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STOCKHOLDERS' EQUITY

6 Months Ended

Jun. 30, 2020

Stockholders' Equity Note [Abstract]

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY

Reconciliations of the changes in stockholders' equity for second quarter 2020 and 2019 are provided below:

(Dollars in millions, except per share amount)			Common Stock at Par Value						Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Income (Loss)						Treasury Stock at Cost						Total Eastman Stockholders' Equity						Noncontrolling Interest						Total Equity
Balance at March 31, 2020			$	2					$	2,109					$	8,133					$	(197)					$	(3,930)					$	6,117					$	75					$	6,192
Net Earnings			—						—						27						—						—						27						3						30
Cash Dividends Declared (1) ($0.66 per share)			—						—						(89)						—						—						(89)						—						(89)
Other Comprehensive Income (Loss)			—						—						—						(12)						—						(12)						—						(12)
Share Based Compensation Expense (2)			—						5						—						—						—						5						—						5
Stock Option Exercises			—						3						—						—						—						3						—						3
Other			—						—						—						—						—						—						2						2
Share Repurchase			—						—						—						—						(30)						(30)						—						(30)
Distributions to noncontrolling interest			—						—						—						—						—						—						(3)						(3)
Balance at June 30, 2020			$	2					$	2,117					$	8,071					$	(209)					$	(3,960)					$	6,021					$	77					$	6,098

(Dollars in millions, except per share amount)			Common Stock at Par Value						Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Income (Loss)						Treasury Stock at Cost						Total Eastman Stockholders' Equity						Noncontrolling Interest						Total Equity
Balance at March 31, 2019			$	2					$	2,060					$	7,675					$	(194)					$	(3,700)					$	5,843					$	76					$	5,919
Net Earnings			—						—						258						—						—						258						1						259
Cash Dividends Declared (1) ($0.62 per share)			—						—						(85)						—						—						(85)						—						(85)
Other Comprehensive Income (Loss)			—						—						—						(41)						—						(41)						—						(41)
Share Based Compensation Expense (2)			—						15						—						—						—						15						—						15
Stock Option Exercises			—						4						—						—						—						4						—						4
Share Repurchase			—						—						—						—						(125)						(125)						—						(125)
Balance at June 30, 2019			$	2					$	2,079					$	7,848					$	(235)					$	(3,825)					$	5,869					$	77					$	5,946

⁽¹⁾Cash dividends declared consists of cash dividends paid and dividends declared but unpaid.

⁽²⁾Share-based compensation expense is the fair value of share-based awards.

Reconciliations of the changes in stockholders' equity for first six months 2020 and 2019 are provided below:

(Dollars in millions, except per share amount)			Common Stock at Par Value						Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Income (Loss)						Treasury Stock at Cost						Total Eastman Stockholders' Equity						Noncontrolling Interest						Total Equity
Balance at December 31, 2019			$	2					$	2,105					$	7,965					$	(214)					$	(3,900)					$	5,958					$	74					$	6,032
Net Earnings			—						—						285						—						—						285						5						290
Cash Dividends Declared (1) ($1.32 per share)			—						—						(179)						—						—						(179)						—						(179)
Other Comprehensive Income (Loss)			—						—						—						5						—						5						—						5
Share-Based Compensation Expense (2)			—						20						—						—						—						20						—						20
Stock Option Exercises			—						3						—						—						—						3						—						3
Other (3)			—						(11)						—						—						—						(11)						1						(10)
Share Repurchases			—						—						—						—						(60)						(60)						—						(60)
Distributions to Noncontrolling Interest			—						—						—						—						—						—						(3)						(3)
Balance at June 30, 2020			$	2					$	2,117					$	8,071					$	(209)					$	(3,960)					$	6,021					$	77					$	6,098

(Dollars in millions, except per share amount)			Common Stock at Par Value						Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Income (Loss)						Treasury Stock at Cost						Total Eastman Stockholders' Equity						Noncontrolling Interest						Total Equity
Balance at December 31, 2018			$	2					$	2,048					$	7,573					$	(245)					$	(3,575)					$	5,803					$	75					$	5,878
Cumulative Effect of Adoption of New Accounting Standards (4)			—						—						(20)						20						—						—						—						—
Net Earnings			—						—						467						—						—						467						1						468
Cash Dividends Declared (1) ($1.24 per share)			—						—						(172)						—						—						(172)						—						(172)
Other Comprehensive Income (Loss)			—						—						—						(10)						—						(10)						—						(10)
Share-Based Compensation Expense (2)			—						33						—						—						—						33						—						33
Stock Option Exercises			—						8						—						—						—						8						—						8
Other (3)			—						(10)						—						—						—						(10)						1						(9)
Share Repurchases			—						—						—						—						(250)						(250)						—						(250)
Balance at June 30, 2019			$	2					$	2,079					$	7,848					$	(235)					$	(3,825)					$	5,869					$	77					$	5,946

⁽¹⁾Cash dividends declared consists of cash dividends paid and dividends declared but unpaid.

⁽²⁾Share-based compensation expense is the fair value of share-based awards.

⁽³⁾Additional paid-in capital consists of value of shares withheld for employees' taxes on vesting of share-based compensation awards.

⁽⁴⁾On January 1, 2019, Eastman adopted ASU 2018-02 Income Statement - Reporting Comprehensive Income resulting in the reclassification of $20 million of stranded tax expense from AOCI to retained earnings.

Accumulated Other Comprehensive Income (Loss), Net of Tax

(Dollars in millions)			Cumulative Translation Adjustment						Benefit Plans Unrecognized Prior Service Credits						Unrealized Gains (Losses) on Derivative Instruments						Unrealized Losses on Investments						Accumulated Other Comprehensive Income (Loss)
Balance at December 31, 2018			$	(309)					$	106					$	(41)					$	(1)					$	(245)
Period change (1)			45						—						(14)						—						31
Balance at December 31, 2019			(264)						106						(55)						(1)						(214)
Period change			5						(14)						14						—						5
Balance at June 30, 2020			$	(259)					$	92					$	(41)					$	(1)					$	(209)

⁽¹⁾Benefit plans unrecognized prior service credits includes $29 million reclassification of stranded tax expense from AOCI to retained earnings and unrealized gains (losses) on derivative instruments includes $9 million reclassification of stranded tax benefit from AOCI to retained earnings.

Amounts of other comprehensive income (loss) are presented net of applicable taxes. Eastman recognizes deferred income taxes on the CTA related to branch operations and income from other entities included in the Company's consolidated U.S. tax return. No deferred income taxes are recognized on the CTA of other subsidiaries outside the United States, because the CTA is considered to be a component of indefinitely invested, unremitted earnings of these foreign subsidiaries.

Components of other comprehensive income recognized in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings are presented below, before tax and net of tax effects:

			Second Quarter
			2020																		2019
(Dollars in millions)			Before Tax						Net of Tax						Before Tax						Net of Tax
Other comprehensive income (loss)
Change in cumulative translation adjustment			$	(14)					$	(14)					$	(13)					$	(13)
Defined benefit pension and other postretirement benefit plans:
Amortization of unrecognized prior service credits			(9)						(7)						(10)						(8)
Derivatives and hedging:
Unrealized gain (loss) during period			(5)						(3)						(29)						(22)
Reclassification adjustment for (gains) losses included in net income, net			17						12						2						2
Total other comprehensive income (loss)			$	(11)					$	(12)					$	(50)					$	(41)
			First Six Months
			2020																		2019
(Dollars in millions)			Before Tax						Net of Tax						Before Tax						Net of Tax
Other comprehensive income (loss)
Change in cumulative translation adjustment			$	5					$	5					$	17					$	17
Defined benefit pension and other postretirement benefit plans:
Amortization of unrecognized prior service credits			(19)						(14)						(20)						(15)
Derivatives and hedging:
Unrealized gain (loss) during period			5						4						(16)						(12)
Reclassification adjustment for (gains) losses included in net income, net			14						10						—						—
Total other comprehensive income (loss)			$	5					$	5					$	(19)					$	(10)

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- References

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- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-URI http://asc.fasb.org/topic&trid=2208762

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