Supplemental Guarantor And Non-Guarantor Condensed Consolidating Financial Statements

9 Months Ended

Sep. 30, 2018

Supplemental Guarantor And Non-Guarantor Condensed Consolidating Financial Statements [Abstract]

Supplemental Guarantor And Non-Guarantor Condensed Consolidating Financial Statements

SUPPLEMENTAL GUARANTOR AND NON-GUARANTOR CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

Basis of Presentation

Notes Issued by the Subsidiary Issuer

As described in Note 8. Debt, Aptiv Corporation (the “Subsidiary Issuer/Guarantor”), a 100% owned subsidiary of Aptiv PLC (the “Parent”), issued the 2014 Senior Notes, which were registered under the Securities Act, and is the borrower of obligations under the Credit Agreement. The 2014 Senior Notes and obligations under the Credit Agreement are fully and unconditionally guaranteed by Aptiv PLC and certain of Aptiv PLC’s direct and indirect subsidiary companies, which are directly or indirectly 100% owned by Aptiv PLC (the “Subsidiary Guarantors”), on a joint and several basis, subject to customary release provisions (other than in the case of Aptiv PLC). All other consolidated direct and indirect subsidiaries of Aptiv PLC are not subject to the guarantees (“Non-Guarantor Subsidiaries”).

Notes Issued by the Parent

As described in Note 8. Debt, Aptiv PLC issued the 2015 Senior Notes, the 2015 Euro-denominated Senior Notes, the 2016 Euro-denominated Senior Notes and the 2016 Senior Notes, each of which were registered under the Securities Act. Each series of these senior notes are fully and unconditionally guaranteed on a joint and several basis, subject to customary release provisions, by certain of Aptiv PLC’s direct and indirect subsidiary companies (the “Subsidiary Guarantors”), and Aptiv Corporation, each of which are directly or indirectly 100% owned by Aptiv PLC. All other consolidated direct and indirect subsidiaries of Aptiv PLC are not subject to the guarantees (“Non-Guarantor Subsidiaries”).

In lieu of providing separate audited financial statements for the Guarantors, the Company has included the accompanying condensed consolidating financial statements. These condensed consolidating financial statements are presented using the equity method. Under this method, the investments in subsidiaries are recorded at cost and adjusted for the Parent’s share of the subsidiary’s cumulative results of operations, capital contributions and distributions and other equity changes. The Non-Guarantor Subsidiaries are combined in the condensed consolidating financial statements. The principal elimination entries are to eliminate the investments in subsidiaries and intercompany balances and transactions.

The historical presentation of the supplemental guarantor and non-guarantor condensed consolidating financial statements have been revised to be consistent with the presentation of the entities that comprise the structure of the Subsidiary Guarantors as of September 30, 2018.

Statement of Operations Three Months Ended September 30, 2018



	Parent			Subsidiary Guarantors			Subsidiary Issuer/Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net sales	$	—		$	—		$	—		$	3,485		$	—		$	3,485
Operating expenses:
Cost of sales	—			—			—			2,834			—			2,834
Selling, general and administrative	38			—			—			194			—			232
Amortization	—			—			—			31			—			31
Restructuring	—			—			—			65			—			65
Total operating expenses	38			—			—			3,124			—			3,162
Operating (loss) income	(38		)	—			—			361			—			323
Interest (expense) income	(22		)	(30		)	(52		)	(6		)	76			(34		)
Other income (expense), net	—			—			5			75			(76		)	4
(Loss) income from continuing operations before income taxes and equity income	(60		)	(30		)	(47		)	430			—			293
Income tax benefit (expense)	—			—			11			(77		)	—			(66		)
(Loss) income from continuing operations before equity income	(60		)	(30		)	(36		)	353			—			227
Equity in net income of affiliates	—			—			—			4			—			4
Equity in net income (loss) of subsidiaries	282			282			78			—			(642		)	—
Income (loss) from continuing operations	222			252			42			357			(642		)	231
Income from discontinued operations, net of tax	—			—			—			—			—			—
Net income (loss)	222			252			42			357			(642		)	231
Net income attributable to noncontrolling interest	—			—			—			9			—			9
Net income (loss) attributable to Aptiv	$	222		$	252		$	42		$	348		$	(642	)	$	222

Statement of Operations Nine Months Ended September 30, 2018



	Parent			Subsidiary Guarantors			Subsidiary Issuer/Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net sales	$	—		$	—		$	—		$	10,799		$	—		$	10,799
Operating expenses:
Cost of sales	—			—			—			8,739			—			8,739
Selling, general and administrative	53			—			—			698			—			751
Amortization	—			—			—			91			—			91
Restructuring	—			—			—			100			—			100
Total operating expenses	53			—			—			9,628			—			9,681
Operating (loss) income	(53		)	—			—			1,171			—			1,118
Interest (expense) income	(116		)	(61		)	(142		)	(9		)	224			(104		)
Other income (expense), net	—			1			6			244			(224		)	27
(Loss) income from continuing operations before income taxes and equity income	(169		)	(60		)	(136		)	1,406			—			1,041
Income tax benefit (expense)	—			—			31			(239		)	—			(208		)
(Loss) income from continuing operations before equity income	(169		)	(60		)	(105		)	1,167			—			833
Equity in net income of affiliates	—			—			—			17			—			17
Equity in net income (loss) of subsidiaries	989			906			(10		)	—			(1,885		)	—
Income (loss) from continuing operations	820			846			(115		)	1,184			(1,885		)	850
Income from discontinued operations, net of tax	—			—			—			—			—			—
Net income (loss)	820			846			(115		)	1,184			(1,885		)	850
Net income attributable to noncontrolling interest	—			—			—			30			—			30
Net income (loss) attributable to Aptiv	$	820		$	846		$	(115	)	$	1,154		$	(1,885	)	$	820

Statement of Operations Three Months Ended September 30, 2017



	Parent			Subsidiary Guarantors			Subsidiary Issuer/Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net sales	$	—		$	—		$	—		$	3,148		$	—		$	3,148
Operating expenses:
Cost of sales	—			—			—			2,498			—			2,498
Selling, general and administrative	37			—			—			193			—			230
Amortization	—			—			—			29			—			29
Restructuring	—			—			—			18			—			18
Total operating expenses	37			—			—			2,738			—			2,775
Operating (loss) income	(37		)	—			—			410			—			373
Interest (expense) income	(66		)	(10		)	(44		)	(2		)	87			(35		)
Other income (expense), net	—			39			1			40			(87		)	(7		)
(Loss) income from continuing operations before income taxes and equity income	(103		)	29			(43		)	448			—			331
Income tax (expense) benefit	(1		)	—			16			(46		)	—			(31		)
(Loss) income from continuing operations before equity income	(104		)	29			(27		)	402			—			300
Equity in net income of affiliates	—			—			—			6			—			6
Equity in net income (loss) of subsidiaries	499			470			40			—			(1,009		)	—
Income (loss) from continuing operations	395			499			13			408			(1,009		)	306
Income from discontinued operations, net of tax	—			—			—			107			—			107
Net income (loss)	395			499			13			515			(1,009		)	413
Net income attributable to noncontrolling interest	—			—			—			18			—			18
Net income (loss) attributable to Aptiv	$	395		$	499		$	13		$	497		$	(1,009	)	$	395

Statement of Operations Nine Months Ended September 30, 2017



	Parent			Subsidiary Guarantors			Subsidiary Issuer/Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net sales	$	—		$	—		$	—		$	9,444		$	—		$	9,444
Operating expenses:
Cost of sales	—			—			—			7,540			—			7,540
Selling, general and administrative	72			—			—			614			—			686
Amortization	—			—			—			87			—			87
Restructuring	—			—			—			101			—			101
Total operating expenses	72			—			—			8,342			—			8,414
Operating (loss) income	(72		)	—			—			1,102			—			1,030
Interest (expense) income	(188		)	(14		)	(130		)	(7		)	236			(103		)
Other income (expense), net	—			105			2			107			(236		)	(22		)
(Loss) income from continuing operations before income taxes and equity income	(260		)	91			(128		)	1,202			—			905
Income tax benefit (expense)	—			—			47			(135		)	—			(88		)
(Loss) income from continuing operations before equity income	(260		)	91			(81		)	1,067			—			817
Equity in net income of affiliates	—			—			—			24			—			24
Equity in net income (loss) of subsidiaries	1,359			1,268			59			—			(2,686		)	—
Income (loss) from continuing operations	1,099			1,359			(22		)	1,091			(2,686		)	841
Income from discontinued operations, net of tax	—			—			—			310			—			310
Net income (loss)	1,099			1,359			(22		)	1,401			(2,686		)	1,151
Net income attributable to noncontrolling interest	—			—			—			52			—			52
Net income (loss) attributable to Aptiv	$	1,099		$	1,359		$	(22	)	$	1,349		$	(2,686	)	$	1,099

Statement of Comprehensive Income Three Months Ended September 30, 2018



	Parent			Subsidiary Guarantors		Subsidiary Issuer/Guarantor		Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net income (loss)	$	222		$	252	$	42	$	357		$	(642	)	$	231
Other comprehensive (loss) income:
Currency translation adjustments	(22		)	—		—		(14		)	—			(36		)
Net change in unrecognized gain on derivative instruments, net of tax	—			—		—		14			—			14
Employee benefit plans adjustment, net of tax	—			—		—		2			—			2
Other comprehensive (loss) income	(22		)	—		—		2			—			(20		)
Equity in other comprehensive income (loss) of subsidiaries	6			110		32		—			(148		)	—
Comprehensive income (loss)	206			362		74		359			(790		)	211
Comprehensive income attributable to noncontrolling interests	—			—		—		5			—			5
Comprehensive income (loss) attributable to Aptiv	$	206		$	362	$	74	$	354		$	(790	)	$	206

Statement of Comprehensive Income Nine Months Ended September 30, 2018



	Parent			Subsidiary Guarantors			Subsidiary Issuer/Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net income (loss)	$	820		$	846		$	(115	)	$	1,184		$	(1,885	)	$	850
Other comprehensive income (loss):
Currency translation adjustments	31			—			—			(199		)	—			(168		)
Net change in unrecognized loss on derivative instruments, net of tax	—			—			—			(19		)	—			(19		)
Employee benefit plans adjustment, net of tax	—			—			—			12			—			12
Other comprehensive income (loss)	31			—			—			(206		)	—			(175		)
Equity in other comprehensive (loss) income of subsidiaries	(198		)	(37		)	33			—			202			—
Comprehensive income (loss)	653			809			(82		)	978			(1,683		)	675
Comprehensive income attributable to noncontrolling interests	—			—			—			22			—			22
Comprehensive income (loss) attributable to Aptiv	$	653		$	809		$	(82	)	$	956		$	(1,683	)	$	653

Statement of Comprehensive Income Three Months Ended September 30, 2017



	Parent			Subsidiary Guarantors			Subsidiary Issuer/Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net income (loss)	$	395		$	499		$	13		$	515		$	(1,009	)	$	413
Other comprehensive (loss) income:
Currency translation adjustments	(44		)	—			—			131			—			87
Net change in unrecognized loss on derivative instruments, net of tax	—			—			—			(9		)	—			(9		)
Employee benefit plans adjustment, net of tax	—			—			—			(6		)	—			(6		)
Other comprehensive (loss) income	(44		)	—			—			116			—			72
Equity in other comprehensive income (loss) of subsidiaries	113			(35		)	(7		)	—			(71		)	—
Comprehensive income (loss)	464			464			6			631			(1,080		)	485
Comprehensive income attributable to noncontrolling interests	—			—			—			21			—			21
Comprehensive income (loss) attributable to Aptiv	$	464		$	464		$	6		$	610		$	(1,080	)	$	464

Statement of Comprehensive Income Nine Months Ended September 30, 2017



	Parent			Subsidiary Guarantors		Subsidiary Issuer/Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net income (loss)	$	1,099		$	1,359	$	(22	)	$	1,401		$	(2,686	)	$	1,151
Other comprehensive (loss) income:
Currency translation adjustments	(147		)	—		—			423			—			276
Net change in unrecognized gain on derivative instruments, net of tax	—			—		—			34			—			34
Employee benefit plans adjustment, net of tax	—			—		—			(1		)	—			(1		)
Other comprehensive (loss) income	(147		)	—		—			456			—			309
Equity in other comprehensive income (loss) of subsidiaries	449			42		54			—			(545		)	—
Comprehensive income (loss)	1,401			1,401		32			1,857			(3,231		)	1,460
Comprehensive income attributable to noncontrolling interests	—			—		—			59			—			59
Comprehensive income (loss) attributable to Aptiv	$	1,401		$	1,401	$	32		$	1,798		$	(3,231	)	$	1,401

Balance Sheet as of September 30, 2018



	Parent		Subsidiary Guarantors		Subsidiary Issuer/Guarantor		Non-Guarantor Subsidiaries		Eliminations			Consolidated

	(in millions)
ASSETS
Current assets:
Cash and cash equivalents	$	1	$	—	$	—	$	770	$	—		$	771
Restricted cash	—		—		—		1		—			1
Accounts receivable, net	—		—		—		2,635		—			2,635
Intercompany receivables, current	1		16		2,038		4,758		(6,813		)	—
Inventories	—		—		—		1,358		—			1,358
Other current assets	—		—		—		439		—			439
Total current assets	2		16		2,038		9,961		(6,813		)	5,204
Long-term assets:
Intercompany receivables, long-term	—		—		768		1,465		(2,233		)	—
Property, net	—		—		—		3,056		—			3,056
Investments in affiliates	—		—		—		101		—			101
Investments in subsidiaries	6,957		10,994		2,191		—		(20,142		)	—
Intangible assets, net	—		—		—		3,378		—			3,378
Other long-term assets	—		—		6		582		—			588
Total long-term assets	6,957		10,994		2,965		8,582		(22,375		)	7,123
Total assets	$	6,959	$	11,010	$	5,003	$	18,543	$	(29,188	)	$	12,327
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt	$	—	$	—	$	20	$	4	$	—		$	24
Accounts payable	—		—		—		2,254		—			2,254
Intercompany payables, current	327		4,392		1,673		421		(6,813		)	—
Accrued liabilities	35		—		3		1,071		—			1,109
Total current liabilities	362		4,392		1,696		3,750		(6,813		)	3,387
Long-term liabilities:
Long-term debt	2,989		—		1,064		31		—			4,084
Intercompany payables, long-term	—		—		1,352		881		(2,233		)	—
Pension benefit obligations	—		—		—		439		—			439
Other long-term liabilities	—		—		—		608		—			608
Total long-term liabilities	2,989		—		2,416		1,959		(2,233		)	5,131
Total liabilities	3,351		4,392		4,112		5,709		(9,046		)	8,518
Total Aptiv shareholders’ equity	3,608		6,618		891		12,633		(20,142		)	3,608
Noncontrolling interest	—		—		—		201		—			201
Total shareholders’ equity	3,608		6,618		891		12,834		(20,142		)	3,809
Total liabilities and shareholders’ equity	$	6,959	$	11,010	$	5,003	$	18,543	$	(29,188	)	$	12,327

Balance Sheet as of December 31, 2017



	Parent		Subsidiary Guarantors		Subsidiary Issuer/Guarantor		Non-Guarantor Subsidiaries		Eliminations			Consolidated

	(in millions)
ASSETS
Current assets:
Cash and cash equivalents	$	1	$	—	$	—	$	1,595	$	—		$	1,596
Restricted cash	—		—		—		1		—			1
Accounts receivable, net	—		—		—		2,440		—			2,440
Intercompany receivables, current	50		16		82		9,867		(10,015		)	—
Inventories	—		—		—		1,083		—			1,083
Other current assets	—		—		—		521		—			521
Total current assets	51		16		82		15,507		(10,015		)	5,641
Long-term assets:
Intercompany receivables, long-term	—		—		768		1,366		(2,134		)	—
Property, net	—		—		—		2,804		—			2,804
Investments in affiliates	—		—		—		91		—			91
Investments in subsidiaries	11,987		13,707		3,416		—		(29,110		)	—
Intangible assets, net	—		—		—		3,163		—			3,163
Other long-term assets	60		—		8		402		—			470
Total long-term assets	12,047		13,707		4,192		7,826		(31,244		)	6,528
Total assets	$	12,098	$	13,723	$	4,274	$	23,333	$	(41,259	)	$	12,169
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt	$	—	$	—	$	13	$	4	$	—		$	17
Accounts payable	2		—		—		2,225		—			2,227
Intercompany payables, current	5,689		1,736		1,032		1,558		(10,015		)	—
Accrued liabilities	91		—		10		1,195		—			1,296
Total current liabilities	5,782		1,736		1,055		4,982		(10,015		)	3,540
Long-term liabilities:
Long-term debt	3,017		—		1,078		37		—			4,132
Intercompany payables, long-term	—		—		1,297		837		(2,134		)	—
Pension benefit obligations	—		—		—		454		—			454
Other long-term liabilities	—		—		—		526		—			526
Total long-term liabilities	3,017		—		2,375		1,854		(2,134		)	5,112
Total liabilities	8,799		1,736		3,430		6,836		(12,149		)	8,652
Total Aptiv shareholders’ equity	3,299		11,987		844		16,279		(29,110		)	3,299
Noncontrolling interest	—		—		—		218		—			218
Total shareholders’ equity	3,299		11,987		844		16,497		(29,110		)	3,517
Total liabilities and shareholders’ equity	$	12,098	$	13,723	$	4,274	$	23,333	$	(41,259	)	$	12,169

Statement of Cash Flows for the Nine Months Ended September 30, 2018



	Parent			Subsidiary Guarantors			Subsidiary Issuer/Guarantor		Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net cash (used in) provided by operating activities from continuing operations	$	(111	)	$	—		$	—	$	1,001		$	—		$	890
Net cash used in operating activities from discontinued operations	—			—			—		(19		)	—			(19		)
Net cash (used in) provided by operating activities	(111		)	—			—		982			—			871
Cash flows from investing activities:
Capital expenditures	—			—			—		(661		)	—			(661		)
Proceeds from sale of property / investments	—			—			—		10			—			10
Cost of business acquisitions, net of cash acquired	—			—			—		(512		)	—			(512		)
Return of investment from subsidiaries	5,879			4,971			—		—			(10,850		)	—
Settlement of derivatives	—			—			—		(6		)	—			(6		)
Loans to affiliates	—			—			—		(3,127		)	3,127			—
Repayments of loans from affiliates	—			—			—		7,598			(7,598		)	—
Net cash provided by (used in) investing activities from continuing operations	5,879			4,971			—		3,302			(15,321		)	(1,169		)
Net cash provided by investing activities from discontinued operations	—			—			—		—			—			—
Net cash provided by (used in) investing activities	5,879			4,971			—		3,302			(15,321		)	(1,169		)
Cash flows from financing activities:
Net repayments under other short-term debt agreements	—			—			—		(19		)	—			(19		)
Contingent consideration and deferred acquisition purchase price payments	—			—			—		(13		)	—			(13		)
Dividend payments of consolidated affiliates to minority shareholders	—			—			—		(26		)	—			(26		)
Proceeds from borrowings from affiliates	500			2,627			—		—			(3,127		)	—
Payments on borrowings from affiliates	(5,879		)	(1,719		)	—		—			7,598			—
Dividends paid to affiliates	—			(5,879		)	—		(4,971		)	10,850			—
Repurchase of ordinary shares	(214		)	—			—		—			—			(214		)
Distribution of cash dividends	(175		)	—			—		—			—			(175		)
Taxes withheld and paid on employees' restricted share awards	—			—			—		(35		)	—			(35		)
Net cash (used in) provided by financing activities	(5,768		)	(4,971		)	—		(5,064		)	15,321			(482		)
Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash	—			—			—		(45		)	—			(45		)
Decrease in cash, cash equivalents and restricted cash	—			—			—		(825		)	—			(825		)
Cash, cash equivalents and restricted cash at beginning of period	1			—			—		1,596			—			1,597
Cash, cash equivalents and restricted cash at end of period	$	1		$	—		$	—	$	771		$	—		$	772
Cash, cash equivalents and restricted cash of discontinued operations	$	—		$	—		$	—	$	—		$	—		$	—
Cash, cash equivalents and restricted cash of continuing operations	$	1		$	—		$	—	$	771		$	—		$	772

Statement of Cash Flows for the Nine Months Ended September 30, 2017



	Parent			Subsidiary Guarantors			Subsidiary Issuer/Guarantor		Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net cash (used in) provided by operating activities from continuing operations	$	(73	)	$	(255	)	$	—	$	1,013		$	—		$	685
Net cash provided by operating activities from discontinued operations	—			—			—		355			—			355
Net cash (used in) provided by operating activities	(73		)	(255		)	—		1,368			—			1,040
Cash flows from investing activities:
Capital expenditures	—			—			—		(480		)	—			(480		)
Proceeds from sale of property / investments	—			—			—		6			—			6
Cost of business acquisitions, net of cash acquired	—			—			—		(40		)	—			(40		)
Cost of technology investments	—			—			—		(50		)	—			(50		)
Settlement of derivatives	—			—			—		(12		)	—			(12		)
Loans to affiliates	—			(55		)	—		(960		)	1,015			—
Repayments of loans from affiliates	—			—			—		17			(17		)	—
Net cash (used in) provided by investing activities from continuing operations	—			(55		)	—		(1,519		)	998			(576		)
Net cash used in investing activities from discontinued operations	—			—			—		(106		)	—			(106		)
Net cash (used in) provided by investing activities	—			(55		)	—		(1,625		)	998			(682		)
Cash flows from financing activities:
Net repayments under other short-term debt agreements	—			—			—		(8		)	—			(8		)
Proceeds from issuance of senior notes, net of issuance costs	—			—			—		796			—			796
Contingent consideration and deferred acquisition purchase price payments	—			—			—		(24		)	—			(24		)
Dividend payments of consolidated affiliates to minority shareholders	—			—			—		(10		)	—			(10		)
Proceeds from borrowings from affiliates	705			310			—		—			(1,015		)	—
Payments on borrowings from affiliates	(17		)	—			—		—			17			—
Repurchase of ordinary shares	(383		)	—			—		—			—			(383		)
Distribution of cash dividends	(233		)	—			—		—			—			(233		)
Taxes withheld and paid on employees' restricted share awards	—			—			—		(33		)	—			(33		)
Net cash provided by (used in) financing activities	72			310			—		721			(998		)	105
Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash	—			—			—		52			—			52
(Decrease) increase in cash, cash equivalents and restricted cash	(1		)	—			—		516			—			515
Cash, cash equivalents and restricted cash at beginning of period	2			—			—		837			—			839
Cash, cash equivalents and restricted cash at end of period	$	1		$	—		$	—	$	1,353		$	—		$	1,354
Cash, cash equivalents and restricted cash of discontinued operations	$	—		$	—		$	—	$	891		$	—		$	891
Cash, cash equivalents and restricted cash of continuing operations	$	1		$	—		$	—	$	462		$	—		$	463