
8.	EQUITY

Reconciliation of Balances

The following is a reconciliation of the beginning and ending balances of equity attributable to our stockholders, equity attributable to the noncontrolling interests, and total equity (in millions):



	Six Months Ended June 30,
	2014									2013
	Valero Stockholders’ Equity			Non- controlling Interests			Total Equity			Valero Stockholders’ Equity			Non- controlling Interests			Total Equity
Balance as of beginning of period	$	19,460		$	486		$	19,946		$	18,032		$	63		$	18,095
Net income (loss)	1,416			13			1,429			1,120			(3		)	1,117
Dividends	(266		)	—			(266		)	(220		)	—			(220		)
Stock-based compensation expense	21			—			21			25			—			25
Tax deduction in excess of stock-based compensation expense	31			—			31			27			—			27
Transactions in connection with stock-based compensation plans:
Stock issuances	32			—			32			43			—			43
Stock repurchases	(76		)	—			(76		)	(196		)	—			(196		)
Stock repurchases under buyback program	(483		)	—			(483		)	(364		)	—			(364		)
Separation of retail business	—			—			—			(499		)	—			(499		)
Contributions from noncontrolling interests	—			14			14			—			45			45
Distributions to public unitholders of Valero Energy Partners LP	—			(4		)	(4		)	—			—			—
Other comprehensive income (loss)	76			—			76			(48		)	—			(48		)
Balance as of end of period	$	20,211		$	509		$	20,720		$	17,920		$	105		$	18,025

The noncontrolling interests relate to third-party ownership interests in VLP and joint venture companies whose financial statements we consolidate due to our controlling interests.

Share Activity

Activity in the number of shares of common stock and treasury stock was as follows (in millions):



	Six Months Ended June 30,
	2014			2013
	Common Stock	Treasury Stock		Common Stock	Treasury Stock
Balance as of beginning of period	673	(138	)	673	(121	)
Transactions in connection with stock-based compensation plans:
Stock issuances	—	2		—	3
Stock repurchases	—	(1	)	—	(5	)
Stock repurchases under buyback program	—	(7	)	—	(8	)
Balance as of end of period	673	(144	)	673	(131	)

Common Stock Dividends

On July 29, 2014, our board of directors declared a quarterly cash dividend of $0.275 per common share payable on September 17, 2014 to holders of record at the close of business on August 20, 2014.

Income Tax Effects related to Components of Other Comprehensive Income

The tax effects allocated to each component of other comprehensive income (loss) were as follows (in millions):



	Three Months Ended June 30,
	2014									2013
	Before-Tax Amount			Tax Expense (Benefit)			Net Amount			Before-Tax Amount			Tax Expense (Benefit)			Net Amount
Foreign currency translation adjustment	$	150		$	—		$	150		$	(64	)	$	—		$	(64	)
Pension and other postretirement benefits:
Amounts reclassified into income related to:
Net actuarial loss	9			3			6			15			5			10
Prior service credit	(9		)	(5		)	(4		)	(9		)	(4		)	(5		)
Net gain on pension and other postretirement benefits	—			(2		)	2			6			1			5
Derivative instruments designated and qualifying as cash flow hedges:
Net loss arising during the period	(3		)	—			(3		)	(10		)	(3		)	(7		)
Net loss reclassified into income	—			—			—			8			3			5
Net loss on cash flow hedges	(3		)	—			(3		)	(2		)	—			(2		)
Other comprehensive income (loss)	$	147		$	(2	)	$	149		$	(60	)	$	1		$	(61	)



	Six Months Ended June 30,
	2014									2013
	Before-Tax Amount			Tax Expense (Benefit)			Net Amount			Before-Tax Amount			Tax Expense (Benefit)			Net Amount
Foreign currency translation adjustment	$	76		$	—		$	76		$	(268	)	$	—		$	(268	)
Pension and other postretirement benefits:
Gain arising during the period related to plan amendments	—			—			—			328			115			213
Amounts reclassified into income related to:
Net actuarial loss	17			6			11			29			10			19
Prior service credit	(19		)	(8		)	(11		)	(15		)	(6		)	(9		)
Net gain (loss) on pension and other postretirement benefits	(2		)	(2		)	—			342			119			223
Derivative instruments designated and qualifying as cash flow hedges:
Net gain (loss) arising during the period	4			2			2			(9		)	(3		)	(6		)
Net (gain) loss reclassified into income	(3		)	(1		)	(2		)	5			2			3
Net gain (loss) on cash flow hedges	1			1			—			(4		)	(1		)	(3		)
Other comprehensive income (loss)	$	75		$	(1	)	$	76		$	70		$	118		$	(48	)

Accumulated Other Comprehensive Income

Changes in accumulated other comprehensive income by component, net of tax, were as follows (in millions):



	Foreign Currency Translation Adjustment		Defined Benefit Plans Items			Gains and (Losses) on Cash Flow Hedges			Total
Balance as of December 31, 2013	$	408	$	(58	)	$	—		$	350
Other comprehensive income before reclassifications	76		—			2			78
Amounts reclassified from accumulated other comprehensive income (loss)	—		—			(2		)	(2		)
Net other comprehensive income	76		—			—			76
Balance as of June 30, 2014	$	484	$	(58	)	$	—		$	426



	Foreign Currency Translation Adjustment			Defined Benefit Plans Items			Gains and (Losses) on Cash Flow Hedges			Total
Balance as of December 31, 2012	$	665		$	(558	)	$	1		$	108
Other comprehensive income (loss) before reclassifications	(268		)	213			(6		)	(61		)
Amounts reclassified from accumulated other comprehensive income (loss)	—			10			3			13
Net other comprehensive income (loss)	(268		)	223			(3		)	(48		)
Separation of retail business	(159		)	—			—			(159		)
Balance as of June 30, 2013	$	238		$	(335	)	$	(2	)	$	(99	)