Note 12 - Discontinued Operations

6 Months Ended

Jun. 30, 2014

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

Note 12 - Discontinued Operations

On September 1, 2014, we closed on the sale of Tropical Shipping to an unrelated third party. The after-tax cash proceeds and distributions from the transaction were $225 million. We determined that the cumulative foreign earnings of Tropical Shipping would no longer be indefinitely reinvested offshore. Accordingly, we recognized income tax expense of $60 million, of which $31 million was recorded in the first quarter of 2014 and the remaining $29 million was recorded in the third quarter of 2014 related to the cumulative foreign earnings for which no tax liabilities had been previously recorded, resulting in our repatriation of $86 million in cash. As of June 30, 2014, we had $55 million of deferred income tax liabilities on our unaudited Condensed Consolidated Statements of Financial Position related to the cumulative earnings of our foreign subsidiaries that have not been repatriated.

During the first quarter of 2014, based upon the negotiated sales price, we also recorded a goodwill impairment charge of $19 million, for which there is no income tax benefit. Additionally, we recognized a $4 million charge in the second quarter of 2014 related to the suspension of depreciation and amortization for assets that we were not compensated for by the buyer. The assets and liabilities of Tropical Shipping classified as held for sale on the unaudited Condensed Consolidated Statements of Financial Position are as follows:

	June 30,		December 31,		June 30,
In millions	2014		2013		2013
Current assets
Cash and cash equivalents	$	15	$	24	$	31
Short-term investments		3		1		1
Receivables		35		36		34
Inventories		9		9		8
Other		2		1		1
Total current assets		64		71		75
Long-term assets and other deferred debits
Property, plant and equipment, net		127		124		125
Goodwill		42		61		61
Intangible assets		19		19		20
Other		5		8		8
Total long-term assets and other deferred debits		193		212		214
Total assets held for sale	$	257	$	283	$	289
Current liabilities
Other accounts payable - trade	$	9	$	11	$	8
Accrued expenses		7		7		6
Other		23		22		24
Total current liabilities		39		40		38
Total liabilities held for sale	$	39	$	40	$	38

The financial results of these businesses are reflected as discontinued operations, and all prior periods presented have been recast to reflect the discontinued operations. The components of discontinued operations recorded on the unaudited Condensed Consolidated Statements of Income are as follows:

	Three months ended June 30,					Six months ended June 30,
In millions	2014		2013			2014			2013
Operating revenues	$	92	$	88		$	181		$	175
Operating expenses
Cost of goods sold		57		54			111			107
Operation and maintenance		27		29			55			55
Depreciation and amortization (1)		-		6			5			10
Taxes other than income taxes		3		-			4			3
Loss on sale and goodwill impairment (2)		4		-			23			-
Total operating expenses		91		89			198			175
Operating income (loss)		1		(1	)		(17	)		-
Income (loss) before income taxes		1		(1	)		(17	)		-
Income tax expense (3)		-		-			(32	)		-
Income (loss) from discontinued operations, net of tax	$	1	$	(1	)	$	(49	)	$	-

(1) We ceased depreciating and amortizing Tropical Shipping’s assets on April 4, 2014 as a result of entering into an agreement to sell this business and the assets were classified as held for sale.

(2) Relates to the suspension of depreciation and amortization of $4 million and $19 million of goodwill attributable to Tropical Shipping that was impaired as of March 31, 2014 based on the negotiated sales price.

(3) Expense for the six months ended 2014 includes $31 million that was recorded in the first quarter of 2014 related to the cumulative foreign earnings for which no tax liabilities previously had been recorded.