Revenue Recognition (Tables)

12 Months Ended

Sep. 30, 2019

Revenue from Contract with Customer [Abstract]

Schedule of Cumulative Effect and Impact of New Accounting Pronouncements

The following table reconciles the Consolidated Balance Sheet line items impacted by the cumulative effect of adoption of the new revenue recognition accounting guidance on October 1, 2018:

(In millions)	September 30, 2018 as reported		Adjustments		Balances at October 1, 2018
Accounts receivable, net	$	409	$	(33)	$	376
Inventory, net	$	176	$	14	$	190
Deferred income taxes	$	138	$	6	$	144
Retained deficit	$	399	$	13	$	412

Most revenue transactions and activities recorded under the new revenue recognition accounting guidance are substantially consistent with the treatment under prior guidance. The following tables summarize the impact of the new revenue accounting guidance on Valvoline’s Consolidated Balance Sheet and Consolidated Statement of Comprehensive Income as of and for the year ended September 30, 2019:

Impact of Changes to Consolidated Balance Sheet
	As of September 30, 2019
(In millions)	As reported		Adjustments (a)		Under prior guidance
Accounts receivable, net	$	401	$	37	$	438
Inventories, net	$	194	$	(15)	$	179
Deferred income taxes	$	123	$	(6)	$	117
Accrued expenses and other liabilities	$	237	$	(1)	$	236
Retained deficit	$	284	$	(15)	$	269

(a)Adjustments include the opening retained deficit adjustments as detailed in the table above.

Impact of Changes to Consolidated Statement of Comprehensive Income
	Year ended September 30, 2019
(In millions)	As reported		Adjustments		Under prior guidance
Sales	$	2,390	$	(50)	$	2,340
Cost of sales	1,580		(59)		1,521
Gross profit	$	810	$	9	$	819
Selling, general and administrative expenses	$	449	$	7	$	456
Equity and other income, net	$	40	$	1	$	41
Operating income	$	398	$	3	$	401
Income before income taxes	$	265	$	3	$	268
Income tax expense	$	57	$	1	$	58
Net income	$	208	$	2	$	210
Basic earnings per share	$	1.10	$	0.01	$	1.11
Diluted earnings per share	$	1.10	$	0.01	$	1.11

Schedule of Disaggregated Revenues

The following summarizes sales by primary customer channel for the Company’s reportable segments:

	Year ended
(In millions)	September 30, 2019
Quick Lubes
Company-owned operations	$	531
Non-company owned operations	291
Total Quick Lubes	822
Core North America
Retail	543
Installer and other	451
Total Core North America	994
International	574
Consolidated sales	$	2,390

Sales by reportable segment disaggregated by geographic market follows for the year ended September 30, 2019:

(In millions)	Quick Lubes		Core North America		International		Totals
North America (a)	$	822	$	994	$	—	$	1,816
Europe, Middle East and Africa ("EMEA")	—		—		181		181
Asia Pacific	—		—		285		285
Latin America (a)	—		—		108		108
Total	$	822	$	994	$	574	$	2,390

(a)Valvoline includes the United States and Canada in its North America region. Mexico is included within the Latin America region.

Disaggregation of Sales by Timing of Revenue Recognized

The following disaggregates the Company’s sales by timing of revenue recognized:

	Year ended
(In millions)	September 30, 2019
Sales at a point in time	$	2,346
Franchised revenues transferred over time	44
Consolidated sales	$	2,390