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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Tenneco Inc | NYSE:TEN | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 19.99 | 0 | 01:00:00 |
☑
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Title of each class
|
Trading Symbol
|
Name of each exchange on which registered
|
Class A Voting Common Stock, par value $0.01 per share
|
TEN
|
New York Stock Exchange
|
Preferred Stock Purchase Rights
|
|
New York Stock Exchange
|
Large accelerated filer
|
☑
|
|
Accelerated filer
|
☐
|
Non-accelerated filer
|
☐
|
|
Smaller reporting company
|
☐
|
|
|
|
Emerging growth company
|
☐
|
|
|
Page
|
Part I — Financial Information
|
|
|
Item 1.
|
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Item 2.
|
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Item 3.
|
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Item 4.
|
||
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Part II — Other Information
|
|
|
Item 1.
|
||
Item 1A.
|
||
Item 2.
|
||
Item 3.
|
Defaults Upon Senior Securities
|
*
|
Item 4.
|
Mine Safety Disclosures
|
*
|
Item 5.
|
Other Information
|
*
|
Item 6.
|
*
|
No response to this item is included herein for the reason that it is inapplicable or the answer to such item is negative.
|
•
|
general economic, business and market conditions, including the effects of the COVID-19 pandemic;
|
•
|
disasters, local and global public health emergencies or other catastrophic events, such as fires, earthquakes and flooding, pandemics or epidemics (including the COVID-19 pandemic), where we or other customers do business and any resultant disruptions in the supply or production of goods or services to us or by us in demand by our customers or in the operation of our system, disaster recovery capabilities or business continuity capabilities;
|
•
|
our ability (or inability) to successfully execute cost reduction, performance improvement and other plans, including our plans to respond to the COVID-19 pandemic and our previously announced accelerated performance improvement plan ("Accelerate"), and to realize the anticipated benefits from these plans;
|
•
|
changes in capital availability or costs, including increases in our cost of borrowing (i.e., interest rate increases), the amount of our debt, our ability to access capital markets at favorable rates, and the credit ratings of our debt and our financial flexibility to respond to the COVID-19 pandemic;
|
•
|
our ability to maintain compliance with the agreements governing our indebtedness and otherwise have sufficient liquidity through the COVID-19 pandemic;
|
•
|
our ability to comply with the covenants contained in our debt instruments;
|
•
|
our working capital requirements;
|
•
|
our ability to source and procure needed materials, components and other products, and services in accordance with customer demand and at competitive prices;
|
•
|
the cost and outcome of existing and any future claims, legal proceedings or investigations, including, but not limited to, any of the foregoing arising in connection with the ongoing global antitrust investigation, product performance, product safety or intellectual property rights;
|
•
|
changes in consumer demand for our original equipment ("OE") products or aftermarket products, prices and our ability to have our products included on top selling vehicles, including any shifts in consumer preferences away from historically higher margin products for our customers and us, to other lower margin vehicles, for which we may or may not have supply arrangements;
|
•
|
the cyclical nature of the global vehicle industry, including the performance of the global aftermarket sector and the impact of vehicle parts' longer product lives;
|
•
|
changes in automotive and commercial vehicle manufacturers' production rates and their actual and forecasted requirements for our products, due to difficult economic conditions and/or regulatory or legal changes affecting internal combustion engines and/or aftermarket products;
|
•
|
our dependence on certain large customers, including the loss of any of our large OE manufacturer customers (on whom we depend for a substantial portion of our revenues), or the loss of market shares by these customers if we are unable to achieve increased sales to other OE-customers or any change in customer demand due to delays in the adoption or enforcement of worldwide emissions regulations;
|
•
|
new technologies that reduce the demand for certain of our products or otherwise render them obsolete;
|
•
|
our ability to introduce new products and technologies that satisfy customers' needs in a timely fashion;
|
•
|
the overall highly competitive nature of the automotive and commercial vehicle parts industries, and any resultant inability to realize the sales represented by our awarded book of business (which is based on anticipated pricing and volumes over the life of the applicable program);
|
•
|
risks inherent in operating a multi-national company, including economic conditions, such as currency exchange and inflation rates, political conditions in the countries where we operate or sell our products, adverse changes in trade agreements, tariffs, immigration policies, political stability, tax and other laws, and potential disruptions of production and supply;
|
•
|
increasing competition from lower cost, private-label products;
|
•
|
damage to the reputation of one or more of our leading brands;
|
•
|
the impact of improvements in automotive parts on aftermarket demand for some of our products;
|
•
|
industry-wide strikes, labor disruptions at our facilities or any labor or other economic disruptions at any of our significant customers or suppliers or any of our customers’ other suppliers;
|
•
|
developments relating to our intellectual property, including our ability to adapt to changes in technology and the availability and effectiveness of legal protection for our innovations and brands;
|
•
|
costs related to product warranties and other customer satisfaction actions;
|
•
|
the failure or breach of our information technology systems, including the consequences of any misappropriation, exposure or corruption of sensitive information stored on such systems and the interruption to our business that such failure or breach may cause;
|
•
|
the impact of consolidation among vehicle parts suppliers and customers on our ability to compete in the highly competitive automotive and commercial vehicle supplier industry;
|
•
|
changes in distribution channels or competitive conditions in the markets and countries where we operate;
|
•
|
the evolution towards autonomous vehicles, and car and ride sharing;
|
•
|
customer acceptance of new products;
|
•
|
our ability to successfully integrate, and benefit from, any acquisitions we complete;
|
•
|
our ability to effectively manage our joint ventures and other third-party relationships;
|
•
|
the potential impairment in the carrying value of our long-lived assets, goodwill, and other intangible assets or the inability to fully realize our deferred tax assets;
|
•
|
the negative impact of fuel price volatility on transportation and logistics costs, raw material costs, discretionary purchases of vehicles or aftermarket products, and demand for off-highway equipment;
|
•
|
increases in the costs of raw materials or components, including our ability to successfully reduce the impact of any such cost increases through materials substitutions, cost reduction initiatives, customer recovery, and other methods;
|
•
|
changes by the Financial Accounting Standards Board ("FASB") or the Securities and Exchange Commission ("SEC") of generally accepted accounting principles or other authoritative guidance;
|
•
|
changes in accounting estimates and assumptions, including changes based on additional information;
|
•
|
any changes by the International Organization for Standardization ("ISO") or other such committees in their certification protocols for processes and products, which may have the effect of delaying or hindering our ability to bring new products to market;
|
•
|
the impact of the extensive, increasing, and changing laws and regulations to which we are subject, including environmental laws and regulations, which may result in our incurrence of environmental liabilities in excess of the amount reserved or increased costs or loss of revenues relating to products subject to changing regulation;
|
•
|
potential volatility in our effective tax rate;
|
•
|
acts of war and/or terrorism, as well as actions taken or to be taken by the United States and other governments as a result of further acts or threats of terrorism, and the impact of these acts on economic, financial, and social conditions in the countries where we operate;
|
•
|
pension obligations and other postretirement benefits;
|
•
|
our hedging activities to address commodity price fluctuations; and
|
•
|
the timing and occurrence (or non-occurrence) of other transactions, events and circumstances which may be beyond our control.
|
•
|
the ability to identify and consummate strategic alternatives that yield additional value for shareholders;
|
•
|
the timing, benefits, and outcome of the Company's strategic review process;
|
•
|
the structure, terms, and specific risk and uncertainties associated with any potential strategic alternative;
|
•
|
potential disruptions in our business and stock price as a result of our exploration, review, and pursuit of any strategic alternatives;
|
•
|
the possibility that the Company may not complete a separation of the aftermarket and ride performance business from the powertrain technology business (or achieve some or all of the anticipated benefits of such a separation);
|
•
|
the ability to retain and hire key personnel and maintain relationships with customers, suppliers or other business partners;
|
•
|
the potential diversion of management's attention resulting from a separation;
|
•
|
the risk the combined company and each separate company following a separation will underperform relative to our expectations;
|
•
|
the ongoing transaction costs and risk we may incur greater costs following a separation of the business;
|
•
|
the risk a spin-off is determined to be a taxable transaction;
|
•
|
the risk the benefits of a separation may not be fully realized or may take longer to realize than expected;
|
•
|
the risk a separation may not advance our business strategy; and
|
•
|
the risk a transaction may have an adverse effect on existing arrangements with us, including those related to transition, manufacturing and supply services and tax matters.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Revenues
|
|
|
|
|
|
|
|
||||||||
Net sales and operating revenues
|
$
|
2,637
|
|
|
$
|
4,504
|
|
|
$
|
6,473
|
|
|
$
|
8,988
|
|
|
|
|
|
|
|
|
|
||||||||
Costs and expenses
|
|
|
|
|
|
|
|
||||||||
Cost of sales (exclusive of depreciation and amortization)
|
2,498
|
|
|
3,801
|
|
|
5,837
|
|
|
7,671
|
|
||||
Selling, general, and administrative
|
195
|
|
|
292
|
|
|
444
|
|
|
610
|
|
||||
Depreciation and amortization
|
159
|
|
|
169
|
|
|
330
|
|
|
338
|
|
||||
Engineering, research, and development
|
55
|
|
|
78
|
|
|
132
|
|
|
170
|
|
||||
Restructuring charges, net and asset impairments
|
121
|
|
|
49
|
|
|
605
|
|
|
65
|
|
||||
Goodwill and intangible impairment charges
|
—
|
|
|
—
|
|
|
383
|
|
|
60
|
|
||||
|
3,028
|
|
|
4,389
|
|
|
7,731
|
|
|
8,914
|
|
||||
Other income (expense)
|
|
|
|
|
|
|
|
||||||||
Non-service pension and other postretirement benefit (costs) credits
|
1
|
|
|
(4
|
)
|
|
2
|
|
|
(6
|
)
|
||||
Equity in earnings (losses) of nonconsolidated affiliates, net of tax
|
4
|
|
|
17
|
|
|
17
|
|
|
33
|
|
||||
Other income (expense), net
|
11
|
|
|
13
|
|
|
19
|
|
|
16
|
|
||||
|
16
|
|
|
26
|
|
|
38
|
|
|
43
|
|
||||
Earnings (loss) before interest expense, income taxes, and noncontrolling interests
|
(375
|
)
|
|
141
|
|
|
(1,220
|
)
|
|
117
|
|
||||
Interest expense
|
(66
|
)
|
|
(82
|
)
|
|
(141
|
)
|
|
(163
|
)
|
||||
Earnings (loss) before income taxes and noncontrolling interests
|
(441
|
)
|
|
59
|
|
|
(1,361
|
)
|
|
(46
|
)
|
||||
Income tax (expense) benefit
|
101
|
|
|
(14
|
)
|
|
195
|
|
|
(14
|
)
|
||||
Net income (loss)
|
(340
|
)
|
|
45
|
|
|
(1,166
|
)
|
|
(60
|
)
|
||||
Less: Net income (loss) attributable to noncontrolling interests
|
10
|
|
|
19
|
|
|
23
|
|
|
31
|
|
||||
Net income (loss) attributable to Tenneco Inc.
|
$
|
(350
|
)
|
|
$
|
26
|
|
|
$
|
(1,189
|
)
|
|
$
|
(91
|
)
|
Earnings (loss) per share
|
|
|
|
|
|
|
|
||||||||
Basic earnings (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share
|
$
|
(4.30
|
)
|
|
$
|
0.32
|
|
|
$
|
(14.64
|
)
|
|
$
|
(1.13
|
)
|
Weighted average shares outstanding
|
81,350,773
|
|
|
80,920,825
|
|
|
81,259,667
|
|
|
80,897,731
|
|
||||
Diluted earnings (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share
|
$
|
(4.30
|
)
|
|
$
|
0.32
|
|
|
$
|
(14.64
|
)
|
|
$
|
(1.13
|
)
|
Weighted average shares outstanding
|
81,350,773
|
|
|
80,920,825
|
|
|
81,259,667
|
|
|
80,897,731
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Net income (loss)
|
$
|
(340
|
)
|
|
$
|
45
|
|
|
$
|
(1,166
|
)
|
|
$
|
(60
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustment
|
42
|
|
|
(18
|
)
|
|
(177
|
)
|
|
17
|
|
||||
Cash flow hedges
|
4
|
|
|
(3
|
)
|
|
2
|
|
|
1
|
|
||||
Defined benefit plans
|
(5
|
)
|
|
(2
|
)
|
|
(1
|
)
|
|
(1
|
)
|
||||
|
41
|
|
|
(23
|
)
|
|
(176
|
)
|
|
17
|
|
||||
Comprehensive income (loss)
|
(299
|
)
|
|
22
|
|
|
(1,342
|
)
|
|
(43
|
)
|
||||
Less: Comprehensive income (loss) attributable to noncontrolling interests
|
17
|
|
|
18
|
|
|
10
|
|
|
36
|
|
||||
Comprehensive income (loss) attributable to common shareholders
|
$
|
(316
|
)
|
|
$
|
4
|
|
|
$
|
(1,352
|
)
|
|
$
|
(79
|
)
|
|
June 30,
2020 |
|
December 31,
2019 |
||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,362
|
|
|
$
|
564
|
|
Restricted cash
|
9
|
|
|
2
|
|
||
Receivables:
|
|
|
|
||||
Customer notes and accounts, net
|
2,100
|
|
|
2,438
|
|
||
Other
|
85
|
|
|
100
|
|
||
Inventories
|
1,656
|
|
|
1,999
|
|
||
Prepayments and other current assets
|
632
|
|
|
632
|
|
||
Total current assets
|
5,844
|
|
|
5,735
|
|
||
Property, plant, and equipment, net
|
2,939
|
|
|
3,627
|
|
||
Long-term receivables, net
|
10
|
|
|
10
|
|
||
Goodwill
|
505
|
|
|
775
|
|
||
Intangibles, net
|
1,239
|
|
|
1,422
|
|
||
Investments in nonconsolidated affiliates
|
513
|
|
|
518
|
|
||
Deferred income taxes
|
818
|
|
|
607
|
|
||
Other assets
|
527
|
|
|
532
|
|
||
Total assets
|
$
|
12,395
|
|
|
$
|
13,226
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|||||||
Current liabilities:
|
|
|
|
||||
Short-term debt, including current maturities of long-term debt
|
$
|
222
|
|
|
$
|
185
|
|
Accounts payable
|
1,992
|
|
|
2,647
|
|
||
Accrued compensation and employee benefits
|
331
|
|
|
325
|
|
||
Accrued income taxes
|
48
|
|
|
72
|
|
||
Accrued expenses and other current liabilities
|
1,043
|
|
|
1,070
|
|
||
Total current liabilities
|
3,636
|
|
|
4,299
|
|
||
Long-term debt
|
6,629
|
|
|
5,371
|
|
||
Deferred income taxes
|
88
|
|
|
106
|
|
||
Pension and postretirement benefits
|
1,112
|
|
|
1,145
|
|
||
Deferred credits and other liabilities
|
502
|
|
|
490
|
|
||
Commitments and contingencies (Note 13)
|
|
|
|
|
|
||
Total liabilities
|
11,967
|
|
|
11,411
|
|
||
Redeemable noncontrolling interests
|
79
|
|
|
196
|
|
||
Tenneco Inc. shareholders’ equity:
|
|
|
|
||||
Preferred stock — $0.01 par value; none issued
|
—
|
|
|
—
|
|
||
Class A voting stock — $0.01 par value; shares issued: June 30, 2020 — 75,546,691 and December 31, 2019 — 71,727,061
|
1
|
|
|
1
|
|
||
Class B non-voting convertible stock — $0.01 par value; shares issued: June 30, 2020 — 20,308,454 and December 31, 2019 — 23,793,669
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
4,433
|
|
|
4,432
|
|
||
Accumulated other comprehensive loss
|
(874
|
)
|
|
(711
|
)
|
||
Accumulated deficit
|
(2,556
|
)
|
|
(1,367
|
)
|
||
|
1,004
|
|
|
2,355
|
|
||
Shares held as treasury stock — at cost: June 30, 2020 and December 31, 2019 — 14,592,888
|
(930
|
)
|
|
(930
|
)
|
||
Total Tenneco Inc. shareholders’ equity
|
74
|
|
|
1,425
|
|
||
Noncontrolling interests
|
275
|
|
|
194
|
|
||
Total equity
|
349
|
|
|
1,619
|
|
||
Total liabilities, redeemable noncontrolling interests and equity
|
$
|
12,395
|
|
|
$
|
13,226
|
|
|
Six Months Ended June 30,
|
||||||
|
2020
|
|
2019
|
||||
Operating Activities
|
|
|
|
||||
Net income (loss)
|
$
|
(1,166
|
)
|
|
$
|
(60
|
)
|
Adjustments to reconcile net income (loss) to cash (used) provided by operating activities:
|
|
|
|
||||
Goodwill and intangible impairment charges
|
383
|
|
|
60
|
|
||
Depreciation and amortization
|
330
|
|
|
338
|
|
||
Deferred income taxes
|
(242
|
)
|
|
(14
|
)
|
||
Stock-based compensation
|
9
|
|
|
13
|
|
||
Restructuring charges and asset impairments, net of cash paid
|
540
|
|
|
14
|
|
||
Change in pension and other postretirement benefit plans
|
(26
|
)
|
|
(32
|
)
|
||
Equity in earnings of nonconsolidated affiliates
|
(17
|
)
|
|
(33
|
)
|
||
Cash dividends received from nonconsolidated affiliates
|
18
|
|
|
27
|
|
||
Loss (gain) on sale of assets
|
(1
|
)
|
|
(1
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Receivables
|
174
|
|
|
(401
|
)
|
||
Inventories
|
292
|
|
|
101
|
|
||
Payables and accrued expenses
|
(540
|
)
|
|
48
|
|
||
Accrued interest and accrued income taxes
|
(17
|
)
|
|
(66
|
)
|
||
Other assets and liabilities
|
(68
|
)
|
|
(94
|
)
|
||
Net cash (used) provided by operating activities
|
(331
|
)
|
|
(100
|
)
|
||
Investing Activities
|
|
|
|
||||
Acquisitions, net of cash acquired
|
—
|
|
|
(158
|
)
|
||
Proceeds from sale of assets
|
5
|
|
|
5
|
|
||
Net proceeds from sale of business
|
—
|
|
|
22
|
|
||
Cash payments for property, plant, and equipment
|
(212
|
)
|
|
(379
|
)
|
||
Proceeds from deferred purchase price of factored receivables
|
91
|
|
|
147
|
|
||
Other
|
1
|
|
|
(1
|
)
|
||
Net cash (used) provided by investing activities
|
(115
|
)
|
|
(364
|
)
|
||
Financing Activities
|
|
|
|
||||
Proceeds from term loans and notes
|
96
|
|
|
111
|
|
||
Repayments of term loans and notes
|
(133
|
)
|
|
(190
|
)
|
||
Debt issuance costs of long-term debt
|
(16
|
)
|
|
—
|
|
||
Borrowings on revolving lines of credit
|
4,821
|
|
|
4,525
|
|
||
Payments on revolving lines of credit
|
(3,536
|
)
|
|
(4,254
|
)
|
||
Issuance (repurchase) of common shares
|
(1
|
)
|
|
(2
|
)
|
||
Cash dividends
|
—
|
|
|
(20
|
)
|
||
Net increase (decrease) in bank overdrafts
|
59
|
|
|
(8
|
)
|
||
Other
|
(1
|
)
|
|
(1
|
)
|
||
Distributions to noncontrolling interest partners
|
(2
|
)
|
|
(20
|
)
|
||
Net cash (used) provided by financing activities
|
1,287
|
|
|
141
|
|
||
Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash
|
(36
|
)
|
|
11
|
|
||
Increase (decrease) in cash, cash equivalents, and restricted cash
|
805
|
|
|
(312
|
)
|
||
Cash, cash equivalents, and restricted cash, beginning of period
|
566
|
|
|
702
|
|
||
Cash, cash equivalents, and restricted cash, end of period
|
$
|
1,371
|
|
|
$
|
390
|
|
Supplemental Cash Flow Information
|
|
|
|
||||
Cash paid during the period for interest
|
$
|
123
|
|
|
$
|
145
|
|
Cash paid during the period for income taxes, net of refunds
|
$
|
75
|
|
|
$
|
100
|
|
Lease assets obtained in exchange for new operating lease liabilities
|
$
|
54
|
|
|
$
|
33
|
|
Non-cash inventory charge due to aftermarket product line exit
|
$
|
82
|
|
|
$
|
—
|
|
Non-cash Investing Activities
|
|
|
|
||||
Period end balance of accounts payable for property, plant, and equipment
|
$
|
86
|
|
|
$
|
116
|
|
Deferred purchase price of receivables factored in the period
|
$
|
95
|
|
|
$
|
52
|
|
Reduction in assets from redeemable noncontrolling interest transaction with owner
|
$
|
53
|
|
|
$
|
—
|
|
|
Tenneco Inc. Shareholders' equity
|
|
|
||||||||||||||||||||||||||||
|
$0.01 Par Value Common Stock
|
|
Treasury Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total Tenneco Inc. Shareholders' Equity
|
|
Noncontrolling Interests
|
|
Total Equity
|
||||||||||||||||
Balance at December 31, 2019
|
$
|
1
|
|
|
$
|
(930
|
)
|
|
$
|
4,432
|
|
|
$
|
(1,367
|
)
|
|
$
|
(711
|
)
|
|
$
|
1,425
|
|
|
$
|
194
|
|
|
$
|
1,619
|
|
Net income (loss)
|
|
|
|
|
|
|
(839
|
)
|
|
|
|
(839
|
)
|
|
2
|
|
|
(837
|
)
|
||||||||||||
Other comprehensive income (loss)—net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Foreign currency translation adjustments
|
|
|
|
|
|
|
|
|
(199
|
)
|
|
(199
|
)
|
|
(13
|
)
|
|
(212
|
)
|
||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
(2
|
)
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||||||||||
Defined benefit plans
|
|
|
|
|
|
|
|
|
4
|
|
|
4
|
|
|
—
|
|
|
4
|
|
||||||||||||
Comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
(1,036
|
)
|
|
(11
|
)
|
|
(1,047
|
)
|
|||||||||||||
Stock-based compensation, net
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||||||
Reclassification of redeemable noncontrolling interest to permanent equity
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
82
|
|
|
82
|
|
||||||||
Redeemable noncontrolling interest transaction with owner
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
(7
|
)
|
||||||||
Balance at March 31, 2020
|
1
|
|
|
(930
|
)
|
|
4,427
|
|
|
(2,206
|
)
|
|
(908
|
)
|
|
384
|
|
|
265
|
|
|
649
|
|
||||||||
Net income (loss)
|
|
|
|
|
|
|
(350
|
)
|
|
|
|
(350
|
)
|
|
6
|
|
|
(344
|
)
|
||||||||||||
Other comprehensive income (loss)—net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Foreign currency translation adjustments
|
|
|
|
|
|
|
|
|
35
|
|
|
35
|
|
|
4
|
|
|
39
|
|
||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
4
|
|
|
4
|
|
|
—
|
|
|
4
|
|
||||||||||||
Defined benefit plans
|
|
|
|
|
|
|
|
|
(5
|
)
|
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
||||||||||||
Comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
(316
|
)
|
|
10
|
|
|
(306
|
)
|
|||||||||||||
Stock-based compensation, net
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||||||
Balance as of June 30, 2020
|
$
|
1
|
|
|
$
|
(930
|
)
|
|
$
|
4,433
|
|
|
$
|
(2,556
|
)
|
|
$
|
(874
|
)
|
|
$
|
74
|
|
|
$
|
275
|
|
|
$
|
349
|
|
|
Tenneco Inc. Shareholders' equity
|
|
|
||||||||||||||||||||||||||||
|
$0.01 Par Value Common Stock
|
|
Treasury Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total Tenneco Inc. Shareholders' Equity
|
|
Noncontrolling Interests
|
|
Total Equity
|
||||||||||||||||
Balance at December 31, 2018
|
$
|
1
|
|
|
$
|
(930
|
)
|
|
$
|
4,360
|
|
|
$
|
(1,013
|
)
|
|
$
|
(692
|
)
|
|
$
|
1,726
|
|
|
$
|
190
|
|
|
$
|
1,916
|
|
Net income (loss)
|
|
|
|
|
|
|
(117
|
)
|
|
|
|
(117
|
)
|
|
7
|
|
|
(110
|
)
|
||||||||||||
Other comprehensive income (loss)—net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Foreign currency translation adjustments
|
|
|
|
|
|
|
|
|
29
|
|
|
29
|
|
|
4
|
|
|
33
|
|
||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
4
|
|
|
4
|
|
|
—
|
|
|
4
|
|
||||||||||||
Defined benefit plans
|
|
|
|
|
|
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||||||||||
Comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
(83
|
)
|
|
11
|
|
|
(72
|
)
|
|||||||||||||
Stock-based compensation, net
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
||||||||
Cash dividends ($0.25 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(20
|
)
|
|
—
|
|
|
(20
|
)
|
|
—
|
|
|
(20
|
)
|
||||||||
Purchase accounting measurement period adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||||||
Distributions declared to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||||||
Balance at March 31, 2019
|
1
|
|
|
(930
|
)
|
|
4,365
|
|
|
(1,150
|
)
|
|
(658
|
)
|
|
1,628
|
|
|
199
|
|
|
1,827
|
|
||||||||
Net income (loss)
|
|
|
|
|
|
|
26
|
|
|
|
|
26
|
|
|
9
|
|
|
35
|
|
||||||||||||
Other comprehensive income (loss)—net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Foreign currency translation adjustments
|
|
|
|
|
|
|
|
|
(17
|
)
|
|
(17
|
)
|
|
—
|
|
|
(17
|
)
|
||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
(3
|
)
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
||||||||||||
Defined benefit plans
|
|
|
|
|
|
|
|
|
(2
|
)
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||||||||||
Comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
4
|
|
|
9
|
|
|
13
|
|
|||||||||||||
Stock-based compensation, net
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||||||
Distributions declared to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
||||||||
Balance at June 30, 2019
|
$
|
1
|
|
|
$
|
(930
|
)
|
|
$
|
4,371
|
|
|
$
|
(1,124
|
)
|
|
$
|
(680
|
)
|
|
$
|
1,638
|
|
|
$
|
206
|
|
|
$
|
1,844
|
|
•
|
During the first quarter of 2020, the Company completed the process to make a tender offer of the shares it did not own for a subsidiary in India acquired by the Company as part of the Federal-Mogul Acquisition on October 1, 2018, in accordance with local regulations. As a result of completing the tender offer, the redeemable noncontrolling interest was no longer redeemable or probable of becoming redeemable and the amount of $82 million was reclassified to permanent equity during the six months ended June 30, 2020. Refer to Note 17, Related Party Transactions, for additional information related to the tender offer of this noncontrolling interest; and
|
•
|
A 9.5% ownership interest in Öhlins Intressenter AB (the “KÖ Interest”) was retained by K Öhlin Holding AB (“Köhlin”), as a result of the Öhlins acquisition on January 10, 2019. Köhlin has an irrevocable right at any time after the third anniversary of the Öhlins acquisition to sell the KÖ Interest to the Company. Since it is probable the KÖ Interest will become redeemable, the Company recognized the change in carrying value and recorded an adjustment of $10 million during the six months ended June 30, 2020 to reflect its redemption value of $29 million at June 30, 2020.
|
|
Six Months Ended June 30,
|
||||||
|
2020
|
|
2019
|
||||
Balance at beginning of period
|
$
|
196
|
|
|
$
|
138
|
|
Net income (loss) attributable to redeemable noncontrolling interests
|
5
|
|
|
15
|
|
||
Other comprehensive income (loss)
|
(4
|
)
|
|
1
|
|
||
Acquisition and other
|
—
|
|
|
16
|
|
||
Noncontrolling interest tender offer redemption
|
(46
|
)
|
|
—
|
|
||
Redemption value measurement adjustment
|
10
|
|
|
—
|
|
||
Purchase accounting measurement period adjustment
|
—
|
|
|
(8
|
)
|
||
Reclassification of noncontrolling interest to permanent equity
|
(82
|
)
|
|
—
|
|
||
Dividends declared
|
—
|
|
|
(17
|
)
|
||
Balance at end of period
|
$
|
79
|
|
|
$
|
145
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||
Weighted average shares of common stock outstanding
|
81,350,773
|
|
|
80,920,825
|
|
|
81,259,667
|
|
|
80,897,731
|
|
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||
Restricted stock, PSUs, and RSUs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Stock options
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Dilutive shares outstanding
|
81,350,773
|
|
|
80,920,825
|
|
|
81,259,667
|
|
|
80,897,731
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Assets
|
|
|
|
||||
Receivables
|
$
|
3
|
|
|
$
|
5
|
|
Inventories
|
7
|
|
|
8
|
|
||
Other current assets
|
2
|
|
|
1
|
|
||
Long-lived assets
|
16
|
|
|
18
|
|
||
Goodwill
|
3
|
|
|
4
|
|
||
Impairment on carrying value
|
(7
|
)
|
|
(8
|
)
|
||
Total assets held for sale
|
$
|
24
|
|
|
$
|
28
|
|
Liabilities
|
|
|
|
||||
Accounts payable
|
$
|
2
|
|
|
$
|
4
|
|
Accrued liabilities
|
2
|
|
|
2
|
|
||
Total liabilities held for sale
|
$
|
4
|
|
|
$
|
6
|
|
|
Three Months Ended June 30, 2020
|
||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Corporate
|
|
Total
|
||||||||||||
Severance and other charges, net
|
$
|
22
|
|
|
$
|
36
|
|
|
$
|
18
|
|
|
$
|
15
|
|
|
$
|
1
|
|
|
$
|
92
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset impairments related to restructuring actions
|
—
|
|
|
3
|
|
|
—
|
|
|
25
|
|
|
—
|
|
|
28
|
|
||||||
Other non-restructuring asset impairments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
||||||
Impairment of assets held for sale
|
—
|
|
|
1
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
||||||
Total asset impairment charges
|
—
|
|
|
4
|
|
|
—
|
|
|
24
|
|
|
1
|
|
|
29
|
|
||||||
Total restructuring charges, net and asset impairments
|
$
|
22
|
|
|
$
|
40
|
|
|
$
|
18
|
|
|
$
|
39
|
|
|
$
|
2
|
|
|
$
|
121
|
|
|
Three Months Ended June 30, 2019
|
||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Corporate
|
|
Total
|
||||||||||||
Severance and other charges, net
|
$
|
14
|
|
|
$
|
17
|
|
|
$
|
10
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
47
|
|
Other non-restructuring asset impairments
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
2
|
|
||||||
Total restructuring charges, net and asset impairments
|
$
|
15
|
|
|
$
|
17
|
|
|
$
|
10
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
49
|
|
|
Six Months Ended June 30, 2020
|
||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Corporate
|
|
Total
|
||||||||||||
Severance and other charges, net
|
$
|
22
|
|
|
$
|
37
|
|
|
$
|
24
|
|
|
$
|
17
|
|
|
$
|
5
|
|
|
$
|
105
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset impairments related to restructuring actions
|
—
|
|
|
3
|
|
|
—
|
|
|
25
|
|
|
—
|
|
|
28
|
|
||||||
Other non-restructuring asset impairments
|
—
|
|
|
—
|
|
|
455
|
|
|
—
|
|
|
17
|
|
|
472
|
|
||||||
Impairment of assets held for sale
|
—
|
|
|
1
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
||||||
Total asset impairment charges
|
—
|
|
|
4
|
|
|
455
|
|
|
24
|
|
|
17
|
|
|
500
|
|
||||||
Total restructuring charges, net and asset impairments
|
$
|
22
|
|
|
$
|
41
|
|
|
$
|
479
|
|
|
$
|
41
|
|
|
$
|
22
|
|
|
$
|
605
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Corporate
|
|
Total
|
||||||||||||
Severance and other charges, net
|
$
|
19
|
|
|
$
|
18
|
|
|
$
|
15
|
|
|
$
|
10
|
|
|
$
|
1
|
|
|
$
|
63
|
|
Other non-restructuring asset impairments
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
2
|
|
||||||
Total restructuring charges, net and asset impairments
|
$
|
20
|
|
|
$
|
18
|
|
|
$
|
15
|
|
|
$
|
11
|
|
|
$
|
1
|
|
|
$
|
65
|
|
•
|
In conjunction with the Company's previously announced Project Accelerate, and in response to the COVID-19 global pandemic, the Company is executing global headcount reductions, subject to negotiation with works councils in certain jurisdictions. The Company began implementing these actions during the second quarter of 2020 and expects to complete them during 2021. During the three and six months ended June 30, 2020, the Company recognized a charge of $25 million in connection with the cash severance costs expected to be paid in connections with these actions.
|
•
|
In addition to the actions above, the Company initiated several other cost reduction initiatives across all segments and regions aimed at optimizing the Company's cost structure. During the three and six months ended June 30, 2020, the Company recognized cash severance charges of $32 million expected to be paid under these programs.
|
•
|
During the three and six months ended June 30, 2020, the Powertrain segment incurred $20 million in restructuring and other costs, of which $16 million is related to plant relocations and closures, and $4 million is related to a cost reduction program in one of its product lines.
|
•
|
During the three and six months ended June 30, 2020, the Company incurred $4 million and $10 million in restructuring and other costs related to previously announced plant relocation and closures within its Ride Performance segment.
|
•
|
Beginning in the third quarter of 2020, the Motorparts segment will initiate a rationalization of its supply chain and distribution network to achieve supply chain efficiencies and improve throughput to its customers; as discussed in Note 1, Description of Business. During the three and six months ended June 30, 2020, the Motorparts segment recognized $4 million in restructuring charges related to cash severance expected to be paid in connection with these actions. In addition, the Motorparts segment also recognized charges during the three and six months ended June 30, 2020 of $3 million in connection with an infrastructure cost reduction program in one of its regions.
|
•
|
The Company also incurred $4 million in cash severance costs for the elimination of certain redundant positions within its corporate component in the six months ended June 30, 2020.
|
|
Reportable Segments
|
|
|
|
|
||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total Reportable Segments
|
|
Corporate
|
|
Total
|
||||||||||||||
Balance at December 31, 2019
|
$
|
23
|
|
|
$
|
30
|
|
|
$
|
23
|
|
|
$
|
16
|
|
|
$
|
92
|
|
|
$
|
9
|
|
|
$
|
101
|
|
Provisions
|
—
|
|
|
2
|
|
|
7
|
|
|
2
|
|
|
11
|
|
|
4
|
|
|
15
|
|
|||||||
Revisions to estimates
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|||||||
Payments
|
(4
|
)
|
|
(4
|
)
|
|
(9
|
)
|
|
(4
|
)
|
|
(21
|
)
|
|
(9
|
)
|
|
(30
|
)
|
|||||||
Foreign currency
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||||
Balance at March 31, 2020
|
19
|
|
|
27
|
|
|
19
|
|
|
14
|
|
|
79
|
|
|
4
|
|
|
83
|
|
|||||||
Provisions
|
24
|
|
|
36
|
|
|
18
|
|
|
17
|
|
|
95
|
|
|
1
|
|
|
96
|
|
|||||||
Revisions to estimates
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|||||||
Payments
|
(6
|
)
|
|
(6
|
)
|
|
(17
|
)
|
|
(5
|
)
|
|
(34
|
)
|
|
(1
|
)
|
|
(35
|
)
|
|||||||
Balance at June 30, 2020
|
$
|
35
|
|
|
$
|
57
|
|
|
$
|
20
|
|
|
$
|
24
|
|
|
$
|
136
|
|
|
$
|
4
|
|
|
$
|
140
|
|
|
Reportable Segments
|
|
|
|
|
||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total Reportable Segments
|
|
Corporate
|
|
Total
|
||||||||||||||
Balance at December 31, 2018
|
$
|
17
|
|
|
$
|
15
|
|
|
$
|
25
|
|
|
$
|
43
|
|
|
$
|
100
|
|
|
$
|
3
|
|
|
$
|
103
|
|
Provisions
|
5
|
|
|
1
|
|
|
5
|
|
|
4
|
|
|
15
|
|
|
1
|
|
|
16
|
|
|||||||
Payments
|
(6
|
)
|
|
(3
|
)
|
|
(5
|
)
|
|
(14
|
)
|
|
(28
|
)
|
|
(2
|
)
|
|
(30
|
)
|
|||||||
Balance at March 31, 2019
|
16
|
|
|
13
|
|
|
25
|
|
|
33
|
|
|
87
|
|
|
2
|
|
|
89
|
|
|||||||
Provisions
|
14
|
|
|
17
|
|
|
10
|
|
|
8
|
|
|
49
|
|
|
—
|
|
|
49
|
|
|||||||
Revisions to estimates
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|||||||
Payments
|
(2
|
)
|
|
(4
|
)
|
|
(7
|
)
|
|
(7
|
)
|
|
(20
|
)
|
|
(1
|
)
|
|
(21
|
)
|
|||||||
Balance at June 30, 2019
|
$
|
28
|
|
|
$
|
26
|
|
|
$
|
28
|
|
|
$
|
32
|
|
|
$
|
114
|
|
|
$
|
1
|
|
|
$
|
115
|
|
|
Six Months Ended June 30, 2020
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||||
|
Employee Costs
|
|
Facility Closure and Other Costs
|
|
Total
|
|
Employee Costs
|
|
Facility Closure and Other Costs
|
|
Total
|
||||||||||||
Balance at beginning of period
|
$
|
97
|
|
|
$
|
4
|
|
|
$
|
101
|
|
|
$
|
98
|
|
|
$
|
5
|
|
|
$
|
103
|
|
Provisions
|
10
|
|
|
5
|
|
|
15
|
|
|
11
|
|
|
5
|
|
|
16
|
|
||||||
Revisions to estimates
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Payments
|
(23
|
)
|
|
(7
|
)
|
|
(30
|
)
|
|
(25
|
)
|
|
(5
|
)
|
|
(30
|
)
|
||||||
Foreign currency
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at March 31
|
81
|
|
|
2
|
|
|
83
|
|
|
84
|
|
|
5
|
|
|
89
|
|
||||||
Provisions
|
90
|
|
|
6
|
|
|
96
|
|
|
44
|
|
|
5
|
|
|
49
|
|
||||||
Revisions to estimates
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||||
Payments
|
(31
|
)
|
|
(4
|
)
|
|
(35
|
)
|
|
(16
|
)
|
|
(5
|
)
|
|
(21
|
)
|
||||||
Balance at end of period
|
$
|
136
|
|
|
$
|
4
|
|
|
$
|
140
|
|
|
$
|
110
|
|
|
$
|
5
|
|
|
$
|
115
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Finished goods
|
$
|
728
|
|
|
$
|
1,027
|
|
Work in process
|
427
|
|
|
460
|
|
||
Raw materials
|
400
|
|
|
408
|
|
||
Materials and supplies
|
101
|
|
|
104
|
|
||
|
$
|
1,656
|
|
|
$
|
1,999
|
|
|
|
Six Months Ended June 30, 2020
|
||||||||||||||
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total
|
||||||||
Goodwill impairment charges
|
|
$
|
160
|
|
|
$
|
37
|
|
|
$
|
70
|
|
|
$
|
267
|
|
Trade names and trademarks intangible asset impairment charges
|
|
—
|
|
|
11
|
|
|
40
|
|
|
51
|
|
||||
Definite-lived intangible asset impairment charges
|
|
—
|
|
|
65
|
|
|
—
|
|
|
65
|
|
||||
|
|
$
|
160
|
|
|
$
|
113
|
|
|
$
|
110
|
|
|
$
|
383
|
|
|
Segments
|
||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
||||||||
Number of reporting units with goodwill
|
3
|
|
|
1
|
|
|
1
|
|
|
1
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Number of reporting units where fair value exceeds carrying value:
|
|
|
|
|
|
|
|
||||||||
Greater than 10%
|
3
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Less than 10%
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Goodwill for reporting units where fair value exceeds carrying value:
|
|
|
|
|
|
|
|
||||||||
Greater than 10%
|
$
|
22
|
|
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
—
|
|
Less than 10%
|
—
|
|
|
165
|
|
|
—
|
|
|
311
|
|
||||
|
$
|
22
|
|
|
$
|
165
|
|
|
$
|
7
|
|
|
$
|
311
|
|
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total
|
||||||||||
Gross carrying amount at December 31, 2019
|
$
|
22
|
|
|
$
|
343
|
|
|
$
|
259
|
|
|
$
|
620
|
|
|
$
|
1,244
|
|
Foreign exchange
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||
Gross carrying amount at March 31, 2020
|
22
|
|
|
343
|
|
|
256
|
|
|
620
|
|
|
1,241
|
|
|||||
Foreign exchange
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
|||||
Gross carrying amount at June 30, 2020
|
22
|
|
|
343
|
|
|
259
|
|
|
620
|
|
|
1,244
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Accumulated impairment loss at December 31, 2019
|
—
|
|
|
(18
|
)
|
|
(212
|
)
|
|
(239
|
)
|
|
(469
|
)
|
|||||
Impairment
|
—
|
|
|
(160
|
)
|
|
(37
|
)
|
|
(70
|
)
|
|
(267
|
)
|
|||||
Accumulated impairment loss at March 31, 2020
|
—
|
|
|
(178
|
)
|
|
(249
|
)
|
|
(309
|
)
|
|
(736
|
)
|
|||||
Foreign exchange
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||
Accumulated impairment loss at June 30, 2020
|
—
|
|
|
(178
|
)
|
|
(252
|
)
|
|
(309
|
)
|
|
(739
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net carrying value at end of period
|
$
|
22
|
|
|
$
|
165
|
|
|
$
|
7
|
|
|
$
|
311
|
|
|
$
|
505
|
|
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||||||||||||||||||
|
Useful Lives
|
|
Gross Carrying Value
|
|
Accumulated Amortization
|
|
Net Carrying Value
|
|
Gross Carrying Value
|
|
Accumulated Amortization
|
|
Net Carrying Value
|
||||||||||||
Definite-lived intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Customer relationships and platforms
|
10 years
|
|
$
|
988
|
|
|
$
|
(233
|
)
|
|
$
|
755
|
|
|
$
|
988
|
|
|
$
|
(123
|
)
|
|
$
|
865
|
|
Customer contract
|
10 years
|
|
8
|
|
|
(6
|
)
|
|
2
|
|
|
8
|
|
|
(6
|
)
|
|
2
|
|
||||||
Patents
|
10 to 17 years
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
||||||
Technology rights
|
10 to 30 years
|
|
133
|
|
|
(44
|
)
|
|
89
|
|
|
133
|
|
|
(37
|
)
|
|
96
|
|
||||||
Packaged kits know-how
|
10 years
|
|
54
|
|
|
(9
|
)
|
|
45
|
|
|
54
|
|
|
(7
|
)
|
|
47
|
|
||||||
Catalogs
|
10 years
|
|
47
|
|
|
(8
|
)
|
|
39
|
|
|
47
|
|
|
(6
|
)
|
|
41
|
|
||||||
Licensing agreements
|
3 to 5 years
|
|
63
|
|
|
(27
|
)
|
|
36
|
|
|
63
|
|
|
(18
|
)
|
|
45
|
|
||||||
Land use rights
|
28 to 46 years
|
|
46
|
|
|
(4
|
)
|
|
42
|
|
|
47
|
|
|
(3
|
)
|
|
44
|
|
||||||
|
|
|
1,340
|
|
|
(332
|
)
|
|
1,008
|
|
|
1,341
|
|
|
(201
|
)
|
|
1,140
|
|
||||||
Indefinite-lived intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trade names and trademarks
|
|
|
|
|
|
|
231
|
|
|
|
|
|
|
282
|
|
||||||||||
Total
|
|
|
|
|
|
|
$
|
1,239
|
|
|
|
|
|
|
$
|
1,422
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Amortization expense
|
|
$
|
32
|
|
|
$
|
33
|
|
|
$
|
66
|
|
|
$
|
68
|
|
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
2025 and thereafter
|
|
Total
|
||||||||||||||
Expected amortization expense
|
|
$
|
66
|
|
|
$
|
127
|
|
|
$
|
124
|
|
|
$
|
121
|
|
|
$
|
113
|
|
|
$
|
457
|
|
|
$
|
1,008
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||
Anqing TP Goetze Piston Ring Company Limited (China)
|
35.7
|
%
|
|
35.7
|
%
|
Anqing TP Powder Metallurgy Co., Ltd (China)
|
20.0
|
%
|
|
20.0
|
%
|
Dongsuh Federal-Mogul Industrial Co. Ltd. (Korea)
|
50.0
|
%
|
|
50.0
|
%
|
Farloc Argentina SAIC Y F (Argentina)
|
23.9
|
%
|
|
23.9
|
%
|
Federal-Mogul Powertrain Otomotiv A.S. (Turkey)
|
50.0
|
%
|
|
50.0
|
%
|
Federal-Mogul TP Liner Europe Otomotiv Ltd. Sti. (Turkey)
|
25.0
|
%
|
|
25.0
|
%
|
Federal-Mogul TP Liners, Inc. (USA)
|
46.0
|
%
|
|
46.0
|
%
|
Frenos Hidraulicos Automotrices, S.A. de C.V. (Mexico)
|
49.0
|
%
|
|
49.0
|
%
|
JURID do Brasil Sistemas Automotivos Ltda. (Brazil)
|
19.9
|
%
|
|
19.9
|
%
|
KB Autosys Co., Ltd. (Korea)
|
33.6
|
%
|
|
33.6
|
%
|
Montagewerk Abgastechnik Emden GmbH (Germany)
|
50.0
|
%
|
|
50.0
|
%
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Investments in nonconsolidated affiliates
|
$
|
513
|
|
|
$
|
518
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Equity in earnings (losses) of nonconsolidated affiliates, net of tax
|
$
|
4
|
|
|
$
|
17
|
|
|
$
|
17
|
|
|
$
|
33
|
|
Cash dividends received from nonconsolidated affiliates
|
$
|
5
|
|
|
$
|
12
|
|
|
$
|
18
|
|
|
$
|
27
|
|
|
Three Months Ended June 30, 2020
|
||||||||||||||
Statements of Income
|
Otomotiv A.S.
|
|
Anqing TP Goetze
|
|
Other
|
|
Total
|
||||||||
Sales
|
$
|
24
|
|
|
$
|
11
|
|
|
$
|
41
|
|
|
$
|
76
|
|
Gross profit
|
$
|
6
|
|
|
$
|
5
|
|
|
$
|
6
|
|
|
$
|
17
|
|
Income from continuing operations
|
$
|
4
|
|
|
$
|
4
|
|
|
$
|
2
|
|
|
$
|
10
|
|
Net income
|
$
|
5
|
|
|
$
|
4
|
|
|
$
|
2
|
|
|
$
|
11
|
|
|
Three Months Ended June 30, 2019
|
||||||||||||||
Statements of Income
|
Otomotiv A.S.
|
|
Anqing TP Goetze
|
|
Other
|
|
Total
|
||||||||
Sales
|
$
|
85
|
|
|
$
|
39
|
|
|
$
|
120
|
|
|
$
|
244
|
|
Gross profit
|
$
|
22
|
|
|
$
|
10
|
|
|
$
|
23
|
|
|
$
|
55
|
|
Income from continuing operations
|
$
|
17
|
|
|
$
|
9
|
|
|
$
|
11
|
|
|
$
|
37
|
|
Net income
|
$
|
21
|
|
|
$
|
9
|
|
|
$
|
11
|
|
|
$
|
41
|
|
|
Six Months Ended June 30, 2020
|
||||||||||||||
Statements of Income
|
Otomotiv A.S.
|
|
Anqing TP Goetze
|
|
Other
|
|
Total
|
||||||||
Sales
|
$
|
120
|
|
|
$
|
41
|
|
|
$
|
146
|
|
|
$
|
307
|
|
Gross profit
|
$
|
32
|
|
|
$
|
11
|
|
|
$
|
26
|
|
|
$
|
69
|
|
Income from continuing operations
|
$
|
27
|
|
|
$
|
11
|
|
|
$
|
11
|
|
|
$
|
49
|
|
Net income
|
$
|
23
|
|
|
$
|
10
|
|
|
$
|
8
|
|
|
$
|
41
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||
Statements of Income
|
Otomotiv A.S.
|
|
Anqing TP Goetze
|
|
Other
|
|
Total
|
||||||||
Sales
|
$
|
176
|
|
|
$
|
78
|
|
|
$
|
245
|
|
|
$
|
499
|
|
Gross profit
|
$
|
43
|
|
|
$
|
26
|
|
|
$
|
46
|
|
|
$
|
115
|
|
Income from continuing operations
|
$
|
36
|
|
|
$
|
20
|
|
|
$
|
24
|
|
|
$
|
80
|
|
Net income
|
$
|
39
|
|
|
$
|
18
|
|
|
$
|
22
|
|
|
$
|
79
|
|
|
Notional Amount
|
||
Long positions
|
$
|
54
|
|
Short positions
|
$
|
(54
|
)
|
|
|
|
Carrying Value
|
||||||
|
Balance sheet classification
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Commodity price hedge contracts designated as cash flow hedges
|
Prepayments and other current assets
|
|
$
|
1
|
|
|
$
|
—
|
|
Foreign currency borrowings designated as net investment hedges
|
Long-term debt
|
|
$
|
878
|
|
|
$
|
850
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Commodity price hedge contracts designated as cash flow hedges
|
|
$
|
5
|
|
|
$
|
(3
|
)
|
|
$
|
2
|
|
|
$
|
1
|
|
Foreign currency borrowings designated as net investment hedges
|
|
$
|
(16
|
)
|
|
$
|
(12
|
)
|
|
$
|
(2
|
)
|
|
$
|
7
|
|
Level 1
|
—
|
Quoted prices in active markets for identical assets or liabilities.
|
|
|
|
Level 2
|
—
|
Inputs, other than quoted prices in active markets, that are observable either directly or indirectly.
|
|
|
|
Level 3
|
—
|
Unobservable inputs based on the Company's own assumptions.
|
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||||||||||
|
Fair value
hierarchy |
|
Carrying
Amount |
|
Fair
Value |
|
Carrying
Amount |
|
Fair
Value |
||||||||
Derivative asset (liability) instruments:
|
|
|
|
|
|
|
|
|
|
||||||||
Swap agreements
|
Level 2
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
(1
|
)
|
|
$
|
(1
|
)
|
Commodity contracts
|
Level 2
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||||||||||
|
Fair value
hierarchy |
|
Carrying
Amount |
|
Fair
Value |
|
Carrying
Amount |
|
Fair
Value |
||||||||
Long-term debt (including current maturities):
|
|
|
|
|
|
|
|
|
|
||||||||
Term loans and senior notes
|
Level 2
|
|
$
|
5,121
|
|
|
$
|
4,641
|
|
|
$
|
5,179
|
|
|
$
|
5,113
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||||||||||
|
Principal
|
|
Carrying Amount (a)
|
|
Principal
|
|
Carrying Amount (a)
|
||||||||
Credit Facilities
|
|
|
|
|
|
|
|
||||||||
Revolver Borrowings
|
|
|
|
|
|
|
|
||||||||
Due 2023
|
$
|
1,500
|
|
|
$
|
1,500
|
|
|
$
|
183
|
|
|
$
|
183
|
|
Term Loans
|
|
|
|
|
|
|
|
||||||||
LIBOR plus 2.00% Term Loan A due 2019 through 2023(b)
|
1,572
|
|
|
1,561
|
|
|
1,615
|
|
|
1,608
|
|
||||
LIBOR plus 3.00% Term Loan B due 2019 through 2025
|
1,675
|
|
|
1,614
|
|
|
1,683
|
|
|
1,623
|
|
||||
Senior Unsecured Notes
|
|
|
|
|
|
|
|
||||||||
$225 million of 5.375% Senior Notes due 2024
|
225
|
|
|
223
|
|
|
225
|
|
|
222
|
|
||||
$500 million of 5.000% Senior Notes due 2026
|
500
|
|
|
494
|
|
|
500
|
|
|
494
|
|
||||
Senior Secured Notes
|
|
|
|
|
|
|
|
||||||||
€415 million 4.875% Euro Fixed Rate Notes due 2022
|
466
|
|
|
477
|
|
|
465
|
|
|
479
|
|
||||
€300 million of Euribor plus 4.875% Euro Floating Rate Notes due 2024
|
337
|
|
|
340
|
|
|
336
|
|
|
340
|
|
||||
€350 million of 5.000% Euro Fixed Rate Notes due 2024
|
393
|
|
|
412
|
|
|
392
|
|
|
413
|
|
||||
Other debt, primarily foreign instruments
|
13
|
|
|
12
|
|
|
14
|
|
|
13
|
|
||||
|
|
|
6,633
|
|
|
|
|
5,375
|
|
||||||
Less - maturities classified as current
|
|
|
4
|
|
|
|
|
4
|
|
||||||
Total long-term debt
|
|
|
$
|
6,629
|
|
|
|
|
$
|
5,371
|
|
|
(a)
|
Carrying amount is net of unamortized debt issuance costs and debt discounts or premiums. Total unamortized debt issuance costs were $80 million and $76 million at June 30, 2020 and December 31, 2019. Total unamortized debt (premium) discount, net was $(32) million and $(37) million at June 30, 2020 and December 31, 2019.
|
(b)
|
The interest rate on Term Loan A at December 31, 2019 was LIBOR plus 1.75%.
|
|
June 30,
|
|
December 31,
|
||||
|
2020
|
|
2019
|
||||
Maturities classified as current
|
$
|
4
|
|
|
$
|
4
|
|
Short-term borrowings(a)
|
157
|
|
|
179
|
|
||
Bank overdrafts
|
61
|
|
|
2
|
|
||
Total short-term debt
|
$
|
222
|
|
|
$
|
185
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Amortization of debt issuance fees
|
$
|
5
|
|
|
$
|
4
|
|
|
$
|
10
|
|
|
$
|
9
|
|
Accretion of debt premium
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
(6
|
)
|
|
$
|
(6
|
)
|
|
Committed Credit Facilities
at June 30, 2020 |
||||
|
Term
|
|
Available(b)
|
||
|
|
|
(in billions)
|
||
Tenneco Inc. revolving credit facility (a)
|
2023
|
|
$
|
—
|
|
Tenneco Inc. Term Loan A
|
2023
|
|
—
|
|
|
Tenneco Inc. Term Loan B
|
2025
|
|
—
|
|
|
Subsidiaries’ credit agreements
|
2020 - 2028
|
|
—
|
|
|
|
|
|
$
|
—
|
|
|
(a)
|
The Company is required to pay commitment fees under the revolving credit facility on the unused portion of the total commitment.
|
(b)
|
Letters of credit reduce the available borrowings under the revolving credit facility.
|
Consolidated net leverage ratio
|
Interest rate
|
greater than 6.0 to 1
|
LIBOR plus 2.50%
|
less than 6.0 to 1 and greater than 4.5 to 1
|
LIBOR plus 2.25%
|
(i) Senior secured net leverage ratio
|
|
(ii) Consolidated net leverage ratio
|
||
not greater than 6.75 to 1
|
at June 30, 2020
|
|
not greater than 4.50 to 1
|
at March 31, 2020
|
not greater than 9.50 to 1
|
at September 30, 2020
|
|
not greater than 5.25 to 1
|
at March 31, 2022
|
not greater than 8.75 to 1
|
at December 31, 2020
|
|
not greater than 4.75 to 1
|
at June 30, 2022
|
not greater than 8.25 to 1
|
at March 31, 2021
|
|
not greater than 4.25 to 1
|
at September 30, 2022
|
not greater than 4.50 to 1
|
at June 30, 2021
|
|
not greater than 3.75 to 1
|
thereafter
|
not greater than 4.25 to 1
|
at September 30, 2021
|
|
|
|
not greater than 4.00 to 1
|
at December 31, 2021
|
|
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Borrowings on securitization programs
|
$
|
3
|
|
|
$
|
4
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Loss on sale of receivables(a)
|
$
|
4
|
|
|
$
|
6
|
|
|
$
|
10
|
|
|
$
|
14
|
|
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||
|
Pension Benefits
|
|
Other Postretirement Benefits
|
||||||||||||||||||||
|
2020
|
|
2019
|
|
|||||||||||||||||||
|
U.S.
|
|
Non-U.S.
|
|
U.S.
|
|
Non-U.S.
|
|
2020
|
|
2019
|
||||||||||||
Service cost
|
$
|
1
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost
|
10
|
|
|
5
|
|
|
14
|
|
|
5
|
|
|
3
|
|
|
4
|
|
||||||
Expected return on plan assets
|
(16
|
)
|
|
(4
|
)
|
|
(17
|
)
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
||||||
Net amortization:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Actuarial loss
|
1
|
|
|
2
|
|
|
1
|
|
|
2
|
|
|
—
|
|
|
1
|
|
||||||
Prior service cost (credit)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
||||||
Net pension and postretirement costs (credits)
|
$
|
(4
|
)
|
|
$
|
9
|
|
|
$
|
(2
|
)
|
|
$
|
9
|
|
|
$
|
1
|
|
|
$
|
3
|
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
Pension Benefits
|
|
Other Postretirement Benefits
|
||||||||||||||||||||
|
2020
|
|
2019
|
|
|||||||||||||||||||
|
U.S.
|
|
Non-U.S.
|
|
U.S.
|
|
Non-U.S.
|
|
2020
|
|
2019
|
||||||||||||
Service cost
|
$
|
1
|
|
|
$
|
12
|
|
|
$
|
1
|
|
|
$
|
12
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost
|
20
|
|
|
9
|
|
|
27
|
|
|
12
|
|
|
5
|
|
|
7
|
|
||||||
Expected return on plan assets
|
(32
|
)
|
|
(8
|
)
|
|
(34
|
)
|
|
(9
|
)
|
|
—
|
|
|
—
|
|
||||||
Net amortization:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Actuarial loss
|
3
|
|
|
4
|
|
|
2
|
|
|
3
|
|
|
1
|
|
|
2
|
|
||||||
Prior service cost (credit)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
(4
|
)
|
||||||
Net pension and postretirement costs (credits)
|
$
|
(8
|
)
|
|
$
|
17
|
|
|
$
|
(4
|
)
|
|
$
|
18
|
|
|
$
|
2
|
|
|
$
|
5
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Accrued expenses and other current liabilities
|
$
|
9
|
|
|
$
|
8
|
|
Deferred credits and other liabilities
|
26
|
|
|
28
|
|
||
|
$
|
35
|
|
|
$
|
36
|
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
2025 and thereafter
|
||||||||||||
Expected payments
|
$
|
5
|
|
|
$
|
4
|
|
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
15
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Accrued expenses and other current liabilities
|
$
|
3
|
|
|
$
|
3
|
|
Deferred credits and other liabilities
|
12
|
|
|
13
|
|
||
|
$
|
15
|
|
|
$
|
16
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Balance at beginning of period
|
$
|
51
|
|
|
$
|
48
|
|
|
$
|
54
|
|
|
$
|
45
|
|
Accruals related to product warranties
|
1
|
|
|
16
|
|
|
4
|
|
|
21
|
|
||||
Reductions for payments made
|
(1
|
)
|
|
(11
|
)
|
|
(7
|
)
|
|
(13
|
)
|
||||
Foreign currency
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
Balance at end of period
|
$
|
50
|
|
|
$
|
53
|
|
|
$
|
50
|
|
|
$
|
53
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Cash-settled share-based compensation expense (benefit)
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
—
|
|
Share-settled share-based compensation expense (benefit)
|
7
|
|
|
6
|
|
|
9
|
|
|
13
|
|
||||
|
$
|
8
|
|
|
$
|
7
|
|
|
$
|
10
|
|
|
$
|
13
|
|
|
Restricted Stock
|
|
Share-Settled RSUs
|
|
PSUs
|
|||||||||||||||
|
Shares
|
|
Weighted Avg.
Grant Date Fair Value |
|
Units
|
|
Weighted Avg.
Grant Date Fair Value |
|
Units
|
|
Weighted Avg.
Grant Date Fair Value |
|||||||||
Nonvested balance at beginning of period
|
35,630
|
|
|
$
|
63.27
|
|
|
1,125,346
|
|
|
$
|
37.91
|
|
|
806,233
|
|
|
$
|
34.12
|
|
Granted
|
169,781
|
|
|
9.15
|
|
|
1,511,307
|
|
|
7.83
|
|
|
6,654
|
|
|
12.26
|
|
|||
Vested
|
(200,223
|
)
|
|
40.69
|
|
|
(289,074
|
)
|
|
41.39
|
|
|
—
|
|
|
—
|
|
|||
Forfeited
|
(1,781
|
)
|
|
58.01
|
|
|
(339,120
|
)
|
|
34.93
|
|
|
(264,471
|
)
|
|
28.91
|
|
|||
Nonvested balance at end of period
|
3,407
|
|
|
$
|
59.87
|
|
|
2,008,459
|
|
|
$
|
27.60
|
|
|
548,416
|
|
|
$
|
36.15
|
|
|
Six Months Ended June 30,
|
||||||||||
|
Class A Common Stock
|
|
Class B Common Stock
|
||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||
Shares issued at beginning of period
|
71,727,061
|
|
|
71,675,379
|
|
|
23,793,669
|
|
|
23,793,669
|
|
Issuance (repurchased) pursuant to benefit plans
|
458,855
|
|
|
123,216
|
|
|
—
|
|
|
—
|
|
Restricted stock forfeited and withheld for taxes
|
(124,440
|
)
|
|
(60,081
|
)
|
|
—
|
|
|
—
|
|
Stock options exercised
|
—
|
|
|
8,438
|
|
|
—
|
|
|
—
|
|
Class B common stock converted to Class A common stock
|
3,485,215
|
|
|
—
|
|
|
(3,485,215
|
)
|
|
—
|
|
Shares issued at end of period
|
75,546,691
|
|
|
71,746,952
|
|
|
20,308,454
|
|
|
23,793,669
|
|
|
|
|
|
|
|
|
|
||||
Treasury stock
|
14,592,888
|
|
|
14,592,888
|
|
|
—
|
|
|
—
|
|
Total shares outstanding
|
60,953,803
|
|
|
57,154,064
|
|
|
20,308,454
|
|
|
23,793,669
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Foreign currency translation adjustments and other:
|
|
|
|
|
|
|
|
||||||||
Balance at beginning of period
|
$
|
(568
|
)
|
|
$
|
(366
|
)
|
|
$
|
(369
|
)
|
|
$
|
(395
|
)
|
Other comprehensive income (loss) before reclassifications
|
34
|
|
|
(16
|
)
|
|
(165
|
)
|
|
11
|
|
||||
Reclassification from other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Other comprehensive income (loss)
|
34
|
|
|
(16
|
)
|
|
(165
|
)
|
|
11
|
|
||||
Income tax benefit (provision)
|
1
|
|
|
(1
|
)
|
|
1
|
|
|
1
|
|
||||
Balance at end of period
|
(533
|
)
|
|
(383
|
)
|
|
(533
|
)
|
|
(383
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Pensions and other postretirement benefits:
|
|
|
|
|
|
|
|
||||||||
Balance at beginning of period
|
(338
|
)
|
|
(296
|
)
|
|
(342
|
)
|
|
(297
|
)
|
||||
Other comprehensive income (loss) before reclassifications
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Reclassification from other comprehensive income (loss)
|
1
|
|
|
2
|
|
|
4
|
|
|
3
|
|
||||
Other comprehensive income (loss)
|
1
|
|
|
2
|
|
|
4
|
|
|
3
|
|
||||
Income tax benefit (provision)
|
(6
|
)
|
|
(4
|
)
|
|
(5
|
)
|
|
(4
|
)
|
||||
Balance at end of period
|
(343
|
)
|
|
(298
|
)
|
|
(343
|
)
|
|
(298
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Cash flow hedge instruments:
|
|
|
|
|
|
|
|
||||||||
Balance at beginning of period
|
(2
|
)
|
|
4
|
|
|
—
|
|
|
—
|
|
||||
Other comprehensive income (loss) before reclassifications
|
5
|
|
|
(3
|
)
|
|
2
|
|
|
1
|
|
||||
Reclassification from other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Other comprehensive income (loss)
|
5
|
|
|
(3
|
)
|
|
2
|
|
|
1
|
|
||||
Income tax benefit (provision)
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Balance at end of period
|
2
|
|
|
1
|
|
|
2
|
|
|
1
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Accumulated other comprehensive loss at end of period
|
$
|
(874
|
)
|
|
$
|
(680
|
)
|
|
$
|
(874
|
)
|
|
$
|
(680
|
)
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss) attributable to noncontrolling interests
|
$
|
7
|
|
|
$
|
(1
|
)
|
|
$
|
(13
|
)
|
|
$
|
5
|
|
|
Reportable Segments
|
|
|
|
|
||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total
|
|
Reclass & Elims
|
|
Total
|
||||||||||||||
For the Three Months Ended June 30, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenues from external customers
|
$
|
1,140
|
|
|
$
|
602
|
|
|
$
|
336
|
|
|
$
|
559
|
|
|
$
|
2,637
|
|
|
$
|
—
|
|
|
$
|
2,637
|
|
Intersegment revenues
|
$
|
3
|
|
|
$
|
21
|
|
|
$
|
21
|
|
|
$
|
6
|
|
|
$
|
51
|
|
|
$
|
(51
|
)
|
|
$
|
—
|
|
Equity in earnings of nonconsolidated affiliates, net of tax
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
4
|
|
For the Three Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenues from external customers
|
$
|
1,827
|
|
|
$
|
1,133
|
|
|
$
|
709
|
|
|
$
|
835
|
|
|
$
|
4,504
|
|
|
$
|
—
|
|
|
$
|
4,504
|
|
Intersegment revenues
|
$
|
—
|
|
|
$
|
40
|
|
|
$
|
38
|
|
|
$
|
11
|
|
|
$
|
89
|
|
|
$
|
(89
|
)
|
|
$
|
—
|
|
Equity in earnings of nonconsolidated affiliates, net of tax
|
$
|
—
|
|
|
$
|
14
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
17
|
|
|
$
|
—
|
|
|
$
|
17
|
|
For the Six Months Ended June 30, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenues from external customers
|
$
|
2,685
|
|
|
$
|
1,599
|
|
|
$
|
924
|
|
|
$
|
1,265
|
|
|
$
|
6,473
|
|
|
$
|
—
|
|
|
$
|
6,473
|
|
Intersegment revenues
|
$
|
9
|
|
|
$
|
59
|
|
|
$
|
50
|
|
|
$
|
15
|
|
|
$
|
133
|
|
|
$
|
(133
|
)
|
|
$
|
—
|
|
Equity in earnings of nonconsolidated affiliates, net of tax
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
1
|
|
|
$
|
3
|
|
|
$
|
17
|
|
|
$
|
—
|
|
|
$
|
17
|
|
For the Six Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenues from external customers
|
$
|
3,606
|
|
|
$
|
2,308
|
|
|
$
|
1,442
|
|
|
$
|
1,632
|
|
|
$
|
8,988
|
|
|
$
|
—
|
|
|
$
|
8,988
|
|
Intersegment revenues
|
$
|
—
|
|
|
$
|
86
|
|
|
$
|
84
|
|
|
$
|
22
|
|
|
$
|
192
|
|
|
$
|
(192
|
)
|
|
$
|
—
|
|
Equity in earnings of nonconsolidated affiliates, net of tax
|
$
|
—
|
|
|
$
|
27
|
|
|
$
|
2
|
|
|
$
|
4
|
|
|
$
|
33
|
|
|
$
|
—
|
|
|
$
|
33
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
EBITDA including noncontrolling interests by segment:
|
|
|
|
|
|
|
|
||||||||
Clean Air
|
$
|
17
|
|
|
$
|
152
|
|
|
$
|
116
|
|
|
$
|
283
|
|
Powertrain
|
(62
|
)
|
|
100
|
|
|
(132
|
)
|
|
213
|
|
||||
Ride Performance
|
(70
|
)
|
|
26
|
|
|
(647
|
)
|
|
(19
|
)
|
||||
Motorparts
|
(52
|
)
|
|
110
|
|
|
(92
|
)
|
|
155
|
|
||||
Total reportable segments
|
(167
|
)
|
|
388
|
|
|
(755
|
)
|
|
632
|
|
||||
Corporate
|
(49
|
)
|
|
(78
|
)
|
|
(135
|
)
|
|
(177
|
)
|
||||
Depreciation and amortization
|
(159
|
)
|
|
(169
|
)
|
|
(330
|
)
|
|
(338
|
)
|
||||
Earnings (loss) before interest expense, income taxes, and noncontrolling interests
|
(375
|
)
|
|
141
|
|
|
(1,220
|
)
|
|
117
|
|
||||
Interest expense
|
(66
|
)
|
|
(82
|
)
|
|
(141
|
)
|
|
(163
|
)
|
||||
Income tax (expense) benefit
|
101
|
|
|
(14
|
)
|
|
195
|
|
|
(14
|
)
|
||||
Net income (loss)
|
$
|
(340
|
)
|
|
$
|
45
|
|
|
$
|
(1,166
|
)
|
|
$
|
(60
|
)
|
|
Reportable Segments
|
||||||||||||||||||
By Customer Type
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total
|
||||||||||
Three Months Ended June 30, 2020
|
|
|
|
|
|
|
|
|
|
||||||||||
OE - Substrate
|
$
|
623
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
623
|
|
OE - Value add
|
517
|
|
|
602
|
|
|
326
|
|
|
—
|
|
|
1,445
|
|
|||||
Aftermarket
|
—
|
|
|
—
|
|
|
10
|
|
|
559
|
|
|
569
|
|
|||||
Total
|
$
|
1,140
|
|
|
$
|
602
|
|
|
$
|
336
|
|
|
$
|
559
|
|
|
$
|
2,637
|
|
Three Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
OE - Substrate
|
$
|
777
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
777
|
|
OE - Value add
|
1,050
|
|
|
1,133
|
|
|
695
|
|
|
—
|
|
|
2,878
|
|
|||||
Aftermarket
|
—
|
|
|
—
|
|
|
14
|
|
|
835
|
|
|
849
|
|
|||||
Total
|
$
|
1,827
|
|
|
$
|
1,133
|
|
|
$
|
709
|
|
|
$
|
835
|
|
|
$
|
4,504
|
|
Six Months Ended June 30, 2020
|
|
|
|
|
|
|
|
|
|
||||||||||
OE - Substrate
|
$
|
1,323
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,323
|
|
OE - Value add
|
1,362
|
|
|
1,599
|
|
|
899
|
|
|
—
|
|
|
3,860
|
|
|||||
Aftermarket
|
—
|
|
|
—
|
|
|
25
|
|
|
1,265
|
|
|
1,290
|
|
|||||
Total
|
$
|
2,685
|
|
|
$
|
1,599
|
|
|
$
|
924
|
|
|
$
|
1,265
|
|
|
$
|
6,473
|
|
Six Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
OE - Substrate
|
$
|
1,483
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,483
|
|
OE - Value add
|
2,123
|
|
|
2,308
|
|
|
1,414
|
|
|
—
|
|
|
5,845
|
|
|||||
Aftermarket
|
—
|
|
|
—
|
|
|
28
|
|
|
1,632
|
|
|
1,660
|
|
|||||
Total
|
$
|
3,606
|
|
|
$
|
2,308
|
|
|
$
|
1,442
|
|
|
$
|
1,632
|
|
|
$
|
8,988
|
|
|
Reportable Segments
|
||||||||||||||||||
By Geography
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total
|
||||||||||
Three Months Ended June 30, 2020
|
|
|
|
|
|
|
|
|
|
||||||||||
North America
|
$
|
335
|
|
|
$
|
168
|
|
|
$
|
81
|
|
|
$
|
389
|
|
|
$
|
973
|
|
Europe, Middle East and Africa
|
248
|
|
|
263
|
|
|
161
|
|
|
135
|
|
|
807
|
|
|||||
Rest of world
|
557
|
|
|
171
|
|
|
94
|
|
|
35
|
|
|
857
|
|
|||||
Total
|
$
|
1,140
|
|
|
$
|
602
|
|
|
$
|
336
|
|
|
$
|
559
|
|
|
$
|
2,637
|
|
Three Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
North America
|
$
|
800
|
|
|
$
|
398
|
|
|
$
|
228
|
|
|
$
|
536
|
|
|
$
|
1,962
|
|
Europe, Middle East and Africa
|
609
|
|
|
540
|
|
|
349
|
|
|
241
|
|
|
1,739
|
|
|||||
Rest of world
|
418
|
|
|
195
|
|
|
132
|
|
|
58
|
|
|
803
|
|
|||||
Total
|
$
|
1,827
|
|
|
$
|
1,133
|
|
|
$
|
709
|
|
|
$
|
835
|
|
|
$
|
4,504
|
|
Six Months Ended June 30, 2020
|
|
|
|
|
|
|
|
|
|
||||||||||
North America
|
$
|
1,039
|
|
|
$
|
512
|
|
|
$
|
279
|
|
|
$
|
865
|
|
|
$
|
2,695
|
|
Europe, Middle East and Africa
|
813
|
|
|
755
|
|
|
458
|
|
|
332
|
|
|
2,358
|
|
|||||
Rest of world
|
833
|
|
|
332
|
|
|
187
|
|
|
68
|
|
|
1,420
|
|
|||||
Total
|
$
|
2,685
|
|
|
$
|
1,599
|
|
|
$
|
924
|
|
|
$
|
1,265
|
|
|
$
|
6,473
|
|
Six Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
North America
|
$
|
1,593
|
|
|
$
|
803
|
|
|
$
|
460
|
|
|
$
|
1,043
|
|
|
$
|
3,899
|
|
Europe, Middle East and Africa
|
1,250
|
|
|
1,115
|
|
|
727
|
|
|
478
|
|
|
3,570
|
|
|||||
Rest of world
|
763
|
|
|
390
|
|
|
255
|
|
|
111
|
|
|
1,519
|
|
|||||
Total
|
$
|
3,606
|
|
|
$
|
2,308
|
|
|
$
|
1,442
|
|
|
$
|
1,632
|
|
|
$
|
8,988
|
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||
|
2020
|
|
2019
|
||||||||||||||||||||
|
Net Sales
|
|
Purchases
|
|
Royalty and Other
|
|
Net Sales
|
|
Purchases
|
|
Royalty and Other
|
||||||||||||
Anqing TP Goetze Piston Ring Company Limited
|
$
|
1
|
|
|
$
|
16
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
1
|
|
Anqing TP Powder Metallurgy Company Limited
|
$
|
2
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
—
|
|
Dongsuh Federal-Mogul Industrial Co., Ltd.
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
5
|
|
|
$
|
—
|
|
Federal-Mogul Powertrain Otomotiv A.S.
|
$
|
5
|
|
|
$
|
17
|
|
|
$
|
2
|
|
|
$
|
16
|
|
|
$
|
53
|
|
|
$
|
1
|
|
Federal-Mogul TP Liner Europe Otomotiv Ltd. Sti.
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
Federal-Mogul TP Liners, Inc.
|
$
|
3
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Frenos Hidraulicos Autos
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Icahn Automotive Group LLC
|
$
|
32
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
47
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Montagewerk Abgastechnik Emden GmbH
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
PSC Metals, Inc.
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
2020
|
|
2019
|
||||||||||||||||||||
|
Net Sales
|
|
Purchases
|
|
Royalty and Other
|
|
Net Sales
|
|
Purchases
|
|
Royalty and Other
|
||||||||||||
Anqing TP Goetze Piston Ring Company Limited
|
$
|
5
|
|
|
$
|
26
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
29
|
|
|
$
|
—
|
|
Anqing TP Powder Metallurgy Company Limited
|
$
|
3
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
3
|
|
|
$
|
—
|
|
Dongsuh Federal-Mogul Industrial Co., Ltd.
|
$
|
1
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
7
|
|
|
$
|
—
|
|
Federal-Mogul Powertrain Otomotiv A.S.
|
$
|
17
|
|
|
$
|
76
|
|
|
$
|
6
|
|
|
$
|
44
|
|
|
$
|
112
|
|
|
$
|
2
|
|
Federal-Mogul TP Liner Europe Otomotiv Ltd. Sti.
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
—
|
|
Federal-Mogul TP Liners, Inc.
|
$
|
7
|
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Frenos Hidraulicos Autos
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Icahn Automotive Group LLC
|
$
|
65
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
90
|
|
|
$
|
—
|
|
|
$
|
2
|
|
Montagewerk Abgastechnik Emden GmbH
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
PSC Metals, Inc.
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||||||||||
|
Receivables
|
|
Payables and Accruals
|
|
Receivables
|
|
Payables and Accruals
|
||||||||
Anqing TP Goetze Piston Ring Company Limited
|
$
|
2
|
|
|
$
|
22
|
|
|
$
|
1
|
|
|
$
|
26
|
|
Anqing TP Powder Metallurgy Company Limited
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Dongsuh Federal-Mogul Industrial Co., Ltd.
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
2
|
|
Farloc Argentina SAIC
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
Federal-Mogul Powertrain Otomotiv A.S.
|
$
|
8
|
|
|
$
|
24
|
|
|
$
|
8
|
|
|
$
|
31
|
|
Federal-Mogul TP Liners, Inc.
|
$
|
1
|
|
|
$
|
4
|
|
|
$
|
2
|
|
|
$
|
7
|
|
Icahn Automotive Group LLC
|
$
|
45
|
|
|
$
|
8
|
|
|
$
|
52
|
|
|
$
|
10
|
|
Montagewerk Abgastechnik Emden GmbH
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
•
|
The Clean Air segment designs, manufactures, and distributes a variety of products and systems designed to reduce pollution and optimize engine performance, acoustic tuning, and weight on a vehicle for OE customers;
|
•
|
The Powertrain segment focuses on original equipment powertrain products for automotive, heavy duty, and industrial applications;
|
•
|
The Ride Performance segment designs, manufactures, markets, and distributes a variety of ride performance solutions and systems to a global OE customer base, including noise, vibration, and harshness performance materials, advanced suspension technologies, ride control, and braking; and
|
•
|
The Motorparts segment engineers, manufactures, sources, and distributes a broad portfolio of products in the global vehicle aftermarket while also servicing the original equipment and original equipment servicers market with products, including vehicle braking systems and a wide variety of chassis, engine, sealing, wiper, filter, lighting, and other general maintenance applications.
|
•
|
an increase in restructuring charges, net and asset impairments of $540 million primarily related to the impairment of long-lived asset groups triggered by the effects of the COVID-19 global pandemic on the Company's projected financial information, global headcount and cost reduction initiatives, and other actions to optimize our distribution footprint and warehousing locations; and
|
•
|
an increase in goodwill and intangible impairment charges of $323 million, which was comprised of an increase in goodwill impairment charges of $207 million, $65 million of definite-lived intangible asset impairments, and $51 million of indefinite-lived intangible asset impairments.
|
•
|
a decrease in selling, general, and administrative costs of $166 million, primarily due to $41 million in lower acquisition and expected separation costs, and the favorable effects of cost reduction initiatives implemented in response to the effects of COVID-19, including unpaid furloughs, net pay decreases, temporary support programs, and other compensation related expenses;
|
•
|
a decrease in engineering, research, and development of $38 million primarily due to the effects of COVID-19 and cost reduction initiatives; and
|
•
|
an increase in income tax benefit of $209 million primarily resulting from the impairment charges recognized in the six months ended June 30, 2020.
|
|
Three Months Ended June 30,
|
|
Increase / (Decrease)
|
|
Six Months Ended June 30,
|
|
Increase / (Decrease)
|
||||||||||||||||||||||
|
2020
|
|
2019
|
|
$ Change
|
|
% Change (1)
|
|
2020
|
|
2019
|
|
$ Change
|
|
% Change (1)
|
||||||||||||||
|
(millions, except percent, share, and per share amounts)
|
||||||||||||||||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net sales and operating revenues
|
$
|
2,637
|
|
|
$
|
4,504
|
|
|
$
|
(1,867
|
)
|
|
(41
|
)%
|
|
$
|
6,473
|
|
|
$
|
8,988
|
|
|
$
|
(2,515
|
)
|
|
(28
|
)%
|
Costs and expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of sales (exclusive of depreciation and amortization)
|
2,498
|
|
|
3,801
|
|
|
(1,303
|
)
|
|
(34
|
)%
|
|
5,837
|
|
|
7,671
|
|
|
(1,834
|
)
|
|
(24
|
)%
|
||||||
Selling, general, and administrative
|
195
|
|
|
292
|
|
|
(97
|
)
|
|
(33
|
)%
|
|
444
|
|
|
610
|
|
|
(166
|
)
|
|
(27
|
)%
|
||||||
Depreciation and amortization
|
159
|
|
|
169
|
|
|
(10
|
)
|
|
(6
|
)%
|
|
330
|
|
|
338
|
|
|
(8
|
)
|
|
(2
|
)%
|
||||||
Engineering, research, and development
|
55
|
|
|
78
|
|
|
(23
|
)
|
|
(29
|
)%
|
|
132
|
|
|
170
|
|
|
(38
|
)
|
|
(22
|
)%
|
||||||
Restructuring charges, net and asset impairments
|
121
|
|
|
49
|
|
|
72
|
|
|
147
|
%
|
|
605
|
|
|
65
|
|
|
540
|
|
|
n/m
|
|
||||||
Goodwill and intangible impairment charges
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
383
|
|
|
60
|
|
|
323
|
|
|
n/m
|
|
||||||
|
3,028
|
|
|
4,389
|
|
|
(1,361
|
)
|
|
(31
|
)%
|
|
7,731
|
|
|
8,914
|
|
|
(1,183
|
)
|
|
(13
|
)%
|
||||||
Other income (expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Non-service pension and other postretirement benefit (costs) credits
|
1
|
|
|
(4
|
)
|
|
5
|
|
|
n/m
|
|
|
2
|
|
|
(6
|
)
|
|
8
|
|
|
n/m
|
|
||||||
Equity in earnings (losses) of nonconsolidated affiliates, net of tax
|
4
|
|
|
17
|
|
|
(13
|
)
|
|
(76
|
)%
|
|
17
|
|
|
33
|
|
|
(16
|
)
|
|
(48
|
)%
|
||||||
Other income (expense), net
|
11
|
|
|
13
|
|
|
(2
|
)
|
|
(15
|
)%
|
|
19
|
|
|
16
|
|
|
3
|
|
|
19
|
%
|
||||||
|
16
|
|
|
26
|
|
|
(10
|
)
|
|
(38
|
)%
|
|
38
|
|
|
43
|
|
|
(5
|
)
|
|
(12
|
)%
|
||||||
Earnings (loss) before interest expense, income taxes, and noncontrolling interests
|
(375
|
)
|
|
141
|
|
|
(516
|
)
|
|
n/m
|
|
|
(1,220
|
)
|
|
117
|
|
|
(1,337
|
)
|
|
n/m
|
|
||||||
Interest expense
|
(66
|
)
|
|
(82
|
)
|
|
(16
|
)
|
|
(20
|
)%
|
|
(141
|
)
|
|
(163
|
)
|
|
(22
|
)
|
|
(13
|
)%
|
||||||
Earnings (loss) before income taxes and noncontrolling interests
|
(441
|
)
|
|
59
|
|
|
(500
|
)
|
|
n/m
|
|
|
(1,361
|
)
|
|
(46
|
)
|
|
(1,315
|
)
|
|
n/m
|
|
||||||
Income tax (expense) benefit
|
101
|
|
|
(14
|
)
|
|
115
|
|
|
n/m
|
|
|
195
|
|
|
(14
|
)
|
|
209
|
|
|
n/m
|
|
||||||
Net income (loss)
|
(340
|
)
|
|
45
|
|
|
(385
|
)
|
|
n/m
|
|
|
(1,166
|
)
|
|
(60
|
)
|
|
(1,106
|
)
|
|
n/m
|
|
||||||
Less: Net income (loss) attributable to noncontrolling interests
|
10
|
|
|
19
|
|
|
(9
|
)
|
|
(47
|
)%
|
|
23
|
|
|
31
|
|
|
(8
|
)
|
|
(26
|
)%
|
||||||
Net income (loss) attributable to Tenneco Inc.
|
$
|
(350
|
)
|
|
$
|
26
|
|
|
$
|
(376
|
)
|
|
n/m
|
|
|
$
|
(1,189
|
)
|
|
$
|
(91
|
)
|
|
$
|
(1,098
|
)
|
|
n/m
|
|
Earnings (loss) per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Earnings (loss) per share
|
$
|
(4.30
|
)
|
|
$
|
0.32
|
|
|
|
|
|
|
$
|
(14.64
|
)
|
|
$
|
(1.13
|
)
|
|
|
|
|
||||||
Weighted average shares outstanding
|
81,350,773
|
|
|
80,920,825
|
|
|
|
|
|
|
81,259,667
|
|
|
80,897,731
|
|
|
|
|
|
||||||||||
Diluted earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Earnings (loss) per share
|
$
|
(4.30
|
)
|
|
$
|
0.32
|
|
|
|
|
|
|
$
|
(14.64
|
)
|
|
$
|
(1.13
|
)
|
|
|
|
|
||||||
Weighted average shares outstanding
|
81,350,773
|
|
|
80,920,825
|
|
|
|
|
|
|
81,259,667
|
|
|
80,897,731
|
|
|
|
|
|
|
Three months ended June 30, 2019
|
$
|
4,504
|
|
Acquisitions and divestitures, net
|
(15
|
)
|
|
Drivers in the change of organic revenues:
|
|
|
|
Volume and mix
|
(1,730
|
)
|
|
Currency exchange rates
|
(108
|
)
|
|
Others
|
(14
|
)
|
|
Three months ended June 30, 2020
|
$
|
2,637
|
|
Six months ended June 30, 2019
|
$
|
8,988
|
|
Acquisitions and divestitures, net
|
(60
|
)
|
|
Drivers in the change of organic revenues:
|
|
||
Volume and mix
|
(2,229
|
)
|
|
Currency exchange rates
|
(205
|
)
|
|
Others
|
(21
|
)
|
|
Six months ended June 30, 2020
|
$
|
6,473
|
|
Three months ended June 30, 2019
|
$
|
3,801
|
|
Acquisitions and divestitures, net
|
(12
|
)
|
|
Drivers in the change of organic cost of sales:
|
|
|
|
Volume and mix
|
(1,233
|
)
|
|
Material
|
2
|
|
|
Currency exchange rates
|
(92
|
)
|
|
Inventory write-down
|
82
|
|
|
Others
|
(50
|
)
|
|
Three months ended June 30, 2020
|
$
|
2,498
|
|
Six months ended June 30, 2019
|
$
|
7,671
|
|
Acquisitions and divestitures, net
|
(55
|
)
|
|
Drivers in the change of organic cost of sales:
|
|
||
Volume and mix
|
(1,618
|
)
|
|
Material
|
(22
|
)
|
|
Currency exchange rates
|
(181
|
)
|
|
Inventory write-down
|
82
|
|
|
Others
|
(40
|
)
|
|
Six months ended June 30, 2020
|
$
|
5,837
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
EBITDA including noncontrolling interests:
|
|
|
|
|
|
|
|
|
|
|
||||||
Clean Air
|
|
$
|
17
|
|
|
$
|
152
|
|
|
$
|
116
|
|
|
$
|
283
|
|
Powertrain
|
|
(62
|
)
|
|
100
|
|
|
(132
|
)
|
|
213
|
|
||||
Ride Performance
|
|
(70
|
)
|
|
26
|
|
|
(647
|
)
|
|
(19
|
)
|
||||
Motorparts
|
|
(52
|
)
|
|
110
|
|
|
(92
|
)
|
|
155
|
|
||||
Corporate
|
|
(49
|
)
|
|
(78
|
)
|
|
(135
|
)
|
|
(177
|
)
|
||||
Depreciation
|
|
(159
|
)
|
|
(169
|
)
|
|
(330
|
)
|
|
(338
|
)
|
||||
Earnings (loss) before interest expense, income taxes, and noncontrolling interests
|
|
(375
|
)
|
|
141
|
|
|
(1,220
|
)
|
|
117
|
|
||||
Interest expense
|
|
(66
|
)
|
|
(82
|
)
|
|
(141
|
)
|
|
(163
|
)
|
||||
Income tax (expense) benefit
|
|
101
|
|
|
(14
|
)
|
|
195
|
|
|
(14
|
)
|
||||
Net income (loss)
|
|
$
|
(340
|
)
|
|
$
|
45
|
|
|
$
|
(1,166
|
)
|
|
$
|
(60
|
)
|
|
Segments
|
|
|
|
|
||||||||||||||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total Revenues
|
||||||||||||||||||||||||||||||
For the Three Months Ended June 30,
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||||||||||||||
Revenues
|
$
|
1,140
|
|
|
$
|
1,827
|
|
|
$
|
602
|
|
|
$
|
1,133
|
|
|
$
|
336
|
|
|
$
|
709
|
|
|
$
|
559
|
|
|
$
|
835
|
|
|
$
|
2,637
|
|
|
$
|
4,504
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Value-add revenues
|
517
|
|
|
1,050
|
|
|
602
|
|
|
1,133
|
|
|
336
|
|
|
709
|
|
|
559
|
|
|
835
|
|
|
2,014
|
|
|
3,727
|
|
||||||||||
Currency effect on value-add revenue
|
(16
|
)
|
|
—
|
|
|
(35
|
)
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|
(27
|
)
|
|
—
|
|
|
(93
|
)
|
|
—
|
|
||||||||||
Value-add revenue excluding currency
|
$
|
533
|
|
|
$
|
1,050
|
|
|
$
|
637
|
|
|
$
|
1,133
|
|
|
$
|
351
|
|
|
$
|
709
|
|
|
$
|
586
|
|
|
$
|
835
|
|
|
$
|
2,107
|
|
|
$
|
3,727
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Substrate sales
|
$
|
623
|
|
|
$
|
777
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
623
|
|
|
$
|
777
|
|
|
Segments
|
|
|
|
|
||||||||||||||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total Revenues
|
||||||||||||||||||||||||||||||
For the Six Months Ended June 30,
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||||||||||||||
Revenues
|
$
|
2,685
|
|
|
$
|
3,606
|
|
|
$
|
1,599
|
|
|
$
|
2,308
|
|
|
$
|
924
|
|
|
$
|
1,442
|
|
|
$
|
1,265
|
|
|
$
|
1,632
|
|
|
$
|
6,473
|
|
|
$
|
8,988
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Value-add revenues
|
1,362
|
|
|
2,123
|
|
|
1,599
|
|
|
2,308
|
|
|
924
|
|
|
1,442
|
|
|
1,265
|
|
|
1,632
|
|
|
5,150
|
|
|
7,505
|
|
||||||||||
Currency effect on value-add revenue
|
(35
|
)
|
|
—
|
|
|
(61
|
)
|
|
—
|
|
|
(32
|
)
|
|
—
|
|
|
(46
|
)
|
|
—
|
|
|
(174
|
)
|
|
(28
|
)
|
||||||||||
Value-add revenue excluding currency
|
$
|
1,397
|
|
|
$
|
2,123
|
|
|
$
|
1,660
|
|
|
$
|
2,308
|
|
|
$
|
956
|
|
|
$
|
1,442
|
|
|
$
|
1,311
|
|
|
$
|
1,632
|
|
|
$
|
5,324
|
|
|
$
|
7,533
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Substrate sales
|
$
|
1,323
|
|
|
$
|
1,483
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,323
|
|
|
$
|
1,483
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
Three Months Ended June 30
|
|
Six Months Ended June 30
|
||||||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020 vs 2019 Change
|
|
2020 vs 2019 Change
|
||||||||||||
EBITDA including noncontrolling interests by segment:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Clean Air
|
$
|
17
|
|
|
$
|
152
|
|
|
$
|
116
|
|
|
$
|
283
|
|
|
$
|
(135
|
)
|
|
$
|
(167
|
)
|
Powertrain
|
$
|
(62
|
)
|
|
$
|
100
|
|
|
$
|
(132
|
)
|
|
$
|
213
|
|
|
$
|
(162
|
)
|
|
$
|
(345
|
)
|
Ride Performance
|
$
|
(70
|
)
|
|
$
|
26
|
|
|
$
|
(647
|
)
|
|
$
|
(19
|
)
|
|
$
|
(96
|
)
|
|
$
|
(628
|
)
|
Motorparts
|
$
|
(52
|
)
|
|
$
|
110
|
|
|
$
|
(92
|
)
|
|
$
|
155
|
|
|
$
|
(162
|
)
|
|
$
|
(247
|
)
|
|
Reportable Segments
|
|
|
|
|
||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total
|
|
Corporate
|
|
Total
|
||||||||||||||
Three Months Ended June 30, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Restructuring charges, net
|
$
|
22
|
|
|
$
|
36
|
|
|
$
|
18
|
|
|
$
|
15
|
|
|
$
|
91
|
|
|
$
|
1
|
|
|
$
|
92
|
|
Restructuring related costs
|
(1
|
)
|
|
1
|
|
|
11
|
|
|
2
|
|
|
13
|
|
|
—
|
|
|
13
|
|
|||||||
Inventory write-down(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
82
|
|
|
82
|
|
|
—
|
|
|
82
|
|
|||||||
Asset impairments restructuring related
|
—
|
|
|
3
|
|
|
—
|
|
|
25
|
|
|
28
|
|
|
—
|
|
|
28
|
|
|||||||
Other non-restructuring asset impairments
|
—
|
|
|
1
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||||
Acquisition and expected separation costs (2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
8
|
|
|||||||
Total adjustments
|
$
|
21
|
|
|
$
|
41
|
|
|
$
|
29
|
|
|
$
|
123
|
|
|
$
|
214
|
|
|
$
|
10
|
|
|
$
|
224
|
|
|
|
Reportable Segments
|
|
|
|
|
||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total
|
|
Corporate
|
|
Total
|
||||||||||||||
Three Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Costs to achieve synergies (1)
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
3
|
|
Restructuring and related expenses
|
14
|
|
|
17
|
|
|
22
|
|
|
6
|
|
|
59
|
|
|
—
|
|
|
59
|
|
|||||||
Other non-restructuring asset impairments
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||||
Cost reduction initiatives(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|||||||
Acquisition and expected separation costs (3)
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
26
|
|
|
27
|
|
||||||||
Process harmonization (4)
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|||||||
Purchase accounting adjustments (5)
|
—
|
|
|
—
|
|
|
2
|
|
|
1
|
|
|
3
|
|
|
—
|
|
|
3
|
|
|||||||
Warranty charge (6)
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
|
|
—
|
|
|
7
|
|
|||||||
Total adjustments
|
$
|
16
|
|
|
$
|
18
|
|
|
$
|
24
|
|
|
$
|
16
|
|
|
$
|
74
|
|
|
$
|
30
|
|
|
$
|
104
|
|
|
|
Reportable Segments
|
|
|
|
|
||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total
|
|
Corporate
|
|
Total
|
||||||||||||||
Six Months Ended June 30, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Restructuring charges, net
|
$
|
22
|
|
|
$
|
37
|
|
|
$
|
24
|
|
|
$
|
17
|
|
|
$
|
100
|
|
|
$
|
5
|
|
|
$
|
105
|
|
Restructuring related costs
|
—
|
|
|
—
|
|
|
30
|
|
|
3
|
|
|
33
|
|
|
1
|
|
|
34
|
|
|||||||
Inventory write-down(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
82
|
|
|
82
|
|
|
—
|
|
|
82
|
|
|||||||
Asset impairments restructuring related
|
—
|
|
|
3
|
|
|
—
|
|
|
25
|
|
|
28
|
|
|
—
|
|
|
28
|
|
|||||||
Other non-restructuring asset impairments
|
—
|
|
|
1
|
|
|
455
|
|
|
(1
|
)
|
|
455
|
|
|
17
|
|
|
472
|
|
|||||||
Acquisition and expected separation costs (2)
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
29
|
|
|
33
|
|
|||||||
Goodwill and intangibles impairment charge
|
—
|
|
|
160
|
|
|
113
|
|
|
110
|
|
|
383
|
|
|
—
|
|
|
383
|
|
|||||||
Total adjustments
|
$
|
26
|
|
|
$
|
201
|
|
|
$
|
622
|
|
|
$
|
236
|
|
|
$
|
1,085
|
|
|
$
|
52
|
|
|
$
|
1,137
|
|
|
|
Reportable Segments
|
|
|
|
|
||||||||||||||||||||||
|
Clean Air
|
|
Powertrain
|
|
Ride Performance
|
|
Motorparts
|
|
Total
|
|
Corporate
|
|
Total
|
||||||||||||||
Six Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Costs to achieve synergies (1)
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
3
|
|
Restructuring and related expenses
|
19
|
|
|
18
|
|
|
35
|
|
|
10
|
|
|
82
|
|
|
1
|
|
|
83
|
|
|||||||
Other non-restructuring asset impairments
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||||
Cost reduction initiatives (2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|
10
|
|
|||||||
Acquisition and expected separation costs (3)
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
66
|
|
|
67
|
|
|||||||
Process harmonization (4)
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
10
|
|
|
—
|
|
|
10
|
|
|||||||
Purchase accounting charges (5)
|
—
|
|
|
2
|
|
|
5
|
|
|
37
|
|
|
44
|
|
|
—
|
|
|
44
|
|
|||||||
Goodwill impairment charge (6)
|
—
|
|
|
—
|
|
|
60
|
|
|
—
|
|
|
60
|
|
|
—
|
|
|
60
|
|
|||||||
Warranty charge (7)
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
|
|
—
|
|
|
7
|
|
|||||||
Total adjustments
|
$
|
25
|
|
|
$
|
21
|
|
|
$
|
100
|
|
|
$
|
61
|
|
|
$
|
207
|
|
|
$
|
79
|
|
|
$
|
286
|
|
|
•
|
Temporarily suspending or reducing operations;
|
•
|
As discussed in more detail in Note 10, Debt and Other Financing Arrangements and below, we entered into an amendment to our senior credit facility to increase the maximum leverage ratio and decrease the minimum interest coverage ratio;
|
•
|
At June 30, 2020, we had liquidity of $1.4 billion comprised entirely of cash and we have fully utilized our $1.5 billion revolving credit facility;
|
•
|
For the second quarter of 2020, overall salary costs were reduced at least 25% through a combination of unpaid furloughs, net pay decreases, and available temporary support programs in all regions Tenneco does business. Additionally, the executive leadership team (the CEO and direct staff) had reduced their salaries by 50%-100%;
|
•
|
For the third quarter, overall salary costs will be reduced 10-20% through a combination of unpaid furloughs, net pay decreases, and temporary support programs in all regions we do business, subject to potential restorations or further reductions based on business conditions;
|
•
|
We reduced our headcount globally, and plan further reductions subject to negotiation with works councils in certain jurisdictions, beginning in the second quarter of 2020 and expect these actions to be completed during 2020. We recorded a charge of $92 million for the second quarter of 2020 in connection with cash severance costs expected to be paid;
|
•
|
Capital expenditures in 2020 are expected to approximate $380 million. This is a reduction from previous guidance of 2020 expenditures between $610 to $650 million and 2019 expenditures of more than $700 million;
|
•
|
Utilizing applicable and appropriate provisions under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) including deferral of our portion of the 2020 FICA payroll taxes which will be repaid in 2021 and 2022, payroll tax credits, and deferral of our U.S. qualified pension plan contributions;
|
•
|
The Tenneco Board of Directors annual retainer fees were reduced by 25% effective for the third quarter of 2020 and will be reduced for the remainder of year; and
|
•
|
In the second quarter of 2020, we deferred payments and extended payment terms with certain suppliers and other business partners to address the working capital issues described above, including delayed collections from customers of $150 million to $200 million, and accordingly deferred or delayed cash outlays as necessary and practical. These deferred payments approximated $235 million at the end of the second quarter of 2020.
|
|
Committed Credit Facilities
at June 30, 2020 |
||||
|
Term
|
|
Available(b)
|
||
Tenneco Inc. revolving credit facility (a)
|
2023
|
|
$
|
—
|
|
Tenneco Inc. Term Loan A
|
2023
|
|
—
|
|
|
Tenneco Inc. Term Loan B
|
2025
|
|
—
|
|
|
Subsidiaries’ credit agreements
|
2020 - 2028
|
|
—
|
|
|
|
|
|
$
|
—
|
|
|
(a)
|
We are required to pay commitment fees under the revolving credit facility on the unused portion of the total commitment.
|
(b)
|
Letters of credit reduce the available borrowings under the revolving credit facility.
|
Consolidated net leverage ratio
|
Interest rate
|
greater than 6.0 to 1
|
LIBOR plus 2.50%
|
less than 6.0 to 1 and greater than 4.5 to 1
|
LIBOR plus 2.25%
|
(i) Senior secured net leverage ratio
|
|
(ii) Consolidated net leverage ratio
|
||
not greater than 6.75 to 1
|
at June 30, 2020
|
|
not greater than 4.50 to 1
|
at March 31, 2020
|
not greater than 9.50 to 1
|
at September 30, 2020
|
|
not greater than 5.25 to 1
|
at March 31, 2022
|
not greater than 8.75 to 1
|
at December 31, 2020
|
|
not greater than 4.75 to 1
|
at June 30, 2022
|
not greater than 8.25 to 1
|
at March 31, 2021
|
|
not greater than 4.25 to 1
|
at September 30, 2022
|
not greater than 4.50 to 1
|
at June 30, 2021
|
|
not greater than 3.75 to 1
|
thereafter
|
not greater than 4.25 to 1
|
at September 30, 2021
|
|
|
|
not greater than 4.00 to 1
|
at December 31, 2021
|
|
|
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Borrowings on securitization programs
|
|
$
|
3
|
|
|
$
|
4
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Loss on sale of receivables(a)
|
$
|
4
|
|
|
$
|
6
|
|
|
$
|
10
|
|
|
$
|
14
|
|
|
|
Six Months Ended June 30,
|
||||||
|
2020
|
|
2019
|
||||
Operational cash flow before changes in operating assets and liabilities
|
$
|
(172
|
)
|
|
$
|
312
|
|
|
|
|
|
||||
Changes in operating assets and liabilities:
|
|
|
|
||||
Receivables
|
174
|
|
|
(401
|
)
|
||
Inventories
|
292
|
|
|
101
|
|
||
Payables and accrued expenses
|
(540
|
)
|
|
48
|
|
||
Accrued interest and accrued income taxes
|
(17
|
)
|
|
(66
|
)
|
||
Other assets and liabilities
|
(68
|
)
|
|
(94
|
)
|
||
Total change in operating assets and liabilities
|
(159
|
)
|
|
(412
|
)
|
||
Net cash (used) provided by operating activities
|
$
|
(331
|
)
|
|
$
|
(100
|
)
|
•
|
an increase in net cash used by operating activities before operating assets and liabilities of $484 million; and
|
•
|
a net decrease of $253 million in net cash used by operating activities due to favorable changes in working capital items, benefited by the deferral of approximately $235 million in accounts payable at June 30, 2020.
|
|
Six Months Ended June 30,
|
||||||
|
2020
|
|
2019
|
||||
Proceeds from sale of assets
|
$
|
5
|
|
|
$
|
5
|
|
Net proceeds from sale of business
|
—
|
|
|
22
|
|
||
Cash payments for property, plant, and equipment
|
(212
|
)
|
|
(379
|
)
|
||
Acquisitions, net of cash acquired
|
—
|
|
|
(158
|
)
|
||
Proceeds from deferred purchase price of factored receivables
|
91
|
|
|
147
|
|
||
Other
|
1
|
|
|
(1
|
)
|
||
Net cash (used) provided by investing activities
|
$
|
(115
|
)
|
|
$
|
(364
|
)
|
|
Six Months Ended June 30,
|
||||||
|
2020
|
|
2019
|
||||
Proceeds from term loans and notes
|
$
|
96
|
|
|
$
|
111
|
|
Repayments of term loans and notes
|
(133
|
)
|
|
(190
|
)
|
||
Debt issuance costs of long-term debt
|
(16
|
)
|
|
—
|
|
||
Borrowings on revolving lines of credit
|
4,821
|
|
|
4,525
|
|
||
Payments on revolving lines of credit
|
(3,536
|
)
|
|
(4,254
|
)
|
||
Issuance (repurchase) of common shares
|
(1
|
)
|
|
(2
|
)
|
||
Cash dividends
|
—
|
|
|
(20
|
)
|
||
Net increase (decrease) in bank overdrafts
|
59
|
|
|
(8
|
)
|
||
Other
|
(1
|
)
|
|
(1
|
)
|
||
Distributions to noncontrolling interest partners
|
(2
|
)
|
|
(20
|
)
|
||
Net cash (used) provided by financing activities
|
$
|
1,287
|
|
|
$
|
141
|
|
|
Six Months Ended June 30,
|
|
Year Ended December 31,
|
||||
|
2020
|
|
2019
|
||||
Net sales and operating revenues
|
$
|
2,654
|
|
|
$
|
6,390
|
|
Operating expenses
|
$
|
3,461
|
|
|
$
|
6,885
|
|
Net income (loss)
|
$
|
(762
|
)
|
|
$
|
(498
|
)
|
Net income (loss) attributable to Tenneco Inc.
|
$
|
(762
|
)
|
|
$
|
(498
|
)
|
|
June 30,
2020 |
|
December 31,
2019 |
||||
ASSETS
|
|
|
|
||||
Current assets
|
$
|
1,896
|
|
|
$
|
1,947
|
|
Non-current assets
|
$
|
2,666
|
|
|
$
|
3,089
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities
|
$
|
1,143
|
|
|
$
|
1,347
|
|
Non-current liabilities
|
$
|
7,354
|
|
|
$
|
6,102
|
|
Intercompany due to (due from)
|
$
|
(368
|
)
|
|
$
|
107
|
|
|
Notional Amount
|
||
Long positions
|
$
|
54
|
|
Short positions
|
$
|
(54
|
)
|
Period
|
Total Number of
Shares Purchased (1) |
|
Average
Price Paid |
|
Total Number
of Shares Purchased as Part of Publicly Announced Plans or Programs |
|
Maximum Value of
Shares That May Yet be Purchased Under These Plans or Programs (Millions) |
||||||
April 2020
|
999
|
|
|
$
|
7.43
|
|
|
—
|
|
|
$
|
—
|
|
May 2020
|
3,043
|
|
|
4.56
|
|
|
—
|
|
|
—
|
|
||
June 2020
|
754
|
|
|
7.60
|
|
|
—
|
|
|
—
|
|
||
Total
|
4,796
|
|
|
$
|
5.64
|
|
|
—
|
|
|
$
|
—
|
|
(1)
|
Shares withheld upon vesting of share settled restricted stock units in the second quarter of 2020.
|
Exhibit
Number
|
|
Description
|
|
|
|
—
|
Certificate of Designations of Series A Preferred Stock of Tenneco Inc. (incorporated herein by reference to Exhibit 3.1 of the registrant’s Current Report on Form 8-K dated April 16, 2020, File No 1-12387).
|
|
|
|
|
—
|
Section 382 Rights Agreement, dated as of April 15, 2020, between Tenneco Inc. and Equiniti Trust Company, as rights agent (incorporated herein by reference to Exhibit 4.1 of the registrant’s Current Report on Form 8-K dated April 16, 2020, File No 1-12387).
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|
|
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|
+10.5
|
—
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Tenneco Inc. 2006 Long-Term Incentive Plan, as amended and restated effective March 10, 2020 (incorporated by reference to Appendix A of Tenneco’s Definitive Proxy Statement filed on April 1, 2020).
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*31.1
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—
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Certification of Brian J. Kesseler under Section 302 of the Sarbanes-Oxley Act of 2002.
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*31.2
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—
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Certification of Kenneth R. Trammell under Section 302 of the Sarbanes-Oxley Act of 2002.
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*32.1
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—
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Certification of Brian J. Kesseler and Kenneth R. Trammell under Section 906 of the Sarbanes-Oxley Act of 2002.
|
*101.INS
|
—
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Inline XBRL Instance Document. The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document.
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*101.SCH
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—
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Inline XBRL Taxonomy Extension Schema Document.
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*101.CAL
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—
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Inline XBRL Taxonomy Extension Calculation Linkbase Document.
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*101.DEF
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—
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Inline XBRL Taxonomy Extension Definition Linkbase Document.
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*101.LAB
|
—
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Inline XBRL Taxonomy Extension Label Linkbase Document.
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*101.PRE
|
—
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Inline XBRL Taxonomy Extension Presentation Linkbase Document.
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|
104
|
—
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
|
*
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Filed herewith.
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+
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Indicates a management contract or compensatory plan or arrangement
|
TENNECO INC.
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||
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By:
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/s/ KENNETH R. TRAMMELL
|
|
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Kenneth R. Trammell
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Interim Executive Vice President and Chief Financial
Officer (on behalf of the Registrant)
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|
|
TENNECO INC.
|
||
|
|
|
By:
|
|
/s/ JOHN S. PATOUHAS
|
|
|
John S. Patouhas
|
|
|
Vice President and Chief Accounting Officer (principal accounting officer)
|
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|
1 Year Tenneco Chart |
1 Month Tenneco Chart |
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