Stock-Based Compensation Plans (Tables)

12 Months Ended

Sep. 30, 2021

Share-based Payment Arrangement [Abstract]

Schedule of Stock-based Compensation Expense

The following summarizes stock-based compensation expense recognized by the Company during the years ended September 30:

(In millions)	2021		2020		2019
Stock appreciation rights	$	1	$	1	$	1
Nonvested stock awards (a)	14		11		9
Total stock-based compensation expense, pre-tax	15		12		10
Tax benefit	(4)		(3)		(2)
Total stock-based compensation expense, net of tax	$	11	$	9	$	8

(a)Includes approximately $1 million in each period presented related to certain awards that are cash-settled and liability-classified; therefore, fair value is remeasured at the end of each reporting period until settlement.

Summary of Nonvested Stock Award Activity

The following summarizes nonvested stock award activity during the year ended September 30, 2021:

	Number of shares (in thousands)	Weighted average grant date fair value per share
Unvested shares as of September 30, 2020	1,668	$	20.89
Granted	520	$	22.33
Performance adjustments (a)	126	$	22.96
Vested	(288)	$	22.69
Forfeited	(58)	$	21.85
Unvested shares as of September 30, 2021	1,968	$	21.50

(a)Adjustments based on current attainment expectations of performance targets.

Summary of Fair Value Assumptions Utilized in Monte Carlo Model to Determine Value of Awards

with the following key assumptions:

	2021			2020			2019
Weighted average grant date fair value per share	$	21.81		$	23.21		$	21.22
Assumptions (weighted average)
Risk-free interest rates (a)	0.2		%	1.6		%	2.8		%
Expected dividend yield	2.3		%	2.1		%	1.3		%
Expected volatility (b)	42.0		%	26.0		%	26.8		%
Expected term (in years)	3.0			3.0			3.0

(a)Based on the U.S. Treasury yield curve in effect at the time of grant or modification for the expected term of the award. The range of risk-free interest rates used for performance awards was 0.13% to 0.23% in fiscal 2021, 1.55% to 1.59% in fiscal 2020, and 2.66% to 2.82% in fiscal 2019.

(b)Expected volatility is based on historical volatilities over periods commensurate with the expected term. In recent years, Valvoline utilized its historical daily closing price over this period, and in fiscal 2019, expected volatility was determined based on the average of peer companies due to Valvoline's lack of historical data at the time.

Share-based Payment Arrangement, Nonvested Award, Cost and Weighted Avg Grant Date FV

The total grant date fair value of nonvested stock awards vested and the weighted average grant date fair value of nonvested stock awards granted follows for the years ended September 30:

(In millions, except weighted average)	2021		2020		2019
Total grant date fair value of shares vested	$	7	$	5	$	12
Weighted average grant date fair value	$	22.33	$	22.17	$	20.72