Company expects to close transaction with
Apollo Funds in mid-November, 2022
SKOKIE,
Ill., Oct. 31, 2022 /PRNewswire/ -- Tenneco Inc.
(NYSE: TEN) today announced results for the third quarter ended
September 30, 2022, including the
following:
- Third quarter total revenue of $4.9
billion, up 14% year-over-year. Value-add revenue of
$3.6 billion was up 17%
year-over-year, excluding a negative currency impact of
$214 million. The Company's OE
light vehicle value-add revenue growth of 32%, excluding currency,
outpaced global industry light vehicle production*, which was up
27% year-over-year. Material, energy, and freight cost recoveries
contributed more than $200 million of
revenue on a year-over-year basis.
- EBIT** of $129 million, compared
with EBIT of $125 million in third
quarter 2021. Adjusted EBITDA*** improved 8% year-over-year to
$301 million, compared with
$279 million last year. The increase
in earnings is primarily a result of higher light vehicle
volumes.
- Net loss of $44 million, or a
loss of $0.53 per diluted share,
compared to net earnings of $15
million, or $0.17 per diluted
share, in the prior year. Third quarter 2022 adjusted net loss of
$11 million, or a loss of
$0.14 per diluted share, compared to
prior year adjusted net income of $15
million, or $0.17 per diluted
share. The year-over-year comparisons were primarily driven
by higher non-operating interest and tax expenses.
"In a tough business environment, I'm proud of how Team Tenneco
delivered year-over-year growth in revenue and adjusted EBITDA"
said Brian Kesseler, Tenneco CEO.
"Our continued focus on operational excellence, cash generation,
and cost control actions also helped us deliver both significant
sequential margin improvement across all business groups, and lower
net debt."
As previously disclosed, all conditions to closing with respect
to antitrust and/or foreign direct investment laws under Tenneco's
merger agreement with certain affiliates of Apollo Global
Management, Inc. have been satisfied or waived in accordance with
the terms and conditions of the merger agreement. The Company
expects to complete the transaction in mid-November 2022. In light of this,
Tenneco will not conduct a conference call or give forward-looking
guidance.
|
*
|
Source: S&P Global
Mobility (formerly IHS Markit) October 2022 global light vehicle
production forecast.
|
|
**
|
EBIT: Earnings before
interest expense, income taxes and noncontrolling
interests.
|
|
***
|
Adjusted EBITDA:
Adjusted earnings before interest expense, income taxes,
noncontrolling interests, and depreciation and
amortization.
|
Attachment 1
Statements of Income (Loss) – 3
months
Statements of Income (Loss) – 9 months
Balance Sheets
Statements of Cash Flows – 3 Months
Statements of Cash Flows – 9 Months
Attachment 2
Reconciliation of GAAP to Non-GAAP
Earnings Measures – 3 and 9 Months
Reconciliation of GAAP Revenue and Earnings to Non-GAAP Revenue and
Earnings Measures – 3 and 9 Months
Reconciliation of GAAP to Non-GAAP Revenue Measures – 3 and 9
Months
Reconciliation of Non-GAAP Measures – Debt Net of Total
Cash/Adjusted LTM EBITDA including noncontrolling
interests
Reconciliation of GAAP to Non-GAAP Revenue Measures – Original
Equipment, Original Equipment Service and Aftermarket Revenue – 3
and 9 Months
Reconciliation of GAAP to Non-GAAP Cash Flow Measures – 3 and 9
Months
About Tenneco
Tenneco is one of the world's leading
designers, manufacturers, and marketers of automotive products for
original equipment and aftermarket customers, with full year 2021
revenues of $18 billion and approximately 71,000 team
members working at more than 260 sites worldwide. Through our
four business groups, Motorparts, Performance Solutions, Clean Air
and Powertrain, Tenneco is driving advancements in global mobility
by delivering technology solutions for diversified global markets,
including light vehicle, commercial truck, off-highway, industrial,
motorsport and the aftermarket.
Visit www.tenneco.com to learn more.
Investors and others should note that Tenneco routinely posts
important information on its website and considers the Investor
section, www.investors.tenneco.com, a channel of
distribution.
Safe Harbor
This press release includes forward-looking statements
regarding the Agreement and Plan of Merger (the "Merger Agreement")
that the Company entered into with Pegasus Holdings III, LLC (the
"Parent") and Pegasus Merger Co. on February
22, 2022. Pursuant to the terms and conditions set forth in
the Merger Agreement, Merger Sub will merge with and into Tenneco
(the "Merger") with Tenneco continuing as the surviving corporation
of the Merger and as a wholly owned subsidiary of Parent. Important
factors that could cause actual results to differ materially from
the expectations reflected in the forward-looking statements
include (without limitation and in addition to the risks set forth
above): the inability to consummate the Merger within the
anticipated time period, or at all, due to any reason, including
the failure to satisfy conditions to the consummation of the
Merger; the risk that the Merger disrupts our current plans and
operations or diverts management's attention from its ongoing
business; the effect of the announcement of the Merger on our
ability to retain and hire key personnel and maintain relationships
with our customers, suppliers and others with whom we do business;
the effect of the announcement of the Merger on our operating
results and business generally; the amount of costs, fees and
expenses related to the Merger; the risk that our stock price may
decline significantly if the Merger is not consummated; the nature,
cost and outcome of any litigation and other legal proceedings,
including any such proceedings related to the Merger and instituted
against Tenneco and others; and other risks to consummation of the
proposed Merger, including the risk that the proposed Merger will
not be consummated within the expected time period or at
all.
If the proposed transaction is consummated, the Company's
stockholders will cease to have any equity interest in the Company
and will have no right to participate in its earnings and future
growth. The risks included here are not exhaustive. These and
other factors are identified and described in more detail in the
Company's Annual Report on Form 10-K for the year ended
December 31, 2021, and
quarterly reports on Form 10-Q for the quarters ended March 31, 2022 and June
30, 2022, as well as the Company's subsequent filings and
quarterly reports, available online at www.sec.gov. Readers are
cautioned not to place undue reliance on the Company's projections
and other forward-looking statements, which speak only as of the
date thereof. Except as required by applicable law, the Company
undertakes no obligation to update any forward-looking statement,
or to make any other forward-looking statements, whether as a
result of new information, future events or otherwise.
Investor inquiries:
Linae Golla
847-482-5162
lgolla@tenneco.com
Rich Kwas
248-849-1340
rich.kwas@tenneco.com
Media inquiries:
Bill Dawson
847-482-5807
bdawson@tenneco.com
|
ATTACHMENT 1
|
|
TENNECO
INC.
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
|
|
Unaudited
|
|
(millions, except per
share amounts)
|
|
Three Months Ended
September 30,
|
|
2022
|
|
2021
|
|
Net sales and operating
revenues:
|
|
|
|
|
Motorparts
|
$
723
|
|
$
769
|
|
Performance
Solutions
|
849
|
|
686
|
|
Clean Air - Value-add
revenues
|
1,040
|
|
897
|
|
Clean Air - Substrate
sales
|
1,295
|
|
1,039
|
|
Powertrain
|
1,024
|
|
941
|
|
Total net sales and operating revenues
|
4,931
|
|
4,332
|
|
Costs and
expenses:
|
|
|
|
|
Cost of
sales (exclusive of depreciation and amortization)
|
4,388
|
|
3,776
|
|
Selling,
general, and administrative
|
219
|
|
240
|
|
Depreciation and amortization
|
140
|
|
147
|
|
Engineering, research, and development
|
71
|
|
71
|
|
Restructuring charges, net and asset impairments
|
3
|
|
(4)
|
|
Total costs and expenses
|
4,821
|
|
4,230
|
|
Other income
(expense):
|
|
|
|
|
Non-service pension
and postretirement benefit (costs) credits
|
3
|
|
4
|
|
Equity in earnings
(losses) of nonconsolidated affiliates, net of tax
|
3
|
|
10
|
|
Other income
(expense), net
|
13
|
|
9
|
|
19
|
|
23
|
|
Earnings (loss) before
interest expense, income taxes, and noncontrolling
interests
|
129
|
|
125
|
|
Interest
expense
|
(90)
|
|
(66)
|
|
Earnings (loss) before
income taxes and noncontrolling interests
|
39
|
|
59
|
|
Income tax (expense)
benefit
|
(67)
|
|
(34)
|
|
Net income
(loss)
|
(28)
|
|
25
|
|
Less: Net income
(loss) attributable to noncontrolling interests
|
16
|
|
10
|
|
Net income (loss)
attributable to Tenneco Inc.
|
$
(44)
|
|
$
15
|
|
|
|
|
|
Basic earnings (loss)
per share:
|
|
|
|
|
Earnings (loss) per
share
|
$
(0.53)
|
|
$
0.17
|
|
Weighted average
shares outstanding
|
83.7
|
|
82.3
|
|
Diluted earnings (loss)
per share:
|
|
|
|
|
Earnings (loss) per
share
|
$
(0.53)
|
|
$
0.17
|
|
Weighted average
shares outstanding
|
83.7
|
|
84.1
|
|
ATTACHMENT 1
|
|
TENNECO
INC.
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
|
|
Unaudited
|
|
(millions, except per
share amounts)
|
|
Nine Months Ended
September 30,
|
|
2022
|
|
2021
|
|
Net sales and operating
revenues:
|
|
|
|
|
Motorparts
|
$
2,174
|
|
$
2,282
|
|
Performance
Solutions
|
2,433
|
|
2,188
|
|
Clean Air - Value-add
revenues
|
3,058
|
|
2,876
|
|
Clean Air - Substrate
sales
|
3,517
|
|
3,208
|
|
Powertrain
|
3,063
|
|
3,092
|
|
Total net sales and operating revenues
|
14,245
|
|
13,646
|
|
Costs and
expenses:
|
|
|
|
|
Cost of sales
(exclusive of depreciation and amortization)
|
12,663
|
|
11,810
|
|
Selling, general, and
administrative
|
728
|
|
764
|
|
Depreciation and
amortization
|
429
|
|
447
|
|
Engineering, research,
and development
|
220
|
|
216
|
|
Restructuring charges,
net and asset impairments
|
45
|
|
48
|
|
Total costs and expenses
|
14,085
|
|
13,285
|
|
Other income
(expense):
|
|
|
|
|
Non-service pension
and postretirement benefit (costs) credits
|
9
|
|
10
|
|
Equity in earnings
(losses) of nonconsolidated affiliates, net of tax
|
25
|
|
47
|
|
Gain (loss) on
extinguishment of debt
|
—
|
|
8
|
|
Other income
(expense), net
|
27
|
|
30
|
|
61
|
|
95
|
|
Earnings (loss) before
interest expense, income taxes, and noncontrolling
interests
|
221
|
|
456
|
|
Interest
expense
|
(232)
|
|
(205)
|
|
Earnings (loss) before
income taxes and noncontrolling interests
|
(11)
|
|
251
|
|
Income tax (expense)
benefit
|
(140)
|
|
(122)
|
|
Net income
(loss)
|
(151)
|
|
129
|
|
Less: Net income
(loss) attributable to noncontrolling interests
|
52
|
|
59
|
|
Net income (loss)
attributable to Tenneco Inc.
|
$
(203)
|
|
$
70
|
|
|
|
|
|
Basic earnings (loss)
per share:
|
|
|
|
|
Earnings (loss) per
share
|
$
(2.44)
|
|
$
0.85
|
|
Weighted average
shares outstanding
|
83.5
|
|
82.2
|
|
Diluted earnings (loss)
per share:
|
|
|
|
|
Earnings (loss) per
share
|
$
(2.44)
|
|
$
0.83
|
|
Weighted average
shares outstanding
|
83.5
|
|
83.5
|
|
ATTACHMENT 1
|
|
TENNECO
INC.
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
Unaudited
|
|
(dollars in
millions)
|
|
September 30,
2022
|
|
December 31,
2021
|
|
|
Assets
|
|
|
|
|
|
Cash and cash
equivalents
|
$
415
|
|
$
859
|
|
|
Restricted
cash
|
8
|
|
6
|
|
|
Receivables,
net
|
2,819
|
(a)
|
2,419
|
(a)
|
|
Inventories
|
1,948
|
|
1,846
|
|
|
Prepayments and other
current assets
|
553
|
|
683
|
|
|
Property, plant, and
equipment, net
|
2,557
|
|
2,872
|
|
|
Other noncurrent
assets
|
2,652
|
|
2,937
|
|
|
Total
assets
|
$
10,952
|
|
$
11,622
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
Short-term debt,
including current maturities of long-term debt
|
$
1,427
|
|
$
57
|
|
|
Accounts
payable
|
3,288
|
|
2,955
|
|
|
Accrued compensation
and employee benefits
|
364
|
|
381
|
|
|
Accrued income
taxes
|
70
|
|
71
|
|
|
Accrued expenses and
other current liabilities
|
1,153
|
|
1,227
|
|
|
Long-term
debt
|
3,603
|
(b)
|
5,018
|
(b)
|
|
Deferred income
taxes
|
96
|
|
105
|
|
|
Pension and
postretirement benefits
|
723
|
|
830
|
|
|
Deferred credits and
other liabilities
|
436
|
|
491
|
|
|
Redeemable
noncontrolling interests
|
37
|
|
91
|
|
|
Total Tenneco Inc.
shareholders' equity (deficit)
|
(519)
|
|
85
|
|
|
Noncontrolling
interests
|
274
|
|
311
|
|
|
Total liabilities,
redeemable noncontrolling interests, and equity
|
$
10,952
|
|
$
11,622
|
|
|
September 30,
2022
|
|
December 31,
2021
|
|
|
(a) Accounts
receivable net of:
|
|
|
|
|
|
Accounts receivable
outstanding and derecognized
|
$
1,063
|
|
$
1,043
|
|
|
|
|
|
|
|
(b) Long-term debt
composed of:
|
|
|
|
|
|
Revolver
Borrowings
|
$
39
|
|
$
—
|
|
|
LIBOR plus 2.00% Term
Loan A due 2019 through 2023(1)
|
1,271
|
|
1,396
|
|
|
LIBOR plus 3.00% Term
Loan B due 2019 through 2025
|
1,602
|
|
1,606
|
|
|
$225 million of 5.375%
Senior Notes due 2024
|
224
|
|
223
|
|
|
$500 million of 5.000%
Senior Notes due 2026
|
496
|
|
496
|
|
|
$500 million of
7.875% Senior Secured Notes due 2029
|
491
|
|
490
|
|
|
$800 million of
5.125% Senior Secured Notes due 2029
|
789
|
|
787
|
|
|
Other debt, primarily
foreign instruments
|
25
|
|
26
|
|
|
4,937
|
|
5,024
|
|
|
Less: maturities
classified as current
|
1,334
|
|
6
|
|
|
Total long-term
debt
|
$
3,603
|
|
$
5,018
|
|
|
(1)
|
The interest rate on
Term Loan A at December 31, 2021 was LIBOR plus 1.75%.
|
|
ATTACHMENT 1
|
|
TENNECO
INC.
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
Unaudited
|
|
(dollars in
millions)
|
|
Three Months Ended
September 30,
|
|
2022
|
|
2021
|
|
Operating
Activities
|
|
|
|
|
Net income
(loss)
|
$
(28)
|
|
$
25
|
|
Adjustments to
reconcile net income (loss) to cash (used) provided by operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
140
|
|
147
|
|
Deferred income
taxes
|
5
|
|
(4)
|
|
Stock-based
compensation
|
5
|
|
9
|
|
Restructuring charges
and asset impairments, net of cash paid
|
(4)
|
|
(20)
|
|
Change in pension and
other postretirement benefit plans
|
(8)
|
|
(11)
|
|
Equity in earnings of
nonconsolidated affiliates
|
(3)
|
|
(10)
|
|
Cash dividends
received from nonconsolidated affiliates
|
11
|
|
—
|
|
Loss (gain) on sale of
assets and other
|
6
|
|
15
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Receivables
|
(349)
|
|
30
|
|
Inventories
|
56
|
|
(1)
|
|
Payables and accrued
expenses
|
156
|
|
(238)
|
|
Accrued interest and
accrued income taxes
|
15
|
|
(10)
|
|
Other assets and
liabilities
|
53
|
|
20
|
|
Net cash (used)
provided by operating activities
|
55
|
|
(48)
|
|
Investing
Activities
|
|
|
|
|
Proceeds from sale of
assets
|
1
|
|
27
|
|
Net proceeds from sale
of business
|
1
|
|
—
|
|
Proceeds from sale of
investment in nonconsolidated affiliates
|
4
|
|
3
|
|
Cash payments for
property, plant, and equipment
|
(82)
|
|
(101)
|
|
Proceeds from deferred
purchase price of factored receivables
|
98
|
|
102
|
|
Net cash (used)
provided by investing activities
|
22
|
|
31
|
|
Financing
Activities
|
|
|
|
|
Proceeds from term
loans and notes
|
35
|
|
(2)
|
|
Repayments and
extinguishment costs of term loans and notes
|
(54)
|
|
(72)
|
|
Borrowings on revolving
lines of credit
|
2,203
|
|
1,896
|
|
Payments on revolving
lines of credit
|
(2,170)
|
|
(1,903)
|
|
Debt issuance costs of
long-term debt
|
—
|
|
(1)
|
|
Distributions to
noncontrolling interest partners
|
(10)
|
|
(4)
|
|
Collections (payments)
on securitization programs, net and other
|
8
|
|
(5)
|
|
Net cash (used)
provided by financing activities
|
12
|
|
(91)
|
|
Effect of foreign
exchange rate changes on cash, cash equivalents, and restricted
cash
|
(61)
|
|
(16)
|
|
Increase (decrease) in
cash, cash equivalents, and restricted cash
|
28
|
|
(124)
|
|
Cash, cash equivalents,
and restricted cash, beginning of period
|
395
|
|
719
|
|
Cash, cash equivalents,
and restricted cash, end of period
|
$
423
|
|
$
595
|
|
Supplemental Cash
Flow Information
|
|
|
|
|
Cash paid during the
period for interest
|
$
78
|
|
$
62
|
|
Cash paid during the
period for income taxes, net of refunds
|
$
41
|
|
$
42
|
|
Lease assets obtained
in exchange for new operating lease liabilities
|
$
32
|
|
$
9
|
|
Non-cash Investing
Activities
|
|
|
|
|
Period end balance of
accounts payable for property, plant, and equipment
|
$
81
|
|
$
73
|
|
Deferred purchase price
of receivables factored in the period
|
$
88
|
|
$
102
|
|
ATTACHMENT 1
|
|
TENNECO
INC.
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
Unaudited
|
|
(dollars in
millions)
|
|
Nine Months Ended
September 30,
|
|
2022
|
|
2021
|
|
Operating
Activities
|
|
|
|
|
Net income
(loss)
|
$
(151)
|
|
$
129
|
|
Adjustments to
reconcile net income (loss) to cash (used) provided by operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
429
|
|
447
|
|
Deferred income
taxes
|
(2)
|
|
8
|
|
Stock-based
compensation
|
17
|
|
18
|
|
Restructuring charges
and asset impairments, net of cash paid
|
13
|
|
(17)
|
|
Change in pension and
other postretirement benefit plans
|
(29)
|
|
(22)
|
|
Equity in earnings of
nonconsolidated affiliates
|
(25)
|
|
(47)
|
|
Cash dividends
received from nonconsolidated affiliates
|
55
|
|
58
|
|
Loss (gain) on sale of
assets and other
|
(4)
|
|
8
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Receivables
|
(920)
|
|
(451)
|
|
Inventories
|
(237)
|
|
(194)
|
|
Payables and accrued
expenses
|
551
|
|
11
|
|
Accrued interest and
accrued income taxes
|
(1)
|
|
24
|
|
Other assets and
liabilities
|
91
|
|
3
|
|
Net cash (used)
provided by operating activities
|
(213)
|
|
(25)
|
|
Investing
Activities
|
|
|
|
|
Proceeds from sale of
assets
|
13
|
|
39
|
|
Net proceeds from sale
of business
|
3
|
|
1
|
|
Proceeds from sale of
investment in nonconsolidated affiliates
|
5
|
|
6
|
|
Cash payments for
property, plant and equipment
|
(253)
|
|
(286)
|
|
Proceeds from deferred
purchase price of factored receivables
|
310
|
|
356
|
|
Other
|
(1)
|
|
—
|
|
Net cash (used)
provided by investing activities
|
77
|
|
116
|
|
Financing
Activities
|
|
|
|
|
Proceeds from term
loans and notes
|
57
|
|
836
|
|
Repayments and
extinguishment costs of term loans and notes
|
(177)
|
|
(1,011)
|
|
Borrowings on revolving
lines of credit
|
6,221
|
|
4,772
|
|
Payments on revolving
lines of credit
|
(6,160)
|
|
(4,774)
|
|
Debt issuance costs of
long-term debt
|
—
|
|
(13)
|
|
Distributions to
noncontrolling interest partners
|
(44)
|
|
(12)
|
|
Payment for redeemable
noncontrolling interest redemption
|
(53)
|
|
—
|
|
Collections (payments)
on securitization programs, net and other
|
(36)
|
|
(78)
|
|
Net cash (used)
provided by financing activities
|
(192)
|
|
(280)
|
|
Effect of foreign
exchange rate changes on cash, cash equivalents, and restricted
cash
|
(114)
|
|
(19)
|
|
Increase (decrease) in
cash, cash equivalents, and restricted cash
|
(442)
|
|
(208)
|
|
Cash, cash equivalents,
and restricted cash, beginning of period
|
865
|
|
803
|
|
Cash, cash equivalents,
and restricted cash, end of period
|
$
423
|
|
$
595
|
|
Supplemental Cash
Flow Information
|
|
|
|
|
Cash paid during the
period for interest
|
$
192
|
|
$
162
|
|
Cash paid during the
period for income taxes, net of refunds
|
$
172
|
|
$
104
|
|
Lease assets obtained
in exchange for new operating lease liabilities
|
$
61
|
|
$
35
|
|
Non-cash inventory
charge due to aftermarket product line exit
|
$
4
|
|
$
44
|
|
Non-cash Investing
Activities
|
|
|
|
|
Period end balance of
accounts payable for property, plant, and equipment
|
$
81
|
|
$
73
|
|
Deferred purchase price
of receivables factored in the period
|
$
319
|
|
$
368
|
|
ATTACHMENT 2
|
|
TENNECO
INC.
|
|
RECONCILIATION OF
GAAP(1) TO NON-GAAP EARNINGS
MEASURES(2)
|
|
Unaudited
|
|
(millions, except per
share amounts)
|
|
|
Q3
2022
|
|
Q3
2021
|
|
Net
income
(loss)
attributable
to Tenneco
Inc.
|
|
Per
Share
|
|
Net
income
(loss)
attributable to
noncontrolling
interests
|
|
Income
tax
(expense)
benefit
|
|
EBIT
|
|
EBITDA
(3)
|
|
Net
income
(loss)
attributable
to Tenneco
Inc.
|
|
Per
Share
|
|
Net
income
(loss)
attributable to
noncontrolling
interests
|
|
Income
tax
(expense)
benefit
|
|
EBIT
|
|
EBITDA
(3)
|
|
Earnings (Loss)
Measures
|
$
(44)
|
|
$(0.53)
|
|
$
16
|
|
$ (67)
|
|
$ 129
|
|
$ 269
|
|
$
15
|
|
$ 0.17
|
|
$
10
|
|
$ (34)
|
|
$ 125
|
|
$ 272
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and
related expenses (5)
|
11
|
|
0.13
|
|
—
|
|
(1)
|
|
12
|
|
10
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Anti-dumping duty
charge
|
1
|
|
—
|
|
—
|
|
—
|
|
1
|
|
1
|
|
3
|
|
0.03
|
|
—
|
|
—
|
|
3
|
|
3
|
|
Asset
impairments
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1
|
|
0.01
|
|
—
|
|
—
|
|
1
|
|
1
|
|
Other costs (including
strategic and transaction related)
|
17
|
|
0.21
|
|
—
|
|
—
|
|
17
|
|
17
|
|
2
|
|
0.03
|
|
—
|
|
—
|
|
2
|
|
2
|
|
Loss on sale of
unconsolidated affiliate
|
2
|
|
0.03
|
|
—
|
|
—
|
|
2
|
|
2
|
|
1
|
|
0.01
|
|
—
|
|
—
|
|
1
|
|
1
|
|
Other
|
2
|
|
0.02
|
|
—
|
|
—
|
|
2
|
|
2
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Net tax
adjustments
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(7)
|
|
(0.08)
|
|
—
|
|
(7)
|
|
—
|
|
—
|
|
Adjusted Net income,
EPS, NCI, Tax, EBIT, and EBITDA (4)
|
$
(11)
|
|
$
(0.14)
|
|
$
16
|
|
$ (68)
|
|
$ 163
|
|
$ 301
|
|
$
15
|
|
$ 0.17
|
|
$
10
|
|
$ (41)
|
|
$ 132
|
|
$ 279
|
|
Q3
2022
|
|
Global
Segments
|
|
|
|
|
|
Motorparts
|
|
Performance
Solutions
|
|
Clean
Air
|
|
Powertrain
|
|
Total
|
|
Corporate
|
|
Total
|
|
Net income (loss)
attributable to Tenneco Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
$ (44)
|
|
Net income (loss)
attributable to noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
|
|
16
|
|
Net income
(loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
(28)
|
|
Income tax (expense)
benefit
|
|
|
|
|
|
|
|
|
|
|
|
|
(67)
|
|
Interest
expense
|
|
|
|
|
|
|
|
|
|
|
|
|
(90)
|
|
EBIT, Earnings (Loss)
before interest expense, income taxes and noncontrolling
interests
|
|
|
|
|
|
|
|
|
|
|
|
|
129
|
|
Depreciation and
amortization
|
|
|
|
|
|
|
|
|
|
|
|
|
140
|
|
Total EBITDA including
noncontrolling interests (3)
|
$
73
|
|
$
41
|
|
$
131
|
|
$
90
|
|
$
335
|
|
$
(66)
|
|
$ 269
|
|
Restructuring and
related expenses
|
1
|
|
5
|
|
2
|
|
2
|
|
10
|
|
—
|
|
10
|
|
Anti-dumping duty
charge
|
1
|
|
—
|
|
—
|
|
—
|
|
1
|
|
—
|
|
1
|
|
Loss on sale of
unconsolidated affiliate
|
—
|
|
2
|
|
—
|
|
—
|
|
2
|
|
—
|
|
2
|
|
Other costs (including
strategic and transaction related)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
17
|
|
17
|
|
Other
|
1
|
|
1
|
|
—
|
|
—
|
|
2
|
|
—
|
|
2
|
|
Adjusted EBITDA
(4)
|
$
76
|
|
$
49
|
|
$
133
|
|
$
92
|
|
$
350
|
|
$
(49)
|
|
$ 301
|
|
Q3
2021
|
|
Global
Segments
|
|
|
|
|
|
Motorparts
|
|
Performance
Solutions
|
|
Clean
Air
|
|
Powertrain
|
|
Total
|
|
Corporate
|
|
Total
|
|
Net income (loss)
attributable to Tenneco Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
$
15
|
|
Net income (loss)
attributable to noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
|
|
10
|
|
Net income
(loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
25
|
|
Income tax (expense)
benefit
|
|
|
|
|
|
|
|
|
|
|
|
|
(34)
|
|
Interest
expense
|
|
|
|
|
|
|
|
|
|
|
|
|
(66)
|
|
EBIT, Earnings (Loss)
before interest expense, income taxes and noncontrolling
interests
|
|
|
|
|
|
|
|
|
|
|
|
|
125
|
|
Depreciation and
amortization
|
|
|
|
|
|
|
|
|
|
|
|
|
147
|
|
Total EBITDA including
noncontrolling interests (3)
|
$
111
|
|
$
42
|
|
$
138
|
|
$
71
|
|
$
362
|
|
$
(90)
|
|
$ 272
|
|
Restructuring and
related expenses
|
—
|
|
(5)
|
|
(1)
|
|
3
|
|
(3)
|
|
3
|
|
—
|
|
Anti-dumping duty
charge
|
3
|
|
—
|
|
—
|
|
—
|
|
3
|
|
—
|
|
3
|
|
Asset
impairments
|
1
|
|
—
|
|
—
|
|
—
|
|
1
|
|
—
|
|
1
|
|
Loss on sale of
unconsolidated affiliate
|
—
|
|
1
|
|
—
|
|
—
|
|
1
|
|
—
|
|
1
|
|
Other costs (including
strategic and transaction related)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2
|
|
2
|
|
Adjusted EBITDA
(4)
|
$
115
|
|
$
38
|
|
$
137
|
|
$
74
|
|
$
364
|
|
$
(85)
|
|
$ 279
|
|
(1) U.S. Generally
Accepted Accounting Principles.
|
|
|
(2) Tenneco presents
the above reconciliation of GAAP to non-GAAP earnings measures
primarily to reflect the results in a manner that allows a better
understanding of the results of operational activities separate
from the financial impact of decisions made for the long-term
benefit of the company and other items impacting comparability
between the periods. Adjustments similar to the ones reflected
above have been recorded in earlier periods, and similar types of
adjustments can reasonably be expected to be recorded in future
periods. Using only the non-GAAP earnings measures to analyze
earnings would have material limitations because its calculation is
based on the subjective determinations of management regarding the
nature and classification of events and circumstances that
investors may find material. Management compensates for these
limitations by utilizing both GAAP and non-GAAP earnings measures
reflected above to understand and analyze the results of the
business. The company believes investors find the non-GAAP
information helpful in understanding the ongoing performance of
operations separate from items that may have a disproportionate
positive or negative impact on the company's financial results in
any particular period.
|
|
|
(3) EBITDA including
noncontrolling interests represents income before interest expense,
income taxes, noncontrolling interests and depreciation and
amortization. EBITDA including noncontrolling interests is
not a calculation based upon GAAP. The amounts included in
the EBITDA including noncontrolling interests calculation, however,
are derived from amounts included in the historical statements of
income data. In addition, EBITDA including noncontrolling
interests should not be considered as an alternative to net income
attributable to Tenneco Inc. or operating income as an indicator of
the company's operating performance, or as an alternative to
operating cash flows as a measure of liquidity. Tenneco has
presented EBITDA including noncontrolling interests because it
regularly reviews EBITDA including noncontrolling interests as a
measure of the company's performance. In addition, Tenneco
believes its investors utilize and analyze the company's EBITDA
including noncontrolling interests for similar purposes.
Tenneco also believes EBITDA including noncontrolling interests
assists investors in comparing a company's performance on a
consistent basis without regard to depreciation and amortization,
which can vary significantly depending upon many factors.
However, the EBITDA including noncontrolling interests measure
presented may not always be comparable to similarly titled measures
reported by other companies due to differences in the components of
the calculation.
|
|
|
(4) Adjusted results
are presented in order to reflect the results in a manner that
allows a better understanding of operational activities separate
from the financial impact of decisions made for the long term
benefit of the company and other items impacting comparability
between periods. Similar adjustments have been recorded in
earlier periods and similar types of adjustments can reasonably be
expected to be recorded in future periods. The company
believes investors find the non-GAAP information helpful in
understanding the ongoing performance of operations separate from
items that may have a disproportionate positive or negative impact
on the company's financial results in any particular
period.
|
|
|
(5) Q3 2022 includes $2
million of accelerated depreciation related to restructuring and
related expenses.
|
|
ATTACHMENT
2
|
|
TENNECO
INC.
|
|
RECONCILIATION OF
GAAP(1) TO NON-GAAP EARNINGS
MEASURES(2)
|
|
Unaudited
|
|
(in millions, except
per share amounts)
|
|
|
Q3 2022
YTD
|
|
Q3 2021
YTD
|
|
Net
income
(loss)
attributable
to Tenneco
Inc.
|
|
Per
Share
|
|
Net
income
(loss)
attributable to
noncontrolling
interests
|
|
Income
tax
(expense)
benefit
|
|
EBIT
|
|
EBITDA
(3)
|
|
Net
income
(loss)
attributable
to Tenneco
Inc.
|
|
Per
Share
|
|
Net
income
(loss)
attributable to
noncontrolling
interests
|
|
Income
tax
(expense)
benefit
|
|
EBIT
|
|
EBITDA
(3)
|
|
Earnings (Loss)
Measures
|
$ (203)
|
|
$
(2.44)
|
|
$ 52
|
|
$
(140)
|
|
$ 221
|
|
$ 650
|
|
$
70
|
|
$ 0.83
|
|
$ 59
|
|
$
(122)
|
|
$
456
|
|
$ 903
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and
related expenses (5)
|
62
|
|
0.78
|
|
—
|
|
(4)
|
|
66
|
|
64
|
|
57
|
|
0.68
|
|
—
|
|
(5)
|
|
62
|
|
59
|
|
Anti-dumping duty
charge
|
1
|
|
0.01
|
|
—
|
|
—
|
|
1
|
|
1
|
|
3
|
|
0.03
|
|
—
|
|
—
|
|
3
|
|
3
|
|
Inventory write-down
(6)
|
3
|
|
0.03
|
|
—
|
|
(1)
|
|
4
|
|
4
|
|
44
|
|
0.53
|
|
—
|
|
—
|
|
44
|
|
44
|
|
Asset
impairments
|
4
|
|
0.05
|
|
—
|
|
—
|
|
4
|
|
4
|
|
5
|
|
0.05
|
|
—
|
|
1
|
|
4
|
|
4
|
|
Other costs (including
strategic and transaction related)
|
34
|
|
0.41
|
|
—
|
|
—
|
|
34
|
|
33
|
|
15
|
|
0.18
|
|
—
|
|
—
|
|
15
|
|
15
|
|
Loss on sale of
unconsolidated affiliate
|
5
|
|
0.06
|
|
—
|
|
—
|
|
5
|
|
5
|
|
2
|
|
0.03
|
|
—
|
|
—
|
|
2
|
|
2
|
|
Loss on sale of
business
|
2
|
|
0.02
|
|
—
|
|
—
|
|
2
|
|
2
|
|
—
|
|
0.01
|
|
—
|
|
(1)
|
|
1
|
|
1
|
|
Gain on debt
extinguishment
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(8)
|
|
(0.10)
|
|
—
|
|
—
|
|
(8)
|
|
(8)
|
|
Other
|
3
|
|
0.02
|
|
—
|
|
—
|
|
3
|
|
3
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Net tax
adjustments
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(14)
|
|
(0.16)
|
|
—
|
|
(14)
|
|
—
|
|
—
|
|
Adjusted Net income,
EPS, NCI, Tax, EBIT, and EBITDA (4)
|
$ (89)
|
|
$
(1.06)
|
|
$ 52
|
|
$
(145)
|
|
$ 340
|
|
$ 766
|
|
$ 174
|
|
$ 2.08
|
|
$ 59
|
|
$
(141)
|
|
$
579
|
|
$
1,023
|
|
Q3 2022
YTD
|
|
Global
Segments
|
|
|
|
|
|
Motorparts
|
|
Performance
Solutions
|
|
Clean
Air
|
|
Powertrain
|
|
Total
|
|
Corporate
|
|
Total
|
|
Net income (loss)
attributable to Tenneco Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
$
(203)
|
|
Net income (loss)
attributable to noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
|
|
52
|
|
Net income
(loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
(151)
|
|
Income tax (expense)
benefit
|
|
|
|
|
|
|
|
|
|
|
|
|
(140)
|
|
Interest
expense
|
|
|
|
|
|
|
|
|
|
|
|
|
(232)
|
|
EBIT, Earnings (Loss)
before interest expense, income taxes and noncontrolling
interests
|
|
|
|
|
|
|
|
|
|
|
|
|
221
|
|
Depreciation and
amortization
|
|
|
|
|
|
|
|
|
|
|
|
|
429
|
|
Total EBITDA including
noncontrolling interests (3)
|
$
229
|
|
$
67
|
|
$
338
|
|
$
198
|
|
$
832
|
|
$ (182)
|
|
$ 650
|
|
Restructuring and
related expenses
|
5
|
|
19
|
|
10
|
|
23
|
|
57
|
|
7
|
|
64
|
|
Anti-dumping duty
charge
|
1
|
|
—
|
|
—
|
|
—
|
|
1
|
|
—
|
|
1
|
|
Inventory write-down
(6)
|
4
|
|
—
|
|
—
|
|
—
|
|
4
|
|
—
|
|
4
|
|
Loss on sale of
business
|
—
|
|
—
|
|
2
|
|
—
|
|
2
|
|
—
|
|
2
|
|
Asset
impairments
|
2
|
|
—
|
|
—
|
|
2
|
|
4
|
|
—
|
|
4
|
|
Loss on sale of
unconsolidated affiliate
|
—
|
|
5
|
|
—
|
|
—
|
|
5
|
|
—
|
|
5
|
|
Other costs (including
strategic and transaction related)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
33
|
|
33
|
|
Other
|
—
|
|
3
|
|
—
|
|
—
|
|
$ 3
|
|
$
—
|
|
3
|
|
Adjusted EBITDA
(4)
|
$
241
|
|
$
94
|
|
$
350
|
|
$
223
|
|
$
908
|
|
$ (142)
|
|
$ 766
|
|
Q3 2021
YTD
|
|
Global
Segments
|
|
|
|
|
|
Motorparts
|
|
Performance
Solutions
|
|
Clean
Air
|
|
Powertrain
|
|
Total
|
|
Corporate
|
|
Total
|
|
Net income (loss)
attributable to Tenneco Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
$
70
|
|
Net income (loss)
attributable to noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
|
|
59
|
|
Net income
(loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
129
|
|
Income tax (expense)
benefit
|
|
|
|
|
|
|
|
|
|
|
|
|
(122)
|
|
Interest
expense
|
|
|
|
|
|
|
|
|
|
|
|
|
(205)
|
|
EBIT, Earnings (Loss)
before interest expense, income taxes and noncontrolling
interests
|
|
|
|
|
|
|
|
|
|
|
|
|
456
|
|
Depreciation and
amortization
|
|
|
|
|
|
|
|
|
|
|
|
|
447
|
|
Total EBITDA including
noncontrolling interests (3)
|
$
280
|
|
$
117
|
|
$
430
|
|
$
280
|
|
1,107
|
|
$ (204)
|
|
$ 903
|
|
Restructuring and
related expenses
|
8
|
|
8
|
|
10
|
|
22
|
|
48
|
|
11
|
|
59
|
|
Anti-dumping duty
charge
|
3
|
|
—
|
|
—
|
|
—
|
|
3
|
|
—
|
|
3
|
|
Inventory write-down
(6)
|
44
|
|
—
|
|
—
|
|
—
|
|
44
|
|
—
|
|
44
|
|
Loss on sale of
business
|
1
|
|
—
|
|
—
|
|
—
|
|
1
|
|
—
|
|
1
|
|
Asset
impairments
|
2
|
|
—
|
|
—
|
|
—
|
|
2
|
|
2
|
|
4
|
|
Loss on sale of
unconsolidated affiliate
|
—
|
|
2
|
|
—
|
|
—
|
|
2
|
|
—
|
|
2
|
|
Other costs (including
strategic and transaction related)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
15
|
|
15
|
|
Gain on debt
extinguishment
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(8)
|
|
(8)
|
|
Adjusted EBITDA
(4)
|
$
338
|
|
$
127
|
|
$
440
|
|
$
302
|
|
$
1,207
|
|
$ (184)
|
|
$
1,023
|
|
* Beginning in the
first quarter of 2021, the Company made a change to its operating
segments. This change consisted of moving a reporting unit within
the Powertrain segment to the Ride Performance segment. In
addition, with this change to its segments, Ride Performance was
renamed Performance Solutions. As such, prior period operating
segment results have been conformed to reflect the Company's
current operating segments.
|
|
|
(1) U.S. Generally
Accepted Accounting Principles.
|
|
|
(2) Tenneco presents
the above reconciliation of GAAP to non-GAAP earnings measures
primarily to reflect the results in a manner that allows a better
understanding of the results of operational activities separate
from the financial impact of decisions made for the long-term
benefit of the company and other items impacting comparability
between the periods. Adjustments similar to the ones reflected
above have been recorded in earlier periods, and similar types of
adjustments can reasonably be expected to be recorded in future
periods. Using only the non-GAAP earnings measures to analyze
earnings would have material limitations because its calculation is
based on the subjective determinations of management regarding the
nature and classification of events and circumstances that
investors may find material. Management compensates for these
limitations by utilizing both GAAP and non-GAAP earnings measures
reflected above to understand and analyze the results of the
business. The company believes investors find the non-GAAP
information helpful in understanding the ongoing performance of
operations separate from items that may have a disproportionate
positive or negative impact on the company's financial results in
any particular period.
|
|
|
(3) EBITDA including
noncontrolling interests represents income before interest expense,
income taxes, noncontrolling interests and depreciation and
amortization. EBITDA including noncontrolling interests is
not a calculation based upon GAAP. The amounts included in
the EBITDA including noncontrolling interests calculation, however,
are derived from amounts included in the historical statements of
income data. In addition, EBITDA including noncontrolling
interests should not be considered as an alternative to net income
attributable to Tenneco Inc. or operating income as an indicator of
the company's operating performance, or as an alternative to
operating cash flows as a measure of liquidity. Tenneco has
presented EBITDA including noncontrolling interests because it
regularly reviews EBITDA including noncontrolling interests as a
measure of the company's performance. In addition, Tenneco
believes its investors utilize and analyze the company's EBITDA
including noncontrolling interests for similar purposes.
Tenneco also believes EBITDA including noncontrolling interests
assists investors in comparing a company's performance on a
consistent basis without regard to depreciation and amortization,
which can vary significantly depending upon many factors.
However, the EBITDA including noncontrolling interests measure
presented may not always be comparable to similarly titled measures
reported by other companies due to differences in the components of
the calculation.
|
|
|
(4) Adjusted results
are presented in order to reflect the results in a manner that
allows a better understanding of operational activities separate
from the financial impact of decisions made for the long term
benefit of the company and other items impacting comparability
between periods. Similar adjustments have been recorded in
earlier periods and similar types of adjustments can reasonably be
expected to be recorded in future periods. The company
believes investors find the non-GAAP information helpful in
understanding the ongoing performance of operations separate from
items that may have a disproportionate positive or negative impact
on the company's financial results in any particular
period.
|
|
|
(5) Q3 YTD 2022 and Q3
YTD 2021 includes $2 million and $3 million of accelerated
depreciation related to restructuring and related expenses,
respectively.
|
|
|
(6) Non-cash charge to
write-down inventory in the Motorparts segment in connection with
its initiative to rationalize its supply chain and distribution
network.
|
|
ATTACHMENT 2
|
|
TENNECO
INC.
|
|
RECONCILIATION OF
GAAP(1) REVENUE AND EARNINGS TO NON-GAAP REVENUE AND
EARNINGS MEASURES(2)
|
|
Unaudited
|
|
(in millions, except
percents)
|
|
Q3
2022
|
|
Global
Segments
|
|
|
|
|
|
Motorparts
|
|
Performance
Solutions
|
|
Clean
Air
|
|
Powertrain
|
|
Total
|
|
Corporate
|
|
Total
|
|
Net sales and operating
revenues
|
$
723
|
|
$
849
|
|
$ 2,335
|
|
$ 1,024
|
|
$ 4,931
|
|
$
—
|
|
$ 4,931
|
|
Less: Substrate
sales
|
—
|
|
—
|
|
1,295
|
|
—
|
|
1,295
|
|
—
|
|
1,295
|
|
Value-add
revenues
|
$
723
|
|
$
849
|
|
$ 1,040
|
|
$ 1,024
|
|
$ 3,636
|
|
$
—
|
|
$ 3,636
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
$
73
|
|
$
41
|
|
$
131
|
|
$
90
|
|
$
335
|
|
$
(66)
|
|
$
269
|
|
EBITDA as a % of
revenue
|
10.1 %
|
|
4.8 %
|
|
5.6 %
|
|
8.8 %
|
|
6.8 %
|
|
|
|
5.5 %
|
|
EBITDA as a % of
value-add revenue
|
10.1 %
|
|
4.8 %
|
|
12.6 %
|
|
8.8 %
|
|
9.2 %
|
|
|
|
7.4 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
76
|
|
$
49
|
|
$
133
|
|
$
92
|
|
$
350
|
|
$
(49)
|
|
$
301
|
|
Adjusted EBITDA as a %
of revenue
|
10.5 %
|
|
5.8 %
|
|
5.7 %
|
|
9.0 %
|
|
7.1 %
|
|
|
|
6.1 %
|
|
Adjusted EBITDA as a %
of value-add revenue
|
10.5 %
|
|
5.8 %
|
|
12.8 %
|
|
9.0 %
|
|
9.6 %
|
|
|
|
8.3 %
|
|
Q3
2021
|
|
Global
Segments
|
|
|
|
|
|
Motorparts
|
|
Performance
Solutions
|
|
Clean
Air
|
|
Powertrain
|
|
Total
|
|
Corporate
|
|
Total
|
|
Net sales and operating
revenues
|
$
769
|
|
$
686
|
|
$ 1,936
|
|
$
941
|
|
$ 4,332
|
|
$
—
|
|
$ 4,332
|
|
Less: Substrate
sales
|
—
|
|
—
|
|
1,039
|
|
—
|
|
1,039
|
|
—
|
|
1,039
|
|
Value-add
revenues
|
$
769
|
|
$
686
|
|
$
897
|
|
$
941
|
|
$ 3,293
|
|
$
—
|
|
$ 3,293
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
$
111
|
|
$
42
|
|
$
138
|
|
$
71
|
|
$
362
|
|
$
(90)
|
|
$
272
|
|
EBITDA as a % of
revenue
|
14.4 %
|
|
6.1 %
|
|
7.1 %
|
|
7.5 %
|
|
8.4 %
|
|
|
|
6.3 %
|
|
EBITDA as a % of
value-add revenue
|
14.4 %
|
|
6.1 %
|
|
15.4 %
|
`
|
7.5 %
|
|
11.0 %
|
|
|
|
8.3 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
115
|
|
$
38
|
|
$
137
|
|
$
74
|
|
$
364
|
|
$
(85)
|
|
$
279
|
|
Adjusted EBITDA as a %
of revenue
|
15.0 %
|
|
5.5 %
|
|
7.1 %
|
|
7.9 %
|
|
8.4 %
|
|
|
|
6.4 %
|
|
Adjusted EBITDA as a %
of value-add revenue
|
15.0 %
|
|
5.5 %
|
|
15.3 %
|
|
7.9 %
|
|
11.1 %
|
|
|
|
8.5 %
|
|
Q3 2022
YTD
|
|
Global
Segments
|
|
|
|
|
|
Motorparts
|
|
Performance
Solutions
|
|
Clean
Air
|
|
Powertrain
|
|
Total
|
|
Corporate
|
|
Total
|
|
Net sales and operating
revenues
|
$ 2,174
|
|
$ 2,433
|
|
$ 6,575
|
|
$ 3,063
|
|
$
14,245
|
|
$
—
|
|
$
14,245
|
|
Less: Substrate
sales
|
—
|
|
—
|
|
3,517
|
|
—
|
|
3,517
|
|
—
|
|
3,517
|
|
Value-add
revenues
|
$ 2,174
|
|
$ 2,433
|
|
$ 3,058
|
|
$ 3,063
|
|
$
10,728
|
|
$
—
|
|
$
10,728
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
$
229
|
|
$
67
|
|
$
338
|
|
$
198
|
|
$
832
|
|
$
(182)
|
|
$
650
|
|
EBITDA as a % of
revenue
|
10.5 %
|
|
2.8 %
|
|
5.1 %
|
|
6.5 %
|
|
5.8 %
|
|
|
|
4.6 %
|
|
EBITDA as a % of
value-add revenue
|
10.5 %
|
|
2.8 %
|
|
11.1 %
|
|
6.5 %
|
|
7.8 %
|
|
|
|
6.1 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
241
|
|
$
94
|
|
$
350
|
|
$
223
|
|
$
908
|
|
$
(142)
|
|
$
766
|
|
Adjusted EBITDA as a %
of revenue
|
11.1 %
|
|
3.9 %
|
|
5.3 %
|
|
7.3 %
|
|
6.4 %
|
|
|
|
5.4 %
|
|
Adjusted EBITDA as a %
of value-add revenue
|
11.1 %
|
|
3.9 %
|
|
11.4 %
|
|
7.3 %
|
|
8.5 %
|
|
|
|
7.1 %
|
|
Q3 2021
YTD
|
|
Global
Segments
|
|
|
|
|
|
Motorparts
|
|
Performance
Solutions
|
|
Clean
Air
|
|
Powertrain
|
|
Total
|
|
Corporate
|
|
Total
|
|
Net sales and operating
revenues
|
$ 2,282
|
|
$ 2,188
|
|
$ 6,084
|
|
$ 3,092
|
|
$
13,646
|
|
$
—
|
|
$
13,646
|
|
Less: Substrate
sales
|
—
|
|
—
|
|
3,208
|
|
—
|
|
3,208
|
|
—
|
|
3,208
|
|
Value-add
revenues
|
$ 2,282
|
|
$ 2,188
|
|
$ 2,876
|
|
$ 3,092
|
|
$
10,438
|
|
$
—
|
|
$
10,438
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
$
280
|
|
$
117
|
|
$
430
|
|
$
280
|
|
$ 1,107
|
|
$
(204)
|
|
$
903
|
|
EBITDA as a % of
revenue
|
12.3 %
|
|
5.3 %
|
|
7.1 %
|
|
9.1 %
|
|
8.1 %
|
|
|
|
6.6 %
|
|
EBITDA as a % of
value-add revenue
|
12.3 %
|
|
5.3 %
|
|
15.0 %
|
|
9.1 %
|
|
10.6 %
|
|
|
|
8.7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
338
|
|
$
127
|
|
$
440
|
|
$
302
|
|
$ 1,207
|
|
$
(184)
|
|
$ 1,023
|
|
Adjusted EBITDA as a %
of revenue
|
14.8 %
|
|
5.8 %
|
|
7.2 %
|
|
9.8 %
|
|
8.8 %
|
|
|
|
7.5 %
|
|
Adjusted EBITDA as a %
of value-add revenue
|
14.8 %
|
|
5.8 %
|
|
15.3 %
|
|
9.8 %
|
|
11.6 %
|
|
|
|
9.8 %
|
|
(1) U.S. Generally
Accepted Accounting Principles.
|
|
|
(2) Tenneco presents
the above reconciliation of revenues in order to reflect EBITDA and
adjusted EBITDA as a percent of both total revenues and value-add
revenues. Substrate sales include precious metals pricing,
which may be volatile. Substrate sales occur when, at the
direction of its OE customers, Tenneco purchases catalytic
converters or components thereof from suppliers, uses them in its
manufacturing processes and sells them as part of the completed
system. While Tenneco original equipment customers assume the risk
of this volatility, it impacts reported revenue. Excluding
substrate sales removes this impact. Further, presenting
EBITDA and adjusted EBITDA as a percent of value-add revenue
assists investors in evaluating the company's operational
performance without the impact of such substrate sales. See
prior pages for a discussion of EBITDA and adjusted
EBITDA.
|
|
ATTACHMENT 2
|
|
TENNECO
INC.
|
|
RECONCILIATION OF
GAAP(1) TO NON-GAAP REVENUE
MEASURES(2)
|
|
Unaudited
|
|
(in millions, except
percents)
|
|
|
Q3 2021
Value-add
Revenues
|
|
Currency
|
|
Volume, Mix
and Other
|
|
Q3 2022
Value-add
Revenues
|
|
% Change
increase
(decrease)
excluding
currency
|
|
Motorparts
|
$
769
|
|
$
(34)
|
|
$
(12)
|
|
$
723
|
|
(1.6) %
|
|
Performance
Solutions
|
686
|
|
(54)
|
|
217
|
|
849
|
|
31.6 %
|
|
Clean Air
|
897
|
|
(55)
|
|
198
|
|
1,040
|
|
22.1 %
|
|
Powertrain
|
941
|
|
(71)
|
|
154
|
|
1,024
|
|
16.4 %
|
|
Total Tenneco
Inc.
|
$
3,293
|
|
$
(214)
|
|
$
557
|
|
$
3,636
|
|
16.9 %
|
|
Q3 2021 YTD
Value-add
Revenues
|
|
Currency
|
|
Volume, Mix
and Other
|
|
Q3 2022 YTD
Value-add
Revenues
|
|
% Change
increase
(decrease)
excluding
currency
|
|
Motorparts
|
$
2,282
|
|
$
(73)
|
|
$
(35)
|
|
$
2,174
|
|
(1.5) %
|
|
Performance
Solutions
|
2,188
|
|
(122)
|
|
367
|
|
2,433
|
|
16.8 %
|
|
Clean Air
|
2,876
|
|
(119)
|
|
301
|
|
3,058
|
|
10.5 %
|
|
Powertrain
|
3,092
|
|
(174)
|
|
145
|
|
3,063
|
|
4.7 %
|
|
Total Tenneco
Inc.
|
$
10,438
|
|
$
(488)
|
|
$
778
|
|
$
10,728
|
|
7.5 %
|
|
(1) U.S. Generally
Accepted Accounting Principles.
|
|
|
(2) Tenneco presents
the above reconciliation of revenues in order to reflect value-add
revenues separately from the effects of doing business in
currencies other than the U.S. dollar. Additionally,
substrate sales include precious metals pricing, which may be
volatile. Substrate sales occur when, at the direction of its
OE customers, Tenneco purchases catalytic converters or components
thereof from suppliers, uses them in its manufacturing processes
and sells them as part of the completed system. While Tenneco
original equipment customers assume the risk of this volatility, it
impacts reported revenue. Excluding substrate sales removes
this impact. Tenneco uses this information to analyze the
trend in revenues before these factors. Tenneco believes
investors find this information useful in understanding period to
period comparisons in the company's revenues.
|
|
ATTACHMENT 2
|
|
TENNECO
INC.
|
|
RECONCILIATION OF
NON-GAAP MEASURES
|
|
Debt net of
total cash / Adjusted LTM EBITDA including noncontrolling
interests
|
|
Unaudited
|
|
(in millions, except
ratios)
|
|
|
September 30,
2022
|
|
September 30,
2021
|
|
Total debt
|
$
5,030
|
|
$
5,128
|
|
Total cash, cash
equivalents and restricted cash (total cash)
|
423
|
|
595
|
|
Debt net of total cash
balances (1)
|
$
4,607
|
|
$
4,533
|
|
Adjusted LTM EBITDA
including noncontrolling interests (2) (3)
|
$
1,016
|
|
$
1,433
|
|
Net leverage ratio
(4)
|
4.5x
|
|
3.2x
|
|
Q4
2021
|
|
Q1
2022
|
|
Q2
2022
|
|
Q3
2022
|
|
Q3 2022
LTM
|
|
Net income (loss)
attributable to Tenneco Inc.
|
$
(35)
|
|
$
(38)
|
|
$
(121)
|
|
$
(44)
|
|
$
(238)
|
|
Net income (loss)
attributable to noncontrolling interests
|
6
|
|
19
|
|
17
|
|
16
|
|
58
|
|
Net income
(loss)
|
(29)
|
|
(19)
|
|
(104)
|
|
(28)
|
|
(180)
|
|
Income tax (expense)
benefit
|
(60)
|
|
(30)
|
|
(43)
|
|
(67)
|
|
(200)
|
|
Interest
expense
|
(69)
|
|
(66)
|
|
(76)
|
|
(90)
|
|
(301)
|
|
EBIT, Earnings (Loss)
before interest expense, income taxes and noncontrolling
interests
|
100
|
|
77
|
|
15
|
|
129
|
|
321
|
|
Depreciation and
amortization
|
146
|
|
146
|
|
143
|
|
140
|
|
575
|
|
Total EBITDA including
noncontrolling interests (2)
|
$
246
|
|
$
223
|
|
$
158
|
|
$
269
|
|
$
896
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
Restructuring and
related expenses
|
16
|
|
17
|
|
37
|
|
10
|
|
80
|
|
Anti-dumping duty
charge
|
—
|
|
—
|
|
—
|
|
1
|
|
1
|
|
Inventory write-down
(5)
|
—
|
|
4
|
|
—
|
|
—
|
|
4
|
|
Other costs (including
strategic and transaction related)
|
2
|
|
4
|
|
12
|
|
17
|
|
35
|
|
Asset
impairments
|
17
|
|
4
|
|
—
|
|
—
|
|
21
|
|
Loss on sale of
unconsolidated affiliate
|
2
|
|
—
|
|
3
|
|
2
|
|
7
|
|
(Gain)/Loss on sale of
assets or business
|
(31)
|
|
2
|
|
—
|
|
—
|
|
(29)
|
|
Other
|
(2)
|
|
(1)
|
|
2
|
|
2
|
|
1
|
|
Total Adjusted EBITDA
including noncontrolling interests (3)
|
$
250
|
|
$
253
|
|
$
212
|
|
$
301
|
|
$
1,016
|
|
Q4
2020
|
|
Q1
2021
|
|
Q2
2021
|
|
Q3
2021
|
|
Q3 2021
LTM
|
|
Net income (loss)
attributable to Tenneco Inc.
|
$
167
|
|
$
65
|
|
$
(10)
|
|
$
15
|
|
$
237
|
|
Net income (loss)
attributable to noncontrolling interests
|
19
|
|
22
|
|
27
|
|
10
|
|
78
|
|
Net income
(loss)
|
186
|
|
87
|
|
17
|
|
25
|
|
315
|
|
Income tax (expense)
benefit
|
(6)
|
|
(47)
|
|
(41)
|
|
(34)
|
|
(128)
|
|
Interest
expense
|
(68)
|
|
(70)
|
|
(69)
|
|
(66)
|
|
(273)
|
|
EBIT, Earnings (Loss)
before interest expense, income taxes and noncontrolling
interests
|
260
|
|
204
|
|
127
|
|
125
|
|
716
|
|
Depreciation and
amortization
|
158
|
|
155
|
|
145
|
|
147
|
|
605
|
|
Total EBITDA including
noncontrolling interests (2)
|
$
418
|
|
$
359
|
|
$
272
|
|
$
272
|
|
$
1,321
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
Restructuring and
related expenses
|
6
|
|
28
|
|
31
|
|
—
|
|
65
|
|
Inventory write-down
(5)
|
—
|
|
—
|
|
44
|
|
—
|
|
44
|
|
Other costs (including
strategic and transaction related)
|
1
|
|
8
|
|
5
|
|
2
|
|
16
|
|
Asset
impairments
|
—
|
|
—
|
|
3
|
|
1
|
|
4
|
|
Loss on sale of
unconsolidated affiliate
|
—
|
|
—
|
|
1
|
|
1
|
|
2
|
|
Antitrust reserve
change in estimate (6)
|
(11)
|
|
—
|
|
—
|
|
—
|
|
(11)
|
|
Anti-dumping duty
charge
|
—
|
|
—
|
|
—
|
|
3
|
|
3
|
|
(Gain)/Loss on sale of
assets or business
|
(2)
|
|
1
|
|
—
|
|
—
|
|
(1)
|
|
Gain on extinguishment
of debt
|
(2)
|
|
(8)
|
|
—
|
|
—
|
|
(10)
|
|
Total Adjusted EBITDA
including noncontrolling interests (3)
|
$
410
|
|
$
388
|
|
$
356
|
|
$
279
|
|
$
1,433
|
|
(1) Tenneco presents
debt net of total cash balances because management believes it is a
useful measure of Tenneco's credit position and progress toward
reducing leverage. The calculation is limited in that the company
may not always be able to use cash to repay debt on a
dollar-for-dollar basis.
|
|
|
(2) EBITDA including
noncontrolling interests represents income before interest expense,
income taxes, noncontrolling interests and depreciation and
amortization. EBITDA including noncontrolling interests is not a
calculation based upon GAAP. The amounts included in the EBITDA
including noncontrolling interests calculation, however, are
derived from amounts included in the historical statements of
income data. In addition, EBITDA including noncontrolling interests
should not be considered as an alternative to net income
attributable to Tenneco Inc. or operating income as an indicator of
the company's operating performance, or as an alternative to
operating cash flows as a measure of liquidity. Tenneco has
presented EBITDA including noncontrolling interests because it
regularly reviews EBITDA including noncontrolling interests as a
measure of the company's performance. In addition, Tenneco believes
its investors utilize and analyze the company's EBITDA including
noncontrolling interests for similar purposes. Tenneco also
believes EBITDA including noncontrolling interests assists
investors in comparing a company's performance on a consistent
basis without regard to depreciation and amortization, which can
vary significantly depending upon many factors. However, the EBITDA
including noncontrolling interests measure presented may not always
be comparable to similarly titled measures reported by other
companies due to differences in the components of the
calculation.
|
|
|
(3) Adjusted EBITDA
including noncontrolling interests is presented in order to reflect
the results in a manner that allows a better understanding of
operational activities separate from the financial impact of
decisions made for the long term benefit of the company and other
items impacting comparability between the periods. Similar
adjustments to EBITDA including noncontrolling interests have been
recorded in earlier periods, and similar types of adjustments can
reasonably be expected to be recorded in future periods. The
company believes investors find the non-GAAP information helpful in
understanding the ongoing performance of operations separate from
items that may have a disproportionate positive or negative impact
on the company's financial results in any particular
period.
|
|
|
(4) Net leverage ratio
represents ratio of debt net of total cash balances to adjusted LTM
EBITDA including noncontrolling interests. Tenneco presents the
above reconciliation of the net leverage ratio to show trends that
investors may find useful in understanding the company's ability to
service its debt. For purposes of this calculation, Adjusted LTM
EBITDA including noncontrolling interests is used as an indicator
of the company's performance and debt net of total cash is
presented as an indicator of the company's credit position and
progress toward reducing the company's financial leverage. This
reconciliation is provided as supplemental information and not
intended to replace the company's existing covenant ratios or any
other financial measures that investors may find useful in
describing the company's financial position. See notes (1), (2) and
(3) for a description of the limitations of using debt net of total
cash, EBITDA including noncontrolling interests and Adjusted EBITDA
including noncontrolling interests. See the company's fourth
quarter earnings release dated February 23, 2022 for the
calculation of net leverage ratio as of December 31,
2021.
|
|
|
(5) Non-cash charge to
write-down inventory in the Motorparts segment in connection with
its initiative to rationalize its supply chain and distribution
network.
|
|
|
(6) Reduction in
estimated antitrust accrual.
|
|
ATTACHMENT 2
|
|
TENNECO
INC.
|
|
RECONCILIATION OF
GAAP(1) TO NON-GAAP REVENUE
MEASURES(2)
|
|
Unaudited
|
|
(in
millions)
|
|
|
Q3
2022
|
|
Original equipment
light
vehicle revenues
|
|
Original
equipment
commercial truck, off-
highway, industrial and
other revenues
|
|
Aftermarket &
original
equipment service
revenues
|
|
Total
|
|
Net sales and operating
revenues
|
$
3,111
|
|
$
733
|
|
$
1,087
|
|
$
4,931
|
|
Less: Substrate
sales
|
1,109
|
|
145
|
|
41
|
|
1,295
|
|
Value-add
revenues
|
$
2,002
|
|
$
588
|
|
$
1,046
|
|
$
3,636
|
|
|
|
|
|
|
|
|
|
Q3
2021
|
|
Original equipment
light
vehicle revenues
|
|
Original
equipment
commercial truck, off-
highway, industrial and
other revenues
|
|
Aftermarket &
original
equipment service
revenues
|
|
Total
|
|
Net sales and operating
revenues
|
$
2,439
|
|
$
757
|
|
$
1,136
|
|
$
4,332
|
|
Less: Substrate
sales
|
837
|
|
160
|
|
42
|
|
1,039
|
|
Value-add
revenues
|
$
1,602
|
|
$
597
|
|
$
1,094
|
|
$
3,293
|
|
Q3 2022
YTD
|
|
Original equipment
light
vehicle revenues
|
|
Original
equipment
commercial truck, off-
highway, industrial and
other revenues
|
|
Aftermarket &
original
equipment service
revenues
|
|
Total
|
|
Net sales and operating
revenues
|
$
8,690
|
|
$
2,281
|
|
$
3,274
|
|
$
14,245
|
|
Less: Substrate
sales
|
2,952
|
|
444
|
|
121
|
|
3,517
|
|
Value-add
revenues
|
$
5,738
|
|
$
1,837
|
|
$
3,153
|
|
$
10,728
|
|
|
|
|
|
Q3 2021
YTD
|
|
Original equipment
light
vehicle revenues
|
|
Original
equipment
commercial truck, off-
highway, industrial and
other revenues
|
|
Aftermarket &
original
equipment service
revenues
|
|
Total
|
|
Net sales and operating
revenues
|
$
7,945
|
|
$
2,319
|
|
$
3,382
|
|
$
13,646
|
|
Less: Substrate
sales
|
2,614
|
|
471
|
|
123
|
|
3,208
|
|
Value-add
revenues
|
$
5,331
|
|
$
1,848
|
|
$
3,259
|
|
$
10,438
|
|
Q3 2021
Value-add
Revenues
|
|
Currency
|
|
Volume,
Mix and
Other
|
|
Q3 2022
Value-add
Revenues
|
|
% Change
increase
(decrease)
excluding
currency
|
|
Original equipment
light vehicle revenues
|
$
1,602
|
|
$
(106)
|
|
$
506
|
|
$
2,002
|
|
31.6 %
|
|
Original equipment
commercial truck, off-highway, industrial and other
revenues
|
597
|
|
(39)
|
|
30
|
|
588
|
|
5.0 %
|
|
Aftermarket &
original equipment service revenues
|
1,094
|
|
(69)
|
|
21
|
|
1,046
|
|
1.9 %
|
|
Total Tenneco
Inc.
|
$
3,293
|
|
$
(214)
|
|
$
557
|
|
$
3,636
|
|
16.9 %
|
|
Q3 2021
YTD Value-
add
Revenues
|
|
Currency
|
|
Volume,
Mix and
Other
|
|
Q3 2022
YTD Value-
add Revenues
|
|
% Change
increase
(decrease)
excluding
currency
|
|
Original equipment
light vehicle revenues
|
$
5,331
|
|
$
(249)
|
|
$
656
|
|
$
5,738
|
|
12.3 %
|
|
Original equipment
commercial truck, off-highway, industrial and other
revenues
|
1,848
|
|
(85)
|
|
74
|
|
1,837
|
|
4.0 %
|
|
Aftermarket &
original equipment service revenues
|
3,259
|
|
(154)
|
|
48
|
|
3,153
|
|
1.5 %
|
|
Total Tenneco
Inc.
|
$
10,438
|
|
$
(488)
|
|
$
778
|
|
$
10,728
|
|
7.5 %
|
|
(1) U.S. Generally
Accepted Accounting
Principles.
|
|
|
(2) Tenneco presents
the above reconciliation of revenues in order to reflect value-add
revenues separately from the effects of doing business in
currencies other than the U.S. dollar. Additionally,
substrate sales include precious metals pricing, which may be
volatile. Substrate sales occur when, at the direction of its
OE customers, Tenneco purchases catalytic converters or components
thereof from suppliers, uses them in its manufacturing processes
and sells them as part of the completed system. While Tenneco
original equipment customers assume the risk of this volatility, it
impacts reported revenue. Excluding substrate sales removes
this impact. Tenneco uses this information to analyze the
trend in revenues before these factors. Tenneco believes
investors find this information useful in understanding period to
period comparisons in the company's revenues.
|
|
ATTACHMENT 2
|
|
TENNECO
INC.
|
|
RECONCILIATION OF
GAAP(1) TO NON-GAAP CASH FLOW
MEASURES(2)
|
|
Unaudited
|
|
(in
millions)
|
|
|
Q3
2022
|
|
Q3
2021
|
|
Cash from
operations
|
$
55
|
|
$
(48)
|
|
Proceeds from deferred
purchase price of factored receivables (1)
|
98
|
|
102
|
|
Capital
expenditures
|
(82)
|
|
(101)
|
|
Payments to
noncontrolling interest partners
|
(10)
|
|
(4)
|
|
Other investing and
financing
|
(44)
|
|
6
|
|
Free cash flow for debt
service (2) (Change in net debt)
|
$
17
|
|
$
(45)
|
|
|
|
|
|
Q3 2022
YTD
|
|
Q3 2021
YTD
|
|
Cash from
operations
|
$
(213)
|
|
$
(25)
|
|
Proceeds from deferred
purchase price of factored receivables (1)
|
310
|
|
356
|
|
Capital
expenditures
|
(253)
|
|
(286)
|
|
Payments to
noncontrolling interest partners
|
(97)
|
|
(12)
|
|
Other investing and
financing
|
(144)
|
|
(36)
|
|
Free cash flow for debt
service (2) (Change in net debt)
|
$
(397)
|
|
$
(3)
|
|
(1) U.S. Generally
Accepted Accounting Principles requires reclassification of amount
from Change in receivables in the Cash from operations
section.
|
|
|
(2) Tenneco presents
the above reconciliation of cash flow from operation to Free Cash
Flow for debt service. Free Cash Flow for debt service represents
cash flow from operations, plus the proceeds from deferred purchase
price of factored receivables less the amount of cash payments for
property, plant and equipment and payments to noncontrolling
interest partners, as well as various other amounts. Free
Cash Flow for debt service is not a GAAP calculation and should not
be considered as an alternative to operating cash flows as a
measure of liquidity. Tenneco has presented Free Cash Flow for debt
service because it regularly reviews Free Cash Flow for debt
service as a measure of the company's performance and ability to
reduce net debt. In addition, Tenneco believes its investors
utilize and analyze the company's Free Cash Flow for debt service
for similar purposes. However, the Free Cash Flow for debt service
measure presented may not always be comparable to similarly titled
measures reported by other companies due to differences in the
components of the calculation.
|
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SOURCE Tenneco Inc.