Financial Information for Subsidiary Guarantors and Non-Guarantors

3 Months Ended

Mar. 31, 2017

Financial Information for Subsidiary Guarantors and Non-Guarantors Disclosure

Financial Information for Subsidiary Guarantors and Non-Guarantors

17.  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.

	March 31, 2017
			Guarantor		Non-Guarantor
Balance Sheet	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Current assets:
Cash and cash equivalents	$	—	$	—	$	312	$	—	$	312
Trade receivables, net						844				844
Inventories						1,051				1,051
Prepaid expenses and other current assets						212				212
Total current assets		—		—		2,419		—		2,419
Investments in and advances to subsidiaries		1,203		1,180				(2,383)		—
Property, plant and equipment, net						2,926				2,926
Goodwill						2,524				2,524
Intangibles, net						485				485
Other assets						1,105				1,105
Total assets	$	1,203	$	1,180	$	9,459	$	(2,383)	$	9,459
Current liabilities :
Short-term loans and long-term debt due within one year	$	—	$	—	$	196	$	—	$	196
Current portion of asbestos liability		115								115
Accounts payable						1,017				1,017
Other liabilities		1				531		(1)		531
Total current liabilities		116		—		1,744		(1)		1,859
Long-term debt		22				5,431		(22)		5,431
Asbestos-related liabilities		565								565
Other long-term liabilities						988				988
Share owners’ equity		500		1,180		1,180		(2,360)		500
Noncontrolling interests						116				116
Total liabilities and share owners’ equity	$	1,203	$	1,180	$	9,459	$	(2,383)	$	9,459

	December 31, 2016
					Non-
			Guarantor		Guarantor
Balance Sheet	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Current assets:
Cash and cash equivalents	$	—	$	—	$	492	$	—	$	492
Trade receivables, net						580				580
Inventories						983				983
Prepaid expenses and other current assets						199				199
Total current assets		—		—		2,254		—		2,254
Investments in and advances to subsidiaries		1,198		946				(2,144)		—
Property, plant and equipment, net						2,880				2,880
Goodwill						2,462				2,462
Intangibles, net						464				464
Other assets						1,075				1,075
Total assets	$	1,198	$	946	$	9,135	$	(2,144)	$	9,135
Current liabilities :
Short-term loans and long-term debt due within one year	$	—	$	—	$	195	$	—	$	195
Current portion of asbestos liability		115								115
Accounts payable						1,135				1,135
Other liabilities		2				615		(2)		615
Total current liabilities		117		—		1,945		(2)		2,060
Long-term debt		250				5,133		(250)		5,133
Asbestos-related liabilities		577								577
Other long-term liabilities						1,002				1,002
Share owners’ equity		254		946		946		(1,892)		254
Noncontrolling interests						109				109
Total liabilities and share owners’ equity	$	1,198	$	946	$	9,135	$	(2,144)	$	9,135

	March 31, 2016
					Non-
			Guarantor		Guarantor
Balance Sheet	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Current assets:
Cash and cash equivalents	$	—	$	—	$	239	$	—	$	239
Trade receivables, net						771				771
Inventories						1,107				1,107
Prepaid expenses and other current assets						359				359
Total current assets		—		—		2,476		—		2,476
Investments in and advances to subsidiaries		1,362		1,105				(2,467)		—
Property, plant and equipment, net						2,996				2,996
Goodwill						2,532				2,532
Intangibles, net						587				587
Other assets						1,097				1,097
Total assets	$	1,362	$	1,105	$	9,688	$	(2,467)	$	9,688
Current liabilities :
Short-term loans and long-term debt due within one year	$	—	$	—	$	239	$	—	$	239
Current portion of asbestos liability		130								130
Accounts payable						1,050				1,050
Other liabilities		7				467		(7)		467
Total current liabilities		137		—		1,756		(7)		1,886
Long-term debt		250				5,662		(250)		5,662
Asbestos-related liabilities		676								676
Other long-term liabilities						1,048				1,048
Share owners’ equity		299		1,105		1,105		(2,210)		299
Noncontrolling interests						117				117
Total liabilities and share owners’ equity	$	1,362	$	1,105	$	9,688	$	(2,467)	$	9,688

	Three months ended March 31, 2017
					Non-
			Guarantor		Guarantor
Results of Operations	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net sales	$	—	$	—	$	1,615	$	—	$	1,615
Cost of goods sold						(1,300)				(1,300)
Gross profit		—		—		315		—		315
Selling and administrative expense						(119)				(119)
Research, development and engineering expense						(15)				(15)
Net intercompany interest		21				(21)				—
Interest expense, net		(21)				(57)				(78)
Equity earnings from subsidiaries		49		49				(98)		—
Other equity earnings						15				15
Other expense, net						(45)				(45)
Earnings before income taxes		49		49		73		(98)		73
Provision for income taxes						(20)				(20)
Earnings from continuing operations		49		49		53		(98)		53
Loss from discontinued operations										—
Net earnings		49		49		53		(98)		53
Net (earnings) attributable to noncontrolling interests						(4)				(4)
Net earnings attributable to the Company	$	49	$	49	$	49	$	(98)	$	49

	Three months ended March 31, 2017
					Non-
			Guarantor		Guarantor
Comprehensive Income	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net earnings	$	49	$	49	$	53	$	(98)	$	53
Other comprehensive income (loss), net		187		187		194		(374)		194
Total comprehensive loss		236		236		247		(472)		247
Comprehensive income attributable to noncontrolling interests						(7)				(7)
Comprehensive income attributable to the Company	$	236	$	236	$	240	$	(472)	$	240

	Three months ended March 31, 2016
					Non-
			Guarantor		Guarantor
Results of Operations	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net sales	$	—	$	—	$	1,588	$	—	$	1,588
Cost of goods sold						(1,269)				(1,269)
Gross profit		—		—		319		—		319
Selling and administrative expense						(129)				(129)
Research, development and engineering expense						(15)				(15)
Net intercompany interest		5				(5)				—
Interest expense, net		(5)				(61)				(66)
Equity earnings from subsidiaries		67		67				(134)		—
Other equity earnings						14				14
Other expense, net						(22)				(22)
Earnings before income taxes		67		67		101		(134)		101
Provision for income taxes						(27)				(27)
Earnings from continuing operations		67		67		74		(134)		74
Loss from discontinued operations						(1)				(1)
Net earnings		67		67		73		(134)		73
Net (earnings) attributable to noncontrolling interests						(6)				(6)
Net earnings attributable to the Company	$	67	$	67	$	67	$	(134)	$	67

	Three months ended March 31, 2016
					Non-
			Guarantor		Guarantor
Comprehensive Income	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net earnings	$	67	$	67	$	73	$	(134)	$	73
Other comprehensive income (loss), net		50		50		50		(100)		50
Total comprehensive loss		117		117		123		(234)		123
Comprehensive income attributable to noncontrolling interests						(9)				(9)
Comprehensive loss attributable to the Company	$	117	$	117	$	114	$	(234)	$	114

	Three months ended March 31, 2017
					Non-
			Guarantor		Guarantor
Cash Flows	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Cash utilized in operating activities	$	(12)	$	—	$	(325)	$	—	$	(337)
Cash utilized in investing activities						(114)				(114)
Cash provided by financing activities		12				245				257
Effect of exchange rate change on cash						14				14
Net change in cash		—		—		(180)		—		(180)
Cash at beginning of period						492				492
Cash at end of period	$	—	$	—	$	312	$	—	$	312

	Three months ended March 31, 2016
					Non-
			Guarantor		Guarantor
Cash Flows	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Cash provided by (utilized in) operating activities	$	(11)	$	—	$	(291)	$	—	$	(302)
Cash utilized in investing activities						(133)				(133)
Cash provided by (utilized in) financing activities		11				265				276
Effect of exchange rate change on cash						(1)				(1)
Net change in cash		—		—		(160)		—		(160)
Cash at beginning of period						399				399
Cash at end of period	$	—	$	—	$	239	$	—	$	239