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þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Kentucky
(State or other jurisdiction of incorporation or organization)
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20-0865835
(I.R.S. Employer Identification No.)
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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, par value $.01 per share
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New York Stock Exchange
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Large Accelerated Filer
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Accelerated Filer
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Non-Accelerated Filer
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Smaller Reporting Company
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(Do not check if a smaller reporting company)
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Page
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PART I
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Item 1.
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Business
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General
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Corporate Developments
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Ashland Specialty Ingredients
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Ashland Performance Materials
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Valvoline
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Miscellaneous
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Item 1A.
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Risk Factors
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Item 1B.
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Unresolved Staff Comments
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Item 2.
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Properties
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Item 3.
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Legal Proceedings
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Item 4.
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Mine Safety Disclosures
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Item X.
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Executive Officers of Ashland
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PART II
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Item 5.
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Market for Registrant’s Common Equity, Related Stockholder Matters and Purchases of
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Equity Securities
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Item 6.
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Selected Financial Data
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Item 7.
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Management’s Discussion and Analysis of Financial
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Condition and Results of Operation
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Item 7A.
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Quantitative and Qualitative Disclosures about Market Risk
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Item 8.
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Financial Statements and Supplementary Data
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Item 9.
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Changes in and Disagreements with Accountants
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on Accounting and Financial Disclosure
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Item 9A.
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Controls and Procedures
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Item 9B.
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Other Information
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PART III
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Item 10.
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Directors, Executive Officers and Corporate Governance
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Item 11.
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Executive Compensation
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Item 12.
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Security Ownership of Certain Beneficial Owners
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and Management and Related Stockholder Matters
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Item 13.
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Certain Relationships and Related Transactions, and Director Independence
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Item 14.
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Principal Accounting Fees and Services
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PART IV
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Item 15.
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Exhibits and Financial Statement Schedules
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•
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Oral Care – Specialty Ingredients’ portfolio of oral care products delivers active ingredients in toothpaste and mouthwashes; provides bioadhesive functionality for dentures; delivers flavor, texture and other functional properties; and provides product binding to ensure form and function throughout product lifecycle.
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•
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Hair Care – Specialty Ingredients’ portfolio of hair care products includes advanced styling polymers, fixatives, conditioning polymers, emulsifiers, preservatives and rheology modifiers.
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•
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Skin Care – Specialty Ingredients’ portfolio of skin care products helps to firm, nourish, revitalize and smooth skin. The Skin Care line also provides sun care products, including UV filters, water-resistant agents and thickeners. Emulsifiers, emollients, preservatives and rheology modifiers complete the Skin Care product line.
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•
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Home Care – Specialty Ingredients’ portfolio of products and technologies is used in many types of cleaning applications, including fabric care, home care and dishwashing. Specialty Ingredients’ products are used in a variety of applications for viscosity enhancement, particle suspension, rheology modification and stabilization.
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•
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Pharmaceutical – Specialty Ingredients is a leading supplier of excipients and tablet coating systems to the pharmaceutical and nutraceutical industries. The excipients division offers a comprehensive range of polymers for use as tablet binders, superdisintegrants, sustained-release agents and drug solubilizers, as well as a portfolio of fully formulated, one-step tablet coating systems for immediate-, sustained- and delayed-release applications.
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•
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Nutrition – Specialty Ingredients’ nutrition portfolio provides functional benefits in areas such as thickening, texture control, thermal gelation, structure enhancement, water binding, clarification and stabilization. Its core products include cellulose gums and vinyl pyrrolidone polymers which are used in a wide range of offerings for bakery, beverage, dairy, desserts, meat products, pet food, prepared foods, sauces and savory products.
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•
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Coatings – Coatings Specialties is a recognized leader in rheology solutions for waterborne architectural paint and coatings. Products include hydroxyethylcellulose (HEC), which provides thickening and application properties for interior and exterior paints, and nonionic synthetic associative thickeners (NSATs), which are APEO-free liquid synthetics for high-performance paint and industrial coatings. The Coatings Specialties market complements its rheology offering with a broad portfolio of performance foam-control agents, surfactants and wetting agents, dispersants and pH neutralizers.
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•
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Construction – Construction Specialties is a major producer and supplier of cellulose ethers and companion products for the construction industry. These products control properties such as water retention, open time, workability, adhesion, stabilization, pumping, sag resistance, rheology, strength, appearance and performance in dry-mortar formulations.
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•
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Energy – Energy Specialties is a leading global manufacturer of guar-, synthetic- and cellulosic-based products for drilling fluids, oil-well cement slurries, completion and workover fluids, fracturing fluids and production chemicals. Specialty Ingredients offers the oil and gas industry solutions for drilling, stimulation, completion, cementing and production applications.
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Adhesives – Adhesives Specialties manufactures and sells adhesive solutions to the packaging and converting, building and construction, and transportation markets and manufactures and markets specialty coatings and adhesive solutions for use across multiple industries. Key technologies and markets include: acrylic polymers for pressure-sensitive adhesives; urethane adhesive for flexible packaging applications; aqueous and radiation-curable adhesives and specialty coatings for printing and converting applications; emulsion polymer isocyanate adhesives for structural wood bonding; elastomeric polymer adhesives for commercial roofing applications; acrylic, polyurethane and epoxy structural adhesives for bonding fiberglass reinforced plastics, composites, thermoplastics and metals in automotive, marine, recreational and industrial applications; specialty phenolic resins for paper impregnation and friction material bonding. Adhesive Specialties' adhesive products provide an array of functional properties including high-strength bonding, ease and speed of product assembly, heat and moisture resistance and design flexibility.
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•
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Performance – Performance Specialties provides products and services to over 30 industries. Ashland offers a broad spectrum of organo- and water-soluble polymers that are derived from both natural and synthetic resources. Product lines include derivatized cellulose polymers, synthetics, guar and guar derivatives that impart effective functionalities to serve a variety of industrial markets and specialized applications. Many of the products within Performance Specialties function as performance additives that deliver high levels of end-user value in formulated products. In other areas, such as plastics and textiles, Performance Specialties’ products function as a processing aid, improving the quality of end products and reducing manufacturing costs.
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•
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requiring Ashland to dedicate a substantial portion of its cash flow from operations to pay principal and interest on its debt, which would reduce the availability of Ashland’s cash flow to fund working capital, capital expenditures, acquisitions, execution of its growth strategy and other general corporate purposes;
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•
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limiting Ashland’s ability to borrow additional amounts to fund working capital, capital expenditures, acquisitions, debt service requirements, execution of its growth strategy and other purposes;
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•
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making Ashland more vulnerable to adverse changes in general economic, industry and regulatory conditions and in its business by limiting Ashland’s flexibility in planning for, and making it more difficult for Ashland to react quickly to, changing conditions;
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•
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placing Ashland at a competitive disadvantage compared with those of its competitors that have less debt and lower debt service requirements;
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•
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making Ashland more vulnerable to increases in interest rates since some of its indebtedness is subject to variable rates of interest; and
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•
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making it more difficult for Ashland to satisfy its financial obligations.
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2010
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2011
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2012
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2013
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2014
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2015
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Ashland
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100
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92
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150
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197
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225
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220
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S&P MidCap 400
†
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100
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99
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127
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162
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181
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183
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Peer Group - Materials
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100
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93
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122
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143
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170
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140
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•
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Peer Group – Materials:
S&P 500
†
Materials (large-cap) and S&P MidCap 400
†
Materials. As of
September 30, 2015
, this peer group consisted of
59
companies.
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Q4 Fiscal Periods
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Total Number of Shares Purchased
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Average Price Paid per Share, including commission
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Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
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Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (in millions) (a)
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July 1, 2015 to July 31, 2015:
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$
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1,000
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2014 ASR Agreements
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563,905
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(b)
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$
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116.33
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563,905
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2015 ASR Agreements
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302,315
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(b)
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125.22
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302,315
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Employee tax withholdings
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6,447
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(c)
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119.60
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—
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August 1, 2015 to August 31, 2015
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448
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(c)
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108.47
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—
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1,000
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September 1, 2015 to September 30, 2015
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2,629
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(c)
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105.34
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—
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1,000
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Total....................................................
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875,744
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866,220
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$
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1,000
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(a)
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On April 28, 2015, Ashland’s Board of Directors approved a $1 billion share repurchase authorization that expires December 31, 2017 and allows for shares to be repurchased in privately negotiated and/or open market transactions, including under plans complying with Rule 10b5-1 of the Exchange Act. The $1 billion represents the remaining amount available for share repurchase as of September 30, 2015. On November 17, 2015, Ashland entered into an uncollared accelerated share repurchase agreement (the November 2015 ASR Agreement) with Goldman Sachs & Co. (Goldman Sachs) to repurchase an aggregate of $500 million of Ashland's common stock. Under the November 2015 ASR Agreement, Ashland has agreed to repurchase an aggregate of $500 million of its common stock from Goldman Sachs, with an initial delivery of approximately 3.9 million shares. The November 2015 ASR Agreement is scheduled to terminate no later than May 2016 but may be terminated early in certain circumstances, in whole or in part. Goldman Sachs may be required to deliver additional shares of common stock to Ashland, or under certain circumstances, Ashland may be required to deliver shares of common stock or to make a cash payment, at its election, to Goldman Sachs.
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(b)
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In August 2014, the Company entered into an accelerated share repurchase program with two financial institutions to purchase $750 million of the Company's common stock (the 2014 ASR Agreements). In exchange for an up-front payment totaling $750 million, the financial institutions initially delivered approximately 5.9 million shares of Ashland common stock. The 2014 ASR Agreements had a variable maturity, at the financial institutions’ option, with a pricing period termination date of no later than June 30, 2015. In June 2015, the 2014 ASR Agreements terminated pursuant to their terms and the pricing period was closed. The settlement price, which represents the weighted average price of Ashland’s common stock over the pricing period less a discount, was $116.33 per share. Based on this settlement price, the final number of shares repurchased by Ashland that were to be delivered by the financial institutions was 6.4 million shares. Ashland received the additional 563,905 shares from the financial institutions in the September 2015 quarter to settle the difference between the initial share delivery and the total number of shares repurchased.
Additionally, in January 2015, the Company entered into accelerated share repurchase programs to purchase $269.6 million of the Company's common stock (the 2015 ASR Agreements). In exchange for an up-front payment totaling $269.6 million, the financial institutions initially delivered approximately 1.9 million shares of Ashland common stock. The 2015 ASR Agreements had a variable maturity, at the financial institutions’ option, with a pricing period termination date of no later than July 31, 2015. In June 2015, the financial institutions exercised their early termination option under the 2015 ASR Agreements and the pricing period was closed. The settlement price, which represents the weighted average price of Ashland’s common stock over the pricing period less a discount, was $125.22 per share. Based on this settlement price, the final number of shares repurchased by Ashland that were to be delivered by the financial institutions under the 2015 ASR Agreements was 2.2 million shares. Ashland received the additional 302,315 shares from the financial institutions in the September 2015 quarter to settle the difference between the initial share delivery and the total number of shares repurchased. The average price paid by the Company for the shares delivered under the 2014 ASR Agreements and the 2015 ASR Agreements was $119.43.
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(c)
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Shares withheld from employees to cover their withholding requirements for personal income taxes related to the vesting of restricted stock.
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Equity Compensation Plan Information
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Plan Category
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Number of securities to be issued upon exercise of outstanding options, warrants and rights
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Weighted-average exercise price of outstanding options, warrants and rights
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Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
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(a)
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(b)
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(c)
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Equity compensation plans approved by security
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holders........................................................................
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830,851
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(1)
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$
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63.65
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(2)
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2,823,304
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(3)
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Equity compensation plans not approved by security
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holders........................................................................
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202,901
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(4)
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—
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685,655
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(5)
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Total.......................................................................
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1,033,752
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$
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63.65
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(2)
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3,508,959
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(1)
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This figure includes (a) 5,874 stock options outstanding under the Amended and Restated Ashland Inc. Incentive Plan (“Amended Plan”) and (b) 102 stock options outstanding under the Hercules Incorporated Amended and Restated Long Term Incentive Compensation Plan. This figure also includes 2,972 net shares that could be issued under stock-settled SARs under the Amended Plan, 183,657 net shares that could be issued under stock-settled SARs under the 2006 Ashland Inc. Incentive Plan (“2006 Incentive Plan”) and 222,055 net shares that could be issued under stock-settled SARs and 16,000 shares that could be issued under stock-settled restricted stock units under the Amended and Restated 2011 Ashland Inc. Incentive Plan (“2011 Incentive Plan”), based upon the closing price of Ashland Common Stock on the NYSE as of September 30, 2015 of $100.62. Additionally, this figure includes 151,088 restricted shares granted under the Amended Plan and deferred, 71,298 performance share units for the fiscal 2013-2015 performance period, 58,983 performance share units for the fiscal 2014-2016 performance period, and 68,592 performance share units for the fiscal 2015-2017 performance period, payable in Ashland Common Stock under the 2011 Incentive Plan, estimated assuming target performance is achieved. Also included in the figure are 31,680 shares to be issued under the pre-2005 Deferred Compensation Plan for Employees and 17,258 shares to be issued under the pre-2005 Deferred Compensation Plan for Non-Employee Directors, payable in Ashland Common Stock upon termination of employment or service with Ashland.
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(2)
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The weighted-average exercise price excludes shares in Ashland Common Stock which may be distributed under the deferred compensation plans and the deferred restricted stock and performance share units which may be distributed under the 2011 Incentive Plan, as described in footnotes (1) and (4) in this table.
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(3)
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This figure includes 2,414,128 shares available for issuance under the Amended and Restated 2015 Ashland Inc. Incentive Plan (“2015 Incentive Plan”), 144,789 shares available for issuance under the pre-2005 Deferred Compensation Plan for Employees and 264,387 shares available for issuance under the pre-2005 Deferred Compensation Plan for Non-Employee Directors. Under the 2015 Incentive Plan, full-value awards, which include all awards other than stock options and SARs, reduce the share reserve on a 2.75-to-1 basis.
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(4)
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This figure includes 31,223 shares to be issued under the Deferred Compensation Plan for Employees (2005), which is described in the “Non-Qualified Deferred Compensation-Ashland Inc. Employees’ Deferral Plan” section of Ashland’s proxy statement, and 171,678 shares to be issued under the Deferred Compensation Plan for Non-Employee Directors (2005), which is described in the “Compensation of Directors-Annual Retainer” and “Compensation of Directors-Restricted Shares/Units” sections of Ashland’s proxy statement, payable in Ashland Common Stock upon termination of employment or service with Ashland. Because these plans are not equity compensation plans as defined by the rules of the NYSE, neither plan required approval by Ashland’s shareholders.
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(5)
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This figure includes 382,741 shares available for issuance under the Deferred Compensation Plan for Employees (2005) and 302,914 shares available for issuance under the Deferred Compensation Plan for Non-Employee Directors (2005). Because these plans are not equity compensation plans as defined by the rules of the NYSE, neither plan required approval by Ashland’s shareholders. Ashland also granted Mr. Wulfsohn, its Chief Executive Officer, an employment inducement award, in compliance with Rule 303A.08 of The New York Stock Exchange Listed Company Manual, consisting of a one-time grant of time-vested restricted stock in the amount of 50,000 shares (“2015 Inducement Award”). All shares under the 2015 Inducement Award have been granted, are no longer available for future issuance and are not included in this figure.
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2.1
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–
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Stock and Asset Purchase Agreement, dated as of February 18, 2014, between Ashland Inc. and CD&R Seahawk Bidco, LLC (filed as Exhibit 2.1 to Ashland’s Form 8-K filed on February 24, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
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2.2
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–
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Sale and Purchase Agreement related to the ASK Chemicals Group, dated April 8, 2014, among Ashland Inc., Ashland International Holdings, Inc., Clariant Produkte (Deutschland) GmbH, Clariant Corp., mertus 158. GmbH, Ascot US Bidco Inc. and Ascot UK Bidco Limited (filed as Exhibit 2.1 to Ashland’s Form 8-K filed on April 14, 2014 ( SEC File No. 001-32532), and incorporated herein by reference).
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3.1
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–
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Fourth Restated Articles of Incorporation of Ashland Inc. (filed as Exhibit 3.2 to Ashland’s Form 8-K
filed on February 4, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
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3.2
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–
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By-laws of Ashland Inc., as amended and restated (filed as Exhibit 3.3 to Ashland’s Form 8-K filed on
February 4, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
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4.1
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–
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Ashland agrees to provide the SEC, upon request, copies of instruments defining the rights of holders of long-term debt of Ashland and all of its subsidiaries for which consolidated or unconsolidated financial statements are required to be filed with the SEC.
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4.2
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–
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Indenture, dated as of August 15, 1989, as amended and restated as of August 15, 1990, between Ashland Inc. and Citibank, N.A., as Trustee (filed as Exhibit 4.2 to Ashland’s Form 10-K for the fiscal year ended September 30, 2008 (SEC File No. 001-32532), and incorporated herein by reference).
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4.3
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–
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Agreement of Resignation, Appointment and Acceptance, dated as of November 30, 2006, by and among Ashland Inc., Wilmington Trust Company (Wilmington) and Citibank, N.A. (Citibank) whereby Wilmington replaced Citibank as Trustee under the Indenture dated as of August 15, 1989, as amended and restated as of August 15, 1990, between Ashland Inc. and Citibank (filed as Exhibit 4 to Ashland’s Form 10-Q for the quarter ended December 31, 2006 (SEC File No. 001-32532), and incorporated herein by reference).
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4.4
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–
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Indenture, dated May 27, 2009, by and among Ashland Inc., the Guarantors and U.S. Bank National Association (filed as Exhibit 4.1 to Ashland’s Form 10-Q for the quarter ended June 30, 2009 (SEC File No. 001-32532), and incorporated herein by reference).
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4.5
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–
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Warrant Agreement dated July 27, 1999 between Hercules and The Chase Manhattan Bank, as warrant agent (filed as Exhibit 4.4 to Hercules’ Form 8-K filed on July 28, 1999 (SEC File No. 001-00496), and incorporated herein by reference).
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4.6
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Form of Series A Junior Subordinated Deferrable Interest Debentures (filed as Exhibit 4.5 to Hercules’ Form 8-K filed on July 28, 1999 (SEC File No. 001-00496), and incorporated herein by reference).
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4.7
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–
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Form of CRESTS
SM
Unit (filed as Exhibit 4.7 to Hercules’ Form 8-K filed on July 28, 1999 (SEC File No. 001-00496), and incorporated herein by reference).
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4.8
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–
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Form of Warrant (filed as Exhibit 4.8 to Hercules’ Form 8-K filed on July 28, 1999 (SEC File No. 001-00496), and incorporated herein by reference).
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4.9
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–
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Form of $100,000,000 6.6% Debenture due August 27, 2027 (filed as Exhibit 4.2 to Hercules’ Form 8-
K filed on July 30, 1997 (SEC File No. 001-00496), and incorporated herein by reference).
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4.10
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–
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Indenture, dated as of August 7, 2012, between Ashland Inc. and U.S. Bank N.A., as Trustee (filed as Exhibit 4.1 to Ashland’s Form 8-K filed on September 21, 2012 (SEC File No. 001-32532), and incorporated herein by reference).
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4.11
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–
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First Supplemental Indenture, dated as of February 26, 2013, between Ashland Inc. and U.S. Bank National Association, as Trustee, in respect of the senior notes due 2022 (filed as Exhibit 4.11 to Ashland’s Form 10-K for the fiscal year ended September 30, 2013 (SEC File No. 001-32532), and incorporated herein by reference).
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4.12
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–
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Indenture, dated as of February 26, 2013, between Ashland Inc. and U.S. Bank National Association, as Trustee (filed as Exhibit 4.3 to Ashland’s Form 8-K filed on February 27, 2013 (SEC File No. 001- 32532), and incorporated herein by reference).
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4.13
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–
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First Supplemental Indenture, dated as of February 26, 2013, between Ashland Inc. and U.S. Bank National Association, as Trustee, in respect of the senior notes due 2016, 2018 and 2043 (filed as Exhibit 4.4 to Ashland’s Form 8-K filed on February 27, 2013 (SEC File No. 001-32532), and incorporated herein by reference).
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4.14
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–
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Second Supplemental Indenture, dated as of March 14, 2013, between Ashland Inc. and U.S. Bank National Association, as Trustee, in respect of the senior notes due 2043 (filed as Exhibit 4.2 to Ashland’s Form 8-K filed on March 18, 2013 (SEC File No. 001-32532), and incorporated herein by reference).
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10.1
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–
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Ashland Inc. Deferred Compensation Plan for Non-Employee Directors and Amendment No. 1 (filed as Exhibit 10.5 to Ashland’s Form 10-Q for the quarter ended December 31, 2004 (SEC File No. 001-02918), and incorporated herein by reference).
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10.2
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–
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Ashland Inc. Deferred Compensation Plan and Amendment No. 1 (filed as Exhibit 10.3 to Ashland’s Form 10-Q for the quarter ended December 31, 2004 (SEC File No. 001-02918), and incorporated herein by reference).
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10.3
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–
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Amended and Restated Ashland Inc. Deferred Compensation Plan for Employees (2005) (filed as Exhibit 10.3 to Ashland’s Form 10-K for the fiscal year ended September 30, 2008 (SEC File No. 001-32532), and incorporated herein by reference).
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10.4
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–
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Amended and Restated Ashland Inc. Deferred Compensation Plan for Non-Employee Directors (2005) (filed as Exhibit 10.4 to Ashland’s Form 10-K for the fiscal year ended September 30, 2008 (SEC File No. 001-32532), and incorporated herein by reference).
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10.5
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–
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Amended and Restated Ashland Inc. Supplemental Early Retirement Plan for Certain Employees (filed as Exhibit 10.5 to Ashland’s Form 10-K for the fiscal year ended September 30, 2010 (SEC File No. 001-32532), and incorporated herein by reference).
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10.6
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–
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Amendment to the Ashland Inc. Supplemental Early Retirement Plan for Certain Employees (filed as Exhibit 10.10 to Ashland’s Form 10-Q for the quarter ended June 30, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
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10.7
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–
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Amendment to the Amended and Restated Ashland Inc. Deferred Compensation Plan for Non-Employee Directors (2005) (filed as Exhibit 10.4 to Ashland’s Form 10-Q for the quarter ended March 31, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
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10.8
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–
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Ashland Supplemental Defined Contribution Plan for Certain Employees (filed as Exhibit 10.3 to Ashland’s Form 10-Q for the quarter ended March 31, 2011 (SEC File No. 001-32532), and incorporated herein by reference).
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10.9
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–
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Ashland Inc. Supplemental Defined Contribution Plan for Certain Employees effective January 1, 2015 (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on May 18, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
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10.10
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–
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Amended and Restated Ashland Inc. Nonqualified Excess Benefit Pension Plan (filed as Exhibit 10.6 to Ashland’s Form 10-K for the fiscal year ended September 30, 2008 (SEC File No. 001-32532), and incorporated herein by reference).
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10.11
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–
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Hercules Incorporated Employee Pension Restoration Plan (filed as Exhibit 10.9 to Ashland’s Form 10- K for the fiscal year ended September 30, 2010 (SEC File No. 001-32532), and incorporated herein by reference).
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10.12
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–
|
Form of Chief Executive Officer Change in Control Agreement (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on January 7, 2009 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.13
|
–
|
Form of Executive Officer Change in Control Agreement, effective for agreements entered into after July 2009 (filed as Exhibit 10.11 to Ashland’s Form 10-K for the fiscal year ended September 30, 2009 (SEC File No. 001-32532), and incorporated herein by reference) (Replaced in the first quarter of fiscal 2016).
|
10.14
|
–
|
Form of Inducement Restricted Stock Award Agreement, between William A. Wulfsohn and Ashland (filed as Exhibit 4.3 to Ashland’s Form S-8 filed on December 18, 2014 (SEC File No. 333-201053), and incorporated herein by reference).
|
10.15
|
–
|
Form of Chief Executive Officer Change in Control Agreement (filed as Exhibit 10.3 to Ashland’s Form 10-Q for the quarter ended December 31, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.16
|
–
|
Form of Chief Executive Officer Change in Control Agreement (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on October 9, 2015 (SEC File No. 001-32532), and incorporated herein by reference) (Replaced in the first quarter of fiscal 2016).
|
10.17
|
–
|
Form of Executive Officer Change in Control Agreement (filed as Exhibit 10.2 to Ashland’s Form 8-K filed on October 9, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.18
|
–
|
Ashland Inc. Severance Pay Plan (filed as Exhibit 10.1 to Ashland’s Form 10-Q for the quarter ended June 30, 2013 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.19
|
–
|
Form of Indemnification Agreement between Ashland and members of its Board of Directors (filed as Exhibit 10.10 to Ashland’s annual report on Form 10-K for fiscal year ended September 30, 2005 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.20
|
–
|
Amended and Restated Ashland Inc. Incentive Plan (filed as Exhibit 10.17 to Ashland’s Form 10-K for the fiscal year ended September 30, 2009 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.21
|
–
|
2006 Ashland Inc. Incentive Plan (filed as Exhibit 10 to Ashland’s Form 10-Q for the quarter ended December 31, 2005 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.22
|
–
|
Amended and Restated 2011 Ashland Inc. Incentive Plan (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on February 1, 2013 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.23
|
–
|
Amended and Restated 2015 Ashland Inc. Incentive Plan (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on July 20, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.24
|
–
|
Form of Stock Appreciation Rights Award Agreement under the Amended and Restated 2011 Ashland Inc. Incentive Plan (filed as Exhibit 10.16 to Ashland’s Form 10-K for the fiscal year ended September 30, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.25
|
–
|
Form of Performance Unit (LTIP) Award Agreement under the Amended and Restated 2011 Ashland Inc. Incentive Plan (filed as Exhibit 10.17 to Ashland’s Form 10-K for the fiscal year ended September 30, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.26
|
–
|
Form of Restricted Stock Award Agreement under the Amended and Restated 2011 Ashland Inc. Incentive Plan (filed as Exhibit 10.18 to Ashland’s Form 10-K for the fiscal year ended September 30, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.27
|
–
|
Form of Restricted Stock Unit Agreement under the Amended and Restated 2011 Ashland Inc. Incentive Plan (filed as Exhibit 10.19 to Ashland’s Form 10-K for the fiscal year ended September 30, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.28
|
–
|
Form of Restricted Stock Award Agreement under the Amended and Restated 2015 Ashland Inc. Incentive Plan (filed as Exhibit 10.5 to Ashland’s Form 10-Q for the quarter ended March 31, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.29
|
–
|
Form of Restricted Stock Unit Award Agreement under the Amended and Restated 2015 Ashland Inc. Incentive Plan (filed as Exhibit 10.6 to Ashland’s Form 10-Q for the quarter ended March 31, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.30
|
–
|
Form of Stock Appreciation Rights Award Agreement under the Amended and Restated 2015 Ashland Inc. Incentive Plan (filed as Exhibit 10.7 to Ashland’s Form 10-Q for the quarter ended March 31, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.31
|
–
|
Form of Performance Unit (LTIP) Award Agreement under the Amended and Restated 2015 Ashland Inc. Incentive Plan (filed as Exhibit 10.8 to Ashland’s Form 10-Q for the quarter ended March 31, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.32
|
–
|
Form of Restricted Stock Award Agreement under the Amended and Restated 2015 Ashland Inc. Incentive Plan (Double-Trigger Form) (filed as Exhibit 10.2 to Ashland’s Form 8-K filed on July 20, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.33
|
–
|
Form of Restricted Stock Unit Award Agreement under the Amended and Restated 2015 Ashland Inc. Incentive Plan (Double-Trigger Form) (filed as Exhibit 10.3 to Ashland’s Form 8-K filed on July 20, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.34
|
–
|
Form of Stock Appreciation Rights Award Agreement under the Amended and Restated 2015 Ashland Inc. Incentive Plan (Double-Trigger Form) (filed as Exhibit 10.4 to Ashland’s Form 8-K filed on July 20, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.35
|
–
|
Form of Performance Unit (LTIP) Award Agreement under the Amended and Restated 2015 Ashland Inc. Incentive Plan (Double-Trigger Form) (filed as Exhibit 10.5 to Ashland’s Form 8-K filed on July 20, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.36
|
–
|
Letter Agreement between Ashland and Luis Fernandez-Moreno dated July 29, 2013 (filed as Exhibit
10.22 to Ashland’s Form 10-K for the fiscal year ended September 30, 2013 (SEC File No. 001- 32532), and incorporated herein by reference).
|
10.37
|
–
|
Letter Agreement between Ashland and Luis Fernandez-Moreno dated November 4, 2013 (filed as Exhibit 10.23 to Ashland’s Form 10-K for the fiscal year ended September 30, 2013 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.38
|
–
|
Letter Agreement between Ashland and Susan B. Esler dated October 28, 2014 (filed as Exhibit 10.25 to Ashland’s Form 10-K for the fiscal year ended September 30, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.39
|
–
|
Letter Agreement between Ashland and William A. Wulfsohn, dated November 12, 2014 (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on November 17, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.40**
|
–
|
Separation Agreement and General Release between Ashland and Susan B. Esler dated October 1, 2015.
|
10.41**
|
–
|
Separation Agreement and General Release between Ashland and Walter H. Solomon dated October 1, 2015.
|
10.42
|
–
|
Form of Performance-Based Restricted Stock Award Agreement (filed as Exhibit 10.3 to Ashland’s Form 8-K filed on October 9, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.43**
|
–
|
Form of Retention Award Agreement for certain Executive Officers.
|
10.44
|
–
|
Stock Purchase Agreement dated as of May 30, 2011, entered into by and among The Samuel J. Heyman 1981 Continuing Trust for Lazarus S. Heyman, The Samuel J. Heyman 1981 Continuing Trust for Eleanor S. Heyman, The Samuel J. Heyman 1981 Continuing Trust for Jennifer L. Heyman, The Samuel J. Heyman 1981 Continuing Trust for Elizabeth D. Heyman, The Lazarus S. Heyman Age 50 Trust for Assets Appointed Under Will of Lazarus S. Heyman, The Eleanor S. Heyman Age 50 Trust for Assets Appointed Under Will of Lazarus S. Heyman, The Jennifer L. Heyman Age 50 Trust for Assets Appointed Under Will of Lazarus S. Heyman, The Elizabeth D. Heyman Age 50 Trust for Assets Appointed Under Will of Lazarus S. Heyman, The Horizon Holdings Residual Trust, RFH Investment Holdings LLC, Ashland and Ronnie F. Heyman, as representative of the Seller Parties (filed as Exhibit 2.1 to Ashland’s Form 8-K filed on May 31, 2011 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.45
|
–
|
Master Formation Agreement dated July 15, 2010, among Ashland, Süd-Chemie Aktiengesellschaft and Ashland-Südchemie-Kernfest GmbH (filed as Exhibit 10.26 to Ashland’s Form 10-K for the fiscal year ended September 30, 2010 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.46
|
–
|
Master Contribution and Sale Agreement dated July 15, 2010, among Ashland, Ashland International Holdings, Inc., Süd-Chemie Aktiengesellschaft, Tecpro Holding Corporation Inc. and Ashland- Südchemie-Kernfest GmbH (filed as Exhibit 10.27 to Ashland’s Form 10-K for the fiscal year ended September 30, 2010 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.47
|
–
|
Shareholders’ Agreement effective November 30, 2010 by and between Süd-Chemie Aktiengesellschaft and Süd-Chemie Finance GmbH and Ashland and Ashland International Holdings, Inc. (filed as Exhibit 10 to Ashland’s Form 10-Q for the quarter ended December 31, 2010 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.48
|
–
|
Credit Agreement dated as of March 14, 2013, among Ashland Inc., as Borrower, The Bank of Nova Scotia, as Administrative Agent, Swing Line Lender and an L/C Issuer, Citibank, N.A., as Syndication Agent, Bank of America, N.A., Deutsche Bank Securities Inc. and PNC Bank, National Association, as Co-Documentation Agents, and the Lenders from time to time party thereto (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on March 15, 2013 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.49
|
–
|
Amendment Agreement, dated as of February 5, 2014, to the Credit Agreement dated as of March 14, 2013, among Ashland Inc., as Borrower, The Bank of Nova Scotia, as Administrative Agent, and each Lender from time to time party thereto and the other agents and arrangers party thereto (filed as Exhibit 10.2 to Ashland’s Form 10-Q for the quarter ended March 31, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.50
|
–
|
Amendment No. 2, dated as of February 27, 2015, to the Credit Agreement, dated as of March 14, 2013, as amended by the Amendment Agreement, dated as of February 5, 2014, among Ashland Inc., as Borrower, The Bank of Nova Scotia, as Administrative Agent, each Lender from time to time party thereto and the other agents and arrangers party thereto (filed as Exhibit 10.3 to Ashland’s Form 10-Q for the quarter ended March 31, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.51
|
–
|
Credit Agreement dated as of June 23, 2015, among Ashland Inc., as Borrower, The Bank of Nova Scotia, as Administrative Agent, Swing Line Lender and an L/C Issuer, Citibank, N.A., as Syndication Agent, Bank of America, N.A., Deutsche Bank Securities Inc. and PNC Bank, National Association, as Co-Documentation Agents, JPMorgan Chase Bank, N.A., Mizuho Bank LTD., U.S. Bank National Association, and Wells Fargo Bank, National Association, as Managing Agents, and the other Lenders party thereto (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on June 23, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.52
|
–
|
Transfer and Administration Agreement, dated as of August 31, 2012, among CVG Capital III LLC, Ashland Inc., Hercules Incorporated, Aqualon Company, ISP Technologies Inc., ISP Synthetic Elastomers LLC, and each other entity from time to time party thereto as an Originator, as Originators, Ashland Inc., as initial Master Servicer, each of Liberty Street Funding LLC, Market Street Funding LLC and Gotham Funding Corporation, as Conduit Investors and Uncommitted Investors, The Bank of Nova Scotia, as the Agent, a Letter of Credit Issuer, a Managing Agent, an Administrator and a Committed Investor, and the Letter of Credit Issuers, Managing Agents, Administrators, Uncommitted Investors and Committed Investors parties thereto from time to time (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on September 7, 2012 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.53
|
–
|
Sale Agreement, dated as of August 31, 2012, among Ashland Inc., Hercules Incorporated, Aqualon Company, ISP Technologies Inc., ISP Synthetic Elastomers LLC and CVG Capital III LLC (filed as Exhibit 10.2 to Ashland’s Form 8-K filed on September 7, 2012 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.54
|
–
|
Parent Undertaking, dated as of August 31, 2012, by Ashland Inc. in favor of The Bank of Nova Scotia and the Secured Parties (filed as Exhibit 10.3 to Ashland’s Form 8-K filed on September 7, 2012 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.55
|
–
|
First Amendment to Transfer and Administration Agreement, dated as of April 30, 2013, among Ashland Inc., CVG Capital III LLC, the Investors, Letter of Credit Issuers, Managing Agents and Administrators party thereto, and the Bank of Nova Scotia, as Agent for the Investors (filed as Exhibit 10.2 to Ashland’s Form 10-Q for the quarter ended June 30, 2013 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.56
|
–
|
Omnibus Amendment to Transfer and Administration Agreement, dated as of August 21, 2013, among Ashland Inc., CVG Capital III LLC, the Originators, the Investors, Letter of Credit Issuers, Managing Agents and Administrators party thereto, and the Bank of Nova Scotia, as Agent for the Investors (filed as Exhibit 10.34 to Ashland’s Form 10-K for the fiscal year ended September 30, 2013 (SEC File
No. 001-32532), and incorporated herein by reference).
|
10.57
|
–
|
Third Amendment to Transfer and Administration Agreement, dated as of October 15, 2013, among Ashland Inc., CVG Capital III LLC, the Originators, the Investors, Letter of Credit Issuers, Managing Agents and Administrators party thereto, and the Bank of Nova Scotia, as Agent for the Investors (filed as Exhibit 10.35 to Ashland’s Form 10-K for the fiscal year ended September 30, 2013 (SEC File
No. 001-32532), and incorporated herein by reference).
|
10.58
|
–
|
Fourth Amendment to Transfer and Administration Agreement, dated as of June 30, 2014, among Ashland Inc., CVG Capital III LLC, the Originators, the Investors, Letter of Credit Issuers, Managing Agents and Administrators party thereto, and the Bank of Nova Scotia, as Agent for the Investors (filed as Exhibit 10.1 to Ashland’s Form 10-Q for the quarter ended June 30, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.59
|
–
|
Receivables Assignment Agreement, dated as of November 25, 2014, among Ashland Inc., as originator and master servicer, CVG Capital III LLC, Ashland Specialty Ingredients G.P., the Investors, Letter of Credit Issuers, Managing Agent and Administrators party thereto, and the Bank of Nova Scotia, as Agent for the Investors (filed as Exhibit 10.4 to Ashland’s Form 10-Q for the quarter ended December 31, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.60
|
–
|
Sixth Amendment to Transfer and Administration Agreement, dated as of November 25, 2014, among Ashland Inc., CVG Capital III LLC, the Originators, the Investors, Letter of Credit Issuers, Managing Agents and Administrators party thereto, and the Bank of Nova Scotia, as Agent for the Investors (filed as Exhibit 10.5 to Ashland’s Form 10-Q for the quarter ended December 31, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.61
|
–
|
Seventh Amendment dated as of August 28, 2015 to the Transfer and Administration Agreement dated as of August 31, 2012, among Ashland Inc., CVG Capital III LLC, the Originators, the Investors, Letter of Credit Issuers, Managing Agents and Administrators party thereto, and The Bank of Nova Scotia, as agent for the Investors (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on September 2, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.62
|
–
|
Eighth Amendment dated as of September 30, 2015 to the Transfer and Administration Agreement as of August 31, 2012, among Ashland Inc., CVG Capital III LLC, the Originators, the Investors, Letter of Credit Issuers, Managing Agents and Administrators party thereto, and The Bank of Nova Scotia, as agent for the Investors (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on October 6, 2015 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.63
|
–
|
First Amendment to Sale Agreement, dated as of June 30, 2014, among Ashland Inc., Hercules Incorporated, Ashland Specialty Ingredients G.P., ISP Technologies Inc., Ashland Elastomers LLC and CVG Capital III LLC (filed as Exhibit 10.2 to Ashland’s Form 10-Q for the quarter ended June 30, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.64
|
–
|
Originator Removal Agreement and Facility Amendment, dated as of July 28, 2014, by and among Ashland, Hercules Incorporated, Ashland Specialty Ingredients G.P., ISP Technologies Inc., Ashland Elastomers LLC, CVG Capital III LLC, the Investors, the Letter of Credit Issuers, Managing Agents and Administrators party thereto, and the Bank of Nova Scotia, as Agent for the Investors (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on August 1, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.65
|
–
|
Master Confirmation - Uncollared Accelerated Share Repurchase, dated August 5, 2014, between Ashland Inc. and Deutsche Bank AG, London Branch (filed as Exhibit 10.1 to Ashland’s Form 8-K filed on August 6, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
10.66
|
–
|
Master Confirmation – Uncollared Accelerated Share Repurchase, dated August 5, 2014, between Ashland Inc. and J.P. Morgan Securities LLC, as agent for JPMorgan Chase Bank, N.A. (filed as Exhibit 10.2 to Ashland’s Form 8-K filed on August 6, 2014 (SEC File No. 001-32532), and incorporated herein by reference).
|
11**
|
–
|
Computation of Earnings Per Share (appearing in Note A of Notes to Consolidated Financial Statements in this annual report on Form 10-K).
|
12**
|
–
|
Computation of Ratio of Earnings to Fixed Charges.
|
21**
|
–
|
List of Subsidiaries.
|
23.1**
|
–
|
Consent of Ernst & Young LLP.
|
23.2**
|
–
|
Consent of PricewaterhouseCoopers LLP.
|
23.3**
|
–
|
Consent of Hamilton, Rabinovitz & Associates, Inc.
|
24**
|
–
|
Power of Attorney.
|
31.1**
|
–
|
Certification of William A. Wulfsohn, Chief Executive Officer of Ashland, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31.2**
|
–
|
Certification of J. Kevin Willis, Chief Financial Officer of Ashland, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32**
|
–
|
Certification of William A. Wulfsohn, Chief Executive Officer of Ashland, and J. Kevin Willis, Chief Financial Officer of Ashland, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS*
|
XBRL Instance Document.
|
101.SCH*
|
XBRL Taxonomy Extension Schema Document.
|
101.CAL*
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
101.DEF*
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101.LAB*
|
XBRL Taxonomy Extension Label Linkbase Document.
|
101.PRE*
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
ASHLAND INC.
|
|
(Registrant)
|
|
By:
|
|
/s/ J. Kevin Willis
|
|
J. Kevin Willis
|
|
Senior Vice President and Chief Financial Officer
|
|
Date: November 20, 2015
|
Signatures
|
|
Capacity
|
/s/ William A. Wulfsohn
|
|
Chairman of the Board, Chief Executive Officer and Director
|
William A. Wulfsohn
|
|
(Principal Executive Officer)
|
/s/ J. Kevin Willis
|
|
Senior Vice President and Chief Financial Officer
|
J. Kevin Willis
|
|
(Principal Financial Officer)
|
/s/ J. William Heitman
|
|
Vice President and Controller
|
J. William Heitman
|
|
(Principal Accounting Officer)
|
|
|
|
*
|
|
Director
|
Brendan M. Cummins
|
|
|
*
|
|
Director
|
Roger W. Hale
|
|
|
*
|
|
Director
|
Stephen F. Kirk
|
|
|
*
|
|
Director
|
Vada O. Manager
|
|
|
*
|
|
Director
|
Barry W. Perry
|
|
|
*
|
|
Director
|
Mark C. Rohr
|
|
|
*
|
|
Director
|
George A. Schaefer, Jr.
|
|
|
*
|
|
Director
|
Janice J. Teal
|
|
|
*
|
|
Director
|
Michael J. Ward
|
|
|
*By:
|
/s/ Peter J. Ganz
|
|
Peter J. Ganz
|
|
Attorney-in-Fact
|
|
|
Date:
|
November 20, 2015
|
Sales by Geography
|
2015
|
|
|
2014
|
|
|
2013
|
|
North America
(a)
|
53
|
%
|
|
53
|
%
|
|
54
|
%
|
Europe
|
24
|
%
|
|
25
|
%
|
|
24
|
%
|
Asia Pacific
|
16
|
%
|
|
15
|
%
|
|
15
|
%
|
Latin America & other
|
7
|
%
|
|
7
|
%
|
|
7
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|
|
(a)
|
Ashland includes only U.S. and Canada in its North American designation.
|
Sales by Reportable Segment
|
2015
|
|
|
2014
|
|
|
2013
|
|
Specialty Ingredients
|
42
|
%
|
|
41
|
%
|
|
41
|
%
|
Performance Materials
|
21
|
%
|
|
26
|
%
|
|
26
|
%
|
Valvoline
|
37
|
%
|
|
33
|
%
|
|
33
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|
|
•
|
In 2014, completed a prepaid variable share repurchase agreement for
$80 million
and received
0.8 million
shares.
|
•
|
In 2014, entered into
$750 million
of accelerated share repurchase agreements that were completed during 2015 and received
6.4 million
shares, of which
0.5 million
shares were received during 2015.
|
•
|
In 2014, entered into
$250 million
of share repurchase agreements that were completed during 2015 and received
2.4 million
shares, of which
1.2 million
were repurchased during 2015.
|
•
|
In 2015, entered into
$270 million
of accelerated share repurchase agreements that were completed during 2015 and received
2.2 million
shares.
|
•
|
Ashland’s net income amounted to
$309 million
in
2015
,
$233 million
in
2014
and
$683 million
in
2013
, or
$4.48
,
$3.00
and
$8.57
diluted earnings per share, respectively.
|
•
|
Discontinued operations, which are reported net of taxes, resulted in income of
$118 million
,
$161 million
and
$130 million
during
2015
,
2014
and
2013
, respectively.
|
•
|
Income from continuing operations, which excludes results from discontinued operations, amounted to
$191 million
in
2015
,
$72 million
in
2014
and
$553 million
in
2013
, or
$2.78
,
$0.93
and
$6.95
diluted earnings per share, respectively.
|
•
|
The effective income tax benefit rate of
13%
for
2015
, income tax benefit rate of
162%
for
2014
, and the income tax expense rate of
26%
for
2013
, were significantly affected by a number of discrete items.
|
•
|
Ashland incurred pretax net interest and other financing expense of
$174 million
,
$166 million
and
$282 million
during
2015
,
2014
and
2013
, respectively. Certain charges associated with debt refinancing activity impacted 2015 and 2013.
|
•
|
Operating income was
$458 million
,
$46 million
and
$1,039 million
during
2015
,
2014
and
2013
, respectively.
|
•
|
Expense of
$255 million
and
$438 million
in
2015
and
2014
, respectively, and income of
$417 million
in
2013
from the immediate recognition from the change in the fair value of the plan assets and net actuarial gains and losses for defined benefit pension plans and other postretirement benefit plans;
|
•
|
Restructuring and integration costs include the following:
|
◦
|
$27 million of restructuring costs (including $6 million of accelerated depreciation and $17 million related to the restructuring plan within an existing manufacturing facility) during 2015;
|
◦
|
$147 million of restructuring and integration costs (including $17 million of accelerated depreciation and $19 million in asset impairment charges related to a foreign operation) during 2014; and
|
◦
|
$29 million
of restructuring and other integration costs during 2013;
|
•
|
a
$14 million
impairment related to the Valvoline joint venture equity investment within Venezuela during 2015 and a
$50 million
impairment charge related to the ASK joint venture equity investment during 2014;
|
•
|
$12 million
,
$13 million
and
$16 million
net environmental charges during 2015, 2014 and 2013, respectively;
|
•
|
$11 million
,
$13 million
and
$41 million
impairment charges related to certain in-process research and development (IPR&D) assets associated with the acquisition of International Specialty Products Inc. (ISP) in 2011 during 2015, 2014 and 2013, respectively;
|
•
|
$16 million
of tax indemnity income, a $13 million charge related to a customer claim, and a
$7 million
charge for a stock incentive plan award modification, each during 2015;
|
•
|
two
$5 million
charges for a foreign tax indemnification receivable adjustment and a legal reserve, respectively, during 2014; and
|
•
|
$22 million
and
$13 million
gains resulting from Ashland's settlement of an insurance claim and settlement of a customer claim, respectively, during 2013.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Net income
|
$
|
309
|
|
|
$
|
233
|
|
|
$
|
683
|
|
Income tax expense (benefit)
|
(22
|
)
|
|
(188
|
)
|
|
196
|
|
|||
Net interest and other financing expense
|
174
|
|
|
166
|
|
|
282
|
|
|||
Depreciation and amortization
(a)
|
335
|
|
|
357
|
|
|
354
|
|
|||
EBITDA
|
796
|
|
|
568
|
|
|
1,515
|
|
|||
Income from discontinued operations (net of taxes)
|
(118
|
)
|
|
(161
|
)
|
|
(130
|
)
|
|||
Losses (gain) on pension and other postretirement plan remeasurement
(b)
|
255
|
|
|
438
|
|
|
(417
|
)
|
|||
Net loss on divestitures
|
118
|
|
|
—
|
|
|
14
|
|
|||
Restructuring and other integration costs
|
21
|
|
|
111
|
|
|
29
|
|
|||
Tax indemnity income
|
(16
|
)
|
|
—
|
|
|
—
|
|
|||
Impairment of equity investments
|
14
|
|
|
50
|
|
|
—
|
|
|||
Environmental reserve adjustments
|
12
|
|
|
13
|
|
|
16
|
|
|||
Customer claim
|
13
|
|
|
—
|
|
|
—
|
|
|||
Stock incentive award modification
|
7
|
|
|
—
|
|
|
—
|
|
|||
Asset impairment and accelerated depreciation
|
6
|
|
|
36
|
|
|
2
|
|
|||
Impairment of IPR&D assets
|
11
|
|
|
13
|
|
|
41
|
|
|||
Foreign tax indemnification receivable adjustment
|
—
|
|
|
5
|
|
|
—
|
|
|||
Legal reserve charge
|
—
|
|
|
5
|
|
|
—
|
|
|||
Insurance settlement
|
—
|
|
|
—
|
|
|
(22
|
)
|
|||
Settled claim
|
—
|
|
|
—
|
|
|
(13
|
)
|
|||
Other
|
—
|
|
|
—
|
|
|
2
|
|
|||
Adjusted EBITDA
|
$
|
1,119
|
|
|
$
|
1,078
|
|
|
$
|
1,037
|
|
|
|
|
|
|
|
(a)
|
Excludes
$6 million
,
$36 million
and
$2 million
of asset impairment charges and accelerated depreciation during
2015
,
2014
and
2013
, respectively.
|
(b)
|
For supplemental information on the components of this adjustment, see page M-30 within the MD&A - Critical Accounting Policies - Employee benefit obligations.
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
change
|
|
|
change
|
|
|||||
Sales
|
$
|
5,387
|
|
|
$
|
6,121
|
|
|
$
|
6,091
|
|
|
$
|
(734
|
)
|
|
$
|
30
|
|
(In millions)
|
2015 change
|
|
|
2014 change
|
|
||
Pricing
|
$
|
(166
|
)
|
|
$
|
(88
|
)
|
Volume and product mix
|
(19
|
)
|
|
110
|
|
||
Currency exchange
|
(266
|
)
|
|
8
|
|
||
Divestitures
|
(283
|
)
|
|
—
|
|
||
Change in sales
|
$
|
(734
|
)
|
|
$
|
30
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
change
|
|
|
change
|
|
|||||
Cost of sales
|
$
|
3,814
|
|
|
$
|
4,605
|
|
|
$
|
4,304
|
|
|
$
|
(791
|
)
|
|
$
|
301
|
|
Gross profit as a percent of sales
|
29.2
|
%
|
|
24.8
|
%
|
|
29.3
|
%
|
|
|
|
|
|
|
(In millions)
|
2015 change
|
|
|
2014 change
|
|
||
Production costs
|
$
|
(279
|
)
|
|
$
|
(70
|
)
|
Divestitures
|
(245
|
)
|
|
—
|
|
||
Currency exchange
|
(181
|
)
|
|
4
|
|
||
Volume and product mix
|
(30
|
)
|
|
80
|
|
||
Pension and other postretirement benefit plans expense (income) (including remeasurements)
|
(43
|
)
|
|
269
|
|
||
Asset impairment and accelerated depreciation
|
(30
|
)
|
|
34
|
|
||
Inventory/customer claim charges
|
13
|
|
|
(51
|
)
|
||
Severance and other costs
|
4
|
|
|
13
|
|
||
Insurance claim settlement
|
—
|
|
|
22
|
|
||
Change in cost of sales
|
$
|
(791
|
)
|
|
$
|
301
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
change
|
|
|
change
|
|
|||||
Selling, general and administrative expense
|
$
|
1,028
|
|
|
$
|
1,358
|
|
|
$
|
670
|
|
|
$
|
(330
|
)
|
|
$
|
688
|
|
As a percent of sales
|
19.1
|
%
|
|
22.2
|
%
|
|
11.0
|
%
|
|
|
|
|
|
|
•
|
a $146 million decrease in expense compared to the prior year due to fluctuations in adjustments from the gains and losses for pension and postretirement benefit plans (costs of $155 million in 2015 and $301 million in 2014). As previously discussed within the cost of sales analysis, the 2015 remeasurement loss was driven primarily by a lower than expected return on pension plan assets (see "Critical Accounting Policies" for additional details);
|
•
|
Approximately $100 million of current year cost savings related to the 2014 global restructuring compared to approximately $40 million of cost savings in the prior year;
|
•
|
$98 million key item expense during 2014 for severance and other restructuring costs associated with the 2014 global restructuring;
|
•
|
Environmental reserve expense adjustments of $32 million and $29 million during 2015 and 2014, respectively;
|
•
|
Favorable foreign currency exchange of $36 million during 2015;
|
•
|
Increased employee related costs of approximately $22 million during 2015;
|
•
|
$21 million decrease in expense for certain divestitures, primarily the Elastomers division during 2015; and
|
•
|
Tax indemnification income of $16 million and a stock incentive award modification resulting in expense of $7 million during 2015.
|
•
|
a $590 million increase in expense compared to the prior year due to fluctuations in adjustments from the gains and losses for pension and postretirement benefit plans (cost of $301 million in 2014 and income of $289 million in 2013). As previously discussed within the cost of sales analysis, the 2014 remeasurement loss was driven primarily by lower discount rates and a change in mortality tables (see "Critical Accounting Policies" for additional details);
|
•
|
Certain key item expense in 2014 and 2013 of $98 million and $29 million, respectively, for severance, restructuring and integration charges;
|
•
|
Increased incentive compensation of approximately $50 million during 2014;
|
•
|
Approximately $40 million in cost savings during 2014 resulting from the 2014 global restructuring program; and
|
•
|
Environmental reserve expense adjustments of $29 million and $22 million during 2014 and 2013, respectively.
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
change
|
|
|
change
|
|
|||||
Research and development expense
|
$
|
110
|
|
|
$
|
114
|
|
|
$
|
142
|
|
|
$
|
(4
|
)
|
|
$
|
(28
|
)
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
change
|
|
|
change
|
|
|||||
Equity and other income (loss)
|
|
|
|
|
|
|
|
|
|
||||||||||
Equity income (loss)
|
$
|
1
|
|
|
$
|
(25
|
)
|
|
$
|
26
|
|
|
$
|
26
|
|
|
$
|
(51
|
)
|
Other income
|
22
|
|
|
27
|
|
|
38
|
|
|
(5
|
)
|
|
(11
|
)
|
|||||
|
$
|
23
|
|
|
$
|
2
|
|
|
$
|
64
|
|
|
$
|
21
|
|
|
$
|
(62
|
)
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
change
|
|
|
change
|
|
|||||
Net interest and other financing expense (income)
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
$
|
166
|
|
|
$
|
163
|
|
|
$
|
273
|
|
|
$
|
3
|
|
|
$
|
(110
|
)
|
Interest income
|
(6
|
)
|
|
(6
|
)
|
|
(4
|
)
|
|
—
|
|
|
(2
|
)
|
|||||
Available-for-sale securities income
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|||||
Other financing costs
|
17
|
|
|
9
|
|
|
13
|
|
|
8
|
|
|
(4
|
)
|
|||||
|
$
|
174
|
|
|
$
|
166
|
|
|
$
|
282
|
|
|
$
|
8
|
|
|
$
|
(116
|
)
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
change
|
|
|
change
|
|
|||||
Net gain (loss) on divestitures
|
|
|
|
|
|
|
|
|
|
||||||||||
Elastomers
|
$
|
(86
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(86
|
)
|
|
$
|
—
|
|
Valvoline car care products
|
(26
|
)
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
—
|
|
|||||
MAP Transaction adjustments
|
(6
|
)
|
|
4
|
|
|
(8
|
)
|
|
(10
|
)
|
|
12
|
|
|||||
PVAc divestiture
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
(1
|
)
|
|||||
Other
|
3
|
|
|
—
|
|
|
(1
|
)
|
|
3
|
|
|
1
|
|
|||||
|
$
|
(115
|
)
|
|
$
|
4
|
|
|
$
|
(8
|
)
|
|
$
|
(119
|
)
|
|
$
|
12
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
change
|
|
|
change
|
|
|||||
Income tax expense (benefit)
|
$
|
(22
|
)
|
|
$
|
(188
|
)
|
|
$
|
196
|
|
|
$
|
166
|
|
|
$
|
(384
|
)
|
Effective tax rate
|
(13
|
)%
|
|
(162
|
)%
|
|
26
|
%
|
|
|
|
|
|
|
|||||
Effective tax rate (excluding key items)
|
23
|
%
|
|
20
|
%
|
|
22
|
%
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
change
|
|
|
change
|
|
|||||
Income (loss) from discontinued operations
|
|
|
|
|
|
|
|
|
|
||||||||||
(net of taxes)
|
|
|
|
|
|
|
|
|
|
||||||||||
Asbestos-related litigation matters
|
$
|
110
|
|
|
$
|
6
|
|
|
$
|
2
|
|
|
$
|
104
|
|
|
$
|
4
|
|
Water Technologies
|
6
|
|
|
151
|
|
|
124
|
|
|
(145
|
)
|
|
27
|
|
|||||
Distribution
|
1
|
|
|
—
|
|
|
(6
|
)
|
|
1
|
|
|
6
|
|
|||||
APAC
|
1
|
|
|
4
|
|
|
10
|
|
|
(3
|
)
|
|
(6
|
)
|
|||||
|
$
|
118
|
|
|
$
|
161
|
|
|
$
|
130
|
|
|
$
|
(43
|
)
|
|
$
|
31
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
change
|
|
|
change
|
|
|||||
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
||||||||||
(net of taxes)
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized translation gain (loss)
|
$
|
(369
|
)
|
|
$
|
(160
|
)
|
|
$
|
37
|
|
|
$
|
(209
|
)
|
|
$
|
(197
|
)
|
Pension and postretirement obligation adjustment
|
(18
|
)
|
|
(21
|
)
|
|
(5
|
)
|
|
3
|
|
|
(16
|
)
|
|||||
Unrealized loss on available-for-sale securities
|
(11
|
)
|
|
—
|
|
|
—
|
|
|
(11
|
)
|
|
—
|
|
|||||
Net change in interest rate hedges
|
—
|
|
|
—
|
|
|
38
|
|
|
—
|
|
|
(38
|
)
|
|||||
|
$
|
(398
|
)
|
|
$
|
(181
|
)
|
|
$
|
70
|
|
|
$
|
(217
|
)
|
|
$
|
(251
|
)
|
•
|
In
2015
, other comprehensive loss, net of tax, from foreign currency translation adjustments was
$369 million
, compared to
$160 million
in
2014
, mainly as a result of the strengthening of the U.S. Dollar against other global currencies, including the Euro and Australian dollar. The fluctuations in unrealized translation losses are primarily due to translating foreign subsidiary financial statements from local currencies to U.S. Dollars.
|
•
|
Pension and postretirement obligation adjustment was $18 million and $21 million in 2015 and 2014, respectively. Of these amounts,
$17 million
and
$25 million
during 2015 and 2014, respectively, of unrecognized prior service credits, net of tax, related to pension and other postretirement benefit plans were amortized and reclassified into net income, while cost of
$1 million
and credit of
$4 million
, respectively, of additional unrecognized prior service, net of tax, was included in other comprehensive loss.
|
•
|
$11 million
of unrealized loss on available-for-sale securities, net of tax, related to the restricted investments, was recognized within other comprehensive loss during 2015.
|
•
|
In
2014
, other comprehensive loss, net of tax, from foreign currency translation adjustments was
$160 million
, of which $166 million was recognized within other comprehensive income during 2014, compared to a gain of
$37 million
in
2013
. The fluctuations in unrealized translation are primarily due to translating foreign subsidiary financial statements from local currencies to U.S. Dollars. The change in this caption is a result of the U.S. dollar strengthening against the Euro during the last quarter of 2014. Additionally, as a result of the sale of Water Technologies during 2014,
$6 million
of translation losses were reclassified into net income.
|
•
|
Pension and postretirement obligation adjustment was $21 million and $5 million in 2014 and 2013, respectively. Of these amounts,
$25 million
and
$15 million
during 2014 and 2013, respectively, of unrecognized prior service credits, net of tax, related to pension and other postretirement benefit plans were amortized and reclassified into net income, while
$4 million
and
$10 million
, respectively, of additional unrecognized prior service credit, net of tax, was included in other comprehensive income (loss).
|
•
|
During 2013,
$38 million
of a net change related to interest rate hedges was recognized. Of this amount,
$41 million
, net of tax, was reclassified into net income for losses related to the interest rate hedges terminated during the year, while
$3 million
of an unrealized loss was recorded prior to the termination.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Sales
|
|
|
|
|
|
||||||
Specialty Ingredients
|
$
|
2,263
|
|
|
$
|
2,498
|
|
|
$
|
2,478
|
|
Performance Materials
|
1,157
|
|
|
1,582
|
|
|
1,617
|
|
|||
Valvoline
|
1,967
|
|
|
2,041
|
|
|
1,996
|
|
|||
|
$
|
5,387
|
|
|
$
|
6,121
|
|
|
$
|
6,091
|
|
Operating income (loss)
|
|
|
|
|
|
|
|
|
|||
Specialty Ingredients
|
$
|
239
|
|
|
$
|
253
|
|
|
$
|
243
|
|
Performance Materials
|
87
|
|
|
7
|
|
|
106
|
|
|||
Valvoline
|
359
|
|
|
323
|
|
|
295
|
|
|||
Unallocated and other
|
(227
|
)
|
|
(537
|
)
|
|
395
|
|
|||
|
$
|
458
|
|
|
$
|
46
|
|
|
$
|
1,039
|
|
Depreciation and amortization
|
|
|
|
|
|
|
|
|
|||
Specialty Ingredients
|
$
|
244
|
|
|
$
|
262
|
|
|
$
|
242
|
|
Performance Materials
|
59
|
|
|
91
|
|
|
75
|
|
|||
Valvoline
|
38
|
|
|
37
|
|
|
35
|
|
|||
Unallocated and other
|
—
|
|
|
3
|
|
|
4
|
|
|||
|
$
|
341
|
|
|
$
|
393
|
|
|
$
|
356
|
|
Operating information
|
|
|
|
|
|
|
|
|
|||
Specialty Ingredients
(a)
|
|
|
|
|
|
|
|
|
|||
Sales per shipping day
|
$
|
8.9
|
|
|
$
|
9.9
|
|
|
$
|
9.8
|
|
Metric tons sold (thousands)
|
324.3
|
|
|
355.2
|
|
|
336.1
|
|
|||
Gross profit as a percent of sales
|
32.4
|
%
|
|
31.2
|
%
|
|
30.8
|
%
|
|||
Performance Materials
(a)
|
|
|
|
|
|
|
|
|
|||
Sales per shipping day
|
$
|
4.6
|
|
|
$
|
6.3
|
|
|
$
|
6.4
|
|
Metric tons sold (thousands)
|
476.6
|
|
|
591.1
|
|
|
582.8
|
|
|||
Gross profit as a percent of sales
|
18.8
|
%
|
|
13.1
|
%
|
|
14.9
|
%
|
|||
Valvoline
(a)
|
|
|
|
|
|
|
|
|
|||
Lubricant sales gallons
|
167.4
|
|
|
162.6
|
|
|
158.4
|
|
|||
Premium lubricants (percent of U.S. branded volumes)
|
40.2
|
%
|
|
37.1
|
%
|
|
33.6
|
%
|
|||
Gross profit as a percent of sales
|
35.6
|
%
|
|
31.8
|
%
|
|
31.6
|
%
|
|||
|
|
|
|
|
|
(a)
|
Sales are defined as sales and operating revenues. Gross profit is defined as sales, less cost of sales.
|
|
2015
|
|||||||
Sales by Geography
|
Specialty Ingredients
|
|
Performance Materials
|
|
Valvoline
|
|||
North America
|
39
|
%
|
|
43
|
%
|
|
73
|
%
|
Europe
|
32
|
%
|
|
37
|
%
|
|
8
|
%
|
Asia Pacific
|
19
|
%
|
|
14
|
%
|
|
14
|
%
|
Latin America & other
|
10
|
%
|
|
6
|
%
|
|
5
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
2014
|
|||||||
Sales by Geography
|
Specialty Ingredients
|
|
Performance Materials
|
|
Valvoline
|
|||
North America
|
39
|
%
|
|
48
|
%
|
|
72
|
%
|
Europe
|
33
|
%
|
|
33
|
%
|
|
9
|
%
|
Asia Pacific
|
18
|
%
|
|
14
|
%
|
|
14
|
%
|
Latin America & other
|
10
|
%
|
|
5
|
%
|
|
5
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
2013
|
|||||||
Sales by Geography
|
Specialty Ingredients
|
|
Performance Materials
|
|
Valvoline
|
|||
North America
|
42
|
%
|
|
48
|
%
|
|
73
|
%
|
Europe
|
31
|
%
|
|
34
|
%
|
|
9
|
%
|
Asia Pacific
|
17
|
%
|
|
12
|
%
|
|
14
|
%
|
Latin America & other
|
10
|
%
|
|
6
|
%
|
|
4
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
September 30
|
||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Operating income
|
$
|
239
|
|
|
$
|
253
|
|
|
$
|
243
|
|
Depreciation and amortization (a)
|
238
|
|
|
243
|
|
|
242
|
|
|||
EBITDA
|
477
|
|
|
496
|
|
|
485
|
|
|||
Severance and other costs
|
17
|
|
|
—
|
|
|
—
|
|
|||
Impairment of IPR&D assets
|
11
|
|
|
13
|
|
|
41
|
|
|||
Customer claim
|
13
|
|
|
—
|
|
|
—
|
|
|||
Accelerated depreciation and asset impairment
|
6
|
|
|
19
|
|
|
—
|
|
|||
Environmental reserve adjustment
|
3
|
|
|
1
|
|
|
—
|
|
|||
Insurance settlement
|
—
|
|
|
—
|
|
|
(22
|
)
|
|||
Settled claim
|
—
|
|
|
—
|
|
|
(13
|
)
|
|||
Adjusted EBITDA
|
$
|
527
|
|
|
$
|
529
|
|
|
$
|
491
|
|
|
|
|
|
|
|
(a)
|
Excludes
$6 million
and $19 million of accelerated depreciation and asset impairment charges during
2015
and 2014, respectively.
|
|
September 30
|
||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Operating income
|
$
|
87
|
|
|
$
|
7
|
|
|
$
|
106
|
|
Depreciation and amortization
(a)
|
59
|
|
|
74
|
|
|
73
|
|
|||
EBITDA
|
146
|
|
|
81
|
|
|
179
|
|
|||
Impairment of equity investment
|
—
|
|
|
50
|
|
|
—
|
|
|||
Severance
|
—
|
|
|
13
|
|
|
—
|
|
|||
Legal reserve charge
|
—
|
|
|
5
|
|
|
—
|
|
|||
Accelerated depreciation
|
—
|
|
|
17
|
|
|
2
|
|
|||
Adjusted EBITDA
|
$
|
146
|
|
|
$
|
166
|
|
|
$
|
181
|
|
|
|
|
|
|
|
(a)
|
Excludes
$17 million
and
$2 million
of accelerated depreciation during
2014
and
2013
, respectively.
|
|
September 30
|
||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Operating income
|
$
|
359
|
|
|
$
|
323
|
|
|
$
|
295
|
|
Depreciation and amortization
|
38
|
|
|
37
|
|
|
35
|
|
|||
EBITDA
|
397
|
|
|
360
|
|
|
330
|
|
|||
Impairment of equity investment
|
14
|
|
|
—
|
|
|
—
|
|
|||
Adjusted EBITDA
|
$
|
411
|
|
|
$
|
360
|
|
|
$
|
330
|
|
|
September 30
|
||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Gain (losses) on pension and other postretirement plan remeasurement
|
$
|
(255
|
)
|
|
$
|
(438
|
)
|
|
$
|
417
|
|
Pension and other postretirement net periodic income
(a)
|
54
|
|
|
54
|
|
|
68
|
|
|||
Restructuring activities (includes stranded costs from Water Technologies)
|
(8
|
)
|
|
(129
|
)
|
|
(64
|
)
|
|||
Environmental reserves for divested businesses
|
(29
|
)
|
|
(28
|
)
|
|
(22
|
)
|
|||
Tax indemnity income
|
16
|
|
|
—
|
|
|
—
|
|
|||
Other income (expense)
|
(5
|
)
|
|
4
|
|
|
(4
|
)
|
|||
Total unallocated income (expense)
|
$
|
(227
|
)
|
|
$
|
(537
|
)
|
|
$
|
395
|
|
|
|
|
|
|
|
(a)
|
Amounts exclude service costs of $27 million during
2015
and $30 million during each of
2014
and
2013
which are allocated to Ashland’s reportable segments.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Cash provided (used) by:
|
|
|
|
|
|
||||||
Operating activities from continuing operations
|
$
|
89
|
|
|
$
|
580
|
|
|
$
|
653
|
|
Investing activities from continuing operations
|
(417
|
)
|
|
(168
|
)
|
|
(272
|
)
|
|||
Financing activities from continuing operations
|
(30
|
)
|
|
(1,034
|
)
|
|
(592
|
)
|
|||
Discontinued operations
|
269
|
|
|
1,671
|
|
|
32
|
|
|||
Effect of currency exchange rate changes on cash and cash equivalents
|
(47
|
)
|
|
(2
|
)
|
|
2
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
$
|
(136
|
)
|
|
$
|
1,047
|
|
|
$
|
(177
|
)
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Cash flows provided (used) by operating activities from continuing operations
|
|
|
|
|
|
||||||
Net income
|
$
|
309
|
|
|
$
|
233
|
|
|
$
|
683
|
|
Income from discontinued operations (net of taxes)
|
(118
|
)
|
|
(161
|
)
|
|
(130
|
)
|
|||
Adjustments to reconcile income from continuing operations
|
|
|
|
|
|
|
|
|
|||
to cash flows from operating activities
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
341
|
|
|
393
|
|
|
356
|
|
|||
Debt issuance cost amortization
|
18
|
|
|
14
|
|
|
65
|
|
|||
Deferred income taxes
|
(57
|
)
|
|
(294
|
)
|
|
153
|
|
|||
Equity income from affiliates
|
(15
|
)
|
|
(25
|
)
|
|
(26
|
)
|
|||
Distributions from equity affiliates
|
22
|
|
|
14
|
|
|
11
|
|
|||
Stock based compensation expense - Note P
|
30
|
|
|
34
|
|
|
30
|
|
|||
Loss on early retirement of debt
|
9
|
|
|
—
|
|
|
—
|
|
|||
Gain on available-for-sale securities
|
(3
|
)
|
|
—
|
|
|
—
|
|
|||
Net loss (gain) on divestitures - Note B
|
115
|
|
|
(4
|
)
|
|
8
|
|
|||
Impairments of equity investments and in-process research and
|
|
|
|
|
|
||||||
development
|
25
|
|
|
63
|
|
|
41
|
|
|||
Pension contributions
|
(610
|
)
|
|
(38
|
)
|
|
(124
|
)
|
|||
Losses (gain) on pension and postretirement plan remeasurement
|
255
|
|
|
438
|
|
|
(417
|
)
|
|||
Change in operating assets and liabilities
(a)
|
(232
|
)
|
|
(87
|
)
|
|
3
|
|
|||
Total cash flows provided by operating activities from continuing operations
|
$
|
89
|
|
|
$
|
580
|
|
|
$
|
653
|
|
|
|
|
|
|
|
(a)
|
Excludes changes resulting from operations acquired or sold.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Changes in assets and liabilities
(a)
|
|
|
|
|
|
|
|
|
|||
Accounts receivable
|
$
|
261
|
|
|
$
|
(16
|
)
|
|
$
|
43
|
|
Inventories
|
39
|
|
|
(4
|
)
|
|
106
|
|
|||
Trade and other payables
|
(229
|
)
|
|
64
|
|
|
(7
|
)
|
|||
Other assets and liabilities
|
(303
|
)
|
|
(131
|
)
|
|
(139
|
)
|
|||
Change in operating assets and liabilities
|
$
|
(232
|
)
|
|
$
|
(87
|
)
|
|
$
|
3
|
|
|
|
|
|
|
|
(a)
|
Excludes changes resulting from operations acquired or sold.
|
•
|
Accounts receivable - Changes in accounts receivable resulted in a
$261 million
inflow of cash in
2015
compared to
$16 million
of cash outflows in
2014
and
$43 million
of cash inflows in
2013
. The larger use of cash during 2014 was due to increased sales compared to 2015 and 2013.
|
•
|
Inventory - Changes in inventory resulted in cash inflows of
$39 million
in
2015
compared to cash outflows of
$4 million
in
2014
and cash inflows of
$106 million
in
2013
. During 2013, there were decreased inventory levels, primarily within the Specialty Ingredients reportable segment, resulting from lower value guar-based product sold during the year.
|
•
|
Trade and other payables - Changes in trade and other payables resulted in cash outflows of
$229 million
in
2015
compared to cash inflows of
$64 million
in
2014
and cash outflows of
$7 million
in
2013
. During 2014, there were increased accruals for incentive compensation and severance related to the 2014 global restructuring which resulted in large cash outflows in 2015. Approximately $60 million of incentive compensation payments and $45 million of severance payments related to restructuring activities were made during 2015 compared to 2014 which had approximately $15 million of incentive compensation payments and $52 million of severance payments.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Cash flows provided (used) by investing activities from continuing operations
|
|
|
|
|
|
||||||
Additions to property, plant and equipment
|
$
|
(265
|
)
|
|
$
|
(248
|
)
|
|
$
|
(264
|
)
|
Proceeds from disposal of property, plant and equipment
|
3
|
|
|
3
|
|
|
5
|
|
|||
Purchase of operations - net of cash acquired
|
(13
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds (uses) from sale of operations or equity investments
|
161
|
|
|
92
|
|
|
(13
|
)
|
|||
Proceeds from sales of available-for-sale securities
|
315
|
|
|
—
|
|
|
—
|
|
|||
Purchase of available-for-sale securities
|
(315
|
)
|
|
—
|
|
|
—
|
|
|||
Funds restricted for specific transactions
|
(320
|
)
|
|
(15
|
)
|
|
—
|
|
|||
Reimbursements from restricted investments
|
6
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from the settlement of derivative instruments
|
18
|
|
|
—
|
|
|
—
|
|
|||
Payments from the settlement of derivative instruments
|
(7
|
)
|
|
—
|
|
|
—
|
|
|||
Total cash flows used by investing activities from continuing operations
|
$
|
(417
|
)
|
|
$
|
(168
|
)
|
|
$
|
(272
|
)
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Cash flows provided (used) by financing activities from continuing operations
|
|
|
|
|
|
||||||
Proceeds from issuance of long-term debt
|
$
|
1,100
|
|
|
$
|
—
|
|
|
$
|
2,320
|
|
Repayment of long-term debt
|
(623
|
)
|
|
(11
|
)
|
|
(2,613
|
)
|
|||
Premium on long-term debt repayment
|
(9
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds (repayment) from short-term debt
|
(3
|
)
|
|
22
|
|
|
(36
|
)
|
|||
Repurchase of common stock
|
(397
|
)
|
|
(954
|
)
|
|
(150
|
)
|
|||
Debt issuance costs
|
(9
|
)
|
|
—
|
|
|
(38
|
)
|
|||
Cash dividends paid
|
(98
|
)
|
|
(103
|
)
|
|
(88
|
)
|
|||
Excess tax benefits related to share-based payments
|
9
|
|
|
12
|
|
|
13
|
|
|||
Total cash flows used by financing activities from continuing operations
|
$
|
(30
|
)
|
|
$
|
(1,034
|
)
|
|
$
|
(592
|
)
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Cash provided (used) by discontinued operations
|
|
|
|
|
|
||||||
Operating cash flows
|
$
|
245
|
|
|
$
|
63
|
|
|
$
|
80
|
|
Investing cash flows
|
24
|
|
|
1,608
|
|
|
(48
|
)
|
|||
Total cash flows provided by discontinued operations
|
$
|
269
|
|
|
$
|
1,671
|
|
|
$
|
32
|
|
|
September 30
|
||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Cash flows provided by operating activities from continuing operations
|
$
|
89
|
|
|
$
|
580
|
|
|
$
|
653
|
|
Less:
|
|
|
|
|
|
|
|
|
|||
Additions to property, plant and equipment
|
(265
|
)
|
|
(248
|
)
|
|
(264
|
)
|
|||
Discretionary contribution to pension plans
|
500
|
|
|
—
|
|
|
—
|
|
|||
Payment resulting from termination of interest rate swaps
(a)
|
—
|
|
|
—
|
|
|
52
|
|
|||
Free cash flows
|
$
|
324
|
|
|
$
|
332
|
|
|
$
|
441
|
|
|
|
|
|
|
|
(a)
|
Since payment was generated from financing activity, this amount has been included within this calculation.
|
|
September 30
|
||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Cash and cash equivalents
|
$
|
1,257
|
|
|
$
|
1,393
|
|
|
$
|
346
|
|
|
|
|
|
|
|
||||||
Unused borrowing capacity
|
|
|
|
|
|
|
|
|
|||
Revolving credit facility
|
$
|
1,013
|
|
|
$
|
1,084
|
|
|
$
|
1,119
|
|
Accounts receivable securitization facility
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
80
|
|
|
September 30
|
||||||
(In millions)
|
2015
|
|
|
2014
|
|
||
Short-term debt
|
$
|
326
|
|
|
$
|
329
|
|
Long-term debt (including current portion and debt issuance cost discounts)
(a)
|
3,403
|
|
|
2,920
|
|
||
Total debt
|
$
|
3,729
|
|
|
$
|
3,249
|
|
|
|
|
|
(a)
|
Includes
$28 million
and
$31 million
of debt issuance cost discounts as of
September 30, 2015
and
2014
, respectively.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Specialty Ingredients
|
$
|
171
|
|
|
$
|
159
|
|
|
$
|
144
|
|
Performance Materials
|
33
|
|
|
38
|
|
|
43
|
|
|||
Valvoline
|
45
|
|
|
36
|
|
|
41
|
|
|||
Unallocated and other
|
16
|
|
|
15
|
|
|
36
|
|
|||
Total capital expenditures
|
$
|
265
|
|
|
$
|
248
|
|
|
$
|
264
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Capital employed
(a)
|
|
|
|
|
|
||||||
Specialty Ingredients
|
$
|
5,043
|
|
|
$
|
5,413
|
|
|
$
|
5,646
|
|
Performance Materials
(b)
|
870
|
|
|
1,121
|
|
|
1,280
|
|
|||
Valvoline
|
653
|
|
|
746
|
|
|
702
|
|
|||
|
|
|
|
|
|
(a)
|
Excludes the assets and liabilities classified within unallocated and other which primarily includes debt and other long-term liabilities such as asbestos and pension. The net liability in unallocated and other was
$3,529 million
,
$3,697 million
and
$3,075 million
as of
September 30, 2015
,
2014
and
2013
, respectively.
|
(b)
|
Decline primarily due to sale of Elastomers during 2015.
|
|
|
|
Less than
|
|
|
1-3
|
|
|
3-5
|
|
|
More than
|
|
||||||
(In millions)
|
Total
|
|
|
1 year
|
|
|
years
|
|
|
years
|
|
|
5 years
|
|
|||||
Contractual obligations
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Raw material and service contract purchase obligations
(a)
|
$
|
651
|
|
|
$
|
176
|
|
|
$
|
244
|
|
|
$
|
119
|
|
|
$
|
112
|
|
Employee benefit obligations
(b)
|
334
|
|
|
49
|
|
|
67
|
|
|
65
|
|
|
153
|
|
|||||
Operating lease obligations
(c)
|
190
|
|
|
40
|
|
|
55
|
|
|
34
|
|
|
61
|
|
|||||
Debt
(d)
|
3,907
|
|
|
381
|
|
|
879
|
|
|
858
|
|
|
1,789
|
|
|||||
Interest payments
(e)
|
1,551
|
|
|
154
|
|
|
297
|
|
|
238
|
|
|
862
|
|
|||||
Unrecognized tax benefits
(f)
|
144
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
144
|
|
|||||
Total contractual obligations
|
$
|
6,777
|
|
|
$
|
800
|
|
|
$
|
1,542
|
|
|
$
|
1,314
|
|
|
$
|
3,121
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other commitments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Letters of credit
(g)
|
$
|
77
|
|
|
$
|
77
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Includes raw material and service contracts where minimal committed quantities and prices are fixed.
|
(b)
|
Includes estimated funding of Ashland’s qualified U.S. and non-U.S. pension plans for 2016, as well as projected benefit payments through 2025 under Ashland’s unfunded pension and other postretirement benefit plans. Excludes the benefit payments from the pension plan trust funds. See Note M of Notes to Consolidated Financial Statements for additional information.
|
(c)
|
Includes leases for office buildings, retail outlets, transportation equipment, warehouses and storage facilities and other equipment. For further information, see Note K of Notes to Consolidated Financial Statements.
|
(d)
|
Capitalized lease obligations are not significant and are included within this caption. For further information, see Note I of Notes to Consolidated Financial Statements.
|
(e)
|
Includes interest expense on both variable and fixed rate debt assuming no prepayments. Variable interest rates have been assumed to remain constant through the end of the term at rates that existed as of September 30, 2015.
|
(f)
|
Due to uncertainties in the timing of the effective settlement of tax positions with respect to taxing authorities, Ashland is unable to determine the timing of payments related to noncurrent unrecognized tax benefits, including interest and penalties. Therefore, these amounts were included in the “More than 5 years” column.
|
(g)
|
Ashland issues various types of letters of credit as part of its normal course of business. For further information, see Note I of Notes to Consolidated Financial Statements.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Loss (gain) on pension and other postretirement plan remeasurement:
|
|
|
|
|
|
||||||
Change in discount rate and other actuarial assumptions
(a)
|
$
|
13
|
|
|
$
|
369
|
|
|
$
|
(575
|
)
|
Change in mortality table
(a)
|
47
|
|
|
149
|
|
|
—
|
|
|||
Actual return on plan assets
(a)
|
(15
|
)
|
|
(309
|
)
|
|
(161
|
)
|
|||
Expected return on plan assets
(a)
|
216
|
|
|
237
|
|
|
238
|
|
|||
Total actuarial loss (gain) on pension and other postretirement plan
|
|
|
|
|
|
||||||
remeasurement
|
261
|
|
|
446
|
|
|
(498
|
)
|
|||
Curtailment, settlement and other loss
|
(11
|
)
|
|
11
|
|
|
—
|
|
|||
Total loss (gain) on pension and other postretirement plan remeasurement
|
250
|
|
|
457
|
|
|
(498
|
)
|
|||
Less: Actuarial loss (gain) recognized in discontinued operations
|
2
|
|
|
44
|
|
|
(81
|
)
|
|||
Less: Curtailment, settlement and other gain in discontinued operations
|
(7
|
)
|
|
(25
|
)
|
|
—
|
|
|||
Total loss (gain) on pension and other postretirement plan
|
|
|
|
|
|
||||||
remeasurement from continuing operations
|
$
|
255
|
|
|
$
|
438
|
|
|
$
|
(417
|
)
|
|
|
|
|
|
|
(a)
|
For additional information on key assumptions and actual plan asset performance in each year, see the “Actuarial assumptions” discussion within this section.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Increase in pension costs from
|
|
|
|
|
|
||||||
Decrease in the discount rate
|
$
|
490
|
|
|
$
|
591
|
|
|
$
|
557
|
|
Increase in the salary adjustment rate
|
33
|
|
|
32
|
|
|
44
|
|
|||
Decrease in expected return on plan assets
|
30
|
|
|
31
|
|
|
33
|
|
|||
Increase in other postretirement costs from
|
|
|
|
|
|
||||||
Decrease in the discount rate
|
20
|
|
|
20
|
|
|
20
|
|
|
Page
|
Management's report on internal control over financial reporting
|
|
Reports of independent registered public accounting firm
|
|
|
|
Consolidated Financial Statements:
|
|
Statements of Consolidated Comprehensive Income
|
|
Consolidated Balance Sheets
|
|
Statements of Consolidated Stockholders’ Equity
|
|
Statements of Consolidated Cash Flows
|
|
Notes to Consolidated Financial Statements
|
|
Quarterly financial information
|
|
Five-year selected financial information
|
Ashland Inc. and Consolidated Subsidiaries
|
|
|
|
|
|
||||||
Statements of Consolidated Comprehensive Income
|
|
|
|
|
|
||||||
Years Ended September 30
|
|
|
|
|
|
||||||
(In millions except per share data)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Sales
|
$
|
5,387
|
|
|
$
|
6,121
|
|
|
$
|
6,091
|
|
Cost of sales
|
3,814
|
|
|
4,605
|
|
|
4,304
|
|
|||
Gross profit
|
1,573
|
|
|
1,516
|
|
|
1,787
|
|
|||
|
|
|
|
|
|
||||||
Selling, general and administrative expense
|
1,028
|
|
|
1,358
|
|
|
670
|
|
|||
Research and development expense
|
110
|
|
|
114
|
|
|
142
|
|
|||
Equity and other income - Note D
|
23
|
|
|
2
|
|
|
64
|
|
|||
Operating income
|
458
|
|
|
46
|
|
|
1,039
|
|
|||
|
|
|
|
|
|
||||||
Net interest and other financing expense - Note I
|
174
|
|
|
166
|
|
|
282
|
|
|||
Net gain (loss) on divestitures - Note B
|
(115
|
)
|
|
4
|
|
|
(8
|
)
|
|||
Income (loss) from continuing operations before income taxes
|
169
|
|
|
(116
|
)
|
|
749
|
|
|||
Income tax expense (benefit) - Note L
|
(22
|
)
|
|
(188
|
)
|
|
196
|
|
|||
Income from continuing operations
|
191
|
|
|
72
|
|
|
553
|
|
|||
Income from discontinued operations (net of tax) - Note C
|
118
|
|
|
161
|
|
|
130
|
|
|||
Net income
|
$
|
309
|
|
|
$
|
233
|
|
|
$
|
683
|
|
|
|
|
|
|
|
||||||
PER SHARE DATA - NOTE A
|
|
|
|
|
|
|
|
|
|||
Basic earnings per share
|
|
|
|
|
|
|
|
|
|||
Income from continuing operations
|
$
|
2.81
|
|
|
$
|
0.94
|
|
|
$
|
7.06
|
|
Income from discontinued operations
|
1.73
|
|
|
2.10
|
|
|
1.65
|
|
|||
Net income
|
$
|
4.54
|
|
|
$
|
3.04
|
|
|
$
|
8.71
|
|
|
|
|
|
|
|
|
|
|
|||
Diluted earnings per share
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
2.78
|
|
|
$
|
0.93
|
|
|
$
|
6.95
|
|
Income from discontinued operations
|
1.70
|
|
|
2.07
|
|
|
1.62
|
|
|||
Net income
|
$
|
4.48
|
|
|
$
|
3.00
|
|
|
$
|
8.57
|
|
|
|
|
|
|
|
||||||
COMPREHENSIVE INCOME (LOSS)
|
|
|
|
|
|
||||||
Net income
|
$
|
309
|
|
|
$
|
233
|
|
|
$
|
683
|
|
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
||||||
Unrealized translation gain (loss)
|
(369
|
)
|
|
(160
|
)
|
|
37
|
|
|||
Pension and postretirement obligation adjustment
|
(18
|
)
|
|
(21
|
)
|
|
(5
|
)
|
|||
Unrealized loss on available-for-sale securities
|
(11
|
)
|
|
—
|
|
|
—
|
|
|||
Net change in interest rate hedges
|
—
|
|
|
—
|
|
|
38
|
|
|||
Other comprehensive income (loss)
|
(398
|
)
|
|
(181
|
)
|
|
70
|
|
|||
Comprehensive income (loss)
|
$
|
(89
|
)
|
|
$
|
52
|
|
|
$
|
753
|
|
See Notes to Consolidated Financial Statements.
|
Ashland Inc. and Consolidated Subsidiaries
|
|
|
|
||||
Consolidated Balance Sheets
|
|
|
|
||||
At September 30
|
|
|
|
||||
(In millions)
|
2015
|
|
|
2014
|
|
||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,257
|
|
|
$
|
1,393
|
|
Accounts receivable
(a)
|
961
|
|
|
1,202
|
|
||
Inventories - Note A
|
706
|
|
|
765
|
|
||
Deferred income taxes - Note L
|
155
|
|
|
118
|
|
||
Other assets
|
169
|
|
|
83
|
|
||
Total current assets
|
3,248
|
|
|
3,561
|
|
||
Noncurrent assets
|
|
|
|
|
|
||
Property, plant and equipment - Note G
|
|
|
|
|
|
||
Cost
|
4,144
|
|
|
4,275
|
|
||
Accumulated depreciation
|
1,962
|
|
|
1,861
|
|
||
Net property, plant and equipment
|
2,182
|
|
|
2,414
|
|
||
Goodwill - Note H
|
2,486
|
|
|
2,643
|
|
||
Intangibles - Note H
|
1,142
|
|
|
1,309
|
|
||
Restricted investments - Note F
|
285
|
|
|
—
|
|
||
Asbestos insurance receivable - Note N
|
180
|
|
|
433
|
|
||
Equity and other unconsolidated investments - Note D
|
65
|
|
|
81
|
|
||
Other assets - Note J
|
476
|
|
|
479
|
|
||
Total noncurrent assets
|
6,816
|
|
|
7,359
|
|
||
Total assets
|
$
|
10,064
|
|
|
$
|
10,920
|
|
|
|
|
|
||||
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
||
Current liabilities
|
|
|
|
|
|
||
Short-term debt - Note I
|
$
|
326
|
|
|
$
|
329
|
|
Current portion of long-term debt - Note I
|
55
|
|
|
9
|
|
||
Trade and other payables
|
573
|
|
|
674
|
|
||
Accrued expenses and other liabilities
|
494
|
|
|
675
|
|
||
Total current liabilities
|
1,448
|
|
|
1,687
|
|
||
Noncurrent liabilities
|
|
|
|
|
|
||
Long-term debt - Note I
|
3,348
|
|
|
2,911
|
|
||
Employee benefit obligations - Note M
|
1,076
|
|
|
1,468
|
|
||
Asbestos litigation reserve - Note N
|
661
|
|
|
701
|
|
||
Deferred income taxes - Note L
|
89
|
|
|
110
|
|
||
Other liabilities - Note J
|
405
|
|
|
460
|
|
||
Total noncurrent liabilities
|
5,579
|
|
|
5,650
|
|
||
Commitments and contingencies - Notes K and N
|
|
|
|
|
|
||
Stockholders’ equity
- Notes O and P
|
|
|
|
|
|
||
Common stock, par value $.01 per share, 200 million shares authorized
|
|
|
|
|
|
||
Issued 67 million shares in 2015 and 70 million shares in 2014
|
1
|
|
|
1
|
|
||
Paid-in capital
|
46
|
|
|
—
|
|
||
Retained earnings
|
3,281
|
|
|
3,475
|
|
||
Accumulated other comprehensive income (loss)
|
(291
|
)
|
|
107
|
|
||
Total stockholders’ equity
|
3,037
|
|
|
3,583
|
|
||
Total liabilities and stockholders’ equity
|
$
|
10,064
|
|
|
$
|
10,920
|
|
|
|
|
|
(a)
|
Accounts receivable includes an allowance for doubtful accounts of
$11 million
in 2015 and
$13 million
in 2014.
|
See Notes to Consolidated Financial Statements.
|
Ashland Inc. and Consolidated Subsidiaries
|
|
|
|
|
|
|
|
|
|||||||||||
Statements of Consolidated Stockholders’ Equity
|
|
|
|
|
|
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|||||||||
|
|
|
|
|
|
|
other
|
|
|
|
|||||||||
|
Common
|
|
|
Paid-in
|
|
|
Retained
|
|
|
comprehensive
|
|
|
|
||||||
(In millions)
|
stock
|
|
|
capital
|
|
|
earnings
|
|
|
income (loss)
|
|
(a)
|
Total
|
|
|||||
Balance at September 30, 2012
|
$
|
1
|
|
|
$
|
647
|
|
|
$
|
3,163
|
|
|
$
|
218
|
|
|
$
|
4,029
|
|
Total comprehensive income
|
|
|
|
|
|
|
683
|
|
|
70
|
|
|
753
|
|
|||||
Dividends, $1.13 per common share
|
|
|
|
|
|
|
(88
|
)
|
|
|
|
|
(88
|
)
|
|||||
Common shares issued under stock incentive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
and other plans
(b) (c)
|
|
|
|
9
|
|
|
|
|
|
|
|
|
9
|
|
|||||
Repurchase of common shares
(d)
|
|
|
(150
|
)
|
|
|
|
|
|
(150
|
)
|
||||||||
Balance at September 30, 2013
|
1
|
|
|
506
|
|
|
3,758
|
|
|
288
|
|
|
4,553
|
|
|||||
Total comprehensive income (loss)
|
|
|
|
|
|
|
233
|
|
|
(181
|
)
|
|
52
|
|
|||||
Dividends, $1.36 per common share
|
|
|
|
|
|
|
(103
|
)
|
|
|
|
|
(103
|
)
|
|||||
Common shares issued under stock incentive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
and other plans
(b) (c)
|
|
|
|
35
|
|
|
|
|
|
|
|
|
35
|
|
|||||
Repurchase of common shares
(d)
|
|
|
(541
|
)
|
|
(413
|
)
|
|
|
|
(954
|
)
|
|||||||
Balance at September 30, 2014
|
1
|
|
|
—
|
|
|
3,475
|
|
|
107
|
|
|
3,583
|
|
|||||
Total comprehensive income (loss)
|
|
|
|
|
|
|
309
|
|
|
(398
|
)
|
|
(89
|
)
|
|||||
Dividends, $1.46 per common share
|
|
|
|
|
|
|
(98
|
)
|
|
|
|
|
(98
|
)
|
|||||
Common shares issued under stock incentive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
and other plans
(b) (c)
|
|
|
|
46
|
|
|
(8
|
)
|
|
|
|
|
38
|
|
|||||
Repurchase of common shares
(d)
|
|
|
|
|
(397
|
)
|
|
|
|
(397
|
)
|
||||||||
Balance at September 30, 2015
|
$
|
1
|
|
|
$
|
46
|
|
|
$
|
3,281
|
|
|
$
|
(291
|
)
|
|
$
|
3,037
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
At
September 30, 2015
and
2014
, the accumulated other comprehensive loss of
$291 million
and income of
$107 million
, respectively, was comprised of unrecognized prior service credits as a result of certain employee benefit plan amendments of
$41 million
and
$59 million
, respectively, net unrealized translation loss of
$321 million
and gain of
$48 million
, respectively, and net unrealized loss on available for sale securities of
$11 million
and
zero
, respectively.
|
(b)
|
Includes income tax benefits resulting from the exercise of stock options of
$8 million
in
2015
,
$23 million
in
2014
and
$1 million
in
2013
.
|
(c)
|
Common shares issued were
441,609
,
615,049
and
415,351
for
2015
,
2014
and
2013
, respectively.
|
(d)
|
Common shares repurchased were
3,944,356
,
7,812,342
and
1,737,744
for
2015
,
2014
and
2013
, respectively.
|
See Notes to Consolidated Financial Statements.
|
Ashland Inc. and Consolidated Subsidiaries
|
|
|
|
|
|
||||||
Statements of Consolidated Cash Flows
|
|
|
|
|
|
||||||
Years Ended September 30
|
|
|
|
|
|
||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Cash flows provided (used) by operating activities from continuing operations
|
|
|
|
|
|
||||||
Net income
|
$
|
309
|
|
|
$
|
233
|
|
|
$
|
683
|
|
Income from discontinued operations (net of tax)
|
(118
|
)
|
|
(161
|
)
|
|
(130
|
)
|
|||
Adjustments to reconcile income from continuing operations
|
|
|
|
|
|
|
|
|
|||
to cash flows from operating activities
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
341
|
|
|
393
|
|
|
356
|
|
|||
Debt issuance cost amortization
|
18
|
|
|
14
|
|
|
65
|
|
|||
Deferred income taxes
|
(57
|
)
|
|
(294
|
)
|
|
153
|
|
|||
Equity income from affiliates
|
(15
|
)
|
|
(25
|
)
|
|
(26
|
)
|
|||
Distributions from equity affiliates
|
22
|
|
|
14
|
|
|
11
|
|
|||
Stock based compensation expense - Note P
|
30
|
|
|
34
|
|
|
30
|
|
|||
Loss on early retirement of debt
|
9
|
|
|
—
|
|
|
—
|
|
|||
Gain on available-for-sale securities
|
(3
|
)
|
|
—
|
|
|
—
|
|
|||
Net loss (gain) on divestitures - Note B
|
115
|
|
|
(4
|
)
|
|
8
|
|
|||
Impairments of equity investments and in-process research and development
|
25
|
|
|
63
|
|
|
41
|
|
|||
Pension contributions
|
(610
|
)
|
|
(38
|
)
|
|
(124
|
)
|
|||
Losses (gains) on pension and other postretirement plan remeasurements
|
255
|
|
|
438
|
|
|
(417
|
)
|
|||
Change in operating assets and liabilities
(a)
|
(232
|
)
|
|
(87
|
)
|
|
3
|
|
|||
Total cash flows provided by operating activities from continuing operations
|
89
|
|
|
580
|
|
|
653
|
|
|||
Cash flows provided (used) by investing activities from continuing operations
|
|
|
|
|
|
|
|
|
|||
Additions to property, plant and equipment
|
(265
|
)
|
|
(248
|
)
|
|
(264
|
)
|
|||
Proceeds from disposal of property, plant and equipment
|
3
|
|
|
3
|
|
|
5
|
|
|||
Purchase of operations - net of cash acquired
|
(13
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds (uses) from sale of operations or equity investments
|
161
|
|
|
92
|
|
|
(13
|
)
|
|||
Proceeds from sale of available-for-sale securities
|
315
|
|
|
—
|
|
|
—
|
|
|||
Purchase of available-for-sale securities
|
(315
|
)
|
|
—
|
|
|
—
|
|
|||
Funds restricted for specific transactions
|
(320
|
)
|
|
(15
|
)
|
|
—
|
|
|||
Reimbursement from restricted investments
|
6
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from the settlement of derivative instruments
|
18
|
|
|
—
|
|
|
—
|
|
|||
Payments for the settlement of derivative instruments
|
(7
|
)
|
|
—
|
|
|
—
|
|
|||
Total cash flows used by investing activities from continuing operations
|
(417
|
)
|
|
(168
|
)
|
|
(272
|
)
|
|||
Cash flows provided (used) by financing activities from continuing operations
|
|
|
|
|
|
|
|
|
|||
Proceeds from issuance of long-term debt
|
1,100
|
|
|
—
|
|
|
2,320
|
|
|||
Repayment of long-term debt
|
(623
|
)
|
|
(11
|
)
|
|
(2,613
|
)
|
|||
Premium on long-term debt repayment
|
(9
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds (repayment) from short-term debt
|
(3
|
)
|
|
22
|
|
|
(36
|
)
|
|||
Repurchase of common stock
|
(397
|
)
|
|
(954
|
)
|
|
(150
|
)
|
|||
Debt issuance costs
|
(9
|
)
|
|
—
|
|
|
(38
|
)
|
|||
Cash dividends paid
|
(98
|
)
|
|
(103
|
)
|
|
(88
|
)
|
|||
Excess tax benefits related to share-based payments
|
9
|
|
|
12
|
|
|
13
|
|
|||
Total cash flows used by financing activities from continuing operations
|
(30
|
)
|
|
(1,034
|
)
|
|
(592
|
)
|
|||
Cash used by continuing operations
|
(358
|
)
|
|
(622
|
)
|
|
(211
|
)
|
|||
Cash provided (used) by discontinued operations
|
|
|
|
|
|
|
|
|
|||
Operating cash flows
|
245
|
|
|
63
|
|
|
80
|
|
|||
Investing cash flows
|
24
|
|
|
1,608
|
|
|
(48
|
)
|
|||
Total cash provided by discontinued operations
|
269
|
|
|
1,671
|
|
|
32
|
|
|||
Effect of currency exchange rate changes on cash and cash equivalents
|
(47
|
)
|
|
(2
|
)
|
|
2
|
|
|||
Increase (decrease) in cash and cash equivalents
|
(136
|
)
|
|
1,047
|
|
|
(177
|
)
|
|||
Cash and cash equivalents - beginning of year
|
1,393
|
|
|
346
|
|
|
523
|
|
|||
Cash and cash equivalents - end of year
|
$
|
1,257
|
|
|
$
|
1,393
|
|
|
$
|
346
|
|
|
|
|
|
|
|
||||||
Changes in assets and liabilities
(a)
|
|
|
|
|
|
|
|
|
|||
Accounts receivable
|
$
|
261
|
|
|
$
|
(16
|
)
|
|
$
|
43
|
|
Inventories
|
39
|
|
|
(4
|
)
|
|
106
|
|
|||
Trade and other payables
|
(229
|
)
|
|
64
|
|
|
(7
|
)
|
|||
Other assets and liabilities
|
(303
|
)
|
|
(131
|
)
|
|
(139
|
)
|
|||
Change in operating assets and liabilities
|
$
|
(232
|
)
|
|
$
|
(87
|
)
|
|
$
|
3
|
|
Supplemental disclosures
|
|
|
|
|
|
|
|
|
|||
Interest paid
|
$
|
149
|
|
|
$
|
154
|
|
|
$
|
182
|
|
Income taxes paid
|
226
|
|
|
88
|
|
|
69
|
|
|||
|
|
|
|
|
|
(a)
|
Excludes changes resulting from operations acquired or sold.
|
See Notes to Consolidated Financial Statements.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Allowance for doubtful accounts - beginning of year
|
$
|
13
|
|
|
$
|
12
|
|
|
$
|
19
|
|
Adjustments to net income
|
2
|
|
|
5
|
|
|
(4
|
)
|
|||
Reserves utilized
|
(3
|
)
|
|
(4
|
)
|
|
(3
|
)
|
|||
Other changes
|
(1
|
)
|
|
—
|
|
|
—
|
|
|||
Allowance for doubtful accounts - end of year
|
$
|
11
|
|
|
$
|
13
|
|
|
$
|
12
|
|
(In millions)
|
2015
|
|
|
2014
|
|
||
Finished products
|
$
|
542
|
|
|
$
|
557
|
|
Raw materials, supplies and work in process
|
198
|
|
|
239
|
|
||
LIFO reserves
|
(34
|
)
|
|
(31
|
)
|
||
|
$
|
706
|
|
|
$
|
765
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Inventory reserves - beginning of year
|
$
|
53
|
|
|
$
|
59
|
|
|
$
|
28
|
|
Adjustments to net income
|
9
|
|
|
4
|
|
|
42
|
|
|||
Reserves utilized
|
(6
|
)
|
|
(10
|
)
|
|
(11
|
)
|
|||
Dispositions and other changes
|
(21
|
)
|
|
—
|
|
|
—
|
|
|||
Inventory reserves - end of year
|
$
|
35
|
|
|
$
|
53
|
|
|
$
|
59
|
|
(In millions) |
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Tax valuation allowances - beginning of year
|
$
|
148
|
|
|
$
|
166
|
|
|
$
|
175
|
|
Adjustments to net income
|
(27
|
)
|
|
(5
|
)
|
|
(6
|
)
|
|||
Reserves utilized
|
(14
|
)
|
|
(14
|
)
|
|
(2
|
)
|
|||
Acquisition and other changes
|
—
|
|
|
1
|
|
|
(1
|
)
|
|||
Tax valuation allowances - end of year
|
$
|
107
|
|
|
$
|
148
|
|
|
$
|
166
|
|
(In millions except per share data)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Numerator
|
|
|
|
|
|
||||||
Numerator for basic and diluted EPS -
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
191
|
|
|
$
|
72
|
|
|
$
|
553
|
|
Denominator
|
|
|
|
|
|
|
|
|
|||
Denominator for basic EPS - Weighted-average
|
|
|
|
|
|
|
|
|
|||
common shares outstanding
|
68
|
|
|
77
|
|
|
78
|
|
|||
Share based awards convertible to common shares
|
1
|
|
|
1
|
|
|
2
|
|
|||
Denominator for diluted EPS - Adjusted weighted-
|
|
|
|
|
|
|
|||||
average shares and assumed conversions
|
69
|
|
|
78
|
|
|
80
|
|
|||
EPS from continuing operations
|
|
|
|
|
|
|
|||||
Basic
|
$
|
2.81
|
|
|
$
|
0.94
|
|
|
$
|
7.06
|
|
Diluted
|
2.78
|
|
|
0.93
|
|
|
6.95
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Income (loss) from discontinued operations
|
|
|
|
|
|
||||||
Asbestos-related litigation matters
|
$
|
132
|
|
|
$
|
5
|
|
|
$
|
(3
|
)
|
Water Technologies
|
(3
|
)
|
|
84
|
|
|
202
|
|
|||
Distribution
|
(3
|
)
|
|
—
|
|
|
(9
|
)
|
|||
Gain on disposal of discontinued operations
|
|
|
|
|
|
|
|
|
|||
Water Technologies
|
4
|
|
|
148
|
|
|
—
|
|
|||
Income before taxes
|
130
|
|
|
237
|
|
|
190
|
|
|||
Income tax benefit (expense)
|
|
|
|
|
|
|
|
|
|||
Benefit (expense) related to income (loss) from discontinued operations
|
|
|
|
|
|
|
|
|
|||
Asbestos-related litigation reserves and expenses
|
(22
|
)
|
|
1
|
|
|
5
|
|
|||
Water Technologies
|
2
|
|
|
(25
|
)
|
|
(78
|
)
|
|||
Distribution
|
1
|
|
|
—
|
|
|
3
|
|
|||
Benefit (expense) related to gain (loss) on disposal of discontinued operations
|
|
|
|
|
|
|
|
|
|||
Water Technologies
|
3
|
|
|
(56
|
)
|
|
—
|
|
|||
Distribution
|
3
|
|
|
—
|
|
|
—
|
|
|||
APAC
|
1
|
|
|
4
|
|
|
10
|
|
|||
Income from discontinued operations (net of taxes)
|
$
|
118
|
|
|
$
|
161
|
|
|
$
|
130
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Financial position
|
|
|
|
|
|
||||||
Current assets
|
$
|
211
|
|
|
$
|
292
|
|
|
|
||
Current liabilities
|
(54
|
)
|
|
(98
|
)
|
|
|
||||
Working capital
|
157
|
|
|
194
|
|
|
|
||||
Noncurrent assets
|
40
|
|
|
45
|
|
|
|
||||
Noncurrent liabilities
|
(1
|
)
|
|
(1
|
)
|
|
|
||||
Stockholders’ equity
|
$
|
196
|
|
|
$
|
238
|
|
|
|
||
Results of operations
|
|
|
|
|
|
||||||
Sales
|
$
|
398
|
|
|
$
|
966
|
|
|
$
|
1,181
|
|
Income from operations
|
57
|
|
|
74
|
|
|
79
|
|
|||
Net income
|
31
|
|
|
63
|
|
|
53
|
|
|||
Amounts recorded by Ashland
|
|
|
|
|
|
||||||
Investments and advances
|
$
|
65
|
|
|
$
|
81
|
|
|
$
|
213
|
|
Equity income (loss)
(a)
|
1
|
|
|
(25
|
)
|
|
26
|
|
|||
Distributions received
|
22
|
|
|
14
|
|
|
11
|
|
|||
|
|
|
|
|
|
(a)
|
The results in 2015 and 2014 include a
$14 million
and
$50 million
impairment on the Valvoline joint venture in Venezuela and the ASK joint venture, respectively.
|
|
|
|
Facility
|
|
|
|
|||||
(In millions)
|
Severance
|
|
|
costs
|
|
|
Total
|
|
|||
Balance as of September 30, 2012
|
$
|
29
|
|
|
$
|
15
|
|
|
$
|
44
|
|
Reserve adjustments
|
9
|
|
|
—
|
|
|
9
|
|
|||
Utilization (cash paid)
|
(21
|
)
|
|
(7
|
)
|
|
(28
|
)
|
|||
Balance as of September 30, 2013
|
17
|
|
|
8
|
|
|
25
|
|
|||
Restructuring reserves
|
95
|
|
|
4
|
|
|
99
|
|
|||
Reserve adjustments
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|||
Utilization (cash paid)
|
(52
|
)
|
|
(3
|
)
|
|
(55
|
)
|
|||
Balance as of September 30, 2014
|
56
|
|
|
9
|
|
|
65
|
|
|||
Reserve adjustments
|
(3
|
)
|
|
(2
|
)
|
|
(5
|
)
|
|||
Utilization (cash paid)
|
(45
|
)
|
|
(4
|
)
|
|
(49
|
)
|
|||
Balance as of September 30, 2015
|
$
|
8
|
|
|
$
|
3
|
|
|
$
|
11
|
|
|
|
|
Quoted prices
|
|
|
|
|
|
|||||||||||
|
|
|
|
|
in active
|
|
|
Significant
|
|
|
|
||||||||
|
|
|
|
|
markets for
|
|
|
other
|
|
|
Significant
|
|
|||||||
|
|
|
|
|
identical
|
|
|
observable
|
|
|
unobservable
|
|
|||||||
|
Carrying
|
|
|
Total fair
|
|
|
assets
|
|
|
inputs
|
|
|
inputs
|
|
|||||
(In millions)
|
value
|
|
|
value
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
1,257
|
|
|
$
|
1,257
|
|
|
$
|
1,257
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted investments
(a)
|
315
|
|
|
315
|
|
|
315
|
|
|
—
|
|
|
—
|
|
|||||
Deferred compensation investments
(b)
|
180
|
|
|
180
|
|
|
40
|
|
|
140
|
|
|
—
|
|
|||||
Investments of captive insurance company
(b)
|
4
|
|
|
4
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|||||
Foreign currency derivatives
|
13
|
|
|
13
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|||||
Total assets at fair value
|
$
|
1,769
|
|
|
$
|
1,769
|
|
|
$
|
1,616
|
|
|
$
|
153
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Foreign currency derivatives
|
$
|
16
|
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
16
|
|
|
$
|
—
|
|
Total liabilities at fair value
|
$
|
16
|
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
16
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Included in restricted investments and
$30 million
within other current assets in the Consolidated Balance Sheets.
|
(b)
|
Included in other noncurrent assets in the Consolidated Balance Sheets.
|
|
|
|
Quoted prices
|
|
|
|
|
|
|||||||||||
|
|
|
|
|
in active
|
|
|
Significant
|
|
|
|
||||||||
|
|
|
|
|
markets for
|
|
|
other
|
|
|
Significant
|
|
|||||||
|
|
|
|
|
identical
|
|
|
observable
|
|
|
unobservable
|
|
|||||||
|
Carrying
|
|
|
Total fair
|
|
|
assets
|
|
|
inputs
|
|
|
inputs
|
|
|||||
(In millions)
|
value
|
|
|
value
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
1,393
|
|
|
$
|
1,393
|
|
|
$
|
1,393
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Deferred compensation investments
(a)
|
184
|
|
|
184
|
|
|
45
|
|
|
139
|
|
|
—
|
|
|||||
Investments of captive insurance company
(a)
|
3
|
|
|
3
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|||||
Foreign currency derivatives
|
11
|
|
|
11
|
|
|
—
|
|
|
11
|
|
|
—
|
|
|||||
Total assets at fair value
|
$
|
1,591
|
|
|
$
|
1,591
|
|
|
$
|
1,441
|
|
|
$
|
150
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Foreign currency derivatives
|
$
|
9
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
9
|
|
|
$
|
—
|
|
Total liabilities at fair value
|
$
|
9
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Included in other noncurrent assets in the Consolidated Balance Sheets.
|
(In millions)
|
Original
|
|
|
Investment
|
|
|
Unrealized
|
|
|
Unrealized
|
|
|
|
|
Fair
|
|
|||||
As of September 30, 2015
|
Cost
|
|
|
Income
(a)
|
|
|
gain
|
|
|
loss
|
|
|
Disbursements
|
|
|
Value
|
|
||||
Demand deposit
|
$
|
20
|
|
|
3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
(6
|
)
|
|
$
|
17
|
|
Equity mutual fund
|
195
|
|
|
—
|
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|
181
|
|
||||
Corporate bond mutual fund
|
120
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
117
|
|
||||
Total
|
$
|
335
|
|
|
3
|
|
|
$
|
—
|
|
|
$
|
(17
|
)
|
|
(6
|
)
|
|
$
|
315
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Investment income for the demand deposit includes interest income as well as dividend income transferred from the equity and corporate bond mutual funds.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Foreign currency derivative gains (losses)
|
$
|
(17
|
)
|
|
$
|
(7
|
)
|
|
$
|
1
|
|
(In millions)
|
2015
|
|
|
2014
|
|
||
Foreign currency derivative assets
|
$
|
5
|
|
|
$
|
2
|
|
Notional contract values
|
192
|
|
|
88
|
|
||
|
|
|
|
||||
Foreign currency derivative liabilities
|
$
|
16
|
|
|
$
|
4
|
|
Notional contract values
|
673
|
|
|
281
|
|
(In millions)
|
Consolidated balance sheet caption
|
2015
|
|
|
2014
|
|
||
Net investment hedge assets
|
Accounts receivable
|
$
|
8
|
|
|
$
|
9
|
|
Net investment hedge liabilities
(a)
|
Accrued expenses and other liabilities
|
—
|
|
|
5
|
|
||
|
|
|
|
|
(a)
|
Fair values of $0 denote a value less than $1 million.
|
(In millions)
|
2015
|
|
|
2014
|
|
||
Change in unrealized gain in AOCI
|
$
|
8
|
|
|
$
|
4
|
|
Tax impact of change in unrealized gain in AOCI
|
(2
|
)
|
|
(3
|
)
|
(In millions)
|
2015
|
|
|
2014
|
|
||
Land
|
$
|
202
|
|
|
$
|
228
|
|
Buildings
|
710
|
|
|
730
|
|
||
Machinery and equipment
|
2,957
|
|
|
3,049
|
|
||
Construction in progress
|
275
|
|
|
268
|
|
||
Total property, plant and equipment (gross)
|
4,144
|
|
|
4,275
|
|
||
Accumulated depreciation
|
(1,962
|
)
|
|
(1,861
|
)
|
||
Total property, plant and equipment (net)
|
$
|
2,182
|
|
|
$
|
2,414
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Depreciation
|
$
|
263
|
|
|
$
|
304
|
|
|
$
|
268
|
|
Capitalized interest
|
2
|
|
|
1
|
|
|
1
|
|
|
Specialty
|
|
|
Performance
|
|
|
|
|
|
||||||
(In millions)
|
Ingredients
|
|
|
Materials
|
|
(a)
|
Valvoline
|
|
|
Total
|
|
||||
Balance at September 30, 2013
|
$
|
2,231
|
|
|
$
|
311
|
|
|
$
|
167
|
|
|
$
|
2,709
|
|
Business realignment adjustment
(b)
|
(39
|
)
|
|
39
|
|
|
—
|
|
|
—
|
|
||||
Currency translation
|
(63
|
)
|
|
(4
|
)
|
|
1
|
|
|
(66
|
)
|
||||
Balance at September 30, 2014
|
2,129
|
|
|
346
|
|
|
168
|
|
|
2,643
|
|
||||
Acquisitions
(c)
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
|
||||
Divestitures
(d)
|
(10
|
)
|
|
(10
|
)
|
|
(1
|
)
|
|
(21
|
)
|
||||
Currency translation
|
(115
|
)
|
|
(23
|
)
|
|
(1
|
)
|
|
(139
|
)
|
||||
Balance at September 30, 2015
|
$
|
2,004
|
|
|
$
|
313
|
|
|
$
|
169
|
|
|
$
|
2,486
|
|
|
|
|
|
|
|
|
|
(a)
|
As of
September 30, 2015
, goodwill consisted of
$142 million
for the Composites reporting unit and
$171 million
for the Intermediates/Solvents reporting unit.
|
(b)
|
Business realignment adjustment represents the reallocation of goodwill during 2014 as a result of the transfer of Adhesives and Intermediates/Solvents between the Specialty Ingredients and Performance Materials reportable segments. In the fourth quarter of 2014, an error of
$32 million
was identified in the amount of goodwill associated with Intermediates/Solvents that was originally reallocated in the third quarter of 2014. The amount of goodwill transferred from Specialty Ingredients to Performance Materials was revised from
$71 million
to
$39 million
to correct the error. Ashland does not believe that this revision was material to the previously filed financial information.
|
(c)
|
Relates to Valvoline Instant Oil Change
SM
acquisitions during 2015.
|
(d)
|
Divestiture caption represents the amounts of goodwill for the sale of Elastomers, Valvoline car care products and industrial biocides. See Note B for additional information.
|
|
2015
|
|
2014
|
||||||||||||||||||||
|
Gross
|
|
|
|
|
Net
|
|
|
Gross
|
|
|
|
|
Net
|
|
||||||||
|
carrying
|
|
|
Accumulated
|
|
|
carrying
|
|
|
carrying
|
|
|
Accumulated
|
|
|
carrying
|
|
||||||
(In millions)
|
amount
|
|
|
amortization
|
|
|
amount
|
|
|
amount
|
|
|
amortization
|
|
|
amount
|
|
||||||
Definite-lived intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trademarks and trade names
(a)
|
$
|
48
|
|
|
$
|
(41
|
)
|
|
$
|
7
|
|
|
$
|
72
|
|
|
$
|
(49
|
)
|
|
$
|
23
|
|
Intellectual property
(b)
|
813
|
|
|
(266
|
)
|
|
547
|
|
|
827
|
|
|
(226
|
)
|
|
601
|
|
||||||
Customer relationships
(c)
|
424
|
|
|
(147
|
)
|
|
277
|
|
|
481
|
|
|
(118
|
)
|
|
363
|
|
||||||
Total definite-lived intangible assets
|
1,285
|
|
|
(454
|
)
|
|
831
|
|
|
1,380
|
|
|
(393
|
)
|
|
987
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Indefinite-lived intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
IPR&D
|
8
|
|
|
—
|
|
|
8
|
|
|
19
|
|
|
—
|
|
|
19
|
|
||||||
Trademarks and trade names
|
303
|
|
|
—
|
|
|
303
|
|
|
303
|
|
|
—
|
|
|
303
|
|
||||||
Total intangible assets
|
$
|
1,596
|
|
|
$
|
(454
|
)
|
|
$
|
1,142
|
|
|
$
|
1,702
|
|
|
$
|
(393
|
)
|
|
$
|
1,309
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Divested trademarks and trade names during 2015 had gross carrying amounts of
$6 million
,
$7 million
and
$11 million
for Elastomers, Valvoline car care products and industrial biocides, respectively, and accumulated amortization of
$5 million
,
$3 million
and
$3 million
, respectively.
|
(b)
|
Divested intellectual property during 2015 had a gross carrying amount of
$18 million
with
$5 million
of accumulated amortization for Elastomers.
|
(c)
|
Divested customer relationships during 2015 had a gross carrying amount and accumulated amortization of
$1 million
each for Valvoline car care products.
|
(In millions)
|
2015
|
|
|
2014
|
|
||
4.750% notes, due 2022
|
$
|
1,120
|
|
|
$
|
1,120
|
|
Term Loan, due 2020
|
1,086
|
|
|
—
|
|
||
3.875% notes, due 2018
|
700
|
|
|
700
|
|
||
6.875% notes, due 2043
|
376
|
|
|
376
|
|
||
Accounts receivable securitization
(a)
|
190
|
|
|
255
|
|
||
6.50% junior subordinated notes, due 2029
|
136
|
|
|
134
|
|
||
Revolving credit facility
|
110
|
|
|
45
|
|
||
Other international loans, interest at a weighted-
|
|
|
|
|
|
||
average rate of 6.2% at September 30, 2015 (5.3% to 9.5%)
|
25
|
|
|
29
|
|
||
Medium-term notes, due 2019, interest of 9.4% at September 30, 2015
|
5
|
|
|
14
|
|
||
3.000% notes, due 2016
|
—
|
|
|
600
|
|
||
Other
(b)
|
(19
|
)
|
|
(24
|
)
|
||
Total debt
|
3,729
|
|
|
3,249
|
|
||
Short-term debt
|
(326
|
)
|
|
(329
|
)
|
||
Current portion of long-term debt
|
(55
|
)
|
|
(9
|
)
|
||
Long-term debt (less current portion and debt issuance cost discounts)
|
$
|
3,348
|
|
|
$
|
2,911
|
|
|
|
|
|
(a)
|
During 2015, the potential funding for qualified receivables was reduced from
$275 million
to
$250 million
.
|
(b)
|
Other includes
$28 million
and
$31 million
of debt issuance cost discounts as of
September 30, 2015
and
2014
, respectively.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Interest expense
(a)
|
$
|
166
|
|
|
$
|
163
|
|
|
$
|
273
|
|
Interest income
|
(6
|
)
|
|
(6
|
)
|
|
(4
|
)
|
|||
Available-for-sale securities income
(b)
|
(3
|
)
|
|
—
|
|
|
—
|
|
|||
Other financing costs
(c)
|
17
|
|
|
9
|
|
|
13
|
|
|||
|
$
|
174
|
|
|
$
|
166
|
|
|
$
|
282
|
|
|
|
|
|
|
|
(a)
|
Includes
$4 million
and
$50 million
of accelerated amortization for debt issuance costs during 2015 and 2013, respectively, and the
$52 million
charge to terminate the interest rate swaps associated with the term loan A and term loan B facilities during 2013.
|
(b)
|
Represents investment income related to the restricted investments discussed in Note F.
|
(c)
|
Includes
$9 million
related to the early redemption premium payments for the tender and redemption of the 2016 senior notes during 2015 and a
$4 million
redemption premium payment related to the
$78 million
principal
9.125%
senior notes redeemed during 2013.
|
(In millions)
|
2015
|
|
(a)
|
2014
|
|
|
2013
|
|
(b)
|
|||
Normal amortization
|
$
|
14
|
|
|
$
|
14
|
|
|
$
|
15
|
|
|
Accelerated amortization
|
4
|
|
|
—
|
|
|
50
|
|
|
|||
Total
|
$
|
18
|
|
|
$
|
14
|
|
|
$
|
65
|
|
|
|
|
|
|
|
|
|
(a)
|
Accelerated amortization of
$4 million
for debt issuance costs resulting from early redemption of the 2016 senior notes and the entrance into the 2015 Senior Credit Agreement.
|
(b)
|
Accelerated amortization of
$47 million
and
$3 million
resulted from the repayment of the 2011 Senior Credit Facility and the early paydown of Ashland’s remaining
9.125%
senior notes, respectively.
|
(In millions)
|
2015
|
|
|
2014
|
|
||
Deferred compensation investments
|
$
|
180
|
|
|
$
|
184
|
|
Debt issuance costs
|
16
|
|
|
18
|
|
||
Note receivables
|
36
|
|
|
44
|
|
||
Manufacturing catalyst supplies
|
37
|
|
|
24
|
|
||
Environmental insurance receivables
|
16
|
|
|
24
|
|
||
Land use rights
|
22
|
|
|
23
|
|
||
Defined benefit plan assets
|
29
|
|
|
22
|
|
||
Life insurance policies
|
18
|
|
|
18
|
|
||
Tax receivables
|
7
|
|
|
17
|
|
||
Customer incentive
|
16
|
|
|
16
|
|
||
Debt defeasance assets
|
6
|
|
|
15
|
|
||
Other
|
93
|
|
|
74
|
|
||
|
$
|
476
|
|
|
$
|
479
|
|
(In millions)
|
2015
|
|
|
2014
|
|
||
Environmental remediation reserves
|
$
|
139
|
|
|
$
|
158
|
|
Accrued tax liabilities (including sales and franchise)
|
103
|
|
|
74
|
|
||
Deferred compensation
|
66
|
|
|
72
|
|
||
Reserves related to workers compensation and general liability
|
24
|
|
|
50
|
|
||
Other
|
73
|
|
|
106
|
|
||
|
$
|
405
|
|
|
$
|
460
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
(a)
|
|||
Minimum rentals (including rentals under short-term leases)
|
$
|
57
|
|
|
$
|
69
|
|
|
$
|
57
|
|
|
Contingent rentals
|
4
|
|
|
7
|
|
|
6
|
|
|
|||
Sublease rental income
|
(2
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
|||
|
$
|
59
|
|
|
$
|
74
|
|
|
$
|
61
|
|
|
|
|
|
|
|
|
|
(a)
|
The table above excludes
$13 million
of lease commitments during 2013 that were related to the Water Technologies business that have been reclassified to discontinued operations due to its sale in July 2014.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Current
|
|
|
|
|
|
||||||
Federal
|
$
|
(32
|
)
|
|
$
|
34
|
|
|
$
|
7
|
|
State
|
1
|
|
|
10
|
|
|
(6
|
)
|
|||
Foreign
|
66
|
|
|
62
|
|
|
42
|
|
|||
|
35
|
|
|
106
|
|
|
43
|
|
|||
Deferred
|
(57
|
)
|
|
(294
|
)
|
|
153
|
|
|||
Income tax expense (benefit)
|
$
|
(22
|
)
|
|
$
|
(188
|
)
|
|
$
|
196
|
|
(In millions)
|
2015
|
|
|
2014
|
|
||
Deferred tax assets
|
|
|
|
||||
Foreign net operating loss carryforwards
(a)
|
$
|
81
|
|
|
$
|
84
|
|
Employee benefit obligations
|
392
|
|
|
544
|
|
||
Environmental, self-insurance and litigation reserves (net of receivables)
|
218
|
|
|
172
|
|
||
State net operating loss carryforwards
(b)
|
73
|
|
|
58
|
|
||
Compensation accruals
|
88
|
|
|
91
|
|
||
Credit carryforwards
(c)
|
89
|
|
|
25
|
|
||
Other items
|
26
|
|
|
65
|
|
||
Valuation allowances
(d)
|
(107
|
)
|
|
(148
|
)
|
||
Total deferred tax assets
|
860
|
|
|
891
|
|
||
Deferred tax liabilities
|
|
|
|
|
|
||
Goodwill and other intangibles
(e)
|
371
|
|
|
409
|
|
||
Property, plant and equipment
|
351
|
|
|
416
|
|
||
Unremitted earnings
|
11
|
|
|
19
|
|
||
Total deferred tax liabilities
|
733
|
|
|
844
|
|
||
Net deferred tax asset (liability)
|
$
|
127
|
|
|
$
|
47
|
|
|
|
|
|
(a)
|
Gross net operating loss carryforwards will expire in future years as follows:
$2 million
in
2016
,
$13 million
in
2017
and the remaining balance in other future years.
|
(b)
|
Gross net operating loss carryforwards include offset for uncertain tax positions of and will expire in future years as follows:
$20 million
in
2016
,
$38 million
in
2017
and the remaining balance in other future years.
|
(c)
|
Credit carryforwards include offset for uncertain tax positions and consist primarily of foreign tax credits of
$67 million
expiring in future years beyond
2017
and alternative minimum tax credits of
$12 million
with no expiration date.
|
(d)
|
Valuation allowances primarily relate to certain state and foreign net operating loss carryforwards.
|
(e)
|
The total gross amount of goodwill as of
September 30, 2015
expected to be deductible for tax purposes is
$38 million
.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Income (loss) from continuing operations before income taxes
|
|
|
|
|
|
||||||
United States
(a), (b)
|
$
|
(158
|
)
|
|
$
|
(364
|
)
|
|
$
|
466
|
|
Foreign
(b)
|
327
|
|
|
248
|
|
|
283
|
|
|||
Total income (loss) from continuing operations before income taxes
|
$
|
169
|
|
|
$
|
(116
|
)
|
|
$
|
749
|
|
|
|
|
|
|
|
||||||
Income taxes computed at U.S. statutory rate (35%)
|
$
|
59
|
|
|
$
|
(40
|
)
|
|
$
|
262
|
|
Increase (decrease) in amount computed resulting from
|
|
|
|
|
|
|
|
|
|||
Net gain on divestitures
(c)
|
11
|
|
|
37
|
|
|
—
|
|
|||
Uncertain tax positions
|
23
|
|
|
33
|
|
|
11
|
|
|||
Valuation allowance charges
(d)
|
(29
|
)
|
|
14
|
|
|
(12
|
)
|
|||
Claim for research and development credits
(e)
|
(7
|
)
|
|
(2
|
)
|
|
(14
|
)
|
|||
State taxes
(f)
|
(8
|
)
|
|
(16
|
)
|
|
23
|
|
|||
Net impact of foreign results
(g)
|
(73
|
)
|
|
(214
|
)
|
|
(74
|
)
|
|||
Other items
|
2
|
|
|
—
|
|
|
—
|
|
|||
Income tax expense (benefit)
|
$
|
(22
|
)
|
|
$
|
(188
|
)
|
|
$
|
196
|
|
|
|
|
|
|
|
(a)
|
A significant component of the fluctuations within this caption relates to the annual remeasurements of the U.S. pension and other postretirement plans.
|
(b)
|
Prior year amounts for income (loss) from continuing operations before income taxes for the United States and Foreign line items have been revised to reflect a change in the classification of the elimination of foreign intercompany dividends. There was no impact on the total of income (loss) from continuing operations before income taxes or on the computation of income tax expense (benefit) for the years ended September 30,
2014
and
2013
and therefore Ashland does not believe that this revision is material to the previously filed financial information.
|
(c)
|
2015 includes adjustments related to the sale of Valvoline Venezuela JV, Elastomers and the Biocides divestitures of
$5 million
,
$4 million
and
$2 million
respectively. 2014 tax adjustments associated with the Water Technologies business and ASK divestitures are a
$39 million
charge and
$2 million
gain respectively.
|
(d)
|
Related to foreign and state deferred tax asset valuation allowances/(releases).
|
(e)
|
2015 and 2013 include a benefit related to credits signed into law on a retroactive basis.
|
(f)
|
2014 and 2013 include expense of
$5 million
and
$7 million
, respectively, recorded for deferred tax adjustments, primarily attributable to state rate changes.
|
(g)
|
2014 includes a
$168 million
tax benefit related to the reversal of deferred tax liabilities for outside basis differences and other related matters and a
$14 million
expense recorded for a rate change in a foreign jurisdiction. 2013 includes a
$17 million
benefit recorded for a rate change in a foreign jurisdiction.
|
(In millions)
|
|
|
|
Balance at September 30, 2013
|
$
|
133
|
|
Increases related to positions taken on items from prior years
|
29
|
|
|
Decreases related to positions taken on items from prior years
|
(13
|
)
|
|
Increases related to positions taken in the current year
|
31
|
|
|
Lapse of statute of limitations
|
(13
|
)
|
|
Disposition of Water Technologies
|
(12
|
)
|
|
Balance at September 30, 2014
|
155
|
|
|
Increases related to positions taken on items from prior years
|
10
|
|
|
Decreases related to positions taken on items from prior years
|
(15
|
)
|
|
Increases related to positions taken in the current year
|
24
|
|
|
Lapse of statute of limitations
|
(6
|
)
|
|
Settlement of uncertain tax positions with tax authorities
|
(24
|
)
|
|
Balance at September 30, 2015
|
$
|
144
|
|
|
Pension benefits
|
|
Other postretirement benefits
|
||||||||||||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
||||||
Net periodic benefit costs (income)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service cost
|
$
|
26
|
|
|
$
|
38
|
|
|
$
|
43
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
2
|
|
Interest cost
|
175
|
|
|
190
|
|
|
175
|
|
|
8
|
|
|
9
|
|
|
7
|
|
||||||
Curtailment, settlement and other
|
(11
|
)
|
|
31
|
|
|
—
|
|
|
—
|
|
|
(20
|
)
|
|
—
|
|
||||||
Expected return on plan assets
|
(216
|
)
|
|
(237
|
)
|
|
(238
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Amortization of prior service credit
(a)
|
(4
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
(17
|
)
|
|
(21
|
)
|
|
(21
|
)
|
||||||
Actuarial loss (gain)
|
260
|
|
|
431
|
|
|
(472
|
)
|
|
1
|
|
|
15
|
|
|
(26
|
)
|
||||||
|
$
|
230
|
|
|
$
|
451
|
|
|
$
|
(494
|
)
|
|
$
|
(7
|
)
|
|
$
|
(15
|
)
|
|
$
|
(38
|
)
|
Weighted-average plan assumptions
(b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
4.18
|
%
|
|
4.68
|
%
|
|
3.70
|
%
|
|
3.85
|
%
|
|
4.28
|
%
|
|
3.23
|
%
|
||||||
Rate of compensation increase
|
3.18
|
%
|
|
3.59
|
%
|
|
3.66
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Expected long-term rate of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
return on plan assets
|
7.27
|
%
|
|
7.67
|
%
|
|
7.26
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Changes to the post-65 Ashland Medical plan resulted in negative plan amendments that are being amortized within the other postretirement benefits caption.
|
(b)
|
The plan assumptions discussed are a blended weighted-average rate for Ashland’s U.S. and non-U.S. plans. The U.S. pension plan represented approximately
90%
of the projected benefit obligation at
September 30, 2015
. Other postretirement benefit plans consist of U.S. and Canada, with the U.S. plan representing approximately
93%
of the accumulated postretirement benefit obligation at
September 30, 2015
. Non-U.S. plans use assumptions generally consistent with those of U.S. plans.
|
|
Pension
|
|
Postretirement
|
||||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
||||
Prior service cost (credit)
|
$
|
2
|
|
|
$
|
(6
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Curtailment, settlement and other
|
3
|
|
|
3
|
|
|
—
|
|
|
10
|
|
||||
Amortization of prior service credit
|
4
|
|
|
2
|
|
|
17
|
|
|
21
|
|
||||
Total
|
$
|
9
|
|
|
$
|
(1
|
)
|
|
$
|
17
|
|
|
$
|
31
|
|
|
|
|
|
|
|
|
|
||||||||
Total recognized in net periodic benefit cost (income)
|
|
|
|
|
|
|
|
|
|
|
|
||||
and accumulated other comprehensive income
|
$
|
239
|
|
|
$
|
450
|
|
|
$
|
10
|
|
|
$
|
16
|
|
|
|
|
|
Other
|
|
|||
|
Pension
|
|
|
postretirement
|
|
|||
(In millions)
|
benefits
|
|
|
|
benefits
|
|
||
Prior service credit
|
$
|
(2
|
)
|
|
|
$
|
(16
|
)
|
|
Pension
|
|
Postretirement
|
||||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
||||
Prior service credit
|
$
|
(12
|
)
|
|
$
|
(21
|
)
|
|
$
|
(45
|
)
|
|
$
|
(62
|
)
|
|
|
|
|
|
Other postretirement
|
||||||||||
|
Pension plans
|
|
benefit plans
|
||||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
||||
Change in benefit obligations
|
|
|
|
|
|
|
|
||||||||
Benefit obligations at October 1
|
$
|
4,326
|
|
|
$
|
4,307
|
|
|
$
|
210
|
|
|
$
|
217
|
|
Service cost
|
26
|
|
|
38
|
|
|
1
|
|
|
2
|
|
||||
Interest cost
|
175
|
|
|
190
|
|
|
8
|
|
|
9
|
|
||||
Participant contributions
|
1
|
|
|
2
|
|
|
15
|
|
|
12
|
|
||||
Benefits paid
|
(217
|
)
|
|
(245
|
)
|
|
(33
|
)
|
|
(34
|
)
|
||||
Actuarial loss
|
59
|
|
|
503
|
|
|
1
|
|
|
15
|
|
||||
Plan amendment
|
2
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
||||
Foreign currency exchange rate changes
|
(40
|
)
|
|
(15
|
)
|
|
(3
|
)
|
|
(1
|
)
|
||||
Other
|
14
|
|
|
4
|
|
|
—
|
|
|
—
|
|
||||
Divestiture
|
—
|
|
|
(127
|
)
|
|
—
|
|
|
—
|
|
||||
Curtailment and settlement
|
(527
|
)
|
|
(325
|
)
|
|
—
|
|
|
(10
|
)
|
||||
Benefit obligations at September 30
|
$
|
3,819
|
|
|
$
|
4,326
|
|
|
$
|
199
|
|
|
$
|
210
|
|
Change in plan assets
|
|
|
|
|
|
|
|
|
|
|
|
||||
Value of plan assets at October 1
|
$
|
3,075
|
|
|
$
|
3,381
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Actual return on plan assets
|
15
|
|
|
309
|
|
|
—
|
|
|
—
|
|
||||
Employer contributions
|
610
|
|
|
43
|
|
|
18
|
|
|
22
|
|
||||
Participant contributions
|
1
|
|
|
2
|
|
|
15
|
|
|
12
|
|
||||
Benefits paid
|
(217
|
)
|
|
(245
|
)
|
|
(33
|
)
|
|
(34
|
)
|
||||
Foreign currency exchange rate changes
|
(28
|
)
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
||||
Settlement
|
(519
|
)
|
|
(359
|
)
|
|
—
|
|
|
—
|
|
||||
Divestiture
|
—
|
|
|
(57
|
)
|
|
—
|
|
|
—
|
|
||||
Other
|
14
|
|
|
6
|
|
|
—
|
|
|
—
|
|
||||
Value of plan assets at September 30
|
$
|
2,951
|
|
|
$
|
3,075
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Unfunded status of the plans
|
$
|
(868
|
)
|
|
$
|
(1,251
|
)
|
|
$
|
(199
|
)
|
|
$
|
(210
|
)
|
|
|
|
|
|
|
|
|
||||||||
Amounts recognized in the balance sheet
|
|
|
|
|
|
|
|
|
|
|
|
||||
Noncurrent benefit assets
|
$
|
29
|
|
|
$
|
22
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Current benefit liabilities
|
(19
|
)
|
|
(15
|
)
|
|
(17
|
)
|
|
(19
|
)
|
||||
Noncurrent benefit liabilities
|
(878
|
)
|
|
(1,258
|
)
|
|
(182
|
)
|
|
(191
|
)
|
||||
Net amount recognized
|
$
|
(868
|
)
|
|
$
|
(1,251
|
)
|
|
$
|
(199
|
)
|
|
$
|
(210
|
)
|
|
|
|
|
|
|
|
|
||||||||
Weighted-average plan assumptions
|
|
|
|
|
|
|
|
|
|
|
|
||||
Discount rate
|
4.21
|
%
|
|
4.18
|
%
|
|
3.93
|
%
|
|
3.85
|
%
|
||||
Rate of compensation increase
|
3.01
|
%
|
|
3.18
|
%
|
|
—
|
|
|
—
|
|
|
2015
|
|
2014
|
||||||||||||||||||||
|
|
|
Non-
|
|
|
|
|
|
|
Non-
|
|
|
|
||||||||||
|
Qualified
|
|
|
qualified
|
|
|
|
|
Qualified
|
|
|
qualified
|
|
|
|
||||||||
(In millions)
|
plans
(a)
|
|
|
plans
|
|
|
Total
|
|
|
plans
(a)
|
|
|
plans
|
|
|
Total
|
|
||||||
Projected benefit obligation
|
$
|
3,446
|
|
|
$
|
162
|
|
|
$
|
3,608
|
|
|
$
|
3,930
|
|
|
$
|
172
|
|
|
$
|
4,102
|
|
Accumulated benefit obligation
|
3,390
|
|
|
156
|
|
|
3,546
|
|
|
3,880
|
|
|
165
|
|
|
4,045
|
|
||||||
Fair value of plan assets
|
2,712
|
|
|
—
|
|
|
2,712
|
|
|
2,832
|
|
|
—
|
|
|
2,832
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Includes qualified U.S. and non-U.S. pension plans.
|
|
Quoted prices
|
|
|
|
|
|
|||||||||
|
|
|
in active
|
|
|
Significant
|
|
|
|
||||||
|
|
|
markets for
|
|
|
other
|
|
|
Significant
|
|
|||||
|
|
|
identical
|
|
|
observable
|
|
|
unobservable
|
|
|||||
|
Total fair
|
|
|
assets
|
|
|
inputs
|
|
|
inputs
|
|
||||
(In millions)
|
value
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
||||
Cash and cash equivalents
|
$
|
91
|
|
|
$
|
91
|
|
|
$
|
—
|
|
|
$
|
—
|
|
U.S. government securities
|
130
|
|
|
4
|
|
|
126
|
|
|
—
|
|
||||
Other government securities
|
163
|
|
|
1
|
|
|
162
|
|
|
—
|
|
||||
Corporate debt instruments
|
1,398
|
|
|
1,036
|
|
|
362
|
|
|
—
|
|
||||
Corporate stocks
|
289
|
|
|
146
|
|
|
143
|
|
|
—
|
|
||||
Insurance contracts
|
10
|
|
|
—
|
|
|
10
|
|
|
—
|
|
||||
Private equity and hedge funds
|
842
|
|
|
—
|
|
|
—
|
|
|
842
|
|
||||
Other investments
|
28
|
|
|
—
|
|
|
—
|
|
|
28
|
|
||||
Total assets at fair value
|
$
|
2,951
|
|
|
$
|
1,278
|
|
|
$
|
803
|
|
|
$
|
870
|
|
|
Quoted prices
|
|
|
|
|
|
|||||||||
|
|
|
in active
|
|
|
Significant
|
|
|
|
||||||
|
|
|
markets for
|
|
|
other
|
|
|
Significant
|
|
|||||
|
|
|
identical
|
|
|
observable
|
|
|
unobservable
|
|
|||||
|
Total fair
|
|
|
assets
|
|
|
inputs
|
|
|
inputs
|
|
||||
(In millions)
|
value
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
||||
Cash and cash equivalents
|
$
|
102
|
|
|
$
|
102
|
|
|
$
|
—
|
|
|
$
|
—
|
|
U.S. government securities
|
180
|
|
|
7
|
|
|
173
|
|
|
—
|
|
||||
Other government securities
|
165
|
|
|
—
|
|
|
165
|
|
|
—
|
|
||||
Corporate debt instruments
|
1,172
|
|
|
788
|
|
|
384
|
|
|
—
|
|
||||
Corporate stocks
|
326
|
|
|
158
|
|
|
168
|
|
|
—
|
|
||||
Insurance contracts
|
12
|
|
|
—
|
|
|
12
|
|
|
—
|
|
||||
Private equity and hedge funds
|
1,085
|
|
|
—
|
|
|
—
|
|
|
1,085
|
|
||||
Other investments
|
33
|
|
|
—
|
|
|
—
|
|
|
33
|
|
||||
Total assets at fair value
|
$
|
3,075
|
|
|
$
|
1,055
|
|
|
$
|
902
|
|
|
$
|
1,118
|
|
|
Total
|
|
|
Private
|
|
|
|
||||
|
Level 3
|
|
|
equity and
|
|
|
Other
|
|
|||
(In millions)
|
assets
|
|
|
hedge funds
|
|
|
investments
|
|
|||
Balance as of September 30, 2013
|
$
|
1,228
|
|
|
$
|
1,190
|
|
|
$
|
38
|
|
Purchases
|
71
|
|
|
71
|
|
|
—
|
|
|||
Sales
|
(258
|
)
|
|
(258
|
)
|
|
—
|
|
|||
Actual return on plan assets
|
|
|
|
|
|
||||||
Relating to assets held at September 30, 2014
|
67
|
|
|
72
|
|
|
(5
|
)
|
|||
Relating to assets sold during 2014
|
10
|
|
|
10
|
|
|
—
|
|
|||
Balance as of September 30, 2014
|
1,118
|
|
|
1,085
|
|
|
33
|
|
|||
Purchases
|
1
|
|
|
1
|
|
|
—
|
|
|||
Sales
|
(252
|
)
|
|
(252
|
)
|
|
—
|
|
|||
Actual return on plan assets
|
|
|
|
|
|
||||||
Relating to assets held at September 30, 2015
|
3
|
|
|
8
|
|
|
(5
|
)
|
|||
Relating to assets sold during 2015
|
—
|
|
|
—
|
|
|
—
|
|
|||
Balance as of September 30, 2015
|
$
|
870
|
|
|
$
|
842
|
|
|
$
|
28
|
|
|
|
|
Actual at September 30
|
||||
(In millions)
|
Target
|
|
2015
|
|
|
2014
|
|
Plan assets allocation
|
|
|
|
|
|
||
Equity securities
|
15 - 60%
|
|
42
|
%
|
|
51
|
%
|
Debt securities
|
40 - 85%
|
|
56
|
%
|
|
47
|
%
|
Other
|
0 - 20%
|
|
2
|
%
|
|
2
|
%
|
|
|
|
100
|
%
|
|
100
|
%
|
|
|
|
|
Other
|
|
|||
|
Pension
|
|
|
postretirement
|
|
|||
(In millions)
|
benefits
|
|
|
|
benefits
|
|
||
2016
|
$
|
240
|
|
|
|
$
|
18
|
|
2017
|
235
|
|
|
|
17
|
|
||
2018
|
235
|
|
|
|
17
|
|
||
2019
|
236
|
|
|
|
17
|
|
||
2020
|
237
|
|
|
|
16
|
|
||
2021 - 2025
|
1,189
|
|
|
|
71
|
|
(In thousands)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Open claims - beginning of year
|
65
|
|
|
65
|
|
|
66
|
|
New claims filed
|
2
|
|
|
2
|
|
|
2
|
|
Claims settled
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
Claims dismissed
|
(7
|
)
|
|
(1
|
)
|
|
(2
|
)
|
Open claims - end of year
|
60
|
|
|
65
|
|
|
65
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Asbestos reserve - beginning of year
|
$
|
438
|
|
|
$
|
463
|
|
|
$
|
522
|
|
Reserve adjustment
|
—
|
|
|
4
|
|
|
(28
|
)
|
|||
Amounts paid
|
(29
|
)
|
|
(29
|
)
|
|
(31
|
)
|
|||
Asbestos reserve - end of year
|
$
|
409
|
|
|
$
|
438
|
|
|
$
|
463
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Insurance receivable - beginning of year
|
$
|
402
|
|
|
$
|
408
|
|
|
$
|
423
|
|
Receivable adjustment
|
(3
|
)
|
|
22
|
|
|
(3
|
)
|
|||
Insurance settlement
|
(227
|
)
|
|
—
|
|
|
—
|
|
|||
Amounts collected
|
(22
|
)
|
|
(28
|
)
|
|
(12
|
)
|
|||
Insurance receivable - end of year
|
$
|
150
|
|
|
$
|
402
|
|
|
$
|
408
|
|
(In thousands)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Open claims - beginning of year
|
21
|
|
|
21
|
|
|
21
|
|
New claims filed
|
1
|
|
|
1
|
|
|
1
|
|
Claims dismissed
|
(2
|
)
|
|
(1
|
)
|
|
(1
|
)
|
Open claims - end of year
|
20
|
|
|
21
|
|
|
21
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Asbestos reserve - beginning of year
|
$
|
329
|
|
|
$
|
342
|
|
|
$
|
320
|
|
Reserve adjustments
|
4
|
|
|
10
|
|
|
46
|
|
|||
Amounts paid
|
(22
|
)
|
|
(23
|
)
|
|
(24
|
)
|
|||
Asbestos reserve - end of year
|
$
|
311
|
|
|
$
|
329
|
|
|
$
|
342
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Insurance receivable - beginning of year
|
$
|
77
|
|
|
$
|
75
|
|
|
$
|
56
|
|
Receivable adjustment
|
1
|
|
|
3
|
|
|
19
|
|
|||
Insurance settlement
|
(22
|
)
|
|
—
|
|
|
—
|
|
|||
Amounts collected
|
—
|
|
|
(1
|
)
|
|
—
|
|
|||
Insurance receivable - end of year
|
$
|
56
|
|
|
$
|
77
|
|
|
$
|
75
|
|
(In millions)
|
2015
|
|
|
2014
|
|
||
Environmental remediation reserve - beginning of year
|
$
|
197
|
|
|
$
|
211
|
|
Disbursements
|
(47
|
)
|
|
(46
|
)
|
||
Revised obligation estimates and accretion
|
36
|
|
|
32
|
|
||
Environmental remediation reserve - end of year
|
$
|
186
|
|
|
$
|
197
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Environmental expense
|
$
|
32
|
|
|
$
|
29
|
|
|
$
|
28
|
|
Accretion
|
4
|
|
|
3
|
|
|
3
|
|
|||
Legal expense
|
6
|
|
|
5
|
|
|
2
|
|
|||
Total expense
|
42
|
|
|
37
|
|
|
33
|
|
|||
|
|
|
|
|
|
||||||
Insurance receivable
|
(2
|
)
|
|
(4
|
)
|
|
(4
|
)
|
|||
Total expense, net of receivable activity
(a)
|
$
|
40
|
|
|
$
|
33
|
|
|
$
|
29
|
|
|
|
|
|
|
|
(a)
|
Net expense of
$5 million
,
$4 million
and
$6 million
for the fiscal years ended
September 30, 2015
,
2014
and
2013
, respectively, relates to divested businesses which qualified for treatment as discontinued operations and for which certain environmental liabilities were retained by Ashland. These amounts are classified within the income from discontinued operations caption of the Statements of Consolidated Comprehensive Income.
|
|
|
|
Tax
|
|
|
|
|||||
|
Before
|
|
|
(expense)
|
|
|
Net of
|
|
|||
(In millions)
|
tax
|
|
|
benefit
|
|
|
tax
|
|
|||
Year ended September 30, 2015
|
|
|
|
|
|
||||||
Other comprehensive income (loss)
|
|
|
|
|
|
||||||
Unrealized translation loss
|
$
|
(368
|
)
|
|
$
|
(1
|
)
|
|
$
|
(369
|
)
|
Pension and postretirement obligation adjustment:
|
|
|
|
|
|
||||||
Adjustment of unrecognized prior service cost
|
(2
|
)
|
|
1
|
|
|
(1
|
)
|
|||
Amortization of unrecognized prior service
|
|
|
|
|
|
||||||
credits included in net income
(a)
|
(24
|
)
|
|
7
|
|
|
(17
|
)
|
|||
Unrealized loss on available-for-sale securities
|
(17
|
)
|
|
6
|
|
|
(11
|
)
|
|||
Total other comprehensive income (loss)
|
$
|
(411
|
)
|
|
$
|
13
|
|
|
$
|
(398
|
)
|
|
|
|
|
|
|
||||||
Year ended September 30, 2014
|
|
|
|
|
|
||||||
Other comprehensive income (loss)
|
|
|
|
|
|
||||||
Net change in translation gain (loss):
|
|
|
|
|
|
||||||
Unrealized translation loss
|
$
|
(163
|
)
|
|
$
|
(3
|
)
|
|
$
|
(166
|
)
|
Reclassification adjustment for losses
|
|
|
|
|
|
||||||
included in net income
(b)
|
6
|
|
|
—
|
|
|
6
|
|
|||
Pension and postretirement obligation adjustment:
|
|
|
|
|
|
||||||
Adjustment of unrecognized prior service credit
|
6
|
|
|
(2
|
)
|
|
4
|
|
|||
Amortization of unrecognized prior service
|
|
|
|
|
|
||||||
credits included in net income
(a)
|
(36
|
)
|
|
11
|
|
|
(25
|
)
|
|||
Total other comprehensive income (loss)
|
$
|
(187
|
)
|
|
$
|
6
|
|
|
$
|
(181
|
)
|
|
|
|
|
|
|
||||||
Year ended September 30, 2013
|
|
|
|
|
|
||||||
Other comprehensive income (loss)
|
|
|
|
|
|
||||||
Unrealized translation gain (loss)
|
$
|
45
|
|
|
$
|
(8
|
)
|
|
$
|
37
|
|
Pension and postretirement obligation adjustment:
|
|
|
|
|
|
||||||
Adjustment of unrecognized prior service credit
|
13
|
|
|
(3
|
)
|
|
10
|
|
|||
Amortization of unrecognized prior service
|
|
|
|
|
|
||||||
credits included in net income
(a)
|
(23
|
)
|
|
8
|
|
|
(15
|
)
|
|||
Net change in interest rate hedges:
|
|
|
|
|
|
||||||
Unrealized loss during period
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||
Reclassification adjustment for losses
|
|
|
|
|
|
||||||
included in net income
(c)
|
65
|
|
|
(24
|
)
|
|
41
|
|
|||
Total other comprehensive income (loss)
|
$
|
97
|
|
|
$
|
(27
|
)
|
|
$
|
70
|
|
|
|
|
|
|
|
(a)
|
Amortization of unrecognized prior service credits are included in the calculation of net periodic benefit costs (income) for pension and other postretirement plans. For specific financial statement captions impacted by the amortization see the table below.
|
(b)
|
Losses from the translation adjustment included in net income are attributable to foreign Water Technologies subsidiaries sold with the divestiture. These adjustments are recorded in the discontinued operations caption of the Statements of Consolidated Comprehensive Income.
|
(c)
|
Losses from interest rate hedges are recorded in the net interest and other financing expense caption of the Statements of Consolidated Comprehensive Income. See Note F for further information.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Cost of sales
|
$
|
(8
|
)
|
|
$
|
(6
|
)
|
|
$
|
(6
|
)
|
Selling, general and administrative expense
|
(13
|
)
|
|
(14
|
)
|
|
(14
|
)
|
|||
Discontinued operations
|
(3
|
)
|
|
(16
|
)
|
|
(3
|
)
|
|||
Total amortization of unrecognized prior service credits
|
$
|
(24
|
)
|
|
$
|
(36
|
)
|
|
$
|
(23
|
)
|
(In millions)
|
2015
|
|
(a)
|
2014
|
|
|
2013
|
|
|||
SARs
|
$
|
10
|
|
|
$
|
16
|
|
|
$
|
17
|
|
Nonvested stock awards
|
15
|
|
|
10
|
|
|
4
|
|
|||
Performance share awards
|
13
|
|
|
8
|
|
|
9
|
|
|||
|
$
|
38
|
|
|
$
|
34
|
|
|
$
|
30
|
|
|
|
|
|
|
|
||||||
Income tax benefit
|
$
|
13
|
|
|
$
|
13
|
|
|
$
|
11
|
|
|
|
|
|
|
|
(a)
|
The year ended
September 30, 2015
included a
$7 million
award modification within performance shares that was designated as a cash item (see table on F-52 for further information) and
$1 million
of expense related primarily to cash-settled nonvested restricted stock awards.
|
(In millions except per share data)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Weighted-average fair value per share of SARs granted
|
$
|
30.70
|
|
|
$
|
34.96
|
|
|
$
|
29.93
|
|
Assumptions (weighted-average)
|
|
|
|
|
|
|
|
||||
Risk-free interest rate
|
1.7
|
%
|
|
1.4
|
%
|
|
0.7
|
%
|
|||
Expected dividend yield
|
1.2
|
%
|
|
1.5
|
%
|
|
1.3
|
%
|
|||
Expected volatility
|
31.8
|
%
|
|
49.7
|
%
|
|
55.0
|
%
|
|||
Expected life (in years)
|
5
|
|
|
5
|
|
|
5
|
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||
|
Number
|
|
|
Weighted-
|
|
|
Number
|
|
|
Weighted-
|
|
|
Number
|
|
|
Weighted-
|
|
|||
|
of
|
|
|
average
|
|
|
of
|
|
|
average
|
|
|
of
|
|
|
average
|
|
|||
|
common
|
|
|
exercise price
|
|
|
common
|
|
|
exercise price
|
|
|
common
|
|
|
exercise price
|
|
|||
(In thousands except per share data)
|
shares
|
|
|
per share
|
|
|
shares
|
|
|
per share
|
|
|
shares
|
|
|
per share
|
|
|||
Outstanding - beginning of year
|
1,798
|
|
|
$
|
62.85
|
|
|
2,658
|
|
|
$
|
55.84
|
|
|
2,908
|
|
|
$
|
45.94
|
|
Granted
|
277
|
|
|
113.65
|
|
|
391
|
|
|
89.69
|
|
|
888
|
|
|
70.41
|
|
|||
Exercised
|
(584
|
)
|
|
58.80
|
|
|
(1,123
|
)
|
|
54.14
|
|
|
(1,037
|
)
|
|
39.95
|
|
|||
Forfeitures and expirations
|
(108
|
)
|
|
83.00
|
|
|
(128
|
)
|
|
75.82
|
|
|
(101
|
)
|
|
61.96
|
|
|||
Outstanding - end of year
(a)
|
1,383
|
|
|
73.18
|
|
|
1,798
|
|
|
62.85
|
|
|
2,658
|
|
|
55.84
|
|
|||
Exercisable - end of year
|
906
|
|
|
59.92
|
|
|
1,066
|
|
|
53.80
|
|
|
1,390
|
|
|
47.46
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Exercise prices per share for SARs outstanding at
September 30, 2015
ranged from
$9.49
to
$49.79
for
139
shares, from
$51.86
to
$55.73
for
329
shares, from
$64.92
to
$89.69
for
652
shares, and from
$112.91
to
$117.38
for
263
shares. The weighted-average remaining contractual life of outstanding SARs and stock options was
6.8
years and exercisable SARs and stock options was
5.9
years.
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||
|
Number
|
|
|
Weighted-
|
|
|
Number
|
|
|
Weighted-
|
|
|
Number
|
|
|
Weighted-
|
|
|||
|
of
|
|
|
average
|
|
|
of
|
|
|
average
|
|
|
of
|
|
|
average
|
|
|||
|
common
|
|
|
grant date
|
|
|
common
|
|
|
grant date
|
|
|
common
|
|
|
grant date
|
|
|||
(In thousands except per share data)
|
shares
|
|
|
fair value
|
|
|
shares
|
|
|
fair value
|
|
|
shares
|
|
|
fair value
|
|
|||
Nonvested - beginning of year
|
221
|
|
|
$
|
88.81
|
|
|
140
|
|
|
$
|
56.97
|
|
|
333
|
|
|
$
|
33.80
|
|
Granted
|
187
|
|
|
114.97
|
|
|
192
|
|
|
94.17
|
|
|
22
|
|
|
84.12
|
|
|||
Vested
|
(69
|
)
|
|
77.51
|
|
|
(78
|
)
|
|
47.07
|
|
|
(205
|
)
|
|
22.50
|
|
|||
Forfeitures
|
(41
|
)
|
|
99.20
|
|
|
(33
|
)
|
|
83.84
|
|
|
(10
|
)
|
|
51.01
|
|
|||
Nonvested - end of year
|
298
|
|
|
106.41
|
|
|
221
|
|
|
88.81
|
|
|
140
|
|
|
56.97
|
|
|
|
|
|
|
Weighted-
|
|
||
|
|
|
Target
|
|
|
average
|
|
|
|
|
|
shares
|
|
|
fair value
|
|
|
(In thousands)
|
Performance period
|
|
granted
|
|
(a)
|
per share
|
|
|
Fiscal Year 2015
|
October 1, 2014 - September 30, 2017
|
|
77
|
|
|
$
|
121.87
|
|
Fiscal Year 2014
|
October 1, 2013 - September 30, 2016
|
|
110
|
|
|
$
|
85.84
|
|
Fiscal Year 2013
|
October 1, 2012 - September 30, 2015
|
|
134
|
|
|
$
|
73.50
|
|
|
|
|
|
|
|
(a)
|
At the end of the performance period, the actual number of shares issued can range from
zero
to
200%
of the target shares granted, which is assumed to be
100%
.
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Risk-free interest rate
|
0.1% - 1.0%
|
|
|
0.1% - 0.6%
|
|
|
0.2% - 0.3%
|
|
Expected dividend yield
|
1.4
|
%
|
|
1.4
|
%
|
|
1.3
|
%
|
Expected life (in years)
|
3
|
|
|
3
|
|
|
3
|
|
Expected volatility
|
24.2
|
%
|
|
32.1
|
%
|
|
37.6
|
%
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||
|
|
|
Weighted-
|
|
|
|
|
Weighted-
|
|
|
|
|
Weighted-
|
|
||||||
|
|
|
average
|
|
|
|
|
average
|
|
|
|
|
average
|
|
||||||
|
|
|
grant date
|
|
|
|
|
grant date
|
|
|
|
|
grant date
|
|
||||||
(In thousands except per share data)
|
Shares
|
|
|
fair value
|
|
|
Shares
|
|
|
fair value
|
|
|
Shares
|
|
|
fair value
|
|
|||
Nonvested - beginning of year
|
368
|
|
|
$
|
72.20
|
|
|
433
|
|
|
$
|
65.05
|
|
|
480
|
|
|
$
|
54.39
|
|
Granted
(a)
|
103
|
|
|
115.19
|
|
|
155
|
|
|
81.09
|
|
|
152
|
|
|
69.74
|
|
|||
Vested
(a)
|
(133
|
)
|
|
68.18
|
|
|
(183
|
)
|
|
62.05
|
|
|
(175
|
)
|
|
39.55
|
|
|||
Forfeitures
(b)
|
(134
|
)
|
|
74.79
|
|
|
(37
|
)
|
|
75.02
|
|
|
(24
|
)
|
|
67.06
|
|
|||
Nonvested - end of year
|
204
|
|
|
93.79
|
|
|
368
|
|
|
72.20
|
|
|
433
|
|
|
65.05
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
The current year includes
26
additional shares from the fiscal 2012 through 2014 plan, 2014 includes
45
additional shares from the fiscal 2011 through 2013 plan and 2013 includes
18
additional shares from the fiscal 2010 through 2012 plan since a portion of each plans payout was in excess of the initial
100%
target.
|
(b)
|
During the December 2014 quarter, Ashland modified certain awards of its performance shares. The awards were modified to provide that the instruments be paid in cash instead of stock. This change in payment designation caused Ashland to recognize
$7 million
in incremental stock-based compensation expense related to
84
shares modified during 2015.
|
|
Sales from
|
|
|
|
|
|
Property, plant
|
||||||||||||||||||||
|
external customers
|
|
Net assets (liabilities)
|
|
and equipment - net
|
||||||||||||||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
|||||||
United States
|
$
|
2,715
|
|
|
$
|
3,076
|
|
|
$
|
3,130
|
|
|
$
|
(575
|
)
|
|
$
|
(160
|
)
|
|
$
|
1,569
|
|
|
$
|
1,721
|
|
International
|
2,672
|
|
|
3,045
|
|
|
2,961
|
|
|
3,612
|
|
|
3,743
|
|
|
613
|
|
|
693
|
|
|||||||
|
$
|
5,387
|
|
|
$
|
6,121
|
|
|
$
|
6,091
|
|
|
$
|
3,037
|
|
|
$
|
3,583
|
|
|
$
|
2,182
|
|
|
$
|
2,414
|
|
(a)
|
Includes sales for biocides through July 1, 2015 sale.
|
(b)
|
Includes sales only through December 1, 2014 sale.
|
(c)
|
Includes sales for car care products through June 30, 2015 sale.
|
Ashland Inc. and Consolidated Subsidiaries
|
|
|
|
|
|
||||||
Reportable Segment Information
|
|
|
|
|
|
||||||
Years Ended September 30
|
|
|
|
|
|
||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Sales
|
|
|
|
|
|
||||||
Specialty Ingredients
|
$
|
2,263
|
|
|
$
|
2,498
|
|
|
$
|
2,478
|
|
Performance Materials
|
1,157
|
|
|
1,582
|
|
|
1,617
|
|
|||
Valvoline
|
1,967
|
|
|
2,041
|
|
|
1,996
|
|
|||
|
$
|
5,387
|
|
|
$
|
6,121
|
|
|
$
|
6,091
|
|
Equity income (expense)
|
|
|
|
|
|
|
|
|
|||
Specialty Ingredients
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
4
|
|
Performance Materials
|
2
|
|
|
(38
|
)
|
|
10
|
|
|||
Valvoline
|
(2
|
)
|
|
10
|
|
|
13
|
|
|||
Unallocated and other
|
—
|
|
|
1
|
|
|
(1
|
)
|
|||
|
1
|
|
|
(25
|
)
|
|
26
|
|
|||
Other income (expense)
|
|
|
|
|
|
|
|
|
|||
Specialty Ingredients
|
(1
|
)
|
|
(2
|
)
|
|
14
|
|
|||
Performance Materials
|
5
|
|
|
5
|
|
|
6
|
|
|||
Valvoline
|
10
|
|
|
20
|
|
|
11
|
|
|||
Unallocated and other
|
8
|
|
|
4
|
|
|
7
|
|
|||
|
22
|
|
|
27
|
|
|
38
|
|
|||
|
$
|
23
|
|
|
$
|
2
|
|
|
$
|
64
|
|
Operating income (loss)
|
|
|
|
|
|
|
|
|
|||
Specialty Ingredients
|
$
|
239
|
|
|
$
|
253
|
|
|
$
|
243
|
|
Performance Materials
|
87
|
|
|
7
|
|
|
106
|
|
|||
Valvoline
|
359
|
|
|
323
|
|
|
295
|
|
|||
Unallocated and other
|
(227
|
)
|
|
(537
|
)
|
|
395
|
|
|||
|
$
|
458
|
|
|
$
|
46
|
|
|
$
|
1,039
|
|
Assets
|
|
|
|
|
|
|
|
|
|||
Specialty Ingredients
|
$
|
5,365
|
|
|
$
|
5,756
|
|
|
$
|
5,994
|
|
Performance Materials
|
1,079
|
|
|
1,395
|
|
|
1,518
|
|
|||
Valvoline
|
976
|
|
|
1,073
|
|
|
1,051
|
|
|||
Unallocated and other
|
2,644
|
|
|
2,696
|
|
|
3,488
|
|
|||
|
$
|
10,064
|
|
|
$
|
10,920
|
|
|
$
|
12,051
|
|
Ashland Inc. and Consolidated Subsidiaries
|
|
|
|
|
|
||||||
Reportable Segment Information (continued)
|
|
|
|
|
|
||||||
Years Ended September 30
|
|
|
|
|
|
||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Equity and other unconsolidated investments
|
|
|
|
|
|
||||||
Specialty Ingredients
|
$
|
9
|
|
|
$
|
10
|
|
|
$
|
12
|
|
Performance Materials
(a)
|
24
|
|
|
23
|
|
|
157
|
|
|||
Valvoline
(b)
|
29
|
|
|
44
|
|
|
40
|
|
|||
Unallocated and other
|
3
|
|
|
4
|
|
|
4
|
|
|||
|
$
|
65
|
|
|
$
|
81
|
|
|
$
|
213
|
|
Depreciation and amortization
|
|
|
|
|
|
|
|
|
|||
Specialty Ingredients
|
$
|
244
|
|
|
$
|
262
|
|
|
$
|
242
|
|
Performance Materials
|
59
|
|
|
91
|
|
|
75
|
|
|||
Valvoline
|
38
|
|
|
37
|
|
|
35
|
|
|||
Unallocated and other
|
—
|
|
|
3
|
|
|
4
|
|
|||
|
$
|
341
|
|
|
$
|
393
|
|
|
$
|
356
|
|
Property, plant and equipment - net
|
|
|
|
|
|
|
|
|
|||
Specialty Ingredients
|
$
|
1,383
|
|
|
$
|
1,433
|
|
|
$
|
1,445
|
|
Performance Materials
|
358
|
|
|
508
|
|
|
551
|
|
|||
Valvoline
|
253
|
|
|
272
|
|
|
270
|
|
|||
Unallocated and other
|
188
|
|
|
201
|
|
|
241
|
|
|||
|
$
|
2,182
|
|
|
$
|
2,414
|
|
|
$
|
2,507
|
|
Additions to property, plant and equipment
|
|
|
|
|
|
|
|
|
|||
Specialty Ingredients
|
$
|
171
|
|
|
$
|
159
|
|
|
$
|
144
|
|
Performance Materials
|
33
|
|
|
38
|
|
|
43
|
|
|||
Valvoline
|
45
|
|
|
36
|
|
|
41
|
|
|||
Unallocated and other
|
16
|
|
|
15
|
|
|
36
|
|
|||
|
$
|
265
|
|
|
$
|
248
|
|
|
$
|
264
|
|
|
|
|
|
|
|
(a)
|
ASK joint venture sold during 2014.
|
(b)
|
Venezuela joint venture sold during 2015.
|
Quarters ended
|
December 31
|
|
March 31
|
|
June 30
|
|
September 30
|
||||||||||||||||||||||||
(In millions except per share data)
|
2014
|
|
2013
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
2015
(a)
|
|
|
2014
(b)
|
|
||||||||||||||
Sales
|
$
|
1,391
|
|
|
$
|
1,432
|
|
|
$
|
1,350
|
|
|
$
|
1,545
|
|
|
$
|
1,367
|
|
|
$
|
1,605
|
|
|
$
|
1,280
|
|
|
$
|
1,538
|
|
Cost of sales
|
982
|
|
|
1,048
|
|
|
925
|
|
|
1,168
|
|
|
939
|
|
|
1,161
|
|
|
970
|
|
|
1,227
|
|
||||||||
Gross profit as a percentage of sales
|
29.4
|
%
|
|
26.8
|
%
|
|
31.5
|
%
|
|
24.4
|
%
|
|
31.3
|
%
|
|
27.7
|
%
|
|
24.2
|
%
|
|
20.2
|
%
|
||||||||
Operating income (loss)
|
169
|
|
|
143
|
|
|
193
|
|
|
(64
|
)
|
|
196
|
|
|
143
|
|
|
(101
|
)
|
|
(175
|
)
|
||||||||
Income (loss) from continuing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
operations
|
40
|
|
|
88
|
|
|
95
|
|
|
(61
|
)
|
|
115
|
|
|
71
|
|
|
(59
|
)
|
|
(26
|
)
|
||||||||
Net income (loss)
|
32
|
|
|
110
|
|
|
224
|
|
|
(44
|
)
|
|
107
|
|
|
99
|
|
|
(55
|
)
|
|
68
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Basic earnings per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Continuing operations
|
$
|
0.58
|
|
|
$
|
1.14
|
|
|
$
|
1.40
|
|
|
$
|
(0.78
|
)
|
|
$
|
1.70
|
|
|
$
|
0.91
|
|
|
$
|
(0.88
|
)
|
|
$
|
(0.35
|
)
|
Net income (loss)
|
0.47
|
|
|
1.42
|
|
|
3.30
|
|
|
(0.57
|
)
|
|
1.58
|
|
|
1.27
|
|
|
(0.82
|
)
|
|
0.93
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Diluted earnings per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Continuing operations
|
$
|
0.57
|
|
|
$
|
1.12
|
|
|
$
|
1.39
|
|
|
$
|
(0.78
|
)
|
|
$
|
1.68
|
|
|
$
|
0.90
|
|
|
$
|
(0.88
|
)
|
|
$
|
(0.35
|
)
|
Net income (loss)
|
0.46
|
|
|
1.40
|
|
|
3.26
|
|
|
(0.57
|
)
|
|
1.56
|
|
|
1.25
|
|
|
(0.82
|
)
|
|
0.93
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Regular cash dividends per share
|
$
|
0.34
|
|
|
$
|
0.34
|
|
|
$
|
0.34
|
|
|
$
|
0.34
|
|
|
$
|
0.39
|
|
|
$
|
0.34
|
|
|
$
|
0.39
|
|
|
$
|
0.34
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Market price per common share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
High
|
$
|
121.35
|
|
|
$
|
97.68
|
|
|
$
|
130.66
|
|
|
$
|
100.87
|
|
|
$
|
132.38
|
|
|
$
|
108.93
|
|
|
$
|
123.60
|
|
|
$
|
110.02
|
|
Low
|
95.21
|
|
|
84.43
|
|
|
115.66
|
|
|
88.76
|
|
|
121.83
|
|
|
93.62
|
|
|
97.58
|
|
|
98.55
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Fourth quarter results for 2015 include a decrease in operating income of $246 million related to the loss on pension and postretirement benefit plan remeasurement ($97 million in cost of sales and $149 million in selling, general and administrative expenses), a decrease of $13 million for a customer claim, a decrease of $11 million related to the impairment on IPR&D assets associated with the ISP acquisition, a decrease of $6 million related to restructuring and a decrease of $3 million for an environmental reserve adjustment. Income tax benefit for the fourth quarter included $6 million of discrete tax income items.
|
(b)
|
Fourth quarter results for 2014 include a decrease in operating income of $317 million related to the loss on pension and postretirement benefit plan remeasurement ($97 million in cost of sales and $220 million in selling, general and administrative expenses), a decrease of $29 million related to restructuring and plant closure costs, a decrease of $5 million for foreign legal reserves and a decrease of $4 million related to the impairment on IPR&D assets associated with the ISP acquisition. Income tax benefit for the fourth quarter included $100 million of discrete tax income items including a $168 million reversal of a deferred tax liability related to an assertion change of the nature of unremitted earnings of foreign subsidiaries.
|
Ashland Inc. and Consolidated Subsidiaries
|
|
|
|
|
|
|
|
|
|
||||||||||
Five-Year Selected Financial Information
|
|
|
|
|
|
|
|
|
|
||||||||||
Years Ended September 30
|
|
|
|
|
|
|
|
|
|
||||||||||
(In millions except per share data)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|
2011
|
|
|||||
Summary of operations
|
|
|
|
|
|
|
|
|
|
||||||||||
Sales
|
$
|
5,387
|
|
|
$
|
6,121
|
|
|
$
|
6,091
|
|
|
$
|
6,472
|
|
|
$
|
4,600
|
|
Cost of sales
|
3,814
|
|
|
4,605
|
|
|
4,304
|
|
|
4,813
|
|
|
3,563
|
|
|||||
Gross profit
|
1,573
|
|
|
1,516
|
|
|
1,787
|
|
|
1,659
|
|
|
1,037
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Selling, general and administrative expense
|
1,028
|
|
|
1,358
|
|
|
670
|
|
|
1,327
|
|
|
980
|
|
|||||
Research and development expense
|
110
|
|
|
114
|
|
|
142
|
|
|
104
|
|
|
49
|
|
|||||
Equity and other income
|
23
|
|
|
2
|
|
|
64
|
|
|
53
|
|
|
45
|
|
|||||
Operating income
|
458
|
|
|
46
|
|
|
1,039
|
|
|
281
|
|
|
53
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net interest and other financing expense
|
174
|
|
|
166
|
|
|
282
|
|
|
317
|
|
|
121
|
|
|||||
Net gain (loss) on divestitures
|
(115
|
)
|
|
4
|
|
|
(8
|
)
|
|
(7
|
)
|
|
2
|
|
|||||
Other expense (income)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Income (loss) from continuing operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
before income taxes
|
169
|
|
|
(116
|
)
|
|
749
|
|
|
(43
|
)
|
|
(67
|
)
|
|||||
Income tax expense (benefit)
|
(22
|
)
|
|
(188
|
)
|
|
196
|
|
|
(57
|
)
|
|
(70
|
)
|
|||||
Income from continuing operations
|
191
|
|
|
72
|
|
|
553
|
|
|
14
|
|
|
3
|
|
|||||
Income from discontinued operations
|
118
|
|
|
161
|
|
|
130
|
|
|
12
|
|
|
411
|
|
|||||
Net income
|
$
|
309
|
|
|
$
|
233
|
|
|
$
|
683
|
|
|
$
|
26
|
|
|
$
|
414
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance sheet information (as of September 30)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current assets
|
$
|
3,248
|
|
|
$
|
3,561
|
|
|
$
|
2,873
|
|
|
$
|
3,209
|
|
|
$
|
3,387
|
|
Current liabilities
|
1,448
|
|
|
1,687
|
|
|
1,727
|
|
|
1,913
|
|
|
1,739
|
|
|||||
Working capital
|
$
|
1,800
|
|
|
$
|
1,874
|
|
|
$
|
1,146
|
|
|
$
|
1,296
|
|
|
$
|
1,648
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
$
|
10,064
|
|
|
$
|
10,920
|
|
|
$
|
12,051
|
|
|
$
|
12,471
|
|
|
$
|
12,893
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term debt
|
$
|
326
|
|
|
$
|
329
|
|
|
$
|
308
|
|
|
$
|
344
|
|
|
$
|
83
|
|
Long-term debt (including current portion and debt
|
|
|
|
|
|
|
|
|
|
||||||||||
issuance cost discounts)
|
3,403
|
|
|
2,920
|
|
|
2,922
|
|
|
3,193
|
|
|
3,676
|
|
|||||
Stockholders’ equity
|
3,037
|
|
|
3,583
|
|
|
4,553
|
|
|
4,029
|
|
|
4,135
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash flow information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash flows from operating activities from
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
continuing operations
|
$
|
89
|
|
|
$
|
580
|
|
|
$
|
653
|
|
|
$
|
189
|
|
|
$
|
50
|
|
Additions to property, plant and equipment
|
265
|
|
|
248
|
|
|
264
|
|
|
242
|
|
|
152
|
|
|||||
Cash dividends
|
98
|
|
|
103
|
|
|
88
|
|
|
63
|
|
|
51
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic earnings per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Income from continuing operations
|
$
|
2.81
|
|
|
$
|
0.94
|
|
|
$
|
7.06
|
|
|
$
|
0.18
|
|
|
$
|
0.05
|
|
Net income
|
4.54
|
|
|
3.04
|
|
|
8.71
|
|
|
0.33
|
|
|
5.28
|
|
|||||
Diluted earnings per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Income from continuing operations
|
2.78
|
|
|
0.93
|
|
|
6.95
|
|
|
0.17
|
|
|
0.05
|
|
|||||
Net income
|
4.48
|
|
|
3.00
|
|
|
8.57
|
|
|
0.33
|
|
|
5.17
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividends
|
1.46
|
|
|
1.36
|
|
|
1.13
|
|
|
0.80
|
|
|
0.65
|
|
(a)
|
General Release.
In exchange for these special severance benefits offered by Ashland, I completely release all claims I may have at this time against Ashland, its divisions, subsidiaries, insurers and affiliates, their successors and assigns, and their officers, directors or employees (collectively referred to hereafter as “Releasees”). This Release is intended to be a broad release and shall apply to any relief, no matter how denominated, including, but not limited to, claims for future employment, rights or causes of action for wages, backpay, front pay, compensatory damages, punitive damages, or attorneys fees. I also agree that I will not file any such claim and I hereby agree to indemnify and hold Releasees harmless from any such claim. In addition, I agree to waive the right to receive any recovery under any charge or lawsuit filed on my behalf.
|
(b)
|
Extent of Release.
This release includes all claims I may have which relate either to the time of my employment or to my termination, except the claims mentioned in Section 2(c) below. Some of the types of claims that I am releasing, although there also may be others not listed here, are claims under local, state or federal law relating to:
|
1.
|
Discrimination on the basis of sex, race, color, national origin, religion, disability or veteran status;
|
2.
|
Restrictions, if any, upon the rights of Ashland to terminate its employees at will, including (i) violation of public policy, (ii) breach of any express or implied covenant of the employment contract, and (iii) breach of any covenant of good faith and fair dealing;
|
3.
|
Discrimination on the basis of age, including claims under the Age Discrimination in Employment Act (the “ADEA”), which is located at 29 United States Code, Sections 621 through 634;
|
4.
|
Payments, if any, that might otherwise be owed and payable to me pursuant to the Workers’ Adjustment and Retraining Notification (WARN) Act; and
|
5.
|
Civil actions relating to negligence, defamation, invasion of privacy, fraud, misrepresentation, or infliction of emotional or mental distress.
|
(c)
|
Exceptions to Release.
The only claims that this release does not include are claims related to:
|
1.
|
Claims for benefits to which I am entitled under this special severance offer;
|
2.
|
Any applicable worker’s compensation or unemployment compensation laws;
|
3.
|
My rights under the employee benefit plans of the Company that are governed by the Employee Retirement Income Security Act of 1974, as amended (ERISA), in effect as of my Release Date; and
|
4.
|
Any claims that the law states may not be waived.
|
Section 5.
|
RETURN OF COMPANY INFORMATION AND PROPERTY
|
Section 8.
|
EFFECTIVE DATE AND MY RIGHT TO REVOKE GENERAL RELEASE
|
1.
|
Postmarked within the seven (7) day period;
|
2.
|
Properly addressed as noted above; and
|
3.
|
Sent by Certified Mail, Return Receipt Requested.
|
•
|
I have read this General Release and I understand fully its final and binding effect;
|
•
|
The only promises made to me to sign this General Release are those stated herein;
|
•
|
I am signing this General Release voluntarily; and
|
•
|
I have no other claim or expectation of any additional pay or benefits incident to my Employment. The benefits I am receiving for this General Release are in lieu of, and fully satisfy, all monetary amounts, if any, to which I might otherwise be entitled under federal or state statute or common law.
|
1.
|
Your name, social security number, complete mailing address and phone number;
|
2.
|
An itemized receipt for tuition and fees issued by the educational institution; and
|
3.
|
A grade report from the educational institution.
|
(a)
|
General Release.
In exchange for these special severance benefits offered by Ashland, I completely release all claims I may have at this time against Ashland, its divisions, subsidiaries, insurers and affiliates, their successors and assigns, and their officers, directors or employees (collectively referred to hereafter as “Releasees”). This Release is intended to be a broad release and shall apply to any relief, no matter how denominated, including, but not limited to, claims for future employment, rights or causes of action for wages, backpay, front pay, compensatory damages, punitive damages, or attorneys fees. I also agree that I will not file any such claim and I hereby agree to indemnify and hold Releasees harmless from any such claim. In addition, I agree to waive the right to receive any recovery under any charge or lawsuit filed on my behalf.
|
(b)
|
Extent of Release.
This release includes all claims I may have which relate either to the time of my employment or to my termination, except the claims mentioned in Section 2(c) below. Some of the types of claims that I am releasing, although there also may be others not listed here, are claims under local, state or federal law relating to:
|
1.
|
Discrimination on the basis of sex, race, color, national origin, religion, disability or veteran status;
|
2.
|
Restrictions, if any, upon the rights of Ashland to terminate its employees at will, including (i) violation of public policy, (ii) breach of any express or implied covenant of the employment contract, and (iii) breach of any covenant of good faith and fair dealing;
|
3.
|
Discrimination on the basis of age, including claims under the Age Discrimination in Employment Act (the “ADEA”), which is located at 29 United States Code, Sections 621 through 634;
|
4.
|
Payments, if any, that might otherwise be owed and payable to me pursuant to the Workers’ Adjustment and Retraining Notification (WARN) Act; and
|
5.
|
Civil actions relating to negligence, defamation, invasion of privacy, fraud, misrepresentation, or infliction of emotional or mental distress.
|
(c)
|
Exceptions to Release.
The only claims that this release does not include are claims related to:
|
1.
|
Claims for benefits to which I am entitled under this special severance offer;
|
2.
|
Any applicable worker’s compensation or unemployment compensation laws;
|
3.
|
My rights under the employee benefit plans of the Company that are governed by the Employee Retirement Income Security Act of 1974, as amended (ERISA), in effect as of my Release Date; and
|
4.
|
Any claims that the law states may not be waived.
|
Section 5.
|
RETURN OF COMPANY INFORMATION AND PROPERTY
|
Section 8.
|
EFFECTIVE DATE AND MY RIGHT TO REVOKE GENERAL RELEASE
|
1.
|
Postmarked within the seven (7) day period;
|
2.
|
Properly addressed as noted above; and
|
3.
|
Sent by Certified Mail, Return Receipt Requested.
|
•
|
I have read this General Release and I understand fully its final and binding effect;
|
•
|
The only promises made to me to sign this General Release are those stated herein;
|
•
|
I am signing this General Release voluntarily; and
|
•
|
I have no other claim or expectation of any additional pay or benefits incident to my Employment. The benefits I am receiving for this General Release are in lieu of, and fully satisfy, all monetary amounts, if any, to which I might otherwise be entitled under federal or state statute or common law.
|
1.
|
Your name, social security number, complete mailing address and phone number;
|
2.
|
An itemized receipt for tuition and fees issued by the educational institution; and
|
3.
|
A grade report from the educational institution.
|
i)
|
you voluntarily terminate your employment with Ashland or a Successor, except for a termination for Good Reason as defined herein;
|
ii)
|
your employment is terminated by Ashland or a Successor as a result of your refusal to accept employment in a new or different position with Ashland or a Successor, and you do not have Good Reason, as defined herein, to terminate your employment voluntarily;
|
iii)
|
you violate the confidentiality provisions contained herein;
|
iv)
|
Ashland or a Successor terminates your employment for Cause; For the purposes of this Retention, termination for cause will arise if you: (a) substantially fail to perform your duties with Ashland or a Successor, unless such failure is due to your incapacity as a result of physical or mental illness; or (b) you engage in willful misconduct or gross negligence in performing your duties with Ashland or as Successor;
|
v)
|
in the event of your death. Provided, however, that Ashland and/or a Successor will not be relieved of any obligations under any applicable employee benefit plans of Ashland and/or a Successor which arise due to your death.
|
Company
|
|
Jurisdiction of Incorporation
|
565 Corporation
|
|
Delaware, United States
|
ACM Eurasia LLC
|
|
Russia
|
Ash (Gibraltar) One Limited
|
|
Gibraltar
|
Ash (Gibraltar) Two Limited
|
|
Gibraltar
|
ASH GP LLC
|
|
Delaware, United States
|
Ashland (Changzhou) Advanced Chemical Co., Ltd.
|
|
China
|
Ashland (Changzhou) Specialty Chemical Co., Ltd
|
|
China
|
Ashland (China) Holdings Co., Ltd.
|
|
China
|
Ashland (Gibraltar) One Holding, Inc.
|
|
Delaware, United States
|
Ashland (Tianjin) Chemical Co., Ltd.
|
|
China
|
Ashland Branded Finance, Inc.
|
|
Delaware, United States
|
Ashland Canada Corp.
|
|
Nova Scotia, Canada
|
Ashland Canada Holdings B. V.
|
|
Netherlands
|
Ashland Chemical De Mexico S.A. De C.V.
|
|
Mexico
|
Ashland Chemical Hispania, S. L.
|
|
Spain
|
Ashland Chemical Trading (Shanghai) Company Limited
|
|
China
|
Ashland Chemicals (Nanjing) Company Limited
|
|
China
|
Ashland CZ s.r.o.
|
|
Czech Republic
|
Ashland Danmark ApS
|
|
Denmark
|
Ashland Eastern Markets LLC
|
|
Russia
|
Ashland Ethanol, Inc.
|
|
Delaware, United States
|
Ashland Finance Limited
|
|
Bermuda
|
Ashland Finland Oy
|
|
Finland
|
Ashland France SAS
|
|
France
|
Ashland Hercules Water Technologies (Australia) Pty Ltd
|
|
Australia
|
Ashland Holdings B. V.
|
|
Netherlands
|
Ashland India Private Limited
|
|
India
|
Ashland Industries Deutschland GmbH
|
|
Germany
|
Ashland Industries Europe GmbH
|
|
Switzerland
|
Ashland Industries France SAS
|
|
France
|
Ashland Industries Ireland Limited
|
|
Ireland
|
Ashland Industries Italia S.r.l.
|
|
Italy
|
Ashland Industries Nederland B.V.
|
|
Netherlands
|
Ashland Industries UK Limited
|
|
United Kingdom
|
Ashland International Holdings, Inc.
|
|
Delaware, United States
|
Ashland Italia S.r.l.
|
|
Italy
|
Ashland Korea Limited
|
|
Korea
|
Ashland Licensing and Intellectual Property LLC
|
|
Delaware, United States
|
Ashland ME Holdings, Inc.
|
|
Delaware, United States
|
Ashland Mexico Holdings One, LLC
|
|
Delaware, United States
|
Ashland Mexico Holdings Two, LLC
|
|
Delaware, United States
|
Ashland Nederland B.V.
|
|
Netherlands
|
Ashland New Zealand Limited
|
|
New Zealand
|
Company
|
|
Jurisdiction of Incorporation
|
Ashland Nigeria Exploration Unlimited
|
|
Nigeria
|
Ashland Norge AS
|
|
Norway
|
Ashland Oil (Nigeria) Company Unlimited
|
|
Nigeria
|
Ashland Oil, Inc.
|
|
Kentucky, United States
|
Ashland Pacific Pty. Ltd.
|
|
Australia
|
Ashland Participacoes Ltda.
|
|
Brazil
|
Ashland Poland Sp. z o.o.
|
|
Poland
|
Ashland Polímeros do Brasil S.A.
|
|
Brazil
|
Ashland Polyester (Kunshan) Co. Ltd.
|
|
China
|
Ashland Rhine Holdings B.V.
|
|
Netherlands
|
Ashland Rhone Holdings B.V.
|
|
Netherlands
|
Ashland Services B. V.
|
|
Netherlands
|
Ashland Services Mexico, S.A. de C.V.
|
|
Mexico
|
Ashland Singapore Pte. Ltd.
|
|
Singapore
|
Ashland Specialties Austria GmbH
|
|
Austria
|
Ashland Specialties Belgium BVBA
|
|
Belgium
|
Ashland Specialties France S.a.r.l.
|
|
France
|
Ashland Specialties Hispania S.L.
|
|
Spain
|
Ashland Specialties South Africa Proprietary Limited
|
|
South Africa
|
Ashland Specialties Sverige AB
|
|
Sweden
|
Ashland Specialties UK Limited
|
|
United Kingdom
|
Ashland Specialty Ingredients G.P.
|
|
Delaware, United States
|
Ashland Switzerland Holdings GmbH
|
|
Switzerland
|
Ashland Valvoline Chemical (Shanghai) Co., Ltd
|
|
China
|
Ashland-Alaskan, Limited
|
|
Alaska, United States
|
Ashland-Plasticos De Portugal, Lda.
|
|
Portugal
|
AshLux Three, S.á.r.l.
|
|
Luxembourg
|
Ashmont Insurance Company, Inc.
|
|
Vermont, United States
|
AshOne C. V.
|
|
Netherlands
|
Ashprop Two LLC
|
|
Delaware, United States
|
AshTwo C. V.
|
|
Netherlands
|
Belleville Realty Corp.
|
|
Delaware, United States
|
Bluegrass Insurance Company Limited
|
|
Bermuda
|
CLTA LLC
|
|
Delaware, United States
|
Corporacion ISP Andina, C.A.
|
|
Venezuela
|
Curtis Bay Insurance Co. Ltd
|
|
Bermuda
|
CVG Capital III LLC
|
|
Delaware, United States
|
Delta Technologies LLC
|
|
Delaware, United States
|
East Bay Realty Services, Inc.
|
|
Delaware, United States
|
Ever Success Overseas Limited
|
|
British Virgin Islands
|
FRJ, Inc.
|
|
Georgia, United States
|
Funding Corp. I
|
|
Delaware, United States
|
Hercofina
|
|
Delaware, United States
|
Hercules Chemicals South Africa (Proprietary) Limited
|
|
South Africa
|
Hercules China Limited
|
|
Hong Kong
|
Hercules Holding BV BVBA
|
|
Belgium
|
Hercules Holding II Limited
|
|
United Kingdom
|
Hercules Holding Specialty Materials B. V.
|
|
Netherlands
|
Hercules Hydrocarbon Holdings, Inc.
|
|
Delaware, United States
|
Company
|
|
Jurisdiction of Incorporation
|
Hercules Incorporated
|
|
Delaware, United States
|
Hercules International Limited, LLC
|
|
Delaware, United States
|
Hercules Investment ApS
|
|
Denmark
|
Hercules Investments Netherlands B.V.
|
|
Netherlands
|
Hercules Islands Corporation
|
|
American Virgin Islands
|
Hercules Paper Holdings, Inc.
|
|
Delaware, United States
|
Hercules Tianpu Chemicals Company Limited
|
|
China
|
Hercules Trading (Shanghai) Company Limited
|
|
China
|
International Specialty Holdings LLC
|
|
Delaware, United States
|
International Specialty Products (India) Private Limited
|
|
India
|
International Specialty Products Funding Corporation
|
|
Delaware, United States
|
International Specialty Products Inc.
|
|
Delaware, United States
|
ISP (Australasia) Pty. Limited
|
|
Australia
|
ISP (Belgium) International N. V.
|
|
Belgium
|
ISP (Japan) Ltd
|
|
Japan
|
ISP (Korea) Limited
|
|
Korea
|
ISP (Polska) Sp.z o.o.
|
|
Poland
|
ISP (Puerto Rico) Inc.
|
|
Delaware, United States
|
ISP (SINGAPORE) PTE LTD
|
|
Singapore
|
ISP (Thailand) Co., Ltd
|
|
Thailand
|
ISP Alginates Inc.
|
|
Delaware, United States
|
ISP Argentina S.R.L.
|
|
Argentina
|
ISP Asia Pacific Pte. Ltd
|
|
Singapore
|
ISP Bermuda Limited
|
|
Bermuda
|
ISP Biochema Schwaben GmbH
|
|
Germany
|
ISP Canada Corp.
|
|
Nova Scotia, Canada
|
ISP Capital LLC
|
|
Delaware, United States
|
ISP Chemco LLC
|
|
Delaware, United States
|
ISP Chemical Products LLC
|
|
Delaware, United States
|
ISP CHEMICALS (MALAYSIA) SDN.BHD
|
|
Malaysia
|
ISP Chemicals LLC
|
|
Delaware, United States
|
ISP Chile S. A.
|
|
Chile
|
ISP Colombia Ltda.
|
|
Colombia
|
ISP do Brasil Ltda.
|
|
Brazil
|
ISP Environmental Services Inc.
|
|
Delaware, United States
|
ISP France Customer Service SARL
|
|
France
|
ISP France Holding SARL
|
|
France
|
ISP France Marketing SARL
|
|
France
|
ISP Freetown Fine Chemicals Inc.
|
|
Delaware, United States
|
ISP Freight Services N. V.
|
|
Belgium
|
ISP Global Operations (Barbados) Inc.
|
|
Barbados
|
ISP Global Technologies Deutschland Unterstutzungskasse GmbH
|
|
Germany
|
ISP Global Technologies Inc.
|
|
Delaware, United States
|
ISP Global Technologies LLC
|
|
Delaware, United States
|
ISP HC Limited
|
|
Cyprus
|
ISP Holdings (U.K.) Ltd.
|
|
United Kingdom
|
ISP Horhausen GmbH
|
|
Germany
|
ISP Hungary Holdings Limited Liability Company
|
|
Hungary
|
|
|
|
Company
|
|
Jurisdiction of Incorporation
|
ISP Indústria e Comércio de Ingredientes e Especialidades para Alimentos Ltda.
|
|
Brazil
|
ISP International Corp.
|
|
Delaware, United States
|
ISP Investments Inc.
|
|
Delaware, United States
|
ISP Lima LLC
|
|
Delaware, United States
|
ISP Luxembourg Canada S.a.r.l.
|
|
Luxembourg
|
ISP Management Company, Inc.
|
|
Delaware, United States
|
ISP Marl GmbH
|
|
Germany
|
ISP Marl Holdings GmbH
|
|
Germany
|
ISP Microcaps (U.K.) Limited
|
|
United Kingdom
|
ISP Pharma Systems LLC
|
|
Delaware, United States
|
ISP Real Estate Company, Inc.
|
|
Delaware, United States
|
ISP Sales (U.K.) Limited
|
|
Ireland
|
ISP Singapore Holding LLC
|
|
Delaware, United States
|
ISP Technologies Inc.
|
|
Delaware, United States
|
ISP Technologies LLC
|
|
Delaware, United States
|
Jiangmen Ashland Chemicals Company Limited
|
|
China
|
Lubricantes Andinos "Lubrian S. A."
|
|
Ecuador
|
Lubricantes del Peru S.A.
|
|
Peru
|
Lubrival S. A.
|
|
Ecuador
|
Oil Casualty Insurance, Ltd.
|
|
Bermuda
|
Pakistan Gum Industries (Private) Limited
|
|
Pakistan
|
Progiven S.A.S.
|
|
France
|
PT Ashland Asia
|
|
Indonesia
|
PT ISP Chemicals Indonesia
|
|
Indonesia
|
PT. Hercules Chemicals Indonesia
|
|
Indonesia
|
Relocation Properties Management LLC
|
|
Delaware, United States
|
Saudi Industrial Resins Co. Ltd. (Polyester)
|
|
Saudi Arabia
|
Shanghai VC Lubricating Oil Co., Ltd.
|
|
China
|
St Croix Petrochemical Corp
|
|
American Virgin Islands
|
Techwax Limited
|
|
United Kingdom
|
V C Lubricating Oil Co. Ltd.
|
|
Hong Kong
|
Valvoline (Australia) Pty. Limited
|
|
Australia
|
Valvoline (Deutschland) B.V. & Co. KG
|
|
Germany
|
Valvoline (Thailand) Ltd.
|
|
Thailand
|
Valvoline Cummins Argentina S.A.
|
|
Argentina
|
Valvoline Cummins Private Limited
|
|
India
|
Valvoline de Colombia S.A.S.
|
|
Colombia
|
Valvoline Do Brasil Lubrificantes Ltda.
|
|
Brazil
|
Valvoline Instant Oil Change Franchising, Inc.
|
|
Delaware, United States
|
Valvoline International, Inc.
|
|
Delaware, United States
|
VIOC Funding, Inc.
|
|
Delaware, United States
|
WSP LLC
|
|
Delaware, United States
|
|
|
|
|
|
|
|
|
|
|
|
|
1.
|
Registration Statements on Form S-8 (Nos. 333-54766-99 and 333-127348) pertaining to the Amended and Restated Ashland Inc. Incentive Plan,
|
2.
|
Registration Statement on Form S-8 (No. 333-131792) pertaining to the 2006 Ashland Inc. Incentive Plan,
|
3.
|
Registration Statements on Form S-8 (Nos. 333-172019 and 333-186408) pertaining to the Amended and Restated 2011 Ashland Inc. Incentive Plan,
|
4.
|
Registration Statement on Form S-8 (No. 333-201895) pertaining to the Amended and Restated 2015 Ashland Inc. Incentive Plan,
|
5.
|
Registration Statement on Form S-8 (No. 333-201053) pertaining to the Inducement Restricted Stock Award,
|
6.
|
Registration Statement on Form S-8 (No. 33-62091-99) pertaining to the Ashland Inc. Deferred Compensation Plan,
|
7.
|
Registration Statement on Form S-8 (No. 33-52125-99) pertaining to the Ashland Inc. Deferred Compensation Plan for Non-Employee Directors,
|
8.
|
Registration Statement on Form S-8 (No. 333-122269-99) pertaining to the Ashland Inc. Deferred Compensation Plan for Employees (2005),
|
9.
|
Registration Statement on Form S-8 (No. 333-122270-99) pertaining to the Ashland Inc. Deferred Compensation Plan for Non-Employee Directors (2005),
|
10.
|
Registration Statements on Form S-8 (Nos. 33-32612-99, 333-157040 and 333-203840) pertaining to the Ashland Inc. Employee Savings Plan,
|
11.
|
Registration Statement on Form S-8 (No. 33-49907-99) pertaining to the Ashland Inc. Leveraged Employee Stock Ownership Plan,
|
12.
|
Registration Statement on Form S-8 (No. 333-155386) pertaining to the Hercules Incorporated Amended and Restated Long Term Incentive Compensation Plan and the Hercules Incorporated Omnibus Equity Compensation Plan for Non-Employee Directors,
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13.
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Registration Statements on Form S-8 (Nos. 333-155396 and 333-203840) pertaining to the Ashland Inc. Union Employee Savings Plan, and
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14.
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Registration Statements on Form S-8 (Nos. 333-184109 and 333-203840) pertaining to the International Specialty Products Inc. 401(k) Plan,
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/s/ William A. Wulfsohn
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/s/ Barry W. Perry
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William A. Wulfsohn, Chairman of the Board
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Barry W. Perry, Director
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and Chief Executive Officer
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(Principal Executive Officer)
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/s/ J. Kevin Willis
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/s/ Mark C. Rohr
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J. Kevin Willis, Senior Vice President
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Mark C. Rohr, Director
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and Chief Financial Officer
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(Principal Financial Officer)
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/s/ J. William Heitman
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/s/ George A. Schaefer, Jr.
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J. William Heitman, Vice President
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George A. Schaefer, Jr., Director
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and Controller
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(Principal Accounting Officer)
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/s/ Brendan M. Cummins
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/s/ Janice J. Teal
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Brendan M. Cummins, Director
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Janice J. Teal, Director
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/s/ Roger W. Hale
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/s/ Michael J. Ward
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Roger W. Hale, Director
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Michael J. Ward, Director
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/s/ Stephen F. Kirk
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Stephen F. Kirk, Director
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/s/ Vada O. Manager
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Vada O. Manager, Director
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1.
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I have reviewed this annual report on Form 10-K of Ashland Inc.;
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2.
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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;
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3.
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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;
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4.
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The registrant’s other certifying officer 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:
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a.
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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;
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b.
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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;
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c.
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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
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d.
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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
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5.
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The registrant’s other certifying officer 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):
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a.
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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
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b.
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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.
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/s/ William A. Wulfsohn
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William A. Wulfsohn
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Chairman and Chief Executive Officer
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(Principal Executive Officer)
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1.
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I have reviewed this annual report on Form 10-K of Ashland Inc.;
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2.
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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;
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3.
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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;
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4.
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The registrant’s other certifying officer 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:
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a.
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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;
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b.
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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;
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c.
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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
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d.
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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
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5.
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The registrant’s other certifying officer 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):
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a.
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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
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b.
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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.
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/s/ J. Kevin Willis
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J. Kevin Willis
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Chief Financial Officer
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(Principal Financial Officer)
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ William A. Wulfsohn
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William A. Wulfsohn
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Chief Executive Officer
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November 20, 2015
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/s/ J. Kevin Willis
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J. Kevin Willis
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Chief Financial Officer
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November 20, 2015
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