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Reportable Segments (Tables) | 9 Months Ended
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Sep. 30, 2018
Segment Reporting [Abstract] |
Reconciliation of Revenue from Reportable Segments to Consolidated | Summarized financial information for the Company’s (1) Environmental Catalysts & Services and (2) Performance Materials & Chemicals reportable segments is shown in the following table:
|  | Three months ended September 30, |  | Nine months ended September 30,
|  | 2018 |  | 2017 |  | 2018 |  | 2017
Net sales: |  |  |  |  |  |  |  |
Silica Catalysts |  | $ | 16,347 |  |  | $ | 15,117 |  |  | $ | 50,167 |  |  | $ | 52,302 |
Refining Services |  | 123,369 |  |  | 100,424 |  |  | 336,154 |  |  | 298,512 |
Environmental Catalysts & Services(1) |  | 139,716 |  |  | 115,541 |  |  | 386,321 |  |  | 350,814 |
Performance Chemicals |  | 174,722 |  |  | 175,467 |  |  | 548,446 |  |  | 515,454 |
Performance Materials |  | 115,380 |  |  | 104,433 |  |  | 304,660 |  |  | 257,676 |
Eliminations |  | (1,783 | ) |  | (2,828 | ) |  | (8,804 | ) |  | (7,349 | )
Performance Materials & Chemicals |  | 288,319 |  |  | 277,072 |  |  | 844,302 |  |  | 765,781 |
Inter-segment sales eliminations(2) |  | (832 | ) |  | (784 | ) |  | (2,510 | ) |  | (2,568 | )
Total |  | $ | 427,203 |  |  | $ | 391,829 |  |  | $ | 1,228,113 |  |  | $ | 1,114,027 |
Segment Adjusted EBITDA:(3) |  |  |  |  |  |  |  |
Environmental Catalysts & Services(4) |  | $ | 65,309 |  |  | $ | 61,900 |  |  | $ | 188,594 |  |  | $ | 182,578 |
Performance Materials & Chemicals |  | 63,088 |  |  | 65,885 |  |  | 193,629 |  |  | 184,741 |
Total Segment Adjusted EBITDA(5) |  | $ | 128,397 |  |  | $ | 127,785 |  |  | $ | 382,223 |  |  | $ | 367,319 |
(1) | Excludes the Company’s proportionate share of sales from the Zeolyst International and Zeolyst C.V. joint ventures (collectively, the “Zeolyst Joint Venture”) accounted for using the equity method (see Note 10 to these condensed consolidated financial statements for further information). The proportionate share of sales is $32,297 and $37,622 for the three months ended September 30, 2018 and 2017, respectively. The proportionate share of sales is $120,159 and $100,991 for the nine months ended September 30, 2018 and 2017, respectively.
(2) | The Company eliminates intersegment sales when reconciling to the Company’s consolidated statements of operations.
(3) | The Company defines Adjusted EBITDA as EBITDA adjusted for certain items as noted in the reconciliation below. Management evaluates the performance of its segments and allocates resources based on several factors, of which the primary measure is Adjusted EBITDA. Adjusted EBITDA should not be considered as an alternative to net income as an indicator of the Company’s operating performance. Adjusted EBITDA as defined by the Company may not be comparable with EBITDA or Adjusted EBITDA as defined by other companies.
(4) | The Adjusted EBITDA from the Zeolyst Joint Venture included in the Environmental Catalysts and Services segment is $10,513 for the three months ended September 30, 2018, which includes $5,563 of equity in net income plus $1,658 of amortization of investment in affiliate step-up plus $3,292 of joint venture depreciation, amortization and interest. The Adjusted EBITDA from the Zeolyst Joint Venture included in the Environmental Catalysts and Services segment is $14,398 for the three months ended September 30, 2017, which includes $10,151 of equity in net income plus $1,658 of amortization of investment in affiliate step-up plus $2,563 of joint venture depreciation, amortization and interest.
The Adjusted EBITDA from the Zeolyst Joint Venture included in the Environmental Catalysts and Services segment is $45,194 for the nine months ended September 30, 2018, which includes $31,005 of equity in net income plus $4,975 of amortization of investment in affiliate step-up plus $9,214 of joint venture depreciation, amortization and interest. The Adjusted EBITDA from the Zeolyst Joint Venture included in the Environmental Catalysts and Services segment is $39,690 for the nine months ended September 30, 2017, which includes $24,594 of equity in net income plus $6,941 of amortization of investment in affiliate step-up plus $8,073 of joint venture depreciation, amortization and interest.
(5) | Total Segment Adjusted EBITDA differs from the Company’s consolidated Adjusted EBITDA due to unallocated corporate expenses.
Reconciliation of Net Loss to Segment Adjusted EBITDA | A reconciliation of net income (loss) attributable to PQ Group Holdings to Segment Adjusted EBITDA is as follows:
|  | Three months ended September 30, |  | Nine months ended September 30,
|  | 2018 |  | 2017 |  | 2018 |  | 2017
Reconciliation of net income (loss) attributable to PQ Group Holdings Inc. to Segment Adjusted EBITDA |  |  |  |  |  |  |  |
Net income (loss) attributable to PQ Group Holdings Inc. |  | $ | 14,185 |  |  | $ | (3,345 | ) |  | $ | 30,181 |  |  | $ | (7,408 | )
Provision for income taxes |  | 8,470 |  |  | 5,172 |  |  | 21,590 |  |  | 5,269 |
Interest expense, net |  | 28,238 |  |  | 49,079 |  |  | 84,622 |  |  | 144,041 |
Depreciation and amortization |  | 43,827 |  |  | 45,929 |  |  | 139,298 |  |  | 129,135 |
Segment EBITDA |  | 94,720 |  |  | 96,835 |  |  | 275,691 |  |  | 271,037 |
Unallocated corporate expenses |  | 10,276 |  |  | 7,885 |  |  | 27,322 |  |  | 23,474 |
Joint venture depreciation, amortization and interest |  | 3,292 |  |  | 2,563 |  |  | 9,214 |  |  | 8,073 |
Amortization of investment in affiliate step-up |  | 1,658 |  |  | 1,658 |  |  | 4,975 |  |  | 6,941 |
Amortization of inventory step-up |  | — |  |  | — |  |  | 1,603 |  |  | 871 |
Debt extinguishment costs |  | 864 |  |  | 453 |  |  | 6,743 |  |  | 453 |
Net loss on asset disposals |  | 5,202 |  |  | 3,494 |  |  | 11,106 |  |  | 6,419 |
Foreign currency exchange loss |  | 3,527 |  |  | 5,256 |  |  | 15,347 |  |  | 21,612 |
LIFO expense |  | 856 |  |  | 750 |  |  | 5,903 |  |  | 3,229 |
Management advisory fees |  | — |  |  | 1,250 |  |  | — |  |  | 3,750 |
Transaction and other related costs |  | 210 |  |  | 966 |  |  | 895 |  |  | 5,300 |
Equity-based and other non-cash compensation |  | 4,252 |  |  | 1,041 |  |  | 11,879 |  |  | 3,869 |
Restructuring, integration and business optimization expenses |  | 2,178 |  |  | 4,957 |  |  | 5,662 |  |  | 8,009 |
Defined benefit pension plan cost |  | 112 |  |  | 791 |  |  | 260 |  |  | 2,200 |
Other |  | 1,250 |  |  | (114 | ) |  | 5,623 |  |  | 2,082 |
Segment Adjusted EBITDA |  | $ | 128,397 |  |  | $ | 127,785 |  |  | $ | 382,223 |  |  | $ | 367,319 |

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- Definition Tabular disclosure of the reconciliation of profit (loss) from reportable segments to the consolidated income (loss) before income tax expense (benefit) and discontinued operations. Includes, but is not limited to, reconciliation after income tax if income tax is allocated to the reportable segment. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=115929826&loc=d3e8924-108599 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=115929826&loc=d3e8906-108599 + Details
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- Definition Tabular disclosure of all significant reconciling items in the reconciliation of total revenues from reportable segments to the entity's consolidated revenues. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=115929826&loc=d3e8924-108599 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=115929826&loc=d3e8906-108599 + Details
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