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Segment Information
 6 Months Ended
Jun. 30, 2012
Segment Information [Abstract]  
Segment Reporting Disclosure [Text Block]
Segment Information
The Company's business segments are based on the products that the Company offers and the markets that it serves. At June 30, 2012, the Company had two reportable segments: Epoxy, Phenolic and Coating Resins and Forest Products Resins. A summary of the major products of the Company's reportable segments follows:
 
•
Epoxy, Phenolic and Coating Resins: epoxy specialty resins, oil field products, versatic acids and derivatives, basic epoxy resins and intermediates, phenolic specialty resins and molding compounds, polyester resins, acrylic resins and vinylic resins
 
•
Forest Products Resins: forest products resins and formaldehyde applications

Reportable Segments
Following are net sales and Segment EBITDA (earnings before interest, income taxes, depreciation and amortization) by reportable segment. Segment EBITDA is defined as EBITDA adjusted to exclude certain non-cash, other income and expenses and discontinued operations. Segment EBITDA is the primary performance measure used by the Company's senior management, the chief operating decision-maker and the board of directors to evaluate operating results and allocate capital resources among segments. Segment EBITDA is also the profitability measure used to set management and executive incentive compensation goals. Corporate and Other is primarily corporate general and administrative expenses that are not allocated to the segments, such as shared service and administrative functions, foreign exchange gains and losses and legacy company costs not allocated to continuing segments.
Net Sales to Unaffiliated Customers(1):
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2012
 
2011
 
2012
 
2011
Epoxy, Phenolic and Coating Resins
$
796

 
$
972

 
$
1,590

 
$
1,818

Forest Products Resins
463

 
466

 
905

 
914

Total
$
1,259

 
$
1,438

 
$
2,495

 
$
2,732

(1)
Intersegment sales are not significant and, as such, are eliminated within the selling segment.
Segment EBITDA:
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2012
 
2011
 
2012
 
2011
Epoxy, Phenolic and Coating Resins
$
101

 
$
157

 
$
215

 
$
307

Forest Products Resins
56

 
50

 
102

 
95

Corporate and Other(2)
(12
)
 
(18
)
 
(26
)
 
(35
)
(2)
For the six months ended June 30, 2012, the Company has reclassified approximately $3 of costs into Corporate and Other Segment EBITDA which relate to the three months ended March 31, 2012.
Reconciliation of Segment EBITDA to Net Income:
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2012
 
2011
 
2012
 
2011
Segment EBITDA:
 
 
 
 
 
 
 
Epoxy, Phenolic and Coating Resins
$
101

 
$
157

 
$
215

 
$
307

Forest Products Resins
56

 
50

 
102

 
95

Corporate and Other
(12
)
 
(18
)
 
(26
)
 
(35
)
 
 
 
 
 
 
 
 
Reconciliation:
 
 
 
 
 
 
 
Items not included in Segment EBITDA:
 
 
 
 
 
 
 
Asset impairments and other non-cash charges
—

 
(21
)
 
(48
)
 
(21
)
Business realignment costs
(3
)
 
(5
)
 
(18
)
 
(8
)
Integration costs
(1
)
 
(5
)
 
(6
)
 
(10
)
Net (loss) income from discontinued operations
—

 
(3
)
 
—

 
2

Other
(3
)
 
16

 
4

 
12

Total adjustments
(7
)
 
(18
)
 
(68
)
 
(25
)
Interest expense, net
(67
)
 
(65
)
 
(132
)
 
(129
)
Income tax expense
(4
)
 
—

 
(2
)
 
(3
)
Depreciation and amortization
(39
)
 
(43
)
 
(77
)
 
(84
)
Net income
$
28

 
$
63

 
$
12

 
$
126


 Items Not Included in Segment EBITDA
Asset impairments and non-cash charges primarily represent asset impairments, stock-based compensation expense, accelerated depreciation on closing facilities and unrealized derivative and foreign exchange gains and losses. Business realignment costs for the three and six months ended June 30, 2012 primarily include expenses from the Company's restructuring and cost optimization programs. Business realignment costs for the three and six months ended June 30, 2011 primarily relate to expenses from minor restructuring programs. Integration costs relate primarily to the Momentive Combination. Net income from discontinued operations represents the results of the IAR and CCR businesses.
Not included in Segment EBITDA are certain non-cash and other income and expenses. For the three and six months ended June 30, 2012, these items primarily include net realized foreign exchange transaction gains and insurance recoveries related to the terminated Huntsman merger, partially offset by losses on the disposal of assets. For the three and six months ended June 30, 2011, these items include primarily business optimization expenses and retention program costs, offset by realized foreign exchange transaction gains and a gain recognized on the termination of an operator agreement with a customer.