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Delaware
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43-2109021
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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One Owens Corning Parkway, Toledo, OH
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43659
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
þ
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Accelerated filer
¨
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Non-accelerated filer
¨
(Do not check if a smaller reporting company)
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Smaller reporting company
¨
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Emerging growth company
¨
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Contents
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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Item 1A.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Three Months Ended
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|||||
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March 31,
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|||||
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2018
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2017
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||||
NET SALES
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$
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1,691
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$
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1,478
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COST OF SALES
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1,336
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1,136
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Gross margin
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355
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342
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OPERATING EXPENSES
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Marketing and administrative expenses
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185
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142
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Science and technology expenses
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23
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21
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Other expenses, net
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20
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11
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Total operating expenses
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228
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174
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OPERATING INCOME
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127
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168
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Non-operating income
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(4
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)
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(2
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)
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EARNINGS BEFORE INTEREST AND TAXES
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131
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170
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Interest expense, net
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28
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26
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EARNINGS BEFORE TAXES
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103
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144
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Income tax expense
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11
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43
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NET EARNINGS
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92
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101
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Net earnings attributable to noncontrolling interests
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—
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—
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NET EARNINGS ATTRIBUTABLE TO OWENS CORNING
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$
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92
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$
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101
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EARNINGS PER COMMON SHARE ATTRIBUTABLE TO OWENS CORNING COMMON STOCKHOLDERS
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Basic
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$
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0.83
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$
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0.90
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Diluted
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$
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0.82
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$
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0.89
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Dividend
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$
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0.21
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$
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0.20
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WEIGHTED AVERAGE COMMON SHARES
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Basic
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111.5
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112.3
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Diluted
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112.8
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113.5
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Three Months Ended
March 31, |
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2018
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2017
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NET EARNINGS
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$
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92
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$
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101
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Currency translation adjustment (net of tax of $6 and $0 for the three months ended March 31, 2018 and 2017, respectively)
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(15
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)
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36
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Pension and other postretirement adjustment (net of tax of $(2) and $(1) for the three months ended March 31, 2018 and 2017, respectively)
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(2
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)
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—
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Hedging adjustment (net of tax of $0 and $1 for the three months ended March 31, 2018 and 2017, respectively)
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1
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(2
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)
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COMPREHENSIVE EARNINGS
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76
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135
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Comprehensive earnings attributable to noncontrolling interests
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—
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—
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COMPREHENSIVE EARNINGS ATTRIBUTABLE TO OWENS CORNING
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$
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76
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$
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135
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ASSETS
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March 31,
2018 |
December 31,
2017 |
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CURRENT ASSETS
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Cash and cash equivalents
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$
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140
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$
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246
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Receivables, less allowances of $21 at March 31, 2018 and $19 at December 31, 2017
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1,061
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806
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Inventories
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943
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841
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Assets held for sale
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3
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12
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Other current assets
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81
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80
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Total current assets
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2,228
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1,985
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Property, plant and equipment, net
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3,755
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3,425
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Goodwill
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1,962
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1,507
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Intangible assets, net
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1,872
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1,360
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Deferred income taxes
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155
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144
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Other non-current assets
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241
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211
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TOTAL ASSETS
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$
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10,213
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$
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8,632
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LIABILITIES AND EQUITY
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CURRENT LIABILITIES
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Accounts payable and accrued liabilities
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$
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1,379
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$
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1,277
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Short-term debt
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1
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1
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Long-term debt – current portion
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4
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4
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Total current liabilities
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1,384
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1,282
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Long-term debt, net of current portion
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3,762
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2,405
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Pension plan liability
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260
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256
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Other employee benefits liability
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222
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225
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Deferred income taxes
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143
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37
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Other liabilities
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301
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223
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OWENS CORNING STOCKHOLDERS’ EQUITY
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Preferred stock, par value $0.01 per share (a)
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—
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—
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Common stock, par value $0.01 per share (b)
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1
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1
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Additional paid in capital
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3,999
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4,011
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Accumulated earnings
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1,631
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1,575
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Accumulated other comprehensive deficit
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(530
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)
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(514
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)
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Cost of common stock in treasury (c)
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(1,003
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)
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(911
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)
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Total Owens Corning stockholders’ equity
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4,098
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4,162
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Noncontrolling interests
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43
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42
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Total equity
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4,141
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4,204
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TOTAL LIABILITIES AND EQUITY
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$
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10,213
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$
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8,632
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(a)
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10 shares authorized; none issued or outstanding at
March 31, 2018
and
December 31, 2017
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(b)
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400 shares authorized;
135.5
issued and
111.0
outstanding at
March 31, 2018
;
135.5
issued and
111.5
outstanding at
December 31, 2017
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(c)
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24.5
shares at
March 31, 2018
, and
24.0
shares at
December 31, 2017
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Three Months Ended
March 31, |
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2018
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2017
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||||
NET CASH FLOW (USED FOR) PROVIDED BY OPERATING ACTIVITIES
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Net earnings
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$
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92
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$
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101
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Adjustments to reconcile net earnings to cash (used for) provided by operating activities:
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Depreciation and amortization
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109
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84
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Deferred income taxes
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1
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27
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Provision for pension and other employee benefits liabilities
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—
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2
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Stock-based compensation expense
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9
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10
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Other non-cash
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(1
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)
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6
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Changes in operating assets and liabilities
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(284
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)
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(204
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)
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Pension fund contributions
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(6
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)
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(6
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)
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Payments for other employee benefits liabilities
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(6
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)
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(8
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)
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Other
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(4
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)
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(5
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)
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Net cash flow (used for) provided by operating activities
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(90
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)
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7
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NET CASH FLOW USED FOR INVESTING ACTIVITIES
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Cash paid for property, plant and equipment
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(101
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)
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(67
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)
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Proceeds from the sale of assets or affiliates
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14
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—
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|
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Investment in subsidiaries and affiliates, net of cash acquired
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(1,121
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)
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—
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Other
|
1
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—
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Net cash flow used for investing activities
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(1,207
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)
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(67
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)
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NET CASH FLOW PROVIDED BY FINANCING ACTIVITIES
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Proceeds from long-term debt
|
389
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|
—
|
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Proceeds from senior revolving credit and receivables securitization facilities
|
565
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|
194
|
|
||
Proceeds from term loan borrowing
|
600
|
|
—
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|
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Payments on senior revolving credit and receivables securitization facilities
|
(197
|
)
|
(37
|
)
|
||
Dividends paid
|
(46
|
)
|
(45
|
)
|
||
Purchases of treasury stock
|
(111
|
)
|
(72
|
)
|
||
Other
|
1
|
|
3
|
|
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Net cash flow provided by financing activities
|
1,201
|
|
43
|
|
||
Effect of exchange rate changes on cash
|
(10
|
)
|
6
|
|
||
Net decrease in cash, cash equivalents and restricted cash
|
(106
|
)
|
(11
|
)
|
||
Cash, cash equivalents and restricted cash at beginning of period
|
253
|
|
118
|
|
||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD
|
$
|
147
|
|
$
|
107
|
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Standard
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Description
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Effective Date for Company
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Effect on the
Consolidated Financial Statements
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Recently adopted standards:
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ASU 2014-09 "Revenue from Contracts with Customers (Topic 606)," as amended by ASU's 2015-14, 2016-08, 2016-10, 2016-11, 2016-12, 2016-20, 2017-05 and 2017-13 and 2017-14.
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This standard outlines a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. Entities can adopt this standard either through a retrospective or modified-retrospective approach.
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January 1, 2018
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The adoption of this standard did not have a material impact on our Consolidated Financial Statements. Please refer to Note 3 of the Consolidated Financial Statements for transition disclosures, as well as other ongoing disclosure requirements.
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ASU 2016-16 "Income Taxes (Topic 740)"
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This standard requires that an entity recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs.
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January 1, 2018
|
The adoption of this standard did not have a material impact on our Consolidated Financial Statements. Please refer to Note 16 for a detailed explanation of the cumulative effect of adoption recognized on January 1, 2018.
|
ASU 2017-07 "Compensation - Retirement Benefits (Topic 715)"
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This standard requires that the other components of net benefit cost be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. Entities will adopt the presentation elements of this standard on a retrospective basis.
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January 1, 2018
|
The adoption of this standard did not have a material effect on our Consolidated Financial Statements for the three months ended March 31, 2018. The standard's retrospective adoption, though, will result in a full-year $60 million reclassification of non-service costs from various financial statement lines to non-operating expense when the remaining periods of 2017 are presented again in future filings, primarily related to pension settlement losses that were recorded in the second and fourth quarters of 2017 (as described in Note 13 of our 2017 Form 10-K). Please refer to Note 12 of the Consolidated Financial Statements for additional detail on this adoption.
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ASU 2017-12 "Derivatives and Hedging (Topic 815)"
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This standard changes how an entity assesses effectiveness of derivative instruments, potentially resulting in less ineffectiveness and more derivatives qualifying for hedge accounting. Entities may early adopt the standard in any interim period, with the effect of adoption being applied to existing hedging relationships as of the beginning of the fiscal year of adoption.
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January 1, 2018
|
The early-adoption of this standard did not have a material impact on our Consolidated Financial Statements. Please refer to Note 5 of the Consolidated Financial Statements for additional detail on this adoption.
|
Recently issued standards:
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ASU 2016-02 "Leases (Topic 842)," as amended by ASU 2017-13 and 2018-01, and potentially subject to change through the "Targeted Improvements" Proposed ASU exposure draft released on January 5, 2018.
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The standard requires lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. The recognition and presentation of expenses will depend on classification as a finance or operating lease. Entities will adopt this standard through a retrospective approach, the extent to which will be affected by the proposed ASU draft.
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January 1, 2019
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We are currently assessing the potential impact of this standard adoption on our financial reporting processes and disclosures. We believe that our adoption of the standard will likely have a material impact to our Consolidated Balance Sheets for the recognition of certain operating leases as right-of-use assets and lease liabilities. (Our operating lease obligations are described in Note 8 of our 2017 Form 10-K.) We are in the process of analyzing our lease portfolio and implementing systems to comply with the standard's retrospective adoption requirements.
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ASU 2016-13 "Financial Instruments - Credit Losses (Topic 326)"
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This standard replaces the incurred loss methodology for recognizing credit losses with a current expected credit losses model and applies to all financial assets, including trade receivables. Entities will adopt the standard using a modified-retrospective approach.
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January 1, 2020
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We are currently assessing the impact this standard will have on our Consolidated Financial Statements. Our current accounts receivable policy (as described in Note 1 of our 2017 Form 10-K) uses historical and current information to estimate the amount of probable credit losses in our existing accounts receivable. We have not yet analyzed our current systems and methods to determine the impact of using forward-looking information to estimate expected credit losses.
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Three Months Ended
March 31, |
|||||
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2018
|
2017
|
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Reportable Segments
|
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|
||||
Composites
|
$
|
511
|
|
$
|
511
|
|
Insulation
|
596
|
|
399
|
|
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Roofing
|
642
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|
627
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Total reportable segments
|
1,749
|
|
1,537
|
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Corporate eliminations
|
(58
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)
|
(59
|
)
|
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NET SALES
|
$
|
1,691
|
|
$
|
1,478
|
|
|
Three Months Ended
March 31, |
|||||
|
2018
|
2017
|
||||
Reportable Segments
|
|
|
||||
Composites
|
$
|
60
|
|
$
|
71
|
|
Insulation
|
32
|
|
5
|
|
||
Roofing
|
97
|
|
125
|
|
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Total reportable segments
|
189
|
|
201
|
|
||
Restructuring costs
|
(5
|
)
|
—
|
|
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Acquisition-related costs
|
(14
|
)
|
(1
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)
|
||
Recognition of acquisition inventory fair value step-up
|
(2
|
)
|
—
|
|
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General corporate expense and other
|
(37
|
)
|
(30
|
)
|
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Total Corporate, other and eliminations
|
(58
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)
|
(31
|
)
|
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EBIT
|
$
|
131
|
|
$
|
170
|
|
|
For the three months ended March 31, 2018
|
||||||||||||||
Reportable Segments
|
Composites
|
Insulation
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Roofing
|
Eliminations
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Consolidated
|
||||||||||
Disaggregation Categories
|
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||||||||||
U.S. residential
|
$
|
76
|
|
$
|
222
|
|
$
|
559
|
|
$
|
(53
|
)
|
$
|
804
|
|
U.S. commercial and industrial
|
139
|
|
147
|
|
39
|
|
(1
|
)
|
324
|
|
|||||
Europe
|
157
|
|
119
|
|
3
|
|
—
|
|
279
|
|
|||||
Asia-Pacific
|
106
|
|
33
|
|
3
|
|
—
|
|
142
|
|
|||||
Rest of World
|
33
|
|
75
|
|
38
|
|
(4
|
)
|
142
|
|
|||||
NET SALES
|
$
|
511
|
|
$
|
596
|
|
$
|
642
|
|
$
|
(58
|
)
|
$
|
1,691
|
|
|
March 31, 2018
|
December 31, 2017
|
||||
Finished goods
|
$
|
630
|
|
$
|
562
|
|
Materials and supplies
|
313
|
|
279
|
|
||
Total inventories
|
$
|
943
|
|
$
|
841
|
|
|
|
|
Fair Value at
|
||||||
|
Location
|
|
March 31, 2018
|
|
December 31, 2017
|
||||
Derivative assets designated as hedging instruments:
|
|
|
|
|
|
||||
Net investment hedges:
|
|
|
|
|
|
||||
Cross-currency swaps
|
Other current assets
|
|
$
|
8
|
|
|
$
|
7
|
|
Cash flow hedges:
|
|
|
|
|
|
||||
Natural gas forward swaps
|
Other current assets
|
|
$
|
1
|
|
|
$
|
1
|
|
Foreign exchange forward contracts
|
Other current assets
|
|
$
|
1
|
|
|
$
|
—
|
|
Derivative liabilities designated as hedging instruments:
|
|
|
|
|
|
||||
Net investment hedges:
|
|
|
|
|
|
||||
Cross-currency swaps
|
Other liabilities
|
|
$
|
63
|
|
|
$
|
38
|
|
Cash flow hedges:
|
|
|
|
|
|
||||
Natural gas forward swaps
|
Accounts payable and
accrued liabilities
|
|
$
|
—
|
|
|
$
|
1
|
|
Derivative assets not designated as hedging instruments:
|
|
|
|
|
|
||||
Foreign exchange forward contracts
|
Other current assets
|
|
$
|
4
|
|
|
$
|
1
|
|
Derivative liabilities not designated as hedging instruments:
|
|
|
|
|
|
||||
Foreign exchange forward contracts
|
Accounts payable and
accrued liabilities
|
|
$
|
1
|
|
|
$
|
1
|
|
|
|
Three Months Ended
March 31, |
|||||
|
Location
|
2018
|
2017
|
||||
Derivative activity designated as hedging instruments:
|
|
|
|
||||
Natural gas cash flow hedges:
|
|
|
|
||||
Amount of gain reclassified from AOCI (as defined below) into earnings
|
Cost of sales
|
$
|
—
|
|
$
|
(1
|
)
|
Cross-currency swap net investment hedges:
|
|
|
|
||||
Amount of gain recognized in earnings on derivative amounts excluded from effectiveness testing
|
Interest expense, net
|
$
|
(3
|
)
|
$
|
—
|
|
Derivative activity not designated as hedging instruments:
|
|
|
|
||||
Foreign currency:
|
|
|
|
||||
Amount of gain recognized in earnings (a)
|
Other expenses, net
|
$
|
(4
|
)
|
$
|
—
|
|
(a)
|
Gains related to foreign currency derivatives were substantially offset by net revaluation impacts on foreign currency denominated balance sheet exposures, which were also recorded in
Other expenses, net
.
|
|
|
Three Months Ended March 31, 2018
|
||
Hedging Type
|
Derivative Financial Instrument
|
Amount of Gain (Loss) Recognized in Comprehensive Earnings
|
||
Net investment hedge
|
Cross-currency swaps
|
$
|
(25
|
)
|
Cash flow hedge
|
Natural gas forward swaps
|
$
|
1
|
|
March 31, 2018
|
Weighted
Average
Useful Life
|
|
Gross
Carrying
Amount
|
Accumulated
Amortization
|
Net Carrying
Amount
|
||||||
Amortizable intangible assets:
|
|
|
|
|
|
||||||
Customer relationships
|
20
|
|
$
|
588
|
|
$
|
(116
|
)
|
$
|
472
|
|
Technology
|
17
|
|
328
|
|
(120
|
)
|
208
|
|
|||
Other
|
14
|
|
61
|
|
(27
|
)
|
34
|
|
|||
Indefinite-lived intangible assets:
|
|
|
|
|
|
||||||
Trademarks
|
|
|
1,158
|
|
—
|
|
1,158
|
|
|||
Total intangible assets
|
|
|
$
|
2,135
|
|
$
|
(263
|
)
|
$
|
1,872
|
|
Goodwill
|
|
|
$
|
1,962
|
|
|
|
December 31, 2017
|
Weighted
Average
Useful Life
|
|
Gross
Carrying
Amount
|
Accumulated
Amortization
|
Net Carrying
Amount
|
||||||
Amortizable intangible assets:
|
|
|
|
|
|
||||||
Customer relationships
|
20
|
|
$
|
363
|
|
$
|
(109
|
)
|
$
|
254
|
|
Technology
|
18
|
|
255
|
|
(116
|
)
|
139
|
|
|||
Other
|
8
|
|
47
|
|
(26
|
)
|
21
|
|
|||
Indefinite-lived intangible assets:
|
|
|
|
|
|
||||||
Trademarks
|
|
|
946
|
|
—
|
|
946
|
|
|||
Total intangible assets
|
|
|
$
|
1,611
|
|
$
|
(251
|
)
|
$
|
1,360
|
|
Goodwill
|
|
|
$
|
1,507
|
|
|
|
|
Composites
|
|
Insulation
|
|
Roofing
|
|
Total
|
||||||||
Balance at December 31, 2017
|
$
|
58
|
|
|
$
|
1,049
|
|
|
$
|
400
|
|
|
$
|
1,507
|
|
Acquisitions (see Note 8)
|
—
|
|
|
452
|
|
|
—
|
|
|
452
|
|
||||
Foreign currency translation
|
—
|
|
|
2
|
|
|
1
|
|
|
3
|
|
||||
Balance at March 31, 2018
|
$
|
58
|
|
|
$
|
1,503
|
|
|
$
|
401
|
|
|
$
|
1,962
|
|
|
Customer Relationships
|
|
Technology
|
|
Trademarks
|
|
Other
|
|
Total
|
||||||||||
Balance at December 31, 2017
|
$
|
363
|
|
|
$
|
255
|
|
|
$
|
946
|
|
|
$
|
47
|
|
|
$
|
1,611
|
|
Acquisitions (see Note 8)
|
225
|
|
|
73
|
|
|
213
|
|
|
7
|
|
|
518
|
|
|||||
Other additions, net
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
|
|||||
Foreign currency translation
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||
Balance at March 31, 2018
|
$
|
588
|
|
|
$
|
328
|
|
|
$
|
1,158
|
|
|
$
|
61
|
|
|
$
|
2,135
|
|
Period
|
Amortization (a)
|
||
2019
|
$
|
53
|
|
2020
|
$
|
53
|
|
2021
|
$
|
52
|
|
2022
|
$
|
48
|
|
2023
|
$
|
45
|
|
(a)
|
The yearly amortization amounts in the table above include approximately
$26 million
of aggregate amortization expense related to the preliminary purchase price allocations of the acquisitions of Pittsburgh Corning Corporation and Pittsburgh Corning Europe NV (collectively, "Pittsburgh Corning") and Paroc. See
Note 8
for more details of these acquisitions.
|
|
March 31,
2018 |
December 31, 2017
|
||||
Land
|
$
|
277
|
|
$
|
251
|
|
Buildings and leasehold improvements
|
1,023
|
|
944
|
|
||
Machinery and equipment
|
4,460
|
|
4,211
|
|
||
Construction in progress
|
402
|
|
350
|
|
||
|
6,162
|
|
5,756
|
|
||
Accumulated depreciation
|
(2,407
|
)
|
(2,331
|
)
|
||
Property, plant and equipment, net
|
$
|
3,755
|
|
$
|
3,425
|
|
8.
|
ACQUISITIONS (continued)
|
Type of Intangible Asset
|
Preliminary Fair Value
|
Weighted Average Useful Life
|
||
Customer relationships
|
$
|
225
|
|
20
|
Technology - Know-how
|
63
|
|
15
|
|
Technology - Patented
|
10
|
|
5
|
|
Quarry Rights
|
7
|
|
45
|
|
Trademarks
|
213
|
|
Indefinite
|
|
Total
|
$
|
518
|
|
|
Type of Intangible Asset
|
Preliminary Fair Value
|
Weighted Average Useful Life
|
||
Customer relationships
|
$
|
107
|
|
19
|
Technology
|
37
|
|
15
|
|
Trademarks
|
101
|
|
Indefinite
|
|
Total
|
$
|
245
|
|
|
8.
|
ACQUISITIONS (continued)
|
|
Three Months Ended March 31, 2018
|
||
Beginning balance
|
$
|
55
|
|
Amounts accrued for current year
|
5
|
|
|
Settlements of warranty claims
|
(2
|
)
|
|
Ending balance
|
$
|
58
|
|
Location
|
Paroc Acquisition
|
Pittsburgh Corning Acquisition
|
Total
|
||||||
Marketing and administrative expenses
|
$
|
4
|
|
$
|
1
|
|
$
|
5
|
|
Other expenses, net
|
9
|
|
—
|
|
9
|
|
|||
Total acquisition-related costs
|
$
|
13
|
|
$
|
1
|
|
$
|
14
|
|
10.
|
RESTRUCTURING AND ACQUISITION-RELATED COSTS (continued)
|
|
|
Three Months Ended March 31,
|
|||||
Type of cost
|
Location
|
2018
|
2017
|
||||
Accelerated depreciation
|
Cost of sales
|
$
|
5
|
|
$
|
—
|
|
Other exit costs
|
Cost of sales
|
2
|
|
—
|
|
||
Severance
|
Other expenses, net
|
1
|
|
—
|
|
||
Other exit gains
|
Other expenses, net
|
(3
|
)
|
—
|
|
||
Total restructuring costs
|
|
$
|
5
|
|
$
|
—
|
|
|
2017 Cost Reduction Actions
|
Pittsburgh Corning Acquisition-Related Restructuring
|
Total
|
||||||
Balance at December 31, 2017
|
$
|
11
|
|
$
|
9
|
|
$
|
20
|
|
Restructuring costs
|
4
|
|
1
|
|
5
|
|
|||
Payments
|
(2
|
)
|
(2
|
)
|
(4
|
)
|
|||
Non-cash items and reclassifications to other accounts
|
(1
|
)
|
(1
|
)
|
(2
|
)
|
|||
Balance at March 31, 2018
|
$
|
12
|
|
$
|
7
|
|
$
|
19
|
|
Cumulative charges incurred
|
$
|
33
|
|
$
|
18
|
|
$
|
51
|
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||
|
Carrying Value
|
Fair Value
|
|
Carrying Value
|
Fair Value
|
||||||
4.20% senior notes, net of discount and financing fees, due 2022
|
$
|
597
|
|
103
|
%
|
|
$
|
597
|
|
105
|
%
|
4.20% senior notes, net of discount and financing fees, due 2024
|
392
|
|
102
|
%
|
|
392
|
|
105
|
%
|
||
3.40% senior notes, net of discount and financing fees, due 2026
|
395
|
|
96
|
%
|
|
395
|
|
98
|
%
|
||
7.00% senior notes, net of discount and financing fees, due 2036
|
400
|
|
127
|
%
|
|
400
|
|
132
|
%
|
||
4.30% senior notes, net of discount and financing fees, due 2047
|
588
|
|
92
|
%
|
|
588
|
|
99
|
%
|
||
4.40% senior notes, net of discount and financing fees, due 2048
|
389
|
|
92
|
%
|
|
—
|
|
n/a
|
|
||
Senior revolving credit facility, maturing in 2020 (a)
|
121
|
|
100
|
%
|
|
—
|
|
n/a
|
|
||
Receivables securitization facility, maturing in 2020 (a)
|
247
|
|
100
|
%
|
|
—
|
|
n/a
|
|
||
Various capital leases, due through and beyond 2050 (a)
|
31
|
|
100
|
%
|
|
31
|
|
100
|
%
|
||
Term loan borrowing, maturing in 2021 (a)
|
600
|
|
100
|
%
|
|
—
|
|
n/a
|
|
||
Unamortized interest rate swap basis adjustment
|
6
|
|
n/a
|
|
|
6
|
|
n/a
|
|
||
Total long-term debt
|
3,766
|
|
n/a
|
|
|
2,409
|
|
n/a
|
|
||
Less – current portion (a)
|
4
|
|
100
|
%
|
|
4
|
|
100
|
%
|
||
Long-term debt, net of current portion
|
$
|
3,762
|
|
n/a
|
|
|
$
|
2,405
|
|
n/a
|
|
11.
|
DEBT (continued)
|
11.
|
DEBT (continued)
|
|
Balance at March 31, 2018
|
||||||||
|
Term Loan Borrowing
|
Senior Revolving Credit Facility
|
Receivables Securitization Facility
|
||||||
Facility size or borrowing limit
|
$
|
600
|
|
$
|
800
|
|
$
|
250
|
|
Collateral capacity limitation on availability
|
n/a
|
n/a
|
—
|
|
|||||
Outstanding borrowings
|
600
|
|
121
|
|
247
|
|
|||
Outstanding letters of credit
|
n/a
|
9
|
|
3
|
|
||||
Availability on facility
|
$
|
—
|
|
$
|
670
|
|
$
|
—
|
|
12.
|
PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS
|
|
Three Months Ended March 31, 2017
|
||||||||
Location
|
Before Adoption
|
Adoption Impact
|
After Adoption
|
||||||
Cost of sales
|
$
|
1,135
|
|
$
|
1
|
|
$
|
1,136
|
|
Other expenses, net
|
$
|
10
|
|
$
|
1
|
|
$
|
11
|
|
Non-operating income
|
$
|
—
|
|
$
|
(2
|
)
|
$
|
(2
|
)
|
|
Three Months Ended March 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
||||||||||||||||
|
U.S.
|
Non-U.S.
|
Total
|
|
U.S.
|
Non-U.S.
|
Total
|
||||||||||||
Components of Net Periodic Pension Cost
|
|
|
|
|
|
|
|
||||||||||||
Service cost
|
$
|
2
|
|
$
|
1
|
|
$
|
3
|
|
|
$
|
2
|
|
$
|
1
|
|
$
|
3
|
|
Interest cost
|
9
|
|
3
|
|
12
|
|
|
10
|
|
4
|
|
14
|
|
||||||
Expected return on plan assets
|
(14
|
)
|
(5
|
)
|
(19
|
)
|
|
(14
|
)
|
(6
|
)
|
(20
|
)
|
||||||
Amortization of actuarial loss
|
3
|
|
1
|
|
4
|
|
|
3
|
|
1
|
|
4
|
|
||||||
Net periodic pension cost
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
|
$
|
1
|
|
$
|
—
|
|
$
|
1
|
|
12.
|
PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS (continued)
|
|
Three Months Ended
March 31, |
|||||
|
2018
|
2017
|
||||
Components of Net Periodic Benefit Cost
|
|
|
||||
Service cost
|
$
|
1
|
|
$
|
1
|
|
Interest cost
|
2
|
|
2
|
|
||
Amortization of prior service cost
|
(1
|
)
|
(1
|
)
|
||
Amortization of actuarial loss
|
(2
|
)
|
(1
|
)
|
||
Net periodic benefit cost
|
$
|
—
|
|
$
|
1
|
|
13.
|
CONTINGENT LIABILITIES AND OTHER MATTERS
|
13.
|
CONTINGENT LIABILITIES AND OTHER MATTERS (continued)
|
14.
|
STOCK COMPENSATION
|
|
Options Outstanding
|
Options Exercisable
|
||||||||||
|
Options
Outstanding
|
Weighted-Average
|
Number Exercisable at March 31, 2018
|
Weighted-Average
|
||||||||
Range of Exercise Prices
|
Remaining
Contractual Life
|
Exercise
Price
|
Remaining
Contractual Life
|
Exercise
Price
|
||||||||
$13.89 - $42.16
|
491,625
|
|
4.69
|
$
|
37.23
|
|
491,625
|
|
4.69
|
$
|
37.23
|
|
14.
|
STOCK COMPENSATION (continued)
|
14.
|
STOCK COMPENSATION (continued)
|
|
Three Months Ended
March 31, 2018 |
||||
|
Number
of PSUs
|
Weighted-Average
Grant-Date
Fair Value
|
|||
Beginning Balance
|
451,148
|
|
$
|
53.96
|
|
Granted
|
171,725
|
|
93.25
|
|
|
Forfeited
|
(3,672
|
)
|
49.52
|
|
|
Ending Balance
|
619,201
|
|
$
|
64.88
|
|
|
Three Months Ended
March 31, |
|||||
|
2018
|
2017
|
||||
Net earnings attributable to Owens Corning
|
$
|
92
|
|
$
|
101
|
|
Weighted-average number of shares outstanding used for basic earnings per share
|
111.5
|
|
112.3
|
|
||
Non-vested restricted and performance shares
|
1.0
|
|
0.9
|
|
||
Options to purchase common stock
|
0.3
|
|
0.3
|
|
||
Weighted-average number of shares outstanding and common equivalent shares used for diluted earnings per share
|
112.8
|
|
113.5
|
|
||
Earnings per common share attributable to Owens Corning common stockholders:
|
|
|
||||
Basic
|
$
|
0.83
|
|
$
|
0.90
|
|
Diluted
|
$
|
0.82
|
|
$
|
0.89
|
|
|
Three Months Ended March 31,
|
|||||
|
2018
|
2017
|
||||
Income tax expense
|
$
|
11
|
|
$
|
43
|
|
Effective tax rate
|
11
|
%
|
30
|
%
|
|
Three Months Ended
|
|||||
|
March 31,
|
|||||
|
2018
|
2017
|
||||
Currency Translation Adjustment
|
|
|
||||
Beginning balance
|
$
|
(183
|
)
|
$
|
(284
|
)
|
Net investment hedge amounts classified into AOCI, net of tax
|
(19
|
)
|
—
|
|
||
Gain on foreign currency translation
|
4
|
|
36
|
|
||
Other comprehensive (loss)/income, net of tax
|
(15
|
)
|
36
|
|
||
Ending balance
|
$
|
(198
|
)
|
$
|
(248
|
)
|
Pension and Other Postretirement Adjustment
|
|
|
||||
Beginning balance
|
$
|
(331
|
)
|
$
|
(429
|
)
|
Amounts reclassified from AOCI to net earnings, net of tax (a)
|
1
|
|
1
|
|
||
Amounts classified into AOCI, net of tax
|
(3
|
)
|
(1
|
)
|
||
Other comprehensive income, net of tax
|
(2
|
)
|
—
|
|
||
Ending balance
|
$
|
(333
|
)
|
$
|
(429
|
)
|
Hedging Adjustment
|
|
|
||||
Beginning balance
|
$
|
—
|
|
$
|
3
|
|
Amounts reclassified from AOCI to net earnings, net of tax (b)
|
—
|
|
(1
|
)
|
||
Amounts classified into AOCI, net of tax
|
1
|
|
(1
|
)
|
||
Other comprehensive income/(loss), net of tax
|
1
|
|
(2
|
)
|
||
Ending balance
|
$
|
1
|
|
$
|
1
|
|
Total AOCI ending balance
|
$
|
(530
|
)
|
$
|
(676
|
)
|
(a)
|
These AOCI components are included in the computation of total Pension and OPEB expense and are recorded in Non-operating income. See
Note 12
for additional information.
|
(b)
|
Amounts reclassified from gain/(loss) on cash flow hedges are reclassified from AOCI to income when the hedged item affects earnings and are recognized in Cost of sales. See
Note 5
for additional information.
|
|
Parent
|
Guarantor
Subsidiaries
|
Non-Guarantor
Subsidiaries
|
Eliminations
|
Consolidated
|
||||||||||
NET SALES
|
$
|
—
|
|
$
|
1,172
|
|
$
|
659
|
|
$
|
(140
|
)
|
$
|
1,691
|
|
COST OF SALES
|
2
|
|
960
|
|
514
|
|
(140
|
)
|
1,336
|
|
|||||
Gross margin
|
(2
|
)
|
212
|
|
145
|
|
—
|
|
355
|
|
|||||
OPERATING EXPENSES
|
|
|
|
|
|
||||||||||
Marketing and administrative expenses
|
41
|
|
86
|
|
58
|
|
—
|
|
185
|
|
|||||
Science and technology expenses
|
—
|
|
19
|
|
4
|
|
—
|
|
23
|
|
|||||
Other expenses, net
|
4
|
|
9
|
|
7
|
|
—
|
|
20
|
|
|||||
Total operating expenses
|
45
|
|
114
|
|
69
|
|
—
|
|
228
|
|
|||||
OPERATING INCOME
|
(47
|
)
|
98
|
|
76
|
|
—
|
|
127
|
|
|||||
Non-operating income
|
(2
|
)
|
(1
|
)
|
(1
|
)
|
—
|
|
(4
|
)
|
|||||
EARNINGS BEFORE INTEREST AND TAXES
|
(45
|
)
|
99
|
|
77
|
|
—
|
|
131
|
|
|||||
Interest expense, net
|
20
|
|
(1
|
)
|
9
|
|
—
|
|
28
|
|
|||||
EARNINGS BEFORE TAXES
|
(65
|
)
|
100
|
|
68
|
|
—
|
|
103
|
|
|||||
Income tax expense
|
(30
|
)
|
25
|
|
16
|
|
—
|
|
11
|
|
|||||
Equity in net earnings of subsidiaries
|
127
|
|
52
|
|
—
|
|
(179
|
)
|
—
|
|
|||||
Equity in net earnings of affiliates
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
NET EARNINGS
|
92
|
|
127
|
|
52
|
|
(179
|
)
|
92
|
|
|||||
Net earnings attributable to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
NET EARNINGS ATTRIBUTABLE TO OWENS CORNING
|
$
|
92
|
|
$
|
127
|
|
$
|
52
|
|
$
|
(179
|
)
|
$
|
92
|
|
|
Parent
|
Guarantor
Subsidiaries
|
Non-Guarantor
Subsidiaries
|
Eliminations
|
Consolidated
|
||||||||||
NET SALES
|
$
|
—
|
|
$
|
1,094
|
|
$
|
511
|
|
$
|
(127
|
)
|
$
|
1,478
|
|
COST OF SALES
|
1
|
|
867
|
|
395
|
|
(127
|
)
|
1,136
|
|
|||||
Gross margin
|
(1
|
)
|
227
|
|
116
|
|
—
|
|
342
|
|
|||||
OPERATING EXPENSES
|
|
|
|
|
|
||||||||||
Marketing and administrative expenses
|
36
|
|
77
|
|
29
|
|
—
|
|
142
|
|
|||||
Science and technology expenses
|
—
|
|
17
|
|
4
|
|
—
|
|
21
|
|
|||||
Other expenses, net
|
(2
|
)
|
10
|
|
3
|
|
—
|
|
11
|
|
|||||
Total operating expenses
|
34
|
|
104
|
|
36
|
|
—
|
|
174
|
|
|||||
OPERATING INCOME
|
(35
|
)
|
123
|
|
80
|
|
—
|
|
168
|
|
|||||
Non-operating income
|
—
|
|
(2
|
)
|
—
|
|
—
|
|
(2
|
)
|
|||||
EARNINGS BEFORE INTEREST AND TAXES
|
(35
|
)
|
125
|
|
80
|
|
—
|
|
170
|
|
|||||
Interest expense, net
|
23
|
|
—
|
|
3
|
|
—
|
|
26
|
|
|||||
EARNINGS BEFORE TAXES
|
(58
|
)
|
125
|
|
77
|
|
—
|
|
144
|
|
|||||
Income tax expense
|
(28
|
)
|
50
|
|
21
|
|
—
|
|
43
|
|
|||||
Equity in net earnings of subsidiaries
|
131
|
|
56
|
|
—
|
|
(187
|
)
|
—
|
|
|||||
Equity in net earnings of affiliates
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
NET EARNINGS
|
101
|
|
131
|
|
56
|
|
(187
|
)
|
101
|
|
|||||
Net earnings attributable to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
NET EARNINGS ATTRIBUTABLE TO OWENS CORNING
|
$
|
101
|
|
$
|
131
|
|
$
|
56
|
|
$
|
(187
|
)
|
$
|
101
|
|
|
Parent
|
Guarantor
Subsidiaries
|
Non-Guarantor
Subsidiaries
|
Eliminations
|
Consolidated
|
||||||||||
NET EARNINGS
|
$
|
101
|
|
$
|
131
|
|
$
|
56
|
|
$
|
(187
|
)
|
$
|
101
|
|
Currency translation adjustment (net of tax)
|
36
|
|
1
|
|
36
|
|
(37
|
)
|
36
|
|
|||||
Pension and other postretirement adjustment (net of tax)
|
—
|
|
(1
|
)
|
(2
|
)
|
3
|
|
—
|
|
|||||
Hedging adjustment (net of tax)
|
(2
|
)
|
—
|
|
—
|
|
—
|
|
(2
|
)
|
|||||
COMPREHENSIVE EARNINGS
|
135
|
|
131
|
|
90
|
|
(221
|
)
|
135
|
|
|||||
Comprehensive earnings attributable to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
COMPREHENSIVE EARNINGS ATTRIBUTABLE TO OWENS CORNING
|
$
|
135
|
|
$
|
131
|
|
$
|
90
|
|
$
|
(221
|
)
|
$
|
135
|
|
ASSETS
|
Parent
|
Guarantor
Subsidiaries
|
Non-
Guarantor
Subsidiaries
|
Eliminations
|
Consolidated
|
||||||||||
CURRENT ASSETS
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
$
|
11
|
|
$
|
129
|
|
$
|
—
|
|
$
|
140
|
|
Receivables, net
|
—
|
|
—
|
|
1,061
|
|
—
|
|
1,061
|
|
|||||
Due from affiliates
|
—
|
|
3,089
|
|
—
|
|
(3,089
|
)
|
—
|
|
|||||
Inventories
|
—
|
|
501
|
|
442
|
|
—
|
|
943
|
|
|||||
Other current assets
|
24
|
|
27
|
|
33
|
|
—
|
|
84
|
|
|||||
Total current assets
|
24
|
|
3,628
|
|
1,665
|
|
(3,089
|
)
|
2,228
|
|
|||||
Investment in subsidiaries
|
8,891
|
|
2,095
|
|
—
|
|
(10,986
|
)
|
—
|
|
|||||
Property, plant and equipment, net
|
466
|
|
1,687
|
|
1,602
|
|
—
|
|
3,755
|
|
|||||
Goodwill and intangible assets, net
|
—
|
|
2,376
|
|
1,522
|
|
(64
|
)
|
3,834
|
|
|||||
Other non-current assets
|
(22
|
)
|
222
|
|
196
|
|
—
|
|
396
|
|
|||||
TOTAL ASSETS
|
$
|
9,359
|
|
$
|
10,008
|
|
$
|
4,985
|
|
$
|
(14,139
|
)
|
$
|
10,213
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
||||||||||
CURRENT LIABILITIES
|
|
|
|
|
|
||||||||||
Accounts and notes payable and other current liabilities
|
$
|
89
|
|
$
|
726
|
|
$
|
569
|
|
$
|
—
|
|
$
|
1,384
|
|
Due to affiliates
|
1,445
|
|
—
|
|
1,644
|
|
(3,089
|
)
|
—
|
|
|||||
Total current liabilities
|
1,534
|
|
726
|
|
2,213
|
|
(3,089
|
)
|
1,384
|
|
|||||
Long-term debt, net of current portion
|
3,489
|
|
10
|
|
263
|
|
—
|
|
3,762
|
|
|||||
Deferred income taxes
|
—
|
|
—
|
|
143
|
|
—
|
|
143
|
|
|||||
Other liabilities
|
238
|
|
381
|
|
228
|
|
(64
|
)
|
783
|
|
|||||
OWENS CORNING STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
||||||||||
Total Owens Corning stockholders’ equity
|
4,098
|
|
8,891
|
|
2,095
|
|
(10,986
|
)
|
4,098
|
|
|||||
Noncontrolling interests
|
—
|
|
—
|
|
43
|
|
—
|
|
43
|
|
|||||
Total equity
|
4,098
|
|
8,891
|
|
2,138
|
|
(10,986
|
)
|
4,141
|
|
|||||
TOTAL LIABILITIES AND EQUITY
|
$
|
9,359
|
|
$
|
10,008
|
|
$
|
4,985
|
|
$
|
(14,139
|
)
|
$
|
10,213
|
|
ASSETS
|
Parent
|
Guarantor
Subsidiaries |
Non-
Guarantor Subsidiaries |
Eliminations
|
Consolidated
|
||||||||||
CURRENT ASSETS
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
137
|
|
$
|
2
|
|
$
|
107
|
|
$
|
—
|
|
$
|
246
|
|
Receivables, net
|
—
|
|
—
|
|
806
|
|
—
|
|
806
|
|
|||||
Due from affiliates
|
—
|
|
3,403
|
|
—
|
|
(3,403
|
)
|
—
|
|
|||||
Inventories
|
—
|
|
475
|
|
366
|
|
—
|
|
841
|
|
|||||
Other current assets
|
22
|
|
28
|
|
42
|
|
—
|
|
92
|
|
|||||
Total current assets
|
159
|
|
3,908
|
|
1,321
|
|
(3,403
|
)
|
1,985
|
|
|||||
Investment in subsidiaries
|
8,777
|
|
2,040
|
|
—
|
|
(10,817
|
)
|
—
|
|
|||||
Property, plant and equipment, net
|
465
|
|
1,699
|
|
1,261
|
|
—
|
|
3,425
|
|
|||||
Goodwill and intangible assets, net
|
—
|
|
2,383
|
|
553
|
|
(69
|
)
|
2,867
|
|
|||||
Other non-current assets
|
(24
|
)
|
221
|
|
158
|
|
—
|
|
355
|
|
|||||
TOTAL ASSETS
|
$
|
9,377
|
|
$
|
10,251
|
|
$
|
3,293
|
|
$
|
(14,289
|
)
|
$
|
8,632
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
||||||||||
CURRENT LIABILITIES
|
|
|
|
|
|
||||||||||
Accounts and notes payable and other current liabilities
|
$
|
87
|
|
$
|
1,083
|
|
$
|
112
|
|
$
|
—
|
|
$
|
1,282
|
|
Due to affiliates
|
2,529
|
|
—
|
|
874
|
|
(3,403
|
)
|
—
|
|
|||||
Total current liabilities
|
2,616
|
|
1,083
|
|
986
|
|
(3,403
|
)
|
1,282
|
|
|||||
Long-term debt, net of current portion
|
2,378
|
|
10
|
|
17
|
|
—
|
|
2,405
|
|
|||||
Deferred income taxes
|
—
|
|
—
|
|
37
|
|
—
|
|
37
|
|
|||||
Other liabilities
|
221
|
|
381
|
|
171
|
|
(69
|
)
|
704
|
|
|||||
OWENS CORNING STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|||||||||
Total Owens Corning stockholders’ equity
|
4,162
|
|
8,777
|
|
2,040
|
|
(10,817
|
)
|
4,162
|
|
|||||
Noncontrolling interests
|
—
|
|
—
|
|
42
|
|
—
|
|
42
|
|
|||||
Total equity
|
4,162
|
|
8,777
|
|
2,082
|
|
(10,817
|
)
|
4,204
|
|
|||||
TOTAL LIABILITIES AND EQUITY
|
$
|
9,377
|
|
$
|
10,251
|
|
$
|
3,293
|
|
$
|
(14,289
|
)
|
$
|
8,632
|
|
|
Parent
|
Guarantor
Subsidiaries
|
Non-
Guarantor
Subsidiaries
|
Eliminations
|
Consolidated
|
||||||||||
NET CASH FLOW (USED FOR) PROVIDED BY OPERATING ACTIVITIES
|
$
|
(22
|
)
|
$
|
(123
|
)
|
$
|
55
|
|
$
|
—
|
|
$
|
(90
|
)
|
NET CASH FLOW USED FOR INVESTING ACTIVITIES
|
|
|
|
|
|
||||||||||
Cash paid for property, plant and equipment
|
(1
|
)
|
(59
|
)
|
(41
|
)
|
—
|
|
(101
|
)
|
|||||
Proceeds from the sale of assets or affiliates
|
—
|
|
—
|
|
14
|
|
—
|
|
14
|
|
|||||
Investment in subsidiaries and affiliates, net of cash acquired
|
—
|
|
—
|
|
(1,121
|
)
|
—
|
|
(1,121
|
)
|
|||||
Other
|
1
|
|
—
|
|
—
|
|
—
|
|
1
|
|
|||||
Net cash flow used for investing activities
|
—
|
|
(59
|
)
|
(1,148
|
)
|
—
|
|
(1,207
|
)
|
|||||
NET CASH FLOW PROVIDED BY FINANCING ACTIVITIES
|
|
|
|
|
|
||||||||||
Proceeds from long-term debt
|
389
|
|
—
|
|
—
|
|
—
|
|
389
|
|
|||||
Proceeds from senior revolving credit and receivables securitization facilities
|
276
|
|
—
|
|
289
|
|
—
|
|
565
|
|
|||||
Proceeds from term loan borrowing
|
600
|
|
—
|
|
—
|
|
—
|
|
600
|
|
|||||
Payments on senior revolving credit and receivables securitization facilities
|
(155
|
)
|
—
|
|
(42
|
)
|
—
|
|
(197
|
)
|
|||||
Dividends paid
|
(46
|
)
|
—
|
|
—
|
|
—
|
|
(46
|
)
|
|||||
Purchases of treasury stock
|
(111
|
)
|
—
|
|
—
|
|
—
|
|
(111
|
)
|
|||||
Other intercompany loans
|
(1,068
|
)
|
191
|
|
877
|
|
—
|
|
—
|
|
|||||
Other
|
1
|
|
—
|
|
—
|
|
—
|
|
1
|
|
|||||
Net cash flow provided by financing activities
|
(114
|
)
|
191
|
|
1,124
|
|
—
|
|
1,201
|
|
|||||
Effect of exchange rate changes on cash
|
—
|
|
—
|
|
(10
|
)
|
—
|
|
(10
|
)
|
|||||
Net decrease in cash, cash equivalents and restricted cash
|
(136
|
)
|
9
|
|
21
|
|
—
|
|
(106
|
)
|
|||||
Cash, cash equivalents and restricted cash at beginning of period
|
143
|
|
2
|
|
108
|
|
—
|
|
253
|
|
|||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD
|
$
|
7
|
|
$
|
11
|
|
$
|
129
|
|
$
|
—
|
|
$
|
147
|
|
|
Parent
|
Guarantor
Subsidiaries
|
Non-
Guarantor
Subsidiaries
|
Eliminations
|
Consolidated
|
||||||||||
NET CASH FLOW (USED FOR) PROVIDED BY OPERATING ACTIVITIES
|
$
|
(8
|
)
|
$
|
(52
|
)
|
$
|
67
|
|
$
|
—
|
|
$
|
7
|
|
NET CASH FLOW USED FOR INVESTING ACTIVITIES
|
|
|
|
|
|
||||||||||
Cash paid for property, plant and equipment
|
—
|
|
(52
|
)
|
(15
|
)
|
—
|
|
(67
|
)
|
|||||
Investment in subsidiaries and affiliates, net of cash acquired
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Other
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Net cash flow used for investing activities
|
—
|
|
(52
|
)
|
(15
|
)
|
—
|
|
(67
|
)
|
|||||
NET CASH FLOW PROVIDED BY FINANCING ACTIVITIES
|
|
|
|
|
|
||||||||||
Proceeds from senior revolving credit and receivables securitization facilities
|
—
|
|
—
|
|
194
|
|
—
|
|
194
|
|
|||||
Payments on senior revolving credit and receivables securitization facilities
|
—
|
|
—
|
|
(37
|
)
|
—
|
|
(37
|
)
|
|||||
Dividends paid
|
(45
|
)
|
—
|
|
—
|
|
—
|
|
(45
|
)
|
|||||
Purchases of treasury stock
|
(72
|
)
|
—
|
|
—
|
|
—
|
|
(72
|
)
|
|||||
Other intercompany loans
|
122
|
|
50
|
|
(172
|
)
|
—
|
|
—
|
|
|||||
Other
|
3
|
|
—
|
|
—
|
|
—
|
|
3
|
|
|||||
Net cash flow provided by financing activities
|
8
|
|
50
|
|
(15
|
)
|
—
|
|
43
|
|
|||||
Effect of exchange rate changes on cash
|
—
|
|
—
|
|
6
|
|
—
|
|
6
|
|
|||||
Net decrease in cash, cash equivalents and restricted cash
|
—
|
|
(54
|
)
|
43
|
|
—
|
|
(11
|
)
|
|||||
Cash, cash equivalents and restricted cash at beginning of period
|
6
|
|
55
|
|
57
|
|
—
|
|
118
|
|
|||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD
|
$
|
6
|
|
$
|
1
|
|
$
|
100
|
|
$
|
—
|
|
$
|
107
|
|
|
Three Months Ended
March 31, |
|||||
|
2018
|
2017
|
||||
Net sales
|
$
|
1,691
|
|
$
|
1,478
|
|
Gross margin
|
$
|
355
|
|
$
|
342
|
|
% of net sales
|
21
|
%
|
23
|
%
|
||
Marketing and administrative expenses
|
$
|
185
|
|
$
|
142
|
|
Earnings before interest and taxes
|
$
|
131
|
|
$
|
170
|
|
Interest expense, net
|
$
|
28
|
|
$
|
26
|
|
Income tax expense
|
$
|
11
|
|
$
|
43
|
|
Net earnings attributable to Owens Corning
|
$
|
92
|
|
$
|
101
|
|
|
|
Three Months Ended March 31,
|
|||||
|
Location
|
2018
|
2017
|
||||
Restructuring costs
|
Cost of sales
|
$
|
(7
|
)
|
$
|
—
|
|
Restructuring costs
|
Other expenses, net
|
2
|
|
—
|
|
||
Acquisition-related costs
|
Marketing and administrative expenses
|
(5
|
)
|
(1
|
)
|
||
Acquisition-related costs
|
Other expenses, net
|
(9
|
)
|
—
|
|
||
Recognition of acquisition inventory fair value step-up
|
Cost of sales
|
(2
|
)
|
—
|
|
||
Total restructuring, acquisition and integration-related costs
|
|
$
|
(21
|
)
|
$
|
(1
|
)
|
|
Three Months Ended
March 31, |
|||||
|
2018
|
2017
|
||||
Restructuring costs
|
$
|
(5
|
)
|
$
|
—
|
|
Acquisition-related costs
|
(14
|
)
|
(1
|
)
|
||
Recognition of acquisition inventory fair value step-up
|
(2
|
)
|
—
|
|
||
Total adjusting items
|
$
|
(21
|
)
|
$
|
(1
|
)
|
|
Three Months Ended
March 31, |
|||||
|
2018
|
2017
|
||||
NET EARNINGS ATTRIBUTABLE TO OWENS CORNING
|
$
|
92
|
|
$
|
101
|
|
Net earnings attributable to noncontrolling interests
|
—
|
|
—
|
|
||
NET EARNINGS
|
92
|
|
101
|
|
||
Income tax expense
|
11
|
|
43
|
|
||
EARNINGS BEFORE TAXES
|
103
|
|
144
|
|
||
Interest expense, net
|
28
|
|
26
|
|
||
EARNINGS BEFORE INTEREST AND TAXES
|
131
|
|
170
|
|
||
Adjusting items from above
|
(21
|
)
|
(1
|
)
|
||
ADJUSTED EBIT
|
$
|
152
|
|
$
|
171
|
|
|
Three Months Ended
March 31, |
|||||
|
2018
|
2017
|
||||
Net sales
|
$
|
511
|
|
$
|
511
|
|
% change from prior year
|
—
|
%
|
8
|
%
|
||
EBIT
|
$
|
60
|
|
$
|
71
|
|
EBIT as a % of net sales
|
12
|
%
|
14
|
%
|
||
Depreciation and amortization expense
|
$
|
37
|
|
$
|
36
|
|
|
Three Months Ended
March 31, |
|||||
|
2018
|
2017
|
||||
Net sales
|
$
|
596
|
|
$
|
399
|
|
% change from prior year
|
49
|
%
|
4
|
%
|
||
EBIT
|
$
|
32
|
|
$
|
5
|
|
EBIT as a % of net sales
|
5
|
%
|
1
|
%
|
||
Depreciation and amortization expense
|
$
|
45
|
|
$
|
26
|
|
|
Three Months Ended
March 31, |
|||||
|
2018
|
2017
|
||||
Net sales
|
$
|
642
|
|
$
|
627
|
|
% change from prior year
|
2
|
%
|
46
|
%
|
||
EBIT
|
$
|
97
|
|
$
|
125
|
|
EBIT as a % of net sales
|
15
|
%
|
20
|
%
|
||
Depreciation and amortization expense
|
$
|
12
|
|
$
|
12
|
|
|
Three Months Ended
March 31, |
|||||
|
2018
|
2017
|
||||
Restructuring costs
|
$
|
(5
|
)
|
$
|
—
|
|
Acquisition-related costs
|
(14
|
)
|
(1
|
)
|
||
Recognition of acquisition inventory fair value step-up
|
(2
|
)
|
—
|
|
||
General corporate expense and other
|
(37
|
)
|
(30
|
)
|
||
EBIT
|
$
|
(58
|
)
|
$
|
(31
|
)
|
Depreciation and amortization
|
$
|
15
|
|
$
|
10
|
|
|
As of March 31, 2018
|
||||||||
|
Term Loan Borrowing
|
Senior Revolving Credit Facility
|
Receivables Securitization Facility
|
||||||
Facility size or borrowing limit
|
$
|
600
|
|
$
|
800
|
|
$
|
250
|
|
Collateral capacity limitation on availability
|
n/a
|
n/a
|
—
|
|
|||||
Outstanding borrowings
|
600
|
|
121
|
|
247
|
|
|||
Outstanding letters of credit
|
n/a
|
9
|
|
3
|
|
||||
Availability on facility
|
$
|
—
|
|
$
|
670
|
|
$
|
—
|
|
|
Three Months Ended
March 31, |
|||||
|
2018
|
2017
|
||||
Cash and cash equivalents
|
$
|
140
|
|
$
|
101
|
|
Net cash flow (used for) provided by operating activities
|
$
|
(90
|
)
|
$
|
7
|
|
Net cash flow used for investing activities
|
$
|
(1,207
|
)
|
$
|
(67
|
)
|
Net cash flow provided by financing activities
|
$
|
1,201
|
|
$
|
43
|
|
Availability on the Senior Revolving Credit Facility
|
$
|
670
|
|
$
|
791
|
|
Availability on the Receivables Securitization Facility
|
$
|
—
|
|
$
|
90
|
|
•
|
relationships with key customers;
|
•
|
levels of residential and commercial construction activity;
|
•
|
competitive and pricing factors;
|
•
|
levels of global industrial production;
|
•
|
demand for our products;
|
•
|
industry and economic conditions that affect the market and operating conditions of our customers, suppliers or lenders;
|
•
|
domestic and international economic and political conditions, policies or other governmental actions, legislation and related regulations or interpretations, in the United States or elsewhere;
|
•
|
foreign exchange and commodity price fluctuations;
|
•
|
our level of indebtedness;
|
•
|
weather conditions;
|
•
|
availability and cost of credit;
|
•
|
availability and cost of energy and raw materials;
|
•
|
issues involving implementation and protection of information technology systems;
|
•
|
labor disputes;
|
•
|
legal and regulatory proceedings, including litigation and environmental actions;
|
•
|
our ability to utilize our net operating loss carryforwards;
|
•
|
research and development activities and intellectual property protection;
|
•
|
interest rate movements;
|
•
|
uninsured losses;
|
•
|
issues related to acquisitions, divestitures and joint ventures;
|
•
|
achievement of expected synergies, cost reductions and/or productivity improvements;
|
•
|
defined benefit plan funding obligations; and
|
•
|
price volatility in certain wind energy markets in the U.S.
|
Period
|
Total Number of
Shares (or
Units)
Purchased
|
|
Average
Price Paid
per Share
(or Unit)
|
Total Number of
Shares (or
Units)
Purchased as
Part of Publicly
Announced
Plans or
Programs**
|
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs**
|
|||||
January 1-31, 2018
|
102,917
|
|
|
$
|
93.91
|
|
99,900
|
|
7,394,076
|
|
February 1-28, 2018
|
528,565
|
|
|
88.73
|
|
179,900
|
|
7,214,176
|
|
|
March 1-31, 2018
|
723,381
|
|
|
80.66
|
|
722,900
|
|
6,491,276
|
|
|
Total
|
1,354,863
|
|
*
|
$
|
84.81
|
|
1,002,700
|
|
6,491,276
|
|
*
|
The Company retained an aggregate of
352,163
shares surrendered to satisfy tax withholding obligations in connection with the vesting of restricted shares granted to our employees.
|
**
|
On October 24, 2016, the Board of Directors approved a share buy-back program under which the Company is authorized to repurchase up to
10 million shares
of the Company’s outstanding common stock (the “Repurchase Authorization”). The Repurchase Authorization enables the Company to repurchase shares through the open market, privately negotiated, or other transactions. The actual number of shares repurchased will depend on timing, market conditions and other factors and is at the Company’s discretion. The Company repurchased
1.0 million
shares of its common stock for
$83 million
during the
three months ended
March 31, 2018
under the Repurchase Authorization. As of
March 31, 2018
,
6.5 million shares
remain available for repurchase under the Repurchase Authorization.
|
Name
|
Votes For
|
Votes Against
|
Abstentions
|
Broker Non-Votes
|
||||
Cesar Conde
|
90,255,895
|
|
472,157
|
|
34,407
|
|
7,174,949
|
|
Adrienne D. Elsner
|
90,264,115
|
|
461,800
|
|
36,544
|
|
7,174,949
|
|
J. Brian Ferguson
|
90,187,858
|
|
550,001
|
|
24,600
|
|
7,174,949
|
|
Ralph F. Hake
|
89,102,493
|
|
1,629,883
|
|
30,083
|
|
7,174,949
|
|
Edward F. Lonergan
|
90,103,330
|
|
628,707
|
|
30,422
|
|
7,174,949
|
|
Maryann T. Mannen
|
90,289,395
|
|
444,106
|
|
28,958
|
|
7,174,949
|
|
W. Howard Morris
|
89,736,582
|
|
994,139
|
|
31,738
|
|
7,174,949
|
|
Suzanne P. Nimocks
|
89,489,483
|
|
1,245,319
|
|
27,657
|
|
7,174,949
|
|
Michael H. Thaman
|
86,443,353
|
|
3,767,469
|
|
551,637
|
|
7,174,949
|
|
John D. Williams
|
89,751,169
|
|
980,207
|
|
31,083
|
|
7,174,949
|
|
Votes For
|
Votes Against
|
Abstentions
|
Broker Non-Votes
|
||||
95,509,554
|
|
2,357,371
|
|
70,483
|
|
—
|
|
Votes For
|
Votes Against
|
Abstentions
|
Broker Non-Votes
|
||||
84,325,854
|
|
6,310,772
|
|
125,833
|
|
7,174,949
|
|
Exhibit
Number
|
Description
|
2.1
|
|
|
|
4.1
|
|
|
|
4.2
|
|
|
|
10.1
|
|
|
|
10.2
|
|
|
|
10.3
|
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
32.1
|
|
|
|
32.2
|
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
|
|
|
|
OWENS CORNING
|
|
|
|
|
|
|
|
|
|
|
|
Registrant
|
|
|
|
|
|
|
Date:
|
|
April 25, 2018
|
By:
|
|
/s/ Michael C. McMurray
|
|
|
|
|
|
Michael C. McMurray
|
|
|
|
|
|
Senior Vice President and
|
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
Date:
|
|
April 25, 2018
|
By:
|
|
/s/ Kelly J. Schmidt
|
|
|
|
|
|
Kelly J. Schmidt
|
|
|
|
|
|
Vice President and
|
|
|
|
|
|
Controller
|
DATED
|
2018
|
(1)
|
PARRY INVESTMENTS S.A.
|
(2)
|
THE WARRANTORS (AS DEFINED HEREIN)
|
(3)
|
OWENS CORNING FINLAND OY
|
(4)
|
PAROC GROUP OYJ
|
(5)
|
PARRY 1 HOLDING AB
|
(6)
|
PROJECT PARRY JERSEY LIMITED
|
(7)
|
PAROC OY AB
|
(1)
|
PARRY INVESTMENTS S.A.
, a limited liability company, incorporated under the laws of Luxembourg and having its registered office at 20 Avenue Monterey, L/2163 Luxembourg and registered under number B194.003 (the "
Seller
");
|
(2)
|
The persons whose names are set out in Schedule A of the SPA (the "
Warrantors
"); and
|
(3)
|
OWENS CORNING FINLAND OY
, a limited liability company incorporated and existing under the laws of Finland and having its registered office at c/o Asianajotoimisto Borenius Oy, Etelaesplanadi 2, 00130 Helsinki, Finland and registered under number 2745767-6 (the "
Buyer
"),
|
(4)
|
PAROC GROUP OYJ
, a public limited company incorporated and existing under the laws of Finland and having its registered office at PL 240 00181 Helsinki, Finland and registered under number 2302501-6 ("
Paroc Group
");
|
(5)
|
PARRY 1 HOLDING AB
,
a limited liability company incorporated under the laws of Sweden and having its registered office at 541 86, Skövde, Sweden and registered under number 556985-1305 (the "
Company
");
|
(6)
|
PROJECT PARRY JERSEY LIMITED
, a company incorporated under the laws of Jersey and registered under number 117679 ("
Parry Jersey
"); and
|
(7)
|
PAROC OY AB
, a private limited liability company incorporated and existing under the laws of Finland and having its registered office at PL 240 00180 Helsinki, Finland and registered under number 2580556-9 ("
Paroc Oy AB
").
|
(A)
|
On 27 October 2017, the SPA Parties entered into a share sale and purchase agreement (the "
SPA
") for the sale and purchase of the entire issued share capital of the Company.
|
(B)
|
In accordance with Section 14.8 of the SPA, the SPA Parties wish to amend the SPA and the SPA Parties and the Parties wish to record their agreement on certain matters in relation to the SPA on the terms of this Agreement.
|
1.
|
Interpretation
|
1.1
|
Except where specified otherwise or where the context otherwise requires, terms defined in the SPA bear the same meaning in this Agreement and the provisions of Section 1 of the SPA shall apply on an equivalent basis to this Agreement.
|
1.2
|
As used in this Agreement the following capitalised terms have the following meaning:
|
2.
|
Amendment of SPA
|
(A)
|
The wording of the definition of 'Closing Date' at Section 1.19 of the SPA shall be deleted in its entirety and replaced with the following wording:
|
(B)
|
The wording of the definition of 'Existing Debt Facilities' at Section 1.42 of the SPA shall be deleted in its entirety and replaced with the following wording:
|
(C)
|
A new defined term of "Factoring Agreements" shall be added as a new Section 1.44A of the SPA which shall be defined as follows:
|
(D)
|
The wording of the definition of 'Release Documents' at Section 1.90 of the SPA shall be deleted in its entirety and replaced with the following wording:
|
(E)
|
The following sub-paragraph shall be added as a new Section 5.1(b)(vii) of the SPA:
|
(F)
|
The wording of Section 5.3(b)(i) of the SPA shall be deleted in its entirety and replaced with the following wording:
|
(G)
|
The wording of Section 5.3(f)(iv) of the SPA shall be deleted in its entirety and replaced with the following wording:
|
(H)
|
The wording of Section 7.1(d) of the SPA shall be deleted in its entirety and replaced with the following wording:
|
(I)
|
The wording of Section 14.1(iii) of the SPA shall be deleted in its entirety and replaced with the following wording:
|
3.
|
Other agreements in respect of certain seller's obligations
|
(A)
|
Seller confirms that:
|
a.
|
none of Paroc Polska Sp. z o.o., AS Paroc, SIA Paroc and UAB Paroc has issued share certificates; and
|
b.
|
the share certificate issued by Paroc Group represents only issued share numbers 1 - 2,500 in Paroc Group and therefore does not represent all of the issued shares in Paroc Group (the interests being held in the Group Companies referred to in sub-clause 3.1 (A)a above and the uncertificated interests representing share numbers 2,501 - 47,500,000 in Paroc Group together being the "
Uncertificated Interests
"); and
|
(B)
|
Buyer confirms that, provided that the Seller's statements in sub-clause 3.1 (A) above are true and accurate, it does not require an original or certified copy of any share certificate in respect
|
4.
|
AGREEMENT IN RELATION TO BUYER OBLIGATIONS
|
4.1
|
The Parties acknowledge and agree the following, and the SPA Parties acknowledge and agree that, subject to clause 4.2, receipt of all relevant amounts pursuant to the transfers contemplated by this clause 4.1 shall be deemed to satisfy Buyer’s obligations under Sections 3(b), 7.1(c), 7.1(d) and 7.1(e) of the SPA:
|
(A)
|
Before, and in anticipation of, Closing, Buyer will make the following transfers of funds:
|
a.
|
a transfer of the sum of €424,348,881.59 (the "
Aggregate Purchase Price Amount
") to Seller, representing the Purchase Price calculated on the assumption that Closing occurs on 5
th
February 2018, such Aggregate Purchase Price Amount to be paid to the bank account of Seller set out in the Appendix to this Agreement (the "
Seller Account
");
|
b.
|
a transfer of the sum of €439,327,020.84 (the "
Aggregate Term Debt Amount
") to Paroc Group, representing (i) the portion of the Release Amount relating to the Existing Term Debt calculated on the assumption such pay-off funds are received by the Agent at or before the Prepayment Time on 5
th
February 2018
plus
(ii) an amount of €57,229.17, being the portion of the additional interest that would be payable under the Senior Facilities Agreement in relation to the Existing Term Debt if such pay-off funds are received by the Agent after the Prepayment Time on 5
th
February 2018 but at or before the Prepayment Time on 6
th
February 2018, such Aggregate Term Debt Amount to be paid to the bank account of Paroc Group set out in the Appendix to this Agreement (the "
Paroc Group Account
");
|
c.
|
a transfer of the sum of €5,116,969.22 (the "
Aggregate Revolving Debt Amount
") to Paroc Oy AB, representing (i) the portion of the Release Amount relating to the Existing Revolving Debt calculated on the assumption such pay-off funds are received by the Agent at or before the Prepayment Time on 5
th
February 2018
plus
(ii) an amount of €3,331.89, being the portion of the additional interest that would be payable under the Senior Facilities Agreement in relation to the Existing Revolving Debt if such pay-off funds are received by the Agent after the Prepayment Time on 5
th
February 2018 but at or before the Prepayment Time on 6
th
February 2018, such Aggregate Revolving Debt
Amount to be paid to the bank account of Paroc Oy AB set out in the Appendix to this Agreement (the "
Paroc Oy AB Account
"); and
|
d.
|
a transfer of the sum of €51,249,221.52 (the "
Aggregate Intercompany Debt Amount
") to the Company, representing the Project Parry Existing Intercompany Loan Amount (as defined in the SPA) calculated on the assumption that Closing occurs on 5
th
February 2018, such Aggregate Intercompany Debt Amount to be paid to the bank account of the Company set out in the Appendix to this Agreement (the "
Company
Account
").
|
(B)
|
Paroc Group hereby covenants and undertakes to Buyer that, immediately upon receipt of the SWIFT confirmation relating to the transfer of the Aggregate Term Debt Amount from Buyer, it shall give irrevocable instructions to the relevant bank (and shall take such other actions (if any) as Buyer may reasonably request) to transfer the Aggregate Term Debt Amount to the bank account of the Agent set out in the Appendix to this Agreement (the "
Agent Account
"), and that until such time as such transfer has been made, it shall (i) hold the Aggregate Term Debt Amount to the order of Buyer and (ii) not use, dispose of or apply the Aggregate Term Debt Amount for any purpose other than to comply with its obligations under this sub-clause (B) or clause 4.4.
|
(C)
|
Paroc Oy AB hereby covenants and undertakes to Buyer that, immediately upon receipt of the SWIFT confirmation relating to the transfer of the Aggregate Revolving Debt
Amount from Buyer, it shall give irrevocable instructions to the relevant bank (and shall take such other actions (if any) as Buyer may reasonably request) to transfer the Aggregate Revolving Debt
Amount to the Agent Account, and that until such time as such transfer has been made, it shall (i) hold the Aggregate Revolving Debt
Amount to the order of Buyer and (ii) not use, dispose of or apply the Aggregate Revolving Debt
Amount for any purpose other than to comply with its obligations under this sub-clause (C) or clause 4.4.
|
(D)
|
The Company hereby covenants and undertakes to Buyer that, immediately upon receipt of the SWIFT confirmation relating to the transfer of the Aggregate Intercompany Debt Amount from Buyer, it shall give irrevocable instructions to the relevant bank (and shall take such other actions (if any) as Buyer may reasonably request) to transfer the Aggregate Intercompany Debt Amount to the bank account of Parry Jersey referred to in the Appendix to this Agreement (the "
Parry Jersey Account
"), and that until such time as such transfer has been made, it shall (i) hold the Aggregate Intercompany Debt Amount to the order of Buyer and (ii) not use, dispose of or apply the Aggregate Intercompany Debt Amount for any purpose other than to comply with its obligations under this sub-clause (D) or clause 4.4.
|
4.2
|
Unless otherwise agreed in writing by Seller, if Closing (as defined in the SPA) does not occur on 5th February 2018 then before, and in anticipation of, Closing on 6
th
February 2018:
|
(A)
|
Buyer will make the following transfers of funds:
|
a.
|
a transfer of the sum of €12,651.81 (the "
Additional Purchase Price Amount
") to Seller, representing the agreed net amount payable in addition to the Aggregate Purchase Price Amount if the Purchase Price is calculated on the assumption that Closing occurs on 6th February 2018, such Additional Purchase Price Amount to be paid to the Seller Account; and
|
b.
|
a transfer of the sum of €13,903.75 (the "
Additional Intercompany Debt Amount
") to the Company, representing the amount payable in addition to the Aggregate Intercompany Loan Amount if the Project Parry Existing Intercompany Loan Amount is calculated on the assumption that Closing occurs on 6th February 2018, such Additional Intercompany Debt Amount to be paid to the Company Account; and
|
(B)
|
the Company hereby covenants and undertakes to Buyer that, immediately upon receipt of the SWIFT confirmation relating to the transfer of the Additional Intercompany Debt Amount from Buyer, it shall give irrevocable instructions to the relevant bank (and shall take such other actions (if any) as Buyer may reasonably request) to transfer the Additional Intercompany Debt Amount to the Parry Jersey Account and that, until such time as such transfer has been made, it shall (i) hold the Additional Intercompany Debt Amount to the order of Buyer and (ii) not use, dispose of or apply the Additional Intercompany Debt Amount for any purpose other than to comply with its obligations under this sub-clause (B) or clause 4.4,
|
(A)
|
Seller covenants and undertakes to Buyer that, following receipt of the funds transferred to it pursuant to clause 4.1 (A)a and/or clause 4.2 (A)a above, it will (i) hold the Aggregate Purchase Price Amount and, if applicable, the Additional Purchase Price Amount to the order of Buyer and (ii) not use, dispose of or apply the Aggregate Purchase Price Amount or, if applicable, the Additional Purchase Price Amount for any purpose other than to comply with its obligations under clause 4.4; and
|
(B)
|
Parry Jersey covenants and undertakes to Buyer that, following receipt of the funds transferred to it pursuant to clause 4.1 (D) and/or clause 4.2 (B), it will (i) hold the Aggregate Intercompany Debt Amount and, if applicable, the Additional Intercompany Debt Amount to the order of Buyer and (ii) not use, dispose of or apply the Aggregate Intercompany Debt Amount or, if applicable, the Additional Intercompany Debt Amount for any purpose other than to comply with its obligations under clause 4.4.
|
4.4
|
If Closing does not occur by 1.00 p.m. (UK time) on 6
th
February 2018 then, unless otherwise agreed in writing by Buyer, as soon as reasonably practicable thereafter and in any event by no later than 5.00 p.m. (UK time) on 6
th
February 2018:
|
(A)
|
to the extent that Seller received the Aggregate Purchase Price Amount or Additional Purchase Price Amount, Seller undertakes to give irrevocable instructions to the relevant bank
to repay to Buyer an amount equal to the Aggregate Purchase Price Amount and (if transferred to it pursuant to clause 4.2) the Additional Purchase Price Amount (in each case, net of interest costs or charges and other fees paid or payable by Seller), such payment to be made to the Buyer Account;
|
(B)
|
to the extent that Paroc Group holds the Aggregate Term Debt Amount, Paroc Group undertakes to give irrevocable instructions to the relevant bank to repay to Buyer an amount equal to the Aggregate Term Debt Amount (net of interest costs or charges and other fees paid or payable by Paroc Group), such payment to be made to the Buyer Account;
|
(C)
|
to the extent that Paroc Oy AB holds the Aggregate Revolving Debt
Amount, Paroc Oy AB undertakes to give irrevocable instructions to the relevant bank to repay to Buyer an amount equal to the Aggregate Revolving Debt
Amount (net of interest costs or charges and other fees paid or payable by Paroc Oy AB), such payment to be made to the Buyer Account;
|
(D)
|
to the extent that the Company holds the Aggregate Intercompany Debt Amount or the Additional Intercompany Debt Amount, the Company undertakes to give irrevocable instructions to the relevant bank to repay to Buyer an amount equal to the Aggregate Intercompany Debt Amount and (if transferred to it pursuant to clause 4.2) the Additional Intercompany Debt Amount (in each case, net of interest costs or charges and other fees paid or payable by the Company), such payment to be made to the Buyer Account; and
|
(E)
|
to the extent that Parry Jersey holds the Aggregate Intercompany Debt Amount or the Additional Intercompany Debt Amount, Parry Jersey undertakes to give irrevocable instructions to the relevant bank
to repay to Buyer an amount equal to the Aggregate Intercompany Debt Amount and (if transferred to it pursuant to clause 4.2) the Additional Intercompany Debt Amount (in each case, net of interest costs or charges and other fees payable by Parry Jersey), such payment to be made to the Buyer Account.
|
5.
|
SPA remains in full force and effect
|
6.
|
MISCELLANEOUS
|
6.2.1
|
Seller warrants to Buyer that the statements set out in Sections 8.3(a) and 8.3(e) of the SPA are true, correct and not misleading (in the case of Section 8.3(e), in respect of this Agreement only) as at the date of this Agreement.
|
6.2.2
|
Buyer warrants to Seller that the statements set out in Sections 9.1 and 9.2 of the SPA are true, correct and not misleading (in the case of Section 9.2, in respect of this Agreement only) as at the date of this Agreement.
|
Account name
|
|
Account number
|
|
Sort code
|
|
IBAN
|
|
SWIFT code
|
|
Bank name
|
|
Key contact name
|
|
Key contact telephone
|
|
Key contact e-mail
|
|
Payment reference
|
|
Account name
|
|
Account number
|
|
Sort code
|
|
IBAN
|
|
SWIFT code
|
|
Bank name
|
|
Key contact name
|
|
Key contact telephone
|
|
Key contact e-mail
|
|
Payment reference
|
|
Account name
|
|
Account number
|
|
Sort code
|
|
IBAN
|
|
SWIFT code
|
|
Bank name
|
|
Key contact name
|
|
Key contact telephone
|
|
Key contact e-mail
|
|
Payment reference
|
|
Account name
|
|
Account number
|
|
Sort code
|
|
IBAN
|
|
SWIFT code
|
|
Bank name
|
|
Key contact name
|
|
Key contact telephone
|
|
Key contact e-mail
|
|
Payment reference
|
|
Account name
|
|
Account number
|
|
Sort code
|
|
IBAN
|
|
SWIFT code
|
|
Bank name
|
|
Key contact name
|
|
Key contact telephone
|
|
Key contact e-mail
|
|
Payment reference
|
|
Account name
|
|
Account number
|
|
Sort code
|
|
IBAN
|
|
SWIFT code
|
|
Bank name
|
|
Key contact name
|
|
Key contact telephone
|
|
Key contact e-mail
|
|
Payment reference
|
|
Account name
|
|
Account number
|
|
Sort code
|
|
IBAN
|
|
SWIFT code
|
|
Bank name
|
|
Key contact name
|
|
Key contact telephone
|
|
Key contact e-mail
|
|
Payment reference
|
|
Purchaser Group
|
|
|
|
|
Name
|
Capacity
|
Commitment
|
Group Commitment
|
|
Liberty Street Purchaser Group
|
Purchaser Group
|
N/A
|
$112,000,000
|
|
|
Liberty Street
|
Conduit Purchaser
|
N/A
|
|
|
BNS
|
Related Committed Purchaser
|
$112,000,000
|
|
|
BNS
|
LC Bank
|
$80,000,000
|
|
|
BNS
|
Purchaser Agent
|
N/A
|
|
PNC Purchaser Group
|
Purchaser Group
|
N/A
|
$112,000,000
|
|
|
PNC
|
Related Committed Purchaser
|
$112,000,000
|
|
|
PNC
|
LC Bank
|
$80,000,000
|
|
|
PNC
|
Purchaser Agent
|
N/A
|
|
Atlantic Purchaser Group
|
Purchaser Group
|
N/A
|
$56,000,000
|
|
|
Atlantic
|
Conduit Purchaser
|
N/A
|
|
|
Credit Agricole
|
Related Committed Purchaser
|
$56,000,000
|
|
|
Credit Agricole
|
Purchaser Agent
|
N/A
|
|
1.
|
Rights as a Stockholder
.
|
2.
|
Custody and Delivery of Certificates Representing Stock
.
|
3.
|
Restriction Period and Vesting
.
|
(a)
|
if to the Company or the Committee, to the attention of the Vice President, Total Rewards, Owens Corning World Headquarters, One Owens Corning Parkway, Toledo, Ohio 43659, or to the attention of such other person or at such other address as the Company, by notice to the Holder, may designate in writing from time to time, and
|
(b)
|
if to the Holder, at his address as shown on the records of the Company, or at such other address as the Holder, by notice to the Company, may designate in writing from time to time.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Owens Corning;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Owens Corning;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
Information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
Information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|