Financial Information for Subsidiary Guarantors and Non-Guarantors

6 Months Ended

Jun. 30, 2016

Financial Information for Subsidiary Guarantors and Non-Guarantors Disclosure

Financial Information for Subsidiary Guarantors and Non-Guarantors

19.  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.

	June 30, 2016
			Guarantor		Non-Guarantor
Balance Sheet	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Current assets:
Cash and cash equivalents	$	—	$	—	$	334	$	—	$	334
Trade receivables, net						831				831
Inventories						1,051				1,051
Prepaid expenses and other current assets						358				358
Total current assets		—		—		2,574		—		2,574
Investments in and advances to subsidiaries		1,394		1,142				(2,536)		—
Property, plant and equipment, net						2,932				2,932
Goodwill						2,536				2,536
Intangibles						517				517
Other assets						1,108				1,108
Total assets	$	1,394	$	1,142	$	9,667	$	(2,536)	$	9,667
Current liabilities :
Short-term loans and long-term debt due within one year	$	—	$	—	$	305	$	—	$	305
Current portion of asbestos liability		130								130
Accounts payable						1,042				1,042
Other liabilities		2				518		(2)		518
Total current liabilities		132		—		1,865		(2)		1,995
Long-term debt		250				5,549		(250)		5,549
Asbestos-related liabilities		663								663
Other long-term liabilities						1,002				1,002
Share owners’ equity		349		1,142		1,142		(2,284)		349
Noncontrolling interests						109				109
Total liabilities and share owners’ equity	$	1,394	$	1,142	$	9,667	$	(2,536)	$	9,667

	December 31, 2015
					Non-
			Guarantor		Guarantor
Balance Sheet	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Current assets:
Cash and cash equivalents	$	—	$	—	$	399	$	—	$	399
Trade receivables, net						562				562
Inventories						1,007				1,007
Prepaid expenses and other current assets						366				366
Total current assets		—		—		2,334		—		2,334
Investments in and advances to subsidiaries		1,240		988				(2,228)		—
Property, plant and equipment, net						2,961				2,961
Goodwill						2,489				2,489
Intangibles						597				597
Other assets						1,040				1,040
Total assets	$	1,240	$	988	$	9,421	$	(2,228)	$	9,421
Current liabilities :
Short-term loans and long-term debt due within one year	$	—	$	—	$	228	$	—	$	228
Current portion of asbestos liability		130								130
Accounts payable						1,212				1,212
Other liabilities		2				552		(2)		552
Total current liabilities		132		—		1,992		(2)		2,122
Long-term debt		250				5,345		(250)		5,345
Asbestos-related liabilities		687								687
Other long-term liabilities						988				988
Share owners’ equity		171		988		988		(1,976)		171
Noncontrolling interests						108				108
Total liabilities and share owners’ equity	$	1,240	$	988	$	9,421	$	(2,228)	$	9,421

	June 30, 2015
					Non-
			Guarantor		Guarantor
Balance Sheet	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Current assets:
Cash and cash equivalents	$	—	$	—	$	378	$	—	$	378
Trade receivables, net						712				712
Inventories						985				985
Prepaid expenses and other current assets						310				310
Total current assets		—		—		2,385		—		2,385
Investments in and advances to subsidiaries		1,636		1,384				(3,020)		—
Property, plant and equipment, net						2,386				2,386
Goodwill						1,789				1,789
Other assets						1,058				1,058
Total assets	$	1,636	$	1,384	$	7,618	$	(3,020)	$	7,618
Current liabilities :
Short-term loans and long-term debt due within one year	$	—	$	—	$	555	$	—	$	555
Current portion of asbestos liability		143								143
Accounts payable						983				983
Other liabilities		2				458		(2)		458
Total current liabilities		145		—		1,996		(2)		2,139
Long-term debt		250				3,217		(250)		3,217
Asbestos-related liabilities		762								762
Other long-term liabilities						909				909
Share owners’ equity		479		1,384		1,384		(2,768)		479
Noncontrolling interests						112				112
Total liabilities and share owners’ equity	$	1,636	$	1,384	$	7,618	$	(3,020)	$	7,618

	Three months ended June 30, 2016
					Non-
			Guarantor		Guarantor
Results of Operations	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net sales	$	—	$	—	$	1,760	$	—	$	1,760
Cost of goods sold						(1,418)				(1,418)
Gross profit		—		—		342		—		342
Selling and administrative expense						(126)				(126)
Research, development and engineering expense						(16)				(16)
Net intercompany interest		5				(5)				—
Interest expense, net		(5)				(62)				(67)
Equity earnings from subsidiaries		105		105				(210)		—
Other equity earnings						15				15
Other expense, net						(7)				(7)
Earnings before income taxes		105		105		141		(210)		141
Provision for income taxes						(30)				(30)
Earnings from continuing operations		105		105		111		(210)		111
Loss from discontinued operations						(2)				(2)
Net earnings		105		105		109		(210)		109
Net (earnings) attributable to noncontrolling interests						(4)				(4)
Net earnings attributable to the Company	$	105	$	105	$	105	$	(210)	$	105

	Three months ended June 30, 2016
					Non-
			Guarantor		Guarantor
Comprehensive Income	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net earnings	$	105	$	105	$	109	$	(210)	$	109
Other comprehensive income, net		(66)		(66)		(74)		132		(74)
Total comprehensive loss		39		39		35		(78)		35
Comprehensive income attributable to noncontrolling interests						8				8
Comprehensive loss attributable to the Company	$	39	$	39	$	43	$	(78)	$	43

	Three months ended June 30, 2015
					Non-
			Guarantor		Guarantor
Results of Operations	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net sales	$	—	$	—	$	1,543	$	—	$	1,543
Cost of goods sold						(1,269)				(1,269)
Gross profit		—		—		274		—		274
Selling and administrative expense						(118)				(118)
Research, development and engineering expense						(16)				(16)
Net intercompany interest		5				(5)				—
Interest expense, net		(5)				(69)				(74)
Equity earnings from subsidiaries		40		40				(80)		—
Other equity earnings						14				14
Other expense, net						(18)				(18)
Earnings before income taxes		40		40		62		(80)		62
Provision for income taxes						(15)				(15)
Earnings from continuing operations		40		40		47		(80)		47
Loss from discontinued operations						(2)				(2)
Net earnings		40		40		45		(80)		45
Net (earnings) attributable to noncontrolling interests						(5)				(5)
Net earnings attributable to the Company	$	40	$	40	$	40	$	(80)	$	40

	Three months ended June 30, 2015
					Non-
			Guarantor		Guarantor
Comprehensive Income	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net earnings	$	40	$	40	$	45	$	(80)	$	45
Other comprehensive income, net		28		28		29		(56)		29
Total comprehensive loss		68		68		74		(136)		74
Comprehensive income attributable to noncontrolling interests						(1)				(1)
Comprehensive loss attributable to the Company	$	68	$	68	$	73	$	(136)	$	73

	Six months ended June 30, 2016
					Non-
			Guarantor		Guarantor
Results of Operations	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net sales	$	—	$	—	$	3,348	$	—	$	3,348
Cost of goods sold						(2,687)				(2,687)
Gross profit		—		—		661		—		661
Selling and administrative expense						(254)				(254)
Research, development and engineering expense						(32)				(32)
Net intercompany interest		10				(10)				—
Interest expense, net		(10)				(123)				(133)
Equity earnings from subsidiaries		172		172				(344)		—
Other equity earnings						29				29
Other expense, net						(29)				(29)
Earnings before income taxes		172		172		242		(344)		242
Provision for income taxes						(57)				(57)
Earnings from continuing operations		172		172		185		(344)		185
Loss from discontinued operations						(3)				(3)
Net earnings		172		172		182		(344)		182
Net (earnings) attributable to noncontrolling interests						(10)				(10)
Net earnings attributable to the Company	$	172	$	172	$	172	$	(344)	$	172

	Six months ended June 30, 2016
					Non-
			Guarantor		Guarantor
Comprehensive Income	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net earnings	$	172	$	172	$	182	$	(344)	$	182
Other comprehensive income, net		(26)		(26)		(24)		52		(24)
Total comprehensive loss		146		146		158		(292)		158
Comprehensive income attributable to noncontrolling interests						(2)				(2)
Comprehensive income (loss) attributable to the Company	$	146	$	146	$	156	$	(292)	$	156

	Six months ended June 30, 2015
					Non-
			Guarantor		Guarantor
Results of Operations	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net sales	$	—	$	—	$	2,964	$	—	$	2,964
Cost of goods sold						(2,422)				(2,422)
Gross profit				—		542				542
Selling and administrative expense						(242)				(242)
Research, development and engineering expense						(31)				(31)
Net intercompany interest		10				(10)				—
Interest expense, net		(10)				(111)				(121)
Equity earnings from subsidiaries		111		111				(222)		—
Other equity earnings						29				29
Other expense, net						(15)				(15)
Earnings before income taxes		111		111		162		(222)		162
Provision for income taxes						(40)				(40)
Earnings from continuing operations		111		111		122		(222)		122
Loss from discontinued operations						(2)				(2)
Net earnings		111		111		120		(222)		120
Net (earnings) attributable to noncontrolling interests						(9)				(9)
Net earnings attributable to the Company	$	111	$	111	$	111	$	(222)	$	111

	Six months ended June 30, 2015
					Non-
			Guarantor		Guarantor
Comprehensive Income	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net earnings	$	111	$	111	$	120	$	(222)	$	120
Other comprehensive income, net		(192)		(192)		(191)		384		(191)
Total comprehensive loss		(81)		(81)		(71)		162		(71)
Comprehensive income attributable to noncontrolling interests						(1)				(1)
Comprehensive loss attributable to the Company	$	(81)	$	(81)	$	(72)	$	162	$	(72)

	Six months ended June 30, 2016
					Non-
			Guarantor		Guarantor
Cash Flows	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Cash provided by (utilized in) operating activities	$	(24)	$	—	$	(86)	$	—	$	(110)
Cash utilized in investing activities						(190)				(190)
Cash provided by (utilized in) financing activities		24				214				238
Effect of exchange rate change on cash						(3)				(3)
Net change in cash		—		—		(65)		—		(65)
Cash at beginning of period						399				399
Cash at end of period	$	—	$	—	$	334	$	—	$	334

	Six months ended June 30, 2015
					Non-
			Guarantor		Guarantor
Cash Flows	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Cash provided by (utilized in) operating activities	$	(35)	$	—	$	(77)	$	—	$	(112)
Cash utilized in investing activities						(254)				(254)
Cash provided by financing activities		35				217				252
Effect of exchange rate change on cash						(20)				(20)
Net change in cash		—		—		(134)		—		(134)
Cash at beginning of period						512				512
Cash at end of period	$	—	$	—	$	378	$	—	$	378