Ashland Global Holdings Inc. and Consolidated Subsidiaries | Table 1 |
STATEMENTS OF CONSOLIDATED INCOME (LOSS) | |
(In millions except per share data - preliminary and unaudited) |
Three months ended | |||||||
December 31, | |||||||
2020 | 2019 | ||||||
Sales | $ | 552 | $ | 533 | |||
Cost of sales | 374 | 380 | |||||
GROSS PROFIT | 178 | 153 | |||||
Selling, general and administrative expense | 106 | 99 | |||||
Research and development expense | 15 | 16 | |||||
Intangibles amortization expense | 21 | 21 | |||||
Equity and other income | 5 | - | |||||
OPERATING INCOME | 41 | 17 | |||||
Net interest and other expense (income) | (6) | 10 | |||||
Net income on divestitures | 14 | 3 | |||||
INCOME FROM CONTINUING OPERATIONS | |||||||
BEFORE INCOME TAXES | 61 | 10 | |||||
Income tax expense (benefit) | - | (24) | |||||
INCOME FROM CONTINUING OPERATIONS | 61 | 34 | |||||
Loss from discontinued operations (net of income taxes) | (5) | (2) | |||||
NET INCOME | $ | 56 | $ | 32 | |||
DILUTED EARNINGS PER SHARE | |||||||
Income from continuing operations | $ | 0.99 | $ | 0.56 | |||
Income (loss) from discontinued operations | (0.08) | (0.03) | |||||
Net income | $ | 0.91 | $ | 0.53 | |||
AVERAGE DILUTED COMMON SHARES OUTSTANDING | 61 | 61 | |||||
SALES | |||||||
Life Sciences | 170 | 155 | |||||
Personal Care and Household | 126 | 137 | |||||
Consumer Specialties | 296 | 292 | |||||
Specialty Additives | 147 | 139 | |||||
Performance Adhesives | 84 | 74 | |||||
Industrial Specialties | 231 | 213 | |||||
Intermediates & Solvents | 33 | 28 | |||||
Intersegment Sales | (8) | - | |||||
$ | 552 | $ | 533 | ||||
OPERATING INCOME (LOSS) | |||||||
Life Sciences | 29 | 22 | |||||
Personal Care and Household | 15 | 11 | |||||
Consumer Specialties | 44 | 33 | |||||
Specialty Additives | 2 | 9 | |||||
Performance Adhesives | 20 | 10 | |||||
Industrial Specialties | 22 | 19 | |||||
Intermediates & Solvents | 2 | (12) | |||||
Unallocated and other | (27) | (23) | |||||
$ | 41 | $ | 17 | ||||
Ashland Global Holdings Inc. and Consolidated Subsidiaries | Table 2 | ||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
(In millions - preliminary and unaudited) | |||||||
December 31 | September 30 | ||||||
2020 | 2020 | ||||||
ASSETS | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 335 | $ | 454 | |||
Accounts receivable | 409 | 471 | |||||
Inventories | 537 | 529 | |||||
Other assets | 100 | 87 | |||||
Held for sale | - | 6 | |||||
Total current assets | 1,381 | 1,547 | |||||
Noncurrent assets | |||||||
Property, plant and equipment | |||||||
Cost | 3,310 | 3,265 | |||||
Accumulated depreciation | 1,748 | 1,700 | |||||
Net property, plant and equipment | 1,562 | 1,565 | |||||
Goodwill | 1,792 | 1,758 | |||||
Intangibles | 1,001 | 1,013 | |||||
Operating lease assets, net | 137 | 137 | |||||
Restricted investments | 316 | 301 | |||||
Asbestos insurance receivable | 130 | 136 | |||||
Deferred income taxes | 26 | 26 | |||||
Other assets | 397 | 394 | |||||
Total noncurrent assets | 5,361 | 5,330 | |||||
Total assets | $ | 6,742 | $ | 6,877 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities | |||||||
Short-term debt | $ | 93 | $ | 280 | |||
Trade and other payables | 217 | 233 | |||||
Accrued expenses and other liabilities | 252 | 277 | |||||
Current operating lease obligations | 23 | 23 | |||||
Total current liabilities | 585 | 813 | |||||
Noncurrent liabilities | |||||||
Long-term debt | 1,601 | 1,573 | |||||
Asbestos litigation reserve | 498 | 513 | |||||
Deferred income taxes | 222 | 229 | |||||
Employee benefit obligations | 157 | 157 | |||||
Operating lease obligations | 124 | 124 | |||||
Other liabilities | 433 | 432 | |||||
Total noncurrent liabilities | 3,035 | 3,028 | |||||
Stockholders' equity | 3,122 | 3,036 | |||||
Total liabilities and stockholders' equity | $ | 6,742 | $ | 6,877 | |||
Ashland Global Holdings Inc. and Consolidated Subsidiaries | Table 3 | ||||||
STATEMENTS OF CONSOLIDATED CASH FLOWS | |||||||
(In millions - preliminary and unaudited) | |||||||
Three months ended | |||||||
December 31 | |||||||
2020 | 2019 | ||||||
CASH FLOWS PROVIDED (USED) BY OPERATING ACTIVITIES | |||||||
FROM CONTINUING OPERATIONS | |||||||
Net income (loss) | $ | 56 | $ | 32 | |||
Loss from discontinued operations (net of taxes) | 5 | 2 | |||||
Adjustments to reconcile income from continuing operations to | |||||||
cash flows from operating activities | |||||||
Depreciation and amortization | 62 | 61 | |||||
Original issue discount and debt issuance cost amortization | 1 | 2 | |||||
Deferred income taxes | (5 ) | (12 ) | |||||
Gain from sales of property and equipment | (4 ) | - | |||||
Stock based compensation expense | 4 | 4 | |||||
Income from restricted investments | (23 ) | (13 ) | |||||
Net income on divestitures | (14 ) | - | |||||
Impairments | 9 | - | |||||
Pension contributions | (2 ) | (1 ) | |||||
Change in operating assets and liabilities (a) | 17 | (109 ) | |||||
Total cash flows provided (used) by operating activities from continuing operations | 106 | (34 ) | |||||
CASH FLOWS PROVIDED (USED) BY INVESTING ACTIVITIES | |||||||
FROM CONTINUING OPERATIONS | |||||||
Additions to property, plant and equipment | (30 ) | (29 ) | |||||
Proceeds from disposal of property, plant and equipment | 5 | - | |||||
Proceeds from sale or restructuring of operations | 14 | - | |||||
Net purchase of funds restricted for specific transactions | (1 ) | (1 ) | |||||
Reimbursements from restricted investments | 8 | 10 | |||||
Proceeds from sale of securities | 42 | 4 | |||||
Purchases of securities | (42 ) | (4 ) | |||||
Total cash flows used by investing activities from continuing operations | (4 ) | (20 ) | |||||
CASH FLOWS PROVIDED (USED) BY FINANCING ACTIVITIES | |||||||
FROM CONTINUING OPERATIONS | |||||||
Proceeds from (repayment of) short-term debt | (187 ) | 14 | |||||
Cash dividends paid | (17 ) | (16 ) | |||||
Stock based compensation employee withholding taxes paid in cash | (3 ) | (5 ) | |||||
Total cash flows used by financing activities from continuing operations | (207 ) | (7 ) | |||||
CASH PROVIDED (USED) BY CONTINUING OPERATIONS | (105 ) | (61 ) | |||||
Cash provided (used) by discontinued operations | |||||||
Operating cash flows | (14 ) | (17 ) | |||||
Investing cash flows | (3 ) | 2 | |||||
Effect of currency exchange rate changes on cash and cash equivalents | 3 | 1 | |||||
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (119 ) | (75 ) | |||||
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 454 | 232 | |||||
CASH AND CASH EQUIVALENTS - END OF PERIOD | $ | 335 | $ | 157 | |||
DEPRECIATION AND AMORTIZATION | |||||||
Life Sciences | 16 | 15 | |||||
Personal Care and Household | 19 | 19 | |||||
Consumer Specialties | 35 | 34 | |||||
Specialty Additives | 21 | 20 | |||||
Performance Adhesives | 3 | 4 | |||||
Industrial Specialties | 24 | 24 | |||||
Intermediates & Solvents | 3 | 3 | |||||
Unallocated and other | - | - | |||||
$ | 62 | $ | 61 | ||||
(a) Excludes changes resulting from operations acquired or sold.
Ashland Global Holdings Inc. and Consolidated Subsidiaries | Table 4 |
RECONCILIATION OF NON-GAAP DATA - ADJUSTED EBITDA | |
(In millions - preliminary and unaudited) |
Three months ended | ||||||||
December 31 | ||||||||
Adjusted EBITDA - Ashland Global Holdings Inc. | 2020 | 2019 | ||||||
Net income | $ | 56 | $ | 32 | ||||
Income tax expense (benefit) | - | (24) | ||||||
Net interest and other expense (income) | (6) | 10 | ||||||
Depreciation and amortization | 62 | 61 | ||||||
EBITDA | 112 | 79 | ||||||
Loss from discontinued operations (net of taxes) | 5 | 2 | ||||||
Net income on divestitures key items (see Table 5) | (14) | - | ||||||
Operating key items (see Table 5) | 21 | 7 | ||||||
Adjusted EBITDA | $ | 124 | $ | 88 | ||||
Life Sciences | ||||||||
Operating income | $ | 29 | $ | 22 | ||||
Add: | ||||||||
Depreciation and amortization | 16 | 15 | ||||||
Adjusted EBITDA | $ | 45 | $ | 37 | ||||
Personal Care and Household | ||||||||
Operating income | $ | 15 | $ | 11 | ||||
Add: | ||||||||
Depreciation and amortization | 19 | 19 | ||||||
Adjusted EBITDA | $ | 34 | $ | 30 | ||||
Adjusted EBITDA - Consumer Specialties Total | ||||||||
Operating income | $ | 44 | $ | 33 | ||||
Add: | ||||||||
Depreciation and amortization | 35 | 34 | ||||||
Adjusted EBITDA | $ | 79 | $ | 67 | ||||
Ashland Global Holdings Inc. and Consolidated Subsidiaries
RECONCILIATION OF NON-GAAP DATA - ADJUSTED EBITDA (In millions - preliminary and unaudited)
Table 4 (Continued)
Three months ended
December 31
2020 | 2019 | ||||||
Specialty Additives | |||||||
Operating income | $ | 2 | $ | 9 | |||
Add: | |||||||
Depreciation and amortization | 21 | 20 | |||||
Operating key items (see Table 5) | 9 | - | |||||
Adjusted EBITDA | $ | 32 | $ | 29 | |||
Performance Adhesives | |||||||
Operating income | $ | 20 | $ | 10 | |||
Add: | |||||||
Depreciation and amortization | 3 | 4 | |||||
Adjusted EBITDA | $ | 23 | $ | 14 | |||
Adjusted EBITDA - Industrial Specialties Total | |||||||
Operating income | $ | 22 | $ | 19 | |||
Add: | |||||||
Depreciation and amortization | 24 | 24 | |||||
Operating key items (see Table 5) | 9 | - | |||||
Adjusted EBITDA | $ | 55 | $ | 43 | |||
Adjusted EBITDA - Intermediates and Solvents | |||||||
Operating income | $ | 2 | $ | (12) | |||
Add: | |||||||
Depreciation and amortization | 3 | 3 | |||||
Adjusted EBITDA | $ | 5 | $ | (9) | |||
Ashland Global Holdings Inc. and Consolidated Subsidiaries | Table 5 | |||||||||||||||||||||||||||
SEGMENT COMPONENTS OF KEY ITEMS FOR APPLICABLE INCOME STATEMENT CAPTIONS | ||||||||||||||||||||||||||||
(In millions - preliminary and unaudited) | ||||||||||||||||||||||||||||
Three Months Ended December 31, 2020 | ||||||||||||||||||||||||||||
Personal | ||||||||||||||||||||||||||||
Care | ||||||||||||||||||||||||||||
Life | and | Consumer | Specialty | Performance | Industrial | Intermediates | Unallocated | |||||||||||||||||||||
Sciences | Household | Specialties | Additives | Adhesives | Specialties | and Solvents | & Other | Total | ||||||||||||||||||||
OPERATING INCOME (LOSS) | ||||||||||||||||||||||||||||
Operating key items: | ||||||||||||||||||||||||||||
Restructuring, separation and other costs | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | (12 ) | $ | (12 ) | ||||||||||
Capital project impairment | - | - | - | (9 ) | - | (9 ) | - | - | (9 ) | |||||||||||||||||||
All other operating income (loss) | 29 | 15 | 44 | 11 | 20 | 31 | 2 | (15 ) | 62 | |||||||||||||||||||
Operating income (loss) | 29 | 15 | 44 | 2 | 20 | 22 | 2 | (27 ) | 41 | |||||||||||||||||||
NET INTEREST AND OTHER EXPENSE (INCOME) | ||||||||||||||||||||||||||||
Key items | (18 ) | (18 ) | ||||||||||||||||||||||||||
All other net interest and other expense (income) | 12 | 12 | ||||||||||||||||||||||||||
(6 ) | (6 ) | |||||||||||||||||||||||||||
NET INCOME ON DIVESTITURES | ||||||||||||||||||||||||||||
Key items | 14 | 14 | ||||||||||||||||||||||||||
INCOME TAX EXPENSE (BENEFIT) | ||||||||||||||||||||||||||||
Tax effect of key items (a) | 4 | 4 | ||||||||||||||||||||||||||
Tax specific key items (b) | (13 ) | (13 ) | ||||||||||||||||||||||||||
All other income tax expense (benefit) | 9 | 9 | ||||||||||||||||||||||||||
- | - | |||||||||||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS | $ | 29 | $ | 15 | $ | 44 | $ | 2 | $ | 20 | $ | 22 | $ | 2 | $ | (7 ) | $ | 61 | ||||||||||
Three Months Ended December 31, 2019 | ||||||||||||||||||||||||||||
Personal | ||||||||||||||||||||||||||||
Care | ||||||||||||||||||||||||||||
Life | and | Consumer | Specialty | Performance | Industrial | Intermediates | Unallocated | |||||||||||||||||||||
Sciences | Household | Specialties | Additives | Adhesives | Specialties | and Solvents | & Other | Total | ||||||||||||||||||||
OPERATING INCOME (LOSS) | ||||||||||||||||||||||||||||
Operating key items: | ||||||||||||||||||||||||||||
Restructuring, separation and other costs | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | (7 ) | $ | (7 ) | ||||||||||
All other operating income (loss) | 22 | 11 | 33 | 9 | 10 | 19 | (12 ) | (16 ) | 24 | |||||||||||||||||||
Operating income (loss) | 22 | 11 | 33 | 9 | 10 | 19 | (12 ) | (23 ) | 17 | |||||||||||||||||||
NET INTEREST AND OTHER EXPENSE (INCOME) | ||||||||||||||||||||||||||||
Key items | (9 ) | (9 ) | ||||||||||||||||||||||||||
All other net interest and other expense (income) | 19 | 19 | ||||||||||||||||||||||||||
10 | 10 | |||||||||||||||||||||||||||
NET INCOME ON DIVESTITURES | 3 | 3 | ||||||||||||||||||||||||||
INCOME TAX EXPENSE (BENEFIT) | ||||||||||||||||||||||||||||
Tax effect of key items (a) | 1 | 1 | ||||||||||||||||||||||||||
Tax specific key items (b) | (25 ) | (25 ) | ||||||||||||||||||||||||||
All other income tax expense (benefit) | - | - | ||||||||||||||||||||||||||
(24 ) | (24 ) | |||||||||||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS | $ | 22 | $ | 11 | $ | 33 | $ | 9 | $ | 10 | $ | 19 | $ | (12 ) | $ | (6 ) | $ | 34 | ||||||||||
- Represents the tax effect of the key items that are previously identified above.
- Represents key items resulting from tax specific financial transactions, tax law changes or other matters that fall within the definition of tax specific key items. See Table 7 for additional information.
Ashland Global Holdings Inc. and Consolidated Subsidiaries | Table 6 | ||||||
RECONCILIATION OF CERTAIN NON-GAAP DATA | |||||||
(In millions - preliminary and unaudited) | |||||||
Three months ended | |||||||
December 31 | |||||||
Free cash flows (a) | 2020 | 2019 | |||||
Total cash flows provided by operating activities from | |||||||
continuing operations | $ | 106 | $ | (34) | |||
Adjustments: | |||||||
Additions to property, plant and equipment | (30) | (29) | |||||
Free cash flows (a) (b) | $ | 76 | $ | (63) | |||
- Free cash flow is defined as cash flows provided (used) by operating activities less additions to property, plant and equipment and other items Ashland has deemed non-operational (if applicable).
- Includes $14 million and $6 million of restructuring payments for the three months ended December 31, 2020 and 2019, respectively.
Three months ended | ||||||
December 31 | ||||||
Adjusted operating income | 2020 | 2019 | ||||
Operating income (as reported) | $ | 41 | $ | 17 | ||
Key items, before tax: | ||||||
Restructuring, separation and other costs | 12 | 7 | ||||
Capital project impairment | 9 | - | ||||
Adjusted operating income (non-GAAP) | $ | 62 | $ | 24 | ||
11
Ashland Global Holdings Inc. and Consolidated Subsidiaries | Table 7 | |||||
RECONCILIATION OF CERTAIN NON-GAAP DATA | ||||||
(In millions except per share data - preliminary and unaudited) | ||||||
Three months ended | ||||||
December 31 | ||||||
2020 | 2019 | |||||
Income from continuing operations (as reported) | $ | 61 | $ | 34 | ||
Key items, before tax: | ||||||
Restructuring, separation and other costs | 12 | 7 | ||||
Capital project impairment | 9 | - | ||||
Unrealized gain on securities | (18) | (9) | ||||
Net gain on acquisitions and divestitures | (14) | - | ||||
Key items, before tax | (11) | (2) | ||||
Tax effect of key items (a) | 4 | 1 | ||||
Key items, after tax | (7) | (1) | ||||
Tax specific key items: | ||||||
Restructuring and separation activity | (13) | - | ||||
Other tax reform related activity | - | (25) | ||||
Tax specific key items (b) | (13) | (25) | ||||
Total key items | (20) | (26) | ||||
Adjusted income from continuing operations (non-GAAP) | $ | 41 | $ | 8 | ||
Amortization expense adjustment (net of tax) (c) | 17 | 17 | ||||
Adjusted income from continuing operations (non-GAAP) excluding intangibles amortization expense | $ | 58 | $ | 25 | ||
- Represents the tax effect of the key items that are previously identified above.
- Represents key items resulting from tax specific financial transactions, tax law changes or other matters that fall within the definition of tax specific key items. These tax specific key items included the following:
- Restructuring and separation activity: Includes the impact from company-wide restructuring activities. These adjustments related to various tax impacts including state tax costs, foreign tax costs and other tax account adjustments.
- Other tax reform: Includes the impact of other items related to the Tax Act and other tax law changes enacted during 2020.
- Amortization expense adjustment (net of tax) tax rates were 21% and 20% for the three months ended December 31, 2020 and 2019, respectively.
12
Ashland Global Holdings Inc. and Consolidated Subsidiaries | Table 7 (Continued) | |||||
RECONCILIATION OF CERTAIN NON-GAAP DATA | ||||||
(In millions except per share data - preliminary and unaudited) | ||||||
Three months ended | ||||||
December 31 | ||||||
2020 | 2019 | |||||
Diluted EPS from continuing operations (as reported) | $ | 0.99 | $ | 0.56 | ||
Key items, before tax: | ||||||
Restructuring, separation and other costs | 0.18 | 0.12 | ||||
Capital project impairment | 0.16 | - | ||||
Unrealized gain on securities | (0.29) | (0.15) | ||||
Net gain on acquisitions and divestitures | (0.23) | - | ||||
Key items, before tax | (0.18) | (0.03) | ||||
Tax effect of key items (a) | 0.07 | 0.02 | ||||
Key items, after tax | (0.11) | (0.01) | ||||
Tax specific key items: | ||||||
Restructuring and separation activity | (0.22) | - | ||||
Other tax reform related activity | - | (0.42) | ||||
Tax specific key items (b) | (0.22) | (0.42) | ||||
Total key items | (0.33) | (0.43) | ||||
Adjusted diluted EPS from continuing operations (non-GAAP) | $ | 0.66 | $ | 0.13 | ||
Amortization expense adjustment (net of tax) (c) | 0.28 | 0.28 | ||||
Adjusted diluted EPS from continuing operations (non-GAAP) excluding intangibles amortization expense | $ | 0.94 | $ | 0.41 | ||
- Represents the tax effect of the key items that are previously identified above.
- Represents key items resulting from tax specific financial transactions, tax law changes or other matters that fall within the definition of tax specific key items. These tax specific key items included the following:
- Restructuring and separation activity: Includes the impact from company-wide restructuring activities. These adjustments related to various tax impacts including state tax costs, foreign tax costs and other tax account adjustments.
- Other tax reform: Includes the impact of other items related to the Tax Act and other tax law changes enacted during 2020.
- Amortization expense adjustment (net of tax) tax rates were 21% and 20% for the three months ended December 31, 2020 and 2019, respectively.
13
Attachments
- Original document
- Permalink
Disclaimer
Ashland Global Holdings Inc. published this content on 03 February 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 03 February 2021 22:11:12 UTC.