What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-11-18 compared with 2023-11-17 · 259 added, 271 removed, 1195 unchanged (31% of the section changed)

30 unchanged sentences

We believe that our audits provide a reasonable basis for our opinions.

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Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures

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that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

6 unchanged sentences

Annual Goodwill Impairment Assessment

As described in Notes 1 and 6 to the consolidated financial statements, the Company’s goodwill balance, which is comprised of the Americas, EMEA and Asia reporting units (collectively, “the reporting units”), was $2,094 million as of September 30, 2023.

As described in Notes 1, 6 and 17 to the consolidated financial statements, the Company’s goodwill balance, which is comprised of the Americas, Europe, the Middle East and Africa (EMEA), and Asia Pacific/China (Asia) reporting units (collectively, “the reporting units”), was $2,164 million as of September 30, 2024.

Management reviews goodwill for impairment during the fourth fiscal quarter or more frequently if events or changes in circumstances indicate the asset might be impaired.

Fair value of the reporting units is estimated using an income approach utilizing discounted cash flow analyses.

This method requires management to make assumptions about estimates of the revenue and the operating margins, as well as the discount rates.

The estimated future cash flows reflect management’s latest assumptions of the financial projections based on current and anticipated competitive landscape, including estimates of revenue based on production volumes over the foreseeable future and long-term growth rates, and operating margins based on historical trends and future cost containment activities, as well as the discount rates.

The principal considerations for our determination that performing procedures relating to the annual goodwill impairment assessment is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the reporting units;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to estimates of the operating margins for the Americas reporting unit, estimates of the operating margins as well as the discount rate for the EMEA reporting unit, and estimates of the revenue for the Asia reporting unit;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to estimates of operating margins for the Americas reporting unit, estimates of revenue, long-term growth rate, and operating margins, as well as the discount rate for the EMEA reporting unit, and estimates of revenue for the Asia reporting unit;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

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(ii) evaluating the appropriateness of the discounted cash flow analyses;

(iii) testing the completeness and accuracy of underlying data used in the discounted cash flow analyses;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to estimates of the operating margins for the Americas reporting unit, estimates of the operating margins as well as the discount rate for the EMEA reporting unit, and estimates of the revenue for the Asia reporting unit.

Evaluating management’s assumptions related to estimates of the revenue and the operating margins involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the reporting units;

(iii) testing the completeness and accuracy of underlying data used by management in the discounted cash flow analyses;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to estimates of operating margins for the Americas reporting unit, estimates of revenue, long-term growth rate, and operating margins, as well as the discount rate for the EMEA reporting unit, and estimates of revenue for the Asia reporting unit.

Evaluating management’s assumptions related to estimates of revenue, long-term growth rate, and operating margins involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the reporting units, as applicable;

(ii) the consistency with relevant industry data;

and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating the appropriateness of the discounted cash flow analyses and the reasonableness of the discount rate.

Professionals with specialized skill and knowledge were used to assist in evaluating the appropriateness of the discounted cash flow analyses and the reasonableness of the long-term growth rate and discount rate assumptions.

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/s/ PricewaterhouseCoopers LLP

10 unchanged sentences

Selling, general and administrative expenses 507 554 598

Loss on business divestitures - net

Restructuring and impairment costs 168 40 25

Equity income (loss) 84 75 1,484

Earnings (loss) before interest and income taxes 523 259 1,726

Equity income 90 84 75

Earnings before interest and income taxes 343 523 259

Net financing charges 189 195 215

Other pension expense (income) 21 33 ( 10 )

Income (loss) before income taxes 295 54 1,439

Income tax provision (benefit) — 94 249

Income before income taxes 133 295 54

Income tax provision 32 — 94

Net income (loss) 101 295 ( 40 )

Income (loss) attributable to noncontrolling interests 90 80 82

Income attributable to noncontrolling interests 83 90 80

Net income (loss) attributable to Adient $ 18 $ 205 $ ( 120 )

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Cash and cash equivalents $ 945 $ 1,110

Accounts receivable, less allowance for doubtful accounts of $ 15 and $ 21 , respectively

Accounts receivable, less allowances of $ 24 and $ 15 , respectively

Inventories 758 841

13 unchanged sentences

Accrued compensation and benefits 358 400

Restructuring reserve 51 60

Other current liabilities 759 678

33 unchanged sentences

Pension and postretirement contributions, net ( 20 ) ( 17 ) ( 16 )

Equity in earnings of partially-owned affiliates, net of dividends received (includes purchase accounting amortization of $ 2 , $ 2 and $ 5 , respectively)

Equity in earnings of partially-owned affiliates, net of dividends received ( 17 ) ( 34 ) 4

(Gain) on sale of / impairment of nonconsolidated partially owned affiliates ( 1 ) 6 10

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Other assets ( 57 ) ( 26 ) 32

Restructuring reserves ( 53 ) ( 57 ) ( 136 )

Accounts payable and accrued liabilities 90 ( 19 ) 485

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Business divestitures ( 2 ) 5 740

Loans to affiliates — — 15

Other — ( 2 ) —

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Effect of exchange rate changes on cash and cash equivalents 47 ( 4 ) ( 59 )

Increase (decrease) in cash and cash equivalents, including cash classified within current assets held for sale 163 ( 574 ) ( 155 )

cash classified within current assets held for sale — — ( 16 )

Increase (decrease) in cash and cash equivalents ( 165 ) 163 ( 574 )

10 unchanged sentences

Foreign currency translation adjustments — — — ( 219 ) ( 219 ) ( 20 ) ( 239 )

Realized and unrealized gains (losses) on derivatives — — — 20 20 — 20

Employee retirement plans — — — 1 1 — 1

Dividends attributable to noncontrolling interests — — — — — ( 42 ) ( 42 )

Change in noncontrolling interest share — — — — — ( 3 ) ( 3 )

Dividends paid to and other transactions with noncontrolling interests — — — — — ( 53 ) ( 53 )

Purchase of subsidiary shares from noncontrolling interest — 12 — — 12 ( 12 ) —

Share based compensation and other — 23 — — 23 — 23

Balance at September 30, 2022 $ — $ 4,026 $ ( 1,108 ) $ ( 845 ) $ 2,073 $ 302 $ 2,375

Net income (loss) — — ( 120 ) — ( 120 ) 45 ( 75 )

Net income — — 205 — 205 63 268

Foreign currency translation adjustments — — — ( 18 ) ( 18 ) ( 2 ) ( 20 )

Employee retirement plans — — — 1 1 — 1

Dividends attributable to noncontrolling interests — — — — — ( 53 ) ( 53 )

Purchase of subsidiary shares from noncontrolling interest — 12 — — 12 ( 12 ) —

Realized and unrealized gains on derivatives — — — 21 21 — 21

Dividends paid to and other transactions with noncontrolling interests — — — — — ( 45 ) ( 45 )

Repurchase and retirement of ordinary shares — ( 65 ) — — ( 65 ) — ( 65 )

Share based compensation and other — 12 — — 12 — 12

Balance at September 30, 2023 $ — $ 3,973 $ ( 903 ) $ ( 842 ) $ 2,228 $ 318 $ 2,546

Net income (loss) — — 205 — 205 63 268

Net income — — 18 — 18 45 63

Foreign currency translation adjustments — — — 181 181 6 187

Realized and unrealized gains (losses) on derivatives — — — 21 21 — 21

Dividends attributable to noncontrolling interests — — — — — ( 45 ) ( 45 )

Realized and unrealized losses on derivatives — — — ( 32 ) ( 32 ) — ( 32 )

Dividends paid to and other transactions with noncontrolling interests — — — — — ( 60 ) ( 60 )

Repurchase and retirement of ordinary shares — ( 275 ) — — ( 275 ) — ( 275 )

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Organization and Summary of Significant Accounting Policies

Adient is a global leader in the automotive seating supplier industry.

Adient has a leading market position in the Americas, Europe and China, and has longstanding relationships with the largest global original equipment manufacturers, or OEMs, in the automotive space.

Adient is a global leader in the automotive seating supplier industry and maintains relationships with the largest global automotive original equipment manufacturers, or OEMs.

Adient's proprietary technologies extend into virtually every area of automotive seating solutions, including complete seating systems, frames, mechanisms, foam, head restraints, armrests and trim covers.

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The consolidated financial statements of Adient have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S.

Principles of Consolidation

Adient consolidates its wholly-owned subsidiaries and those entities in which it has a controlling interest.

Investments in partially-owned affiliates are accounted for by the equity method when Adient's interest exceeds 20% and does not have a controlling interest.

Investments in partially-owned affiliates are accounted for by the equity method when Adient does not have a controlling interest but is assessed to have significant influence on their operations.

Certain figures for comparative periods were reclassified to conform to current period presentation.

Consolidated VIEs

16 unchanged sentences

Actual results could differ from those estimates.

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Fair Value of Financial Instruments

1 unchanged sentence

See Note 10, “Derivative Instruments and Hedging Activities,” and Note 11, “Fair Value Measurements,” of the notes to consolidated financial statements for fair value of financial instruments, including derivative instruments and hedging activities.

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Cash and Cash Equivalents

2 unchanged sentences

Receivables consist of amounts billed and currently due from customers and revenues that have been recognized for accounting purposes but not yet billed to customers.

Adient extends credit to customers in the normal course of business and maintains an allowance for doubtful accounts resulting from the inability or unwillingness of customers to make required payments.

The allowance for doubtful accounts is established based on historical data along with Adient’s assessment of expected credit losses that reflects current and forecasted industry and economic conditions.

This methodology is in accordance with ASC Topic 326, Financial Instruments - Credit Losses.

Adient extends credit to customers in the normal course of business and maintains allowances resulting from the inability or unwillingness of customers to make required payments.

The allowances are established based on historical data along with Adient’s assessment of expected credit losses that reflects current and forecasted industry and economic conditions, in accordance with ASC Topic 326, Financial Instruments - Credit Losses.

Adient enters into supply chain financing programs in certain domestic and foreign jurisdictions to either sell or discount accounts receivable without recourse to third-party institutions.

Sales or discounts of accounts receivable are reflected as a reduction of accounts receivable on the consolidated statements of financial position and the proceeds are included in cash flows from operating activities in the consolidated statements of cash flows.

As of September 30, 2023 and 2022, $ 170 million and $ 269 million have been funded under these programs, respectively.

Inventories are stated at the lower of cost or market.

As of both September 30, 2024 and 2023, $ 170 million was funded under these programs.

Inventories are stated at the lower of cost or net realizable value.

Cost is determined using the first-in, first-out method.

13 unchanged sentences

At September 30, 2023, Adient recorded within the consolidated statements of financial position in other current and noncurrent assets $ 151 million and $ 11 million, respectively, of costs for molds, dies and other tools for which customer reimbursement is contractually assured.

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Property, Plant and Equipment

2 unchanged sentences

The estimated useful lives range from 3 to 40 years for buildings and improvements and from 3 to 15 years for machinery and equipment.

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Operating lease right-of-use (“ROU”) assets and liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement dates.

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An impairment is recorded to the extent the estimated fair value is below the carrying amount of the reporting unit.

No goodwill impairment has been recorded in fiscal 2024, 2023 or 2022.

As a result of macroeconomic factors impacting Adient and the automotive industry, a heightened risk of impairment exists for the EMEA reporting unit as the difference between its fair value and carrying value is less than 10% as of September 30, 2024.

The decrease in EMEA’s fair value is driven by lower forecasted vehicle volumes from weakening consumer demand, slower consumer adoption of electric vehicles, overcapacity in the industry resulting in pricing pressure, intensifying competition from Chinese imports and lower exports to China from EMEA as domestic brands expand in China.

As a result of the heightened risk of impairment, Adient will continuously assess the changing macroeconomic conditions in EMEA including the outlook for consumer demand for vehicles and other factors impacting the region, along with the need for further restructuring actions, all of which impact Adient’s ability to achieve its projected long-term operating performance.

Refer to Note 6, “Goodwill and Other Intangible Assets,” of the notes to the consolidated financial statements for additional information.

Intangible assets with definite lives are amortized over their estimated useful lives and are subject to impairment testing if events or changes in circumstances indicate that the asset might be impaired.

3 unchanged sentences

If the undiscounted cash flows do not indicate the carrying amount of the asset is recoverable, an impairment charge is measured as the amount by which the carrying amount of the asset group exceeds its fair value based on discounted cash flow analysis or appraisals.

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Impairment of Investments in Partially-Owned Affiliates

8 unchanged sentences

Contracts may provide for annual price reductions over the production life of the awarded program, and prices are adjusted on an ongoing basis to reflect changes in product content/cost and other commercial factors.

The amount of revenue recognized reflects the consideration that Adient expects to be entitled to in exchange for such products based on purchase orders, annual price

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reductions and ongoing price adjustments.

The amount of revenue recognized reflects the consideration that Adient expects to be entitled to in exchange for such products based on purchase orders, annual price reductions and ongoing price adjustments.

Refer to Note 2, “Revenue Recognition,” of the notes to consolidated financial statements for information on Adient's revenue recognition.

Essentially all of Adient’s sales are to the automotive industry.

Adient's most significant customers, Volkswagen Group and Stellantis N.V., comprised 11 % and 10 %, respectively, of consolidated net sales in fiscal 2023.

Volkswagen Group comprised 13 % and 11 % of consolidated net sales in fiscal 2024 and 2023, respectively, primarily within the EMEA segment.

Ford Motor Company comprised 12 % and 11 % of consolidated net sales in fiscal 2024 and 2023, respectively, across all segments.

Stellantis N.V.

comprised 12 % of consolidated net sales in fiscal 2022, and Stellantis N.V.

and Volkswagen Group comprised 13 % and 11 %, respectively, of consolidated net sales in fiscal 2021.

comprised 10 % and 12 % of consolidated net sales in fiscal 2023 and 2022, respectively, primarily within the Americas segment.

Research and Development Costs

1 unchanged sentence

Such expenditures for the years ended September 30, 2024, 2023 and 2022 were $ 372 million, $ 362 million and $ 322 million, respectively.

A portion of these costs associated with these activities are reimbursed by customers and, for the fiscal years ended September 30, 2023, 2022 and 2021 were $ 250 million, $ 194 million and $ 210 million, respectively.

A portion of these costs associated with these activities are reimbursed by customers in the amounts of $ 280 million, $ 250 million and $ 194 million for the fiscal years ended September 30, 2024, 2023 and 2022, respectively.

Government Assistance

5 unchanged sentences

These benefits are recognized in the statements of income as a reduction of expense when Adient has met or is expected to meet all related contractual obligations.

The impact of government assistance received by Adient during fiscal 2023 and related balances as of September 30, 2023 were immaterial.

The impact of government assistance received by Adient and related balances for all periods presented were immaterial.

Foreign Currency Translation

4 unchanged sentences

The aggregate transaction gains (losses) included in net income for the years ended September 30, 2024, 2023 and 2022 were $( 3 ) million, $ 4 million and $ 6 million, respectively.

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Derivative Financial Instruments

2 unchanged sentences

Refer to Note 10, “Derivative Instruments and Hedging Activities,” and Note 11, “Fair Value Measurements,” of the notes to consolidated financial statements for disclosure of Adient's derivative instruments and hedging activities.

Restructuring Costs

Adient recognizes restructuring costs that are probable and reasonably estimable related to separation programs that have been approved by and are committed to by management.

In these situations, the affected employees are identified and it is unlikely that actions required to complete the separation plan will change significantly.

Costs associated with benefits that are contingent on the employee continuing to provide services are recorded over the required service period.

All other costs associated with restructuring activities are expensed as incurred.

Stock-Based Compensation

4 unchanged sentences

Refer to Note 12, “Stock-Based Compensation,” of the notes to consolidated financial statements for Adient's stock based compensation disclosures.

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Pension and Postretirement Benefits

16 unchanged sentences

Nonetheless, the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year.

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Adient does not generally provide for additional income taxes which would become payable upon repatriation of undistributed earnings of wholly owned foreign subsidiaries.

1 unchanged sentence

Refer to Note 16, “Income Taxes,” of the notes to consolidated financial statements for Adient's income tax disclosures.

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Earnings Per Share

13 unchanged sentences

Standards Adopted During Fiscal 2024

On October 1, 2022, Adient adopted Accounting Standards Codification (“ASU”) 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40).

ASU 2020-06 simplifies the accounting for certain financial instruments with characteristics of liabilities and equity by reducing the number of accounting models for convertible debt and convertible preferred stock.

The adoption of this guidance on October 1, 2022 did not significantly impact Adient's consolidated financial statements for fiscal 2023.

On October 1, 2022, Adient adopted ASU 2021-10, Government Assistance (Topic 832) - Disclosures by Business Entities about Government Assistance.

The ASU requires annual disclosures of:

(i) information about the nature of government assistance transactions and the related accounting policy used to account for the transactions;

(ii) the balance sheet and income statement line items affected by the transactions, and the amounts for each financial statement line item;

and (iii) significant transaction terms and conditions.

The adoption of this guidance on October 1, 2022 resulted in new disclosures but did not significantly impact Adient's consolidated financial statements for fiscal 2023.

On October 1, 2023, Adient adopted Accounting Standards Codification (“ASU”) 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50):

Disclosure of Supplier Finance Program Obligations , which requires disclosures of key terms of Adient's material supplier finance program.

Refer to Note 9, "Debt and Financing Arrangements," of the notes to consolidated financial statements for additional information.

Standards Effective After Fiscal 2024

Adient has considered the ASU summarized below, effective after fiscal 2023, which is not expected to significantly impact the consolidated financial statements but will result in new disclosures:

Standard Pending Adoption Description Date Effective

ASU 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50):

Disclosure of Supplier Finance Program Obligations The ASU requires buyers of goods and services to disclose information about supplier finance programs if such arrangements are used to manage their payables.

The disclosures should include both qualitative and quantitative information including key terms and the amount of outstanding obligations.

October 1, 2023

Adient has considered the new standards that are summarized below, each to be effective after fiscal 2024:

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Standard to be Adopted Description Date Effective

ASU 2023-07 Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures The ASU requires additional disclosures on significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss (collectively referred to as the “significant expense principle”).

The ASU also requires additional disclosures of an amount for other segment items by reportable segment and a description of its composition.

October 1, 2024

ASU 2023-09 Income Taxes (Topic 740):

Improvements to Income Tax Disclosures The ASU requires disclosure of additional details about the reporting entity's reconciliation of the effective tax rate to the statutory rate for federal, state, and foreign income taxes.

The ASU also requires further disaggregation of income tax amounts paid by federal, state and foreign, as well as by material jurisdiction.

October 1, 2025

SEC Climate Disclosure Rules

Final Rule 33-11275 In March 2024, the SEC adopted the final rule surrounding disclosures of the impacts and risks of climate-related matters that have a material impact on Adient's operations and consolidated financial statements.

These disclosures would be required in annual reports and registration statements and would discuss Scope 1 and Scope 2 greenhouse gas emissions along with other climate-related information such as severe weather events and other natural conditions.

In April 2024, the SEC voluntarily stayed the climate disclosure rules pending judicial review.

Adient is monitoring the outcome and evaluating the impact of these rules on its consolidated financial statements and related disclosures.

October 1, 2025 (under final rules which are now stayed)

ASU 2024-03 Income Statement - Reporting Comprehensive

Income - Expense:

Disaggregation Disclosures

(Subtopic 220-40) The ASU requires disclosures of specified information about certain costs and expenses in the notes to financial statements at each interim and annual reporting period, including:

the amounts of purchases of inventory, employee compensation, depreciation, intangible asset amortization, and a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively.

It also requires disclosures of the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses.

October 1, 2027

Revenue Recognition

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Approximately 1 % of net sales recorded in fiscal 2024 were related to product sales transacted in prior fiscal years.

In pursuit of new program awards, Adient at times agrees to make upfront payments to customers.

Each time such a payment is made, Adient evaluates its nature, the underlying economics, legal and compliance ramifications, and other relevant factors and circumstances.

These payments are deemed to be consideration payable to customers and are generally recognized as a reduction to revenue once mutually agreed.

Certain upfront payments, however, are capitalized as other current and noncurrent assets if they are determined to be incremental, attributable only to the specific new program being awarded, and recoverable.

As products under the new program are sold to the customer, the capitalized amount is amortized and recognized as a reduction to revenue over the term of the program, typically between three and seven years.

Adient assesses recoverability of the capitalized amounts on an on-going basis.

Any amounts that are concluded to be no longer recoverable are immediately recognized as a reduction to revenue.

As of September 30, 2024 and 2023, Adient maintained capitalized upfront payments of

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$ 155 million and $ 126 million, respectively, within other noncurrent assets.

In a typical arrangement with the customer, purchase orders are issued for pre-production activities which consist of engineering, design and development, tooling and prototypes for the manufacture and delivery of component parts.

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Taxes collected from customers are excluded from revenue and credited directly to obligations to the appropriate government agencies.

Payment terms with customers are established based on customary industry and regional practices.

Adient has evaluated the terms of its arrangements and determined that they do not contain significant financing components.

Payment terms with customers are established based on customary industry and regional practices and do not contain significant financing components.

Contract assets primarily relate to the right to consideration for work completed, but not billed at the reporting date on contracts with customers.

1 unchanged sentence

Contract liabilities primarily relate to contracts where advance payments or deposits have been received, but performance obligations have not yet been satisfied and revenue has not been recognized.

No significant contract assets or liabilities exist at September 30, 2023.

No material contract assets or liabilities exist at September 30, 2024.

As described above, the issuance of a purchase order and/or a materials release by the customer represents the point at which an enforceable contract with the customer exists.

2 unchanged sentences

Acquisitions and Divestitures

2024 Transaction

In November 2023, Adient finalized the sale of 51 % of its interest (previously held 100 %) in Adient (Langfang) Seating Co., Ltd.

("LFADNT") in China for ¥ 44 million ($ 6 million), resulting in the deconsolidation of LFADNT, including $ 9 million of cash.

Adient recorded an $ 8 million loss as a result of the transaction in the Asia segment, including $ 5 million of allocated goodwill.

2023 Transactions

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Upon acquisition, YFAT was renamed as Adient (Nantong) Automotive Seating Components Co., Ltd.

Adient also completed in fiscal 2023 the transfer of all of the issued and outstanding equity interests in two joint ventures in China held directly by Adient, each of which represents 25 % of their total issued and outstanding equity interests, to Yanfeng Automotive Trim Systems Company Ltd.

(“Yanfeng”) for $ 3 million.

Adient concluded that indicators of other-than-temporary impairment were present related to the investments in these joint ventures during fiscal 2022, and recorded a non-cash impairment charge of $ 3 million.

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2021 Yanfeng Transaction

On March 12, 2021, Adient, Yanfeng, Yanfeng Adient Seating Co., Ltd.

(“YFAS”), a joint venture owned, directly or indirectly, by Yanfeng ( 50.01 %) and Adient ( 49.99 %), and KEIPER, a joint venture owned, directly or indirectly, by Yanfeng ( 50 %) and Adient ( 50 %), entered into a Master Agreement (the “2021 Agreement”), pursuant to which the parties agreed to, among other things, transactions that resulted in the sale of Adient’s 49.99 % interest in YFAS to Yanfeng, the sale of Adient’s ownership interests in 3 other related joint ventures (ranging from 10 % to 25 %) to YFAS/KEIPER, and the purchase of YFAS’s 50 % interest in Chongqing Adient Automotive Components Co., Ltd.

(“CQADNT”) and YFAS’s 100 % interest in Adient (Langfang) Seating Co., Ltd.

(“LFADNT”) (collectively, the “2021 Yanfeng Transaction”).

The 2021 Yanfeng Transaction closed on September 30, 2021 (“Closing Date”).

As a result of the 2021 Yanfeng Transaction, Adient received net cash proceeds of $ 1,141 million ($ 489 million in September 2021 and $ 652 million in December 2021) for the sale of Adient’s 49.99 % interest in YFAS to Yanfeng, $ 100 million as the final cash dividend from YFAS, $ 59 million for the sale of Adient’s ownership interests in the 3 other related joint ventures, $ 54 million for granting a license of intellectual property to Yanfeng for use on a non-exclusive and perpetual basis, and a business consulting fee of $ 13 million.

Adient also made a net payment of $ 211 million to Yanfeng related to the purchase CQADNT and LFADNT (the purchase price of $ 271 million, less $ 60 million cash acquired) on the Closing Date.

In conjunction with the 2021 Yanfeng Transaction, Adient provided Chongqing Boxun Industrial Co., Ltd.

(“Boxun”), which owned 25 % of CQADNT, an option to sell its interest in CQADNT.

This option was reflected as $ 194 million of redeemable noncontrolling interest on Adient’s statement of financial position as of September 30, 2021.

Boxun exercised its option in October 2021, and Adient acquired Boxun’s 25 % interest effective January 2022.

The total payment to Boxun from Adient was approximately $ 200 million, of which $ 15 million of historical dividends were paid in December 2021, and $ 185 million, including $ 32 million of historical dividends, was paid later in fiscal 2022.

With the acquisitions of Boxun’s 25 % and YFAS’s 50 % interest of CQADNT, Adient owns 100 % of CQADNT effective January 2022.

As a result of the 2021 Agreement, Adient also received $ 41 million during fiscal 2022 ($ 19 million had been receiving in fiscal 2021) representing the remaining balance of proceeds from the sale of its interest in Yanfeng Global Automotive Interior Systems Co.

(“YFAI”), a joint venture previously owned, directly or indirectly, by Yanfeng ( 70 %) and Adient ( 30 %), which was part of the 2020 Yanfeng Transaction (as defined and described in Form 10-K for the fiscal year ended September 30, 2021).

Russia/Ukraine conflict

Following Russia's invasion of Ukraine in February 2022, Adient determined to withdraw from the Russian market.

Adient recorded a charge of $ 5 million during fiscal 2022 in conjunction with completion of the withdrawal from and sale of its Russian operations for one ruble.

On March 31, 2021, Adient sold its 50 % equity interest in Shenyang Jinbei Adient Automotive Components Co., Ltd.

(“SJA”) to the joint venture partner for $ 58 million, which resulted in a $ 33 million one-time gain recognized during fiscal 2021.

2022 Transactions

In conjunction with the 2021 and 2020 Yanfeng Transactions (as defined and described in Form 10-K for the fiscal year ended September 30, 2021), Adient received total proceeds of $ 693 million during fiscal 2022 from sales of its interests in two nonconsolidated partially-owned affiliates in China.

Assets held for sale

During fiscal 2022, Adient committed to sell certain assets in EMEA.

As a result, these assets were classified as assets held for sale and were required to be adjusted to the lower of fair value less cost to sell or carrying value.

This resulted in an impairment charge of $ 6 million.

The impairment was measured using third party sales pricing to determine fair values of the assets.

The inputs utilized in the analyses are classified as Level 3 inputs within the fair value hierarchy as defined in ASC 820, "Fair Value Measurement.”

During fiscal 2021, Adient committed to sell certain assets in France and Turkey.

As a result, these assets were classified as assets held for sale (including an allocation of $ 11 million of goodwill) and were required to be adjusted to the lower of fair value less cost to sell or carrying value.

This resulted in Adient recording an impairment charge of $ 9 million within restructuring and impairment costs on the consolidated statement of income (loss) related to the assets in France.

The impairment was measured using third party sales pricing to determine fair values of the assets.

The inputs utilized in the analyses are classified as Level 3 inputs within the fair value hierarchy as defined in ASC 820, "Fair Value Measurement." The sale of the assets in France was completed in fiscal 2021 for minimal proceeds while the sale of the assets in Turkey was completed in fiscal 2022 for total proceeds of $ 46 million, of which $ 36 million was collected at closing, and $ 10 million was collected later in fiscal 2022.

As a result, these assets were classified as assets held for sale and were required to be adjusted to the lower of fair value less cost to sell or carrying value, which resulted in an impairment charge of $ 6 million.

Also, the sale of certain operations in EMEA which were classified as held for sale in fiscal 2021 was completed in fiscal 2022 for total proceeds of $ 46 million.

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23 unchanged sentences

Balance at September 30, 2022 $ 607 $ 295 $ 1,155 $ 2,057

Business acquisitions — — 13 13

Currency translation and other 2 22 — 24

Balance at September 30, 2023 $ 609 $ 317 $ 1,168 $ 2,094

Business acquisitions — — 13 13

Business divestiture — — ( 5 ) ( 5 )

Currency translation and other ( 3 ) 24 54 75

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The estimated future cash flows reflect management's latest assumptions of the financial projections based on current and anticipated competitive landscape, including estimates of revenue based on production volumes over the foreseeable future and long-term growth rates, and operating margins based on historical trends and future cost containment activities.

The financial projections considered the impact of the various issues causing the volatility in the automotive industry such as wage inflationary pressures and higher interest rates.

As a result of the test, there was no goodwill impairment recorded for fiscal year 2023.

A change in any of these estimates and assumptions could produce significantly lower fair values of Adient’s reporting units, which could have a material impact on its results of operations.

The financial projections considered the impact of the various issues causing uncertainty in the automotive industry such as weaker vehicle demand impacted by new vehicle affordability and a high interest rate environment, slower global adoption of electric vehicles by consumers, volatile commodity pricing, and persistent inflationary pressures.

Specifically in the EMEA region, where Adient recorded significant restructuring charges during fiscal 2024, a heightened risk of impairment exists as the difference between its fair value and carrying value is less than 10%.

The EMEA reporting unit maintains $ 341 million of goodwill at September 30, 2024.

No goodwill impairment was recorded in fiscal 2024;

however, if further degradation in the economic conditions in the EMEA region occur or if significantly higher levels of restructuring actions are needed in the region, the EMEA reporting unit may incur significant impairment of goodwill and other long-lived assets.

Adient generally assumes operating margins in future years will normalize over time as it is believed that this is consistent with a market participant view.

The current year results are not indicative of future market participant expectations primarily due to the current challenging market conditions as mentioned above.

While revenue is not expected to return to historical levels, there are expectations for enhanced profitability and cash flows driven by near-term efficiency actions, strategic review of portfolio and reduction of capital expenditures.

Long-term profitability and cash flows will also be impacted by the expiration of underperforming contracts and more profitable business starting in fiscal 2026 along with restructuring benefits taking full effect.

Further, the high levels of recent restructurings and the associated significant costs of such actions in the EMEA region are not expected to persist for the long-term at comparable levels.

Adient's other intangible assets, primarily from business acquisitions valued based on independent appraisals, consisted of:

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Customer relationships 563 ( 246 ) 317 550 ( 201 ) 349

Trademarks 17 ( 17 ) — 19 ( 17 ) 2

Miscellaneous 24 ( 12 ) 12 25 ( 12 ) 13

Trademarks and other 25 ( 13 ) 12 41 ( 29 ) 12

Total intangible assets $ 669 $ ( 298 ) $ 371 $ 670 $ ( 262 ) $ 408

9 unchanged sentences

The changes in Adient's total product warranty liability are as follows:

Adient plc | Form 10-K | 71

September 30,

3 unchanged sentences

Settlements made (in cash or in kind) during the period ( 6 ) ( 8 )

Currency translation — ( 1 )

Balance at end of period $ 22 $ 21

Adient's lease portfolio consists of operating leases for real estate including production facilities, warehouses and administrative offices, equipment such as forklifts and computer servers and laptops, and fleet vehicles.

Adient's lease portfolio consists of operating leases for real estate including production facilities, warehouses and administrative offices, equipment such as forklifts, computer servers, laptops and fleet vehicles.

Adient has elected not to record leases with an initial term of 12 months or less on its consolidated statement of financial position.

Adient plc | Form 10-K | 70

A lease liability and corresponding ROU asset are recognized based on the present value of lease payments.

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Maturities of operating lease liabilities and minimum payments for operating leases having initial or remaining non-cancelable terms in excess of one year as of September 30, 2024 were as follows:

Adient plc | Form 10-K | 72

Fiscal years (in millions) Operating Leases

4 unchanged sentences

Supplemental cash flow information related to leases was as follows:

Adient plc | Form 10-K | 71

Year Ended September 30,

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(1) The weighted average interest rates on short-term debts, based on levels of debt maintained in various jurisdictions, were 5.4 % and 10.1 % at September 30, 2024 and 2023, respectively.

Adient plc | Form 10-K | 73

Adient US LLC (“Adient US”), a wholly owned subsidiary of Adient, together with certain of Adient's other subsidiaries, maintains an asset-based revolving credit facility (the “ABL Credit Facility”), which provides for a revolving line of credit up to $ 1,250 million, including a North American subfacility of up to $ 950 million and a European subfacility of up to $ 300 million, subject to borrowing base capacity and certain other restrictions, including a minimum fixed charge coverage ratio.

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Loans under the ABL Credit Facility may be denominated, at the option of Adient, in U.S.

dollars, Euros, Pounds Sterling or Swedish Kroner.

Dollars, Euros, Pounds Sterling or Swedish Krona.

It also provides flexibility for future amendments to the ABL Facility to incorporate certain sustainability-based pricing provisions.

The ABL Credit Agreement is secured on a first-priority lien on all accounts receivable, inventory and bank accounts (and funds on deposit therein) and a second-priority lien on all of the tangible and intangible assets of certain Adient subsidiaries.

Interest is payable on the ABL

Adient plc | Form 10-K | 72

Credit Facility at a fluctuating rate of interest determined by reference to Term SOFR, in the case of amounts outstanding in dollars, EURIBOR, in the case of amounts outstanding in euros, STIBOR, in the case of amounts outstanding in Swedish krona and SONIA, in the case of amounts outstanding in pounds sterling, in each case, plus an applicable margin of 1.50 % to 2.00 %.

Interest is payable on the ABL Credit Facility at a fluctuating rate of interest determined by reference to Term SOFR, in the case of amounts outstanding in Dollars, EURIBOR, in the case of amounts outstanding in Euros, STIBOR, in the case of amounts outstanding in Swedish Krona and SONIA, in the case of amounts outstanding in Pounds Sterling, in each case, plus an applicable margin of 1.50 % to 2.00 %.

As of September 30, 2024, Adient had not drawn down on the ABL Credit Facility and had availability under this facility of approximately $ 779 million (net of $ 11 million of letters of credit).

In addition, Adient US and Adient Global Holdings S.à r.l., a wholly-owned subsidiary of Adient, maintain a senior secured term loan facility (the “Term Loan B Agreement”) that had an outstanding balance of $ 988 million as of September 30, 2022.

In addition, Adient Global Holdings S.à r.l., a wholly-owned subsidiary of Adient, maintains a senior secured term loan facility (the “Term Loan B Agreement”) that had an outstanding balance of $ 632 million as of September 30, 2024.

During fiscal 2023, Adient prepaid $ 350 million of the Term Loan B Agreement principal, and wrote off $ 2 million of previously deferred financing costs to net financing charges.

As of September 30, 2023, the remaining balance of this debt was $ 635 million, maintained fully at Adient Global Holdings S.à r.l., which is due at final maturity on April 8, 2028.

Interest on the Term Loan B Agreement accrues at the Eurodollar rate plus an applicable margin equal to 3.25 %.

During fiscal 2024, the Term Loan B Agreement was amended to reduce the applicable margin from 3.25 % to 2.75 % and extend final maturity to January 31, 2031 (which maturity was previously April 8, 2028).

Adient incurred $ 5 million of costs associated with the modification, of which $ 4 million was recorded as deferred financing costs.

The Term Loan B Agreement amortizes in equal quarterly installments at a rate of 1.00 % per annum of the original principal amount thereof, with the remaining balance due at final maturity.

The Term Loan B Agreement also permits Adient to incur incremental term loans in an aggregate amount not to exceed the greater of $ 750 million and an unlimited amount subject to a pro forma first lien secured net leverage ratio of not greater than 1.75 to 1.00 and certain other conditions.

In April 2023, the Term Loan B Agreement was amended to replace the LIBOR base rate with Term SOFR.

The ABL Credit Facility and Term Loan B Agreement contain covenants that are usual and customary for facilities and debt instruments of this type and that, among other things, restrict the ability of Adient and its restricted subsidiaries to:

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(“AGH”), a wholly-owned subsidiary of Adient, issued (i) $ 500 million (net proceeds of $ 494 million) in aggregate principal amount of 7 % senior secured notes due 2028 and (ii) $ 500 million (net proceeds of $ 494 million) in aggregate principal amount of 8.250 % senior unsecured notes due 2031.

Interest on both of these notes will be paid on April 15 and October 15 each year, beginning on October 15, 2023.

Interest on both of these notes are paid on April 15 and October 15 each year, beginning on October 15, 2023.

These notes contain covenants that are usual and customary.

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Adient paid $ 16 million in debt issuance costs for these new debt issuances.

AGH previously maintained $ 900 million aggregate principal amount of 4.875 % USD-denominated unsecured notes due 2026.

Adient redeemed $ 103 million and $ 2 million during fiscal 2020 and 2021, respectively, resulting in a remaining balance of $ 795 million as of September 30, 2023 and 2022.

AGH also previously maintained € 1.0 billion aggregate principal amount of 3.50 % unsecured notes due in August 2024.

During fiscal 2022, Adient repurchased € 177 million ($ 198 million) of the 3.50 % unsecured notes due 2024 at a premium of € 3 million ($ 4 million) plus € 3 million ($ 3 million) of accrued and unpaid interest, and expensed € 1 million ($ 1 million) of previously deferred financing costs to net financing charges, resulting in a remaining balance of € 823 million ($ 809 million) as of September 30, 2022.

During fiscal 2023, Adient repurchased an additional € 700 million ($ 743 million) of the 3.50 % unsecured notes due 2024 at a premium of € 7 million ($ 7 million) plus € 3 million ($ 3 million) of accrued and unpaid interest, and expensed € 2 million ($ 2 million) of previously deferred financing costs to net financing charges.

As of September 30, 2023, the remaining balance of this debt was € 123 million ($ 130 million) and is classified as current portion of long-term debt on the consolidated statement of financial position.

Adient Germany Ltd.

KG, a wholly owned subsidiary of Adient, previously maintained € 135 million ($ 156 million) in an unsecured term loan from the European Investment Bank (EIB) due in 2022.

The loan bore interest at the 6-month EURIBOR rate plus 158 basis points.

During fiscal 2021, Adient repaid $ 36 million of the EIB loan, triggered in part by the redemption of debt and the sale of the fabrics business in the prior year.

Adient fully repaid the remaining balance of the EIB loan in May 2022 upon its maturity.

In April 2020, Adient US issued $ 600 million (net proceeds of $ 591 million) aggregate principal amount of 9.00 % Senior First Lien Notes due 2025.

In fiscal 2022, Adient repurchased the full $ 600 million of 9.00 % Senior First Lien Notes due 2025 at a

AGH also maintains 4.875 % USD-denominated unsecured notes due 2026.

The aggregate principal amount of these notes was $ 795 million as of September 30, 2024 and 2023.

AGH also paid the remaining balance of its 3.50 % Euro denominated unsecured notes of € 123 million ($ 132 million) in August 2024 upon final maturity.

During fiscal 2023, Adient repurchased € 700 million ($ 743 million) of the 3.50 % unsecured notes due 2024 at a premium of € 7 million ($ 7 million) plus € 3 million ($ 3 million) of accrued and unpaid interest, and expensed € 2 million ($ 2 million) of previously deferred financing costs to net financing charges.

Adient plc | Form 10-K | 74

premium of $ 34 million plus $ 19 million of accrued and unpaid interest, and expensed $ 7 million of previously deferred financing costs to net financing charges.

During fiscal 2022, Adient repurchased the entirety of its $ 600 million, 9.00 % Senior First Lien Notes due 2025 at a premium of $ 34 million plus $ 19 million of accrued interest.

Principal payments required on long-term debt during the next five years are as follows:

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Total interest paid on both short and long-term debt for the fiscal years ended September 30, 2024, 2023 and 2022 was $ 187 million, $ 132 million and $ 192 million, respectively.

Other Arrangements

Adient enters into supply chain financing programs in certain domestic and foreign jurisdictions to either sell or discount accounts receivable without recourse to third-party institutions.

As of September 30, 2023, $ 170 million was funded under these programs compared to $ 269 million as of September 30, 2022.

As of both September 30, 2024 and September 30, 2023, $ 170 million was funded under these programs.

Adient also has a program with an external financial institution under which Adient's suppliers can sell their receivables from Adient to the financial institution at their sole discretion.

Adient is not a party to the agreements between the participating suppliers and the financial institution.

Adient's obligation under the program is to pay the original amounts of supplier invoices to the financial institution on the original invoice dates.

No fees are paid and no assets are pledged by Adient.

The payment terms for trade payables can range from 45 days to 120 days depending on types of services and goods being purchased.

The payment terms for molds, dies and other tools that are acquired as part of pre-production activities are in general longer, and are normally dependent on the terms which Adient has agreed with its customers.

As of September 30, 2024, and September 30, 2023, Adient's liabilities related to this program were $ 76 million and $ 50 million, respectively.

Cash flows related to the program are all presented within operating activities in Adient's consolidated statements of cash flows.

Derivative Instruments and Hedging Activities

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In addition, refer to Note 11, “Fair Value Measurements,” of the notes to consolidated financial statements for information related to the fair value measurements and valuation methods utilized by Adient for each derivative type.

Adient plc | Form 10-K | 75

Adient has global operations and participates in the foreign exchange markets to minimize its risk of loss from fluctuations in foreign currency exchange rates.

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All contracts were highly effective in hedging the variability in future cash flows attributable to changes in currency exchange rates at September 30, 2024 and 2023, respectively.

As of September 30, 2023, the € 123 million ($ 130 million) aggregate principal amount of 3.50 % euro-denominated unsecured notes due August 2024 was designated as a net investment hedge to selectively hedge portions of Adient's net investment in

Adient plc | Form 10-K | 74

The € 123 million ($ 132 million) aggregate principal amount of 3.50 % Euro-denominated unsecured notes due August 2024 was previously designated as a net investment hedge to selectively hedge portions of Adient's net investment in Europe.

The currency effects of Adient's Euro-denominated notes are reflected in the AOCI account within shareholders' equity attributable to Adient where they offset gains and losses recorded on Adient's net investment in Europe.

In October 2023, Adient de-designated these notes as a net investment hedge concurrent with entering into a foreign exchange forward contract designated as a fair value hedge of the remaining principal balance on the 3.50 % notes.

The impact of foreign currency changes on the notes and the contract will be recorded in net financing charges until payment of the notes and maturity of the foreign exchange forward contract in August 2024.

During the first quarter of fiscal 2024, Adient de-designated these notes as a net investment hedge concurrent with entering into a foreign exchange forward contract designated as a fair value hedge of the principal balance on the 3.50 % notes.

The impact of foreign currency changes on the notes and the contract were recorded in net financing charges until payment of the notes and maturity of the foreign exchange forward contract in August 2024.

During the second quarter of fiscal 2024, Adient entered into a ¥ 685 million ($ 96 million) foreign exchange forward contract to selectively hedge portions of its net investment in China.

Adient de-designated the majority of the contracted amount during fourth quarter of fiscal 2024, resulting in an outstanding contract amount of ¥ 120 million ($ 17 million) as of September 30, 2024.

The contract matured in October 2024, the impact of which was not material.

During the third quarter of fiscal 2024, Adient entered into an additional ¥ 570 million ($ 78 million) contract to selectively hedge portions of its net investment in China.

The contract is set to mature in October 2025.

Adient entered into a ¥ 240 million ($ 35 million) foreign exchange forward contract during the second quarter of fiscal 2023 to selectively hedge portions of its net investment in China.

4 unchanged sentences

The forward contract matured in early fiscal 2023, the impact of which was not material.

Adient plc | Form 10-K | 76

The following table presents the location and fair values of derivative instruments and other amounts used in hedging activities included in Adient's consolidated statements of financial position:

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Foreign currency exchange derivatives $ 9 $ 30 $ 6 $ 4

Other noncurrent assets

Foreign currency exchange derivatives 1 — 2 —

Total assets $ 10 $ 30 $ 8 $ 4

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Net amount $ 9 $ 22 $ 32 $ 132

Adient plc | Form 10-K | 75

The following table presents the effective portion of pretax gains (losses) recorded in other comprehensive income related to cash flow hedges:

2 unchanged sentences

Foreign currency exchange derivatives $ ( 2 ) $ 89 $ 8

Adient plc | Form 10-K | 77

The following table presents the location and amount of the effective portion of pretax gains (losses) on cash flow hedges reclassified from AOCI into Adient's consolidated statements of income:

3 unchanged sentences

Foreign currency exchange derivatives Cost of sales $ 46 $ 66 $ 6

During the next twelve months, $ 23 million of pretax gains on cash flow hedges are expected to be reclassified from AOCI into Adient's consolidated statements of income.

During the next twelve months, $ 23 million of pretax loss on cash flow hedges are expected to be reclassified from AOCI into Adient's consolidated statements of income.

The following table presents the location and amount of pretax gains (losses) on fair value hedge activity in Adient's consolidated statements of income:

(in millions) Year Ended

September 30,

2024 2023 2022

Foreign currency exchange derivatives Net financing charges $ 1 $ — $ —

The following table presents the location and amount of pretax gains (losses) on derivatives not designated as hedging instruments recognized in Adient's consolidated statements of income (loss):

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Foreign currency exchange derivatives $ 15 $ — $ 15 $ —

Other noncurrent assets

Foreign currency exchange derivatives 3 — 3 —

Total assets $ 18 $ — $ 18 $ —

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Adient also provides directors with share awards under the Adient plc 2016 Director Share Plan and the Adient plc 2021 Omnibus Incentive Plan.

These 2016 plans were adopted in conjunction with the separation.

The 2021 plan was adopted in March 2021.

Total stock-based compensation cost included in the consolidated statements of income was $ 31 million, $ 34 million and $ 29 million for the fiscal years ended September 30, 2024, 2023 and 2022, respectively.

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That cost is expected to be recognized over a weighted-average period of 1.9 years.

Stock Options

No new stock options have been granted under the Plan.

Stock option awards typically vest between two and three years after the grant date and expire ten years from the grant date.

The fair value of each option was estimated on the date of grant using a Black-Scholes option valuation model.

A summary of stock option activity at September 30, 2023, and changes for the year then ended, is presented below:

Option Price Shares

Option Weighted

Life (years) Aggregate

(in millions)

Outstanding and exercisable, September 30, 2022

$ 38.32 49,939

Exercised 25.79 ( 20,638 )

Forfeited or expired 27.54 ( 2,444 )

Outstanding and exercisable, September 30, 2023

48.93 26,857 1.3 $ —

There were no stock options granted in fiscal years 2023, 2022 and 2021, respectively.

The total intrinsic value of options exercised by Adient employees during the fiscal years ended September 30, 2023, 2022 and 2021 was approximately $ 1 million, $ 1 million and $ 7 million, respectively.

Stock Appreciation Rights

No new SARs have been granted under the Plan.

SARs vest under the same terms and conditions as stock option awards;

however, they are settled in cash for the difference between the market price on the date of exercise and the exercise price.

As a result, SARs are recorded in Adient's consolidated statements of financial position as a liability until the date of exercise.

The fair value of each SAR award is estimated using a similar method described for stock options.

The fair value of each SAR award is recalculated at the end of each reporting period and the liability and expense are adjusted based on the new fair value.

Adient plc | Form 10-K | 79

A summary of SAR activity at September 30, 2023, and changes for the year then ended, is presented below:

SAR Price Shares

Life (years) Aggregate

(in millions)

Outstanding, September 30, 2022

$ 43.87 42,454

Exercised 45.78 ( 34,269 )

Forfeited or expired 35.84 ( 8,185 )

Outstanding, September 30, 2023

In conjunction with the exercise of SARs, Adient made payments of $ 1 million, $ 2 million and $ 2 million during the fiscal years ended September 30, 2023, 2022 and 2021, respectively.

Equity and Noncontrolling Interests

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Accumulated other comprehensive income (loss), end of period $ ( 693 ) $ ( 842 ) $ ( 845 )

(1) Foreign currency translation adjustments as of September 30, 2023 and 2022 include derivative net investment hedge gains of $ 76 million and $ 143 million, respectively.

(1) Foreign currency translation adjustments as of September 30, 2024 and 2023 include gains (losses) on designated net investment hedge instruments of $( 4 ) million and $ 76 million, respectively.

During the next twelve months, no significant gains or losses are expected to be reclassified from AOCI into Adient's consolidated statements of income.

10 unchanged sentences

Dividends ( 21 ) ( 18 ) ( 66 )

Business acquisition — — 194

Change in noncontrolling interest share — — ( 153 )

1 unchanged sentence

Ending balance $ 91 $ 57 $ 45

Refer to Note 3, “Acquisitions and Divestitures,” of the notes to the consolidated financial statements for additional information on the change in redeemable noncontrolling interests during fiscal 2022 and 2021.

(1) During fiscal 2024, a $ 5 million adjustment was recorded to increase income attributable to noncontrolling interest related to fiscal 2023.

The change in noncontrolling interests in fiscal 2022 relates to Adient’s acquisition of the remaining 25 % interest in Chongqing Adient Automotive Components Co., Ltd.

Repurchases of Equity Securities

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The number of ordinary shares repurchased, if any, and the timing of repurchases will depend on a number of factors, including share price, trading volume and general market conditions, as well as on working capital requirements, general business conditions and other factors.

During fiscal 2023, Adient repurchased and immediately retired 1,756,777 shares of its ordinary shares at an average purchase price per share of $ 37.00 .

During fiscal 2023, Adient repurchased and immediately retired 1,756,777 of its ordinary shares at an average purchase price per share of $ 37.00 .

The aggregate amount of cash paid to repurchase the shares was $ 65 million.

During fiscal 2024, Adient repurchased and immediately retired 9,424,668 of its ordinary shares at an average purchase price per share of $ 29.18 .

The aggregate amount of cash paid to repurchase the shares was $ 275 million.

As of September 30, 2024, the remaining aggregate amount of authorized repurchases was $ 260 million.

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Projected benefit payments from the plans as of September 30, 2024 are estimated as follows (in millions):

2029-2032 135

Adient plc | Form 10-K | 82

2030-2033 146

Savings and Investment Plans

83 unchanged sentences

Redemptions ( 4 )

Unrealized (loss) ( 1 )

Asset value as of September 30, 2024 $ —

8 unchanged sentences

Interest cost 19 18

Actuarial (gain) loss ( 15 ) ( 169 )

Actuarial loss (gain) 28 ( 15 )

Benefits paid ( 28 ) ( 20 )

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Pension plan assets (other noncurrent assets) $ 19 $ 22

Pension benefits ($ 16 million in accrued compensation and benefits)

Pension benefits (of which $ 5 million and $ 16 million are included in accrued compensation and benefits, respectively)

( 110 ) ( 108 )

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Expected return on plan assets ( 12 ) ( 12 ) ( 14 )

Net actuarial (gain) loss 19 ( 7 ) ( 15 )

Settlement (gain) loss 8 1 —

Net actuarial loss (gain) 13 19 ( 7 )

Settlement loss 1 8 1

Net periodic benefit cost (credit)

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Rate of compensation increase N/A N/A NA 4.53 % 4.43 % 4.05 %

Adient plc | Form 10-K | 86

Restructuring and Impairment Costs

Restructuring

To better align its resources with its overall strategies and reduce the cost structure of its global operations to address the softness in certain underlying markets, Adient commits to restructuring plans as necessary.

Adient plc | Form 10-K | 85

During fiscal 2023, Adient committed to a restructuring plan of $ 39 million.

Adient also recorded additional charges totaling $ 1 million related to prior year plans.

The restructuring actions relate to cost reduction initiatives and consist primarily of workforce reductions in EMEA.

The restructuring actions are expected to be substantially completed by fiscal 2025.

Restructuring costs are included in restructuring and impairment costs in the consolidated statements of income (loss).

Adient, in general, records costs associated with separation programs when management has approved the plan for separation, the affected employees are identified, and it is unlikely that actions required to complete the separation plan will change significantly.

Costs associated with benefits that are contingent on the employee continuing to provide service are accrued over the required service period.

All other costs associated with restructuring activities are expensed as incurred.

During fiscal 2024, Adient committed to a restructuring plan of $ 169 million that was offset by prior period underspend of $ 1 million and $ 9 million of cost reimbursement committed by a customer.

The fiscal 2024 charges are mostly related to termination benefits in Europe.

The 2024 Plan is being implemented in response to the macroeconomic factors occurring in the European automotive market causing reduced production volumes and to ensure Adient maintains a competitive cost structure by reducing operating, administrative and engineering costs, and increasing efficiencies.

Restructuring actions associated with these specific plans will primarily occur in fiscal years 2025 and 2026 and are expected to be substantially complete by fiscal year 2027.

Restructuring costs are included in restructuring and impairment costs in the consolidated statements of income.

The following tables summarize the changes in Adient's restructuring reserve.

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Balance at September 30, 2024 $ 181 $ 1 $ 182

Adient's restructuring plans have included workforce reductions of approximately 14,000 .

Restructuring charges associated with employee severance and termination benefits are paid over the severance period granted to each employee or on a lump sum basis in accordance with individual severance agreements.

As of September 30, 2023, approximately 12,000 of the employees have been separated from Adient pursuant to the restructuring plans.

In addition, the restructuring plans included twenty-eight plant closures.

As of September 30, 2023, twenty-three of the twenty-eight plants have been closed.

Current restructuring reserve - other current liabilities $ 87

Noncurrent restructuring reserve - other noncurrent liabilities 95

Balance at September 30, 2024 $ 182

Adient's management closely monitors its overall cost structure and continually analyzes each of its businesses for opportunities to consolidate current operations, improve operating efficiencies and locate facilities in low cost countries in close proximity to customers.

This ongoing analysis includes a review of its manufacturing, engineering, purchasing and administrative functions, as well as the overall global footprint for all its businesses.

Because of the importance of new vehicle sales by major automotive manufacturers to operations, Adient is affected by the general business conditions in the automotive industry.

Because of the importance of new vehicle sales by automotive manufacturers, Adient is affected by the general business conditions in the automotive industry.

Future adverse developments in the automotive industry could impact Adient's liquidity position, lead to impairment charges and/or require additional restructuring of its operations.

During fiscal 2024, Adient recorded an impairment loss of $ 9 million on its investment in Adient Aerospace.

The impairment is included in restructuring and impairment costs in the consolidated statement of income (loss).

Adient plc | Form 10-K | 87

Consolidated income (loss) before income taxes and noncontrolling interests for the years ended September 30, 2024, 2023, and 2022 is as follows:

4 unchanged sentences

Other Foreign

474 651 1,684

Income before income taxes and noncontrolling interests $ 133 $ 295 $ 54

Adient plc | Form 10-K | 86

The components of the provision (benefit) for income taxes are as follows:

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Other Foreign ( 1 ) ( 125 ) 5

( 1 ) ( 124 ) 5

Income tax provision $ 32 $ — $ 94

The significant components of Adient's income tax provision are summarized in the following tables.

These amounts do not include the impact of income tax expense related to our nonconsolidated partially-owned affiliates, which is netted against equity income on the consolidated statements of income (loss).

These amounts do not include the impact of income tax expense related to Adient’s nonconsolidated partially-owned affiliates, which is netted against equity income on the consolidated statements of income (loss).

The reconciliation between the Irish statutory income tax rate, and Adient’s effective tax rate is as follows:

Adient plc | Form 10-K | 88

September 30,

3 unchanged sentences

Foreign tax rate differential

22 ( 1 ) ( 6 )

Notional interest deduction ( 6 ) ( 6 ) ( 6 )

5 unchanged sentences

Change in valuation allowance 90 ( 61 ) 94

Impairment of subsidiaries — — 35

Tax adjustments to value of investments ( 38 ) — —

Tax impact of corporate equity and business restructuring transactions 1 1 30

1 unchanged sentence

Income tax provision $ 32 $ — $ 94

Adient plc | Form 10-K | 87

The income tax expense was higher than the Irish statutory rate of 12.5% for fiscal 2024 due to the inability to record a tax benefit for losses in jurisdictions with valuation allowances, the repatriation of foreign earnings, tax expense related to foreign exchange remeasurements of tax balances primarily in Mexico, and tax expense from the establishment of valuation allowances at certain subsidiaries, partially offset by tax benefits from the release of uncertain tax positions due to audit closures and from the release of valuation allowances at certain subsidiaries.

No items included in the other category are individually, or when appropriately aggregated, significant.

The income tax expense was lower than the Irish statutory rate of 12.5% for fiscal 2023 primarily due to the release of valuation allowances in Mexico, partially offset by the inability to recognize a tax benefit for losses in jurisdictions with valuation allowances, the repatriation of foreign earnings, and foreign tax rate differentials.

2 unchanged sentences

No items included in the other category are individually, or when appropriately aggregated, significant.

The income tax expense was higher than the Irish statutory rate of 12.5% for fiscal 2021 primarily due to the inability to recognize a tax benefit for losses in jurisdictions with valuation allowances, the establishment of valuation allowances in certain jurisdictions, and the repatriation of foreign earnings, partially offset by tax benefits from audit settlements, the write-off of deferred tax liabilities related to withholding taxes, and withholding taxes on the 2021 Yanfeng Transaction at a rate lower than the Irish statutory rate of 12.5%.

No items included in the other category are individually, or when appropriately aggregated, significant.

The foreign tax rate differential expense for fiscal 2023 is primarily driven by income earned in jurisdictions where the statutory rate is greater than 12.5%, partially offset by jurisdictions with losses where the statutory rate is greater than 12.5% and by the pretax book income of nonconsolidated partially-owned affiliates whose corresponding income tax expense is netted against equity income on the consolidated statements of income.

The foreign tax rate differential benefits for fiscal 2021 and fiscal 2022 are primarily driven by losses earned in jurisdictions where the statutory rate is greater than 12.5% and by the pretax book income of nonconsolidated partially-owned affiliates whose corresponding income tax expense is netted against equity income on the consolidated statements of income, partially offset by income earned in jurisdictions where the statutory rate is greater than 12.5%.

Adient’s foreign tax rate differential primarily comprises two components.

First is the difference in foreign tax rates from the Irish statutory tax rate that will fluctuate with the mix of income and losses in multiple jurisdictions with higher or lower statutory tax rates.

Second is the elimination of the effects, at the Irish statutory tax rate, on the amount of income reported for nonconsolidated partially-owned affiliates whose corresponding income tax expense is already netted against equity income on the consolidated statements of income and reflected in income (loss) before income taxes.

During fiscal 2024, 2023 and 2022, significant income and loss jurisdictions include Brazil, China, Germany, Luxembourg, Mexico, Thailand, the United Kingdom, and the United States, with federal statutory tax rates ranging between 16% and 34%, which are all above the Irish statutory rate of 12.5%.

Due to the significant jurisdictions in which it operates having statutory tax rates higher than the Irish statutory rate of 12.5%, Adient generally expects that foreign tax rate differentials will continue to result in net expense when its consolidated subsidiaries generate net pretax income and overall pretax income does not consist primarily of equity income from nonconsolidated partially-owned affiliates.

In periods in which Adient’s consolidated subsidiaries generate net losses, or overall pretax income consists primarily of equity income reported from nonconsolidated partially-owned affiliates, Adient generally expects that foreign tax rate differentials will result in a net benefit.

During fiscal 2024 and 2023, Adient’s pretax income was primarily generated by Adient’s consolidated subsidiaries, resulting in a net foreign tax rate differential expense.

During fiscal 2022, Adient’s pretax income consisted primarily of income of nonconsolidated partially-owned affiliates whose corresponding

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income tax expense is netted against equity income on the consolidated statements of income, with the elimination of the effects at the Irish statutory tax rate resulting in a net foreign tax rate differential benefit.

For fiscal 2024, the foreign tax differential expense of $ 9 million includes $ 20 million related to the higher tax expense resulting from the tax rate differential primarily from the mix of income and losses in the significant jurisdictions listed above with higher statutory tax rates than Ireland, which was partially offset by $ 11 million related to the elimination of the tax effects of the equity income from nonconsolidated partially-owned affiliates whose corresponding income tax expense is already netted in income before income taxes.

For fiscal 2023, the foreign tax differential expense of $ 22 million includes $ 33 million related to the higher tax expense resulting from the tax rate differential primarily from the mix of income and losses in the significant jurisdictions listed above with higher statutory tax rates than Ireland, which was partially offset by $ 11 million related to the elimination of the tax effects of the equity income from nonconsolidated partially-owned affiliates whose corresponding income tax expense is already netted in income before income taxes.

For fiscal 2022, the foreign tax differential benefit of $ 1 million includes $ 9 million related to the elimination of the tax effects of the equity income from nonconsolidated partially-owned affiliates, partially offset by $ 8 million related to the higher tax expense resulting from tax rate differential primarily related to the mix of income and losses in Adient’s consolidated subsidiaries with tax rates higher than Ireland.

Deferred taxes are classified in the consolidated statements of financial position as follows:

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Other noncurrent liabilities ( 191 ) ( 206 )

Net deferred tax asset/(liability)

$ 47 $ ( 87 )

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Net deferred tax asset

Temporary differences and carryforwards which gave rise to deferred tax assets and liabilities included:

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Employee and retiree benefits 24 25

Net operating loss and other credit carryforwards 1,293 1,226

Net operating loss and other carryforwards 1,400 1,293

Property, plant and equipment 114 113

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Indirect tax credits — 10

Foreign currency adjustments — 8

Operating lease right-of-use assets 57 55

Net deferred tax asset/(liability) $ 47 $ ( 87 )

Net deferred tax asset $ 54 $ 47

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At September 30, 2024, Adient had available net operating loss carryforwards of approximately $ 4.7 billion which are available to reduce future tax liabilities.

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Since future financial results may differ from previous estimates, periodic adjustments to Adient's valuation allowances may be necessary.

Given current earnings and anticipated future earnings at certain subsidiaries, Adient believes that there is a reasonable possibility that sufficient positive evidence may become available that would allow the release of all, or a portion of, valuation allowances at certain subsidiaries within the next twelve months.

Given current earnings and anticipated future earnings at certain subsidiaries, Adient believes that there is a possibility that sufficient positive evidence may become available that would allow the release of all, or a portion of, valuation allowances at certain subsidiaries within the next twelve months.

A release of valuation allowances, if any, would result in the recognition of certain deferred tax assets which could generate a material income tax benefit for the period in which such release is recorded.

As a result of Adient's fiscal 2023 analysis of the realizability of its worldwide deferred tax assets, and after considering tax planning initiatives and other positive and negative evidence, Adient determined it was more likely than not that certain deferred tax assets in Mexico would be realizable and recorded an income tax benefit of $ 114 million to release valuation allowances.

In addition, Adient determined it was necessary to release valuation allowances and establish valuation allowances in other jurisdictions that did not have a material impact on Adient’s financial statements.

As a result of Adient's fiscal 2024 analysis of the realizability of its worldwide deferred tax assets, and after considering tax planning initiatives and other positive and negative evidence, Adient determined it was more likely than not that certain deferred tax assets would be realizable and recorded an income tax benefit of $ 14 million in China, $ 8 million in Mexico, $ 7 million in France, and $ 6 million in Japan to release valuation allowances.

In addition, Adient determined it was necessary to establish valuation allowances on certain deferred tax assets in Poland and Mexico, recording tax expense of $ 14 million and $ 5 million, respectively.

Adient continues to record valuation allowances on certain deferred tax assets in Germany, Hungary, Luxembourg, Mexico, Poland, Spain, the United Kingdom, the U.S.

and other jurisdictions as it remains more likely than not that they will not be realized.

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During fiscal 2024, the valuation allowance in Luxembourg increased by $ 38 million related to tax adjustments to the value of certain investments, with an offsetting increase in net operating loss carryforwards and no net impact to tax expense.

As a result of Adient's fiscal 2022 analysis of the realizability of its worldwide deferred tax assets, and after considering tax planning initiatives and other positive and negative evidence, Adient determined it was more likely than not that certain deferred tax assets in Canada, Japan, and other jurisdictions would not be realized and recorded income tax expense of $ 12 million, $ 3 million and $ 3 million, respectively, to establish valuation allowances.

In addition, Adient determined it was more likely than not that certain deferred tax assets acquired as part of the 2021 Yanfeng Transaction would not be realized and recorded a net adjustment to goodwill of $ 7 million, primarily to establish valuation allowances.

Additionally, Adient determined it was more likely than not that deferred tax assets in the Czech Republic and other jurisdictions would be realizable and recorded income tax benefit of $ 11 million and $ 2 million, respectively, to release valuation allowances.

As a result of Adient’s fiscal 2021 analysis of the realizability of its worldwide deferred tax assets, and after considering tax planning initiatives and other positive and negative evidence, Adient determined it was more likely than not that certain deferred tax assets in the Czech Republic, Korea, Mexico, and other jurisdictions would not be realized and recorded income tax expense of $ 5 million, $ 5 million, $ 8 million, and $ 4 million, respectively, to establish valuation allowances.

Adient is subject to income taxes in Ireland, the U.S.

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Adient recognizes interest and penalties related to unrecognized tax benefits as a component of income tax expense.

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During fiscal 2024, Adient settled audits in various jurisdictions that resulted in a $ 115 million reduction to its unrecognized tax benefits, of which $ 63 million was recorded as a tax benefit.

The remaining difference primarily offset other changes in deferred tax balances.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

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Ending balance $ 422 $ 527 $ 499

During the next twelve months, it is likely that tax audit resolutions or applicable statute of limitation lapses could result in a significant change in the balance of gross unrecognized tax benefits.

During the next twelve months, it is possible that tax audit resolutions or applicable statute of limitation lapses could result in a significant change in the balance of gross unrecognized tax benefits.

Given the number of years, jurisdictions and positions subject to examination, Adient is unable to estimate the full range of possible adjustments to the balance of unrecognized tax benefits.

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It is not practicable to determine the unrecognized deferred tax liability on these earnings because the actual tax liability, if any, is dependent on circumstances existing when remittance occurs.

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Income taxes paid for the fiscal year ended September 30, 2023 were $ 94 million.

Income taxes paid for the fiscal year ended September 30, 2022 were $ 77 million.

Income taxes paid for the fiscal year ended September 30, 2021 were $ 78 million excluding $ 134 million of withholding taxes on the 2021 Yanfeng Transaction.

Income taxes paid for the fiscal years ended September 30, 2024, 2023 and 2022 were $ 96 million, $ 94 million and $ 77 million, respectively.

Impacts of Tax Legislation and Change in Statutory Tax Rates

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During fiscal 2022, Adient recognized a one-time gain of $ 32 million associated with the retrospective recovery of indirect tax credits in Brazil resulting from Adient’s prioritization of those credits, resulting in net tax expense of $ 4 million.

During fiscal 2021, Adient recognized $ 134 million of withholding tax expense associated with the 2021 Yanfeng Transaction.

Adient also recognized tax benefits of $ 13 million related to the write-off of deferred tax liabilities associated with Chinese joint ventures’ distributions of unremitted earnings that were reinvested in a wholly-owned Chinese subsidiary.

In addition, Adient recognized an additional $ 38 million pre-tax gain related to Brazil indirect tax credits as a result of a favorable supreme court ruling resulting in tax expense of $ 13 million.

Segment Information

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2) Europe, the Middle East and Africa (“EMEA”) and 3) Asia Pacific/China (“Asia”).

Adient evaluates the performance of its reportable segments using an adjusted EBITDA metric defined as income before income taxes and noncontrolling interests, excluding net financing charges, restructuring and impairment costs, restructuring related-costs, net mark-to-market adjustments on pension and postretirement plans, transaction gains/losses, purchase accounting amortization, depreciation, stock-based compensation and other non-recurring items.

Also, certain corporate-related costs are not allocated to the segments.

The reportable segments are consistent with how management views the markets served by Adient and reflect the financial information that is reviewed by its chief operating decision maker.

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September 30,

(in millions) 2023 2022 2021

Americas $ 7,220 $ 6,557 $ 6,164

EMEA 5,195 4,764 5,564

Asia 3,085 2,926 2,123

Eliminations ( 105 ) ( 126 ) ( 171 )

Total net sales $ 15,395 $ 14,121 $ 13,680

certain corporate-related costs are not allocated to the segments.

The reportable segments are consistent with how management views the markets served by Adient and reflect the financial information that is reviewed by its chief operating decision maker.

The following table summarizes net sales and adjusted EBITDA by reportable segment for fiscal 2024, 2023 and 2022:

(in millions) Americas EMEA Asia Corporate/Eliminations Consolidated

Net sales $ 6,763 $ 5,029 $ 2,989 $ ( 93 ) $ 14,688

Adjusted EBITDA $ 375 $ 155 $ 439 $ ( 89 ) $ 880

Net sales $ 7,220 $ 5,195 $ 3,085 $ ( 105 ) $ 15,395

Adjusted EBITDA $ 336 $ 232 $ 464 $ ( 94 ) $ 938

Net sales $ 6,557 $ 4,764 $ 2,926 $ ( 126 ) $ 14,121

Adjusted EBITDA $ 242 $ 138 $ 383 $ ( 88 ) $ 675

The following is a reconciliation of Adient's reportable segments' adjusted EBITDA to income before income taxes:

September 30,

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Asia 439 464 383

Subtotal 969 1,032 763

Corporate-related costs (1)

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Restructuring related activities (4)

Loss on disposal transactions (5)

( 7 ) ( 6 ) —

Gain on business divestitures, primarily related to the Yanfeng transaction (5)

( 285 ) ( 290 ) ( 298 )

Stock based compensation

Equity based compensation

( 31 ) ( 34 ) ( 29 )

Other items (6)

( 1 ) ( 4 ) 22

Earnings (loss) before interest and income taxes 523 259 1,726

Earnings before interest and income taxes 343 523 259

Net financing charges ( 189 ) ( 195 ) ( 215 )

Other pension income (expense) ( 21 ) ( 33 ) 10

Income (loss) before income taxes $ 295 $ 54 $ 1,439

Income before income taxes $ 133 $ 295 $ 54

(1) Corporate-related costs not allocated to the segments include executive office, communications, corporate development, legal and corporate finance.

(2) Reflects restructuring charges for costs that are directly attributable to restructuring activities and meet the definition of restructuring under ASC 420 and non-recurring impairment charges.

(2) Reflects restructuring charges for costs that are probable and reasonably estimable and one-time asset impairments.

During fiscal 2024, an impairment charge of $ 9 million related to Adient’s investment in Adient Aerospace was recorded.

During fiscal 2022, an impairment charge of $ 4 million related to the withdrawal from and sale of its operations in Russia, and a held-for-sale impairment charge of $ 6 million were recorded in EMEA.

Included in restructuring charges in fiscal 2021 is $ 10 million of held for sale and other non-cash impairment charges in EMEA.

Refer to Note 15, “Restructuring and Impairment Costs,” of the notes to the consolidated financial statements for more information.

(3) Reflects amortization of intangible assets including those related to partially owned affiliates recorded within equity income.

(4) Reflects restructuring related charges for costs that are directly attributable to restructuring activities, but do not meet the definition of restructuring under ASC 420 along with restructuring costs at partially owned affiliates recorded within equity income.

Fiscal 2023 includes a $ 10 million gain on the sale of a restructured facility in Americas.

(5) Fiscal 2021 includes a $ 5 million loss on sale of non-core assets in Asia, a gain associated with the 2021 Yanfeng Transaction of $ 1,160 million, and a gain of $ 33 million on the sale of Adient's interest in SJA.

All of these impacts have been recorded within the equity income line in the consolidated statements of income.

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(6) Fiscal 2023 reflects $ 3 million and $ 3 million of non-cash impairment related to certain of Adient's investments in nonconsolidated partially-owned affiliates in Asia and EMEA, respectively, and $ 3 million of transaction costs, partially offset by $ 4 million of one-time divestiture gain at an affiliate, and $ 4 million of a gain associated with the retrospective recovery of indirect tax credits in Brazil.

Fiscal 2022 includes $ 3 million and $ 7 million of non-cash impairments of certain of Adient's investments in nonconsolidated partially-owned affiliates in Asia and EMEA, respectively, $ 8 million of transaction costs, a $ 14 million charge related to a non-recurring contract related settlement, $ 1 million of allowance for doubtful accounts resulting from the withdrawal from and sale of operations in Russia, and $ 2 million of loss on finalization of asset sale in Turkey, partially offset by a gain of $ 32 million associated with the retrospective recovery of indirect tax credits in Brazil.

Fiscal 2021 reflects a gain of $ 38 million associated with the retrospective recovery of indirect tax credits in Brazil (of which $ 36 million relates to recoveries covering the past 20 years and is adjusted out of Americas' segment results), and a $ 5 million gain on previously held interest at YFAS in an affiliate, partially offset by $ 19 million of transaction costs.

(3) Reflects amortization of intangible assets including those related to partially owned affiliates recorded within equity income.

(4) Reflects restructuring-related charges for costs that are recorded as incurred or as earned and other non-recurring impacts that are directly attributable to restructuring activities.

Fiscal 2024 and 2023 also each include a non-recurring $ 10 million gain on the sale of two restructured facilities in Americas.

(5) Fiscal 2024 reflects an $ 8 million loss on sale of 51 % of Adient's interest in LFADNT (as described in Note 3, "Acquisitions and Divestitures," of the notes to consolidated financial statements), partially offset by a $ 1 million gain on sale of a nonconsolidated partially-owned affiliate.

Fiscal 2023 reflects $ 3 million and $ 3 million of non-cash impairment related to certain of Adient's investments in nonconsolidated partially-owned affiliates in Asia and EMEA, respectively,

(6) Fiscal 2024 reflects a $ 3 million non-recurring gain on a contract related settlement and $ 1 million of indirect tax recoveries in Brazil, partially offset by $ 1 million of transaction costs and a $ 1 million one-time divestiture related impact at an affiliate.

Fiscal 2023 reflects $ 4 million of one-time divestiture gain at an affiliate and $ 4 million of a gain associated with the retrospective recovery of indirect tax credits in Brazil, partially offset by $ 3 million of transaction costs.

Fiscal 2022 includes $ 3 million and $ 7 million of non-cash impairments of certain of Adient's investments in nonconsolidated partially-owned affiliates in Asia and EMEA, respectively, $ 8 million of transaction costs, a $ 14 million charge related to a non-recurring contract related settlement, $ 1 million of accounts receivable allowances resulting from the withdrawal from and sale of operations in Russia, and $ 2 million of loss on finalization of asset sale in Turkey, partially offset by a gain of $ 32 million associated with the retrospective recovery of indirect tax credits in Brazil.

Additional Segment Information

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(1) Reconciling items include the elimination of intercompany transactions, corporate-related assets and other amounts to reconcile to consolidated totals.

Specific reconciling items for equity income represents $ 6 million of non-cash impairments of Adient's investments in partially-owned affiliates, $ 2 million of restructuring related charges, and $ 2 million of purchase accounting amortization, partially offset by a $ 4 million gain on sale of certain assets at affiliates in China.

Corporate-related assets primarily include cash and deferred income tax assets.

Specific reconciling items for equity income represents $ 1 million of purchase accounting amortization.

Corporate-related assets primarily include cash and assets held for sale.

Year Ended September 30, 2023

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(1) Reconciling items include the elimination of intercompany transactions, corporate-related assets and other amounts to reconcile to consolidated totals.

Specific reconciling items for equity income represents $ 10 million of non-cash impairments of Adient's investments in partially-owned affiliates, $ 1 million of restructuring related charges, $ 2 million of purchase accounting amortization, $ 7 million of a non-recurring customer termination charge at an affiliate in Asia, partially offset by a $ 7 million non-recurring gain on sale of land use rights at an affiliate in China.

Corporate-related assets primarily include cash and deferred income tax assets.

Corporate-related assets primarily include cash and assets held for sale.

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(1) Reconciling items include the elimination of intercompany transactions, corporate-related assets and other amounts to reconcile to consolidated totals.

Specific reconciling items for equity income represents a gain associated with the 2021 Yanfeng Transaction of $ 1,181 million, a gain of $ 33 million on the sale of Adient's interest in SJA, a $ 5 million gain on previously held interest at YFAS, offset by $ 5 million of purchase accounting amortization and $ 1 million of restructuring related charges.

Corporate-related assets primarily include cash, deferred income tax assets, and receivables related to the 2021 Yanfeng Transaction.

Corporate-related assets primarily include cash and deferred income tax assets.

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Czech Republic 756 900 962

Spain 725 674 701

Other EMEA 3,736 3,714 3,462

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Total $ 14,688 $ 15,395 $ 14,121

Adient started consolidating CQADNT in China after completing the acquisition on September 30, 2021.

Refer to Note 3, “Acquisitions and Divestitures,” of the notes to the consolidated financial statements for additional information.

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Other Americas 17 18

Poland 131 118

Germany 127 127

Poland 155 131

Czech Republic 35 30

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Noncurrent liabilities $ 269 $ 283

Noncontrolling interests $ — $ 6

During fiscal 2023, Adient concluded that indicators of other-than-temporary impairment were present related to nonconsolidated partially-owned affiliates in Asia and EMEA, and recorded non-cash impairment charges of $ 3 million and $ 3 million as a result, respectively.

Over the past two fiscal years, Adient and KEIPER have modified existing supply agreements, resulting in reductions in Adient’s purchase prices on certain products.

In fiscal 2023 and 2022, Adient and KEIPER have modified existing supply agreements, resulting in reductions in Adient’s purchase prices on certain products.

Such modifications resulted in reductions of $ 25 million and $ 34 million in Adient’s cost of sales and equity income, respectively, during fiscal 2023.

29 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data