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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Goodyear Tire and Rubber Company | NASDAQ:GT | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.05 | -0.42% | 11.91 | 11.87 | 11.99 | 519 | 13:19:00 |
|
Ohio
(State or Other Jurisdiction of
Incorporation or Organization)
|
|
34-0253240
(I.R.S. Employer
Identification No.)
|
|
|
|
200 Innovation Way, Akron, Ohio
(Address of Principal Executive Offices)
|
|
44316-0001
(Zip Code)
|
Large accelerated filer
þ
|
|
Accelerated filer
o
|
|
Non-accelerated filer
o
|
|
Smaller reporting company
o
|
|
Emerging growth company
o
|
|
|
|
|
(Do not check if a smaller reporting company)
|
|
|
|
|
Number of Shares of Common Stock,
Without Par Value, Outstanding at March 31, 2018: |
|
239,828,882
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
||
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||
|
||
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||
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||
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|
||
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||
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||
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Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions, except per share amounts)
|
2018
|
|
2017
|
||||
Net Sales (Note 2)
|
$
|
3,830
|
|
|
$
|
3,699
|
|
Cost of Goods Sold
|
2,976
|
|
|
2,760
|
|
||
Selling, Administrative and General Expense
|
591
|
|
|
576
|
|
||
Rationalizations (Note 3)
|
37
|
|
|
29
|
|
||
Interest Expense
|
76
|
|
|
87
|
|
||
Other (Income) Expense (Note 4)
|
37
|
|
|
8
|
|
||
Income before Income Taxes
|
113
|
|
|
239
|
|
||
United States and Foreign Tax Expense (Note 5)
|
33
|
|
|
70
|
|
||
Net Income
|
80
|
|
|
169
|
|
||
Less: Minority Shareholders’ Net Income
|
5
|
|
|
3
|
|
||
Goodyear Net Income
|
$
|
75
|
|
|
$
|
166
|
|
Goodyear Net Income — Per Share of Common Stock
|
|
|
|
||||
Basic
|
$
|
0.31
|
|
|
$
|
0.66
|
|
Weighted Average Shares Outstanding (Note 6)
|
240
|
|
|
252
|
|
||
Diluted
|
$
|
0.31
|
|
|
$
|
0.65
|
|
Weighted Average Shares Outstanding (Note 6)
|
244
|
|
|
256
|
|
||
|
|
|
|
||||
Cash Dividends Declared Per Common Share (Note 13)
|
$
|
0.14
|
|
|
$
|
0.10
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions)
|
2018
|
|
2017
|
||||
Net Income
|
$
|
80
|
|
|
$
|
169
|
|
Other Comprehensive Income (Loss):
|
|
|
|
||||
Foreign currency translation, net of tax of ($2) in 2018 ($3 in 2017)
|
82
|
|
|
84
|
|
||
Defined benefit plans:
|
|
|
|
||||
Amortization of prior service cost and unrecognized gains and (losses) included in total benefit cost, net of tax of $8 in 2018 ($10 in 2017)
|
27
|
|
|
20
|
|
||
Decrease in net actuarial losses, net of tax of $1 in 2018 ($1 in 2017)
|
3
|
|
|
4
|
|
||
Deferred derivative losses, net of tax of ($2) in 2018 (($2) in 2017)
|
(4
|
)
|
|
(6
|
)
|
||
Reclassification adjustment for amounts recognized in income, net of tax of $1 in 2018 (($1) in 2017)
|
3
|
|
|
(1
|
)
|
||
Other Comprehensive Income
|
111
|
|
|
101
|
|
||
Comprehensive Income
|
191
|
|
|
270
|
|
||
Less: Comprehensive Income Attributable to Minority Shareholders
|
7
|
|
|
9
|
|
||
Goodyear Comprehensive Income
|
$
|
184
|
|
|
$
|
261
|
|
|
March 31,
|
|
December 31,
|
||||
(In millions)
|
2018
|
|
2017
|
||||
Assets:
|
|
|
|
||||
Current Assets:
|
|
|
|
||||
Cash and Cash Equivalents
|
$
|
837
|
|
|
$
|
1,043
|
|
Accounts Receivable, less Allowance — $119 ($116 in 2017)
|
2,509
|
|
|
2,025
|
|
||
Inventories:
|
|
|
|
||||
Raw Materials
|
501
|
|
|
466
|
|
||
Work in Process
|
158
|
|
|
142
|
|
||
Finished Products
|
2,236
|
|
|
2,179
|
|
||
|
2,895
|
|
|
2,787
|
|
||
Prepaid Expenses and Other Current Assets
|
247
|
|
|
224
|
|
||
Total Current Assets
|
6,488
|
|
|
6,079
|
|
||
Goodwill
|
606
|
|
|
595
|
|
||
Intangible Assets
|
140
|
|
|
139
|
|
||
Deferred Income Taxes (Note 5)
|
2,039
|
|
|
2,008
|
|
||
Other Assets
|
805
|
|
|
792
|
|
||
Property, Plant and Equipment, less Accumulated Depreciation — $10,350 ($10,078 in 2017)
|
7,502
|
|
|
7,451
|
|
||
Total Assets
|
$
|
17,580
|
|
|
$
|
17,064
|
|
|
|
|
|
||||
Liabilities:
|
|
|
|
||||
Current Liabilities:
|
|
|
|
||||
Accounts Payable — Trade
|
$
|
2,850
|
|
|
$
|
2,807
|
|
Compensation and Benefits (Notes 10 and 11)
|
534
|
|
|
539
|
|
||
Other Current Liabilities
|
898
|
|
|
1,026
|
|
||
Notes Payable and Overdrafts (Note 8)
|
332
|
|
|
262
|
|
||
Long Term Debt and Capital Leases due Within One Year (Note 8)
|
327
|
|
|
391
|
|
||
Total Current Liabilities
|
4,941
|
|
|
5,025
|
|
||
Long Term Debt and Capital Leases (Note 8)
|
5,600
|
|
|
5,076
|
|
||
Compensation and Benefits (Notes 10 and 11)
|
1,478
|
|
|
1,515
|
|
||
Deferred Income Taxes (Note 5)
|
101
|
|
|
100
|
|
||
Other Long Term Liabilities
|
498
|
|
|
498
|
|
||
Total Liabilities
|
12,618
|
|
|
12,214
|
|
||
Commitments and Contingent Liabilities (Note 12)
|
|
|
|
||||
Shareholders’ Equity:
|
|
|
|
|
|
||
Goodyear Shareholders’ Equity:
|
|
|
|
||||
Common Stock, no par value:
|
|
|
|
|
|
||
Authorized, 450 million shares, Outstanding shares — 240 million in 2018 and 2017 after deducting 38 million treasury shares in 2018 and 2017
|
240
|
|
|
240
|
|
||
Capital Surplus
|
2,280
|
|
|
2,295
|
|
||
Retained Earnings
|
6,084
|
|
|
6,044
|
|
||
Accumulated Other Comprehensive Loss
|
(3,867
|
)
|
|
(3,976
|
)
|
||
Goodyear Shareholders’ Equity
|
4,737
|
|
|
4,603
|
|
||
Minority Shareholders’ Equity — Nonredeemable
|
225
|
|
|
247
|
|
||
Total Shareholders’ Equity
|
4,962
|
|
|
4,850
|
|
||
Total Liabilities and Shareholders’ Equity
|
$
|
17,580
|
|
|
$
|
17,064
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions)
|
2018
|
|
2017
|
||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net Income
|
$
|
80
|
|
|
$
|
169
|
|
Adjustments to Reconcile Net Income to Cash Flows from Operating Activities:
|
|
|
|
||||
Depreciation and Amortization
|
199
|
|
|
185
|
|
||
Amortization and Write-Off of Debt Issuance Costs
|
3
|
|
|
3
|
|
||
Provision for Deferred Income Taxes
|
(17
|
)
|
|
40
|
|
||
Net Rationalization Charges (Note 3)
|
37
|
|
|
29
|
|
||
Rationalization Payments
|
(106
|
)
|
|
(18
|
)
|
||
Net (Gains) Losses on Asset Sales (Note 4)
|
2
|
|
|
(1
|
)
|
||
Pension Contributions and Direct Payments
|
(21
|
)
|
|
(25
|
)
|
||
Changes in Operating Assets and Liabilities, Net of Asset Acquisitions and Dispositions:
|
|
|
|
||||
Accounts Receivable
|
(467
|
)
|
|
(478
|
)
|
||
Inventories
|
(81
|
)
|
|
(191
|
)
|
||
Accounts Payable — Trade
|
99
|
|
|
73
|
|
||
Compensation and Benefits
|
(16
|
)
|
|
(61
|
)
|
||
Other Current Liabilities
|
(64
|
)
|
|
18
|
|
||
Other Assets and Liabilities
|
(37
|
)
|
|
(29
|
)
|
||
Total Cash Flows from Operating Activities
|
(389
|
)
|
|
(286
|
)
|
||
Cash Flows from Investing Activities:
|
|
|
|
||||
Capital Expenditures
|
(248
|
)
|
|
(271
|
)
|
||
Asset Dispositions (Note 4)
|
—
|
|
|
1
|
|
||
Short Term Securities Acquired
|
(8
|
)
|
|
(11
|
)
|
||
Short Term Securities Redeemed
|
8
|
|
|
11
|
|
||
Total Cash Flows from Investing Activities
|
(248
|
)
|
|
(270
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Short Term Debt and Overdrafts Incurred
|
584
|
|
|
51
|
|
||
Short Term Debt and Overdrafts Paid
|
(518
|
)
|
|
(82
|
)
|
||
Long Term Debt Incurred
|
1,652
|
|
|
1,838
|
|
||
Long Term Debt Paid
|
(1,226
|
)
|
|
(1,369
|
)
|
||
Common Stock Issued
|
1
|
|
|
9
|
|
||
Common Stock Repurchased (Note 13)
|
(25
|
)
|
|
(25
|
)
|
||
Common Stock Dividends Paid (Note 13)
|
(34
|
)
|
|
(25
|
)
|
||
Transactions with Minority Interests in Subsidiaries
|
(22
|
)
|
|
—
|
|
||
Debt Related Costs and Other Transactions
|
(13
|
)
|
|
1
|
|
||
Total Cash Flows from Financing Activities
|
399
|
|
|
398
|
|
||
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash
|
16
|
|
|
20
|
|
||
Net Change in Cash, Cash Equivalents and Restricted Cash
|
(222
|
)
|
|
(138
|
)
|
||
Cash, Cash Equivalents and Restricted Cash at Beginning of the Period
|
1,110
|
|
|
1,189
|
|
||
Cash, Cash Equivalents and Restricted Cash at End of the Period
|
$
|
888
|
|
|
$
|
1,051
|
|
|
Balance at
|
|
Adjustment for
|
|
Balance at
|
||||||
(In millions)
|
December 31, 2017
|
|
New Standard
|
|
January 1, 2018
|
||||||
Accounts Receivable
|
$
|
2,025
|
|
|
$
|
3
|
|
|
$
|
2,028
|
|
Prepaid Expenses and Other Current Assets
|
224
|
|
|
7
|
|
|
231
|
|
|||
Deferred Income Taxes — Asset
|
2,008
|
|
|
1
|
|
|
2,009
|
|
|||
Accounts Payable — Trade
|
2,807
|
|
|
7
|
|
|
2,814
|
|
|||
Other Current Liabilities
|
1,026
|
|
|
7
|
|
|
1,033
|
|
|||
Retained Earnings
|
6,044
|
|
|
(3
|
)
|
|
6,041
|
|
|
As of March 31, 2018
|
||||||||||
|
|
|
Balances
|
|
|
||||||
(In millions)
|
As Reported
|
|
Without Adoption
|
|
Effect of Change
|
||||||
Accounts Receivable
|
$
|
2,509
|
|
|
$
|
2,506
|
|
|
$
|
3
|
|
Prepaid Expenses and Other Current Assets
|
247
|
|
|
236
|
|
|
11
|
|
|||
Deferred Income Taxes — Asset
|
2,039
|
|
|
2,038
|
|
|
1
|
|
|||
Accounts Payable — Trade
|
2,850
|
|
|
2,842
|
|
|
8
|
|
|||
Other Current Liabilities
|
898
|
|
|
887
|
|
|
11
|
|
|||
Retained Earnings
|
6,084
|
|
|
6,080
|
|
|
(4
|
)
|
|
March 31,
|
||||||
(In millions)
|
2018
|
|
2017
|
||||
Cash and Cash Equivalents
|
$
|
837
|
|
|
$
|
961
|
|
Restricted Cash
|
51
|
|
|
90
|
|
||
Total Cash, Cash Equivalents and Restricted Cash
|
$
|
888
|
|
|
$
|
1,051
|
|
|
Three Months Ended March 31, 2018
|
||||||||||||||
|
|
|
Europe, Middle East
|
|
|
|
|
||||||||
(In millions)
|
Americas
|
|
and Africa
|
|
Asia Pacific
|
|
Total
|
||||||||
Tire unit sales
|
$
|
1,506
|
|
|
$
|
1,209
|
|
|
$
|
518
|
|
|
$
|
3,233
|
|
Other tire and related sales
|
135
|
|
|
105
|
|
|
30
|
|
|
270
|
|
||||
Retail services and service related sales
|
137
|
|
|
15
|
|
|
22
|
|
|
174
|
|
||||
Chemical
|
148
|
|
|
—
|
|
|
—
|
|
|
148
|
|
||||
Other
|
3
|
|
|
1
|
|
|
1
|
|
|
5
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net Sales by reportable segment
|
$
|
1,929
|
|
|
$
|
1,330
|
|
|
$
|
571
|
|
|
$
|
3,830
|
|
|
|
|
Other Exit and
|
|
|
||||||
|
Associate-
|
|
Non-cancelable
|
|
|
||||||
(In millions)
|
Related Costs
|
|
Lease Costs
|
|
Total
|
||||||
Balance at December 31, 2017
|
$
|
210
|
|
|
$
|
3
|
|
|
$
|
213
|
|
2018 Charges
|
34
|
|
|
8
|
|
|
42
|
|
|||
Incurred, including net Foreign Currency Translation of ($5) million and $0 million, respectively
|
(93
|
)
|
|
(8
|
)
|
|
(101
|
)
|
|||
Reversed to the Statements of Operations
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
|||
Balance at March 31, 2018
|
$
|
146
|
|
|
$
|
3
|
|
|
$
|
149
|
|
|
Three Months Ended
|
||||||
(In millions)
|
March 31,
|
||||||
|
2018
|
|
2017
|
||||
Current Year Plans
|
|
|
|
||||
Associate Severance and Other Related Costs
|
$
|
31
|
|
|
$
|
23
|
|
Current Year Plans - Net Charges
|
$
|
31
|
|
|
$
|
23
|
|
|
|
|
|
||||
Prior Year Plans
|
|
|
|
||||
Associate Severance and Other Related Costs
|
$
|
(2
|
)
|
|
$
|
—
|
|
Other Exit and Non-Cancelable Lease Costs
|
8
|
|
|
6
|
|
||
Prior Year Plans - Net Charges
|
6
|
|
|
6
|
|
||
Total Net Charges
|
$
|
37
|
|
|
$
|
29
|
|
|
|
|
|
||||
Asset Write-off and Accelerated Depreciation Charges
|
$
|
1
|
|
|
$
|
8
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions)
|
2018
|
|
2017
|
||||
Non-service related pension and other postretirement benefits cost
|
$
|
34
|
|
|
$
|
8
|
|
Financing fees and financial instruments
|
9
|
|
|
8
|
|
||
Net foreign currency exchange (gains) losses
|
(7
|
)
|
|
(1
|
)
|
||
Royalty income
|
(5
|
)
|
|
(5
|
)
|
||
Interest income
|
(4
|
)
|
|
(4
|
)
|
||
Net (gains) losses on asset sales
|
2
|
|
|
(1
|
)
|
||
General and product liability expense (income) - discontinued products
|
1
|
|
|
2
|
|
||
Miscellaneous expense
|
7
|
|
|
1
|
|
||
|
$
|
37
|
|
|
$
|
8
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions, except per share amounts)
|
2018
|
|
2017
|
||||
Earnings per share — basic:
|
|
|
|
||||
Goodyear net income
|
$
|
75
|
|
|
$
|
166
|
|
Weighted average shares outstanding
|
240
|
|
|
252
|
|
||
Earnings per common share — basic
|
$
|
0.31
|
|
|
$
|
0.66
|
|
|
|
|
|
||||
Earnings per share — diluted:
|
|
|
|
||||
Goodyear net income
|
$
|
75
|
|
|
$
|
166
|
|
Weighted average shares outstanding
|
240
|
|
|
252
|
|
||
Dilutive effect of stock options and other dilutive securities
|
4
|
|
|
4
|
|
||
Weighted average shares outstanding — diluted
|
244
|
|
|
256
|
|
||
Earnings per common share — diluted
|
$
|
0.31
|
|
|
$
|
0.65
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions)
|
2018
|
|
2017
|
||||
Sales:
|
|
|
|
||||
Americas
|
$
|
1,929
|
|
|
$
|
1,958
|
|
Europe, Middle East and Africa
|
1,330
|
|
|
1,239
|
|
||
Asia Pacific
|
571
|
|
|
502
|
|
||
Net Sales
|
$
|
3,830
|
|
|
$
|
3,699
|
|
Segment Operating Income:
|
|
|
|
||||
Americas
|
$
|
127
|
|
|
$
|
216
|
|
Europe, Middle East and Africa
|
78
|
|
|
101
|
|
||
Asia Pacific
|
76
|
|
|
73
|
|
||
Total Segment Operating Income
|
$
|
281
|
|
|
$
|
390
|
|
Less:
|
|
|
|
||||
Rationalizations
|
$
|
37
|
|
|
$
|
29
|
|
Interest expense
|
76
|
|
|
87
|
|
||
Other (income) expense (Note 4)
|
37
|
|
|
8
|
|
||
Asset write-offs and accelerated depreciation
|
1
|
|
|
8
|
|
||
Corporate incentive compensation plans
|
4
|
|
|
15
|
|
||
Intercompany profit elimination
|
(3
|
)
|
|
(3
|
)
|
||
Retained expenses of divested operations
|
3
|
|
|
3
|
|
||
Other
|
13
|
|
|
4
|
|
||
Income before Income Taxes
|
$
|
113
|
|
|
$
|
239
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions)
|
2018
|
|
2017
|
||||
Rationalizations:
|
|
|
|
||||
Americas
|
$
|
3
|
|
|
$
|
1
|
|
Europe, Middle East and Africa
|
27
|
|
|
27
|
|
||
Asia Pacific
|
3
|
|
|
1
|
|
||
Total Segment Rationalizations
|
$
|
33
|
|
|
$
|
29
|
|
Corporate
|
4
|
|
|
—
|
|
||
Total Rationalizations
|
$
|
37
|
|
|
$
|
29
|
|
|
|
|
|
||||
Net (Gains) Losses on Asset Sales:
|
|
|
|
||||
Americas
|
$
|
—
|
|
|
$
|
(1
|
)
|
Europe, Middle East and Africa
|
2
|
|
|
—
|
|
||
Total Net (Gains) Losses on Asset Sales
|
$
|
2
|
|
|
$
|
(1
|
)
|
Asset Write-offs and Accelerated Depreciation:
|
|
|
|
||||
Europe, Middle East and Africa
|
$
|
1
|
|
|
$
|
8
|
|
Total Segment Asset Write-offs and Accelerated Depreciation
|
$
|
1
|
|
|
$
|
8
|
|
|
March 31,
|
|
December 31,
|
||||
(In millions)
|
2018
|
|
2017
|
||||
Notes payable and overdrafts
|
$
|
332
|
|
|
$
|
262
|
|
Weighted average interest rate
|
4.62
|
%
|
|
5.00
|
%
|
||
|
|
|
|
||||
Chinese credit facilities
|
$
|
73
|
|
|
$
|
113
|
|
Other domestic and foreign debt (including capital leases)
|
254
|
|
|
278
|
|
||
Long term debt and capital leases due within one year
|
$
|
327
|
|
|
$
|
391
|
|
Weighted average interest rate
|
5.42
|
%
|
|
6.86
|
%
|
||
Total obligations due within one year
|
$
|
659
|
|
|
$
|
653
|
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||||
|
|
|
Interest
|
|
|
|
Interest
|
||||||
(In millions)
|
Amount
|
|
Rate
|
|
Amount
|
|
Rate
|
||||||
Notes:
|
|
|
|
|
|
|
|
||||||
8.75% due 2020
|
$
|
276
|
|
|
|
|
$
|
275
|
|
|
|
||
5.125% due 2023
|
1,000
|
|
|
|
|
1,000
|
|
|
|
||||
3.75% Euro Notes due 2023
|
308
|
|
|
|
|
300
|
|
|
|
||||
5% due 2026
|
900
|
|
|
|
|
900
|
|
|
|
||||
4.875% due 2027
|
700
|
|
|
|
|
700
|
|
|
|
||||
7% due 2028
|
150
|
|
|
|
|
150
|
|
|
|
||||
Credit Facilities:
|
|
|
|
|
|
|
|
||||||
$2.0 billion first lien revolving credit facility due 2021
|
165
|
|
|
3.01
|
%
|
|
—
|
|
|
—
|
|
||
Second lien term loan facility due 2025
|
400
|
|
|
3.71
|
%
|
|
400
|
|
|
3.50
|
%
|
||
€550 million revolving credit facility due 2020
|
401
|
|
|
1.75
|
%
|
|
—
|
|
|
—
|
|
||
Pan-European accounts receivable facility
|
153
|
|
|
0.96
|
%
|
|
224
|
|
|
0.90
|
%
|
||
Mexican credit facilities
|
340
|
|
|
3.19
|
%
|
|
340
|
|
|
3.14
|
%
|
||
Chinese credit facilities
|
185
|
|
|
4.99
|
%
|
|
212
|
|
|
4.87
|
%
|
||
Other foreign and domestic debt
(1)
|
949
|
|
|
5.63
|
%
|
|
967
|
|
|
6.02
|
%
|
||
|
5,927
|
|
|
|
|
5,468
|
|
|
|
||||
Unamortized deferred financing fees
|
(41
|
)
|
|
|
|
(41
|
)
|
|
|
||||
|
5,886
|
|
|
|
|
5,427
|
|
|
|
||||
Capital lease obligations
|
41
|
|
|
|
|
40
|
|
|
|
||||
|
5,927
|
|
|
|
|
5,467
|
|
|
|
||||
Less portion due within one year
|
(327
|
)
|
|
|
|
(391
|
)
|
|
|
||||
|
$
|
5,600
|
|
|
|
|
$
|
5,076
|
|
|
|
(1)
|
Interest rates are weighted average interest rates related to various foreign credit facilities with customary terms and conditions and domestic debt related to our Global and Americas Headquarters.
|
|
March 31,
|
|
December 31,
|
||||
(In millions)
|
2018
|
|
2017
|
||||
Fair Values — Current asset (liability):
|
|
|
|
||||
Accounts receivable
|
$
|
19
|
|
|
$
|
3
|
|
Other current liabilities
|
(7
|
)
|
|
(9
|
)
|
|
March 31,
|
|
December 31,
|
||||
(In millions)
|
2018
|
|
2017
|
||||
Fair Values — Current asset (liability):
|
|
|
|
||||
Accounts receivable
|
$
|
1
|
|
|
$
|
1
|
|
Other current liabilities
|
(10
|
)
|
|
(8
|
)
|
||
Fair Values — Long term asset (liability):
|
|
|
|
||||
Other long term liabilities
|
$
|
(2
|
)
|
|
$
|
(2
|
)
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions) (Income) Expense
|
2018
|
|
2017
|
||||
Amounts deferred to Accumulated Other Comprehensive Loss ("AOCL")
|
$
|
6
|
|
|
$
|
8
|
|
Amount of deferred (gain) loss reclassified from AOCL into CGS
|
4
|
|
|
(2
|
)
|
||
Amounts excluded from effectiveness testing
|
—
|
|
|
(1
|
)
|
|
Total Carrying Value in the
Consolidated
Balance Sheet
|
|
Quoted Prices in Active Markets for Identical
Assets/Liabilities
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant Unobservable
Inputs
(Level 3)
|
||||||||||||||||||||||||
(In millions)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Investments
|
$
|
10
|
|
|
$
|
11
|
|
|
$
|
10
|
|
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Foreign Exchange Contracts
|
20
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
20
|
|
|
4
|
|
|
—
|
|
|
—
|
|
||||||||
Total Assets at Fair Value
|
$
|
30
|
|
|
$
|
15
|
|
|
$
|
10
|
|
|
$
|
11
|
|
|
$
|
20
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Foreign Exchange Contracts
|
$
|
19
|
|
|
$
|
19
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
19
|
|
|
$
|
19
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total Liabilities at Fair Value
|
$
|
19
|
|
|
$
|
19
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
19
|
|
|
$
|
19
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
March 31,
|
|
December 31,
|
||||
(In millions)
|
2018
|
|
2017
|
||||
Fixed Rate Debt
(1)
:
|
|
|
|
||||
Carrying amount — liability
|
$
|
3,625
|
|
|
$
|
3,616
|
|
Fair value — liability
|
3,651
|
|
|
3,786
|
|
||
|
|
|
|
||||
Variable Rate Debt
(1)
:
|
|
|
|
||||
Carrying amount — liability
|
$
|
2,261
|
|
|
$
|
1,811
|
|
Fair value — liability
|
2,248
|
|
|
1,811
|
|
(1)
|
Excludes Notes Payable and Overdrafts of $
332 million
and $
262 million
at March 31, 2018 and December 31, 2017, respectively, of which $
176 million
and $
110 million
, respectively, are at fixed rates and $
156 million
and $
152 million
, respectively, are at variable rates. The carrying value of Notes Payable and Overdrafts approximates fair value due to the short term nature of the facilities.
|
|
U.S.
|
||||||
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions)
|
2018
|
|
2017
|
||||
Service cost
|
$
|
1
|
|
|
$
|
1
|
|
Interest cost
|
40
|
|
|
40
|
|
||
Expected return on plan assets
|
(55
|
)
|
|
(60
|
)
|
||
Amortization of net losses
|
28
|
|
|
28
|
|
||
Net periodic pension cost
|
$
|
14
|
|
|
$
|
9
|
|
|
Non-U.S.
|
||||||
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions)
|
2018
|
|
2017
|
||||
Service cost
|
$
|
7
|
|
|
$
|
7
|
|
Interest cost
|
18
|
|
|
17
|
|
||
Expected return on plan assets
|
(18
|
)
|
|
(19
|
)
|
||
Amortization of net losses
|
7
|
|
|
8
|
|
||
Net periodic pension cost
|
$
|
14
|
|
|
$
|
13
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
||||
(Dollars in millions)
|
March 31, 2018
|
|
December 31, 2017
|
||||
Pending claims, beginning of period
|
54,300
|
|
|
64,400
|
|
||
New claims filed
|
400
|
|
|
1,900
|
|
||
Claims settled/dismissed
|
(4,700
|
)
|
|
(12,000
|
)
|
||
Pending claims, end of period
|
50,000
|
|
|
54,300
|
|
||
Payments
(1)
|
$
|
3
|
|
|
$
|
16
|
|
(1)
|
Represents cash payments made during the period by us and our insurers on asbestos litigation defense and claim resolution.
|
|
March 31, 2018
|
|
March 31, 2017
|
||||||||||||||||||||
(In millions)
|
Goodyear
Shareholders’ Equity
|
|
Minority
Shareholders’
Equity – Nonredeemable
|
|
Total
Shareholders’ Equity
|
|
Goodyear
Shareholders’ Equity
|
|
Minority
Shareholders’
Equity – Nonredeemable
|
|
Total
Shareholders’ Equity
|
||||||||||||
Balance at beginning of period
|
$
|
4,603
|
|
|
$
|
247
|
|
|
$
|
4,850
|
|
|
$
|
4,507
|
|
|
$
|
218
|
|
|
$
|
4,725
|
|
Comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income
|
75
|
|
|
5
|
|
|
80
|
|
|
166
|
|
|
3
|
|
|
169
|
|
||||||
Foreign currency translation, net of tax of ($2) in 2018 ($3 in 2017)
|
80
|
|
|
2
|
|
|
82
|
|
|
78
|
|
|
6
|
|
|
84
|
|
||||||
Amortization of prior service cost and unrecognized gains (losses) included in total benefit cost, net of tax of $8 in 2018 ($10 in 2017)
|
27
|
|
|
—
|
|
|
27
|
|
|
20
|
|
|
—
|
|
|
20
|
|
||||||
(Increase)/Decrease in net actuarial losses, net of tax of $1 in 2018 ($1 in 2017)
|
3
|
|
|
—
|
|
|
3
|
|
|
4
|
|
|
—
|
|
|
4
|
|
||||||
Deferred derivative gains (losses), net of tax of ($2) in 2018 (($2) in 2017)
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|
(6
|
)
|
|
—
|
|
|
(6
|
)
|
||||||
Reclassification adjustment for amounts recognized in income, net of tax of $1 in 2018 (($1) in 2017)
|
3
|
|
|
—
|
|
|
3
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||||
Other comprehensive income
|
109
|
|
|
2
|
|
|
111
|
|
|
95
|
|
|
6
|
|
|
101
|
|
||||||
Total comprehensive income
|
184
|
|
|
7
|
|
|
191
|
|
|
261
|
|
|
9
|
|
|
270
|
|
||||||
Adoption of new accounting standards updates (Note 1)
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Stock-based compensation plans (Note 11)
|
4
|
|
|
—
|
|
|
4
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||||
Repurchase of common stock (Note 13)
|
(25
|
)
|
|
—
|
|
|
(25
|
)
|
|
(25
|
)
|
|
—
|
|
|
(25
|
)
|
||||||
Dividends declared (Note 13)
|
(34
|
)
|
|
—
|
|
|
(34
|
)
|
|
(25
|
)
|
|
—
|
|
|
(25
|
)
|
||||||
Common stock issued from treasury
|
1
|
|
|
—
|
|
|
1
|
|
|
9
|
|
|
—
|
|
|
9
|
|
||||||
Purchase of minority shares
|
5
|
|
|
(29
|
)
|
|
(24
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at end of period
|
$
|
4,737
|
|
|
$
|
225
|
|
|
$
|
4,962
|
|
|
$
|
4,733
|
|
|
$
|
227
|
|
|
$
|
4,960
|
|
(In millions) Income (Loss)
|
Foreign Currency Translation Adjustment
|
|
Unrecognized Net Actuarial Losses and Prior Service Costs
|
|
Deferred Derivative Gains (Losses)
|
|
Total
|
||||||||
Balance at December 31, 2017
|
$
|
(915
|
)
|
|
$
|
(3,052
|
)
|
|
$
|
(9
|
)
|
|
$
|
(3,976
|
)
|
Other comprehensive income (loss) before reclassifications, net of tax
|
80
|
|
|
3
|
|
|
(4
|
)
|
|
79
|
|
||||
Amounts reclassified from accumulated other comprehensive loss, net of tax
|
—
|
|
|
27
|
|
|
3
|
|
|
30
|
|
||||
Balance at March 31, 2018
|
$
|
(835
|
)
|
|
$
|
(3,022
|
)
|
|
$
|
(10
|
)
|
|
$
|
(3,867
|
)
|
|
|
|
|
|
|
|
|
||||||||
(In millions) Income (Loss)
|
Foreign Currency Translation Adjustment
|
|
Unrecognized Net Actuarial Losses and Prior Service Costs
|
|
Deferred Derivative Gains (Losses)
|
|
Total
|
||||||||
Balance at December 31, 2016
|
$
|
(1,155
|
)
|
|
$
|
(3,053
|
)
|
|
$
|
10
|
|
|
$
|
(4,198
|
)
|
Other comprehensive income (loss) before reclassifications, net of tax
|
78
|
|
|
4
|
|
|
(6
|
)
|
|
76
|
|
||||
Amounts reclassified from accumulated other comprehensive loss, net of tax
|
—
|
|
|
20
|
|
|
(1
|
)
|
|
19
|
|
||||
Balance at March 31, 2017
|
$
|
(1,077
|
)
|
|
$
|
(3,029
|
)
|
|
$
|
3
|
|
|
$
|
(4,103
|
)
|
|
Three Months Ended March 31,
|
|
|
||||||
(In millions) (Income) Expense
|
2018
|
|
2017
|
|
|
||||
Component of AOCL
|
Amount Reclassified from AOCL
|
|
Affected Line Item in the Consolidated Statements of Operations
|
||||||
Amortization of prior service cost and unrecognized gains and losses
|
$
|
35
|
|
|
$
|
30
|
|
|
Total Benefit Cost
|
Tax effect
|
(8
|
)
|
|
(10
|
)
|
|
United States and Foreign Taxes
|
||
Net of tax
|
$
|
27
|
|
|
$
|
20
|
|
|
Goodyear Net Income
|
|
|
|
|
|
|
||||
Deferred Derivative (Gains) Losses, before tax
|
$
|
4
|
|
|
$
|
(2
|
)
|
|
Cost of Goods Sold
|
Tax effect
|
(1
|
)
|
|
1
|
|
|
United States and Foreign Taxes
|
||
Net of tax
|
$
|
3
|
|
|
$
|
(1
|
)
|
|
Goodyear Net Income
|
|
|
|
|
|
|
||||
Total reclassifications
|
$
|
30
|
|
|
$
|
19
|
|
|
Goodyear Net Income
|
(i)
|
The Goodyear Tire & Rubber Company (the “Parent Company”), the issuer of the guaranteed obligations;
|
(ii)
|
Guarantor Subsidiaries, on a combined basis, as specified in the indentures related to Goodyear’s obligations under the notes;
|
(iii)
|
Non-Guarantor Subsidiaries, on a combined basis;
|
(iv)
|
Consolidating entries and eliminations representing adjustments to (a) eliminate intercompany transactions between the Parent Company, the Guarantor Subsidiaries and the Non-Guarantor Subsidiaries, (b) eliminate the investments in our subsidiaries, and (c) record consolidating entries; and
|
(v)
|
The Goodyear Tire & Rubber Company and Subsidiaries on a consolidated basis.
|
|
Condensed Consolidating Balance Sheet
|
||||||||||||||||||
|
March 31, 2018
|
||||||||||||||||||
(In millions)
|
Parent Company
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Entries and Eliminations
|
|
Consolidated
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and Cash Equivalents
|
$
|
125
|
|
|
$
|
26
|
|
|
$
|
686
|
|
|
$
|
—
|
|
|
$
|
837
|
|
Accounts Receivable, net
|
628
|
|
|
126
|
|
|
1,755
|
|
|
—
|
|
|
2,509
|
|
|||||
Accounts Receivable From Affiliates
|
—
|
|
|
264
|
|
|
32
|
|
|
(296
|
)
|
|
—
|
|
|||||
Inventories
|
1,505
|
|
|
53
|
|
|
1,364
|
|
|
(27
|
)
|
|
2,895
|
|
|||||
Prepaid Expenses and Other Current Assets
|
82
|
|
|
1
|
|
|
162
|
|
|
2
|
|
|
247
|
|
|||||
Total Current Assets
|
2,340
|
|
|
470
|
|
|
3,999
|
|
|
(321
|
)
|
|
6,488
|
|
|||||
Goodwill
|
24
|
|
|
1
|
|
|
453
|
|
|
128
|
|
|
606
|
|
|||||
Intangible Assets
|
119
|
|
|
—
|
|
|
21
|
|
|
—
|
|
|
140
|
|
|||||
Deferred Income Taxes
|
1,552
|
|
|
33
|
|
|
451
|
|
|
3
|
|
|
2,039
|
|
|||||
Other Assets
|
216
|
|
|
50
|
|
|
539
|
|
|
—
|
|
|
805
|
|
|||||
Investments in Subsidiaries
|
4,601
|
|
|
537
|
|
|
—
|
|
|
(5,138
|
)
|
|
—
|
|
|||||
Property, Plant and Equipment, net
|
2,471
|
|
|
426
|
|
|
4,632
|
|
|
(27
|
)
|
|
7,502
|
|
|||||
Total Assets
|
$
|
11,323
|
|
|
$
|
1,517
|
|
|
$
|
10,095
|
|
|
$
|
(5,355
|
)
|
|
$
|
17,580
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts Payable-Trade
|
$
|
875
|
|
|
$
|
113
|
|
|
$
|
1,862
|
|
|
$
|
—
|
|
|
$
|
2,850
|
|
Accounts Payable to Affiliates
|
296
|
|
|
—
|
|
|
—
|
|
|
(296
|
)
|
|
—
|
|
|||||
Compensation and Benefits
|
303
|
|
|
16
|
|
|
215
|
|
|
—
|
|
|
534
|
|
|||||
Other Current Liabilities
|
342
|
|
|
(3
|
)
|
|
559
|
|
|
—
|
|
|
898
|
|
|||||
Notes Payable and Overdrafts
|
—
|
|
|
—
|
|
|
332
|
|
|
—
|
|
|
332
|
|
|||||
Long Term Debt and Capital Leases Due Within One Year
|
59
|
|
|
—
|
|
|
268
|
|
|
—
|
|
|
327
|
|
|||||
Total Current Liabilities
|
1,875
|
|
|
126
|
|
|
3,236
|
|
|
(296
|
)
|
|
4,941
|
|
|||||
Long Term Debt and Capital Leases
|
3,710
|
|
|
167
|
|
|
1,723
|
|
|
—
|
|
|
5,600
|
|
|||||
Compensation and Benefits
|
642
|
|
|
104
|
|
|
732
|
|
|
—
|
|
|
1,478
|
|
|||||
Deferred Income Taxes
|
—
|
|
|
—
|
|
|
101
|
|
|
—
|
|
|
101
|
|
|||||
Other Long Term Liabilities
|
359
|
|
|
9
|
|
|
130
|
|
|
—
|
|
|
498
|
|
|||||
Total Liabilities
|
6,586
|
|
|
406
|
|
|
5,922
|
|
|
(296
|
)
|
|
12,618
|
|
|||||
Commitments and Contingent Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Shareholders’ Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Goodyear Shareholders’ Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Common Stock
|
240
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
240
|
|
|||||
Other Equity
|
4,497
|
|
|
1,111
|
|
|
3,948
|
|
|
(5,059
|
)
|
|
4,497
|
|
|||||
Goodyear Shareholders’ Equity
|
4,737
|
|
|
1,111
|
|
|
3,948
|
|
|
(5,059
|
)
|
|
4,737
|
|
|||||
Minority Shareholders’ Equity — Nonredeemable
|
—
|
|
|
—
|
|
|
225
|
|
|
—
|
|
|
225
|
|
|||||
Total Shareholders’ Equity
|
4,737
|
|
|
1,111
|
|
|
4,173
|
|
|
(5,059
|
)
|
|
4,962
|
|
|||||
Total Liabilities and Shareholders’ Equity
|
$
|
11,323
|
|
|
$
|
1,517
|
|
|
$
|
10,095
|
|
|
$
|
(5,355
|
)
|
|
$
|
17,580
|
|
|
Condensed Consolidating Balance Sheet
|
||||||||||||||||||
|
December 31, 2017
|
||||||||||||||||||
(In millions)
|
Parent Company
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Entries and Eliminations
|
|
Consolidated
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and Cash Equivalents
|
$
|
176
|
|
|
$
|
32
|
|
|
$
|
835
|
|
|
$
|
—
|
|
|
$
|
1,043
|
|
Accounts Receivable, net
|
649
|
|
|
116
|
|
|
1,260
|
|
|
—
|
|
|
2,025
|
|
|||||
Accounts Receivable From Affiliates
|
—
|
|
|
254
|
|
|
71
|
|
|
(325
|
)
|
|
—
|
|
|||||
Inventories
|
1,444
|
|
|
43
|
|
|
1,329
|
|
|
(29
|
)
|
|
2,787
|
|
|||||
Prepaid Expenses and Other Current Assets
|
59
|
|
|
3
|
|
|
157
|
|
|
5
|
|
|
224
|
|
|||||
Total Current Assets
|
2,328
|
|
|
448
|
|
|
3,652
|
|
|
(349
|
)
|
|
6,079
|
|
|||||
Goodwill
|
24
|
|
|
1
|
|
|
444
|
|
|
126
|
|
|
595
|
|
|||||
Intangible Assets
|
119
|
|
|
—
|
|
|
20
|
|
|
—
|
|
|
139
|
|
|||||
Deferred Income Taxes
|
1,549
|
|
|
35
|
|
|
424
|
|
|
—
|
|
|
2,008
|
|
|||||
Other Assets
|
221
|
|
|
51
|
|
|
518
|
|
|
2
|
|
|
792
|
|
|||||
Investments in Subsidiaries
|
4,424
|
|
|
503
|
|
|
—
|
|
|
(4,927
|
)
|
|
—
|
|
|||||
Property, Plant and Equipment, net
|
2,491
|
|
|
420
|
|
|
4,569
|
|
|
(29
|
)
|
|
7,451
|
|
|||||
Total Assets
|
$
|
11,156
|
|
|
$
|
1,458
|
|
|
$
|
9,627
|
|
|
$
|
(5,177
|
)
|
|
$
|
17,064
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts Payable-Trade
|
$
|
927
|
|
|
$
|
115
|
|
|
$
|
1,765
|
|
|
$
|
—
|
|
|
$
|
2,807
|
|
Accounts Payable to Affiliates
|
325
|
|
|
—
|
|
|
—
|
|
|
(325
|
)
|
|
—
|
|
|||||
Compensation and Benefits
|
322
|
|
|
15
|
|
|
202
|
|
|
—
|
|
|
539
|
|
|||||
Other Current Liabilities
|
323
|
|
|
2
|
|
|
701
|
|
|
—
|
|
|
1,026
|
|
|||||
Notes Payable and Overdrafts
|
—
|
|
|
—
|
|
|
262
|
|
|
—
|
|
|
262
|
|
|||||
Long Term Debt and Capital Leases Due Within One Year
|
60
|
|
|
—
|
|
|
331
|
|
|
—
|
|
|
391
|
|
|||||
Total Current Liabilities
|
1,957
|
|
|
132
|
|
|
3,261
|
|
|
(325
|
)
|
|
5,025
|
|
|||||
Long Term Debt and Capital Leases
|
3,544
|
|
|
152
|
|
|
1,380
|
|
|
—
|
|
|
5,076
|
|
|||||
Compensation and Benefits
|
682
|
|
|
109
|
|
|
724
|
|
|
—
|
|
|
1,515
|
|
|||||
Deferred Income Taxes
|
—
|
|
|
1
|
|
|
99
|
|
|
—
|
|
|
100
|
|
|||||
Other Long Term Liabilities
|
370
|
|
|
8
|
|
|
120
|
|
|
—
|
|
|
498
|
|
|||||
Total Liabilities
|
6,553
|
|
|
402
|
|
|
5,584
|
|
|
(325
|
)
|
|
12,214
|
|
|||||
Commitments and Contingent Liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
Shareholders’ Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Goodyear Shareholders’ Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Common Stock
|
240
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
240
|
|
|||||
Other Equity
|
4,363
|
|
|
1,056
|
|
|
3,796
|
|
|
(4,852
|
)
|
|
4,363
|
|
|||||
Goodyear Shareholders’ Equity
|
4,603
|
|
|
1,056
|
|
|
3,796
|
|
|
(4,852
|
)
|
|
4,603
|
|
|||||
Minority Shareholders’ Equity — Nonredeemable
|
—
|
|
|
—
|
|
|
247
|
|
|
—
|
|
|
247
|
|
|||||
Total Shareholders’ Equity
|
4,603
|
|
|
1,056
|
|
|
4,043
|
|
|
(4,852
|
)
|
|
4,850
|
|
|||||
Total Liabilities and Shareholders’ Equity
|
$
|
11,156
|
|
|
$
|
1,458
|
|
|
$
|
9,627
|
|
|
$
|
(5,177
|
)
|
|
$
|
17,064
|
|
|
Consolidating Statements of Operations
|
||||||||||||||||||
|
Three Months Ended March 31, 2018
|
||||||||||||||||||
(In millions)
|
Parent Company
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Entries and Eliminations
|
|
Consolidated
|
||||||||||
Net Sales
|
$
|
1,684
|
|
|
$
|
309
|
|
|
$
|
2,457
|
|
|
$
|
(620
|
)
|
|
$
|
3,830
|
|
Cost of Goods Sold
|
1,365
|
|
|
273
|
|
|
1,978
|
|
|
(640
|
)
|
|
2,976
|
|
|||||
Selling, Administrative and General Expense
|
259
|
|
|
10
|
|
|
322
|
|
|
—
|
|
|
591
|
|
|||||
Rationalizations
|
6
|
|
|
—
|
|
|
31
|
|
|
—
|
|
|
37
|
|
|||||
Interest Expense
|
54
|
|
|
5
|
|
|
23
|
|
|
(6
|
)
|
|
76
|
|
|||||
Other (Income) Expense
|
10
|
|
|
7
|
|
|
—
|
|
|
20
|
|
|
37
|
|
|||||
Income (Loss) before Income Taxes and Equity in Earnings of Subsidiaries
|
(10
|
)
|
|
14
|
|
|
103
|
|
|
6
|
|
|
113
|
|
|||||
United States and Foreign Taxes
|
(3
|
)
|
|
3
|
|
|
30
|
|
|
3
|
|
|
33
|
|
|||||
Equity in Earnings of Subsidiaries
|
82
|
|
|
22
|
|
|
—
|
|
|
(104
|
)
|
|
—
|
|
|||||
Net Income (Loss)
|
75
|
|
|
33
|
|
|
73
|
|
|
(101
|
)
|
|
80
|
|
|||||
Less: Minority Shareholders’ Net Income
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
|||||
Goodyear Net Income (Loss)
|
$
|
75
|
|
|
$
|
33
|
|
|
$
|
68
|
|
|
$
|
(101
|
)
|
|
$
|
75
|
|
Comprehensive Income (Loss)
|
$
|
184
|
|
|
$
|
55
|
|
|
$
|
155
|
|
|
$
|
(203
|
)
|
|
$
|
191
|
|
Less: Comprehensive Income (Loss) Attributable to Minority Shareholders
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
|||||
Goodyear Comprehensive Income (Loss)
|
$
|
184
|
|
|
$
|
55
|
|
|
$
|
148
|
|
|
$
|
(203
|
)
|
|
$
|
184
|
|
|
Consolidating Statements of Operations
|
||||||||||||||||||
|
Three Months Ended March 31, 2017
|
||||||||||||||||||
(In millions)
|
Parent Company
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Entries and Eliminations
|
|
Consolidated
|
||||||||||
Net Sales
|
$
|
1,767
|
|
|
$
|
299
|
|
|
$
|
2,302
|
|
|
$
|
(669
|
)
|
|
$
|
3,699
|
|
Cost of Goods Sold
|
1,378
|
|
|
273
|
|
|
1,794
|
|
|
(685
|
)
|
|
2,760
|
|
|||||
Selling, Administrative and General Expense
|
259
|
|
|
8
|
|
|
310
|
|
|
(1
|
)
|
|
576
|
|
|||||
Rationalizations
|
1
|
|
|
—
|
|
|
28
|
|
|
—
|
|
|
29
|
|
|||||
Interest Expense
|
65
|
|
|
2
|
|
|
31
|
|
|
(11
|
)
|
|
87
|
|
|||||
Other (Income) Expense
|
(17
|
)
|
|
4
|
|
|
—
|
|
|
21
|
|
|
8
|
|
|||||
Income (Loss) before Income Taxes and Equity in Earnings of Subsidiaries
|
81
|
|
|
12
|
|
|
139
|
|
|
7
|
|
|
239
|
|
|||||
United States and Foreign Taxes
|
43
|
|
|
3
|
|
|
29
|
|
|
(5
|
)
|
|
70
|
|
|||||
Equity in Earnings of Subsidiaries
|
128
|
|
|
15
|
|
|
—
|
|
|
(143
|
)
|
|
—
|
|
|||||
Net Income (Loss)
|
166
|
|
|
24
|
|
|
110
|
|
|
(131
|
)
|
|
169
|
|
|||||
Less: Minority Shareholders’ Net Income
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
|||||
Goodyear Net Income (Loss)
|
$
|
166
|
|
|
$
|
24
|
|
|
$
|
107
|
|
|
$
|
(131
|
)
|
|
$
|
166
|
|
Comprehensive Income (Loss)
|
$
|
261
|
|
|
$
|
28
|
|
|
$
|
194
|
|
|
$
|
(213
|
)
|
|
$
|
270
|
|
Less: Comprehensive Income (Loss) Attributable to Minority Shareholders
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
9
|
|
|||||
Goodyear Comprehensive Income (Loss)
|
$
|
261
|
|
|
$
|
28
|
|
|
$
|
185
|
|
|
$
|
(213
|
)
|
|
$
|
261
|
|
|
Condensed Consolidating Statement of Cash Flows
|
||||||||||||||||||
|
Three Months Ended March 31, 2018
|
||||||||||||||||||
(In millions)
|
Parent Company
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Entries and Eliminations
|
|
Consolidated
|
||||||||||
Cash Flows from Operating Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total Cash Flows from Operating Activities
|
$
|
266
|
|
|
$
|
—
|
|
|
$
|
(656
|
)
|
|
$
|
1
|
|
|
$
|
(389
|
)
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital Expenditures
|
(101
|
)
|
|
(28
|
)
|
|
(118
|
)
|
|
(1
|
)
|
|
(248
|
)
|
|||||
Short Term Securities Acquired
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
(8
|
)
|
|||||
Short Term Securities Redeemed
|
—
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
|||||
Capital Contributions and Loans Incurred
|
(91
|
)
|
|
—
|
|
|
(91
|
)
|
|
182
|
|
|
—
|
|
|||||
Capital Redemptions and Loans Paid
|
38
|
|
|
—
|
|
|
360
|
|
|
(398
|
)
|
|
—
|
|
|||||
Total Cash Flows from Investing Activities
|
(154
|
)
|
|
(28
|
)
|
|
151
|
|
|
(217
|
)
|
|
(248
|
)
|
|||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Short Term Debt and Overdrafts Incurred
|
325
|
|
|
—
|
|
|
259
|
|
|
—
|
|
|
584
|
|
|||||
Short Term Debt and Overdrafts Paid
|
(325
|
)
|
|
—
|
|
|
(193
|
)
|
|
—
|
|
|
(518
|
)
|
|||||
Long Term Debt Incurred
|
705
|
|
|
15
|
|
|
932
|
|
|
—
|
|
|
1,652
|
|
|||||
Long Term Debt Paid
|
(541
|
)
|
|
—
|
|
|
(685
|
)
|
|
—
|
|
|
(1,226
|
)
|
|||||
Common Stock Issued
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Common Stock Repurchased
|
(25
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25
|
)
|
|||||
Common Stock Dividends Paid
|
(34
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(34
|
)
|
|||||
Capital Contributions and Loans Incurred
|
91
|
|
|
8
|
|
|
83
|
|
|
(182
|
)
|
|
—
|
|
|||||
Capital Redemptions and Loans Paid
|
(360
|
)
|
|
—
|
|
|
(38
|
)
|
|
398
|
|
|
—
|
|
|||||
Transactions with Minority Interests in Subsidiaries
|
—
|
|
|
—
|
|
|
(22
|
)
|
|
—
|
|
|
(22
|
)
|
|||||
Debt Related Costs and Other Transactions
|
7
|
|
|
—
|
|
|
(20
|
)
|
|
—
|
|
|
(13
|
)
|
|||||
Total Cash Flows from Financing Activities
|
(156
|
)
|
|
23
|
|
|
316
|
|
|
216
|
|
|
399
|
|
|||||
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash
|
—
|
|
|
(1
|
)
|
|
17
|
|
|
—
|
|
|
16
|
|
|||||
Net Change in Cash, Cash Equivalents and Restricted Cash
|
(44
|
)
|
|
(6
|
)
|
|
(172
|
)
|
|
—
|
|
|
(222
|
)
|
|||||
Cash, Cash Equivalents and Restricted Cash at Beginning of the Period
|
201
|
|
|
32
|
|
|
877
|
|
|
—
|
|
|
1,110
|
|
|||||
Cash, Cash Equivalents and Restricted Cash at End of the Period
|
$
|
157
|
|
|
$
|
26
|
|
|
$
|
705
|
|
|
$
|
—
|
|
|
$
|
888
|
|
|
Condensed Consolidating Statement of Cash Flows
|
||||||||||||||||||
|
Three Months Ended March 31, 2017
|
||||||||||||||||||
(In millions)
|
Parent Company
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Entries and Eliminations
|
|
Consolidated
|
||||||||||
Cash Flows from Operating Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total Cash Flows from Operating Activities
|
$
|
(81
|
)
|
|
$
|
(4
|
)
|
|
$
|
(191
|
)
|
|
$
|
(10
|
)
|
|
$
|
(286
|
)
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital Expenditures
|
(113
|
)
|
|
(49
|
)
|
|
(109
|
)
|
|
—
|
|
|
(271
|
)
|
|||||
Asset Dispositions
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Short Term Securities Acquired
|
—
|
|
|
—
|
|
|
(11
|
)
|
|
—
|
|
|
(11
|
)
|
|||||
Short Term Securities Redeemed
|
—
|
|
|
—
|
|
|
11
|
|
|
—
|
|
|
11
|
|
|||||
Capital Contributions and Loans Incurred
|
(23
|
)
|
|
—
|
|
|
(30
|
)
|
|
53
|
|
|
—
|
|
|||||
Capital Redemptions and Loans Paid
|
—
|
|
|
—
|
|
|
448
|
|
|
(448
|
)
|
|
—
|
|
|||||
Total Cash Flows from Investing Activities
|
(135
|
)
|
|
(49
|
)
|
|
309
|
|
|
(395
|
)
|
|
(270
|
)
|
|||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Short Term Debt and Overdrafts Incurred
|
—
|
|
|
—
|
|
|
51
|
|
|
—
|
|
|
51
|
|
|||||
Short Term Debt and Overdrafts Paid
|
—
|
|
|
—
|
|
|
(82
|
)
|
|
—
|
|
|
(82
|
)
|
|||||
Long Term Debt Incurred
|
1,270
|
|
|
—
|
|
|
568
|
|
|
—
|
|
|
1,838
|
|
|||||
Long Term Debt Paid
|
(655
|
)
|
|
—
|
|
|
(714
|
)
|
|
—
|
|
|
(1,369
|
)
|
|||||
Common Stock Issued
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|||||
Common Stock Repurchased
|
(25
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25
|
)
|
|||||
Common Stock Dividends Paid
|
(25
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25
|
)
|
|||||
Capital Contributions and Loans Incurred
|
30
|
|
|
23
|
|
|
—
|
|
|
(53
|
)
|
|
—
|
|
|||||
Capital Redemptions and Loans Paid
|
(448
|
)
|
|
—
|
|
|
—
|
|
|
448
|
|
|
—
|
|
|||||
Intercompany Dividends Paid
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
10
|
|
|
—
|
|
|||||
Debt Related Costs and Other Transactions
|
12
|
|
|
—
|
|
|
(11
|
)
|
|
—
|
|
|
1
|
|
|||||
Total Cash Flows from Financing Activities
|
168
|
|
|
23
|
|
|
(198
|
)
|
|
405
|
|
|
398
|
|
|||||
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash
|
—
|
|
|
—
|
|
|
20
|
|
|
—
|
|
|
20
|
|
|||||
Net Change in Cash, Cash Equivalents and Restricted Cash
|
(48
|
)
|
|
(30
|
)
|
|
(60
|
)
|
|
—
|
|
|
(138
|
)
|
|||||
Cash, Cash Equivalents and Restricted Cash at Beginning of the Period
|
210
|
|
|
55
|
|
|
924
|
|
|
—
|
|
|
1,189
|
|
|||||
Cash, Cash Equivalents and Restricted Cash at End of the Period
|
$
|
162
|
|
|
$
|
25
|
|
|
$
|
864
|
|
|
$
|
—
|
|
|
$
|
1,051
|
|
|
Three Months Ended March 31,
|
|
|||||||||||||
|
|
|
|
|
|
|
Percent
|
|
|||||||
(In millions)
|
2018
|
|
2017
|
|
Change
|
|
Change
|
|
|||||||
Tire Units
|
7.6
|
|
|
7.3
|
|
|
0.3
|
|
|
4.5
|
%
|
|
|||
Net Sales
|
$
|
571
|
|
|
$
|
502
|
|
|
$
|
69
|
|
|
13.7
|
%
|
|
Operating Income
|
76
|
|
|
73
|
|
|
3
|
|
|
4.1
|
%
|
|
|||
Operating Margin
|
13.3
|
%
|
|
14.5
|
%
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
||||
(In millions)
|
2018
|
|
2017
|
||||
First lien revolving credit facility
|
$
|
1,397
|
|
|
$
|
1,667
|
|
European revolving credit facility
|
277
|
|
|
659
|
|
||
Chinese credit facilities
|
136
|
|
|
217
|
|
||
Other foreign and domestic debt
|
301
|
|
|
298
|
|
||
Notes payable and overdrafts
|
328
|
|
|
355
|
|
||
|
$
|
2,439
|
|
|
$
|
3,196
|
|
•
|
We become subject to the financial covenant contained in our first lien revolving credit facility when the aggregate amount of our Parent Company (The Goodyear Tire & Rubber Company) and guarantor subsidiaries cash and cash equivalents (“Available Cash”) plus our availability under our first lien revolving credit facility is less than $200 million. If this were to occur, our ratio of EBITDA to Consolidated Interest Expense may not be less than 2.0 to 1.0 for the most recent period of four consecutive fiscal quarters. As of
March 31, 2018
, our availability under this facility of
$1,397 million
, plus our Available Cash of
$151 million
, totaled
$1,548 million
, which is in excess of $200 million.
|
•
|
We become subject to a covenant contained in our second lien credit facility upon certain asset sales. The covenant provides that, before we use cash proceeds from certain asset sales to repay any junior lien, senior unsecured or subordinated indebtedness, we must first offer to use such cash proceeds to prepay borrowings under the second lien credit facility unless our ratio of Consolidated Net Secured Indebtedness to EBITDA (Pro Forma Senior Secured Leverage Ratio) for any period of four consecutive fiscal quarters is equal to or less than 3.0 to 1.0.
|
•
|
if we do not successfully implement our strategic initiatives, our operating results, financial condition and liquidity may be materially adversely affected;
|
•
|
we face significant global competition and our market share could decline;
|
•
|
deteriorating economic conditions in any of our major markets, or an inability to access capital markets or third-party financing when necessary, may materially adversely affect our operating results, financial condition and liquidity;
|
•
|
raw material and energy costs may materially adversely affect our operating results and financial condition;
|
•
|
if we experience a labor strike, work stoppage or other similar event our business, results of operations, financial condition and liquidity could be materially adversely affected;
|
•
|
we could be negatively impacted by the imposition of tariffs on tires and other goods;
|
•
|
our international operations have certain risks that may materially adversely affect our operating results, financial condition and liquidity;
|
•
|
we have foreign currency translation and transaction risks that may materially adversely affect our operating results, financial condition and liquidity;
|
•
|
our long term ability to meet our obligations, to repay maturing indebtedness or to implement strategic initiatives may be dependent on our ability to access capital markets in the future and to improve our operating results;
|
•
|
financial difficulties, work stoppages, supply disruptions or economic conditions affecting our major customers, dealers or suppliers could harm our business;
|
•
|
our capital expenditures may not be adequate to maintain our competitive position and may not be implemented in a timely or cost-effective manner;
|
•
|
we have a substantial amount of debt, which could restrict our growth, place us at a competitive disadvantage or otherwise materially adversely affect our financial health;
|
•
|
any failure to be in compliance with any material provision or covenant of our debt instruments, or a material reduction in the borrowing base under our revolving credit facility, could have a material adverse effect on our liquidity and operations;
|
•
|
our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly;
|
•
|
we have substantial fixed costs and, as a result, our operating income fluctuates disproportionately with changes in our net sales;
|
•
|
we may incur significant costs in connection with our contingent liabilities and tax matters;
|
•
|
our reserves for contingent liabilities and our recorded insurance assets are subject to various uncertainties, the outcome of which may result in our actual costs being significantly higher than the amounts recorded;
|
•
|
we are subject to extensive government regulations that may materially adversely affect our operating results;
|
•
|
we may be adversely affected by any disruption in, or failure of, our information technology systems due to computer viruses, unauthorized access, cyber-attack, natural disasters or other similar disruptions;
|
•
|
if we are unable to attract and retain key personnel, our business could be materially adversely affected; and
|
•
|
we may be impacted by economic and supply disruptions associated with events beyond our control, such as war, acts of terror, political unrest, public health concerns, labor disputes or natural disasters.
|
|
|
Total Number of
Shares Purchased
(1)
|
|
Average Price Paid
Per Share
|
|
Total Number of
Shares Purchased as
Part of Publicly
Announced Plans or
Programs
|
|
Approximate Dollar Value
of Shares that May
Yet Be Purchased
Under the Plans or
Programs
(2)
|
||||||
Period
|
|
|
|
|
||||||||||
1/1/18-1/31/18
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
786,490,900
|
|
2/1/18-2/28/18
|
|
246,116
|
|
|
29.54
|
|
|
246,116
|
|
|
779,220,991
|
|
||
3/1/18-3/31/18
|
|
628,562
|
|
|
28.20
|
|
|
628,562
|
|
|
761,495,838
|
|
||
Total
|
|
874,678
|
|
|
$
|
28.58
|
|
|
874,678
|
|
|
$
|
761,495,838
|
|
(1)
|
Total number of shares purchased as part of our common stock repurchase program and delivered to us by employees as payment for the exercise price of stock options and the withholding taxes due upon the exercise of stock options or the vesting or payment of stock awards.
|
(2)
|
On September 18, 2013, the Board of Directors authorized $100 million for use in our common stock repurchase program. From time to time, the Board of Directors has approved increases in the amount authorized to be purchased under that program. On February 2, 2017, the Board of Directors approved a further increase in that authorization to an aggregate of
$2.1 billion
. This program expires on December 31, 2019. We intend to repurchase shares of common stock in open market transactions in order to offset new shares issued under equity compensation programs and to provide for additional shareholder returns. During the
three
month period ended
March 31, 2018
, we repurchased
874,678
shares at an average price, including commissions, of
$28.58
per share, or
$25 million
in the aggregate.
|
Exhibit
|
|
|
|
|
Table
|
|
|
|
|
Item
|
|
|
|
Exhibit
|
No.
|
|
Description of Exhibit
|
|
Number
|
|
|
|
|
|
10
|
|
Material Contracts
|
|
|
|
|
|
|
|
(a)
|
|
|
10.1
|
|
|
|
|
|
|
|
|
|
|
|
12
|
|
Statement re Computation of Ratios
|
|
|
|
|
|
|
|
(a)
|
|
|
12.1
|
|
|
|
|
|
|
31
|
|
302 Certifications
|
|
|
|
|
|
|
|
(a)
|
|
|
31.1
|
|
|
|
|
|
|
(b)
|
|
|
31.2
|
|
|
|
|
|
|
32
|
|
906 Certifications
|
|
|
|
|
|
|
|
(a)
|
|
|
32.1
|
|
|
|
|
|
|
101
|
|
Interactive Data File
|
|
|
|
|
|
|
|
(a)
|
|
The following materials from the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2018, formatted in XBRL: (i) the Consolidated Statements of Operations, (ii) the Consolidated Statements of Comprehensive Income, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statements of Cash Flows and (v) the Notes to Consolidated Financial Statements.
|
|
101
|
|
|
THE GOODYEAR TIRE & RUBBER COMPANY
|
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
Date:
|
April 25, 2018
|
By
|
/s/ E
VAN
M. S
COCOS
|
|
|
|
Evan M. Scocos, Vice President and Controller (Signing on behalf of the Registrant as a duly authorized officer of the Registrant and signing as the principal accounting officer of the Registrant.)
|
|
1 Year Goodyear Tire and Rubber Chart |
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