Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Aug. 05, 2019 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-36473 | |
Entity Registrant Name | Trinseo S.A. | |
Entity Incorporation, State or Country Code | N4 | |
Entity Tax Identification Number | 00-0000000 | |
Entity Address, Address Line One | 1000 Chesterbrook Boulevard | |
Entity Address, Address Line Two | Suite 300 | |
Entity Address, Address Line Three | Berwyn | |
Entity Address, City or Town | Berwyn, PA 19312 | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 19312 | |
City Area Code | 610 | |
Local Phone Number | 240-3200 | |
Title of 12(b) Security | Ordinary Shares, par value $0.01 per share | |
Trading Symbol | TSE | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 40,200,697 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0001519061 | |
Current Fiscal Year End Date | --12-31 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Current assets | ||
Cash and cash equivalents | $ 534.9 | $ 452.3 |
Accounts receivable, net of allowance for doubtful accounts (June 30, 2019: $5.1; December 31, 2018: $6.1) | 619.8 | 648.1 |
Inventories | 458.5 | 510.4 |
Other current assets | 25.3 | 20.5 |
Total current assets | 1,638.5 | 1,631.3 |
Investments in unconsolidated affiliates | 199.1 | 179.1 |
Property, plant and equipment, net of accumulated depreciation (June 30, 2019: $632.7; December 31, 2018: $590.6) | 574.3 | 592.1 |
Other assets | ||
Goodwill | 68.7 | 69 |
Other intangible assets, net | 185.2 | 191.1 |
Deferred income tax assets | 29.3 | 26.7 |
Deferred charges and other assets | 38.3 | 37.5 |
Right of use assets - operating | 70.8 | |
Total other assets | 392.3 | 324.3 |
Total assets | 2,804.2 | 2,726.8 |
Current liabilities | ||
Short-term borrowings and current portion of long-term debt | 8.7 | 7 |
Accounts payable | 394.9 | 354.2 |
Income taxes payable | 4.5 | 16 |
Accrued expenses and other current liabilities | 155.5 | 159.8 |
Current lease liabilities - operating | 15.5 | |
Total current liabilities | 579.1 | 537 |
Noncurrent liabilities | ||
Long-term debt, net of unamortized deferred financing fees | 1,160.5 | 1,160.8 |
Deferred income tax liabilities | 49.2 | 45.4 |
Other noncurrent obligations | 214.7 | 214.9 |
Noncurrent lease liabilities - operating | 55.6 | |
Total noncurrent liabilities | 1,480 | 1,421.1 |
Commitments and contingencies (Note 11) | ||
Shareholders' equity | ||
Ordinary shares, $0.01 nominal value, 50,000.0 shares authorized (June 30, 2019: 48.8 shares issued and 40.6 shares outstanding; December 31, 2018: 48.8 shares issued and 41.6 shares outstanding) | 0.5 | 0.5 |
Additional paid-in-capital | 571.2 | 575.4 |
Treasury shares, at cost (June 30, 2019: 8.2 shares; December 31, 2018: 7.2 shares) | (465.1) | (418.1) |
Retained earnings | 784.1 | 753.2 |
Accumulated other comprehensive loss | (145.6) | (142.3) |
Total shareholders' equity | 745.1 | 768.7 |
Total liabilities and shareholders' equity | $ 2,804.2 | $ 2,726.8 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Condensed Consolidated Balance Sheets | ||
Allowance for doubtful accounts | $ 5.1 | $ 6.1 |
Accumulated depreciation | $ 632.7 | $ 590.6 |
Ordinary shares, nominal value | $ 0.01 | $ 0.01 |
Ordinary shares, shares authorized | 50,000,000,000 | 50,000,000,000 |
Ordinary shares, shares issued | 48,800,000 | 48,800,000 |
Ordinary shares, shares outstanding | 40,600,000 | 41,600,000 |
Treasury stock, shares | 8,200,000 | 7,200,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Condensed Consolidated Statements of Operations | ||||
Net sales | $ 951.8 | $ 1,236.6 | $ 1,964.9 | $ 2,358.1 |
Cost of sales | 865.6 | 1,073.9 | 1,781.2 | 2,020.2 |
Gross profit | 86.2 | 162.7 | 183.7 | 337.9 |
Selling, general and administrative expenses | 71.4 | 61.7 | 140.3 | 126.1 |
Equity in earnings of unconsolidated affiliates | 40.3 | 33.2 | 72.5 | 78.8 |
Operating income | 55.1 | 134.2 | 115.9 | 290.6 |
Interest expense, net | 9.9 | 10.8 | 20.1 | 25.7 |
Loss on extinguishment of long-term debt | 0.2 | 0.2 | ||
Other expense, net | 1.5 | 4.5 | 5.5 | 0.8 |
Income before income taxes | 43.7 | 118.7 | 90.3 | 263.9 |
Provision for income taxes | 15.7 | 20.4 | 26.5 | 45.3 |
Net income | $ 28 | $ 98.3 | $ 63.8 | $ 218.6 |
Weighted average shares- basic | 40.8 | 43.1 | 41 | 43.3 |
Net income (loss) per share- basic | $ 0.69 | $ 2.28 | $ 1.56 | $ 5.05 |
Weighted average shares- diluted | 41.1 | 43.8 | 41.5 | 44.2 |
Net income (loss) per share- diluted | $ 0.68 | $ 2.24 | $ 1.54 | $ 4.95 |
Dividends on ordinary shares | $ 0.40 | $ 0.36 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Condensed Consolidated Statements of Comprehensive Income (Loss) | ||||
Net income | $ 28 | $ 98.3 | $ 63.8 | $ 218.6 |
Other comprehensive income (loss), net of tax | ||||
Cumulative translation adjustments | 3 | (16.1) | 2.7 | (18.2) |
Net gain on cash flow hedges post adoption | (5.4) | 11.9 | (5.3) | 14.7 |
Pension and other postretirement benefit plans: | ||||
Net loss arising during period (net of tax of: $0.0, $0.0, $0.2, and $0.0) | (2) | |||
Amounts reclassified from accumulated other comprehensive income | 0.3 | 0.6 | 1.3 | 1.2 |
Total other comprehensive income (loss), net of tax | (2.1) | (3.6) | (3.3) | (2.3) |
Comprehensive income | $ 25.9 | $ 94.7 | $ 60.5 | $ 216.3 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Condensed Consolidated Statements of Comprehensive Income (Loss) | ||||
Net loss arising during period, tax (benefit) expense | $ 0 | $ 0 | $ 0.2 | $ 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Shareholders' Equity - USD ($) shares in Millions, $ in Millions | Ordinary Shares | Additional Paid-In Capital | Treasury Shares | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Total |
Balance at beginning of period at Dec. 31, 2017 | $ 0.5 | $ 578.8 | $ (286.8) | $ (145.6) | $ 527.9 | $ 674.8 |
Balance at beginning of period, shares at Dec. 31, 2017 | 43.4 | 5.4 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 120.3 | 120.3 | ||||
Other comprehensive loss | 1.3 | 1.3 | ||||
Stock-based compensation | (12.2) | $ 11.5 | (0.7) | |||
Stock-based compensation, shares | 0.3 | (0.3) | ||||
Purchase of treasury shares | $ (24.2) | (24.2) | ||||
Purchase of treasury shares, shares | (0.3) | 0.3 | ||||
Dividends on ordinary shares | (15.8) | (15.8) | ||||
Balance at end of period at Mar. 31, 2018 | $ 0.5 | 566.6 | $ (299.5) | (144.3) | 632.4 | 755.7 |
Balance at end of period, shares at Mar. 31, 2018 | 43.4 | 5.4 | ||||
Balance at beginning of period at Dec. 31, 2017 | $ 0.5 | 578.8 | $ (286.8) | (145.6) | 527.9 | 674.8 |
Balance at beginning of period, shares at Dec. 31, 2017 | 43.4 | 5.4 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 218.6 | |||||
Other comprehensive loss | (2.3) | |||||
Balance at end of period at Jun. 30, 2018 | $ 0.5 | 569.1 | $ (333.3) | (147.9) | 713.4 | 801.8 |
Balance at end of period, shares at Jun. 30, 2018 | 43 | 5.8 | ||||
Balance at beginning of period at Mar. 31, 2018 | $ 0.5 | 566.6 | $ (299.5) | (144.3) | 632.4 | 755.7 |
Balance at beginning of period, shares at Mar. 31, 2018 | 43.4 | 5.4 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 98.3 | 98.3 | ||||
Other comprehensive loss | (3.6) | (3.6) | ||||
Stock-based compensation | 2.5 | $ 1.2 | 3.7 | |||
Stock-based compensation, shares | 0.1 | (0.1) | ||||
Purchase of treasury shares | $ (35) | (35) | ||||
Purchase of treasury shares, shares | (0.5) | 0.5 | ||||
Dividends on ordinary shares | (17.3) | (17.3) | ||||
Balance at end of period at Jun. 30, 2018 | $ 0.5 | 569.1 | $ (333.3) | (147.9) | 713.4 | 801.8 |
Balance at end of period, shares at Jun. 30, 2018 | 43 | 5.8 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Adoption of new accounting standard | 0 | |||||
Balance at beginning of period at Dec. 31, 2018 | $ 0.5 | 575.4 | $ (418.1) | (142.3) | 753.2 | $ 768.7 |
Balance at beginning of period, shares at Dec. 31, 2018 | 41.6 | 7.2 | 41.6 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 35.8 | $ 35.8 | ||||
Other comprehensive loss | (1.2) | (1.2) | ||||
Stock-based compensation | (6.6) | $ 7 | 0.4 | |||
Stock-based compensation, shares | 0.1 | (0.1) | ||||
Purchase of treasury shares | $ (34) | (34) | ||||
Purchase of treasury shares, shares | (0.7) | 0.7 | ||||
Dividends on ordinary shares | (16.6) | (16.6) | ||||
Balance at end of period at Mar. 31, 2019 | $ 0.5 | 568.8 | $ (445.1) | (143.5) | 772.4 | 753.1 |
Balance at end of period, shares at Mar. 31, 2019 | 41 | 7.8 | ||||
Balance at beginning of period at Dec. 31, 2018 | $ 0.5 | 575.4 | $ (418.1) | (142.3) | 753.2 | $ 768.7 |
Balance at beginning of period, shares at Dec. 31, 2018 | 41.6 | 7.2 | 41.6 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | $ 63.8 | |||||
Other comprehensive loss | (3.3) | |||||
Balance at end of period at Jun. 30, 2019 | $ 0.5 | 571.2 | $ (465.1) | (145.6) | 784.1 | $ 745.1 |
Balance at end of period, shares at Jun. 30, 2019 | 40.6 | 8.2 | 40.6 | |||
Balance at beginning of period at Mar. 31, 2019 | $ 0.5 | 568.8 | $ (445.1) | (143.5) | 772.4 | $ 753.1 |
Balance at beginning of period, shares at Mar. 31, 2019 | 41 | 7.8 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 28 | 28 | ||||
Other comprehensive loss | (2.1) | (2.1) | ||||
Stock-based compensation | 2.4 | $ 1.7 | 4.1 | |||
Stock-based compensation, shares | 0.1 | (0.1) | ||||
Purchase of treasury shares | $ (21.7) | (21.7) | ||||
Purchase of treasury shares, shares | (0.5) | 0.5 | ||||
Dividends on ordinary shares | (16.3) | (16.3) | ||||
Balance at end of period at Jun. 30, 2019 | $ 0.5 | $ 571.2 | $ (465.1) | $ (145.6) | $ 784.1 | $ 745.1 |
Balance at end of period, shares at Jun. 30, 2019 | 40.6 | 8.2 | 40.6 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Shareholders' Equity (Parenthetical)) - $ / shares | 3 Months Ended | |||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | |
Condensed Consolidated Statement of Stockholders' Equity | ||||
Dividends on ordinary shares | $ 0.40 | $ 0.40 | $ 0.36 | $ 0.36 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities | ||
Net income | $ 63.8 | $ 218.6 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 68.7 | 64.3 |
Amortization of deferred financing fees, issuance discount, and excluded component of hedging instruments | (0.2) | 0.9 |
Deferred income tax | 0.3 | 0.4 |
Share-based compensation expense | 7.7 | 8.9 |
Earnings of unconsolidated affiliates, net of dividends | (20) | (11.3) |
Unrealized net (gain) loss on foreign exchange forward contracts | 5.5 | (7.7) |
Loss on extinguishment of long-term debt | 0.2 | |
Gain on sale of businesses and other assets | (0.2) | (0.5) |
Impairment charges | 0.4 | |
Pension curtailment and settlement loss | 0.7 | |
Changes in assets and liabilities | ||
Accounts receivable | 24.1 | (83) |
Inventories | 50.7 | (31) |
Accounts payable and other current liabilities | 45.1 | 31.8 |
Income taxes payable | (11.2) | (20.2) |
Other assets, net | 1 | (3.7) |
Other liabilities, net | (2) | 14.3 |
Cash provided by operating activities | 234 | 182.4 |
Cash flows from investing activities | ||
Capital expenditures | (47.6) | (59.5) |
Proceeds from capital expenditures subsidy | 1 | |
Proceeds from the sale of businesses and other assets | 0.7 | 1.8 |
Cash used in investing activities | (46.9) | (56.7) |
Cash flows from financing activities | ||
Deferred financing fees | (0.6) | |
Short term borrowings, net | (2.3) | (0.1) |
Purchase of treasury shares | (59.1) | (60.5) |
Dividends paid | (33.8) | (31.8) |
Proceeds from exercise of option awards | 0.8 | 2.3 |
Withholding taxes paid on restricted share units | (4) | (8.3) |
Net proceeds from issuance of Term Loan B | 696.5 | |
Cash used in financing activities | (101.9) | (102.5) |
Effect of exchange rates on cash | (1.6) | (4.6) |
Net change in cash, cash equivalents and restricted cash | 83.6 | 18.6 |
Cash, cash equivalents and restricted cash, beginning of period | 452.3 | 432.8 |
Cash, cash equivalents and restricted cash, end of period | 535.9 | $ 451.4 |
Restricted cash | $ (1) | |
Restricted Cash and Cash Equivalents, Current, Asset, Statement of Financial Position [Extensible List] | Other Assets, Current | Other Assets, Current |
Cash and cash equivalents, end of period | $ 534.9 | $ 451.4 |
2024 Term Loan B | ||
Cash flows from financing activities | ||
Repayments of Term Loans | $ (3.5) | $ (700) |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2019 | |
Basis of Presentation | |
Basis of Presentation | NOTE 1—BASIS OF PRESENTATION The unaudited interim condensed consolidated financial statements of Trinseo S.A. and its subsidiaries (the “Company”) as of and for the periods ended June 30, 2019 and 2018 were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and reflect all adjustments, consisting only of normal recurring adjustments, which, in the opinion of management, are considered necessary for the fair statement of the results for the periods presented. Because they cover interim periods, the statements and related notes to the financial statements do not include all disclosures normally provided in annual financial statements, and therefore, these statements should be read in conjunction with the 2018 audited consolidated financial statements included within the Company’s Annual Report The December 31, 2018 condensed consolidated balance sheet data presented herein was derived from the Company’s December 31, 2018 audited consolidated financial statements, but does not include all disclosures required by GAAP for annual periods. The presentation of prior year amounts in the condensed consolidated statements of shareholders’ equity have been updated to conform to the current year presentation. |
Recent Accounting Guidance
Recent Accounting Guidance | 6 Months Ended |
Jun. 30, 2019 | |
Recent Accounting Guidance | |
Recent Accounting Guidance | NOTE 2—RECENT ACCOUNTING GUIDANCE In February 2016, the FASB issued guidance related to leases that outlines a comprehensive lease accounting model and supersedes prior lease guidance. The new guidance requires lessees to recognize on the consolidated balance sheets lease liabilities and corresponding right-of-use (“ROU”) assets for all leases with terms of greater than 12 months. It also changes the definition of a lease and expands the disclosure requirements of lease arrangements. The new guidance must be adopted using a modified retrospective transition, applying the new standard to all leases existing at the date of initial application. The Company adopted the standard effective January 1, 2019, and as a result, the Company recorded ROU assets and lease liabilities of $73.0 million and $72.4 million, respectively, on the condensed consolidated balance sheet as of January 1, 2019. The Company’s adoption of this standard did not result in a cumulative effect adjustment being recorded to opening retained earnings as of January 1, 2019 and did not have a material impact on the Company’s condensed consolidated statements of operations or cash flows. Refer to Note 18 for new disclosure requirements in effect as a result of this adoption. In August 2018, the FASB issued guidance which modifies the disclosure requirements for employers that sponsor defined benefit pension plans or other postretirement plans. This amendment is effective for public companies for fiscal years ending after December 15, 2020. Early adoption is permitted, and the provisions of the amendment should be applied on a retrospective basis to all periods presented. The Company does not anticipate that adoption of the new guidance will have a material impact on its consolidated financial statements. In August 2018, the FASB issued guidance which aligns the requirements for capitalizing implementation costs incurred in a cloud computing hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This standard update is effective for public companies for interim and annual periods beginning after December 15, 2019, with early adoption permitted. The Company will adopt the new guidance prospectively to eligible costs incurred on or after the date first applied. The Company does not anticipate that adoption of this guidance will have a material impact on its consolidated financial statements, barring significant future cloud computing transactions. |
Net Sales
Net Sales | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Net Sales | NOTE 3—NET SALES Sales are recognized at a point when control of the promised goods or services is transferred to the customer in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services, and when the Company’s related performance obligation is satisfied under the terms of the contract. Standard terms of delivery are included in contracts of sale, order confirmation documents, and invoices. Sales and other taxes that the Company collects concurrent with sales-producing activities are excluded from “Net sales” and included as a component of “Cost of sales” in the condensed consolidated statements of operations. Additionally, freight and any directly related costs of transporting finished products to customers are accounted for as fulfilment costs and are also included within “Cost of sales.” The amount of net sales recognized varies with changes in returns, rebates, cash sales incentives, and other allowances offered to customers based on the Company's experience. The following table provides disclosure of net sales to external customers by primary geographical market (based on the location where sales originated), by segment for the three and six months ended June 30, 2019 and 2018: Latex Synthetic Performance Three Months Ended Binders Rubber Plastics Polystyrene Feedstocks Total June 30, 2019 United States $ 67.2 $ — $ 78.4 $ — $ 2.4 $ 148.0 Europe 99.2 112.1 187.3 115.9 33.2 547.7 Asia-Pacific 60.8 — 59.7 91.2 19.3 231.0 Rest of World 3.0 — 22.1 — — 25.1 Total $ 230.2 $ 112.1 $ 347.5 $ 207.1 $ 54.9 $ 951.8 June 30, 2018 United States $ 74.8 $ — $ 82.7 $ — $ 2.9 $ 160.4 Europe 119.1 155.3 245.2 164.6 55.3 739.5 Asia-Pacific 82.6 — 60.9 121.0 43.9 308.4 Rest of World 4.3 — 24.0 — — 28.3 Total $ 280.8 $ 155.3 $ 412.8 $ 285.6 $ 102.1 $ 1,236.6 Latex Synthetic Performance Six Months Ended Binders Rubber Plastics Polystyrene Feedstocks Total June 30, 2019 United States $ 130.5 $ — $ 160.2 $ — $ 5.1 $ 295.8 Europe 200.6 236.7 400.7 254.1 73.6 1,165.7 Asia-Pacific 117.3 — 111.2 181.5 43.0 453.0 Rest of World 5.7 — 44.7 — — 50.4 Total $ 454.1 $ 236.7 $ 716.8 $ 435.6 $ 121.7 $ 1,964.9 June 30, 2018 United States $ 139.1 $ — $ 166.8 $ 0.2 $ 6.6 $ 312.7 Europe 232.6 304.5 494.3 312.6 113.3 1,457.3 Asia-Pacific 156.8 — 108.2 212.4 56.8 534.2 Rest of World 7.6 — 46.3 — — 53.9 Total $ 536.1 $ 304.5 $ 815.6 $ 525.2 $ 176.7 $ 2,358.1 |
Investments in Unconsolidated A
Investments in Unconsolidated Affiliates | 6 Months Ended |
Jun. 30, 2019 | |
Investments in Unconsolidated Affiliates | |
Investments in Unconsolidated Affiliates | NOTE 4—INVESTMENTS IN UNCONSOLIDATED AFFILIATES The Company’s investments held in unconsolidated affiliates are accounted for by the equity method. The Company is currently supplemented by one joint venture, Americas Styrenics LLC (“Americas Styrenics,” a styrene and polystyrene joint venture with Chevron Phillips Chemical Company LP). The results of Americas Styrenics are included within its own reporting segment. Americas Styrenics is a privately held company; therefore, a quoted market price for its equity interests are not available. The summarized financial information of the Company’s unconsolidated affiliate is shown below. Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Sales $ 418.4 $ 481.5 $ 787.6 $ 968.1 Gross profit $ 85.9 $ 73.0 $ 140.1 $ 168.2 Net income $ 72.8 $ 58.7 $ 115.7 $ 144.4 Americas Styrenics As of June 30, 2019 and December 31, 2018, the Company’s investment in Americas Styrenics was $199.1 million and $179.1 million, respectively, which was $18.9 million and $46.4 million less than the Company’s 50% share of the underlying net assets of Americas Styrenics, respectively. This amount represents the difference between the book value of assets contributed to the joint venture at the time of formation (May 1, 2008) and the Company’s 50% share of the total recorded value of the joint venture’s assets and certain adjustments to conform with the Company’s accounting policies. This difference is being amortized over the weighted average remaining useful life of the contributed assets of approximately 1.7 years as of June 30, 2019. The Company received dividends from Americas Styrenics of $40.0 million and $52.5 million during the three and six months ended June 30, 2019, respectively, compared to $37.5 million and $67.5 million during the three and six months ended June 30, 2018, respectively. |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2019 | |
Inventories | |
Inventories | NOTE 5—INVENTORIES Inventories consisted of the following: June 30, December 31, 2019 2018 Finished goods $ 223.7 $ 269.8 Raw materials and semi-finished goods 199.7 205.8 Supplies 35.1 34.8 Total $ 458.5 $ 510.4 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2019 | |
Debt | |
Debt | NOTE 6—DEBT Refer to the Annual Report As of June 30, 2019 and December 31, 2018, debt consisted of the following: June 30, 2019 December 31, 2018 Interest Rate as of Maturity Date Carrying Amount Unamortized Deferred Financing Fees (1) Total Debt, Less Unamortized Deferred Financing Fees Carrying Amount Unamortized Deferred Financing Fees (1) Total Debt, Less Senior Credit Facility 2024 Term Loan B 4.402% September 2024 $ 687.8 $ (14.9) $ 672.9 $ 691.3 $ (16.2) $ 675.1 2022 Revolving Facility (2) Various September 2022 — — — — — — 2025 Senior Notes 5.375% September 2025 500.0 (7.8) 492.2 500.0 (8.4) 491.6 Accounts Receivable Securitization Facility (3) Various September 2021 — — — — — — Other indebtedness Various Various 4.1 — 4.1 1.1 — 1.1 Total debt $ 1,191.9 $ (22.7) $ 1,169.2 $ 1,192.4 $ (24.6) $ 1,167.8 Less: current portion (4) (8.7) (7.0) Total long-term debt, net of unamortized deferred financing fees $ 1,160.5 $ 1,160.8 (1) This caption does not include deferred financing fees related to the Company’s revolving facilities, which are included within “Deferred charges and other assets” on the condensed consolidated balance sheets. (2) Under the 2022 Revolving Facility, the Company had a capacity of $375.0 million and funds available for borrowing of $360.9 million (net of $14.1 million outstanding letters of credit) as of June 30, 2019. Additionally, the Company is required to pay a quarterly commitment fee in respect of any unused commitments under this facility equal to 0.375% per annum. (3) This facility had a borrowing capacity of $150.0 million as of June 30, 2019. Additionally, as of June 30, 2019, the Company had approximately $134.2 million of accounts receivable available to support this facility, based on the pool of eligible accounts receivable. In regard to outstanding borrowings, fixed interest charges are 1.95% plus variable commercial paper rates, while for available, but undrawn commitments, fixed interest charges are 1.00% (4) As of June 30, 2019 and December 31, 2018, the current portion of long-term debt primarily related to $7.0 million of the scheduled future principal payments on the 2024 Term Loan B. . |
Goodwill
Goodwill | 6 Months Ended |
Jun. 30, 2019 | |
Goodwill. | |
Goodwill | NOTE 7—GOODWILL The following table shows changes in the carrying amount of goodwill, by segment, from December 31, 2018 to June 30, 2019: Latex Synthetic Performance Americas Binders Rubber Plastics Polystyrene Feedstocks Styrenics Total Balance at December 31, 2018 $ 15.9 $ 11.3 $ 37.3 $ 4.5 $ — $ — $ 69.0 Foreign currency impact (0.1) (0.1) (0.1) — — — (0.3) Balance at June 30, 2019 $ 15.8 $ 11.2 $ 37.2 $ 4.5 $ — $ — $ 68.7 |
Derivative Instruments
Derivative Instruments | 6 Months Ended |
Jun. 30, 2019 | |
Derivative Instruments [Abstract] | |
Derivative Instruments | NOTE 8—DERIVATIVE INSTRUMENTS The Company’s ongoing business operations expose it to various risks, including fluctuating foreign exchange rates and interest rate risk. To manage these risks, the Company periodically enters into derivative financial instruments, such as foreign exchange forward contracts and interest rate swap agreements. The Company does not hold or enter into financial instruments for trading or speculative purposes. All derivatives are recorded on the condensed consolidated balance sheets at fair value. Foreign Exchange Forward Contracts Certain subsidiaries have assets and liabilities denominated in currencies other than their respective functional currencies, which creates foreign exchange risk. The Company’s principal strategy in managing its exposure to changes in foreign currency exchange rates is to naturally hedge the foreign currency-denominated liabilities on its balance sheet against corresponding assets of the same currency, such that any changes in liabilities due to fluctuations in exchange rates are offset by changes in their corresponding foreign currency assets. In order to further reduce this exposure, the Company also uses foreign exchange forward contracts to economically hedge the impact of the variability in exchange rates on assets and liabilities denominated in certain foreign currencies. These derivative contracts are not designated for hedge accounting treatment. As of June 30, 2019, the Company had open foreign exchange forward contracts with a notional U.S. dollar equivalent absolute value of $403.8 million. The following table displays the notional amounts of the most significant net foreign exchange hedge positions outstanding as of June 30, 2019: June 30, Buy / (Sell) 2019 Euro $ (262.4) Chinese Yuan $ (42.4) Swiss Franc $ 33.4 Mexican Peso $ (15.2) Indonesian Rupiah $ (13.8) Open foreign exchange forward contracts as of June 30, 2019 had maturities occurring over a period of two months. Foreign Exchange Cash Flow Hedges The Company also enters into forward contracts with the objective of managing the currency risk associated with forecasted U.S. dollar-denominated raw materials purchases by one of its subsidiaries whose functional currency is the euro. By entering into these forward contracts, which are designated as cash flow hedges, the Company buys a designated amount of U.S. dollars and sells euros at the prevailing market rate to mitigate the risk associated with the fluctuations in the euro-to-U.S. dollar foreign currency exchange rates. The qualifying hedge contracts are marked-to-market at each reporting date and any unrealized gains or losses are included in Accumulated Other Comprehensive Income (“AOCI”) to the extent effective, and reclassified to cost of sales in the period during which the transaction affects earnings or it becomes probable that the forecasted transaction will not occur. Open foreign exchange cash flow hedges as of June 30, 2019 had maturities occurring over a period of six months, and had a net notional U.S. dollar equivalent of $71.4 million. Interest Rate Swaps On September 6, 2017, the Company issued the 2024 Term Loan B, which currently bears an interest rate of the London Interbank Offered Rate (“LIBOR”) plus 2.00%, subject to a 0.00% LIBOR floor. In order to reduce the variability in interest payments associated with the Company’s variable rate debt, during 2017 the Company entered into certain interest rate swap agreements to convert a portion of these variable rate borrowings into a fixed rate obligation. These interest rate swap agreements are designated as cash flow hedges, and as such, the contracts are marked-to-market at each reporting date and any unrealized gains or losses are included in AOCI to the extent effective, and reclassified to interest expense in the period during which the transaction affects earnings or it becomes probable that the forecasted transaction will not occur. As of June 30, 2019, the Company had open interest rate swap agreements with a net notional U.S. dollar equivalent of $200.0 million which had an effective date of September 29, 2017 and mature in September 2022. Under the terms of the swap agreements, the Company is required to pay the counterparties a stream of fixed interest payments at a rate of 1.81%, and in turn, receives variable interest payments based on 1-month LIBOR (2.40% as of June 30, 2019) from the counterparties. Net Investment Hedge On September 1, 2017, the Company entered into certain fixed-for-fixed cross currency swaps (“CCS”), swapping USD principal and interest payments on its 2025 Senior Notes for euro-denominated payments the CCS were deemed to be highly effective hedges. A cumulative foreign currency translation loss of $38.0 million was recorded within AOCI related to the CCS through March 31, 2018. Effective April 1, 2018, the Company elected as an accounting policy to re-designate the CCS as a net investment hedge (and any future similar hedges) under the spot method. As such, changes in the fair value of the CCS that are included in the assessment of effectiveness (changes due to spot foreign exchange rates) are recorded as cumulative foreign currency translation within OCI, and will remain in AOCI until either the sale or substantially complete liquidation of the subsidiary. As of June 30, 2019, no gains or losses have been reclassified from AOCI into income related to the sale or substantially complete liquidation of the relevant subsidiaries. As an additional accounting policy election applied to similar hedges under this new standard, the initial value of any component excluded from the assessment of effectiveness is recognized in income using a systematic and rational method over the life of the hedging instrument. Any difference between the change in the fair value of the excluded component and amounts recognized in income under that systematic and rational method is recognized in AOCI. Prior to April 1, 2018, no components were excluded from the assessment of effectiveness for any of the Company’s existing net investment hedges. As of April 1, 2018, the initial excluded component value related to the CCS was $23.6 million, which the Company elected to amortize as a reduction of “Interest expense, net” in the condensed consolidated statements of operations using the straight-line method over the remaining term of the CCS. Additionally, the accrual of periodic USD and euro-denominated interest receipts and payments under the terms of the CCS are being recognized within “Interest expense, net” in the condensed consolidated statements of operations. Summary of Derivative Instruments The following tables present the effect of the Company’s derivative instruments, including those not designated for hedge accounting treatment, on the condensed consolidated statements of operations for the three and six months ended June 30, 2019 and 2018: Location and Amount of Gain (Loss) Recognized in Three Months Ended Three Months Ended June 30, 2019 June 30, 2018 Cost of Interest expense, net Other expense, net Cost of Interest expense, net Other expense, net Total amount of income and expense line items presented in the statements of operations in which the effects of derivative instruments are recorded $ 865.6 $ 9.9 $ 1.5 $ 1,073.9 $ 10.8 $ 4.5 The effects of cash flow hedge instruments: Foreign exchange cash flow hedges Amount of gain (loss) reclassified from AOCI into income $ 1.6 $ — $ — $ (2.6) $ — $ — Interest rate swaps Amount of gain reclassified from AOCI into income $ — $ 0.3 $ — $ — $ 0.1 $ — The effects of net investment hedge instruments: Cross currency swaps (CCS) Amount of gain excluded from effectiveness testing $ — $ 3.9 $ — $ — $ 3.9 $ — The effects of derivatives not designated as hedge instruments: Foreign exchange forward contracts Amount of gain (loss) recognized in income $ — $ — $ (2.4) $ — $ — $ 14.1 Location and Amount of Gain (Loss) Recognized in Statements of Operations Six Months Ended Six Months Ended June 30, 2019 June 30, 2018 Cost of Interest expense, net Other expense, net Cost of Interest expense, net Other expense, net Total amount of (income) expense line items presented in the statements of operations in which the effects of derivative instruments are recorded $ 1,781.2 $ 20.1 $ 5.5 $ 2,020.2 $ 25.7 $ 0.8 Effects of cash flow hedge instruments: Foreign exchange cash flow hedges Amount of gain (loss) reclassified from AOCI into income $ 2.2 $ — $ — $ (6.3) $ — $ — Interest rate swaps Amount of gain reclassified from AOCI into income $ — $ 0.7 $ — $ — $ — $ — Effects of net investment hedge instruments: Cross currency swaps (CCS) Amount of gain excluded from effectiveness testing $ — $ 7.9 $ — $ — $ 3.9 $ — Effects of derivatives not designated as hedge instruments: Foreign exchange forward contracts Amount of gain recognized in income $ — $ — $ 0.3 $ — $ — $ 8.8 The following table presents the effect of cash flow and net investment hedge accounting on AOCI for the three and six months ended June 30, 2019 and 2018: ` Gain (Loss) Recognized in AOCI on Balance Sheet Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Designated as Cash Flow Hedges Foreign exchange cash flow hedges $ (1.8) $ 10.7 $ 0.5 $ 10.2 Interest rate swaps (3.6) 1.2 (5.8) 4.5 Total $ (5.4) $ 11.9 $ (5.3) $ 14.7 Designated as Net Investment Hedges Cross currency swaps (CCS) $ (3.6) $ 30.8 $ 7.9 $ 10.3 Total $ (3.6) $ 30.8 $ 7.9 $ 10.3 The Company recorded a loss of $2.4 million and a gain of $0.3 million during the three and six months ended June 30, 2019, respectively, and gains of $14.1 million and $8.8 million during the three and six months ended June 30, 2018, respectively, from settlements and changes in the fair value of outstanding forward contracts (not designated as hedges). The gains and losses from these forward contracts offset net foreign exchange transaction gains of $2.6 million and losses of $0.5 million during the three and six months ended June 30, 2019, respectively, and losses of $16.1 million and $5.7 million during the three and six months ended June 30, 2018, respectively, which resulted from the re-measurement of the Company’s foreign currency denominated assets and liabilities. The cash settlements of these foreign exchange forward contracts are included within operating activities in the condensed consolidated statements of cash flows. The Company expects to reclassify in the next twelve months an approximate $2.5 million net gain from AOCI into earnings related to the Company’s outstanding foreign exchange cash flow hedges and interest rate swaps as of June 30, 2019 based on current foreign exchange rates. The following tables summarize the gross and net unrealized gains and losses, as well as the balance sheet classification, of outstanding derivatives recorded in the condensed consolidated balance sheets: June 30, 2019 Foreign Foreign Exchange Exchange Interest Cross Balance Sheet Forward Cash Flow Rate Currency Classification Contracts Hedges Swaps Swaps Total Asset Derivatives: Accounts receivable, net of allowance $ 0.9 $ 2.4 $ 0.1 $ 8.3 $ 11.7 Deferred charges and other assets — — 6.8 6.8 Gross derivative asset position 0.9 2.4 0.1 15.1 18.5 Less: Counterparty netting (0.9) — — — (0.9) Net derivative asset position $ — $ 2.4 $ 0.1 $ 15.1 $ 17.6 Liability Derivatives: Accounts payable $ (7.9) $ — $ — $ — $ (7.9) Other noncurrent obligations — — (1.2) — (1.2) Gross derivative liability position (7.9) — (1.2) — (9.1) Less: Counterparty netting 0.8 — — — 0.8 Net derivative liability position $ (7.1) $ — $ (1.2) $ — $ (8.3) Total net derivative position $ (7.1) $ 2.4 $ (1.1) $ 15.1 $ 9.3 December 31, 2018 Foreign Foreign Exchange Exchange Interest Cross Balance Sheet Forward Cash Flow Rate Currency Classification Contracts Hedges Swaps Swaps Total Asset Derivatives: Accounts receivable, net of allowance $ 0.6 $ 1.9 $ 1.5 $ 8.1 $ 12.1 Deferred charges and other assets — — 3.2 — 3.2 Gross derivative asset position 0.6 1.9 4.7 8.1 15.3 Less: Counterparty netting (0.5) — — — (0.5) Net derivative asset position $ 0.1 $ 1.9 $ 4.7 $ 8.1 $ 14.8 Liability Derivatives: Accounts payable $ (2.1) $ — $ — $ — $ (2.1) Other noncurrent obligations — — — (3.4) (3.4) Gross derivative liability position (2.1) — — (3.4) (5.5) Less: Counterparty netting 0.5 — — — 0.5 Net derivative liability position $ (1.6) $ — $ — $ (3.4) $ (5.0) Total net derivative position $ (1.5) $ 1.9 $ 4.7 $ 4.7 $ 9.8 Forward contracts, interest rate swaps, and cross currency swaps are entered into with a limited number of counterparties, each of which allows for net settlement of all contracts through a single payment in a single currency in the event of a default on or termination of any one contract. As such, in accordance with the Company’s accounting policy, these derivative instruments are recorded on a net basis by counterparty within the condensed consolidated balance sheets. Refer to Notes 9 and 16 of the condensed consolidated financial statements for further information regarding the fair value of the Company’s derivative instruments and the related changes in AOCI. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value Measurements | |
Fair Value Measurements | NOTE 9—FAIR VALUE MEASUREMENTS Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date. Level 1—Valuation is based upon quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2—Valuation is based upon quoted prices for similar assets and liabilities in active markets, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3—Valuation is based upon other unobservable inputs that are significant to the fair value measurement. The following table summarizes the basis used to measure certain assets and liabilities at fair value on a recurring basis in the condensed consolidated balance sheets as of June 30, 2019 and December 31, 2018: June 30, 2019 Quoted Prices in Active Markets for Identical Items Significant Other Observable Inputs Significant Unobservable Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—(Liabilities) — (7.1) — (7.1) Foreign exchange cash flow hedges—Assets — 2.4 — 2.4 Interest rate swaps—Assets — 0.1 — 0.1 Interest rate swaps—(Liabilities) — (1.2) — (1.2) Cross currency swaps—Assets — 15.1 — 15.1 Total fair value $ — $ 9.3 $ — $ 9.3 December 31, 2018 Quoted Prices in Active Markets for Identical Items Significant Other Observable Inputs Significant Unobservable Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—Assets $ — $ 0.1 $ — $ 0.1 Foreign exchange forward contracts—(Liabilities) — (1.6) — (1.6) Foreign exchange cash flow hedges—Assets — 1.9 — 1.9 Interest rate swaps—Assets — 4.7 — 4.7 Cross currency swaps—Assets — 8.1 — 8.1 Cross currency swaps—(Liabilities) — (3.4) — (3.4) Total fair value $ — $ 9.8 $ — $ 9.8 The Company uses an income approach to value its derivative instruments, utilizing discounted cash flow techniques, considering the terms of the contract and observable market information available as of the reporting date, such as interest rate yield curves and currency spot and forward rates. Significant inputs to the valuation for these derivative instruments are obtained from broker quotations or from listed or over-the-counter market data, and are classified as Level 2 in the fair value hierarchy. Fair Value of Debt Instruments The following table presents the estimated fair value of the Company’s outstanding debt not carried at fair value as of June 30, 2019 and December 31, 2018: As of As of June 30, 2019 December 31, 2018 2025 Senior Notes $ 482.3 $ 438.3 2024 Term Loan B 681.3 658.9 Total fair value $ 1,163.6 $ 1,097.2 The fair value of the Company’s debt facilities above (each Level 2 securities) is determined using over-the-counter market quotes and benchmark yields received from independent vendors. There were no other significant financial instruments outstanding as of June 30, 2019 and December 31, 2018. |
Provision for Income Taxes
Provision for Income Taxes | 6 Months Ended |
Jun. 30, 2019 | |
Provision for Income Taxes | |
Provision for Income Taxes | NOTE 10—PROVISION FOR INCOME TAXES Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Effective income tax rate 36.0 % 17.2 % 29.3 % 17.2 % Provision for income taxes for the three and six months ended June 30, 2019 totaled $15.7 million and $26.5 million, respectively, resulting in an effective tax rate of 36.0% and 29.3%, respectively. Provision for income taxes for the three and six months ended June 30, 2018 totaled $20.4 million and $45.3 million, respectively, resulting in an effective tax rate of 17.2%. The increase in the effective tax rate for the three and six months ended June 30, 2019 as compared to the same period in 2018 was primarily driven by a lower proportion of income before taxes attributable to non-U.S. jurisdictions, which includes losses not anticipated to provide a tax benefit to the Company in the future. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure | |
Commitments and Contingencies | NOTE 11—COMMITMENTS AND CONTINGENCIES Environmental Matters Accruals for environmental matters are recorded when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated based on current law, existing technologies and other information. Pursuant to the terms of the agreement associated with the Company’s formation, the pre-closing environmental liabilities were retained by Dow, and Dow agreed, subject to temporal, monetary, and other limitations to indemnify the Company from and against environmental liabilities incurred or relating to the predecessor periods. No environmental claims have been asserted or threatened against the Company, and the Company is not a potentially responsible party at any Superfund Sites. As of June 30, 2019 and December 31, 2018, the Company had no accrued obligations for environmental remediation or restoration costs. Inherent uncertainties exist in the Company’s potential environmental liabilities primarily due to unknown conditions, whether future claims may fall outside the scope of the indemnity, changing governmental regulations and legal standards regarding liability, and evolving technologies for handling site remediation and restoration. In connection with the Company’s existing indemnification, the possibility is considered remote that environmental remediation costs will have a material adverse impact on the condensed consolidated financial statements over the next 12 months. Purchase Commitments In the normal course of business, the Company has certain raw material purchase contracts where it is required to purchase certain minimum volumes at current market prices. These commitments range from one to three years. In certain raw material purchase contracts, the Company has the right to purchase less than the required minimums and pay a liquidated damages fee, or, in case of a permanent plant shutdown, to terminate the contracts. In such cases, these obligations would be less than the annual commitment as disclosed in the Notes to Consolidated Financial Statements included in the Annual Report Litigation Matters From time to time, the Company may be subject to various legal claims and proceedings incidental to the normal conduct of business, relating to such matters as employees, product liability, antitrust/competition, past waste disposal practices and release of chemicals into the environment. While it is impossible at this time to determine with certainty the ultimate outcome of these routine claims, the Company does not believe that the ultimate resolution of these claims will have a material adverse effect on the Company’s results of operations, financial condition or cash flow. Legal costs, including those legal costs expected to be incurred in connection with a loss contingency, are expensed as incurred. European Commission Request for Information On June 6, 2018, Trinseo Europe GmbH, a subsidiary of the Company, received a Request for Information in the form of a letter from the European Commission Directorate General for Competition (the “European Commission”) related to styrene monomer commercial activity in the European Economic Area. In addition, the Company commenced an internal investigation into these commercial activities and discovered instances of inappropriate activity. The Company is fully cooperating with the European Commission and delivered all requested documents responsive to its information request. Notwithstanding the delivery of the Company’s response to the European Commission, this matter remains open with the European Commission. Based on its findings, the European Commission may decide to: (i) require further information; (ii) conduct unannounced raids of the Company’s premises; (iii) adopt decisions imposing fines, interim measures to halt immediately any anti-competitive behavior, orders for the Company to cease anti-competitive activities, and/or certain behavioral or structural commitments from the Company; or (iv) take no further action. As a result of the above factors, the Company is unable to predict the ultimate outcome of this matter or estimate the range of reasonably possible losses that could be incurred. However, any potential losses incurred could be material to the Company’s results of operations, balance sheet, and cash flows for the period in which they are resolved or become probable and reasonably estimable. |
Pension Plans and Other Postret
Pension Plans and Other Postretirement Benefits | 6 Months Ended |
Jun. 30, 2019 | |
Pension Plans and Other Postretirement Benefits | |
Pension Plans and Other Postretirement Benefits | NOTE 12—PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS The components of net periodic benefit costs for all significant plans were as follows: Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Defined Benefit Pension Plans Service cost $ 3.1 $ 3.1 $ 6.3 $ 6.2 Interest cost 1.2 1.2 2.5 2.5 Expected return on plan assets (0.5) (0.5) (1.0) (1.1) Amortization of prior service credit (0.3) (0.3) (0.5) (0.6) Amortization of net loss 0.8 0.9 1.5 1.9 Net settlement and curtailment loss — — 0.7 — Net periodic benefit cost $ 4.3 $ 4.4 $ 9.5 $ 8.9 Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Other Postretirement Plans Service cost $ — $ — $ 0.1 $ 0.1 Interest cost 0.1 0.1 0.1 0.1 Amortization of prior service cost — — — 0.1 Amortization of net gain (0.1) — (0.2) — Net periodic benefit cost $ — $ 0.1 $ — $ 0.3 Service cost related to the Company’s defined benefit pension plans and other postretirement plans is included within “Cost of sales” and “Selling, general and administrative expenses” whereas all other components of net periodic benefit cost are included within “Other expense, net” in the condensed consolidated statements of operations. As of June 30, 2019 and December 31, 2018, the Company’s benefit obligations included primarily in “Other noncurrent obligations” in the condensed consolidated balance sheets were $196.4 million and $189.2 million, respectively. The Company made cash contributions and benefit payments to unfunded plans of approximately $2.0 million and $2.9 million during the three and six months ended June 30, 2019, respectively. The Company expects to make additional cash contributions, including benefit payments to unfunded plans, of approximately $3.3 million to its defined benefit plans for the remainder of 2019. |
Share-Based Compensation
Share-Based Compensation | 6 Months Ended |
Jun. 30, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | NOTE 13—SHARE-BASED COMPENSATION Refer to the Annual Report The following table summarizes the Company’s share-based compensation expense for the three and six months ended June 30, 2019 and 2018, as well as unrecognized compensation cost as of June 30, 2019: As of Three Months Ended Six Months Ended June 30, 2019 June 30, June 30, Unrecognized Weighted 2019 2018 2019 2018 Compensation Cost Average Years RSUs $ 1.9 $ 2.1 $ 4.0 $ 4.3 $ 13.9 2.2 Options 0.8 0.6 2.0 3.4 2.8 1.6 PSUs 0.8 0.7 1.7 1.2 5.9 2.3 Total share-based compensation expense $ 3.5 $ 3.4 $ 7.7 $ 8.9 The following table summarizes awards granted and the respective weighted average grant date fair value for the six months ended June 30, 2019: Six Months Ended June 30, 2019 Awards Granted Weighted Average Grant Date Fair Value per Award RSUs 236,156 $ 48.63 Options 237,071 15.40 PSUs 117,053 54.01 Option Awards The following are the weighted average assumptions used within the Black-Scholes pricing model for the Company’s option awards granted during the six months ended June 30, 2019: Six Months Ended June 30, 2019 Expected term (in years) 5.50 Expected volatility 36.00 % Risk-free interest rate 2.53 % Dividend yield 2.00 % Since the Company’s equity interests were privately held prior to its initial public offering in June 2014, there is limited publicly traded history of the Company’s ordinary shares. Until such time that the Company can determine expected volatility based solely on the publicly traded history of its ordinary shares, expected volatility used in the Black-Scholes model for option awards granted is based on a combination of the Company’s historical volatility and similar companies’ shares that are publicly traded. The expected term of option awards represents the period of time that option awards granted are expected to be outstanding. For the option awards granted during the six months ended June 30, 2019, the simplified method was used to calculate the expected term, given the Company’s limited historical exercise data. The risk-free interest rate for the periods within the expected term of option awards is based on the U.S. Treasury yield curve in effect at the time of grant. The dividend yield is estimated based on historical and expected dividend activity. Performance Share Units (PSUs) The following are the weighted average assumptions used within the Monte Carlo valuation model for PSUs granted during the six months ended June 30, 2019: Six Months Ended June 30, 2019 Expected term (in years) 3.00 Expected volatility 36.40 % Risk-free interest rate 2.58 % Share Price $ 50.95 Determining the fair value of PSUs requires considerable judgment, including estimating the expected volatility of the price of the Company’s ordinary shares, the correlation between the Company’s share price and that of its peer companies, and the expected rate of interest. The expected volatility for each grant is determined based on the historical volatility of the Company’s ordinary shares. The expected term of PSUs represents the length of the performance period. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for a duration equivalent to the performance period. The share price is the closing price of the Company’s ordinary shares on the grant date. |
Segments
Segments | 6 Months Ended |
Jun. 30, 2019 | |
Segments | |
Segments | NOTE 14—SEGMENTS The Company operates under six segments: Latex Binders, Synthetic Rubber, Performance Plastics, Polystyrene, Feedstocks, and Americas Styrenics. The Latex Binders segment produces styrene-butadiene latex (“SB latex”) and other latex polymers and binders, primarily for coated paper and packaging board, carpet and artificial turf backings, as well as a number of performance latex binders applications, such as adhesive, building and construction and the technical textile paper market. The Synthetic Rubber segment produces synthetic rubber products used predominantly in high-performance tires, impact modifiers and technical rubber products, such as conveyer belts, hoses, seals and gaskets. The Performance Plastics segment includes a variety of highly engineered compounds and blends, the Company’s acrylonitrile-butadiene-styrene (“ABS”), styrene-acrylonitrile (“SAN”), and polycarbonate (“PC”) businesses, and the Company’s soft-touch polymers and bioplastics business, which includes thermoplastic elastomers (“TPEs”). The Polystyrene segment includes a variety of general purpose polystyrenes (“GPPS”) and polystyrene that has been modified with polybutadiene rubber to increase its impact resistant properties (“HIPS”). The Feedstocks segment includes the Company’s production and procurement of styrene monomer outside of North America, which is used as a key raw material in many of the Company’s products, including polystyrene, SB latex, ABS resins, and solution styrene- butadiene rubber (“SSBR”). Lastly, the Americas Styrenics segment consists solely of the operations of the Company’s 50%-owned joint venture, Americas Styrenics, a producer of both styrene monomer and polystyrene in North America. The following table provides disclosure of the Company’s segment Adjusted EBITDA, which is used to measure segment operating performance and is defined below, for the three and six months ended June 30, 2019 and 2018. Asset and intersegment sales information by reporting segment is not regularly reviewed or included with the Company’s reporting to the chief operating decision maker. Therefore, this information has not been disclosed below. Refer to Note 3 for the Company’s net sales to external customers by segment for the three and six months ended June 30, 2019 and 2018. Latex Synthetic Performance Americas Three Months Ended (1) Binders Rubber Plastics Polystyrene Feedstocks Styrenics June 30, 2019 $ 20.6 $ 12.9 $ 34.2 $ 16.2 $ (0.6) $ 40.3 June 30, 2018 $ 36.0 $ 30.6 $ 48.9 $ 13.7 $ 32.4 $ 33.2 Latex Synthetic Performance Americas Six Months Ended Binders Rubber Plastics Polystyrene Feedstocks Styrenics June 30, 2019 $ 38.1 $ 21.7 $ 69.9 $ 32.9 $ 16.6 $ 72.5 June 30, 2018 $ 63.5 $ 56.2 $ 114.3 $ 23.3 $ 73.9 $ 78.8 (1) The Company’s primary measure of segment operating performance is Adjusted EBITDA, which is defined as income from continuing operations before interest expense, net; provision for income taxes; depreciation and amortization expense; loss on extinguishment of long-term debt; asset impairment charges; gains or losses on the dispositions of businesses and assets; restructuring charges; acquisition related costs and other items. Segment Adjusted EBITDA is a key metric that is used by management to evaluate business performance in comparison to budgets, forecasts, and prior year financial results, providing a measure that management believes reflects core operating performance by removing the impact of transactions and events that would not be considered a part of core operations. Other companies in the industry may define segment Adjusted EBITDA differently than the Company, and as a result, it may be difficult to use segment Adjusted EBITDA, or similarly named financial measures, that other companies may use to compare the performance of those companies to the Company’s segment performance. The reconciliation of income before income taxes to segment Adjusted EBITDA is as follows: Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Income before income taxes $ 43.7 $ 118.7 $ 90.3 $ 263.9 Interest expense, net 9.9 10.8 20.1 25.7 Depreciation and amortization 34.7 32.3 68.7 64.3 Corporate Unallocated (2) 20.8 24.6 46.9 44.9 Adjusted EBITDA Addbacks (3) 14.5 8.4 25.7 11.2 Segment Adjusted EBITDA $ 123.6 $ 194.8 $ 251.7 $ 410.0 (2) Corporate unallocated includes corporate overhead costs and certain other income and expenses. (3) Adjusted EBITDA addbacks for the three and six months ended June 30, 2019 and 2018 are as follows: Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Loss on extinguishment of long-term debt $ — $ 0.2 $ — $ 0.2 Net gain on disposition of businesses and assets — — (0.2) (0.5) Restructuring and other charges (Note 15) (0.3) 1.2 0.1 1.7 Acquisition, transaction, and integration costs (a) 0.7 0.2 0.7 0.6 Other items (b) 14.1 6.8 25.1 9.2 Total Adjusted EBITDA Addbacks $ 14.5 $ 8.4 $ 25.7 $ 11.2 (a) Acquisition, transaction, and integration costs for the three and six months ended June 30, 2019 and 2018 primarily relate to advisory and professional fees incurred in conjunction with the Company’s acquisition of production assets in Rheinmünster, Germany and its acquisition of API Plastics, respectively. (b) Other items for the three and six months ended June 30, 2019 and 2018 primarily relate to advisory and professional fees incurred in conjunction with the Company’s initiative to transition business services from Dow, including certain administrative services such as accounts payable, logistics, and IT services. Also included within other items for the three and six months ended June 30, 2019 are fees incurred in conjunction with certain of the Company’s strategic initiatives. |
Restructuring
Restructuring | 6 Months Ended |
Jun. 30, 2019 | |
Restructuring | |
Restructuring | NOTE 15—RESTRUCTURING Refer to the Annual Report The following table provides detail of the Company’s restructuring charges for the three and six months ended June 30, 2019 and 2018: Three Months Ended Six Months Ended Cumulative June 30, June 30, Life-to-date 2019 2018 2019 2018 Charges Segment Terneuzen Compounding Restructuring (1) Asset impairment/accelerated depreciation $ — $ 0.3 $ — $ 0.6 $ 3.1 Employee termination benefits (0.4) 0.2 (0.4) 0.3 0.6 Contract terminations — — — — 0.3 Decommissioning and other — 0.2 0.2 0.2 1.6 Terneuzen Subtotal $ (0.4) $ 0.7 $ (0.2) $ 1.1 $ 5.6 Performance Plastics Livorno Plant Restructuring (2) Asset impairment/accelerated depreciation $ — $ 0.4 $ — $ 0.4 $ 14.7 Employee termination benefits — — — — 5.4 Contract terminations — — — — 0.3 Decommissioning and other 0.1 0.1 0.3 0.4 4.0 Livorno Subtotal $ 0.1 $ 0.5 $ 0.3 $ 0.8 $ 24.4 Latex Binders Other Restructurings — 0.3 — 0.4 Various Total Restructuring Charges $ (0.3) $ 1.5 $ 0.1 $ 2.3 (1) In March 2017, the Company announced plans to upgrade its production capability for compounded resins with the construction of a new state-of-the art compounding facility to replace its existing compounding facility in Terneuzen, The Netherlands. As of June 30, 2019, the new facility is complete, noting certain ongoing quality assurance activities. Substantive production at the prior facility ceased and decommissioning activities began during the second quarter of 2019, which are expected to continue through 2020. The Company estimates it will incur decommissioning and other charges of approximately $0.6 million throughout 2019 and 2020, the majority of which are expected to be paid during the remainder of 2019 and the first half of 2020. (2) In August 2016, the Company announced its plan to cease manufacturing activities at its latex binders manufacturing facility in Livorno, Italy. Production at the facility ceased in October 2016 and decommissioning activities began in the fourth quarter of 2016. In June 2018, the Company entered into a preliminary agreement to sell the land where the former facility is located, subject to certain activities being completed prior to closing. The sale is considered probable to close within one year following the balance sheet date; therefore, as of both June 30, 2019 and December 31, 2018, the land is recorded as held-for-sale within “Other current assets” at a value of $12.0 million and the deferred tax liability associated with that land is recorded as held-for-sale within “Accrued expenses and other current liabilities” at a value of $2.9 million on the Company’s condensed consolidated balance sheets. In conjunction with the execution of this agreement, the Company received $1.3 million of the purchase price as a prepayment, which is recorded within “Accrued expenses and other current liabilities” on the condensed consolidated balance sheets as of June 30, 2019 and December 31, 2018. The Company expects to incur a limited amount of additional decommissioning costs associated with this plant shutdown through the closing date of the sale, which will be expensed as incurred. The following table provides a roll forward of the liability balances associated with the Company’s restructuring activities as of June 30, 2019. Employee termination benefit and contract termination charges are recorded within “Accrued expenses and other current liabilities” in the condensed consolidated balance sheets. Balance at Balance at December 31, 2018 Expenses Deductions (1) June 30, 2019 Employee termination benefits $ 6.4 $ (0.3) $ (4.9) $ 1.2 Contract terminations 0.3 — — 0.3 Decommissioning and other — 0.4 (0.4) — Total $ 6.7 $ 0.1 $ (5.3) $ 1.5 (1) Primarily includes payments made against the existing accrual, as well as immaterial impacts of foreign currency remeasurement. . |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 6 Months Ended |
Jun. 30, 2019 | |
Shareholders' Equity. | |
Accumulated Other Comprehensive Income (Loss) | NOTE 16—ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The components of AOCI, net of income taxes, consisted of: Cumulative Pension & Other Translation Postretirement Benefit Cash Flow Three Months Ended June 30, 2019 and 2018 Adjustments Plans, Net Hedges, Net Total Balance as of March 31, 2019 $ (112.1) $ (40.4) $ 9.0 $ (143.5) Other comprehensive income (loss) 3.0 — (3.5) (0.5) Amounts reclassified from AOCI to net income (loss) (1) — 0.3 (1.9) (1.6) Balance as of June 30, 2019 $ (109.1) $ (40.1) $ 3.6 $ (145.6) Balance as of March 31, 2018 $ (96.6) $ (44.4) $ (3.3) $ (144.3) Other comprehensive income (loss) (16.1) — 9.4 (6.7) Amounts reclassified from AOCI to net income (1) — 0.6 2.5 3.1 Balance as of June 30, 2018 $ (112.7) $ (43.8) $ 8.6 $ (147.9) Cumulative Pension & Other Translation Postretirement Benefit Cash Flow Six Months Ended June 30, 2019 and 2018 Adjustments Plans, Net Hedges, Net Total Balance at December 31, 2018 $ (111.8) $ (39.4) $ 8.9 $ (142.3) Other comprehensive income (loss) 2.7 (2.0) (2.4) (1.7) Amounts reclassified from AOCI to net income (1) — 1.3 (2.9) (1.6) Balance at June 30, 2019 $ (109.1) $ (40.1) $ 3.6 $ (145.6) Balance as of December 31, 2017 $ (94.5) $ (45.0) $ (6.1) $ (145.6) Other comprehensive income (loss) (18.2) — 8.4 (9.8) Amounts reclassified from AOCI to net income (1) — 1.2 6.3 7.5 Balance as of June 30, 2018 $ (112.7) $ (43.8) $ 8.6 $ (147.9) (1) The following is a summary of amounts reclassified from AOCI to net income for the three and six months ended June 30, 2019 and 2018: Three Months Ended Six Months Ended AOCI Components June 30, June 30, Statements of Operations 2019 2018 2019 2018 Classification Cash flow hedging items Foreign exchange cash flow hedges $ (1.6) $ 2.6 $ (2.2) $ 6.3 Cost of sales Interest rate swaps (0.3) (0.1) (0.7) — Interest expense, net Total before tax (1.9) 2.5 (2.9) 6.3 Tax effect — — — — Provision for income taxes Total, net of tax $ (1.9) $ 2.5 $ (2.9) $ 6.3 Amortization of pension and other postretirement benefit plan items Prior service credit $ (0.3) $ (0.2) $ (0.6) $ (0.5) (a) Net actuarial loss 0.8 1.0 1.6 2.2 (a) Net settlement and curtailment loss — — 0.7 — (a) Total before tax 0.5 0.8 1.7 1.7 Tax effect (0.2) (0.2) (0.4) (0.5) Provision for income taxes Total, net of tax $ 0.3 $ 0.6 $ 1.3 $ 1.2 (a) These AOCI components are included in the computation of net periodic benefit costs (see Note 12). ..... |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share | |
Earnings Per Share | NOTE 17—EARNINGS PER SHARE Basic earnings per ordinary share (“basic EPS”) is computed by dividing net income available to ordinary shareholders by the weighted average number of the Company’s ordinary shares outstanding for the applicable period. Diluted earnings per ordinary share (“diluted EPS”) is calculated using net income available to ordinary shareholders divided by diluted weighted average ordinary shares outstanding during each period, which includes unvested RSUs, option awards, and PSUs. Diluted EPS considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential ordinary shares would have an anti-dilutive effect. The following table presents basic EPS and diluted EPS for the three and six months ended June 30, 2019 and 2018: Three Months Ended Six Months Ended June 30, June 30, (in millions, except per share data) 2019 2018 2019 2018 Earnings: Net income $ 28.0 $ 98.3 $ 63.8 $ 218.6 Shares: Weighted average ordinary shares outstanding 40.8 43.1 41.0 43.3 Dilutive effect of RSUs, option awards, and PSUs (1) 0.3 0.7 0.5 0.9 Diluted weighted average ordinary shares outstanding 41.1 43.8 41.5 44.2 Income per share: Income per share—basic $ 0.69 $ 2.28 $ 1.56 $ 5.05 Income per share—diluted $ 0.68 $ 2.24 $ 1.54 $ 4.95 (1) Refer to Note 13 for discussion of RSUs, option awards, and PSUs granted to certain Company directors and employees. The number of anti-dilutive shares that have been excluded from the computation of diluted earnings per share were 0.7 million and 0.8 million for the three and six months ended June 30, 2019, respectively, and 0.4 million and 0.2 million for the three and six months ended June 30, 2018, respectively. . |
Leases
Leases | 6 Months Ended |
Jun. 30, 2019 | |
Lessee Disclosure [Abstract] | |
Leases | NOTE 18—LEASES As discussed in Note 2, effective January 1, 2019, the Company adopted accounting guidance, Topic 842, issued by the FASB related to leases that outlines a comprehensive lease accounting model and supersedes the prior lease guidance. The Company adopted this guidance using the modified retrospective approach and elected the optional transition method. As a result, comparative prior periods in the Company’s financial statements are not adjusted for the impacts of the new standard. The Company’s accounting policy and practical expedient elections related to accounting for leases, including those elected as a result of the adoption of Topic 842, are summarized as follows: ● Package of practical expedients – The Company did not reassess whether expired or existing contracts contain a lease, did not reassess the classification of expired or existing leases, and did not reassess whether lease initial direct costs would qualify for capitalization under the new lease accounting standards. ● Lease and non-lease components as lessee – For leases across all asset classes in which the Company is a lessee (discussed below), the Company did not separate non-lease components from lease components and instead accounted for these items as a single lease component . ● Portfolio approach – The Company elected to utilize the portfolio approach under which it did not have to consider the components to apply lease accounting. Specifically, the Company leveraged the portfolio approach in determining the discount rate within multiple asset classes, and in determining the lease term considerations for immaterial asset classes, including, but not limited to, motor vehicles and plant, office, and information technology equipment. ● Land easements – The Company did not reassess whether existing or expired land easements that were not previously accounted for as leases are or contain a lease under the new lease accounting standards. ● Use of hindsight and short-term lease exemption – The Company did not elect to utilize either the practical expedient related to the use of hindsight or the election to exclude short-term leases from balance sheet presentation. The Company routinely enters into leasing arrangements for a variety of assets including buildings/offices, warehouses and tanks for product storage, railcars and other vehicles for product transportation, motor vehicles, and other equipment. The Company determines if a contract is or contains a lease based on its relevant terms in accordance with Topic 842, including whether it conveys to the Company the right to obtain substantially all the economic benefits of the identified leased asset and to direct its use. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. The Company’s lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the present value of lease payments, the Company uses its incremental borrowing rate based on the information available at the lease commencement date to determine the appropriate discount rate by multiple asset classes, pursuant to the aforementioned portfolio approach methodology. Variable lease payments that are not based on an index or that result from changes to an index subsequent to the initial measurement of the corresponding lease liability are not included in the measurement of lease ROU assets or liabilities and instead are recognized in earnings in the period in which the obligation for those payments is incurred. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise any such options. Lease expense is recognized on a straight ‐ The Company's ROU assets and lease liabilities are classified on its condensed consolidated balance sheets as follows: As of June 30, 2019 Location on Balance Sheet Operating lease ROU assets $ 70.8 Right-of-use assets - operating Finance lease ROU assets 2.0 Property, plant, and equipment, net of accumulated depreciation Operating lease liabilities - current portion (15.5) Current lease liabilities - operating Operating lease liabilities - noncurrent portion (55.6) Noncurrent lease liabilities - operating Finance lease liabilities - current portion (0.5) Short-term borrowings and current portion of long-term debt Finance lease liabilities - noncurrent portion (1.5) Long-term debt, net of unamortized deferred financing fees The components of the Company's lease costs are classified on its condensed consolidated statements of operations as follows: Three Months Ended Six Months Ended June 30, June 30, 2019 2019 Finance lease cost: Amortization of lease ROU assets $ 0.1 $ 0.1 Interest on lease liabilities (1) — — Operating lease cost 4.6 9.1 Variable lease cost (1) — 0.1 Total lease cost $ 4.7 $ 9.3 (1) Where no amounts are presented for the three and six months ended June 30, 2019, amounts totaled less than $0.1 million. The table below shows the cash and non-cash activity related to the Company’s lease liabilities during the period: Three Months Ended Six Months Ended June 30, June 30, 2019 2019 Cash paid related to lease liabilities: Operating cash flows from operating leases $ 4.2 $ 8.0 Operating cash flows from finance leases (1) — — Financing cash flows from finance leases 0.1 0.1 Non-cash lease liability activity (2) : ROU assets obtained in exchange for new operating lease liabilities $ 5.7 $ 78.2 ROU assets obtained in exchange for new finance lease liabilities 1.4 2.1 (1) For the three and six months ended June 30, 2019, amounts totaled less than $0.1 million. (2) Amounts for the six months ended June 30, 2019 include the impact of adopting the new lease accounting standard effective January 1, 2019. As of June 30, 2019, the maturities of the Company's operating and finance lease liabilities were as follows: Maturity of lease liabilities by year Remainder of 2019 2020 2021 2022 2023 Thereafter Total Lease Payments Less Imputed Interest Lease Liability Operating Leases $ 9.3 $ 14.8 $ 9.8 $ 8.3 $ 7.9 $ 36.7 $ 86.8 $ (15.7) $ 71.1 Finance Leases $ 0.3 $ 0.6 $ 0.6 $ 0.3 $ 0.1 $ 0.4 $ 2.3 $ (0.3) $ 2.0 As of June 30, 2019, the weighted average remaining lease term of the Company's operating and finance leases was 9.1 and 6.8 years, respectively, and the weighted average discount rate used to determine the lease liability for operating and finance leases was 4.6% and 4.4%, respectively. As of June 30, 2019, the Company has additional operating leases that have not yet commenced of $6.0 million. The leases will commence in July 2019 with lease terms of 0.5 to 16.0 years. Disclosures related to periods prior to adoption of Topic 842 As discussed above, the Company adopted Topic 842 effective January 1, 2019 using a modified retrospective approach. As required, the following disclosure is provided for periods prior to adoption. The Company’s total future minimum annual rentals in effect at December 31, 2018 for noncancelable operating leases, which were accounted for under the previous leasing standard, Accounting Standards Codification 840, were as follows: Annual Commitment 2019 2020 2021 2022 2023 Thereafter Total $ 17.5 $ 14.4 $ 9.0 $ 10.6 $ 5.4 $ 16.0 $ 72.9 |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2019 | |
Subsequent Events | |
Subsequent Events | NOTE 19—SUBSEQUENT EVENTS On August 6, 2019, new federal income tax legislation was enacted in Switzerland. As a result, the Company anticipates a higher effective tax rate in its entities in Switzerland, beginning in 2020. Additionally, a one-time deferred tax benefit will be recorded in the third quarter of 2019 related to re-measurement of the Company’s deferred tax assets and liabilities in Switzerland due to a change in the enacted Swiss Federal tax rate, which the Company is in the process of quantifying. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Basis of Presentation | |
Basis of Presentation | The unaudited interim condensed consolidated financial statements of Trinseo S.A. and its subsidiaries (the “Company”) as of and for the periods ended June 30, 2019 and 2018 were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and reflect all adjustments, consisting only of normal recurring adjustments, which, in the opinion of management, are considered necessary for the fair statement of the results for the periods presented. Because they cover interim periods, the statements and related notes to the financial statements do not include all disclosures normally provided in annual financial statements, and therefore, these statements should be read in conjunction with the 2018 audited consolidated financial statements included within the Company’s Annual Report The December 31, 2018 condensed consolidated balance sheet data presented herein was derived from the Company’s December 31, 2018 audited consolidated financial statements, but does not include all disclosures required by GAAP for annual periods. The presentation of prior year amounts in the condensed consolidated statements of shareholders’ equity have been updated to conform to the current year presentation. |
Net Sales (Tables)
Net Sales (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue [Table Text Block] | Latex Synthetic Performance Three Months Ended Binders Rubber Plastics Polystyrene Feedstocks Total June 30, 2019 United States $ 67.2 $ — $ 78.4 $ — $ 2.4 $ 148.0 Europe 99.2 112.1 187.3 115.9 33.2 547.7 Asia-Pacific 60.8 — 59.7 91.2 19.3 231.0 Rest of World 3.0 — 22.1 — — 25.1 Total $ 230.2 $ 112.1 $ 347.5 $ 207.1 $ 54.9 $ 951.8 June 30, 2018 United States $ 74.8 $ — $ 82.7 $ — $ 2.9 $ 160.4 Europe 119.1 155.3 245.2 164.6 55.3 739.5 Asia-Pacific 82.6 — 60.9 121.0 43.9 308.4 Rest of World 4.3 — 24.0 — — 28.3 Total $ 280.8 $ 155.3 $ 412.8 $ 285.6 $ 102.1 $ 1,236.6 Latex Synthetic Performance Six Months Ended Binders Rubber Plastics Polystyrene Feedstocks Total June 30, 2019 United States $ 130.5 $ — $ 160.2 $ — $ 5.1 $ 295.8 Europe 200.6 236.7 400.7 254.1 73.6 1,165.7 Asia-Pacific 117.3 — 111.2 181.5 43.0 453.0 Rest of World 5.7 — 44.7 — — 50.4 Total $ 454.1 $ 236.7 $ 716.8 $ 435.6 $ 121.7 $ 1,964.9 June 30, 2018 United States $ 139.1 $ — $ 166.8 $ 0.2 $ 6.6 $ 312.7 Europe 232.6 304.5 494.3 312.6 113.3 1,457.3 Asia-Pacific 156.8 — 108.2 212.4 56.8 534.2 Rest of World 7.6 — 46.3 — — 53.9 Total $ 536.1 $ 304.5 $ 815.6 $ 525.2 $ 176.7 $ 2,358.1 |
Investments in Unconsolidated_2
Investments in Unconsolidated Affiliates (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Investments in Unconsolidated Affiliates | |
Summarized Financial Information of Unconsolidated Affiliates | Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Sales $ 418.4 $ 481.5 $ 787.6 $ 968.1 Gross profit $ 85.9 $ 73.0 $ 140.1 $ 168.2 Net income $ 72.8 $ 58.7 $ 115.7 $ 144.4 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Inventories | |
Schedule of Inventories | June 30, December 31, 2019 2018 Finished goods $ 223.7 $ 269.8 Raw materials and semi-finished goods 199.7 205.8 Supplies 35.1 34.8 Total $ 458.5 $ 510.4 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Debt | |
Schedule of Debt [Table Text Block] | June 30, 2019 December 31, 2018 Interest Rate as of Maturity Date Carrying Amount Unamortized Deferred Financing Fees (1) Total Debt, Less Unamortized Deferred Financing Fees Carrying Amount Unamortized Deferred Financing Fees (1) Total Debt, Less Senior Credit Facility 2024 Term Loan B 4.402% September 2024 $ 687.8 $ (14.9) $ 672.9 $ 691.3 $ (16.2) $ 675.1 2022 Revolving Facility (2) Various September 2022 — — — — — — 2025 Senior Notes 5.375% September 2025 500.0 (7.8) 492.2 500.0 (8.4) 491.6 Accounts Receivable Securitization Facility (3) Various September 2021 — — — — — — Other indebtedness Various Various 4.1 — 4.1 1.1 — 1.1 Total debt $ 1,191.9 $ (22.7) $ 1,169.2 $ 1,192.4 $ (24.6) $ 1,167.8 Less: current portion (4) (8.7) (7.0) Total long-term debt, net of unamortized deferred financing fees $ 1,160.5 $ 1,160.8 (1) This caption does not include deferred financing fees related to the Company’s revolving facilities, which are included within “Deferred charges and other assets” on the condensed consolidated balance sheets. (2) Under the 2022 Revolving Facility, the Company had a capacity of $375.0 million and funds available for borrowing of $360.9 million (net of $14.1 million outstanding letters of credit) as of June 30, 2019. Additionally, the Company is required to pay a quarterly commitment fee in respect of any unused commitments under this facility equal to 0.375% per annum. (3) This facility had a borrowing capacity of $150.0 million as of June 30, 2019. Additionally, as of June 30, 2019, the Company had approximately $134.2 million of accounts receivable available to support this facility, based on the pool of eligible accounts receivable. In regard to outstanding borrowings, fixed interest charges are 1.95% plus variable commercial paper rates, while for available, but undrawn commitments, fixed interest charges are 1.00% (4) As of June 30, 2019 and December 31, 2018, the current portion of long-term debt primarily related to $7.0 million of the scheduled future principal payments on the 2024 Term Loan B. |
Goodwill (Tables)
Goodwill (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Goodwill. | |
Changes in Carrying Amount of Goodwill, by Segment | Latex Synthetic Performance Americas Binders Rubber Plastics Polystyrene Feedstocks Styrenics Total Balance at December 31, 2018 $ 15.9 $ 11.3 $ 37.3 $ 4.5 $ — $ — $ 69.0 Foreign currency impact (0.1) (0.1) (0.1) — — — (0.3) Balance at June 30, 2019 $ 15.8 $ 11.2 $ 37.2 $ 4.5 $ — $ — $ 68.7 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Derivative Instruments [Abstract] | |
Notional Amounts of Most Significant Net Foreign Exchange Hedge Positions Outstanding | June 30, Buy / (Sell) 2019 Euro $ (262.4) Chinese Yuan $ (42.4) Swiss Franc $ 33.4 Mexican Peso $ (15.2) Indonesian Rupiah $ (13.8) |
Schedule of Effect of Derivative Instruments on Statements of Operations | Location and Amount of Gain (Loss) Recognized in Three Months Ended Three Months Ended June 30, 2019 June 30, 2018 Cost of Interest expense, net Other expense, net Cost of Interest expense, net Other expense, net Total amount of income and expense line items presented in the statements of operations in which the effects of derivative instruments are recorded $ 865.6 $ 9.9 $ 1.5 $ 1,073.9 $ 10.8 $ 4.5 The effects of cash flow hedge instruments: Foreign exchange cash flow hedges Amount of gain (loss) reclassified from AOCI into income $ 1.6 $ — $ — $ (2.6) $ — $ — Interest rate swaps Amount of gain reclassified from AOCI into income $ — $ 0.3 $ — $ — $ 0.1 $ — The effects of net investment hedge instruments: Cross currency swaps (CCS) Amount of gain excluded from effectiveness testing $ — $ 3.9 $ — $ — $ 3.9 $ — The effects of derivatives not designated as hedge instruments: Foreign exchange forward contracts Amount of gain (loss) recognized in income $ — $ — $ (2.4) $ — $ — $ 14.1 Location and Amount of Gain (Loss) Recognized in Statements of Operations Six Months Ended Six Months Ended June 30, 2019 June 30, 2018 Cost of Interest expense, net Other expense, net Cost of Interest expense, net Other expense, net Total amount of (income) expense line items presented in the statements of operations in which the effects of derivative instruments are recorded $ 1,781.2 $ 20.1 $ 5.5 $ 2,020.2 $ 25.7 $ 0.8 Effects of cash flow hedge instruments: Foreign exchange cash flow hedges Amount of gain (loss) reclassified from AOCI into income $ 2.2 $ — $ — $ (6.3) $ — $ — Interest rate swaps Amount of gain reclassified from AOCI into income $ — $ 0.7 $ — $ — $ — $ — Effects of net investment hedge instruments: Cross currency swaps (CCS) Amount of gain excluded from effectiveness testing $ — $ 7.9 $ — $ — $ 3.9 $ — Effects of derivatives not designated as hedge instruments: Foreign exchange forward contracts Amount of gain recognized in income $ — $ — $ 0.3 $ — $ — $ 8.8 |
Schedule of Effect of Hedges on AOCI | ` Gain (Loss) Recognized in AOCI on Balance Sheet Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Designated as Cash Flow Hedges Foreign exchange cash flow hedges $ (1.8) $ 10.7 $ 0.5 $ 10.2 Interest rate swaps (3.6) 1.2 (5.8) 4.5 Total $ (5.4) $ 11.9 $ (5.3) $ 14.7 Designated as Net Investment Hedges Cross currency swaps (CCS) $ (3.6) $ 30.8 $ 7.9 $ 10.3 Total $ (3.6) $ 30.8 $ 7.9 $ 10.3 |
Schedule of Gross and Net Unrealized Gains and Losses and Balance Sheet Classification | June 30, 2019 Foreign Foreign Exchange Exchange Interest Cross Balance Sheet Forward Cash Flow Rate Currency Classification Contracts Hedges Swaps Swaps Total Asset Derivatives: Accounts receivable, net of allowance $ 0.9 $ 2.4 $ 0.1 $ 8.3 $ 11.7 Deferred charges and other assets — — 6.8 6.8 Gross derivative asset position 0.9 2.4 0.1 15.1 18.5 Less: Counterparty netting (0.9) — — — (0.9) Net derivative asset position $ — $ 2.4 $ 0.1 $ 15.1 $ 17.6 Liability Derivatives: Accounts payable $ (7.9) $ — $ — $ — $ (7.9) Other noncurrent obligations — — (1.2) — (1.2) Gross derivative liability position (7.9) — (1.2) — (9.1) Less: Counterparty netting 0.8 — — — 0.8 Net derivative liability position $ (7.1) $ — $ (1.2) $ — $ (8.3) Total net derivative position $ (7.1) $ 2.4 $ (1.1) $ 15.1 $ 9.3 December 31, 2018 Foreign Foreign Exchange Exchange Interest Cross Balance Sheet Forward Cash Flow Rate Currency Classification Contracts Hedges Swaps Swaps Total Asset Derivatives: Accounts receivable, net of allowance $ 0.6 $ 1.9 $ 1.5 $ 8.1 $ 12.1 Deferred charges and other assets — — 3.2 — 3.2 Gross derivative asset position 0.6 1.9 4.7 8.1 15.3 Less: Counterparty netting (0.5) — — — (0.5) Net derivative asset position $ 0.1 $ 1.9 $ 4.7 $ 8.1 $ 14.8 Liability Derivatives: Accounts payable $ (2.1) $ — $ — $ — $ (2.1) Other noncurrent obligations — — — (3.4) (3.4) Gross derivative liability position (2.1) — — (3.4) (5.5) Less: Counterparty netting 0.5 — — — 0.5 Net derivative liability position $ (1.6) $ — $ — $ (3.4) $ (5.0) Total net derivative position $ (1.5) $ 1.9 $ 4.7 $ 4.7 $ 9.8 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value Measurements | |
Schedule of Assets and Liabilities at Fair Value on Recurring Basis | June 30, 2019 Quoted Prices in Active Markets for Identical Items Significant Other Observable Inputs Significant Unobservable Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—(Liabilities) — (7.1) — (7.1) Foreign exchange cash flow hedges—Assets — 2.4 — 2.4 Interest rate swaps—Assets — 0.1 — 0.1 Interest rate swaps—(Liabilities) — (1.2) — (1.2) Cross currency swaps—Assets — 15.1 — 15.1 Total fair value $ — $ 9.3 $ — $ 9.3 December 31, 2018 Quoted Prices in Active Markets for Identical Items Significant Other Observable Inputs Significant Unobservable Inputs Assets (Liabilities) at Fair Value (Level 1) (Level 2) (Level 3) Total Foreign exchange forward contracts—Assets $ — $ 0.1 $ — $ 0.1 Foreign exchange forward contracts—(Liabilities) — (1.6) — (1.6) Foreign exchange cash flow hedges—Assets — 1.9 — 1.9 Interest rate swaps—Assets — 4.7 — 4.7 Cross currency swaps—Assets — 8.1 — 8.1 Cross currency swaps—(Liabilities) — (3.4) — (3.4) Total fair value $ — $ 9.8 $ — $ 9.8 |
Estimated Fair Value of Outstanding Debt Not Carried at Fair Value | As of As of June 30, 2019 December 31, 2018 2025 Senior Notes $ 482.3 $ 438.3 2024 Term Loan B 681.3 658.9 Total fair value $ 1,163.6 $ 1,097.2 |
Provision for Income Taxes (Tab
Provision for Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Provision for Income Taxes | |
Schedule of Effective Tax Rate | Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Effective income tax rate 36.0 % 17.2 % 29.3 % 17.2 % |
Pension Plans and Other Postr_2
Pension Plans and Other Postretirement Benefits (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Pension Plans and Other Postretirement Benefits | |
Schedule of Net Periodic Benefit Costs | Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Defined Benefit Pension Plans Service cost $ 3.1 $ 3.1 $ 6.3 $ 6.2 Interest cost 1.2 1.2 2.5 2.5 Expected return on plan assets (0.5) (0.5) (1.0) (1.1) Amortization of prior service credit (0.3) (0.3) (0.5) (0.6) Amortization of net loss 0.8 0.9 1.5 1.9 Net settlement and curtailment loss — — 0.7 — Net periodic benefit cost $ 4.3 $ 4.4 $ 9.5 $ 8.9 Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Other Postretirement Plans Service cost $ — $ — $ 0.1 $ 0.1 Interest cost 0.1 0.1 0.1 0.1 Amortization of prior service cost — — — 0.1 Amortization of net gain (0.1) — (0.2) — Net periodic benefit cost $ — $ 0.1 $ — $ 0.3 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of Share-Based Compensation Expense and Unrecognized Compensation Cost | As of Three Months Ended Six Months Ended June 30, 2019 June 30, June 30, Unrecognized Weighted 2019 2018 2019 2018 Compensation Cost Average Years RSUs $ 1.9 $ 2.1 $ 4.0 $ 4.3 $ 13.9 2.2 Options 0.8 0.6 2.0 3.4 2.8 1.6 PSUs 0.8 0.7 1.7 1.2 5.9 2.3 Total share-based compensation expense $ 3.5 $ 3.4 $ 7.7 $ 8.9 |
Summary of Awards Granted and Weighted Average Grant-Date Fair Value | Six Months Ended June 30, 2019 Awards Granted Weighted Average Grant Date Fair Value per Award RSUs 236,156 $ 48.63 Options 237,071 15.40 PSUs 117,053 54.01 |
Option Awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of Weighted-average Assumptions | Six Months Ended June 30, 2019 Expected term (in years) 5.50 Expected volatility 36.00 % Risk-free interest rate 2.53 % Dividend yield 2.00 % |
Performance Share Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of Weighted-average Assumptions | Six Months Ended June 30, 2019 Expected term (in years) 3.00 Expected volatility 36.40 % Risk-free interest rate 2.58 % Share Price $ 50.95 |
Segments (Tables)
Segments (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Segments | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Latex Synthetic Performance Americas Three Months Ended (1) Binders Rubber Plastics Polystyrene Feedstocks Styrenics June 30, 2019 $ 20.6 $ 12.9 $ 34.2 $ 16.2 $ (0.6) $ 40.3 June 30, 2018 $ 36.0 $ 30.6 $ 48.9 $ 13.7 $ 32.4 $ 33.2 Latex Synthetic Performance Americas Six Months Ended Binders Rubber Plastics Polystyrene Feedstocks Styrenics June 30, 2019 $ 38.1 $ 21.7 $ 69.9 $ 32.9 $ 16.6 $ 72.5 June 30, 2018 $ 63.5 $ 56.2 $ 114.3 $ 23.3 $ 73.9 $ 78.8 (1) The Company’s primary measure of segment operating performance is Adjusted EBITDA, which is defined as income from continuing operations before interest expense, net; provision for income taxes; depreciation and amortization expense; loss on extinguishment of long-term debt; asset impairment charges; gains or losses on the dispositions of businesses and assets; restructuring charges; acquisition related costs and other items. Segment Adjusted EBITDA is a key metric that is used by management to evaluate business performance in comparison to budgets, forecasts, and prior year financial results, providing a measure that management believes reflects core operating performance by removing the impact of transactions and events that would not be considered a part of core operations. Other companies in the industry may define segment Adjusted EBITDA differently than the Company, and as a result, it may be difficult to use segment Adjusted EBITDA, or similarly named financial measures, that other companies may use to compare the performance of those companies to the Company’s segment performance. |
Reconciliation of IBT to Adjusted EBITDA | Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Income before income taxes $ 43.7 $ 118.7 $ 90.3 $ 263.9 Interest expense, net 9.9 10.8 20.1 25.7 Depreciation and amortization 34.7 32.3 68.7 64.3 Corporate Unallocated (2) 20.8 24.6 46.9 44.9 Adjusted EBITDA Addbacks (3) 14.5 8.4 25.7 11.2 Segment Adjusted EBITDA $ 123.6 $ 194.8 $ 251.7 $ 410.0 (2) Corporate unallocated includes corporate overhead costs and certain other income and expenses. (3) Adjusted EBITDA addbacks for the three and six months ended June 30, 2019 and 2018 are as follows: Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Loss on extinguishment of long-term debt $ — $ 0.2 $ — $ 0.2 Net gain on disposition of businesses and assets — — (0.2) (0.5) Restructuring and other charges (Note 15) (0.3) 1.2 0.1 1.7 Acquisition, transaction, and integration costs (a) 0.7 0.2 0.7 0.6 Other items (b) 14.1 6.8 25.1 9.2 Total Adjusted EBITDA Addbacks $ 14.5 $ 8.4 $ 25.7 $ 11.2 (a) Acquisition, transaction, and integration costs for the three and six months ended June 30, 2019 and 2018 primarily relate to advisory and professional fees incurred in conjunction with the Company’s acquisition of production assets in Rheinmünster, Germany and its acquisition of API Plastics, respectively. (b) Other items for the three and six months ended June 30, 2019 and 2018 primarily relate to advisory and professional fees incurred in conjunction with the Company’s initiative to transition business services from Dow, including certain administrative services such as accounts payable, logistics, and IT services. Also included within other items for the three and six months ended June 30, 2019 are fees incurred in conjunction with certain of the Company’s strategic initiatives. |
Restructuring (Tables)
Restructuring (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Restructuring | |
Detail of Restructuring Charges | Three Months Ended Six Months Ended Cumulative June 30, June 30, Life-to-date 2019 2018 2019 2018 Charges Segment Terneuzen Compounding Restructuring (1) Asset impairment/accelerated depreciation $ — $ 0.3 $ — $ 0.6 $ 3.1 Employee termination benefits (0.4) 0.2 (0.4) 0.3 0.6 Contract terminations — — — — 0.3 Decommissioning and other — 0.2 0.2 0.2 1.6 Terneuzen Subtotal $ (0.4) $ 0.7 $ (0.2) $ 1.1 $ 5.6 Performance Plastics Livorno Plant Restructuring (2) Asset impairment/accelerated depreciation $ — $ 0.4 $ — $ 0.4 $ 14.7 Employee termination benefits — — — — 5.4 Contract terminations — — — — 0.3 Decommissioning and other 0.1 0.1 0.3 0.4 4.0 Livorno Subtotal $ 0.1 $ 0.5 $ 0.3 $ 0.8 $ 24.4 Latex Binders Other Restructurings — 0.3 — 0.4 Various Total Restructuring Charges $ (0.3) $ 1.5 $ 0.1 $ 2.3 (1) In March 2017, the Company announced plans to upgrade its production capability for compounded resins with the construction of a new state-of-the art compounding facility to replace its existing compounding facility in Terneuzen, The Netherlands. As of June 30, 2019, the new facility is complete, noting certain ongoing quality assurance activities. Substantive production at the prior facility ceased and decommissioning activities began during the second quarter of 2019, which are expected to continue through 2020. The Company estimates it will incur decommissioning and other charges of approximately $0.6 million throughout 2019 and 2020, the majority of which are expected to be paid during the remainder of 2019 and the first half of 2020. (2) In August 2016, the Company announced its plan to cease manufacturing activities at its latex binders manufacturing facility in Livorno, Italy. Production at the facility ceased in October 2016 and decommissioning activities began in the fourth quarter of 2016. In June 2018, the Company entered into a preliminary agreement to sell the land where the former facility is located, subject to certain activities being completed prior to closing. The sale is considered probable to close within one year following the balance sheet date; therefore, as of both June 30, 2019 and December 31, 2018, the land is recorded as held-for-sale within “Other current assets” at a value of $12.0 million and the deferred tax liability associated with that land is recorded as held-for-sale within “Accrued expenses and other current liabilities” at a value of $2.9 million on the Company’s condensed consolidated balance sheets. In conjunction with the execution of this agreement, the Company received $1.3 million of the purchase price as a prepayment, which is recorded within “Accrued expenses and other current liabilities” on the condensed consolidated balance sheets as of June 30, 2019 and December 31, 2018. The Company expects to incur a limited amount of additional decommissioning costs associated with this plant shutdown through the closing date of the sale, which will be expensed as incurred. |
Rollforward of Liability Balances | Balance at Balance at December 31, 2018 Expenses Deductions (1) June 30, 2019 Employee termination benefits $ 6.4 $ (0.3) $ (4.9) $ 1.2 Contract terminations 0.3 — — 0.3 Decommissioning and other — 0.4 (0.4) — Total $ 6.7 $ 0.1 $ (5.3) $ 1.5 (1) Primarily includes payments made against the existing accrual, as well as immaterial impacts of foreign currency remeasurement. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Shareholders' Equity. | |
Components of AOCI, Net of Income Taxes | Cumulative Pension & Other Translation Postretirement Benefit Cash Flow Three Months Ended June 30, 2019 and 2018 Adjustments Plans, Net Hedges, Net Total Balance as of March 31, 2019 $ (112.1) $ (40.4) $ 9.0 $ (143.5) Other comprehensive income (loss) 3.0 — (3.5) (0.5) Amounts reclassified from AOCI to net income (loss) (1) — 0.3 (1.9) (1.6) Balance as of June 30, 2019 $ (109.1) $ (40.1) $ 3.6 $ (145.6) Balance as of March 31, 2018 $ (96.6) $ (44.4) $ (3.3) $ (144.3) Other comprehensive income (loss) (16.1) — 9.4 (6.7) Amounts reclassified from AOCI to net income (1) — 0.6 2.5 3.1 Balance as of June 30, 2018 $ (112.7) $ (43.8) $ 8.6 $ (147.9) Cumulative Pension & Other Translation Postretirement Benefit Cash Flow Six Months Ended June 30, 2019 and 2018 Adjustments Plans, Net Hedges, Net Total Balance at December 31, 2018 $ (111.8) $ (39.4) $ 8.9 $ (142.3) Other comprehensive income (loss) 2.7 (2.0) (2.4) (1.7) Amounts reclassified from AOCI to net income (1) — 1.3 (2.9) (1.6) Balance at June 30, 2019 $ (109.1) $ (40.1) $ 3.6 $ (145.6) Balance as of December 31, 2017 $ (94.5) $ (45.0) $ (6.1) $ (145.6) Other comprehensive income (loss) (18.2) — 8.4 (9.8) Amounts reclassified from AOCI to net income (1) — 1.2 6.3 7.5 Balance as of June 30, 2018 $ (112.7) $ (43.8) $ 8.6 $ (147.9) |
Reclassification out of Accumulated Other Comprehensive Income [Table Text Block] | Three Months Ended Six Months Ended AOCI Components June 30, June 30, Statements of Operations 2019 2018 2019 2018 Classification Cash flow hedging items Foreign exchange cash flow hedges $ (1.6) $ 2.6 $ (2.2) $ 6.3 Cost of sales Interest rate swaps (0.3) (0.1) (0.7) — Interest expense, net Total before tax (1.9) 2.5 (2.9) 6.3 Tax effect — — — — Provision for income taxes Total, net of tax $ (1.9) $ 2.5 $ (2.9) $ 6.3 Amortization of pension and other postretirement benefit plan items Prior service credit $ (0.3) $ (0.2) $ (0.6) $ (0.5) (a) Net actuarial loss 0.8 1.0 1.6 2.2 (a) Net settlement and curtailment loss — — 0.7 — (a) Total before tax 0.5 0.8 1.7 1.7 Tax effect (0.2) (0.2) (0.4) (0.5) Provision for income taxes Total, net of tax $ 0.3 $ 0.6 $ 1.3 $ 1.2 (a) These AOCI components are included in the computation of net periodic benefit costs (see Note 12). |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share | |
Schedule of Earnings per Share Basic and Diluted | Three Months Ended Six Months Ended June 30, June 30, (in millions, except per share data) 2019 2018 2019 2018 Earnings: Net income $ 28.0 $ 98.3 $ 63.8 $ 218.6 Shares: Weighted average ordinary shares outstanding 40.8 43.1 41.0 43.3 Dilutive effect of RSUs, option awards, and PSUs (1) 0.3 0.7 0.5 0.9 Diluted weighted average ordinary shares outstanding 41.1 43.8 41.5 44.2 Income per share: Income per share—basic $ 0.69 $ 2.28 $ 1.56 $ 5.05 Income per share—diluted $ 0.68 $ 2.24 $ 1.54 $ 4.95 (1) Refer to Note 13 for discussion of RSUs, option awards, and PSUs granted to certain Company directors and employees. The number of anti-dilutive shares that have been excluded from the computation of diluted earnings per share were 0.7 million and 0.8 million for the three and six months ended June 30, 2019, respectively, and 0.4 million and 0.2 million for the three and six months ended June 30, 2018, respectively. . |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Lessee Disclosure [Abstract] | |
Schedule of ROU Assets and Lease Liabilities | As of June 30, 2019 Location on Balance Sheet Operating lease ROU assets $ 70.8 Right-of-use assets - operating Finance lease ROU assets 2.0 Property, plant, and equipment, net of accumulated depreciation Operating lease liabilities - current portion (15.5) Current lease liabilities - operating Operating lease liabilities - noncurrent portion (55.6) Noncurrent lease liabilities - operating Finance lease liabilities - current portion (0.5) Short-term borrowings and current portion of long-term debt Finance lease liabilities - noncurrent portion (1.5) Long-term debt, net of unamortized deferred financing fees |
Schedule of Lease Costs | Three Months Ended Six Months Ended June 30, June 30, 2019 2019 Finance lease cost: Amortization of lease ROU assets $ 0.1 $ 0.1 Interest on lease liabilities (1) — — Operating lease cost 4.6 9.1 Variable lease cost (1) — 0.1 Total lease cost $ 4.7 $ 9.3 (1) Where no amounts are presented for the three and six months ended June 30, 2019, amounts totaled less than $0.1 million. The table below shows the cash and non-cash activity related to the Company’s lease liabilities during the period: Three Months Ended Six Months Ended June 30, June 30, 2019 2019 Cash paid related to lease liabilities: Operating cash flows from operating leases $ 4.2 $ 8.0 Operating cash flows from finance leases (1) — — Financing cash flows from finance leases 0.1 0.1 Non-cash lease liability activity (2) : ROU assets obtained in exchange for new operating lease liabilities $ 5.7 $ 78.2 ROU assets obtained in exchange for new finance lease liabilities 1.4 2.1 (1) For the three and six months ended June 30, 2019, amounts totaled less than $0.1 million. (2) Amounts for the six months ended June 30, 2019 include the impact of adopting the new lease accounting standard effective January 1, 2019. |
Schedule of Maturity of Operating Lease Liabilities ASC842 | Maturity of lease liabilities by year Remainder of 2019 2020 2021 2022 2023 Thereafter Total Lease Payments Less Imputed Interest Lease Liability Operating Leases $ 9.3 $ 14.8 $ 9.8 $ 8.3 $ 7.9 $ 36.7 $ 86.8 $ (15.7) $ 71.1 Finance Leases $ 0.3 $ 0.6 $ 0.6 $ 0.3 $ 0.1 $ 0.4 $ 2.3 $ (0.3) $ 2.0 |
Schedule of Future Minimum Rental Payments under Operating Leases ASC840 | Annual Commitment 2019 2020 2021 2022 2023 Thereafter Total $ 17.5 $ 14.4 $ 9.0 $ 10.6 $ 5.4 $ 16.0 $ 72.9 |
Recent Accounting Guidance (Det
Recent Accounting Guidance (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right of use assets - operating | $ 70.8 | ||
Operating lease liability | $ 71.1 | ||
Adoption of new accounting standard | $ 0 | ||
Accounting Standards Update 2016-02 [Member] | Restatement Adjustment [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right of use assets - operating | $ 73 | ||
Operating lease liability | $ 72.4 |
Net Sales (Details)
Net Sales (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 951.8 | $ 1,236.6 | $ 1,964.9 | $ 2,358.1 |
Latex Binders Segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 230.2 | 280.8 | 454.1 | 536.1 |
Synthetic Rubber Segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 112.1 | 155.3 | 236.7 | 304.5 |
Performance Plastics Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 347.5 | 412.8 | 716.8 | 815.6 |
Polystyrene [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 207.1 | 285.6 | 435.6 | 525.2 |
Feedstocks [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 54.9 | 102.1 | 121.7 | 176.7 |
United States [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 148 | 160.4 | 295.8 | 312.7 |
United States [Member] | Latex Binders Segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 67.2 | 74.8 | 130.5 | 139.1 |
United States [Member] | Performance Plastics Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 78.4 | 82.7 | 160.2 | 166.8 |
United States [Member] | Polystyrene [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0.2 | |||
United States [Member] | Feedstocks [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2.4 | 2.9 | 5.1 | 6.6 |
Europe [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 547.7 | 739.5 | 1,165.7 | 1,457.3 |
Europe [Member] | Latex Binders Segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 99.2 | 119.1 | 200.6 | 232.6 |
Europe [Member] | Synthetic Rubber Segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 112.1 | 155.3 | 236.7 | 304.5 |
Europe [Member] | Performance Plastics Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 187.3 | 245.2 | 400.7 | 494.3 |
Europe [Member] | Polystyrene [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 115.9 | 164.6 | 254.1 | 312.6 |
Europe [Member] | Feedstocks [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 33.2 | 55.3 | 73.6 | 113.3 |
Asia-Pacific [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 231 | 308.4 | 453 | 534.2 |
Asia-Pacific [Member] | Latex Binders Segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 60.8 | 82.6 | 117.3 | 156.8 |
Asia-Pacific [Member] | Performance Plastics Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 59.7 | 60.9 | 111.2 | 108.2 |
Asia-Pacific [Member] | Polystyrene [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 91.2 | 121 | 181.5 | 212.4 |
Asia-Pacific [Member] | Feedstocks [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 19.3 | 43.9 | 43 | 56.8 |
Rest of World [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 25.1 | 28.3 | 50.4 | 53.9 |
Rest of World [Member] | Latex Binders Segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 3 | 4.3 | 5.7 | 7.6 |
Rest of World [Member] | Performance Plastics Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 22.1 | $ 24 | $ 44.7 | $ 46.3 |
Investments in Unconsolidated_3
Investments in Unconsolidated Affiliates - Summarized Financial Information (Details) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019USD ($)item | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)item | Jun. 30, 2018USD ($) | |
Investments in Unconsolidated Affiliates - Summarized Information | ||||
Number of joint ventures | item | 1 | 1 | ||
Summarized Financial Information, Net Income | ||||
Sales | $ 418.4 | $ 481.5 | $ 787.6 | $ 968.1 |
Gross profit | 85.9 | 73 | 140.1 | 168.2 |
Net income | $ 72.8 | $ 58.7 | $ 115.7 | $ 144.4 |
Investments in Unconsolidated_4
Investments in Unconsolidated Affiliates - Detail (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Investments in Unconsolidated Affiliates | |||||
Investments in unconsolidated affiliates | $ 199.1 | $ 199.1 | $ 179.1 | ||
Americas Styrenics | |||||
Investments in Unconsolidated Affiliates | |||||
Investments in unconsolidated affiliates | 199.1 | 199.1 | 179.1 | ||
Investment in unconsolidated affiliates-difference between carrying amount and underlying equity | $ 18.9 | $ 18.9 | $ 46.4 | ||
Percentage of ownership underlying net assets | 50.00% | 50.00% | 50.00% | ||
Amortized weighted average remaining useful life | 1.7 | ||||
Dividends received from operating activities | $ 40 | $ 37.5 | $ 52.5 | $ 67.5 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Inventories | ||
Finished goods | $ 223.7 | $ 269.8 |
Raw materials and semi-finished goods | 199.7 | 205.8 |
Supplies | 35.1 | 34.8 |
Total | $ 458.5 | $ 510.4 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Sep. 01, 2017 | |
Debt Instruments | ||||||
Carrying amount | $ 1,191.9 | $ 1,191.9 | $ 1,192.4 | |||
Unamortized deferred financing fees | (22.7) | (22.7) | (24.6) | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | 1,169.2 | 1,169.2 | 1,167.8 | |||
Less: current portion | (8.7) | (8.7) | (7) | |||
Total long-term debt, net of unamortized deferred financing fees | 1,160.5 | 1,160.5 | 1,160.8 | |||
Interest and Debt Expense [Abstract] | ||||||
Interest expense, net | 9.9 | $ 10.8 | 20.1 | $ 25.7 | ||
2022 Revolving Facility | ||||||
Debt Instruments | ||||||
Funds available for borrowings | 360.9 | 360.9 | ||||
Letters of credit, amount outstanding | 14.1 | $ 14.1 | ||||
Commitment fee (as a percent) | 0.375% | |||||
Maximum borrowing capacity | $ 375 | $ 375 | ||||
2024 Term Loan B | ||||||
Debt Instruments | ||||||
Interest rate | 4.402% | 4.402% | ||||
Carrying amount | $ 687.8 | $ 687.8 | 691.3 | |||
Unamortized deferred financing fees | (14.9) | (14.9) | (16.2) | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | 672.9 | 672.9 | 675.1 | |||
Less: current portion | $ (7) | $ (7) | (7) | |||
2024 Term Loan B | LIBOR [Member] | ||||||
Debt Instruments | ||||||
Debt instrument, margin rate | 2.00% | |||||
2025 Senior Notes | ||||||
Debt Instruments | ||||||
Interest rate | 5.375% | 5.375% | 5.375% | |||
Carrying amount | $ 500 | $ 500 | 500 | |||
Unamortized deferred financing fees | (7.8) | (7.8) | (8.4) | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | 492.2 | 492.2 | 491.6 | |||
Accounts Receivable Securitization Facility [Member] | ||||||
Debt Instruments | ||||||
Carrying amount | 0 | 0 | 0 | |||
Unamortized deferred financing fees | 0 | 0 | 0 | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | 0 | $ 0 | 0 | |||
Commitment fee (as a percent) | 1.00% | |||||
Maximum borrowing capacity | 150 | $ 150 | ||||
Accounts receivable available to support facility | $ 134.2 | $ 134.2 | ||||
Accounts Receivable Securitization Facility [Member] | Base Rate [Member] | ||||||
Debt Instruments | ||||||
Interest rate | 1.95% | 1.95% | ||||
Other Indebtedness [Member] | ||||||
Debt Instruments | ||||||
Carrying amount | $ 4.1 | $ 4.1 | 1.1 | |||
Total Debt, Less Unamortized Deferred Financing Fees, Current and Noncurrent | $ 4.1 | $ 4.1 | $ 1.1 |
Goodwill (Details)
Goodwill (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Goodwill [Roll Forward] | |
Beginning Balance | $ 69 |
Foreign currency impact | (0.3) |
Ending Balance | 68.7 |
Latex Binders Segment | |
Goodwill [Roll Forward] | |
Beginning Balance | 15.9 |
Foreign currency impact | (0.1) |
Ending Balance | 15.8 |
Synthetic Rubber Segment | |
Goodwill [Roll Forward] | |
Beginning Balance | 11.3 |
Foreign currency impact | (0.1) |
Ending Balance | 11.2 |
Performance Plastics Segment [Member] | |
Goodwill [Roll Forward] | |
Beginning Balance | 37.3 |
Foreign currency impact | (0.1) |
Ending Balance | 37.2 |
Polystyrene [Member] | |
Goodwill [Roll Forward] | |
Beginning Balance | 4.5 |
Ending Balance | $ 4.5 |
Derivative Instruments (Details
Derivative Instruments (Details) € in Millions | Sep. 01, 2017USD ($) | Jun. 30, 2019USD ($)item | Dec. 31, 2018USD ($) | Jun. 30, 2018USD ($) | Apr. 01, 2018USD ($) | Sep. 01, 2017EUR (€) |
Derivative Instruments | ||||||
Total debt | $ 1,169,200,000 | $ 1,167,800,000 | ||||
Cumulative foreign currency translation loss | $ 0 | |||||
Foreign Exchange Forward Contracts | ||||||
Derivative Instruments | ||||||
Derivative term | 2 months | |||||
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments - Economic | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | $ 403,800,000 | |||||
Foreign Exchange Forward Contracts | Designated as Hedging Instrument | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | $ 71,400,000 | |||||
Derivative term | 6 months | |||||
Number of subsidiaries participating | item | 1 | |||||
Cross Currency Swap | Net Investment Hedges | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | € | € 420 | |||||
Derivative term | 5 years | |||||
Cross currency swap weighted average interest rate (as a percent) | 3.45% | |||||
Amount hedged | $ 500,000,000 | |||||
Cumulative translation adjustment, net of tax | $ 38,000,000 | |||||
Initial excluded component value | $ 23,600,000 | |||||
Interest Rate Swap | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | $ 200,000,000 | |||||
Fixed interest rate per agreement (as a percent) | 1.81% | |||||
LIBOR rate at end of period (as a percent) | 2.40% | |||||
2025 Senior Notes | ||||||
Derivative Instruments | ||||||
Total debt | $ 492,200,000 | 491,600,000 | ||||
Interest rate | 5.375% | 5.375% | 5.375% | |||
2024 Term Loan B | ||||||
Derivative Instruments | ||||||
Total debt | $ 672,900,000 | $ 675,100,000 | ||||
Interest rate | 4.402% | |||||
2024 Term Loan B | LIBOR [Member] | ||||||
Derivative Instruments | ||||||
Debt instrument, margin rate | 2.00% | |||||
Variable rate floor (as a percent) | 0.00% | |||||
Euro [Member] | Foreign Exchange Forward Contracts | Sell | Not Designated as Hedging Instruments - Economic | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | $ 262,400,000 | |||||
Chinese Yuan [Member] | Foreign Exchange Forward Contracts | Sell | Not Designated as Hedging Instruments - Economic | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | 42,400,000 | |||||
Swiss Franc [Member] | Foreign Exchange Forward Contracts | Buy | Not Designated as Hedging Instruments - Economic | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | 33,400,000 | |||||
Mexico, Pesos | Foreign Exchange Forward Contracts | Sell | Not Designated as Hedging Instruments - Economic | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | 15,200,000 | |||||
Indonesian Rupiah [Member] | Foreign Exchange Forward Contracts | Sell | Not Designated as Hedging Instruments - Economic | ||||||
Derivative Instruments | ||||||
Derivative contracts, notional amount | $ 13,800,000 |
Derivative Instruments - Income
Derivative Instruments - Income Statements (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Cost of sales | $ 865.6 | $ 1,073.9 | $ 1,781.2 | $ 2,020.2 |
Interest expense, net | 9.9 | 10.8 | 20.1 | 25.7 |
Other expense, net | 1.5 | 4.5 | 5.5 | 0.8 |
Cost of Sales | ||||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Cost of sales | 865.6 | 1,781.2 | 2,020.2 | |
Interest Expense, Net | ||||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Interest expense, net | 9.9 | 10.8 | (20.1) | (25.7) |
Other Expense, Net | ||||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Other expense, net | 1.5 | 4.5 | (5.5) | (0.8) |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments - Economic | Other Expense, Net | ||||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Amount of gain recognized in income, not designated | (2.4) | 14.1 | 0.3 | 8.8 |
Foreign Exchange Forward Contracts | Designated as Hedging Instrument | ||||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Amount of gain (loss) reclassified from AOCI into income, foreign exchange cash flow hedges | (2.6) | |||
Foreign Exchange Forward Contracts | Designated as Hedging Instrument | Cost of Sales | ||||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Amount of gain (loss) reclassified from AOCI into income, foreign exchange cash flow hedges | 1.6 | 2.2 | (6.3) | |
Cross Currency Swap | Interest Expense, Net | ||||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Amount of gain excluded from effectiveness testing | 3.9 | 3.9 | 7.9 | $ 3.9 |
Interest Rate Swap | Interest Expense, Net | ||||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Amount of gain (loss) reclassified from AOCI into income, interest rate cash flow hedges | $ 0.3 | $ 0.1 | $ 0.7 |
Derivative Instruments - Effect
Derivative Instruments - Effect on AOCI (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Derivative Instruments | ||||
Gain (Loss) Recognized in AOCI, Cash flow hedges - post adoption | $ (5.4) | $ 11.9 | $ (5.3) | $ 14.7 |
Gain (Loss) Recognized in AOCI, Net investment hedges | (3.6) | 30.8 | 7.9 | 10.3 |
Foreign Exchange Forward Contracts | ||||
Derivative Instruments | ||||
Gain (Loss) Recognized in AOCI, Cash flow hedges - post adoption | (1.8) | 10.7 | 0.5 | 10.2 |
Cross Currency Swap | ||||
Derivative Instruments | ||||
Gain (Loss) Recognized in AOCI, Net investment hedges | (3.6) | 30.8 | 7.9 | 10.3 |
Interest Rate Swap | ||||
Derivative Instruments | ||||
Gain (Loss) Recognized in AOCI, Cash flow hedges - post adoption | $ (3.6) | $ 1.2 | $ (5.8) | $ 4.5 |
Derivative Instruments - Gains
Derivative Instruments - Gains and Losses (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Foreign exchange transaction gains (losses) | $ 2,600,000 | $ (16,100,000) | $ (500,000) | $ (5,700,000) |
Information regarding changes in fair value of derivatives | ||||
Current foreign currency translation gain | 0 | |||
Maximum | ||||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Reclassification expected during next 12 months | 2,500,000 | |||
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments - Economic | ||||
Derivative, Gain (Loss) on Derivative, Net [Abstract] | ||||
Gain (loss) from settlements and changes in fair value | $ (2,400,000) | $ 14,100,000 | $ 300,000 | $ 8,800,000 |
Derivative Instruments - Financ
Derivative Instruments - Financial Assets and Liabilities (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | $ 18.5 | $ 15.3 |
Counterparty netting, derivative assets | (0.9) | (0.5) |
Net derivative asset position | 17.6 | 14.8 |
Gross derivative liability position | (9.1) | (5.5) |
Counterparty netting, derivative liabilities | 0.8 | 0.5 |
Net derivative liability position | (8.3) | (5) |
Total net derivative position | 9.3 | 9.8 |
Accounts Receivable | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 11.7 | 12.1 |
Deferred Charges and Other Assets | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 6.8 | 3.2 |
Accounts Payable | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative liability position | (7.9) | (2.1) |
Other Noncurrent Obligations | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative liability position | (1.2) | (3.4) |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments - Economic | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 0.9 | 0.6 |
Counterparty netting, derivative assets | (0.9) | (0.5) |
Net derivative asset position | 0.1 | |
Gross derivative liability position | (7.9) | (2.1) |
Counterparty netting, derivative liabilities | 0.8 | 0.5 |
Net derivative liability position | (7.1) | (1.6) |
Total net derivative position | (7.1) | (1.5) |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments - Economic | Accounts Receivable | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 0.9 | 0.6 |
Foreign Exchange Forward Contracts | Not Designated as Hedging Instruments - Economic | Accounts Payable | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative liability position | (7.9) | (2.1) |
Foreign Exchange Forward Contracts | Designated as Hedging Instrument | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 2.4 | 1.9 |
Net derivative asset position | 2.4 | 1.9 |
Total net derivative position | 2.4 | 1.9 |
Foreign Exchange Forward Contracts | Designated as Hedging Instrument | Accounts Receivable | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 2.4 | 1.9 |
Interest Rate Swap | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 0.1 | 4.7 |
Net derivative asset position | 0.1 | 4.7 |
Gross derivative liability position | (1.2) | |
Net derivative liability position | (1.2) | |
Total net derivative position | (1.1) | 4.7 |
Interest Rate Swap | Accounts Receivable | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 0.1 | 1.5 |
Interest Rate Swap | Deferred Charges and Other Assets | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 3.2 | |
Interest Rate Swap | Other Noncurrent Obligations | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative liability position | (1.2) | |
Cross Currency Swap | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 15.1 | 8.1 |
Net derivative asset position | 15.1 | 8.1 |
Gross derivative liability position | (3.4) | |
Net derivative liability position | (3.4) | |
Total net derivative position | 15.1 | 4.7 |
Cross Currency Swap | Accounts Receivable | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | 8.3 | 8.1 |
Cross Currency Swap | Deferred Charges and Other Assets | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative asset position | $ 6.8 | |
Cross Currency Swap | Other Noncurrent Obligations | ||
Derivatives, Financial Assets and Liabilities | ||
Gross derivative liability position | $ (3.4) |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities at Fair Value, Recurring (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Fair Value Measurements | ||
Total net derivative position | $ 9.3 | $ 9.8 |
Interest Rate Swap | ||
Fair Value Measurements | ||
Total net derivative position | (1.1) | 4.7 |
Cross Currency Swap | ||
Fair Value Measurements | ||
Total net derivative position | 15.1 | 4.7 |
Designated as Hedging Instrument | Foreign Exchange Forward Contracts | ||
Fair Value Measurements | ||
Total net derivative position | 2.4 | 1.9 |
Not Designated as Hedging Instruments - Economic | Foreign Exchange Forward Contracts | ||
Fair Value Measurements | ||
Total net derivative position | (7.1) | (1.5) |
Recurring | ||
Fair Value Measurements | ||
Total net derivative position | 9.3 | 9.8 |
Recurring | Interest Rate Swap | ||
Fair Value Measurements | ||
Assets at fair value | 0.1 | 4.7 |
Liabilities at fair value | (1.2) | |
Recurring | Cross Currency Swap | ||
Fair Value Measurements | ||
Assets at fair value | 15.1 | 8.1 |
Liabilities at fair value | (3.4) | |
Recurring | Significant Other Observable Inputs (Level 2) | ||
Fair Value Measurements | ||
Total net derivative position | 9.3 | 9.8 |
Recurring | Significant Other Observable Inputs (Level 2) | Interest Rate Swap | ||
Fair Value Measurements | ||
Assets at fair value | 0.1 | 4.7 |
Liabilities at fair value | (1.2) | |
Recurring | Significant Other Observable Inputs (Level 2) | Cross Currency Swap | ||
Fair Value Measurements | ||
Assets at fair value | 15.1 | 8.1 |
Liabilities at fair value | (3.4) | |
Recurring | Designated as Hedging Instrument | Foreign Exchange Forward Contracts | ||
Fair Value Measurements | ||
Assets at fair value | 2.4 | 1.9 |
Recurring | Designated as Hedging Instrument | Significant Other Observable Inputs (Level 2) | Foreign Exchange Forward Contracts | ||
Fair Value Measurements | ||
Assets at fair value | 2.4 | 1.9 |
Recurring | Not Designated as Hedging Instruments - Economic | ||
Fair Value Measurements | ||
Liabilities at fair value | (7.1) | |
Recurring | Not Designated as Hedging Instruments - Economic | Foreign Exchange Forward Contracts | ||
Fair Value Measurements | ||
Assets at fair value | 0.1 | |
Liabilities at fair value | (1.6) | |
Recurring | Not Designated as Hedging Instruments - Economic | Significant Other Observable Inputs (Level 2) | ||
Fair Value Measurements | ||
Liabilities at fair value | $ (7.1) | |
Recurring | Not Designated as Hedging Instruments - Economic | Significant Other Observable Inputs (Level 2) | Foreign Exchange Forward Contracts | ||
Fair Value Measurements | ||
Assets at fair value | 0.1 | |
Liabilities at fair value | $ (1.6) |
Fair Value Measurements - Items
Fair Value Measurements - Items not at Fair Value (Details) - Significant Other Observable Inputs (Level 2) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Fair Value of Debt Instruments | ||
Total fair value of long term debt | $ 1,163.6 | $ 1,097.2 |
2025 Senior Notes | ||
Fair Value of Debt Instruments | ||
Total fair value of long term debt | 482.3 | 438.3 |
2024 Term Loan B | ||
Fair Value of Debt Instruments | ||
Total fair value of long term debt | $ 681.3 | $ 658.9 |
Provision for Income Taxes (Det
Provision for Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Provision for Income Taxes | ||||
Effective tax rate | 36.00% | 17.20% | 29.30% | 17.20% |
Provision for income taxes | $ 15.7 | $ 20.4 | $ 26.5 | $ 45.3 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2019USD ($)item | Jun. 30, 2019USD ($)item | Dec. 31, 2018USD ($) | |
Commitments and Contingencies Disclosure | |||
Rental expense for leases ASC842 | $ 4,600,000 | $ 9,100,000 | |
Accrued obligations for environmental remediation and restoration costs | $ 0 | $ 0 | $ 0 |
Environmental claims asserted | item | 0 | 0 |
Commitments and Contingencies -
Commitments and Contingencies - Purchase Commitments (Details) | 6 Months Ended |
Jun. 30, 2019 | |
Maximum | |
Loss Contingencies [Line Items] | |
Purchase commitment period | 3 years |
Minimum | |
Loss Contingencies [Line Items] | |
Purchase commitment period | 1 year |
Pension Plans and Other Postr_3
Pension Plans and Other Postretirement Benefits - Net Periodic Benefit Costs (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Net periodic benefit cost | ||||
Curtailment and settlement (gain) loss | $ 0.7 | |||
Defined Benefit Pension Plans | ||||
Net periodic benefit cost | ||||
Service cost | $ 3.1 | $ 3.1 | 6.3 | $ 6.2 |
Interest cost | 1.2 | 1.2 | 2.5 | 2.5 |
Expected return on plan assets | (0.5) | (0.5) | (1) | (1.1) |
Amortization of prior service cost (credit) | (0.3) | (0.3) | (0.5) | (0.6) |
Amortization of net (gain) loss | 0.8 | 0.9 | 1.5 | 1.9 |
Curtailment and settlement (gain) loss | 0.7 | |||
Net periodic benefit cost | 4.3 | 4.4 | $ 9.5 | $ 8.9 |
Interest cost, Statements of Operations location | us-gaap:OtherNonoperatingIncomeExpense | us-gaap:OtherNonoperatingIncomeExpense | ||
Expected return, Statements of Operations location | us-gaap:OtherNonoperatingIncomeExpense | us-gaap:OtherNonoperatingIncomeExpense | ||
Amortization of prior service credit, Statements of Operations location | us-gaap:OtherNonoperatingIncomeExpense | us-gaap:OtherNonoperatingIncomeExpense | ||
Amortization of gain (loss), Statements of Operations location | us-gaap:OtherNonoperatingIncomeExpense | us-gaap:OtherNonoperatingIncomeExpense | ||
Net settlement and curtailment loss, Statements of Operations location | us-gaap:OtherNonoperatingIncomeExpense | us-gaap:OtherNonoperatingIncomeExpense | ||
Amounts recognized in other comprehensive income (loss) | ||||
Net periodic benefit cost | 4.3 | 4.4 | $ 9.5 | $ 8.9 |
Other Postretirement Plans | ||||
Net periodic benefit cost | ||||
Service cost | 0.1 | 0.1 | ||
Interest cost | 0.1 | 0.1 | 0.1 | 0.1 |
Amortization of prior service cost (credit) | 0.1 | |||
Amortization of net (gain) loss | $ (0.1) | $ (0.2) | ||
Net periodic benefit cost | 0.1 | 0.3 | ||
Amounts recognized in other comprehensive income (loss) | ||||
Net periodic benefit cost | $ 0.1 | $ 0.3 |
Pension Plans and Other Postr_4
Pension Plans and Other Postretirement Benefits - Net Amounts Recognized (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | |
Net amounts recognized in the balance sheets at December 31 | |||
Noncurrent liabilities | $ (196.4) | $ (196.4) | $ (189.2) |
Cash contributions and benefit payments to unfunded plans | 2 | 2.9 | |
Expected contributions, remainder of current year | $ 3.3 | $ 3.3 |
Share-Based Compensation - Summ
Share-Based Compensation - Summary of Expense (Detail) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Share-based compensation expense | $ 3.5 | $ 3.4 | $ 7.7 | $ 8.9 |
Restricted Share Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Share-based compensation expense | 1.9 | 2.1 | 4 | 4.3 |
Unrecognized compensation cost | 13.9 | $ 13.9 | ||
Weighted-average period of recognition | 2 years 2 months 12 days | |||
Option Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Share-based compensation expense | 0.8 | 0.6 | $ 2 | 3.4 |
Unrecognized compensation cost, options | 2.8 | $ 2.8 | ||
Weighted-average period of recognition | 1 year 7 months 6 days | |||
Performance Share Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Share-based compensation expense | 0.8 | $ 0.7 | $ 1.7 | $ 1.2 |
Unrecognized compensation cost | $ 5.9 | $ 5.9 | ||
Weighted-average period of recognition | 2 years 3 months 18 days |
Share-Based Compensation - RSUs
Share-Based Compensation - RSUs (Details) - Restricted Share Units | 6 Months Ended |
Jun. 30, 2019$ / sharesshares | |
Other-than-Options, Shares Activity | |
Granted, Shares | shares | 236,156 |
Other-than-Options, FV Activity | |
Granted, Weighted-Average Grant Date Fair Value per Share | $ / shares | $ 48.63 |
Share-Based Compensation - Opti
Share-Based Compensation - Options and PSUs (Details) - USD ($) $ / shares in Units, $ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Options, Additional Disclosures | ||
Proceeds from exercise of option awards | $ 0.8 | $ 2.3 |
Option Awards | ||
Options Outstanding Roll Forward | ||
Granted, Options | 237,071 | |
Options, Additional Disclosures | ||
Unrecognized compensation cost, options | $ 2.8 | |
Fair Value Assumptions | ||
Expected term (in years) | 5 years 6 months | |
Expected volatility | 36.00% | |
Risk-free interest rate | 2.53% | |
Dividend yield | 2.00% | |
Options granted, Weighted average grant date fair value | $ 15.40 | |
Performance Share Units | ||
Fair Value Assumptions | ||
Expected term (in years) | 3 years | |
Expected volatility | 36.40% | |
Risk-free interest rate | 2.58% | |
Share Price | $ 50.95 | |
Other-than-Options, Shares Activity | ||
Granted, Shares | 117,053 | |
Other-than-Options, FV Activity | ||
Granted, Weighted-Average Grant Date Fair Value per Share | $ 54.01 |
Segments - Reconciliation of Se
Segments - Reconciliation of Segment Reporting to Consolidated (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)segment | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of operating segments | segment | 6 | ||||
Sales to external customers | $ 951.8 | $ 1,236.6 | $ 1,964.9 | $ 2,358.1 | |
Equity in earnings of unconsolidated affiliates | 40.3 | 33.2 | 72.5 | 78.8 | |
Adjusted EBITDA | 123.6 | 194.8 | 251.7 | 410 | |
Investment in unconsolidated affiliates | 199.1 | 199.1 | $ 179.1 | ||
Depreciation and amortization | $ 34.7 | 32.3 | 68.7 | 64.3 | |
Capital expenditures | $ 47.6 | 59.5 | |||
Americas Styrenics | |||||
Segment Reporting Information [Line Items] | |||||
Percentage of ownership underlying net assets | 50.00% | 50.00% | 50.00% | ||
Investment in unconsolidated affiliates | $ 199.1 | $ 199.1 | $ 179.1 | ||
Latex Binders Segment | |||||
Segment Reporting Information [Line Items] | |||||
Sales to external customers | 230.2 | 280.8 | 454.1 | 536.1 | |
Latex Binders Segment | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Adjusted EBITDA | 20.6 | 36 | 38.1 | 63.5 | |
Synthetic Rubber Segment | |||||
Segment Reporting Information [Line Items] | |||||
Sales to external customers | 112.1 | 155.3 | 236.7 | 304.5 | |
Synthetic Rubber Segment | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Adjusted EBITDA | 12.9 | 30.6 | 21.7 | 56.2 | |
Performance Plastics Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales to external customers | 347.5 | 412.8 | 716.8 | 815.6 | |
Performance Plastics Segment [Member] | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Adjusted EBITDA | 34.2 | 48.9 | 69.9 | 114.3 | |
Polystyrene [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales to external customers | 207.1 | 285.6 | 435.6 | 525.2 | |
Polystyrene [Member] | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Adjusted EBITDA | 16.2 | 13.7 | 32.9 | 23.3 | |
Feedstocks [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales to external customers | 54.9 | 102.1 | 121.7 | 176.7 | |
Feedstocks [Member] | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Adjusted EBITDA | (0.6) | 32.4 | 16.6 | 73.9 | |
Americas Styrenics [Member] | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Adjusted EBITDA | $ 40.3 | $ 33.2 | $ 72.5 | $ 78.8 |
Segments - Recon. of Net Income
Segments - Recon. of Net Income to Segment Adjusted EBITDA (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Segment Reporting Information [Line Items] | ||||
Income before income taxes | $ 43.7 | $ 118.7 | $ 90.3 | $ 263.9 |
Interest expense, net | (9.9) | (10.8) | (20.1) | (25.7) |
Depreciation and amortization | 34.7 | 32.3 | 68.7 | 64.3 |
Corporate Unallocated | 20.8 | 24.6 | 46.9 | 44.9 |
Adjusted EBITDA addbacks | 14.5 | 8.4 | 25.7 | 11.2 |
Adjusted EBITDA | 123.6 | 194.8 | 251.7 | 410 |
Loss on extinguishment of long-term debt | 0.2 | 0.2 | ||
Net (gain) loss on disposition of businesses and assets | (0.2) | (0.5) | ||
Restructuring and other charges | (0.3) | 1.2 | 0.1 | 1.7 |
Acquisition transactions and integration costs | 0.7 | 0.2 | 0.7 | 0.6 |
Other items | 14.1 | 6.8 | 25.1 | 9.2 |
Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Income before income taxes | 43.7 | 118.7 | 90.3 | 263.9 |
Corporate Unallocated [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Interest expense, net | $ (9.9) | $ (10.8) | $ (20.1) | $ (25.7) |
Restructuring (Details)
Restructuring (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Charges | $ (0.3) | $ 1.5 | $ 0.1 | $ 2.3 | |
Restructuring Reserve [Roll Forward] | |||||
Accrued charges/Balance at beginning of period | 6.7 | ||||
Expenses | 0.1 | ||||
Payments/Deductions | (5.3) | ||||
Accrued charges/Balance at end of period | 1.5 | 1.5 | $ 6.7 | ||
Terneuzen Plant Modernization | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Charges | (0.4) | 0.7 | (0.2) | 1.1 | |
Cumulative life-to-date charges | 5.6 | 5.6 | |||
Expected restructuring charges | 0.6 | 0.6 | |||
Livorno Plant Restructuring | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Charges | 0.1 | 0.5 | 0.3 | 0.8 | |
Cumulative life-to-date charges | 24.4 | 24.4 | |||
Land held for sale | 12 | 12 | 12 | ||
Deferred taxes on land held for sale | 2.9 | 2.9 | 2.9 | ||
Prepayment received on sale of property | 1.3 | 1.3 | |||
Other Restructurings | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Charges | 0.3 | 0.4 | |||
Asset Impairment And Accelerated Depreciation [Member] | Terneuzen Plant Modernization | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Charges | 0.3 | 0.6 | |||
Cumulative life-to-date charges | 3.1 | 3.1 | |||
Asset Impairment And Accelerated Depreciation [Member] | Livorno Plant Restructuring | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Charges | 0.4 | 0.4 | |||
Cumulative life-to-date charges | 14.7 | 14.7 | |||
Employee Termination Benefit Charges | |||||
Restructuring Reserve [Roll Forward] | |||||
Accrued charges/Balance at beginning of period | 6.4 | ||||
Expenses | (0.3) | ||||
Payments/Deductions | (4.9) | ||||
Accrued charges/Balance at end of period | 1.2 | 1.2 | 6.4 | ||
Employee Termination Benefit Charges | Terneuzen Plant Modernization | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Charges | (0.4) | 0.2 | (0.4) | 0.3 | |
Cumulative life-to-date charges | 0.6 | 0.6 | |||
Employee Termination Benefit Charges | Livorno Plant Restructuring | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Cumulative life-to-date charges | 5.4 | 5.4 | |||
Contract Termination | |||||
Restructuring Reserve [Roll Forward] | |||||
Accrued charges/Balance at beginning of period | 0.3 | ||||
Accrued charges/Balance at end of period | 0.3 | 0.3 | $ 0.3 | ||
Contract Termination | Terneuzen Plant Modernization | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Cumulative life-to-date charges | 0.3 | 0.3 | |||
Contract Termination | Livorno Plant Restructuring | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Cumulative life-to-date charges | 0.3 | 0.3 | |||
Decommissioning and Other Charges | |||||
Restructuring Reserve [Roll Forward] | |||||
Expenses | 0.4 | ||||
Payments/Deductions | (0.4) | ||||
Decommissioning and Other Charges | Terneuzen Plant Modernization | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Charges | 0.2 | 0.2 | 0.2 | ||
Cumulative life-to-date charges | 1.6 | 1.6 | |||
Decommissioning and Other Charges | Livorno Plant Restructuring | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring Charges | 0.1 | $ 0.1 | 0.3 | $ 0.4 | |
Cumulative life-to-date charges | $ 4 | $ 4 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Components (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Balance at beginning of period | $ 753.1 | $ 755.7 | $ 768.7 | $ 674.8 |
Balance at end of period | 745.1 | 801.8 | 745.1 | 801.8 |
Cumulative Translation Adjustments | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Balance at beginning of period | (112.1) | (96.6) | (111.8) | (94.5) |
Other comprehensive income (loss) | 3 | (16.1) | 2.7 | (18.2) |
Balance at end of period | (109.1) | (112.7) | (109.1) | (112.7) |
Pension and Other Postretirement Benefit Plans, Net | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Balance at beginning of period | (40.4) | (44.4) | (39.4) | (45) |
Other comprehensive income (loss) | (2) | |||
Amounts reclassified from AOCI to net income (loss) | 0.3 | 0.6 | 1.3 | 1.2 |
Balance at end of period | (40.1) | (43.8) | (40.1) | (43.8) |
Accumulated Gain Loss Net Cash Flow Hedge Parent | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Balance at beginning of period | 9 | (3.3) | 8.9 | (6.1) |
Other comprehensive income (loss) | (3.5) | 9.4 | (2.4) | 8.4 |
Amounts reclassified from AOCI to net income (loss) | (1.9) | 2.5 | (2.9) | 6.3 |
Balance at end of period | 3.6 | 8.6 | 3.6 | 8.6 |
Accumulated Other Comprehensive Income (Loss) | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Balance at beginning of period | (143.5) | (144.3) | (142.3) | (145.6) |
Other comprehensive income (loss) | (0.5) | (6.7) | (1.7) | (9.8) |
Amounts reclassified from AOCI to net income (loss) | (1.6) | 3.1 | (1.6) | 7.5 |
Balance at end of period | $ (145.6) | $ (147.9) | $ (145.6) | $ (147.9) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) - Reclassification (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Cost of sales | $ 865.6 | $ 1,073.9 | $ 1,781.2 | $ 2,020.2 | ||
Interest expense, net | 9.9 | 10.8 | 20.1 | 25.7 | ||
Curtailment and settlement (gain) loss | 0.7 | |||||
Income before income taxes | (43.7) | (118.7) | (90.3) | (263.9) | ||
Provision for (benefit from) income taxes | 15.7 | 20.4 | 26.5 | 45.3 | ||
Net income | (28) | $ (35.8) | (98.3) | $ (120.3) | (63.8) | (218.6) |
Pension and Other Postretirement Benefit Plans, Net | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Curtailment and settlement (gain) loss | 0.7 | |||||
Income before income taxes | 0.5 | 0.8 | 1.7 | 1.7 | ||
Provision for (benefit from) income taxes | (0.2) | (0.2) | (0.4) | (0.5) | ||
Net income | 0.3 | 0.6 | 1.3 | 1.2 | ||
Accumulated Defined Benefit Plans Adjustment, Net Prior Service Attributable to Parent [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Prior service credit | (0.3) | (0.2) | (0.6) | (0.5) | ||
Accumulated Defined Benefit Plans Adjustment, Net Gain (Loss) Attributable to Parent [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Net actuarial loss | 0.8 | 1 | 1.6 | 2.2 | ||
Accumulated Gain Loss Net Cash Flow Hedge Parent | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Cost of sales | (1.6) | 2.6 | (2.2) | 6.3 | ||
Interest expense, net | (0.3) | (0.1) | (0.7) | |||
Income before income taxes | (1.9) | 2.5 | (2.9) | 6.3 | ||
Net income | $ (1.9) | $ 2.5 | $ (2.9) | $ 6.3 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Earnings: | ||||||
Net income (loss) | $ 28 | $ 35.8 | $ 98.3 | $ 120.3 | $ 63.8 | $ 218.6 |
Shares: | ||||||
Weighted average ordinary shares outstanding | 40.8 | 43.1 | 41 | 43.3 | ||
Dilutive effect of RSUs and option awards | 0.3 | 0.7 | 0.5 | 0.9 | ||
Diluted weighted average ordinary shares outstanding | 41.1 | 43.8 | 41.5 | 44.2 | ||
Income (loss) per share: | ||||||
Income per share- basic | $ 0.69 | $ 2.28 | $ 1.56 | $ 5.05 | ||
Income per share- diluted | $ 0.68 | $ 2.24 | $ 1.54 | $ 4.95 | ||
Anti-dilutive shares excluded | 0.7 | 0.4 | 0.8 | 0.2 |
Leases (Details)
Leases (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Lessee Disclosure [Abstract] | |
Lease, Practical Expedients, Package [true false] | true |
Lease, Practical Expedient, Lessor Single Lease Component [true false] | true |
Lease, Practical Expedient, Land Easement [true false] | true |
Lease, Practical Expedient, Use of Hindsight [true false] | false |
Assets and Liabilities, Lessee [Abstract] | |
Operating Lease, Right-of-Use Asset | $ 70.8 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Operating Lease, Right-of-Use Asset |
Finance Lease, Right-of-Use Asset | $ 2 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, Plant and Equipment, Net |
Operating lease liabilities - current portion | $ (15.5) |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Operating lease liabilities - current portion |
Operating lease liabilities - noncurrent portion | $ (55.6) |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Operating lease liabilities - noncurrent portion |
Finance lease liabilities - current portion | $ (0.5) |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | us-gaap:DebtCurrent |
Finance lease liabilities - noncurrent portion | $ (1.5) |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Long-term Debt, Excluding Current Maturities |
Leases - Costs and SCF (Details
Leases - Costs and SCF (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | |
Lease, Cost [Abstract] | ||
Finance Lease, Right-of-Use Asset, Amortization | $ 0.1 | $ 0.1 |
Operating Lease, Expense | 4.6 | 9.1 |
Variable Lease, Cost | 0.1 | |
Total lease cost | 4.7 | 9.3 |
Operating Lease, Payments | 4.2 | 8 |
Finance Lease, Principal Payments | 0.1 | 0.1 |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | 5.7 | 78.2 |
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability | $ 1.4 | 2.1 |
Maximum | ||
Lease, Cost [Abstract] | ||
Variable Lease, Cost | 0.1 | |
Finance Lease, Interest Payment on Liability | 0.1 | |
Finance Lease, Principal Payments | $ 0.1 |
Leases - Maturities, etc. (Deta
Leases - Maturities, etc. (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
Remainder of 2019 | $ 9.3 | |
2020 | 14.8 | |
2021 | 9.8 | |
2022 | 8.3 | |
2023 | 7.9 | |
Thereafter | 36.7 | |
Total payments due | 86.8 | |
Less Imputed interest | (15.7) | |
Operating lease liability | 71.1 | |
Finance Lease, Liability, Payment, Due [Abstract] | ||
Remainder of 2019 | 0.3 | |
Finance Lease, Liability, Payments, Due Year Two | 0.6 | |
Finance Lease, Liability, Payments, Due Year Three | 0.6 | |
Finance Lease, Liability, Payments, Due Year Four | 0.3 | |
Finance Lease, Liability, Payments, Due Year Five | 0.1 | |
Thereafter | 0.4 | |
Total payments due | 2.3 | |
Less Imputed interest | (0.3) | |
Finance lease liability | $ 2 | |
Operating Lease, Weighted Average Remaining Lease Term | 9 years 1 month 6 days | |
Finance Lease, Weighted Average Remaining Lease Term | 6 years 9 months 18 days | |
Operating Lease, Weighted Average Discount Rate, Percent | 4.60% | |
Finance Lease, Weighted Average Discount Rate, Percent | 4.40% | |
Operating leases not yet commenced | $ 6 | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity, prior to adoption [Abstract] | ||
2019 | $ 17.5 | |
2020 | 14.4 | |
2021 | 9 | |
2022 | 10.6 | |
2023 | 5.4 | |
Thereafter | 16 | |
Total | $ 72.9 | |
Minimum | ||
Finance Lease, Liability, Payment, Due [Abstract] | ||
Lessee, Operating Lease, Lease Not yet Commenced, Term of Contract | 6 months | |
Maximum | ||
Finance Lease, Liability, Payment, Due [Abstract] | ||
Lessee, Operating Lease, Lease Not yet Commenced, Term of Contract | 16 years |