Segment Information

3 Months Ended

Mar. 31, 2016

Segment Reporting [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 March 31, 2016, 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, phenolic encapsulated substrates, 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 for certain non-cash items and other income and expenses. 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 ⁽¹⁾:

	Three Months Ended March 31,
	2016		2015
Epoxy, Phenolic and Coating Resins	$	575	$	674
Forest Products Resins	334		405
Total	$	909	$	1,079

(1)     Intersegment sales are not significant and, as such, are eliminated within the selling segment.

Segment EBITDA:

	Three Months Ended March 31,
	2016			2015
Epoxy, Phenolic and Coating Resins	$	83		$	85
Forest Products Resins	56			61
Corporate and Other	(17		)	(19		)
Total	$	122		$	127

Reconciliation of Segment EBITDA to Net Loss:

	Three Months Ended March 31,
	2016			2015
Segment EBITDA:
Epoxy, Phenolic and Coating Resins	$	83		$	85
Forest Products Resins	56			61
Corporate and Other	(17		)	(19		)
Total	$	122		$	127
Reconciliation:
Items not included in Segment EBITDA:
Business realignment costs	$	(3	)	$	(3	)
Gain on extinguishment of debt	23			—
Realized and unrealized foreign currency losses	(2		)	(3		)
Other	(17		)	(18		)
Total adjustments	1			(24		)
Interest expense, net	(79		)	(77		)
Income tax expense	(7		)	(26		)
Depreciation and amortization	(35		)	(34		)
Accelerated depreciation	(46		)	—
Net loss	$	(44	)	$	(34	)

Items Not Included in Segment EBITDA

Not included in Segment EBITDA are certain non-cash items and other income and expenses. For the three months ended March 31, 2016, these items primarily include expenses from retention programs and certain professional fees. For the three months ended March 31, 2015, these items primarily include expenses from retention programs, losses on the disposal of assets and certain professional fees. Business realignment costs for the three months ended March 31, 2016 and March 31, 2015, include costs for environmental remediation at certain formerly owned locations and expenses related to certain in-process cost reduction programs.