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2013 Annual Report
What matters.

Table of contents

  • Page 1
    What matters. 2013 Annual Report

  • Page 2

  • Page 3
    At the forefront of the megatrends of safe, green and connected, we deliver solutions to what people want and the world needs. 1

  • Page 4
    ... the driving experience-reducing driver workload and distractions while enhancing collision avoidance and mitigation with the latest in radar, vision and highperformance safety technologies. And, we're bringing these advances into the volume vehicle market, with affordable state-of-the-art solutions...

  • Page 5
    What if vehicle emissions approached zero? We're headed there. GREEN It's a matter of global consensus: legislation and regulations require the automotive industry to make revolutionary progress in fuel economy and emissions control. And we are at the forefront of this initiative. So while meeting ...

  • Page 6
    ... electronics device you own is your car, with as many as 50 computers handling everything from controlling engine performance to keeping you safe, comfortable and informed. And today, we're starting to take integrated, intelligent, automated driver assistance to new levels of distraction-free...

  • Page 7
    Keeping pace with the velocity of change, anticipating new and better ways of driving, growing as the world grows, we continue to set the standards going forward. 5

  • Page 8
    The Delphi team created significant value ...by focusing on what matters-executing industry leading solutions for customers and consumers making the world safer, greener and more connected. RODNEY O'NEAL Chief Executive Officer and President 6

  • Page 9
    ... Shareholders 2013 was a banner year for our company. The Delphi team created significant value for you, our shareholder, by focusing on what matters - executing industry leading solutions for customers and consumers making the world safer, greener and more connected. What Matters: Solid Financial...

  • Page 10
    ... two weeks in China reviewing their supplier base and had come away from that visit amazed with Delphi's scale and capabilities. He complimented Delphi for having "created a world-class automotive supply company perfectly positioned for the local market. " His words highlight why Delphi has been so...

  • Page 11
    ...Electrical / Electronic Architecture 4,424 2,830 1,468 Powertrain Systems Electronics & Safety Thermal Systems 1 Amounts include intercompany sales which are eliminated in consolidation 2013 Net Sales by Region (US$ Billions) 5.5 NORTH AMERICA 6.5 EUROPE, MIDDLE EAST, AFRICA 3.5 ASIA PACIFIC...

  • Page 12
    ... 4% South America 29% Asia Pacific 39% Europe 33% Europe 33% North America 34% North America Delphi business segments Electrical/Electronic Architecture Provides complete vehicle electrical architecture systems, integrating wiring and cable assemblies, electrical centers and connection systems...

  • Page 13
    ... Companies to Watch in Automated Driving Innovations. Given the Supplier of the Year 2013 Automotive Interiors Expo Award by an independent jury of 14 international automobile journalists, placing Delphi among the world's top designers and innovators in automotive interiors. Delphi Connect product...

  • Page 14
    ... and vice versa - bringing low cost emissions control to diesel and free-breathing efficiency to gas engines. A new gas combustion technology, gasoline direct injection compression ignition or GDCI, allows unthrottled operation without excessive NOx production. In diesel, stoichiometric combustion...

  • Page 15
    13

  • Page 16
    14

  • Page 17
    ...being able to make that technology automotive grade and make it work seamlessly for the driver is where we excel. Our partners and customers know Delphi can design advanced solutions and deliver them ï¬,awlessly everywhere they are needed - in China and Brazil just as in North America and Europe. We...

  • Page 18
    ... on its growth, adding a third tech center and having added three plants this year - at immediate full capacity. And, the plan is that more will follow. Our new EMS technical center in Beijing increases our design capabilities, and we continue to add to our manufacturing capacity to serve the...

  • Page 19
    17

  • Page 20
    18

  • Page 21
    ... ON OUR PEOPLE Our culture propels us forward At Delphi, we built our business around the megatrends of safe, green and connected. This is worthy work, creating solutions that improve people's lives, drive economic development and make a positive impact on the planet. And it aligns perfectly...

  • Page 22
    ... on a sales basis since 2009. We are relentless in creating new products to help keep the planet greener and people safer and more connected while driving. Lower emissions, improved fuel economy and vehicle weight reduction are just a few areas we focus on to help vehicle manufacturers meet stricter...

  • Page 23
    ... as of June 28, 2013, the last business day of the registrant's most recently completed second fiscal quarter, was $15,623,292,731 (based on the closing sale price of the registrant's ordinary shares on that date as reported on the New York Stock Exchange). The number of the registrant's ordinary...

  • Page 24
    ... Mine Safety Disclosure Part II Item 5. Item 6. Item 7. Item 7A. Item 8. Item 9. Item 9A. Item 9B. Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Selected Financial Data Management's Discussion and Analysis of Financial Condition and...

  • Page 25
    ... to current events and financial performance. Such forward-looking statements are subject to many risks, uncertainties and factors relating to the Company's operations and business environment, which may cause the actual results of the Company to be materially different from any future results...

  • Page 26
    ... complete design of the vehicle's electrical architecture, including connectors, wiring assemblies and harnesses, electrical centers and hybrid high voltage and safety distribution systems. Our products provide the critical electrical and electronics backbone that supports increased vehicle content...

  • Page 27
    ... Data of this Annual Report for further financial information about business segments. Our business is diversified across end-markets, regions, customers, vehicle platforms and products. Our customer base includes all 25 of the largest automotive OEMs in the world, and, in 2013, 27% of our net sales...

  • Page 28
    ...to the devices and cloud based content and services. Delphi's MyFi then couples active safety products to monitor the environment inside and outside the vehicle to help enable connectivity in a safer environment. Coupled with alerts, audio commands and responses, driver awareness can be enhanced and...

  • Page 29
    .... Distribution systems, including hybrid high voltage and safety systems, are integrated into one optimized vehicle electrical system that can utilize smaller cable and gauge sizes and ultra-thin wall insulation (which product line makes up approximately 36% of our total revenue for the year ended...

  • Page 30
    ... generally require that we demonstrate improved efficiencies, through cost reductions and/or price improvement, on a year-over-year basis. Our competitors in each of our operating segments are as follows: Segment Electrical/Electronic Architecture Powertrain Systems Electronics and Safety Thermal...

  • Page 31
    ... specific and authorized customer purchase order releases placed with our manufacturing and distribution centers for actual production and order fulfillment. Firm orders are typically fulfilled as promptly as possible from the conversion of available raw materials, sub-components and work-in-process...

  • Page 32
    Our Global Operations Information concerning principal geographic areas for our continuing operations is set forth below. Net sales data reflects the manufacturing location for the years ended December 31, 2013, 2012 and 2011. Net property data is as of December 31, 2013, 2012 and 2011. Year ended ...

  • Page 33
    ... costs, seeking alternative product designs and material specifications, combining our purchase requirements with our customers and/or suppliers, changing suppliers, hedging of certain commodities and other means. In the case of copper, which primarily affects our Electrical/Electronic Architecture...

  • Page 34
    ... of Delphi Electrical/Electronic Architecture (E/EA) effective February 2012. He also continues to serve as president of Delphi Asia-Pacific. Mr. Abulaban was most recently president of the Connection Systems product business unit for Delphi E/EA. Mr. Abulaban was appointed managing director...

  • Page 35
    .... Earlier, Mr. Vijayvargiya was global business line executive (BLE) for Body Security & Mechatronics at Delphi Electrical/Electronic Architecture. Prior to his BLE assignment, Mr. Vijayvargiya was director of program management before being named product line manager of Audio Systems in 2002. 13

  • Page 36
    ... borrowing costs have negatively impacted global automotive sales and resulted in lower production volumes in the past. Substantial declines in automotive sales and production by our customers could have a material adverse effect on our business, results of operations and financial condition. A drop...

  • Page 37
    ... components supplied for particular vehicles. In most instances our OEM customers agree to purchase their requirements for specific products but are not required to purchase any minimum amount of products from us. The contracts we have entered into with most of our customers have terms ranging...

  • Page 38
    ... manufacturers in the automotive industry, ship products to our customers' vehicle assembly plants throughout the world so they are delivered on a "just-in-time" basis in order to maintain low inventory levels. Our suppliers also use a similar method. However, this "just-in-time" method makes...

  • Page 39
    We operate in the highly competitive automotive supply industry. The global automotive component supply industry is highly competitive. Competition is based primarily on price, technology, quality, delivery and overall customer service. There can be no assurance that our products will be able to ...

  • Page 40
    ... plans, which generally provide benefits based on negotiated amounts for each year of service. Our primary funded non-U.S. plans are located in Mexico and the United Kingdom and were underfunded by $447 million as of December 31, 2013. The funding requirements of these benefit plans, and the related...

  • Page 41
    ... in Asia Pacific, Eastern and Western Europe, South America and Northern Africa. We also purchase raw materials and other supplies from many different countries around the world. For the year ended December 31, 2013, approximately 68% of our net revenue came from sales outside the United States...

  • Page 42
    ... operation of information technology and telecommunications systems. We rely on these systems to make a variety of day-to-day business decisions as well as to track transactions, billings, payments and inventory. Our systems, as well as those of our customers, suppliers, partners, and service...

  • Page 43
    ... business. OEMs also require their suppliers to guarantee or warrant their products and bear the costs of repair and replacement of such products under new vehicle warranties. Depending on the terms under which we supply products to a vehicle manufacturer, a vehicle manufacturer may attempt to hold...

  • Page 44
    ... number of the markets we serve. Developments or assertions by or against us relating to intellectual property rights could negatively impact our business. Significant technological developments by others also could materially and adversely affect our business and results of operations and financial...

  • Page 45
    ... the regional distribution of our major manufacturing sites by the operating segment that uses such facilities: North America Europe, Middle East & Africa Asia Pacific South America Total Electrical/Electronic Architecture ...Powertrain Systems ...Electronics and Safety ...Thermal Systems ...Total...

  • Page 46
    ... and develop footprint strategies to support our customers' global plans, while at the same time supporting our technical needs and controlling operating expenses. We believe our evolving portfolio will meet current and anticipated future needs. ITEM 3. LEGAL PROCEEDINGS We are from time to time...

  • Page 47
    ... been publicly traded since November 17, 2011 when our ordinary shares were listed and began trading on the New York Stock Exchange ("NYSE") under the symbol "DLPH". The following table sets forth the high and low sales price per share of our ordinary shares, as reported by NYSE, for 2012 and 2013...

  • Page 48
    ... Automotive Supplier Peer Group - Russell 3000 Auto Parts Index, including American Axle & Manufacturing, BorgWarner Inc., Cooper Tire & Rubber Company, Dana Holding Corp., Delphi Automotive PLC, Dorman Products Inc., Federal-Mogul Corp., Ford Motor Co., Fuel Systems Solutions Inc., General Motors...

  • Page 49
    ...no exercise price. (3) Remaining shares available under the PLC LTIP. Repurchase of Equity Securities A summary of our ordinary shares repurchased during the quarter ended December 31, 2013, is shown below: Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate...

  • Page 50
    ...7. Management's Discussion and Analysis of Financial Condition and Results of Operations and the consolidated financial statements and notes thereto included elsewhere in this Annual Report. The financial information presented may not be indicative of our future performance. Successor (1) Year ended...

  • Page 51
    ... of the Motorized Vehicles Division ("MVL"). MVL is a leading global manufacturer of automotive connection systems with a focus on high-value, leading technology applications. Given the timing of the acquisition it is not fully reflected in our 2012 results and impacts comparability to 2013 results...

  • Page 52
    ...MD&A") is intended to help you understand the business operations and financial condition of the Company for the three year period ended December 31, 2013. This discussion should be read in conjunction with Item 8. Financial Statements and Supplementary Data. Our MD&A is presented in seven sections...

  • Page 53
    ... be successful. Collaboration with customers in our 15 major technical centers around the world helps us develop innovative product solutions designed to meet their needs. As more OEMs design vehicles for global platforms, where the same vehicle architecture is shared among different regions, we are...

  • Page 54
    ...global information network. Our Electrical/Electronic Architecture and Electronics and Safety segments are benefiting from the substantial increase in vehicle content and electrification requiring a complex and reliable electrical architecture and systems to operate, such as hybrid power electronics...

  • Page 55
    ... global vehicle components industry is generally capital intensive and a portion of a supplier's capital equipment is frequently utilized for specific customer programs. Lead times for procurement of capital equipment are long and typically exceed start of production by one to two years. Substantial...

  • Page 56
    ... cost exposures using a number of approaches, including combining purchase requirements with customers and/or other suppliers, using alternate suppliers or product designs, negotiating cost reductions and/or commodity cost contract escalation clauses into our vehicle manufacturer supply contracts...

  • Page 57
    ... 944 Total net sales for the year ended December 31, 2013 increased 6% compared to the year ended December 31, 2012. We experienced volume growth of 3% for the period as a result of increased sales in North America and Asia Pacific, partially offset by continued OEM production volume reductions in...

  • Page 58
    ... of property of approximately $11 million from the sale of a manufacturing site that was closed as a result of Delphi's overall restructuring program. Selling, General and Administrative Expense Year Ended December 31, 2013 2012 (dollars in millions) Favorable/ (unfavorable) Selling, general and...

  • Page 59
    ... of transaction costs of $13 million incurred in 2012 related to the acquisition of MVL. 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, 2013 2012 (in millions...

  • Page 60
    ... component and systems integration expertise in infotainment and connectivity, body controls and security systems, displays, mechatronics, passive and active safety electronics and electric and hybrid electric vehicle power electronics, as well as advanced development of software. Thermal Systems...

  • Page 61
    ... and other acquisition-related costs. The reconciliation of Adjusted EBITDA to net income attributable to Delphi for the years ended December 31, 2013 and 2012 are as follows: Electrical/ Electronic Architecture Powertrain Systems Electronics and Safety Thermal Systems Eliminations and Other...

  • Page 62
    ... are increased sales of approximately $695 million related to the net impact of acquisitions and divestitures. Gross Margin Percentage by Segment Year Ended December 31, 2013 2012 Electrical/Electronic Architecture ...Powertrain Systems ...Electronics and Safety ...Thermal Systems ...Eliminations...

  • Page 63
    ... in October 2012. Cost of Sales Cost of sales is primarily comprised of material, labor, manufacturing overhead, freight, fluctuations in foreign currency exchange rates, product engineering, design and development expenses, depreciation and amortization, warranty costs and other operating expenses...

  • Page 64
    ... of net sales... 927 $ 6.0% 901 $ 5.6% (26) Selling, general and administrative expense ("SG&A") includes administrative expenses, information technology costs and incentive compensation related costs, and increased as a percent of sales during the year ended December 31, 2012 compared to...

  • Page 65
    ...initial public offering, partially offset by transaction costs of $13 million in 2012 related to the acquisition of MVL and lower interest income. Refer to Note 19. Other income, net to the audited consolidated financial statements included herein for additional information. Income Taxes Year Ended...

  • Page 66
    ...the first quarter of 2013. As a result, the Company did not recognize a tax benefit of approximately $22 million in 2012 related to the research and development credit which favorably impacted the first quarter results in 2013. Equity Income Year Ended December 31, 2012 2011 (in millions) Favorable...

  • Page 67
    ... and other acquisition-related costs. The reconciliation of Adjusted EBITDA to net income attributable to Delphi for the years ended December 31, 2012 and 2011 are as follows: Electrical/ Electronic Architecture Powertrain Systems Electronics and Safety Thermal Systems Eliminations and Other...

  • Page 68
    ... are increased sales of approximately $110 million related to the net impact of acquisitions and divestitures. Gross Margin Percentage by Segment Year Ended December 31, 2012 2011 Electrical/Electronic Architecture ...Powertrain Systems ...Electronics and Safety ...Thermal Systems ...Eliminations...

  • Page 69
    ... for our initial public offering. Refer to Note 15. Shareholders' Equity and Net Income Per Share to the audited consolidated financial statements for additional information. In August 2011, the Board of Managers of Delphi Automotive LLP approved a repurchase program of Class B membership interests...

  • Page 70
    ... global manufacturer of automotive connection systems with a focus on high-value, leading technology applications. Upon completing the acquisition, Delphi incurred related transaction expenses totaling approximately $13 million. The cash payments required to close the transaction were funded using...

  • Page 71
    ... basis using information available, in the fourth quarter of 2012. The purchase price and related allocation were finalized in the three months ended March 31, 2013. The operating results of MVL are reported within the Electrical/Electronic Architecture segment from the date of acquisition...

  • Page 72
    ...all such collateral was released in the first quarter of 2014. The Credit Agreement requires that such security interests be reinstated if neither Delphi Automotive PLC nor Delphi Corporation have investment grade ratings from Standard & Poor's Rating Service or Moody's Investor Service. In addition...

  • Page 73
    ... Federal agencies in the year ended December 31, 2013 for work performed. These programs supplement our internal research and development funds and directly support our product focus of Safe, Green and Connected. We continue to pursue many technology development programs by bidding on competitively...

  • Page 74
    ... were: Year ended December 31, 2013 2013 2012 (in millions) 2011 Electrical/Electronic Architecture ...$ Powertrain Systems ...Electronics and Safety ...Thermal Systems ...Eliminations and Other...Total capital expenditures ...$ North America ...$ Europe, Middle East & Africa...Asia Pacific...South...

  • Page 75
    ... generally provide benefits based on negotiated amounts for each year of service. Our primary non-U.S. plans are located in France, Germany, Mexico, Portugal and the United Kingdom. The United Kingdom and certain Mexican plans are funded. In addition, we have defined benefit plans in South Korea...

  • Page 76
    ... and business strategies. Other estimates used in determining fair value include, but are not limited to, future cash flows or income related to intangibles, market rate assumptions, actuarial assumptions for benefit plans and appropriate discount rates. Our estimates of fair value are based upon...

  • Page 77
    ... actuarial estimated and related actuarial methods to calculate our obligation and expense. We are required to select certain actuarial assumptions, which are determined based on current market conditions, historical information and consultation with and input from our actuaries and asset managers...

  • Page 78
    ...key factors which impact our estimates are (1) future production estimates; (2) customer preferences and decisions; (3) product pricing; (4) manufacturing and material cost estimates; and (5) product life / business retention. Any differences in actual results from the estimates could result in fair...

  • Page 79
    ... events or otherwise, could have a material impact on our financial condition and results of operations. We calculate our current and deferred tax provision based on estimates and assumptions that could differ from the actual results reflected in income tax returns filed in subsequent years...

  • Page 80
    ..., which could materially impact the Company's future results of operations and financial condition. We expensed the estimated fair value of the Value Creation Plan (the "VCP"), a long-term incentive plan for key employees (as defined and further discussed in Note 21. Share-Based Compensation to the...

  • Page 81
    ... Activities to the audited consolidated financial statements included herein. We maintain risk management control systems to monitor exchange and commodity risks and related hedge positions. Positions are monitored using a variety of analytical techniques including market value and sensitivity...

  • Page 82
    ... changes in the Alternate Base Rate, LIBOR or future changes in our corporate credit ratings. The table below indicates interest rate sensitivity on interest expense to floating rate debt based on amounts outstanding as of December 31, 2013. Tranche A Term Loan (impact to annual interest expense in...

  • Page 83
    ..., presents fairly in all material respects the information set forth therein. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Delphi Automotive PLC's internal control over financial reporting as of December 31, 2013, based on...

  • Page 84
    ... opinion, Delphi Automotive PLC maintained, in all material respects, effective internal control over financial reporting as of December 31, 2013, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the...

  • Page 85
    ...AUTOMOTIVE PLC CONSOLIDATED STATEMENTS OF OPERATIONS Year Ended December 31, 2013 2012 2011 (in millions, except per share amounts) Net sales ...Operating expenses: Cost of sales ...Selling, general and administrative...Amortization ...Restructuring (Note 10) ...Total operating expenses...Operating...

  • Page 86
    DELPHI AUTOMOTIVE PLC CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Year Ended December 31, 2013 2012 (in millions) 2011 Net income ...$ 1,301 $ 1,160 $ 1,223 Other comprehensive income (loss): (94) Currency translation adjustments...49 60 (12) (98) Net change in unrecognized (loss) ...

  • Page 87
    DELPHI AUTOMOTIVE PLC CONSOLIDATED BALANCE SHEETS December 31, 2013 2012 (in millions) ASSETS Current assets: Cash and cash equivalents...Restricted cash ...Accounts receivable, net ...Inventories (Note 3) ...Other current assets (Note 4)...Total current assets...Long-term assets: Property, net (...

  • Page 88
    ...expenditures...Maturity of time deposits ...Proceeds from sale of property / investments ...Cost of business and technology acquisitions, net of cash acquired...Decrease in restricted cash...Loans to related parties ...Acquisition of minority held shares...Dividends from equity method investments in...

  • Page 89
    ... ...Dividend payments of consolidated affiliates to minority shareholders ...Taxes withheld on employees' restricted share award vestings Repurchase of ordinary shares ...Share based compensation ...Assets purchased from non-controlling interests in excess of book value...Balance at December 31...

  • Page 90
    ... principles generally accepted in the United States of America ("U.S. GAAP"). Nature of operations-Delphi is a leading global vehicle components manufacturer and provides electrical and electronic, powertrain, safety and thermal technology solutions to the global automotive and commercial vehicle...

  • Page 91
    ... public offering on November 22, 2011 of 24,078,827 ordinary shares by the selling shareholders for an aggregate purchase price of approximately $530 million, all of the outstanding equity of Delphi Automotive LLP was exchanged for 328,244,510 ordinary shares, par value $0.01 in Delphi Automotive...

  • Page 92
    ... vehicle program, whichever is shorter. Engineering, testing and other costs incurred in the design and development of production parts are expensed as incurred, unless the costs are reimbursable, as specified in a customer contract. As of December 31, 2013 and 2012, the Delphi-owned special tools...

  • Page 93
    ... assets over their estimated useful lives. We have definite-lived intangible assets related to patents and developed technology, customer relationships, trade names and in-process research and development. We do not amortize indefinite-lived in-process research and development, but test for...

  • Page 94
    ... and the correlation between the financial risk and the hedging instrument. Purchase orders, sales contracts, letters of intent, capital planning forecasts and historical data are used as the basis for determining the anticipated values of the transactions to be hedged. Delphi does not enter into...

  • Page 95
    ...for the VCP required us to make assumptions regarding the nature of the payout of the award as well as changes in our share price during the post-initial public offering period. The awards cliff vested on December 31, 2012, the end of the performance period. See Note 21. Share-Based Compensation for...

  • Page 96
    ...Foreign Entity. This guidance requires a reporting entity that ceases to have a controlling financial interest in a business with a foreign entity, other than a sale of in substance real estate or conveyance of oil and gas mineral rights, to release any related cumulative translation adjustment into...

  • Page 97
    ... method of accounting. These affiliates are not publicly traded companies and are located primarily in South Korea, China and Mexico. Delphi's ownership percentages vary generally from approximately 20% to 50%, with the most significant investments in Korea Delphi Automotive Systems Corporation...

  • Page 98
    ...for use. For the year ended December 31, 2012, in conjunction with the restructuring activities initiated in the fourth quarter, as more fully discussed in Note 10. Restructuring, Delphi incurred $15 million of impairment charges related to longlived assets held for use in its Electronics and Safety...

  • Page 99
    ... of the carrying amount of goodwill, by operating segment, for the years ended December 31, 2013 and 2012 is presented below: Electrical/ Electronic Architecture Powertrain Systems (in millions) Total Balance at January 1, 2012 ...$ Acquisitions...Foreign currency translation and other...Balance...

  • Page 100
    8. LIABILITIES Accrued liabilities consisted of the following: December 31, 2013 December 31, 2012 (in millions) Payroll-related obligations ...Employee benefits, including current pension obligations ...Executive long-term incentive plan (Note 21) ...Income and other taxes payable ...Warranty ...

  • Page 101
    ... year ended December 31, 2012. 10. RESTRUCTURING Delphi's restructuring activities are undertaken as necessary to implement management's strategy, streamline operations, take advantage of available capacity and resources, and ultimately achieve net cost reductions. These activities generally relate...

  • Page 102
    ... restructuring charges recorded for the years ended December 31, 2013, 2012 and 2011 by operating segment: Year Ended December 31, Segment 2013 2012 (in millions) 2011 Electrical/Electronic Architecture...$ Powertrain Systems ...Electronics and Safety ...Thermal Systems ...Total...$ 28 52 56 9 145...

  • Page 103
    ... to $2.4 billion. Under the 2012 Credit Agreement, the Company increased the Revolving Credit Facility to $1.3 billion and the Tranche A Term Loan to $574 million and used the incremental proceeds to pay a portion of the cost of acquiring MVL. On March 1, 2013, following the unsecured note issuance...

  • Page 104
    ...all such collateral was released in the first quarter of 2014. The Credit Agreement requires that such security interests be reinstated if neither Delphi Automotive PLC nor Delphi Corporation have investment grade ratings from Standard & Poor's Rating Service or Moody's Investor Service. In addition...

  • Page 105
    ...the years ended December 31, 2013, 2012 and 2011, respectively. 12. PENSION BENEFITS Certain of Delphi's non-U.S. subsidiaries sponsor defined benefit pension plans, which generally provide benefits based on negotiated amounts for each year of service. Delphi's primary non-U.S. plans are located in...

  • Page 106
    ... and 2012. Year Ended December 31, 2013 Year Ended December 31, 2012 (in millions) Benefit obligation at beginning of year...Interest cost ...Actuarial (gain) loss...Benefits paid ...Benefit obligation at end of year ...Change in plan assets: Fair value of plan assets at beginning of year...Delphi...

  • Page 107
    ...Year ended December 31, 2013 Year ended December 31, 2012 (in millions) Benefit obligation at beginning of year...Liabilities assumed in the acquisition ...Divestitures ...Service cost ...Interest cost ...Actuarial loss ...Benefits paid ...Impact of curtailments ...Plan amendments ...Exchange rate...

  • Page 108
    ...$ $ Benefit costs presented below were determined based on actuarial methods and included the following: U.S. Plans Year Ended December 31, 2013 2012 (in millions) 2011 Interest cost ...$ Net periodic benefit cost ...$ 2 2 $ $ Non-U.S. Plans 3 3 $ $ 3 3 Year Ended December 31, 2013 2012 (in...

  • Page 109
    ... asset managers, including consideration of recent fund performance and historical returns, in developing the long-term rate of return assumptions. The assumptions for the U.K. and Mexico are primarily long-term, prospective rates. Delphi's pension expense for 2014 is determined at the 2013 year end...

  • Page 110
    ... $90 million in 2014. 12 7 9 8 7 27 $ 78 72 78 83 90 555 Delphi sponsors defined contribution plans for certain hourly and salaried employees. Expense related to the contributions for these plans was $49 million, $48 million, and $46 million for the years ended December 31, 2013, 2012 and 2011...

  • Page 111
    ... the indirect quoted market prices on regulated financial exchanges of the underlying investments included in the fund. Real Estate-The fair value of real estate properties is estimated using an annual appraisal provided by the administrator of the property investment. Management believes this is an...

  • Page 112
    ... financial exchanges. Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Real Estate Trust Fund Hedge Funds (in millions) Insurance Contracts Beginning balance at December 31, 2011...$ Actual return on plan assets: Relating to assets still held at the reporting date...Assets...

  • Page 113
    ... (88) 1 (63) 212 $ The current income tax payable was reduced by $1 million, $0 million and $0 million in the years ended December 31, 2013, 2012 and 2011, respectively, for excess tax deductions attributable to stock-based compensation. The related income tax benefits are recorded as increases to...

  • Page 114
    ...first quarter of 2013. As a result, the effective tax rate for the year ended December 31, 2013 was impacted by a tax benefit of approximately $22 million related to the 2012 research and development credit in addition to the 2013 research and development credit. On July 17, 2013, the United Kingdom...

  • Page 115
    ... for financial reporting purposes and the bases of such assets and liabilities as measured by tax laws. Significant components of the deferred tax assets and liabilities are as follows: December 31, 2013 (in millions) 2012 Deferred tax assets: Pension ...Employee benefits ...Net operating loss...

  • Page 116
    ... benefit for the years ended December 31, 2013, 2012 and 2011, respectively. The Company files tax returns in multiple jurisdictions and is subject to examination by taxing authorities throughout the world. Taxing jurisdictions significant to Delphi include the China, Brazil, France, Germany, Mexico...

  • Page 117
    ...wholly-owned subsidiary of Delphi Automotive PLC, and subsequent to the exchange, Delphi Automotive PLC completed the initial public offering of 24,078,827 ordinary shares by the selling shareholders for an aggregate purchase price of approximately $530 million. Delphi Automotive PLC did not receive...

  • Page 118
    ... of Managers as part of the Class E-1 Interest Incentive Plan in June 2010. The impact of the above transactions on weighted average shares outstanding follows: Year Ended December 31, 2011 (shares in millions) Weighted average ordinary shares outstanding as result of the initial public offering...

  • Page 119
    Year Ended December 31, 2013 2012 Total Number of Shares Repurchased...Average Price Paid per Share...$ Total (in millions)...$ 9,106,434 50.14 457 13,421,742 $ 30.02 $ 403 Approximately $190 million remains available under the September 2012 share repurchase program. All repurchased shares were...

  • Page 120
    ... outstanding classes based on the cumulative distribution provisions of the Fourth LLP Agreement. In conjunction with the adoption in 2010 of the 2010 Board of Managers Class E-1 Interest Incentive Plan and the VCP, both of which were long-term incentive plans designed to assist the Company in...

  • Page 121
    ...interests as of the close of business on October 31, 2011. The following table summarizes the allocation of net income (loss) to the membership interest classes for the 2011 period prior to the initial public offering. Period from January 1, 2011 to Initial Public Offering Net Income Attributable to...

  • Page 122
    ... INCOME (LOSS) The changes in accumulated other comprehensive income (loss) attributable to Delphi (net of tax) are as follows: Year Ended December 31, 2013 Year Ended December 31, 2012 (in millions) Year Ended December 31, 2011 Foreign currency translation adjustments: Balance at beginning of...

  • Page 123
    ...Year Ended December 31, 2013 (in millions) Details about Accumulated Other Comprehensive Income Components Affected Line Item in the Statement of Operations Gains (losses) on derivatives: Commodity derivatives ...Foreign currency derivatives ...Foreign currency derivatives ...$ (22) Cost of sales...

  • Page 124
    ... and Liabilities Presented in the Balance Sheet December 31, 2013 Asset Derivatives December 31, 2013 Liability Derivatives December 31, 2013 Balance Sheet Location Balance Sheet Location (in millions) Designated derivatives instruments: Commodity derivatives...Other Current Assets Foreign...

  • Page 125
    ...to unfavorable movements in the forward rates of certain foreign currencies and commodities. The pre-tax effect of derivative financial instruments in the consolidated statement of operations and consolidated statement of comprehensive income for the year ended December 31, 2013 is as follows: (Loss...

  • Page 126
    ... its derivative contracts using an income approach based on valuation techniques to convert future amounts to a single, discounted amount. Estimates of the fair value of foreign currency and commodity derivative instruments are determined using exchange traded prices and rates. Delphi also considers...

  • Page 127
    ... and other debt issued by Delphi's foreign subsidiaries, the Tranche A Term Loan, the Tranche B Term Loan, the New Senior Notes and the 2013 Senior Notes. The fair value of debt is based on quoted market prices for instruments with public market data or the current book value for instruments without...

  • Page 128
    ... Motorized Vehicles Division of FCI On October 26, 2012, Delphi acquired 100% of the equity interests of MVL for â,¬765 million, or approximately $1 billion based on exchange rates on the acquisition date. MVL, a leading global manufacturer of automotive connection systems with a focus on high-value...

  • Page 129
    ... was generally estimated based on utilizing income and market approaches. The pro forma effects of this acquisition would not materially impact the Company's reported results for any period presented, and as a result no pro forma financial statements were presented. Sale of Italian Thermal Special...

  • Page 130
    ... on the closing price of the Company's ordinary shares on April 25, 2013. The RSUs will vest on April 2, 2014, the day before the 2014 annual meeting of shareholders. In February 2012, Delphi granted approximately 1.88 million RSUs to its executives. These awards include a time-based vesting portion...

  • Page 131
    ... to Delphi divided by the weighted average number of diluted shares outstanding for the respective three-year performance period. Relative total shareholder return is measured by comparing the average closing price per share of the Company's ordinary shares for all available trading days in...

  • Page 132
    ...the Class E-1 awards and for the years ended December 31, 2010, 2011, 2012 and 2013 for the VCP awards. These financial projections represented management's best estimate at the time of the contemporaneous valuations. Discount rates used to determine the present value of future cash flows were based...

  • Page 133
    ... and transactions. Statement of Operations Year Ended December 31, 2013 Parent Companies Subsidiary Issuer Guarantor Subsidiaries NonGuarantor Subsidiaries Eliminations Consolidated (in millions) Net sales...Operating expenses: Cost of sales...Selling, general and administrative ...Amortization...

  • Page 134
    Statement of Operations Year Ended December 31, 2012 Parent Companies Subsidiary Issuer Guarantor Subsidiaries NonGuarantor Subsidiaries Eliminations Consolidated (in millions) Net sales...Operating expenses: Cost of sales...Selling, general and administrative ...Amortization...Restructuring ......

  • Page 135
    Statement of Comprehensive Income Year Ended December 31, 2013 Parent Companies... instruments, net of tax ...Employee benefit plans adjustment, net of tax ......106 $ (1,585) $ Statement of Comprehensive Income Year Ended December 31, 2012 Parent Companies Subsidiary Issuer Guarantor Subsidiaries ...

  • Page 136
    Statement of Comprehensive Income Year Ended December 31, 2011 Parent Companies Subsidiary Issuer Guarantor Subsidiaries NonGuarantor Subsidiaries ... unrecognized loss on derivative instruments, net of tax ...Employee benefit plans adjustment, net of tax ...Other comprehensive loss...Equity ...

  • Page 137
    ...: Short-term debt...Accounts payable...Accrued liabilities...Total current liabilities...Long-term liabilities: Long-term debt ...Intercompany accounts, net ...Pension benefit obligations...Other long-term liabilities ...Total long-term liabilities ...Total liabilities ...Total Delphi shareholders...

  • Page 138
    ...: Short-term debt...Accounts payable...Accrued liabilities...Total current liabilities...Long-term liabilities: Long-term debt ...Intercompany accounts, net ...Pension benefit obligations...Other long-term liabilities ...Total long-term liabilities ...Total liabilities ...Total Delphi shareholders...

  • Page 139
    Statement of Cash Flows for the Year Ended December 31, 2013 Parent Companies Subsidiary Issuer Guarantor Subsidiaries NonGuarantor Subsidiaries Eliminations Consolidated (in millions) Net cash (used in) provided by operating activities ...Cash flows from investing activities: Capital ...

  • Page 140
    Statement of Cash Flows for the Year Ended December 31, 2012 Parent Companies Subsidiary Issuer Guarantor Subsidiaries NonGuarantor Subsidiaries Eliminations Consolidated (in millions) Net cash (used in) provided by operating activities ...Cash flows from investing activities: Capital ...

  • Page 141
    Statement of Cash Flows for the Year Ended December 31, 2011 Parent Companies Subsidiary Issuer Guarantor Subsidiaries NonGuarantor Subsidiaries Eliminations Consolidated (in millions) Net cash (used in) provided by operating activities ...Cash flows from investing activities: Capital ...

  • Page 142
    ... below are sales and operating data for Delphi's segments for the years ended December 31, 2013, 2012 and 2011, as well as balance sheet data as of December 31, 2013 and 2012. Electrical/ Electronic Architecture Powertrain Systems Electronics and Safety Thermal Systems Eliminations and Other...

  • Page 143
    Electrical/ Electronic Architecture Powertrain Systems Electronics and Safety Thermal Systems Eliminations and Other (1) Total (in millions) For the Year Ended December 31, 2012: Net sales ...EBITDA...Adjusted EBITDA...Depreciation and amortization...Operating income (3) ...Equity income (...

  • Page 144
    ... and other acquisition-related costs. The reconciliation of Adjusted EBITDA to net income attributable to Delphi for the years ended December 31, 2013, 2012 and 2011 are as follows: Electrical/ Electronic Architecture Powertrain Systems Electronics and Safety Thermal Systems Eliminations and Other...

  • Page 145
    ...is for the years ended December 31. Net property data is as of December 31. Year ended December 31, 2013 Net Property(1) Year ended December 31, 2012 (in millions) Net Sales Net Sales Net Property(1) Net Sales Net Property(1) Year ended December 31, 2011 United States...Other North America...Europe...

  • Page 146
    ... Company's unaudited quarterly results of continuing operations for fiscal 2013 and 2012. Three months ended March 31, 2013 Net sales ...$ Cost of sales...Gross profit...Operating income ...Net income (1)...Net income attributable to Delphi ...Basic net income per share: Basic net income per share...

  • Page 147
    ... to management, including the Company's Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. The Company's disclosure controls and procedures include components of the Company's internal control over financial reporting. Based...

  • Page 148
    ... print to any shareholder who submits a request to: Corporate Secretary, Delphi Automotive PLC, c/o Delphi Automotive Systems, LLC, 5725 Delphi Drive, Troy, Michigan, 48098. Information on the Company's website is not deemed to be incorporated by reference into this Annual Report on Form 10-K. ITEM...

  • Page 149
    ... filed as part of this Form 10-K. (1) Financial Statements: Reports of Independent Registered Public Accounting Firm Consolidated Statements of Operations for the Years Ended December 31, 2013, 2012 and 2011 Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2013...

  • Page 150
    ... Current Report on Form 8K of the Company filed with the SEC on March 1, 2013). Form of Delphi Automotive LLP Letter re: Special Bonus for Initial Public Offering or Sale of the Company(3)+ Delphi LLC Annual Incentive Plan(1)+ Delphi Corporation Supplemental Executive Retirement Program(1)+ Delphi...

  • Page 151
    ...# XBRL Taxonomy Extension Presentation Linkbase Document# 101.INS 101.SCH 101.CAL 101.DEF 101.LAB 101.PRE * Filed herewith. + Management contract or compensatory plan or arrangement (1) Filed with the Registration Statement on Form S-1 (File No. 333-174493) of Delphi Automotive PLC on June 30...

  • Page 152
    ... duly authorized. DELPHI AUTOMOTIVE PLC /s/ Kevin P. Clark By: Kevin P. Clark Executive Vice President and Chief Financial Officer Dated: February 10, 2014 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below as of February 10, 2014, by the...

  • Page 153
    /s/ Sean O. Mahoney Sean O. Mahoney /s/ Thomas W. Sidlik Thomas W. Sidlik /s/ Bernd Wiedemann Bernd Wiedemann /s/ Lawrence A. Zimmerman Lawrence A. Zimmerman Director Director Director Director 131

  • Page 154
    ... 31, 2009 Predecessor Year ended December 31, 2013 Income (loss) before income taxes and equity income ...$ Cash dividends received from nonconsolidated affiliates and other...Portion of rentals deemed to be interest ...Interest and related charges on debt ...Earnings available for fixed charges...

  • Page 155
    ... Executive Officer I, Rodney O'Neal, certify that: 1. 2. I have reviewed this annual report on Form 10-K of Delphi Automotive PLC; Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made...

  • Page 156
    ... Principal Financial Officer I, Kevin P. Clark, certify that: 1. 2. I have reviewed this annual report on Form 10-K of Delphi Automotive PLC; Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements...

  • Page 157
    ...ACT OF 2002 In connection with the filing of this annual report on Form 10-K of Delphi Automotive PLC (the "Company") for the period ended December 31, 2013, with the Securities and Exchange Commission on the date hereof (the "Report"), I, Rodney O'Neal, Chief Executive Officer, certify, pursuant to...

  • Page 158
    ... ACT OF 2002 In connection with the filing of this annual report on Form 10-K of Delphi Automotive PLC (the "Company") for the period ended December 31, 2013, with the Securities and Exchange Commission on the date hereof (the "Report"), I, Kevin Clark, Chief Financial Officer, certify, pursuant to...

  • Page 159
    ... Relations Contact Copies of the Annual Report, Forms 10-K and 10-Q and other Delphi publications are available via our website at www.delphi.com or contact: Delphi Investor Relations Services Delphi Automotive PLC 5725 Delphi Drive Troy, MI 48098 Phone: (248) 813-2494 Stock Exchange The company...

  • Page 160
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