DELPHI 2015 Annual Report Download - page 69

Table of Contents
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during the year ended December 31, 2014 for the initiation of a new restructuring program at a European manufacturing site
within the Powertrain Systems segment in the second quarter of 2014. Restructuring expenses recorded during the year ended
December 31, 2013 were primarily attributable to the initiation of various restructuring actions, primarily in Europe, in the
fourth quarter of 2012 and in the first quarter of 2013. These restructuring actions were initiated in response to lower OEM
production volumes in Europe and continued economic uncertainties, and included workforce reductions, as well as plant
closures, and were substantially completed during 2014.
Refer to Note 10. Restructuring to the audited consolidated financial statements included herein for additional
information.
Interest Expense
Year Ended December 31,
2014 2013
Favorable/
(unfavorable)
(in millions)
Interest expense........................................................................................................... $ 135 $ 143 $ 8
The decrease in interest expense for the year ended December 31, 2014 as compared to the year ended December 31,
2013 reflects a reduction in interest expense from the repayment of a portion of the Tranche A Term Loan and the redemption
of the 5.875% Senior Notes, offset by the issuance of $700 million of the 4.15% 2014 Senior Notes in the first quarter of 2014.
Refer to Note 11. Debt to the audited consolidated financial statements included herein for additional information.
Other Income, Net
Year Ended December 31,
2014 2013
Favorable/
(unfavorable)
(in millions)
Other (expense) income, net ....................................................................................... $(8) $ (18) $ 10
Other income, net was impacted as a result of Delphi repaying a portion of the Tranche A Term Loan and redeeming the
5.875% Senior Notes during the year ended December 31, 2014, resulting in a loss on extinguishment of debt of $34 million.
Additionally, during the year ended December 31, 2014, Delphi incurred approximately $6 million in transaction costs related
to its 2014 acquisitions. Partially offsetting these expenses, during the year ended December 31, 2014, Delphi recorded $10
million of interest income and also reached a final settlement with its insurance carrier related to a business interruption
insurance claim, and received proceeds from the settlement of approximately $14 million, net of related costs and expenses.
During the year ended December 31, 2013, Delphi amended its Credit Agreement and repaid the entire balance of the
Tranche B Term Loan from the Original Credit Agreement, resulting in a loss on extinguishment of debt of $39 million.
Refer to Note 19. Other income, net and Note 11. Debt to the audited consolidated financial statements included herein
for additional information.
Income Taxes
Year Ended December 31,
2014 2013
Favorable/
(unfavorable)
(in millions)
Income tax expense..................................................................................................... $ 255 $ 240 $ (15)
The Company’s tax rate is affected by the tax rates in the jurisdictions in which the Company operates, the relative
amount of income earned by jurisdiction and the relative amount of losses or income for which no tax benefit or expense was
recognized due to a valuation allowance.
The effective tax rate was 16% and 16% for the years ended December 31, 2014 and 2013, respectively. The effective tax
rate in the year ended December 31, 2014 was impacted by favorable geographic income mix in 2014 as compared to 2013,