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Schedule I - Condensed Financial Information Of Registrant | 12 Months Ended
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Dec. 31, 2011
Schedule I - Condensed Financial Information Of Registrant [Abstract] |
Schedule I - Condensed Financial Information Of Registrant | VALHI, INC. AND SUBSIDIARIES SCHEDULE I—CONDENSED FINANCIAL INFORMATION OF REGISTRANT Condensed Balance Sheets (In millions)
|  | December 31, |
|  | 2010 |  |  | 2011 |
Current assets: |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 1.3 |  |  | $ | 1.8 |
Restricted cash equivalents |  |  | .1 |  |  |  | — |
Accounts receivable |  |  | .3 |  |  |  | .1 |
Receivables from subsidiaries and affiliates: |  |  |  |  |  |  |  |
Income taxes, net |  |  | — |  |  |  | 7.2 |
Other |  |  | .8 |  |  |  | .9 |
Deferred income taxes |  |  | 1.3 |  |  |  | 1.5 |
Other |  |  | .2 |  |  |  | .1 |
Total current assets |  |  | 4.0 |  |  |  | 11.6 |
Other assets: |  |  |  |  |  |  |  |
Marketable securities |  |  | 264.2 |  |  |  | 262.4 |
Investment in and advances to subsidiaries |  |  | 1,004.2 |  |  |  | 1,156.6 |
Note receivable from affiliate |  |  | — |  |  |  | 11.2 |
Other assets |  |  | .4 |  |  |  | .3 |
Total other assets |  |  | 1,268.8 |  |  |  | 1,430.5 |
Total assets |  | $ | 1,272.8 |  |  | $ | 1,442.1 |
Current liabilities: |  |  |  |  |  |  |  |
Current maturities of long-term debt |  | $ | 30.1 |  |  | $ | — |
Payables to subsidiaries and affiliates: |  |  |  |  |  |  |  |
Income taxes, net |  |  | 4.5 |  |  |  | — |
Other |  |  | .1 |  |  |  | — |
Accounts payable and accrued liabilities |  |  | .8 |  |  |  | .6 |
Total current liabilities |  |  | 35.5 |  |  |  | .6 |
Noncurrent liabilities: |  |  |  |  |  |  |  |
Long-term debt |  |  | 311.9 |  |  |  | 386.1 |
Deferred income taxes |  |  | 362.7 |  |  |  | 392.9 |
Other |  |  | 20.9 |  |  |  | 5.3 |
Total noncurrent liabilities |  |  | 695.5 |  |  |  | 784.3 |
Stockholders' equity |  |  | 541.8 |  |  |  | 657.2 |
Total liabilities and stockholders' equity |  | $ | 1,272.8 |  |  | $ | 1,442.1 |
The accompanying Notes are an integral part of the financial statements. Condensed Statements of Operations (In millions)
|  | Years ended December 31, |
|  | 2009 |  |  | 2010 |  |  | 2011 |
Revenues and other income: |  |  |  |  |  |  |  |  |  |  |  |
Interest and dividend income |  | $ | 26.2 |  |  | $ | 26.1 |  |  | $ | 26.9 |
Equity in earnings of subsidiaries and affiliates |  |  | (60.5 | ) |  |  | 69.8 |  |  |  | 200.3 |
Gain on sale of business |  |  | 6.3 |  |  |  | — |  |  |  | — |
Other income, net |  |  | .1 |  |  |  | — |  |  |  | — |
Total revenues and other income |  |  | (27.9 | ) |  |  | 95.9 |  |  |  | 227.2 |
Costs and expenses: |  |  |  |  |  |  |  |  |  |  |  |
General and administrative |  |  | 6.3 |  |  |  | 5.7 |  |  |  | 6.0 |
Interest |  |  | 24.5 |  |  |  | 28.0 |  |  |  | 28.1 |
Total costs and expenses |  |  | 30.8 |  |  |  | 33.7 |  |  |  | 34.1 |
Income (loss) before income taxes |  |  | (58.7 | ) |  |  | 62.2 |  |  |  | 193.1 |
Provision for income taxes (benefit) |  |  | (24.5 | ) |  |  | 11.9 |  |  |  | (24.4 | )
Net income (loss) |  | $ | (34.2 | ) |  | $ | 50.3 |  |  | $ | 217.5 |
The accompanying Notes are an integral part of the financial statements. Condensed Statements of Cash Flows (In millions)
|  | Years ended December 31, |
|  | 2009 |  |  | 2010 |  |  | 2011 |
Cash flows from operating activities: |  |  |  |  |  |  |  |  |  |  |  |
Net income (loss) |  | $ | (34.2 | ) |  | $ | 50.3 |  |  | $ | 217.5 |
Deferred income taxes |  |  | .5 |  |  |  | 17.4 |  |  |  | 30.7 |
Gain on sale of business |  |  | (6.3 | ) |  |  | — |  |  |  | — |
Equity in earnings of subsidiaries and affiliates |  |  | 60.5 |  |  |  | (69.8 | ) |  |  | (200.3 | )
Cash dividends from subsidiaries |  |  | 31.2 |  |  |  | 28.9 |  |  |  | 82.6 |
Other, net |  |  | (.1 | ) |  |  | — |  |  |  | — |
Net change in assets and liabilities |  |  | (26.8 | ) |  |  | 22.0 |  |  |  | (24.1 | )
Net cash provided by operating activities |  |  | 24.8 |  |  |  | 48.8 |  |  |  | 106.4 |
Cash flows from investing activities: |  |  |  |  |  |  |  |  |  |  |  |
Loans to subsidiaries and affiliates: |  |  |  |  |  |  |  |  |  |  |  |
Loans |  |  | (55.2 | ) |  |  | (45.1 | ) |  |  | (126.8 | )
Collections |  |  | .6 |  |  |  | 38.1 |  |  |  | 33.4 |
Proceeds from sale of business |  |  | 6.7 |  |  |  | .5 |  |  |  | .3 |
Investment in other subsidiary |  |  | (5.5 | ) |  |  | (4.0 | ) |  |  | (3.4 | )
Other, net |  |  | (.8 | ) |  |  | — |  |  |  | .2 |
Net cash used in investing activities |  |  | (54.2 | ) |  |  | (10.5 | ) |  |  | (96.3 | )
|  | Years ended December 31, |
|  | 2009 |  |  | 2010 |  |  | 2011 |
Cash flows from financing activities: |  |  |  |  |  |  |  |  |  |  |  |
Indebtedness: |  |  |  |  |  |  |  |  |  |  |  |
Borrowings |  | $ | 70.7 |  |  | $ | — |  |  | $ | — |
Principal payments |  |  | (78.0 | ) |  |  | — |  |  |  | — |
Loans from affiliates: |  |  |  |  |  |  |  |  |  |  |  |
Borrowings |  |  | 99.6 |  |  |  | 237.1 |  |  |  | 214.7 |
Principal payments |  |  | (17.7 | ) |  |  | (230.0 | ) |  |  | (170.6 | )
Cash dividends paid |  |  | (45.4 | ) |  |  | (45.5 | ) |  |  | (53.7 | )
Net cash provided by (used in) financing activities |  |  | 29.2 |  |  |  | (38.4 | ) |  |  | (9.6 | )
Cash and cash equivalents: |  |  |  |  |  |  |  |  |  |  |  |
Net increase (decrease) |  |  | (.2 | ) |  |  | (.1 | ) |  |  | .5 |
Balance at beginning of year |  |  | 1.6 |  |  |  | 1.4 |  |  |  | 1.3 |
Balance at end of year |  | $ | 1.4 |  |  | $ | 1.3 |  |  | $ | 1.8 |
Supplemental disclosures: |  |  |  |  |  |  |  |  |  |  |  |
Cash paid (received) for: |  |  |  |  |  |  |  |  |  |  |  |
Interest |  | $ | 24.5 |  |  | $ | 27.9 |  |  | $ | 28.2 |
Income taxes, net |  |  | .5 |  |  |  | (28.5 | ) |  |  | (32.1 | )
Noncash investing activity— |  |  |  |  |  |  |  |  |  |  |  |
Note receivable from sale of business |  |  | .8 |  |  |  | — |  |  |  | — |
The accompanying Notes are an integral part of the financial statements. NOTES TO CONDENSED FINANCIAL INFORMATION December 31, 2011 Note 1—Basis of presentation: We have prepared the accompanying Financial Statements on a "Parent Company" basis. This means that our investments in the common stock or membership interest of our majority and wholly-owned subsidiaries, including NL Industries, Inc., Kronos Worldwide, Inc., Tremont LLC, Medite Corporation and Waste Control Specialists LLC, are presented on the equity method of accounting. Our Consolidated Financial Statements and the Notes thereto, which include the financial position, results of operations and cash flows of these subsidiaries, are incorporated by reference into these Parent Company Financial Statements. Note 2—Investment in and advances to subsidiaries:
|  | December 31, |
|  | 2010 |  |  | 2011 |
Investment in: |  |  |  |  |  |  |  |
Kronos Worldwide, Inc. (NYSE: KRO) |  | $ | 599.3 |  |  | $ | 666.8 |
NL Industries (NYSE: NL) |  |  | 328.9 |  |  |  | 374.0 |
Waste Control Specialists LLC |  |  | 49.6 |  |  |  | 97.4 |
Tremont LLC |  |  | 15.4 |  |  |  | 14.8 |
Medite |  |  | (.3 | ) |  |  | (.5 | )
Total |  |  | 992.9 |  |  |  | 1,152.5 |
Loans to NL Industries |  |  | 11.3 |  |  |  | 4.1 |
Total |  | $ | 1,004.2 |  |  | $ | 1,156.6 |
In November 2010, Kronos completed a secondary public offering of 17.94 million shares of its common stock in an underwritten offering for net proceeds of $337.6 million. The price to the public was $20.00 per share, and the underwriting discount was 5.75% (or $1.15 per share). Costs of the offering (exclusive of the underwriting discount) were approximately $.7 million. The shares of Kronos common stock issued in the secondary offering are identical to the previously issued outstanding shares in all respects, including par value, liquidation and dividend preference. All shares were sold to third-party investors. Upon completion of the offering, our aggregate ownership of Kronos was reduced to 80% (50% held directly by us and 30% held directly by NL). Under the provisions of ASC Topic 810, changes in parent control that do not lead to deconsolidation are considered equity transactions recognized through APIC and noncontrolling interest, accordingly no gain or loss was recognized on this transaction. In May 2011, Kronos implemented a 2-for-1 split of its common stock. We have adjusted all share and per-share disclosures related to our investment in Kronos for all periods presented to give effect to the stock split. The stock split had no financial statement impact to us, and our ownership interest in Kronos did not change as a result of the split. See Note 3 to our Consolidated Financial Statements. We have an unsecured revolving demand promissory note with NL whereby, as amended, we agreed to loan NL up to $40 million. Our loan to NL bears interest at prime plus 2.75% (6.0% at December 31, 2011), payable quarterly, with all principal due on demand, but in any event no earlier than December 31, 2013. The amount of our outstanding loans to NL at any time is at our discretion. NL paid $.2 million and $.3 million in interest to us in 2010 and 2011, respectively. All such intercompany interest income is eliminated in the Consolidated Financial Statements. As of December 31, 2010 and 2011, we had loans outstanding to NL of $11.3 million and $4.1 million, respectively, which loans are also eliminated in the Consolidated Financial Statements.
|  | Years ended December 31, |
|  | 2009 |  |  | 2010 |  |  | 2011 |
|  | (In millions) |
Equity in earnings of subsidiaries and affiliates |  |  |  |  |  |  |  |  |  |  |  |
Kronos Worldwide |  | $ | (21.6 | ) |  | $ | 73.8 |  |  | $ | 159.3 |
NL Industries |  |  | (16.9 | ) |  |  | 28.2 |  |  |  | 84.5 |
Waste Control Specialists LLC |  |  | (27.6 | ) |  |  | (31.9 | ) |  |  | (42.5 | )
Tremont LLC |  |  | 6.0 |  |  |  | (.2 | ) |  |  | (.8 | )
Medite |  |  | (.4 | ) |  |  | (.1 | ) |  |  | (.2 | )
Total |  | $ | (60.5 | ) |  | $ | 69.8 |  |  | $ | 200.3 |
Cash dividends from subsidiaries |  |  |  |  |  |  |  |  |  |  |  |
Kronos Worldwide |  | $ | — |  |  | $ | 7.3 |  |  | $ | 62.3 |
NL Industries |  |  | 20.2 |  |  |  | 20.2 |  |  |  | 20.2 |
Tremont LLC |  |  | 11.0 |  |  |  | 1.4 |  |  |  | .1 |
Total |  | $ | 31.2 |  |  | $ | 28.9 |  |  | $ | 82.6 |
Note 3—Notes receivable from affiliates: From time to time, we will have loans and advances outstanding between us and various related parties pursuant to term and demand notes. We generally enter into these loans and advances for cash management purposes. When we loan funds to related parties, we are generally able to earn a higher rate of return on the loan than we would earn if we invested the funds in other instruments, and when we borrow from related parties, we are generally able to pay a lower rate of interest than we would pay if we had incurred third-party indebtedness. While certain of these loans to affiliates may be of a lesser credit quality than cash equivalent instruments otherwise available to us, we believe we have considered the credit risks in the terms of the applicable loans. In this regard, in December 2011, we entered into an unsecured revolving demand promissory note with Contran whereby we agreed to loan Contran up to $30 million. Our loan to Contran bears interest at prime plus 3.0% (6.25% at December 31, 2011), payable quarterly, with all principal due on demand, but in any event no earlier than December 31, 2013. The amount of our outstanding loans to Contran at any time is at our discretion. As of December 31, 2011, we had loans outstanding to Contran of $11.2 million, and interest income on our loan to Contran was $36,000 in 2011. Note 4—Long-term debt:
|  | December 31, |
|  | 2010 |  |  | 2011 |
Snake River Sugar Company |  | $ | 250.0 |  |  | $ | 250.0 |
Kronos credit facility |  |  | 61.9 |  |  |  | 136.1 |
Promissory note payable to Waste Control Specialists |  |  | 30.1 |  |  |  | — |
Total |  |  | 342.0 |  |  |  | 386.1 |
Less current maturities |  |  | 30.1 |  |  |  | — |
Total long-term debt |  | $ | 311.9 |  |  | $ | 386.1 |
Our $250 million in loans from Snake River Sugar Company are collateralized by our interest in The Amalgamated Sugar Company LLC. The loans bear interest at a weighted average fixed interest rate of 9.4% and are due in January 2027. At December 31, 2011, $37.5 million of the loans are recourse to us and the remaining $212.5 million is nonrecourse to us. Under certain conditions, Snake River has the ability to accelerate the maturity of these loans. See Note 4 to our Consolidated Financial Statements We have an unsecured revolving credit facility with Kronos which, as amended, provides for borrowings from Kronos of up to $225 million. The facility bears interest at prime plus 1.0% (4.25% at December 31, 2011), and is due on demand, but in any event no earlier than December 31, 2013. Interest expense on our borrowings from Kronos were $.5 million and $3.7 million in 2010 and 2011, respectively. All such intercompany interest is eliminated in our Consolidated Financial Statements. As of December 31, 2010 and 2011, we had loans outstanding from Kronos of $61.9 million and $136.1 million, respectively, which loans are also eliminated in the Consolidated Financial Statements. At December 31, 2011 $88.9 million was available for borrowings under the facility. We also have an unsecured revolving credit facility with Contran which provides for borrowings from Contran of up to $100 million. The facility, as amended, bears interest at prime rate plus 1%, and is due on demand, but in any event no earlier than December 31, 2013. Valhi pays an unused commitment fee quarterly to Contran on the available balance. At December 31, 2011, no amounts were outstanding under the Contran credit facility and $100 million was available for borrowings. Note 5—Income taxes: The Amalgamated Sugar Company LLC is treated as a partnership for federal income tax purposes. Valhi Parent Company's provision for income taxes (benefit) includes a tax benefit attributable to Valhi's equity in losses of Waste Control Specialists, as recognition of such income tax benefit is not appropriate at the Waste Control Specialist level.
|  | Years ended December 31, |
|  | 2009 |  |  | 2010 |  |  | 2011 |
|  | (In millions) |
Components of provision for income taxes (benefit): |  |  |  |  |  |  |  |  |  |  |  |
Currently refundable |  | $ | (15.6 | ) |  | $ | (10.7 | ) |  | $ | (43.8 | )
Deferred income taxes (benefit) |  |  | (8.9 | ) |  |  | 22.6 |  |  |  | 19.4 |
Total |  | $ | (24.5 | ) |  | $ | 11.9 |  |  | $ | (24.4 | )
Cash paid (received) for income taxes, net: |  |  |  |  |  |  |  |  |  |  |  |
Subsidiaries |  | $ | (1.9 | ) |  | $ | (12.5 | ) |  | $ | (42.5 | )
Contran |  |  | 2.2 |  |  |  | (16.1 | ) |  |  | 10.3 |
Tax authorities |  |  | .2 |  |  |  | .1 |  |  |  | .1 |
Total |  | $ | .5 |  |  | $ | (28.5 | ) |  | $ | (32.1 | )
|  | December 31, |
|  | 2010 |  |  | 2011 |
|  | (In millions) |
Components of the net deferred tax asset (liability)—tax effect of temporary differences related to: |  |  |  |  |  |  |  |
Investment in: |  |  |  |  |  |  |  |
The Amalgamated Sugar Company LLC |  | $ | (120.7 | ) |  | $ | (137.0 | )
Kronos Worldwide |  |  | (243.9 | ) |  |  | (243.9 | )
Federal and state loss carryforwards and other income tax attributes |  |  | 13.8 |  |  |  | 1.0 |
Accrued liabilities and other deductible differences |  |  | 4.2 |  |  |  | 2.5 |
Valuation allowance |  |  | (2.7 | ) |  |  | (2.0 | )
Other taxable differences |  |  | (12.1 | ) |  |  | (12.0 | )
Total |  | $ | (361.4 | ) |  | $ | (391.4 | )
Current deferred tax asset |  | $ | 1.3 |  |  | $ | 1.5 |
Noncurrent deferred tax liability |  |  | (362.7 | ) |  |  | (392.9 | )
Total |  | $ | (361.4 | ) |  | $ | (391.4 | )

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- Definition The entire disclosure for condensed financial information, including the financial position, cash flows, and the results of operations of the registrant (parent company) as of the same dates or for the same periods for which audited consolidated financial statements are being presented. Alternatively, the details of this disclosure can be reported by the specific parent company taxonomy elements, indicating the appropriate date and period contexts in an instance document. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Article 9 -Section 06 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Article 7 -Section 05 -Paragraph c Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 04 -Paragraph c -Article 5 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 3 -Subparagraph (SX 210.12-04) -URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e24072-122690 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Accounting Research Bulletin (ARB) -Number 51 -Paragraph 24 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 04 -Article 12 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 45 -Paragraph 11 -URI http://asc.fasb.org/extlink&oid=6921628&loc=d3e5283-111683 + Details
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