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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
for the Quarterly Period Ended March 31, 2020
Commission File Number 1-9608
NEWELL BRANDS INC.
(Exact name of registrant as specified in its charter)
Delaware36-3514169
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
6655 Peachtree Dunwoody Road,
Atlanta, Georgia 30328
(Address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code: (770) 418-7000
Securities registered pursuant to Section 12(b) of the Act:
TITLE OF EACH CLASSTRADING SYMBOLNAME OF EXCHANGE ON WHICH REGISTERED
Common stock, $1 par value per shareNWLNasdaq Stock Market LLC
Securities registered pursuant to Section 12(g) of the Act:    None
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  No 
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes   No 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:
Large Accelerated FilerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No 
Number of shares of common stock outstanding (net of treasury shares) as April 27, 2020: 424.1 million.



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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
NEWELL BRANDS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Amounts in millions, except per share data)
Three Months Ended
March 31,
20202019
Net sales$1,886  $2,042  
Cost of products sold1,269  1,387  
Gross profit617  655  
Selling, general and administrative expenses548  569  
Restructuring costs, net2  11  
Impairment of goodwill, intangibles and other assets1,475  63  
Operating income (loss)(1,408) 12  
Non-operating expenses:
Interest expense, net63  80  
Other expense, net12  26  
Loss before income taxes(1,483) (94) 
Income tax benefit(204) (20) 
Loss from continuing operations(1,279) (74) 
Loss from discontinued operations, net of tax  (77) 
Net loss$(1,279) $(151) 
Weighted average common shares outstanding:
Basic423.8  423.0  
Diluted423.8  423.0  
Loss per share:
Basic:
Loss from continuing operations$(3.02) $(0.18) 
Loss from discontinued operations  (0.18) 
Net loss$(3.02) $(0.36) 
Diluted:
Loss from continuing operations$(3.02) $(0.18) 
Loss from discontinued operations  (0.18) 
Net loss$(3.02) $(0.36) 
See Notes to Condensed Consolidated Financial Statements (Unaudited).
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NEWELL BRANDS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited)
(Amounts in millions)
Three Months Ended
March 31,
20202019
Comprehensive loss:
Net loss$(1,279) $(151) 
Other comprehensive loss, net of tax
Foreign currency translation adjustments(156) (2) 
Unrecognized pension and postretirement costs(5) (13) 
Derivative financial instruments26  (9) 
Total other comprehensive loss, net of tax(135) (24) 
Comprehensive loss$(1,414) $(175) 
See Notes to Condensed Consolidated Financial Statements (Unaudited).
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NEWELL BRANDS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(Amounts in millions, except par values)
March 31,
2020
December 31,
2019
Assets:
Cash and cash equivalents$476  $349  
Accounts receivable, net1,398  1,842  
Inventories1,700  1,606  
Prepaid expenses and other343  313  
Total current assets3,917  4,110  
Property, plant and equipment, net1,123  1,155  
Operating lease assets, net561  615  
Goodwill3,483  3,709  
Other intangible assets, net3,567  4,916  
Deferred income taxes873  776  
Other assets379  361  
Total assets$13,903  $15,642  
Liabilities:
Accounts payable$1,036  $1,102  
Accrued compensation124  204  
Other accrued liabilities1,152  1,340  
Short-term debt and current portion of long-term debt639  332  
Total current liabilities2,951  2,978  
Long-term debt5,375  5,391  
Deferred income taxes498  625  
Long-term operating lease liabilities503  541  
Other noncurrent liabilities1,097  1,111  
Total liabilities10,424  10,646  
Commitments and contingencies (Footnote 18)
Stockholders’ equity:
Preferred stock (10.0 authorized shares, $1.00 par value, no shares issued at March 31, 2020 and December 31, 2019)
    
Common stock (800.0 authorized shares, $1.00 par value, 448.0 shares and 447.1 shares issued at March 31, 2020 and December 31, 2019)
448  447  
Treasury stock, at cost (23.9 shares and 23.6 shares issued at March 31, 2020 and December 31, 2019)
(596) (590) 
Additional paid-in capital8,340  8,430  
Retained deficit(3,683) (2,404) 
Accumulated other comprehensive loss(1,055) (920) 
Stockholders’ equity attributable to parent3,454  4,963  
Stockholders’ equity attributable to noncontrolling interests25  33  
Total stockholders’ equity3,479  4,996  
Total liabilities and stockholders’ equity$13,903  $15,642  
See Notes to Condensed Consolidated Financial Statements (Unaudited).
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NEWELL BRANDS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(Amounts in millions)
Three Months Ended
March 31,
20202019
Cash flows from operating activities:
Net loss$(1,279) $(151) 
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization91  87  
Impairment of goodwill, intangibles and other assets1,475  175  
Gain from sale of businesses, net(1) (5) 
Deferred income taxes(234) (47) 
Stock based compensation expense8  5  
Loss on change in fair value of investments3  17  
Other, net1  1  
Changes in operating accounts excluding the effects of acquisitions and divestitures:
Accounts receivable369  246  
Inventories(142) (259) 
Accounts payable(49) (107) 
Accrued liabilities and other(219) (162) 
Net cash provided by (used in) operating activities23  (200) 
Cash flows from investing activities:
Capital expenditures(58) (58) 
Other investing activities, net2  (18) 
Net cash used in investing activities(56) (76) 
Cash flows from financing activities:
Net receipts of short term debt305  521  
Payments on current portion of long-term debt  (268) 
Payments on long-term debt(16) (5) 
Loss on extinguishment of debt  (3) 
Cash dividends(99) (98) 
Equity compensation activity and other, net(17) (2) 
Net cash provided by financing activities173  145  
Exchange rate effect on cash, cash equivalents and restricted cash(24) (1) 
Increase (decrease) in cash, cash equivalents and restricted cash116  (132) 
Cash, cash equivalents and restricted cash at beginning of period371  496  
Cash, cash equivalents and restricted cash at end of period$487  $364  
Supplemental disclosures:
Restricted cash at beginning of period$22  $  
Restricted cash at end of period11    
Net cash provided by discontinued operating activities  8  
Net cash used in discontinued investing activities  (8) 
Capital expenditures for discontinued operations  8  
See Notes to Condensed Consolidated Financial Statements (Unaudited).
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+NEWELL BRANDS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (Unaudited)
(Amounts in millions)
Common
Stock
Treasury
Stock
Additional Paid-In CapitalRetained DeficitAccumulated Other Comprehensive LossStockholders' Equity Attributable to ParentNoncontrolling InterestTotal Stockholders' Equity
Balance at December 31, 2019$447  $(590) $8,430  $(2,404) $(920) $4,963  $33  $4,996  
Comprehensive loss—  —  —  (1,279) (135) (1,414) —  (1,414) 
Dividends declared on common stock—  —  (97) —  —  (97) —  (97) 
Equity compensation, net of tax1  (6) 7  —  —  2  —  2  
Distribution to non-controlling interests holder—  —  —  —  —  —  (3) (3) 
Other—  —  —  —  —  —  (5) (5) 
Balance at March 31, 2020$448  $(596) $8,340  $(3,683) $(1,055) $3,454  $25  $3,479  

Common
Stock
Treasury
Stock
Additional Paid-In CapitalRetained DeficitAccumulated Other Comprehensive LossStockholders' Equity Attributable to ParentNoncontrolling InterestTotal Stockholders' Equity
Balance at December 31, 2018$446  $(585) $8,781  $(2,511) $(913) $5,218  $35  $5,253  
Comprehensive loss—  —  —  (151) (24) (175) —  (175) 
Dividends declared on common stock—  —  (98) —  —  (98) —  (98) 
Equity compensation, net of tax1  (3) 5  —  —  3  —  3  
Balance at March 31, 2019$447  $(588) $8,688  $(2,662) $(937) $4,948  $35  $4,983  
See Notes to Condensed Consolidated Financial Statements (Unaudited).
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NEWELL BRANDS INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
Footnote 1 — Basis of Presentation and Significant Accounting Policies

The accompanying unaudited condensed consolidated financial statements of Newell Brands Inc. (formerly, Newell Rubbermaid Inc., and collectively with its subsidiaries, the “Company”) have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) and do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. In the opinion of management, the unaudited condensed consolidated financial statements include all adjustments (including normal recurring accruals) considered necessary for a fair statement of the financial position and the results of operations of the Company. It is recommended that these unaudited condensed consolidated financial statements be read in conjunction with the financial statements, and the footnotes thereto, included in the Company’s most recent Annual Report on Form 10-K. The Condensed Consolidated Balance Sheet at December 31, 2019, has been derived from the audited financial statements as of that date, but it does not include all the information and footnotes required by U.S. GAAP for complete financial statements. Certain reclassifications have been made in the Company’s financial statements of the prior year to conform to the current year presentation.

In connection with the Company’s decision to retain the Rubbermaid Commercial Products, Rubbermaid Outdoor, Closet, Refuse, Garage and Cleaning businesses, and the Mapa/Spontex and Quickie businesses, the Company realigned its management reporting structure in the third and fourth quarters of 2019. All prior periods have been reclassified to conform to the current reporting structure.

The Company operates and reports financial information in the following four reportable segments: Appliances and Cookware, Food and Commercial, Home and Outdoor Living, and Learning and Development. The Company also provides general corporate services to its segments which will be reported as a non-operating segment, Corporate (see Footnote 17).

Use of Estimates and Risks & Uncertainty of Coronavirus (COVID-19)

Beginning late in the fourth quarter 2019 and into 2020, a novel strain of the coronavirus, or COVID-19, initially resulted in travel disruption and impacted portions of the Company’s and its suppliers’ operations in China. Since then, the spread of COVID-19 has developed into a global pandemic, impacting the economies of most countries around the world. The Company’s global operations, similar to those of many large, multi-national corporations, have been impacted by the COVID-19 pandemic.
During the first quarter of 2020, the Company concluded that an impairment triggering event had occurred for all of its reporting units as the Company has experienced significant COVID-19 related disruption to its business in three primary areas: supply chain, as certain manufacturing and distribution facilities are temporarily closed in line with government guidelines; the temporary closure of secondary customer retail stores as well as the Company's Yankee Candle retail stores in North America; and changes in consumer demand patterns to certain focused categories. As a result, the Company performed an impairment test for its goodwill and indefinite-lived intangible assets. In addition, the Company performed a recoverability test for its long-lived assets which primarily include finite-lived intangible assets, property plant and equipment and right of use lease assets. As a result of the impairment testing performed in connection with the triggering event, the Company determined that certain of its goodwill, indefinite-lived intangible assets, property plant and equipment and right of use operating leases assets were impaired. The Company recorded an aggregate non-cash charge of approximately $1.5 billion during the three months ended March 31, 2020 in connection with these impairments. See Footnotes 6, 7 and 13 for further information.
As the COVID-19 pandemic continues to evolve, the Company believes the extent of the impact to its businesses, operating results, cash flows, liquidity and financial condition will be primarily driven by the severity and duration of the COVID-19 pandemic, the pandemic’s impact on the U.S. and global economies and the timing, scope and effectiveness of federal, state and local governmental responses to the pandemic. Those primary drivers are beyond the Company's knowledge and control, and as a result, at this time the Company is unable to predict the cumulative impact, both in terms of severity and duration, COVID-19 will have on its businesses, operating results, cash flows and financial condition, but it could be material if the current circumstances continue to exist for a prolonged period of time.
The consolidated condensed financial statements are prepared in conformity with U.S. GAAP. Management’s application of U.S. GAAP requires the pervasive use of estimates and assumptions in preparing the unaudited condensed consolidated financial statements. As discussed above, the world is currently experiencing the global COVID-19 pandemic which has required greater use of estimates and assumptions in the preparation of our condensed consolidated financial statements. More specifically, those estimates and assumptions utilized in the Company’s forecasted cash flows that form the basis in developing the fair values utilized in its impairment assessments as well as annual effective tax rate. This has included assumptions as to the duration and severity of the pandemic, timing and amount of demand shifts amongst sales channels, workforce availability, supply chain
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continuity, and timing as to a return to normalcy. We are experiencing short-term disruptions and anticipate such to continue in the foreseeable future, but anticipate an eventual return to normal demand. Although we have made our best estimates based upon current information, the effects of the COVID-19 pandemic on our business may result in future changes to management’s estimates and assumptions, especially if the severity worsens or duration lengthens. Actual results could materially differ from the estimates and assumptions developed by management. If so, the Company may be subject to future incremental impairment charges as well as changes to recorded reserves and valuations.
Discontinued Operations

On December 31, 2019, the Company completed the sale of its Playing Cards business to Cartamundi Inc. and Cartamundi España S.L., which completed its previously announced Accelerated Transformation Plan (“ATP”).

In connection with the ATP, the Company completed the sale of several businesses during 2018 and 2019. In 2018, the Company sold Goody Products, Inc. (“Goody”), Jostens, Inc. (“Jostens”), Pure Fishing, Inc. (“Pure Fishing”), the Rawlings Sporting Goods Company, Inc. (“Rawlings”), The Waddington Group, Inc. (“Waddington”) and other related subsidiaries. In 2019, the Company sold: the Process Solutions business, Rexair Holdings Inc. ("Rexair") and The United States Playing Card Company and other related subsidiaries. These businesses were classified as discontinued operations in periods prior to January 1, 2020.

Seasonal Variations

Sales of the Company’s products tend to be seasonal, with sales, operating income and operating cash flow in the first quarter generally lower than any other quarter during the year, driven principally by reduced volume and the mix of products sold in the first quarter. The seasonality of the Company’s sales volume combined with the accounting for fixed costs, such as depreciation, amortization, rent, personnel costs and interest expense, impacts the Company’s results on a quarterly basis. In addition, the Company tends to generate the majority of its operating cash flow in the third and fourth quarters of the year due to seasonal variations in operating results, the timing of annual performance-based compensation payments, customer program payments, working capital requirements and credit terms provided to customers. Accordingly, the Company’s results of operations for the three months ended March 31, 2020 may not necessarily be indicative of the results that may be expected for the year ending December 31, 2020.

Recent Accounting Pronouncements

Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of accounting standards updates (“ASUs”) to the FASB’s Accounting Standards Codification. The Company considers the applicability and impact of all ASUs.

In August 2018, the FASB issued ASU 2018-14, “Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20): Disclosure Framework-Changes to the Disclosure Requirements for Defined Benefit Plans.” ASU 2018-14 modifies disclosure requirements for defined benefit pension and other postretirement plans. ASU 2018-14 is effective for fiscal years ending after December 15, 2020. Since ASU 2018-14 only impacts the disclosure requirements related to defined benefit pension and other postretirement plans, the adoption of ASU 2018-14 will not have a material impact on the Company’s consolidated financial statements.

In December 2019, the FASB issued ASU 2019-12, "Simplifying the Accounting for Income Taxes" (Topic 740). ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. ASU 2019-12 is effective for years, and interim periods within those years, beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the potential effects of the adoption of ASU 2019-12.
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In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting." ASU 2020-04 provides optional expedients and exceptions to account for contracts, hedging relationships and other transactions that reference LIBOR or another reference rate if certain criteria are met. ASU 2020-04 is effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. The Company is currently evaluating the potential effects of the adoption of ASU 2020-04.

Adoption of New Accounting Guidance

The Company’s accounting policies are described in Note 1 of the Notes to Consolidated Financial Statements included in our 2019 Annual Report on Form 10-K. Such significant accounting policies are applicable for periods prior to the adoption of the following new accounting standards and updated accounting policies.

In June 2016, the FASB issued ASU 2016-13, “Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 involves several aspects of the accounting for credit losses related to certain financial instruments including assets measured at amortized cost, available-for-sale debt securities and certain off-balance sheet commitments. ASU 2016-13, and subsequent updates, broadens the information that an entity must consider in developing its estimated credit losses expected to occur over the remaining life of assets measured either collectively or individually to include historical experience, current conditions and reasonable and supportable forecasts, replacing the existing incurred credit loss model and other models with the Current Expected Credit Losses (“CECL”) model. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019. The Company adopted ASU 2016-13 on a modified retrospective basis effective January 1, 2020. The adoption of ASU 2016-03 did not have a material impact on the Company’s consolidated financial statements. The Company's reserves for doubtful accounts at March 31, 2020 and December 31, 2019 were $31 million and $29 million respectively.

In August 2018, the FASB issued ASU 2018-15, “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” ASU 2018-15 clarifies the accounting treatment for fees paid by a customer in a cloud computing arrangement (hosting arrangement) by providing guidance for determining when the arrangement includes a software license. ASU 2018-15 is effective for public business entities for years, and interim periods within those years, beginning after December 15, 2019. The Company adopted ASU 2018-15 prospectively to all implementation costs incurred after the date of adoption, or January 1, 2020. The adoption of ASU 2018-15 did not have a material impact on the Company’s consolidated financial statements.

Sales of Accounts Receivables

During the three months ended March 31, 2020, the Company amended its existing factoring agreement (the “Customer Receivables Purchase Agreement”) with a financial institution providing for an increase in the amount of certain customer receivables that may be sold. The Company has since increased receivables factored by $100 million under the amended Customer Receivables Purchase Agreement at March 31, 2020 from its previous position of factored receivables of approximately $200 million at December 31, 2019. Transactions under this agreement continue to be accounted for as sales of accounts receivable, and the receivables are removed from the Condensed Consolidated Balance Sheet at the time of the sales transaction. The Company classifies the proceeds received from the sales of accounts receivable as an operating cash flow in the unaudited Condensed Consolidated Statement of Cash Flows. The Company records the discount as other expense, net in the Condensed Consolidated Statement of Operations and collections of accounts receivables not yet submitted to the financial institution as a financing cash flow.

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Footnote 2 — Divestitures and Held for Sale

Discontinued Operations

The Company completed its previously announced ATP on December 31, 2019. As such, there were no businesses held for sale at March 31, 2020, nor income or loss from discontinued operations for the three months ended March 31, 2020. The following table provides a summary of amounts included in discontinued operations for the period indicated (in millions):
Three Months
Ended
March 31, 2019
Net sales$211  
Cost of products sold160  
Gross profit51  
Selling, general and administrative expenses25  
Impairment of goodwill, intangibles and other assets112  
Operating loss(86) 
Non-operating income, net(5) 
Loss before income taxes(81) 
Income tax benefit(4) 
Net loss$(77) 

2019 Divestiture Activity

On May 1, 2019, the Company sold its Rexair business to investment funds affiliated with Rhône Capital for approximately $235 million, subject to customary working capital and other post-closing adjustments.
On May 1, 2019, the Company sold its Process Solutions business to an affiliate of One Rock Capital Partners, LLC, for approximately $500 million, subject to customary working capital and other post-closing adjustments.

On December 31, 2019, the Company sold its U.S. Playing Cards business to Cartamundi Inc. and Cartamundi España S.L. for approximately $220 million, subject to customary working capital and other post-closing adjustments.
During the three months ended March 31, 2019, the Company recorded impairment charges totaling $112 million, which is included in the loss from discontinued operations, related to the write-down of the carrying value of the net assets of certain held for sale businesses based on their estimated fair value.

Footnote 3 — Accumulated Other Comprehensive Loss
The following tables display the changes in Accumulated Other Comprehensive Loss (“AOCL”) by component, net of tax, for the three months ended March 31, 2020 (in millions):
Cumulative
Translation
Adjustment
Pension and 
Postretirement
Costs
Derivative
Financial
Instruments
AOCL
Balance at December 31, 2019$(479) $(399) $(42) $(920) 
Other comprehensive income (loss) before reclassifications(156) (9) 25  (140) 
Amounts reclassified to earnings  4  1  5  
Net current period other comprehensive income (loss)(156) (5) 26  (135) 
Balance at March 31, 2020$(635) $(404) $(16) $(1,055) 

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For the three months ended March 31, 2020 and 2019, reclassifications from AOCL to the results of operations for the Company’s pension and postretirement benefit plans were a pretax expense of $6 million and $2 million, respectively, and primarily represent the amortization of net actuarial losses (see Footnote 11). These costs are recorded in other expense, net. For the three months ended March 31, 2020 and 2019, reclassifications from AOCL to the results of operations for the Company’s derivative financial instruments for effective cash flow hedges were pretax expense of $1 million and income of $4 million, respectively (see Footnote 10).

The income tax (expense) benefit allocated to the components of AOCL for the periods indicated are as follows (in millions):

Three Months Ended
March 31,
20202019
Foreign currency translation adjustments$(7) $  
Unrecognized pension and postretirement costs3  4  
Derivative financial instruments(9) 2  
Income tax (expense) benefit related to AOCL$(13) $6  

Footnote 4 — Restructuring Costs
Restructuring provisions were determined based on estimates prepared at the time the restructuring actions were approved by management and are periodically updated for changes. Restructuring amounts also include amounts recognized as incurred.
Accelerated Transformation Plan
The Company’s ATP, which was initiated during the first quarter of 2018 and completed at the end of 2019, was designed in part, to divest the Company’s non-core consumer businesses and focus on the realignment of the Company’s management structure and overall cost structure as a result of the completed divestitures. Restructuring costs associated with the ATP included employee-related costs, including severance, retirement and other termination benefits, as well as contract termination costs and other costs.
Restructuring costs, net incurred by reportable business segments for all restructuring activities in continuing operations for the periods indicated are as follows (in millions):
Three Months Ended
March 31,
20202019
Food and Commercial$  $1  
Home and Outdoor Living1  3  
Learning and Development1  4  
Corporate  3  
$2  $11  

Accrued restructuring costs activity for the three months ended March 31, 2020 are as follows (in millions):
Balance at December 31, 2019Restructuring
Costs, Net
PaymentsBalance at
March 31, 2020
Employee severance and termination benefits$10  $1  $(4) $7  
Exited contractual commitments and other
12  1  (5) 8  
$22  $2  $(9) $15  
Other Restructuring-Related Costs
The Company regularly incurs other restructuring-related costs in connection with various discrete initiatives which are recorded in cost of products sold and selling, general and administrative expense (“SG&A”) in the Condensed Consolidated Statements of Operations based on the nature of the underlying costs incurred.
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Footnote 5 — Inventories
Inventories are comprised of the following at the dates indicated (in millions):
March 31, 2020December 31, 2019
Raw materials and supplies$254  $231  
Work-in-process153  135  
Finished products1,293  1,240  
$1,700  $1,606  

Footnote 6 — Property, Plant and Equipment, Net
Property, plant and equipment, net, is comprised of the following at the dates indicated (in millions):
March 31, 2020December 31, 2019
Land$82  $86  
Buildings and improvements633  641  
Machinery and equipment2,146  2,151  
2,861  2,878  
Less: Accumulated depreciation(1,738) (1,723) 
$1,123  $1,155  

Depreciation expense for continuing operations was $48 million and $40 million for the three months ended March 31, 2020 and 2019, respectively. Depreciation expense for discontinued operations was nil for 2019 as the Company ceased depreciating property, plant and equipment relating to businesses which satisfied the criteria to be classified as held for sale.

During the first quarter of 2020, the Company concluded that a triggering event had occurred for all of its reporting units as a result of the COVID-19 pandemic. Pursuant to the authoritative accounting literature, the Company compared the sum of the undiscounted future cash flows attributable to the asset or group of assets (the lowest level for which identifiable cash flows are available) to their respective carrying amount. As a result of the impairment testing performed in connection with the triggering event, the Company recorded a non-cash fixed asset impairment charge of approximately $1 million during the three months ended March 31, 2020 in the Home and Outdoor Living segment associated with its Yankee Candle retail store business. See Footnote 1 for further information.

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Footnote 7 — Goodwill and Other Intangible Assets, Net

Goodwill activity for the three months ended March 31, 2020 is as follows (in millions):

March 31, 2020
SegmentsNet Book Value at December 31,
2019
Impairment Charges
Foreign
Exchange and Other
Gross
Carrying
Amount
Accumulated
Impairment
Charges
Net Book
Value
Appliances and Cookware$212  $(212) $  $744  $(744) $  
Food and Commercial747      2,266  (1,519) 747  
Home and Outdoor Living164      2,155  (1,991) 164  
Learning and Development2,586    (14) 3,418  (846)