Segment Information

3 Months Ended

Mar. 31, 2016

Segment Reporting [Abstract]

Segment Information

NOTE 17. Segment Information

Financial results for the Company's reportable segments have been prepared using a management approach, which is consistent with the basis and manner in which financial information is evaluated by the Company's chief operating decision-making group in allocating resources and in assessing performance. The Company’s chief operating decision making group, comprised of the Chief Executive Officer and Chief Financial Officer, evaluates the performance of the Company’s segments primarily based on net sales, before elimination of inter-company shipments, Adjusted EBITDA (non-GAAP financial measure) and operating assets.

The Company’s current reportable segments are as follows:

• Electronics - The Company's Electronics segment provides vehicle cockpit electronics products to customers, including audio systems, information displays, instrument clusters, head up displays, infotainment systems, and telematics solutions.

• Other - Other includes entities in South America and South Africa previously associated with the Climate business but not subject to the Climate Transaction. During 2015, other also included the Berlin, Germany operations previously associated with the Interiors business and sold during the fourth quarter of 2015.

Segment Sales

	Three Months Ended March 31
	2016		2015
	(Dollars in Millions)
Electronics	$	793	$	781
Other	9		44
Eliminations	—		(9		)
Total consolidated sales	$	802	$	816

Segment Adjusted EBITDA

The Company defines Adjusted EBITDA as net income attributable to the Company adjusted to eliminate the impact of depreciation and amortization, restructuring expense, net interest expense, loss on debt extinguishment, equity in net income of non-consolidated affiliates, loss on divestiture, gain on non-consolidated affiliate transactions, other net expense, provision for income taxes, discontinued operations, net income attributable to non-controlling interests, non-cash stock-based compensation expense, pension settlement gains and other non-operating gains and losses.

Adjusted EBITDA is presented as a supplemental measure of the Company's financial performance that management believes is useful to investors because the excluded items may vary significantly in timing or amounts and/or may obscure trends useful in evaluating and comparing the Company's operating activities across reporting periods. Not all companies use identical calculations

and, accordingly, the Company's presentation of Adjusted EBITDA may not be comparable to other similarly titled measures of

other companies.

Adjusted EBITDA is not a recognized term under accounting principles generally accepted in the United States and does not purport to be a substitute for net income as an indicator of operating performance or cash flows from operating activities as a measure of liquidity. Adjusted EBITDA has limitations as an analytical tool and is not intended to be a measure of cash flow available for management's discretionary use, as it does not consider certain cash requirements such as interest payments, tax payments and debt service requirements. In addition, the Company uses Adjusted EBITDA (i) as a factor in incentive compensation decisions, (ii) to evaluate the effectiveness of the Company's business strategies and (iii) because the Company's credit agreements use measures similar to Adjusted EBITDA to measure compliance with certain covenants. Adjusted EBITDA, as determined and measured by the Company should not be compared to similarly titled measures reported by other companies.

Segment Adjusted EBITDA is summarized below:

	Three Months Ended March 31
	2016			2015
	(Dollars in Millions)
Electronics	$	94		$	84
Other	(5		)	(6		)
Adjusted EBITDA	$	89		$	78

During the first quarter of 2016, the Company changed its corporate cost allocation methodology for management reporting purposes. Accordingly, costs associated with the Company's corporate headquarters and other administrative support functions have been included with the Electronics operating segment, representing ongoing business costs.

The reconciliation of Adjusted EBITDA to net income attributable to Visteon is as follows:

	Three Months Ended March 31
	2016		2015
	(Dollars in Millions)
Adjusted EBITDA	$	89	$	78
Depreciation and amortization	21		21
Restructuring expense	10		3
Interest expense, net	2		5
Equity in net loss of non-consolidated affiliates	—		1
Other expense, net	4		12
Provision for income taxes	13		9
Loss (income) from discontinued operations, net of tax	13		(46		)
Net income attributable to non-controlling interests	4		20
Non-cash, stock-based compensation expense	2		3
Other	1		—
Net income attributable to Visteon Corporation	$	19	$	50

Segment Total Assets:    

	Total Assets
	March 31		December 31
	2016		2015
	(Dollars in Millions)
Electronics	$	2,332	$	4,649
Other	36		32
Total consolidated assets	$	2,368	$	4,681