Quarterly report pursuant to Section 13 or 15(d)

RESTRUCTURING ACTIONS AND OTHER CHARGES RESTRUCTURING ACTIONS AND OTHER CHARGES (Tables)

v3.5.0.2
RESTRUCTURING ACTIONS AND OTHER CHARGES RESTRUCTURING ACTIONS AND OTHER CHARGES (Tables)
6 Months Ended
Jul. 03, 2016
Restructuring and Related Activities [Abstract]  
Schedule of Segment Reporting Information, by Segment
Restructuring actions and other charges were included in each segment in our operating results as follows:
In millions
Year ended December 31, 2015 (1)
Power Systems
26

Distribution
23

Engine
17

Components
13

Non-segment
11

Restructuring actions and other charges
$
90

____________________________________________________
(1) Restructuring actions and other charges by segment were re-allocated in conjunction with our segment realignment. See Note 13, "OPERATING SEGMENTS," for additional information.
Summarized financial information regarding our reportable operating segments for the three and six month periods is shown in the table below:
In millions
 
Engine
 
Distribution
 
Components
 
Power Systems
 
Non-segment
Items (1)
 
Total
Three months ended July 3, 2016
 
 

 
 
 
 

 
 

 
 

 
 

External sales
 
$
1,504

 
$
1,538

 
$
933

 
$
553

 
$

 
$
4,528

Intersegment sales
 
498

 
6

 
346

 
368

 
(1,218
)
 

Total sales
 
2,002

 
1,544

 
1,279

 
921

 
(1,218
)
 
4,528

Depreciation and amortization(2)
 
41

 
29

 
32

 
29

 

 
131

Research, development and engineering expenses
 
53

 
3

 
51

 
48

 

 
155

Equity, royalty and interest income from investees
 
46

 
19

 
12

 
11

 

 
88

Interest income
 
3

 
1

 
1

 
1

 

 
6

Segment EBIT
 
206

(3) 
87

 
190

 
90

 
18

 
591

 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended June 28, 2015
 
 

 
 

 
 

 
 

 
 

 
 

External sales
 
$
1,834

 
$
1,487

 
$
1,017

 
$
677

 
$

 
$
5,015

Intersegment sales
 
491

 
8

 
380

 
420

 
(1,299
)
 

Total sales
 
2,325

 
1,495

 
1,397

 
1,097

 
(1,299
)
 
5,015

Depreciation and amortization(2)
 
47

 
25

 
28

 
26

 

 
126

Research, development and engineering expenses
 
53

 
3

 
57

 
53

 

 
166

Equity, royalty and interest income from investees
 
51

 
21

 
8

 
14

 

 
94

Interest income
 
2

 
1

 
1

 
2

 

 
6

Segment EBIT
 
278

 
113

 
223

 
127

 
(20
)
 
721

 
 
 
 
 
 
 
 
 
 
 
 
 
Six months ended July 3, 2016
 
 

 
 

 
 

 
 

 
 

 
 

External sales
 
$
2,993

 
$
2,996

 
$
1,830

 
$
1,000

 
$

 
$
8,819

Intersegment sales
 
985

 
11

 
686

 
729

 
(2,411
)
 

Total sales
 
3,978

 
3,007

 
2,516

 
1,729

 
(2,411
)
 
8,819

Depreciation and amortization(2)
 
80

 
57

 
63

 
58

 

 
258

Research, development and engineering expenses
 
110

 
7

 
107

 
97

 

 
321

Equity, royalty and interest income from investees
 
82

 
37

 
20

 
21

 

 
160

Interest income
 
5

 
2

 
2

 
3

 

 
12

Segment EBIT
 
403

(3) 
174

 
353

 
136

 
9

 
1,075

 
 
 
 
 
 
 
 
 
 
 
 
 
Six months ended June 28, 2015
 
 

 
 

 
 

 
 

 
 

 
 

External sales
 
$
3,523

 
$
2,956

 
$
1,948

 
$
1,297

 
$

 
$
9,724

Intersegment sales
 
947

 
15

 
748

 
802

 
(2,512
)
 

Total sales
 
4,470

 
2,971

 
2,696

 
2,099

 
(2,512
)
 
9,724

Depreciation and amortization(2)
 
93

 
52

 
54

 
54

 

 
253

Research, development and engineering expenses
 
122

 
6

 
118

 
115

 

 
361

Equity, royalty and interest income from investees
 
74

 
41

 
17

 
30

 

 
162

Interest income
 
4

 
2

 
2

 
3

 

 
11

Segment EBIT
 
478

 
201

 
418

 
228

 
(42
)
 
1,283

____________________________________
(1) Includes intersegment sales, intersegment profit in inventory eliminations and unallocated corporate expenses. There were no significant unallocated corporate expenses for the three and six months ended July 3, 2016 and June 28, 2015.
(2) Depreciation and amortization as shown on a segment basis excludes the amortization of debt discount and deferred costs included in the Condensed Consolidated Statements of Income as "Interest expense." The amortization of debt discount and deferred costs were $1 million and $1 million for the six months ended July 3, 2016 and June 28, 2015, respectively.
Schedule of Restructuring and Related Costs Accrual Rollforward
The table below summarizes the activity and balance of accrued workforce reductions, which is included in "Other accrued expenses" in our Condensed Consolidated Balance Sheets:
In millions
 
 
Balance at December 31, 2015
 
$
60

Cash payments for 2015 actions
 
(42
)
Balance at July 3, 2016
 
$
18