Financial Information for Subsidiary Guarantors and Non-Guarantors

9 Months Ended

Sep. 30, 2012

Financial Information for Subsidiary Guarantors and Non-Guarantors

Financial Information for Subsidiary Guarantors and Non-Guarantors

15. Financial Information for Subsidiary Guarantors and Non-Guarantors

The following presents condensed consolidating financial information for the Company, segregating:  (1) Owens-Illinois, Inc., the issuer of senior debentures (the “Parent”); (2) the two subsidiaries which have guaranteed the senior debentures on a subordinated basis (the “Guarantor Subsidiaries”); and (3) all other subsidiaries (the “Non-Guarantor Subsidiaries”).  The Guarantor Subsidiaries are 100% owned direct and indirect subsidiaries of the Company and their guarantees are full, unconditional and joint and several.  They have no operations and function only as intermediate holding companies.

Certain reclassifications have been made to conform all of the financial information to the financial presentation on a consolidated basis.  The principal eliminations relate to investments in subsidiaries and intercompany balances and transactions.

	September 30, 2012
					Non-
			Guarantor		Guarantor
Balance Sheet	Parent		Subsidiaries		Subsidiaries		Eliminations			Consolidated
Current assets:
Accounts receivable	$	—	$	—	$	1,133	$	—		$	1,133
Inventories					1,228					1,228
Other current assets					427					427
Total current assets	—		—		2,788		—			2,788
Investments in and advances to subsidiaries	1,921		1,671				(3,592		)	—
Goodwill					2,065					2,065
Other non-current assets					1,283					1,283
Total other assets	1,921		1,671		3,348		(3,592		)	3,348
Property, plant and equipment, net					2,735					2,735
Total assets	$	1,921	$	1,671	$	8,871	$	(3,592	)	$	8,871
Current liabilities :
Accounts payable and accrued liabilities	$	—	$	—	$	1,517	$	—		$	1,517
Current portion of asbestos liability	165									165
Short-term loans and long-term debt due within one year					356					356
Total current liabilities	165		—		1,873		—			2,038
Long-term debt	250				3,537		(250		)	3,537
Asbestos-related liabilities	220									220
Other non-current liabilities					1,640					1,640
Total share owners’ equity of the Company	1,286		1,671		1,671		(3,342		)	1,286
Noncontrolling interests					150					150
Total liabilities and share owners’ equity	$	1,921	$	1,671	$	8,871	$	(3,592	)	$	8,871

	December 31, 2011
					Non-
			Guarantor		Guarantor
Balance Sheet	Parent		Subsidiaries		Subsidiaries		Eliminations			Consolidated
Current assets:
Accounts receivable	$	—	$	—	$	1,158	$	—		$	1,158
Inventories					1,061					1,061
Other current assets					524					524
Total current assets	—		—		2,743		—			2,743
Investments in and advances to subsidiaries	1,609		1,359				(2,968		)	—
Goodwill					2,082					2,082
Other non-current assets					1,273					1,273
Total other assets	1,609		1,359		3,355		(2,968		)	3,355
Property, plant and equipment, net					2,877					2,877
Total assets	$	1,609	$	1,359	$	8,975	$	(2,968	)	$	8,975
Current liabilities :
Accounts payable and accrued liabilities	$	—	$	—	$	1,674	$	—		$	1,674
Current portion of asbestos liability	165									165
Short-term loans and long-term debt due within one year					406					406
Total current liabilities	165		—		2,080		—			2,245
Long-term debt	250				3,627		(250		)	3,627
Asbestos-related liabilities	306									306
Other non-current liabilities					1,756					1,756
Total share owners’ equity of the Company	888		1,359		1,359		(2,718		)	888
Noncontrolling interests					153					153
Total liabilities and share owners’ equity	$	1,609	$	1,359	$	8,975	$	(2,968	)	$	8,975

	September 30, 2011
					Non-
			Guarantor		Guarantor
Balance Sheet	Parent		Subsidiaries		Subsidiaries		Eliminations			Consolidated
Current assets:
Accounts receivable	$	—	$	—	$	1,218	$	—		$	1,218
Inventories					1,101					1,101
Other current assets					369					369
Total current assets	—		—		2,688		—			2,688
Investments in and advances to subsidiaries	2,613		2,363				(4,976		)	—
Goodwill					2,762					2,762
Other non-current assets					1,220					1,220
Total other assets	2,613		2,363		3,982		(4,976		)	3,982
Property, plant and equipment, net					2,931					2,931
Total assets	$	2,613	$	2,363	$	9,601	$	(4,976	)	$	9,601
Current liabilities :
Accounts payable and accrued liabilities	$	—	$	—	$	1,598	$	—		$	1,598
Current portion of asbestos liability	170									170
Short-term loans and long-term debt due within one year					345					345
Total current liabilities	170		—		1,943		—			2,113
Long-term debt	250				3,743		(250		)	3,743
Asbestos-related liabilities	204									204
Other non-current liabilities					1,398					1,398
Total share owners’ equity of the Company	1,989		2,363		2,363		(4,726		)	1,989
Noncontrolling interests					154					154
Total liabilities and share owners’ equity	$	2,613	$	2,363	$	9,601	$	(4,976	)	$	9,601

	Three months ended September 30, 2012
						Non-
				Guarantor		Guarantor
Results of Operations	Parent			Subsidiaries		Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—	$	1,747		$	—		$	1,747
Manufacturing, shipping and delivery						(1,405		)				(1,405		)
Gross profit	—			—		342			—			342
Research, engineering, selling, administrative, and other						(180		)				(180		)
Net intercompany interest	5					(5		)				—
Interest expense	(5		)			(56		)				(61		)
Interest income						2						2
Equity earnings from subsidiaries	90			90					(180		)	—
Other equity earnings						16						16
Other income						8						8
Earnings before income taxes	90			90		127			(180		)	127
Provision for income taxes						(28		)				(28		)
Earnings from continuing operations	90			90		99			(180		)	99
Loss from discontinued operations						(2		)				(2		)
Net earnings	90			90		97			(180		)	97
Net earnings attributable to noncontrolling interests						(7		)				(7		)
Net earnings attributable to the Company	$	90		$	90	$	90		$	(180	)	$	90

	Three months ended September 30, 2012
					Non-
			Guarantor		Guarantor
Comprehensive Income	Parent		Subsidiaries		Subsidiaries			Eliminations			Consolidated
Net earnings	$	90	$	90	$	97		$	(180	)	$	97
Other comprehensive income	103		103		81			(182		)	105
Total comprehensive income	193		193		178			(362		)	202
Comprehensive income attributable to noncontrolling interests					(9		)				(9		)
Comprehensive income attributable to the Company	$	193	$	193	$	169		$	362	)	$	193

	Three months ended September 30, 2011
						Non-
				Guarantor		Guarantor
Results of Operations	Parent			Subsidiaries		Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—	$	1,862		$	—		$	1,862
Manufacturing, shipping and delivery						(1,475		)				(1,475		)
Gross profit	—			—		387			—			387
Research, engineering, selling, administrative, and other						(196		)				(196		)
Net intercompany interest	5					(5		)				—
Interest expense	(5		)			(65		)				(70		)
Interest income						2						2
Equity earnings from subsidiaries	116			116					(232		)	—
Other equity earnings						19						19
Other income						6						6
Earnings from continuing operations before income taxes	116			116		148			(232		)	148
Provision for income taxes						(25		)				(25		)
Earnings from continuing operations	116			116		123			(232		)	123
Loss from discontinued operations						(3		)				(3		)
Net earnings	116			116		120			(232		)	120
Net earnings attributable to noncontrolling interest						(4		)				(4		)
Net earnings attributable to the Company	$	116		$	116	$	116		$	(232	)	$	116

	Three months ended September 30, 2011
							Non-
				Guarantor			Guarantor
Comprehensive Income	Parent			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Net earnings	$	116		$	116		$	120		$	(232	)	$	120
Other comprehensive income	(315		)	(315		)	(341		)	650			(321		)
Total comprehensive income	(199		)	(199		)	(221		)	418			(201		)
Comprehensive income attributable to noncontrolling interests							2						2
Comprehensive income attributable to the Company	$	(199	)	$	(199	)	$	(219	)	$	418		$	(199	)

	Nine months ended September 30, 2012
						Non-
				Guarantor		Guarantor
Results of Operations	Parent			Subsidiaries		Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—	$	5,252		$	—		$	5,252
Manufacturing, shipping, and delivery						(4,156		)				(4,156		)
Gross profit	—			—		1,096			—			1,096
Research, engineering, selling, administrative, and other						(510		)				(510		)
Net intercompany interest	15					(15		)	—			—
Interest expense	(15		)			(172		)				(187		)
Interest income						7			—			7
Equity earnings from subsidiaries	344			344					(688		)	—
Other equity earnings						47						47
Other income						23						23
Earnings from continuing operations before income taxes	344			344		476			(688		)	476
Provision for income taxes						(113		)				(113		)
Earnings from continuing operations	344			344		363			(688		)	363
Loss from discontinued operations						(4		)				(4		)
Net earnings	344			344		359			(688		)	359
Net earnings attributable to noncontrolling interest						(15		)				(15		)
Net earnings attributable to the Company	$	344		$	344	$	344		$	(688	)	$	344

	Nine months ended September 30, 2012
					Non-
			Guarantor		Guarantor
Comprehensive Income	Parent		Subsidiaries		Subsidiaries			Eliminations			Consolidated
Net earnings	$	344	$	344	$	359		$	(688	)	$	359
Other comprehensive income (loss)	51		51		(16		)	(29		)	57
Total comprehensive income	395		395		343			(717		)	416
Comprehensive income attributable to noncontrolling interests					(21		)				(21		)
Comprehensive income attributable to the Company	$	395	$	395	$	322		$	(717	)	$	395

	Nine months ended September 30, 2011
						Non-
				Guarantor		Guarantor
Results of Operations	Parent			Subsidiaries		Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—	$	5,540		$	—		$	5,540
Manufacturing, shipping and delivery						(4,455		)				(4,455		)
Gross profit	—			—		1,085			—			1,085
Research, engineering, selling, administrative, and other						(544		)				(544		)
Net intercompany interest	15					(15		)				—
Interest expense	(15		)			(231		)				(246		)
Interest income						8						8
Equity earnings from subsidiaries	271			271					(542		)	—
Other equity earnings						52						52
Other income						18						18
Earnings from continuing operations before income taxes	271			271		373			(542		)	373
Provision for income taxes						(85		)				(85		)
Earnings from continuing operations	271			271		288			(542		)	288
Loss from discontinued operations						(2		)				(2		)
Net earnings	271			271		286			(542		)	286
Net earnings attributable to noncontrolling interest						(15		)				(15		)
Net earnings attributable to the Company	$	271		$	271	$	271		$	(542	)	$	271

	Nine months ended September 30, 2011
							Non-
				Guarantor			Guarantor
Comprehensive Income	Parent			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Net earnings	$	271		$	271		$	286		$	(542	)	$	286
Other comprehensive income	(81		)	(81		)	(141		)	225			(78		)
Total comprehensive income	190			190			145			(317		)	208
Comprehensive income attributable to noncontrolling interests							(18		)				(18		)
Comprehensive income attributable to the Company	$	190		$	190		$	127		$	(317	)	$	190

	Nine months ended September 30, 2012
						Non-
				Guarantor		Guarantor
Cash Flows	Parent			Subsidiaries		Subsidiaries			Eliminations		Consolidated
Cash provided by (used in) operating activities	$	(86	)	$	—	$	313		$	—	$	227
Cash used in investing activities						(125		)			(125		)
Cash provided by (used in) financing activities	86					(265		)			(179		)
Effect of exchange rate change on cash						13					13
Net change in cash	—			—		(64		)	—		(64		)
Cash at beginning of period						400					400
Cash at end of period	$	—		$	—	$	336		$	—	$	336

	Nine months ended September 30, 2011
						Non-
				Guarantor		Guarantor
Cash Flows	Parent			Subsidiaries		Subsidiaries			Eliminations		Consolidated
Cash provided by (used in) operating activities	$	(102	)	$	—	$	382		$	—	$	280
Cash used in investing activities						(351		)			(351		)
Cash provided by (used in) financing activities	102					(418		)			(316		)
Effect of exchange rate change on cash						3					3
Net change in cash	—			—		(384		)	—		(384		)
Cash at beginning of period						640					640
Cash at end of period	$	—		$	—	$	256		$	—	$	256