Exhibit 99.1 | |||||||||||
News Release | |||||||||||
Axalta Coating Systems 50 Applied Bank Blvd Suite 300 Glen Mills, PA 19342 USA | Investor Contact Christopher Evans D +1 484 724 4099 Christopher.Evans@axalta.com |
Financial Statement Tables | ||||||||||||||||||||||||||
AXALTA COATING SYSTEMS LTD. | ||||||||||||||||||||||||||
Condensed Consolidated Statements of Operations (Unaudited) | ||||||||||||||||||||||||||
(In millions, except per share data) | ||||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Net sales | $ | 1,238.7 | $ | 1,088.6 | $ | 3,647.7 | $ | 3,279.0 | ||||||||||||||||||
Cost of goods sold | 876.6 | 745.3 | 2,600.4 | 2,182.6 | ||||||||||||||||||||||
Selling, general and administrative expenses | 186.4 | 181.0 | 571.6 | 544.3 | ||||||||||||||||||||||
Other operating charges (benefits) | 5.3 | (7.6) | 17.8 | 49.5 | ||||||||||||||||||||||
Research and development expenses | 16.5 | 15.4 | 49.6 | 46.8 | ||||||||||||||||||||||
Amortization of acquired intangibles | 30.4 | 29.8 | 94.9 | 88.1 | ||||||||||||||||||||||
Income from operations | 123.5 | 124.7 | 313.4 | 367.7 | ||||||||||||||||||||||
Interest expense, net | 35.0 | 33.8 | 101.1 | 100.7 | ||||||||||||||||||||||
Other expense (income), net | 3.4 | (2.4) | 12.4 | (10.9) | ||||||||||||||||||||||
Income before income taxes | 85.1 | 93.3 | 199.9 | 277.9 | ||||||||||||||||||||||
Provision for income taxes | 21.8 | 24.4 | 51.6 | 66.9 | ||||||||||||||||||||||
Net income | 63.3 | 68.9 | 148.3 | 211.0 | ||||||||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests | 0.9 | (0.2) | 0.3 | 0.3 | ||||||||||||||||||||||
Net income attributable to controlling interests | $ | 62.4 | $ | 69.1 | $ | 148.0 | $ | 210.7 | ||||||||||||||||||
Basic net income per share | $ | 0.28 | $ | 0.30 | $ | 0.67 | $ | 0.91 | ||||||||||||||||||
Diluted net income per share | $ | 0.28 | $ | 0.30 | $ | 0.66 | $ | 0.90 | ||||||||||||||||||
Basic weighted average shares outstanding | 220.6 | 229.9 | 222.0 | 232.1 | ||||||||||||||||||||||
Diluted weighted average shares outstanding | 221.2 | 230.7 | 222.6 | 233.0 |
AXALTA COATING SYSTEMS LTD. | ||||||||||||||
Condensed Consolidated Balance Sheets (Unaudited) | ||||||||||||||
(In millions, except per share data) | ||||||||||||||
September 30, 2022 | December 31, 2021 | |||||||||||||
Assets | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | $ | 517.4 | $ | 840.6 | ||||||||||
Restricted cash | 9.3 | 10.6 | ||||||||||||
Accounts and notes receivable, net | 1,106.9 | 937.5 | ||||||||||||
Inventories | 829.4 | 669.7 | ||||||||||||
Prepaid expenses and other current assets | 205.4 | 117.2 | ||||||||||||
Total current assets | 2,668.4 | 2,575.6 | ||||||||||||
Property, plant and equipment, net | 1,121.5 | 1,186.2 | ||||||||||||
Goodwill | 1,390.4 | 1,592.7 | ||||||||||||
Identifiable intangibles, net | 1,093.5 | 1,278.2 | ||||||||||||
Other assets | 545.2 | 584.5 | ||||||||||||
Total assets | $ | 6,819.0 | $ | 7,217.2 | ||||||||||
Liabilities, Shareholders’ Equity | ||||||||||||||
Current liabilities: | ||||||||||||||
Accounts payable | $ | 746.6 | $ | 657.4 | ||||||||||
Current portion of borrowings | 66.7 | 79.7 | ||||||||||||
Other accrued liabilities | 536.4 | 597.8 | ||||||||||||
Total current liabilities | 1,349.7 | 1,334.9 | ||||||||||||
Long-term borrowings | 3,663.3 | 3,749.9 | ||||||||||||
Accrued pensions | 227.3 | 269.3 | ||||||||||||
Deferred income taxes | 139.5 | 174.7 | ||||||||||||
Other liabilities | 119.8 | 149.7 | ||||||||||||
Total liabilities | 5,499.6 | 5,678.5 | ||||||||||||
Shareholders’ equity: | ||||||||||||||
Common shares, $1.00 par, 1,000.0 shares authorized, 252.4 and 251.8 shares issued at September 30, 2022 and December 31, 2021, respectively | 252.4 | 251.8 | ||||||||||||
Capital in excess of par | 1,526.9 | 1,515.5 | ||||||||||||
Retained earnings | 975.2 | 827.2 | ||||||||||||
Treasury shares, at cost, 31.8 and 24.4 shares at September 30, 2022 and December 31, 2021, respectively | (887.3) | (687.2) | ||||||||||||
Accumulated other comprehensive loss | (593.9) | (414.4) | ||||||||||||
Total Axalta shareholders’ equity | 1,273.3 | 1,492.9 | ||||||||||||
Noncontrolling interests | 46.1 | 45.8 | ||||||||||||
Total shareholders’ equity | 1,319.4 | 1,538.7 | ||||||||||||
Total liabilities and shareholders’ equity | $ | 6,819.0 | $ | 7,217.2 |
AXALTA COATING SYSTEMS LTD. | ||||||||||||||
Condensed Consolidated Statements of Cash Flows (Unaudited) | ||||||||||||||
(In millions) | ||||||||||||||
Nine Months Ended September 30, | ||||||||||||||
2022 | 2021 | |||||||||||||
Operating activities: | ||||||||||||||
Net income | $ | 148.3 | $ | 211.0 | ||||||||||
Adjustment to reconcile net income to cash provided by operating activities: | ||||||||||||||
Depreciation and amortization | 229.5 | 234.7 | ||||||||||||
Amortization of deferred financing costs and original issue discount | 7.2 | 6.7 | ||||||||||||
Deferred income taxes | 2.8 | 9.3 | ||||||||||||
Realized and unrealized foreign exchange losses, net | 5.5 | 9.5 | ||||||||||||
Stock-based compensation | 14.0 | 11.7 | ||||||||||||
Gain on sale of facility | — | (8.9) | ||||||||||||
Interest income on swaps designated as net investment hedges | (16.1) | (14.3) | ||||||||||||
Commercial agreement restructuring charge | 25.0 | — | ||||||||||||
Other non-cash, net | (1.5) | 11.3 | ||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||
Trade accounts and notes receivable | (242.4) | (168.5) | ||||||||||||
Inventories | (220.8) | (107.8) | ||||||||||||
Prepaid expenses and other assets | (78.9) | (64.3) | ||||||||||||
Accounts payable | 189.7 | 88.3 | ||||||||||||
Other accrued liabilities | (2.5) | 61.3 | ||||||||||||
Other liabilities | (11.6) | 10.0 | ||||||||||||
Cash provided by operating activities | 48.2 | 290.0 | ||||||||||||
Investing activities: | ||||||||||||||
Acquisitions, net of cash acquired | — | (647.3) | ||||||||||||
Purchase of property, plant and equipment | (107.5) | (98.7) | ||||||||||||
Interest proceeds on swaps designated as net investment hedges | 16.1 | 14.3 | ||||||||||||
Settlement proceeds on swaps designated as net investment hedges | 25.0 | — | ||||||||||||
Other investing activities, net | (1.5) | 11.8 | ||||||||||||
Cash used for investing activities | (67.9) | (719.9) | ||||||||||||
Financing activities: | ||||||||||||||
Payments on short-term borrowings | (52.3) | (54.5) | ||||||||||||
Payments on long-term borrowings | (20.5) | (20.1) | ||||||||||||
Financing-related costs | (0.1) | (2.6) | ||||||||||||
Purchases of common stock | (200.1) | (213.8) | ||||||||||||
Net cash flows associated with stock-based awards | (1.7) | 12.7 | ||||||||||||
Other financing activities, net | (0.2) | (1.2) | ||||||||||||
Cash used for financing activities | (274.9) | (279.5) | ||||||||||||
Decrease in cash | (294.6) | (709.4) | ||||||||||||
Effect of exchange rate changes on cash | (29.9) | (16.5) | ||||||||||||
Cash at beginning of period | 851.2 | 1,364.0 | ||||||||||||
Cash at end of period | $ | 526.7 | $ | 638.1 | ||||||||||
Cash at end of period reconciliation: | ||||||||||||||
Cash and cash equivalents | $ | 517.4 | $ | 627.7 | ||||||||||
Restricted cash | 9.3 | 10.4 | ||||||||||||
Cash at end of period | $ | 526.7 | $ | 638.1 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Income from operations | $ | 123.5 | $ | 124.7 | $ | 313.4 | $ | 367.7 | ||||||||||||||||||
Other expense (income), net | 3.4 | (2.4) | 12.4 | (10.9) | ||||||||||||||||||||||
Total | 120.1 | 127.1 | 301.0 | 378.6 | ||||||||||||||||||||||
Termination benefits and other employee related costs (a) | 5.0 | 9.6 | 10.1 | 35.1 | ||||||||||||||||||||||
Strategic review and retention costs (b) | — | 2.1 | — | 9.7 | ||||||||||||||||||||||
Acquisition and divestiture-related costs (c) | 0.2 | 9.2 | 2.8 | 10.8 | ||||||||||||||||||||||
Accelerated depreciation and site closure costs (d) | 1.1 | 0.6 | 4.2 | 1.8 | ||||||||||||||||||||||
Operational matter (e) | (0.1) | (18.7) | 0.1 | 3.9 | ||||||||||||||||||||||
Brazil indirect tax (f) | — | — | — | (8.3) | ||||||||||||||||||||||
Gain on sale of facility (g) | — | (8.9) | — | (8.9) | ||||||||||||||||||||||
Russia sanction-related impacts (h) | (1.3) | — | 4.8 | — | ||||||||||||||||||||||
Commercial agreement restructuring impacts (i) | — | — | 25.0 | — | ||||||||||||||||||||||
Other adjustments (j) | 0.4 | (0.9) | — | (0.8) | ||||||||||||||||||||||
Step-up depreciation and amortization (k) | 22.6 | 25.9 | 70.1 | 80.3 | ||||||||||||||||||||||
Adjusted EBIT | $ | 148.0 | $ | 146.0 | $ | 418.1 | $ | 502.2 | ||||||||||||||||||
Segment Adjusted EBIT: | ||||||||||||||||||||||||||
Performance Coatings | $ | 121.8 | $ | 122.8 | $ | 341.6 | $ | 379.7 | ||||||||||||||||||
Mobility Coatings | 3.6 | (2.7) | 6.4 | 42.2 | ||||||||||||||||||||||
Total | 125.4 | 120.1 | 348.0 | 421.9 | ||||||||||||||||||||||
Step-up depreciation and amortization (k) | 22.6 | 25.9 | 70.1 | 80.3 | ||||||||||||||||||||||
Adjusted EBIT | $ | 148.0 | $ | 146.0 | $ | 418.1 | $ | 502.2 |
(a) | Represents expenses and associated changes to estimates related to employee termination benefits and other employee-related costs, which includes costs related to the transition of our CEO. Employee termination benefits are primarily associated with Axalta Way initiatives. These amounts are not considered indicative of our ongoing operating performance. | ||||
(b) | Represents costs for legal, tax and other advisory fees pertaining to our review of strategic alternatives that was concluded in March 2020, as well as retention awards for certain employees that were earned over a period of 18-24 months, which ended in September 2021. These amounts are not considered indicative of our ongoing performance. | ||||
(c) | Represents acquisition and divestiture-related expenses and integration activities associated with our business combinations, all of which are not considered indicative of our ongoing operating performance. The amount for the nine months ended September 30, 2022 includes $1.9 million of due diligence and other related costs associated with unconsummated merger and acquisition transactions. | ||||
(d) | Represents incremental depreciation expense resulting from truncated useful lives of the assets impacted by our manufacturing footprint assessments and costs related to the closure of certain manufacturing sites, which we do not consider indicative of our ongoing operating performance. | ||||
(e) | Represents expenses, changes in estimates and insurance recoveries for probable liabilities related to an operational matter in the Mobility Coatings segment, which we do not consider indicative of our ongoing operating performance. | ||||
(f) | Represents non-recurring income related to a law change with respect to certain Brazilian indirect taxes which was recorded within other expense (income), net. | ||||
(g) | Represents non-recurring income related to the sale of a previously closed manufacturing facility. | ||||
(h) | Represents (benefits) expenses related to sanctions imposed on Russia in response to the conflict with Ukraine as a result of incremental reserves for accounts receivable, inventory obsolescence and business incentive payments, which we do not consider indicative of our ongoing operating performance. The benefits recorded during the three months ended September 30, 2022 are related to changes in estimated inventory obsolescence. | ||||
(i) | Represents a forgiveness of a portion of up-front customer incentives with repayment features upon our customer completing a recapitalization and restructuring of its indebtedness and the execution of a new long-term exclusive sales agreement with us. These amounts are not considered to be indicative of our ongoing operating performance. | ||||
(j) | Represents costs for certain non-operational or non-cash losses and (gains), unrelated to our core business and which we do not consider indicative of ongoing operations. | ||||
(k) | Represents the incremental step-up depreciation and amortization expense associated with the acquisition of DuPont Performance Coatings by Axalta. We believe this will assist investors in performing meaningful comparisons of past, present and future operating results and better highlight the results of our ongoing operating performance. |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Net income | $ | 63.3 | $ | 68.9 | $ | 148.3 | $ | 211.0 | ||||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests | 0.9 | (0.2) | 0.3 | 0.3 | ||||||||||||||||||||||
Net income attributable to controlling interests | 62.4 | 69.1 | 148.0 | 210.7 | ||||||||||||||||||||||
Termination benefits and other employee related costs (a) | 4.8 | 9.6 | 9.9 | 35.1 | ||||||||||||||||||||||
Strategic review and retention costs (b) | — | 2.1 | — | 9.7 | ||||||||||||||||||||||
Acquisition and divestiture-related costs (c) | 0.2 | 9.2 | 2.8 | 10.8 | ||||||||||||||||||||||
Accelerated depreciation and site closure costs (d) | 1.1 | 0.6 | 4.2 | 1.8 | ||||||||||||||||||||||
Operational matter (e) | (0.1) | (18.7) | 0.1 | 3.9 | ||||||||||||||||||||||
Brazil indirect tax (f) | — | — | — | (8.3) | ||||||||||||||||||||||
Gain on sale of facility (g) | — | (8.9) | — | (8.9) | ||||||||||||||||||||||
Russia sanction-related impacts (h) | (0.5) | — | 4.7 | — | ||||||||||||||||||||||
Commercial agreement restructuring impacts (i) | — | — | 25.0 | — | ||||||||||||||||||||||
Other adjustments (j) | 0.4 | (0.9) | — | (0.8) | ||||||||||||||||||||||
Step-up depreciation and amortization (k) | 22.6 | 25.9 | 70.1 | 80.3 | ||||||||||||||||||||||
Total adjustments | 28.5 | 18.9 | 116.8 | 123.6 | ||||||||||||||||||||||
Income tax provision impacts (l) | 4.9 | (1.3) | 19.4 | 15.5 | ||||||||||||||||||||||
Adjusted net income | $ | 86.0 | $ | 89.3 | $ | 245.4 | $ | 318.8 | ||||||||||||||||||
Diluted adjusted net income per share | $ | 0.39 | $ | 0.39 | $ | 1.10 | $ | 1.37 | ||||||||||||||||||
Diluted weighted average shares outstanding | 221.2 | 230.7 | 222.6 | 233.0 |
(a) | Represents expenses and associated changes to estimates related to employee termination benefits and other employee-related costs, which includes costs related to the transition of our CEO. Employee termination benefits are primarily associated with Axalta Way initiatives. These amounts are not considered indicative of our ongoing operating performance. | ||||
(b) | Represents costs for legal, tax and other advisory fees pertaining to our review of strategic alternatives that was concluded in March 2020, as well as retention awards for certain employees that were earned over a period of 18-24 months, which ended in September 2021. These amounts are not considered indicative of our ongoing performance. | ||||
(c) | Represents acquisition and divestiture-related expenses and integration activities associated with our business combinations, all of which are not considered indicative of our ongoing operating performance. The amount for the nine months ended September 30, 2022 includes $1.9 million of due diligence and other related costs associated with unconsummated merger and acquisition transactions. | ||||
(d) | Represents incremental depreciation expense resulting from truncated useful lives of the assets impacted by our manufacturing footprint assessments and costs related to the closure of certain manufacturing sites, which we do not consider indicative of our ongoing operating performance. | ||||
(e) | Represents expenses, changes in estimates and insurance recoveries for probable liabilities related to an operational matter in the Mobility Coatings segment, which we do not consider indicative of our ongoing operating performance. | ||||
(f) | Represents non-recurring income related to a law change with respect to certain Brazilian indirect taxes which was recorded within other expense (income), net. | ||||
(g) | Represents non-recurring income related to the sale of a previously closed manufacturing facility. | ||||
(h) | Represents (benefits) expenses related to sanctions imposed on Russia in response to the conflict with Ukraine as a result of incremental reserves for accounts receivable, inventory obsolescence and business incentive payments, which we do not consider indicative of our ongoing operating performance. The benefits recorded during the three months ended September 30, 2022 are related to changes in estimated inventory obsolescence. | ||||
(i) | Represents a forgiveness of a portion of up-front customer incentives with repayment features upon our customer completing a recapitalization and restructuring of its indebtedness and the execution of a new long-term exclusive sales agreement with us. These amounts are not considered to be indicative of our ongoing operating performance. | ||||
(j) | Represents costs for certain non-operational or non-cash losses and (gains), unrelated to our core business and which we do not consider indicative of ongoing operations. | ||||
(k) | Represents the incremental step-up depreciation and amortization expense associated with the acquisition of DuPont Performance Coatings by Axalta. We believe this will assist investors in performing meaningful comparisons of past, present and future operating results and better highlight the results of our ongoing operating performance. | ||||
(l) | The income tax impacts are determined using the applicable rates in the taxing jurisdictions in which expense or income occurred and includes both current and deferred income tax expense (benefit) based on the nature of the non-GAAP performance measure. Additionally, the income tax impact includes the removal of discrete income tax impacts within our effective tax rate which were expenses of $2.0 million, $7.0 million, $3.1 million and $6.9 million for the three and nine months ended September 30, 2022 and 2021, respectively. The tax adjustments for the three and nine months ended September 30, 2022 and 2021 include the deferred tax benefit ratably amortized into our adjusted income tax rate as the tax attribute related to a January 1, 2020 intra-entity transfer of certain intellectual property rights is realized. |
Three Months Ended March 31, | Three Months Ended June 30, | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||||||||||||||||||||||
Cash (used for) provided by operating activities | $ | (43.9) | $ | 39.6 | $ | 12.2 | $ | 107.5 | $ | 79.9 | $ | 142.9 | $ | 48.2 | 290.0 | |||||||||||||||||||||||||||||||||||
Purchase of property, plant and equipment | (42.5) | (31.8) | (29.5) | (28.5) | (35.5) | (38.4) | (107.5) | (98.7) | ||||||||||||||||||||||||||||||||||||||||||
Interest proceeds on swaps designated as net investment hedges | 6.2 | 3.5 | 3.8 | 3.6 | 6.1 | 7.2 | 16.1 | 14.3 | ||||||||||||||||||||||||||||||||||||||||||
Free cash flow | $ | (80.2) | $ | 11.3 | $ | (13.5) | $ | 82.6 | $ | 50.5 | $ | 111.7 | $ | (43.2) | $ | 205.6 |
Three Months Ended September 30, | Twelve Months Ended September 30, 2022 | Nine Months Ended September 30, | Year Ended December 31, 2021 | |||||||||||||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||||||||||||||
Net income | $ | 63.3 | $ | 68.9 | $ | 201.7 | $ | 148.3 | $ | 211.0 | $ | 264.4 | ||||||||||||||||||||||||||
Interest expense, net | 35.0 | 33.8 | 134.6 | 101.1 | 100.7 | 134.2 | ||||||||||||||||||||||||||||||||
Provision for income taxes | 21.8 | 24.4 | 60.8 | 51.6 | 66.9 | 76.1 | ||||||||||||||||||||||||||||||||
Depreciation and amortization | 74.5 | 79.3 | 311.3 | 229.5 | 234.7 | 316.5 | ||||||||||||||||||||||||||||||||
EBITDA | 194.6 | 206.4 | 708.4 | 530.5 | 613.3 | 791.2 | ||||||||||||||||||||||||||||||||
Termination benefits and other employee related costs (a) | 5.0 | 9.6 | 11.4 | 9.6 | 35.1 | 36.9 | ||||||||||||||||||||||||||||||||
Strategic review and retention costs (b) | — | 2.1 | — | — | 9.7 | 9.7 | ||||||||||||||||||||||||||||||||
Acquisition and divestiture-related costs (c) | 0.2 | 9.2 | 8.3 | 2.8 | 10.8 | 16.3 | ||||||||||||||||||||||||||||||||
Site closure costs (d) | 0.4 | — | 2.7 | 2.1 | — | 0.6 | ||||||||||||||||||||||||||||||||
Foreign exchange remeasurement losses (gains) (e) | 5.8 | (1.3) | 13.3 | 13.3 | 2.3 | 2.3 | ||||||||||||||||||||||||||||||||
Long-term employee benefit plan adjustments (f) | 0.2 | (0.3) | 0.5 | 0.4 | (0.8) | (0.7) | ||||||||||||||||||||||||||||||||
Stock-based compensation (g) | 5.0 | 3.9 | 17.2 | 14.0 | 11.7 | 14.9 | ||||||||||||||||||||||||||||||||
Dividends in respect of noncontrolling interest (h) | — | — | (0.1) | (0.1) | (0.7) | (0.7) | ||||||||||||||||||||||||||||||||
Operational matter (i) | (0.1) | (18.7) | 0.6 | 0.1 | 3.9 | 4.4 | ||||||||||||||||||||||||||||||||
Brazil indirect tax (j) | — | — | — | — | (8.3) | (8.3) | ||||||||||||||||||||||||||||||||
Gain on sale of facility (k) | — | (8.9) | (10.8) | — | (8.9) | (19.7) | ||||||||||||||||||||||||||||||||
Russia sanction-related impacts (l) | (1.3) | — | 4.8 | 4.8 | — | — | ||||||||||||||||||||||||||||||||
Commercial agreement restructuring impacts (m) | — | — | 25.0 | 25.0 | — | — | ||||||||||||||||||||||||||||||||
Other adjustments (n) | 0.5 | (1.0) | 1.7 | 0.1 | (0.7) | 0.9 | ||||||||||||||||||||||||||||||||
Adjusted EBITDA | $ | 210.3 | $ | 201.0 | $ | 783.0 | $ | 602.6 | $ | 667.4 | $ | 847.8 | ||||||||||||||||||||||||||
Adjusted EBITDA to interest expense coverage ratio | 5.8 | x |
(a) | Represents expenses and associated changes to estimates related to employee termination benefits and other employee-related costs, which includes costs related to the transition of our CEO. Employee termination benefits are primarily associated with Axalta Way initiatives. These amounts are not considered indicative of our ongoing operating performance. | ||||
(b) | Represents costs for legal, tax and other advisory fees pertaining to our review of strategic alternatives that was concluded in March 2020, as well as retention awards for certain employees that were earned over a period of 18-24 months, which ended in September 2021. These amounts are not considered indicative of our ongoing performance. | ||||
(c) | Represents acquisition and divestiture-related expenses and integration activities associated with our business combinations, all of which are not considered indicative of our ongoing operating performance. The amount for the nine months ended September 30, 2022 includes $1.9 million of due diligence and other related costs associated with unconsummated merger and acquisition transactions. | ||||
(d) | Represents costs related to the closure of certain manufacturing sites, which we do not consider indicative of our ongoing operating performance. | ||||
(e) | Eliminates foreign exchange losses resulting from the remeasurement of assets and liabilities denominated in foreign currencies, net of the impacts of our foreign currency instruments used to hedge our balance sheet exposures. | ||||
(f) | Eliminates the non-cash, non-service cost components of long-term employee benefit costs. | ||||
(g) | Represents non-cash impacts associated with stock-based compensation. | ||||
(h) | Represents the payment of dividends to our joint venture partners by our consolidated entities that are not 100% owned, which are reflected to show the cash operating performance of these entities on Axalta’s financial statements. | ||||
(i) | Represents expenses, changes in estimates and insurance recoveries for probable liabilities related to an operational matter in the Mobility Coatings segment, which we do not consider indicative of our ongoing operating performance. | ||||
(j) | Represents non-recurring income related to a law change with respect to certain Brazilian indirect taxes which was recorded within other expense (income), net. | ||||
(k) | Represents non-recurring income related to the sale of a previously closed manufacturing facility. | ||||
(l) | Represents (benefits) expenses related to sanctions imposed on Russia in response to the conflict with Ukraine as a result of incremental reserves for accounts receivable, inventory obsolescence and business incentive payments, which we do not consider indicative of our ongoing operating performance. The benefits recorded during the three months ended September 30, 2022 are related to changes in estimated inventory obsolescence. | ||||
(m) | Represents a forgiveness of a portion of up-front customer incentives with repayment features upon our customer completing a recapitalization and restructuring of its indebtedness and the execution of a new long-term exclusive sales agreement with us. These amounts are not considered to be indicative of our ongoing operating performance. | ||||
(n) | Represents costs for certain non-operational or non-cash losses and (gains), unrelated to our core business and which we do not consider indicative of ongoing operations. |