Supplemental Guarantor Condensed Consolidating Financial Statements

9 Months Ended

Sep. 30, 2011

Supplemental Guarantor Condensed Consolidating Financial Statements [Abstract]

Supplemental Guarantor Condensed Consolidating Financial Statements

(15)   Supplemental Guarantor Condensed Consolidating Financial Statements

Basis of Presentation

Substantially all of our existing and future material domestic 100% owned subsidiaries (which are referred to as the Guarantor Subsidiaries) fully and unconditionally guarantee our senior notes due in 2015, 2018, and 2020 on a joint and several basis. The Guarantor Subsidiaries are combined in the presentation below.

These consolidating financial statements are presented on the equity method. Under this method, our investments are recorded at cost and adjusted for our ownership share of a subsidiary’s cumulative results of operations, capital contributions and distributions, and other equity changes. You should read the condensed consolidating financial information of the Guarantor Subsidiaries in connection with our condensed consolidated financial statements and related notes of which this note is an integral part.

Distributions

There are no significant restrictions on the ability of the Guarantor Subsidiaries to make distributions to us.

STATEMENT OF INCOME (LOSS)

	For the Three Months Ended September 30, 2011
							Tenneco Inc.
	Guarantor			Nonguarantor			(Parent			Reclass &
	Subsidiaries			Subsidiaries			Company)			Elims			Consolidated
							(Millions)
Revenues
Net sales and operating revenues —
External	$	761		$	1,012		$	—		$	—		$	1,773
Affiliated companies		40			126			—			(166	)		—
		801			1,138			—			(166	)		1,773
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)		568			1,090			—			(166	)		1,492
Goodwill impairment charge		—			11			—			—			11
Engineering, research, and development		14			18			—			—			32
Selling, general, and administrative		34			65			2			—			101
Depreciation and amortization of other intangibles		18			33			—			—			51
		634			1,217			2			(166	)		1,687
Other income (expense)
Loss on sale of receivables		—			(1	)		—			—			(1	)
Other income (expense)		(3	)		2			—			—			(1	)
		(3	)		1			—			—			(2	)
Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies		164			(78	)		(2	)		—			84
Interest expense —
External (net of interest capitalized)		—			2			25			—			27
Affiliated companies (net of interest income)		54			(18	)		(36	)		—			—
Income tax expense		3			18			—			—			21
Equity in net income (loss) from affiliated companies		(89	)		—			21			68			—
Net income (loss)		18			(80	)		30			68			36
Less: Net income attributable to noncontrolling interests		—			6			—			—			6
Net income (loss) attributable to Tenneco Inc.	$	18		$	(86	)	$	30		$	68		$	30

STATEMENT OF INCOME (LOSS)

	For the Three Months Ended September 30, 2010
						Tenneco Inc.
	Guarantor		Nonguarantor			(Parent			Reclass &
	Subsidiaries		Subsidiaries			Company)			Elims			Consolidated
						(Millions)
Revenues
Net sales and operating revenues —
External	$	699	$	843		$	—		$	—		$	1,542
Affiliated companies		33		125			—			(158	)		—
		732		968			—			(158	)		1,542
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)		655		783			—			(158	)		1,280
Engineering, research, and development		14		16			—			—			30
Selling, general, and administrative		42		66			1			—			109
Depreciation and amortization of other intangibles		23		32			—			—			55
		734		897			1			(158	)		1,474
Other income (expense)
Loss on sale of receivables		—		(1	)		—			—			(1	)
Other income (expense)		5		(4	)		—			(1	)		—
		5		(5	)		—			(1	)		(1	)
Earnings (loss) before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies		3		66			(1	)		(1	)		67
Interest expense —
External (net of interest capitalized)		—		2			34			—			36
Affiliated companies (net of interest income)		49		(17	)		(32	)		—			—
Income tax expense (benefit)		1		14			—			—			15
Equity in net income (loss) from affiliated companies		57		—			13			(70	)		—
Net income (loss)		10		67			10			(71	)		16
Less: Net income attributable to noncontrolling interests		—		6			—			—			6
Net income (loss) attributable to Tenneco Inc.	$	10	$	61		$	10		$	(71	)	$	10

STATEMENT OF INCOME (LOSS)

	For the Nine Months Ended September 30, 2011
						Tenneco Inc.
	Guarantor		Nonguarantor			(Parent			Reclass &
	Subsidiaries		Subsidiaries			Company)			Elims			Consolidated
	(Millions)
Revenues
Net sales and operating revenues —
External	$	2,331	$	3,090		$	—		$	—		$	5,421
Affiliated companies		121		383			—			(504	)		—
		2,452		3,473			—			(504	)		5,421
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)		2,013		3,014			—			(504	)		4,523
Goodwill impairment charge		—		11			—			—			11
Engineering, research, and development		42		60			—			—			102
Selling, general, and administrative		106		219			3			—			328
Depreciation and amortization of other intangibles		55		101			—			—			156
		2,216		3,405			3			(504	)		5,120
Other income (expense)
Loss on sale of receivables		—		(4	)		—			—			(4	)
Other income (expense)		29		—			—			(35	)		(6	)
		29		(4	)		—			(35	)		(10	)
Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies		265		64			(3	)		(35	)		291
Interest expense —
External (net of interest capitalized)		—		4			77			—			81
Affiliated companies (net of interest income)		156		(52	)		(104	)		—			—
Income tax expense		8		57			—			—			65
Equity in net income (loss) from affiliated companies		29		—			103			(132	)		—
Net income (loss)		130		55			127			(167	)		145
Less: Net income attributable to noncontrolling interests		—		18			—			—			18
Net income (loss) attributable to Tenneco Inc.	$	130	$	37		$	127		$	(167	)	$	127

STATEMENT OF INCOME (LOSS)

	For the Nine Months Ended September 30, 2010
							Tenneco Inc.
	Guarantor			Nonguarantor			(Parent			Reclass &
	Subsidiaries			Subsidiaries			Company)			Elims			Consolidated
	(Millions)
Revenues
Net sales and operating revenues —
External	$	1,919		$	2,441		$	—		$	—		$	4,360
Affiliated companies		95			360			—			(455	)		—
		2,014			2,801			—			(455	)		4,360
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)		1,707			2,323			—			(455	)		3,575
Engineering, research, and development		40			50			—			—			90
Selling, general, and administrative		115			189			3			—			307
Depreciation and amortization of other intangibles		66			97			—			—			163
		1,928			2,659			3			(455	)		4,135
Other income (expense)
Loss on sale of receivables		—			(3	)		—			—			(3	)
Other income (expense)		14			(2	)		1			(16	)		(3	)
		14			(5	)		1			(16	)		(6	)
Earnings (loss) before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies		100			137			(2	)		(16	)		219
Interest expense —
External (net of interest capitalized)		(1	)		6			95			—			100
Affiliated companies (net of interest income)		136			(40	)		(96	)		—			—
Income tax expense (benefit)		5			40			—			—			45
Equity in net income (loss) from affiliated companies		104			—			58			(162	)		—
Net income (loss)		64			131			57			(178	)		74
Less: Net income attributable to noncontrolling interests		—			17			—			—			17
Net income (loss) attributable to Tenneco Inc.	$	64		$	114		$	57		$	(178	)	$	57

BALANCE SHEET

	September 30, 2011
							Tenneco Inc.
	Guarantor			Nonguarantor			(Parent		Reclass
	Subsidiaries			Subsidiaries			Company)		& Elims			Consolidated
	(Millions)
ASSETS
Current assets:
Cash and cash equivalents	$	2		$	161		$	—	$	—		$	163
Receivables, net		616			1,358			25		(882	)		1,117
Inventories		251			370			—		—			621
Deferred income taxes		77			—			—		(35	)		42
Prepayments and other		29			131			—		—			160
Total current assets		975			2,020			25		(917	)		2,103
Other assets:
Investment in affiliated companies		412			—			770		(1,182	)		—
Notes and advances receivable from affiliates		4,144			1,010			5,986		(11,140	)		—
Long-term receivables, net		1			12			—		—			13
Goodwill		22			53			—		—			75
Intangibles, net		13			20			—		—			33
Deferred income taxes		32			22			33		—			87
Other		25			45			29		—			99
		4,649			1,162			6,818		(12,322	)		307
Plant, property, and equipment, at cost		1,013			2,123			—		—			3,136
Less — Accumulated depreciation and amortization		(735	)		(1,375	)		—		—			(2,110	)
		278			748			—		—			1,026
Total assets	$	5,902		$	3,930		$	6,843	$	(13,239	)	$	3,436
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	$	—		$	69		$	1	$	—		$	70
Short-term debt — affiliated		210			517			10		(737	)		—
Trade payables		483			813			—		(115	)		1,181
Accrued taxes		21			25			—		—			46
Other		126			213			51		(65	)		325
Total current liabilities		840			1,637			62		(917	)		1,622
Long-term debt — non-affiliated		—			11			1,223		—			1,234
Long-term debt — affiliated		4,678			1,024			5,438		(11,140	)		—
Deferred income taxes		—			50			—		—			50
Postretirement benefits and other liabilities		324			72			—		4			400
Commitments and contingencies
Total liabilities		5,842			2,794			6,723		(12,053	)		3,306
Redeemable noncontrolling interests		—			10			—		—			10
Tenneco Inc. Shareholders’ equity		60			1,089			120		(1,186	)		83
Noncontrolling interests		—			37			—		—			37
Total equity		60			1,126			120		(1,186	)		120
Total liabilities, redeemable noncontrolling interests and equity	$	5,902		$	3,930		$	6,843	$	(13,239	)	$	3,436

BALANCE SHEET

	December 31, 2010
							Tenneco Inc.
	Guarantor			Nonguarantor			(Parent		Reclass
	Subsidiaries			Subsidiaries			Company)		& Elims			Consolidated
							(Millions)
ASSETS
Current assets:
Cash and cash equivalents	$	—		$	233		$	—	$	—		$	233
Receivables, net		402			1,106			24		(706	)		826
Inventories		221			326			—		—			547
Deferred income taxes		103			—			—		(65	)		38
Prepayments and other		35			111			—		—			146
Total current assets		761			1,776			24		(771	)		1,790
Other assets:
Investment in affiliated companies		391			—			707		(1,098	)		—
Notes and advances receivable from affiliates		4,119			788			5,853		(10,760	)		—
Long-term receivables, net		1			8			—		—			9
Goodwill		22			67			—		—			89
Intangibles, net		14			18			—		—			32
Deferred income taxes		37			21			34		—			92
Other		26			46			33		—			105
		4,610			948			6,627		(11,858	)		327
Plant, property, and equipment, at cost		997			2,112			—		—			3,109
Less — Accumulated depreciation and amortization		(713	)		(1,346	)		—		—			(2,059	)
		284			766			—		—			1,050
Total assets	$	5,655		$	3,490		$	6,651	$	(12,629	)	$	3,167
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	$	—		$	62		$	1	$	—		$	63
Short-term debt — affiliated		214			371			10		(595	)		—
Trade payables		367			773			—		(92	)		1,048
Accrued taxes		20			31			—		—			51
Other		130			213			47		(84	)		306
Total current liabilities		731			1,450			58		(771	)		1,468
Long-term debt — non-affiliated		—			11			1,149		—			1,160
Long-term debt — affiliated		4,583			768			5,409		(10,760	)		—
Deferred income taxes		—			56			—		—			56
Postretirement benefits and other liabilities		347			85			—		4			436
Commitments and contingencies
Total liabilities		5,661			2,370			6,616		(11,527	)		3,120
Redeemable noncontrolling interests		—			12			—		—			12
Tenneco Inc. Shareholders’ equity		(6	)		1,069			35		(1,102	)		(4	)
Noncontrolling interests		—			39			—		—			39
Total equity		(6	)		1,108			35		(1,102	)		35
Total liabilities, redeemable noncontrolling interests and equity	$	5,655		$	3,490		$	6,651	$	(12,629	)	$	3,167

STATEMENT OF CASH FLOWS

	Three Months Ended September 30, 2011
							Tenneco Inc.
	Guarantor			Nonguarantor			(Parent			Reclass
	Subsidiaries			Subsidiaries			Company)			& Elims		Consolidated
	(Millions)
Operating Activities
Net cash provided (used) by operating activities	$	74		$	57		$	(51	)	$	—	$	80
Investing Activities
Cash payments for plant, property, and equipment		(14	)		(36	)		—			—		(50	)
Cash payments for software related intangible assets		(1	)		(3	)		—			—		(4	)
Net cash used by investing activities		(15	)		(39	)		—			—		(54	)
Financing Activities
Issuance of long-term debt		—			1			—			—		1
Increase (decrease) in bank overdrafts		—			(5	)		—			—		(5	)
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt		—			8			12			—		20
Intercompany dividends and net increase (decrease) in intercompany obligations		(57	)		13			44			—		—
Purchase of additional noncontrolling equity interest		—			(4	)		—			—		(4	)
Distributions to noncontrolling interest partners		—			(10	)		—			—		(10	)
Purchase of common stock under the share repurchase program		—			—			(5	)		—		(5	)
Net cash provided (used) by financing activities		(57	)		3			51			—		(3	)
Effect of foreign exchange rate changes on cash and cash equivalents		—			(21	)		—			—		(21	)
Increase (decrease) in cash and cash equivalents		2			—			—			—		2
Cash and cash equivalents, July 1		—			161			—			—		161
Cash and cash equivalents, September 30 (Note)	$	2		$	161		$	—		$	—	$	163

Note:  Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase.

STATEMENT OF CASH FLOWS

	Three Months Ended September 30, 2010
							Tenneco Inc.
	Guarantor			Nonguarantor			(Parent			Reclass
	Subsidiaries			Subsidiaries			Company)			& Elims		Consolidated
							(Millions)
Operating Activities
Net cash provided (used) by operating activities	$	(25	)	$	65		$	(23	)	$	—	$	17
Investing Activities
Proceeds from the sale of assets		1			1			—			—		2
Cash payments for plant, property, and equipment		(11	)		(22	)		—			—		(33	)
Cash payments for software related intangible assets		(2	)		(1	)		—			—		(3	)
Investments and other		—			(1	)		—			—		(1	)
Net cash used by investing activities		(12	)		(23	)		—			—		(35	)
Financing Activities
Issuance of long-term debt		—			—			225			—		225
Debt issuance cost on long-term debt		—			—			(5	)		—		(5	)
Retirement of long-term debt		—			(1	)		(245	)		—		(246	)
Increase (decrease) in bank overdrafts		—			10			—			—		10
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt		—			2			61			—		63
Intercompany dividends and net increase (decrease) in intercompany obligations		35			(22	)		(13	)		—		—
Distribution to noncontrolling interests partners		—			(3	)		—			—		(3	)
Net cash provided (used) by financing activities		35			(14	)		23			—		44
Effect of foreign exchange rate changes on cash and cash equivalents		—			12			—			—		12
Increase (decrease) in cash and cash equivalents		(2	)		40			—			—		38
Cash and cash equivalents, July 1		2			144			—			—		146
Cash and cash equivalents, September 30 (Note)	$	—		$	184		$	—		$	—	$	184

Note:  Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase.

STATEMENT OF CASH FLOWS

	Nine Months Ended September 30, 2011
							Tenneco Inc.
	Guarantor			Nonguarantor			(Parent			Reclass
	Subsidiaries			Subsidiaries			Company)			& Elims		Consolidated
							(Millions)
Operating Activities
Net cash provided (used) by operating activities	$	226		$	(13	)	$	(169	)	$	—	$	44
Investing Activities
Proceeds from sale of assets		3			1			—			—		4
Cash payments for plant, property, and equipment		(44	)		(101	)		—			—		(145	)
Cash payments for software related intangible assets		(3	)		(7	)		—			—		(10	)
Net cash used by investing activities		(44	)		(107	)		—			—		(151	)
Financing Activities
Issuance of long-term debt		—			5			—			—		5
Debt issuance cost of long-term debt		—			—			(1	)		—		(1	)
Retirement of long-term debt		—			(1	)		(22	)		—		(23	)
Increase (decrease) in bank overdrafts		—			3			—			—		3
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt		—			11			97			—		108
Intercompany dividends and net increase (decrease) in intercompany obligations		(180	)		69			111			—		—
Capital contribution from noncontrolling interest partner		—			1			—			—		1
Purchase of additional noncontrolling equity interest		—			(4	)		—			—		(4	)
Distribution to noncontrolling interest partners		—			(20	)		—			—		(20	)
Purchase of common stock under the share repurchase program		—			—			(16	)		—		(16	)
Net cash provided (used) by financing activities		(180	)		64			169			—		53
Effect of foreign exchange rate changes on cash and cash equivalents		—			(16	)		—			—		(16	)
Increase (decrease) in cash and cash equivalents		2			(72	)		—			—		(70	)
Cash and cash equivalents, January 1		—			233			—			—		233
Cash and cash equivalents, September 30 (Note)	$	2		$	161		$	—		$	—	$	163

Note:  Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase.

STATEMENT OF CASH FLOWS

	Nine Months Ended September 30, 2010
							Tenneco Inc.
	Guarantor			Nonguarantor			(Parent			Reclass
	Subsidiaries			Subsidiaries			Company)			& Elims		Consolidated
	(Millions)
Operating Activities
Net cash provided (used) by operating activities	$	(88	)	$	292		$	(140	)	$	—	$	64
Investing Activities
Proceeds from sale of assets		1			2			—			—		3
Cash payments for plant, property, and equipment		(40	)		(65	)		—			—		(105	)
Cash payments for software related intangible assets		(7	)		(4	)		—			—		(11	)
Investments and other		—			1			—			—		1
Net cash used by investing activities		(46	)		(66	)		—			—		(112	)
Financing Activities
Issuance of long-term debt		—			5			375			—		380
Debt issuance cost on long-term debt		—			—			(14	)		—		(14	)
Retirement of long-term debt		—			(3	)		(380	)		—		(383	)
Increase (decrease) in bank overdrafts		—			12			—			—		12
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt		—			(3	)		86			—		83
Intercompany dividends and net increase (decrease) in intercompany obligations		114			(187	)		73			—		—
Distribution to noncontrolling interests partners		—			(14	)		—			—		(14	)
Net cash provided (used) by financing activities		114			(190	)		140			—		64
Effect of foreign exchange rate changes on cash and cash equivalents		—			1			—			—		1
Increase (decrease) in cash and cash equivalents		(20	)		37			—			—		17
Cash and cash equivalents, January 1		20			147			—			—		167
Cash and cash equivalents, September 30 (Note)	$	—		$	184		$	—		$	—	$	184

Note:  Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase.