Discontinued Operations

3 Months Ended

Dec. 31, 2018

Discontinued Operations And Disposal Groups [Abstract]

NOTE C– DISCONTINUED OPERATIONS

In previous periods, Ashland has divested certain businesses that have qualified as discontinued operations. The operating results from these divested businesses and subsequent adjustments related to ongoing assessments of certain retained liabilities and tax items have been recorded within the discontinued operations caption in the Statements of Consolidated Comprehensive Income (Loss) for all periods presented and are discussed further within this note.

As previously described in Note B, Ashland announced that it had signed a definitive agreement on November 15, 2018 to sell its Composites segment and Intermediates and Solvents Marl facility. Ashland determined that this expected divestiture qualified as a discontinued operation, in accordance with U.S. GAAP, since it represents a strategic shift for Ashland and had a major effect on Ashland's operations and financial results. Accordingly, the operating results and cash flows for Composites and the Marl facility have been classified as discontinued operations within the Condensed Consolidated Financial Statements for all periods presented.

Ashland completed the distribution of its remaining shares of common stock of Valvoline Inc. on May 12, 2017. Ashland determined that the Valvoline separation qualified as a discontinued operation, in accordance with U.S. GAAP, since it represents a strategic shift for Ashland and had a major effect on Ashland's operations and financial results. Ashland has made subsequent tax adjustments to the discontinued operations caption related to this transaction.

Components of amounts reflected in the Statements of Consolidated Comprehensive Income (Loss) related to discontinued operations are presented in the following table for the three months ended December 31, 2018 and 2017.

	Three months ended
	December 31
(In millions)	2018			2017
Income (loss) from discontinued operations (net of tax)
Composites/Marl facility	$	25		$	25
Valvoline		—			3
Water Technologies		(1	)		—
Distribution		(1	)		—
	$	23		$	28

The following table presents a reconciliation of the captions within Ashland's Statements of Consolidated Comprehensive Income (Loss) for the income (loss) from discontinued operations attributable to Composites and the Marl facility for the three months ended December 31, 2018 and 2017. Interest expense was allocated to discontinued operations based on Ashland’s mandatory debt prepayments upon the disposition of Composites and the Marl facility.

	Three months ended
	December 31
(In millions)	2018			2017
Income (loss) from discontinued operations attributable
to Composites/Marl facility
Sales	$	275		$	261
Cost of sales		(217	)		(211	)
Selling, general and administrative expense		(22	)		(17	)
Research and development expense		(3	)		(2	)
Equity and other income		3			3
Pretax operating income of discontinued operations		36			34
Net interest and other financing expense		(6	)		(4	)
Pretax income of discontinued operations		30			30
Income tax expense		(5	)		(5	)
Income from discontinued operations	$	25		$	25