Segment Information

9 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Segment Information

15. Segment Information

Adient manages its business on a geographic basis and operates in the following three reportable segments for financial reporting purposes: 1) Americas, which is inclusive of North America and South America; 2) Europe, Middle East, and Africa ("EMEA") and 3) Asia Pacific/China ("Asia").

Adient evaluates the performance of its reportable segments using an adjusted EBITDA metric defined as income before income taxes and noncontrolling interests, excluding net financing charges, restructuring and impairment costs, restructuring related-costs, net mark-to-market adjustments on pension and postretirement plans, transaction gains/losses, purchase accounting amortization, depreciation, stock-based compensation and other non-recurring items ("Adjusted EBITDA"). Also, certain corporate-related costs are not allocated to the segments. The reportable segments are consistent with how management views the markets served by Adient and reflect the financial information that is reviewed by its chief operating decision maker.

	Three Months Ended June 30,				Nine Months Ended June 30,
(in millions)	2021		2020		2021		2020
Net Sales
Americas	$	1,440	$	593	$	4,821	$	4,093
EMEA	1,328		698		4,568		3,750
Asia	516		346		1,658		1,362
Eliminations	(42)		(11)		(138)		(132)
Total net sales	$	3,242	$	1,626	$	10,909	$	9,073

	Three Months Ended June 30,				Nine Months Ended June 30,
(in millions)	2021		2020		2021		2020
Adjusted EBITDA
Americas	$	23	$	(83)	$	219	$	117
EMEA	22		(94)		277		17
Asia	92		71		364		311
Corporate-related costs (1)	(19)		(16)		(61)		(59)
Restructuring and impairment costs (2)	(8)		(49)		(20)		(103)
Purchase accounting amortization (3)	(11)		(9)		(32)		(30)
Restructuring related charges (4)	—		(5)		(6)		(17)
Loss on business divestitures - net (5)	—		—		—		(25)
Gain on sale / (impairment) of nonconsolidated partially-owned affiliates (6)	—		(6)		33		(222)
Depreciation	(71)		(67)		(210)		(214)
Stock based compensation	(10)		(7)		(36)		(8)
Other items (7)	26		(4)		28		(12)
Earnings (loss) before interest and income taxes	44		(269)		556		(245)
Net financing charges	(87)		(58)		(256)		(156)
Other pension income (expense)	4		1		8		5
Income (loss) before income taxes	$	(39)	$	(326)	$	308	$	(396)

Notes:

(1) Corporate-related costs not allocated to the segments include executive office, communications, corporate development, legal and corporate finance.

(2) Reflects qualified restructuring charges for costs that are directly attributable to restructuring activities and meet the definition of restructuring under ASC 420 and non-recurring impairment charges. During the three and nine months ended June 30, 2021, a held-for-sale impairment charge of $1 million and $9 million, respectively, was recorded in EMEA. Restructuring charges during the three and nine months ended June 30, 2020 primarily consist of workforce reductions and a $27 million pre-tax non-cash impairment charge related to long-lived assets in China.

(3) Reflects amortization of intangible assets including those related to partially owned affiliates recorded within equity income.

(4) Reflects restructuring related charges for costs that are directly attributable to restructuring activities, but do not meet the definition of restructuring under ASC 420.

(5) The nine months ended June 30, 2020 reflects losses on business divestitures, of which $4 million is related to the deconsolidation of Adient Aerospace, and $21 million is the result of the sale of the RECARO automotive high performance seating systems.

(6) The nine months ended June 30, 2021 reflects a pre-tax gain of $33 million on the sale of Adient's interest in SJA. The three and nine months ended June 30, 2020 reflects the non-cash impairment of Adient's YFAI investment. Refer to Note 3, "Acquisitions and Divestitures," of the notes to consolidated financial statements.

(7) The three months ended June 30, 2021 reflects $2 million of transaction costs and a one-time gain of $30 million associated with retrospective recoveries of Brazil indirect tax credits resulting from a favorable court ruling (of which $28 million relates to recoveries covering the past 20 years and is adjusted out of Americas' segment results). The nine months ended June 30, 2021 reflects a one-time gain of $38 million associated with the retrospective recovery of indirect tax credits in Brazil resulting from a favorable court ruling (of which $36 million relates to recoveries covering the past 20 years and is adjusted out of Americas' segment results), a $5 million gain on previously held interest at YFAS in an affiliate, and $13 million of transaction costs. The three months ended June 30, 2020 reflects $4 million of transaction costs. The nine months ended June 30, 2020 reflects $11 million of transaction costs and $1 million of tax adjustments at YFAI.

Geographic Information

Revenue by geographic area is as follows:

Net Sales
	Three Months Ended June 30,				Nine Months Ended June 30,
(in millions)	2021		2020		2021		2020
Americas
United States	$	1,298	$	519	$	4,332	$	3,469
Mexico	558		192		1,783		1,379
Other Americas	64		17		238		236
Regional elimination	(480)		(135)		(1,532)		(991)
	1,440		593		4,821		4,093
EMEA
Germany	261		150		891		765
Czech Republic	276		166		964		806
Other EMEA	1,144		571		3,918		3,217
Regional elimination	(353)		(189)		(1,205)		(1,038)
	1,328		698		4,568		3,750
Asia
Thailand	113		44		357		307
China	171		130		525		372
Japan	60		34		253		262
Other Asia	177		140		539		425
Regional elimination	(5)		(2)		(16)		(4)
	516		346		1,658		1,362
Inter-segment elimination	(42)		(11)		(138)		(132)
Total	$	3,242	$	1,626	$	10,909	$	9,073