Price Graph
Price
Yield
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Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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☒
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No
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☐
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☒
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No
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☐
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☒
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Accelerated Filer
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☐
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Non-accelerated Filer
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☐
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Smaller Reporting Company
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Emerging Growth Company
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Yes
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No
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☒
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Page
No.
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Three Months Ended March 31,
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Six Months Ended March 31,
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2020
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2019
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2020
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2019
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||||||||
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(Unaudited)
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||||||||||||||
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Sales
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$
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$
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$
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$
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Cost of sales
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(
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(
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(
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(
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GROSS PROFIT
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Selling, general and administrative
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(
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)
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(
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(
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(
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)
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||||
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Income from WABCO distribution termination
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||||
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Other operating income (expense), net
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(
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)
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(
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)
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||||
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OPERATING INCOME
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Other income, net
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Equity in earnings of affiliates
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||||
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Interest expense, net
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(
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)
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(
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)
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(
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)
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(
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)
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||||
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INCOME BEFORE INCOME TAXES
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||||
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Provision for income taxes
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(
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)
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(
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)
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(
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(
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||||
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INCOME FROM CONTINUING OPERATIONS
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||||
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INCOME (LOSS) FROM DISCONTINUED OPERATIONS, net of tax
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(
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)
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(
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)
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||||
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NET INCOME
|
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||||
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Less: Net income attributable to noncontrolling interests
|
(
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(
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)
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(
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)
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(
|
)
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||||
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NET INCOME ATTRIBUTABLE TO MERITOR, INC.
|
$
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|
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$
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$
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$
|
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NET INCOME (LOSS) ATTRIBUTABLE TO MERITOR, INC.
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||||||||
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Net income from continuing operations
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$
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$
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|
$
|
|
|
|
$
|
|
|
|
Income (loss) from discontinued operations
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
||||
|
Net income
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
BASIC EARNINGS (LOSS) PER SHARE
|
|
|
|
|
|
|
|
||||||||
|
Continuing operations
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Discontinued operations
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
||||
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Basic earnings per share
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
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DILUTED EARNINGS (LOSS) PER SHARE
|
|
|
|
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||||||||
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Continuing operations
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Discontinued operations
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
||||
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Diluted earnings per share
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
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|
||||||||
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Basic average common shares outstanding
|
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||||
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Diluted average common shares outstanding
|
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||||
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Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
|
(Unaudited)
|
||||||||||||||
|
Net income
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
|
Foreign currency translation adjustments:
|
|
|
|
|
|
|
|
||||||||
|
Attributable to Meritor, Inc.
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Pension and other postretirement benefit related adjustments
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Unrealized loss on cash flow hedges
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
||||
|
Other comprehensive income (loss), net of tax
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Less: Comprehensive income attributable to noncontrolling interest
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
||||
|
Comprehensive income attributable to Meritor, Inc.
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
March 31,
2020 |
|
September 30,
2019 |
||||
|
|
(Unaudited)
|
||||||
|
ASSETS
|
|
|
|
||||
|
CURRENT ASSETS:
|
|
|
|
||||
|
Cash and cash equivalents
|
$
|
|
|
|
$
|
|
|
|
Receivables, trade and other, net
|
|
|
|
|
|
||
|
Inventories
|
|
|
|
|
|
||
|
Other current assets
|
|
|
|
|
|
||
|
TOTAL CURRENT ASSETS
|
|
|
|
|
|
||
|
NET PROPERTY
|
|
|
|
|
|
||
|
GOODWILL
|
|
|
|
|
|
||
|
OTHER ASSETS
|
|
|
|
|
|
||
|
TOTAL ASSETS
|
$
|
|
|
|
$
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
|
CURRENT LIABILITIES:
|
|
|
|
||||
|
Short-term debt
|
$
|
|
|
|
$
|
|
|
|
Accounts and notes payable
|
|
|
|
|
|
||
|
Other current liabilities
|
|
|
|
|
|
||
|
TOTAL CURRENT LIABILITIES
|
|
|
|
|
|
||
|
LONG-TERM DEBT
|
|
|
|
|
|
||
|
RETIREMENT BENEFITS
|
|
|
|
|
|
||
|
OTHER LIABILITIES
|
|
|
|
|
|
||
|
TOTAL LIABILITIES
|
|
|
|
|
|
||
|
COMMITMENTS AND CONTINGENCIES (See Note 20)
|
|
|
|
||||
|
|
|
|
|
||||
|
EQUITY:
|
|
|
|
||||
|
Common stock (March 31, 2020 and September 30, 2019, 103.7 and 104.1 shares issued and 72.3 and 81.4 shares outstanding, respectively)
|
|
|
|
|
|
||
|
Additional paid-in capital
|
|
|
|
|
|
||
|
Retained earnings
|
|
|
|
|
|
||
|
Treasury stock, at cost (March 31, 2020 and September 30, 2019, 31.4 and 22.7 shares, respectively)
|
(
|
)
|
|
(
|
)
|
||
|
Accumulated other comprehensive loss
|
(
|
)
|
|
(
|
)
|
||
|
Total equity attributable to Meritor, Inc.
|
|
|
|
|
|
||
|
Noncontrolling interests
|
|
|
|
|
|
||
|
TOTAL EQUITY
|
|
|
|
|
|
||
|
TOTAL LIABILITIES AND EQUITY
|
$
|
|
|
|
$
|
|
|
|
|
Six Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
|
|
(Unaudited)
|
||||||
|
OPERATING ACTIVITIES
|
|
|
|
||||
|
Net income
|
$
|
|
|
|
$
|
|
|
|
Less: Income (loss) from discontinued operations, net of tax
|
|
|
|
(
|
)
|
||
|
Income from continuing operations
|
|
|
|
|
|
||
|
Adjustments to income from continuing operations to arrive at cash provided by operating activities:
|
|
|
|
||||
|
Depreciation and amortization
|
|
|
|
|
|
||
|
Deferred income tax expense (benefit)
|
(
|
)
|
|
|
|
||
|
Restructuring costs
|
|
|
|
(
|
)
|
||
|
Equity in earnings of affiliates
|
(
|
)
|
|
(
|
)
|
||
|
Pension and retiree medical income
|
(
|
)
|
|
(
|
)
|
||
|
Asbestos related liability remeasurement
|
|
|
|
(
|
)
|
||
|
Other adjustments to income from continuing operations
|
|
|
|
|
|
||
|
Dividends received from equity method investments
|
|
|
|
|
|
||
|
Pension and retiree medical contributions
|
(
|
)
|
|
(
|
)
|
||
|
Restructuring payments
|
(
|
)
|
|
(
|
)
|
||
|
Changes in off-balance sheet accounts receivable securitization and factoring programs
|
|
|
|
|
|
||
|
Changes in receivables, inventories and accounts payable
|
(
|
)
|
|
(
|
)
|
||
|
Changes in other current assets and liabilities
|
(
|
)
|
|
(
|
)
|
||
|
Changes in other assets and liabilities
|
|
|
|
(
|
)
|
||
|
Operating cash flows provided by continuing operations
|
|
|
|
|
|
||
|
Operating cash flows used for discontinued operations
|
|
|
|
(
|
)
|
||
|
CASH PROVIDED BY OPERATING ACTIVITIES
|
|
|
|
|
|
||
|
INVESTING ACTIVITIES
|
|
|
|
||||
|
Capital expenditures
|
(
|
)
|
|
(
|
)
|
||
|
Cash paid for acquisition of Transportation Power, Inc., net of cash acquired
|
(
|
)
|
|
(
|
)
|
||
|
Other investing activities
|
|
|
|
|
|
||
|
CASH USED FOR INVESTING ACTIVITIES
|
(
|
)
|
|
(
|
)
|
||
|
FINANCING ACTIVITIES
|
|
|
|
||||
|
Securitization
|
|
|
|
|
|
||
|
Borrowings against revolving line of credit
|
|
|
|
|
|
||
|
Redemption of notes
|
|
|
|
(
|
)
|
||
|
Term loan payments
|
(
|
)
|
|
|
|
||
|
Other financing activities
|
(
|
)
|
|
(
|
)
|
||
|
Net change in debt
|
|
|
|
|
|
||
|
Repurchase of common stock
|
(
|
)
|
|
(
|
)
|
||
|
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES
|
|
|
|
(
|
)
|
||
|
EFFECT OF CHANGES IN FOREIGN CURRENCY EXCHANGE
RATES ON CASH AND CASH EQUIVALENTS
|
(
|
)
|
|
|
|
||
|
CHANGE IN CASH AND CASH EQUIVALENTS
|
|
|
|
(
|
)
|
||
|
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
|
|
|
|
|
|
||
|
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
$
|
|
|
|
$
|
|
|
|
|
Three months ended March 31, 2020
|
||||||||||||||||||||||||||||||
|
|
Common
Stock |
|
Additional
Paid-in Capital |
|
Retained Earnings
|
|
Treasury Stock
|
|
Accumulated
Other Comprehensive Loss |
|
Total Equity Attributable to
Meritor, Inc. |
|
Noncontrolling
Interests |
|
Total
|
||||||||||||||||
|
Beginning Balance at December 31, 2019
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Comprehensive income (loss)
|
—
|
|
|
—
|
|
|
|
|
|
—
|
|
|
(
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
|
Equity based compensation expense
|
—
|
|
|
(
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(
|
)
|
|
—
|
|
|
(
|
)
|
||||||||
|
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(
|
)
|
|
—
|
|
|
(
|
)
|
|
—
|
|
|
(
|
)
|
||||||||
|
Noncontrolling interest dividend
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(
|
)
|
|
(
|
)
|
||||||||
|
Other equity adjustments
|
—
|
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
||||||||
|
Ending Balance at March 31, 2020
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
|
Three months ended March 31, 2019
|
||||||||||||||||||||||||||||||
|
|
Common
Stock |
|
Additional
Paid-in Capital |
|
Retained Earnings
|
|
Treasury Stock
|
|
Accumulated
Other Comprehensive Loss |
|
Total Equity Attributable to
Meritor, Inc. |
|
Noncontrolling
Interests |
|
Total
|
||||||||||||||||
|
Beginning Balance at December 31, 2018
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Comprehensive income
|
—
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Equity based compensation expense
|
—
|
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
||||||||
|
Noncontrolling interest dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(
|
)
|
|
(
|
)
|
||||||||
|
Ending Balance at March 31, 2019
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Six months ended March 31, 2020
|
||||||||||||||||||||||||||||||
|
|
Common
Stock |
|
Additional
Paid-in Capital |
|
Retained Earnings
|
|
Treasury Stock
|
|
Accumulated
Other Comprehensive Loss |
|
Total Equity Attributable to
Meritor, Inc. |
|
Noncontrolling
Interests |
|
Total
|
||||||||||||||||
|
Beginning Balance at September 30, 2019
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Comprehensive income (loss)
|
—
|
|
|
—
|
|
|
|
|
|
—
|
|
|
(
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
|
Equity based compensation expense
|
—
|
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
||||||||
|
Vesting of equity based awards
|
|
|
|
(
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
||||||||
|
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(
|
)
|
|
—
|
|
|
(
|
)
|
|
—
|
|
|
(
|
)
|
||||||||
|
Noncontrolling interest dividend
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(
|
)
|
|
(
|
)
|
||||||||
|
Ending Balance at March 31, 2020
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
|
Six months ended March 31, 2019
|
||||||||||||||||||||||||||||||
|
|
Common
Stock |
|
Additional
Paid-in Capital |
|
Retained Earnings
|
|
Treasury Stock
|
|
Accumulated
Other Comprehensive Loss |
|
Total Equity Attributable to
Meritor, Inc. |
|
Noncontrolling
Interests |
|
Total
|
||||||||||||||||
|
Beginning Balance at September 30, 2018
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Comprehensive income
|
—
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Equity based compensation expense
|
—
|
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
||||||||
|
Vesting of equity based awards
|
|
|
|
(
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
||||||||
|
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(
|
)
|
|
—
|
|
|
(
|
)
|
|
—
|
|
|
(
|
)
|
||||||||
|
Noncontrolling interest dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(
|
)
|
|
(
|
)
|
||||||||
|
Ending Balance at March 31, 2019
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||
|
Basic average common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of restricted shares, restricted share units and performance share units
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of convertible notes
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted average common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, 2020
|
||||||||||
|
Primary Geographical Market
|
|
Commercial Truck
|
|
Aftermarket, Industrial and Trailer
|
|
Total
|
||||||
|
U.S.
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Canada
|
|
|
|
|
|
|
|
|
|
|||
|
Mexico
|
|
|
|
|
|
|
|
|
|
|||
|
Total North America
|
|
|
|
|
|
|
|
|
|
|||
|
Sweden
|
|
|
|
|
|
|
|
|
|
|||
|
Italy
|
|
|
|
|
|
|
|
|
|
|||
|
United Kingdom
|
|
|
|
|
|
|
|
|
|
|||
|
Other Europe
|
|
|
|
|
|
|
|
|
|
|||
|
Total Europe
|
|
|
|
|
|
|
|
|
|
|||
|
Brazil
|
|
|
|
|
|
|
|
|
|
|||
|
China
|
|
|
|
|
|
|
|
|
|
|||
|
India
|
|
|
|
|
|
|
|
|
|
|||
|
Other Asia-Pacific
|
|
|
|
|
|
|
|
|
|
|||
|
Total sales
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
Three Months Ended March 31, 2019
|
||||||||||
|
Primary Geographical Market
|
|
Commercial Truck
|
|
Aftermarket, Industrial and Trailer
|
|
Total
|
||||||
|
U.S.
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Canada
|
|
|
|
|
|
|
|
|
|
|||
|
Mexico
|
|
|
|
|
|
|
|
|
|
|||
|
Total North America
|
|
|
|
|
|
|
|
|
|
|||
|
Sweden
|
|
|
|
|
|
|
|
|
|
|||
|
Italy
|
|
|
|
|
|
|
|
|
|
|||
|
United Kingdom
|
|
|
|
|
|
|
|
|
|
|||
|
Other Europe
|
|
|
|
|
|
|
|
|
|
|||
|
Total Europe
|
|
|
|
|
|
|
|
|
|
|||
|
Brazil
|
|
|
|
|
|
|
|
|
|
|||
|
China
|
|
|
|
|
|
|
|
|
|
|||
|
India
|
|
|
|
|
|
|
|
|
|
|||
|
Other Asia-Pacific
|
|
|
|
|
|
|
|
|
|
|||
|
Total sales
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
Six Months Ended March 31, 2020
|
||||||||||
|
Primary Geographical Market
|
|
Commercial Truck
|
|
Aftermarket, Industrial and Trailer
|
|
Total
|
||||||
|
U.S.
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Canada
|
|
|
|
|
|
|
|
|
|
|||
|
Mexico
|
|
|
|
|
|
|
|
|
|
|||
|
Total North America
|
|
|
|
|
|
|
|
|
|
|||
|
Sweden
|
|
|
|
|
|
|
|
|
|
|||
|
Italy
|
|
|
|
|
|
|
|
|
|
|||
|
United Kingdom
|
|
|
|
|
|
|
|
|
|
|||
|
Other Europe
|
|
|
|
|
|
|
|
|
|
|||
|
Total Europe
|
|
|
|
|
|
|
|
|
|
|||
|
Brazil
|
|
|
|
|
|
|
|
|
|
|||
|
China
|
|
|
|
|
|
|
|
|
|
|||
|
India
|
|
|
|
|
|
|
|
|
|
|||
|
Other Asia-Pacific
|
|
|
|
|
|
|
|
|
|
|||
|
Total sales
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
Six Months Ended March 31, 2019
|
||||||||||
|
Primary Geographical Market
|
|
Commercial Truck
|
|
Aftermarket, Industrial and Trailer
|
|
Total
|
||||||
|
U.S.
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Canada
|
|
|
|
|
|
|
|
|
|
|||
|
Mexico
|
|
|
|
|
|
|
|
|
|
|||
|
Total North America
|
|
|
|
|
|
|
|
|
|
|||
|
Sweden
|
|
|
|
|
|
|
|
|
|
|||
|
Italy
|
|
|
|
|
|
|
|
|
|
|||
|
United Kingdom
|
|
|
|
|
|
|
|
|
|
|||
|
Other Europe
|
|
|
|
|
|
|
|
|
|
|||
|
Total Europe
|
|
|
|
|
|
|
|
|
|
|||
|
Brazil
|
|
|
|
|
|
|
|
|
|
|||
|
China
|
|
|
|
|
|
|
|
|
|
|||
|
India
|
|
|
|
|
|
|
|
|
|
|||
|
Other Asia-Pacific
|
|
|
|
|
|
|
|
|
|
|||
|
Total sales
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Three Months Ended March 31, 2020
|
|
Six Months Ended March 31, 2020
|
||||
|
Finance lease costs
|
$
|
|
|
|
$
|
|
|
|
Operating lease costs
|
|
|
|
|
|
||
|
Total lease costs
|
$
|
|
|
|
$
|
|
|
|
|
Classification
|
|
March 31, 2020
|
||
|
Finance lease right-of-use assets
|
Net Property
|
|
$
|
|
|
|
Finance lease liabilities
|
Short-term debt
|
|
|
|
|
|
Finance lease liabilities
|
Long-term debt
|
|
|
|
|
|
|
Classification
|
|
March 31, 2020
|
||
|
Operating lease right-of-use assets
|
Other assets
|
|
$
|
|
|
|
Operating lease liabilities
|
Other current liabilities
|
|
|
|
|
|
Operating lease liabilities
|
Other liabilities
|
|
|
|
|
|
|
Six Months Ended March 31, 2020
|
||
|
Cash paid for amounts included in the measurement of lease liabilities:
|
|
||
|
Operating cash flows from operating leases
|
$
|
|
|
|
Operating cash flows from finance leases
|
|
|
|
|
Financing cash flows from finance leases
|
|
|
|
|
Right-of-use assets obtained in exchange for lease obligations:
|
|
||
|
Operating leases
|
|
|
|
|
Finance leases
|
|
|
|
|
|
March 31, 2020
|
|
|
Weighted-average remaining lease term (years):
|
|
|
|
Operating leases
|
|
|
|
Finance leases
|
|
|
|
Weighted-average discount rate:
|
|
|
|
Operating leases
|
|
%
|
|
Finance leases
|
|
%
|
|
|
Operating Leases
|
|
Finance Leases
|
||||
|
Remainder of 2020
|
$
|
|
|
|
$
|
|
|
|
2021
|
|
|
|
|
|
||
|
2022
|
|
|
|
|
|
||
|
2023
|
|
|
|
|
|
||
|
2024
|
|
|
|
|
|
||
|
Thereafter
|
|
|
|
|
|
||
|
Total lease payments
|
|
|
|
|
|
||
|
Less: Impact of discounting future lease payments
|
(
|
)
|
|
(
|
)
|
||
|
Present value of lease liabilities
|
$
|
|
|
|
$
|
|
|
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
Thereafter
|
|
Total
|
||||||||||||||
|
Lease commitments
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Commercial Truck
|
|
Aftermarket, Industrial and Trailer
|
|
Total
|
||||||
|
Goodwill
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Accumulated impairment losses
|
|
|
|
(
|
)
|
|
(
|
)
|
|||
|
Beginning Balance at September 30, 2019
|
|
|
|
|
|
|
|
|
|||
|
AxleTech measurement period adjustment (see Note 9)
|
|
|
|
|
|
|
|
|
|||
|
Goodwill acquired from acquisition (see Note 9)
|
|
|
|
|
|
|
|
|
|||
|
Foreign currency translation
|
|
|
|
(
|
)
|
|
(
|
)
|
|||
|
Ending Balance at March 31, 2020
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Total
|
||
|
Beginning Balance at September 30, 2019
|
$
|
|
|
|
Activity during the period:
|
|
||
|
Charges to continuing operations
|
|
|
|
|
Cash payments – continuing operations
|
(
|
)
|
|
|
Other
|
(
|
)
|
|
|
Total restructuring reserves at March 31, 2020
|
|
|
|
|
Less: non-current restructuring reserves
|
|
|
|
|
Restructuring reserves – current, at March 31, 2020
|
$
|
|
|
|
|
|
||
|
Balance at September 30, 2018
|
$
|
|
|
|
Activity during the period:
|
|
||
|
Charges to continuing operations
|
(
|
)
|
|
|
Cash payments – continuing operations
|
(
|
)
|
|
|
Total restructuring reserves at March 31, 2019
|
|
|
|
|
Less: non-current restructuring reserves
|
|
|
|
|
Restructuring reserves – current, at March 31, 2019
|
$
|
|
|
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
Sales
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Net income attributable to Meritor, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
January 16, 2020
|
||
|
Purchase price
|
$
|
|
|
|
Investments in TransPower
|
|
|
|
|
|
|
||
|
Assets acquired and liabilities assumed:
|
|
||
|
Cash
|
|
|
|
|
Receivables, net
|
|
|
|
|
Inventories, net
|
|
|
|
|
PP&E
|
|
|
|
|
Accounts payable
|
(
|
)
|
|
|
Other current liabilities
|
(
|
)
|
|
|
Total identifiable net assets acquired
|
|
|
|
|
|
|
||
|
Goodwill and other intangible assets resulting from the acquisition of TransPower
|
|
|
|
|
|
$
|
|
|
|
|
|
Current Expiration
|
|
Total Facility Size as of 3/31/20
|
|
Utilized as of 3/31/20
|
|
Utilized as of 9/30/19
|
||||||||||||||||||
|
|
|
|
|
EUR
|
|
USD
|
|
EUR
|
|
USD
|
|
EUR
|
|
USD
|
||||||||||||
|
On-balance sheet arrangement
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Committed U.S. accounts receivable securitization
(1)
|
|
December 2022
|
|
N/A
|
|
|
$
|
|
|
|
N/A
|
|
|
$
|
|
|
|
N/A
|
|
|
$
|
|
|
|||
|
Total on-balance sheet arrangement:
(1)
|
|
|
|
N/A
|
|
|
$
|
|
|
|
N/A
|
|
|
$
|
|
|
|
N/A
|
|
|
$
|
|
|
|||
|
Off-balance sheet arrangements
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Committed Swedish factoring facility
(2)(3)
|
|
March 2024
|
|
€
|
|
|
|
$
|
|
|
|
€
|
|
|
|
$
|
|
|
|
€
|
|
|
|
$
|
|
|
|
Committed U.S. factoring facility
(2)
|
|
February 2023
|
|
N/A
|
|
|
|
|
|
N/A
|
|
|
|
|
|
N/A
|
|
|
|
|
||||||
|
Uncommitted U.K. factoring facility
|
|
February 2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Uncommitted Italy factoring facility
|
|
June 2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Other uncommitted factoring facilities
(4)
|
|
None
|
|
N/A
|
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Total off-balance sheet arrangements
|
|
|
|
€
|
|
|
|
$
|
|
|
|
€
|
|
|
|
$
|
|
|
|
€
|
|
|
|
$
|
|
|
|
|
March 31,
2020 |
|
September 30,
2019 |
||||
|
Finished goods
|
$
|
|
|
|
$
|
|
|
|
Work in process
|
|
|
|
|
|
||
|
Raw materials, parts and supplies
|
|
|
|
|
|
||
|
Total
|
$
|
|
|
|
$
|
|
|
|
|
March 31,
2020 |
|
September 30,
2019 |
||||
|
Property at cost:
|
|
|
|
||||
|
Land and land improvements
|
$
|
|
|
|
$
|
|
|
|
Buildings
|
|
|
|
|
|
||
|
Machinery and equipment
|
|
|
|
|
|
||
|
Company-owned tooling
|
|
|
|
|
|
||
|
Construction in progress
|
|
|
|
|
|
||
|
Total
|
|
|
|
|
|
||
|
Less: accumulated depreciation
|
(
|
)
|
|
(
|
)
|
||
|
Net property
|
$
|
|
|
|
$
|
|
|
|
|
March 31,
2020 |
|
September 30,
2019 |
||||
|
Investments in non-consolidated joint ventures
|
$
|
|
|
|
$
|
|
|
|
Deferred income tax assets, net
|
|
|
|
|
|
||
|
Prepaid pension costs
|
|
|
|
|
|
||
|
Other
|
|
|
|
|
|
||
|
Other assets
|
$
|
|
|
|
$
|
|
|
|
|
March 31,
2020 |
|
September 30,
2019 |
||||
|
Compensation and benefits
|
$
|
|
|
|
$
|
|
|
|
Product warranties
|
|
|
|
|
|
||
|
Other
|
|
|
|
|
|
||
|
Other current liabilities
|
$
|
|
|
|
$
|
|
|
|
|
Six Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
|
Total product warranties – beginning of period
|
$
|
|
|
|
$
|
|
|
|
Accruals for product warranties
|
|
|
|
|
|
||
|
Payments
|
(
|
)
|
|
(
|
)
|
||
|
Change in estimates and other
|
(
|
)
|
|
(
|
)
|
||
|
Total product warranties – end of period
|
|
|
|
|
|
||
|
Less: Non-current product warranties
|
(
|
)
|
|
(
|
)
|
||
|
Product warranties – current
|
$
|
|
|
|
$
|
|
|
|
|
March 31,
2020 |
|
September 30,
2019 |
||||
|
Asbestos-related liabilities (see Note 20)
|
$
|
|
|
|
$
|
|
|
|
Liabilities for uncertain tax positions
|
|
|
|
|
|
||
|
Product warranties (see Note 15)
|
|
|
|
|
|
||
|
Other
|
|
|
|
|
|
||
|
Other liabilities
|
$
|
|
|
|
$
|
|
|
|
|
March 31,
2020 |
|
September 30,
2019 |
||||
|
3.25 percent convertible notes due 2037
|
$
|
|
|
|
$
|
|
|
|
7.875 percent convertible notes due 2026
|
|
|
|
|
|
||
|
Term loan due 2024
|
|
|
|
|
|
||
|
6.25 percent notes due 2024
|
|
|
|
|
|
||
|
Financing lease obligation
|
|
|
|
|
|
||
|
Borrowings and securitization
|
|
|
|
|
|
||
|
Unamortized discount on convertible notes
|
(
|
)
|
|
(
|
)
|
||
|
Subtotal
|
|
|
|
|
|
||
|
Less: current maturities
|
(
|
)
|
|
(
|
)
|
||
|
Long-term debt
|
$
|
|
|
|
$
|
|
|
|
|
March 31, 2020
|
|
September 30, 2019
|
||||||||||||
|
|
Carrying
Value
|
|
Fair
Value
|
|
Carrying
Value
|
|
Fair
Value
|
||||||||
|
Cash and cash equivalents
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Short-term debt
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Long-term debt
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Foreign exchange forward contracts (other assets)
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Foreign exchange forward contracts (other liabilities)
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Cross-currency swaps (other assets)
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Cross-currency swaps (other liabilities)
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
March 31, 2020
|
|
September 30, 2019
|
||||||||||||||
|
|
Gross
Amounts Recognized |
|
Gross Amounts
Offset |
|
Net Amounts
Reported |
|
Gross
Amounts Recognized |
|
Gross Amounts
Offset |
|
Net Amounts
Reported |
||||||
|
Derivative Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Foreign exchange forward contracts
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross-currency swaps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Foreign exchange forward contracts
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross-currency swaps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
•
|
Level 1 inputs use quoted prices in active markets for identical instruments.
|
|
•
|
Level 2 inputs use other inputs that are observable, either directly or indirectly. These Level 2 inputs include quoted prices for similar instruments in active markets and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals.
|
|
•
|
Level 3 inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related instrument.
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
|
Cash and cash equivalents
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Short-term debt
|
|
|
|
|
|
|
|
|
|||
|
Long-term debt
|
|
|
|
|
|
|
|
|
|||
|
Foreign exchange forward contracts (other assets)
|
|
|
|
|
|
|
|
|
|||
|
Foreign exchange forward contracts (other liabilities)
|
|
|
|
|
|
|
|
|
|||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
|
Cash and cash equivalents
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Short-term debt
|
|
|
|
|
|
|
|
|
|||
|
Long-term debt
|
|
|
|
|
|
|
|
|
|||
|
Cross-currency swaps (other assets)
|
|
|
|
|
|
|
|
|
|||
|
Cross-currency swaps (other liabilities)
|
|
|
|
|
|
|
|
|
|||
|
|
March 31,
2020 |
|
September 30,
2019 |
||||
|
Retiree medical liability
|
$
|
|
|
|
$
|
|
|
|
Pension liability
|
|
|
|
|
|
||
|
Other
|
|
|
|
|
|
||
|
Subtotal
|
|
|
|
|
|
||
|
Less: current portion (included in compensation and benefits, Note 15)
|
(
|
)
|
|
(
|
)
|
||
|
Retirement benefits
|
$
|
|
|
|
$
|
|
|
|
|
2020
|
|
2019
|
||||||||||||
|
|
Pension
|
|
Retiree Medical
|
|
Pension
|
|
Retiree Medical
|
||||||||
|
Interest cost
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Assumed return on plan assets
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Amortization of prior service benefit
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
||||
|
Recognized actuarial loss
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total income
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
|
2020
|
|
2019
|
||||||||||||
|
|
Pension
|
|
Retiree Medical
|
|
Pension
|
|
Retiree Medical
|
||||||||
|
Interest cost
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Assumed return on plan assets
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Amortization of prior service benefit
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
||||
|
Recognized actuarial loss
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total income
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
|
Superfund Sites
|
|
Non-Superfund Sites
|
|
Total
|
||||||
|
Beginning Balance at September 30, 2019
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Payments and other
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|||
|
Accruals
|
|
|
|
|
|
|
|
|
|||
|
Ending Balance at March 31, 2020
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Foreign Currency Translation
|
|
Employee Benefit Related Adjustments
|
|
Unrealized Income (Loss) on cash flow hedges
|
|
Total
|
||||||||
|
Balance at December 31, 2019
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
(
|
)
|
|
Other comprehensive income before reclassification
|
(
|
)
|
|
|
|
|
(
|
)
|
|
(
|
)
|
||||
|
Amounts reclassified from accumulated other comprehensive loss
|
|
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Net current-period other comprehensive income
|
(
|
)
|
|
|
|
|
(
|
)
|
|
(
|
)
|
||||
|
Balance at March 31, 2020
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
Details about Accumulated Other Comprehensive Income Components
|
|
Amount Reclassified from Accumulated Other Comprehensive Income
|
|
Affected Line Item in the Consolidated Statement of Operations
|
|||
|
Employee Benefit Related Adjustment
|
|
|
|
|
|||
|
Prior service benefit
|
|
$
|
(
|
)
|
|
(a)
|
|
|
Actuarial losses
|
|
|
|
|
(a)
|
||
|
|
|
|
|
|
Total before tax
|
||
|
|
|
|
|
|
Tax benefit
|
||
|
Total reclassifications for the period
|
|
$
|
|
|
|
Net of tax
|
|
|
(a)
These accumulated other comprehensive income components are included in the computation of net periodic pension and retiree medical expense (see Note 19 for additional details), which is recorded in other income (expense), net.
|
|||||||
|
|
Foreign Currency Translation
|
|
Employee Benefit Related Adjustments
|
|
Unrealized Income (Loss) on cash flow hedges
|
|
Total
|
||||||||
|
Balance at December 31, 2018
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
(
|
)
|
|
Other comprehensive income before reclassification
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Amounts reclassified from accumulated other comprehensive loss
|
|
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Net current-period other comprehensive income
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
Balance at March 31, 2019
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
(
|
)
|
|
Details about Accumulated Other Comprehensive Income Components
|
|
Amount Reclassified from Accumulated Other Comprehensive Income
|
|
Affected Line Item in the Consolidated Statement of Operations
|
|||
|
Employee Benefit Related Adjustment
|
|
|
|
|
|||
|
Prior service benefit
|
|
$
|
(
|
)
|
|
(b)
|
|
|
Actuarial losses
|
|
|
|
|
(b)
|
||
|
|
|
|
|
|
Total before tax
|
||
|
|
|
|
|
|
Tax benefit
|
||
|
Total reclassifications for the period
|
|
$
|
|
|
|
Net of tax
|
|
|
|
|
|
|
|
|||
|
(b)
These accumulated other comprehensive income components are included in the computation of net periodic pension and retiree medical expense (see Note 19 for additional details), which is recorded in other income (expense), net.
|
|||||||
|
|
Foreign Currency Translation
|
|
Employee Benefit Related Adjustments
|
|
Unrealized Income (Loss) on cash flow hedges
|
|
Total
|
||||||||
|
Balance at September 30, 2019
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
Other comprehensive income before reclassification
|
(
|
)
|
|
|
|
|
(
|
)
|
|
(
|
)
|
||||
|
Amounts reclassified from accumulated other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Net current-period other comprehensive income
|
(
|
)
|
|
|
|
|
(
|
)
|
|
(
|
)
|
||||
|
Balance at March 31, 2020
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
Details about Accumulated Other Comprehensive Income Components
|
|
Amount Reclassified from Accumulated Other Comprehensive Income
|
|
Affected Line Item in the Consolidated Statement of Operations
|
|||
|
Employee Benefit Related Adjustment
|
|
|
|
|
|||
|
Prior service benefit
|
|
$
|
(
|
)
|
|
(a)
|
|
|
Actuarial losses
|
|
|
|
|
(a)
|
||
|
|
|
|
|
|
Total before tax
|
||
|
|
|
|
|
|
Tax benefit
|
||
|
Total reclassifications for the period
|
|
$
|
|
|
|
Net of tax
|
|
|
(a)
These accumulated other comprehensive income components are included in the computation of net periodic pension and retiree medical expense (see Note 19 for additional details), which is recorded in other income (expense), net.
|
|||||||
|
|
Foreign Currency Translation
|
|
Employee Benefit Related Adjustments
|
|
Unrealized Income (Loss) on cash flow hedges
|
|
Total
|
||||||||
|
Balance at September 30, 2018
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
(
|
)
|
|
Other comprehensive income before reclassification
|
|
|
|
(
|
)
|
|
|
|
|
|
|
||||
|
Amounts reclassified from accumulated other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Net current-period other comprehensive income
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Balance at March 31, 2019
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
(
|
)
|
|
Details about Accumulated Other Comprehensive Income Components
|
|
Amount Reclassified from Accumulated Other Comprehensive Income
|
|
Affected Line Item in the Consolidated Statement of Operations
|
|||
|
Employee Benefit Related Adjustment
|
|
|
|
|
|||
|
Prior service benefit
|
|
$
|
(
|
)
|
|
(b)
|
|
|
Actuarial losses
|
|
|
|
|
(b)
|
||
|
|
|
|
|
|
Total before tax
|
||
|
|
|
|
|
|
Tax benefit
|
||
|
Total reclassifications for the period
|
|
$
|
|
|
|
Net of tax
|
|
|
|
|
|
|
|
|||
|
(b)
These accumulated other comprehensive income components are included in the computation of net periodic pension and retiree medical expense (see Note 19 for additional details), which is recorded in other income (expense), net.
|
|||||||
|
•
|
The
Commercial Truck
segment supplies drivetrain systems and components, including axles, drivelines and braking and suspension systems, primarily for medium- and heavy-duty trucks and other applications in North America, South America, Europe and Asia Pacific. This segment also includes the company's aftermarket businesses in Asia Pacific and South America.
|
|
•
|
The
Aftermarket, Industrial and Trailer
segment supplies axles, brakes, drivelines, suspension parts and other replacement parts to commercial vehicle and industrial aftermarket customers, primarily in North America and Europe. In addition, this segment supplies drivetrain systems and certain components, including axles, drivelines, brakes and suspension systems for military, construction, bus and coach, fire and emergency and other applications in North America and Europe. It also supplies a variety of undercarriage products and systems for trailer applications in North America.
|
|
|
Commercial Truck
|
|
Aftermarket,
Industrial and Trailer |
|
Eliminations
|
|
Total
|
||||||||
|
Three Months Ended March 31, 2020
|
|
|
|
|
|
|
|
||||||||
|
External Sales
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Intersegment Sales
|
|
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Total Sales
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
Three Months Ended March 31, 2019
|
|
|
|
|
|
|
|
||||||||
|
External Sales
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Intersegment Sales
|
|
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Total Sales
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
Commercial Truck
|
|
Aftermarket,
Industrial and Trailer
|
|
Eliminations
|
|
Total
|
||||||||
|
Six Months Ended March 31, 2020
|
|
|
|
|
|
|
|
||||||||
|
External Sales
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Intersegment Sales
|
|
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Total Sales
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
Six Months Ended March 31, 2019
|
|
|
|
|
|
|
|
||||||||
|
External Sales
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Intersegment Sales
|
|
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Total Sales
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
Segment adjusted EBITDA:
|
|
|
|
|
|
|
|
||||||||
|
Commercial Truck
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Aftermarket, Industrial and Trailer
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Segment adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Unallocated legacy and corporate expense, net
(1)
|
|
|
|
(
|
)
|
|
|
|
|
|
|
||||
|
Interest expense, net
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
||||
|
Provision for income taxes
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
||||
|
Depreciation and amortization
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
||||
|
Noncontrolling interests
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
||||
|
Loss on sale of receivables
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
||||
|
Restructuring
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Transaction costs
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|
||||
|
Income from WABCO distribution termination
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Asbestos related liability remeasurement
(2)
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Income from continuing operations attributable to Meritor, Inc.
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
(1)
|
Unallocated legacy and corporate income (expense), net represents items that are not directly related to the company's business segments. These items primarily include asbestos-related charges and settlements, pension and retiree medical costs associated with sold businesses, and other legacy costs for environmental and product liability.
|
|
(2)
|
The six months ended March 31, 2019 includes
$
|
|
|
March 31,
2020 |
|
September 30,
2019 |
||||
|
Segment Assets:
|
|
|
|
||||
|
Commercial Truck
|
$
|
|
|
|
$
|
|
|
|
Aftermarket, Industrial and Trailer
|
|
|
|
|
|
||
|
Total segment assets
|
|
|
|
|
|
||
|
Corporate
(1)
|
|
|
|
|
|
||
|
Less: Accounts receivable sold under off-balance sheet factoring programs
(2)
|
(
|
)
|
|
(
|
)
|
||
|
Total assets
|
$
|
|
|
|
$
|
|
|
|
(1)
|
Corporate assets consist primarily of cash, deferred income taxes and prepaid pension costs.
|
|
(2)
|
|
|
|
Three Months Ended March 31, 2020
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors
|
|
Elims
|
|
Consolidated
|
||||||||||
|
Sales
|
|
|
|
|
|
|
|
|
|
||||||||||
|
External
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Subsidiaries
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Total sales
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Cost of sales
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
GROSS PROFIT
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Selling, general and administrative
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Income from WABCO distribution termination
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other operating expense, net
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
OPERATING INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other income (expense), net
|
|
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
|
|
|||||
|
Equity in earnings of affiliates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Interest income (expense), net
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
INCOME BEFORE INCOME TAXES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Provision for income taxes
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Equity income from continuing operations of subsidiaries
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
INCOME FROM CONTINUING OPERATIONS
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
INCOME FROM DISCONTINUED OPERATIONS, net of tax
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
NET INCOME
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Less: Net income attributable to noncontrolling interests
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
NET INCOME ATTRIBUTABLE TO MERITOR, INC.
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
Three Months Ended March 31, 2020
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors |
|
Elims
|
|
Consolidated
|
||||||||||
|
Net income
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
Other comprehensive loss, net of tax
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Total comprehensive income (loss)
|
|
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
|
|
|||||
|
Less: Comprehensive income attributable to
noncontrolling interests |
|
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Comprehensive income (loss) attributable to Meritor, Inc.
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
|
Three Months Ended March 31, 2019
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors
|
|
Elims
|
|
Consolidated
|
||||||||||
|
Sales
|
|
|
|
|
|
|
|
|
|
||||||||||
|
External
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Subsidiaries
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Total sales
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Cost of sales
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
GROSS PROFIT
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Selling, general and administrative
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Other operating income, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
OPERATING INCOME (LOSS)
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other income (expense), net
|
|
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
|
|
|||||
|
Equity in earnings of affiliates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Interest income (expense), net
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
INCOME (LOSS) BEFORE INCOME TAXES
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Benefit (provision) for income taxes
|
|
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Equity income from continuing operations of subsidiaries
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
INCOME FROM CONTINUING OPERATIONS
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
LOSS FROM DISCONTINUED OPERATIONS, net of tax
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
NET INCOME
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Less: Net income attributable to noncontrolling interests
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
NET INCOME ATTRIBUTABLE TO MERITOR, INC.
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
Three Months Ended March 31, 2019
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors
|
|
Elims
|
|
Consolidated
|
||||||||||
|
Net income
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
Other comprehensive income, net of tax
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Less: Comprehensive income attributable to noncontrolling interests
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Comprehensive income attributable to Meritor, Inc.
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
Six Months Ended March 31, 2020
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors
|
|
Elims
|
|
Consolidated
|
||||||||||
|
Sales
|
|
|
|
|
|
|
|
|
|
||||||||||
|
External
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Subsidiaries
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Total sales
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Cost of sales
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
GROSS PROFIT
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Selling, general and administrative
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Income from WABCO distribution termination
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other operating expense, net
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
OPERATING INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other income (expense), net
|
|
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
|
|
|||||
|
Equity in earnings of affiliates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Interest income (expense), net
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
INCOME BEFORE INCOME TAXES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Provision for income taxes
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Equity income from continuing operations of subsidiaries
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
INCOME FROM CONTINUING OPERATIONS
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
INCOME FROM DISCONTINUED OPERATIONS, net of tax
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
NET INCOME
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Less: Net income attributable to noncontrolling interests
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
NET INCOME ATTRIBUTABLE TO MERITOR, INC.
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
Six Months Ended March 31, 2020
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors |
|
Elims
|
|
Consolidated
|
||||||||||
|
Net income
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
Other comprehensive loss, net of tax
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Less: Comprehensive income attributable to
noncontrolling interests |
|
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Comprehensive income attributable to Meritor, Inc.
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
Six Months Ended March 31, 2019
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors
|
|
Elims
|
|
Consolidated
|
||||||||||
|
Sales
|
|
|
|
|
|
|
|
|
|
||||||||||
|
External
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Subsidiaries
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Total sales
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Cost of sales
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
GROSS PROFIT
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Selling, general and administrative
|
(
|
)
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
Other operating income, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
OPERATING INCOME (LOSS)
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other income (expense), net
|
|
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
|
|
|||||
|
Equity in earnings of affiliates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Interest income (expense), net
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
INCOME (LOSS) BEFORE INCOME TAXES
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Benefit (provision) for income taxes
|
|
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Equity income from continuing operations of subsidiaries
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
INCOME FROM CONTINUING OPERATIONS
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
LOSS FROM DISCONTINUED OPERATIONS, net of tax
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
NET INCOME
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Less: Net income attributable to noncontrolling interests
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
NET INCOME ATTRIBUTABLE TO MERITOR, INC.
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
Six Months Ended March 31, 2019
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors |
|
Elims
|
|
Consolidated
|
||||||||||
|
Net income
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
Other comprehensive income (loss), net of tax
|
|
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
|
|
|||||
|
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
Less: Comprehensive income attributable to
noncontrolling interests |
|
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Comprehensive income attributable to Meritor, Inc.
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
March 31, 2020
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors
|
|
Elims
|
|
Consolidated
|
||||||||||
|
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Cash and cash equivalents
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Receivables trade and other, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Inventories
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other current assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
TOTAL CURRENT ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
NET PROPERTY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
GOODWILL
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
OTHER ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
INVESTMENTS IN SUBSIDIARIES
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
TOTAL ASSETS
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Short-term debt
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Accounts and notes payable
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
TOTAL CURRENT LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
LONG-TERM DEBT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
RETIREMENT BENEFITS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
INTERCOMPANY PAYABLE (RECEIVABLE)
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|||||
|
OTHER LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
EQUITY ATTRIBUTABLE TO MERITOR, INC.
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
NONCONTROLLING INTERESTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
TOTAL LIABILITIES AND EQUITY
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
September 30, 2019
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors
|
|
Elims
|
|
Consolidated
|
||||||||||
|
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Cash and cash equivalents
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Receivables trade and other, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Inventories
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other current assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
TOTAL CURRENT ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
NET PROPERTY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
GOODWILL
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
OTHER ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
INVESTMENTS IN SUBSIDIARIES
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
TOTAL ASSETS
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Short-term debt
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Accounts and notes payable
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
TOTAL CURRENT LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
LONG-TERM DEBT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
RETIREMENT BENEFITS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
INTERCOMPANY PAYABLE (RECEIVABLE)
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|||||
|
OTHER LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
EQUITY ATTRIBUTABLE TO MERITOR, INC.
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|||||
|
NONCONTROLLING INTERESTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
TOTAL LIABILITIES AND EQUITY
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
|
Six Months Ended March 31, 2020
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors
|
|
Elims
|
|
Consolidated
|
||||||||||
|
CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Capital expenditures
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Cash paid for acquisition of TransPower, net of cash acquired
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
Other investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
CASH USED FOR INVESTING ACTIVITIES
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Securitization
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Borrowings against revolving line of credit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Term loan payments
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
Repurchase of common stock
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
Intercompany advances
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Other financing activities
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
EFFECT OF CHANGES IN FOREIGN CURRENCY
EXCHANGE RATES ON CASH AND CASH
EQUIVALENTS
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
CHANGE IN CASH AND CASH EQUIVALENTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
CASH AND CASH EQUIVALENTS AT END OF
PERIOD
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Six Months Ended March 31, 2019
|
||||||||||||||||||
|
|
Parent
|
|
Guarantors
|
|
Non-
Guarantors
|
|
Elims
|
|
Consolidated
|
||||||||||
|
CASH PROVIDED BY (USED FOR)
OPERATING ACTIVITIES
|
$
|
|
|
|
$
|
|
|
|
$
|
(
|
)
|
|
$
|
|
|
|
$
|
|
|
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Capital expenditures
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
Cash paid for investment in TransPower
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
CASH USED FOR INVESTING ACTIVITIES
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Securitization
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Redemption of notes
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
Repurchase of common stock
|
(
|
)
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
Intercompany advances
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|||||
|
Other financing activities
|
|
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES
|
(
|
)
|
|
(
|
)
|
|
|
|
|
|
|
|
(
|
)
|
|||||
|
EFFECT OF CHANGES IN FOREIGN CURRENCY
EXCHANGE RATES ON CASH AND CASH
EQUIVALENTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
CHANGE IN CASH AND CASH EQUIVALENTS
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||
|
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
CASH AND CASH EQUIVALENTS AT END OF
PERIOD
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
Three Months Ended March 31,
|
|
Percent
|
|
Six Months Ended March 31,
|
|
Percent
|
||||||||||
|
|
2020
|
|
2019
|
|
Change
|
|
2020
|
|
2019
|
|
Change
|
||||||
|
Estimated Commercial Truck production (in thousands):
|
|
|
|
|
|
|
|||||||||||
|
North America, Heavy-Duty Trucks
|
61
|
|
|
89
|
|
|
(31
|
)%
|
|
130
|
|
|
173
|
|
|
(25
|
)%
|
|
North America, Medium-Duty Trucks
|
60
|
|
|
70
|
|
|
(14
|
)%
|
|
120
|
|
|
135
|
|
|
(11
|
)%
|
|
North America, Trailers
|
55
|
|
|
78
|
|
|
(29
|
)%
|
|
135
|
|
|
165
|
|
|
(18
|
)%
|
|
Western Europe, Heavy- and Medium-Duty Trucks
|
88
|
|
|
127
|
|
|
(31
|
)%
|
|
197
|
|
|
257
|
|
|
(23
|
)%
|
|
South America, Heavy- and Medium-Duty Trucks
|
22
|
|
|
23
|
|
|
(4
|
)%
|
|
52
|
|
|
50
|
|
|
4
|
%
|
|
India, Heavy- and Medium-Duty Trucks
|
66
|
|
|
118
|
|
|
(44
|
)%
|
|
114
|
|
|
233
|
|
|
(51
|
)%
|
|
•
|
Uncertainty regarding the duration and severity of the COVID-19 pandemic and its effects on public health, the global economy, financial markets and operations, including additional expense related to enhancing safety measures for our employees;
|
|
•
|
Uncertainty around the global economic outlook;
|
|
•
|
Volatility in price and availability of steel, components, transportation costs and other commodities, including energy;
|
|
•
|
Potential for disruptions in the financial markets and their impact on the availability and cost of credit;
|
|
•
|
Impact of currency exchange rate volatility; and
|
|
•
|
Consolidation and globalization of OEMs and their suppliers.
|
|
•
|
Significant contract awards or losses of existing contracts or failure to negotiate acceptable terms in contract renewals;
|
|
•
|
Ability to successfully execute and implement strategic initiatives, including the ability to launch a significant number of new products, potential product quality issues, and obtain new business;
|
|
•
|
Ability to manage possible adverse effects on European markets or our European operations, or financing arrangements related thereto, following the United Kingdom's decision to exit the European Union, or in the event one or more other countries exit the European monetary union;
|
|
•
|
Ability to further implement planned productivity, cost reduction and other margin improvement initiatives;
|
|
•
|
Ability to work with our customers to manage rapidly changing production volumes, including in the event of production interruptions affecting us, our customers or our suppliers;
|
|
•
|
Competitively driven price reductions to our customers or potential price increases from our suppliers;
|
|
•
|
Additional restructuring actions and the timing and recognition of restructuring charges, including any actions associated with prolonged softness in markets in which we operate;
|
|
•
|
Higher-than-planned warranty expenses, including the outcome of known or potential recall campaigns;
|
|
•
|
Uncertainties of asbestos claim, environmental and other legal proceedings, the long-term solvency of our insurance carriers and the potential for higher-than-anticipated costs resulting from environmental liabilities, including those related to site remediation;
|
|
•
|
Significant pension costs; and
|
|
•
|
Restrictive government actions (such as restrictions on transfer of funds and trade protection measures, including import and export duties, quotas and customs duties and tariffs).
|
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
Income from continuing operations attributable to the company
|
$
|
240
|
|
|
$
|
73
|
|
|
$
|
279
|
|
|
$
|
163
|
|
|
Restructuring
|
10
|
|
|
(1
|
)
|
|
15
|
|
|
(1
|
)
|
||||
|
Non-cash tax expense
(1)
|
8
|
|
|
16
|
|
|
17
|
|
|
27
|
|
||||
|
U.S. tax reform impacts
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
||||
|
Asbestos related liability remeasurement
(3)
|
—
|
|
|
—
|
|
|
—
|
|
|
(31
|
)
|
||||
|
Income from WABCO distribution termination
|
(265
|
)
|
|
—
|
|
|
(265
|
)
|
|
—
|
|
||||
|
Income tax expense
(4)
|
58
|
|
|
—
|
|
|
57
|
|
|
6
|
|
||||
|
Transaction costs
(5)
|
5
|
|
|
—
|
|
|
5
|
|
|
—
|
|
||||
|
Adjusted income from continuing operations attributable to the company
|
$
|
56
|
|
|
$
|
88
|
|
|
$
|
108
|
|
|
$
|
157
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Diluted earnings per share from continuing operations
|
$
|
3.19
|
|
|
$
|
0.85
|
|
|
$
|
3.58
|
|
|
$
|
1.88
|
|
|
Impact of adjustments on diluted earnings per share
|
(2.45
|
)
|
|
0.18
|
|
|
(2.20
|
)
|
|
(0.07
|
)
|
||||
|
Adjusted diluted earnings per share from continuing operations
|
$
|
0.74
|
|
|
$
|
1.03
|
|
|
$
|
1.38
|
|
|
$
|
1.81
|
|
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
Cash provided by operating activities
|
$
|
309
|
|
|
$
|
40
|
|
|
$
|
290
|
|
|
$
|
51
|
|
|
Capital expenditures
|
(17
|
)
|
|
(21
|
)
|
|
(33
|
)
|
|
(44
|
)
|
||||
|
Free cash flow
|
$
|
292
|
|
|
$
|
19
|
|
|
$
|
257
|
|
|
$
|
7
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Free cash flow conversion
(1)
|
521
|
%
|
|
22
|
%
|
|
238
|
%
|
|
4
|
%
|
||||
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
Net income attributable to Meritor, Inc.
|
$
|
241
|
|
|
$
|
72
|
|
|
$
|
280
|
|
|
$
|
162
|
|
|
Loss (income) from discontinued operations, net of tax, attributable to Meritor, Inc.
|
(1
|
)
|
|
1
|
|
|
(1
|
)
|
|
1
|
|
||||
|
Income from continuing operations, net of tax, attributable to Meritor, Inc.
|
$
|
240
|
|
|
$
|
73
|
|
|
$
|
279
|
|
|
$
|
163
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Interest expense, net
|
16
|
|
|
15
|
|
|
30
|
|
|
29
|
|
||||
|
Provision for income taxes
|
73
|
|
|
27
|
|
|
86
|
|
|
48
|
|
||||
|
Depreciation and amortization
|
26
|
|
|
21
|
|
|
50
|
|
|
43
|
|
||||
|
Noncontrolling interests
|
1
|
|
|
2
|
|
|
3
|
|
|
4
|
|
||||
|
Loss on sale of receivables
|
1
|
|
|
2
|
|
|
2
|
|
|
3
|
|
||||
|
Asbestos related liability remeasurement
|
—
|
|
|
—
|
|
|
—
|
|
|
(31
|
)
|
||||
|
Restructuring
|
10
|
|
|
(1
|
)
|
|
15
|
|
|
(1
|
)
|
||||
|
Transaction costs
|
5
|
|
|
—
|
|
|
5
|
|
|
—
|
|
||||
|
Income from WABCO distribution termination
|
(265
|
)
|
|
—
|
|
|
(265
|
)
|
|
—
|
|
||||
|
Adjusted EBITDA
|
$
|
107
|
|
|
$
|
139
|
|
|
$
|
205
|
|
|
$
|
258
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Adjusted EBITDA margin
(1)
|
12.3
|
%
|
|
12.0
|
%
|
|
11.6
|
%
|
|
11.8
|
%
|
||||
|
|
|
|
|
|
|
|
|
||||||||
|
Unallocated legacy and corporate expense (income), net
(2)
|
(3
|
)
|
|
1
|
|
|
(5
|
)
|
|
(1
|
)
|
||||
|
Segment adjusted EBITDA
|
$
|
104
|
|
|
$
|
140
|
|
|
$
|
200
|
|
|
$
|
257
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Commercial Truck
|
|
|
|
|
|
|
|
||||||||
|
Segment adjusted EBITDA
|
$
|
55
|
|
|
$
|
88
|
|
|
$
|
111
|
|
|
$
|
165
|
|
|
Segment adjusted EBITDA margin
(3)
|
9.4
|
%
|
|
10.0
|
%
|
|
9.2
|
%
|
|
10.0
|
%
|
||||
|
|
|
|
|
|
|
|
|
||||||||
|
Aftermarket, Industrial and Trailer
|
|
|
|
|
|
|
|
||||||||
|
Segment adjusted EBITDA
|
$
|
49
|
|
|
$
|
52
|
|
|
$
|
89
|
|
|
$
|
92
|
|
|
Segment adjusted EBITDA margin
(3)
|
15.4
|
%
|
|
15.8
|
%
|
|
14.0
|
%
|
|
14.6
|
%
|
||||
|
|
Three Months Ended March 31,
|
|
|
|
|
|
Dollar Change Due To
|
|||||||||||||||
|
|
2020
|
|
2019
|
|
Dollar
Change
|
|
%
Change
|
|
Currency
|
|
Volume/ Other
|
|||||||||||
|
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Commercial Truck
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
North America
|
$
|
305
|
|
|
$
|
463
|
|
|
$
|
(158
|
)
|
|
(34
|
)%
|
|
$
|
—
|
|
|
$
|
(158
|
)
|
|
Europe
|
140
|
|
|
181
|
|
|
(41
|
)
|
|
(23
|
)%
|
|
(5
|
)
|
|
(36
|
)
|
|||||
|
South America
|
50
|
|
|
63
|
|
|
(13
|
)
|
|
(21
|
)%
|
|
(9
|
)
|
|
(4
|
)
|
|||||
|
China
|
26
|
|
|
44
|
|
|
(18
|
)
|
|
(41
|
)%
|
|
(1
|
)
|
|
(17
|
)
|
|||||
|
India
|
22
|
|
|
62
|
|
|
(40
|
)
|
|
(65
|
)%
|
|
—
|
|
|
(40
|
)
|
|||||
|
Other
|
14
|
|
|
24
|
|
|
(10
|
)
|
|
(42
|
)%
|
|
—
|
|
|
(10
|
)
|
|||||
|
Total External Sales
|
$
|
557
|
|
|
$
|
837
|
|
|
$
|
(280
|
)
|
|
(33
|
)%
|
|
$
|
(15
|
)
|
|
$
|
(265
|
)
|
|
Intersegment Sales
|
31
|
|
|
39
|
|
|
(8
|
)
|
|
(21
|
)%
|
|
(2
|
)
|
|
(6
|
)
|
|||||
|
Total Sales
|
$
|
588
|
|
|
$
|
876
|
|
|
$
|
(288
|
)
|
|
(33
|
)%
|
|
$
|
(17
|
)
|
|
$
|
(271
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Aftermarket, Industrial and Trailer
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
North America
|
$
|
272
|
|
|
$
|
293
|
|
|
$
|
(21
|
)
|
|
(7
|
)%
|
|
$
|
—
|
|
|
$
|
(21
|
)
|
|
Europe
|
42
|
|
|
26
|
|
|
16
|
|
|
62
|
%
|
|
(2
|
)
|
|
18
|
|
|||||
|
Total External Sales
|
$
|
314
|
|
|
$
|
319
|
|
|
$
|
(5
|
)
|
|
(2
|
)%
|
|
$
|
(2
|
)
|
|
$
|
(3
|
)
|
|
Intersegment Sales
|
5
|
|
|
10
|
|
|
(5
|
)
|
|
(50
|
)%
|
|
(1
|
)
|
|
(4
|
)
|
|||||
|
Total Sales
|
$
|
319
|
|
|
$
|
329
|
|
|
$
|
(10
|
)
|
|
(3
|
)%
|
|
$
|
(3
|
)
|
|
$
|
(7
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Total External Sales
|
$
|
871
|
|
|
$
|
1,156
|
|
|
$
|
(285
|
)
|
|
(25
|
)%
|
|
$
|
(17
|
)
|
|
$
|
(268
|
)
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|||||||||
|
|
2020
|
|
2019
|
|
Dollar
Change
|
|
%
Change
|
|||||||
|
Sales
|
$
|
871
|
|
|
$
|
1,156
|
|
|
$
|
(285
|
)
|
|
(25
|
)%
|
|
Cost of sales
|
(757
|
)
|
|
(982
|
)
|
|
225
|
|
|
23
|
%
|
|||
|
GROSS PROFIT
|
114
|
|
|
174
|
|
|
(60
|
)
|
|
(34
|
)%
|
|||
|
Selling, general and administrative
|
(59
|
)
|
|
(73
|
)
|
|
14
|
|
|
19
|
%
|
|||
|
Income from WABCO distribution termination
|
265
|
|
|
—
|
|
|
265
|
|
|
N/A
|
|
|||
|
Other operating income (expense), net
|
(10
|
)
|
|
1
|
|
|
(11
|
)
|
|
(1,100
|
)%
|
|||
|
Other income, net
|
14
|
|
|
9
|
|
|
5
|
|
|
56
|
%
|
|||
|
Equity in earnings of affiliates
|
6
|
|
|
6
|
|
|
—
|
|
|
—
|
%
|
|||
|
Interest expense, net
|
(16
|
)
|
|
(15
|
)
|
|
(1
|
)
|
|
(7
|
)%
|
|||
|
INCOME BEFORE INCOME TAXES
|
314
|
|
|
102
|
|
|
212
|
|
|
208
|
%
|
|||
|
Provision for income taxes
|
(73
|
)
|
|
(27
|
)
|
|
(46
|
)
|
|
(170
|
)%
|
|||
|
INCOME FROM CONTINUING OPERATIONS
|
241
|
|
|
75
|
|
|
166
|
|
|
221
|
%
|
|||
|
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, net of tax
|
1
|
|
|
(1
|
)
|
|
2
|
|
|
(200
|
)%
|
|||
|
NET INCOME
|
242
|
|
|
74
|
|
|
168
|
|
|
227
|
%
|
|||
|
Less: Net income attributable to noncontrolling interests
|
(1
|
)
|
|
(2
|
)
|
|
1
|
|
|
(50
|
)%
|
|||
|
NET INCOME ATTRIBUTABLE TO MERITOR, INC.
|
$
|
241
|
|
|
$
|
72
|
|
|
$
|
169
|
|
|
235
|
%
|
|
|
Segment adjusted EBITDA
|
|
Segment adjusted EBITDA margins
|
|||||||||||||||||
|
|
Three Months Ended March 31,
|
|
|
|
Three Months Ended March 31,
|
|
|
|||||||||||||
|
|
2020
|
|
2019
|
|
Change
|
|
2020
|
|
2019
|
|
Change
|
|||||||||
|
Commercial Truck
|
$
|
55
|
|
|
$
|
88
|
|
|
$
|
(33
|
)
|
|
9.4
|
%
|
|
10.0
|
%
|
|
(0.6
|
) pts
|
|
Aftermarket, Industrial and Trailer
|
49
|
|
|
52
|
|
|
(3
|
)
|
|
15.4
|
%
|
|
15.8
|
%
|
|
(0.4
|
) pts
|
|||
|
Segment adjusted EBITDA
|
$
|
104
|
|
|
$
|
140
|
|
|
$
|
(36
|
)
|
|
11.9
|
%
|
|
12.1
|
%
|
|
(0.2
|
) pts
|
|
|
Commercial Truck
|
|
Aftermarket, Industrial and Trailer
|
|
TOTAL
|
||||||
|
Segment adjusted EBITDA– Quarter ended March 31, 2019
|
$
|
88
|
|
|
$
|
52
|
|
|
$
|
140
|
|
|
Impact of foreign currency exchange rates
|
(4
|
)
|
|
(1
|
)
|
|
(5
|
)
|
|||
|
Volume, mix, pricing and other
|
(29
|
)
|
|
(2
|
)
|
|
(31
|
)
|
|||
|
Segment adjusted EBITDA – Quarter ended March 31, 2020
|
$
|
55
|
|
|
$
|
49
|
|
|
$
|
104
|
|
|
|
Six Months Ended March 31,
|
|
|
|
|
|
Dollar Change Due To
|
|||||||||||||||
|
|
2020
|
|
2019
|
|
Dollar
Change
|
|
%
Change
|
|
Currency
|
|
Volume/ Other
|
|||||||||||
|
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Commercial Truck
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
North America
|
$
|
631
|
|
|
$
|
860
|
|
|
$
|
(229
|
)
|
|
(27
|
)%
|
|
$
|
—
|
|
|
$
|
(229
|
)
|
|
Europe
|
281
|
|
|
356
|
|
|
(75
|
)
|
|
(21
|
)%
|
|
(8
|
)
|
|
(67
|
)
|
|||||
|
South America
|
103
|
|
|
113
|
|
|
(10
|
)
|
|
(9
|
)%
|
|
(13
|
)
|
|
3
|
|
|||||
|
China
|
60
|
|
|
85
|
|
|
(25
|
)
|
|
(29
|
)%
|
|
(2
|
)
|
|
(23
|
)
|
|||||
|
India
|
44
|
|
|
119
|
|
|
(75
|
)
|
|
(63
|
)%
|
|
—
|
|
|
(75
|
)
|
|||||
|
Other
|
28
|
|
|
48
|
|
|
(20
|
)
|
|
(42
|
)%
|
|
(1
|
)
|
|
(19
|
)
|
|||||
|
Total External Sales
|
$
|
1,147
|
|
|
$
|
1,581
|
|
|
$
|
(434
|
)
|
|
(27
|
)%
|
|
$
|
(24
|
)
|
|
$
|
(410
|
)
|
|
Intersegment Sales
|
63
|
|
|
74
|
|
|
(11
|
)
|
|
(15
|
)%
|
|
(3
|
)
|
|
(8
|
)
|
|||||
|
Total Sales
|
$
|
1,210
|
|
|
$
|
1,655
|
|
|
$
|
(445
|
)
|
|
(27
|
)%
|
|
$
|
(27
|
)
|
|
$
|
(418
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Aftermarket, Industrial and Trailer
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
North America
|
$
|
538
|
|
|
$
|
561
|
|
|
$
|
(23
|
)
|
|
(4
|
)%
|
|
$
|
—
|
|
|
$
|
(23
|
)
|
|
Europe
|
85
|
|
|
52
|
|
|
33
|
|
|
63
|
%
|
|
(3
|
)
|
|
36
|
|
|||||
|
Other
|
2
|
|
|
—
|
|
|
2
|
|
|
N/A
|
|
|
—
|
|
|
2
|
|
|||||
|
Total External Sales
|
$
|
625
|
|
|
$
|
613
|
|
|
$
|
12
|
|
|
2
|
%
|
|
$
|
(3
|
)
|
|
$
|
15
|
|
|
Intersegment Sales
|
11
|
|
|
19
|
|
|
(8
|
)
|
|
(42
|
)%
|
|
(2
|
)
|
|
(6
|
)
|
|||||
|
Total Sales
|
$
|
636
|
|
|
$
|
632
|
|
|
$
|
4
|
|
|
1
|
%
|
|
$
|
(5
|
)
|
|
$
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Total External Sales
|
$
|
1,772
|
|
|
$
|
2,194
|
|
|
$
|
(422
|
)
|
|
(19
|
)%
|
|
$
|
(27
|
)
|
|
$
|
(395
|
)
|
|
|
Six Months Ended March 31,
|
|
|
|
|
|||||||||
|
|
2020
|
|
2019
|
|
Dollar
Change
|
|
%
Change
|
|||||||
|
Sales
|
$
|
1,772
|
|
|
$
|
2,194
|
|
|
$
|
(422
|
)
|
|
(19
|
)%
|
|
Cost of sales
|
(1,531
|
)
|
|
(1,879
|
)
|
|
348
|
|
|
19
|
%
|
|||
|
GROSS PROFIT
|
241
|
|
|
315
|
|
|
(74
|
)
|
|
(23
|
)%
|
|||
|
Selling, general and administrative
|
(129
|
)
|
|
(107
|
)
|
|
(22
|
)
|
|
(21
|
)%
|
|||
|
Income from WABCO distribution termination
|
265
|
|
|
—
|
|
|
265
|
|
|
N/A
|
|
|||
|
Other operating income (expense), net
|
(15
|
)
|
|
1
|
|
|
(16
|
)
|
|
(1,600
|
)%
|
|||
|
Other income, net
|
24
|
|
|
20
|
|
|
4
|
|
|
20
|
%
|
|||
|
Equity in earnings of affiliates
|
12
|
|
|
15
|
|
|
(3
|
)
|
|
(20
|
)%
|
|||
|
Interest expense, net
|
(30
|
)
|
|
(29
|
)
|
|
(1
|
)
|
|
(3
|
)%
|
|||
|
INCOME BEFORE INCOME TAXES
|
368
|
|
|
215
|
|
|
153
|
|
|
71
|
%
|
|||
|
Provision for income taxes
|
(86
|
)
|
|
(48
|
)
|
|
(38
|
)
|
|
(79
|
)%
|
|||
|
INCOME FROM CONTINUING OPERATIONS
|
282
|
|
|
167
|
|
|
115
|
|
|
69
|
%
|
|||
|
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, net of tax
|
1
|
|
|
(1
|
)
|
|
2
|
|
|
200
|
%
|
|||
|
NET INCOME
|
283
|
|
|
166
|
|
|
117
|
|
|
70
|
%
|
|||
|
Less: Net income attributable to noncontrolling interests
|
(3
|
)
|
|
(4
|
)
|
|
1
|
|
|
(25
|
)%
|
|||
|
NET INCOME ATTRIBUTABLE TO MERITOR, INC.
|
$
|
280
|
|
|
$
|
162
|
|
|
$
|
118
|
|
|
73
|
%
|
|
|
Segment adjusted EBITDA
|
|
Segment adjusted EBITDA margins
|
|||||||||||||||||
|
|
Six Months Ended March 31,
|
|
|
|
Six Months Ended March 31,
|
|
|
|||||||||||||
|
|
2020
|
|
2019
|
|
Change
|
|
2020
|
|
2019
|
|
Change
|
|||||||||
|
Commercial Truck
|
$
|
111
|
|
|
$
|
165
|
|
|
$
|
(54
|
)
|
|
9.2
|
%
|
|
10.0
|
%
|
|
(0.8
|
) pts
|
|
Aftermarket, Industrial and Trailer
|
89
|
|
|
92
|
|
|
(3
|
)
|
|
14.0
|
%
|
|
14.6
|
%
|
|
(0.6
|
) pts
|
|||
|
Segment adjusted EBITDA
|
$
|
200
|
|
|
$
|
257
|
|
|
$
|
(57
|
)
|
|
11.3
|
%
|
|
11.7
|
%
|
|
(0.4
|
) pts
|
|
|
Commercial Truck
|
|
Aftermarket, Industrial and Trailer
|
|
TOTAL
|
||||||
|
Segment adjusted EBITDA– Six months ended March 31, 2019
|
$
|
165
|
|
|
$
|
92
|
|
|
$
|
257
|
|
|
Lower earnings from unconsolidated affiliates
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||
|
Impact of foreign currency exchange rates
|
(7
|
)
|
|
(2
|
)
|
|
(9
|
)
|
|||
|
Volume, mix, pricing and other
|
(44
|
)
|
|
(1
|
)
|
|
(45
|
)
|
|||
|
Segment adjusted EBITDA – Six months ended March 31, 2020
|
$
|
111
|
|
|
$
|
89
|
|
|
$
|
200
|
|
|
|
Six Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
|
OPERATING CASH FLOWS
|
|
|
|
||||
|
Income from continuing operations
|
$
|
282
|
|
|
$
|
167
|
|
|
Depreciation and amortization
|
50
|
|
|
43
|
|
||
|
Deferred income tax expense (benefit)
|
(4
|
)
|
|
16
|
|
||
|
Restructuring costs
|
15
|
|
|
(1
|
)
|
||
|
Equity in earnings of affiliates
|
(12
|
)
|
|
(15
|
)
|
||
|
Pension and retiree medical income
|
(21
|
)
|
|
(19
|
)
|
||
|
Asbestos related liability remeasurement
|
—
|
|
|
(31
|
)
|
||
|
Dividends received from equity method investments
|
—
|
|
|
1
|
|
||
|
Pension and retiree medical contributions
|
(7
|
)
|
|
(8
|
)
|
||
|
Restructuring payments
|
(15
|
)
|
|
(1
|
)
|
||
|
Changes in receivables, inventories and accounts payable
|
(8
|
)
|
|
(91
|
)
|
||
|
Changes in off-balance sheet accounts receivable factoring
|
20
|
|
|
22
|
|
||
|
Changes in other current assets and liabilities
|
(49
|
)
|
|
(33
|
)
|
||
|
Changes in other assets and liabilities
|
38
|
|
|
(6
|
)
|
||
|
Other, net
|
1
|
|
|
8
|
|
||
|
Cash flows provided by continuing operations
|
290
|
|
|
52
|
|
||
|
Cash flows used for discontinued operations
|
—
|
|
|
(1
|
)
|
||
|
CASH PROVIDED BY OPERATING ACTIVITIES
|
$
|
290
|
|
|
$
|
51
|
|
|
|
Six Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
|
INVESTING CASH FLOWS
|
|
|
|
||||
|
Capital expenditures
|
$
|
(33
|
)
|
|
$
|
(44
|
)
|
|
Cash paid for acquisition of TransPower, net of cash acquired
|
(13
|
)
|
|
(3
|
)
|
||
|
Other investing activities
|
9
|
|
|
—
|
|
||
|
CASH USED FOR INVESTING ACTIVITIES
|
$
|
(37
|
)
|
|
$
|
(47
|
)
|
|
|
Six Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
|
FINANCING CASH FLOWS
|
|
|
|
||||
|
Securitization
|
$
|
96
|
|
|
$
|
48
|
|
|
Borrowings against revolving line of credit
|
304
|
|
|
—
|
|
||
|
Redemption of notes
|
—
|
|
|
(19
|
)
|
||
|
Term loan payments
|
(4
|
)
|
|
—
|
|
||
|
Other financing activities
|
(1
|
)
|
|
(1
|
)
|
||
|
Net change in debt
|
395
|
|
|
28
|
|
||
|
Repurchase of common stock
|
(241
|
)
|
|
(50
|
)
|
||
|
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES
|
$
|
154
|
|
|
$
|
(22
|
)
|
|
|
March 31, 2020
|
|
September 30, 2019
|
||||
|
Fixed-rate debt securities
|
$
|
445
|
|
|
$
|
444
|
|
|
Fixed-rate convertible notes
|
342
|
|
|
342
|
|
||
|
Unamortized discount on convertible notes
|
(31
|
)
|
|
(34
|
)
|
||
|
Term loan
|
171
|
|
|
175
|
|
||
|
Other borrowings
|
414
|
|
|
16
|
|
||
|
Total debt
|
$
|
1,341
|
|
|
$
|
943
|
|
|
|
Total Facility
Size
|
|
Utilized as of
3/31/20
|
|
Readily Available as of
3/31/20
|
|
Current Expiration
|
||||||
|
On-balance sheet arrangements:
|
|
|
|
|
|
|
|
||||||
|
Revolving credit facility
(1)
|
$
|
625
|
|
|
$
|
304
|
|
|
$
|
321
|
|
|
June 2024
(1)
|
|
Committed U.S. accounts receivable securitization
(2)
|
115
|
|
|
108
|
|
|
—
|
|
|
December 2022
|
|||
|
Total on-balance sheet arrangements
|
$
|
740
|
|
|
$
|
412
|
|
|
$
|
321
|
|
|
|
|
Off-balance sheet arrangements:
(2)
|
|
|
|
|
|
|
|
||||||
|
Committed Swedish factoring facility
(3)(4)
|
$
|
171
|
|
|
$
|
147
|
|
|
$
|
—
|
|
|
March 2024
|
|
Committed U.S. factoring facility
(3)
|
75
|
|
|
48
|
|
|
—
|
|
|
February 2023
|
|||
|
Uncommitted U.K. factoring facility
|
28
|
|
|
5
|
|
|
—
|
|
|
February 2022
|
|||
|
Uncommitted Italy factoring facility
|
33
|
|
|
25
|
|
|
—
|
|
|
June 2022
|
|||
|
Other uncommitted factoring facilities
(5)
|
N/A
|
|
|
19
|
|
|
N/A
|
|
|
N/A
|
|||
|
Total off-balance sheet arrangements
|
307
|
|
|
244
|
|
|
—
|
|
|
|
|||
|
Total available sources
|
$
|
1,047
|
|
|
$
|
656
|
|
|
$
|
321
|
|
|
|
|
(1)
|
The availability under the revolving credit facility is subject to a priority debt-to-EBITDA ratio covenant. The facility will expire in November 2023 if the outstanding amount of the 6.25 percent notes due 2024 is greater than $75 million at that time.
|
|
(2)
|
Availability subject to adequate eligible accounts receivable available for sale.
|
|
(3)
|
Actual amounts may exceed the bank's commitment at the bank's discretion.
|
|
(4)
|
The facility is backed by a 364-day liquidity commitment from Nordea Bank which extends through June 22, 2020.
|
|
(5)
|
There is no explicit facility size under the agreement, but the counterparty approves the purchase of receivable tranches at its discretion.
|
|
|
Assuming a
10% Increase
in Rates
|
|
Assuming a
10% Decrease
in Rates
|
|
Increase (Decrease) in
|
||||
|
Foreign Currency Sensitivity:
|
|
|
|
|
|
||||
|
Forward contracts in USD
(1)
|
$
|
(0.5
|
)
|
|
$
|
0.5
|
|
|
Fair Value
|
|
Forward contracts in Euro
(1)
|
(2.0
|
)
|
|
2.0
|
|
|
Fair Value
|
||
|
Foreign currency denominated debt
(2)
|
0.4
|
|
|
(0.4
|
)
|
|
Fair Value
|
||
|
Foreign currency option contracts in USD
|
—
|
|
|
—
|
|
|
Fair Value
|
||
|
Foreign currency option contracts in Euro
|
—
|
|
|
0.5
|
|
|
Fair Value
|
||
|
|
|
|
|
|
|
||||
|
|
Assuming a 50
BPS Increase
in Rates
|
|
Assuming a 50
BPS Decrease
in Rates
|
|
Increase (Decrease) in
|
||||
|
Interest Rate Sensitivity:
|
|
|
|
|
|
||||
|
Debt – fixed rate
(3)
|
$
|
(25.2
|
)
|
|
$
|
26.8
|
|
|
Fair Value
|
|
Debt – variable rate
|
(2.9
|
)
|
|
2.9
|
|
|
Cash flow
|
||
|
Period
|
Total Number of Shares Purchased
|
Average Price Paid Per Share
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
(1)
|
||||||
|
January 1- 31, 2020
|
3,885,821
|
|
$
|
25.73
|
|
3,885,821
|
|
$
|
99,899,695
|
|
|
February 1- 29, 2020
|
1,682,704
|
|
$
|
24.19
|
|
1,682,704
|
|
$
|
59,199,494
|
|
|
March 1- 31, 2020
|
—
|
|
$
|
—
|
|
—
|
|
$
|
59,199,494
|
|
|
Total
|
5,568,525
|
|
|
|
5,568,525
|
|
|
59,199,494
|
|
|
|
(1)
|
On July 26, 2019, the Board of Directors authorized the repurchase of up to
$250 million
of the company’s common stock from time to time through open market purchases, privately negotiated transactions or otherwise, subject to compliance with legal and regulatory requirements and the company’s debt covenants. This authorization superseded the remaining authority under the prior November 2018 equity repurchase authorization. On November 7, 2019, the Board of Directors increased the amount of the repurchase authorization to
$325 million
.
|
|
3-a
|
|
|
3-b
|
|
|
10-a**
|
|
|
10-b**
|
|
|
31-a**
|
|
|
31-b**
|
|
|
32-a**
|
|
|
32-b**
|
|
|
101.INS
|
Inline XBRL INSTANCE DOCUMENT - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
|
101.SCH
|
Inline XBRL TAXONOMY EXTENSION SCHEMA
|
|
101.PRE
|
Inline XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE
|
|
101.LAB
|
Inline XBRL TAXONOMY EXTENSION LABEL LINKBASE
|
|
101.CAL
|
Inline XBRL TAXONOMY EXTENSION CALCULATION LINKBASE
|
|
101.DEF
|
Inline XBRL TAXONOMY EXTENSION DEFINITION LINKBASE
|
|
104
|
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
|
|
|
|
MERITOR, INC.
|
||
|
|
|
|
|
|
|
Date:
|
April 30, 2020
|
By:
|
/s/
|
Scott M. Confer
|
|
|
|
|
|
Scott M. Confer
|
|
|
|
|
|
Interim Chief Legal Officer and Corporate Secretary
|
|
|
|
|
|
(For the registrant)
|
|
|
|
|
|
|
|
Date:
|
April 30, 2020
|
By:
|
/s/
|
Carl D. Anderson II
|
|
|
|
|
|
Carl D. Anderson II
|
|
|
|
|
|
Senior Vice President, Chief Financial Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date:
|
April 30, 2020
|
By:
|
/s/
|
Paul D. Bialy
|
|
|
|
|
|
Paul D. Bialy
|
|
|
|
|
|
Vice President, Chief Accounting Officer
|
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
| FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
|---|
| DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
|---|
No information found
Customers
| Customer name | Ticker |
|---|---|
| Terex Corporation | TEX |
No Suppliers Found
Price
Yield
| Owner | Position | Direct Shares | Indirect Shares |
|---|