Restructuring Activities

12 Months Ended

Sep. 30, 2019

Restructuring and Related Activities [Abstract]

RESTRUCTURING ACTIVITIES

In the second fiscal quarter of 2019, Valvoline outlined a broad-based restructuring and cost-savings program that is expected to reduce costs, simplify processes and focus the organization’s structure and resources on key growth initiatives. Part of this program includes employee separation actions, which were generally completed during fiscal 2019, with the associated termination benefits anticipated to be substantially paid by the end of 2020.

During the year ended September 30, 2019, Valvoline recognized $12 million of expense for employee termination benefits, which includes severance and other benefits provided to employees pursuant to the restructuring program. These expenses were recognized in Selling, general and administrative expenses within the Consolidated Statements of Comprehensive Income. The Company expects that it will incur additional employee termination expenses of approximately $1 million during the first fiscal quarter of 2020.

The results by segment, as disclosed in Note 21, do not include these restructuring expenses, which is consistent with the manner by which management assesses the performance and evaluates the results of each segment. Accordingly, these expenses are included in Unallocated and other.

The following table represents the expenses recognized related to employee termination benefits during the year ended September 30, 2019 and the estimated remaining liability, which is included in the Consolidated Balance Sheet primarily within Accrued expenses and other liabilities:


(In millions)	Employee Termination Benefits
Balance at September 30, 2018	$	—
Expenses recognized during the period	13
Payments	(3)
Changes in estimates ^(a)	(1)
Balance at September 30, 2019	$	9

(a)Changes in estimate of previously-recognized expenses primarily due to modifications of employee remaining service periods.