Consolidating Guarantor Financial Information

12 Months Ended

Dec. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidating Guarantor Financial Information

Consolidating Guarantor Financial Information:

The 2014 Senior Notes issued by Albemarle Corporation (the “Issuer”) are fully and unconditionally guaranteed, jointly and severally, on an unsecured and unsubordinated basis by Albemarle Holdings Corporation and Albemarle Holdings II Corporation (the “Guarantor Subsidiaries”). The Guarantor Subsidiaries are 100% owned subsidiaries of the Issuer. The guarantees are general senior unsecured obligations of the Guarantor Subsidiaries and rank equally in right of payment with all existing and future senior unsecured indebtedness and other obligations of the Guarantor Subsidiaries that are not, by their terms, otherwise expressly subordinated. The note guarantees will be released when the 4.625% Senior Notes assumed by Albemarle upon the acquisition of Rockwood are repaid or otherwise discharged.

The Company applies the equity method of accounting to its subsidiaries. For cash management purposes, the Company transfers cash between Issuer, Guarantor Subsidiaries and all other non-guarantor subsidiaries (the “Non-Guarantor Subsidiaries”) through intercompany financing arrangements, contributions or declaration of dividends between the respective parent and its subsidiaries. The transfer of cash under these activities facilitates the ability of the recipient to make specified third-party payments for principal and interest on the Company’s outstanding debt, common stock dividends and common stock repurchases. The consolidating statements of cash flows for the years ended December 31, 2014, 2013 and 2012 present such intercompany financing activities, contributions and dividends consistent with how such activity would be presented in a stand-alone statement of cash flows. There are no significant restrictions on the ability of the Issuer or the Guarantor Subsidiaries to obtain funds from subsidiaries by dividend or loan.

The following consolidating financial information presents the financial condition, results of operations and cash flows of the Issuer, Guarantor Subsidiaries, and the Non-Guarantor Subsidiaries, together with consolidating adjustments necessary to present Albemarle’s results on a consolidated basis, and should be read in conjunction with the notes to the consolidated financial statements. Each entity in the consolidating financial information follows the same accounting policies as described in the notes to the consolidated financial statements.

Consolidating Balance Sheet

December 31, 2014

(In Thousands)	Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Assets
Current assets:
Cash and cash equivalents	$	1,930,802		$	—	$	558,966		$	—		$	2,489,768
Trade accounts receivable, less allowance for doubtful accounts	91,849			—		293,363			—			385,212
Other accounts receivable	19,033			—		30,390			—			49,423
Intergroup receivable	74,102			—		18,097			(92,199		)	—
Inventories	201,006			—		171,543			(14,188		)	358,361
Other current assets	45,901			—		25,111			(4,926		)	66,086
Total current assets	2,362,693			—		1,097,470			(111,313		)	3,348,850
Property, plant and equipment, at cost	1,726,690			—		893,980			—			2,620,670
Less accumulated depreciation and amortization	1,047,372			—		341,430			—			1,388,802
Net property, plant and equipment	679,318			—		552,550			—			1,231,868
Investments	73,500			—		120,542			—			194,042
Investment in subsidiaries	1,551,071			—		—			(1,551,071		)	—
Other assets	35,837			—		125,119			—			160,956
Goodwill	49,212			—		194,050			—			243,262
Other intangibles, net of amortization	20,834			—		23,291			—			44,125
Total assets	$	4,772,465		$	—	$	2,113,022		$	(1,662,384	)	$	5,223,103
Liabilities and Equity
Current liabilities:
Accounts payable	$	122,479		$	—	$	109,226		$	—		$	231,705
Intergroup payable	18,097			—		74,102			(92,199		)	—
Accrued expenses	84,619			—		81,555			—			166,174
Current portion of long-term debt	692,280			—		18,816			—			711,096
Dividends payable	21,458			—		—			—			21,458
Income taxes payable	1,396			—		7,944			113			9,453
Total current liabilities	940,329			—		291,643			(92,086		)	1,139,886
Long-term debt	2,214,755			—		8,280			—			2,223,035
Postretirement benefits	56,424			—		—			—			56,424
Pension benefits	128,238			—		42,296			—			170,534
Other noncurrent liabilities	51,936			—		35,769			—			87,705
Deferred income taxes	21,318			—		35,566			—			56,884
Commitments and contingencies
Equity:
Albemarle Corporation shareholders’ equity:
Common stock	780			—		6,808			(6,808		)	780
Additional paid-in capital	10,447			—		553,172			(553,172		)	10,447
Accumulated other comprehensive loss	(62,413		)	—		(51,073		)	51,073			(62,413		)
Retained earnings	1,410,651			—		1,061,391			(1,061,391		)	1,410,651
Total Albemarle Corporation shareholders’ equity	1,359,465			—		1,570,298			(1,570,298		)	1,359,465
Noncontrolling interests	—			—		129,170			—			129,170
Total equity	1,359,465			—		1,699,468			(1,570,298		)	1,488,635
Total liabilities and equity	$	4,772,465		$	—	$	2,113,022		$	(1,662,384	)	$	5,223,103

Condensed Consolidating Balance Sheet

December 31, 2013

(In Thousands)	Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated Total
Assets
Current assets:
Cash and cash equivalents	$	88,476	$	—	$	388,763	$	—		$	477,239
Trade accounts receivable, less allowance for doubtful accounts	149,834		—		297,030		—			446,864
Other accounts receivable	11,812		—		33,282		—			45,094
Intergroup receivable	88,090		—		28,433		(116,523		)	—
Inventories	219,390		—		234,975		(18,316		)	436,049
Other current assets	52,457		—		28,979		(3,767		)	77,669
Total current assets	610,059		—		1,011,462		(138,606		)	1,482,915
Property, plant and equipment, at cost	1,999,398		—		972,686		—			2,972,084
Less accumulated depreciation and amortization	1,268,205		—		346,810		—			1,615,015
Net property, plant and equipment	731,193		—		625,876		—			1,357,069
Investments	69,616		—		142,562		—			212,178
Investment in subsidiaries	1,611,662		—		—		(1,611,662		)	—
Other assets	18,621		—		141,608		—			160,229
Goodwill	49,212		—		234,991		—			284,203
Other intangibles, net of amortization	35,003		—		53,200		—			88,203
Total assets	$	3,125,366	$	—	$	2,209,699	$	(1,750,268	)	$	3,584,797
Liabilities and Equity
Current liabilities:
Accounts payable	$	107,781	$	—	$	100,400	$	—		$	208,181
Intergroup payable	28,433		—		88,090		(116,523		)	—
Accrued expenses	92,273		—		84,143					176,416
Current portion of long-term debt	99		—		24,455		—			24,554
Dividends payable	19,197		—		—		—			19,197
Income taxes payable	2,364		—		5,651		—			8,015
Total current liabilities	250,147		—		302,739		(116,523		)	436,363
Long-term debt	1,035,977		—		18,333		—			1,054,310
Postretirement benefits	53,903		—		—		—			53,903
Pension benefits	20,931		—		36,716		—			57,647
Other noncurrent liabilities	61,095		—		49,515		—			110,610
Deferred income taxes	75,952		—		53,236		—			129,188
Commitments and contingencies
Equity:
Albemarle Corporation shareholders’ equity:
Common stock	801		—		6,807		(6,807		)	801
Additional paid-in capital	9,957		—		549,265		(549,265		)	9,957
Accumulated other comprehensive income	116,245		—		111,038		(111,038		)	116,245
Retained earnings	1,500,358		—		966,635		(966,635		)	1,500,358
Total Albemarle Corporation shareholders’ equity	1,627,361		—		1,633,745		(1,633,745		)	1,627,361
Noncontrolling interests	—		—		115,415		—			115,415
Total equity	1,627,361		—		1,749,160		(1,633,745		)	1,742,776
Total liabilities and equity	$	3,125,366	$	—	$	2,209,699	$	(1,750,268	)	$	3,584,797

Consolidating Statement of Income

Year Ended December 31, 2014

(In Thousands)	Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Net sales	$	1,565,965		$	—	$	1,565,241		$	(685,658	)	$	2,445,548
Cost of goods sold	1,095,072			—		1,269,415			(689,787		)	1,674,700
Gross profit	470,893			—		295,826			4,129			770,848
Selling, general and administrative expenses	252,098			—		103,037			—			355,135
Research and development expenses	55,856			—		32,454			—			88,310
Restructuring and other charges, net	9,871			—		16,076			—			25,947
Acquisition and integration related costs	30,158			—		—			—			30,158
Intercompany service fee	26,123			—		(26,123		)	—			—
Operating profit	96,787			—		170,382			4,129			271,298
Interest and financing expenses	(41,361		)	—		3			—			(41,358		)
Other expenses, net	(10,534		)	—		(6,227		)	—			(16,761		)
Income from continuing operations before income taxes and equity in net income of unconsolidated investments	44,892			—		164,158			4,129			213,179
Income tax expense	5,464			—		11,513			1,507			18,484
Income from continuing operations before equity in net income of unconsolidated investments	39,428			—		152,645			2,622			194,695
Equity in net income of unconsolidated investments (net of tax)	6,956			—		28,786			—			35,742
Net income from continuing operations	46,384			—		181,431			2,622			230,437
Loss from discontinued operations (net of tax)	(19,373		)	—		(50,158		)	—			(69,531		)
Equity in undistributed earnings of subsidiaries	106,305			—		—			(106,305		)	—
Net income	133,316			—		131,273			(103,683		)	160,906
Net income attributable to noncontrolling interests	—			—		(27,590		)	—			(27,590		)
Net income attributable to Albemarle Corporation	$	133,316		$	—	$	103,683		$	(103,683	)	$	133,316

Condensed Consolidating Statement of Comprehensive Loss

Year Ended December 31, 2014

(In Thousands)	Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Net income	$	133,316		$	—	$	131,273		$	(103,683	)	$	160,906
Total other comprehensive loss, net of tax	(178,658		)	—		(163,199		)	163,119			(178,738		)
Comprehensive loss	(45,342		)	—		(31,926		)	59,436			(17,832		)
Comprehensive income attributable to noncontrolling interests	—			—		(27,510		)	—			(27,510		)
Comprehensive loss attributable to Albemarle Corporation	$	(45,342	)	$	—	$	(59,436	)	$	59,436		$	(45,342	)

Condensed Consolidating Statement of Income

Year Ended December 31, 2013

(In Thousands)	Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Net sales	$	1,563,483		$	—	$	1,437,664		$	(606,877	)	$	2,394,270
Cost of goods sold	1,025,989			—		1,131,158			(613,348		)	1,543,799
Gross profit	537,494			—		306,506			6,471			850,471
Selling, general and administrative expenses	60,818			—		97,371			—			158,189
Research and development expenses	51,794			—		30,452			—			82,246
Restructuring and other charges, net	23,880			—		9,481			—			33,361
Intercompany service fee	18,038			—		(18,038		)	—			—
Operating profit	382,964			—		187,240			6,471			576,675
Interest and financing expenses	(33,537		)	—		1,978			—			(31,559		)
Intergroup interest and financing expenses	(87		)	—		87			—			—
Other (expenses) income, net	(9,281		)	—		2,607			—			(6,674		)
Income from continuing operations before income taxes and equity in net income of unconsolidated investments	340,059			—		191,912			6,471			538,442
Income tax expense	128,645			—		3,436			2,364			134,445
Income from continuing operations before equity in net income of unconsolidated investments	211,414			—		188,476			4,107			403,997
Equity in net income of unconsolidated investments (net of tax)	6,940			—		24,789			—			31,729
Net income from continuing operations	218,354			—		213,265			4,107			435,726
Income (loss) from discontinued operations (net of tax)	6,906			—		(2,798		)	—			4,108
Equity in undistributed earnings of subsidiaries	187,911			—		—			(187,911		)	—
Net income	413,171			—		210,467			(183,804		)	439,834
Net income attributable to noncontrolling interests	—			—		(26,663		)	—			(26,663		)
Net income attributable to Albemarle Corporation	$	413,171		$	—	$	183,804		$	(183,804	)	$	413,171

Condensed Consolidating Statement of Comprehensive Income (Loss)

Year Ended December 31, 2013

(In Thousands)	Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Net income	$	413,171	$	—	$	210,467		$	(183,804	)	$	439,834
Total other comprehensive income (loss), net of tax	30,981		—		(264,363		)	264,719			31,337
Comprehensive income (loss)	444,152		—		(53,896		)	80,915			471,171
Comprehensive income attributable to noncontrolling interests	—		—		(27,019		)	—			(27,019		)
Comprehensive income (loss) attributable to Albemarle Corporation	$	444,152	$	—	$	(80,915	)	$	80,915		$	444,152

Condensed Consolidating Statement of Income

Year Ended December 31, 2012

(In Thousands)	Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Net sales	$	1,726,884		$	—	$	1,560,043		$	(767,773	)	$	2,519,154
Cost of goods sold	1,093,330			—		1,297,875			(770,894		)	1,620,311
Gross profit	633,554			—		262,168			3,121			898,843
Selling, general and administrative expenses	204,029			—		104,427			—			308,456
Research and development expenses	47,763			—		31,156			—			78,919
Restructuring and other charges, net	12,711			—		98,974			—			111,685
Intercompany service fee	26,132			—		(26,132		)	—			—
Operating profit	342,919			—		53,743			3,121			399,783
Interest and financing expenses	(33,193		)	—		393			—			(32,800		)
Other (expenses) income, net	(2,731		)	—		3,960			—			1,229
Income from continuing operations before income taxes and equity in net income of unconsolidated investments	306,995			—		58,096			3,121			368,212
Income tax expense (benefit)	80,444			—		(1,150		)	1,139			80,433
Income from continuing operations before equity in net income of unconsolidated investments	226,551			—		59,246			1,982			287,779
Equity in net income of unconsolidated investments (net of tax)	8,863			—		29,204			—			38,067
Net income from continuing operations	235,414			—		88,450			1,982			325,846
Income (loss) from discontinued operations (net of tax)	8,987			—		(4,706		)	—			4,281
Equity in undistributed earnings of subsidiaries	67,135			—		—			(67,135		)	—
Net income	311,536			—		83,744			(65,153		)	330,127
Net income attributable to noncontrolling interests	—			—		(18,591		)	—			(18,591		)
Net income attributable to Albemarle Corporation	$	311,536		$	—	$	65,153		$	(65,153	)	$	311,536

Condensed Consolidating Statement of Comprehensive Income

Year Ended December 31, 2012

(In Thousands)	Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Net income	$	311,536	$	—	$	83,744		$	(65,153	)	$	330,127
Total other comprehensive income, net of tax	24,935		—		44,721			(44,824		)	24,832
Comprehensive income	336,471		—		128,465			(109,977		)	354,959
Comprehensive income attributable to noncontrolling interests	—		—		(18,488		)	—			(18,488		)
Comprehensive income attributable to Albemarle Corporation	$	336,471	$	—	$	109,977		$	(109,977	)	$	336,471

Consolidating Statement Of Cash Flows

Year Ended December 31, 2014

(In Thousands)	Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Cash and cash equivalents at beginning of year	$	88,476		$	—	$	388,763		$	—		$	477,239
Cash flows from operating activities:
Net cash provided by operating activities	227,426			—		273,176			(7,993		)	492,609
Cash flows from investing activities:
Capital expenditures	(81,624		)	—		(28,952		)	—			(110,576		)
Cash proceeds from divestitures, net	97,523			—		7,195			—			104,718
Payment for settlement of interest rate swap	(33,425		)	—		—			—			(33,425		)
Sales of (investments in) marketable securities, net	668			—		(19		)	—			649
Long-term advances to joint ventures	—			—		(7,499		)	—			(7,499		)
Net cash used in investing activities	(16,858		)	—		(29,275		)	—			(46,133		)
Cash flows from financing activities:
Proceeds from issuance of senior notes	1,888,197			—		—			—			1,888,197
Repayments of long-term debt	(108		)	—		(5,909		)	—			(6,017		)
Other borrowings (repayments), net	4,178			—		(10,003		)	—			(5,825		)
Dividends paid to shareholders	(84,102		)	—		—			—			(84,102		)
Dividends paid to noncontrolling interests	—			—		(15,535		)	—			(15,535		)
Intercompany dividends paid	—			—		(7,993		)	7,993			—
Repurchases of common stock	(150,000		)	—		—			—			(150,000		)
Proceeds from exercise of stock options	2,713			—		—			—			2,713
Excess tax benefits realized from stock-based compensation arrangements	826			—		—			—			826
Withholding taxes paid on stock-based compensation award distributions	(3,284		)	—		—			—			(3,284		)
Debt financing costs	(17,644		)	—		—			—			(17,644		)
Net cash provided by (used in) financing activities	1,640,776			—		(39,440		)	7,993			1,609,329
Net effect of foreign exchange on cash and cash equivalents	(9,018		)	—		(34,258		)	—			(43,276		)
Increase in cash and cash equivalents	1,842,326			—		170,203			—			2,012,529
Cash and cash equivalents at end of year	$	1,930,802		$	—	$	558,966		$	—		$	2,489,768

Condensed Consolidating Statement Of Cash Flows

Year Ended December 31, 2013

(In Thousands)	Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Cash and cash equivalents at beginning of year	$	145,999		$	—	$	331,697		$	—		$	477,696
Cash flows from operating activities:
Net cash provided by operating activities	270,179			—		177,806			(15,126		)	432,859
Cash flows from investing activities:
Capital expenditures	(79,441		)	—		(75,905		)	—			(155,346		)
Cash payments related to acquisitions and other	(250		)	—		(2,315		)	—			(2,565		)
Sales of (investments in) marketable securities, net	186			—		(17		)	—			169
Proceeds from intercompany investing related activity	47,393			—		43,850			(91,243		)	—
Intercompany investing related payments	—			—		(43,850		)	43,850			—
Net cash used in investing activities	(32,112		)	—		(78,237		)	(47,393		)	(157,742		)
Cash flows from financing activities:
Repayments of long-term debt	(117,097		)	—		(18,636		)	—			(135,733		)
Proceeds from borrowings of long-term debt	117,000			—		—			—			117,000
Other borrowings, net	363,000			—		35,544			—			398,544
Dividends paid to shareholders	(78,107		)	—		—			—			(78,107		)
Dividends paid to noncontrolling interests	—			—		(10,014		)	—			(10,014		)
Intercompany dividends paid	—			—		(15,126		)	15,126			—
Repurchases of common stock	(582,298		)	—		—			—			(582,298		)
Proceeds from exercise of stock options	5,553			—		—			—			5,553
Excess tax benefits realized from stock-based compensation arrangements	3,266			—		—			—			3,266
Withholding taxes paid on stock-based compensation award distributions	(6,149		)	—		—			—			(6,149		)
Debt financing costs	(108		)	—		—			—			(108		)
Proceeds from intercompany financing related activity	43,850			—		—			(43,850		)	—
Intercompany financing related payments	(43,850		)	—		(47,393		)	91,243			—
Net cash used in financing activities	(294,940		)	—		(55,625		)	62,519			(288,046		)
Net effect of foreign exchange on cash and cash equivalents	(650		)	—		13,122			—			12,472
(Decrease) increase in cash and cash equivalents	(57,523		)	—		57,066			—			(457		)
Cash and cash equivalents at end of year	$	88,476		$	—	$	388,763		$	—		$	477,239

Condensed Consolidating Statement Of Cash Flows

Year Ended December 31, 2012

(In Thousands)	Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Cash and cash equivalents at beginning of year	$	47,018		$	—	$	422,398		$	—		$	469,416
Cash flows from operating activities:
Net cash provided by operating activities	342,173			—		189,511			(42,918		)	488,766
Cash flows from investing activities:
Capital expenditures	(136,299		)	—		(144,574		)	—			(280,873		)
Cash payments related to acquisitions and other	(3,072		)	—		(288		)	—			(3,360		)
Cash proceeds from divestitures, net	—			—		9,646			—			9,646
Investments in marketable securities, net	(1,607		)	—		(8		)	—			(1,615		)
Long-term advances to joint ventures	(2,459		)	—		(22,500		)	—			(24,959		)
Proceeds from intercompany investing related activity	39,851			—		—			(39,851		)	—
Intercompany investing related payments	(33,809		)	—		—			33,809			—
Net cash used in investing activities	(137,395		)	—		(157,724		)	(6,042		)	(301,161		)
Cash flows from financing activities:
Repayments of long-term debt	(86		)	—		(14,304		)	—			(14,390		)
Other borrowings (repayments), net	144			—		(49,565		)	—			(49,421		)
Dividends paid to shareholders	(69,113		)	—		—			—			(69,113		)
Dividends paid to noncontrolling interests	—			—		(7,628		)	—			(7,628		)
Intercompany dividends paid	—			—		(42,918		)	42,918			—
Repurchases of common stock	(63,575		)	—		—			—			(63,575		)
Proceeds from exercise of stock options	21,148			—		—			—			21,148
Excess tax benefits realized from stock-based compensation arrangements	14,809			—		—			—			14,809
Withholding taxes paid on stock-based compensation award distributions	(9,124		)	—		—			—			(9,124		)
Proceeds from intercompany financing related activity	—			—		33,809			(33,809		)	—
Intercompany financing related payments	—			—		(39,851		)	39,851			—
Net cash used in financing activities	(105,797		)	—		(120,457		)	48,960			(177,294		)
Net effect of foreign exchange on cash and cash equivalents	—			—		(2,031		)	—			(2,031		)
Increase (decrease) in cash and cash equivalents	98,981			—		(90,701		)	—			8,280
Cash and cash equivalents at end of year	$	145,999		$	—	$	331,697		$	—		$	477,696