Segment Information

12 Months Ended

Dec. 31, 2016

Segment Information [Abstract]

Segment Reporting Disclosure [Text Block]

Segment and Geographic Information

The Company’s business segments are based on the products that the Company offers and the markets that it serves. At December 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⁾:

	Year Ended December 31,
	2016		2015		2014
Epoxy, Phenolic and Coating Resins	$	2,094	$	2,589	$	3,277
Forest Products Resins	1,344		1,551		1,860
Total	$	3,438	$	4,140	$	5,137

Segment EBITDA:

	Year Ended December 31,
	2016			2015			2014
Epoxy, Phenolic and Coating Resins(2)	$	258		$	307		$	290
Forest Products Resins(3)	240			233			255
Corporate and Other	(65		)	(74		)	(83		)
Total	$	433		$	466		$	462

Depreciation and Amortization Expense:

	Year Ended December 31,
	2016		2015		2014
Epoxy, Phenolic and Coating Resins	$	87	$	96	$	101
Forest Products Resins	40		35		36
Corporate and Other	4		6		7
Total	$	131	$	137	$	144

Total Assets:

	As of December 31,
	2016		2015
Epoxy, Phenolic and Coating Resins	$	1,002	$	1,320
Forest Products Resins	840		807
Corporate and Other	213		255
Total	$	2,055	$	2,382

Capital Expenditures⁽⁴⁾:

	Year Ended December 31,
	2016		2015		2014
Epoxy, Phenolic and Coating Resins	$	72	$	71	$	94
Forest Products Resins	67		106		85
Corporate and Other	2		2		4
Total	$	141	$	179	$	183

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

(2) Included in the Epoxy, Phenolic and Coating Resins Segment EBITDA are “Earnings from unconsolidated entities, net of taxes” of $11, $17 and $19 for the years ended December 31, 2016, 2015 and 2014, respectively.

(3) Included in the Forest Products Resins Segment EBITDA are “(Losses) earnings from unconsolidated entities, net of taxes” of less than $(1), less than $(1) and $1 for the years ended December 31, 2016, 2015 and 2014, respectively.

(4) Includes capitalized interest costs that are incurred during the construction of property and equipment.

Reconciliation of Net Loss to Segment EBITDA:

	Year Ended December 31,
	2016			2015			2014
Net loss	$	(38	)	$	(39	)	$	(224	)
Income tax expense	38			34			22
Interest expense, net	310			326			308
Depreciation and amortization	131			137			144
Accelerated depreciation	129			2			—
EBITDA	$	570		$	460		$	250
Items not included in Segment EBITDA:
Asset impairments	$	—		$	6		$	5
Business realignment costs	55			16			47
Realized and unrealized foreign currency (gains) losses	(11		)	10			32
Gain on dispositions	(240		)	—			—
Gain on extinguishment of debt	(48		)	(41		)	—
Unrealized losses (gains) on pension and OPEB plan liabilities	34			(13		)	102
Other	73			28			26
Total adjustments	(137		)	6			212
Segment EBITDA	$	433		$	466		$	462
Segment EBITDA:
Epoxy, Phenolic and Coating Resins	$	258		$	307		$	290
Forest Products Resins	240			233			255
Corporate and Other	(65		)	(74		)	(83		)
Total	$	433		$	466		$	462

Items Not Included in Segment EBITDA

Not included in Segment EBITDA are certain non-cash items and other income and expenses. For 2016, these other items primarily included certain professional fees related to strategic projects and expenses from retention programs. For 2015, these other items primarily included expenses from retention programs, certain professional fees related to strategic projects and management fees, partially offset by gains on the disposal of assets and a gain on a step acquisition. For 2014, these items primarily included expenses from retention programs, partially offset by gains on the disposal of assets.

Business realignment costs for 2016 primarily included costs related to the rationalization at our Norco, LA manufacturing facility and costs related to certain in-process cost reduction programs. Business realignment costs for 2015 primarily included costs related to certain in-process cost reduction programs. Business realignment costs for 2014 primarily included expenses from the Company’s newly implemented restructuring and cost optimization programs, as well as costs for environmental remediation at certain formerly owned locations.

Geographic Information

Net Sales⁽¹⁾:

	Year Ended December 31,
	2016		2015		2014
United States	$	1,389	$	1,663	$	2,189
Netherlands	583		698		856
Canada	302		344		429
China	296		331		245
Germany	180		205		282
Brazil	162		224		258
Other international	526		675		878
Total	$	3,438	$	4,140	$	5,137

(1) Sales are attributed to the country in which the individual business locations reside.

Long-Lived Assets:

	As of December 31,
	2016		2015
United States	$	555	$	673
Netherlands	99		130
Germany	92		88
Brazil	80		64
Canada	58		52
Other international	182		231
Total	$	1,066	$	1,238