XML 30 R19.htm IDEA: XBRL DOCUMENT
v3.7.0.1

Transactions with WestRock and related-parties | 6 Months Ended
--- | ---
Jun. 30, 2017
Related Party Transactions [Abstract] |
Transactions with WestRock and related-parties | Transactions with WestRock and related-parties For periods prior to May 15, 2016, these Condensed Consolidated Financial Statements include allocated expenses associated with centralized WestRock support functions including legal, accounting, tax, treasury, internal audit, information technology, human resources and other services. The costs associated with these functions generally include all payroll and benefit costs as well as related overhead costs. For periods prior to May 15, 2016, these Condensed Consolidated Financial Statements also include allocated costs associated with WestRock’s office facilities, corporate insurance coverage and medical, pension, post-retirement and other health plan costs attributed to Ingevity’s employees participating in WestRock’s sponsored plans. Allocations are generally based on a number of utilization measures including employee count and proportionate effort. In situations in which determinations based on utilization are impracticable, WestRock and Ingevity used other methods and criteria such as net sales which are believed to result in reasonable estimates of costs attributable to Ingevity. All such amounts have been assumed to have been immediately settled by Ingevity to WestRock in the period in which the costs were recorded in the Condensed Consolidated Financial Statements. Such amounts are included in Net cash provided by operating activities in the Condensed Consolidated Statements of Cash Flows. We believe the related-party allocations for periods included in these Condensed Consolidated Financial Statements for periods prior to May 15, 2016 have been made on a reasonable basis. However, these Condensed Consolidated Financial Statements may not necessarily be indicative of the results of operations that would have been obtained if Ingevity had operated as a separate entity during the periods presented. Actual costs that may have been incurred if Ingevity had been a stand-alone business would depend on a number of factors, including organizational structure and what functions were outsourced or performed by employees, as well as strategic decisions made in areas such as information technology and infrastructure. Consequently, Ingevity’s future earnings may include items of income and expense that are materially different from what is included in these Condensed Consolidated Statements of Operations for periods prior to May 15, 2016. Accordingly, the Condensed Consolidated Financial Statements for the periods presented are not necessarily indicative of Ingevity’s future results of operations, financial position and cash flows. The Condensed Consolidated Statements of Operations prior to May 15, 2016, include allocations from WestRock as summarized below:
| Three Months Ended June 30, |  | Six Months Ended June 30,
In millions | 2017 |  | 2016 |  | 2017 |  | 2016
Cost of sales | $ | — |  |  | $ | 1.4 |  |  | $ | — |  |  | $ | 5.7 |
Selling, general and administrative expenses | — |  |  | 2.2 |  |  | — |  |  | 6.5 |
Interest expense, net | — |  |  | 3.4 |  |  | — |  |  | 7.2 |
Total allocated cost (1) | $ | — |  |  | $ | 7.0 |  |  | $ | — |  |  | $ | 19.4 |
_______________
(1) | Allocated costs represent costs necessary to support Ingevity's operations which include governance and corporate functions such as information technology, accounting, human resources, accounts payable and other direct services including the interest on WestRock debt incurred to provide such services.
Prior to the Separation on May 15, 2016, we purchased certain raw materials from WestRock that were included in cost of sales. Purchases for the three and six months ended June 30, 2016 were $7.5 million and $20.1 million, respectively. Subsequent to May 15, 2016, Ingevity was no longer a related-party of WestRock. Accordingly, beginning May 16, 2016, sales to WestRock businesses are reflected in net sales in our Condensed Consolidated Statement of Operations. Purchases of products from WestRock businesses are reflected as inventory in our Condensed Consolidated Balance Sheet and prior to payment reflected as accounts payable in our Condensed Consolidated Balance Sheet. Our ongoing relationship with WestRock is governed by the Separation Agreements, as discussed within Part I, Item 1 of our 2016 Annual Report, including the long-term supply agreement for crude tall oil ("CTO"). Under this agreement, based on WestRock’s current output, we will source approximately 45 percent to 55 percent of our CTO requirements for the maximum operating rates of our facilities. As further described in Note 1, the Separation Agreements govern the relationship between Ingevity and WestRock following the Separation and provide for the allocation of various assets, liabilities, rights and obligations and include arrangements for transition services to be provided by WestRock to Ingevity. In accordance with the Separation Agreements at the day of Separation, we recorded a payable to WestRock in the amount of $16.5 million primarily representing certain trade liabilities previously classified as related-party. This amount was paid to WestRock in 2016.

X
- References No definition available. + Details
Name: | us-gaap_RelatedPartyTransactionsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -URI http://asc.fasb.org/topic&trid=2122745 + Details
Name: | us-gaap_RelatedPartyTransactionsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration