to sell a portion of Ball’s existing beverage packaging business and select beverage can assets of the Divestment Business. The sale of the Divestment Business to Ardagh Group S.A. (Ardagh), was completed concurrently on June 30, 2016, for $3.42 billion, subject to customary closing adjustments and certain transaction service arrangements between Ball and Ardagh during a transition period. The sale agreement with Ardagh in respect of the Divestment Business contains customary representations, warranties, covenants and provisions allocating liabilities, as well as indemnification obligations to and from Ardagh, pursuant to which claims may be made when applicable. A pretax gain of $330 million was recorded in connection with the sale within business consolidation and other activities and is subject to finalization of working capital and other items. As a condition of the sale of the Divestment Business to Ardagh, the company has guaranteed a minimum volume of sales for the Divestment Business in 2017, whereby the company would be required to pay Ardagh up to $75 million based upon any shortfall of 2017 sales relative to an agreed-upon minimum threshold. Additionally, the company entered into a supply agreement with Ardagh to manufacture and sell can ends to the Divestment Business in Brazil in exchange for proceeds of $103 million. In the sale of the Divestment Business to Ardagh on June 30, 2016, the company provided indemnifications for the uncertain tax positions of the Divestment Business sold to Ardagh. These indemnifications were accounted for as guarantees and the company initially recognized a liability equal to the fair value of the indemnities. There are no limitations on the maximum potential future payments the company could be obligated to make and, based on the nature of the indemnified items, the company is unable to reasonably estimate its potential exposure under these items. During the three months ended March 31, 2017, the company recorded an additional $27 million in business consolidation and other costs for an increase in the estimated amount of the claims covered by the indemnification as a result of a tax audit in Germany and settlement discussions entered into with the German tax authorities in April. The estimated value of the claims under this indemnity is $50 million at March 31, 2017, and has been recorded within other current liabilities. The portion of the Divestment Business composed of Ball's legacy beverage packaging businesses had earnings before taxes as shown below. These earnings before taxes may not be indicative of the earnings before taxes that would be generated by these components of the Divestment Business in future periods. Additionally, due to complexities associated with how Ball's legacy beverage packaging businesses included in the Divestment Business were integrated into Ball Corporation in historical periods, these earnings before taxes may not be indicative of the earnings before taxes of these components of the Divestment Business were they to be operated as a standalone business or businesses: Three Months Ended March 31, ($ in millions) 2016 Earnings before taxes $ 37 Earnings before taxes attributable to Ball Corporation $ 37 The Rexam portion of the Divestment Business is not included in the table above as the financial information is not included in Ball’s historical results. A total of 54 manufacturing facilities were acquired from Rexam, including 17 in North America, 20 in Europe, 12 in South America and five in the AMEA region. A total of 22 manufacturing facilities were sold as part of the Divestment Business, including 12 Ball facilities and 10 Rexam facilities. Of these 22 facilities, eight are located in North America, 12 are located in Europe and two are located in Brazil. The company has a total of 75 beverage manufacturing facilities and joint ventures after the completion of the acquisition and the sale of the Divestment Business. This acquisition aligns with Ball’s Drive for 10 vision, including the company’s longstanding capital allocation strategy and EVA philosophy. The combination creates the world’s largest supplier of beverage containers allowing the company to better serve its customers with its enhanced geographic footprint and innovative product offerings. In particular, Ball expects the acquisition to deliver long-term shareholder value through optimizing global sourcing, reducing general and administrative expenses, sharing best practices to improve production efficiencies and leveraging its footprint to lower freight, logistics and warehousing costs. In addition, further value can be created through balance sheet improvements with a focus on working capital and inventory management and sustainability priorities as a result of the larger plant network. The acquisition has been accounted for as a business combination and its results of operations have been included in the company’s consolidated statements of earnings and cash flows from the date of acquisition. In total, pretax charges of $216 million have been incurred for transaction costs associated with the acquisition, which, in accordance with current accounting guidance, were expensed as incurred. The transaction costs are included in the business consolidation and other activities line of the consolidated statement of earnings. In connection with the acquisition, Ball assumed Rexam debt of approximately $2.8 billion of which approximately $2.7 billion was extinguished during July and August 2016. The proceeds from the sale of the Divestment Business were partially used to extinguish the assumed Rexam debt. The valuation by management of certain assets and liabilities is still in process and, therefore, these fair values are preliminary in nature and are subject to adjustment as additional information is obtained about the facts and circumstances that existed as of the acquisition date. The final determination of the fair values will be completed within the measurement period of up to one year from the acquisition date as permitted under U.S. GAAP and any adjustments to provisional amounts that are identified during the measurement period will be recorded in the reporting period in which the adjustment is determined. The size and complexity of the acquisition of Rexam could necessitate the need to use the full one year measurement period to adequately analyze and assess a number of the factors used in establishing the asset and liability fair values as of the acquisition date including contractual and operational factors underlying the intangible assets. Any potential adjustments made could be material in relation to the preliminary values presented in the table below. The company adjusted the preliminary allocation of the purchase price for the Rexam acquisition during the three months ended March 31, 2017. These adjustments, none of which were material, have been reflected in the preliminary allocations of the purchase price. The impacts of all adjustments have been reflected in the unaudited condensed consolidated financial statements as of and for the quarter ended March 31, 2017. The primary areas of the purchase price allocation that are not yet finalized relate to fixed assets and operating leases, income and non-income taxes, the valuation of intangible assets acquired and residual goodwill. The preliminary amounts assigned to intangible assets by type for the Rexam acquisition were based on the company’s valuation model and historical experiences with entities with similar business characteristics. The preliminary amounts are summarized in the table below: June 30, ($ in millions) 2016 Cash $ 450 Receivables, net 775 Inventories, net 792 Other current assets 164 Assets held for sale (sold to Ardagh on June 30, 2016) 913 Total current assets 3,094 Property, plant and equipment 2,296 Goodwill 3,799 Intangible assets 1,888 Restricted cash 174 Other assets 439 Total assets acquired 11,690 Short-term debt and current portion of long-term debt 2,792 Accounts payable 870 Accrued employee costs 135 Liabilities held for sale (sold to Ardagh on June 30, 2016) 7 Other current liabilities 377 Total current liabilities 4,181 Long-term debt 28 Employee benefit obligations 508 Deferred taxes and other liabilities 723 Total liabilities assumed 5,440 Net assets acquired 6,250 Noncontrolling interests (90) Aggregate value of consideration paid $ 6,160 The following table details the identifiable intangible assets acquired, their preliminary fair values and estimated useful lives: ($ in millions) Fair Value Weighted- Customer relationships $ 1,840 15 Trademarks 40 5 Technology 8 9 $ 1,888 Because the acquisition of Rexam was a stock purchase, neither the goodwill nor the intangible assets acquired are deductible under local country corporate tax laws but will generally be deductible in computing earnings and profits for U.S. tax purposes. The following unaudited pro forma consolidated results of operations (pro forma information) have been prepared as if the acquisition of Rexam and the sale of the Divestment Business had occurred as of January 1, 2015. The pro forma information combines the historical results of Ball and Rexam. The pro forma results are not necessarily indicative of the actual results that would have occurred had the acquisition been in effect for the periods presented, nor are they necessarily indicative of the results that may be obtained in the future. Three Months Ended March 31, ($ in millions, except per share amounts) 2016 Net sales (1) $ 2,418 Net earnings attributable to Ball Corporation (2) 22 Basic earnings per share 0.13 Diluted earnings per share 0.12 (1) Net sales were adjusted to include net sales of Rexam. The company also excluded the net sales attributable to the Divestment Business. (2) Pro forma adjustments to net earnings attributable to Ball Corporation were adjusted as follows: · Excludes acquisition-related transaction costs and debt refinancing costs incurred in the three months ended March 31, 2016. · Includes interest expense associated with the new debt utilized to finance the acquisition. · Includes depreciation and amortization expense based on the increased fair value of property, plant and equipment and amortizable intangible assets acquired. · Excludes net earnings attributable to the Divestment Business for the three months ended March 31, 2016. All of these pro forma adjustments were adjusted for the applicable income tax impacts. Ball has applied enacted statutory tax rates in the U.K. for the period. Ball has used a tax rate of 20.0 percent to calculate the financing and acquisition adjustments for the three months ended March 31, 2016. However, the tax impact on acquisition-related transaction costs already incurred were recorded at a U.S. statutory rate of approximately 37 percent as these transaction costs were incurred in the U.S. These rates may not be reflective of Ball’s effective tax rate for future periods after consummation of the acquisition and sale of the Divestment Business. Currency Exchange Rate and Interest Rate Risks The company entered into collar and option contracts to partially mitigate its currency exchange rate risk associated with the British pound denominated cash portion of the purchase price from February 19, 2015, through the closing date of the Rexam acquisition. The company entered into interest rate swaps to hedge against rising U.S. and European interest rates to minimize its interest rate exposure associated with anticipated debt issuances in connection with the acquisition of Rexam. These contracts were not designated as hedges for accounting purposes, and therefore, changes in the fair value of these contracts were recorded in the consolidated statements of earnings in business consolidation and other activities, as well as in debt refinancing and other costs, a component of total interest expense. Food and Aerosol Paint and General Line Plant In March 2017, the company sold its paint and general line can manufacturing facility in Hubbard, Ohio, for approximately $32 million in cash and recorded a $15 million gain on the sale. Wavefront Technologies (Wavefront) In January 2016, the company acquired Wavefront located in Annapolis Junction, Maryland, for total cash consideration of $36 million, net of cash acquired. Wavefront provides systems and network engineering, software development software and analytical services for cyber and mission-focused programs to the U.S. government and commercial industry. The financial results of Wavefront have been included in our aerospace segment from the date of acquisition. The acquisition is not material to the company. Food and Aerosol Specialty Tin Business In October 2016, the company sold its specialty tin manufacturing facility in Baltimore, Maryland, for approximately $24 million in cash and recorded a $9 million gain on the sale. |
Business Consolidation and Othe
Business Consolidation and Other Activities | 3 Months Ended |
Mar. 31, 2017 | |
Business Consolidation and Other Activities | |
Business Consolidation and Other Activities | 5. Business Consolidation and Other Activities The following is a summary of business consolidation and other activity (charges)/income included in the unaudited condensed consolidated statements of earnings: Three Months Ended March 31, ($ in millions) 2017 2016 Beverage packaging, North and Central America $ (4) $ (3) Beverage packaging, South America 3 — Beverage packaging, Europe (3) (4) Food and aerosol packaging 10 (14) Other (61) (246) $ (55) $ (267) 2017 Beverage Packaging, North and Central America During the three months ended March 31, 2017, the company recorded charges of $3 million for employee severance and accelerated depreciation related to the closure of our Reidsville, North Carolina, plant. Other charges in the three months ended March 31, 2017, included $1 million of individually insignificant activities. Beverage Packaging, South America Income in the three months ended March 31, 2017, included $3 million of individually insignificant activities. Beverage Packaging, Europe During the three months ended March 31, 2017, the company recorded charges of $2 million for professional services and other costs associated with the acquisition of Rexam. Other charges in the three months ended March 31, 2017, included $1 million of individually insignificant activities. Food and Aerosol Packaging During the three months ended March 31, 2017, the company recorded charges of $3 million for facility shutdown costs and accelerated depreciation for the closure of our Weirton, West Virginia, plant which ceased production during the first quarter of 2017. During the first quarter of 2017, the company sold its food and aerosol packaging paint and general line can plant in Hubbard, Ohio, and recorded a gain on sale of $15 million. Other charges in the three months ended March 31, 2017, included $2 million of individually insignificant activities. Other During the three months ended March 31, 2017, the company recorded the following amounts: · Expense of $27 million for indemnifications of uncertain tax positions associated with the sale of the Divestment Business. · A $14 million reduction in the gain recognized in connection with the sale of the Ball portion of the Divestment Business. · Expense of $9 million for long term incentive and other compensation arrangements associated with the Rexam acquisition. · Expense of $5 million for professional services and other costs associated with the acquisition of Rexam. · Expense of $6 million for individually insignificant activities. 2016 Beverage Packaging, North and Central America Charges in the three months ended March 31, 2016, included $3 million of individually insignificant activities Beverage Packaging, Europe During the three months ended March 31, 2016, the company recorded charges of $4 million for professional services and other costs associated with the acquisition of Rexam. Food and Aerosol Packaging During the three months ended March 31, 2016, the company recorded charges of $9 million for employee severance and benefits, facility shutdown costs, and asset impairment and disposal costs for the closure of our Weirton, West Virginia, plant. Other charges in the three months ended March 31, 2016, included $5 million of individually insignificant activities. Other During the three months ended March 31, 2016, the company recorded the following charges: · Expense of $24 million for professional services and other costs associated with the acquisition of Rexam. · Losses of $88 million associated with the collar, swap, and option contracts entered into to reduce its exposure to currency exchange rate changes in connection with the British pound denominated cash portion of the purchase price for the acquisition of Rexam. · Foreign currency losses of $96 million from the revaluation of foreign currency denominated restricted cash and intercompany loans related to the cash component of the Rexam acquisition purchase price, the sale of the Divestment Business and the revaluation of the euro-denominated debt issuance obtained in December 2015. · An unrealized loss of $36 million on the fair value of cross-currency swaps entered into in connection with the December 2015 issuance of the $1 billion senior notes due 2020. · Expense of $2 million for individually insignificant activities. |
Receivables
Receivables | 3 Months Ended |
Mar. 31, 2017 | |
Receivables | |
Receivables | 6. Receivables March 31, December 31, ($ in millions) 2017 2016 Trade accounts receivable $ 1,365 $ 1,169 Less allowance for doubtful accounts (11) (11) Net trade accounts receivable 1,354 1,158 Other receivables 341 333 $ 1,695 $ 1,491 The company has entered into several regional committed and uncommitted accounts receivable factoring programs with various financial institutions for certain receivables of the company. The programs are accounted for as true sales of the receivables, without recourse to Ball, and had combined limits of approximately $865 million at March 31, 2017. A total of $542 million and $596 million were sold under these programs as of March 31, 2017, and December 31, 2016, respectively. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2017 | |
Inventories | |
Inventories | 7. Inventories March 31, December 31, ($ in millions) 2017 2016 Raw materials and supplies $ 653 $ 607 Work-in-process and finished goods 930 839 Less inventory reserves (29) (33) $ 1,554 $ 1,413 |
Property, Plant and Equipment
Property, Plant and Equipment | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment | |
Property, Plant and Equipment | 8. Property, Plant and Equipment March 31, December 31, ($ in millions) 2017 2016 Land $ 101 $ 105 Buildings 1,313 1,301 Machinery and equipment 4,872 4,723 Construction-in-progress 454 503 6,740 6,632 Accumulated depreciation (2,337) (2,245) $ 4,403 $ 4,387 Property, plant and equipment are stated at historical or acquired cost. Depreciation expense amounted to $107 million and $65 million for the three months ended March 31, 2017 and 2016, respectively. |
Goodwill
Goodwill | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets | |
Goodwill | 9. Goodwill ($ in millions) Beverage Beverage Beverage Food Aerospace Other Total Balance at December 31, 2016 $ 1,614 $ 970 $ 1,632 $ 599 $ 40 $ 240 $ 5,095 Opening balance sheet adjustments 18 4 — — — — 22 Business dispositions — — — (9) — — (9) Effects of currency exchange rates — — 40 2 — 2 44 Balance at March 31, 2017 $ 1,632 $ 974 $ 1,672 $ 592 $ 40 $ 242 $ 5,152 The company’s annual goodwill impairment test completed in the fourth quarter of 2016 indicated the fair value of the beverage packaging, Asia (Beverage Asia), reporting unit exceeded its carrying amount by approximately 23 percent. The current supply of metal beverage packaging exceeds demand in China, resulting in pricing pressure and negative impacts on the profitability of our Beverage Asia reporting unit. If it becomes an expectation that this oversupply situation will continue for an extended period of time, the company may be required to record a noncash impairment charge for some or all of the goodwill associated with the Beverage Asia reporting unit, the total balance of which was $78 million at March 31, 2017. |
Intangible Assets ,net
Intangible Assets ,net | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets | |
Intangible Assets, net | 10. Intangible Assets, net March 31, December 31, ($ in millions) 2017 2016 Acquired Rexam intangibles (net of accumulated amortization of $96 million at March 31, 2017, and $62 million at December 31, 2016) $ 1,752 $ 1,766 Capitalized software (net of accumulated amortization of $92 million at March 31, 2017, and $87 million at December 31, 2016) 77 79 Other intangibles (net of accumulated amortization of $149 million at March 31, 2017, and $143 million at December 31, 2016) 88 89 $ 1,917 $ 1,934 Total amortization expense of intangible assets amounted to $41 million and $10 million for the three months ended March 31, 2017 and 2016, respectively, |
Other Assets
Other Assets | 3 Months Ended |
Mar. 31, 2017 | |
Other Assets.. | |
Other Assets. | 11. Other Assets March 31, December 31, ($ in millions) 2017 2016 Long-term deferred tax assets $ 575 $ 443 Long-term pension asset 154 147 Investments in affiliates 213 204 Company and trust-owned life insurance 156 146 Other 167 164 $ 1,265 $ 1,104 |
Debt and Interest Costs
Debt and Interest Costs | 3 Months Ended |
Mar. 31, 2017 | |
Debt and Interest Costs | |
Debt and Interest Costs | 12. Debt and Interest Costs Long-term debt consisted of the following: March 31, December 31, ($ in millions) 2017 2016 Senior Notes 5.25% due July 2025 $ 1,000 $ 1,000 4.375% due December 2020 1,000 1,000 4.00% due November 2023 1,000 1,000 4.375%, euro denominated, due December 2023 746 736 5.00% due March 2022 750 750 3.50%, euro denominated, due December 2020 426 421 Senior Credit Facilities, due March 2021 (at variable rates) Term A loan, due June 2021 1,365 1,383 Term A loan, euro denominated, due June 2021 967 954 Multi-currency USD revolver, due March 2021 345 190 Other (including debt issuance costs) (44) (45) 7,555 7,389 Less: Current portion of long-term debt (79) (79) $ 7,476 $ 7,310 Following is a summary of debt refinancing and other costs included in the unaudited condensed consolidated statements of earnings: Three Months Ended March 31, ($ in millions) 2017 2016 Debt Refinancing and Other Costs: Interest expense on 3.5% and 4.375% senior notes $ — $ (25) Economic hedge - interest rate risk — (16) Refinance of bridge and revolving credit facilities — (13) Amortization of unsecured, committed bridge facility financing fees — (7) $ — $ (61) The senior credit facilities include long-term, multi-currency committed revolving credit facilities that provide the company with up to the U.S. dollar equivalent of $1.5 billion. At March 31, 2017, taking into account outstanding letters of credit, approximately $1.1 billion was available under these long-term, revolving credit facilities. In addition to these facilities, the company had approximately $902 million of short-term uncommitted credit facilities available at March 31, 2017, of which $418 million was outstanding and due on demand. At December 31, 2016, the company had $143 million outstanding under short-term uncommitted credit facilities. The fair value of long-term debt was estimated to be $7.8 billion at March 31, 2017, which approximated the carrying value of $7.5 billion. The fair value was estimated to be $7.7 billion at December 31, 2016, which approximated the carrying value of $7.4 billion. The fair value reflects the market rates at each period end for debt with credit ratings similar to the company’s ratings and is classified as Level 2 within the fair value hierarchy. Rates currently available to the company for loans with similar terms and maturities are used to estimate the fair value of long-term debt based on discounted cash flows. Ball provides letters of credit in the ordinary course of business to secure liabilities recorded in connection with certain self-insurance arrangements. Letters of credit outstanding were $32 million at both March 31, 2017 and December 31, 2016, respectively. The company’s senior notes and senior credit facilities are guaranteed on a full, unconditional and joint and several basis by certain of the company’s material subsidiaries. Each of the guarantor subsidiaries is 100 percent owned by Ball Corporation. These guarantees are required in support of these notes and credit facilities, are co-terminous with the terms of the respective note indentures and would require performance upon certain events of default referred to in the respective guarantees. Note 19 includes further details about the company’s debt guarantees and Note 20 contains further details, as well as required condensed consolidating financial information for the company, segregating the guarantor subsidiaries and non-guarantor subsidiaries as defined in the debt agreements. The U.S. note agreements and bank credit agreement contain certain restrictions relating to dividend payments, share repurchases, investments, financial ratios, guarantees and the incurrence of additional indebtedness. The most restrictive of the company’s debt covenants require the company to maintain a leverage ratio (as defined) of no greater than 5 times at March 31, 2017, which changes to 4 times at December 31, 2017. The company was in compliance with all loan agreements and debt covenants at March 31, 2017 and December 31, 2016, and has met all debt payment obligations. |
Employee Benefit Obligations
Employee Benefit Obligations | 3 Months Ended |
Mar. 31, 2017 | |
Employee Benefit Obligations | |
Employee Benefit Obligations | 13. Employee Benefit Obligations March 31, December 31, ($ in millions) 2017 2016 Underfunded defined benefit pension liabilities $ 969 $ 963 Less current portion (21) (25) Long-term defined benefit pension liabilities 948 938 Retiree medical and other postemployment benefits 219 226 Deferred compensation plans 261 272 Other 59 61 $ 1,487 $ 1,497 Components of net periodic benefit cost associated with the company’s defined benefit pension plans were: Three Months Ended March 31, 2017 2016 ($ in millions) U.S. Foreign Total U.S. Foreign Total Ball-sponsored plans: Service cost $ 12 $ 4 $ 16 $ 12 $ 3 $ 15 Interest cost 33 22 55 15 5 20 Expected return on plan assets (33) (26) (59) (18) (5) (23) Recognized net actuarial loss 9 1 10 8 1 9 Net periodic benefit cost for Ball sponsored plans 21 1 22 17 4 21 Net periodic benefit cost for multi-employer plans 1 — 1 — — — Total net periodic benefit cost $ 22 $ 1 $ 23 $ 17 $ 4 $ 21 Contributions to the company’s defined benefit pension plans, not including unfunded German, Swedish and certain U.S. plans, were $8 million in the first three months of 2017 compared to $20 million in the first three months of 2016, and are expected to be in the range of $190 million for the full year of 2017. This estimate may change based on any changes to the U.S. Pension Protection Act and actual plan asset performance, among other factors. Included in the contributions during the first three months of 2017 were contributions to acquired Rexam defined benefit pension plans. Payments to participants in the unfunded German, Swedish and certain U.S. plans were $6 million in the first three months of 2017 and are expected to be approximately $20 million for the full year of 2017. |
Shareholders_ Equity and Compre
Shareholders’ Equity and Comprehensive Earnings | 3 Months Ended |
Mar. 31, 2017 | |
Shareholders’ Equity | |
Comprehensive Income (Loss) Note [Text Block] | 14. Shareholders’ Equity and Comprehensive Earnings Accumulated Other Comprehensive Earnings (Loss) The activity related to accumulated other comprehensive earnings (loss) was as follows: ($ in millions) Foreign Currency Translation (Net of Tax) Pension and Other Postretirement Benefits (Net of Tax) Effective Derivatives (Net of Tax) Accumulated Other Comprehensive Earnings (Loss) Balance at December 31, 2016 $ (329) $ (590) $ (22) $ (941) Other comprehensive earnings (loss) before reclassifications 69 (4) 33 98 Amounts reclassified from accumulated other comprehensive earnings (loss) — 6 24 30 Balance at March 31, 2017 $ (260) $ (588) $ 35 $ (813) The following table provides additional details of the amounts recognized into net earnings from accumulated other comprehensive earnings (loss): Three Months Ended March 31, ($ in millions) 2017 2016 Gains (losses) on cash flow hedges: Commodity contracts recorded in net sales $ (3) $ 3 Commodity contracts recorded in cost of sales 8 (7) Currency exchange contracts recorded in business consolidation and other activities 3 (1) Cross currency swaps recorded in selling, general and administrative (17) — Total before tax effect (9) (5) Tax benefit (expense) on amounts reclassified into earnings (15) 1 Recognized gain (loss) $ (24) $ (4) Amortization of pension and other postretirement benefits (a) : Prior service income (expense) $ — $ 1 Actuarial gains (losses) (9) (9) Total before tax effect (9) (8) Tax benefit (expense) on amounts reclassified into earnings 3 3 Recognized gain (loss) $ (6) $ (5) (a) The pension components are included in the computation of net periodic benefit cost included in Note 13. |
Stock-Based Compensation Progra
Stock-Based Compensation Programs | 3 Months Ended |
Mar. 31, 2017 | |
Stock-Based Compensation Programs | |
Stock-Based Compensation Programs | 15. Stock-Based Compensation Programs The company has shareholder-approved stock plans under which options and stock-settled appreciation rights (SSARs) have been granted to employees at the market value of the company’s stock at the date of grant. In general, options and SSARs are exercisable in four equal installments commencing one year from the date of grant and terminating 10 years from the date of grant. There were 544,724 stock options and SSARs granted in January 2017. These options and SSARs cannot be traded in any equity market. However, based on the Black-Scholes option pricing model, options and SSARs granted in January 2017, July 2016 and January 2016 have estimated weighted average fair values at the date of grant of $17.08 per share, $16.71 per share and $18.58 per share, respectively. The actual value an employee may realize will depend on the excess of the stock price over the exercise price on the date the option or SSAR is exercised. Consequently, there is no assurance the value realized by an employee will approximate the value estimated. The fair values were estimated using the following weighted average assumptions: January 2017 July 2016 January 2016 Expected dividend yield 0.68 % 0.73 % 0.79 % Expected stock price volatility 20.49 % 24.14 % 29.25 % Risk-free interest rate 2.07 % 1.22 % 1.57 % Expected life of options (in years) 5.94 years 6.10 years 5.94 years In the first quarters of 2017 and 2016, the company’s board of directors granted 118,726 and 118,755 performance-contingent restricted stock units (PCEQs), respectively, to key employees. These PCEQs vest three years from the date of grant, and the number of shares available at the vesting date is based on the company’s growth in economic value added (EVA®) dollars in excess of the EVA® dollars generated in the calendar year prior to the grant as the minimum threshold, and can range from zero to 200 percent of each participant’s assigned PCEQ award. If the minimum performance goals are not met, the PCEQ will be forfeited. Grants under the plan are being accounted for as equity awards and compensation expense is recorded based upon the most probable outcome using the closing market price of the shares at the grant date. On a quarterly and annual basis, the company reassesses the probability of the goals being met and adjusts compensation expense as appropriate. Also in the first quarter of 2017 the company’s board of directors granted 558,986 performance-contingent restricted stock units to employees related to the Special Acquisition-Related Incentive Plan. The number of shares issued at the vesting date in January 2020 will be based on the company’s achievement of cumulative Economic Value Added (EVA®) and Cash Flow performance goals through the vesting date and can range from zero to 200 percent of each participant’s assigned award. If the minimum performance goals are not met, the awards will be forfeited. Grants under the plan are being accounted for as equity awards and compensation expense is recorded based upon the most probable outcome using the closing market price of the shares at the grant date. On a quarterly basis, the company will reassess the probability of the goals being met and adjust compensation expense as appropriate. |
Earnings and Dividends Per Shar
Earnings and Dividends Per Share | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share | |
Earnings Per Share | 16. Earnings and Dividends Per Share Three Months Ended March 31, ($ in millions, except per share amounts; shares in thousands) 2017 2016 Net earnings attributable to Ball Corporation $ 68 $ (127) Basic weighted average common shares 175,024 141,793 Effect of dilutive securities 3,943 — Weighted average shares applicable to diluted earnings per share 178,967 141,793 Per basic share $ 0.39 $ (0.90) Per diluted share $ 0.38 $ (0.90) The company reported a net loss in the first three months of 2016 and, as a result, all potentially issuable securities were excluded in the diluted earnings per share calculation as their effect would have been anti-dilutive. Had these securities been included, weighted average shares applicable to diluted earnings per share would have been 145,100. In the first three months of 2017, approximately 2 million outstanding options were excluded from the diluted earnings per share calculation because they were anti-dilutive (i.e., the sum of the assumed exercise proceeds and the unrecognized compensation exceeded the average closing stock price for the period). The company declared and paid dividends of $0.13 per share in the first quarter of both 2017 and 2016. Subsequent Event On April 26, 2017, the company’s board of directors declared a two-for-one split of Ball Corporation’s common stock and increased the quarterly cash dividend by 54 percent to 10 cents on a post-split basis. The stock split will be effective May 16, 2017, for shareholders of record on May 8, 2017. Below are pro forma weighted average shares and earnings per share as if the effective date had been January 1, 2016. Three Months Ended March 31, ($ in millions, except per share amounts; shares in thousands) 2017 2016 Net earnings attributable to Ball Corporation $ 68 $ (127) Basic weighted average common shares 350,048 283,586 Effect of dilutive securities 7,886 — Weighted average shares applicable to diluted earnings per share 357,934 283,586 Per basic share $ 0.19 $ (0.45) Per diluted share $ 0.19 $ (0.45) |
Financial Instruments and Risk
Financial Instruments and Risk Management | 3 Months Ended |
Mar. 31, 2017 | |
Financial Instruments and Risk Management | |
Financial Instruments and Risk Management | 17. Financial Instruments and Risk Management The company employs established risk management policies and procedures, which seek to reduce the company’s commercial risk exposure to fluctuations in commodity prices, interest rates, currency exchange rates and prices of the company’s common stock with regard to common share repurchases and the company’s deferred compensation stock plan. However, there can be no assurance these policies and procedures will be successful. Although the instruments utilized involve varying degrees of credit, market and interest risk, the counterparties to the agreements are expected to perform fully under the terms of the agreements. The company monitors counterparty credit risk, including lenders, on a regular basis, but Ball cannot be certain that all risks will be discerned or that its risk management policies and procedures will always be effective. Additionally, in the event of default under the company’s master derivative agreements, the non-defaulting party has the option to offset any amounts owed with regard to open derivative positions. Commodity Price Risk Aluminum The company manages commodity price risk in connection with market price fluctuations of aluminum ingot through two different methods. First, the company enters into container sales contracts that include aluminum ingot-based pricing terms that generally reflect the same price fluctuations under commercial purchase contracts for aluminum sheet. The terms include fixed, floating or pass-through aluminum ingot component pricing. Second, the company uses certain derivative instruments such as option and forward contracts as economic and cash flow hedges of commodity price risk where there are material differences between sales and purchase contracted pricing and volume. At March 31, 2017, the company had aluminum contracts limiting its aluminum exposure with notional amounts of approximately $748 million, of which approximately $680 million received hedge accounting treatment. The aluminum contracts, which are recorded at fair value, include economic derivative instruments that are undesignated, as well as cash flow hedges that offset sales and purchase contracts of various terms and lengths. Cash flow hedges relate to forecasted transactions that will occur within the next three years. Included in shareholders’ equity at March 31, 2017, within accumulated other comprehensive earnings (loss), is a net after-tax gain of $51 million associated with these contracts. A net after-tax gain of $36 million is expected to be recognized in the consolidated statement of earnings during the next 12 months, the majority of which will be offset by pricing changes in sales and purchase contracts, thus resulting in little or no earnings impact to Ball. Steel Most sales contracts involving our steel products either include provisions permitting the company to pass through some or all steel cost changes incurred, or they incorporate annually negotiated steel prices. Interest Rate Risk The company’s objective in managing exposure to interest rate changes is to minimize the impact of interest rate changes on earnings and cash flows and to lower our overall borrowing costs. To achieve these objectives, the company may use a variety of interest rate swaps, collars and options to manage our mix of floating and fixed-rate debt. Interest rate instruments held by the company at March 31, 2017, included pay-fixed interest rate swaps with notional amounts of approximately $500 million, which effectively convert variable rate obligations to fixed-rate instruments. There was no after-tax gain included in shareholders’ equity at March 31, 2017, within accumulated other comprehensive earnings (loss). The contracts outstanding at March 31, 2017, expire within the next twelve months. Currency Exchange Rate Risk The company’s objective in managing exposure to currency fluctuations is to limit the exposure of cash flows and earnings from changes associated with currency exchange rate changes through the use of various derivative contracts. In addition, at times the company manages earnings translation volatility through the use of currency option strategies, and the change in the fair value of those options is recorded in the company’s net earnings. The company’s currency translation risk results from the currencies in which we transact business. The company faces currency exposures in our global operations as a result of various factors including intercompany currency denominated loans, selling our products in various currencies, purchasing raw materials and equipment in various currencies and tax exposures not denominated in the functional currency. Sales contracts are negotiated with customers to reflect cost changes and, where there is not an exchange pass-through arrangement, the company uses forward and option contracts to manage currency exposures. At March 31, 2017, the company had outstanding exchange rate forward contracts and option contracts with notional amounts totaling approximately $1.4 billion. Approximately $2 million of net after-tax loss related to these contracts is included in accumulated other comprehensive earnings at March 31, 2017, of which a net gain of less than $1 million is expected to be recognized in the unaudited condensed consolidated statement of earnings during the next 12 months. The contracts outstanding at March 31, 2017, expire within the next two years. Additionally, the company entered into a $1 billion cross-currency swap contract to partially mitigate the risk associated with foreign currency denominated intercompany debt incurred in the second quarter of 2016. Approximately, $13 million of net after-tax loss related to this contract is included in accumulated other comprehensive earnings at March 31, 2017, none of which is expected to be recognized in the unaudited condensed consolidated statement of earnings during the next 12 months. As of March 31, 2017, the fair value of the cross-currency swap was a $27 million gain. The contract expires in December 2020. Common Stock Price Risk The company’s deferred compensation stock program is subject to variable plan accounting and, accordingly, is marked to fair value using the company’s closing stock price at the end of the related reporting period. The company entered into total return swaps to reduce the company’s earnings exposure to these fair value fluctuations that will be outstanding until March 2018 and August 2017 and that have a combined notional value of 1.3 million shares. Based on the current number of shares in the program, each $1 change in the company’s stock price has an insignificant impact on pretax earnings, net of the impact of related derivatives. As of March 31, 2017, the fair value of the swap was a $1 million loss. Collateral Calls The company’s agreements with its financial counterparties require the company to post collateral in certain circumstances when the negative mark to fair value of the derivative contracts exceeds specified levels. Additionally, the company has collateral posting arrangements with certain customers on these derivative contracts. The cash flows of the margin calls are shown within the investing section of the company’s consolidated statements of cash flows. As of March 31, 2017, and December 31, 2016, the aggregate fair value of all derivative instruments with credit-risk-related contingent features that were in a net liability position were $27 million and $44 million, respectively, and no collateral was required to be posted. Fair Value Measurements The company has classified all applicable financial derivative assets and liabilities as Level 2 within the fair value hierarchy as of March 31, 2017, and December 31, 2016, and presented those values in the tables below. The company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. March 31, 2017 December 31, 2016 ($ in millions) Derivatives Derivatives not Total Derivatives Derivatives not Total Assets: Commodity contracts $ 63 $ 3 $ 66 $ 17 $ 1 $ 18 Foreign currency contracts — 21 21 1 — 1 Interest rate and other contracts — — — — 21 21 Total current derivative contracts $ 63 $ 24 $ 87 $ 18 $ 22 $ 40 Commodity contracts $ 15 $ — $ 15 $ 7 $ — $ 7 Foreign currency contracts 1 — 1 — — — Interest rate and other contracts 27 — 27 39 — 39 Total noncurrent derivative contracts $ 43 $ — $ 43 $ 46 $ — $ 46 Liabilities: Commodity contracts $ 14 $ 1 $ 15 $ 3 $ — $ 3 Foreign currency contracts — 5 5 — 22 22 Interest rate and other contracts — 1 1 — — — Total current derivative contracts $ 14 $ 7 $ 21 $ 3 $ 22 $ 25 The company uses closing spot and forward market prices as published by the London Metal Exchange, the Chicago Mercantile Exchange, Reuters and Bloomberg to determine the fair value of any outstanding aluminum, currency, energy, inflation and interest rate spot and forward contracts. Option contracts are valued using a Black-Scholes model with observable market inputs for aluminum, currency and interest rates. We value each of our financial instruments either internally using a single valuation technique or from a reliable observable market source. The company does not adjust the value of its financial instruments except in determining the fair value of a trade that settles in the future by discounting the value to its present value using 12-month LIBOR as the discount factor. Ball performs validations of our internally derived fair values reported for our financial instruments on a quarterly basis utilizing counterparty valuation statements. Additionally, the company evaluates counterparty creditworthiness and, as of March 31, 2017, has not identified any circumstances requiring the reported values of our financial instruments be adjusted. The following table provides the effects of derivative instruments in the consolidated statement of earnings and on accumulated other comprehensive earnings (loss): Three Months Ended March 31, 2017 2016 ($ in millions) Location of Gain (Loss) Cash Flow Gain (Loss) on Cash Flow Gain (Loss) on Commodity contracts - manage exposure to customer pricing Net sales $ (3) $ — $ 3 $ — Commodity contracts - manage exposure to supplier pricing Cost of sales 8 — (7) — Interest rate contracts - manage exposure for forecasted Rexam financing Debt refinancing and other costs — — — (16) Foreign currency contracts - manage general exposure with the business Selling, general and administrative — (15) (1) — Foreign currency contracts - manage exposure for acquisition of Rexam Business consolidation and other activities 3 — — (88) Cross-currency swaps - manage exposure for acquisition of Rexam Business consolidation and other activities — — — (36) Cross-currency swaps - manage intercompany currency exposure within the business Selling, general and administrative (17) — — — Equity contracts Selling, general and administrative — (2) — (2) Total $ (9) $ (17) $ (5) $ (142) The changes in accumulated other comprehensive earnings (loss) for effective derivatives were as follows: Three Months Ended March 31, ($ in millions) 2017 2016 Amounts reclassified into earnings: Commodity contracts $ (5) $ 4 Cross currency swap contracts 17 — Currency exchange contracts (3) 1 Change in fair value of cash flow hedges: Commodity contracts 51 (6) Interest rate contracts — (2) Cross currency swap contracts (12) — Currency exchange contracts 3 3 Foreign currency and tax impacts 6 — $ 57 $ — |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Contingencies | |
Contingencies | 18. Contingencies Ball is subject to numerous lawsuits, claims or proceedings arising out of the ordinary course of business, including actions related to product liability; personal injury; the use and performance of company products; warranty matters; patent, trademark or other intellectual property infringement; contractual liability; the conduct of the company’s business; tax reporting in domestic and foreign jurisdictions; workplace safety; and environmental and other matters. The company has also been identified as a potentially responsible party (PRP) at several waste disposal sites under U.S. federal and related state environmental statutes and regulations and may have joint and several liability for any investigation and remediation costs incurred with respect to such sites. In addition, we have received claims alleging that employees in certain plants have suffered damages due to exposure to alleged workplace hazards. Some of these lawsuits, claims and proceedings involve substantial amounts, including as described below, and some of the environmental proceedings involve potential monetary costs or sanctions that may be material. Ball has denied liability with respect to many of these lawsuits, claims and proceedings and is vigorously defending such lawsuits, claims and proceedings. The company carries various forms of commercial, property and casualty, and other forms of insurance; however, such insurance may not be applicable or adequate to cover the costs associated with a judgment against Ball with respect to these lawsuits, claims and proceedings. The company estimates that potential liabilities for all currently known and estimable environmental matters are approximately $45 million in the aggregate and have been included in other current liabilities and other noncurrent liabilities at March 31, 2017. As previously reported, the U.S. Environmental Protection Agency (USEPA) considers the company a PRP with respect to the Lowry Landfill site located east of Denver, Colorado. In 1992, the company was served with a lawsuit filed by the City and County of Denver (Denver) and Waste Management of Colorado, Inc., seeking contributions from the company and approximately 38 other companies. The company filed its answer denying the allegations of the complaint. Subsequently in 1992, the company was served with a third-party complaint filed by S.W. Shattuck Chemical Company, Inc., seeking contribution from the company and other companies for the costs associated with cleaning up the Lowry Landfill. The company denied the allegations of the complaint. Also in 1992, Ball entered into a settlement and indemnification agreement with Chemical Waste Management, Inc., and Waste Management of Colorado, Inc. (collectively Waste Management) and Denver pursuant to which Waste Management and Denver dismissed their lawsuit against the company, and Waste Management agreed to defend, indemnify and hold harmless the company from claims and lawsuits brought by governmental agencies and other parties relating to actions seeking contributions or remedial costs from the company for the cleanup of the site. Waste Management, Inc., has agreed to guarantee the obligations of Waste Management. Waste Management and Denver may seek additional payments from the company if the response costs related to the site exceed $319 million. In 2003 Waste Management, Inc., indicated that the cost of the site might exceed $319 million in 2030, approximately three years before the projected completion of the project. In January 2015, Waste Management reported that total project costs to date were approximately $140 million. The company might also be responsible for payments (based on 1992 dollars) for any additional wastes that may have been disposed of by the company at the site but which are identified after the execution of the settlement agreement. While remediating the site, contaminants were encountered, which could add an additional cleanup cost of approximately $10 million. This additional cleanup cost could, in turn, add approximately $1 million to total site costs for the PRP group. At this time, there are no Lowry Landfill actions in which the company is actively involved. Based on the information available to the company at this time, we do not believe that this matter will have a material adverse effect upon the liquidity, results of operations or financial condition of the company. In November 2012, the USEPA wrote to the company asserting that it is one of at least 50 PRPs with respect to the Lower Duwamish site located in Seattle, Washington, based on the company’s ownership of a glass container plant prior to 1995, and notifying the company of a proposed remediation action plan. An allocator has been selected to begin data review on over 30 industrial companies and government entities and at least two PRP groups have begun to discuss various allocation proposals, and this process may last approximately one more year. During the third quarter of 2014, the PRP groups voted to include 20 new members. The USEPA issued the site Record of Decision (ROD) on December 2, 2014. Ball submitted its initial responses to the allocator’s questionnaire in March 2015, and after reviewing submissions from the PRPs alleging deficiencies in certain of Ball’s responses, the allocator denied certain of the allegations and directed the company to answer others, to which Ball responded during the fourth quarter of 2016. A group of de minimis PRPs, including Ball, have retained a technical consultant to assist with their positions vis-à-vis larger PRPs. Total site remediation costs of $342 million, to cover remediation of approximately 200 acres of river bottom, are expected according to the proposed remediation action plan, which does not include $100 million that has already been spent, and which will be allocated among the numerous PRPs in due course. Based on the information available to the company at this time, we do not believe that this matter will have a material adverse effect upon the liquidity, results of operations or financial condition of the company. In February 2012, Ball Metal Beverage Container Corp. (BMBCC) filed an action against Crown Packaging Technology, Inc. (Crown) in the U.S. District Court for the Southern District of Ohio seeking a declaratory judgment that the sale and use of certain ends by BMBCC and its customers do not infringe certain claims of Crown’s U.S. patents. Crown subsequently filed a counterclaim alleging infringement of certain claims in these patents seeking unspecified monetary damages, fees and declaratory and injunctive relief. The District Court issued a claim construction order at the end of December 2015 and held a scheduling conference on February 10, 2016, to determine the timeline for future steps in the litigation. The case was stayed by mutual agreement of the parties into the third quarter of 2016, during which Crown made preparations for its discovery with respect to certain ends previously produced by Rexam, with such discovery expected to begin during the first half of 2017. Based on the information available to the company at the present time, the company does not believe that this matter will have a material adverse effect upon the liquidity, results of operations or financial condition of the company. On September 16, 1971, Rexham Corporation (Rexham) was incorporated as a wholly owned subsidiary of Riegel Paper Company (Riegel). On September 23, 1971, Riegel, Federal Paper Board Company (Federal), and Rexham entered into an Agreement and Plan of Reorganization (the 1971 Agreement) pursuant to which Riegel spun-off its packaging business into the newly formed Rexham. Federal retained Riegel’s paper group pursuant to a merger with Riegel. International Paper Company (International Paper) and Georgia Pacific Corporation (Georgia Pacific) are successors to Riegel. Image Products Group, LLC (IPG) is the successor to Rexham. Rexam Inc. (RI) sold IPG to Sun Coating Acquisition Corp. (Sun) in 2002 and agreed to indemnify Sun and IPG for certain environmental liabilities of Rexham. On November 4, 2011, International Paper and Georgia Pacific filed a complaint against RI and IPG alleging that pursuant to the 1971 Agreement, IPG and RI are liable for 50 percent of the clean-up costs at the Crown Vantage Landfill (the Site). The Site is an inactive industrial landfill on the Delaware River in Hunterdon County, New Jersey that was operated by Riegel and its successors from the 1930’s to the 1970’s. The EPA conducted an emergency clean up at the Site after a 2004 flood exposed drums and other waste. Georgia Pacific took over the clean-up at the Site. Georgia Pacific later sued International Paper as a successor to Riegel. Georgia Pacific and International Paper entered into a settlement agreement under which International Paper accepted responsibility for the Site. The litigation against IPG and RI centers on the interpretation of the 1971 Agreement and whether it allocated the Site liabilities to the paper group of Riegel, which merged with and into Federal, a predecessor of International Paper, or to the packaging group of Riegel, which was spun off to Rexham. Georgia Pacific and International Paper claim they have incurred past costs at the Site of approximately $14 million, and that Rexam’s share of these costs is approximately $7 million. Georgia Pacific and International Paper have also asserted that they have incurred $30 million in remediation costs at the Curtis Paper Superfund site, the former paper mill adjacent to the Site. In addition, Georgia Pacific, International Paper and the EPA have claimed that Rexam is responsible for certain other non-material amounts associated with the Curtis Paper and related sites. On October 17, 2016, representatives of Ball/Rexam and Georgia Pacific and International Paper participated in a court ordered mediation in New Jersey in an attempt to resolve this matter. No resolution was reached. Trial is scheduled for the third quarter of 2017, and we will continue to explore various ways to reach an acceptable result and otherwise mitigate the effect of the claims. Based on the information available to the company at this time, we do not believe that this matter will have a material adverse effect upon the liquidity, results of operations or financial condition of the company. A former Rexam Personal Care site in Annecy, France was found in 2003 to be contaminated following a leak of chlorinated solvents (TCE) from an underground feedline. The site underwent extensive investigation and an active remediation treatment system was put in place during 2006. The business operating from the site was sold to Albea in 2013 and in turn to a French company CATIDOM (operating as Reboul). Reboul vacated the site in September 2014, and the site reverted back to Rexam during the first quarter of 2015. As part of the site closure regulatory requirements, a new regulatory permit (Prefectoral Order) was issued in June 2016, which includes requirements to undertake a cost-benefit analysis and pilot studies of further treatment for the known residual solvent contamination following the shutdown of the current on-site treatment system. A new management plan will be proposed to the French Environmental Authorities (DREAL) in 2017. Based on the information available to the company at this time, we do not believe that this matter will have a material adverse effect upon the liquidity, results of operations or financial condition of the company. The company’s operations in Brazil are involved in various governmental assessments, principally related to claims for taxes on the internal transfer of inventory, gross revenue taxes and indirect tax incentives. The company does not believe that the ultimate resolution of these matters will materially impact the company’s results of operations, financial position or cash flows. Under customary local regulations, the company’s Brazilian subsidiaries may need to post cash or other collateral if the process to challenge any administrative assessment proceeds to the Brazilian court system; however, the level of any potential cash or collateral required would not significantly impact the liquidity of those subsidiaries or Ball Corporation. The company is continuing to evaluate various lawsuits, claims and proceedings, to which subsidiaries of Rexam are a party, including those described in this Note 18. Certain of these lawsuits, claims and proceedings, including several environmental matters and several governmental assessments in Brazil, may involve substantial amounts. If the company determines that any such matters are material, further details will be provided regarding these matters and their impact on the company’s results of operations, liquidity or financial condition. |
Indemnifications and Guarantees
Indemnifications and Guarantees | 3 Months Ended |
Mar. 31, 2017 | |
Indemnifications and Guarantees | |
Indemnifications and Guarantees | 19. Indemnifications and Guarantees General Guarantees The company or its appropriate consolidated direct or indirect subsidiaries, including Rexam and its subsidiaries, have made certain indemnities, commitments and guarantees under which the specified entity may be required to make payments in relation to certain transactions. These indemnities, commitments and guarantees include indemnities to the customers of the subsidiaries in connection with the sales of their packaging and aerospace products and services; guarantees to suppliers of subsidiaries of the company guaranteeing the performance of the respective entity under a purchase agreement, construction contract or other commitment; guarantees in respect of certain foreign subsidiaries’ pension plans; indemnities for liabilities associated with the infringement of third party patents, trademarks or copyrights under various types of agreements; indemnities to various lessors in connection with facility, equipment, furniture and other personal property leases for certain claims arising from such leases; indemnities to governmental agencies in connection with the issuance of a permit or license to the company or a subsidiary; indemnities pursuant to agreements relating to certain joint ventures; indemnities in connection with the sale of businesses or substantially all of the assets and specified liabilities of businesses; and indemnities to directors, officers and employees of the company to the extent permitted under the laws of the State of Indiana and the United States of America. The duration of these indemnities, commitments and guarantees varies and, in certain cases, is indefinite. In addition, many of these indemnities, commitments and guarantees do not provide for any limitation on the maximum potential future payments the company could be obligated to make. As such, the company is unable to reasonably estimate its potential exposure under these items. Other than the indemnifications in connection with the sale of the Divestment Business, the company has not recorded any material liabilities for these indemnities, commitments and guarantees in the accompanying consolidated balance sheets. The company does, however, accrue for payments under promissory notes and other evidences of incurred indebtedness and for losses for any known contingent liability, including those that may arise from indemnifications, commitments and guarantees, when future payment is both reasonably estimable and probable. Finally, the company carries specific and general liability insurance policies and has obtained indemnities, commitments and guarantees from third party purchasers, sellers and other contracting parties, which the company believes would, in certain circumstances, provide recourse to any claims arising from these indemnifications, commitments and guarantees. Debt Guarantees The company’s and its subsidiaries’ obligations under the senior notes and senior credit facilities (or, in the case of U.S. domiciled foreign subsidiaries under the senior credit facilities, the obligations of foreign credit parties only) are guaranteed on a full, unconditional and joint and several basis by certain of the company’s domestic subsidiaries and the domestic subsidiary borrowers, and obligations of other guarantors and the subsidiary borrowers under the senior credit facilities are guaranteed by the company, in each case with certain exceptions and subject to grace periods. These guarantees are required in support of the senior notes and senior credit facilities referred to above, are co-terminous with the terms of the respective note indentures, senior notes and credit agreement and could be enforced by the holders of the obligations thereunder during the continuation of an event of default under the note indentures, the senior notes or the credit agreement or any other loan document in respect thereof. The maximum potential amounts which could be required to be paid under such guarantees are essentially equal to the then outstanding obligations under the respective senior notes or the credit agreement (or, in the case of U.S. domiciled foreign subsidiaries under the senior credit facilities, the obligations of foreign credit parties only), with certain exceptions. All obligations under the guarantees of the senior credit facilities are secured, with certain exceptions and subject to certain grace periods, by a valid first priority perfected lien or pledge on (i) 100 percent of the capital stock of each of the company's material wholly owned domestic subsidiaries directly owned by the company or any of its wholly owned domestic subsidiaries and (ii) 65 percent of the capital stock of each of the company's material wholly owned first-tier foreign subsidiaries directly owned by the company or any of its wholly owned domestic subsidiaries. In addition, the obligations of certain foreign borrowers and foreign pledgors under the loan documents will be secured, with certain exceptions and subject to certain grace periods, by a valid first priority perfected lien or pledge on 100 percent of the capital stock of certain of the company's material wholly owned foreign subsidiaries and material wholly-owned U.S. domiciled foreign subsidiaries directly owned by the company or any of its wholly-owned material subsidiaries. The company is not in default under the above senior notes or senior credit facilities. The unaudited condensed consolidating financial information for the guarantor and non-guarantor subsidiaries is presented in Note 20. Separate financial statements for the guarantor subsidiaries and the non-guarantor subsidiaries are not presented because management has determined that such financial statements are not required by the current regulations. |
Subsidiary Guarantees of Debt
Subsidiary Guarantees of Debt | 3 Months Ended |
Mar. 31, 2017 | |
Subsidiary Guarantees of Debt | |
Subsidiary Guarantee of Debt | 20. Subsidiary Guarantees of Debt The following condensed consolidating financial information is presented in accordance with SEC Regulations S‑X Rule 3-10, Financial statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered, and comprises two separate and distinct presentations. For purposes of each presentation of condensed consolidating financial information, the subsidiaries of the company providing the guarantees are referred to as the guarantor subsidiaries, and subsidiaries of the company other than the guarantor subsidiaries are referred to as the non-guarantor subsidiaries. The eliminating adjustments substantively consist of intercompany transactions and the elimination of equity investments and earnings of subsidiaries. Separate financial statements for the guarantor subsidiaries and the non-guarantor subsidiaries are not presented because management has determined that such financial statements are not required. Guarantees Relating to Shelf Registration Statement The first presentation of condensed consolidating financial information relates to the Registration Statement on Form S-3 registering debt securities of the company and the full and unconditional, joint and several guarantees of such debt securities by certain 100 percent owned domestic subsidiaries of the company. The following is unaudited condensed consolidating financial information for the company, segregating the guarantor subsidiaries and non-guarantor subsidiaries, as of March 31, 2017, and December 31, 2016, and for the three months ended March 31, 2017 and 2016. The condensed consolidating financial information presented below is not necessarily indicative of the financial position, results of operations, earnings or cash flows of the company or any of the company’s subsidiaries on a stand-alone basis. Unaudited Condensed Consolidating Statement of Earnings Three Months Ended March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Net sales $ — $ 1,115 $ 1,373 $ (15) $ 2,473 Cost and expenses Cost of sales (excluding depreciation and amortization) — (903) (1,087) 15 (1,975) Depreciation and amortization (2) (36) (110) — (148) Selling, general and administrative (45) (41) (57) — (143) Business consolidation and other activities (51) 6 (10) — (55) Equity in results of subsidiaries 123 4 — (127) — Intercompany 81 (43) (38) — — 106 (1,013) (1,302) (112) (2,321) Earnings (loss) before interest and taxes 106 102 71 (127) 152 Interest expense (65) 1 (4) — (68) Total interest expense (65) 1 (4) — (68) Earnings (loss) before taxes 41 103 67 (127) 84 Tax (provision) benefit 27 (37) (12) — (22) Equity in results of affiliates, net of tax — — 8 — 8 Net earnings (loss) 68 66 63 (127) 70 Less net earnings attributable to noncontrolling interests — — (2) — (2) Net earnings (loss) attributable to Ball Corporation $ 68 $ 66 $ 61 $ (127) $ 68 Comprehensive earnings (loss) attributable to Ball Corporation $ 196 $ 159 $ 146 $ (305) $ 196 Unaudited Condensed Consolidating Statement of Earnings Three Months Ended March 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Net sales $ — $ 1,075 $ 706 $ (25) $ 1,756 Cost and expenses Cost of sales (excluding depreciation and amortization) — (886) (555) 25 (1,416) Depreciation and amortization (1) (36) (38) — (75) Selling, general and administrative (20) (40) (48) — (108) Business consolidation and other activities (260) (17) 10 — (267) Equity in results of subsidiaries 84 36 — (120) — Intercompany 52 (41) (11) — — (145) (984) (642) (95) (1,866) Earnings (loss) before interest and taxes (145) 91 64 (120) (110) Interest expense (38) — — — (38) Debt refinancing and other costs (59) — (2) — (61) Total interest expense (97) — (2) — (99) Earnings (loss) before taxes (242) 91 62 (120) (209) Tax (provision) benefit 115 (19) (13) — 83 Equity in results of affiliates, net of tax — (1) — — (1) Net earnings (loss) (127) 71 49 (120) (127) Less net earnings attributable to noncontrolling interests — — — — — Net earnings (loss) attributable to $ (127) $ 71 $ 49 $ (120) $ (127) Ball Corporation Comprehensive earnings (loss) attributable to Ball Corporation $ (96) $ 100 $ 66 $ (166) $ (96) Unaudited Condensed Consolidating Balance Sheet March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Assets Current assets Cash and cash equivalents $ 5 $ — $ 453 $ — $ 458 Receivables, net 77 551 1,067 — 1,695 Intercompany receivables 41 117 941 (1,099) — Inventories, net — 565 989 — 1,554 Other current assets 33 48 119 — 200 Total current assets 156 1,281 3,569 (1,099) 3,907 Noncurrent assets Property, plant and equipment, net 23 1,116 3,264 — 4,403 Investment in subsidiaries 8,039 2,372 79 (10,490) — Goodwill 3 981 4,168 — 5,152 Intangible assets, net 18 76 1,823 — 1,917 Other assets 80 23 1,162 — 1,265 Total assets $ 8,319 $ 5,849 $ 14,065 $ (11,589) $ 16,644 Liabilities and Shareholders' Equity Current liabilities Short-term debt and current portion of long-term debt $ 258 $ — $ 239 $ — $ 497 Accounts payable 15 679 1,136 — 1,830 Intercompany payables 1,012 39 60 (1,111) — Accrued employee costs 25 92 147 — 264 Other current liabilities 156 72 199 — 427 Total current liabilities 1,466 882 1,781 (1,111) 3,018 Noncurrent liabilities Long-term debt 6,493 — 983 — 7,476 Employee benefit obligations 331 445 711 — 1,487 Intercompany long-term notes (3,370) 421 2,937 12 — Deferred taxes (227) 226 856 — 855 Other liabilities 7 (1) 79 — 85 Total liabilities 4,700 1,973 7,347 (1,099) 12,921 Common stock 1,040 635 4,426 (5,061) 1,040 Preferred stock — — 5 (5) — Retained earnings 4,784 3,960 2,650 (6,610) 4,784 Accumulated other comprehensive earnings (loss) (813) (719) (467) 1,186 (813) Treasury stock, at cost (1,392) — — — (1,392) Total Ball Corporation shareholders' equity 3,619 3,876 6,614 (10,490) 3,619 Noncontrolling interests — — 104 — 104 Total shareholders' equity 3,619 3,876 6,718 (10,490) 3,723 Total liabilities and shareholders' equity $ 8,319 $ 5,849 $ 14,065 $ (11,589) $ 16,644 Unaudited Condensed Consolidating Balance Sheet December 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Assets Current assets Cash and cash equivalents $ 2 $ (11) $ 606 $ — $ 597 Receivables, net 96 450 945 — 1,491 Intercompany receivables 39 125 963 (1,127) — Inventories, net — 516 897 — 1,413 Other current assets 40 33 79 — 152 Total current assets 177 1,113 3,490 (1,127) 3,653 Noncurrent assets Property, plant and equipment, net 23 1,087 3,277 — 4,387 Investment in subsidiaries 7,815 2,289 79 (10,183) — Goodwill — 990 4,105 — 5,095 Intangible assets, net 18 76 1,840 — 1,934 Other assets 94 20 990 — 1,104 Total assets $ 8,127 $ 5,575 $ 13,781 $ (11,310) $ 16,173 Liabilities and Shareholders' Equity Current liabilities Short-term debt and current portion of long-term debt $ 141 $ — $ 81 $ — $ 222 Accounts payable 18 771 1,244 — 2,033 Intercompany payables 1,010 52 65 (1,127) — Accrued employee costs 25 135 155 — 315 Other current liabilities 138 65 196 — 399 Total current liabilities 1,332 1,023 1,741 (1,127) 2,969 Noncurrent liabilities Long-term debt 6,337 — 973 — 7,310 Employee benefit obligations 347 440 710 — 1,497 Intercompany long-term notes (3,142) 178 2,964 — — Deferred taxes (193) 218 734 — 759 Other liabilities 12 — 85 — 97 Total liabilities 4,693 1,859 7,207 (1,127) 12,632 Common stock 1,038 635 4,426 (5,061) 1,038 Preferred stock — — 5 (5) — Retained earnings 4,739 3,893 2,589 (6,482) 4,739 Accumulated other comprehensive earnings (loss) (942) (812) (552) 1,365 (941) Treasury stock, at cost (1,401) — — — (1,401) Total Ball Corporation shareholders' equity 3,434 3,716 6,468 (10,183) 3,435 Noncontrolling interests — — 106 — 106 Total shareholders' equity 3,434 3,716 6,574 (10,183) 3,541 Total liabilities and shareholders' equity $ 8,127 $ 5,575 $ 13,781 $ (11,310) $ 16,173 Unaudited Condensed Consolidating Statement of Cash Flows Three Months Ended March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Consolidated Cash provided by (used in) operating activities $ 7 $ (182) $ (223) $ (398) Cash flows from investing activities capital expenditures (4) (82) (39) (125) Business dispositions, net of cash sold — 31 — 31 Other, net 2 8 (7) 3 Cash provided by (used in) investing activities (2) (43) (46) (91) Cash flows from financing activities Long-term borrowings 185 — — 185 Repayments of long-term borrowings (48) — (2) (50) Net change in short-term borrowings 116 — 157 273 Proceeds from issuances of common stock, net of shares used for taxes (1) — — (1) Acquisitions of treasury stock (3) — — (3) Common dividends (23) — — (23) Intercompany (229) 237 (8) — Other, net — (1) — (1) Cash provided by (used in) financing activities (3) 236 147 380 Effect of exchange rate changes on cash 1 — (31) (30) Change in cash and cash equivalents 3 11 (153) (139) Cash and cash equivalents – beginning of period 2 (11) 606 597 Cash and cash equivalents – end of period $ 5 $ — $ 453 $ 458 Unaudited Condensed Consolidating Statement of Cash Flows Three Months Ended March 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Consolidated Cash provided by (used in) operating activities $ (36) $ (130) $ (220) $ (386) Cash flows from investing activities capital expenditures (7) (44) (87) (138) Business acquisition, net of cash acquired — (36) — (36) Other, net (13) 2 — (11) Cash provided by (used in) investing activities (20) (78) (87) (185) Cash flows from financing activities Long-term borrowings 795 — 6 801 Repayments of long-term borrowings (390) — (17) (407) Net change in short-term borrowings 98 — 212 310 Proceeds from issuances of common stock, net of shares used for taxes 7 — — 7 Acquisitions of treasury stock (98) — — (98) Common dividends (19) — — (19) Intercompany (331) 214 117 — Other, net (13) — (9) (22) Cash provided by (used in) financing activities 49 214 309 572 Effect of exchange rate changes on cash 5 17 (42) (20) Change in cash and cash equivalents (2) 23 (40) (19) Cash and cash equivalents – beginning of period 5 — 219 224 Cash and cash equivalents – end of period $ 3 $ 23 $ 179 $ 205 Guarantees Relating to Senior Notes The second presentation of condensed consolidating financial information relates to the existing senior notes issued by the company, and the full and unconditional guarantee of such senior notes on a joint and several basis by certain domestic subsidiaries of the company. Each of the guarantor subsidiaries is 100 percent owned by the company. As described in the supplemental indentures governing the company’s existing senior notes, the senior notes are to be guaranteed by any of the company’s domestic subsidiaries that guarantee any other indebtedness of the company. The following is unaudited condensed consolidating financial information for the company, segregating the guarantor subsidiaries and non-guarantor subsidiaries, as of March 31, 2017, and December 31, 2016 and for the three months ended March 31, 2017 and 2016. The condensed consolidating financial information presented below is not necessarily indicative of the financial position, results of operations, earnings or cash flows of the company or any of the company’s subsidiaries on a stand-alone basis. Unaudited Condensed Consolidating Statement of Earnings Three Months Ended March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Net sales $ — $ 1,115 $ 1,373 $ (15) $ 2,473 Cost and expenses Cost of sales (excluding depreciation and amortization) — (903) (1,087) 15 (1,975) Depreciation and amortization (2) (36) (110) — (148) Selling, general and administrative (45) (41) (57) — (143) Business consolidation and other activities (51) 5 (9) — (55) Equity in results of subsidiaries 123 3 (7) (119) — Intercompany 81 (41) (40) — — 106 (1,013) (1,310) (104) (2,321) Earnings (loss) before interest and taxes 106 102 63 (119) 152 Interest expense (65) 1 (4) — (68) Total interest expense (65) 1 (4) — (68) Earnings (loss) before taxes 41 103 59 (119) 84 Tax (provision) benefit 27 (37) (12) — (22) Equity in results of affiliates, net of tax — — 8 — 8 Net earnings (loss) 68 66 55 (119) 70 Less net earnings attributable to noncontrolling interests — — (2) — (2) Net earnings (loss) attributable to Ball Corporation $ 68 $ 66 $ 53 $ (119) $ 68 Comprehensive earnings (loss) attributable to Ball Corporation $ 196 $ 168 $ 144 $ (312) $ 196 Unaudited Condensed Consolidating Statement of Earnings Three Months Ended March 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Net sales $ — $ 1,075 $ 706 $ (25) $ 1,756 Cost and expenses Cost of sales (excluding depreciation and amortization) — (886) (555) 25 (1,416) Depreciation and amortization (1) (36) (38) — (75) Selling, general and administrative (20) (40) (48) — (108) Business consolidation and other activities (260) (4) (3) — (267) Equity in results of subsidiaries 84 36 — (120) — Intercompany 52 (41) (11) — — (145) (971) (655) (95) (1,866) Earnings (loss) before interest and taxes (145) 104 51 (120) (110) Interest expense (38) — — — (38) Debt refinancing and other costs (59) — (2) — (61) Total interest expense (97) — (2) — (99) Earnings (loss) before taxes (242) 104 49 (120) (209) Tax (provision) benefit 115 (19) (13) — 83 Equity in results of affiliates, net of tax — (1) — — (1) Net earnings (loss) (127) 84 36 (120) (127) Less net earnings attributable to noncontrolling interests — — — — — Net earnings (loss) attributable to $ (127) $ 84 $ 36 $ (120) $ (127) Ball Corporation Comprehensive earnings (loss) attributable to Ball Corporation $ (96) $ 113 $ 53 $ (166) $ (96) Unaudited Condensed Consolidating Balance Sheet March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Assets Current assets Cash and cash equivalents $ 5 $ — $ 453 $ — $ 458 Receivables, net 77 551 1,067 — 1,695 Intercompany receivables 41 465 941 (1,447) — Inventories, net — 565 989 — 1,554 Other current assets 33 54 113 — 200 Total current assets 156 1,635 3,563 (1,447) 3,907 Noncurrent assets Property, plant and equipment, net 23 1,116 3,264 — 4,403 Investment in subsidiaries 8,039 4,380 424 (12,843) — Goodwill 3 977 4,172 — 5,152 Intangible assets, net 18 76 1,823 — 1,917 Other assets 80 297 888 — 1,265 Total assets $ 8,319 $ 8,481 $ 14,134 $ (14,290) $ 16,644 Liabilities and Shareholders' Equity Current liabilities Short-term debt and current portion of long-term debt $ 258 $ — $ 239 $ — $ 497 Accounts payable 15 680 1,135 — 1,830 Intercompany payables 1,012 40 408 (1,460) — Accrued employee costs 25 103 136 — 264 Other current liabilities 156 76 195 — 427 Total current liabilities 1,466 899 2,113 (1,460) 3,018 Noncurrent liabilities Long-term debt 6,493 — 983 — 7,476 Employee benefit obligations 331 754 402 — 1,487 Intercompany long-term notes (3,370) 2,278 1,079 13 — Deferred taxes (227) 268 814 — 855 Other liabilities 7 (1) 79 — 85 Total liabilities 4,700 4,198 5,470 (1,447) 12,921 Common stock 1,040 1,120 6,301 (7,421) 1,040 Preferred stock — — 5 (5) — Retained earnings 4,784 3,898 2,715 (6,613) 4,784 Accumulated other comprehensive earnings (loss) (813) (735) (461) 1,196 (813) Treasury stock, at cost (1,392) — — — (1,392) Total Ball Corporation shareholders' equity 3,619 4,283 8,560 (12,843) 3,619 Noncontrolling interests — — 104 — 104 Total shareholders' equity 3,619 4,283 8,664 (12,843) 3,723 Total liabilities and shareholders' equity $ 8,319 $ 8,481 $ 14,134 $ (14,290) $ 16,644 Unaudited Condensed Consolidating Balance Sheet December 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Assets Current assets Cash and cash equivalents $ 2 $ (11) $ 606 $ — $ 597 Receivables, net 96 450 945 — 1,491 Intercompany receivables 39 467 963 (1,469) — Inventories, net — 516 897 — 1,413 Other current assets 40 39 73 — 152 Total current assets 177 1,461 3,484 (1,469) 3,653 Noncurrent assets Property, plant and equipment, net 23 1,087 3,277 — 4,387 Investment in subsidiaries 7,815 4,291 423 (12,529) — Goodwill — 985 4,110 — 5,095 Intangible assets, net 18 76 1,840 — 1,934 Other assets 94 306 704 — 1,104 Total assets $ 8,127 $ 8,206 $ 13,838 $ (13,998) $ 16,173 Liabilities and Shareholders' Equity Current liabilities Short-term debt and current portion of long-term debt $ 141 $ — $ 81 $ — $ 222 Accounts payable 18 772 1,243 — 2,033 Intercompany payables 1,010 53 408 (1,471) — Accrued employee costs 25 152 138 — 315 Other current liabilities 138 69 192 — 399 Total current liabilities 1,332 1,046 2,062 (1,471) 2,969 Noncurrent liabilities Long-term debt 6,337 — 973 — 7,310 Employee benefit obligations 347 760 390 — 1,497 Intercompany long-term notes (3,142) 2,018 1,122 2 — Deferred taxes (193) 261 691 — 759 Other liabilities 12 6 79 — 97 Total liabilities 4,693 4,091 5,317 (1,469) 12,632 Common stock 1,038 1,120 6,301 (7,421) 1,038 Preferred stock — — 5 (5) — Retained earnings 4,739 3,832 2,661 (6,493) 4,739 Accumulated other comprehensive earnings (loss) (942) (837) (552) 1,390 (941) Treasury stock, at cost (1,401) — — — (1,401) Total Ball Corporation shareholders' equity 3,434 4,115 8,415 (12,529) 3,435 Noncontrolling interests — — 106 — 106 Total shareholders' equity 3,434 4,115 8,521 (12,529) 3,541 Total liabilities and shareholders' equity $ 8,127 $ 8,206 $ 13,838 $ (13,998) $ 16,173 Unaudited Condensed Consolidating Statement of Cash Flows Three Months Ended March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Consolidated Cash provided by (used in) operating activities $ 7 $ (194) $ (211) $ (398) Cash flows from investing activities capital expenditures (4) (82) (39) (125) Proceeds from dispositions, net of cash sold — 31 — 31 Other, net 2 8 (7) 3 Cash provided by (used in) investing activities (2) (43) (46) (91) Cash flows from financing activities Long-term borrowings 185 — — 185 Repayments of long-term borrowings (48) — (2) (50) Net change in short-term borrowings 116 — 157 273 Proceeds from issuances of common stock, net of shares used for taxes (1) — — (1) Acquisitions of treasury stock (3) — — (3) Common dividends (23) — — (23) Intercompany (229) 249 (20) — Other, net — (1) — (1) Cash provided by (used in) financing activities (3) 248 135 380 Effect of exchange rate changes on cash 1 — (31) (30) Change in cash and cash equivalents 3 11 (153) (139) Cash and cash equivalents – beginning of period 2 (11) 606 597 Cash and cash equivalents – end of period $ 5 $ — $ 453 $ 458 Unaudited Condensed Consolidating Statement of Cash Flows Three Months Ended March 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Consolidated Cash provided by (used in) operating activities $ (36) $ (130) $ (220) $ (386) Cash flows from investing activities capital expenditures (7) (44) (87) (138) Business acquisition, net of cash acquired — (36) — (36) Other, net (13) 2 — (11) Cash provided by (used in) investing activities (20) (78) (87) (185) Cash flows from financing activities Long-term borrowings 795 — 6 801 Repayments of long-term borrowings (390) — (17) (407) Net change in short-term borrowings 98 — 212 310 Proceeds from issuances of common stock, net of shares used for taxes 7 — — 7 Acquisitions of treasury stock (98) — — (98) Common dividends (19) — — (19) Intercompany (331) 196 135 — Other, net (13) — (9) (22) Cash provided by (used in) financing activities 49 196 327 572 Effect of exchange rate changes on cash 5 17 (42) (20) Change in cash and cash equivalents (2) 5 (22) (19) Cash and cash equivalents – beginning of period 5 — 219 224 Cash and cash equivalents – end of period $ 3 $ 5 $ 197 $ 205 |
Business Segment Information (T
Business Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Business Segment Information | |
Summary of business by segment | ` Three Months Ended March 31, ($ in millions) 2017 2016 Net sales Beverage packaging, North and Central America $ 949 $ 734 Beverage packaging, South America 371 126 Beverage packaging, Europe 508 356 Food and aerosol packaging 272 284 Aerospace 236 180 Reportable segment sales 2,336 1,680 Other 137 76 Net sales $ 2,473 $ 1,756 Comparable operating earnings Beverage packaging, North and Central America $ 123 $ 93 Beverage packaging, South America 58 18 Beverage packaging, Europe 47 39 Food and aerosol packaging 21 20 Aerospace 21 18 Reportable segment comparable operating earnings 270 188 Reconciling items Other (a) (31) (31) Business consolidation and other activities (55) (267) Amortization of acquired Rexam intangibles (32) — Earnings (loss) before interest and taxes 152 (110) Interest expense (68) (38) Debt refinancing and other costs — (61) Total interest expense (68) (99) Earnings (loss) before taxes 84 (209) Tax (provision) benefit (22) 83 Equity in results of affiliates, net of tax 8 (1) Net earnings (loss) 70 (127) Less net earnings attributable to noncontrolling interests (2) — Net earnings (loss) attributable to Ball Corporation $ 68 $ (127) (a) Includes undistributed corporate expenses, net, of $45 million and $22 million for the first quarter of 2017 and 2016, respectively. |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Acquisitions and Dispositions | |
Summary of divestment business | Three Months Ended March 31, ($ in millions) 2016 Earnings before taxes $ 37 Earnings before taxes attributable to Ball Corporation $ 37 |
Summary of net assets acquired | June 30, ($ in millions) 2016 Cash $ 450 Receivables, net 775 Inventories, net 792 Other current assets 164 Assets held for sale (sold to Ardagh on June 30, 2016) 913 Total current assets 3,094 Property, plant and equipment 2,296 Goodwill 3,799 Intangible assets 1,888 Restricted cash 174 Other assets 439 Total assets acquired 11,690 Short-term debt and current portion of long-term debt 2,792 Accounts payable 870 Accrued employee costs 135 Liabilities held for sale (sold to Ardagh on June 30, 2016) 7 Other current liabilities 377 Total current liabilities 4,181 Long-term debt 28 Employee benefit obligations 508 Deferred taxes and other liabilities 723 Total liabilities assumed 5,440 Net assets acquired 6,250 Noncontrolling interests (90) Aggregate value of consideration paid $ 6,160 |
Summary of certain intangible assets | ($ in millions) Fair Value Weighted- Customer relationships $ 1,840 15 Trademarks 40 5 Technology 8 9 $ 1,888 |
Summary of unaudited pro forma consolidated results of operations | Three Months Ended March 31, ($ in millions, except per share amounts) 2016 Net sales (1) $ 2,418 Net earnings attributable to Ball Corporation (2) 22 Basic earnings per share 0.13 Diluted earnings per share 0.12 (1) Net sales were adjusted to include net sales of Rexam. The company also excluded the net sales attributable to the Divestment Business. (2) Pro forma adjustments to net earnings attributable to Ball Corporation were adjusted as follows: · Excludes acquisition-related transaction costs and debt refinancing costs incurred in the three months ended March 31, 2016. · Includes interest expense associated with the new debt utilized to finance the acquisition. · Includes depreciation and amortization expense based on the increased fair value of property, plant and equipment and amortizable intangible assets acquired. · Excludes net earnings attributable to the Divestment Business for the three months ended March 31, 2016. |
Business Consolidation and Ot29
Business Consolidation and Other Activities (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Business Consolidation and Other Activities | |
Summary of business consolidation and other activity (charges) / income included in the condensed consolidated statements of earnings | Three Months Ended March 31, ($ in millions) 2017 2016 Beverage packaging, North and Central America $ (4) $ (3) Beverage packaging, South America 3 — Beverage packaging, Europe (3) (4) Food and aerosol packaging 10 (14) Other (61) (246) $ (55) $ (267) |
Receivables (Tables)
Receivables (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Receivables | |
Schedule of receivables | March 31, December 31, ($ in millions) 2017 2016 Trade accounts receivable $ 1,365 $ 1,169 Less allowance for doubtful accounts (11) (11) Net trade accounts receivable 1,354 1,158 Other receivables 341 333 $ 1,695 $ 1,491 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Inventories | |
Schedule of inventories | March 31, December 31, ($ in millions) 2017 2016 Raw materials and supplies $ 653 $ 607 Work-in-process and finished goods 930 839 Less inventory reserves (29) (33) $ 1,554 $ 1,413 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment | |
Schedule of property, plant and equipment | March 31, December 31, ($ in millions) 2017 2016 Land $ 101 $ 105 Buildings 1,313 1,301 Machinery and equipment 4,872 4,723 Construction-in-progress 454 503 6,740 6,632 Accumulated depreciation (2,337) (2,245) $ 4,403 $ 4,387 |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets | |
Schedule of goodwill | ($ in millions) Beverage Beverage Beverage Food Aerospace Other Total Balance at December 31, 2016 $ 1,614 $ 970 $ 1,632 $ 599 $ 40 $ 240 $ 5,095 Opening balance sheet adjustments 18 4 — — — — 22 Business dispositions — — — (9) — — (9) Effects of currency exchange rates — — 40 2 — 2 44 Balance at March 31, 2017 $ 1,632 $ 974 $ 1,672 $ 592 $ 40 $ 242 $ 5,152 |
Intangible Assets,net (Tables)
Intangible Assets,net (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets | |
Schedule of Finite-Lived Intangible Assets | March 31, December 31, ($ in millions) 2017 2016 Acquired Rexam intangibles (net of accumulated amortization of $96 million at March 31, 2017, and $62 million at December 31, 2016) $ 1,752 $ 1,766 Capitalized software (net of accumulated amortization of $92 million at March 31, 2017, and $87 million at December 31, 2016) 77 79 Other intangibles (net of accumulated amortization of $149 million at March 31, 2017, and $143 million at December 31, 2016) 88 89 $ 1,917 $ 1,934 |
Other Assets (Tables)
Other Assets (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Other Assets.. | |
Schedule of other assets | March 31, December 31, ($ in millions) 2017 2016 Long-term deferred tax assets $ 575 $ 443 Long-term pension asset 154 147 Investments in affiliates 213 204 Company and trust-owned life insurance 156 146 Other 167 164 $ 1,265 $ 1,104 |
Debt and Interest Costs (Tables
Debt and Interest Costs (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Debt and Interest Costs | |
Schedule of long-term debt | March 31, December 31, ($ in millions) 2017 2016 Senior Notes 5.25% due July 2025 $ 1,000 $ 1,000 4.375% due December 2020 1,000 1,000 4.00% due November 2023 1,000 1,000 4.375%, euro denominated, due December 2023 746 736 5.00% due March 2022 750 750 3.50%, euro denominated, due December 2020 426 421 Senior Credit Facilities, due March 2021 (at variable rates) Term A loan, due June 2021 1,365 1,383 Term A loan, euro denominated, due June 2021 967 954 Multi-currency USD revolver, due March 2021 345 190 Other (including debt issuance costs) (44) (45) 7,555 7,389 Less: Current portion of long-term debt (79) (79) $ 7,476 $ 7,310 |
Schedule of Debt Refinancing and Other Costs | Three Months Ended March 31, ($ in millions) 2017 2016 Debt Refinancing and Other Costs: Interest expense on 3.5% and 4.375% senior notes $ — $ (25) Economic hedge - interest rate risk — (16) Refinance of bridge and revolving credit facilities — (13) Amortization of unsecured, committed bridge facility financing fees — (7) $ — $ (61) |
Employee Benefit Obligations (T
Employee Benefit Obligations (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Employee Benefit Obligations | |
Schedule of employee benefit obligations | March 31, December 31, ($ in millions) 2017 2016 Underfunded defined benefit pension liabilities $ 969 $ 963 Less current portion (21) (25) Long-term defined benefit pension liabilities 948 938 Retiree medical and other postemployment benefits 219 226 Deferred compensation plans 261 272 Other 59 61 $ 1,487 $ 1,497 |
Components of net periodic benefit cost | Three Months Ended March 31, 2017 2016 ($ in millions) U.S. Foreign Total U.S. Foreign Total Ball-sponsored plans: Service cost $ 12 $ 4 $ 16 $ 12 $ 3 $ 15 Interest cost 33 22 55 15 5 20 Expected return on plan assets (33) (26) (59) (18) (5) (23) Recognized net actuarial loss 9 1 10 8 1 9 Net periodic benefit cost for Ball sponsored plans 21 1 22 17 4 21 Net periodic benefit cost for multi-employer plans 1 — 1 — — — Total net periodic benefit cost $ 22 $ 1 $ 23 $ 17 $ 4 $ 21 |
Shareholders_ Equity and Comp38
Shareholders’ Equity and Comprehensive Earnings (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Shareholders’ Equity | |
Schedule of activity related to accumulated other comprehensive earnings (loss) | ($ in millions) Foreign Currency Translation (Net of Tax) Pension and Other Postretirement Benefits (Net of Tax) Effective Derivatives (Net of Tax) Accumulated Other Comprehensive Earnings (Loss) Balance at December 31, 2016 $ (329) $ (590) $ (22) $ (941) Other comprehensive earnings (loss) before reclassifications 69 (4) 33 98 Amounts reclassified from accumulated other comprehensive earnings (loss) — 6 24 30 Balance at March 31, 2017 $ (260) $ (588) $ 35 $ (813) |
Information related to amounts recognized into net earnings from accumulated other comprehensive earnings (loss) | Three Months Ended March 31, ($ in millions) 2017 2016 Gains (losses) on cash flow hedges: Commodity contracts recorded in net sales $ (3) $ 3 Commodity contracts recorded in cost of sales 8 (7) Currency exchange contracts recorded in business consolidation and other activities 3 (1) Cross currency swaps recorded in selling, general and administrative (17) — Total before tax effect (9) (5) Tax benefit (expense) on amounts reclassified into earnings (15) 1 Recognized gain (loss) $ (24) $ (4) Amortization of pension and other postretirement benefits (a) : Prior service income (expense) $ — $ 1 Actuarial gains (losses) (9) (9) Total before tax effect (9) (8) Tax benefit (expense) on amounts reclassified into earnings 3 3 Recognized gain (loss) $ (6) $ (5) (a) The pension components are included in the computation of net periodic benefit cost included in Note 13. |
Stock-Based Compensation Prog39
Stock-Based Compensation Programs (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Stock-Based Compensation Programs | |
Schedule of weighted average assumptions used for estimating fair values of options | January 2017 July 2016 January 2016 Expected dividend yield 0.68 % 0.73 % 0.79 % Expected stock price volatility 20.49 % 24.14 % 29.25 % Risk-free interest rate 2.07 % 1.22 % 1.57 % Expected life of options (in years) 5.94 years 6.10 years 5.94 years |
Earnings and Dividends Per Sh40
Earnings and Dividends Per Share (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share | |
Schedule of earnings per share | Three Months Ended March 31, ($ in millions, except per share amounts; shares in thousands) 2017 2016 Net earnings attributable to Ball Corporation $ 68 $ (127) Basic weighted average common shares 175,024 141,793 Effect of dilutive securities 3,943 — Weighted average shares applicable to diluted earnings per share 178,967 141,793 Per basic share $ 0.39 $ (0.90) Per diluted share $ 0.38 $ (0.90) |
Schedule of pro forma earnings per share | Three Months Ended March 31, ($ in millions, except per share amounts; shares in thousands) 2017 2016 Net earnings attributable to Ball Corporation $ 68 $ (127) Basic weighted average common shares 350,048 283,586 Effect of dilutive securities 7,886 — Weighted average shares applicable to diluted earnings per share 357,934 283,586 Per basic share $ 0.19 $ (0.45) Per diluted share $ 0.19 $ (0.45) |
Financial Instruments and Ris41
Financial Instruments and Risk Management (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Financial Instruments and Risk Management | |
Schedule of fair value of derivative instruments | March 31, 2017 December 31, 2016 ($ in millions) Derivatives Derivatives not Total Derivatives Derivatives not Total Assets: Commodity contracts $ 63 $ 3 $ 66 $ 17 $ 1 $ 18 Foreign currency contracts — 21 21 1 — 1 Interest rate and other contracts — — — — 21 21 Total current derivative contracts $ 63 $ 24 $ 87 $ 18 $ 22 $ 40 Commodity contracts $ 15 $ — $ 15 $ 7 $ — $ 7 Foreign currency contracts 1 — 1 — — — Interest rate and other contracts 27 — 27 39 — 39 Total noncurrent derivative contracts $ 43 $ — $ 43 $ 46 $ — $ 46 Liabilities: Commodity contracts $ 14 $ 1 $ 15 $ 3 $ — $ 3 Foreign currency contracts — 5 5 — 22 22 Interest rate and other contracts — 1 1 — — — Total current derivative contracts $ 14 $ 7 $ 21 $ 3 $ 22 $ 25 |
Schedule of impact on earnings from derivative instruments | Three Months Ended March 31, 2017 2016 ($ in millions) Location of Gain (Loss) Cash Flow Gain (Loss) on Cash Flow Gain (Loss) on Commodity contracts - manage exposure to customer pricing Net sales $ (3) $ — $ 3 $ — Commodity contracts - manage exposure to supplier pricing Cost of sales 8 — (7) — Interest rate contracts - manage exposure for forecasted Rexam financing Debt refinancing and other costs — — — (16) Foreign currency contracts - manage general exposure with the business Selling, general and administrative — (15) (1) — Foreign currency contracts - manage exposure for acquisition of Rexam Business consolidation and other activities 3 — — (88) Cross-currency swaps - manage exposure for acquisition of Rexam Business consolidation and other activities — — — (36) Cross-currency swaps - manage intercompany currency exposure within the business Selling, general and administrative (17) — — — Equity contracts Selling, general and administrative — (2) — (2) Total $ (9) $ (17) $ (5) $ (142) |
Schedule of changes in accumulated other comprehensive earnings (loss) for effective derivatives | Three Months Ended March 31, ($ in millions) 2017 2016 Amounts reclassified into earnings: Commodity contracts $ (5) $ 4 Cross currency swap contracts 17 — Currency exchange contracts (3) 1 Change in fair value of cash flow hedges: Commodity contracts 51 (6) Interest rate contracts — (2) Cross currency swap contracts (12) — Currency exchange contracts 3 3 Foreign currency and tax impacts 6 — $ 57 $ — |
Subsidiary Guarantees of Debt (
Subsidiary Guarantees of Debt (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Schedule of Condensed Consolidating Statement of Earnings | Unaudited Condensed Consolidating Statement of Earnings Three Months Ended March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Net sales $ — $ 1,115 $ 1,373 $ (15) $ 2,473 Cost and expenses Cost of sales (excluding depreciation and amortization) — (903) (1,087) 15 (1,975) Depreciation and amortization (2) (36) (110) — (148) Selling, general and administrative (45) (41) (57) — (143) Business consolidation and other activities (51) 6 (10) — (55) Equity in results of subsidiaries 123 4 — (127) — Intercompany 81 (43) (38) — — 106 (1,013) (1,302) (112) (2,321) Earnings (loss) before interest and taxes 106 102 71 (127) 152 Interest expense (65) 1 (4) — (68) Total interest expense (65) 1 (4) — (68) Earnings (loss) before taxes 41 103 67 (127) 84 Tax (provision) benefit 27 (37) (12) — (22) Equity in results of affiliates, net of tax — — 8 — 8 Net earnings (loss) 68 66 63 (127) 70 Less net earnings attributable to noncontrolling interests — — (2) — (2) Net earnings (loss) attributable to Ball Corporation $ 68 $ 66 $ 61 $ (127) $ 68 Comprehensive earnings (loss) attributable to Ball Corporation $ 196 $ 159 $ 146 $ (305) $ 196 Unaudited Condensed Consolidating Statement of Earnings Three Months Ended March 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Net sales $ — $ 1,075 $ 706 $ (25) $ 1,756 Cost and expenses Cost of sales (excluding depreciation and amortization) — (886) (555) 25 (1,416) Depreciation and amortization (1) (36) (38) — (75) Selling, general and administrative (20) (40) (48) — (108) Business consolidation and other activities (260) (17) 10 — (267) Equity in results of subsidiaries 84 36 — (120) — Intercompany 52 (41) (11) — — (145) (984) (642) (95) (1,866) Earnings (loss) before interest and taxes (145) 91 64 (120) (110) Interest expense (38) — — — (38) Debt refinancing and other costs (59) — (2) — (61) Total interest expense (97) — (2) — (99) Earnings (loss) before taxes (242) 91 62 (120) (209) Tax (provision) benefit 115 (19) (13) — 83 Equity in results of affiliates, net of tax — (1) — — (1) Net earnings (loss) (127) 71 49 (120) (127) Less net earnings attributable to noncontrolling interests — — — — — Net earnings (loss) attributable to $ (127) $ 71 $ 49 $ (120) $ (127) Ball Corporation Comprehensive earnings (loss) attributable to Ball Corporation $ (96) $ 100 $ 66 $ (166) $ (96) |
Schedule of Condensed Consolidating Balance Sheet | Unaudited Condensed Consolidating Balance Sheet March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Assets Current assets Cash and cash equivalents $ 5 $ — $ 453 $ — $ 458 Receivables, net 77 551 1,067 — 1,695 Intercompany receivables 41 117 941 (1,099) — Inventories, net — 565 989 — 1,554 Other current assets 33 48 119 — 200 Total current assets 156 1,281 3,569 (1,099) 3,907 Noncurrent assets Property, plant and equipment, net 23 1,116 3,264 — 4,403 Investment in subsidiaries 8,039 2,372 79 (10,490) — Goodwill 3 981 4,168 — 5,152 Intangible assets, net 18 76 1,823 — 1,917 Other assets 80 23 1,162 — 1,265 Total assets $ 8,319 $ 5,849 $ 14,065 $ (11,589) $ 16,644 Liabilities and Shareholders' Equity Current liabilities Short-term debt and current portion of long-term debt $ 258 $ — $ 239 $ — $ 497 Accounts payable 15 679 1,136 — 1,830 Intercompany payables 1,012 39 60 (1,111) — Accrued employee costs 25 92 147 — 264 Other current liabilities 156 72 199 — 427 Total current liabilities 1,466 882 1,781 (1,111) 3,018 Noncurrent liabilities Long-term debt 6,493 — 983 — 7,476 Employee benefit obligations 331 445 711 — 1,487 Intercompany long-term notes (3,370) 421 2,937 12 — Deferred taxes (227) 226 856 — 855 Other liabilities 7 (1) 79 — 85 Total liabilities 4,700 1,973 7,347 (1,099) 12,921 Common stock 1,040 635 4,426 (5,061) 1,040 Preferred stock — — 5 (5) — Retained earnings 4,784 3,960 2,650 (6,610) 4,784 Accumulated other comprehensive earnings (loss) (813) (719) (467) 1,186 (813) Treasury stock, at cost (1,392) — — — (1,392) Total Ball Corporation shareholders' equity 3,619 3,876 6,614 (10,490) 3,619 Noncontrolling interests — — 104 — 104 Total shareholders' equity 3,619 3,876 6,718 (10,490) 3,723 Total liabilities and shareholders' equity $ 8,319 $ 5,849 $ 14,065 $ (11,589) $ 16,644 Unaudited Condensed Consolidating Balance Sheet December 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Assets Current assets Cash and cash equivalents $ 2 $ (11) $ 606 $ — $ 597 Receivables, net 96 450 945 — 1,491 Intercompany receivables 39 125 963 (1,127) — Inventories, net — 516 897 — 1,413 Other current assets 40 33 79 — 152 Total current assets 177 1,113 3,490 (1,127) 3,653 Noncurrent assets Property, plant and equipment, net 23 1,087 3,277 — 4,387 Investment in subsidiaries 7,815 2,289 79 (10,183) — Goodwill — 990 4,105 — 5,095 Intangible assets, net 18 76 1,840 — 1,934 Other assets 94 20 990 — 1,104 Total assets $ 8,127 $ 5,575 $ 13,781 $ (11,310) $ 16,173 Liabilities and Shareholders' Equity Current liabilities Short-term debt and current portion of long-term debt $ 141 $ — $ 81 $ — $ 222 Accounts payable 18 771 1,244 — 2,033 Intercompany payables 1,010 52 65 (1,127) — Accrued employee costs 25 135 155 — 315 Other current liabilities 138 65 196 — 399 Total current liabilities 1,332 1,023 1,741 (1,127) 2,969 Noncurrent liabilities Long-term debt 6,337 — 973 — 7,310 Employee benefit obligations 347 440 710 — 1,497 Intercompany long-term notes (3,142) 178 2,964 — — Deferred taxes (193) 218 734 — 759 Other liabilities 12 — 85 — 97 Total liabilities 4,693 1,859 7,207 (1,127) 12,632 Common stock 1,038 635 4,426 (5,061) 1,038 Preferred stock — — 5 (5) — Retained earnings 4,739 3,893 2,589 (6,482) 4,739 Accumulated other comprehensive earnings (loss) (942) (812) (552) 1,365 (941) Treasury stock, at cost (1,401) — — — (1,401) Total Ball Corporation shareholders' equity 3,434 3,716 6,468 (10,183) 3,435 Noncontrolling interests — — 106 — 106 Total shareholders' equity 3,434 3,716 6,574 (10,183) 3,541 Total liabilities and shareholders' equity $ 8,127 $ 5,575 $ 13,781 $ (11,310) $ 16,173 |
Schedule of Condensed Consolidating Statement of Cash Flows | Unaudited Condensed Consolidating Statement of Cash Flows Three Months Ended March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Consolidated Cash provided by (used in) operating activities $ 7 $ (182) $ (223) $ (398) Cash flows from investing activities capital expenditures (4) (82) (39) (125) Business dispositions, net of cash sold — 31 — 31 Other, net 2 8 (7) 3 Cash provided by (used in) investing activities (2) (43) (46) (91) Cash flows from financing activities Long-term borrowings 185 — — 185 Repayments of long-term borrowings (48) — (2) (50) Net change in short-term borrowings 116 — 157 273 Proceeds from issuances of common stock, net of shares used for taxes (1) — — (1) Acquisitions of treasury stock (3) — — (3) Common dividends (23) — — (23) Intercompany (229) 237 (8) — Other, net — (1) — (1) Cash provided by (used in) financing activities (3) 236 147 380 Effect of exchange rate changes on cash 1 — (31) (30) Change in cash and cash equivalents 3 11 (153) (139) Cash and cash equivalents – beginning of period 2 (11) 606 597 Cash and cash equivalents – end of period $ 5 $ — $ 453 $ 458 Unaudited Condensed Consolidating Statement of Cash Flows Three Months Ended March 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Consolidated Cash provided by (used in) operating activities $ (36) $ (130) $ (220) $ (386) Cash flows from investing activities capital expenditures (7) (44) (87) (138) Business acquisition, net of cash acquired — (36) — (36) Other, net (13) 2 — (11) Cash provided by (used in) investing activities (20) (78) (87) (185) Cash flows from financing activities Long-term borrowings 795 — 6 801 Repayments of long-term borrowings (390) — (17) (407) Net change in short-term borrowings 98 — 212 310 Proceeds from issuances of common stock, net of shares used for taxes 7 — — 7 Acquisitions of treasury stock (98) — — (98) Common dividends (19) — — (19) Intercompany (331) 214 117 — Other, net (13) — (9) (22) Cash provided by (used in) financing activities 49 214 309 572 Effect of exchange rate changes on cash 5 17 (42) (20) Change in cash and cash equivalents (2) 23 (40) (19) Cash and cash equivalents – beginning of period 5 — 219 224 Cash and cash equivalents – end of period $ 3 $ 23 $ 179 $ 205 |
Guarantees Relating to Senior Notes | |
Schedule of Condensed Consolidating Statement of Earnings | Unaudited Condensed Consolidating Statement of Earnings Three Months Ended March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Net sales $ — $ 1,115 $ 1,373 $ (15) $ 2,473 Cost and expenses Cost of sales (excluding depreciation and amortization) — (903) (1,087) 15 (1,975) Depreciation and amortization (2) (36) (110) — (148) Selling, general and administrative (45) (41) (57) — (143) Business consolidation and other activities (51) 5 (9) — (55) Equity in results of subsidiaries 123 3 (7) (119) — Intercompany 81 (41) (40) — — 106 (1,013) (1,310) (104) (2,321) Earnings (loss) before interest and taxes 106 102 63 (119) 152 Interest expense (65) 1 (4) — (68) Total interest expense (65) 1 (4) — (68) Earnings (loss) before taxes 41 103 59 (119) 84 Tax (provision) benefit 27 (37) (12) — (22) Equity in results of affiliates, net of tax — — 8 — 8 Net earnings (loss) 68 66 55 (119) 70 Less net earnings attributable to noncontrolling interests — — (2) — (2) Net earnings (loss) attributable to Ball Corporation $ 68 $ 66 $ 53 $ (119) $ 68 Comprehensive earnings (loss) attributable to Ball Corporation $ 196 $ 168 $ 144 $ (312) $ 196 Unaudited Condensed Consolidating Statement of Earnings Three Months Ended March 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Net sales $ — $ 1,075 $ 706 $ (25) $ 1,756 Cost and expenses Cost of sales (excluding depreciation and amortization) — (886) (555) 25 (1,416) Depreciation and amortization (1) (36) (38) — (75) Selling, general and administrative (20) (40) (48) — (108) Business consolidation and other activities (260) (4) (3) — (267) Equity in results of subsidiaries 84 36 — (120) — Intercompany 52 (41) (11) — — (145) (971) (655) (95) (1,866) Earnings (loss) before interest and taxes (145) 104 51 (120) (110) Interest expense (38) — — — (38) Debt refinancing and other costs (59) — (2) — (61) Total interest expense (97) — (2) — (99) Earnings (loss) before taxes (242) 104 49 (120) (209) Tax (provision) benefit 115 (19) (13) — 83 Equity in results of affiliates, net of tax — (1) — — (1) Net earnings (loss) (127) 84 36 (120) (127) Less net earnings attributable to noncontrolling interests — — — — — Net earnings (loss) attributable to $ (127) $ 84 $ 36 $ (120) $ (127) Ball Corporation Comprehensive earnings (loss) attributable to Ball Corporation $ (96) $ 113 $ 53 $ (166) $ (96) |
Schedule of Condensed Consolidating Balance Sheet | Unaudited Condensed Consolidating Balance Sheet March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Assets Current assets Cash and cash equivalents $ 5 $ — $ 453 $ — $ 458 Receivables, net 77 551 1,067 — 1,695 Intercompany receivables 41 465 941 (1,447) — Inventories, net — 565 989 — 1,554 Other current assets 33 54 113 — 200 Total current assets 156 1,635 3,563 (1,447) 3,907 Noncurrent assets Property, plant and equipment, net 23 1,116 3,264 — 4,403 Investment in subsidiaries 8,039 4,380 424 (12,843) — Goodwill 3 977 4,172 — 5,152 Intangible assets, net 18 76 1,823 — 1,917 Other assets 80 297 888 — 1,265 Total assets $ 8,319 $ 8,481 $ 14,134 $ (14,290) $ 16,644 Liabilities and Shareholders' Equity Current liabilities Short-term debt and current portion of long-term debt $ 258 $ — $ 239 $ — $ 497 Accounts payable 15 680 1,135 — 1,830 Intercompany payables 1,012 40 408 (1,460) — Accrued employee costs 25 103 136 — 264 Other current liabilities 156 76 195 — 427 Total current liabilities 1,466 899 2,113 (1,460) 3,018 Noncurrent liabilities Long-term debt 6,493 — 983 — 7,476 Employee benefit obligations 331 754 402 — 1,487 Intercompany long-term notes (3,370) 2,278 1,079 13 — Deferred taxes (227) 268 814 — 855 Other liabilities 7 (1) 79 — 85 Total liabilities 4,700 4,198 5,470 (1,447) 12,921 Common stock 1,040 1,120 6,301 (7,421) 1,040 Preferred stock — — 5 (5) — Retained earnings 4,784 3,898 2,715 (6,613) 4,784 Accumulated other comprehensive earnings (loss) (813) (735) (461) 1,196 (813) Treasury stock, at cost (1,392) — — — (1,392) Total Ball Corporation shareholders' equity 3,619 4,283 8,560 (12,843) 3,619 Noncontrolling interests — — 104 — 104 Total shareholders' equity 3,619 4,283 8,664 (12,843) 3,723 Total liabilities and shareholders' equity $ 8,319 $ 8,481 $ 14,134 $ (14,290) $ 16,644 Unaudited Condensed Consolidating Balance Sheet December 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Eliminating Consolidated Assets Current assets Cash and cash equivalents $ 2 $ (11) $ 606 $ — $ 597 Receivables, net 96 450 945 — 1,491 Intercompany receivables 39 467 963 (1,469) — Inventories, net — 516 897 — 1,413 Other current assets 40 39 73 — 152 Total current assets 177 1,461 3,484 (1,469) 3,653 Noncurrent assets Property, plant and equipment, net 23 1,087 3,277 — 4,387 Investment in subsidiaries 7,815 4,291 423 (12,529) — Goodwill — 985 4,110 — 5,095 Intangible assets, net 18 76 1,840 — 1,934 Other assets 94 306 704 — 1,104 Total assets $ 8,127 $ 8,206 $ 13,838 $ (13,998) $ 16,173 Liabilities and Shareholders' Equity Current liabilities Short-term debt and current portion of long-term debt $ 141 $ — $ 81 $ — $ 222 Accounts payable 18 772 1,243 — 2,033 Intercompany payables 1,010 53 408 (1,471) — Accrued employee costs 25 152 138 — 315 Other current liabilities 138 69 192 — 399 Total current liabilities 1,332 1,046 2,062 (1,471) 2,969 Noncurrent liabilities Long-term debt 6,337 — 973 — 7,310 Employee benefit obligations 347 760 390 — 1,497 Intercompany long-term notes (3,142) 2,018 1,122 2 — Deferred taxes (193) 261 691 — 759 Other liabilities 12 6 79 — 97 Total liabilities 4,693 4,091 5,317 (1,469) 12,632 Common stock 1,038 1,120 6,301 (7,421) 1,038 Preferred stock — — 5 (5) — Retained earnings 4,739 3,832 2,661 (6,493) 4,739 Accumulated other comprehensive earnings (loss) (942) (837) (552) 1,390 (941) Treasury stock, at cost (1,401) — — — (1,401) Total Ball Corporation shareholders' equity 3,434 4,115 8,415 (12,529) 3,435 Noncontrolling interests — — 106 — 106 Total shareholders' equity 3,434 4,115 8,521 (12,529) 3,541 Total liabilities and shareholders' equity $ 8,127 $ 8,206 $ 13,838 $ (13,998) $ 16,173 |
Schedule of Condensed Consolidating Statement of Cash Flows | Unaudited Condensed Consolidating Statement of Cash Flows Three Months Ended March 31, 2017 ($ in millions) Ball Guarantor Non-Guarantor Consolidated Cash provided by (used in) operating activities $ 7 $ (194) $ (211) $ (398) Cash flows from investing activities capital expenditures (4) (82) (39) (125) Proceeds from dispositions, net of cash sold — 31 — 31 Other, net 2 8 (7) 3 Cash provided by (used in) investing activities (2) (43) (46) (91) Cash flows from financing activities Long-term borrowings 185 — — 185 Repayments of long-term borrowings (48) — (2) (50) Net change in short-term borrowings 116 — 157 273 Proceeds from issuances of common stock, net of shares used for taxes (1) — — (1) Acquisitions of treasury stock (3) — — (3) Common dividends (23) — — (23) Intercompany (229) 249 (20) — Other, net — (1) — (1) Cash provided by (used in) financing activities (3) 248 135 380 Effect of exchange rate changes on cash 1 — (31) (30) Change in cash and cash equivalents 3 11 (153) (139) Cash and cash equivalents – beginning of period 2 (11) 606 597 Cash and cash equivalents – end of period $ 5 $ — $ 453 $ 458 Unaudited Condensed Consolidating Statement of Cash Flows Three Months Ended March 31, 2016 ($ in millions) Ball Guarantor Non-Guarantor Consolidated Cash provided by (used in) operating activities $ (36) $ (130) $ (220) $ (386) Cash flows from investing activities capital expenditures (7) (44) (87) (138) Business acquisition, net of cash acquired — (36) — (36) Other, net (13) 2 — (11) Cash provided by (used in) investing activities (20) (78) (87) (185) Cash flows from financing activities Long-term borrowings 795 — 6 801 Repayments of long-term borrowings (390) — (17) (407) Net change in short-term borrowings 98 — 212 310 Proceeds from issuances of common stock, net of shares used for taxes 7 — — 7 Acquisitions of treasury stock (98) — — (98) Common dividends (19) — — (19) Intercompany (331) 196 135 — Other, net (13) — (9) (22) Cash provided by (used in) financing activities 49 196 327 572 Effect of exchange rate changes on cash 5 17 (42) (20) Change in cash and cash equivalents (2) 5 (22) (19) Cash and cash equivalents – beginning of period 5 — 219 224 Cash and cash equivalents – end of period $ 3 $ 5 $ 197 $ 205 |
Accounting Pronouncements (Deta
Accounting Pronouncements (Details) | Mar. 31, 2017USD ($) |
New Accounting Pronouncements, Retrospective adjustments | |
Prior period adjustments due to new accounting principle | $ 0 |
Cumulative effect adjustment to opening retained earnings, after tax | $ 0 |
Business Segment Information (D
Business Segment Information (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2017USD ($)segment | Mar. 31, 2016USD ($) | |
Business Segment Information | ||
Number of reportable segments | segment | 5 | |
Segment Reporting Information, Revenue for Reportable Segment [Abstract] | ||
Net sales | $ 2,473 | $ 1,756 |
Reconciling items | ||
Other | (31) | (31) |
Business consolidation and other activities | (55) | (267) |
Amortization of acquired Rexam intangibles | (32) | |
Earnings (loss) before interest and taxes | 152 | (110) |
Interest expense | (68) | (38) |
Debt refinancing and other costs | (61) | |
Total interest expense | (68) | (99) |
Earnings (loss) before taxes | 84 | (209) |
Tax (provision) benefit | (22) | 83 |
Equity in results of affiliates, net of tax | 8 | (1) |
Net earnings (loss) | 70 | (127) |
Less net earnings attributable to noncontrolling interests | (2) | |
Net earnings (loss) attributable to Ball Corporation | 68 | (127) |
Undistributed corporate expenses | 45 | 22 |
Other | ||
Segment Reporting Information, Revenue for Reportable Segment [Abstract] | ||
Net sales | 137 | 76 |
Reconciling items | ||
Business consolidation and other activities | (61) | (246) |
Operating Segments | ||
Segment Reporting Information, Revenue for Reportable Segment [Abstract] | ||
Net sales | 2,336 | 1,680 |
Segment Reporting Information, Operating Income (Loss) [Abstract] | ||
Reportable segment comparable operating earnings | 270 | 188 |
Operating Segments | Metal beverage packaging, North And Central America | ||
Segment Reporting Information, Revenue for Reportable Segment [Abstract] | ||
Net sales | 949 | 734 |
Segment Reporting Information, Operating Income (Loss) [Abstract] | ||
Reportable segment comparable operating earnings | 123 | 93 |
Reconciling items | ||
Business consolidation and other activities | (4) | (3) |
Operating Segments | Metal beverage packaging, South America | ||
Segment Reporting Information, Revenue for Reportable Segment [Abstract] | ||
Net sales | 371 | 126 |
Segment Reporting Information, Operating Income (Loss) [Abstract] | ||
Reportable segment comparable operating earnings | 58 | 18 |
Reconciling items | ||
Business consolidation and other activities | 3 | |
Operating Segments | Metal beverage packaging, Europe | ||
Segment Reporting Information, Revenue for Reportable Segment [Abstract] | ||
Net sales | 508 | 356 |
Segment Reporting Information, Operating Income (Loss) [Abstract] | ||
Reportable segment comparable operating earnings | 47 | 39 |
Reconciling items | ||
Business consolidation and other activities | (3) | (4) |
Operating Segments | Food and aerosol packaging | ||
Segment Reporting Information, Revenue for Reportable Segment [Abstract] | ||
Net sales | 272 | 284 |
Segment Reporting Information, Operating Income (Loss) [Abstract] | ||
Reportable segment comparable operating earnings | 21 | 20 |
Reconciling items | ||
Business consolidation and other activities | 10 | (14) |
Operating Segments | Aerospace | ||
Segment Reporting Information, Revenue for Reportable Segment [Abstract] | ||
Net sales | 236 | 180 |
Segment Reporting Information, Operating Income (Loss) [Abstract] | ||
Reportable segment comparable operating earnings | $ 21 | $ 18 |
Acquisitions and Dispositions (
Acquisitions and Dispositions (Details) $ / shares in Units, £ in Billions | Jun. 30, 2016GBP (£)facility | Jun. 30, 2016USD ($)facility$ / sharesshares | Aug. 31, 2016USD ($) | Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) |
Rexam | |||||
Purchase price, net of cash acquired | $ 36,000,000 | ||||
Number of manufacturing facilities held at the end of the period | facility | 75 | ||||
Divestment Business | |||||
Business consolidation and other activities | $ 55,000,000 | 267,000,000 | |||
Divestment Business | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||
Rexam | |||||
Number of manufacturing facilities sold | facility | 22 | 22 | |||
Divestment Business | |||||
Divestiture consideration received | $ 3,420,000,000 | ||||
Proceeds to be received under supply agreement | 103,000,000 | ||||
Earnings before taxes | 37,000,000 | ||||
Earnings before taxes attributable to Ball Corporation | 37,000,000 | ||||
Divestment Business | Disposal Group, Disposed of by Sale, Not Discontinued Operations | Maximum | |||||
Divestment Business | |||||
Potential contingent payment required | $ 75,000,000 | ||||
North America | Divestment Business | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||
Rexam | |||||
Number of manufacturing facilities sold | facility | 8 | 8 | |||
Europe | Divestment Business | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||
Rexam | |||||
Number of manufacturing facilities sold | facility | 12 | 12 | |||
Brazil | Divestment Business | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||
Rexam | |||||
Number of manufacturing facilities sold | facility | 2 | 2 | |||
Ball Corporation | |||||
Divestment Business | |||||
Business consolidation and other activities | 51,000,000 | 260,000,000 | |||
Ball Corporation | Divestment Business | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||
Rexam | |||||
Number of manufacturing facilities sold | facility | 12 | 12 | |||
Rexam | Divestment Business | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||
Rexam | |||||
Number of manufacturing facilities sold | facility | 10 | 10 | |||
Rexam | |||||
Rexam | |||||
Percentage of shares acquired | 100.00% | ||||
Purchase price, net of cash acquired | £ 2.9 | $ 3,800,000,000 | |||
Share price | $ / shares | $ 71.39 | ||||
Value of common shares issued | $ 2,300,000,000 | ||||
Number of manufacturing facilities acquired | facility | 54 | 54 | |||
Rexam debt assumed | $ 2,792,000,000 | ||||
Rexam | North America | |||||
Rexam | |||||
Number of manufacturing facilities acquired | facility | 17 | 17 | |||
Rexam | Europe | |||||
Rexam | |||||
Number of manufacturing facilities acquired | facility | 20 | 20 | |||
Rexam | South America | |||||
Rexam | |||||
Number of manufacturing facilities acquired | facility | 12 | 12 | |||
Rexam | AMEA | |||||
Rexam | |||||
Number of manufacturing facilities acquired | facility | 5 | 5 | |||
Rexam | Ball Corporation | |||||
Rexam | |||||
Number of treasury shares issued | shares | 32,250,000 | ||||
Senior Notes 4.375 Percent, due December 2020 | |||||
Rexam | |||||
Face amount of debt | $ 1,000,000,000 | ||||
Rexam Long Term Debt Assumed (Member) | Rexam | |||||
Rexam | |||||
Rexam debt assumed | $ 2,800,000,000 | ||||
Assumed debt extinguished | $ 2,700,000,000 | ||||
Business consolidation and other activities | |||||
Rexam | |||||
Pre-tax transaction costs related to the acquisition | 216,000,000 | ||||
Business consolidation and other activities | Divestment Business | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||
Divestment Business | |||||
Pre-tax gain recorded in connection with sale | 330,000,000 | ||||
Business consolidation and other activities | 27,000,000 | ||||
Business consolidation and other activities | Current Liabilities | Divestment Business | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||
Divestment Business | |||||
Estimated value of the claims under this indemnity | $ 50,000,000 | ||||
Business consolidation and other activities | Rexam | |||||
Rexam | |||||
Pre-tax transaction costs related to the acquisition | $ 216,000,000 |
Acquisitions and Dispositions -
Acquisitions and Dispositions - Net assets acquired (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2016 |
Assets and Liabilities Acquired | |||
Goodwill | $ 5,152 | $ 5,095 | |
Ball Corporation | |||
Assets and Liabilities Acquired | |||
Goodwill | $ 3 | ||
Rexam | |||
Assets and Liabilities Acquired | |||
Cash | $ 450 | ||
Receivables, net | 775 | ||
Inventories, net | 792 | ||
Other current assets | 164 | ||
Assets held for sale (sold to Ardagh on June 30, 2016) | 913 | ||
Total current assets | 3,094 | ||
Property, plant and equipment | 2,296 | ||
Goodwill | 3,799 | ||
Intangible assets | 1,888 | ||
Restricted cash | 174 | ||
Other Assets | 439 | ||
Total assets acquired | 11,690 | ||
Short-term debt and current portion of long-term debt | 2,792 | ||
Accounts payable | 870 | ||
Accrued employee costs | 135 | ||
Liabilities held for sale | 7 | ||
Other current liabilities | 377 | ||
Total current liabilities | 4,181 | ||
Long term debt | 28 | ||
Employee benefit obligations | 508 | ||
Deferred taxes and other liabilities | 723 | ||
Total liabilities assumed | (5,440) | ||
Net assets acquired | 6,250 | ||
Noncontrolling interests | (90) | ||
Aggregate value of consideration paid | $ 6,160 |
Acquisitions and Dispositions47
Acquisitions and Dispositions - Intangible assets (Details) - Rexam $ in Millions | Jun. 30, 2016USD ($) |
Certain intangible assets | |
Fair Value | $ 1,888 |
Customer relationships | |
Certain intangible assets | |
Fair Value | $ 1,840 |
Weighted-Average Estimated Useful Life (in Years) | 15 years |
Trademarks | |
Certain intangible assets | |
Fair Value | $ 40 |
Weighted-Average Estimated Useful Life (in Years) | 5 years |
Technology | |
Certain intangible assets | |
Fair Value | $ 8 |
Weighted-Average Estimated Useful Life (in Years) | 9 years |
Acquisitions and Dispositions48
Acquisitions and Dispositions - Pro forma (Details) $ / shares in Units, $ in Millions | 3 Months Ended |
Mar. 31, 2016USD ($)$ / shares | |
Acquisitions | |
Basic earnings per share | $ / shares | $ 0.13 |
Diluted earnings per share | $ / shares | $ 0.12 |
Rexam | |
Acquisitions | |
Net sales, proforma | $ | $ 2,418 |
Net earnings attributable to Ball Corporation | $ | $ 22 |
United Kingdom | Rexam | |
Acquisitions | |
Statutory tax rate used in pro forma adjustments | 20.00% |
US | Rexam | |
Acquisitions | |
Tax rate used in recording tax impact of transaction costs already incurred | 37.00% |
Acquisitions and Dispositions49
Acquisitions and Dispositions - Others (Details) $ in Millions, £ in Billions | Jun. 30, 2016GBP (£) | Jun. 30, 2016USD ($) | Mar. 31, 2017USD ($) | Oct. 31, 2016USD ($) | Jan. 31, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2016 |
Acquisitions | |||||||
Purchase price, net of cash acquired | $ 36 | ||||||
Wavefront | |||||||
Acquisitions | |||||||
Purchase price, net of cash acquired | $ 36 | ||||||
Rexam | |||||||
Acquisitions | |||||||
Purchase price, net of cash acquired | £ 2.9 | $ 3,800 | |||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Food And Aerosol Paint And General Line Plant | Hubbard, Ohio | |||||||
Disposal of business facility | |||||||
Price agreed upon for sale of plant | $ 32 | ||||||
Gain (loss) on dispositions | $ 15 | ||||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Food And Aerosol Specialty Tin Business | Baltimore, Maryland | |||||||
Disposal of business facility | |||||||
Price agreed upon for sale of plant | $ 24 | ||||||
Gain (loss) on dispositions | $ 9 | ||||||
Senior Notes 4.375 Percent, due December 2020 | |||||||
Acquisitions | |||||||
Interest rate (as a percent) | 4.375% | 4.375% | |||||
Senior Notes 3.50 Percent, euro denominated, due December 2020 | |||||||
Acquisitions | |||||||
Interest rate (as a percent) | 3.50% | 3.50% | |||||
Senior Notes 4.375 Percent, euro denominated, due December 2023 | |||||||
Acquisitions | |||||||
Interest rate (as a percent) | 4.375% | 4.375% |
Business Consolidation and Ot50
Business Consolidation and Other Activities (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Business consolidation and other activities | ||
Business consolidation and other activities | $ (55) | $ (267) |
Currency exchange contracts | (3) | 1 |
Senior Notes 4.375 Percent, due December 2020 | ||
Business consolidation and other activities | ||
Face amount of debt | 1,000 | |
Ball Corporation | ||
Business consolidation and other activities | ||
Business consolidation and other activities | (51) | (260) |
Other | ||
Business consolidation and other activities | ||
Business consolidation and other activities | (61) | (246) |
Operating Segments | Metal beverage packaging, North And Central America | ||
Business consolidation and other activities | ||
Business consolidation and other activities | (4) | (3) |
Professional Services And Other Costs | 1 | 3 |
Operating Segments | Metal beverage packaging, North And Central America | Reidsville North Carolina Plant | ||
Business consolidation and other activities | ||
Plant closure costs of employee severance and accelerated depreciation | 3 | |
Operating Segments | Metal beverage packaging, South America | ||
Business consolidation and other activities | ||
Business consolidation and other activities | 3 | |
Professional Services And Other Costs | 3 | |
Operating Segments | Metal beverage packaging, Europe | ||
Business consolidation and other activities | ||
Business consolidation and other activities | (3) | (4) |
Professional Services And Other Costs | 1 | |
Operating Segments | Metal beverage packaging, Europe | Rexam | ||
Business consolidation and other activities | ||
Professional Services And Other Costs | 2 | 4 |
Operating Segments | Food and aerosol packaging | ||
Business consolidation and other activities | ||
Business consolidation and other activities | 10 | (14) |
Charges for insignificant items | 5 | |
Professional Services And Other Costs | 2 | |
Operating Segments | Food and aerosol packaging | Weirton West Virginia Plant | ||
Business consolidation and other activities | ||
Plant closure costs comprised of employee severance, pension and other benefits, asset impairments and facility shut down and disposal costs | 9 | |
Operating Segments | Food and aerosol packaging | Weirton West Virginia Plant | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||
Business consolidation and other activities | ||
Facility shutdown costs and accelerated depreciation | 3 | |
Operating Segments | Food and aerosol packaging | Hubbard Ohio Plant | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||
Business consolidation and other activities | ||
Gain (loss) on dispositions | 15 | |
Corporate and other | ||
Business consolidation and other activities | ||
Professional Services And Other Costs | 2 | |
Corporate and other | Rexam | ||
Business consolidation and other activities | ||
Professional Services And Other Costs | 24 | |
Recognized gains (losses) associated with collar and option contracts | (88) | |
Corporate and other | Cross-currency swap | ||
Business consolidation and other activities | ||
Foreign currency unrealized loss | 36 | |
Corporate and other | Other | ||
Business consolidation and other activities | ||
Professional Services And Other Costs | 6 | |
Corporate and other | Other | Rexam | ||
Business consolidation and other activities | ||
Professional Services And Other Costs | 5 | |
Compensation arrangement expense | 9 | |
Divestment Business | Corporate and other | Rexam | ||
Business consolidation and other activities | ||
Foreign currency translation losses | $ 96 | |
Divestment Business | Corporate and other | Other | Ball Corporation | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||
Business consolidation and other activities | ||
Gain (loss) on dispositions | (14) | |
Expense of indemnifications of uncertain tax positions | $ 27 |
Receivables (Details)
Receivables (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Receivables | ||
Trade accounts receivable | $ 1,365 | $ 1,169 |
Less allowances for doubtful accounts | (11) | (11) |
Net trade accounts receivable | 1,354 | 1,158 |
Other receivables | 341 | 333 |
Receivables, net | 1,695 | 1,491 |
Maximum available sale of the accounts receivables under factoring program | 865 | |
Amount of sale of receivables | $ 542 | $ 596 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Inventories | ||
Raw materials and supplies | $ 653 | $ 607 |
Work-in-process and finished goods | 930 | 839 |
Less inventory reserves | (29) | (33) |
Inventories, net | $ 1,554 | $ 1,413 |
Property, Plant and Equipment53
Property, Plant and Equipment (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Property, plant and equipment | |||
Property, plant and equipment, gross | $ 6,740 | $ 6,632 | |
Accumulated depreciation | (2,337) | (2,245) | |
Net property, plant and equipment | 4,403 | 4,387 | |
Depreciation expense | 107 | $ 65 | |
Land | |||
Property, plant and equipment | |||
Property, plant and equipment, gross | 101 | 105 | |
Buildings | |||
Property, plant and equipment | |||
Property, plant and equipment, gross | 1,313 | 1,301 | |
Machinery and equipment | |||
Property, plant and equipment | |||
Property, plant and equipment, gross | 4,872 | 4,723 | |
Construction-in-progress | |||
Property, plant and equipment | |||
Property, plant and equipment, gross | $ 454 | $ 503 |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | |
Goodwill | |||
Balance at the beginning of the period | $ 5,095 | ||
Opening balance sheet adjustments | 22 | ||
Business disposition | (9) | ||
Effects of currency exchange rates | 44 | ||
Balance at the end of the period | 5,152 | ||
Goodwill | 5,095 | $ 5,095 | |
Rexam | |||
Goodwill | |||
Goodwill | $ 3,799 | ||
Metal beverage packaging, North And Central America | |||
Goodwill | |||
Balance at the beginning of the period | 1,614 | ||
Opening balance sheet adjustments | 18 | ||
Balance at the end of the period | 1,632 | ||
Goodwill | 1,614 | 1,614 | |
Metal beverage packaging, South America | |||
Goodwill | |||
Balance at the beginning of the period | 970 | ||
Opening balance sheet adjustments | 4 | ||
Balance at the end of the period | 974 | ||
Goodwill | 970 | 970 | |
Metal beverage packaging, Europe | |||
Goodwill | |||
Balance at the beginning of the period | 1,632 | ||
Effects of currency exchange rates | 40 | ||
Balance at the end of the period | 1,672 | ||
Goodwill | 1,632 | 1,632 | |
Food and aerosol packaging | |||
Goodwill | |||
Balance at the beginning of the period | 599 | ||
Business disposition | (9) | ||
Effects of currency exchange rates | 2 | ||
Balance at the end of the period | 592 | ||
Goodwill | 599 | 599 | |
Aerospace | |||
Goodwill | |||
Balance at the beginning of the period | 40 | ||
Balance at the end of the period | 40 | ||
Goodwill | 40 | 40 | |
Other | |||
Goodwill | |||
Balance at the beginning of the period | 240 | ||
Effects of currency exchange rates | 2 | ||
Balance at the end of the period | 242 | ||
Goodwill | 240 | $ 240 | |
Metal Beverage Packaging Asia (Member) | |||
Goodwill | |||
Balance at the end of the period | 78 | ||
Percentage of fair value exceeding carrying value | 23.00% | ||
Goodwill | $ 78 |
Intangibles Assets, net (Detail
Intangibles Assets, net (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | |
Total annual intangible asset amortization expense | |||
Finite-lived intangible assets (net of accumulated amortization) | $ 88 | $ 89 | |
Accumulated amortization | 149 | $ 143 | |
Capitalized software (net of accumulated amortization) | 77 | 79 | |
Accumulated amortization - capitalized software | 92 | 87 | |
Total intangible assets, net | 1,917 | 1,934 | |
Amortization of Intangible Assets | 32 | ||
Ball Corporation | |||
Total annual intangible asset amortization expense | |||
Total intangible assets, net | 18 | 18 | |
Rexam | |||
Total annual intangible asset amortization expense | |||
Finite-lived intangible assets (net of accumulated amortization) | 1,752 | 1,766 | |
Accumulated amortization | $ 96 | $ 62 |
Other Assets (Details)
Other Assets (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Other assets | ||
Long-term deferred tax assets | $ 575 | $ 443 |
Long-term pension asset | 154 | 147 |
Investments in affiliates | 213 | 204 |
Company and trust-owned life insurance | 156 | 146 |
Other | 167 | 164 |
Other Assets | 1,265 | 1,104 |
Ball Corporation | ||
Other assets | ||
Other Assets | $ 80 | $ 94 |
Debt and Interest Costs - Long
Debt and Interest Costs - Long term debt (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Long-term debt | ||
Long-term Debt, Gross | $ 7,500 | $ 7,400 |
Other (including debt issuance costs) | (44) | (45) |
Long-term debt, Total | 7,555 | 7,389 |
Less: Current portion of long-term debt | (79) | (79) |
Long-term debt excluding current maturities | 7,476 | 7,310 |
Senior Notes 5.25 Percent, due July 2025 | ||
Long-term debt | ||
Long-term Debt, Gross | $ 1,000 | $ 1,000 |
Interest rate (as a percent) | 5.25% | 5.25% |
Senior Notes 4.375 Percent, due December 2020 | ||
Long-term debt | ||
Long-term Debt, Gross | $ 1,000 | $ 1,000 |
Interest rate (as a percent) | 4.375% | 4.375% |
Senior Notes 4.00 Percent, due November 2023 | ||
Long-term debt | ||
Long-term Debt, Gross | $ 1,000 | $ 1,000 |
Interest rate (as a percent) | 4.00% | 4.00% |
Senior Notes 4.375 Percent, euro denominated, due December 2023 | ||
Long-term debt | ||
Long-term Debt, Gross | $ 746 | $ 736 |
Interest rate (as a percent) | 4.375% | 4.375% |
Senior Notes 5.00 Percent, due March 2022 | ||
Long-term debt | ||
Long-term Debt, Gross | $ 750 | $ 750 |
Interest rate (as a percent) | 5.00% | 5.00% |
Senior Notes 3.50 Percent, euro denominated, due December 2020 | ||
Long-term debt | ||
Long-term Debt, Gross | $ 426 | $ 421 |
Interest rate (as a percent) | 3.50% | 3.50% |
Term A Loan, due June 2021 | ||
Long-term debt | ||
Long-term Debt, Gross | $ 1,365 | $ 1,383 |
Term A Loan, Euro denominated, due June 2021 | ||
Long-term debt | ||
Long-term Debt, Gross | 967 | 954 |
Multi-currency USD revolver, due March 2021 | ||
Long-term debt | ||
Long-term Debt, Gross | $ 345 | $ 190 |
Debt and Interest Costs - Debt
Debt and Interest Costs - Debt refinancing (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2016USD ($) | |
Debt Refinancing and Other Costs: (Abstract) | |
Economic hedge - interest rate risk | $ (16) |
Debt refinancing and other costs | (61) |
Senior Notes 3.5 Percent And 4.375 Percent | |
Debt Refinancing and Other Costs: (Abstract) | |
Interest expense on 3.5% and 4.375% senior notes | (25) |
Bridge And Revolving Credit Facilities | |
Debt Refinancing and Other Costs: (Abstract) | |
Refinance of bridge and revolving credit facilities | (13) |
Bridge Facility | |
Debt Refinancing and Other Costs: (Abstract) | |
Amortization of unsecured, committed bridge facility financing fees | $ (7) |
Debt and Interest Costs - Activ
Debt and Interest Costs - Activity (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017USD ($) | Dec. 31, 2017 | Dec. 31, 2016USD ($) | |
Revolving credit facility | |||
Carrying value | $ 7,500 | $ 7,400 | |
Ownership interest in guarantor subsidiaries (as a percent) | 100.00% | ||
Debt Instrument, Covenant Maximum Leverage Ratio | 5 | ||
Forecast | |||
Revolving credit facility | |||
Debt Instrument, Covenant Maximum Leverage Ratio | 4 | ||
Letter of Credit | |||
Revolving credit facility | |||
Carrying value | $ 32 | 32 | |
Level 2 | |||
Revolving credit facility | |||
Fair value of the long-term debt | 7,800 | 7,700 | |
2018 Revolver | |||
Revolving credit facility | |||
Maximum borrowing capacity of revolving credit facility | 1,500 | ||
Committed multi-currency revolving credit facilities | |||
Revolving credit facility | |||
Available borrowing capacity under line of credit facility | 1,100 | ||
Short-term uncommitted credit facilities | |||
Revolving credit facility | |||
Available borrowing capacity under line of credit facility | 902 | ||
Amount of credit facility outstanding and due on demand | $ 418 | $ 143 |
Employee Benefit Obligations -
Employee Benefit Obligations - Total (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Employee Benefit Obligations | ||
Underfunded defined benefit pension liabilities | $ 969 | $ 963 |
Less current portion | (21) | (25) |
Long-term defined benefit pension liabilities | 948 | 938 |
Retiree medical and other postemployment benefits | 219 | 226 |
Deferred compensation plans | 261 | 272 |
Other | 59 | 61 |
Total non-current employee benefit obligations | 1,487 | 1,497 |
Ball Corporation | ||
Employee Benefit Obligations | ||
Total non-current employee benefit obligations | $ 331 | $ 347 |
Employee Benefit Obligations 61
Employee Benefit Obligations - Components of net periodic benefit cost (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Defined Benefit Pension Plans | ||
Ball-sponsored plans: | ||
Service cost | $ 16 | $ 15 |
Interest cost | 55 | 20 |
Expected return on plan assets | (59) | (23) |
Recognized net actuarial loss | 10 | 9 |
Net periodic benefit cost | 22 | 21 |
Multi-employer plans: | ||
Net periodic benefit cost for multiemployer plans | 1 | |
Total net periodic benefit cost | 23 | 21 |
Defined Benefit Pension Plan Not Including German Swedish And Certain U S Plans | unfunded plan | ||
Multi-employer plans: | ||
Contributions to pension plans | 8 | 20 |
Payments to participants | 6 | |
Expected contributions to pension plans for the full year | 190 | |
Expected benefit payments to plan participants for the full year | 20 | |
U.S. | ||
Ball-sponsored plans: | ||
Service cost | 12 | 12 |
Interest cost | 33 | 15 |
Expected return on plan assets | (33) | (18) |
Recognized net actuarial loss | 9 | 8 |
Net periodic benefit cost | 21 | 17 |
Multi-employer plans: | ||
Net periodic benefit cost for multiemployer plans | 1 | |
Total net periodic benefit cost | 22 | 17 |
Foreign Plans | ||
Ball-sponsored plans: | ||
Service cost | 4 | 3 |
Interest cost | 22 | 5 |
Expected return on plan assets | (26) | (5) |
Recognized net actuarial loss | 1 | 1 |
Net periodic benefit cost | 1 | 4 |
Multi-employer plans: | ||
Total net periodic benefit cost | $ 1 | $ 4 |
Shareholders' Equity and Compre
Shareholders' Equity and Comprehensive Earnings - AOCI Activity (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($) | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |
Stockholders' Equity Attributable to Parent, Beginning Balance | $ 3,435 |
Stockholders' Equity Attributable to Parent, Ending Balance | 3,619 |
Foreign Currency Translation | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |
Stockholders' Equity Attributable to Parent, Beginning Balance | (329) |
Other comprehensive earnings (loss) before reclassifications | 69 |
Stockholders' Equity Attributable to Parent, Ending Balance | (260) |
Pension and Other Postretirement Benefits | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |
Stockholders' Equity Attributable to Parent, Beginning Balance | (590) |
Other comprehensive earnings (loss) before reclassifications | (4) |
Amounts reclassified from accumulated other comprehensive earnings (loss) | 6 |
Stockholders' Equity Attributable to Parent, Ending Balance | (588) |
Effective Derivatives | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |
Stockholders' Equity Attributable to Parent, Beginning Balance | (22) |
Other comprehensive earnings (loss) before reclassifications | 33 |
Amounts reclassified from accumulated other comprehensive earnings (loss) | 24 |
Stockholders' Equity Attributable to Parent, Ending Balance | 35 |
Accumulated Other Comprehensive Earnings (Loss) | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |
Stockholders' Equity Attributable to Parent, Beginning Balance | (941) |
Other comprehensive earnings (loss) before reclassifications | 98 |
Amounts reclassified from accumulated other comprehensive earnings (loss) | 30 |
Stockholders' Equity Attributable to Parent, Ending Balance | $ (813) |
Shareholders' Equity and Comp63
Shareholders' Equity and Comprehensive Earnings - AOCI Additional Details (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Gains (losses) on cash flow hedges | ||
Net sales | $ 2,473 | $ 1,756 |
Cost of sales (excluding depreciation and amortization) | (1,975) | (1,416) |
Selling, general and administrative | (143) | (108) |
Business consolidation and other activities | (55) | (267) |
Earnings before taxes | 84 | (209) |
Tax benefit (expense) on amounts reclassified into earnings | (22) | 83 |
Net earnings (loss) | 70 | (127) |
Effective Derivatives | Amount Reclassified from Accumulated Other Comprehensive Earnings (Loss) | ||
Gains (losses) on cash flow hedges | ||
Earnings before taxes | (9) | (5) |
Tax benefit (expense) on amounts reclassified into earnings | (15) | 1 |
Net Income (Loss) Attributable to Parent, Total | (24) | (4) |
Effective Derivatives | Amount Reclassified from Accumulated Other Comprehensive Earnings (Loss) | Commodity contracts | ||
Gains (losses) on cash flow hedges | ||
Net sales | (3) | 3 |
Cost of sales (excluding depreciation and amortization) | 8 | (7) |
Effective Derivatives | Amount Reclassified from Accumulated Other Comprehensive Earnings (Loss) | Foreign currency contracts | ||
Gains (losses) on cash flow hedges | ||
Business consolidation and other activities | 3 | (1) |
Effective Derivatives | Amount Reclassified from Accumulated Other Comprehensive Earnings (Loss) | Cross-currency swap | ||
Gains (losses) on cash flow hedges | ||
Selling, general and administrative | (17) | |
Pension and Other Postretirement Benefits | Amount Reclassified from Accumulated Other Comprehensive Earnings (Loss) | ||
Amortization Of Pension And Other Postretirement Benefits: | ||
Total before tax effect | (9) | (8) |
Tax benefit (expense) on amounts reclassified into earnings | 3 | 3 |
Recognized gain (loss) | (6) | (5) |
Prior service income (expense) | Amount Reclassified from Accumulated Other Comprehensive Earnings (Loss) | ||
Amortization Of Pension And Other Postretirement Benefits: | ||
Total before tax effect | 1 | |
Actuarial gains (losses) | Amount Reclassified from Accumulated Other Comprehensive Earnings (Loss) | ||
Amortization Of Pension And Other Postretirement Benefits: | ||
Total before tax effect | $ (9) | $ (9) |
Stock-Based Compensation Prog64
Stock-Based Compensation Programs (Details) | 1 Months Ended | 3 Months Ended | |||
Jan. 31, 2017$ / sharesshares | Jul. 31, 2016$ / shares | Jan. 31, 2016$ / shares | Mar. 31, 2017installmentshares | Mar. 31, 2016shares | |
Stock option and SSARs | |||||
Stock-Based Compensation Programs | |||||
Number of equal installments commencing one year from the date of grant | installment | 4 | ||||
Vesting period | 1 year | ||||
Expiration period of options | 10 years | ||||
Granted (in shares) | 544,724 | ||||
Weighted average fair value at grant date (in dollars per share) | $ / shares | $ 17.08 | $ 16.71 | $ 18.58 | ||
Weighted average assumptions used in estimation of fair values of options | |||||
Expected dividend yield (as a percent) | 0.68% | 0.73% | 0.79% | ||
Expected stock price volatility (as a percent) | 20.49% | 24.14% | 29.25% | ||
Risk-free interest rate (as a percent) | 2.07% | 1.22% | 1.57% | ||
Expected life of options | 5 years 11 months 9 days | 6 years 1 month 6 days | 5 years 11 months 9 days | ||
PCEQs | |||||
Stock-Based Compensation Programs | |||||
Vesting period | 3 years | ||||
Weighted average assumptions used in estimation of fair values of options | |||||
Granted (in shares) | 118,726 | 118,755 | |||
PCEQs | Minimum | |||||
Weighted average assumptions used in estimation of fair values of options | |||||
Percent of participant PCEQ award assigned that determines the number of shares available at vesting date | 0.00% | 0.00% | |||
PCEQs | Maximum | |||||
Weighted average assumptions used in estimation of fair values of options | |||||
Percent of participant PCEQ award assigned that determines the number of shares available at vesting date | 200.00% | 200.00% | |||
PCEQs | Special Acquisition Related Incentive Plan | |||||
Stock-Based Compensation Programs | |||||
Granted (in shares) | 558,986 | ||||
PCEQs | Special Acquisition Related Incentive Plan | Minimum | |||||
Weighted average assumptions used in estimation of fair values of options | |||||
Percent of participant PCEQ award assigned that determines the number of shares available at vesting date | 0.00% | ||||
PCEQs | Special Acquisition Related Incentive Plan | Maximum | |||||
Weighted average assumptions used in estimation of fair values of options | |||||
Percent of participant PCEQ award assigned that determines the number of shares available at vesting date | 200.00% |
Earnings and Dividends Per Sh65
Earnings and Dividends Per Share (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Earnings Per Share | ||
Net earnings attributable to Ball Corporation | $ 68 | $ (127) |
Basic weighted average common shares | 175,024,000 | 141,793,000 |
Effect of dilutive securities (in shares) | 3,943,000 | |
Weighted average shares applicable to diluted earnings per share | 178,967,000 | 141,793,000 |
Basic (in dollars per share) | $ 0.39 | $ (0.90) |
Diluted (in dollars per share) | $ 0.38 | (0.90) |
Weighted average number of shares that would have been applicable to diluted earnings per share if all potentially issuable securities were included | 145,100 | |
Number of outstanding options excluded from computation of diluted earnings per share | 2,000,000 | |
Dividends paid (in dollars per share) | $ 0.13 | 0.13 |
Dividends paid (in dollars per share) | $ 0.13 | $ 0.13 |
Earnings and Dividends Per Sh66
Earnings and Dividends Per Share - Pro Forma (Details) $ / shares in Units, shares in Thousands, $ in Millions | May 16, 2017$ / shares | Apr. 26, 2017 | Mar. 31, 2017USD ($)$ / sharesshares | Mar. 31, 2016USD ($)$ / sharesshares |
Earnings per share, pro forma | ||||
Net earnings attributable to Ball Corporation | $ | $ 68 | $ (127) | ||
Basic weighted average common shares | shares | 350,048 | 283,586 | ||
Effect of dilutive securities | shares | 7,886 | |||
Weighted average shares applicable to diluted earnings per share | shares | 357,934 | 283,586 | ||
Per basic share (in dollars per share) | $ 0.19 | $ (0.45) | ||
Per diluted share (in dollars per share) | 0.19 | (0.45) | ||
increased the quarterly cash dividend (in dollars per share) | $ 0.13 | $ 0.13 | ||
Subsequent Event. | ||||
Subsequent event | ||||
Stockholders' Equity Note, Stock Split, Conversion Ratio | 2 | |||
Earnings per share, pro forma | ||||
increased the quarterly cash dividend | 54.00% | |||
increased the quarterly cash dividend (in dollars per share) | $ 10 |
Financial Instruments and Ris67
Financial Instruments and Risk Management - General (Details) $ / shares in Units, item in Millions, $ in Millions | Mar. 31, 2017USD ($)itemapproach | Mar. 31, 2017USD ($)itemapproach$ / shares | Mar. 31, 2016USD ($) | Dec. 31, 2016USD ($) | Jun. 30, 2016USD ($) |
Financial Instruments and Risk Management | |||||
Costs associated with terminated interest rate contracts | $ 16 | ||||
Aggregate fair value of derivative instruments with credit-risk-related contingent features that were in a net liability position | $ 27 | $ 27 | $ 44 | ||
Collateral amount posted for derivative instruments with credit-risk-related contingent features that were in a net liability position | $ 0 | $ 0 | $ 0 | ||
Commodity contracts | |||||
Financial Instruments and Risk Management | |||||
Number of methods through which entity manages commodity price risk in connection with market price fluctuations of aluminum ingot | approach | 2 | 2 | |||
Notional amount of derivatives | $ 748 | $ 748 | |||
Gain (loss) on derivatives included in accumulated other comprehensive earnings (loss), net of tax | 51 | 51 | |||
Net gain expected to be recognized in the consolidated statement of earnings during the next 12 months | 36 | ||||
Commodity contracts | Derivatives Designated As Hedging Instruments | Cash Flow Hedging | |||||
Financial Instruments and Risk Management | |||||
Notional amount of derivatives | 680 | $ 680 | |||
Commodity contracts | Maximum | |||||
Financial Instruments and Risk Management | |||||
Period within which derivative will expire | 3 years | ||||
Interest rate swap agreements | |||||
Financial Instruments and Risk Management | |||||
Notional amount of derivatives | 500 | $ 500 | |||
Period within which derivative will expire | 12 months | ||||
Interest rate swap agreements | Cash Flow Hedging | |||||
Financial Instruments and Risk Management | |||||
Net after-tax gain (loss) included in AOCI | $ 0 | ||||
Currency Exchange Rate Risk | |||||
Financial Instruments and Risk Management | |||||
Notional amount of derivatives | 1,400 | $ 1,400 | |||
Period within which derivative will expire | 2 years | ||||
Net after-tax gain (loss) included in AOCI | (2) | ||||
Currency Exchange Rate Risk | Maximum | |||||
Financial Instruments and Risk Management | |||||
Net gain expected to be recognized in the consolidated statement of earnings during the next 12 months | $ 1 | ||||
Cross-currency swap | |||||
Financial Instruments and Risk Management | |||||
Gain (loss) on derivatives included in accumulated other comprehensive earnings (loss), net of tax | 13 | 13 | |||
Net gain expected to be recognized in the consolidated statement of earnings during the next 12 months | 0 | ||||
Amount of hedge contract | $ 1,000 | ||||
Fair value of swaps | $ 27,000 | $ 27,000 | |||
Equity contracts | |||||
Financial Instruments and Risk Management | |||||
Change in company's stock price (in dollars per share) | $ / shares | $ 1 | ||||
Notional value of the swap (in shares) | item | 1.3 | 1.3 | |||
Fair value of swaps | $ (1) | $ (1) |
Financial Instruments and Ris68
Financial Instruments and Risk Management - Fair Value (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Fair Value Measurements | ||
Total current derivative contracts, assets | $ 87 | $ 40 |
Total noncurrent derivative contracts, assets | 43 | 46 |
Total current derivative contracts, liabilities | 21 | 25 |
Commodity contracts | ||
Fair Value Measurements | ||
Total current derivative contracts, assets | 66 | 18 |
Total noncurrent derivative contracts, assets | 15 | 7 |
Total current derivative contracts, liabilities | 15 | 3 |
Foreign currency contracts | ||
Fair Value Measurements | ||
Total current derivative contracts, assets | 21 | 1 |
Total noncurrent derivative contracts, assets | 1 | |
Total current derivative contracts, liabilities | 5 | 22 |
Interest rate and other contracts | ||
Fair Value Measurements | ||
Total current derivative contracts, assets | 21 | |
Total noncurrent derivative contracts, assets | 27 | 39 |
Total current derivative contracts, liabilities | 1 | |
Derivatives Designated As Hedging Instruments | ||
Fair Value Measurements | ||
Total current derivative contracts, assets | 63 | 18 |
Total noncurrent derivative contracts, assets | 43 | 46 |
Total current derivative contracts, liabilities | 14 | 3 |
Derivatives Designated As Hedging Instruments | Commodity contracts | ||
Fair Value Measurements | ||
Total current derivative contracts, assets | 63 | 17 |
Total noncurrent derivative contracts, assets | 15 | 7 |
Total current derivative contracts, liabilities | 14 | 3 |
Derivatives Designated As Hedging Instruments | Foreign currency contracts | ||
Fair Value Measurements | ||
Total current derivative contracts, assets | 1 | |
Total noncurrent derivative contracts, assets | 1 | |
Derivatives Designated As Hedging Instruments | Interest rate and other contracts | ||
Fair Value Measurements | ||
Total noncurrent derivative contracts, assets | 27 | 39 |
Derivatives Not Designated As Hedging Instruments | ||
Fair Value Measurements | ||
Total current derivative contracts, assets | 24 | 22 |
Total current derivative contracts, liabilities | 7 | 22 |
Derivatives Not Designated As Hedging Instruments | Commodity contracts | ||
Fair Value Measurements | ||
Total current derivative contracts, assets | 3 | 1 |
Total current derivative contracts, liabilities | 1 | |
Derivatives Not Designated As Hedging Instruments | Foreign currency contracts | ||
Fair Value Measurements | ||
Total current derivative contracts, assets | 21 | |
Total current derivative contracts, liabilities | 5 | 22 |
Derivatives Not Designated As Hedging Instruments | Interest rate and other contracts | ||
Fair Value Measurements | ||
Total current derivative contracts, assets | $ 21 | |
Total current derivative contracts, liabilities | $ 1 |
Financial Instruments and Ris69
Financial Instruments and Risk Management - Impact on Earnings (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Impact on Earnings from Derivative Instruments | ||
Cash Flow Hedge - Reclassified Amount from Other Comprehensive Earnings (Loss) | $ (9) | $ (5) |
Gain (Loss) on Derivatives not Designated as Hedge Instruments | (17) | (142) |
Amounts reclassified into earnings: | ||
Commodity contracts | (5) | 4 |
Cross currency swap contracts | 17 | |
Currency exchange contracts | (3) | 1 |
Change in fair value of cash flow hedges: | ||
Commodity contracts | 51 | (6) |
Interest rate contracts | (2) | |
Cross currency swap contracts | (12) | |
Currency exchange contracts | 3 | 3 |
Foreign Currency and tax impacts | 6 | |
Changes in accumulated other comprehensive earnings (loss) for effective derivatives | 57 | |
Commodity contracts | Net sales | ||
Impact on Earnings from Derivative Instruments | ||
Cash Flow Hedge - Reclassified Amount from Other Comprehensive Earnings (Loss) | (3) | 3 |
Commodity contracts | Cost of sales | ||
Impact on Earnings from Derivative Instruments | ||
Cash Flow Hedge - Reclassified Amount from Other Comprehensive Earnings (Loss) | 8 | (7) |
Interest rate contracts | Debt refinancing and other costs | ||
Impact on Earnings from Derivative Instruments | ||
Gain (Loss) on Derivatives not Designated as Hedge Instruments | (16) | |
Foreign currency contracts | Selling, general and administrative | ||
Impact on Earnings from Derivative Instruments | ||
Cash Flow Hedge - Reclassified Amount from Other Comprehensive Earnings (Loss) | (1) | |
Gain (Loss) on Derivatives not Designated as Hedge Instruments | (15) | |
Foreign currency contracts | Business consolidation and other activities | ||
Impact on Earnings from Derivative Instruments | ||
Cash Flow Hedge - Reclassified Amount from Other Comprehensive Earnings (Loss) | 3 | |
Gain (Loss) on Derivatives not Designated as Hedge Instruments | (88) | |
Equity contracts | Selling, general and administrative | ||
Impact on Earnings from Derivative Instruments | ||
Gain (Loss) on Derivatives not Designated as Hedge Instruments | (2) | (2) |
Cross-currency swap | Selling, general and administrative | ||
Impact on Earnings from Derivative Instruments | ||
Cash Flow Hedge - Reclassified Amount from Other Comprehensive Earnings (Loss) | $ (17) | |
Cross-currency swap | Business consolidation and other activities | ||
Impact on Earnings from Derivative Instruments | ||
Gain (Loss) on Derivatives not Designated as Hedge Instruments | $ (36) |
Contingencies - Environmental (
Contingencies - Environmental (Details) $ in Millions | Nov. 04, 2011 | Jan. 31, 2015USD ($) | Nov. 30, 2012item | Mar. 31, 2017USD ($)aaction | Sep. 30, 2014item | Dec. 31, 1992USD ($)company |
Other Current Liabilities And Other Noncurrent Liabilities | ||||||
Environmental remediation | ||||||
Estimated potential liability for all environmental matters | $ 45 | |||||
Waste Disposal Remediation | Lowry Landfill Site | ||||||
Environmental remediation | ||||||
Number of actions in which the company is actively involved | action | 0 | |||||
Waste Disposal Remediation | Lowry Landfill Site | Waste Management | ||||||
Environmental remediation | ||||||
Project costs to date | $ 140 | |||||
Period before projected completion of project when response cost is expected to exceed minimum amount | 3 years | |||||
Estimated additional cleanup costs | $ 10 | |||||
Estimated additional site costs for the potentially responsible party (PRP) group | 1 | |||||
Waste Disposal Remediation | Lowry Landfill Site | Waste Management | Minimum | ||||||
Environmental remediation | ||||||
Site contingency response cost | $ 319 | |||||
Waste Disposal Remediation | Lowry Landfill Site | Denver And Waste Management Litigation | ||||||
Environmental remediation | ||||||
Loss Contingency, Number of Defendants | company | 38 | |||||
Waste Disposal Remediation | Lower Duwamish Site | ||||||
Environmental remediation | ||||||
Project costs to date | $ 100 | |||||
Potential period for data review | 1 year | |||||
Number of additional potentially responsible parties (PRPs) | item | 20 | |||||
Total site remediation costs expected to cover river bottom area in excess of amount spent to date | $ 342 | |||||
Area of river bottom to be remediated (in acres) | a | 200 | |||||
Waste Disposal Remediation | Lower Duwamish Site | Minimum | ||||||
Environmental remediation | ||||||
Number of potentially responsible parties (PRPs) | item | 50 | |||||
Number of industrial companies and governmental entities under review | item | 30 | |||||
Number of PRP groups discussing allocation proposals | item | 2 | |||||
Waste Disposal Remediation | Crown Vantage Landfill Site | Georgia Pacific and International Paper Claims | ||||||
Environmental remediation | ||||||
Project costs to date | $ 14 | |||||
Amount of liability for site clean up by Rexam to successor (as a percentage) | 50.00% | |||||
Waste Disposal Remediation | Curtis Paper Superfund Site | Georgia Pacific And International Paper | ||||||
Environmental remediation | ||||||
Project costs to date | 30 | |||||
Rexam | Waste Disposal Remediation | Crown Vantage Landfill Site | Georgia Pacific and International Paper Claims | Georgia Pacific And International Paper | ||||||
Environmental remediation | ||||||
Amount of liability for site clean up costs by Rexam to successor | $ 7 |
Indemnifications and Guarante71
Indemnifications and Guarantees (Details) | 3 Months Ended |
Mar. 31, 2017 | |
Material Wholly Owned Domestic Subsidiaries | Senior credit facilities | |
Guarantees | |
Percent of capital stock pledged | 100.00% |
Material Wholly Owned First Tier Foreign Subsidiaries | Senior credit facilities | |
Guarantees | |
Percent of capital stock pledged | 65.00% |
Material Wholly Owned Foreign Subsidiaries And Material Wholly Owned U S Domiciled Foreign Subsidiaries | Obligation of certain foreign borrowers and foreign pledgors | |
Guarantees | |
Percent of capital stock pledged | 100.00% |
Subsidiary Guarantees of Debt -
Subsidiary Guarantees of Debt - Condensed Consolidating Statement of Earnings (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Subsidiary Guarantees of Debt | ||
Ownership interest in guarantor subsidiaries (as a percent) | 100.00% | |
Net sales | $ 2,473 | $ 1,756 |
Costs and expenses | ||
Cost of sales (excluding depreciation and amortization) | (1,975) | (1,416) |
Depreciation and amortization | (148) | (75) |
Selling, general and administrative | (143) | (108) |
Business consolidation and other activities | (55) | (267) |
Total costs and expenses | (2,321) | (1,866) |
Earnings (loss) before interest and taxes | 152 | (110) |
Interest expense | (68) | (38) |
Debt refinancing and other costs | (61) | |
Total interest expense | (68) | (99) |
Earnings (loss) before taxes | 84 | (209) |
Tax (provision) benefit | (22) | 83 |
Equity in results of affiliates, net of tax | 8 | (1) |
Net earnings (loss) | 70 | (127) |
Less net earnings attributable to noncontrolling interests | (2) | |
Net earnings (loss) attributable to Ball Corporation | 68 | (127) |
Comprehensive earnings (loss) attributable to Ball Corporation | 196 | (96) |
Eliminating Adjustments | ||
Subsidiary Guarantees of Debt | ||
Net sales | (15) | (25) |
Costs and expenses | ||
Cost of sales (excluding depreciation and amortization) | 15 | 25 |
Equity in results of subsidiaries | (127) | (120) |
Total costs and expenses | (112) | (95) |
Earnings (loss) before interest and taxes | (127) | (120) |
Earnings (loss) before taxes | (127) | (120) |
Net earnings (loss) | (127) | (120) |
Net earnings (loss) attributable to Ball Corporation | (127) | (120) |
Comprehensive earnings (loss) attributable to Ball Corporation | (305) | (166) |
Guarantees Relating to Senior Notes | ||
Subsidiary Guarantees of Debt | ||
Net sales | 2,473 | 1,756 |
Costs and expenses | ||
Cost of sales (excluding depreciation and amortization) | (1,975) | (1,416) |
Depreciation and amortization | (148) | (75) |
Selling, general and administrative | (143) | (108) |
Business consolidation and other activities | (55) | (267) |
Total costs and expenses | (2,321) | (1,866) |
Earnings (loss) before interest and taxes | 152 | (110) |
Interest expense | (68) | (38) |
Debt refinancing and other costs | (61) | |
Total interest expense | (68) | (99) |
Earnings (loss) before taxes | 84 | (209) |
Tax (provision) benefit | (22) | 83 |
Equity in results of affiliates, net of tax | 8 | (1) |
Net earnings (loss) | 70 | (127) |
Less net earnings attributable to noncontrolling interests | (2) | |
Net earnings (loss) attributable to Ball Corporation | 68 | (127) |
Comprehensive earnings (loss) attributable to Ball Corporation | 196 | (96) |
Guarantees Relating to Senior Notes | Eliminating Adjustments | ||
Subsidiary Guarantees of Debt | ||
Net sales | (15) | (25) |
Costs and expenses | ||
Cost of sales (excluding depreciation and amortization) | 15 | 25 |
Equity in results of subsidiaries | (119) | (120) |
Total costs and expenses | (104) | (95) |
Earnings (loss) before interest and taxes | (119) | (120) |
Earnings (loss) before taxes | (119) | (120) |
Net earnings (loss) | (119) | (120) |
Net earnings (loss) attributable to Ball Corporation | (119) | (120) |
Comprehensive earnings (loss) attributable to Ball Corporation | (312) | (166) |
Ball Corporation | ||
Costs and expenses | ||
Depreciation and amortization | (2) | (1) |
Selling, general and administrative | (45) | (20) |
Business consolidation and other activities | (51) | (260) |
Equity in results of subsidiaries | 123 | 84 |
Intercompany | 81 | 52 |
Total costs and expenses | 106 | (145) |
Earnings (loss) before interest and taxes | 106 | (145) |
Interest expense | (65) | (38) |
Debt refinancing and other costs | (59) | |
Total interest expense | (65) | (97) |
Earnings (loss) before taxes | 41 | (242) |
Tax (provision) benefit | 27 | 115 |
Net earnings (loss) | 68 | (127) |
Net earnings (loss) attributable to Ball Corporation | 68 | (127) |
Comprehensive earnings (loss) attributable to Ball Corporation | 196 | (96) |
Ball Corporation | Guarantees Relating to Senior Notes | ||
Costs and expenses | ||
Depreciation and amortization | (2) | (1) |
Selling, general and administrative | (45) | (20) |
Business consolidation and other activities | (51) | (260) |
Equity in results of subsidiaries | 123 | 84 |
Intercompany | 81 | 52 |
Total costs and expenses | 106 | (145) |
Earnings (loss) before interest and taxes | 106 | (145) |
Interest expense | (65) | (38) |
Debt refinancing and other costs | (59) | |
Total interest expense | (65) | (97) |
Earnings (loss) before taxes | 41 | (242) |
Tax (provision) benefit | 27 | 115 |
Net earnings (loss) | 68 | (127) |
Net earnings (loss) attributable to Ball Corporation | 68 | (127) |
Comprehensive earnings (loss) attributable to Ball Corporation | 196 | (96) |
Guarantor Subsidiaries | ||
Subsidiary Guarantees of Debt | ||
Net sales | 1,115 | 1,075 |
Costs and expenses | ||
Cost of sales (excluding depreciation and amortization) | (903) | (886) |
Depreciation and amortization | (36) | (36) |
Selling, general and administrative | (41) | (40) |
Business consolidation and other activities | 6 | (17) |
Equity in results of subsidiaries | 4 | 36 |
Intercompany | (43) | (41) |
Total costs and expenses | (1,013) | (984) |
Earnings (loss) before interest and taxes | 102 | 91 |
Interest expense | 1 | |
Total interest expense | 1 | |
Earnings (loss) before taxes | 103 | 91 |
Tax (provision) benefit | (37) | (19) |
Equity in results of affiliates, net of tax | (1) | |
Net earnings (loss) | 66 | 71 |
Net earnings (loss) attributable to Ball Corporation | 66 | 71 |
Comprehensive earnings (loss) attributable to Ball Corporation | 159 | 100 |
Guarantor Subsidiaries | Guarantees Relating to Senior Notes | ||
Subsidiary Guarantees of Debt | ||
Net sales | 1,115 | 1,075 |
Costs and expenses | ||
Cost of sales (excluding depreciation and amortization) | (903) | (886) |
Depreciation and amortization | (36) | (36) |
Selling, general and administrative | (41) | (40) |
Business consolidation and other activities | 5 | (4) |
Equity in results of subsidiaries | 3 | 36 |
Intercompany | (41) | (41) |
Total costs and expenses | (1,013) | (971) |
Earnings (loss) before interest and taxes | 102 | 104 |
Interest expense | 1 | |
Total interest expense | 1 | |
Earnings (loss) before taxes | 103 | 104 |
Tax (provision) benefit | (37) | (19) |
Equity in results of affiliates, net of tax | (1) | |
Net earnings (loss) | 66 | 84 |
Net earnings (loss) attributable to Ball Corporation | 66 | 84 |
Comprehensive earnings (loss) attributable to Ball Corporation | 168 | 113 |
Non-Guarantor Subsidiaries | ||
Subsidiary Guarantees of Debt | ||
Net sales | 1,373 | 706 |
Costs and expenses | ||
Cost of sales (excluding depreciation and amortization) | (1,087) | (555) |
Depreciation and amortization | (110) | (38) |
Selling, general and administrative | (57) | (48) |
Business consolidation and other activities | (10) | 10 |
Intercompany | (38) | (11) |
Total costs and expenses | (1,302) | (642) |
Earnings (loss) before interest and taxes | 71 | 64 |
Interest expense | (4) | |
Debt refinancing and other costs | (2) | |
Total interest expense | (4) | (2) |
Earnings (loss) before taxes | 67 | 62 |
Tax (provision) benefit | (12) | (13) |
Equity in results of affiliates, net of tax | 8 | |
Net earnings (loss) | 63 | 49 |
Less net earnings attributable to noncontrolling interests | (2) | |
Net earnings (loss) attributable to Ball Corporation | 61 | 49 |
Comprehensive earnings (loss) attributable to Ball Corporation | 146 | 66 |
Non-Guarantor Subsidiaries | Guarantees Relating to Senior Notes | ||
Subsidiary Guarantees of Debt | ||
Net sales | 1,373 | 706 |
Costs and expenses | ||
Cost of sales (excluding depreciation and amortization) | (1,087) | (555) |
Depreciation and amortization | (110) | (38) |
Selling, general and administrative | (57) | (48) |
Business consolidation and other activities | (9) | (3) |
Equity in results of subsidiaries | (7) | |
Intercompany | (40) | (11) |
Total costs and expenses | (1,310) | (655) |
Earnings (loss) before interest and taxes | 63 | 51 |
Interest expense | (4) | |
Debt refinancing and other costs | (2) | |
Total interest expense | (4) | (2) |
Earnings (loss) before taxes | 59 | 49 |
Tax (provision) benefit | (12) | (13) |
Equity in results of affiliates, net of tax | 8 | |
Net earnings (loss) | 55 | 36 |
Less net earnings attributable to noncontrolling interests | (2) | |
Net earnings (loss) attributable to Ball Corporation | 53 | 36 |
Comprehensive earnings (loss) attributable to Ball Corporation | $ 144 | $ 53 |
Subsidiary Guarantees of Debt73
Subsidiary Guarantees of Debt - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets | ||||
Cash and cash equivalents | $ 458 | $ 597 | $ 205 | $ 224 |
Receivables, net | 1,695 | 1,491 | ||
Inventories, net | 1,554 | 1,413 | ||
Other Assets, Current | 200 | 152 | ||
Total current assets | 3,907 | 3,653 | ||
Noncurrent assets | ||||
Property, plant and equipment, net | 4,403 | 4,387 | ||
Goodwill | 5,152 | 5,095 | ||
Intangible assets, net | 1,917 | 1,934 | ||
Other assets | 1,265 | 1,104 | ||
Total assets | 16,644 | 16,173 | ||
Current liabilities | ||||
Short-term debt and current portion of long-term debt | 497 | 222 | ||
Accounts payable | 1,830 | 2,033 | ||
Accrued employee costs | 264 | 315 | ||
Other current liabilities | 427 | 399 | ||
Total current liabilities | 3,018 | 2,969 | ||
Noncurrent liabilities | ||||
Long-term debt | 7,476 | 7,310 | ||
Employee benefit obligations | 1,487 | 1,497 | ||
Deferred taxes | 855 | 759 | ||
Other liabilities | 85 | 97 | ||
Total liabilities | 12,921 | 12,632 | ||
Common stock | 1,040 | 1,038 | ||
Retained earnings | 4,784 | 4,739 | ||
Accumulated other comprehensive earnings (loss) | (813) | (941) | ||
Treasury stock, at cost | (1,392) | (1,401) | ||
Total Ball Corporation shareholders' equity | 3,619 | 3,435 | ||
Noncontrolling interests | 104 | 106 | ||
Total shareholders' equity | 3,723 | 3,541 | ||
Total liabilities and shareholders' equity | 16,644 | 16,173 | ||
Eliminating Adjustments | ||||
Current assets | ||||
Intercompany receivables | (1,099) | (1,127) | ||
Total current assets | (1,099) | (1,127) | ||
Noncurrent assets | ||||
Investment in subsidiaries | (10,490) | (10,183) | ||
Total assets | (11,589) | (11,310) | ||
Current liabilities | ||||
Intercompany payables | (1,111) | (1,127) | ||
Total current liabilities | (1,111) | (1,127) | ||
Noncurrent liabilities | ||||
Intercompany long-term notes | 12 | |||
Total liabilities | (1,099) | (1,127) | ||
Common stock | (5,061) | (5,061) | ||
Preferred stock | (5) | (5) | ||
Retained earnings | (6,610) | (6,482) | ||
Accumulated other comprehensive earnings (loss) | 1,186 | 1,365 | ||
Total Ball Corporation shareholders' equity | (10,490) | (10,183) | ||
Total shareholders' equity | (10,490) | (10,183) | ||
Total liabilities and shareholders' equity | (11,589) | (11,310) | ||
Ball Corporation | ||||
Current assets | ||||
Cash and cash equivalents | 5 | 2 | 3 | 5 |
Receivables, net | 77 | 96 | ||
Intercompany receivables | 41 | 39 | ||
Other Assets, Current | 33 | 40 | ||
Total current assets | 156 | 177 | ||
Noncurrent assets | ||||
Property, plant and equipment, net | 23 | 23 | ||
Investment in subsidiaries | 8,039 | 7,815 | ||
Goodwill | 3 | |||
Intangible assets, net | 18 | 18 | ||
Other assets | 80 | 94 | ||
Total assets | 8,319 | 8,127 | ||
Current liabilities | ||||
Short-term debt and current portion of long-term debt | 258 | 141 | ||
Accounts payable | 15 | 18 | ||
Intercompany payables | 1,012 | 1,010 | ||
Accrued employee costs | 25 | 25 | ||
Other current liabilities | 156 | 138 | ||
Total current liabilities | 1,466 | 1,332 | ||
Noncurrent liabilities | ||||
Long-term debt | 6,493 | 6,337 | ||
Employee benefit obligations | 331 | 347 | ||
Intercompany long-term notes | (3,370) | (3,142) | ||
Deferred taxes | (227) | (193) | ||
Other liabilities | 7 | 12 | ||
Total liabilities | 4,700 | 4,693 | ||
Common stock | 1,040 | 1,038 | ||
Retained earnings | 4,784 | 4,739 | ||
Accumulated other comprehensive earnings (loss) | (813) | (942) | ||
Treasury stock, at cost | (1,392) | (1,401) | ||
Total Ball Corporation shareholders' equity | 3,619 | 3,434 | ||
Total shareholders' equity | 3,619 | 3,434 | ||
Total liabilities and shareholders' equity | 8,319 | 8,127 | ||
Guarantor Subsidiaries | ||||
Current assets | ||||
Cash and cash equivalents | (11) | 23 | ||
Receivables, net | 551 | 450 | ||
Intercompany receivables | 117 | 125 | ||
Inventories, net | 565 | 516 | ||
Other Assets, Current | 48 | 33 | ||
Total current assets | 1,281 | 1,113 | ||
Noncurrent assets | ||||
Property, plant and equipment, net | 1,116 | 1,087 | ||
Investment in subsidiaries | 2,372 | 2,289 | ||
Goodwill | 981 | 990 | ||
Intangible assets, net | 76 | 76 | ||
Other assets | 23 | 20 | ||
Total assets | 5,849 | 5,575 | ||
Current liabilities | ||||
Accounts payable | 679 | 771 | ||
Intercompany payables | 39 | 52 | ||
Accrued employee costs | 92 | 135 | ||
Other current liabilities | 72 | 65 | ||
Total current liabilities | 882 | 1,023 | ||
Noncurrent liabilities | ||||
Employee benefit obligations | 445 | 440 | ||
Intercompany long-term notes | 421 | 178 | ||
Deferred taxes | 226 | 218 | ||
Other liabilities | (1) | |||
Total liabilities | 1,973 | 1,859 | ||
Common stock | 635 | 635 | ||
Retained earnings | 3,960 | 3,893 | ||
Accumulated other comprehensive earnings (loss) | (719) | (812) | ||
Total Ball Corporation shareholders' equity | 3,876 | 3,716 | ||
Total shareholders' equity | 3,876 | 3,716 | ||
Total liabilities and shareholders' equity | 5,849 | 5,575 | ||
Non-Guarantor Subsidiaries | ||||
Current assets | ||||
Cash and cash equivalents | 453 | 606 | 179 | 219 |
Receivables, net | 1,067 | 945 | ||
Intercompany receivables | 941 | 963 | ||
Inventories, net | 989 | 897 | ||
Other Assets, Current | 119 | 79 | ||
Total current assets | 3,569 | 3,490 | ||
Noncurrent assets | ||||
Property, plant and equipment, net | 3,264 | 3,277 | ||
Investment in subsidiaries | 79 | 79 | ||
Goodwill | 4,168 | 4,105 | ||
Intangible assets, net | 1,823 | 1,840 | ||
Other assets | 1,162 | 990 | ||
Total assets | 14,065 | 13,781 | ||
Current liabilities | ||||
Short-term debt and current portion of long-term debt | 239 | 81 | ||
Accounts payable | 1,136 | 1,244 | ||
Intercompany payables | 60 | 65 | ||
Accrued employee costs | 147 | 155 | ||
Other current liabilities | 199 | 196 | ||
Total current liabilities | 1,781 | 1,741 | ||
Noncurrent liabilities | ||||
Long-term debt | 983 | 973 | ||
Employee benefit obligations | 711 | 710 | ||
Intercompany long-term notes | 2,937 | 2,964 | ||
Deferred taxes | 856 | 734 | ||
Other liabilities | 79 | 85 | ||
Total liabilities | 7,347 | 7,207 | ||
Common stock | 4,426 | 4,426 | ||
Preferred stock | 5 | 5 | ||
Retained earnings | 2,650 | 2,589 | ||
Accumulated other comprehensive earnings (loss) | (467) | (552) | ||
Total Ball Corporation shareholders' equity | 6,614 | 6,468 | ||
Noncontrolling interests | 104 | 106 | ||
Total shareholders' equity | 6,718 | 6,574 | ||
Total liabilities and shareholders' equity | 14,065 | 13,781 | ||
Guarantees Relating to Senior Notes | ||||
Current assets | ||||
Cash and cash equivalents | 458 | 597 | 205 | 224 |
Receivables, net | 1,695 | 1,491 | ||
Inventories, net | 1,554 | 1,413 | ||
Other Assets, Current | 200 | 152 | ||
Total current assets | 3,907 | 3,653 | ||
Noncurrent assets | ||||
Property, plant and equipment, net | 4,403 | 4,387 | ||
Goodwill | 5,152 | 5,095 | ||
Intangible assets, net | 1,917 | 1,934 | ||
Other assets | 1,265 | 1,104 | ||
Total assets | 16,644 | 16,173 | ||
Current liabilities | ||||
Short-term debt and current portion of long-term debt | 497 | 222 | ||
Accounts payable | 1,830 | 2,033 | ||
Accrued employee costs | 264 | 315 | ||
Other current liabilities | 427 | 399 | ||
Total current liabilities | 3,018 | 2,969 | ||
Noncurrent liabilities | ||||
Long-term debt | 7,476 | 7,310 | ||
Employee benefit obligations | 1,487 | 1,497 | ||
Deferred taxes | 855 | 759 | ||
Other liabilities | 85 | 97 | ||
Total liabilities | 12,921 | 12,632 | ||
Common stock | 1,040 | 1,038 | ||
Retained earnings | 4,784 | 4,739 | ||
Accumulated other comprehensive earnings (loss) | (813) | (941) | ||
Treasury stock, at cost | (1,392) | (1,401) | ||
Total Ball Corporation shareholders' equity | 3,619 | 3,435 | ||
Noncontrolling interests | 104 | 106 | ||
Total shareholders' equity | 3,723 | 3,541 | ||
Total liabilities and shareholders' equity | 16,644 | 16,173 | ||
Guarantees Relating to Senior Notes | Eliminating Adjustments | ||||
Current assets | ||||
Intercompany receivables | (1,447) | (1,469) | ||
Total current assets | (1,447) | (1,469) | ||
Noncurrent assets | ||||
Investment in subsidiaries | (12,843) | (12,529) | ||
Total assets | (14,290) | (13,998) | ||
Current liabilities | ||||
Intercompany payables | (1,460) | (1,471) | ||
Total current liabilities | (1,460) | (1,471) | ||
Noncurrent liabilities | ||||
Intercompany long-term notes | 13 | 2 | ||
Total liabilities | (1,447) | (1,469) | ||
Common stock | (7,421) | (7,421) | ||
Preferred stock | (5) | (5) | ||
Retained earnings | (6,613) | (6,493) | ||
Accumulated other comprehensive earnings (loss) | 1,196 | 1,390 | ||
Total Ball Corporation shareholders' equity | (12,843) | (12,529) | ||
Total shareholders' equity | (12,843) | (12,529) | ||
Total liabilities and shareholders' equity | (14,290) | (13,998) | ||
Guarantees Relating to Senior Notes | Ball Corporation | ||||
Current assets | ||||
Cash and cash equivalents | 5 | 2 | 3 | 5 |
Receivables, net | 77 | 96 | ||
Intercompany receivables | 41 | 39 | ||
Other Assets, Current | 33 | 40 | ||
Total current assets | 156 | 177 | ||
Noncurrent assets | ||||
Property, plant and equipment, net | 23 | 23 | ||
Investment in subsidiaries | 8,039 | 7,815 | ||
Goodwill | 3 | |||
Intangible assets, net | 18 | 18 | ||
Other assets | 80 | 94 | ||
Total assets | 8,319 | 8,127 | ||
Current liabilities | ||||
Short-term debt and current portion of long-term debt | 258 | 141 | ||
Accounts payable | 15 | 18 | ||
Intercompany payables | 1,012 | 1,010 | ||
Accrued employee costs | 25 | 25 | ||
Other current liabilities | 156 | 138 | ||
Total current liabilities | 1,466 | 1,332 | ||
Noncurrent liabilities | ||||
Long-term debt | 6,493 | 6,337 | ||
Employee benefit obligations | 331 | 347 | ||
Intercompany long-term notes | (3,370) | (3,142) | ||
Deferred taxes | (227) | (193) | ||
Other liabilities | 7 | 12 | ||
Total liabilities | 4,700 | 4,693 | ||
Common stock | 1,040 | 1,038 | ||
Retained earnings | 4,784 | 4,739 | ||
Accumulated other comprehensive earnings (loss) | (813) | (942) | ||
Treasury stock, at cost | (1,392) | (1,401) | ||
Total Ball Corporation shareholders' equity | 3,619 | 3,434 | ||
Total shareholders' equity | 3,619 | 3,434 | ||
Total liabilities and shareholders' equity | 8,319 | 8,127 | ||
Guarantees Relating to Senior Notes | Guarantor Subsidiaries | ||||
Current assets | ||||
Cash and cash equivalents | (11) | 5 | ||
Receivables, net | 551 | 450 | ||
Intercompany receivables | 465 | 467 | ||
Inventories, net | 565 | 516 | ||
Other Assets, Current | 54 | 39 | ||
Total current assets | 1,635 | 1,461 | ||
Noncurrent assets | ||||
Property, plant and equipment, net | 1,116 | 1,087 | ||
Investment in subsidiaries | 4,380 | 4,291 | ||
Goodwill | 977 | 985 | ||
Intangible assets, net | 76 | 76 | ||
Other assets | 297 | 306 | ||
Total assets | 8,481 | 8,206 | ||
Current liabilities | ||||
Accounts payable | 680 | 772 | ||
Intercompany payables | 40 | 53 | ||
Accrued employee costs | 103 | 152 | ||
Other current liabilities | 76 | 69 | ||
Total current liabilities | 899 | 1,046 | ||
Noncurrent liabilities | ||||
Employee benefit obligations | 754 | 760 | ||
Intercompany long-term notes | 2,278 | 2,018 | ||
Deferred taxes | 268 | 261 | ||
Other liabilities | (1) | 6 | ||
Total liabilities | 4,198 | 4,091 | ||
Common stock | 1,120 | 1,120 | ||
Retained earnings | 3,898 | 3,832 | ||
Accumulated other comprehensive earnings (loss) | (735) | (837) | ||
Total Ball Corporation shareholders' equity | 4,283 | 4,115 | ||
Total shareholders' equity | 4,283 | 4,115 | ||
Total liabilities and shareholders' equity | 8,481 | 8,206 | ||
Guarantees Relating to Senior Notes | Non-Guarantor Subsidiaries | ||||
Current assets | ||||
Cash and cash equivalents | 453 | 606 | $ 197 | $ 219 |
Receivables, net | 1,067 | 945 | ||
Intercompany receivables | 941 | 963 | ||
Inventories, net | 989 | 897 | ||
Other Assets, Current | 113 | 73 | ||
Total current assets | 3,563 | 3,484 | ||
Noncurrent assets | ||||
Property, plant and equipment, net | 3,264 | 3,277 | ||
Investment in subsidiaries | 424 | 423 | ||
Goodwill | 4,172 | 4,110 | ||
Intangible assets, net | 1,823 | 1,840 | ||
Other assets | 888 | 704 | ||
Total assets | 14,134 | 13,838 | ||
Current liabilities | ||||
Short-term debt and current portion of long-term debt | 239 | 81 | ||
Accounts payable | 1,135 | 1,243 | ||
Intercompany payables | 408 | 408 | ||
Accrued employee costs | 136 | 138 | ||
Other current liabilities | 195 | 192 | ||
Total current liabilities | 2,113 | 2,062 | ||
Noncurrent liabilities | ||||
Long-term debt | 983 | 973 | ||
Employee benefit obligations | 402 | 390 | ||
Intercompany long-term notes | 1,079 | 1,122 | ||
Deferred taxes | 814 | 691 | ||
Other liabilities | 79 | 79 | ||
Total liabilities | 5,470 | 5,317 | ||
Common stock | 6,301 | 6,301 | ||
Preferred stock | 5 | 5 | ||
Retained earnings | 2,715 | 2,661 | ||
Accumulated other comprehensive earnings (loss) | (461) | (552) | ||
Total Ball Corporation shareholders' equity | 8,560 | 8,415 | ||
Noncontrolling interests | 104 | 106 | ||
Total shareholders' equity | 8,664 | 8,521 | ||
Total liabilities and shareholders' equity | $ 14,134 | $ 13,838 |
Subsidiary Guarantees of Debt74
Subsidiary Guarantees of Debt - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Subsidiary Guarantees of Debt | ||
Net Cash Provided by (Used in) Operating Activities, Continuing Operations | $ (398) | $ (386) |
Cash flows from investing activities | ||
Capital expenditures | (125) | (138) |
Business acquisition, net of cash acquired | (36) | |
Business dispositions, net of cash sold | 31 | |
Other, net | 3 | (11) |
Cash provided by (used in) investing activities | (91) | (185) |
Cash flows from financing activities | ||
Long-term borrowings | 185 | 801 |
Repayments of long-term borrowings | (50) | (407) |
Net change in short-term borrowings | 273 | 310 |
Proceeds from issuances of common stock, net of shares used for taxes | (1) | 7 |
Acquisitions of treasury stock | (3) | (98) |
Common dividends | (23) | (19) |
Other, net | (1) | (22) |
Cash provided by (used in) financing activities | 380 | 572 |
Effect of exchange rate changes on cash | (30) | (20) |
Change in cash and cash equivalents | (139) | (19) |
Cash and cash equivalents - beginning of period | 597 | 224 |
Cash and cash equivalents - end of period | 458 | 205 |
Ball Corporation | ||
Subsidiary Guarantees of Debt | ||
Net Cash Provided by (Used in) Operating Activities, Continuing Operations | 7 | (36) |
Cash flows from investing activities | ||
Capital expenditures | (4) | (7) |
Other, net | 2 | (13) |
Cash provided by (used in) investing activities | (2) | (20) |
Cash flows from financing activities | ||
Long-term borrowings | 185 | 795 |
Repayments of long-term borrowings | (48) | (390) |
Net change in short-term borrowings | 116 | 98 |
Proceeds from issuances of common stock, net of shares used for taxes | (1) | 7 |
Acquisitions of treasury stock | (3) | (98) |
Common dividends | (23) | (19) |
Intercompany | (229) | (331) |
Other, net | (13) | |
Cash provided by (used in) financing activities | (3) | 49 |
Effect of exchange rate changes on cash | 1 | 5 |
Change in cash and cash equivalents | 3 | (2) |
Cash and cash equivalents - beginning of period | 2 | 5 |
Cash and cash equivalents - end of period | 5 | 3 |
Guarantor Subsidiaries | ||
Subsidiary Guarantees of Debt | ||
Net Cash Provided by (Used in) Operating Activities, Continuing Operations | (182) | (130) |
Cash flows from investing activities | ||
Capital expenditures | (82) | (44) |
Business acquisition, net of cash acquired | (36) | |
Business dispositions, net of cash sold | 31 | |
Other, net | 8 | 2 |
Cash provided by (used in) investing activities | (43) | (78) |
Cash flows from financing activities | ||
Intercompany | 237 | 214 |
Other, net | (1) | |
Cash provided by (used in) financing activities | 236 | 214 |
Effect of exchange rate changes on cash | 17 | |
Change in cash and cash equivalents | 11 | 23 |
Cash and cash equivalents - beginning of period | (11) | |
Cash and cash equivalents - end of period | 23 | |
Non-Guarantor Subsidiaries | ||
Subsidiary Guarantees of Debt | ||
Net Cash Provided by (Used in) Operating Activities, Continuing Operations | (223) | (220) |
Cash flows from investing activities | ||
Capital expenditures | (39) | (87) |
Other, net | (7) | |
Cash provided by (used in) investing activities | (46) | (87) |
Cash flows from financing activities | ||
Long-term borrowings | 6 | |
Repayments of long-term borrowings | (2) | (17) |
Net change in short-term borrowings | 157 | 212 |
Intercompany | (8) | 117 |
Other, net | (9) | |
Cash provided by (used in) financing activities | 147 | 309 |
Effect of exchange rate changes on cash | (31) | (42) |
Change in cash and cash equivalents | (153) | (40) |
Cash and cash equivalents - beginning of period | 606 | 219 |
Cash and cash equivalents - end of period | 453 | 179 |
Guarantees Relating to Senior Notes | ||
Subsidiary Guarantees of Debt | ||
Net Cash Provided by (Used in) Operating Activities, Continuing Operations | (398) | (386) |
Cash flows from investing activities | ||
Capital expenditures | (125) | (138) |
Business acquisition, net of cash acquired | (36) | |
Business dispositions, net of cash sold | 31 | |
Other, net | 3 | (11) |
Cash provided by (used in) investing activities | (91) | (185) |
Cash flows from financing activities | ||
Long-term borrowings | 185 | 801 |
Repayments of long-term borrowings | (50) | (407) |
Net change in short-term borrowings | 273 | 310 |
Proceeds from issuances of common stock, net of shares used for taxes | (1) | 7 |
Acquisitions of treasury stock | (3) | (98) |
Common dividends | (23) | (19) |
Other, net | (1) | (22) |
Cash provided by (used in) financing activities | 380 | 572 |
Effect of exchange rate changes on cash | (30) | (20) |
Change in cash and cash equivalents | (139) | (19) |
Cash and cash equivalents - beginning of period | 597 | 224 |
Cash and cash equivalents - end of period | 458 | 205 |
Guarantees Relating to Senior Notes | Ball Corporation | ||
Subsidiary Guarantees of Debt | ||
Net Cash Provided by (Used in) Operating Activities, Continuing Operations | 7 | (36) |
Cash flows from investing activities | ||
Capital expenditures | (4) | (7) |
Other, net | 2 | (13) |
Cash provided by (used in) investing activities | (2) | (20) |
Cash flows from financing activities | ||
Long-term borrowings | 185 | 795 |
Repayments of long-term borrowings | (48) | (390) |
Net change in short-term borrowings | 116 | 98 |
Proceeds from issuances of common stock, net of shares used for taxes | (1) | 7 |
Acquisitions of treasury stock | (3) | (98) |
Common dividends | (23) | (19) |
Intercompany | (229) | (331) |
Other, net | (13) | |
Cash provided by (used in) financing activities | (3) | 49 |
Effect of exchange rate changes on cash | 1 | 5 |
Change in cash and cash equivalents | 3 | (2) |
Cash and cash equivalents - beginning of period | 2 | 5 |
Cash and cash equivalents - end of period | 5 | 3 |
Guarantees Relating to Senior Notes | Guarantor Subsidiaries | ||
Subsidiary Guarantees of Debt | ||
Net Cash Provided by (Used in) Operating Activities, Continuing Operations | (194) | (130) |
Cash flows from investing activities | ||
Capital expenditures | (82) | (44) |
Business acquisition, net of cash acquired | (36) | |
Business dispositions, net of cash sold | 31 | |
Other, net | 8 | 2 |
Cash provided by (used in) investing activities | (43) | (78) |
Cash flows from financing activities | ||
Intercompany | 249 | 196 |
Other, net | (1) | |
Cash provided by (used in) financing activities | 248 | 196 |
Effect of exchange rate changes on cash | 17 | |
Change in cash and cash equivalents | 11 | 5 |
Cash and cash equivalents - beginning of period | (11) | |
Cash and cash equivalents - end of period | 5 | |
Guarantees Relating to Senior Notes | Non-Guarantor Subsidiaries | ||
Subsidiary Guarantees of Debt | ||
Net Cash Provided by (Used in) Operating Activities, Continuing Operations | (211) | (220) |
Cash flows from investing activities | ||
Capital expenditures | (39) | (87) |
Other, net | (7) | |
Cash provided by (used in) investing activities | (46) | (87) |
Cash flows from financing activities | ||
Long-term borrowings | 6 | |
Repayments of long-term borrowings | (2) | (17) |
Net change in short-term borrowings | 157 | 212 |
Intercompany | (20) | 135 |
Other, net | (9) | |
Cash provided by (used in) financing activities | 135 | 327 |
Effect of exchange rate changes on cash | (31) | (42) |
Change in cash and cash equivalents | (153) | (22) |
Cash and cash equivalents - beginning of period | 606 | 219 |
Cash and cash equivalents - end of period | $ 453 | $ 197 |