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For the fiscal year ended December 31, 2014
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For the transition period from _____ to _____
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Delaware
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65-0773649
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification Number)
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Securities registered pursuant to Section 12(b) of the Exchange Act:
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||
Title of each class
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Name of each exchange on which registered
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Common Stock, $.01 par value
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New York Stock Exchange, Inc.
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Preferred Stock Purchase Rights
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Large accelerated filer
ý
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Accelerated filer
o
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Non-accelerated filer
o
(Do not check if a smaller reporting company)
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Smaller reporting company
o
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PART I
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|
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PART II
|
|
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PART III
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|
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PART IV
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|
|
•
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Fluid catalytic cracking catalysts
, also called FCC catalysts, that help to "crack" the hydrocarbon chain in distilled crude oil to produce transportation fuels, such as gasoline and diesel fuels, and other petroleum-based products; and FCC additives used to reduce sulfur in gasoline, maximize propylene production from refinery FCC units, and reduce emissions of sulfur oxides, nitrogen oxides and carbon monoxide from refinery FCC units.
|
•
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Hydroprocessing catalysts (HPC)
, most of which are marketed through our Advanced Refining Technologies LLC, or ART, joint venture with Chevron Products Company in which we hold a 50% economic interest, that are used in process reactors to upgrade heavy oils into lighter, more useful products by removing impurities such as nitrogen, sulfur and heavy metals, allowing less expensive feedstocks to be used in the petroleum refining process (ART is not consolidated in our financial statements, so ART's sales are excluded from our sales).
|
•
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Polyolefin catalysts and catalyst supports
, also called specialty catalysts (SC), for the production of polypropylene and polyethylene thermoplastic resins, which can be customized to enhance the performance of a wide range of industrial and consumer end-use applications including high pressure pipe, geomembranes, food packaging, automotive parts, medical devices, and textiles;
chemical catalysts
used in a variety of industrial, environmental and consumer applications; and
gas-phase polypropylene process technology
, which provides our licensees with a reliable capability to manufacture polypropylene products for a broad array of end-use applications.
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•
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Engineered materials
, including silica-based and silica-alumina-based materials, used in:
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•
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Coatings and print media applications, including functional additives that provide matting effects and corrosion protection for industrial and consumer coatings and media and paper products to enhance quality in ink jet coatings.
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•
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Consumer applications, as a free-flow agent, carrier or processing aid in food and personal care products; as a toothpaste abrasive and thickener; and for the processing and stabilization of edible oils and beverages.
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•
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Industrial applications, such as tires and rubber, precision investment casting, refractory, insulating glass windows, adsorbents for use in petrochemical and natural gas processes and biofuels, various functions such as reinforcement, high temperature binding and moisture scavenging.
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•
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Pharmaceutical, life science and related applications including silica-based separation media, excipients and pharmaceutical intermediates; complementary purification products, chromatography consumables, and instruments; and CO
2
absorbents used in anesthesiology and mine safety applications.
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•
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Packaging products
, including can and closure sealants used to seal and enhance the shelf life of can and bottle contents; coatings for cans and closures that prevent metal corrosion, protect package contents from the influence of metal and ensure proper adhesion of sealing compounds; and scavenging technologies designed to reduce off-taste and extend the shelf-life of packaged products.
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•
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Specialty construction chemicals
(SCC) used to improve the performance of portland cement and materials based on portland cement including:
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•
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Concrete admixtures that are sold to ready-mix, precast, and sprayed concrete producers to improve the rheology, workability, quality, durability and other engineering properties of concrete, reduce production costs and provide differentiated product offerings. Certain of our concrete admixtures include polyolefin fibers which are used to improve the strength of concrete and enables the replacement of steel reinforcement, in certain cases.
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•
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Cement additives that are sold to manufacturers of portland cement to improve energy efficiency in cement milling operations and to enhance the characteristics of finished cement. Our additives are also used by cement manufacturers to meet national standards for cement quality at lower production cost and with a reduced environmental footprint, including lower CO
2
emissions.
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•
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Specialty building materials
(SBM) used in both new construction and renovation/repair projects including:
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•
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Sheet and liquid membrane systems that protect commercial buildings, residential buildings and infrastructure from above- and below-grade water penetration and above-grade vapor and air penetration and underlayments used to protect sloped roofs from wind and water penetration.
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•
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invest in research and development activities, with the goal of introducing new high-performance, technically differentiated products and services and enhancing manufacturing processes and operations;
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•
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expand sales and manufacturing into emerging regions, including China, India, other economies in Asia, Eastern Europe, the Middle East and Latin America;
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•
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pursue selected acquisitions and alliances that complement our current product offerings or provide opportunities for faster penetration of desirable market or geographic segments; and
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•
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continue our commitment to process and productivity improvements and cost-management, such as rigorous controls on working capital and capital spending, integration of functional support services worldwide, and programs for improving operations and supply chain management.
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•
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value-added products, technologies and services, sold at competitive prices;
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•
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customer service, including rapid response to changing customer needs;
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•
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technological leadership (resulting from investment in research and development and technical customer service); and
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•
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reliability of product and supply.
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2014
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2013
|
|
2012
|
|||||||||||||||
(In millions)
|
Sales
|
|
% of Grace Revenue
|
|
Sales
|
|
% of Grace Revenue
|
|
Sales
|
|
% of Grace Revenue
|
|||||||||
Refining Catalysts
|
$
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845.5
|
|
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26.0
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%
|
|
$
|
832.4
|
|
|
27.2
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%
|
|
$
|
986.8
|
|
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31.3
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%
|
Polyolefin and Chemical Catalysts
|
401.3
|
|
|
12.4
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%
|
|
291.6
|
|
|
9.5
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%
|
|
281.3
|
|
|
8.9
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%
|
|||
Total Catalysts Technologies Revenue
|
$
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1,246.8
|
|
|
38.4
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%
|
|
$
|
1,124.0
|
|
|
36.7
|
%
|
|
$
|
1,268.1
|
|
|
40.2
|
%
|
|
2014
|
|
2013
|
|
2012
|
|||||||||||||||
(In millions)
|
Sales
|
|
% of Catalysts Technologies Revenue
|
|
Sales
|
|
% of Catalysts Technologies Revenue
|
|
Sales
|
|
% of Catalysts Technologies Revenue
|
|||||||||
North America
|
$
|
431.7
|
|
|
34.6
|
%
|
|
$
|
359.8
|
|
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32.0
|
%
|
|
$
|
382.1
|
|
|
30.1
|
%
|
Europe Middle East Africa
|
452.8
|
|
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36.3
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%
|
|
459.2
|
|
|
40.9
|
%
|
|
543.5
|
|
|
42.8
|
%
|
|||
Asia Pacific
|
260.0
|
|
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20.9
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%
|
|
223.0
|
|
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19.8
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%
|
|
256.9
|
|
|
20.3
|
%
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|||
Latin America
|
102.3
|
|
|
8.2
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%
|
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82.0
|
|
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7.3
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%
|
|
85.6
|
|
|
6.8
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%
|
|||
Total Catalysts Technologies Revenue
|
$
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1,246.8
|
|
|
100.0
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%
|
|
$
|
1,124.0
|
|
|
100.0
|
%
|
|
$
|
1,268.1
|
|
|
100.0
|
%
|
|
2014
|
|
2013
|
|
2012
|
|||||||||||||||
(In millions)
|
Sales
|
|
% of Grace Revenue
|
|
Sales
|
|
% of Grace Revenue
|
|
Sales
|
|
% of Grace Revenue
|
|||||||||
Engineered Materials
|
$
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515.8
|
|
|
15.9
|
%
|
|
$
|
494.4
|
|
|
16.2
|
%
|
|
$
|
478.3
|
|
|
15.1
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%
|
Packaging Products
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374.8
|
|
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11.6
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%
|
|
384.1
|
|
|
12.5
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%
|
|
384.3
|
|
|
12.2
|
%
|
|||
Total Materials Technologies Revenue
|
$
|
890.6
|
|
|
27.5
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%
|
|
$
|
878.5
|
|
|
28.7
|
%
|
|
$
|
862.6
|
|
|
27.3
|
%
|
|
2014
|
|
2013
|
|
2012
|
|||||||||||||||
(In millions)
|
Sales
|
|
% of Materials Technologies Revenue
|
|
Sales
|
|
% of Materials Technologies Revenue
|
|
Sales
|
|
% of Materials Technologies Revenue
|
|||||||||
North America
|
$
|
187.5
|
|
|
21.1
|
%
|
|
$
|
176.7
|
|
|
20.1
|
%
|
|
$
|
174.0
|
|
|
20.2
|
%
|
Europe Middle East Africa
|
373.5
|
|
|
41.9
|
%
|
|
367.8
|
|
|
41.9
|
%
|
|
362.4
|
|
|
41.9
|
%
|
|||
Asia Pacific
|
198.7
|
|
|
22.3
|
%
|
|
197.4
|
|
|
22.5
|
%
|
|
185.9
|
|
|
21.6
|
%
|
|||
Latin America
|
130.9
|
|
|
14.7
|
%
|
|
136.6
|
|
|
15.5
|
%
|
|
140.3
|
|
|
16.3
|
%
|
|||
Total Materials Technologies Revenue
|
$
|
890.6
|
|
|
100.0
|
%
|
|
$
|
878.5
|
|
|
100.0
|
%
|
|
$
|
862.6
|
|
|
100.0
|
%
|
Application
|
|
Use
|
|
Key Brands
|
Coatings and Print Media
|
|
Matting agents, anticorrosion pigments, TiO
2
extenders and moisture scavengers for paints and lacquers
|
|
SYLOID
®
, SHIELDEX
®
, SYLOSIV
®
, SYLOWHITE™
|
|
|
Additives and formulations for matte, semi-glossy and glossy ink receptive coatings on high performance ink jet papers, photo paper, and commercial wide-format print media
|
|
SYLOJET
®
, DURAFILL
®
, LUDOX
®
|
|
|
Paper retention aids, functional fillers, paper frictionizers
|
|
DURAFILL
®
, LUDOX
®
|
Consumer
|
|
Toothpaste abrasives and thickening agents, free-flow agents, anticaking agents, tabletting aids, cosmetic additives and flavor carriers
|
|
SYLOID
®
FP, SYLODENT
®
, SYLOID
®
, SYLOBLANC
®
, SYLOSIV
®
|
|
|
Edible oil refining agents, beer stabilizers and clarification aids for beer, juices and other beverages
|
|
DARACLAR
®
, TRISYL
®
|
Industrial
|
|
Reinforcing agents for rubber and tires
|
|
PERKASIL
®
|
|
|
Inorganic binders and surface smoothening aids for precision investment casting and refractory applications
|
|
LUDOX
®
|
|
|
Adsorbents for dual pane windows and industrial applications, desiccant granules, beads, powders and bags and polyurethane moisture scavengers
|
|
PHONOSORB
®
, SYLOBEAD
®
, SYLOSIV
®
, CRYOSIV
®
, SAFETYSORB
®
|
|
|
Chemical metal polishing aids and formulations for chemical mechanical planarization/electronics applications
|
|
LUDOX
®
, POLIEDGE
®
|
|
|
Polymer additives for producers and processors of plastic products that prevent layers of polymer film from sticking together, improve dispersal of pigments and ease removal from molds
|
|
SYLOBLOC
®
|
|
|
Process adsorbents used in petrochemical and natural gas processes for such applications as ethylene-cracked-gas-drying, natural gas drying and sulfur removal
|
|
SYLOBEAD
®
|
Discovery Sciences
|
|
Pharmaceutical excipients and intermediates
|
|
SYLOID
®
FP
|
|
|
Fine chemical intermediates
|
|
SYNTHETECH
®
™
|
|
|
Preparative scale purification products including media, column hardware, and equipment
|
|
DAVISIL
®
, VYDAC
®
, MODCOL
®
, SPRING
®
, MULTIPACKER
®
|
|
|
Flash chromatography systems and consumables
|
|
REVELERIS
®
, REVEALX™, GRACERESOLV™
|
|
|
Analytical scale high performance liquid chromatography (HPLC) columns and detectors
|
|
VISIONHT
®
, VYDAC
®
, ALLTECH
®
, ALLTIMA
®
|
|
|
CO
2
absorbents for anesthesiology and re-breathing applications
|
|
SODASORB
®
|
Products
|
|
Key Brands
|
Can sealants for rigid containers that ensure a hermetic seal between the lid and the body of beverage, food, aerosol and other cans
|
|
DAREX
®
|
Sealants for metal and plastic bottle closures that are used on pry-off and twist-off metal crowns, as well as roll-on pilfer-proof and plastic closures to seal and enhance the shelf life of food and beverages in glass and plastic bottles and jars
|
|
DAREX
®
, DARAFORM
®
, DARASEAL
®
, DARABLEND
®
, SINCERA
®
, CELOX
®
|
Coatings for metal packaging that are used in the manufacture of cans and closures to protect the metal against corrosion, protect the contents against the influences of metal, ensure proper adhesion of sealing compounds to metal surfaces, and provide base coats for inks and for decorative purposes
|
|
DAREX
®
, APPERTA
®
, SISTIAGA
®
|
|
2014
|
|
2013
|
|
2012
|
|||||||||||||||
(In millions)
|
Sales
|
|
% of Grace Revenue
|
|
Sales
|
|
% of Grace Revenue
|
|
Sales
|
|
% of Grace Revenue
|
|||||||||
Specialty Construction Chemicals
|
$
|
688.7
|
|
|
21.2
|
%
|
|
$
|
650.4
|
|
|
21.3
|
%
|
|
$
|
642.6
|
|
|
20.4
|
%
|
Specialty Building Materials
|
416.9
|
|
|
12.9
|
%
|
|
407.8
|
|
|
13.3
|
%
|
|
382.2
|
|
|
12.1
|
%
|
|||
Total Construction Products Revenue
|
$
|
1,105.6
|
|
|
34.1
|
%
|
|
$
|
1,058.2
|
|
|
34.6
|
%
|
|
$
|
1,024.8
|
|
|
32.5
|
%
|
|
2014
|
|
2013
|
|
2012
|
|||||||||||||||
(In millions)
|
Sales
|
|
% of Construction Products Revenue
|
|
Sales
|
|
% of Construction Products Revenue
|
|
Sales
|
|
% of Construction Products Revenue
|
|||||||||
North America
|
$
|
436.0
|
|
|
39.4
|
%
|
|
$
|
423.2
|
|
|
39.9
|
%
|
|
$
|
411.5
|
|
|
40.2
|
%
|
Europe Middle East Africa
|
270.7
|
|
|
24.5
|
%
|
|
260.9
|
|
|
24.7
|
%
|
|
269.7
|
|
|
26.3
|
%
|
|||
Asia Pacific
|
257.5
|
|
|
23.3
|
%
|
|
233.7
|
|
|
22.1
|
%
|
|
217.5
|
|
|
21.2
|
%
|
|||
Latin America
|
141.4
|
|
|
12.8
|
%
|
|
140.4
|
|
|
13.3
|
%
|
|
126.1
|
|
|
12.3
|
%
|
|||
Total Construction Products Revenue
|
$
|
1,105.6
|
|
|
100.0
|
%
|
|
$
|
1,058.2
|
|
|
100.0
|
%
|
|
$
|
1,024.8
|
|
|
100.0
|
%
|
Products
|
|
Uses
|
|
Customers
|
|
Key Brands
|
Concrete admixtures
|
|
Concrete admixtures and polymeric fibers used to reduce the production and in-place costs of concrete, increase the performance of concrete and improve the life cycle cost of structures
|
|
Ready-mix and precast concrete producers, engineers and specifiers
|
|
ADVA
®
, STRUX
®
,
MIRA
®
,
POLARSET
®
, ECLIPSE
®
|
Additives for cement processing
|
|
Cement additives added to the milling stage of the cement manufacturing process to improve plant energy efficiency, enhance the performance of the finished cement and help our customers meet environmental regulations and reduce their CO
2
footprints
|
|
Cement manufacturers
|
|
CBA
®
, SYNCHRO
®
, HEA2
®
, TDA
®
|
Admixtures for masonry concrete
|
|
Products for masonry concrete used by block and paver producers for process efficiency and to improve the appearance, durability and water resistance of finished concrete masonry units
|
|
Masonry block manufacturers
|
|
DRY-BLOCK
®
, OPTEC
®
, QUANTEC
®
|
Process control solutions for ready-mix concrete
|
|
Services to provide concrete producers quality control and operational efficiencies using sensors and other technologies
|
|
Ready-mix concrete manufacturers
|
|
VERIFI
®
|
Products
|
|
Uses
|
|
Customers
|
|
Key Brands
|
Structural waterproofing, vapor and air barrier systems
|
|
Structural waterproofing and air barrier systems to prevent water, vapor and/or air infiltration in commercial structures, including self-adhered sheet and liquid membranes, joint sealing materials, drainage composites and waterstops.
|
|
Architects and structural engineers; specialty waterproofing and general contractors; specialty waterproofing distributors
|
|
BITUTHENE
®
, PROCOR
®
, PREPRUFE
®
, ADPRUFE™, HYDRODUCT
®
, PERM-A-BARRIER
®
, ADCOR
®
ES, SILCOR
®
|
Residential building materials
|
|
Specialty roofing membranes and flexible flashings for windows, doors, decks and detail areas, including fully adhered roofing underlayments, synthetic underlayments and self-adhered flashing.
|
|
Roofing contractors, home builders and remodelers; specialty roofing distributors, lumberyards and home centers; homeowners; architects and specifiers
|
|
ICE & WATER SHIELD
®
, TRI-FLEX
®
, VYCOR
®
|
Chemical grouts
|
|
Products for repair and remediation in waterproofing applications and soil stabilization
|
|
Contractors; specialty distributors; municipalities; and other owners of large infrastructure facilities
|
|
DE NEEF™ HYDRO ACTIVE
®
Cut,
DE NEEF™ AC-400, DE NEEF™ SWELLSEAL
®
WA, DE NEEF™ MC-500™
|
Fire protection
|
|
Fire protection products spray-applied to the structural steel frame, encasing and insulating the steel and protecting the building in the event of fire.
|
|
Local contractors and specialty subcontractors and applicators; building materials distributors; industrial manufacturers; architects and structural engineers
|
|
MONOKOTE
®
|
Specialty grouts and mortars
|
|
Cementitious grouts and mortars used for under filling and gap filling
|
|
Specialty contractors engaged in the repair of concrete, installation of new precast concrete elements and infrastructure repair
|
|
BETEC
®
|
Products for architectural concrete
|
|
Products for architectural concrete include surface retarders, coatings, pigments and release agents used by concrete producers and contractors to enhance the surface appearance and aesthetics of concrete
|
|
Precast concrete producers and architects
|
|
PIERI
®
|
Year
(In millions)
|
|
Operation of
Facilities and
Waste Disposal
|
|
Capital
Expenditures
|
|
Site
Remediation
|
|
||||||
2012
|
|
$
|
61
|
|
|
$
|
9
|
|
|
$
|
13
|
|
|
2013
|
|
59
|
|
|
17
|
|
|
14
|
|
|
|||
2014
|
|
59
|
|
|
25
|
|
|
12
|
|
|
|||
2015
|
|
61
|
|
|
17
|
|
|
21
|
|
*
|
|||
2016
|
|
62
|
|
|
11
|
|
|
23
|
|
*
|
*
|
Amounts are based on site remediation matters for which sufficient information is available to estimate remediation costs. We do not have sufficient information to estimate all of Grace's possible future remediation costs. As we receive new information, our estimate of remediation costs may change materially.
|
•
|
commercial agreements may be more difficult to enforce and receivables more difficult to collect;
|
•
|
intellectual property rights may be more difficult to enforce;
|
•
|
increased shipping costs, disruptions in shipping or reduced availability of freight transportation;
|
•
|
we may have difficulty transferring our profits or capital from foreign operations to other countries where such funds could be more profitably deployed;
|
•
|
we may experience unexpected adverse changes in export duties, quotas and tariffs and difficulties in obtaining export licenses;
|
•
|
some foreign countries have adopted, and others may impose, additional withholding taxes or adopt other restrictions on foreign trade or investment, including currency exchange and capital controls;
|
•
|
foreign governments may nationalize private enterprises;
|
•
|
our business and profitability in a particular country could be affected by political or economic repercussions on a domestic, country specific or global level from terrorist activities and the response to such activities;
|
•
|
we may be affected by unexpected adverse changes in foreign laws or regulatory requirements; and
|
•
|
unanticipated events, such as geopolitical changes, could adversely affect our foreign operations.
|
•
|
long-term supply contracts;
|
•
|
contracts with customers that permit adjustments for changes in prices of commodity-based materials and energy;
|
•
|
forward buying programs that layer in our expected requirements systematically over time; and
|
•
|
limited use of financial instruments.
|
•
|
reduce or delay planned capital expenditures, research and development spending or acquisitions;
|
•
|
obtain additional financing or restructure or refinance all or a portion of our debt on or before maturity;
|
•
|
sell assets or businesses; and
|
•
|
sell additional equity.
|
•
|
require us to dedicate a substantial portion of our cash flow to debt payments, thereby reducing funds available for working capital, capital expenditures, acquisitions, research and development, distributions to stockholders and other purposes;
|
•
|
restrict us from making strategic acquisitions or taking advantage of favorable business opportunities;
|
•
|
limit our flexibility in planning for, or reacting to, changes in our business and the industries in which we operate;
|
•
|
increase our vulnerability to adverse economic, credit and industry conditions, including recessions;
|
•
|
make it more difficult for us to satisfy our debt service and other obligations;
|
•
|
place us at a competitive disadvantage compared to our competitors that have relatively less debt; and
|
•
|
limit our ability to borrow additional funds, or to dispose of assets to raise funds, if needed, for working capital, capital expenditures, acquisitions, research and development and other purposes.
|
•
|
incur certain liens;
|
•
|
enter into sale and leaseback transactions; and
|
•
|
consolidate, merge or sell all or substantially all of our assets or the assets of our guarantors.
|
•
|
the diversion of management's attention from our existing businesses to integrate the operations and personnel of the acquired or combined business or joint venture;
|
•
|
possible adverse effects on our operating results during the integration process;
|
•
|
failure of the acquired business to achieve expected operational objectives; and
|
•
|
our possible inability to achieve the intended objectives of the transaction.
|
|
Number of Facilities*
|
|||||||||||||
|
North America
|
|
Europe Middle East Africa
|
|
Asia Pacific
|
|
Latin America
|
|
Total
|
|||||
Catalysts Technologies
|
9
|
|
|
3
|
|
|
1
|
|
|
—
|
|
|
13
|
|
Materials Technologies
|
7
|
|
|
10
|
|
|
9
|
|
|
4
|
|
|
30
|
|
Construction Products
|
17
|
|
|
12
|
|
|
23
|
|
|
11
|
|
|
63
|
|
Name and Age
|
|
Office
|
|
First
Elected
|
Alfred E. Festa (55)
|
|
Chairman of the Board and Chief Executive Officer
|
|
01/01/08
06/01/05
|
Hudson La Force III (50)
|
|
Senior Vice President and Chief Financial Officer
|
|
04/01/08
|
Gregory E. Poling (59)
|
|
President and Chief Operating Officer
|
|
11/03/11
|
Elizabeth C. Brown (51)
|
|
Vice President and Chief Human Resources Officer
|
|
01/21/15
|
Keith N. Cole (56)
|
|
Vice President, Government Relations and Environment, Health and Safety
|
|
02/10/14
|
Mark A. Shelnitz (56)
|
|
Vice President, General Counsel and Secretary
|
|
04/27/05
|
•
|
10 days after an acquiring person, composed of an individual or group, has acquired beneficial ownership of 20% or more of the outstanding Company common stock or
|
•
|
10 business days (or a later date fixed by the Board of Directors) after an acquiring person commences (or announces the intention to commence) a tender offer or exchange offer for beneficial ownership of 20% or more of the outstanding Company common stock.
|
•
|
will initially entitle the holder to buy from Grace one hundredth of a share of the Grace Junior Participating Preferred Stock, at an exercise price of $100, subject to adjustment;
|
•
|
will entitle such holder to receive upon exercise, in lieu of shares of Grace junior preferred stock, that number of shares of Company common stock having a market value of two times the exercise price of the right; and
|
•
|
may be exchanged by Grace for one share of Company common stock or one hundredth of a share of Grace junior preferred stock, subject to adjustment.
|
|
|
Total number of shares purchased
(#)
|
|
Average price paid per share
($/share)
|
|
Total number of shares purchased as part of publicly announced plans or programs
(#)
|
|
Approximate dollar value of shares that may yet be purchased under the plans or programs
($ in millions)
|
||||
10/1/2014 - 10/31/2014
|
|
494,307
|
|
|
89.86
|
|
|
494,307
|
|
|
114.7
|
|
11/1/2014 - 11/30/2014
|
|
434,600
|
|
|
95.54
|
|
|
434,600
|
|
|
73.2
|
|
12/1/2014 - 12/31/2014
|
|
515,465
|
|
|
95.60
|
|
|
515,465
|
|
|
23.9
|
|
Total
|
|
1,444,372
|
|
|
93.62
|
|
|
1,444,372
|
|
|
23.9
|
|
|
2009
|
|
2010
|
|
2011
|
|
2012
|
|
2013
|
|
2014
|
||||||||||||
W. R. Grace & Co.
|
$
|
100
|
|
|
$
|
139
|
|
|
$
|
181
|
|
|
$
|
265
|
|
|
$
|
390
|
|
|
$
|
376
|
|
S&P 500 Index
|
100
|
|
|
115
|
|
|
117
|
|
|
136
|
|
|
179
|
|
|
204
|
|
||||||
S&P 1500 Specialty Chemicals
|
100
|
|
|
129
|
|
|
139
|
|
|
192
|
|
|
253
|
|
|
299
|
|
||||||
S&P 1500 Diversified Chemicals
|
100
|
|
|
140
|
|
|
132
|
|
|
159
|
|
|
227
|
|
|
243
|
|
|
Euro Forward Contracts—December 31, 2013
|
||||||
Currency Forward Exchange Agreements
|
2014 Expected Maturity Date
|
|
Fair Value
|
||||
Contract amount
|
$
|
261.3
|
|
|
$
|
(6.9
|
)
|
Average contractual exchange rate
|
1.34
|
|
|
N/A
|
|
|
Commodity Derivatives—December 31, 2014
|
|||||||||||||
Type of Contract
|
Contract Volumes
|
|
Weighted Average Price
|
|
Total Contract Amount
|
|
Fair Value
|
|||||||
Natural gas swaps
|
5.0
|
|
|
$
|
3.54
|
|
|
$
|
17.5
|
|
|
$
|
(2.5
|
)
|
Aluminum swaps
|
1.3
|
|
|
$
|
0.92
|
|
|
$
|
1.2
|
|
|
$
|
(0.1
|
)
|
|
Commodity Derivatives—December 31, 2013
|
|||||||||||||
Type of Contract
|
Contract Volumes
|
|
Weighted Average Price
|
|
Total Contract Amount
|
|
Fair Value
|
|||||||
Natural gas swaps
|
0.3
|
|
|
$
|
4.44
|
|
|
$
|
1.2
|
|
|
$
|
—
|
|
Aluminum swaps
|
1.4
|
|
|
$
|
0.89
|
|
|
$
|
1.2
|
|
|
$
|
(0.1
|
)
|
|
Natural Gas Option Contracts—December 31, 2014
|
|||||||||||
Type of Contract
|
Contract Volumes
|
|
Strike Price
|
|
Futures Trading Price
|
|
Fair Value
|
|||||
Natural gas options
|
0.3
|
|
|
$
|
5.00
|
|
|
$2.88 - 2.95
|
|
$
|
—
|
|
|
Natural Gas Option Contracts—December 31, 2013
|
|||||||||||
Type of Contract
|
Contract Volumes
|
|
Strike Price
|
|
Futures Trading Price
|
|
Fair Value
|
|||||
Natural gas options
|
7.1
|
|
|
$
|
5.00
|
|
|
$4.01 - 4.41
|
|
$
|
—
|
|
•
|
are not statements of fact, but rather are used to allocate risk to one of the parties if the statements prove to be inaccurate;
|
•
|
may have been qualified by disclosures that were made to the other parties in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;
|
•
|
may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and
|
•
|
were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and do not reflect more recent developments.
|
Exhibit No.
|
|
Exhibit
|
|
Location
|
2.1
|
|
Joint Plan of Reorganization of W. R. Grace & Co. and its Debtor Subsidiaries.
|
|
Exhibit 2.01 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
2.2
|
|
Order Confirming Joint Plan of Reorganization.
|
|
Exhibit 2.02 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
2.3
|
|
Asbestos Insurance Transfer Agreement dated as of February 3, 2014, by and between W. R. Grace & Co., W. R. Grace & Co.-Conn. and the other insurance contributors identified therein and the Asbestos PI Trust.
|
|
Exhibit 2.03 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
3.1
|
|
Amended and Restated Certificate of Incorporation.
|
|
Exhibit 3.01 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
3.2
|
|
Amended and Restated By-laws.
|
|
Exhibit 3.01 to Form 8-K (filed 1/23/15) SEC File No.: 001-13953
|
4.1
|
|
Amended and Restated Rights Agreement dated as of March 25, 2008 between W. R. Grace & Co. and Mellon Investor Services LLC, as Rights Agent.
|
|
Exhibit 4.1 to Form 10/A (filed 3/25/08) SEC File No.: 001-13953
|
4.2
|
|
Receivables Purchase Agreement dated as of January 23, 2007 between Grace GmbH & Co. KG and Coface Finanz GmbH.
|
|
Exhibit 4.10 to Form 10-K (filed 3/02/07) SEC File No.: 001-13953
|
4.3
|
|
Credit Agreement dated as of February 3, 2014 by and among W. R. Grace & Co., W. R. Grace & Co.-Conn., Grace GmbH & Co. KG, a Federal Republic of Germany limited partnership, each lender from time to time party thereto, and Goldman Sachs Bank USA, as Administrative Agent.
|
|
Exhibit 4.01 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
Exhibit No.
|
|
Exhibit
|
|
Location
|
4.4
|
|
Deferred Payment Agreement (PI) dated as of February 3, 2014 by and between W. R. Grace & Co.-Conn. and the WRG Asbestos PI Trust.
|
|
Exhibit 4.02 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
4.5
|
|
Guarantee Agreement (PI) dated as of February 3, 2014 by and between W. R. Grace & Co. and the WRG Asbestos PI Trust.
|
|
Exhibit 4.03 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
4.6
|
|
Obligation Termination Agreement dated August 1, 2014, by and between W. R. Grace & Co.-Conn., W. R. Grace & Co. and the WRG Asbestos PI Trust.
|
|
Exhibit 10.1 to Form 8-K (filed 9/9/14) SEC File No.: 001-13953
|
4.7
|
|
Deferred Payment Agreement (PD) dated as of February 3, 2014 by and between W. R. Grace & Co.-Conn. and the WRG Asbestos PD Trust.
|
|
Exhibit 4.04 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
4.8
|
|
Guarantee Agreement (PD) dated as of February 3, 2014 by and between W. R. Grace & Co. and the WRG Asbestos PD Trust.
|
|
Exhibit 4.05 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
4.9
|
|
Deferred Payment Agreement (PD-ZAI) dated as of February 3, 2014 by and between W. R. Grace & Co.-Conn. and the WRG Asbestos PD Trust.
|
|
Exhibit 4.06 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
4.10
|
|
Guarantee Agreement (PD-ZAI) dated as of February 3, 2014 by and between W. R. Grace & Co. and the WRG Asbestos PD Trust.
|
|
Exhibit 4.07 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
4.11
|
|
Share Issuance Agreement dated as of February 3, 2014 by and among W. R. Grace & Co., the WRG Asbestos PD Trust and the WRG Asbestos PI Trust.
|
|
Exhibit 4.08 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
4.12
|
|
Warrant Agreement dated as of February 3, 2014 by and among W. R. Grace & Co., the WRG Asbestos PI Trust and Computershare.
|
|
Exhibit 4.09 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
4.13
|
|
[Warrant] Implementation Letter dated as of October 25, 2012 by and between W. R. Grace & Co., the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants’ Representative and the Official Committee of Equity Security Holders.
|
|
Exhibit 4.10 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
4.14
|
|
[Warrant] Registration Rights Agreement dated as of February 3, 2014 by and between W. R. Grace & Co. and the WRG Asbestos PI Trust.
|
|
Exhibit 4.11 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
4.15
|
|
Indenture, dated as of September 16, 2014, by and among W. R. Grace & Co.—Conn., the guarantors party there to and Wilmington Trust, National Association, as trustee
|
|
Exhibit 4.1 to Form 8-K (filed 9/19/14) SEC File No.: 001-13953
|
4.16
|
|
First Supplemental Indenture, dated as of September 16, 2014, by and among W. R. Grace & Co.—Conn., the guarantors party thereto and Wilmington Trust, National Association, as trustee
|
|
Exhibit 4.2 to Form 8-K (filed 9/19/14) SEC File No.: 001-13953
|
4.17
|
|
Form of 5.125% Note due 2021 (included as Exhibit A-1 to Exhibit 4.2)
|
|
Exhibit 4.3 (included as Exhibit A-1 to Exhibit 4.2) to Form 8-K (filed 9/19/14) SEC File No.: 001-13953
|
4.18
|
|
Form of 5.625% Note due 2024 (included as Exhibit A-2 to Exhibit 4.2)
|
|
Exhibit 4.4 (included as Exhibit A-2 to Exhibit 4.2) to Form 8-K (filed 9/19/14) SEC File No.: 001-13953
|
10.1
|
|
WRG Asbestos PI Trust Agreement dated as of February 3, 2014 by and between W. R. Grace & Co., the Asbestos PI Future Claimants’ Representative, the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Trustees, the Wilmington Trust Company, and the members of the Trust Advisory Committee.
|
|
Exhibit 10.01 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
10.2
|
|
WRG Asbestos Property Damage Settlement Trust Agreement dated as of February 3, 2014 by and between W. R. Grace & Co., the Asbestos PD Future Claimants’ Representative, the Official Committee of Asbestos Property Damage Claimants, the Asbestos PD Trustees, Wilmington Trust Company, and the members of the Zonolite Attic Insulation Trust Advisory Committee.
|
|
Exhibit 10.02 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953
|
10.3
|
|
Settlement Agreement dated December 23, 2013 by and between W. R. Grace & Co. and the other debtors named therein and the holders of Grace's pre-petition credit facilities named therein.
|
|
Exhibit 10.3 to Form 10-K (filed 2/27/14) SEC File No.: 001-13953
|
Exhibit No.
|
|
Exhibit
|
|
Location
|
10.4
|
|
W. R. Grace & Co. 2000 Stock Incentive Plan, as amended.
|
|
Exhibit 10 to Form 10-Q (filed 8/14/00) SEC File No.: 001-13953*
|
10.5
|
|
W. R. Grace & Co. 2011 Stock Incentive Plan.
|
|
Exhibit 10.1 to Form 8-K (filed 4/13/11) SEC File No.: 001-13953*
|
10.6
|
|
W. R. Grace & Co. Amended and Restated 2011 Stock Incentive Plan.
|
|
Exhibit 10.1 to Form 8-K (filed 5/01/13) SEC File No.: 001-13953*
|
10.7
|
|
W. R. Grace & Co. 2014 Stock Incentive Plan.
|
|
Exhibit 10.03 to Form 8-K (filed 2/07/14) SEC File No.: 001-13953*
|
10.8
|
|
Form of Performance-based Unit Agreement.
|
|
Exhibit 10.2 to Form 10-Q (filed 8/02/13) SEC File No.: 001-13953*
|
10.9
|
|
Form of Stock Option Award Agreement.
|
|
Exhibit 10.2 to Form 8-K (filed 4/13/11)
SEC File No.: 001-13953*
|
10.10
|
|
Form of Restricted Stock Award Agreement
|
|
Exhibit 10.4 to Form 8-K (filed 5/8/14)
SEC File No.: 001-13953*
|
10.10
|
|
W. R. Grace & Co. Supplemental Executive Retirement Plan, as amended.
|
|
Exhibit 10.7 to Form 10-K (filed 3/28/02) SEC File No.: 001-13953*
|
10.11
|
|
W. R. Grace & Co. Executive Salary Protection Plan, as amended.
|
|
Exhibit 10.8 to Form 10-K (filed 3/28/02) SEC File No.: 001-13953*
|
10.12
|
|
Form of Executive Severance Agreement between Grace and certain officers.
|
|
Exhibit 10.17 to Form 10-K (filed 3/13/03) SEC File No.: 001-13953*
|
10.13
|
|
Severance Pay Plan for Salaried Employees.
|
|
Exhibit 10.17 to Form 10-K (filed 3/02/07) SEC File No.: 001-13953*
|
10.14
|
|
Form of Retention Agreement between Grace and certain officers (includes enhanced severance provision).
|
|
Exhibit 10.28 to Form 10-K (filed 4/16/01) SEC File No.: 001-13953*
|
10.15
|
|
Annual Incentive Compensation Program.
|
|
Exhibit 10.15 to Form 10-Q (filed 5/8/14) SEC File No.: 001-13953*
|
10.16
|
|
Letter Agreement dated May 27, 2009 between John F. Akers, on behalf of Grace, and Fred Festa (includes enhanced severance provision).
|
|
Exhibit 10.1 to Form 8-K (filed 5/29/09) SEC File No.: 001-13953*
|
10.17
|
|
Letter Agreement dated February 28, 2008 between Fred Festa, on behalf of Grace, and Hudson La Force III (includes enhanced severance provision)
|
|
Exhibit 10.1 to Form 8-K (filed 3/07/08) SEC File No.: 001-13953*
|
10.18
|
|
Letter Agreement dated June 19, 2009 between Fred Festa, on behalf of Grace, and Pamela Wagoner (includes enhanced severance provision).
|
|
Exhibit 10.18 to Form 10-K (filed 2/27/14) SEC File No.: 001-13953*
|
10.19
|
|
Letter Agreement dated September 24, 2014, between Fred Festa, on behalf of Grace, and Pamela K. Wagoner.
|
|
Exhibit 10.1 to Form 10-Q (filed 11/06/14) SEC File No.: 001-13953*
|
10.20
|
|
Letter Agreement dated November 13, 2013, between Fred Festa, on behalf of Grace, and Keith N. Cole
|
|
Filed herewith
|
12
|
|
Computation of Ratio of Earnings to Fixed Charges and Combined Fixed Charges and Preferred Stock Dividends.
|
|
Filed herewith
|
21
|
|
List of Subsidiaries of W. R. Grace & Co.
|
|
Filed herewith
|
23
|
|
Consent of Independent Accountants.
|
|
Filed herewith
|
24
|
|
Powers of Attorney.
|
|
Filed herewith
|
31.(i).1
|
|
Certification of Periodic Report by Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002
|
|
Filed herewith
|
Exhibit No.
|
|
Exhibit
|
|
Location
|
|
31.(i).2
|
|
|
Certification of Periodic Report by Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002
|
|
Filed herewith
|
32
|
|
|
Certification of Periodic Report by Chief Executive Officer and Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act of 2002
|
|
Filed herewith
|
95
|
|
|
Mine Safety Disclosure Exhibit
|
|
Filed herewith
|
101.INS
|
|
|
XBRL Instance Document
|
|
Filed herewith
|
101.SCH
|
|
|
XBRL Taxonomy Extension Schema
|
|
Filed herewith
|
101.CAL
|
|
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
Filed herewith
|
101.DEF
|
|
|
XBRL Taxonomy Extension Definition Linkbase
|
|
Filed herewith
|
101.LAB
|
|
|
XBRL Taxonomy Extension Label Linkbase
|
|
Filed herewith
|
101.PRE
|
|
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
Filed herewith
|
*
|
Management contracts and compensatory plans, contracts or arrangements required to be filed as exhibits to this Report.
|
|
W. R. GRACE & CO.
|
|
|
By:
|
/s/ A. E. FESTA
|
|
|
A. E. Festa
(Chairman and Chief Executive Officer)
|
|
By:
|
/s/ HUDSON LA FORCE III
|
|
|
Hudson La Force III
(Senior Vice President and
Chief Financial Officer)
|
|
By:
|
/s/ WILLIAM C. DOCKMAN
|
|
|
William C. Dockman
(Vice President and Controller)
|
Signature
|
|
|
|
Title
|
H. F. Baldwin*
|
|
}
|
|
|
R. C. Cambre*
|
|
}
|
|
|
R. F. Cummings, Jr.*
|
|
}
|
|
|
M. A. Fox*
|
|
}
|
|
|
D. H. Gulyas*
|
|
}
|
|
Directors
|
J. K. Henry*
|
|
}
|
|
|
J. N. Quinn*
|
|
}
|
|
|
C. J. Steffen*
|
|
}
|
|
|
M. E. Tomkins*
|
|
}
|
|
|
/s/ A. E. FESTA
|
|
Chairman, Chief Executive Officer and Director (Principal Executive Officer)
|
(A. E. Festa)
|
|
|
/s/ HUDSON LA FORCE III
|
|
Senior Vice President and Chief Financial Officer (Principal Financial Officer)
|
(Hudson La Force III)
|
|
|
/s/ WILLIAM C. DOCKMAN
|
|
Vice President and Controller
(Principal Accounting Officer)
|
(William C. Dockman)
|
|
*
|
By signing his name hereto, Mark A. Shelnitz is signing this document on behalf of each of the persons indicated above pursuant to powers of attorney duly executed by such persons and filed with the Securities and Exchange Commission.
|
|
By:
|
/s/ MARK A. SHELNITZ
|
|
|
Mark A. Shelnitz
(Attorney-in-Fact)
|
|
||
|
/s/ A. E. FESTA
|
|
/s/ HUDSON LA FORCE III
|
A. E. Festa
Chief Executive Officer
|
|
Hudson La Force III
Senior Vice President and
Chief Financial Officer
|
February 25, 2015
|
|
|
|
Year Ended December 31,
|
||||||||||
(In millions, except per share amounts)
|
2014
|
|
2013
|
|
2012
|
||||||
Net sales
|
$
|
3,243.0
|
|
|
$
|
3,060.7
|
|
|
$
|
3,155.5
|
|
Cost of goods sold
|
2,050.6
|
|
|
1,918.6
|
|
|
2,041.1
|
|
|||
Gross profit
|
1,192.4
|
|
|
1,142.1
|
|
|
1,114.4
|
|
|||
Selling, general and administrative expenses
|
664.0
|
|
|
505.7
|
|
|
635.2
|
|
|||
Research and development expenses
|
79.5
|
|
|
65.2
|
|
|
64.5
|
|
|||
Interest expense and related financing costs
|
61.5
|
|
|
43.8
|
|
|
46.5
|
|
|||
Interest accretion on deferred payment obligations
|
65.7
|
|
|
—
|
|
|
—
|
|
|||
Gain on termination of postretirement plans
|
(39.5
|
)
|
|
—
|
|
|
—
|
|
|||
Chapter 11 expenses, net of interest income
|
11.0
|
|
|
15.3
|
|
|
16.6
|
|
|||
Default interest settlement
|
—
|
|
|
129.0
|
|
|
—
|
|
|||
Asbestos and bankruptcy-related charges, net
|
7.1
|
|
|
21.9
|
|
|
384.6
|
|
|||
Equity in earnings of unconsolidated affiliate
|
(19.7
|
)
|
|
(22.9
|
)
|
|
(18.5
|
)
|
|||
Other expense, net
|
28.5
|
|
|
23.5
|
|
|
6.1
|
|
|||
Total costs and expenses
|
858.1
|
|
|
781.5
|
|
|
1,135.0
|
|
|||
Income (loss) before income taxes
|
334.3
|
|
|
360.6
|
|
|
(20.6
|
)
|
|||
Benefit from (provision for) income taxes
|
(57.0
|
)
|
|
(102.9
|
)
|
|
61.6
|
|
|||
Net income
|
277.3
|
|
|
257.7
|
|
|
41.0
|
|
|||
Less: Net income attributable to noncontrolling interests
|
(1.0
|
)
|
|
(1.6
|
)
|
|
(1.0
|
)
|
|||
Net income attributable to W. R. Grace & Co. shareholders
|
$
|
276.3
|
|
|
$
|
256.1
|
|
|
$
|
40.0
|
|
Earnings Per Share Attributable to W. R. Grace & Co. Shareholders
|
|
|
|
|
|
||||||
Basic earnings per share:
|
|
|
|
|
|
||||||
Net income attributable to W. R. Grace & Co. shareholders
|
$
|
3.67
|
|
|
$
|
3.35
|
|
|
$
|
0.53
|
|
Weighted average number of basic shares
|
75.3
|
|
|
76.4
|
|
|
74.9
|
|
|||
Diluted earnings per share:
|
|
|
|
|
|
||||||
Net income attributable to W. R. Grace & Co. shareholders
|
$
|
3.63
|
|
|
$
|
3.30
|
|
|
$
|
0.52
|
|
Weighted average number of diluted shares
|
76.2
|
|
|
77.7
|
|
|
76.3
|
|
|
Year Ended December 31,
|
||||||||||
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Net income
|
$
|
277.3
|
|
|
$
|
257.7
|
|
|
$
|
41.0
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Defined benefit pension and other postretirement plans, net of income taxes
|
(2.6
|
)
|
|
4.6
|
|
|
2.3
|
|
|||
Currency translation adjustments
|
(28.0
|
)
|
|
(23.6
|
)
|
|
5.5
|
|
|||
Gain (loss) from hedging activities, net of income taxes
|
(4.5
|
)
|
|
(0.2
|
)
|
|
2.4
|
|
|||
Other than temporary impairment of investment
|
0.8
|
|
|
—
|
|
|
—
|
|
|||
Gain (loss) on securities available for sale, net of income taxes
|
(0.1
|
)
|
|
0.1
|
|
|
—
|
|
|||
Total other comprehensive income (loss) attributable to noncontrolling interests
|
(2.2
|
)
|
|
(0.9
|
)
|
|
0.8
|
|
|||
Total other comprehensive income (loss)
|
(36.6
|
)
|
|
(20.0
|
)
|
|
11.0
|
|
|||
Comprehensive income
|
240.7
|
|
|
237.7
|
|
|
52.0
|
|
|||
Less: comprehensive (income) loss attributable to noncontrolling interests
|
1.2
|
|
|
(0.7
|
)
|
|
(1.8
|
)
|
|||
Comprehensive income attributable to W. R. Grace & Co. shareholders
|
$
|
241.9
|
|
|
$
|
237.0
|
|
|
$
|
50.2
|
|
|
Year Ended December 31,
|
||||||||||
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
||||||
Net income
|
$
|
277.3
|
|
|
$
|
257.7
|
|
|
$
|
41.0
|
|
Reconciliation to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
137.1
|
|
|
123.1
|
|
|
119.0
|
|
|||
Equity in earnings of unconsolidated affiliate
|
(19.7
|
)
|
|
(22.9
|
)
|
|
(18.5
|
)
|
|||
Dividends received from unconsolidated affiliate
|
11.2
|
|
|
2.8
|
|
|
6.3
|
|
|||
Chapter 11 expenses, net of interest income
|
11.0
|
|
|
15.3
|
|
|
16.6
|
|
|||
Chapter 11 expenses paid
|
(31.6
|
)
|
|
(15.0
|
)
|
|
(15.5
|
)
|
|||
Asbestos and bankruptcy-related charges, net
|
7.1
|
|
|
21.9
|
|
|
384.6
|
|
|||
Cash paid to resolve liabilities subject to Chapter 11
|
(1,316.5
|
)
|
|
—
|
|
|
—
|
|
|||
Cash paid to settle deferred payment obligation
|
(632.0
|
)
|
|
—
|
|
|
—
|
|
|||
Provision for (benefit from) income taxes
|
57.0
|
|
|
102.9
|
|
|
(61.6
|
)
|
|||
Income taxes paid, net of refunds
|
(34.4
|
)
|
|
(60.4
|
)
|
|
(82.6
|
)
|
|||
Excess tax benefits from stock-based compensation
|
(1.2
|
)
|
|
35.4
|
|
|
(36.8
|
)
|
|||
Interest accretion on deferred payment obligations
|
65.7
|
|
|
—
|
|
|
—
|
|
|||
Interest accrued on credit arrangements
|
23.3
|
|
|
38.1
|
|
|
40.4
|
|
|||
Interest paid on credit arrangements
|
(28.4
|
)
|
|
(5.5
|
)
|
|
(4.1
|
)
|
|||
Default interest settlement
|
—
|
|
|
129.0
|
|
|
—
|
|
|||
Defined benefit pension (income) expense
|
160.3
|
|
|
(23.2
|
)
|
|
149.6
|
|
|||
Payments under defined benefit pension arrangements
|
(100.0
|
)
|
|
(68.3
|
)
|
|
(126.8
|
)
|
|||
Expenditures for environmental remediation
|
(12.4
|
)
|
|
(14.0
|
)
|
|
(13.0
|
)
|
|||
Changes in assets and liabilities, excluding effect of currency translation and businesses acquired:
|
|
|
|
|
|
||||||
Trade accounts receivable
|
(25.8
|
)
|
|
13.5
|
|
|
(3.0
|
)
|
|||
Inventories
|
(52.1
|
)
|
|
8.6
|
|
|
53.2
|
|
|||
Accounts payable
|
(17.2
|
)
|
|
4.2
|
|
|
(11.7
|
)
|
|||
All other items, net
|
49.2
|
|
|
(27.3
|
)
|
|
16.5
|
|
|||
Net cash (used for) provided by operating activities
|
(1,472.1
|
)
|
|
515.9
|
|
|
453.6
|
|
|||
INVESTING ACTIVITIES
|
|
|
|
|
|
||||||
Capital expenditures
|
(169.8
|
)
|
|
(156.2
|
)
|
|
(138.5
|
)
|
|||
Businesses acquired, net of cash acquired
|
—
|
|
|
(526.2
|
)
|
|
(80.0
|
)
|
|||
Transfer from (to) restricted cash and cash equivalents
|
395.4
|
|
|
(197.8
|
)
|
|
(61.1
|
)
|
|||
Other investing activities
|
9.7
|
|
|
(0.5
|
)
|
|
(0.7
|
)
|
|||
Net cash provided by (used for) investing activities
|
235.3
|
|
|
(880.7
|
)
|
|
(280.3
|
)
|
|||
FINANCING ACTIVITIES
|
|
|
|
|
|
||||||
Borrowings under credit arrangements
|
1,123.4
|
|
|
57.5
|
|
|
68.9
|
|
|||
Repayments under credit arrangements
|
(770.3
|
)
|
|
(69.4
|
)
|
|
(28.7
|
)
|
|||
Proceeds from issuance of bonds
|
1,000.0
|
|
|
—
|
|
|
—
|
|
|||
Payments for debt financing costs
|
(46.6
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from exercise of stock options
|
23.4
|
|
|
34.4
|
|
|
32.2
|
|
|||
Payments for repurchases of common stock
|
(469.5
|
)
|
|
—
|
|
|
—
|
|
|||
Excess tax benefits from stock-based compensation
|
1.2
|
|
|
(35.4
|
)
|
|
36.8
|
|
|||
Purchase of interest in consolidated joint venture
|
(12.4
|
)
|
|
—
|
|
|
—
|
|
|||
Other financing activities
|
0.7
|
|
|
4.5
|
|
|
1.1
|
|
|||
Net cash provided by (used for) financing activities
|
849.9
|
|
|
(8.4
|
)
|
|
110.3
|
|
|||
Effect of currency exchange rate changes on cash and cash equivalents
|
(20.4
|
)
|
|
1.1
|
|
|
5.0
|
|
|||
(Decrease) increase in cash and cash equivalents
|
(407.3
|
)
|
|
(372.1
|
)
|
|
288.6
|
|
|||
Cash and cash equivalents, beginning of period
|
964.8
|
|
|
1,336.9
|
|
|
1,048.3
|
|
|||
Cash and cash equivalents, end of period
|
$
|
557.5
|
|
|
$
|
964.8
|
|
|
$
|
1,336.9
|
|
|
|
|
|
|
|
||||||
Supplemental disclosure of cash flow information
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
696.5
|
|
|
$
|
5.5
|
|
|
$
|
4.1
|
|
(In millions, except par value and shares)
|
December 31, 2014
|
|
December 31, 2013
|
||||
ASSETS
|
|
|
|
||||
Current Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
557.5
|
|
|
$
|
964.8
|
|
Restricted cash and cash equivalents
|
—
|
|
|
395.4
|
|
||
Trade accounts receivable, less allowance of $5.8 (2013—$6.0)
|
481.1
|
|
|
481.8
|
|
||
Inventories
|
332.8
|
|
|
295.3
|
|
||
Deferred income taxes
|
235.4
|
|
|
58.1
|
|
||
Other current assets
|
84.1
|
|
|
99.0
|
|
||
Total Current Assets
|
1,690.9
|
|
|
2,294.4
|
|
||
Properties and equipment, net of accumulated depreciation and amortization of $1,818.4 (2013—$1,876.8)
|
833.5
|
|
|
829.9
|
|
||
Goodwill
|
452.9
|
|
|
457.5
|
|
||
Technology and other intangible assets, net
|
288.0
|
|
|
315.5
|
|
||
Deferred income taxes
|
612.0
|
|
|
845.9
|
|
||
Asbestos-related insurance
|
—
|
|
|
500.0
|
|
||
Overfunded defined benefit pension plans
|
44.1
|
|
|
16.7
|
|
||
Investment in unconsolidated affiliate
|
113.1
|
|
|
96.2
|
|
||
Other assets
|
60.7
|
|
|
40.0
|
|
||
Total Assets
|
$
|
4,095.2
|
|
|
$
|
5,396.1
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Liabilities Not Subject to Compromise
|
|
|
|
||||
Current Liabilities
|
|
|
|
||||
Debt payable within one year
|
$
|
96.8
|
|
|
$
|
81.1
|
|
Accounts payable
|
255.3
|
|
|
262.5
|
|
||
PI warrant liability
|
490.0
|
|
|
—
|
|
||
Other current liabilities
|
340.0
|
|
|
292.0
|
|
||
Total Current Liabilities
|
1,182.1
|
|
|
635.6
|
|
||
Debt payable after one year
|
1,919.0
|
|
|
29.6
|
|
||
Deferred income taxes
|
19.3
|
|
|
18.2
|
|
||
Income tax contingencies
|
24.0
|
|
|
5.0
|
|
||
Underfunded and unfunded defined benefit pension plans
|
457.5
|
|
|
299.6
|
|
||
Other liabilities
|
124.3
|
|
|
60.8
|
|
||
Total Liabilities Not Subject to Compromise
|
3,726.2
|
|
|
1,048.8
|
|
||
Liabilities Subject to Compromise—Note 2
|
—
|
|
|
3,776.1
|
|
||
Total Liabilities
|
3,726.2
|
|
|
4,824.9
|
|
||
Commitments and Contingencies—Note 11
|
|
|
|
||||
Equity
|
|
|
|
||||
Common stock issued, par value $0.01; 300,000,000 shares authorized; outstanding: 72,922,565 (2013—77,046,143)
|
0.7
|
|
|
0.8
|
|
||
Paid-in capital
|
526.1
|
|
|
533.4
|
|
||
Retained earnings
|
292.1
|
|
|
15.8
|
|
||
Treasury stock, at cost: shares: 4,524,688 (2013—0)
|
(429.2
|
)
|
|
—
|
|
||
Accumulated other comprehensive (loss) income
|
(23.8
|
)
|
|
10.6
|
|
||
Total W. R. Grace & Co. Shareholders' Equity
|
365.9
|
|
|
560.6
|
|
||
Noncontrolling interests
|
3.1
|
|
|
10.6
|
|
||
Total Equity
|
369.0
|
|
|
571.2
|
|
||
Total Liabilities and Equity
|
$
|
4,095.2
|
|
|
$
|
5,396.1
|
|
(In millions)
|
Common
Stock and
Paid-in
Capital
|
|
Retained
Earnings
(Accumulated
Deficit)
|
|
Treasury
Stock
|
|
Accumulated
Other
Comprehensive
(Loss) Income
|
|
Noncontrolling
Interests
|
|
Total
Equity
|
||||||||||||
Balance, December 31, 2011
|
$
|
473.6
|
|
|
$
|
(280.3
|
)
|
|
$
|
(36.8
|
)
|
|
$
|
19.5
|
|
|
$
|
8.1
|
|
|
$
|
184.1
|
|
Net income
|
—
|
|
|
40.0
|
|
|
—
|
|
|
—
|
|
|
1.0
|
|
|
41.0
|
|
||||||
Stock based compensation
|
14.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14.7
|
|
||||||
Exercise of stock options
|
12.2
|
|
|
—
|
|
|
20.0
|
|
|
—
|
|
|
—
|
|
|
32.2
|
|
||||||
Tax benefit related to stock plans
|
36.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
36.8
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
10.2
|
|
|
0.8
|
|
|
11.0
|
|
||||||
Balance, December 31, 2012
|
537.3
|
|
|
(240.3
|
)
|
|
(16.8
|
)
|
|
29.7
|
|
|
9.9
|
|
|
319.8
|
|
||||||
Net income
|
—
|
|
|
256.1
|
|
|
—
|
|
|
—
|
|
|
1.6
|
|
|
257.7
|
|
||||||
Stock based compensation
|
13.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13.4
|
|
||||||
Exercise of stock options
|
17.6
|
|
|
—
|
|
|
16.8
|
|
|
—
|
|
|
—
|
|
|
34.4
|
|
||||||
Tax benefit related to stock plans
|
(35.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(35.4
|
)
|
||||||
Shares issued
|
1.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.3
|
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(19.1
|
)
|
|
(0.9
|
)
|
|
(20.0
|
)
|
||||||
Balance, December 31, 2013
|
534.2
|
|
|
15.8
|
|
|
—
|
|
|
10.6
|
|
|
10.6
|
|
|
571.2
|
|
||||||
Net income
|
—
|
|
|
276.3
|
|
|
—
|
|
|
—
|
|
|
1.0
|
|
|
277.3
|
|
||||||
Repurchase of common stock
|
(0.1
|
)
|
|
—
|
|
|
(469.4
|
)
|
|
—
|
|
|
—
|
|
|
(469.5
|
)
|
||||||
Stock based compensation
|
12.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12.5
|
|
||||||
Exercise of stock options
|
(16.8
|
)
|
|
—
|
|
|
40.2
|
|
|
—
|
|
|
—
|
|
|
23.4
|
|
||||||
Purchase of noncontrolling interest
|
(6.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6.3
|
)
|
|
(12.4
|
)
|
||||||
Tax benefit related to stock plans
|
1.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.2
|
|
||||||
Shares issued
|
1.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.9
|
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(34.4
|
)
|
|
(2.2
|
)
|
|
(36.6
|
)
|
||||||
Balance, December 31, 2014
|
$
|
526.8
|
|
|
$
|
292.1
|
|
|
$
|
(429.2
|
)
|
|
$
|
(23.8
|
)
|
|
$
|
3.1
|
|
|
$
|
369.0
|
|
•
|
Contingent liabilities, which depend on an assessment of the probability of loss and an estimate of ultimate resolution cost, such as litigation (see Note 2), income taxes (see Note 8), and environmental remediation (see Note 11);
|
•
|
Pension and postretirement liabilities that depend on assumptions regarding participant life spans, future inflation, discount rates and total returns on invested funds (see Note 9); and
|
•
|
Realization values of net deferred tax assets, which depend on projections of future taxable income (see Note 8).
|
•
|
$557.7 million
in cash from Grace (includes
$464.1 million
of cash from Grace and
$93.6 million
of cash from insurance proceeds that were held in escrow);
|
•
|
A warrant to acquire
10 million
shares of Company common stock at an exercise price of
$17.00
per share and expiring one year after the Effective Date (the "PI Warrant") (The Company repurchased the PI Warrant for a payment of
$490 million
in cash on February 3, 2015);
|
•
|
Rights to all proceeds under all of Grace's insurance policies that are available for payment of PI Claims;
|
•
|
$42.1
million in cash from a subsidiary of Fresenius AG, pursuant to the terms of a settlement agreement resolving asbestos-related, successor liability and fraudulent transfer claims against Fresenius; and
|
•
|
$856.8
million in cash and
18 million
shares of Sealed Air Corporation common stock paid by Cryovac, Inc., a wholly owned subsidiary of Sealed Air, pursuant to the terms of a settlement agreement resolving asbestos-related, successor liability and fraudulent transfer claims against Cryovac and Sealed Air.
|
(In millions)
|
December 31, 2013
|
|
Filing Date
(Unaudited)
|
||||
Asbestos-related contingencies
|
$
|
2,092.4
|
|
|
$
|
1,002.8
|
|
Pre-petition bank debt plus accrued interest
|
1,100.0
|
|
|
511.5
|
|
||
Environmental contingencies
|
134.5
|
|
|
164.8
|
|
||
Unfunded special pension arrangements
|
129.4
|
|
|
70.8
|
|
||
Income tax contingencies
|
76.6
|
|
|
242.1
|
|
||
Postretirement benefits other than pension
|
57.2
|
|
|
185.4
|
|
||
Drawn letters of credit plus accrued interest
|
37.8
|
|
|
—
|
|
||
Accounts payable
|
34.3
|
|
|
43.0
|
|
||
Retained obligations of divested businesses
|
29.9
|
|
|
43.5
|
|
||
Other accrued liabilities
|
94.3
|
|
|
102.1
|
|
||
Reclassification to current liabilities(1)
|
(10.3
|
)
|
|
—
|
|
||
Total Liabilities Subject to Compromise
|
$
|
3,776.1
|
|
|
$
|
2,366.0
|
|
(1)
|
As of December 31,
2013
, approximately
$10.3 million
of certain pension and postretirement benefit obligations subject to compromise have been presented in "other current liabilities" in the Consolidated Balance Sheets in accordance with ASC 715 "Compensation—Retirement Benefits."
|
|
Year Ended December 31,
|
||||||||||
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Legal and financial advisory fees
|
$
|
11.1
|
|
|
$
|
17.1
|
|
|
$
|
17.4
|
|
Interest income
|
(0.1
|
)
|
|
(1.8
|
)
|
|
(0.8
|
)
|
|||
Chapter 11 expenses, net of interest income
|
$
|
11.0
|
|
|
$
|
15.3
|
|
|
$
|
16.6
|
|
|
Year Ended December 31,
|
||||||
(In millions) (Unaudited)
|
2013
|
|
2012
|
||||
Net sales, including intercompany
|
$
|
1,425.4
|
|
|
$
|
1,512.6
|
|
Cost of goods sold, including intercompany, exclusive of depreciation and amortization shown separately below
|
882.2
|
|
|
951.3
|
|
||
Selling, general and administrative expenses
|
178.1
|
|
|
274.9
|
|
||
Depreciation and amortization
|
69.1
|
|
|
67.3
|
|
||
Chapter 11 expenses, net of interest income
|
15.3
|
|
|
16.6
|
|
||
Default interest settlement
|
129.0
|
|
|
—
|
|
||
Asbestos and bankruptcy-related charges, net
|
21.9
|
|
|
384.6
|
|
||
Research and development expenses
|
37.8
|
|
|
35.9
|
|
||
Interest expense and related financing costs
|
37.7
|
|
|
41.5
|
|
||
Other income, net
|
(75.7
|
)
|
|
(93.2
|
)
|
||
|
1,295.4
|
|
|
1,678.9
|
|
||
Income (loss) before income taxes and equity in net income of non-filing entities
|
130.0
|
|
|
(166.3
|
)
|
||
Benefit from (provision for) income taxes
|
(53.2
|
)
|
|
48.4
|
|
||
Income (loss) before equity in net income of non-filing entities
|
76.8
|
|
|
(117.9
|
)
|
||
Equity in net income of non-filing entities
|
179.3
|
|
|
157.9
|
|
||
Net income attributable to W. R. Grace & Co. shareholders
|
$
|
256.1
|
|
|
$
|
40.0
|
|
|
Year Ended December 31,
|
||||||
(In millions) (Unaudited)
|
2013
|
|
2012
|
||||
OPERATING ACTIVITIES
|
|
|
|
||||
Net income attributable to W. R. Grace & Co. shareholders
|
$
|
256.1
|
|
|
$
|
40.0
|
|
Reconciliation to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
69.1
|
|
|
67.3
|
|
||
Asbestos and bankruptcy-related charges, net
|
21.9
|
|
|
384.6
|
|
||
Default interest settlement
|
129.0
|
|
|
—
|
|
||
Equity in net income of non-filing entities
|
(179.3
|
)
|
|
(157.9
|
)
|
||
Provision for (benefit from) income taxes
|
53.2
|
|
|
(48.4
|
)
|
||
Income taxes (paid), net of refunds
|
13.5
|
|
|
(33.9
|
)
|
||
Tax benefits from stock-based compensation
|
35.4
|
|
|
(36.8
|
)
|
||
Defined benefit pension (income) expense
|
(51.8
|
)
|
|
82.0
|
|
||
Payments under defined benefit pension arrangements
|
(55.6
|
)
|
|
(114.9
|
)
|
||
Repatriation of cash from foreign entities
|
29.7
|
|
|
21.6
|
|
||
Changes in assets and liabilities, excluding the effect of foreign currency translation and business acquired:
|
|
|
|
||||
Trade accounts receivable
|
(6.2
|
)
|
|
(7.1
|
)
|
||
Inventories
|
(23.0
|
)
|
|
66.7
|
|
||
Accounts payable
|
21.9
|
|
|
(15.1
|
)
|
||
All other items, net
|
31.1
|
|
|
75.9
|
|
||
Net cash provided by operating activities
|
345.0
|
|
|
324.0
|
|
||
INVESTING ACTIVITIES
|
|
|
|
||||
Capital expenditures
|
(94.1
|
)
|
|
(82.6
|
)
|
||
Business acquired, net of cash acquired
|
(510.4
|
)
|
|
—
|
|
||
Transfer to restricted cash and cash equivalents
|
(222.2
|
)
|
|
(35.4
|
)
|
||
Net cash used for investing activities
|
(826.7
|
)
|
|
(118.0
|
)
|
||
FINANCING ACTIVITIES
|
|
|
|
||||
Borrowings under credit arrangements
|
0.3
|
|
|
—
|
|
||
Repayments under credit arrangements
|
(0.8
|
)
|
|
(0.6
|
)
|
||
Proceeds from exercise of stock options
|
34.4
|
|
|
32.2
|
|
||
Excess tax benefits from stock-based compensation
|
(35.4
|
)
|
|
36.8
|
|
||
Other financing activities
|
4.1
|
|
|
1.2
|
|
||
Net cash provided by financing activities
|
2.6
|
|
|
69.6
|
|
||
(Decrease) increase in cash and cash equivalents
|
(479.1
|
)
|
|
275.6
|
|
||
Cash and cash equivalents, beginning of period
|
1,064.2
|
|
|
788.6
|
|
||
Cash and cash equivalents, end of period
|
$
|
585.1
|
|
|
$
|
1,064.2
|
|
(In millions) (Unaudited)
|
December 31, 2013
|
||
ASSETS
|
|
||
Current Assets
|
|
||
Cash and cash equivalents
|
$
|
585.1
|
|
Restricted cash and cash equivalents
|
340.5
|
|
|
Trade accounts receivable, net
|
149.7
|
|
|
Receivables from non-filing entities, net
|
173.0
|
|
|
Inventories
|
138.9
|
|
|
Other current assets
|
69.3
|
|
|
Total Current Assets
|
1,456.5
|
|
|
Properties and equipment, net
|
484.5
|
|
|
Goodwill
|
279.9
|
|
|
Technology and other intangible assets, net
|
249.1
|
|
|
Deferred income taxes
|
817.3
|
|
|
Asbestos-related insurance
|
500.0
|
|
|
Loans receivable from non-filing entities, net
|
283.8
|
|
|
Investment in non-filing entities
|
531.3
|
|
|
Investment in unconsolidated affiliate
|
96.2
|
|
|
Other assets
|
16.5
|
|
|
Total Assets
|
$
|
4,715.1
|
|
LIABILITIES AND EQUITY
|
|
||
Liabilities Not Subject to Compromise
|
|
||
Current liabilities
|
$
|
247.4
|
|
Underfunded defined benefit pension plans
|
52.2
|
|
|
Other liabilities
|
78.7
|
|
|
Total Liabilities Not Subject to Compromise
|
378.3
|
|
|
Liabilities Subject to Compromise
|
3,776.1
|
|
|
Total Liabilities
|
4,154.4
|
|
|
Total W. R. Grace & Co. Shareholders' Equity
|
560.6
|
|
|
Noncontrolling interests in Chapter 11 filing entities
|
0.1
|
|
|
Total Equity
|
560.7
|
|
|
Total Liabilities and Equity
|
$
|
4,715.1
|
|
|
December 31,
|
||||||
(In millions)
|
2014
|
|
2013
|
||||
Raw materials
|
$
|
78.8
|
|
|
$
|
69.7
|
|
In process
|
47.2
|
|
|
41.8
|
|
||
Finished products
|
177.7
|
|
|
152.4
|
|
||
Other
|
29.1
|
|
|
31.4
|
|
||
|
$
|
332.8
|
|
|
$
|
295.3
|
|
|
December 31,
|
||||||
(In millions)
|
2014
|
|
2013
|
||||
Land
|
$
|
18.5
|
|
|
$
|
20.0
|
|
Buildings
|
530.0
|
|
|
524.3
|
|
||
Information technology and equipment
|
175.6
|
|
|
172.0
|
|
||
Machinery, equipment and other
|
1,825.3
|
|
|
1,883.2
|
|
||
Projects under construction
|
102.5
|
|
|
107.2
|
|
||
Properties and equipment, gross
|
2,651.9
|
|
|
2,706.7
|
|
||
Accumulated depreciation and amortization
|
(1,818.4
|
)
|
|
(1,876.8
|
)
|
||
Properties and equipment, net
|
$
|
833.5
|
|
|
$
|
829.9
|
|
(In millions)
|
Grace Catalysts Technologies
|
|
Grace Materials Technologies
|
|
Grace
Construction
Products
|
|
Total
Grace
|
||||||||
Balance, December 31, 2013
|
$
|
293.4
|
|
|
$
|
41.2
|
|
|
$
|
122.9
|
|
|
$
|
457.5
|
|
Foreign currency translation
|
(0.9
|
)
|
|
(2.3
|
)
|
|
(10.8
|
)
|
|
(14.0
|
)
|
||||
Other adjustments
|
1.3
|
|
|
11.5
|
|
|
(3.4
|
)
|
|
9.4
|
|
||||
Balance, December 31, 2014
|
$
|
293.8
|
|
|
$
|
50.4
|
|
|
$
|
108.7
|
|
|
$
|
452.9
|
|
|
(In millions)
|
||
2015
|
$
|
21.9
|
|
2016
|
18.4
|
|
|
2017
|
17.1
|
|
|
2018
|
16.9
|
|
|
2019
|
15.0
|
|
|
Thereafter
|
194.5
|
|
|
Total estimated amortization expense
|
$
|
283.8
|
|
|
December 31,
|
||||||
(In millions)
|
2014
|
|
2013
|
||||
5.125% senior notes due 2021
|
$
|
700.0
|
|
|
$
|
—
|
|
U.S. dollar term loan, net of unamortized discount of $2.1 at December 31, 2014
|
692.6
|
|
|
—
|
|
||
5.625% senior notes due 2024
|
300.0
|
|
|
—
|
|
||
Euro term loan, net of unamortized discount of $0.4 at December 31, 2014
|
181.2
|
|
|
—
|
|
||
Debt payable—unconsolidated affiliate
|
31.5
|
|
|
28.8
|
|
||
Deferred payment obligation
|
28.2
|
|
|
—
|
|
||
Other borrowings(1)
|
82.3
|
|
|
81.9
|
|
||
Total debt
|
2,015.8
|
|
|
110.7
|
|
||
Debt payable within one year
|
96.8
|
|
|
81.1
|
|
||
Debt payable after one year
|
$
|
1,919.0
|
|
|
$
|
29.6
|
|
Debt Subject to Compromise
|
|
|
|
||||
Bank borrowings(2)
|
$
|
—
|
|
|
$
|
500.0
|
|
Accrued interest on bank borrowings
|
—
|
|
|
471.0
|
|
||
Default interest settlement(3)
|
—
|
|
|
129.0
|
|
||
Drawn letters of credit
|
—
|
|
|
26.7
|
|
||
Accrued interest on drawn letters of credit
|
—
|
|
|
11.1
|
|
||
|
$
|
—
|
|
|
$
|
1,137.8
|
|
Full-year weighted average interest rates on total debt
|
4.3
|
%
|
|
3.6
|
%
|
(1)
|
Represents borrowings under various lines of credit and other borrowings, primarily by non-U.S. subsidiaries.
|
(2)
|
Under bank revolving credit agreements in effect prior to the Filing, Grace could borrow up to
$500 million
at interest rates based upon the prevailing prime, federal funds and/or Eurodollar rates (
$250 million
under short-term facilities that expired in May 2001 and
$250 million
under a long-term facility that expired in May 2003). As a result of the Filing, Grace was not permitted to make payments under the bank revolving credit agreements, and accordingly, the balance as of the Filing Date was reclassified to debt subject to compromise in the Consolidated Balance Sheets.
|
(3)
|
On December 31, 2013, Grace entered into an agreement to settle the final appeal pending in its Chapter 11 bankruptcy with the holders of the Company’s pre-petition bank debt (the “Bank Lenders”). The settlement called for Grace to pay the Bank Lenders
$129.0 million
, plus interest from December 31, 2013, in addition to the distributions provided in the Joint Plan.
|
(a)
|
a
$700 million
term loan due in 2021, with interest at LIBOR +225 bps with a 75 bps floor;
|
(b)
|
a
€150 million
term loan due in 2021, with interest at EURIBOR +250 bps with a 75 bps floor;
|
(c)
|
a
$400 million
revolving credit facility due in 2019, with interest at LIBOR +175 bps; and
|
(d)
|
a
$250 million
delayed draw term loan facility available for
12 months
, with amounts drawn due in 2021, with interest at LIBOR +225 bps with a 75 bps floor.
|
(a)
|
$700 million
in aggregate principal amount of Notes due 2021 at a coupon rate of
5.125%
, and
|
(b)
|
$300 million
in aggregate principal amount of Notes due 2024 at a coupon rate of
5.625%
.
|
|
December 31, 2014
|
|
December 31, 2013
|
||||||||||||
(In millions)
|
Carrying Amount
|
|
Fair Value
|
|
Carrying Amount
|
|
Fair Value
|
||||||||
5.125% senior notes due 2021
|
$
|
700.0
|
|
|
$
|
720.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
U.S. dollar term loan(1)
|
692.6
|
|
|
691.3
|
|
|
—
|
|
|
—
|
|
||||
5.625% senior notes due 2024
|
300.0
|
|
|
312.0
|
|
|
—
|
|
|
—
|
|
||||
Euro term loan(1)
|
181.2
|
|
|
181.4
|
|
|
—
|
|
|
—
|
|
||||
Other borrowings (not subject to compromise)
|
142.0
|
|
|
142.0
|
|
|
110.7
|
|
|
110.7
|
|
||||
Other borrowings (subject to compromise)
|
—
|
|
|
—
|
|
|
1,137.8
|
|
|
1,137.8
|
|
||||
Total debt
|
$
|
2,015.8
|
|
|
$
|
2,047.6
|
|
|
$
|
1,248.5
|
|
|
$
|
1,248.5
|
|
(1)
|
Carrying amounts are net of unamortized discounts of
$2.1 million
and
$0.4 million
related to the U.S. dollar term loan and Euro term loan, respectively.
|
|
Fair Value Measurements at December 31, 2014, Using
|
||||||||||||||
(In millions)
|
Total
|
|
Quoted Prices in
Active Markets
for Identical
Assets or
Liabilities
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Currency derivatives
|
$
|
3.3
|
|
|
$
|
—
|
|
|
$
|
3.3
|
|
|
$
|
—
|
|
Total Assets
|
$
|
3.3
|
|
|
$
|
—
|
|
|
$
|
3.3
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Currency derivatives
|
$
|
0.1
|
|
|
$
|
—
|
|
|
$
|
0.1
|
|
|
$
|
—
|
|
Interest rate derivatives
|
5.5
|
|
|
—
|
|
|
5.5
|
|
|
—
|
|
||||
Commodity derivatives
|
2.6
|
|
|
—
|
|
|
2.6
|
|
|
—
|
|
||||
Total Liabilities
|
$
|
8.2
|
|
|
$
|
—
|
|
|
$
|
8.2
|
|
|
$
|
—
|
|
|
Fair Value Measurements at December 31, 2013, Using
|
||||||||||||||
(In millions)
|
Total
|
|
Quoted Prices in
Active Markets
for Identical
Assets or
Liabilities
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Currency derivatives
|
$
|
2.1
|
|
|
$
|
—
|
|
|
$
|
2.1
|
|
|
$
|
—
|
|
Total Assets
|
$
|
2.1
|
|
|
$
|
—
|
|
|
$
|
2.1
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Currency derivatives
|
$
|
6.9
|
|
|
$
|
—
|
|
|
$
|
6.9
|
|
|
$
|
—
|
|
Commodity derivatives
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
||||
Total Liabilities
|
$
|
7.0
|
|
|
$
|
—
|
|
|
$
|
7.0
|
|
|
$
|
—
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
December 31, 2014
(In millions)
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
||||
Derivatives designated as hedging instruments under ASC 815:
|
|
|
|
|
|
|
|
||||
Commodity contracts
|
Other current assets
|
|
$
|
—
|
|
|
Other current liabilities
|
|
$
|
2.6
|
|
Currency contracts
|
Other current assets
|
|
0.8
|
|
|
Other current liabilities
|
|
—
|
|
||
Currency contracts
|
Other assets
|
|
0.9
|
|
|
Other liabilities
|
|
—
|
|
||
Interest rate contracts
|
Other current assets
|
|
—
|
|
|
Other current liabilities
|
|
2.5
|
|
||
Interest rate contracts
|
Other assets
|
|
—
|
|
|
Other liabilities
|
|
3.0
|
|
||
Derivatives not designated as hedging instruments under ASC 815:
|
|
|
|
|
|
|
|
||||
Currency contracts
|
Other current assets
|
|
1.6
|
|
|
Other current liabilities
|
|
0.1
|
|
||
Total derivatives
|
|
|
$
|
3.3
|
|
|
|
|
$
|
8.2
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
December 31, 2013
(In millions) |
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
||||
Derivatives designated as hedging instruments under ASC 815:
|
|
|
|
|
|
|
|
||||
Commodity contracts
|
Other current assets
|
|
$
|
—
|
|
|
Other current liabilities
|
|
$
|
0.1
|
|
Currency contracts
|
Other current assets
|
|
1.0
|
|
|
Other current liabilities
|
|
—
|
|
||
Currency contracts
|
Other assets
|
|
1.0
|
|
|
Other liabilities
|
|
—
|
|
||
Derivatives not designated as hedging instruments under ASC 815:
|
|
|
|
|
|
|
|
||||
Currency contracts
|
Other current assets
|
|
0.1
|
|
|
Other current liabilities
|
|
6.9
|
|
||
Total derivatives
|
|
|
$
|
2.1
|
|
|
|
|
$
|
7.0
|
|
Year Ended December 31, 2014
(In millions)
|
Amount of Gain (Loss) Recognized in OCI on Derivatives
(Effective Portion) |
|
Location of Gain (Loss) Reclassified from Accumulated OCI into Income
(Effective Portion) |
|
Amount of Gain (Loss) Reclassified from OCI into Income
(Effective Portion) |
||||
Derivatives in ASC 815 cash flow hedging relationships:
|
|
|
|
|
|
||||
Interest rate contracts
|
$
|
(5.4
|
)
|
|
Interest expense
|
|
$
|
—
|
|
Currency contracts
|
2.1
|
|
|
Other expense
|
|
1.3
|
|
||
Commodity contracts
|
(2.2
|
)
|
|
Cost of goods sold
|
|
0.3
|
|
||
Total derivatives
|
$
|
(5.5
|
)
|
|
|
|
$
|
1.6
|
|
|
|
|
|
|
|
||||
|
|
Location of Gain (Loss) Recognized in Income on Derivatives
|
|
Amount of Gain (Loss) Recognized in Income on Derivatives
|
|||||
Derivatives not designated as hedging instruments under ASC 815:
|
|
|
|
|
|||||
Currency contracts
|
|
Other expense
|
|
$
|
7.1
|
|
Year Ended December 31, 2013
(In millions) |
Amount of Gain (Loss) Recognized in OCI on Derivatives
(Effective Portion) |
|
Location of Gain (Loss) Reclassified from Accumulated OCI into Income
(Effective Portion) |
|
Amount of Gain (Loss) Reclassified from OCI into Income
(Effective Portion) |
||||
Derivatives in ASC 815 cash flow hedging relationships:
|
|
|
|
|
|
||||
Currency contracts
|
$
|
2.0
|
|
|
Other expense
|
|
$
|
2.4
|
|
Currency contracts
|
(0.2
|
)
|
|
Cost of goods sold
|
|
(0.2
|
)
|
||
Commodity contracts
|
(0.3
|
)
|
|
Cost of goods sold
|
|
(0.4
|
)
|
||
Total derivatives
|
$
|
1.5
|
|
|
|
|
$
|
1.8
|
|
|
|
|
|
|
|
||||
|
|
Location of Gain (Loss) Recognized in Income on Derivatives
|
|
Amount of Gain (Loss) Recognized in Income on Derivatives
|
|||||
Derivatives not designated as hedging instruments under ASC 815:
|
|
|
|
|
|||||
Currency contracts
|
|
Other expense
|
|
$
|
(10.9
|
)
|
Year Ended December 31, 2012
(In millions) |
Amount of Gain (Loss) Recognized in OCI on Derivatives
(Effective Portion) |
|
Location of Gain (Loss) Reclassified from Accumulated OCI into Income
(Effective Portion) |
|
Amount of Gain (Loss) Reclassified from OCI into Income
(Effective Portion) |
||||
Derivatives in ASC 815 cash flow hedging relationships:
|
|
|
|
|
|||||
Currency contracts
|
$
|
1.4
|
|
|
Other expense
|
|
$
|
1.6
|
|
Currency contracts
|
0.2
|
|
|
Cost of goods sold
|
|
(0.1
|
)
|
||
Commodity contracts
|
(2.3
|
)
|
|
Cost of goods sold
|
|
(5.9
|
)
|
||
Total derivatives
|
$
|
(0.7
|
)
|
|
|
|
$
|
(4.4
|
)
|
|
|
|
|
|
|
||||
|
|
Location of Gain (Loss) Recognized in Income on Derivatives
|
|
Amount of Gain (Loss) Recognized in Income on Derivatives
|
|||||
Derivatives not designated as hedging instruments under ASC 815:
|
|
|
|
|
|||||
Currency contracts
|
|
Other expense
|
|
$
|
(4.4
|
)
|
Year Ended December 31, 2014
(In millions)
|
Amount of Gain (Loss) Recognized in OCI in Currency Translation Adjustments
(Effective Portion)
|
|
Location of Gain (Loss) Reclassified from Accumulated OCI into Income
(Ineffective Portion)
|
|
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income
(Ineffective Portion)
|
||||
Nonderivatives in ASC 815 net investment hedging relationships:
|
|
|
|
|
|
||||
Foreign currency denominated debt
|
$
|
22.7
|
|
|
Not applicable
|
|
$
|
—
|
|
Total nonderivatives
|
$
|
22.7
|
|
|
|
|
$
|
—
|
|
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Income (loss) before income taxes:
|
|
|
|
|
|
||||||
Domestic
|
$
|
137.5
|
|
|
$
|
141.4
|
|
|
$
|
(170.3
|
)
|
Foreign
|
196.8
|
|
|
219.2
|
|
|
149.7
|
|
|||
Total
|
$
|
334.3
|
|
|
$
|
360.6
|
|
|
$
|
(20.6
|
)
|
Benefit from (provision for) income taxes:
|
|
|
|
|
|
||||||
Federal—current
|
$
|
59.4
|
|
|
$
|
1.4
|
|
|
$
|
(51.2
|
)
|
Federal—deferred
|
(45.8
|
)
|
|
(73.1
|
)
|
|
82.0
|
|
|||
State and local—current
|
(0.7
|
)
|
|
(0.7
|
)
|
|
(4.4
|
)
|
|||
State and local—deferred
|
(17.6
|
)
|
|
38.2
|
|
|
70.2
|
|
|||
Foreign—current
|
(62.5
|
)
|
|
(83.5
|
)
|
|
(43.1
|
)
|
|||
Foreign—deferred
|
10.2
|
|
|
14.8
|
|
|
8.1
|
|
|||
Total
|
$
|
(57.0
|
)
|
|
$
|
(102.9
|
)
|
|
$
|
61.6
|
|
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Tax benefit (provision) at U.S. federal income tax rate
|
$
|
(117.0
|
)
|
|
$
|
(126.2
|
)
|
|
$
|
7.2
|
|
Change in benefit (provision) resulting from:
|
|
|
|
|
|
||||||
Adjustments to uncertain tax positions
|
57.7
|
|
|
(6.8
|
)
|
|
(13.4
|
)
|
|||
Effect of tax rates in foreign jurisdictions
|
17.8
|
|
|
16.6
|
|
|
14.9
|
|
|||
State and local income taxes, net
|
(11.9
|
)
|
|
(0.7
|
)
|
|
0.1
|
|
|||
Nontaxable income/non-deductible expenses
|
(6.0
|
)
|
|
(9.7
|
)
|
|
(8.1
|
)
|
|||
U.S. tax on foreign earnings
|
5.2
|
|
|
3.7
|
|
|
(2.2
|
)
|
|||
Release of state valuation allowance
|
—
|
|
|
24.4
|
|
|
44.0
|
|
|||
Benefits from domestic production activities
|
—
|
|
|
—
|
|
|
14.0
|
|
|||
Other
|
(2.8
|
)
|
|
(4.2
|
)
|
|
5.1
|
|
|||
Benefit from (provision for) income taxes
|
$
|
(57.0
|
)
|
|
$
|
(102.9
|
)
|
|
$
|
61.6
|
|
(In millions)
|
December 31, 2014
|
|
December 31, 2013
|
||||
Deferred tax assets:
|
|
|
|
||||
U.S. net operating loss carryforwards
|
$
|
371.8
|
|
|
$
|
—
|
|
Liability for asbestos-related litigation
|
192.4
|
|
|
700.0
|
|
||
Pension liabilities
|
114.2
|
|
|
100.9
|
|
||
State net operating loss carryforwards
|
51.1
|
|
|
40.4
|
|
||
Federal tax credit carryforwards
|
49.6
|
|
|
16.9
|
|
||
Reserves and allowances
|
45.2
|
|
|
63.9
|
|
||
Research and development
|
34.5
|
|
|
34.7
|
|
||
Liability for environmental remediation
|
22.7
|
|
|
50.2
|
|
||
Foreign net operating loss carryforwards
|
18.0
|
|
|
18.0
|
|
||
Other postretirement benefits
|
1.0
|
|
|
19.4
|
|
||
Accrued interest on pre-petition debt
|
—
|
|
|
71.1
|
|
||
Other
|
45.4
|
|
|
29.9
|
|
||
Total deferred tax assets
|
$
|
945.9
|
|
|
$
|
1,145.4
|
|
Deferred tax liabilities:
|
|
|
|
||||
Properties and equipment
|
$
|
(52.8
|
)
|
|
$
|
(31.1
|
)
|
Intangible assets
|
(36.4
|
)
|
|
(17.5
|
)
|
||
Pension assets
|
(9.4
|
)
|
|
(3.7
|
)
|
||
Asbestos-related insurance receivable
|
—
|
|
|
(186.4
|
)
|
||
Other
|
(8.2
|
)
|
|
(2.7
|
)
|
||
Total deferred tax liabilities
|
$
|
(106.8
|
)
|
|
$
|
(241.4
|
)
|
Valuation allowance:
|
|
|
|
||||
State net operating loss carryforwards
|
$
|
(5.9
|
)
|
|
$
|
(13.6
|
)
|
Foreign net operating loss carryforwards
|
(4.2
|
)
|
|
(0.3
|
)
|
||
Federal tax credit carryforwards
|
(2.4
|
)
|
|
(4.4
|
)
|
||
Total valuation allowance
|
(12.5
|
)
|
|
(18.3
|
)
|
||
Net deferred tax assets
|
$
|
826.6
|
|
|
$
|
885.7
|
|
(In millions)
|
Unrecognized
Tax Benefits
|
||
Balance, January 1, 2012
|
$
|
62.4
|
|
Additions for current year tax positions
|
3.4
|
|
|
Additions for prior year tax positions
|
22.0
|
|
|
Reductions for prior year tax positions and reclassifications
|
(0.8
|
)
|
|
Reductions for expirations of statute of limitations
|
(2.9
|
)
|
|
Settlements(1)
|
(1.0
|
)
|
|
Balance, December 31, 2012
|
83.1
|
|
|
Additions for current year tax positions
|
6.3
|
|
|
Additions for prior year tax positions
|
6.4
|
|
|
Reductions for prior year tax positions and reclassifications(2)
|
(9.6
|
)
|
|
Reductions for expirations of statute of limitations
|
(5.9
|
)
|
|
Balance, December 31, 2013
|
80.3
|
|
|
Additions for current year tax positions
|
0.9
|
|
|
Additions for prior year tax positions
|
11.0
|
|
|
Reductions for prior year tax positions and reclassifications
|
(5.7
|
)
|
|
Reductions for expirations of statute of limitations
|
(0.4
|
)
|
|
Settlements(3)
|
(59.6
|
)
|
|
Balance, December 31, 2014
|
$
|
26.5
|
|
(1)
|
In 2012,
$1.0 million
of unrecognized tax benefits representing withholding taxes due were paid as a result of the completion of Grace's Canadian audit for the years 2002, 2003, and 2004.
|
(2)
|
In 2013,
$9.6 million
of unrecognized tax benefits representing agreed adjustments resulting from the 2007-2009 IRS examination were reclassified to income taxes payable.
|
(3)
|
In 2014,
$59.6 million
of benefits associated with reserves for unrecognized tax benefits were recognized based on the status of examinations in taxing jurisdictions and relevant statutes and regulatory guidance.
|
Tax Jurisdiction(1)
|
Examination in Progress
|
|
Examination Not Initiated
|
United States—Federal
|
None
|
|
2010-2013
|
United States—State
|
2007-2011
|
|
2012-2013
|
Germany
|
None
|
|
2009-2013
|
Italy
|
None
|
|
2008-2013
|
France
|
2010-2011
|
|
2012-2013
|
Canada
|
None
|
|
2006-2013
|
(1)
|
Includes federal, state, provincial or local jurisdictions, as applicable.
|
(In millions)
|
December 31, 2014
|
|
December 31, 2013
|
||||
Overfunded defined benefit pension plans
|
$
|
44.1
|
|
|
$
|
16.7
|
|
Underfunded defined benefit pension plans
|
(79.5
|
)
|
|
(66.2
|
)
|
||
Unfunded defined benefit pension plans(1)
|
(378.0
|
)
|
|
(233.4
|
)
|
||
Total underfunded and unfunded defined benefit pension plans
|
(457.5
|
)
|
|
(299.6
|
)
|
||
Unfunded defined benefit pension plans included in liabilities subject to compromise(1)
|
—
|
|
|
(123.6
|
)
|
||
Pension liabilities included in other current liabilities
|
(15.6
|
)
|
|
(15.0
|
)
|
||
Net funded status
|
$
|
(429.0
|
)
|
|
$
|
(421.5
|
)
|
(1)
|
At emergence, Grace paid approximately
$27 million
of the unfunded defined benefit pension plan liability included in liabilities subject to compromise and reclassified the remaining balance to unfunded defined benefit pension plans.
|
|
Defined Benefit Pension Plans
|
|
Other Post-
Retirement Plans
|
||||||||||||||||||
Change in Financial Status of Retirement Plans
(In millions)
|
U.S.
|
|
Non-U.S.
|
|
Total
|
|
|||||||||||||||
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|||||||
Weighted Average Assumptions Used to Determine Benefit Obligations as of December 31:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
3.95
|
%
|
|
4.76
|
%
|
|
2.97
|
%
|
|
4.25
|
%
|
|
NM
|
|
NM
|
|
4.18
|
%
|
|
4.26
|
%
|
Rate of compensation increase
|
4.70
|
%
|
|
4.70
|
%
|
|
3.24
|
%
|
|
3.41
|
%
|
|
NM
|
|
NM
|
|
NM
|
|
|
NM
|
|
Weighted Average Assumptions Used to Determine Net Periodic Benefit Cost for Years Ended December 31:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
4.76
|
%
|
|
3.75
|
%
|
|
4.25
|
%
|
|
4.06
|
%
|
|
NM
|
|
NM
|
|
4.26
|
%
|
|
3.50
|
%
|
Expected return on plan assets
|
6.00
|
%
|
|
6.00
|
%
|
|
5.06
|
%
|
|
4.66
|
%
|
|
NM
|
|
NM
|
|
NM
|
|
|
NM
|
|
Rate of compensation increase
|
4.70
|
%
|
|
4.30
|
%
|
|
3.41
|
%
|
|
3.37
|
%
|
|
NM
|
|
NM
|
|
NM
|
|
|
NM
|
|
Components of Net Periodic Benefit (Income) Cost and Other Amounts Recognized in Other Comprehensive (Income) Loss
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||||||||||||||||||||||||||
U.S.
|
|
Non-U.S.
|
|
Other
|
|
U.S.
|
|
Non-U.S.
|
|
Other
|
|
U.S.
|
|
Non-U.S.
|
|
Other
|
|||||||||||||||||||
Net Periodic Benefit (Income) Cost
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Service cost
|
$
|
23.5
|
|
|
$
|
10.7
|
|
|
$
|
0.1
|
|
|
$
|
25.2
|
|
|
$
|
11.1
|
|
|
$
|
0.2
|
|
|
$
|
21.5
|
|
|
$
|
8.9
|
|
|
$
|
0.2
|
|
Interest cost
|
60.0
|
|
|
22.2
|
|
|
1.1
|
|
|
51.9
|
|
|
20.6
|
|
|
2.2
|
|
|
55.9
|
|
|
21.4
|
|
|
2.5
|
|
|||||||||
Expected return on plan assets
|
(69.9
|
)
|
|
(15.2
|
)
|
|
—
|
|
|
(68.0
|
)
|
|
(14.0
|
)
|
|
—
|
|
|
(63.3
|
)
|
|
(14.8
|
)
|
|
—
|
|
|||||||||
Amortization of prior service cost (credit)
|
0.7
|
|
|
—
|
|
|
(2.4
|
)
|
|
0.7
|
|
|
—
|
|
|
—
|
|
|
0.9
|
|
|
(0.1
|
)
|
|
—
|
|
|||||||||
Amortization of net deferred actuarial loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.4
|
|
|
—
|
|
|
—
|
|
|
0.6
|
|
|||||||||
Annual mark-to-market adjustment
|
89.2
|
|
|
45.4
|
|
|
—
|
|
|
(65.8
|
)
|
|
11.0
|
|
|
—
|
|
|
67.7
|
|
|
52.2
|
|
|
—
|
|
|||||||||
Gain on termination of postretirement plans
|
—
|
|
|
—
|
|
|
(39.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Net curtailment and settlement gain
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Net periodic benefit (income) cost
|
$
|
103.5
|
|
|
$
|
63.1
|
|
|
$
|
(40.7
|
)
|
|
$
|
(56.0
|
)
|
|
$
|
28.6
|
|
|
$
|
2.8
|
|
|
$
|
82.7
|
|
|
$
|
67.6
|
|
|
$
|
3.3
|
|
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive (Income) Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net deferred actuarial gain
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1.0
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(4.3
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(2.1
|
)
|
Net prior service credit
|
—
|
|
|
—
|
|
|
(13.6
|
)
|
|
—
|
|
|
—
|
|
|
(1.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Amortization of prior service cost (credit)
|
(0.7
|
)
|
|
—
|
|
|
2.4
|
|
|
(0.7
|
)
|
|
—
|
|
|
—
|
|
|
(0.9
|
)
|
|
0.1
|
|
|
—
|
|
|||||||||
Amortization of net deferred actuarial loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
|
—
|
|
|
(0.6
|
)
|
|||||||||
Loss on termination of postretirement plans
|
—
|
|
|
—
|
|
|
12.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Total recognized in other comprehensive (income) loss
|
(0.7
|
)
|
|
—
|
|
|
—
|
|
|
(0.7
|
)
|
|
—
|
|
|
(6.4
|
)
|
|
(0.9
|
)
|
|
0.1
|
|
|
(2.7
|
)
|
|||||||||
Total recognized in net periodic benefit (income) cost and other comprehensive (income) loss
|
$
|
102.8
|
|
|
$
|
63.1
|
|
|
$
|
(40.7
|
)
|
|
$
|
(56.7
|
)
|
|
$
|
28.6
|
|
|
$
|
(3.6
|
)
|
|
$
|
81.8
|
|
|
$
|
67.7
|
|
|
$
|
0.6
|
|
Funded Status of U.S. Pension Plans
(In millions)
|
Fully-Funded U.S. Qualified
Pension Plans(1)
|
|
Underfunded U.S.
Qualified Pension Plans(1)
|
|
Unfunded Pay-As-You-Go
U.S. Nonqualified Plans(2)
|
||||||||||||||||||
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|||||||||||||
Projected benefit obligation
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,329.8
|
|
|
$
|
1,197.4
|
|
|
$
|
107.5
|
|
|
$
|
129.4
|
|
Fair value of plan assets
|
—
|
|
|
—
|
|
|
1,262.6
|
|
|
1,145.2
|
|
|
—
|
|
|
—
|
|
||||||
Funded status (PBO basis)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(67.2
|
)
|
|
$
|
(52.2
|
)
|
|
$
|
(107.5
|
)
|
|
$
|
(129.4
|
)
|
Benefits paid
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(69.7
|
)
|
|
$
|
(73.6
|
)
|
|
$
|
(34.7
|
)
|
|
$
|
(5.6
|
)
|
Funded Status of Non-U.S. Pension Plans
(In millions)
|
Fully-Funded Non-U.S.
Pension Plans(1)
|
|
Underfunded Non-U.S.
Pension Plans(1)
|
|
Unfunded Pay-As-You-Go
Non-U.S. Pension Plans(2)
|
||||||||||||||||||
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|||||||||||||
Projected benefit obligation
|
$
|
245.8
|
|
|
$
|
247.3
|
|
|
$
|
58.5
|
|
|
$
|
56.5
|
|
|
$
|
286.1
|
|
|
$
|
242.6
|
|
Fair value of plan assets
|
289.9
|
|
|
264.0
|
|
|
46.2
|
|
|
42.5
|
|
|
—
|
|
|
—
|
|
||||||
Funded status (PBO basis)
|
$
|
44.1
|
|
|
$
|
16.7
|
|
|
$
|
(12.3
|
)
|
|
$
|
(14.0
|
)
|
|
$
|
(286.1
|
)
|
|
$
|
(242.6
|
)
|
Benefits paid
|
$
|
(12.3
|
)
|
|
$
|
(10.0
|
)
|
|
$
|
(4.7
|
)
|
|
$
|
(4.2
|
)
|
|
$
|
(8.8
|
)
|
|
$
|
(7.9
|
)
|
(1)
|
Plans intended to be advance-funded.
|
(2)
|
Plans intended to be pay-as-you-go.
|
Pension Plans with Underfunded or
Unfunded Accumulated Benefit Obligation
(In millions)
|
U.S.
|
|
Non-U.S.
|
|
Total
|
||||||||||||||||||
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|||||||||||||
Projected benefit obligation
|
$
|
352.6
|
|
|
$
|
347.8
|
|
|
$
|
306.0
|
|
|
$
|
259.2
|
|
|
$
|
658.6
|
|
|
$
|
607.0
|
|
Accumulated benefit obligation
|
351.8
|
|
|
344.1
|
|
|
274.5
|
|
|
230.7
|
|
|
626.3
|
|
|
574.8
|
|
||||||
Fair value of plan assets
|
220.8
|
|
|
201.1
|
|
|
9.4
|
|
|
8.9
|
|
|
230.2
|
|
|
210.0
|
|
Estimated Expected Future Benefit Payments Reflecting Future Service and Medicare Subsidy Receipts for the Fiscal Years Ending
(In millions)
|
Pension Plans
|
|
Other
Postretirement Plans
|
|
Total
Payments
Net of
Subsidy
|
||||||||||||||
U.S.(1)
|
|
Non-U.S.(2)
|
|
Benefit
Payments
|
|
Medicare
Subsidy
Receipts
|
|
||||||||||||
Benefit
Payments(3)
|
|
Benefit
Payments
|
|
|
|
||||||||||||||
2012 (actual)
|
$
|
66.4
|
|
|
$
|
23.1
|
|
|
$
|
4.6
|
|
|
$
|
(3.3
|
)
|
|
$
|
90.8
|
|
2013 (actual)
|
79.2
|
|
|
22.1
|
|
|
4.5
|
|
|
(1.4
|
)
|
|
104.4
|
|
|||||
2014 (actual)(3)
|
104.4
|
|
|
25.8
|
|
|
3.7
|
|
|
(0.2
|
)
|
|
133.7
|
|
|||||
2015
|
83.0
|
|
|
21.6
|
|
|
0.1
|
|
|
—
|
|
|
104.7
|
|
|||||
2016
|
83.9
|
|
|
21.7
|
|
|
0.1
|
|
|
—
|
|
|
105.7
|
|
|||||
2017
|
85.3
|
|
|
22.6
|
|
|
0.1
|
|
|
—
|
|
|
108.0
|
|
|||||
2018
|
86.7
|
|
|
23.2
|
|
|
0.1
|
|
|
—
|
|
|
110.0
|
|
|||||
2019
|
87.8
|
|
|
24.8
|
|
|
0.1
|
|
|
—
|
|
|
112.7
|
|
|||||
2020 - 2024
|
451.7
|
|
|
136.2
|
|
|
0.6
|
|
|
—
|
|
|
588.5
|
|
(1)
|
Effective January 1, 2008, lump sum distributions from certain U.S. qualified pension plans were restricted based on the provisions of the Pension Protection Act of 2006 (the "Act"). The Act prohibited the distribution of lump sums to retiring participants while the Company was operating under Chapter 11 of the U.S. Bankruptcy Code and when the plan was less than
100%
funded. After emergence from Chapter 11, the plan is permitted to distribute lump sums to retiring participants under the Act when the plan is at least
80%
funded.
|
(2)
|
Non-U.S. estimated benefit payments for
2015
and future periods have been translated at the applicable
December 31, 2014
, exchange rates.
|
(3)
|
Includes approximately
$28 million
of benefit payments from nonqualified plans that were previously restricted by the Bankruptcy Court while the Company was in Chapter 11 and were paid in 2014.
|
•
|
Liability hedging portfolio: primarily invested in intermediate-term and long-term investment grade corporate bonds in actively managed strategies.
|
•
|
Growth portfolio: invested in a diversified set of assets designed to deliver performance in excess of the underlying liabilities with controls regarding the level of risk.
|
•
|
U.S. equity securities: the portfolio contains domestic equities that are passively managed to the S&P 500 and Russell 2000 benchmark and an allocation to an active portfolio benchmarked to the Russell 2000.
|
•
|
Non-U.S. equity securities: the portfolio contains non-U.S. equities in an actively managed strategy. Currency futures and forward contracts may be held for the sole purpose of hedging existing currency risk in the portfolio.
|
•
|
Other investments: may include (a) high yield bonds: fixed income portfolio of securities below investment grade including up to
30%
of the portfolio in non-U.S. issuers; and (b) global real estate securities: portfolio of diversified REIT and other liquid real estate related securities. These portfolios combine income generation and capital appreciation opportunities from developed markets globally.
|
•
|
Liquidity portfolio: invested in short-term assets intended to pay periodic plan benefits and expenses.
|
|
Target
Allocation
|
|
Percentage of Plan Assets
December 31,
|
|||||
U.S. Qualified Pension Plans Asset Category
|
2014
|
|
2014
|
|
2013
|
|||
U.S. equity securities
|
11
|
%
|
|
11
|
%
|
|
10
|
%
|
Non-U.S. equity securities
|
7
|
%
|
|
6
|
%
|
|
6
|
%
|
Short-term debt securities
|
10
|
%
|
|
10
|
%
|
|
10
|
%
|
Intermediate-term debt securities
|
26
|
%
|
|
26
|
%
|
|
28
|
%
|
Long-term debt securities
|
44
|
%
|
|
45
|
%
|
|
44
|
%
|
Other investments
|
2
|
%
|
|
2
|
%
|
|
2
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
Fair Value Measurements at December 31, 2014, Using
|
||||||||||||||
(In millions)
|
Total
|
|
Quoted Prices in
Active Markets
for Identical
Assets or
Liabilities
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
U.S. equity group trust funds
|
$
|
134.2
|
|
|
$
|
—
|
|
|
$
|
134.2
|
|
|
$
|
—
|
|
Non-U.S. equity group trust funds
|
76.8
|
|
|
—
|
|
|
76.8
|
|
|
—
|
|
||||
Corporate bond group trust funds—intermediate-term
|
324.9
|
|
|
—
|
|
|
324.9
|
|
|
—
|
|
||||
Corporate bond group trust funds—long-term
|
567.1
|
|
|
—
|
|
|
567.1
|
|
|
—
|
|
||||
Other fixed income group trust funds
|
23.7
|
|
|
—
|
|
|
23.7
|
|
|
—
|
|
||||
Common/collective trust funds
|
118.8
|
|
|
—
|
|
|
118.8
|
|
|
—
|
|
||||
Annuity and immediate participation contracts
|
17.1
|
|
|
—
|
|
|
17.1
|
|
|
—
|
|
||||
Total Assets
|
$
|
1,262.6
|
|
|
$
|
—
|
|
|
$
|
1,262.6
|
|
|
$
|
—
|
|
|
Fair Value Measurements at December 31, 2013, Using
|
||||||||||||||
(In millions)
|
Total
|
|
Quoted Prices in
Active Markets
for Identical
Assets or
Liabilities
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
U.S. equity group trust funds
|
$
|
111.5
|
|
|
$
|
—
|
|
|
$
|
111.5
|
|
|
$
|
—
|
|
Non-U.S. equity group trust funds
|
67.1
|
|
|
—
|
|
|
67.1
|
|
|
—
|
|
||||
Corporate bond group trust funds—intermediate-term
|
322.6
|
|
|
—
|
|
|
322.6
|
|
|
—
|
|
||||
Corporate bond group trust funds—long-term
|
502.3
|
|
|
—
|
|
|
502.3
|
|
|
—
|
|
||||
Other fixed income group trust funds
|
22.9
|
|
|
—
|
|
|
22.9
|
|
|
—
|
|
||||
Common/collective trust funds
|
102.3
|
|
|
—
|
|
|
102.3
|
|
|
—
|
|
||||
Annuity and immediate participation contracts
|
16.5
|
|
|
—
|
|
|
16.5
|
|
|
—
|
|
||||
Total Assets
|
$
|
1,145.2
|
|
|
$
|
—
|
|
|
$
|
1,145.2
|
|
|
$
|
—
|
|
|
Fair Value Measurements at December 31, 2014, Using
|
||||||||||||||
(In millions)
|
Total
|
|
Quoted Prices
in Active
Markets for
Identical
Assets or
Liabilities
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Common/collective trust funds
|
$
|
326.7
|
|
|
$
|
—
|
|
|
$
|
326.7
|
|
|
$
|
—
|
|
Government and agency securities
|
2.6
|
|
|
—
|
|
|
2.6
|
|
|
—
|
|
||||
Corporate bonds
|
1.1
|
|
|
—
|
|
|
1.1
|
|
|
—
|
|
||||
Insurance contracts and other investments
|
4.6
|
|
|
—
|
|
|
4.6
|
|
|
—
|
|
||||
Cash
|
1.1
|
|
|
1.1
|
|
|
—
|
|
|
—
|
|
||||
Total Assets
|
$
|
336.1
|
|
|
$
|
1.1
|
|
|
$
|
335.0
|
|
|
$
|
—
|
|
|
Fair Value Measurements at December 31, 2013, Using
|
||||||||||||||
(In millions)
|
Total
|
|
Quoted Prices
in Active
Markets for
Identical
Assets or
Liabilities
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Common/collective trust funds
|
$
|
294.8
|
|
|
$
|
—
|
|
|
$
|
294.8
|
|
|
$
|
—
|
|
Government and agency securities
|
2.4
|
|
|
—
|
|
|
2.4
|
|
|
—
|
|
||||
Corporate bonds
|
1.3
|
|
|
—
|
|
|
1.3
|
|
|
—
|
|
||||
Insurance contracts and other investments
|
6.3
|
|
|
—
|
|
|
6.3
|
|
|
—
|
|
||||
Cash
|
1.7
|
|
|
1.7
|
|
|
—
|
|
|
—
|
|
||||
Total Assets
|
$
|
306.5
|
|
|
$
|
1.7
|
|
|
$
|
304.8
|
|
|
$
|
—
|
|
(In millions)
|
December 31, 2014
|
|
December 31, 2013
|
||||
Other Current Liabilities
|
|
|
|
||||
Accrued compensation
|
$
|
77.0
|
|
|
$
|
65.6
|
|
Customer volume rebates
|
37.8
|
|
|
33.3
|
|
||
Income tax payable
|
34.1
|
|
|
32.0
|
|
||
Environmental contingencies
|
21.5
|
|
|
1.3
|
|
||
Accrued interest
|
21.0
|
|
|
0.6
|
|
||
Deferred revenue
|
19.4
|
|
|
14.3
|
|
||
Pension liabilities
|
15.6
|
|
|
15.0
|
|
||
Deferred income taxes
|
1.5
|
|
|
0.1
|
|
||
Other accrued liabilities
|
112.1
|
|
|
129.8
|
|
||
|
$
|
340.0
|
|
|
$
|
292.0
|
|
•
|
Product warranties with respect to certain products sold to customers in the ordinary course of business. These warranties typically provide that products will conform to specifications. Grace accrues a warranty liability on a transaction-specific basis depending on the individual facts and circumstances related to each sale. Both the liability and annual expense related to product warranties are immaterial to the Consolidated Financial Statements.
|
•
|
Performance guarantees offered to customers under certain licensing arrangements. Grace has not established a liability for these arrangements based on past performance.
|
•
|
Licenses of intellectual property by Grace to third parties in which Grace has agreed to indemnify the licensee against third party infringement claims.
|
•
|
Contracts providing for the sale of a former business unit or product line in which Grace has agreed to indemnify the buyer against liabilities arising prior to the closing of the transaction, including environmental liabilities.
|
•
|
Guarantees of real property lease obligations of third parties, typically arising out of (a) leases entered into by former subsidiaries of Grace, or (b) the assignment or sublease of a lease by Grace to a third party.
|
Restructuring Expenses and Asset Impairments
(In millions) |
Year Ended December 31,
|
||||||||||
2014
|
|
2013
|
|
2012
|
|||||||
Restructuring expenses
|
$
|
8.1
|
|
|
$
|
12.5
|
|
|
$
|
6.9
|
|
Asset impairments
|
14.3
|
|
|
—
|
|
|
—
|
|
|||
Total restructuring expenses and asset impairments
|
$
|
22.4
|
|
|
$
|
12.5
|
|
|
$
|
6.9
|
|
Restructuring Liability
(In millions)
|
December 31,
|
||||||||||
2014
|
|
2013
|
|
2012
|
|||||||
Balance, December 31, 2013
|
$
|
4.4
|
|
|
$
|
3.0
|
|
|
$
|
5.9
|
|
Accruals for severance and other costs
|
7.7
|
|
|
7.6
|
|
|
5.6
|
|
|||
Payments
|
(7.9
|
)
|
|
(6.4
|
)
|
|
(8.4
|
)
|
|||
Currency translation adjustments and other
|
0.3
|
|
|
0.2
|
|
|
(0.1
|
)
|
|||
Balance, December 31, 2014
|
$
|
4.5
|
|
|
$
|
4.4
|
|
|
$
|
3.0
|
|
|
Year Ended December 31,
|
||||||||||
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Restructuring expenses and asset impairments
|
$
|
22.4
|
|
|
$
|
12.5
|
|
|
$
|
6.9
|
|
Provision for environmental remediation
|
13.8
|
|
|
8.2
|
|
|
3.6
|
|
|||
Net (gain) loss on sales of investments and disposals of assets
|
(2.2
|
)
|
|
0.5
|
|
|
0.7
|
|
|||
Interest income
|
(1.4
|
)
|
|
(1.0
|
)
|
|
(1.0
|
)
|
|||
Currency transaction effects
|
(1.1
|
)
|
|
4.0
|
|
|
0.3
|
|
|||
Currency and other financial losses in Venezuela
|
1.0
|
|
|
8.5
|
|
|
—
|
|
|||
Other miscellaneous income
|
(4.0
|
)
|
|
(9.2
|
)
|
|
(4.4
|
)
|
|||
Other expense, net
|
$
|
28.5
|
|
|
$
|
23.5
|
|
|
$
|
6.1
|
|
Year Ended December 31, 2014
(In millions)
|
Pre-Tax
Amount
|
|
Tax
Benefit/
(Expense)
|
|
After-Tax
Amount
|
||||||
Defined benefit pension and other postretirement plans:
|
|
|
|
|
|
||||||
Amortization of net prior service credit included in net periodic benefit cost
|
$
|
(1.7
|
)
|
|
$
|
0.6
|
|
|
$
|
(1.1
|
)
|
Net prior service credit arising during period
|
13.6
|
|
|
(4.8
|
)
|
|
8.8
|
|
|||
Net deferred actuarial gain arising during period
|
1.0
|
|
|
(0.4
|
)
|
|
0.6
|
|
|||
Loss on termination of postretirement plans
|
(12.2
|
)
|
|
1.3
|
|
|
(10.9
|
)
|
|||
Benefit plans, net
|
0.7
|
|
|
(3.3
|
)
|
|
(2.6
|
)
|
|||
Currency translation adjustments
|
(28.0
|
)
|
|
—
|
|
|
(28.0
|
)
|
|||
Loss from hedging activities
|
(7.1
|
)
|
|
2.6
|
|
|
(4.5
|
)
|
|||
Other than temporary impairment of investment
|
0.8
|
|
|
—
|
|
|
0.8
|
|
|||
Loss on securities available for sale
|
(0.1
|
)
|
|
—
|
|
|
(0.1
|
)
|
|||
Other comprehensive loss attributable to W. R. Grace & Co. shareholders
|
$
|
(33.7
|
)
|
|
$
|
(0.7
|
)
|
|
$
|
(34.4
|
)
|
Year Ended December 31, 2013
(In millions)
|
Pre-Tax
Amount
|
|
Tax
Benefit/
(Expense)
|
|
After-Tax
Amount
|
||||||
Defined benefit pension and other postretirement plans:
|
|
|
|
|
|
||||||
Amortization of net prior service cost included in net periodic benefit cost
|
$
|
0.7
|
|
|
$
|
(0.2
|
)
|
|
$
|
0.5
|
|
Amortization of net deferred actuarial loss included in net periodic benefit cost
|
0.4
|
|
|
(0.1
|
)
|
|
0.3
|
|
|||
Net prior service credit arising during period
|
1.7
|
|
|
(0.6
|
)
|
|
1.1
|
|
|||
Net deferred actuarial gain arising during period
|
4.3
|
|
|
(1.6
|
)
|
|
2.7
|
|
|||
Benefit plans, net
|
7.1
|
|
|
(2.5
|
)
|
|
4.6
|
|
|||
Currency translation adjustments
|
(23.6
|
)
|
|
—
|
|
|
(23.6
|
)
|
|||
Loss from hedging activities
|
(0.3
|
)
|
|
0.1
|
|
|
(0.2
|
)
|
|||
Gain on securities available for sale
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|||
Other comprehensive loss attributable to W. R. Grace & Co. shareholders
|
$
|
(16.7
|
)
|
|
$
|
(2.4
|
)
|
|
$
|
(19.1
|
)
|
Year Ended December 31, 2012
(In millions)
|
Pre-Tax
Amount
|
|
Tax
Benefit/
(Expense)
|
|
After-Tax
Amount
|
||||||
Defined benefit pension and other postretirement plans:
|
|
|
|
|
|
||||||
Amortization of net prior service cost included in net periodic benefit cost
|
$
|
0.8
|
|
|
$
|
(0.3
|
)
|
|
$
|
0.5
|
|
Amortization of net deferred actuarial loss included in net periodic benefit cost
|
0.6
|
|
|
(0.2
|
)
|
|
0.4
|
|
|||
Net deferred actuarial gain arising during period
|
2.1
|
|
|
(0.7
|
)
|
|
1.4
|
|
|||
Benefit plans, net
|
3.5
|
|
|
(1.2
|
)
|
|
2.3
|
|
|||
Currency translation adjustments
|
5.5
|
|
|
—
|
|
|
5.5
|
|
|||
Gain from hedging activities
|
3.7
|
|
|
(1.3
|
)
|
|
2.4
|
|
|||
Other comprehensive income attributable to W. R. Grace & Co. shareholders
|
$
|
12.7
|
|
|
$
|
(2.5
|
)
|
|
$
|
10.2
|
|
Year Ended December 31, 2014
(In millions)
|
Defined Benefit Pension and Other Postretirement Plans
|
|
Currency Translation Adjustments
|
|
Gain (Loss) from Hedging Activities
|
|
Unrealized Loss on Investment
|
|
Gain (Loss) on Securities Available for Sale
|
|
Total
|
||||||||||||
Beginning balance
|
$
|
6.6
|
|
|
$
|
5.2
|
|
|
$
|
(0.5
|
)
|
|
$
|
(0.8
|
)
|
|
$
|
0.1
|
|
|
$
|
10.6
|
|
Other comprehensive income (loss) before reclassifications
|
9.4
|
|
|
(28.0
|
)
|
|
(3.2
|
)
|
|
—
|
|
|
(0.7
|
)
|
|
(22.5
|
)
|
||||||
Amounts reclassified from accumulated other comprehensive income
|
(12.0
|
)
|
|
—
|
|
|
(1.3
|
)
|
|
0.8
|
|
|
0.6
|
|
|
(11.9
|
)
|
||||||
Net current-period other comprehensive income (loss)
|
(2.6
|
)
|
|
(28.0
|
)
|
|
(4.5
|
)
|
|
0.8
|
|
|
(0.1
|
)
|
|
(34.4
|
)
|
||||||
Ending balance
|
$
|
4.0
|
|
|
$
|
(22.8
|
)
|
|
$
|
(5.0
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(23.8
|
)
|
Year Ended December 31, 2013
(In millions)
|
Defined Benefit Pension and Other Postretirement Plans
|
|
Currency Translation Adjustments
|
|
Gain (Loss) from Hedging Activities
|
|
Unrealized Loss on Investment
|
|
Gain (Loss) on Securities Available for Sale
|
|
Total
|
||||||||||||
Beginning balance
|
$
|
2.0
|
|
|
$
|
28.8
|
|
|
$
|
(0.3
|
)
|
|
$
|
(0.8
|
)
|
|
$
|
—
|
|
|
$
|
29.7
|
|
Other comprehensive income (loss) before reclassifications
|
3.8
|
|
|
(23.6
|
)
|
|
1.2
|
|
|
—
|
|
|
0.1
|
|
|
(18.5
|
)
|
||||||
Amounts reclassified from accumulated other comprehensive income
|
0.8
|
|
|
—
|
|
|
(1.4
|
)
|
|
—
|
|
|
—
|
|
|
(0.6
|
)
|
||||||
Net current-period other comprehensive income (loss)
|
4.6
|
|
|
(23.6
|
)
|
|
(0.2
|
)
|
|
—
|
|
|
0.1
|
|
|
(19.1
|
)
|
||||||
Ending balance
|
$
|
6.6
|
|
|
$
|
5.2
|
|
|
$
|
(0.5
|
)
|
|
$
|
(0.8
|
)
|
|
$
|
0.1
|
|
|
$
|
10.6
|
|
Year Ended December 31, 2012
(In millions)
|
Defined Benefit Pension and Other Postretirement Plans
|
|
Currency Translation Adjustments
|
|
Gain (Loss) from Hedging Activities
|
|
Unrealized Loss on Investment
|
|
Total
|
||||||||||
Beginning balance
|
$
|
(0.3
|
)
|
|
$
|
23.3
|
|
|
$
|
(2.7
|
)
|
|
$
|
(0.8
|
)
|
|
$
|
19.5
|
|
Other comprehensive income (loss) before reclassifications
|
1.4
|
|
|
5.5
|
|
|
(0.3
|
)
|
|
—
|
|
|
6.6
|
|
|||||
Amounts reclassified from accumulated other comprehensive income
|
0.9
|
|
|
—
|
|
|
2.7
|
|
|
—
|
|
|
3.6
|
|
|||||
Net current-period other comprehensive income
|
2.3
|
|
|
5.5
|
|
|
2.4
|
|
|
—
|
|
|
10.2
|
|
|||||
Ending balance
|
$
|
2.0
|
|
|
$
|
28.8
|
|
|
$
|
(0.3
|
)
|
|
$
|
(0.8
|
)
|
|
$
|
29.7
|
|
Stock Option Activity
|
Number Of
Shares
|
|
Average
Exercise
Price
|
|
Weighted-
Average
Grant Date
Fair Value
|
|||||
Balance, January 1, 2012
|
4,937,420
|
|
|
$
|
25.08
|
|
|
|
||
Options exercised
|
(1,679,359
|
)
|
|
19.14
|
|
|
|
|||
Options forfeited
|
(51,573
|
)
|
|
37.67
|
|
|
|
|||
Options terminated
|
(10,995
|
)
|
|
15.74
|
|
|
|
|
||
Options granted
|
828,991
|
|
|
49.01
|
|
|
$
|
16.67
|
|
|
Balance, December 31, 2012
|
4,024,484
|
|
|
32.33
|
|
|
|
|||
Options exercised
|
(1,464,294
|
)
|
|
23.46
|
|
|
|
|||
Options forfeited
|
(95,139
|
)
|
|
52.17
|
|
|
|
|||
Options terminated
|
(1,381
|
)
|
|
42.26
|
|
|
|
|||
Options granted
|
421,385
|
|
|
76.70
|
|
|
19.26
|
|
||
Balance, December 31, 2013
|
2,885,055
|
|
|
42.60
|
|
|
|
|||
Options exercised
|
(793,359
|
)
|
|
29.53
|
|
|
|
|||
Options forfeited
|
(42,424
|
)
|
|
68.07
|
|
|
|
|||
Options granted
|
474,518
|
|
|
93.39
|
|
|
20.12
|
|
||
Balance, December 31, 2014
|
2,523,790
|
|
|
|
|
|
|
|
Stock Option Activity
|
Number Of
Shares
|
|
Weighted-
Average
Grant Date
Fair Value
|
|||
Nonvested options outstanding at beginning of year
|
1,282,925
|
|
|
$
|
17.98
|
|
Granted
|
474,518
|
|
|
20.12
|
|
|
Vested
|
(755,177
|
)
|
|
15.67
|
|
|
Forfeited
|
(42,424
|
)
|
|
18.41
|
|
|
Nonvested options outstanding at end of year
|
959,842
|
|
|
|
|
Exercise Price Range
|
Number
Outstanding
|
|
Number
Exercisable
|
|
Outstanding Weighted-
Average
Remaining
Contractual
Life (Years)
|
|
Exercisable
Weighted-
Average
Exercise
Price
|
||||
$20 - $30
|
432,969
|
|
|
432,969
|
|
|
0.34
|
|
$
|
27.75
|
|
$30 - $40
|
6,000
|
|
|
6,000
|
|
|
1.61
|
|
37.06
|
|
|
$40 - $50
|
1,229,774
|
|
|
997,427
|
|
|
1.88
|
|
44.43
|
|
|
$60 - $70
|
21,086
|
|
|
13,327
|
|
|
2.92
|
|
66.26
|
|
|
$70 - $80
|
366,061
|
|
|
113,780
|
|
|
3.32
|
|
76.66
|
|
|
$80 - $90
|
1,928
|
|
|
445
|
|
|
3.49
|
|
84.74
|
|
|
$90 - $100
|
436,472
|
|
|
—
|
|
|
4.48
|
|
—
|
|
|
$100 - $110
|
29,500
|
|
|
—
|
|
|
4.16
|
|
—
|
|
|
|
2,523,790
|
|
|
1,563,948
|
|
|
|
|
|
|
2014
|
|
2013
|
|
2012
|
Expected volatility
|
28.2% - 28.7%
|
|
32.3% - 34.3%
|
|
35.8% - 46.4%
|
Weighted average expected volatility
|
28.6%
|
|
33.3%
|
|
40.6%
|
Expected term
|
3.00 - 4.00 years
|
|
3.00 - 4.00 years
|
|
3.00 - 4.00 years
|
Risk-free rate
|
1.25%
|
|
0.61%
|
|
0.55%
|
Dividend yield
|
—%
|
|
—%
|
|
—%
|
(In millions, except per share amounts)
|
2014
|
|
2013
|
|
2012
|
||||||
Numerators
|
|
|
|
|
|
||||||
Net income attributable to W. R. Grace & Co. shareholders
|
$
|
276.3
|
|
|
$
|
256.1
|
|
|
$
|
40.0
|
|
Denominators
|
|
|
|
|
|
||||||
Weighted average common shares—basic calculation
|
75.3
|
|
|
76.4
|
|
|
74.9
|
|
|||
Dilutive effect of employee stock options
|
0.9
|
|
|
1.3
|
|
|
1.4
|
|
|||
Weighted average common shares—diluted calculation
|
76.2
|
|
|
77.7
|
|
|
76.3
|
|
|||
Basic earnings per share
|
$
|
3.67
|
|
|
$
|
3.35
|
|
|
$
|
0.53
|
|
Diluted earnings per share
|
$
|
3.63
|
|
|
$
|
3.30
|
|
|
$
|
0.52
|
|
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Net Sales
|
|
|
|
|
|
||||||
Catalysts Technologies
|
$
|
1,246.8
|
|
|
$
|
1,124.0
|
|
|
$
|
1,268.1
|
|
Materials Technologies
|
890.6
|
|
|
878.5
|
|
|
862.6
|
|
|||
Construction Products
|
1,105.6
|
|
|
1,058.2
|
|
|
1,024.8
|
|
|||
Total
|
$
|
3,243.0
|
|
|
$
|
3,060.7
|
|
|
$
|
3,155.5
|
|
Adjusted EBIT
|
|
|
|
|
|
||||||
Catalysts Technologies segment operating income
|
$
|
378.3
|
|
|
$
|
327.5
|
|
|
$
|
393.8
|
|
Materials Technologies segment operating income
|
185.2
|
|
|
181.8
|
|
|
162.0
|
|
|||
Construction Products segment operating income
|
161.7
|
|
|
151.7
|
|
|
125.2
|
|
|||
Corporate costs
|
(90.6
|
)
|
|
(82.8
|
)
|
|
(92.4
|
)
|
|||
Gain on termination of postretirement plans related to current businesses
|
23.6
|
|
|
—
|
|
|
—
|
|
|||
Certain pension costs
|
(32.0
|
)
|
|
(27.4
|
)
|
|
(30.4
|
)
|
|||
Total
|
$
|
626.2
|
|
|
$
|
550.8
|
|
|
$
|
558.2
|
|
Depreciation and Amortization
|
|
|
|
|
|
||||||
Catalysts Technologies
|
$
|
66.3
|
|
|
$
|
54.2
|
|
|
$
|
54.0
|
|
Materials Technologies
|
32.1
|
|
|
31.4
|
|
|
29.5
|
|
|||
Construction Products
|
31.7
|
|
|
31.8
|
|
|
32.9
|
|
|||
Corporate
|
7.0
|
|
|
5.7
|
|
|
2.6
|
|
|||
Total
|
$
|
137.1
|
|
|
$
|
123.1
|
|
|
$
|
119.0
|
|
Capital Expenditures
|
|
|
|
|
|
||||||
Catalysts Technologies
|
$
|
81.6
|
|
|
$
|
58.7
|
|
|
$
|
70.8
|
|
Materials Technologies
|
35.6
|
|
|
33.0
|
|
|
27.1
|
|
|||
Construction Products
|
28.3
|
|
|
32.8
|
|
|
26.5
|
|
|||
Corporate
|
24.3
|
|
|
31.7
|
|
|
14.1
|
|
|||
Total
|
$
|
169.8
|
|
|
$
|
156.2
|
|
|
$
|
138.5
|
|
Total Assets
|
|
|
|
|
|
||||||
Catalysts Technologies
|
$
|
1,395.4
|
|
|
$
|
1,361.8
|
|
|
$
|
794.8
|
|
Materials Technologies
|
501.2
|
|
|
508.9
|
|
|
494.9
|
|
|||
Construction Products
|
580.0
|
|
|
609.1
|
|
|
616.0
|
|
|||
Corporate
|
1,618.6
|
|
|
2,916.3
|
|
|
3,184.7
|
|
|||
Total
|
$
|
4,095.2
|
|
|
$
|
5,396.1
|
|
|
$
|
5,090.4
|
|
|
Year Ended December 31,
|
||||||||||
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Grace Adjusted EBIT
|
$
|
626.2
|
|
|
$
|
550.8
|
|
|
$
|
558.2
|
|
Costs related to Chapter 11
|
(11.3
|
)
|
|
(16.4
|
)
|
|
(15.6
|
)
|
|||
Asbestos-related costs
|
(7.9
|
)
|
|
(7.8
|
)
|
|
(5.0
|
)
|
|||
Asbestos and bankruptcy-related charges, net
|
(7.1
|
)
|
|
(21.9
|
)
|
|
(384.6
|
)
|
|||
Default interest settlement
|
—
|
|
|
(129.0
|
)
|
|
—
|
|
|||
Pension MTM adjustment and other related costs, net
|
(128.3
|
)
|
|
50.6
|
|
|
(119.2
|
)
|
|||
Gain on termination of postretirement plans related to divested businesses
|
15.9
|
|
|
—
|
|
|
—
|
|
|||
Restructuring expenses and asset impairments
|
(22.4
|
)
|
|
(12.5
|
)
|
|
(6.9
|
)
|
|||
Gain (loss) on sale of product line
|
0.2
|
|
|
(1.0
|
)
|
|
(0.2
|
)
|
|||
Income and expense items related to divested businesses
|
(5.2
|
)
|
|
(4.1
|
)
|
|
(2.8
|
)
|
|||
Interest expense and related financing costs
|
(61.5
|
)
|
|
(43.8
|
)
|
|
(46.5
|
)
|
|||
Interest accretion on deferred payment obligations
|
(65.7
|
)
|
|
—
|
|
|
—
|
|
|||
Currency and other financial losses in Venezuela
|
(1.0
|
)
|
|
(6.9
|
)
|
|
—
|
|
|||
Interest income
|
1.4
|
|
|
1.0
|
|
|
1.0
|
|
|||
Net income attributable to noncontrolling interests
|
1.0
|
|
|
1.6
|
|
|
1.0
|
|
|||
Income (loss) before income taxes
|
$
|
334.3
|
|
|
$
|
360.6
|
|
|
$
|
(20.6
|
)
|
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Net Sales
|
|
|
|
|
|
||||||
United States
|
$
|
976.5
|
|
|
$
|
886.0
|
|
|
$
|
878.9
|
|
Canada and Puerto Rico
|
78.7
|
|
|
73.7
|
|
|
88.7
|
|
|||
Total North America
|
1,055.2
|
|
|
959.7
|
|
|
967.6
|
|
|||
Europe Middle East Africa
|
1,097.0
|
|
|
1,087.9
|
|
|
1,175.6
|
|
|||
Asia Pacific
|
716.2
|
|
|
654.1
|
|
|
660.3
|
|
|||
Latin America
|
374.6
|
|
|
359.0
|
|
|
352.0
|
|
|||
Total
|
$
|
3,243.0
|
|
|
$
|
3,060.7
|
|
|
$
|
3,155.5
|
|
Properties and Equipment, net
|
|
|
|
|
|
||||||
United States
|
$
|
526.2
|
|
|
$
|
497.8
|
|
|
$
|
438.4
|
|
Canada and Puerto Rico
|
17.5
|
|
|
19.1
|
|
|
19.8
|
|
|||
Total North America
|
543.7
|
|
|
516.9
|
|
|
458.2
|
|
|||
Europe Middle East Africa
|
189.3
|
|
|
212.4
|
|
|
210.3
|
|
|||
Asia Pacific
|
70.7
|
|
|
70.9
|
|
|
72.1
|
|
|||
Latin America
|
29.8
|
|
|
29.7
|
|
|
29.9
|
|
|||
Total
|
$
|
833.5
|
|
|
$
|
829.9
|
|
|
$
|
770.5
|
|
Goodwill, Intangibles and Other Assets
|
|
|
|
|
|
||||||
United States
|
$
|
615.8
|
|
|
$
|
589.7
|
|
|
$
|
91.5
|
|
Canada and Puerto Rico
|
7.6
|
|
|
8.6
|
|
|
7.3
|
|
|||
Total North America
|
623.4
|
|
|
598.3
|
|
|
98.8
|
|
|||
Europe Middle East Africa
|
90.9
|
|
|
106.4
|
|
|
105.2
|
|
|||
Asia Pacific
|
49.8
|
|
|
52.4
|
|
|
40.1
|
|
|||
Latin America
|
37.5
|
|
|
55.9
|
|
|
59.8
|
|
|||
Total
|
$
|
801.6
|
|
|
$
|
813.0
|
|
|
$
|
303.9
|
|
|
December 31,
|
||||||
(In millions)
|
2014
|
|
2013
|
||||
Summary of Balance Sheet information:
|
|
|
|
||||
Current assets
|
$
|
216.9
|
|
|
$
|
186.7
|
|
Noncurrent assets
|
59.3
|
|
|
62.4
|
|
||
Total assets
|
$
|
276.2
|
|
|
$
|
249.1
|
|
|
|
|
|
||||
Current liabilities
|
$
|
54.7
|
|
|
$
|
61.4
|
|
Noncurrent liabilities
|
—
|
|
|
0.6
|
|
||
Total liabilities
|
$
|
54.7
|
|
|
$
|
62.0
|
|
|
Year Ended December 31,
|
||||||||||
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Summary of Statement of Operations information:
|
|
|
|
|
|
||||||
Net sales
|
$
|
409.9
|
|
|
$
|
370.4
|
|
|
$
|
325.0
|
|
Costs and expenses applicable to net sales
|
358.1
|
|
|
311.2
|
|
|
276.0
|
|
|||
Income before income taxes
|
41.2
|
|
|
46.6
|
|
|
38.9
|
|
|||
Net income
|
39.7
|
|
|
45.6
|
|
|
37.8
|
|
|
Year Ended December 31,
|
||||||||||
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Grace sales of catalysts to ART
|
$
|
266.4
|
|
|
$
|
232.0
|
|
|
$
|
206.9
|
|
Charges for fixed costs, research and development and selling, general and administrative services to ART
|
26.9
|
|
|
28.8
|
|
|
28.5
|
|
(In millions, except per share amounts)
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
2014
|
|
|
|
|
|
|
|
||||||||
Net sales
|
$
|
744.5
|
|
|
$
|
838.0
|
|
|
$
|
856.4
|
|
|
$
|
804.1
|
|
Gross profit
|
269.2
|
|
|
320.9
|
|
|
327.8
|
|
|
274.5
|
|
||||
Net income
|
50.1
|
|
|
136.2
|
|
|
74.5
|
|
|
15.5
|
|
||||
Net income per share:(1)
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
0.65
|
|
|
$
|
1.79
|
|
|
$
|
1.00
|
|
|
$
|
0.21
|
|
Diluted earnings per share:
|
|
|
|
|
|
|
|
||||||||
Net income
|
0.64
|
|
|
1.77
|
|
|
0.99
|
|
|
0.21
|
|
||||
Market price of common stock:(2)
|
|
|
|
|
|
|
|
||||||||
High
|
$
|
105.05
|
|
|
$
|
102.65
|
|
|
$
|
100.07
|
|
|
$
|
99.55
|
|
Low
|
90.58
|
|
|
90.40
|
|
|
90.56
|
|
|
79.06
|
|
||||
Close
|
99.17
|
|
|
94.53
|
|
|
90.94
|
|
|
95.39
|
|
(1)
|
Per share results for the four quarters may differ from full-year per share results, as a separate computation of the weighted average number of shares outstanding is made for each quarter presented.
|
(2)
|
Principal market: New York Stock Exchange.
|
(In millions, except per share amounts)
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
2013
|
|
|
|
|
|
|
|
||||||||
Net sales
|
$
|
709.9
|
|
|
$
|
802.8
|
|
|
$
|
771.3
|
|
|
$
|
776.7
|
|
Gross profit
|
259.0
|
|
|
300.9
|
|
|
282.4
|
|
|
299.8
|
|
||||
Net income (loss)
|
59.1
|
|
|
90.3
|
|
|
77.0
|
|
|
29.7
|
|
||||
Net income per share:(1)
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
0.78
|
|
|
$
|
1.18
|
|
|
$
|
1.00
|
|
|
$
|
0.39
|
|
Diluted earnings per share:
|
|
|
|
|
|
|
|
||||||||
Net income
|
0.77
|
|
|
1.16
|
|
|
0.99
|
|
|
0.38
|
|
||||
Market price of common stock:(2)
|
|
|
|
|
|
|
|
||||||||
High
|
$
|
79.14
|
|
|
$
|
85.43
|
|
|
$
|
89.80
|
|
|
$
|
101.72
|
|
Low
|
68.23
|
|
|
72.00
|
|
|
74.46
|
|
|
85.06
|
|
||||
Close
|
77.51
|
|
|
84.04
|
|
|
87.40
|
|
|
98.87
|
|
(1)
|
Per share results for the four quarters may differ from full-year per share results, as a separate computation of the weighted average number of shares outstanding is made for each quarter presented.
|
(2)
|
Principal market: New York Stock Exchange.
|
(In millions, except per share amounts)
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
||||||||||
Statement of Operations
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
$
|
3,243.0
|
|
|
$
|
3,060.7
|
|
|
$
|
3,155.5
|
|
|
$
|
3,211.9
|
|
|
$
|
2,675.0
|
|
Income before income taxes(2)
|
334.3
|
|
|
360.6
|
|
|
(20.6
|
)
|
|
307.0
|
|
|
220.3
|
|
|||||
Net income
|
277.3
|
|
|
257.7
|
|
|
41.0
|
|
|
219.1
|
|
|
194.1
|
|
|||||
Net loss (income) attributable to noncontrolling interests
|
(1.0
|
)
|
|
(1.6
|
)
|
|
(1.0
|
)
|
|
0.6
|
|
|
(0.3
|
)
|
|||||
Net income attributable to W. R. Grace & Co. shareholders
|
276.3
|
|
|
256.1
|
|
|
40.0
|
|
|
219.7
|
|
|
193.8
|
|
|||||
Financial Position
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
557.5
|
|
|
$
|
964.8
|
|
|
$
|
1,336.9
|
|
|
$
|
1,048.3
|
|
|
$
|
1,015.7
|
|
Property and equipment, net
|
833.5
|
|
|
829.9
|
|
|
770.5
|
|
|
723.5
|
|
|
702.5
|
|
|||||
Total assets
|
4,095.2
|
|
|
5,396.1
|
|
|
5,090.4
|
|
|
4,495.6
|
|
|
4,243.2
|
|
|||||
Total liabilities
|
3,726.2
|
|
|
4,824.9
|
|
|
4,770.6
|
|
|
4,311.4
|
|
|
4,298.9
|
|
|||||
Liabilities subject to compromise (a subset of total liabilities)
|
—
|
|
|
3,776.1
|
|
|
3,619.9
|
|
|
3,191.5
|
|
|
3,171.9
|
|
|||||
Shareholders' equity (deficit)
|
369.0
|
|
|
571.2
|
|
|
319.8
|
|
|
184.2
|
|
|
(55.7
|
)
|
|||||
Cash Flow
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating activities
|
$
|
(1,472.1
|
)
|
|
$
|
515.9
|
|
|
$
|
453.6
|
|
|
$
|
219.4
|
|
|
$
|
325.9
|
|
Investing activities
|
235.3
|
|
|
(880.7
|
)
|
|
(280.3
|
)
|
|
(220.9
|
)
|
|
(243.1
|
)
|
|||||
Financing activities
|
849.9
|
|
|
(8.4
|
)
|
|
110.3
|
|
|
39.7
|
|
|
41.5
|
|
|||||
Net cash flow
|
(407.3
|
)
|
|
(372.1
|
)
|
|
288.6
|
|
|
32.6
|
|
|
122.7
|
|
|||||
Data Per Common Share (Diluted)
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
$
|
3.63
|
|
|
$
|
3.30
|
|
|
$
|
0.52
|
|
|
$
|
2.91
|
|
|
$
|
2.61
|
|
Average common diluted shares outstanding
|
76.2
|
|
|
77.7
|
|
|
76.3
|
|
|
75.5
|
|
|
74.4
|
|
|||||
Other Statistics
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
$
|
169.8
|
|
|
$
|
156.2
|
|
|
$
|
138.5
|
|
|
$
|
144.0
|
|
|
$
|
111.1
|
|
Common stock price range
|
79.06-105.05
|
|
|
68.23-101.72
|
|
|
45.39-68.86
|
|
|
30.25-52.50
|
|
|
19.63-36.27
|
|
|||||
Common shareholders of record
|
5,839
|
|
|
7,077
|
|
|
7,591
|
|
|
8,063
|
|
|
8,270
|
|
|||||
Number of employees (approximate)
|
6,500
|
|
|
6,700
|
|
|
6,500
|
|
|
6,300
|
|
|
6,000
|
|
(1)
|
Certain prior-year amounts have been reclassified to conform to the
2014
presentation.
|
(2)
|
Adjustments related to our asbestos-related liability, Chapter 11, and pension mark-to-market accounting are included in and affect the period-to-period comparability of "Income before income taxes." See Note 18 to the Consolidated Financial Statements for a detail of these items.
|
•
|
Net sales increased
6.0%
to
$3,243.0 million
.
|
•
|
Segment Gross Margin increased
140
basis points to
38.5%
.
|
•
|
Adjusted EBIT increased
13.7%
to
$626.2 million
.
|
•
|
Grace net income increased to
$276.3 million
or
$3.63
per diluted share.
|
Analysis of Operations
(In millions, except per share amounts)
|
2014
|
|
2013
|
|
% Change
|
|
2012
|
|
% Change
|
||||||||
Net sales:
|
|
|
|
|
|
|
|
|
|
||||||||
Catalysts Technologies
|
$
|
1,246.8
|
|
|
$
|
1,124.0
|
|
|
10.9
|
%
|
|
$
|
1,268.1
|
|
|
(11.4
|
)%
|
Materials Technologies
|
890.6
|
|
|
878.5
|
|
|
1.4
|
%
|
|
862.6
|
|
|
1.8
|
%
|
|||
Construction Products
|
1,105.6
|
|
|
1,058.2
|
|
|
4.5
|
%
|
|
1,024.8
|
|
|
3.3
|
%
|
|||
Total Grace net sales
|
$
|
3,243.0
|
|
|
$
|
3,060.7
|
|
|
6.0
|
%
|
|
$
|
3,155.5
|
|
|
(3.0
|
)%
|
Net sales by region:
|
|
|
|
|
|
|
|
|
|
||||||||
North America
|
$
|
1,055.2
|
|
|
$
|
959.7
|
|
|
10.0
|
%
|
|
$
|
967.6
|
|
|
(0.8
|
)%
|
Europe Middle East Africa
|
1,097.0
|
|
|
1,087.9
|
|
|
0.8
|
%
|
|
1,175.6
|
|
|
(7.5
|
)%
|
|||
Asia Pacific
|
716.2
|
|
|
654.1
|
|
|
9.5
|
%
|
|
660.3
|
|
|
(0.9
|
)%
|
|||
Latin America
|
374.6
|
|
|
359.0
|
|
|
4.3
|
%
|
|
352.0
|
|
|
2.0
|
%
|
|||
Total net sales by region
|
$
|
3,243.0
|
|
|
$
|
3,060.7
|
|
|
6.0
|
%
|
|
$
|
3,155.5
|
|
|
(3.0
|
)%
|
Profitability performance measures:
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted EBIT(A):
|
|
|
|
|
|
|
|
|
|
||||||||
Catalysts Technologies segment operating income
|
$
|
378.3
|
|
|
$
|
327.5
|
|
|
15.5
|
%
|
|
$
|
393.8
|
|
|
(16.8
|
)%
|
Materials Technologies segment operating income
|
185.2
|
|
|
181.8
|
|
|
1.9
|
%
|
|
162.0
|
|
|
12.2
|
%
|
|||
Construction Products segment operating income
|
161.7
|
|
|
151.7
|
|
|
6.6
|
%
|
|
125.2
|
|
|
21.2
|
%
|
|||
Corporate costs
|
(90.6
|
)
|
|
(82.8
|
)
|
|
(9.4
|
)%
|
|
(92.4
|
)
|
|
10.4
|
%
|
|||
Gain on termination of postretirement plans related to current businesses
|
23.6
|
|
|
—
|
|
|
NM
|
|
|
—
|
|
|
—
|
%
|
|||
Certain pension costs(B)
|
(32.0
|
)
|
|
(27.4
|
)
|
|
(16.8
|
)%
|
|
(30.4
|
)
|
|
9.9
|
%
|
|||
Adjusted EBIT
|
626.2
|
|
|
550.8
|
|
|
13.7
|
%
|
|
558.2
|
|
|
(1.3
|
)%
|
|||
Costs related to Chapter 11
|
(11.3
|
)
|
|
(16.4
|
)
|
|
|
|
(15.6
|
)
|
|
|
|||||
Asbestos-related costs, net
|
(7.9
|
)
|
|
(7.8
|
)
|
|
|
|
(5.0
|
)
|
|
|
|||||
Asbestos and bankruptcy-related charges, net
|
(7.1
|
)
|
|
(21.9
|
)
|
|
|
|
(384.6
|
)
|
|
|
|||||
Default interest settlement
|
—
|
|
|
(129.0
|
)
|
|
|
|
—
|
|
|
|
|||||
Pension MTM adjustment and other related costs, net
|
(128.3
|
)
|
|
50.6
|
|
|
|
|
(119.2
|
)
|
|
|
|||||
Gain on termination of postretirement plans related to divested businesses
|
15.9
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|||||
Restructuring expenses and asset impairments
|
(22.4
|
)
|
|
(12.5
|
)
|
|
|
|
(6.9
|
)
|
|
|
|||||
Gain (loss) on sale of product line
|
0.2
|
|
|
(1.0
|
)
|
|
|
|
(0.2
|
)
|
|
|
|||||
Income and expense items related to divested businesses
|
(5.2
|
)
|
|
(4.1
|
)
|
|
|
|
(2.8
|
)
|
|
|
|||||
Interest expense and related financing costs
|
(61.5
|
)
|
|
(43.8
|
)
|
|
|
|
(46.5
|
)
|
|
|
|||||
Interest accretion on deferred payment obligations
|
(65.7
|
)
|
|
—
|
|
|
|
|
—
|
|
|
|
|||||
Currency and other financial losses in Venezuela
|
(1.0
|
)
|
|
(6.9
|
)
|
|
|
|
—
|
|
|
|
|||||
Interest income
|
1.4
|
|
|
1.0
|
|
|
|
|
1.0
|
|
|
|
|||||
Benefit from (provision for) income taxes
|
(57.0
|
)
|
|
(102.9
|
)
|
|
|
|
61.6
|
|
|
|
|||||
Net income attributable to W. R. Grace & Co. shareholders
|
$
|
276.3
|
|
|
$
|
256.1
|
|
|
|
|
$
|
40.0
|
|
|
|
||
Diluted EPS (GAAP)
|
$
|
3.63
|
|
|
$
|
3.30
|
|
|
|
|
$
|
0.52
|
|
|
|
||
Adjusted EPS (non-GAAP)
|
$
|
4.43
|
|
|
$
|
4.39
|
|
|
|
|
$
|
4.53
|
|
|
|
Analysis of Operations
(In millions)
|
2014
|
|
2013
|
|
% Change
|
|
2012
|
|
% Change
|
||||||||
Profitability performance measures:
|
|
|
|
|
|
|
|
|
|
||||||||
Gross margin:
|
|
|
|
|
|
|
|
|
|
||||||||
Catalysts Technologies
|
42.8
|
%
|
|
40.1
|
%
|
|
2.7 pts
|
|
|
41.0
|
%
|
|
(0.9) pts
|
|
|||
Materials Technologies
|
35.4
|
%
|
|
34.6
|
%
|
|
0.8 pts
|
|
|
33.1
|
%
|
|
1.5 pts
|
|
|||
Construction Products
|
36.3
|
%
|
|
36.0
|
%
|
|
0.3 pts
|
|
|
35.2
|
%
|
|
0.8 pts
|
|
|||
Segment Gross Margin
|
38.5
|
%
|
|
37.1
|
%
|
|
1.4 pts
|
|
|
37.0
|
%
|
|
0.1 pts
|
|
|||
Pension costs in cost of goods sold
|
(1.8
|
)%
|
|
0.2
|
%
|
|
(2.0) pts
|
|
|
(1.6
|
)%
|
|
1.8 pts
|
|
|||
Total Grace
|
36.8
|
%
|
|
37.3
|
%
|
|
(0.5) pts
|
|
|
35.3
|
%
|
|
2.0 pts
|
|
|||
Adjusted profitability performance measures:
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted EBIT:
|
|
|
|
|
|
|
|
|
|
||||||||
Catalysts Technologies
|
$
|
378.3
|
|
|
$
|
327.5
|
|
|
15.5
|
%
|
|
$
|
393.8
|
|
|
(16.8
|
)%
|
Materials Technologies
|
185.2
|
|
|
181.8
|
|
|
1.9
|
%
|
|
162.0
|
|
|
12.2
|
%
|
|||
Construction Products
|
161.7
|
|
|
151.7
|
|
|
6.6
|
%
|
|
125.2
|
|
|
21.2
|
%
|
|||
Corporate
|
(99.0
|
)
|
|
(110.2
|
)
|
|
10.2
|
%
|
|
(122.8
|
)
|
|
10.3
|
%
|
|||
Total Grace
|
626.2
|
|
|
550.8
|
|
|
13.7
|
%
|
|
558.2
|
|
|
(1.3
|
)%
|
|||
Depreciation and amortization:
|
|
|
|
|
|
|
|
|
|
||||||||
Catalysts Technologies
|
$
|
66.3
|
|
|
$
|
54.2
|
|
|
22.3
|
%
|
|
$
|
54.0
|
|
|
0.4
|
%
|
Materials Technologies
|
32.1
|
|
|
31.4
|
|
|
2.2
|
%
|
|
29.5
|
|
|
6.4
|
%
|
|||
Construction Products
|
31.7
|
|
|
31.8
|
|
|
(0.3
|
)%
|
|
32.9
|
|
|
(3.3
|
)%
|
|||
Corporate
|
7.0
|
|
|
5.7
|
|
|
22.8
|
%
|
|
2.6
|
|
|
119.2
|
%
|
|||
Total Grace
|
137.1
|
|
|
123.1
|
|
|
11.4
|
%
|
|
119.0
|
|
|
3.4
|
%
|
|||
Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
||||||||
Catalysts Technologies
|
$
|
444.6
|
|
|
$
|
381.7
|
|
|
16.5
|
%
|
|
$
|
447.8
|
|
|
(14.8
|
)%
|
Materials Technologies
|
217.3
|
|
|
213.2
|
|
|
1.9
|
%
|
|
191.5
|
|
|
11.3
|
%
|
|||
Construction Products
|
193.4
|
|
|
183.5
|
|
|
5.4
|
%
|
|
158.1
|
|
|
16.1
|
%
|
|||
Corporate
|
(92.0
|
)
|
|
(104.5
|
)
|
|
12.0
|
%
|
|
(120.2
|
)
|
|
13.1
|
%
|
|||
Total Grace
|
763.3
|
|
|
673.9
|
|
|
13.3
|
%
|
|
677.2
|
|
|
(0.5
|
)%
|
|||
Operating margin:
|
|
|
|
|
|
|
|
|
|
||||||||
Catalysts Technologies
|
30.3
|
%
|
|
29.1
|
%
|
|
1.2 pts
|
|
|
31.1
|
%
|
|
(2.0) pts
|
|
|||
Materials Technologies
|
20.8
|
%
|
|
20.7
|
%
|
|
0.1 pts
|
|
|
18.8
|
%
|
|
1.9 pts
|
|
|||
Construction Products
|
14.6
|
%
|
|
14.3
|
%
|
|
0.3 pts
|
|
|
12.2
|
%
|
|
2.1 pts
|
|
|||
Total Grace
|
19.3
|
%
|
|
18.0
|
%
|
|
1.3 pts
|
|
|
17.7
|
%
|
|
0.3 pts
|
|
|||
Adjusted EBITDA margin:
|
|
|
|
|
|
|
|
|
|
||||||||
Catalysts Technologies
|
35.7
|
%
|
|
34.0
|
%
|
|
1.7 pts
|
|
|
35.3
|
%
|
|
(1.3) pts
|
|
|||
Materials Technologies
|
24.4
|
%
|
|
24.3
|
%
|
|
0.1 pts
|
|
|
22.2
|
%
|
|
2.1 pts
|
|
|||
Construction Products
|
17.5
|
%
|
|
17.3
|
%
|
|
0.2 pts
|
|
|
15.4
|
%
|
|
1.9 pts
|
|
|||
Total Grace
|
23.5
|
%
|
|
22.0
|
%
|
|
1.5 pts
|
|
|
21.5
|
%
|
|
0.5 pts
|
|
Analysis of Operations
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Calculation of Adjusted EBIT Return On Invested Capital (trailing four quarters):
|
|
|
|
|
|
||||||
Adjusted EBIT
|
$
|
626.2
|
|
|
$
|
550.8
|
|
|
$
|
558.2
|
|
Invested Capital:
|
|
|
|
|
|
||||||
Trade accounts receivable
|
481.1
|
|
|
481.8
|
|
|
490.4
|
|
|||
Inventories
|
332.8
|
|
|
295.3
|
|
|
283.6
|
|
|||
Accounts payable
|
(255.3
|
)
|
|
(262.5
|
)
|
|
(252.0
|
)
|
|||
|
558.6
|
|
|
514.6
|
|
|
522.0
|
|
|||
Other current assets (excluding income taxes)
|
76.9
|
|
|
81.2
|
|
|
62.4
|
|
|||
Properties and equipment, net
|
833.5
|
|
|
829.9
|
|
|
770.5
|
|
|||
Goodwill
|
452.9
|
|
|
457.5
|
|
|
196.7
|
|
|||
Technology and other intangible assets, net
|
288.0
|
|
|
315.5
|
|
|
82.7
|
|
|||
Investment in unconsolidated affiliate
|
113.1
|
|
|
96.2
|
|
|
85.5
|
|
|||
Other assets (excluding capitalized financing fees)
|
23.0
|
|
|
40.0
|
|
|
24.5
|
|
|||
Other current liabilities (excluding income taxes, environmental remediation related to asbestos and divested businesses, Chapter 11, restructuring, and accrued interest)
|
(256.7
|
)
|
|
(248.0
|
)
|
|
(251.9
|
)
|
|||
Other liabilities (excluding environmental remediation related to asbestos and divested businesses)
|
(81.8
|
)
|
|
(72.7
|
)
|
|
(55.5
|
)
|
|||
Total invested capital
|
$
|
2,007.5
|
|
|
$
|
2,014.2
|
|
|
$
|
1,436.9
|
|
Adjusted EBIT Return On Invested Capital
|
31.2
|
%
|
|
27.3
|
%
|
|
38.8
|
%
|
(A)
|
Grace's segment operating income includes only Grace's share of income of consolidated and unconsolidated joint ventures.
|
(B)
|
Certain pension costs include only ongoing costs recognized quarterly, which include service and interest costs, expected returns on plan assets, and amortization of prior service costs/credits. Catalysts Technologies, Materials Technologies, and Construction Products segment operating income and corporate costs do not include any amounts for pension expense. Other pension related costs including annual mark-to-market adjustments and actuarial gains and losses are excluded from Adjusted EBIT. These amounts are not used by management to evaluate the performance of Grace's businesses and significantly affect the peer-to-peer and period-to-period comparability of our financial results. Mark-to-market adjustments and actuarial gains and losses relate primarily to changes in financial market values and actuarial assumptions and are not directly related to the operation of Grace's businesses.
|
|
2014 as a Percentage Increase (Decrease) from 2013
|
||||||||||
Net Sales Variance Analysis
|
Volume
|
|
Price
|
|
Currency
Translation
|
|
Total
|
||||
Catalysts Technologies
|
12.8
|
%
|
|
(2.0
|
)%
|
|
0.1
|
%
|
|
10.9
|
%
|
Materials Technologies
|
1.4
|
%
|
|
1.0
|
%
|
|
(1.0
|
)%
|
|
1.4
|
%
|
Construction Products
|
4.3
|
%
|
|
2.5
|
%
|
|
(2.3
|
)%
|
|
4.5
|
%
|
Net sales
|
6.7
|
%
|
|
0.4
|
%
|
|
(1.1
|
)%
|
|
6.0
|
%
|
By Region:
|
|
|
|
|
|
|
|
||||
North America
|
10.3
|
%
|
|
(0.1
|
)%
|
|
(0.2
|
)%
|
|
10.0
|
%
|
Europe Middle East Africa
|
1.2
|
%
|
|
(0.6
|
)%
|
|
0.2
|
%
|
|
0.8
|
%
|
Asia Pacific
|
11.5
|
%
|
|
(0.3
|
)%
|
|
(1.7
|
)%
|
|
9.5
|
%
|
Latin America
|
4.2
|
%
|
|
6.2
|
%
|
|
(6.1
|
)%
|
|
4.3
|
%
|
|
2013 as a Percentage Increase (Decrease) from 2012
|
||||||||||
Net Sales Variance Analysis
|
Volume
|
|
Price
|
|
Currency
Translation
|
|
Total
|
||||
Catalysts Technologies
|
(3.2
|
)%
|
|
(9.0
|
)%
|
|
0.8
|
%
|
|
(11.4
|
)%
|
Materials Technologies
|
0.8
|
%
|
|
2.1
|
%
|
|
(1.1
|
)%
|
|
1.8
|
%
|
Construction Products
|
3.7
|
%
|
|
1.9
|
%
|
|
(2.3
|
)%
|
|
3.3
|
%
|
Net sales
|
0.2
|
%
|
|
(2.4
|
)%
|
|
(0.8
|
)%
|
|
(3.0
|
)%
|
By Region:
|
|
|
|
|
|
|
|
||||
North America
|
3.3
|
%
|
|
(4.0
|
)%
|
|
(0.1
|
)%
|
|
(0.8
|
)%
|
Europe Middle East Africa
|
(6.5
|
)%
|
|
(2.5
|
)%
|
|
1.5
|
%
|
|
(7.5
|
)%
|
Asia Pacific
|
4.4
|
%
|
|
(3.5
|
)%
|
|
(1.8
|
)%
|
|
(0.9
|
)%
|
Latin America
|
6.0
|
%
|
|
4.0
|
%
|
|
(8.0
|
)%
|
|
2.0
|
%
|
|
2014
|
||||||||||||||
(In millions, except per share amounts)
|
Pre-
Tax
|
|
Tax Effect
|
|
After-
Tax
|
|
Per
Share
|
||||||||
Diluted Earnings Per Share (GAAP)
|
|
|
|
|
|
|
|
|
|
$
|
3.63
|
|
|||
Costs related to Chapter 11
|
$
|
11.3
|
|
|
$
|
2.2
|
|
|
$
|
9.1
|
|
|
0.12
|
|
|
Asbestos-related costs
|
7.9
|
|
|
2.9
|
|
|
5.0
|
|
|
0.07
|
|
||||
Asbestos and bankruptcy-related charges, net
|
7.1
|
|
|
2.6
|
|
|
4.5
|
|
|
0.06
|
|
||||
Pension MTM adjustment and other related costs, net
|
128.3
|
|
|
46.9
|
|
|
81.4
|
|
|
1.07
|
|
||||
Gain on termination of postretirement benefits related to divested businesses
|
(15.9
|
)
|
|
(5.9
|
)
|
|
(10.0
|
)
|
|
(0.13
|
)
|
||||
Restructuring expenses and asset impairments
|
22.4
|
|
|
7.6
|
|
|
14.8
|
|
|
0.19
|
|
||||
Currency and other financial losses in Venezuela
|
1.0
|
|
|
0.3
|
|
|
0.7
|
|
|
0.01
|
|
||||
Gain on sale of product line
|
(0.2
|
)
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
—
|
|
||||
Income and expense items related to divested businesses
|
5.2
|
|
|
1.9
|
|
|
3.3
|
|
|
0.04
|
|
||||
Discrete tax items:
|
|
|
|
|
|
|
|
||||||||
Discrete tax items, including adjustments to uncertain tax positions
|
|
|
|
48.2
|
|
|
(48.2
|
)
|
|
(0.63
|
)
|
||||
Adjusted EPS (non-GAAP)
|
|
|
|
|
|
|
|
|
|
$
|
4.43
|
|
|
2013
|
||||||||||||||
(In millions, except per share amounts)
|
Pre-
Tax
|
|
Tax Effect
|
|
After-
Tax
|
|
Per
Share
|
||||||||
Diluted Earnings Per Share (GAAP)
|
|
|
|
|
|
|
|
|
|
$
|
3.30
|
|
|||
Costs related to Chapter 11
|
$
|
16.4
|
|
|
$
|
6.0
|
|
|
$
|
10.4
|
|
|
0.13
|
|
|
Asbestos-related costs
|
7.8
|
|
|
3.0
|
|
|
4.8
|
|
|
0.06
|
|
||||
Asbestos and bankruptcy-related charges, net
|
21.9
|
|
|
8.2
|
|
|
13.7
|
|
|
0.18
|
|
||||
Default interest settlement
|
129.0
|
|
|
48.3
|
|
|
80.7
|
|
|
1.04
|
|
||||
Pension MTM adjustment and other related costs, net
|
(50.6
|
)
|
|
(20.0
|
)
|
|
(30.6
|
)
|
|
(0.39
|
)
|
||||
Restructuring expenses and asset impairments
|
12.5
|
|
|
3.5
|
|
|
9.0
|
|
|
0.12
|
|
||||
Currency and other financial losses in Venezuela
|
6.9
|
|
|
—
|
|
|
6.9
|
|
|
0.09
|
|
||||
Loss on sale of product line
|
1.0
|
|
|
0.4
|
|
|
0.6
|
|
|
0.01
|
|
||||
Income and expense items related to divested businesses
|
4.1
|
|
|
1.4
|
|
|
2.7
|
|
|
0.04
|
|
||||
Discrete tax items:
|
|
|
|
|
|
|
|
||||||||
Release of valuation allowances
|
|
|
24.4
|
|
|
(24.4
|
)
|
|
(0.31
|
)
|
|||||
Discrete tax items, including adjustments to uncertain tax positions
|
|
|
|
(9.4
|
)
|
|
9.4
|
|
|
0.12
|
|
||||
Adjusted EPS (non-GAAP)
|
|
|
|
|
|
|
|
|
|
$
|
4.39
|
|
|
2012
|
|||||||||||||
(In millions, except per share amounts)
|
Pre-
Tax
|
|
Tax Effect
|
|
After-
Tax
|
|
Per
Share
|
|||||||
Diluted Earnings Per Share (GAAP)
|
|
|
|
|
|
|
|
|
|
$
|
0.52
|
|
||
Costs related to Chapter 11
|
15.6
|
|
|
$
|
3.8
|
|
|
$
|
11.8
|
|
|
0.15
|
|
|
Asbestos-related costs
|
5.0
|
|
|
1.8
|
|
|
3.2
|
|
|
0.04
|
|
|||
Asbestos and bankruptcy-related charges, net
|
384.6
|
|
|
142.3
|
|
|
242.3
|
|
|
3.18
|
|
|||
Pension MTM adjustment and other related costs, net
|
119.2
|
|
|
37.9
|
|
|
81.3
|
|
|
1.07
|
|
|||
Restructuring expenses and asset impairments
|
6.9
|
|
|
2.0
|
|
|
4.9
|
|
|
0.06
|
|
|||
Loss on sale of product line
|
0.2
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
|||
Income and expense items related to divested businesses
|
2.8
|
|
|
1.0
|
|
|
1.8
|
|
|
0.02
|
|
|||
Discrete tax items:
|
|
|
|
|
|
|
|
|||||||
Release of valuation allowances
|
|
|
44.0
|
|
|
(44.0
|
)
|
|
(0.58
|
)
|
||||
Discrete tax items, including adjustments to uncertain tax positions
|
|
|
|
(5.3
|
)
|
|
5.3
|
|
|
0.07
|
|
|||
Adjusted EPS (non-GAAP)
|
|
|
|
|
|
|
|
|
|
$
|
4.53
|
|
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Chapter 11 expenses, net of interest income
|
$
|
11.0
|
|
|
$
|
15.3
|
|
|
$
|
16.6
|
|
D&O insurance costs related to Chapter 11
|
0.1
|
|
|
0.2
|
|
|
0.3
|
|
|||
Translation effects—intercompany loans
|
4.6
|
|
|
(11.9
|
)
|
|
(5.6
|
)
|
|||
Value of currency forward contracts—intercompany loans
|
(4.5
|
)
|
|
10.9
|
|
|
3.7
|
|
|||
Certain other currency translation costs, net
|
0.1
|
|
|
1.9
|
|
|
0.6
|
|
|||
Costs related to Chapter 11
|
$
|
11.3
|
|
|
$
|
16.4
|
|
|
$
|
15.6
|
|
(a)
|
a $700 million term loan due in 2021, with interest at LIBOR +225 bps with a 75 bps floor;
|
(b)
|
a €150 million term loan due in 2021, with interest at EURIBOR +250 bps with a 75 bps floor;
|
(c)
|
a $400 million revolving credit facility due in 2019, with interest at LIBOR +175 bps; and
|
(d)
|
a $250 million delayed draw term loan facility available for 12 months, with amounts drawn due in 2021, with interest at LIBOR +225 bps with a 75 bps floor.
|
•
|
$700 million in aggregate principal amount of notes due 2021 at a coupon rate of 5.125%; and
|
•
|
$300 million in aggregate principal amount of notes due 2024 at a coupon rate of 5.625%.
|
Credit Facilities
(In millions)
|
Maximum
Borrowing
Amount
|
|
Available
Liquidity
|
|
Expiration Date
|
||||
Country
|
|
|
|
|
|
||||
Germany
|
$
|
61.0
|
|
|
$
|
3.7
|
|
|
12/31/2015
|
Other countries
|
129.8
|
|
|
64.0
|
|
|
Various through 2015
|
||
Total
|
$
|
190.8
|
|
|
$
|
67.7
|
|
|
|
|
Year Ended December 31,
|
||||||||||
(In millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Net cash (used for) provided by operating activities
|
$
|
(1,472.1
|
)
|
|
$
|
515.9
|
|
|
$
|
453.6
|
|
Net cash provided by (used for) investing activities
|
235.3
|
|
|
(880.7
|
)
|
|
(280.3
|
)
|
|||
Net cash provided by (used for) financing activities
|
849.9
|
|
|
(8.4
|
)
|
|
110.3
|
|
|||
Effect of currency exchange rate changes on cash and cash equivalents
|
(20.4
|
)
|
|
1.1
|
|
|
5.0
|
|
|||
(Decrease) increase in cash and cash equivalents
|
(407.3
|
)
|
|
(372.1
|
)
|
|
288.6
|
|
|||
Cash and cash equivalents, beginning of period
|
964.8
|
|
|
1,336.9
|
|
|
1,048.3
|
|
|||
Cash and cash equivalents, end of period
|
$
|
557.5
|
|
|
$
|
964.8
|
|
|
$
|
1,336.9
|
|
|
Payments Due by Period
|
||||||||||||||||||
(In millions)
|
Total
|
|
Less than
1 Year
|
|
1-3
Years
|
|
4-5
Years
|
|
More Than 5 Years
|
||||||||||
Debt
|
$
|
2,015.8
|
|
|
$
|
96.8
|
|
|
$
|
56.1
|
|
|
$
|
25.4
|
|
|
$
|
1,837.5
|
|
Expected interest payments on debt(1)
|
626.7
|
|
|
92.9
|
|
|
172.4
|
|
|
169.5
|
|
|
191.9
|
|
|||||
Operating lease obligations
|
90.2
|
|
|
23.7
|
|
|
30.9
|
|
|
12.6
|
|
|
23.0
|
|
|||||
Operating commitments(2)
|
74.9
|
|
|
40.6
|
|
|
25.1
|
|
|
9.2
|
|
|
—
|
|
|||||
Capital lease obligations
|
0.7
|
|
|
0.5
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|||||
Pension funding requirements per ERISA(3)
|
0.5
|
|
|
—
|
|
|
—
|
|
|
0.5
|
|
|
—
|
|
|||||
Pension funding requirements for non-U.S. pension plans(4)
|
70.2
|
|
|
13.5
|
|
|
27.5
|
|
|
29.2
|
|
|
—
|
|
|||||
Total Contractual Obligations
|
$
|
2,879.0
|
|
|
$
|
268.0
|
|
|
$
|
312.2
|
|
|
$
|
246.4
|
|
|
$
|
2,052.4
|
|
(1)
|
Amounts are based on current interest rates as of
December 31, 2014
, for principal debt outstanding as of
December 31, 2014
.
|
(2)
|
Amounts do not include open purchase commitments, which are routine in nature and normally settle within 90 days, or obligations to employees under annual or long-term incentive programs.
|
(3)
|
Based on the U.S. qualified pension plans' status as of
December 31, 2014
, minimum funding requirements under ERISA have been estimated for the next five years. Amounts in subsequent years or additional payments have not yet been determined.
|
(4)
|
Based on the non-U.S. pension plans' status as of
December 31, 2014
, funding requirements have been estimated for the next five years. Amounts in subsequent years have not yet been determined.
|
Funded Status of Pension Plans
|
Fully-Funded
Pension Plans(1)
|
|
Underfunded
Pension Plans(1)
|
|
Unfunded
Pension Plans(2)
|
||||||||||||||||||
(In millions)
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||||||
Projected benefit obligation
|
$
|
245.8
|
|
|
$
|
247.3
|
|
|
$
|
1,388.3
|
|
|
$
|
1,253.9
|
|
|
$
|
393.6
|
|
|
$
|
372.0
|
|
Fair value of plan assets
|
289.9
|
|
|
264.0
|
|
|
1,308.8
|
|
|
1,187.7
|
|
|
—
|
|
|
—
|
|
||||||
Funded status (PBO basis)
|
$
|
44.1
|
|
|
$
|
16.7
|
|
|
$
|
(79.5
|
)
|
|
$
|
(66.2
|
)
|
|
$
|
(393.6
|
)
|
|
$
|
(372.0
|
)
|
Benefits paid
|
$
|
(12.3
|
)
|
|
$
|
(10.0
|
)
|
|
$
|
(74.4
|
)
|
|
$
|
(77.8
|
)
|
|
$
|
(43.5
|
)
|
|
$
|
(13.5
|
)
|
(1)
|
Plans intended to be advance-funded.
|
(2)
|
Plans intended to be pay-as-you-go.
|
(1)
|
Excludes benefit payments of approximately
$28 million
which were paid from a U.S. nonqualified pension plan in connection with our emergence from bankruptcy.
|
(a)
|
CENCOEX (successor of CADIVI): 6.3 bolivars to 1 U.S. dollar (fixed, official rate);
|
(b)
|
SICAD1: 12.0 bolivars to 1 U.S. dollar (variable);
|
(c)
|
SICAD2: 50.0 bolivars to 1 U.S. dollar (variable).
|
Change in Assumption
(In millions)
|
Effect on 2015
Pre-Tax Pension
Expense
|
|
Effect on December 31, 2014 PBO
|
||||
25 basis point decrease in discount rate
|
$
|
(1
|
)
|
|
$
|
45
|
|
25 basis point increase in discount rate
|
1
|
|
|
(42
|
)
|
||
25 basis point decrease in expected return on plan assets
|
3
|
|
|
—
|
|
||
25 basis point increase in expected return on plan assets
|
(3
|
)
|
|
—
|
|
|
Deferred Tax Asset
(Net of Liabilities)
|
|
Valuation Allowance
|
|
Net Deferred Tax Asset(2)
|
||||||
United States—Federal(1)
|
$
|
740.6
|
|
|
$
|
(2.4
|
)
|
|
$
|
738.2
|
|
United States—States(1)
|
51.1
|
|
|
(5.9
|
)
|
|
45.2
|
|
|||
Germany
|
40.8
|
|
|
—
|
|
|
40.8
|
|
|||
Other Foreign
|
6.6
|
|
|
(4.2
|
)
|
|
2.4
|
|
|||
Total
|
$
|
839.1
|
|
|
$
|
(12.5
|
)
|
|
$
|
826.6
|
|
(1)
|
The U.S. Federal deductions generated during 2014 relating to emergence of $670 million and settlement of the PI deferred payment obligation of $632 million, plus the $490 million warrant repurchase on February 3, 2015, and the $30 million ZAI PD deferred payment obligation, account for a significant portion of the U.S. federal and state deferred tax assets.
|
(2)
|
The noncurrent deferred tax asset of
$612.0 million
reflected in the
December 31, 2014
, Consolidated Balance Sheet is net of
$5.7 million
of income tax contingencies related to these deferred tax assets.
|
|
Expiration Dates
|
United States—Federal
|
2034 - 2035
|
United States—States
|
2014 - 2035
|
Brazil
|
Unlimited Carryforward
|
Description
|
Balance at beginning of period
|
|
Additions charged to costs and expenses
|
|
Deductions
|
|
Other,
net(1)
|
|
Balance at end of period
|
||||||||||
Valuation and qualifying accounts deducted from assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowances for notes and accounts receivable
|
$
|
7.6
|
|
|
$
|
2.5
|
|
|
$
|
(4.9
|
)
|
|
$
|
0.5
|
|
|
$
|
5.7
|
|
Valuation allowance for deferred tax assets(2)
|
18.3
|
|
|
1.2
|
|
|
(7.0
|
)
|
|
—
|
|
|
12.5
|
|
|||||
Reserves:
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserves for asbestos-related litigation
|
2,092.4
|
|
|
—
|
|
|
(2,092.4
|
)
|
|
—
|
|
|
—
|
|
|||||
Reserves for environmental remediation
|
134.5
|
|
|
14.7
|
|
|
(87.5
|
)
|
|
—
|
|
|
61.7
|
|
|||||
Reserves for retained obligations of divested businesses
|
35.0
|
|
|
—
|
|
|
(21.5
|
)
|
|
—
|
|
|
13.5
|
|
Description
|
Balance at beginning of period
|
|
Additions charged to costs and expenses
|
|
Deductions
|
|
Other,
net(1)
|
|
Balance at end of period
|
||||||||||
Valuation and qualifying accounts deducted from assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowances for notes and accounts receivable
|
$
|
6.9
|
|
|
$
|
2.2
|
|
|
$
|
(1.6
|
)
|
|
$
|
0.1
|
|
|
$
|
7.6
|
|
Valuation allowance for deferred tax assets(3)
|
40.8
|
|
|
4.4
|
|
|
(24.4
|
)
|
|
(2.5
|
)
|
|
18.3
|
|
|||||
Reserves:
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserves for asbestos-related litigation
|
2,065.0
|
|
|
27.4
|
|
|
—
|
|
|
—
|
|
|
2,092.4
|
|
|||||
Reserves for environmental remediation
|
140.5
|
|
|
8.0
|
|
|
(14.0
|
)
|
|
—
|
|
|
134.5
|
|
|||||
Reserves for retained obligations of divested businesses
|
34.2
|
|
|
0.8
|
|
|
—
|
|
|
—
|
|
|
35.0
|
|
Description
|
Balance at beginning of period
|
|
Additions charged to costs and expenses
|
|
Deductions
|
|
Other,
net(1)
|
|
Balance at end of period
|
||||||||||
Valuation and qualifying accounts deducted from assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowances for notes and accounts receivable
|
$
|
9.8
|
|
|
$
|
1.9
|
|
|
$
|
(4.8
|
)
|
|
$
|
—
|
|
|
$
|
6.9
|
|
Valuation allowance for deferred tax assets(4)
|
100.8
|
|
|
—
|
|
|
(60.0
|
)
|
|
—
|
|
|
40.8
|
|
|||||
Reserves:
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserves for asbestos-related litigation
|
1,700.0
|
|
|
365.0
|
|
|
—
|
|
|
—
|
|
|
2,065.0
|
|
|||||
Reserves for environmental remediation
|
149.9
|
|
|
3.6
|
|
|
(13.0
|
)
|
|
—
|
|
|
140.5
|
|
|||||
Reserves for retained obligations of divested businesses
|
33.7
|
|
|
0.7
|
|
|
(0.2
|
)
|
|
—
|
|
|
34.2
|
|
(1)
|
Various miscellaneous adjustments against reserves and effects of currency translation.
|
(2)
|
The valuation allowance decreased
$5.8 million
from
December 31, 2013
, to
December 31, 2014
. The decrease was primarily due to a reduction in the valuation allowance on state NOL carryforwards, partially offset by an increase in the valuation allowance on NOLs in certain foreign jurisdictions.
|
(3)
|
In the 2013 fourth quarter, Grace determined that it is more likely than not that its deductions generated at emergence will be used before their expiration. Grace recorded a
$24.4
million release of its valuation allowance on its state deferred tax assets. Further decreases resulted from the utilization and expiration of state NOLs and the reduction of NOLs resulting from prior-year adjustments to taxable income. These decreases were partially offset by the recording of valuation allowances on deferred tax assets associated with certain U.S. federal foreign tax credits.
|
(4)
|
The reduction in the valuation allowance during 2012 related in part to a
$44.0 million
release of the valuation allowance as Grace determined that it is more likely than not that a substantial portion of its state net operating losses will be used before their expiration; the remainder related to the utilization and expiration of state NOLs in the current year and the reduction of NOLs resulting from prior-year adjustments made to income by the Internal Revenue Service.
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
||||||||||
Net income attributable to W. R. Grace & Co. shareholders
|
|
$
|
276.3
|
|
|
$
|
256.1
|
|
|
$
|
40.0
|
|
|
$
|
219.7
|
|
|
$
|
193.8
|
|
Provision for (benefit from) income taxes
|
|
57.0
|
|
|
102.9
|
|
|
(61.6
|
)
|
|
87.9
|
|
|
26.2
|
|
|||||
Equity in earnings of unconsolidated affiliate
|
|
(19.7
|
)
|
|
(22.9
|
)
|
|
(18.5
|
)
|
|
(15.2
|
)
|
|
(17.8
|
)
|
|||||
Distributed income of earnings of unconsolidated affiliate
|
|
11.2
|
|
|
2.8
|
|
|
6.3
|
|
|
10.9
|
|
|
0.5
|
|
|||||
Interest expense and related financing costs, including amortization of capitalized interest, less interest capitalized
|
|
127.4
|
|
|
43.9
|
|
|
46.8
|
|
|
43.6
|
|
|
41.7
|
|
|||||
Estimated amount of rental expense deemed to represent the interest factor
|
|
9.4
|
|
|
8.8
|
|
|
7.5
|
|
|
6.9
|
|
|
6.9
|
|
|||||
Income as adjusted
|
|
$
|
461.6
|
|
|
$
|
391.6
|
|
|
$
|
20.5
|
|
|
$
|
353.8
|
|
|
$
|
251.3
|
|
Combined fixed charges and preferred stock dividends:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense and related financing costs, including capitalized interest
|
|
$
|
128.7
|
|
|
$
|
45.0
|
|
|
$
|
46.9
|
|
|
$
|
43.6
|
|
|
$
|
41.3
|
|
Estimated amount of rental expense deemed to represent the interest factor
|
|
9.4
|
|
|
8.8
|
|
|
7.5
|
|
|
6.9
|
|
|
6.9
|
|
|||||
Fixed charges
|
|
138.1
|
|
|
53.8
|
|
|
54.4
|
|
|
50.5
|
|
|
48.2
|
|
|||||
Combined fixed charges and preferred stock dividends
|
|
$
|
138.1
|
|
|
$
|
53.8
|
|
|
$
|
54.4
|
|
|
$
|
50.5
|
|
|
$
|
48.2
|
|
Ratio of earnings to fixed charges
|
|
3.34
|
|
|
7.28
|
|
|
—
|
|
|
7.01
|
|
|
5.21
|
|
|||||
Ratio of earnings to fixed charges and preferred stock dividends
|
|
3.34
|
|
|
7.28
|
|
|
—
|
|
|
7.01
|
|
|
5.21
|
|
(1)
|
Grace did not have preferred stock from
2010
through
2014
.
|
(2)
|
The
2012
ratio of earnings to fixed charges is below a one-to-one ratio. An additional $
33.9
million in earnings would be needed to attain a one-to-one ratio.
|
1.
|
I have reviewed this annual report on Form 10-K of W. R. Grace & Co.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
/s/ A. E. FESTA
|
|
|
A. E. Festa
Chief Executive Officer
|
1.
|
I have reviewed this annual report on Form 10-K of W. R. Grace & Co.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
/s/ HUDSON LA FORCE III
|
|
|
Hudson La Force III
Senior Vice President and Chief Financial Officer
|
/s/ A. E. FESTA
|
|
|
Chief Executive Officer
|
|
|
|
|
|
/s/ HUDSON LA FORCE III
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
Date: 2/25/2015
|
|
|
|
Fred Festa
Chairman and Chief Executive Officer
W. R. Grace & Co.-Conn.
7500 Grace Drive
Columbia, MD 21044
|
1.
|
Your initial annual base salary as Vice President – Government Relations & EHS will be $350,000. Thereafter, your base salary will be subject to periodic reviews on the same basis and at the same intervals as are applicable to other officers of the Company.
|
2.
|
You will participate in the Company's Annual Incentive Compensation Program (the “AICP”) for 2014. For that calendar year, your targeted award under the Program will be 70% of your base salary earnings during 2014, based on the applicable financial performance of the Company and your personal achievement during that year, subject to the terms of the following paragraphs. The cash payment you actually receive under the Program for 2014 (your “2014 AICP Payment”) will be paid to you in March 2015 at the same time other Program participants receive their payments for 2014, subject to the paragraphs below.
|
3.
|
You will be eligible for a targeted award under the Company’s Long-Term Incentive Plan (the “LTIP”) for the 2013-2015 performance period. Under that LTIP, 50 percent of the total targeted award will be in the form of “performance based units” (“PBUs”), which will be settled in cash (or stock, if appropriate), in early 2016, based on the performance of the Company’s common stock and “EBIT” during the 3-year 2013-2015 performance period ending December 31, 2015; and 50 percent will be in the form of a stock option grant.
|
4.
|
Consistent with your election as an officer of the Company, the Board has authorized the Company to enter into a written Executive Severance Agreement, or a so-called “golden parachute”, with you. In general, the terms of that agreement will provide for a severance payment of 3.00 times the sum of your annual base salary plus your targeted annual incentive compensation award (adjusted in accordance with the terms of that agreement), and certain other benefits, in the event your employment terminates under certain conditions following a change-in-control of the Company. The form and provisions of your Executive Severance Agreement will be the same as applicable to other elected officers of the Company. Please refer to the Executive Severance Agreement itself for definition of “change in control”, “employment termination” and other particulars of this arrangement.
|
•
|
The W. R. Grace & Co. Retirement Plan for Salaried Employees (“Grace Salaried Retirement Plan”)
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
||||||||||
Net income attributable to W. R. Grace & Co. shareholders
|
|
$
|
276.3
|
|
|
$
|
256.1
|
|
|
$
|
40.0
|
|
|
$
|
219.7
|
|
|
$
|
193.8
|
|
Provision for (benefit from) income taxes
|
|
57.0
|
|
|
102.9
|
|
|
(61.6
|
)
|
|
87.9
|
|
|
26.2
|
|
|||||
Equity in earnings of unconsolidated affiliate
|
|
(19.7
|
)
|
|
(22.9
|
)
|
|
(18.5
|
)
|
|
(15.2
|
)
|
|
(17.8
|
)
|
|||||
Distributed income of earnings of unconsolidated affiliates
|
|
11.2
|
|
|
2.8
|
|
|
6.3
|
|
|
10.9
|
|
|
0.5
|
|
|||||
Interest expense and related financing costs, including amortization of capitalized interest, less interest capitalized
|
|
127.4
|
|
|
43.9
|
|
|
46.8
|
|
|
43.6
|
|
|
41.7
|
|
|||||
Estimated amount of rental expense deemed to represent the interest factor
|
|
9.4
|
|
|
8.8
|
|
|
7.5
|
|
|
6.9
|
|
|
6.9
|
|
|||||
Income as adjusted
|
|
$
|
461.6
|
|
|
$
|
391.6
|
|
|
$
|
20.5
|
|
|
$
|
353.8
|
|
|
$
|
251.3
|
|
Combined fixed charges and preferred stock dividends:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense and related financing costs, including capitalized interest
|
|
$
|
128.7
|
|
|
$
|
45.0
|
|
|
$
|
46.9
|
|
|
$
|
43.6
|
|
|
$
|
41.3
|
|
Estimated amount of rental expense deemed to represent the interest factor
|
|
9.4
|
|
|
8.8
|
|
|
7.5
|
|
|
6.9
|
|
|
6.9
|
|
|||||
Fixed charges
|
|
138.1
|
|
|
53.8
|
|
|
54.4
|
|
|
50.5
|
|
|
48.2
|
|
|||||
Combined fixed charges and preferred stock dividends
|
|
$
|
138.1
|
|
|
$
|
53.8
|
|
|
$
|
54.4
|
|
|
$
|
50.5
|
|
|
$
|
48.2
|
|
Ratio of earnings to fixed charges
|
|
3.34
|
|
|
7.28
|
|
|
—
|
|
|
7.01
|
|
|
5.21
|
|
|||||
Ratio of earnings to fixed charges and preferred stock dividends
|
|
3.34
|
|
|
7.28
|
|
|
—
|
|
|
7.01
|
|
|
5.21
|
|
(1)
|
Grace did not have preferred stock from
2010
through
2014
.
|
SUBSIDIARY NAME
|
STATE OF INCORPORATION
|
Alltech Associates, Inc.
|
IL
|
AP Chem Incorporated
|
MD
|
Construction Products Dubai, Inc.
|
DE
|
Darex Puerto Rico, Inc.
|
DE
|
De Neef Construction Chemicals (US) Inc.
|
TX
|
Dewey and Almy, LLC
|
DE
|
Gloucester New Communities Company, Inc.
|
NJ
|
Grace Chemicals, Inc.
|
DE
|
Grace Chemical Company of Cuba
|
IL
|
Grace Collections, Inc.
|
DE
|
Grace Energy Corporation
|
DE
|
Grace Europe, Inc.
|
DE
|
Grace Management Services, Inc.
|
DE
|
Grace PAR Corporation
|
DE
|
Grace Technologies, Inc.
(f/k/a Grace Asia Pacific, Inc.)
|
DE
|
Guanica-Caribe Land Development Corporation
|
DE
|
Hanover Square Corporation
|
DE
|
Kootenai Development Company
|
MT
|
Verifi LLC
(f/k/a GR 2008 LLC)
|
DE
|
Water Street Corporation
|
DE
|
W. R. Grace Capital Corporation
|
NY
|
W. R. Grace & Co.-Conn.
|
CT
|
W. R. Grace Land Corporation
|
NY
|
COUNTRY/
SUBSIDIARY NAME
|
ABU DHABI AND UNITED ARAB EMIRATES
|
Grace FCC Catalysts Middle East LLC
|
ABU DHABI FREE ZONE
|
Grace Refining Technologies Middle East Trading Ltd.
|
ARGENTINA
|
W. R. Grace Argentina S.A.
|
AUSTRALIA
|
Alltech Associates (Australia) Pty. Ltd.
|
Grace Australia Pty. Ltd.
|
BELGIUM
|
De Neef Construction Chemicals BVBA (Belgium)
|
Grace Construction Products N.V.
|
Grace N.V./S.A.
|
Inverco Benelux N.V.
|
BRAZIL
|
Grace Brasil Ltda.
|
Grace Davison Ltda.
|
CANADA
|
GEC Divestment Corporation Ltd.
|
Grace Canada, Inc.
|
W. R. Grace Finance (NRO) Ltd.
|
CHILE
|
Grace Quimica Compania Limitada
|
CHINA - PEOPLE’S REPUBLIC OF
|
Grace China Ltd.
|
Grace Trading (Shanghai) Co. Ltd.
|
Grace Catalysts (Qingdao) Company Limited
|
COLOMBIA
|
Grace Colombia S.A.
|
CUBA
|
Envases Industriales y Comerciales, S.A.
|
Papelera Camagueyana, S.A.
|
FRANCE
|
Alltech France S.A.R.L.
|
De Neef France S.A.R.L.
|
Grace Produits de Construction SAS
|
W. R. Grace S.A.
|
GERMANY
|
Alltech Grom GmbH
|
De Neef Deutschland GmbH
|
Grace Bauprodukte GmbH
|
Grace Darex GmbH
|
COUNTRY/
SUBSIDIARY NAME
|
Grace Germany GmbH
(f/k/a Grace Energy GmbH)
|
Grace Europe Holding GmbH
|
Grace GmbH & Co. KG
|
Grace GP GmbH
|
Grace Management GP GmbH
|
Grace Silica GmbH
|
GREECE
|
Grace Hellas E.P.E.
|
HONG KONG
|
Alltech Applied Science Labs (HK) Limited
|
Alltech Scientific (China) Limited
|
De Neef Construction Chemicals (China) Limited.
|
W. R. Grace (Hong Kong) Limited
|
HUNGARY
|
Grace Értékesito Kft.
|
INDIA
|
Grace Davison Chemicals India Pvt. Ltd.
(f/k/a Flexit Laboratories Private Ltd.)
|
W. R. Grace & Co. (India) Private Limited
|
INDONESIA
|
PT. Grace Specialty Chemicals Indonesia
|
IRELAND
|
Amicon Ireland Limited
|
Grace Construction Products (Ireland) Limited
|
Grace European Finance (Dublin) Limited
|
ITALY
|
Alltech Italia S.R.L.
|
W. R. Grace Italiana S.p.A.
|
JAPAN
|
Grace Chemicals Kabushiki Kaisha
|
Grace Japan Kabushiki Kaisha
|
KOREA
|
Grace Korea Inc.
|
LUXEMBOURG
|
Grace Luxembourg S.a.r.l.
|
MALAYSIA
|
W. R. Grace (Malaysia) Sendiran Berhad
|
W. R. Grace Specialty Chemicals (Malaysia) Sdn. Bhd.
|
MEXICO
|
Grace Container, S.A. de C.V.
|
W. R. Grace Holdings, S.A. de C.V.
|
NETHERLANDS
|
Alltech Applied Science B.V.
|
Denac Nederland B.V.
|
COUNTRY/
SUBSIDIARY NAME
|
Grace Netherlands B.V.
|
LC Service B.V.
|
NEW ZEALAND
|
Grace (New Zealand) Limited
|
PANAMA
|
W. R. Grace (Panama) S.A.
|
PHILIPPINES
|
W. R. Grace (Philippines), Inc.
|
W.R. Grace Operations Center, Inc.
|
POLAND
|
Grace Sp. z o.o.
|
PORTUGAL
|
Grace Portugal, LDA
|
RUSSIA
|
Grace CIS LLC
|
SINGAPORE
|
De Neef Asia Pte. Ltd. (Singapore)
|
W. R. Grace (Singapore) Private Limited
|
SOUTH AFRICA
|
Grace Davison (Proprietary) Limited
|
W. R. Grace Africa (Proprietary) Limited
|
SPAIN
|
De Neef Technologies S.L.
|
Grace, S.A.
|
SWEDEN
|
De Neef Scandinavia AB
|
Grace AB
|
Grace Catalyst AB
|
Grace Sweden AB
|
SWITZERLAND
|
De Neef (CH) AG
|
Grace Construction Products S.A.
(f/k/a Pieri S.A.)
|
Union Financière S.A.
|
TAIWAN
|
W. R. Grace Taiwan, Inc.
|
THAILAND
|
W. R. Grace (Thailand) Limited
|
TURKEY
|
Grace Özel Inşaat Malzemeleri Sanayi Ve Ticaret Anonim Şirketi
|
UNITED KINGDOM
|
Alltech Associates Applied Science Limited
|
Darex UK Limited
|
De Neef UK Ltd.
|
COUNTRY/
SUBSIDIARY NAME
|
Exemere Limited
|
Grace Construction Products Limited
|
W. R. Grace Limited
|
VENEZUELA
|
Grace Venezuela, S.A.
|
VIETNAM
|
W. R. Grace Vietnam Company Limited
|
H. Furlong Baldwin
|
/s/ H. Furlong Baldwin
|
Ronald C. Cambre
|
/s/ Ronald C. Cambre
|
Robert F. Cummings, Jr.
|
/s/ Robert F. Cummings, Jr.
|
Marye Anne Fox
|
/s/ Marye Anne Fox
|
Diane H. Gulyas
|
/s/ Diane H. Gulyas
|
Janice K. Henry
|
/s/ Janice K. Henry
|
Jeffry N. Quinn
|
/s/ Jeffry N. Quinn
|
Christopher J. Steffen
|
/s/ Christopher J. Steffen
|
Mark E. Tomkins
|
/s/ Mark E. Tomkins
|
1.
|
I have reviewed this annual report on Form 10-K of W. R. Grace & Co.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
/s/ A. E. FESTA
|
|
|
A. E. Festa
Chief Executive Officer
|
1.
|
I have reviewed this annual report on Form 10-K of W. R. Grace & Co.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
/s/ HUDSON LA FORCE III
|
|
|
Hudson La Force III
Senior Vice President and Chief Financial Officer
|
/s/ A. E. FESTA
|
|
|
Chief Executive Officer
|
|
|
|
|
|
/s/ HUDSON LA FORCE III
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
Date: 2/25/2015
|
|
|
Mine
|
|
§104 S&S
*
Citations
(#)
|
|
§104(b) Orders
(#)
|
|
§104(d) Citations and Orders
(#)
|
|
§110(b)(2) Violations
(#)
|
|
§107(a) Orders
(#)
|
|
Total Dollar Value of MSHA Assessments Proposed
($)
|
|
Total Number of Mining-Related Fatalities
(#)
|
|
Received Written Notice of Pattern of S&S* Violations under §104(e)
(yes/no)
|
|
Received Notice of Potential to have Pattern of S&S* Violations under §104(e)
(yes/no)
|
Clay Mine
Aiken, SC
|
|
5
|
|
—
|
|
—
|
|
—
|
|
—
|
|
346
|
|
—
|
|
No
|
|
No
|
*
|
S&S refers to violations of mandatory health or safety standards that could significantly and substantially contribute to the cause and effect of a coal or other mine safety or health hazard under §104 of the Mine Act.
|
Mine
|
|
Pending as of
December 31, 2014
(#)
|
|
Instituted during fiscal year 2014
(#)
|
|
Resolved during fiscal year 2014
(#)
|
Clay Mine
Aiken, SC
|
|
—
|
|
—
|
|
—
|
*
|
29 CFR part 2700.
|